Stock-Based Compensation

3 Months Ended

Dec. 31, 2023

Share-Based Payment Arrangement [Abstract]

Refer to our Annual Report on Form 10-K for the fiscal year ended September 30, 2023 for a full description of our existing stock-based compensation plans.

Restricted Stock Units

We issue restricted stock units (RSUs) to certain officers and key employees of the Company. The fair value of the RSUs is based on the price of our common stock as reported on the NASDAQ Global Market on the grant dates. Typically, these grants vest over a three-year period from the date of issuance and are a blend of time-based and performance-based shares. The portion of the grant that is time-based typically vests over a three-year period on each anniversary of the grant date, based on continued employment. The performance-based shares vest based on the three-year earnings and safety performance of the Company following the grant date. At December 31, 2023, there were 230,420 RSUs outstanding. The RSUs do not have voting rights but do receive dividend equivalents upon vesting which are accrued quarterly. Additionally, the shares of common stock underlying the RSUs are not considered issued and outstanding until vested and common stock is issued.

Total RSU activity (number of shares) for the three months ended December 31, 2023 is summarized below:


	Number of Restricted Stock Units	Weighted Average Grant Value Per Share
Outstanding at September 30, 2023	292,497	$	22.90
Granted	41,485	84.63
Vested	(103,562)	23.65
Forfeited/canceled	—	—
Outstanding at December 31, 2023	230,420	$	33.68

During the three months ended December 31, 2023 and 2022, we recorded compensation expense of $1.6 million and $1.3 million, respectively, related to the RSUs.

Restricted Stock

In December 2023, the Company's Compensation and Human Capital Committee revised the non-employee directors' annual restricted stock compensation from a fixed-shares arrangement to a fixed-value arrangement, retrospectively effective on October 1, 2023. Prior to October 1, 2023, each non-employee director received 2,400 restricted shares of the Company’s common stock annually. Fifty-percent of the restricted stock granted to each of our non-employee directors vested immediately, while the remaining fifty-percent vested on the anniversary of the grant date. Compensation expense was recognized immediately for the first fifty-percent of the restricted stock granted, while compensation expense for the remaining fifty-percent was recognized over the remaining vesting period. Subsequent to October 1, 2023, each non-employee director will receive restricted shares of the Company's common stock valued at $0.1 million annually. The number of granted shares is then calculated by dividing the $0.1 million by the average of high and low prices of our common stock on the grant date. The shares will vest on the earlier of the grant anniversary date or the date of the next annual meeting of shareholders, whichever occurs first. During the three months ended December 31, 2023 and 2022, we recorded compensation expense of less than $0.1 million for both periods, related to restricted stock.