XML 37 R21.htm IDEA: XBRL DOCUMENT
v3.20.4

Stockholders' Equity and Stock-Based Compensation | 12 Months Ended
--- | ---
Jan. 02, 2021
Stockholders' Equity and Stock-Based Compensation [Abstract] |
STOCKHOLDERS' EQUITY AND STOCK-BASED COMPENSATION | STOCKHOLDERS' EQUITY AND STOCK-BASED COMPENSATION On August 3, 2020, the Company’s Board of Directors approved the extension for an additional two years of its previously announced share repurchase program and refreshed the amount of the program back up to its original amount of an aggregate of $200.0 million of the Company's Common Stock depending on market conditions. During fiscal 2020 and fiscal 2019, the Company repurchased approximately $55.0 million and $19.3 million including commissions of its common stock in the open market, respectively. As of January 2, 2021, the Company has approximately $200.0 million remaining under the share repurchase program initially approved in August 2017 and subsequently extended to August 13, 2022. On May 9, 2017, the shareholders approved the Company's 2017 Omnibus Incentive Plan (the “2017 Omnibus Plan”). The 2017 Omnibus Plan replaced the Company's 2012 Omnibus Incentive Plan (the “2012 Omnibus Plan”) for future grants. Under the 2017 Omnibus Plan, the Company can grant stock options, stock appreciation rights, non-vested and restricted stock (including performance stock), restricted stock units (including performance units), other stock-based awards, non-employee director awards, dividend equivalents and cash-based awards. There are up to 20,166,500 common shares available under the 2017 Omnibus Plan which may be granted to participants in any plan year (as such term is defined in the 2017 Omnibus Plan). Some of those shares are subject to outstanding awards as detailed in the tables below. To the extent these outstanding awards are forfeited or expire without exercise, the shares will be returned to and available for future grants under the 2017 Omnibus Plan. The 2017 Omnibus Plan’s purpose is to attract, retain and motivate employees, directors and third party service providers of the Company and to encourage them to have a financial interest in the Company. The 2017 Omnibus Plan is administered by the Compensation Committee (the “Committee”) of the Board of Directors. The Committee has the authority to select plan participants, grant awards, and determine the terms and conditions of such awards as provided in the 2017 Omnibus Plan. For each of fiscal 2020, 2019 and 2018, the Committee adopted an executive compensation program that includes a long-term incentive component (the “LTIP”) for the Company's key employees, as a subplan under the terms of the 2017 Omnibus Plan. Pursuant to the LTIP, for each of fiscal 2020, 2019, and 2018, participants received (i) annual, overlapping grants of performance share units (“PSUs”) tied to a three-year, forward looking performance metric and (ii) annual stock options grants that vest 33.33% on the first, second and third anniversaries of grant. The principal purpose of the LTIP is to encourage the participants to enhance the value of the Company and, hence, the price of the Company’s stock and the stockholders' return. In addition, the LTIP is designed to create retention incentives for the individual and to provide an opportunity for increased equity ownership by participants. See “Stock Option Awards”, “Fiscal 2020 LTIP PSU Awards”, “Fiscal 2019 LTIP PSU Awards” and “Fiscal 2018 LTIP PSU Awards” below for more information regarding the stock options and PSU awards under the 2020 LTIP, 2019 LTIP and 2018 LTIP. At January 2, 2021, the number of common shares available for issuance under the 2017 Omnibus Plan was 10,824,222. At January 2, 2021, $7.4 million of total future equity-based compensation expense (determined using the Black-Scholes option pricing model and Monte Carlo model for non-vested stock grants with performance based incentives) related to outstanding non-vested options and stock awards is expected to be recognized over a weighted average period of 1.2 years. The following is a summary of stock-based compensation awards granted during the years ended January 2, 2021, December 28, 2019 and December 29, 2018. Stock Option Awards. Stock options to purchase Darling common shares were granted by the Committee to certain of the Company's employees as part of the Company's LTIPs in effect for each of fiscal 2020, 2019 and 2018 under the 2017 Omnibus