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STOCK-BASED COMPENSATION AND EQUITY | 12 Months Ended
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Dec. 31, 2024
Share-Based Payment Arrangement [Abstract] |
STOCK-BASED COMPENSATION AND EQUITY | STOCK-BASED COMPENSATION AND EQUITY The Company's stock-based compensation awards are in the form of restricted stock and performance share awards granted pursuant to the Company's Amended and Restated 2019 Incentive Plan (the "Plan"). Stock-based compensation cost is measured at the grant date based on the fair value of the award, and is recognized as an expense over the employee’s or non-employee director’s requisite service period. As of December 31, 2024, there was a total o f 463,169 sh ar es of common stock reserved under the Plan for issuance under future share-based payment arrangements, assuming maximum payout of performance share awards outstanding as of December 31, 2024. The following table details total stock-based compensation expense for the years ended December 31, 2024, 2023 and 2022, included in the consolidated statements of operations:
(In thousands) | 2024 |  | 2023 |  | 2022
Costs of sales | $ | 721 |  |  | $ | 745 |  |  | $ | 809 |
Operating expenses | 4,799 |  |  | 2,526 |  |  | 4,364 |
Pre-tax stock-based compensation expense | 5,520 |  |  | 3,271 |  |  | 5,173 |
Less: income tax effect | (1,159) |  |  | (687) |  |  | (1,086) |
Net (after tax) stock-based compensation expense | $ | 4,361 |  |  | $ | 2,584 |  |  | $ | 4,087 |
As of December 31, 2024, there was $6.8 million of unrecognized compensation cost related to unvested or unearned, as applicable, stock-based compensation arrangements granted under the Plan, which is expected to be recognized over a weighted-average period of 1.8 years. Restricted Stock The Company grants restricted stock to executive officers, certain key employees and non-employee directors under the Plan with the fair value of the awards representing the fair value of the common stock on the date the restricted stock is granted. Shares of restricted stock generally vest in equal annual installments over the applicable vesting period, which ranges from one to three years. The Company records expenses for these grants on a straight-line basis over the applicable vesting periods. A summary of restricted stock activity (including shares of restricted stock issued pursuant to the settlement of performance share awards) under the Plan during the years ended December 31, 2024, 2023 and 2022 is as follows:
| Shares |  | Weighted-Average Grant-Date Fair Value
Unvested stock outstanding at January 1, 2022 | 314,883 |  |  | $ | 29.79 |
Granted | 161,375 |  |  | 34.22 |
Vested | (181,405) |  |  | 29.79 |
Forfeited | (13,692) |  |  | 31.66 |
Unvested stock outstanding at December 31, 2022 | 281,161 |  |  | $ | 32.24 |
Granted | 210,351 |  |  | 26.44 |
Vested | (145,529) |  |  | 31.35 |
Forfeited | (2,668) |  |  | 29.23 |
Unvested stock outstanding at December 31, 2023 | 343,315 |  |  | $ | 29.08 |
Granted | 502,866 |  |  | 10.07 |
Vested | (175,040) |  |  | 29.18 |
Forfeited | (101,804) |  |  | 21.21 |
Unvested stock outstanding at December 31, 2024 | 569,337 |  |  | $ | 14.34 |
Performance Share Awards The Company grants performance share awards to executive officers and certain key employees under the Plan, with the number of shares of common stock earned and issuable under each award determined at the end of a three-year performance period, based on the Company's achievement of performance goals predetermined by the Compensation Committee of the Board of Directors at the time of grant. These performance share awards include a modifier to the total number of shares earned based on the Company's total shareholder return ("TSR") compared to a small-cap stock market index. If certain levels of the performance objective are met, the award results in the issuance of shares of common stock corresponding to such level. Performance share awards that result in the issuance of shares of common stock are not subject to time-based vesting at the conclusion of the three-year performance period. In the event that the Company's financial performance meets the predetermined targets for the performance objectives of the performance share awards, the Company will issue each award recipient the number of shares of common stock equal to the target award specified in the individual's underlying performance share award agreement. In the event the financial results of the Company exceed the predetermined targets, additional shares up to the maximum award may be issued. In the event the financial results of the Company fall below the predetermined targets, a reduced number of shares may be issued. If the financial results of the Company fall below the threshold performance levels, no shares will be issued. The total number of shares issued for the performance share award may be increased, decreased, or unchanged based on the TSR modifier described above. The recipients of performance share awards do not receive dividends or possess voting rights during the performance period and, accordingly, the fair value of the performance share awards is the quoted market value of TruBridge's common