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Stockholders' Equity (Tables)
 12 Months Ended
Dec. 31, 2023
Summary of Common Stock Issuances During the years ended December 31, the Company issued the following shares of common stock:

 

 

 

2023

 

 

2022

 

 

2021

 

 

 

Shares

 

 

Average
Price
per Share

 

 

Total

 

 

Shares

 

 

Average
Price
per Share

 

 

Total

 

 

Shares

 

 

Average
Price
per Share

 

 

Total

 

Common stock issued
   in connection
   with follow-on
   offering

 

 

—

 

 

$

—

 

 

$

—

 

 

 

—

 

 

$

—

 

 

 

—

 

 

 

2,875,000

 

 

$

59.05

 

 

$

169,783

 

Acquisitions

 

 

86,577

 

 

 

30.01

 

 

 

2,598

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

178,721

 

 

 

46.55

 

 

 

8,320

 

Exercise of warrants (1)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

67,713

 

 

 

17.19

 

 

 

—

 

Exercise of options

 

 

239,358

 

 

 

19.59

 

 

 

4,690

 

 

 

101,340

 

 

 

16.21

 

 

 

1,643

 

 

 

959,890

 

 

 

7.54

 

 

 

7,237

 

Restricted shares, net (1)

 

 

90,815

 

 

 

36.77

 

 

 

—

 

 

 

25,532

 

 

 

66.30

 

 

 

—

 

 

 

42,263

 

 

 

30.69

 

 

 

—

 

Payment of earn-out
   liability and purchase
   price true up

 

 

26,688

 

 

 

37.47

 

 

 

1,000

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

563,807

 

 

 

46.26

 

 

 

26,084

 

   Total

 

 

443,438

 

 

$

26.22

 

 

$

8,288

 

 

 

126,872

 

 

$

26.29

 

 

$

1,643

 

 

 

4,687,394

 

 

$

45.63

 

 

$

211,424

 

___________________________

(1) Represents the non-cash release of shares of common stock due to the exercise of warrants and the vesting of restricted stock.
Schedule of Share Authorized to be Issue and Available for Grant The following number of shares were authorized to be issued and available for grant as of December 31:

 

 

2017 Plan

 

 

2023

 

 

2022

 

 

2021

 

Shares authorized to be issued

 

6,330,713

 

 

 

5,140,112

 

 

 

3,944,750

 

Shares available for grant(1)

 

662,662

 

 

 

367,243

 

 

 

23,153

 

 

 

 

 

 

 

 

 

 

 

2013 Plan

 

 

2023

 

 

2022

 

 

2021

 

Shares authorized to be issued

 

2,036,219

 

 

 

2,037,019

 

 

 

2,047,269

 

Shares available for grant

 

—

 

 

 

—

 

 

 

—

 

 

 

 

 

 

 

 

 

 

_______________________

(1) In January 2023 and January 2022 the Board of Directors ratified the addition of 1,189,801 and 1,185,112 shares of common stock, respectively, to the number of shares available for issuance under the 2017 Plan pursuant to the annual increase provision of such plan. Unless the Board of Directors determines otherwise, additional annual increases will be effective on each January 1, through January 1, 2027. The 2017 Plan permits the company to settle awards, if and when vested, in cash at its discretion. Pursuant to the terms of the 2017 Plan, the number of shares authorized for issuance thereunder will only be reduced with respect to shares of common stock actually issued upon exercise or settlement of an award. Shares of common stock subject to awards that have been canceled, expired, forfeited or otherwise not issued under an award and shares of common stock subject to awards settled in cash do not count as shares of common stock issued under the 2017 Plan. The Company expects to have sufficient shares available under the 2017 Plan to satisfy the future settlement of outstanding awards. Shares reserved for future issuance include 3,000,000 shares underlying the 3,000,000 performance stock appreciation rights granted in December 2021 that are subject to vesting based on the achievement of certain market conditions. Assuming achievement at the highest price performance hurdle, approximately 2,000,000 shares of common stock would be issued upon vesting of these performance SARs. To date, none of the market conditions have been achieved. Shares available for grant exclude these awards of stock appreciation rights approved in December 2021 that are subject to vesting based on the achievement of certain market conditions. To date, none of the market conditions, have been, and they may not be, achieved. See footnote 1 to the table in Common Stock Reserved for Future Issuance below for additional information on stock appreciation rights.

Schedule of Stock Compensation Expense

Total stock compensation expense for the Plans was as follows:

 

 

 

2023

 

 

 

2017 plan

 

 

2013 plan

 

 

 

 

 

 

Options

 

 

Restricted Stock

 

 

SARs

 

 

Options

 

 

Total

 

Cost of revenue

 

$

1,685

 

 

$

1,661

 

 

$

—

 

 

$

—

 

 

$

3,346

 

Selling, general and administrative expense

 

 

4,885

 

 

 

29,851

 

 

 

9,185

 

 

 

—

 

 

 

43,921

 

   Total

 

$

6,570

 

 

$

31,512

 

 

$

9,185

 

 

$

—

 

 

$

47,267

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2022

 

 

 

2017 plan

 

 

2013 plan

 

 

 

 

 

 

Options

 

 

Restricted Stock

 

 

SARs

 

 

Options

 

 

Total

 

Cost of revenue

 

$

1,507

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

1,507

 

Selling, general and administrative expense

 

 

8,531

 

 

 

23,972

 

 

 

9,280

 

 

 

—

 

 

 

41,783

 

   Total

 

$

10,038

 

 

$

23,972

 

 

$

9,280

 

 

$

—

 

 

$

43,290

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2021

 

 

 

2017 plan

 

 

2013 plan

 

 

 

 

 

 

Options

 

 

Restricted Stock

 

 

SARs

 

 

Options

 

 

Total

 

Cost of revenue

 

$

1,482

 

 

$

—

 

 

$

—

 

 

$

10

 

 

$

1,492

 

Selling, general and administrative expense

 

 

6,552

 

 

 

1,959

 

 

 

307

 

 

 

11

 

 

 

8,829

 

   Total

 

$

8,034

 

 

$

1,959

 

 

$

307

 

 

$

21

 

 

$

10,321

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
Summary of Performance Hurdles The performance hurdles shall be deemed achieved if the average trading price per share of the Company’s common stock equals or exceeds the following stock prices:

 

SARs Stock Price Performance Hurdle

 

Portion of SARs Subject to Performance Hurdle

$

133.58

 

1/3

$

166.98

 

1/3

$

200.37

 

1/3
Summary of Weighted Average Assumptions Used in Black-Sholes Option-pricing Model

The following weighted-average assumptions were used in the Black-Sholes option-pricing model calculation for the years ended December 31:

 

 

 

2023

 

 

2022

 

 

2021

 

Common stock value (per share)

 

$

32.41

 

 

$43.74

 

 

$44.28

 

Expected volatility

 

 

33.55

%

 

 

33.44

%

 

 

55.34

%

Risk- free interest rate

 

 

3.77

%

 

 

2.03

%

 

 

0.82

%

Expected life (years)

 

 

7.00

 

 

6.98

 

 

6.40

 

Forfeiture rate

 

None

 

 

None

 

 

None

 

Dividend rate

 

None

 

 

None

 

 

None

 

 
Schedule of Common Stock Reserved for Future Issuance

Common Stock Reserved for Future Issuances—At December 31, the Company has reserved certain stock of its authorized but unissued common stock for possible future issuance in connection with the following:

 

 

2023

 

 

2022

 

 

2021

 

Montrose 2013 Stock Incentive Plan

 

792,191

 

 

 

855,695

 

 

 

2,047,269

 

Montrose 2017 Stock Incentive Plan(1)

 

8,647,656

 

 

 

7,724,524

 

 

 

6,921,597

 

Total

 

9,439,847

 

 

 

8,580,219

 

 

 

8,968,866

 
Montrose Amended & Restated 2017 Stock Incentive Plan  
Schedule of Restricted Stock Activity

 

 

2023

 

 

Shares

 

Average Price per Share

 

Total
(in thousands)

 

Awards granted

 

793,133

 

$

34.33

 

$

27,231

 

Awards forfeited

 

(11,311

)

 

32.13

 

 

363

 

Awards vested

 

90,815

 

 

36.77

 

 

3,339

 

 

 

 

 

 

 

2022

 

 

Shares

 

Average Price per Share

 

Total
(in thousands)

 

Awards granted

 

106,324

 

$

46.82

 

$

4,978

 

Awards vested

 

25,532

 

 

31.27

 

 

798,470

 

 

 

 

 

 

 

2021

 

 

Shares

 

Average Price per Share

 

Total
(in thousands)

 

Awards granted

 

1,690,700

 

$

66.45

 

$

112,347

 

Awards vested

 

42,263

 

 

30.68

 

 

1,296,522

 
Summary of Stock Option Activity The following summarizes the options activity of the 2017 Plan for the years ended December 31, 2023, 2022 and 2021:

