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Share-Based Compensation | 12 Months Ended
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Dec. 31, 2019
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] |
Share-Based Compensation | Note 8. Share-Based Compensation Stock Incentive Plan On May 19, 2016, our shareholders approved the Old Dominion Freight Line, Inc. 2016 Stock Incentive Plan (the “Stock Incentive Plan”) previously approved by our Board of Directors. The Stock Incentive Plan, under which awards may be granted until May 18, 2026 or the Stock Incentive Plan’s earlier termination, serves as our primary equity incentive plan and provides for the grant of incentive stock options, nonqualified stock options, stock appreciation rights, restricted awards, performance awards, phantom stock awards and other stock-based awards or dividend equivalent awards to selected employees and non-employee directors. The maximum number of shares of common stock that we may issue or deliver pursuant to awards granted under the Stock Incentive Plan is 2,000,000 shares. Restricted Stock Awards During 2019, 2018 and 2017, we granted restricted stock awards to selected employees and non-employee directors under the Stock Incentive Plan. The employee restricted stock awards vest in three equal annual installments on each anniversary of the grant date, and the non-employee director restricted stock awards vest in full on the first anniversary of the grant date. In both cases, the restricted stock awards are subject to accelerated vesting due to death, total disability, or change in control of the Company. Subject to the foregoing, unvested restricted stock awards are generally forfeited upon termination of employment. The restricted stock awards accrue dividends while the award is unvested and only carry rights to receive the accrued dividends once vested. Compensation cost for restricted stock awards is measured at the grant date based on the fair market value per share of our common stock. The following table summarizes our restricted stock award activity for employees and non-employee directors:
|  | Shares |  | Weighted Average Grant Date Fair Value Per Share
Unvested at January 1, 2019 |  |  | 91,181 |  |  | $ | 107.06 |
Granted |  |  | 75,048 |  |  |  | 144.89 |
Vested |  |  | (51,675 | ) |  |  | 98.11 |
Forfeited |  |  | (5,400 | ) |  |  | 133.91 |
Unvested at December 31, 2019 |  |  | 109,154 |  |  | $ | 135.97 |
The weighted average grant date fair value per restricted stock award granted during fiscal years 2019, 2018 and 2017 was $144.89, $137.78 and $90.16, respectively. The total fair value of vested restricted stock awards for fiscal year 2019, 2018 and 2017 was $7.3 million, $6.2 million and $2.7 million, respectively. At December 31, 2019, the Company had $8.2 million of unrecognized stock-based compensation cost, net of estimated forfeitures, related to unvested restricted stock awards that are expected to be recognized over a weighted average period of 1.8 years. Performance-Based Restricted Stock Units During 2019, we granted performance-based restricted stock units (“PBRSUs”) to selected employees under the Stock Incentive Plan. The PBRSUs are earned based on the achievement of stated Company performance metrics over a one-year performance period. One-third of the earned PBRSUs vest following the end of the one-year performance period if the performance metrics are satisfied, with an additional one-third of the PBRSUs vesting on each of the next two anniversaries. Earned PBRSUs are subject to accelerated vesting due to death, total disability, or change in control of the Company. Subject to the foregoing, unvested PBRSUs are generally forfeited if minimum threshold performance targets are not achieved or upon termination of employment. The PBRSUs do not include dividend participation rights. Compensation cost for PBRSUs is measured at the grant date based on the fair market value per share of our common stock, with consideration given to the probability of achieving performance targets. At the end of each reporting period, we reassess the probability of achieving performance targets and changes to our initial assessment are reflected in the reporting period in which the change in estimate occurs. At December 31, 2019, all PBRSUs previously granted were forfeited as the performance metrics were not met. Phantom Stock Plan Employee Plans On October 30, 2012, our Board of Directors approved, and we adopted the Old Dominion Freight Line, Inc. 2012 Phantom Stock Plan, as amended on January 29, 2015 and December 16, 2019 (the “2012 Phantom Stock Plan”). Under the 2012 Phantom Stock Plan, 1,000,000 shares of phantom stock may be awarded, each of which represents a contractual right to receive an amount in cash or common stock equal to the fair market value of a share of our common stock on the settlement date, which is the earliest of the date of the participant’s (i) termination of employment for any reason other than for cause, (ii) death or (iii) total disability. Each award vests in 20% increments on the anniversary of the grant date provided that the participant (i) has been continuously employed by us since the grant date, (ii) has been continuously employed by us for ten years, and (iii) has reached the age of 65 (with respect to the cash settlement option). Vesting also occurs on the earliest of (i) a change in control, (ii) death or (iii) total disability. Awards are settled in cash or common stock after the required vesting period has been satisfied and upon termination of employment. Unvested shares are forfeited upon termination of employment, although our Board of Directors has authority to modify and/or accelerate the vesting of awards. On May 16, 2005, our Board of Directors approved, and the Company adopted, the Old Dominion Freight Line, Inc. Phantom Stock Plan, as amended January 1, 2009, May 18, 2009, May 17, 2011, January 29, 2015 and December 16, 2019 (the “2005 Phantom Stock Plan” and, together with the 2012 Phantom Stock Plan, the “Employee Phantom Plans”). The 2005 Phantom Stock Plan expired in May 2012; however, grants under the 2005 Phantom Stock Plan remain outstanding. Each share of phantom stock awarded to eligible employees under the 2005 Phantom Stock Plan represents a contractual right to receive an amount in cash or common stock equal to the fair market value of a share of our common stock on the settlement date, which generally is the earlier of the eligible employee’s (i) termination from the Company after reaching 55 years of age (with respect to the cash settlement option), (ii) death, or (iii) total disability. Awards are settled in cash after the required vesting period has been satisfied and upon termination of employment. Awards under the 2005 Phantom Stock Plan vest upon the earlier to occur of the following: (i) the date of a change of control in our ownership; (ii) the fifth anniversary of the grant date of the award, provided the participant is employed by us on that date; (iii) the date of the participant’s death while employed by us; (iv) the date of the participant’s total disability; or (v) with respect to the cash settlement option, the date the participant attains the age of 65 while employed by us. Awards that are not vested upon termination of employment are forfeited. The 2005 Phantom Stock Plan does, however, provide the Board of Directors with discretionary authority to modify and/or accelerate the vesting of awards. On December 16, 2019, our Board of Directors approved, and the Company adopted, amendments to the Employee Phantom Plans. The amendments permit settlement of outstanding phantom stock awards in shares of the Company’s common stock in lieu of cash settlement, among other administrative changes. For employees who elected to amend their phantom stock awards under the Employee Phantom Plans and settle awards in common stock, the amended award agreements also provide for waivers of the age 65 and age 55 vesting provisions required by the 2012 Phantom Stock Plan and the 2005 Phantom Stock Plan, respectively. Director Plan On May 28, 2008, our Board of Directors approved, and the Company adopted, the Old Dominion Freight Line, Inc. Director Phantom Stock Plan, as amended April 1, 2011, February 20, 2014, August 7, 2014, February 25, 2016 and December 16, 2019 (the “Director Phantom Stock Plan” and together with the Employee Phantom Plans, the “Phantom Plans”). Under the Director Phantom Stock Plan, each eligible non-employee director was granted an annual award of phantom shares. Our Board of Directors approved the initial grant under this plan at its May 2008 meeting and authorized the subsequent annual grants to be made thereafter. For each vested phantom share, participants are entitled to an amount in cash or common stock equal to the fair market value of the award on the date that service as a director terminates for any reason. Our shareholders approved the Stock Incentive Plan at our 2016 Annual Meeting of Shareholders; as a result, no phantom shares have been granted under the Phantom Plans since such approval. Director Phantom Stock Plan awards vest upon the earlier to occur of the following: (i) the one-year anniversary of the grant date; (ii) the date of the first annual meeting of shareholders that occurs after the grant date provided the participant is still in service as a director; (iii) the date of a change of control in our ownership provided that the participant is still in service as a director; or (iv) the date of the participant’s death or total disability while still in service as a director. Awards that are not vested upon termination of service as a director are forfeited. On December 16, 2019, our Board of Directors approved, and the Company adopted, an amendment to the Director Phantom Stock Plan. The amendment permit s settlement of outstanding phantom stock awards in shares of the Company’s common stock in lieu of cash settlement, among other administrative changes. Accounting Impact Modified awards are accounted for as equity awards rather than liability awards under ASC Topic 718, Compensation - Stock Compensation, as they are settled in common stock rather than cash. In December 2019, awards for 409,331 employee and director phantom shares were modified to settle in shares of the Company’s common stock. These modified awards have a weighted average grant date fair value per share of $180.61. In connection with the modification, the $55.0 million and $10.0 million accrued liability for unsettled phantom stock awards was reclassified to “Capital in excess of par value” on our Balance Sheet. Incremental compensation cost of $9.5 million resulting from the modification of awards was recognized in “Salaries, wages and benefits” on our Statements of Operations on the modification date. A summary of the changes in the number of outstanding phantom stock awards during the year ended December 31, 2019 for the Phantom Plans is provided below:
|  | Employee Phantom Plans |  | Director Phantom Stock Plan |  | Total
Balance of shares outstanding at December 31, 2018 |  |  | 466,387 |  |  |  | 54,071 |  |  |  | 520,458 |
Granted |  |  | — |  |  |  | — |  |  |  | — |
Settled |  |  | (41,217 | ) |  |  | — |  |  |  | (41,217 | )
Forfeited |  |  | — |  |  |  | — |  |  |  | — |
Balance of shares outstanding at December 31, 2019 |  |  | 425,170 |  |  |  | 54,071 |  |  |  | 479,241 |
Of the outstanding awards at December 31, 2019, 409,331 phantom shares relate to modified awards and 69,910 phantom shares relate to unmodified awards. Of these outstanding awards, 451,480 and 356,789 phantom shares were vested at December 31, 2019 and 2018, respectively. Of the modified shares, 282,619 phantom shares were vested pre-modification and 112,386 phantom shares were vested post-modification for a total of 395,005 vested phantom shares with a weighted average grant date fair value per share of $180.84. As such, 14,326 phantom shares with a weighted average grant date fair value per share of $174.44 were unvested at December 31, 2019. The liability for unsettled phantom stock awards accounted for as a liability under the Phantom Plans was $12.3 million and $57.2 million as of December 31, 2019 and 2018, respectively. A summary of cash payments for settled unmodified liability phantom shares is provided below:
|  | Year Ended December 31,
(In thousands) |  | 2019 |  | 2018 |  | 2017
Employee Phantom Plans |  | $ | 2,988 |  |  | $ | 2,360 |  |  | $ | 3,066 |
Director Phantom Stock Plan |  |  | 964 |  |  |  | 198 |  |  |  | 474 |
Unrecognized compensation cost for all unvested shares related to unmodified awards under the Employee Phantom Plans as of December 31, 2019 was $0.9 million based on the fair market value of the awards on that date. While the Stock Incentive Plan currently serves as our primary equity plan, the terms of the Phantom Stock Plans and related award agreements will continue to govern all awards granted under the Phantom Stock Plans until such awards have been settled, forfeited, canceled or have otherwise expired or terminated.

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