Note 13. Common Stock and Stock-based Compensation

12 Months Ended

Dec. 31, 2020

Share-based Payment Arrangement [Abstract]

Share-based Payment Arrangement [Text Block]

Stockholders' Equity

Completed Share Repurchase Authorization

In March 2019, our Board of Directors authorized a share repurchase program effective March 7, 2019 through December 31, 2020. The share repurchase program authorized the Company to repurchase up to $350.0 million of its common stock, not to exceed 13.7 million shares. On April 24, 2020, as a result of then-current market conditions, the Board of Directors amended the repurchase program to remove the share limitation. Share repurchase activity under this program was as follows:

	Shares Repurchased			Remaining Authorization to Repurchase
Period	Number of shares	Cost (in millions)		Cost (in millions)
March 7, 2019 Authorization				$	350.0
March 7, 2019 through March 31, 2019	866,715	$	19.0	$	331.0
April 1, 2019 through June 30, 2019	2,133,116	44.0		$	287.0
July 1, 2019 through September 30, 2019	5,171,489	100.9		$	186.1
October 1, 2019 through December 31, 2019	2,933,474	60.8		$	125.3
January 1, 2020 through March 31, 2020	1,850,000	35.4		$	89.9
April 1, 2020 through June 30, 2020	—	—		$	89.9
July 1, 2020 through September 30, 2020	4,466,896	89.9		$	—
Total	17,421,690	$	350.0

In the third quarter of 2020, we completed the existing share repurchase program. In addition to the amounts reported in the table above, share repurchases for the year ended December 31, 2019 included 2.6 million shares at a cost of approximately $70.0 million representing the final settlement of an accelerated share repurchase program, which was funded in November 2018 but a portion of which remained outstanding as of December 31, 2018.

Active Share Repurchase Authorization

In October 2020, our Board of Directors authorized a new share repurchase program effective October 23, 2020 through December 31, 2021. The new share repurchase program authorized the Company to repurchase up to $250.0 million of its common stock. Share repurchase activity under this program is as follows:

	Shares Repurchased			Remaining Authorization to Repurchase
Period	Number of shares	Cost (in millions)		Cost (in millions)
October 23, 2020 Authorization				$	250.0
October 23, 2020 through December 31, 2020	2,974,922	$	67.8	$	182.2
Total	2,974,922	$	67.8

Certain shares of stock repurchased during December 2020, totaling $1.8 million, were cash settled in January 2021 in accordance with normal settlement practices. During the years ended December 31, 2020, 2019, and 2018, share repurchases totaled 9.3 million, 13.7 million, and 17.2 million shares, respectively, at a cost of approximately $193.1 million, $294.7 million, and $430.1 million, respectively.

Shareholders' Equity and Share-based Payments [Text Block]

Stock-Based Compensation

Stock Award Plans

Our 2004 Fourth Amended and Restated Stock Option and Incentive Plan (the "Plan”) provides for awarding 20,150,000 (adjusted for stock splits) shares of common stock plus (i) shares covered by forfeited, expired, and canceled options granted under prior plans; and (ii) shares tendered as full or partial payment for the purchase price of an award or to satisfy tax withholding obligations. At December 31, 2020, a total of 1,973,045 shares were available for issuance. The Plan provides for the granting of nonqualified and incentive stock options having maximum ten-year terms to purchase common stock at its market value on the award date; stock appreciation rights based on common stock fair market values with settlement in common stock or cash; restricted stock awards; restricted stock units; and performance awards with settlement in common stock or cash on achievement of specific business objectives. Our stock options have contractual terms of ten years and become exercisable in various percentages over periods ranging up to five years.

Stock-Based Compensation Expense

The cost of employee services received in exchange for awards of equity instruments is referred to as share-based compensation and is based on the grant date fair-value of those awards. Stock-based compensation includes compensation expense, recognized over the applicable vesting periods, for share-based awards. Stock-based compensation expense totaled $26.9 million, $29.2 million, and $29.3 million for the years ended December 31, 2020, 2019, and 2018, respectively.

The income tax benefit related to stock-based compensation expense was $0.4 million, $6.6 million, and $7.7 million for the years ended December 31, 2020, 2019, and 2018, respectively.

Stock Options

Expense related to stock options is recognized on a straight-line basis over the vesting period. There were no options outstanding at December 31, 2019. No options were exercisable at December 31, 2020.

