Stock-Based Compensation

12 Months Ended

Dec. 31, 2023

Share-Based Payment Arrangement [Abstract]

Our shareholders approved the 2014 Omnibus Stock Plan (the "2014 Stock Plan") at our annual meeting of shareholders on May 20, 2014. The 2014 Stock Plan replaced the expired 2004 Omnibus Stock Plan (the "2004 plan") previously approved by the shareholders in 2004. The 2014 Stock Plan is administered by the Compensation Committee of the Board of Directors and has a term of ten years. All directors of the Company and employees of the Company and its subsidiaries are eligible to participate in the 2014 Stock Plan. The 2014 Stock Plan (similar to the 2004 plan) continues the maintenance of the Employee Stock Purchase Plan, as well as provisions for the grant of stock options and other stock-based incentives. The 2014 Stock Plan provides for the grant of five percent of the number of the Company’s common shares outstanding as of the first day of each fiscal year plus the number of common shares that were available for grant of awards, but not granted, in prior years. In no event, however, may the number of common shares available for the grant of awards in any fiscal year exceed ten percent of the common shares outstanding as of the first day of that fiscal year. Common shares subject to an award that is forfeited, terminated, or canceled without having been exercised are generally added back to the number of shares available for grant under the 2014 Stock Plan.

Stock-based compensation expense under all share-based payment plans—our Employee Stock Purchase Plan, stock option plans, stock-settled stock appreciation rights ("SSARs"), and restricted stock units ("RSUs")—included in the results of operations was as follows:


	Year Ended December 31,
	2023		2022		2021
Compensation expense, all share-based payment plans	$	6,723	$	7,930	$	4,625
Income tax benefit	1,293		1,722		793

Stock-based compensation consisted of the following:

Employee Stock Purchase Plan--Under the Employee Stock Purchase Plan, all full-time employees with one year of service are eligible to purchase, through payroll deduction, common shares. Employee purchases under the Employee Stock Purchase Plan are at 85% of the fair market value of the common shares--a 15% discount. Compensation costs are recognized as payroll deductions are made. The 15% discount of total shares purchased under the plan resulted in compensation cost recognized of $1,712 in 2023, $1,824 in 2022 and $1,632 in 2021.

Stock Options Plan--The stock options outstanding were awarded under a graded vesting schedule, measured at fair value, and have a term of ten years. Compensation costs for stock options are recognized over the requisite service period on the straight-line recognition method. Compensation cost recognized for stock options was $217 in 2023, $407 in 2022 and $429 in 2021. Beginning in 2021, management and the Compensation Committee replaced the issuance of stock options with performance-based restricted stock units ("PRSUs") for certain employees.

Stock-Settled Stock Appreciation Rights--A SSAR is an award that allows the recipient to receive common shares equal to the appreciation in the fair market value of our common shares between the date the award was granted and the conversion date of the shares

vested. Effective January 1, 2019, management and the Compensation Committee replaced the issuance of future SSARs with PRSUs for certain management employees. As of December 31, 2022, all outstanding SSARs have vested.

Compensation costs for SSARs are determined using a fair-value method and amortized over the requisite service period. "Intrinsic value" is defined as the amount by which the fair market value of a common share exceeds the grant date price of a SSAR. There was no compensation expense for SSARs in 2023. Compensation expense for SSARs totaled $84 in 2022 and $157 in 2021.

Restricted Stock Units--During the year ended December 31, 2023, the Compensation Committee of the Board of Directors awarded 224,540 PRSUs to certain management employees and 14,378 restricted stock units ("RSUs") to nonemployee directors. The Compensation Committee made similar awards in prior periods. The awards vest over specified periods. The following table summarizes PRSUs and RSUs as of December 31, 2023:


Restricted Stock Units	Number of Stock Units	Weighted- Average Grant Date Value		Weighted- Average Remaining Contractual Life	Unrecognized Compensation Cost		Aggregate Intrinsic Value
Unvested, January 1, 2023	766,267	$	14.95
Granted	238,918	18.29
Forfeited	—	—
Vested	(71,342)	12.18
Unvested, December 31, 2023	933,843	$	16.02	1.3 years	$	5,763	$	19,424
Employee PRSUs	885,572	$	15.97	1.3 years	$	5,388	$	18,420
Nonemployee Director RSUs	48,271	$	16.79	1.4 years	$	375	$	1,004

