Stock-Based Compensation

12 Months Ended

Dec. 31, 2020

Share-based Payment Arrangement [Abstract]

Stock-Based Compensation

17. Stock-Based Compensation

The Company’s stock-based compensation plans authorize awards of restricted stock units (“RSUs”), stock options and other equity-related awards to employees, officers, directors and other service providers of the Company and its affiliates. In May 2019, in conjunction with the Company’s stockholders approving the 2018 Omnibus Incentive Plan (the “2018 Plan”), which authorizes a total of 2,550,000 shares to be issued pursuant to awards thereunder, the balances available for awards under the Company’s predecessor plans (i.e., the 2016 Long-Term Incentive Plan and the Second Long-Term Incentive Plan) (collectively, the “Prior Plans”) were terminated. Although outstanding awards under the Prior Plans remain governed by the terms of the Prior Plans, no new awards will be granted or become available for grant under the Prior Plans.

As of December 31, 2020, there were (i) 2,411,319 shares subject to outstanding awards under the Prior Plans, including 1,092,633 shares subject to market-price vesting conditions, and (ii) 1,734,937 shares subject to outstanding awards under the 2018 Plan, including 100,000 shares subject to performance-based target awards and 241,077 shares subject to awards that were previously subject to performance criteria that were determined to be met in June 2020 (at a level equal to approximately 87% of the target awards) which awards continue to remain subject to a time-based vesting schedule. As of December 31, 2020, there were 267,311 shares available for new awards under the 2018 Plan and no shares available for new awards under the Prior Plans. All awards consist of RSUs and Restricted Stock. The Compensation Committee of the Board has authority to determine the terms and conditions applicable to awards, subject to the terms of the plan, including the vesting schedules of awards. Awards typically vest over a period of one to four years.

The Company also has an employee stock purchase plan (“ESPP”) that authorizes the issuance of up to an aggregate of 500,000 shares of common stock pursuant to purchases thereunder by employees. The ESPP, which was approved by stockholders in July 2017, is administered by the Compensation Committee which has discretion to designate the length of offering periods and other terms subject to the requirements of the ESPP. The Company held a twelve-month offering period under the ESPP that began on June 3, 2019 and ended on June 2, 2020. This offering period authorized employees to contribute up to 10% of their base compensation to purchase a maximum of 1,000 shares at a discounted purchase price that would be equal 85% of the lower of: (i) the closing price at the beginning of the offering period and (ii) the closing price at the end of the offering period. A total of 7,649 shares were purchased on the last day of the offering period, June 2, 2020, at a discounted price of $3.2215 per share. As of December 31, 2020, a total of 467,751 shares remain available for purchase under the ESPP.

A summary of the Company’s RSU activity is as follows:

	Number of Shares			Weighted Average Grant Date Fair Value Per Share
Unvested Outstanding at January 1, 2020		1,571,964		$	6.43
Granted (1)		1,117,039		$	4.13
Forfeited		(47,613	)	$	(6.59	)
Vested (2)		(492,272	)	$	(6.58	)
Unvested Outstanding at December 31, 2020		2,149,118		$	5.20

(1) The RSUs that were granted during the year ended December 31, 2020 included: (a) 47,405 RSUs under the Board’s compensation program for non-employee directors which vest during the year of grant and remain unsettled until the director leaves the Company; (b) 769,634 RSUs under an incentive program for management and other personnel which vest in installments through December 31, 2022; (c) 200,000 RSUs as a sign-on award under our new employment contract with our President and Chief Operating Officer as to which 100,000 RSUs vest in installments through December 31, 2023 and 100,000 RSUs are subject to annual performance conditions for each year through 2023; and (d) 100,000 RSUs as a sign-on award under our new employment agreement with our Executive Chairman which vests on June 30, 2021. In addition, such agreement with our Executive Chairman provides that he would receive a further 750,000 RSUs as special grants (a mix of time-based RSUs, performance-based RSUs and stock-price based RSUs) during the year ending December 31, 2021, subject to the condition that our stockholders approve an increase in our equity incentive plan share authorization limit at the annual meeting of our stockholders to be held during 2021. The provisions under the agreement with respect to the award of these RSUs would not be implemented if such approval by stockholders is not obtained during 2021.

(2) The RSUs that vested during the year ended December 31, 2020 included: (a) 214,998 RSUs that remain subject to deferred settlement terms such that the awards do not settle until the participant’s services terminate; and (b) 269,867 RSUs that vested on December 31, 2020, resulting in 163,732 shares being issued in settlement thereof and 106,135 withheld for taxes (the processing of the issuance and delivery of such 163,732 shares did not occur until January 2021).

The Company issued 25,099 shares during the year ended December 31, 2020 in connection with the settlement of RSUs held by a director whose services ended and issued a total of 166,959 shares during the year ended December 31, 2020 in connection with the net settlement of RSUs that vested during the preceding year (on December 31, 2019).

Stock-based compensation is recognized as an expense on a straight-line basis over the requisite service period, which is generally the vesting period. For performance awards that are contingent upon the Company achieving certain pre-determined financial performance targets, compensation expense is calculated based on the number of shares expected to vest after assessing the probability that the performance criteria will be met. Determining the probability of achieving a performance target requires estimates and judgment.

The Company recognized stock-based compensation expense as follows:

	Year Ended December 31, 2020		Year Ended December 31, 2019
	(in millions)
RSAs and RSUs	$	4.6	$	8.7
Payroll taxes on vesting of RSUs		0.2		0.3
	$	4.8	$	9.0

Total unrecognized compensation expense related to unvested stock awards and unvested RSUs at December 31, 2020 amounts to $6.1 million and is expected to be recognized over a weighted average period of 1.2 years.