Long-Term Incentive Plan

12 Months Ended

Dec. 31, 2020

Long-Term Incentive Plan

Long-Term Incentive Plan

12. Long-Term Incentive Plan

The Company’s Long-Term Incentive Plan (“LTIP”) provides for the granting to directors, officers and eligible employees awards that may be made in the form of incentive or nonqualified stock options, restricted shares or units, performance shares or units, share appreciation rights, or any combination thereof. The Company has reserved 12,050,000 common shares for issuance under the LTIP, and 2,911,865 shares remain available for future issuance as of December 31, 2020. At December 31, 2020, there were no stock options, restricted units, performance shares or units, or share appreciation rights issued or outstanding under the LTIP.

Stock Grants

Restricted shares granted pursuant to the Company’s LTIP generally vest over a period of three years from the date of grant. Should a stock grant be forfeited prior to its vesting, the shares covered by the stock grant are added back to the LTIP and remain available for future issuance. Shares of common stock tendered or withheld to satisfy the grant or exercise price or tax withholding obligations upon the vesting of a stock grant are not added back to the LTIP.

Compensation expense related to awards of restricted shares are measured at fair value on the date of grant and amortized over the relevant requisite service period or derived service period. The Company has elected to account for forfeitures as they occur.

The Company’s amortization expense and forfeitures related to restricted shares for the years ended December 31, 2020, 2019 and 2018 were as follows (in thousands):

	2020		2019		2018
Amortization expense, including forfeitures	$	9,576	$	9,313	$	9,007

In addition, the Company capitalizes compensation costs related to restricted shares granted to certain employees whose work is directly related to the Company’s capital investment in its hotels. During 2020, 2019 and 2018, these capitalized costs totaled $0.4 million.

The following is a summary of non-vested restricted stock grant activity:

	2020			2019			2018
		Weighted			Weighted			Weighted
		Average			Average			Average
	Shares	Price		Shares	Price		Shares	Price
Outstanding at beginning of year	1,217,850	$	14.88	1,177,760	$	14.89	1,175,049	$	14.12
Granted	852,601	$	12.91	701,754	$	14.35	617,595	$	15.84
Vested	(691,111)	$	14.20	(657,732)	$	14.32	(602,091)	$	14.37
Forfeited	(42,504)	$	14.05	(3,932)	$	15.48	(12,793)	$	14.39
Outstanding at end of year	1,336,836	$	14.01	1,217,850	$	14.88	1,177,760	$	14.89

As of December 31, 2020, $10.4 million in compensation expense related to non-vested restricted stock grants remained to be recognized over a weighted-average period of 21 months.