Stockholders' Equity

6 Months Ended

Jun. 30, 2019

Stockholders’ Equity

The Company’s authorized capital stock consists of 400,000,000 shares of common stock, $0.01 par value per share, and 100,000,000 shares of preferred stock, $0.01 par value per share. The Company has an at-the-market equity offering program (the “$300 Million ATM Program”) pursuant to which the Company may issue and sell shares of its common stock having an aggregate offering price of up to $300.0 million ($235.9 million remaining as of June 30, 2019) in amounts and at times to be determined by the Company from time to time. Prior to the implementation of the $300 Million ATM Program, the Company had a $250.0 million ATM program (the “$250 Million ATM Program”), which was substantially utilized as of June 30, 2019 and which is no longer active, and a $200.0 million ATM program (the “$200 Million ATM Program”), which was substantially utilized as of June 30, 2018 and which is no longer active. Actual sales under the $300 Million ATM Program, if any, will depend on a variety of factors to be determined by the Company from time to time, including, among others, market conditions, the trading price of the Company’s common stock, determinations by the Company of the appropriate sources of funding for the Company and potential uses of funding available to the Company. During the three and six months ended June 30, 2019, the Company issued an aggregate of 2,375,270 and 4,364,071 shares, respectively, of common stock at a weighted average offering price of $45.76 and $43.77 per share, respectively, under the $300 Million ATM Program and the $250 Million ATM Program, resulting in net proceeds of approximately $107.1 million and $188.2 million, respectively, and paying total compensation to the applicable sales agents of approximately $1.6 million and $2.8 million, respectively. During the three and six months ended June 30, 2018, the Company issued an aggregate of 2,826,167 and 2,885,401 shares, respectively, of common stock at a weighted average offering price of $37.48 and $37.43 per share, respectively, under the $250 Million ATM Program and the $200 Million ATM Program, resulting in net proceeds of approximately $104.4 million and $106.4 million, respectively, and paying total compensation to the applicable sales agents of approximately $1.5 million and $1.6 million, respectively.

The Company has a share repurchase program authorizing the Company to repurchase up to 3,000,000 shares of its outstanding common stock from time to time through December 31, 2020. Purchases made pursuant to the program will be made in either the open market or in privately negotiated transactions as permitted by federal securities laws and other legal requirements. The timing, manner, price and amount of any repurchases will be determined by the Company in its discretion and will be subject to economic and market conditions, stock price, applicable legal requirements and other factors. The program may be suspended or discontinued at any time. As of June 30, 2019, the Company had not repurchased any shares of stock pursuant to its share repurchase authorization.

In connection with the Annual Meeting of Stockholders on April 30, 2019, the Company granted a total of 11,200 shares of unrestricted stock to its independent directors under the 2019 Plan with a grant date fair value per share of $44.65. The grant date fair value of the unrestricted common stock was determined using the closing price of the Company’s common stock on the date of the grant. The Company recognized approximately $0.5 million in compensation costs for both the three and six months ended June 30, 2019 related to this issuance.

On April 30, 2019, the Company’s stockholders approved the 2019 Plan, which replaces the Amended and Restated 2010 Equity Incentive Plan (the “2010 Plan”). The 2019 Plan permits the grant of restricted stock awards, performance share awards and unrestricted stock awards. The maximum number of shares of the Company’s common stock that may be issued under the 2019 Plan is 1,898,961, which consists of (i) 1,510,079 shares initially reserved and available for issuance under the 2019 Plan and (ii) 388,882 shares underlying outstanding awards under the 2010 Plan, which if forfeited, canceled or otherwise terminated under the 2010 Plan shall be added to the shares available for issuance under the 2019 Plan. No further awards will be made under the 2010 Plan.