Plan. For the options granted under the fiscal 2020 LTIP, 2019 LTIP and 2018 LTIP, the exercise price was equal to the closing price of Darling common shares on the date of grant, which was January 6, 2020, January 25, 2019 and January 29, 2018, respectively, and such options vest 33.33% on the first, second and third anniversaries of the grant date. The Company granted 550,941 stock options under the 2020 LTIP, 610,953 stock options under the 2019 LTIP and 637,115 stock options under the 2018 LTIP. During fiscal 2020, 2019 and 2018 only nonqualified stock options were issued and none of the options were incentive stock options. The Company’s stock options granted under the LTIPs generally terminate 10 years after the date of grant. A summary of all stock option activity as of January 2, 2021 and changes during the year ended is as follows:
| Number of shares |  | Weighted-avg. exercise price per share |  | Weighted-avg. remaining contractual life
Options outstanding at December 30, 2017 | 3,290,757 |  |  | $ | 11.86 |  |  | 7.3 years
Granted | 637,115 |  |  | 18.82 |  |  |
Exercised | (153,717) |  |  | 11.49 |  |  |
Forfeited | (19,953) |  |  | 9.99 |  |  |
Expired | — |  |  | — |  |  |
Options outstanding at December 29, 2018 | 3,754,202 |  |  | 13.07 |  |  | 6.9 years
Granted | 610,953 |  |  | 21.00 |  |  |
Exercised | (380,206) |  |  | 9.83 |  |  |
Forfeited | (6,464) |  |  | 18.11 |  |  |
Expired | — |  |  | — |  |  |
Options outstanding at December 28, 2019 | 3,978,485 |  |  | 14.59 |  |  | 6.5 years
Granted | 550,941 |  |  | 28.89 |  |  |
Exercised | (837,911) |  |  | 12.01 |  |  |
Forfeited | — |  |  | — |  |  |
Expired | — |  |  | — |  |  |
Options outstanding at January 2, 2021 | 3,691,515 |  |  | $ | 17.31 |  |  | 6.2 years
Options exercisable at January 2, 2021 | 2,527,003 |  |  | $ | 14.07 |  |  | 5.3 years
The fair value of each stock option grant under the LTIPs was estimated on the date of grant using the Black Scholes option-pricing model with the following weighted average assumptions and results for fiscal 2020, 2019 and 2018.
Weighted Average |  | 2020 | 2019 | 2018
Expected dividend yield |  | 0.0% | 0.0% | 0.0%
Risk-free interest rate |  | 1.65% | 2.61% | 2.54%
Expected term |  | 5.94 years | 6.00 years | 5.82 years
Expected volatility |  | 27.4% | 29.6% | 29.3%
Fair value of options granted |  | $8.64 | $7.16 | $6.37
The expected life of options granted in fiscal 2020 were computed using the Company's historical data based on exercised and cancelled options. The expected lives for options granted during fiscal 2019 and 2018 were computed using the simplified method since the option plans historical exercise data did not provided a reasonable basis for estimating the expected term for the option grants. For the year ended January 2, 2021, the amount of cash received from the exercise of options was approximately $0.1 million and the related tax benefit was $2.4 million. For the year ended December 28, 2019, the amount of cash received from the exercise of options was less than approximately $0.1 million and the related tax benefit was approximately $0.4 million. For the year ended December 29, 2018, the amount of cash received from the exercise of options was less than $0.2 million and the related tax benefit was approximately $0.2 million. The total intrinsic value of options exercised for the years ended January 2, 2021, December 28, 2019 and December 29, 2018 was approximately $19.5 million, $4.7 million and $1.1 million, respectively. The fair value of shares vested for the years ended January 2, 2021, December 28, 2019 and December 29, 2018 was approximately $17.4 million, $15.5 million and $12.5 million, respectively. At January 2, 2021, the aggregate intrinsic value of options outstanding was approximately $149.0 million and the aggregate intrinsic value of options exercisable was approximately $110.2 million. Non-Vested Stock, Restricted Stock Unit and Performance Share Unit Awards. The Company has in the past granted non-vested stock and restricted stock unit (RSU) awards to certain of the Company's employees as part of the LTIP under the 2012 Omnibus Plan. Starting in 2016, the Committee made changes to the LTIP and instead of the non-vested stock and RSU awards, the Company began to grant performance share unit awards as part of the LTIP. In addition, the Company has granted performance share unit awards, individual non-vested stock and RSU awards to