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STOCKHOLDERS' EQUITY | 9 Months Ended
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Sep. 30, 2023
Equity [Abstract] |
STOCKHOLDERS' EQUITY | STOCKHOLDERS' EQUITY Public Offering of Class A Common Stock On June 16, 2023, we completed a public offering of 6,053 shares of our Class A common stock at a public offering price of $85.50 per share. After deducting stock issuance costs received as of September 30, 2023, including underwriting discounts, commissions and offering expenses, the offering has resulted in net proceeds of $496,231. The net proceeds from this offering were and are to be used to fund acquisition activity, including the GFL Acquisition and the Twin Bridges Acquisition, to pay certain costs associated with acquisition activities, as discussed in Note 11, Other Items and Charges, and to repay borrowings and/or debt securities as discussed Note 7, Debt. Stock Based Compensation Shares Available For Issuance In the fiscal year ended December 31, 2016, we adopted the 2016 Incentive Plan (“2016 Plan”). Under the 2016 Plan, we may grant awards up to an aggregate amount of shares equal to the sum of: (i) 2,250 shares of Class A common stock (subject to adjustment in the event of stock splits and other similar events), plus (ii) such additional number of shares of Class A common stock (up to 2,723 shares) as is equal to the sum of the number of shares of Class A common stock that remained available for grant under the 2006 Stock Incentive Plan (“2006 Plan”) immediately prior to the expiration of the 2006 Plan and the number of shares of Class A common stock subject to awards granted under the 2006 Plan that expire, terminate or are otherwise surrendered, canceled, forfeited or repurchased by us. As of September 30, 2023, there were 625 Class A common stock equivalents available for future grant under the 2016 Plan. On June 1, 2023, our stockholders approved the amendment and restatement of our Amended and Restated 1997 Employee Stock Purchase Plan (as further amended and restated, the “ESPP”) to increase the number of shares of Class A common stock reserved for issuance under the ESPP by 400 shares of Class A common stock. As of September 30, 2023, 444 shares of Class A common stock were available for issuance under the ESPP. Stock Options Stock options are granted at a price equal to the prevailing fair value of our Class A common stock at the date of grant. Generally, stock options granted have a term not to exceed ten years and vest over a one-year to five-year period from the date of grant. The fair value of each stock option granted is estimated using a Black-Scholes option-pricing model, which requires extensive use of accounting judgment and financial estimation, including estimates of the expected term stock option holders will retain their vested stock options before exercising them and the estimated volatility of our Class A common stock price over the expected term. A summary of stock option activity follows:
| Stock Options |  | Weighted Average Exercise Price |  | Weighted Average Remaining Contractual Term (years) |  | Aggregate Intrinsic Value
Outstanding, December 31, 2022 | 129 |  |  | $ | 55.60 |  |  |  |  |
Granted | — |  |  | $ | — |  |  |  |  |
Exercised | (18) |  |  | $ | 4.88 |  |  |  |  |
Forfeited | — |  |  | $ | — |  |  |  |  |
Outstanding, September 30, 2023 | 111 |  |  | $ | 63.87 |  |  | 7.3 |  | $ | 1,846 |
Exercisable, September 30, 2023 | 49 |  |  | $ | 40.60 |  |  | 5.4 |  | $ | 1,825 |
Stock-based compensation expense related to stock options was $126 and $374 during the three and nine months ended September 30, 2023, respectively, as compared to $89 and $122 during the three and nine months ended September 30, 2022, respectively. As of September 30, 2023, we had $1,724 of unrecognized stock-based compensation expense related to outstanding stock options to be recognized over a weighted average period of 3.7 years. During the three and nine months ended September 30, 2023, the aggregate intrinsic value of stock options exercised was $1,302 and $1,302, respectively. Other Stock Awards Restricted stock awards, restricted stock units and performance stock units, with the exception of market-based performance stock units, are granted at a price equal to the fair value of our Class A common stock at the date of grant. The fair value of each market-based performance stock unit is estimated using a Monte Carlo pricing model, which requires extensive use of accounting judgment and financial estimation, including the estimated share price appreciation plus, if applicable, the value of dividends of our Class A common stock as compared to the Russell 2000 Index over the requisite service period. Generally, restricted stock awards granted to non-employee directors vest incrementally over a three-year to five-year period beginning on the first anniversary of the date of grant. Restricted stock units granted to non-employee directors vest in full on the first anniversary of the grant date. Restricted stock units granted to employees vest incrementally over an identified service period, typically three to five years, beginning on the grant date based on continued employment. Performance stock units granted to employees, including market-based performance stock units, vest at a future date following the grant date and are based on the attainment of performance targets and market achievements, as applicable. A summary of restricted stock award, restricted stock unit and performance stock unit activity follows:
