Stockholders Equity and Stock Compensation
|9 Months Ended|
Sep. 30, 2022
|Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]|
|Stockholders Equity and Stock Compensation||
SHARE REPURCHASE PROGRAM
On January 31, 2022, the Company’s Board of Directors authorized a share repurchase program (the “Share Repurchase Program”), pursuant to which the Company may, from time to time, purchase shares of its Class A common stock, for an aggregate repurchase price not to exceed $500 million. The Share Repurchase Program expires on January 31, 2025 and does not obligate the Company to acquire any particular amount of shares. As of September 30, 2022, there was $425.8 million remaining to repurchase shares under the Share Repurchase Program.
The following table provides a summary the Company’s stock repurchase activities:
INCENTIVE AWARD PLAN
In the nine months ended September 30, 2022, the Company granted restricted stock with time-based vesting as well as performance-based awards. The performance-based awards include a market condition tied to the Company’s total shareholder return in relation to its peer companies as well as a financial performance condition tied to annual earnings per share (“EPS”) growth. The vesting and ultimate payout of performance awards is determined at the end of the performance period and can vary from zero to 200% based on actual results. As of September 30, 2022, there were 2,782,132 shares available for grant as equity awards under the 2017 Incentive Award Plan if target levels are achieved for performance-based awards and 2,082,132 if maximum levels are achieved.
The Company issued the following stock-based instruments:
A summary of the status and changes of the Company’s unvested shares is presented below:
The Company determines the fair value of restricted stock awards and any performance-related components based on the closing market price of the Company’s common stock on the date of grant. For share-based awards with a performance-based vesting requirement, the Company evaluates the probability of achieving the performance criteria throughout the performance period and will adjust stock compensation expense up or down based on its estimated probable outcome. Certain performance-based awards contain market condition components which are valued on the date of grant using a Monte Carlo simulation model.
For the three months ended September 30, 2022 and 2021, the Company recognized $9.7 million and $14.2 million of incentive stock compensation expense. For the nine months ended September 30, 2022 and 2021, the Company recognized $42.0 million and $39.7 million of incentive stock compensation expense. As of September 30, 2022, the unamortized stock compensation of $98.0 million is expected to be recognized over a weighted-average period of 2.01 years.
STOCK PURCHASE PLAN
A total of 5,000,000 shares of Class A Common Stock are available for sale under the 2018 Employee Stock Purchase Plan (“2018 ESPP”). The 2018 ESPP provides eligible employees of the Company and its subsidiaries the opportunity to purchase shares of the Company’s Class A Common Stock at a purchase price equal to 85% of the fair market value on the first trading day or last trading day of each purchase period, whichever is lower. Eligible employees can invest up to 15% of their compensation through payroll deductions during each purchase period. The purchase price discount and the look-back feature cause the 2018 ESPP to be compensatory and the Company recognizes compensation expense, which is computed using the Black-Scholes valuation model.
For the three months ended September 30, 2022 and 2021, the Company recognized $0.6 million and $0.5 million of ESPP stock compensation expense. For the nine months ended September 30, 2022 and 2021, the Company recognized $2.1 million and $1.7 million of ESPP stock compensation expense. As of September 30, 2022, there were 3,914,503 shares available for sale under the 2018 ESPP.
The entire disclosure for shareholders' equity and share-based payment arrangement. Includes, but is not limited to, disclosure of policy and terms of share-based payment arrangement, deferred compensation arrangement, and employee stock purchase plan (ESPP).
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef