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Share-based Compensation
 12 Months Ended
Dec. 31, 2021
Share-based Payment Arrangement [Abstract]  
Share-based Compensation SHARE-BASED COMPENSATION
Stock Options:
The Company has issued non-qualified and incentive stock options to employees and nonemployee directors. The fair value of these options are estimated on the date of grant using the Black-Scholes option pricing model, which requires estimates of the expected term of the option, the risk-free interest rate, the expected volatility of the price of the Company’s common stock, and dividend yield. Options outstanding as of December 31, 2021 generally vest over a period of three years and expire ten years from the date of grant. The exercise price of these options ranges from $26.52 to $66.68. Due to the Company’s lack of option exercise history on the date of grant, the expected term is calculated using the simplified method defined as the midpoint between the vesting period and the contractual term of each option. The risk free interest rate is based on the U.S. Treasury yield curve in effect on the date of grant that most closely corresponds to the expected term of the option. The expected volatility is based on the historical volatility of the Company’s common stock over the period of time equivalent to the expected
term for each award. The dividend yield is computed as the annualized dividend rate at the grant date divided by the strike price of the stock option. For the years ended December 31, 2021 and 2020, the Company did not grant stock options.
The number of stock options and weighted-average exercise prices as of December 31, 2021 and 2020 are as follows:
20212020
AwardsWeighted-Average Exercise PriceAwardsWeighted-Average Exercise Price
(awards in thousands)
Outstanding at beginning of period61 $48.19 97 $52.53 
Exercised(29)40.53 (28)57.79 
Forfeited— — (8)68.45 
Outstanding at end of the period32 $54.98 61 $48.19 
Exercisable at end of the period23 $49.50 44 $39.98 
As of December 31, 2021, the weighted-average remaining contractual life was 5.3 years with an aggregate intrinsic value of $5.1 million for outstanding stock options and the weighted-average remaining contractual life was 4.9 years with an aggregate intrinsic value of $3.6 million for exercisable options. The unrecognized compensation expense calculated under the fair value method for shares expected to vest as of December 31, 2021 was $0.1 million and is expected to be recognized over a weighted average period of 1.1 years. The Company received $0.8 million, $1.6 million and $0.3 million in cash proceeds from the exercise of stock options during the years ended December 31, 2021, 2020 and 2019, respectively. The total intrinsic value of options exercised during the years ended December 31, 2021, 2020 and 2019 was $5.9 million, $1.5 million and $1.0 million, respectively.
Restricted Stock:
The Company has issued restricted stock to employees and nonemployee directors generally with vesting terms up to five years after the date of grant. The fair value of the restricted stock is equal to the market price of the Company’s common stock on the date of grant. Expense for restricted stock is amortized ratably over the vesting period. A summary of outstanding restricted stock activity as of December 31, 2021 and 2020 are as follows:
20212020
SharesWeighted-Average Grant Date Fair ValueSharesWeighted-Average Grant Date Fair Value
(shares in thousands)
Outstanding at beginning of period50 $116.06 46 $98.28 
Granted22 264.58 43 113.87 
Vested(26)116.68 (32)88.71 
Forfeited(3)169.47 (7)108.86 
Outstanding at end of the period43 $183.51 50 $116.06 
The Company withheld approximately 22,000, 6,000 and 128,000 shares of the Company’s common stock to cover minimum tax liability withholding obligations upon the vesting of shares of restricted stock for the years ended December 31, 2021, 2020 and 2019, respectively. The total fair value of restricted stock awards vested during the years ended December 31, 2021, 2020 and 2019 was $7.0 million, $3.7 million and $4.7 million, respectively.
Performance-based Share Awards:
The Company has issued performance-based share awards to certain key executives who were granted a target number of deferred shares and may earn between 0% and 200% of the target number depending upon achieved performance against pre-determined performance goals over a three-year performance period after the date of grant. The fair value of the performance-based share awards is equal to the market price of the Company’s common stock on the date of grant adjusted by expected level
of achievement over the performance period. Expense for performance-based share awards is amortized ratably over the performance period.
Share-based compensation expense is recorded in selling, general, and administrative expense in the accompanying Consolidated Statements of Income. The total expenses during the years ended December 31, 2021, 2020 and 2019 are as follows (in thousands):
202120202019
SharesShare-Based Compensation ExpenseSharesShare-Based Compensation ExpenseSharesShare-Based Compensation Expense
Options and restricted stock75 $4,302 111 $3,493 143 $3,817 
Performance-based share awards granted in 202115 1,986 — — — — 
Performance-based share awards granted in 202026 1,807 28 1,662 — — 
Performance-based share awards granted in 2019— 1,808 17 1,641 18 703 
Total share-based compensation116 $9,903 156 $6,796 161 $4,520 
The total income tax benefit recognized in the accompanying Consolidated Statements of Income for restricted stock awards was $2.4 million, $1.4 million and $7.5 million for the years ended December 31, 2021, 2020 and 2019, respectively.
There was $4.8 million of total unrecognized compensation cost related to restricted stock awards as of December 31, 2021, which is expected to be recognized over a weighted-average period of 1.7 years. There was $7.3 million of unrecognized compensation cost related to the 40,610 performance-based shares discussed above as of December 31, 2021, which is expected to be recognized over 1.8 years