Compensation cost for PRSUs and RSUs is determined using a fair-value method and amortized on the straight-line recognition method over the requisite service period. "Intrinsic value" is defined as the amount by which the fair market value of a common share exceeds the grant date price of a PRSU or an RSU. Compensation expense on PRSUs and RSUs totaled $4,794 in 2023, $5,615 in 2022 and $2,407 in 2021.

The fair value of each stock-based award was estimated on the date of grant using a binomial option-pricing model. The binomial model considers a range of assumptions related to volatility, risk-free interest rate and employee exercise behavior. Expected volatilities utilized in the binomial model are based on historical volatility of our share prices and other factors. Similarly, the dividend yield is based on historical experience and expected future changes. The binomial model also incorporates exercise and forfeiture assumptions based on an analysis of historical data. The expected life of the stock-based awards is derived from the output of the binomial model and represents the period of time that awards granted are expected to be outstanding.

The fair values of stock-based awards granted were estimated at the dates of grant with the following weighted-average assumptions:


	Year Ended December 31,
	2023		2022		2021
Volatility rate	9.6	%	9.7	%	9.9	%
Risk-free interest rate	4.1	%	1.7	%	.3	%
Expected dividend yield	.4	%	.4	%	.4	%
Expected life of awards (years)	3.0		3.0		3.0

General Stock Option Information--The following table summarizes activity under the stock option plans for the year ended December 31, 2023:


Stock Options	Number of Options Outstanding	Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Life	Unrecognized Compensation Cost		Aggregate Intrinsic Value
Outstanding, January 1, 2023	2,072,949	$	8.59
Granted	—	—
Exercised	(263,318)	7.00
Forfeited	(120,800)	5.80
Outstanding, December 31, 2023	1,688,831	$	9.04	3.4 years	$	155	$	19,861

Exercisable, December 31, 2023	1,488,455	$	8.69	3.1 years			$	18,025

"Intrinsic value" is defined as the amount by which the market price of a common share exceeds the exercise price of an option.

Information regarding the stock options outstanding at December 31, 2023 is summarized below:


	Stock Options Exercise Price		Number Outstanding	Weighted-Average Remaining Contractual Life	Weighted- Average Exercise Price		Number Exercisable	Weighted- Average Exercise Price
Employee options:


	$	6.60	257,324	0.5 years	$	6.60	257,324	$	6.60
	7.53		253,200	1.5 years	7.53		253,200	7.53
	8.18		288,000	2.5 years	8.18		288,000	8.18
	8.80		182,800	3.5 years	8.80		182,800	8.80
	9.55		200,350	4.5 years	9.55		200,350	9.55
	10.55		41,425	5.2 years	10.55		30,305	10.55
	10.55		184,266	5.5 years	10.55		134,928	10.55
	12.10		46,506	6.2 years	12.10		23,788	12.10
	12.10		234,960	6.5 years	12.10		117,760	12.10
			1,688,831	3.4 years	$	9.04	1,488,455	$	8.69

We issue common shares from treasury upon the exercise of stock options and SSARs, the vesting of PRSUs and RSUs or purchases under the Employee Stock Purchase Plan.

Tax Benefits of Stock-Based Compensation--Our total income tax benefit from share-based awards--as recognized in our consolidated statement of operations--for the last three years was: $1,293 in 2023, $1,722 in 2022, and $793 in 2021. Tax benefits for share-based awards are accrued as stock compensation expense and recognized in our consolidated statement of operations. Tax benefits on share-based awards are realized when: (a) SSARs are exercised; (b) PRSUs and RSUs vest; and (c) stock options are exercised.

When actual tax benefits realized exceed the tax benefits accrued for share-based awards, we realize an excess tax benefit. We had excess tax benefits of: $1,109 in 2023, $1,067 in 2022, and $1,102 in 2021.