stock on the grant date less the present value of the expected dividends not received during the relevant period. The TSR modifier applicable to the performance share awards is considered a market condition and therefore is reflected in the grant date fair value of the award. A Monte Carlo simulation has been used to account for this market condition in the grant date fair value of the award. Expense related to performance share awards is recognized using ratable straight-line amortization over the three-year performance period. In the event the Company determines it is no longer probable that the minimum performance level will be achieved, all previously recognized compensation expense related to the applicable awards is reversed in the period such a determination is made. A summary of performance share award activity under the Plan for the years ended December 31, 2024, 2023 and 2022, is as follows, based on the target award amounts set forth in the performance share award agreements:
| Shares |  | Weighted-Average Grant-Date Fair Value
Performance share awards outstanding at January 1, 2022 | 249,952 |  |  | $ | 29.59 |
Granted | 101,799 |  |  | 37.98 |
Forfeited or unearned | (72,059) |  |  | 32.74 |
Vested and issued | (27,317) |  |  | 31.75 |
Performance share awards outstanding at December 31, 2022 | 252,375 |  |  | $ | 31.84 |
Granted | 122,071 |  |  | 31.21 |
Forfeited or unearned | (100,655) |  |  | 27.46 |
Performance share awards outstanding at December 31, 2023 | 273,791 |  |  | $ | 33.17 |
Granted | 323,461 |  |  | 10.60 |
Forfeited or unearned | (145,471) |  |  | 20.31 |
Performance share awards outstanding at December 31, 2024 | 451,781 |  |  | $ | 19.02 |
Stock Repurchases On September 4, 2020, our Board of Directors approved a stock repurchase program under which we may repurchase up to $30.0 million of our common stock through September 3, 2022. On July 27, 2022, the Board of Directors extended the expiration date of the stock repurchase program to September 4, 2024. The share repurchase program expired according to its terms on September 4, 2024. The Company did not purchase any shares during 2024. Any future stock repurchase transactions may be made through open market purchases, privately-negotiated transactions, or otherwise in compliance with Rule 10b-18 under the Securities Exchange Act of 1934, as amended. Any repurchase activity will depend on many factors, such as the availability of shares of our common stock, general market conditions, the trading price of our common stock, alternative uses for capital, the Company's financial performance, compliance with the terms of our Amended and Restated Credit Agreement and other factors. Concurrent with the authorization of this stock repurchase program in September 2020, the Board of Directors opted to indefinitely suspend all quarterly dividends. Common Stock Rights Agreement On March 26, 2024, the Board of Directors declared a dividend of one right (a “Right”) for each of the Company’s issued and outstanding shares of common stock. The dividend was paid to the stockholders of record at the close of business on April 4, 2024. The complete description and terms of the Rights were set forth in the Rights Agreement, dated as of March 26, 2024, by and between the Company and Computershare Trust Company, N.A. as rights agent, as amended by the Amendment to the Rights Agreement dated as of April 22, 2024 (as amended, the “Rights Agreement”). On February 11, 2025, the Company and Computershare Trust Company, N.A. entered into the Second Amendment to the Rights Agreement. The amendment terminated the Rights Agreement by accelerating the expiration time of the Rights Agreement to expire on February 12, 2025. At the time of the termination of the Rights Agreement, all of the Rights, which were previously distributed to holders of the Company’s issued and outstanding common stock, par value $0.001, pursuant to the Rights Agreement, expired. Each Right initially entitled the registered holder, subject to the terms of the Rights Agreement, to purchase from the Company one half of a share of common stock, at an exercise price of $28.00 for each one half of a share of common stock (equivalent to $56.00 for each whole share of common stock), subject to certain adjustments. The Rights would only become exercisable upon the occurrence of certain events as described in the Rights Agreement. The Company analyzed the terms governing the Rights under ASC 480, Distinguishing Liabilities from Equity, and concluded that the Rights were a freestanding financial instrument that qualified for liability classification. Specifically, the provisions within the Rights Agreement provided for scenarios outside of the Company’s control that could require the Company to settle a portion of the Rights in cash, rather than in shares of common stock. The Rights were only exercisable upon the occurrence of certain events, which had not occurred as of the end of the reporting period. As it was not considered likely that these events would occur, the Company considered the likelihood of exercise to be remote and had not ascribed value to the Rights as of December 31, 2024.

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