Share-Based Compensation Plans

12 Months Ended

Dec. 31, 2019

Share-Based Compensation [Abstract]

Share-Based Compensation Plans

8. Share-Based Compensation Plans

In May 2016, the Company’s shareholders approved the 2016 Long-Term Incentive Plan (the “2016 Plan”) and reserved 1,800,000 Common Shares (of which the maximum number of Common Shares which may be issued). Under the 2016 Plan, as of December 31, 2019, the Company has granted 1,200,753 share units, of which 476,870 were time-based with cliff vesting using the straight-line method and 723,883 were performance-based. There are 779,684 shares available to be granted under the 2016 Plan at December 31, 2019.

In 2019, 2018 and 2017, pursuant to the 2016 Plan, the Company granted time-based share units and performance-based performance shares. The time-based share units cliff vest three years after the date of grant. The performance based performance shares vest and are no longer subject to forfeiture upon the recipient remaining an employee of the Company for three years from the date of grant and, for a portion of the annual awards, upon the Company attaining certain targets of performance measured against a peer group’s three year performance in terms of total shareholder return and, for the remaining portion of the annual awards, upon achieving certain earnings per share targets and return on invested capital targets established by the Company during the performance period of the award.

The allocation of performance shares granted between total shareholder return, earnings per share and return on invested capital were as follows for the years ended December 31:

	2019		2018		2017
Total shareholder return	45	%	55	%	55	%
Earnings per share	36	%	45	%	45	%
Return on invested capital	18	%	-	%	-	%

In April 2005, the Company adopted the Directors’ Restricted Shares Plan (the “Director Share Plan”) and reserved 500,000 Common Shares for issuance under the Director Share Plan. In May 2013, shareholders approved an amendment to the Director Share Plan to increase the number of shares for issuance by 200,000 to 700,000. In May 2018, the Company’s shareholders approved the 2018 Amended and Restated Director’s Restricted Shares Plan (the “2018 Director Share Plan”) to increase the number of shares for issuance by 150,000 to 850,000. Under the 2018 Director Share Plan, the Company has cumulatively issued 670,797 restricted Common Shares. As such, there are 179,203 restricted Common Shares available to be issued at December 31, 2019. Shares issued annually under the 2018 Director Share Plan are no longer subject to forfeiture one year after the date of grant.

Share Units and Performance Shares

The fair value of the non-vested time-based share unit awards was calculated using the market value of the Common Shares on the date of issuance. The weighted-average grant-date fair value of time-based share units granted during the years ended December 31, 2019, 2018 and 2017 was $30.01, $24.69 and $18.73, respectively.

The fair value of the non-vested performance-based performance share awards with a performance condition requiring the Company to obtain certain earnings per share targets was estimated using the market value of the shares on the date of grant. The fair value of non-vested performance-based performance share awards with a market condition requiring the Company to obtain a total shareholder return target relative to a group of peer companies was estimated using a Monte Carlo valuation model taking into consideration the probability of achievement using multiple simulations. The awards that use earnings per share and return on invested capital as the performance target are expensed beginning when it is probable that the Company will meet the underlying performance condition.

A summary of the status of the Company’s non-vested share units and performance shares as of December 31, 2019 and the changes during the year then ended, are presented below:

	Time-based awards			Performance-based awards
		Weighted-			Weighted-
		average grant		Performance	average grant
	Share Units	date fair value		Shares	date fair value
Non-vested as of December 31, 2018	419,996	$	19.64	628,220	$	21.41
Granted	184,645	$	30.01	250,858	$	34.17
Vested	(196,404)	$	17.08	(236,902)	$	14.92
Forfeited or cancelled	(46,403)	$	23.70	(75,840)	$	27.42
Non-vested as of December 31, 2019	361,834	$	25.84	566,336	$	28.97

A summary of the status of the Company’s non-vested share units and performance shares as of December 31, 2018 and the changes during the year then ended, are presented below:

	Time-based awards			Performance-based awards
		Weighted-				Weighted-
		average grant		Performance	average grant
	Share Units	date fair value		Shares	date fair value
Non-vested as of December 31, 2017	443,152	$	15.01	744,188	$	14.92
Granted	176,116	$	24.69	215,490	$	29.41
Vested	(182,451)	$	13.21	(284,462)	$	11.19
Forfeited or cancelled	(16,821)	$	19.99	(46,996)	$	17.13
Non-vested as of December 31, 2018	419,996	$	19.64	628,220	$	21.41

As of December 31, 2019, total unrecognized compensation cost related to non-vested time-based share units granted was $3,924. That cost is expected to be recognized over a weighted-average period of 1.28 years.

For the years ended December 31, 2019, 2018 and 2017, the total fair value of awards vested was $12,376, $12,577 and $8,718, respectively.

As of December 31, 2019, total unrecognized compensation cost related to non-vested performance shares granted was $3,319 for shares probable to vest. That cost is expected to be recognized over a weighted-average period of 1.27 years dependent upon the achievement of performance conditions. As noted above, the Company has issued and outstanding performance-based share units that use different performance targets (total shareholder return, earnings per share and return on invested capital).

The excess tax benefit realized from the vesting of share units and performance shares of the share-based payment arrangements was $1,289, $1,584 and $858 for the years ended December 31, 2019, 2018 and 2017.