As of June 30, 2019, there were 1,898,961 shares of common stock authorized for issuance as restricted stock grants, unrestricted stock awards or Performance Share awards under the 2019 Plan, of which 1,517,560 were remaining available for issuance. The grant date fair value per share of restricted stock awards issued during the period from February 16, 2010 (commencement of operations) to June 30, 2019 ranged from $14.20 to $40.29. The fair value of the restricted stock that was granted during the six months ended June 30, 2019 was approximately $1.2 million and the vesting period for the restricted stock is five years. As of June 30, 2019, the Company had approximately $3.9 million of total unrecognized compensation costs related to restricted stock issuances, which is expected to be recognized over a remaining weighted average period of approximately 2.9 years. The Company recognized compensation costs of approximately $0.4 million for both the three months ended June 30, 2019 and 2018 and approximately $0.9 million for both the six months ended June 30, 2019 and 2018 related to the restricted stock issuances.

The following is a summary of the total restricted shares granted to the Company’s executive officers and employees with the related weighted average grant date fair value share prices for the six months ended June 30, 2019:

Restricted Stock Activity:



	Shares		Weighted Average Grant Date Fair Value
Non-vested shares outstanding as of December 31, 2018	383,930		$	22.98
Granted	30,294		40.29
Forfeited	(28,656	)	30.26
Vested	(15,367	)	23.90
Non-vested shares outstanding as of June 30, 2019	370,201		$	23.79

The following is a vesting schedule of the total non-vested shares of restricted stock outstanding as of June 30, 2019:



Non-vested Shares Vesting Schedule		Number of Shares
2019 (6 months)		—
2020		303,857
2021		14,600
2022		11,937
2023		35,343
Thereafter		4,464
Total non-vested shares		370,201

Long-Term Incentive Plan:

As of June 30, 2019, there are three open performance measurement periods for the Performance Share awards: January 1, 2017 to December 31, 2019, January 1, 2018 to December 31, 2020, and January 1, 2019 to December 31, 2021. During the six months ended June 30, 2019, the Company issued 196,087 shares of common stock at a price of $36.55 per share related to the Performance Share awards for the performance period from January 1, 2016 to December 31, 2018. The expense related to the open Performance Share awards granted prior to January 1, 2019 varies quarter to quarter based on the Company’s relative share price performance.

The following table summarizes certain information with respect to the Performance Share awards granted prior to January 1, 2019 (dollars in thousands):



Performance Share Period	Fair Value June 30, 2019		Accrual June 30, 2019		Expense for the Three Months Ended June 30,				Expense for the Six Months Ended June 30,
Performance Share Period	Fair Value June 30, 2019		Accrual June 30, 2019		2019		2018		2019		2018
January 1, 2018 - December 31, 2020	$	6,065	$	3,021	$	1,295	$	279	1,886		523
January 1, 2017 - December 31, 2019	7,161		5,958		1,097		509		1,884		1,109
January 1, 2016 - December 31, 2018	—		—		—		579		—		1,393
Total	$	13,226	$	8,979	$	2,392	$	1,367	$	3,770	$	3,025

On January 8, 2019, the Company amended and restated its Amended and Restated Long-Term Incentive Plan. Under the Amended LTIP, each participant’s Performance Share target award for target awards granted on or after January 1, 2019 will be expressed as a number of shares of common stock and settled in shares of common stock. Target awards were previously expressed as a dollar amount and settled in shares of common stock. Commencing with Performance Share awards granted on or after January 1, 2019, the grant date fair value of the Performance Share awards will be determined under current accounting treatment using a Monte Carlo simulation model on the date of grant and recognized on a straight-line basis over the performance period.

The following table summarizes certain information with respect to the Performance Share awards granted on or after January 1, 2019 (dollars in thousands):



Performance Share Period	Fair Value on Date of Grant		Expense for the Three Months Ended June 30,				Expense for the Six Months Ended June 30,
Performance Share Period	Fair Value on Date of Grant		2019		2018		2019		2018
January 1, 2019 - December 31, 2021	$	4,829	$	403	$	—	$	805	$	—

Dividends:

The following table sets forth the cash dividends paid or payable per share during the six months ended June 30, 2019:

For the Three Months Ended

Security

Dividend per

Declaration Date

Record Date

Date Paid

March 31, 2019

Common stock

0.24

February 5, 2019

March 29, 2019

April 12, 2019

June 30, 2019

Common stock

0.24

April 30, 2019

July 5, 2019

July 19, 2019