Note 16 - Share-Based and Other Compensation Programs (Tables)
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12 Months Ended |
Dec. 31, 2018 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] |
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Schedule of outstanding awards and compensation expense recognized for each type of share-based award |
The following table summarizes awards outstanding and compensation expense recognized for each type of share-based award as of and for the years ended: | | | | | | | | | | | | | | | | | | | | | | | | | | | | December 31, | ($ in thousands) | | 2018 | | 2017 | | 2016 | Share-Based Compensation Programs | | Liability Recorded/ Equity Instruments Outstanding | | Compensation Cost Recognized (1) | | Liability Recorded/ Equity Instruments Outstanding | | Compensation Cost Recognized (1) | | Liability Recorded/ Equity Instruments Outstanding | | Compensation Cost Recognized (1) | Liabilities: RSUs—Cash-Settled | | $ | — |
| | $ | — |
| | $ | — |
| | $ | 1 |
| | $ | 18 |
| | $ | (718 | ) | Equity: | | | | | | | | | | | | | RSUs—Equity Settled | | 3,763,633 |
| | 16,591 |
| | 3,434,976 |
| | 12,206 |
| | 3,208,454 |
| | 13,285 |
| Non-Qualified Stock Options | | 1,312,791 |
| | 603 |
| | 1,692,743 |
| | 851 |
| | 2,839,738 |
| | 3,286 |
| Phantom Stock | | 234,427 |
| | 2 |
| | 234,302 |
| | 2 |
| | 234,174 |
| | 2 |
| Employee Stock Purchase Plan | | | | 453 |
| | | | 432 |
| | | | 449 |
| Equity | | | | 17,649 |
| | | | 13,491 |
| | | | 17,022 |
| Total all share-based plans | | | | $ | 17,649 |
| | | | $ | 13,492 |
| | | | $ | 16,304 |
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______________________ (1) For purposes of calculating compensation cost recognized, we generally consider awards effectively vested (and we recognize the full compensation costs) when grantees become retirement eligible.
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Schedule of additional information regarding all share-based awards |
The following table reflects additional information regarding all share-based awards for the years indicated: | | | | | | | | | | | | | | Year Ended December 31, | (In thousands) | 2018 | | 2017 | | 2016 | Total compensation cost recognized | $ | 17,649 |
| | $ | 13,492 |
| | $ | 16,304 |
| Less: Costs deferred as acquisition costs | 324 |
| | 269 |
| | 206 |
| Stock-based compensation expense | $ | 17,325 |
| | $ | 13,223 |
| | $ | 16,098 |
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Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity |
Information with regard to RSUs to be settled in stock for the periods indicated is as follows: | | | | | | | | | Number of Shares | | Weighted-Average Grant Date Fair Value | Unvested, December 31, 2017 (1) | 3,434,976 |
| | $ | 12.90 |
| Granted | 1,058,045 |
| | $ | 15.58 |
| Vested | (258,845 | ) | | $ | 12.61 |
| Forfeited | (470,543 | ) | | $ | 18.07 |
| Unvested, December 31, 2018 (1) | 3,763,633 |
| | $ | 13.04 |
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Schedule of valuation assumptions of performance based RSU |
he following assumptions: | | | | | | | | 2017 | | 2016 | Expected life | 3 years |
| | 3 years |
| Risk-free interest rate (1) | 1.6 | % | | 0.9 | % | Volatility of Radian’s stock (2) | 28.0 | % | | 29.7 | % | Average volatility of peer companies (3) | 30.6 | % | | 38.2 | % | Dividend yield | 0.06 | % | | 0.08 | % | Discount rate (4) | 10.7 | % | | 10.7 | % |
______________________ | | (1) | The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. |
| | (2) | Volatility of Radian’s stock is used in the calculation of the grant date fair value of the portion of the awards based on TSR Measures, as described above. Volatility is determined at the date of grant using the historical share price volatility and the expected life of each award. |
| | (3) | Average volatility of peer companies is used in the calculation of the grant date fair value of the portion of the awards based on the Relative TSR Measure, as described above. |
(4) A discount is applied to executive officer awards to reflect illiquidity during the one-year post-vesting holding period.
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Share-based Compensation Arrangement by Share-based Payment Award, Time-Vested Units, Grants in Period [Table Text Block] |
Information with regard to grants of time-vested RSUs to be settled in common stock is as follows for the periods indicated: | | | | | | | | | | | | Year Ended December 31, | | | 2018 | | 2017 (1) | | 2016 (2) | | Time-vested RSUs granted to certain executives and non-executive officers | 385,962 |
| (1) | 372,489 |
| | 180,380 |
| | Time-vested RSUs granted to non-employee directors | 76,763 |
| (3) | 68,337 |
| | 356,040 |
| (4) | Total time-vested RSUs granted (5) | 462,725 |
| | 440,826 |
| | 536,420 |
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______________________ | | (1) | The time-vested RSU awards granted in 2018 and 2017 are scheduled to vest in: (i) pro rata installments on each of the first three anniversaries of the grant date or (ii) generally at the end of three years. |
| | (2) | The time-vested RSU awards granted in 2016 generally are subject to three-year cliff vesting. |
| | (3) | The time-vested RSU awards granted in 2018 to non-employee directors generally are subject to one-year cliff vesting. |
| | (4) | Includes 262,694 time-vested awards granted on February 10, 2016 to convert the outstanding fully-vested 2009 and 2010 time-vested RSUs (to be settled in cash) awarded to our non-employee directors into time-vested RSUs to be settled in shares of our common stock on the conversion date (generally defined as a director’s termination of service with us). |
(5) The grant date fair value of time-vested RSUs was calculated based on the closing price of our common stock on the New York Stock Exchange on the date of grant, discounted for the lack of dividends earned over the vesting period, and is recognized as compensation expense over the service period.
