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Stock-Based Compensation
3 Months Ended
Mar. 31, 2017
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Stock-Based Compensation
STOCK-BASED COMPENSATION
 
The Company maintains equity plans that provide for the grant of options, stock appreciation rights, restricted stock awards, restricted stock units (“RSUs”), performance stock units (“PSUs”), dividend equivalents, cash incentive awards and other stock-based awards. Additionally, the Company maintains an Employee Stock Purchase Plan (“ESPP”) in which eligible employees can purchase common stock on specified dates at 85% of the lower of the fair market value of the Company’s common stock at the beginning or end of the respective six-month offering period.

On January 13, 2017, the Compensation Committee of the Board of Directors of the Company approved the grant of PSU awards (the “2017 PSUs”) to the Company’s named executive officers and certain other employees pursuant to the Company’s 2016 Incentive Award Plan. The award agreement for the 2017 PSUs (the “2017 PSU Grant Form”) provides, among other things, that (i) each 2017 PSU that vests represents the right to receive one share of the Company’s common stock; (ii) the 2017 PSUs vest based on the Company’s achieving specified performance measurements over a performance period of three years, beginning January 1, 2017; (iii) the performance measurements include revenue and EBITDA, each as defined in the 2017 PSU Grant Form; (iv) threshold, target and maximum payout opportunities established for the 2017 PSUs will be used to calculate the number of shares that will be issuable when the award vests, which may range from 0% to 200% of the target amount; (v) any 2017 PSUs that are earned are scheduled to vest and be settled in shares of the Company’s common stock at the end of the performance period; (vi) all or a portion of the 2017 PSUs may vest following a change of control, a termination of service without cause or for good reason or a termination of service by reason of death or disability (each as described in greater detail in the 2017 PSU Grant Form); and (vii) except as provided above, any unvested 2017 PSUs will be forfeited upon a recipient’s termination of employment with the Company.

With respect to the 2017 PSUs, the number of shares that vest and are issued to the recipient is based upon the Company’s performance as measured against the specified targets at the end of the three-year performance period as determined by the Compensation Committee of the Board of Directors. The Company estimates the fair value of the 2017 PSUs based on its closing stock price at the time of grant and the number of shares that will vest based on the probability of achieving such performance targets and records compensation expense over the performance period of the award. Over the performance period, the number of 2017 PSUs that will ultimately vest, the shares of common stock that will be issued and the related compensation expense is adjusted based upon the Company’s estimate of achieving such performance targets. The number of shares delivered to recipients and the related compensation cost recognized as an expense will be based on the actual performance metrics as set forth in the applicable 2017 PSU award agreement.

At March 31, 2017, there were 2.6 million additional shares available for future issuance under the Company’s incentive award plans, assuming issuance of common stock underlying (i) all outstanding PSUs granted in 2016 (the “2016 PSUs”) and the 2017 PSUs at target performance and (ii) the remaining unvested portion of the earned PSUs that were granted to certain of the Company’s officers in June 2014 and to the Company’s Chief Financial Officer in September 2015 upon commencement of her employment (the “2014 PSUs”) at a 97% payout. At March 31, 2017, there were 1.9 million additional shares available, assuming issuance of common stock underlying all outstanding 2016 PSUs and 2017 PSUs at maximum performance and the remaining unvested portion of the earned 2014 PSUs at a 97% payout. At March 31, 2017, there were approximately 0.8 million additional shares available for future issuance under the ESPP.

For the three months ended March 31, 2017 and 2016 amounts charged against income for share-based payment arrangements were $3.8 million and $3.4 million, respectively. For the three months ended March 31, 2017 and 2016, amounts charged against income for compensation expense related to the ESPP were $0.3 million and $0.4 million, respectively.

As of March 31, 2017, there was $28.0 million of total unrecognized compensation expense related to share-based compensation arrangements granted under the Company’s incentive award plans, using the Company’s current estimate of performance for the PSUs, which could be higher or lower in the future based on the actual achievement of performance targets.

The weighted average grant date fair value of options granted during the three months ended March 31, 2017 and 2016 were $12.19 and $6.54, respectively.
During the three months ended March 31, 2017, the Company made equity compensation grants consisting of 76,034 stock options, 325,703 RSUs, and 117,829 PSUs.