| Restricted Stock Awards, Restricted Stock Units, and Performance Stock Units (1) |  | Weighted Average Grant Date Fair Value |  | Weighted Average Remaining Contractual Term (years) |  | Aggregate Intrinsic Value
Outstanding, December 31, 2022 | 169 |  |  | $ | 75.52 |  |  |  |  |
Granted | 119 |  |  | $ | 81.04 |  |  |  |  |
Class A Common Stock Vested | (65) |  |  | $ | 62.57 |  |  |  |  |
Forfeited | (6) |  |  | $ | 76.91 |  |  |  |  |
Outstanding, September 30, 2023 | 217 |  |  | $ | 91.51 |  |  | 2.1 |  | $ | 16,597 |
Unvested, September 30, 2023 | 376 |  |  | $ | 88.63 |  |  | 1.7 |  | $ | 28,660 |
(1)Performance stock unit grants, including market-based performance stock units, are included at the 100% attainment level. Attainment of the maximum performance targets and market achievements would result in the issuance of an additional 159 shares of Class A common stock currently included in unvested. Stock-based compensation expense related to restricted stock awards, restricted stock units and performance stock units was $2,112 and $6,007 during the three and nine months ended September 30, 2023, respectively, as compared to $2,225 and $5,204 during the three and nine months ended September 30, 2022, respectively. During the three and nine months ended September 30, 2023, the total fair value of other stock awards vested was $223 and $5,279, respectively. As of September 30, 2023, total unrecognized stock-based compensation expense related to outstanding restricted stock awards was $12, which will be recognized over a weighted average period of 0.7 years. As of September 30, 2023, total unrecognized stock-based compensation expense related to outstanding restricted stock units was $6,344, which will be recognized over a weighted average period of 2.4 years. As of September 30, 2023, total expected unrecognized stock-based compensation expense related to outstanding performance stock units was $5,655 to be recognized over a weighted average period of 1.7 years. The weighted average fair value of market-based performance stock units granted during the nine months ended September 30, 2023 was $83.16 per award, which was calculated using a Monte Carlo pricing model assuming a risk-free interest rate of 4.31% and an expected volatility of 34.9% assuming no expected dividend yield. Risk-free interest rate is based on the U.S. Treasury yield curve for the expected service period of the award. Expected volatility is calculated using the daily volatility of our Class A common stock over the expected service period of the award. The Monte Carlo pricing model requires extensive use of accounting judgment and financial estimation. Application of alternative assumptions could produce significantly different estimates of the fair value of stock-based compensation and consequently, the related amounts recognized in the consolidated statements of operations. We also recorded $120 and $318 of stock-based compensation expense related to the ESPP during the three and nine months ended September 30, 2023, respectively, as compared to $97 and $262 during the three and nine months ended September 30, 2022, respectively. Accumulated Other Comprehensive Income, Net of Tax A summary of the changes in the balances of each component of accumulated other comprehensive income, net of tax follows:
|  |  | Interest Rate Swaps
Balance, December 31, 2022 |  |  | $ | 7,542 |
Other comprehensive income before reclassifications |  |  | 6,846 |
Income reclassified from accumulated other comprehensive income into interest expense |  |  | (4,181) |
Income tax provision related to items of other comprehensive income |  |  | (727) |
Net current-period other comprehensive income, net of tax |  |  | 1,938 |
Balance, September 30, 2023 |  |  | $ | 9,480 |
A summary of reclassifications out of accumulated other comprehensive income, net of tax into earnings follows:
|  | Three Months Ended September 30, |  | Nine Months Ended September 30, |  |
|  | 2023 |  | 2022 |  | 2023 |  | 2022 |  |
Details About Accumulated Other Comprehensive Income, Net of Tax Components |  | Amounts Reclassified Out of Accumulated Other Comprehensive Income, Net of Tax |  | Affected Line Item in the Consolidated Statements of Operations
Interest rate swaps |  | $ | (1,805) |  |  | $ | 14 |  |  | $ | (4,181) |  |  | $ | 2,136 |  |  | Interest expense
|  | 1,805 |  |  | (14) |  |  | 4,181 |  |  | (2,136) |  |  | Income before income taxes
|  | 495 |  |  | — |  |  | 1,146 |  |  | (190) |  |  | Provision for income taxes
|  | $ | 1,310 |  |  | $ | (14) |  |  | $ | 3,035 |  |  | $ | (1,946) |  |  | Net income

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- Definition The entire disclosure for shareholders' equity and share-based payment arrangement. Includes, but is not limited to, disclosure of policy and terms of share-based payment arrangement, deferred compensation arrangement, and employee stock purchase plan (ESPP). + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 505 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//505/tableOfContent Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 718 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//718/tableOfContent + Details
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