 

 

 

Options to Purchase Common Stock

 

 

Weighted-Average Exercise Price per Share

 

 

Weighted Average Grant Date Fair Value per Share

 

 

Weighted Average Remaining Contract Life (in Years)

 

 

Aggregate Intrinsic Value of In-The-Money Options (in Thousands)

 

Outstanding at January 1, 2021

 

 

1,840,229

 

 

$

23

 

 

$

12

 

 

 

9.09

 

 

$

15,598

 

Granted

 

 

300,620

 

 

 

44

 

 

 

23

 

 

 

—

 

 

 

—

 

Forfeited/cancelled

 

 

(33,875

)

 

 

28

 

 

 

—

 

 

 

—

 

 

 

—

 

Expired

 

 

(1,550

)

 

 

19

 

 

 

—

 

 

 

—

 

 

 

—

 

Exercised

 

 

(68,695

)

 

 

22

 

 

 

—

 

 

 

—

 

 

 

2,169

 

Outstanding at December 31, 2021

 

 

2,036,729

 

 

$

26

 

 

$

14

 

 

 

8.30

 

 

$

91,030

 

Granted

 

 

698,534

 

 

 

44

 

 

 

16

 

 

 

—

 

 

 

—

 

Forfeited/cancelled

 

 

(96,211

)

 

 

32

 

 

 

—

 

 

 

—

 

 

 

—

 

Exercised

 

 

(59,486

)

 

 

23

 

 

 

—

 

 

 

—

 

 

 

1,398

 

Outstanding at December 31, 2022

 

 

2,579,566

 

 

$

31

 

 

$

15

 

 

 

7.76

 

 

$

37,295

 

Granted

 

 

253,980

 

 

 

32

 

 

 

14

 

 

 

—

 

 

 

—

 

Forfeited/cancelled

 

 

(134,170

)

 

 

36

 

 

 

—

 

 

 

—

 

 

 

—

 

Expired

 

 

(6,450

)

 

 

32

 

 

 

—

 

 

 

—

 

 

 

—

 

Exercised

 

 

(176,654

)

 

 

24

 

 

 

—

 

 

 

—

 

 

 

3,726

 

Outstanding at December 31, 2023

 

 

2,516,272

 

 

$

31

 

 

$

16

 

 

 

7.03

 

 

$

13,825

 

Exercisable at December 31, 2023

 

 

1,373,313

 

 

 

30

 

 

 

—

 

 

 

6.44

 

 

 

8,198

 
Montrose Amended and Restated 2013 Stock Option Plan  
Summary of Stock Option Activity The following summarizes the activity of the 2013 Plan for the years ended December 31, 2023, 2022 and 2021:

 

 

 

Options to Purchase Common Stock

 

 

Weighted-Average Exercise Price per Share

 

 

Weighted Average Grant Date Fair Value per Share

 

 

Weighted Average Remaining Contract Life (in Years)

 

 

Aggregate Intrinsic Value of In-The-Money Options (in Thousands)

 

Outstanding at January 1, 2021

 

 

1,787,869

 

 

$

6

 

 

$

1

 

 

 

5.40

 

 

$

43,867

 

Expired

 

 

(625

)

 

 

6

 

 

 

—

 

 

 

—

 

 

 

—

 

Exercised

 

 

(889,570

)

 

 

6

 

 

 

—

 

 

 

—

 

 

 

45,161

 

Outstanding at December 31, 2021

 

 

897,674

 

 

$

6

 

 

$

2

 

 

 

4.37

 

 

$

57,529

 

Expired

 

 

(125

)

 

 

6

 

 

 

—

 

 

 

—

 

 

 

—

 

Exercised

 

 

(41,854

)

 

 

6

 

 

 

—

 

 

 

—

 

 

 

1,626

 

Outstanding at December 31, 2022

 

 

855,695

 

 

$

6

 

 

$

2

 

 

 

3.31

 

 

$

32,478

 

Expired

 

 

(800

)

 

 

6

 

 

 

—

 

 

 

—

 

 

 

—

 

Exercised

 

 

(62,704

)

 

 

7

 

 

 

—

 

 

 

—

 

 

 

1,950

 

Outstanding at December 31, 2023

 

 

792,191

 

 

$

6

 

 

$

2

 

 

 

2.38

 

 

$

20,380

 

Exercisable at December 31, 2023

 

 

792,191

 

 

 

6

 

 

 

—

 

 

 

2.38

 

 

 

20,380