Share-Based Compensation

6 Months Ended

Jun. 30, 2018

Share-Based Compensation [Abstract]

Share-Based Compensation

(10)     Share-Based Compensation

During the second quarter of 2018, the Company adopted the Tutor Perini Corporation Omnibus Incentive Plan (the “Plan”), which effected the merger of the Company’s previous incentive compensation plans. Similar to its previous plans, the Plan provides for various types of share-based grants, including restricted and unrestricted stock units and stock options. As of June 30, 2018, there were 684,598 shares of common stock available for grant under the Company’s Plan. During the first six months of 2018 and 2017, the Company issued the following share-based instruments: (1) restricted stock units of 614,000 and 665,000 with weighted-average fair values per share of $25.19 and $30.48, respectively; (2) stock options of 579,000 and 265,000 with weighted-average fair values per share of $11.45 and $13.70, respectively, and weighted-average per share exercise prices of $23.73 and $23.47, respectively. In addition, during the six months ended June 30, 2018 and 2017, the Company issued 115,420 and 99,155 unrestricted stock units with a weighted-average fair value per share of $21.26 and $26.26, respectively.

The fair value of restricted and unrestricted stock units is based on the closing price of the Company’s common stock on the New York Stock Exchange on the date of the grant and the fair value of stock options is based on the Black-Scholes model. The fair value of certain performance-based awards are estimated taking into account the features of such awards. The fair value of stock options granted during the first six months of 2018 was determined using the Black-Scholes model based on the following weighted-average assumptions: (i) expected life of 5.1 years, (ii) expected volatility of 42.31%, (iii) risk-free rate of 2.57%, and (iv) no quarterly dividends.

For the three and six months ended June 30, 2018, the Company recognized, as part of general and administrative expenses, costs for share-based payment arrangements totaling $6.0 million and $12.1 million, respectively, and $6.1 million and $10.4 million for the three and six months ended June 30, 2017, respectively. As of June 30, 2018, the balance of unamortized share-based compensation expense was $36.4 million, which will be recognized over a weighted-average period of 2.2 years.