Stock-Based Compensation

12 Months Ended

Dec. 31, 2021

Share-based Payment Arrangement [Abstract]

11. Stock-Based Compensation

Restricted Stock Units

We maintain a Long-Term Incentive Plan ("LTIP") for employees, consultants and directors of the Company and its affiliates who perform services for the Company. The purpose of the LTIP is to provide a means to attract and retain individuals to serve as directors, employees and consultants who provide services to the Company by affording such individuals a means to acquire and maintain ownership of awards, the value of which is tied to the performance of the Company’s Class A common stock. The LTIP provides for grants of cash payments, stock options, stock appreciation rights, restricted stock or units, bonus stock, dividend equivalents, and other stock-based awards with the total number of shares of stock available for issuance under the LTIP not to exceed 2,750,000 shares.

Restricted stock units granted to our officers, employees, non-employee directors and certain employees of our affiliates who perform services for the Company vest over approximately one year for non-employee directors and ratably over approximately one to four years for officers, employees, and employees of affiliates, with the initial vesting date occurring in May of the subsequent year. Each restricted stock unit is entitled to receive a dividend equivalent when dividends are declared and distributed to shareholders of Class A common stock. These dividend equivalents are retained by the Company, reinvested in additional restricted stock units effective as of the record date of such dividends and vested upon the same schedule as the underlying restricted stock unit.

The Company measures the cost of awards classified as equity awards based on the grant date fair value of the award, and the Company measures the cost of awards classified as liability awards at the fair value of the award at each reporting period. The Company has utilized an estimated 10% annual forfeiture rate of restricted stock units in determining the fair value for all awards excluding those issued to executive level recipients and non-employee directors, for which no forfeitures are estimated to occur. The Company has elected to recognize related compensation expense on a straight-line basis over the associated vesting periods.

Although the restricted stock units allow for cash settlement of the awards at the sole discretion of management of the Company, management intends to settle the awards by issuing shares of the Company’s Class A common stock.

Total stock-based compensation expense for the years ended December 31, 2021, 2020 and 2019 was $3.4 million, $2.5 million and $5.5 million. Total income tax benefit related to stock-based compensation recognized in net income (loss) was $0.4 million, $0.3 million and $0.6 million for the years ended December 31, 2021, 2020 and 2019.

Equity Classified Restricted Stock Units

Restricted stock units issued to employees and officers of the Company are classified as equity awards. The fair value of the equity classified restricted stock units is based on the Company’s Class A common stock price as of the grant date. The Company recognized stock based compensation expense of $3.1 million, $2.4 million and $5.0 million for the years ended December 31, 2021, 2020 and 2019, respectively, in general and administrative expense with a corresponding increase to additional paid in capital. The following table summarizes equity classified restricted stock unit activity and unvested restricted stock units for the year ended December 31, 2021:


	Number of Shares (in thousands)	Weighted Average Grant Date Fair Value










Unvested at December 31, 2020	305	$9.48
Granted	394	10.67
Dividend reinvestment issuances	27	10.79
Vested	(319)	10.90
Forfeited	(14)	10.56
Unvested at December 31, 2021	393	$10.35

For the year ended December 31, 2021, 319,351 restricted stock units vested, with 211,154 shares of Class A common stock distributed to the holders of these units and 108,197 shares of Class A common stock withheld by the Company to cover taxes owed on the vesting of such units. As of December 31, 2021, there was $2.9 million of total unrecognized compensation cost related to the Company’s equity classified restricted stock units, which is expected to be recognized over a weighted average period of approximately 3.0 years.

Change in Control Restricted Stock Units

In 2018, the Company granted Change in Control Restricted Stock Units ("CIC RSUs") to certain officers that vest upon a "Change in Control", if certain conditions are met. The terms of the CIC RSUs define a "Change in Control" to generally mean:

–the consummation of an agreement to acquire or tender offer for beneficial ownership by any person, of 50% or more of the combined voting power of our outstanding voting securities entitled to vote generally in the election of directors, or by any person of 90% or more of the then total outstanding shares of Class A common stock;

–individuals who constitute the incumbent board cease for any reason to constitute at least a majority of the board;

–consummation of certain reorganizations, mergers or consolidations or a sale or other disposition of all or substantially all of our assets;

–approval by our stockholders of a complete liquidation or dissolution;

–a public offering or series of public offerings by Retailco and its affiliates, as a selling shareholder group, in which their total interest drops below 10 million of our total outstanding voting securities;

–a disposition by Retailco and its affiliates in which their total interest drops below 10 million of our total outstanding voting securities; or

–any other business combination, liquidation event of Retailco and its affiliates or restructuring of us which the Compensation Committee deems in its discretion to achieve the principles of a Change in Control.

The equity classified restricted stock unit table above excludes unvested CIC RSUs as the conditions for Change in Control have not been met. The Company has not recognized stock compensation expense related to the CIC RSUs as the Change in Control conditions have not been met.

Liability Classified Restricted Stock Units

Restricted stock units issued to non-employee directors of the Company and employees of certain of our affiliates are classified as liability awards as the awards are either to a) non-employee directors that allow for the recipient to choose net settlement for the amount of withholding taxes dues upon vesting or b) to employees of certain affiliates of the Company and are therefore not deemed to be employees of the Company. The fair value of the liability classified restricted stock units is based on the Company’s Class A common stock price as of the reported period ending date. The Company recognized stock based compensation expense of $0.3 million, $0.1 million and $0.5 million for years ended December 31, 2021, 2020 and 2019, respectively, in general and administrative expense with a corresponding increase to liabilities. As of December 31, 2021 and 2020, the Company’s liabilities related to these restricted stock units recorded in current liabilities was $0.2 million and $0.1 million, respectively. The

following table summarizes liability classified restricted stock unit activity and unvested restricted stock units for the year ended December 31, 2021:


	Number of Shares (in thousands)	Weighted Average Reporting Date Fair Value










Unvested at December 31, 2020	37	$9.57
Granted	8	11.43
Dividend reinvestment issuances	1	11.43
Vested	(23)	10.70
Forfeited	—	—
Unvested at December 31, 2021	23	$11.43

For the year ended December 31, 2021, 23,052 restricted stock units vested, with 7,987 shares of Class A common stock distributed to the holders of these units and 15,065 shares of Class A common stock withheld by the Company to cover taxes owed on the vesting of such units. As of December 31, 2021, there was $0.1 million of total unrecognized compensation cost related to the Company’s liability classified restricted stock units, which is expected to be recognized over a weighted average period of approximately 0.4 years.