XML 30 R19.htm IDEA: XBRL DOCUMENT v3.20.2
Stock-Based Compensation
6 Months Ended
Jul. 03, 2020
Share-based Payment Arrangement [Abstract]  
Stock-Based Compensation
STOCK-BASED COMPENSATION
        We maintain an equity incentive plan (the 2014 Omnibus Plan) to govern awards granted to Vectrus employees and directors, including nonqualified stock options (NQOs), restricted stock units (RSUs), total shareholder return (TSR) awards and other awards. We account for NQOs and stock-settled RSUs as equity-based compensation awards. TSR awards, described below, and cash-settled RSUs are accounted for as liability-based compensation awards.
        Stock-based compensation expense and the associated tax benefits impacting our Condensed Consolidated Statements of Income were as follows:
Three Months EndedSix Months Ended
(In thousands)July 3, 2020June 28, 2019July 3, 2020June 28, 2019
Compensation costs for equity-based awards$1,282  $1,099  $3,002  $2,216  
Compensation costs for liability-based awards1,762  1,470  2,409  1,815  
Total compensation costs, pre-tax$3,044  $2,569  $5,411  $4,031  
Future tax benefit$658  $556  $1,169  $872  
        Liability-based awards are revalued at the end of each reporting period to reflect changes in fair value.
        As of July 3, 2020, total unrecognized compensation costs related to equity-based awards and liability-based awards were $7.6 million and $5.4 million, respectively, which are expected to be recognized ratably over a weighted average period of 1.85 years and 1.89 years, respectively.
        The following table provides a summary of the activities for NQOs and RSUs for the three months ended July 3, 2020:
NQOsRSUs
(In thousands, except per share data)SharesWeighted Average Exercise Price Per ShareSharesWeighted Average Grant Date Fair Value Per Share
Outstanding at January 1, 202077  $23.30  301  $30.30  
Granted—  $—  126  $52.14  
Exercised(3) $21.43  —  $—  
Vested—  $—  (144) $52.72  
Forfeited or expired—  $—  (12) $49.26  
Outstanding at July 3, 202074  $23.37  271  $39.93  
        During the six months ended June 28, 2019, we granted long term incentive awards to employees consisting of 105,737 RSUs with a weighted average grant date fair value per share of $52.98 and to our directors consisting of 20,311 RSUs with a weighted average grant date fair value per share of $47.76.
        For employee RSUs, one-third of the award vests on each of the three anniversary dates following the grant date. Director RSUs are granted on the date of an annual meeting of shareholders and vest on the business day immediately prior to the next annual meeting. The fair value of each RSU grant was determined based on the closing price of Vectrus common stock on the date of grant. Stock compensation expense will be recognized ratably over the vesting period of the awards.
Total Shareholder Return Awards
        TSR awards are performance-based cash awards that are subject to a three-year performance period. Any payments earned are made in cash following completion of the performance period according to the achievement of specified performance goals. During the six months ended July 3, 2020, we granted TSR awards with an aggregate target TSR value of $3.1 million. The fair value of TSR awards is measured quarterly and is based on the Company’s performance relative to the performance of the Aerospace and Defense Companies in the S&P 1500 Index. Depending on the Company’s performance during the three-year performance period, payments can range from 0% to 200% of the target value.