Share-Based Compensation

6 Months Ended

Jun. 30, 2021

Share-based Payment Arrangement [Abstract]

Share-Based Compensation

Share-Based Compensation

As of June 30, 2021, there were 1,307,945 shares of common stock available for grant under the Tutor Perini Corporation Omnibus Incentive Plan. During the first six months of 2021 and 2020, the Company granted the following share-based instruments: (1) restricted stock units totaling 280,000 and 75,000 with weighted-average fair values per share of $18.59 and $13.93, respectively; and (2) stock options totaling 100,000 and 75,000 with weighted-average fair values per share of $15.21 and $3.94, respectively, and weighted-average per share exercise prices of $19.24 and $25.70, respectively; and (3) unrestricted stock units totaling 96,668 and 194,177 with weighted-average fair values per share of $15.62 and $8.60, respectively.

The fair value of restricted stock units and unrestricted stock 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 stock options granted during the first six months of 2021 was determined using the Black-Scholes model based on the following weighted-average assumptions: (i) expected life of 6.5 years, (ii) expected volatility of 73.74%, (iii) risk-free rate of 1.44%, and (iv) no quarterly dividends. Certain performance-based awards contain market condition components and are valued on the date of grant using a Monte Carlo simulation model. Certain restricted stock unit grants are classified as liabilities because they contain a guaranteed minimum payout. The Company recognized liabilities for these awards totaling approximately $2.9 million and $2.4 million as of June 30, 2021 and December 31, 2020, respectively. The Company paid approximately $0.3 million to settle liability classified awards during each of the six month periods ended June 30, 2021 and 2020.

For the three and six months ended June 30, 2021, the Company recognized, as part of general and administrative expenses, costs for share-based payment arrangements totaling $2.6 million and $5.0 million, respectively, and $3.8 million and $8.3 million for the three and six months ended June 30, 2020, respectively. As of June 30, 2021, the balance of unamortized share-based compensation expense was $13.8 million, which is expected to be recognized over a weighted-average period of 2.2 years.