Quarterly report pursuant to Section 13 or 15(d)

Stock-Based Compensation

v3.10.0.1
Stock-Based Compensation
 9 Months Ended
Sep. 30, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Stock-Based Compensation
Stock-Based Compensation
 
The Company has stock options and restricted stock units outstanding under the 2004 Stock Incentive Plan (the “2004 Plan”) and the 2010 Long-Term Incentive Plan (the “2010 Plan”).
 
As of September 30, 2018, the maximum number of common shares of the Company available for future issuance under the Company’s plans is 3,070,397.  
 
Stock-based compensation expense under the Company’s plans was as follows:
 
 
Three Months Ended
 
Nine Months Ended
 
 
September 30,
 
September 30,
 
 
2018
 
2017
 
2018
 
2017
Stock-based compensation expense
 
$
10,603

 
$
8,048

 
$
29,574

 
$
23,451

Tax effect on stock-based compensation expense
 
(2,682
)
 
(3,018
)
 
(7,482
)
 
(8,794
)
Net effect on income
 
$
7,921


$
5,030


$
22,092


$
14,657


 
The tax effect on stock-based compensation expense above was calculated using a blended statutory rate of 25.3% for the three and nine months ended September 30, 2018. The tax effect on stock-based compensation expense above was calculated using a blended statutory rate of 37.5% for the three and nine months ended September 30, 2017. However, due to the valuation allowance recorded on domestic deferreds, there was no tax effect related to stock-based compensation expense for the three and nine months ended September 30, 2018.
 
Stock Options
 
The following weighted average assumptions were used to value options granted during the periods indicated:
 
 
Three Months Ended
 
Nine Months Ended
 
 
September 30,
 
September 30,
 
 
2018
 
2017
 
2018
 
2017
Grant date fair value of options
 
$
—

 
$
—

 
$
—

 
$
14.51

Volatility
 
—
%
 
—
%
 
—
%
 
43.8
%
Risk-free interest rate
 
—
%
 
—
%
 
—
%
 
2.1
%
Dividend yield
 
—
%
 
—
%
 
—
%
 
—
%
Expected term (in years)
 
—

 
—

 
—

 
6.3


 
The following table summarizes option activity under the Company’s plans:
 
 
 
 
 
 
Weighted-Average
 
 
 
 
 
 
Weighted-
 
Remaining
 
 
 
 
 
 
Average
 
Contractual Life
 
Aggregate
 
 
Options
 
Exercise Price
 
(Years)
 
Intrinsic Value
Outstanding as of December 31, 2017
 
2,254,565

 
$
19.23

 
4.3
 
$
69,939

Exercised
 
(162,857
)
 
14.76

 
 
 
 
Forfeited
 
(1,668
)
 
32.46

 
 
 
 
Outstanding as of March 31, 2018
 
2,090,040

 
19.57

 
4.1
 
78,859

Exercised
 
(12,166
)
 
11.42

 
 
 
 
Outstanding as of June 30, 2018
 
2,077,874

 
19.62

 
3.9
 
73,421

Exercised
 
(174,445
)
 
15.25

 
 
 
 
Forfeited
 
(5,583
)
 
—

 
 
 
 
Outstanding as of September 30, 2018
 
1,897,846

 
20.00

 
3.6
 
77,726

Options exercisable
 
1,820,156

 
19.64

 
3.5
 
75,194


 
Exercise prices of stock options outstanding as of September 30, 2018 range from $7.15 to $55.29. At September 30, 2018, there was $887 of unrecognized stock-based compensation expense related to unvested stock options, which the Company expects to recognize over a weighted-average period of 1.2 years.
 
Restricted Stock Units and Restricted Stock Awards
 
Periodically, the Company grants restricted stock unit awards to employees. The following is a summary of the activity for unvested restricted stock units and awards granted under the Company’s plans:
 
 
    
 
Weighted-
 
 
 
 
Average Grant
 
 
Number of
 
Date Fair Value
 
 
Shares
 
per Share
Outstanding as of December 31, 2017
 
1,766,639

 
$
32.48

Granted
 
925,641

 
55.21

Vested
 
(503,668
)
 
34.05

Forfeited
 
(27,265
)
 
30.79

Outstanding as of March 31, 2018
 
2,161,347

 
41.59

Vested
 
(253,279
)
 
31.13

Forfeited
 
(27,324
)
 
39.78

Outstanding as of June 30, 2018
 
1,880,744

 
43.36

Granted
 
58,359

 
58.51

Vested
 
(159,783
)
 
31.23

Forfeited
 
(31,828
)
 
44.25

Outstanding as of September 30, 2018
 
1,747,492

 
44.98



At September 30, 2018, there was $65,884 of unrecognized stock-based compensation expense related to unvested restricted stock units and awards, which the Company expects to recognize over a weighted-average period of 2.0 years.
 
During March 2018 and July 2018, the Company granted 26,000 and 30,000 performance-based restricted stock unit awards to certain employees, respectively. These performance-based shares vest upon the achievement of certain business and financial metrics. The business and financial metrics governing the vesting of these stock unit awards provide thresholds which dictate the number of shares to vest upon each evaluation date, which range from 50% to 150%. If these metrics are achieved at 100%, as defined in the individual grant terms, these shares would cliff vest over three annual tranches equally.