Stockholders' Equity

12 Months Ended

Dec. 31, 2019

Stockholders' Equity Note [Abstract]

Stockholder's Equity

10. STOCKHOLDERS' EQUITY

Stock-Based Compensation

Restricted Stock Awards

The Incentive Plan, as amended, gives the BOD the authority to grant up to 10.5 million in stock awards consisting of unrestricted stock, stock units, dividend equivalent rights, stock options (incentive and non-qualified), stock appreciation rights, restricted stock, and performance and annual incentive awards. The Incentive Plan limits the maximum number of shares of common stock that may be awarded to any person eligible for an award to 300,000 per calendar year and also limits the total compensation (cash and stock) that can be awarded to a non-employee director to $600,000 in any calendar year. Stock awards available for grant at December 31, 2019 were 2.9 million.

Restricted stock awards granted to employees generally vest over a three-year period. Stock grants made to non-employee WAL directors in 2019 became fully vested on July 1, 2019. The Company estimates the compensation cost for stock grants based upon the grant date fair value. Stock compensation expense is recognized on a straight-line basis over the requisite service period for the entire award. Stock compensation expense related to restricted stock awards and stock options granted to employees are included in Salaries and employee benefits in the Consolidated Income Statement. For restricted stock awards granted to WAL directors, related stock compensation expense is included in Legal, professional, and directors' fees. For the year ended December 31, 2019, the Company recognized $17.4 million in stock-based compensation expense related to these stock grants, compared to $16.6 million in 2018, and $14.3 million in 2017.

In addition, the Company previously granted shares of restricted stock to certain members of executive management that had both performance and service conditions that affect vesting. There were no such grants made during the years ended December 31, 2019 and 2018; however, expense is still being recognized for the grants made in 2017 as they also have a three-year vesting period. For the year ended December 31, 2019, the Company recognized $1.9 million in stock-based compensation expense related to these performance-based restricted stock grants, compared to $2.5 million in 2018, and $2.3 million in 2017.

A summary of the status of the Company’s unvested shares of restricted stock and changes during the years then ended is presented below: 

	December 31,
	2019				2018
	Shares		Weighted Average Grant Date Fair Value		Shares		Weighted Average Grant Date Fair Value
	(in thousands, except per share amounts)
Balance, beginning of period	1,027		$	47.53	1,142		$	36.96
Granted	516		46.04		425		58.02
Vested	(469	)	39.60		(477	)	32.31
Forfeited	(114	)	50.80		(63	)	43.62
Balance, end of period	960		$	49.98	1,027		$	47.53

The total weighted average grant date fair value of all stock awards, including the performance-based restricted stock awards, granted during the years ended December 31, 2019, 2018, and 2017 was $23.7 million, $24.7 million, and $26.1 million, respectively. The total fair value of restricted stock that vested during the years ended December 31, 2019, 2018, and 2017 was $21.3 million, $27.4 million, and $29.1 million, respectively.

As of December 31, 2019, there was $23.0 million of total unrecognized compensation cost related to unvested share-based compensation arrangements granted under the Incentive Plan. That cost is expected to be recognized over a weighted average period of 1.62 years.

Performance Stock Units

The Company grants to members of its executive management performance stock units that do not vest unless the Company achieves a specified cumulative EPS target and a TSR performance measure over a three-year performance period. The number of shares issued will vary based on the cumulative EPS target and relative TSR performance factor that is achieved. The Company estimates the cost of performance stock units based upon the grant date fair value and expected vesting percentage over the three-year performance period. For the year ended December 31, 2019, the Company recognized $6.9 million in stock-based compensation expense related to these performance stock units, compared to $6.4 million and $6.5 million in stock-based compensation expense for such units in 2018 and 2017, respectively.

The three-year performance period for the 2016 grant ended on December 31, 2018, and the Company's cumulative EPS for the performance period exceeded the level required for a maximum award under the terms of the grant. As a result, executive management members were entitled to the maximum award of 202,776 shares, which was paid out in the first quarter of 2019.

The three-year performance period for the 2017 grant ended on December 31, 2019, and the Company's cumulative EPS and TSR performance measure for the performance period exceeded the level required for a maximum award under the terms of the grant. As a result, 163,901 shares will become fully vested and distributed to executive management in the first quarter of 2020.

Common Stock Repurchase

On December 12, 2018, the Company announced that it had adopted a common stock repurchase plan, pursuant to which the Company was authorized to repurchase up to $250 million of its shares of common stock through December 31, 2019. During the year ended December 31, 2019, the Company repurchased 2,822,402 shares of its common stock, pursuant to the repurchase plan. The shares were repurchased at a weighted average price of $42.53, for a total payment of $120.1 million. The Company's common stock repurchase program was renewed through December 2020, authorizing the Company to repurchase up to an additional $250.0 million of its outstanding common stock.

Cash Dividend

During the year ended December 31, 2019, the Company's Board of Directors declared two quarterly cash dividends of $0.25 per share of common stock, totaling $51.3 million.

Treasury Shares

Treasury share purchases represent shares surrendered to the Company equal in value to the statutory payroll tax withholding obligations arising from the vesting of employee restricted stock awards. During the year ended December 31, 2019, the Company purchased treasury shares of 210,657 at a weighted average price of $45.80 per share, compared to 223,125 shares at a weighted average price per share of $57.88 in 2018, and 269,865 shares at a weighted average price per share of $51.16 in 2017.