Stock-Based Compensation

3 Months Ended

Mar. 31, 2021

Share-based Payment Arrangement [Abstract]

Stock-based compensation awards granted by our Board of Directors for the three months ended March 31, 2021 and 2020 were as follows:


	For the Three Months Ended March 31,
	2021	2020
Award type:
Stock options	477,500	298,000
Deferred share units	11,811	12,552
Restricted stock units	514,460	309,389

In the three months ended March 31, 2021 and 2020, we recognized $0.8 million and $0.4 million, respectively, in stock-based compensation expense. A majority of the expense, $0.7 million and $0.3 million respectively, was recorded as selling and administrative expense in the Consolidated Statement of Operations, with the remaining expenses incurred as cost of sales.

As of March 31, 2021, unrecognized compensation cost related to non-vested stock options, deferred share units and restricted stock units was $16.2 million, which will be recognized over the remaining weighted average life of 4.1 years. Certain of our awards include provisions that accelerate vesting in the event of a Change in Control. For the purpose of these grants, a “Change in Control” shall occur upon (i) Brookfield and any affiliates thereof (collectively, the “Majority Stockholder”) ceasing to own stock of the Company that constitutes at least thirty percent (30%) or thirty-five percent (35%), as applicable, of the total fair market value or total voting power of the stock of the Company or (ii) any one person, or more than one person acting as a group (as defined under Treasury Regulation § 1.409A-3(i)(5)(v)(B)) other than the Company, the Majority Stockholder or any employee benefit plan sponsored by the Company acquires ownership of stock of the Company that, together with stock held by such person or group, constitutes one hundred percent (100%) of the total fair market value or total Voting Power of the stock of GrafTech. As of March 31, 2021, unrecognized compensation subject to this acceleration was $15.2 million and will result in an accelerated non-cash charge if and when a Change in Control actually occurs. Of this expense, approximately $1.0 million will accelerate at the 35% ownership level and the remaining $14.2 million at the 30% ownership level.

Stock option, deferred share unit and restricted stock unit award activity under the Company's Omnibus Equity Incentive Plan for the three months ended March 31, 2021 was as follows:

Stock Options


	Number of Shares	Weighted- Average Exercise Price
Outstanding unvested as of December 31, 2020	906,361	$	13.01
Granted	477,500	11.49
Vested	(81,200)	10.39
Forfeited	—	—
Outstanding unvested as of March 31, 2021	1,302,661	$	12.62

Deferred Share Unit and Restricted Stock Unit awards


	Number of Shares	Weighted- Average Grant Date Fair Value
Outstanding unvested as of December 31, 2020	524,488	$	10.41
Granted	526,271	11.50
Vested	(99,847)	10.69
Forfeited	—	—
Outstanding unvested as of March 31, 2021	950,912	$	10.98