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Share-Based Compensation
3 Months Ended
Mar. 31, 2019
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]  
Share-Based Compensation

8.

Share-Based Compensation

 

We currently have five types of share-based awards outstanding to our employees and directors: stock options, restricted stock awards, restricted stock units, performance stock units, and market stock units. We believe that our share-based awards align the interests of our employees and directors with those of our stockholders. Each of these award types generally vests over three or four years.

 

During the three months ended March 31, 2019, we granted the following awards to employees of Nutrisystem in replacement of their unvested equity awards as of Closing (“Replacement Awards”): (i) approximately 258,000 time-vesting restricted stock awards at a fair value of $19.42 per share and (ii) approximately 919,000 time-vesting restricted stock units at a fair value of $19.42 per share.  Approximately $9.1 million of the fair value of the Replacement Awards was attributable to pre-combination service and was included in the purchase price of Nutrisystem (see Note 2).  Post-combination expense related to the Replacement Awards of approximately $13.7 million is expected to be recognized over the remaining post-combination requisite service period.

 

We recognize share-based compensation expense for the market stock units if the requisite service period is rendered, even if the market condition is never satisfied. For the three months ended March 31, 2019, we recognized total share-based compensation costs of $2.4 million, including $0.1 million recorded to restructuring and related charges.  For the three months ended March 31, 2018, we recognized total share-based compensation costs of $1.4 million.  We account for forfeitures as they occur.  

 

A summary of our stock options as of March 31, 2019 and the changes during the three months then ended is presented below:

 

Options

 

Shares

(In thousands)

 

 

Weighted

Average

Exercise

Price

Per Share

 

 

Weighted

Average

Remaining

Contractual

Term

 

 

Aggregate

Intrinsic Value

(In thousands)

 

Outstanding at January 1, 2019

 

 

431

 

 

$

17.83

 

 

 

 

 

 

 

 

 

Granted

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exercised

 

 

(35

)

 

 

10.70

 

 

 

 

 

 

 

 

 

Forfeited

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expired

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Outstanding at March 31, 2019

 

 

396

 

 

$

18.46

 

 

 

4.4

 

 

$

1,262

 

Exercisable at March 31, 2019

 

 

316

 

 

$

13.57

 

 

 

3.3

 

 

$

1,262

 

 

The following table shows a summary of our restricted stock awards as of March 31, 2019, as well as activity during the three months then ended:

 

 

 

Restricted Stock Awards

 

 

 

Shares

(In thousands)

 

 

Weighted-

Average

Grant Date

Fair Value

 

Nonvested at January 1, 2019

 

 

 

 

$

 

Granted

 

 

 

 

 

 

Replacement Awards

 

 

258

 

 

 

19.42

 

Vested

 

 

 

 

 

 

Forfeited

 

 

 

 

 

 

Nonvested at March 31, 2019

 

 

258

 

 

$

19.42

 

 

The following table shows a summary of our restricted stock units as of March 31, 2019, as well as activity during the three months then ended:

 

 

 

Restricted Stock Units

 

 

 

Shares

(In thousands)

 

 

Weighted-

Average

Grant Date

Fair Value

 

Nonvested at January 1, 2019

 

 

271

 

 

$

24.07

 

Granted

 

 

141

 

 

 

19.42

 

Replacement Awards

 

 

919

 

 

 

19.42

 

Vested

 

 

(68

)

 

 

11.42

 

Forfeited

 

 

 

 

 

 

Nonvested at March 31, 2019

 

 

1,263

 

 

$

20.84

 

 

The following table shows a summary of our performance stock units as of March 31, 2019, as well as activity during the three months then ended:

 

 

 

Performance Stock Units

 

 

 

Shares

(In thousands)

 

 

Weighted-

Average

Grant Date

Fair Value

 

Nonvested at January 1, 2019

 

 

 

 

$

 

Granted

 

 

103

 

 

 

19.42

 

Vested

 

 

 

 

 

 

 

Forfeited

 

 

 

 

 

 

 

Nonvested at March 31, 2019

 

 

103

 

 

$

19.42

 

 

The following table shows a summary of our market stock units as of March 31, 2019, as well as activity during the three months then ended:

 

 

 

Market Stock Units

 

 

 

Shares

(In thousands)

 

 

Weighted-

Average

Grant Date

Fair Value

 

Nonvested at January 1, 2019

 

 

45

 

 

$

18.25

 

Granted

 

 

 

 

 

 

Vested

 

 

 

 

 

 

Forfeited

 

 

 

 

 

 

Nonvested at March 31, 2019

 

 

45

 

 

$

18.25