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Note 7 - Stock-based Compensation

3 Months Ended

Mar. 31, 2020

Share-based Payment Arrangement [Text Block]

7. Stock-based Compensation

We recognize compensation expense for stock-based payment awards made to our employees, consultants and directors. Our current stock-based compensation plans include our 2017 Equity and Incentive Compensation Plan (the “2017 EICP”); our 2007 Long-Term Incentive Plan, as amended (the “2007 Incentive Plan”); and our Directors’ Restricted Stock Plan. The following table provides our stock-based compensation expense and related income tax benefit for the three-months ended March 31, 2020 and 2019, respectively (in millions).

	Three Months Ended March 31,
	2020			2019
Stock-based compensation expense, gross	$	4		$	2
Income tax benefit at our statutory rate associated with stock-based compensation		(1	)		(1	)
Stock-based compensation expense, net	$	3		$	1

All shares of common stock and Class A common stock underlying outstanding options, restricted stock units and performance awards are counted as issued at target levels under the 2017 EICP, the 2007 Incentive Plan and the Directors’ Restricted Stock Plan for purposes of determining the number of shares available for future issuance.

During the three-months ended March 31, 2020, we granted under the 2017 EICP:

●

83,407 shares of restricted Class A common stock with a grant date fair value per share of $19.87 to an employee, of which 27,802 shares will vest on each of January 31, 2021 and 2022 and 27,803 shares will vest on January 31, 2023;

●

83,407 shares of restricted Class A common stock with a grant date fair value per share of $19.87 to an employee, subject to the achievement of certain performance measures, which will vest on January 31, 2023;

●

207,787 shares of restricted common stock with a grant date fair value per share of $21.69 to certain employees, of which 69,262 shares will vest on each of January 31, 2021 and 2022 and 69,263 shares will vest on January 31, 2023;

●

40,756 shares of restricted common stock with a grant date fair value per share of $21.69 to an employee, subject to the achievement of certain performance measures, which will vest on January 31, 2023;

●

restricted stock units representing 90,184 shares of our common stock, to certain employees, of which 60,052 shares will vest on March 1, 2021; and 15,066 shares will vest on each of March 1, 2022 and 2023.

During the three-months ended March 31, 2019, we granted under the 2017 EICP:

●

99,905 shares of restricted Class A common stock with a grant date fair value per share of $15.36 to an employee, of which 33,302 shares vested on January 31, 2020; 33,302 shares will vest on January 31, 2021 and 33,301 shares will vest on January 31, 2022;

●

99,905 shares of restricted Class A common stock with a grant date fair value per share of $15.36 to an employee, subject to the achievement of certain performance measures, which will vest on January 31, 2022;

●

340,993 shares of restricted common stock with a grant date fair value per share of $14.85 to certain employees that will vest on January 2, 2021;

●

277,048 shares of restricted common stock with a grant date fair value of $16.55 to certain employees, of which 92,349 shares vested on January 31, 2020; 92,349 shares will vest on January 31, 2021 and 92,350 shares will vest on January 31, 2022;

●

48,338 shares of restricted common stock with a grant date fair value per share of $16.55 to an employee, subject to the achievement of certain performance measures, which will vest on January 31, 2022; and

●

11,223 shares of restricted common stock with a grant date fair value per share of $17.83 to an employee that vested on February 15, 2020.

A summary of restricted common stock and Class A common stock activities for the three-months ended March 31, 2020 and 2019, respectively, is as follows:

	Three Months Ended March 31,
	2020					2019
				Weighted-					Weighted-
				Average					Average
	*Number*			*Grant Date*		*Number*			*Grant Date*
	of			*Fair Value*		of			*Fair Value*
	*Shares*			*Per Share*		*Shares*			*Per Share*
Restricted common stock:
Outstanding - beginning of period		977,547		$	15.45		578,894		$	13.14
Granted (1)		248,543			21.69		677,602			15.72
Forfeited		(85,630	)		15.53		-			-
Vested		(260,004	)		14.20		(279,170	)		13.25
Outstanding - end of period		880,456		$	17.57		977,326		$	14.89

Restricted Class A common stock:
Outstanding - beginning of period		449,284		$	13.55		407,786		$	11.82
Granted (1)		166,814			19.87		199,810			15.36
Vested		(136,056	)		12.32		(158,312	)		11.38
Outstanding - end of period		480,042		$	16.10		449,284		$	13.55

Restricted stock units - common stock:
Outstanding - beginning of period		398,000		$	18.21		-		$	-
Granted		90,184			18.92		-			-
Vested		-			-		-			-
Outstanding - end of period		488,184		$	18.34		-		$	-

(1) For awards subject to future performance conditions, amounts assume target performance.

At December 31, 2019, we had 274,746 options to acquire our common stock outstanding at an exercise price of $1.99 per share, all of which were vested and exercisable. During the first quarter of 2020, all of the outstanding options were exercised. The aggregate intrinsic value of the exercised options was approximately $3 million. As of March 31, 2020, we did not have any options outstanding for our common stock or Class A common stock.