	Number of Shares	Weighted Average Grant-Date Fair Value per Award		Weighted Average Remaining Contractual Terms (Years)	Aggregate Intrinsic Value (in millions)
Options outstanding at December 31, 2019	—	$	—
Granted	300,000	$	5.26
Exercised	—	$	—
Cancelled	—	$	—
Options outstanding at December 31, 2020	300,000	$	5.26	9.1	$	1.4

At December 31, 2020, unrecognized compensation expense related to stock options totaled $1.1 million, which will be recognized over a weighted average period of 2.1 years. The weighted average exercise price of stock options outstanding as of December 31, 2020 was $21.61.

The fair value of the stock options granted was estimated at the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions:

	Year Ended December 31, 2020
Exercise price	$	21.61
Risk-free interest rate	1.48		%
Expected life (in years)	6.50
Equity volatility	35.00		%
Dividend yield	3.42		%

Restricted Stock

Restricted share awards consist of restricted stock and restricted stock units ("RSUs"). Expense related RSUs issued to eligible employees under the Plan is recognized ratably over the vesting period, generally between three years and four years. Certain restricted stock and RSUs vest in their entirety upon the employee's retirement from the Company, taking into consideration the employee's age and years of service to the Company, as defined more specifically in our benefit plans. Certain RSU grants made in 2020 provide for full vesting when the award recipients reach 60 years of age and have provided at least 10 years of service to the Company, provided that the awards remain outstanding for a period of six months from the date of grant. The expense for these awards is recognized over the applicable service period for each of the eligible award recipients. Expense related to restricted stock awards ("RSAs") and RSUs granted to non-employee directors under the Plan is recognized ratably over the vesting period, generally one year. Forfeitures are recognized as a reduction to expense in the period in which they occur.

	Number of Restricted Share Awards	Weighted Average Grant-Date Fair Value per Award
Restricted share awards outstanding at December 31, 2019	5,055,461	$	20.99
Granted	1,022,115	$	18.62
Vested	(1,802,836)	$	21.70
Forfeited	(476,309)	$	20.59
Restricted share awards outstanding at December 31, 2020 (1)	3,798,431	$	20.06

(1) The balance of restricted share awards outstanding at December 31, 2020 includes approximately 0.7 million restricted shares for Arcosa employees that were converted under the shareholder method at the time of the Arcosa spin-off. These restricted shares will be released to Arcosa employees upon vesting, but as of the spin-off date, Trinity no longer records the compensation expense associated with these shares.

At December 31, 2020, unrecognized compensation expense related to restricted share awards totaled $29.8 million, which will be recognized over a weighted average period of 3.1 years. The total grant-date fair value of shares vested and released during the years ended December 31, 2020, 2019, and 2018 was $39.1 million, $26.4 million, and $30.1 million, respectively. The weighted average grant-date fair value of restricted share awards granted during the years ended December 31, 2020, 2019, and 2018 was $18.62, $22.20, and $25.52 per share, respectively.

Performance Units

Performance units are granted to employees based upon a target level; however, depending upon the achievement of certain specified goals during the performance period, performance units may be adjusted to a level ranging between 0% and 200% of the target level. The performance units vest upon certification by the Human Resources Committee of the Board of Directors of the achievement of the specified performance goals. Expense related to performance units is recognized ratably from their award date to the end of the performance period, generally three years. Forfeitures are recognized as a reduction to expense in the period in which they occur.

	Number of Performance Units	Weighted Average Grant-Date Fair Value per Award
Performance units outstanding at December 31, 2019	800,762	$	26.33
Granted	444,252	$	20.31
Vested	(3,091)	$	28.35
Forfeited	(6,751)	$	24.74
Performance units outstanding at December 31, 2020	1,235,172	$	24.17

At December 31, 2020, unrecognized compensation expense related to performance units totaled $6.1 million, which will be recognized over a weighted average period of 1.5 years. The total grant-date fair value of performance units vested and released during the year ended December 31, 2020 was $0.1 million. There were no performance units vested during the years ended December 31, 2019, and 2018. The weighted average grant-date fair value of performance units granted during the years ended December 31, 2020, 2019, and 2018 was $20.31, $22.22, and $32.37 per share, respectively.