STOCK-BASED COMPENSATION

3 Months Ended

Mar. 31, 2024

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION

7.    STOCK-BASED COMPENSATION

The Company has issued various forms of stock incentives, including, incentive and non-qualified stock options, time-lapse restricted shares and performance share unit awards under its Stock Incentive Plans to officers, selected employees and non-employee directors.

In the first quarter of 2024, the Company issued time-lapse restricted shares to some of the selected employees that will vest ratably over a period of three years. The officers and remaining selected employees of the Company are likely to be granted shares under the 2024 Stock Incentive Plan. The Company’s 2014 Stock Incentive Plan expired in April 2024. At the April 23, 2024, annual meeting of stockholders, the 2024 Stock Incentive Plan reserving 8,000,000 shares was approved.

In addition to time-lapse restricted shares, officers and selected employees are also eligible to receive performance share unit awards that vest at different levels based on pre-established financial performance targets with a modifier for stock performance based on total shareholder return. The Company periodically evaluates the portion of performance share unit awards that are probable to vest and updates compensation expense accruals accordingly.

As of March 31, 2024, there were 258,122 shares available under the Company’s 2014 Stock Incentive Plan that are reserved for issuance of shares that vest pursuant to the satisfaction of the terms of performance share unit awards.

Stock-based employee compensation for both the time-lapse restricted shares and performance share awards, was as follows:

	Three months ended
	March 31,
(in thousands)	2024		2023
Pre-tax expense	$	1,926	$	1,802
After tax expense	$	1,477	$	1,382

The following is a summary of the changes in non-vested restricted shares for the three months ended March 31, 2024:

		Weighted Average
	Shares	Grant-Date Fair Value
Non-vested shares at January 1, 2024	3,532,185	$	7.35
Granted	739,200		6.64
Vested	(1,011,633)		8.15
Forfeited	(85,325)		6.76
Non-vested shares at March 31, 2024	3,174,427	$	6.94

The total fair value of shares vested was $7.4 million during both the three months ended March 31, 2024, and the three months ended March 31, 2023. Excess tax benefits (beneficial) or deficits (detrimental) realized from tax compensation deductions in excess of, or lower than, compensation expense are recorded as discrete income tax adjustments. For the three months ended March 31, 2024, $163 thousand related to stock-based compensation awards was recorded as a beneficial discrete tax adjustment and classified within Net cash provided by operating activities in the accompanying Consolidated Statements of Cash Flows compared to $133 thousand of beneficial discrete tax adjustment for the three months ended March 31, 2023.

The table above does not include any of the activity related to performance share unit awards since they are not currently issued or vested.