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Schedule of information with regard to stock options |
Information with regard to stock options for the periods indicated is as follows: | | | | | | | | | | | | | | ($ in thousands, except per-share amounts) | Number of Shares | | Weighted Average Exercise Price Per Share | | Weighted Average Remaining Contractual Term | | Aggregate Intrinsic Value (1) | Outstanding, December 31, 2017 | 1,692,743 |
| | $ | 8.16 |
| | | | | Granted | — |
| | $ | — |
| | | | | Exercised | (375,573 | ) | | $ | 3.79 |
| | | | | Forfeited | (4,379 | ) | | $ | 14.38 |
| | | | | Expired | — |
| | $ | — |
| | | | | Outstanding, December 31, 2018 | 1,312,791 |
| | $ | 9.39 |
| | 4.9 | | $ | 9,500 |
| Exercisable, December 31, 2018 | 966,478 |
| | $ | 7.91 |
| | 4.0 | | $ | 8,361 |
| Available for grant, December 31, 2018 | 7,906,190 |
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______________________ (1) Based on the market price of $16.36 at December 31, 2018.
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Schedule of fully vested share options |
The following table summarizes additional information concerning stock option activity for the periods indicated: | | | | | | | | | | | | | | Years Ended December 31, | ($ in thousands, except per-share amounts) | 2018 | | 2017 | | 2016 | Granted (number of shares) | — |
| | — |
| | 342,090 |
| Weighted-average grant date fair value per share (1) | $ | — |
| | $ | — |
| | $ | 9.72 |
| Aggregate intrinsic value of options exercised | $ | 6,274 |
| | $ | 14,389 |
| | $ | 1,519 |
| Tax benefit of options exercised | $ | 1,318 |
| | $ | 5,036 |
| | $ | 532 |
| Cash received from options exercised | $ | 1,425 |
| | $ | 7,131 |
| | $ | 717 |
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______________________ | | (1) | We use the Monte Carlo valuation model in determining the grant date fair value of stock options issued to executives and non-executives using the assumptions noted in the following table: |
| | | | | Year Ended December 31, | | 2016 | Derived service period (years) | 3.02 - 4.00 |
| Risk-free interest rate (a) | 1.72 | % | Volatility (b) | 94.20 | % | Dividend yield | 0.08 | % |
______________________ | | (a) | The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. |
(b) Volatility is determined at the date of grant using historical share price volatility and expected life of each award.
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Schedule of valuation assumptions of stock options granted |
We use the Monte Carlo valuation model in determining the grant date fair value of stock options issued to executives and non-executives using the assumptions noted in the following table: | | | | | Year Ended December 31, | | 2016 | Derived service period (years) | 3.02 - 4.00 |
| Risk-free interest rate (a) | 1.72 | % | Volatility (b) | 94.20 | % | Dividend yield | 0.08 | % |
______________________ | | (a) | The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. |
(b) Volatility is determined at the date of grant using historical share price volatility and expected life of each award.
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Schedule of outstanding and exercisable options |
The following table summarizes information concerning outstanding and exercisable options at December 31, 2018: | | | | | | | | | | | | | | | | | | Options Outstanding | | Options Exercisable | Range of Exercise Prices | Number Outstanding | | Weighted Average Remaining Contractual Life (Years) | | Weighted Average Exercise Price | | Number Exercisable | | Weighted Average Exercise Price | $2.45 - $3.58 | 565,317 |
| | 3.4 | | $ | 2.45 |
| | 565,317 |
| | $ | 2.45 |
| $5.76 - $7.06 | — |
| | 0.0 | | $ | — |
| | — |
| | $ | — |
| $10.42 - $15.44 | 578,612 |
| | 6.0 | | $ | 13.53 |
| | 306,611 |
| | $ | 14.74 |
| $18.42 | 168,862 |
| | 6.3 | | $ | 18.42 |
| | 20,000 |
| | $ | 18.42 |
| | 1,312,791 |
| | 4.9 | | $ | 9.39 |
| | 891,928 |
| | $ | 7.03 |
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Schedule of valuation assumptions of ESPP |
The following assumptions were used in our calculation of Employee Stock Purchase Plan compensation expense during 2018: | | | | | | | | January 1, 2018 | | July 1, 2018 | Expected life | 6 months |
| | 6 months |
| Risk-free interest rate | 1.76 | % | | 2.43 | % | Volatility | 31.49 | % | | 32.80 | % | Dividend yield | 0.05 | % | | 0.06 | % |
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