key employees from time to time at the discretion of the Committee. Non-vested stock is generally granted to U.S. based employees, while RSUs are generally granted to foreign based employees, with each RSU equivalent to one share of common stock and payable upon vesting in an equivalent number of shares of Darling common stock. For grants made under the 2017 Omnibus Plan, both non-vested stock and RSUs generally vest on the first three anniversary dates of the grant. Generally, upon termination of employment (voluntary or with cause), non-vested stock, RSUs and discretionary performance share awards that have not vested are forfeited. Upon, death, disability or qualifying retirement, a pro-rata portion of the unvested non-vested and RSU awards will vest and be payable. In fiscal 2020, the Committee granted 11,000 non-vested shares of stock to various individuals that vest on the first anniversary of the grant. A summary of the Company’s non-vested stock, restricted stock unit and performance share unit awards as of January 2, 2021, and changes during the year ended is as follows:
| Non-Vested, RSU and PSU Shares |  | Weighted Average Grant Date Fair Value
Stock awards outstanding December 30, 2017 | 360,344 |  |  | $ | 13.18 |
Shares granted | — |  |  | — |
Shares vested | (228,991) |  |  | 13.11 |
Shares forfeited | (2,779) |  |  | 12.11 |
Stock awards outstanding December 29, 2018 | 128,574 |  |  | 13.32 |
Shares granted | — |  |  | — |
Shares vested | (126,511) |  |  | 12.13 |
Shares forfeited | (1,313) |  |  | 14.92 |
Stock awards outstanding December 28, 2019 | 750 |  |  | 15.50 |
Shares granted | 11,000 |  |  | 35.66 |
Shares vested | (375) |  |  | 15.50 |
Shares forfeited | — |  |  | — |
Stock awards outstanding January 2, 2021 | 11,375 |  |  | $ | 35.00 |
Fiscal 2020 LTIP PSU Awards. On January 6, 2020, the Committee granted 224,481 PSUs under the Company's 2020 LTIP. The PSUs are tied to a three-year forward-looking performance period and will be earned based on the Company's average return on capital employed (ROCE), as calculated in accordance with the terms of the award agreement, relative to the average ROCE of the Company's performance peer group companies over the same performance period, with the earned award to be determined in the first quarter of fiscal 2023, after the final results for the relevant performance period are determined. Fiscal 2019 LTIP PSU Awards. On January 25, 2019, the Committee granted 305,195 PSUs under the Company's 2019 LTIP. The PSUs are tied to a three-year forward-looking performance period and will be earned based on the Company's average return on capital employed (ROCE), as calculated in accordance with the terms of the award agreement, relative to the average ROCE of the Company's performance peer group companies over the same performance period, with the earned award to be determined in the first quarter of fiscal 2022, after the final results for the relevant performance period are determined. Fiscal 2018 LTIP PSU Awards. On January 29, 2018, the Committee granted 295,514 PSUs under the Company's 2018 LTIP. The PSUs are tied to a three-year forward-looking performance period and will be earned based on the Company's average return on capital employed (ROCE), as calculated in accordance with the terms of the award agreement, relative to the average ROCE of the Company's performance peer group companies over the same performance period, with the earned award to be determined in the first quarter of fiscal 2021, after the final results for the relevant performance period are determined. Under the 2020 LTIP, 2019 LTIP and 2018 LTIP, PSUs were granted at target level; however, actual awards may vary between 0% and 225% of the target number of PSUs, depending on the performance level achieved. In addition, the number of PSUs earned may be reduced (up to 30%) or increased (capped at the maximum payout) based on the Company's total shareholder return (TSR) over the performance period. The fair value of each 2020 LTIP, 2019 LTIP and 2018 LTIP PSU award under the Company's 2020 LTIP, 2019 LTIP and 2018 LTIP was estimated on the date of grant using a Monte Carlo model with the following weighted average assumptions for fiscal 2020, fiscal 2019 and fiscal 2018.
Weighted Average |  | 2020 | 2019 | 2018
Expected dividend yield |  | 0.0% | 0.0% | 0.0%
Risk-free interest rate |  | 1.55% | 2.58% | 2.25%
Expected term |  | 2.99 years | 2.93 years | 2.93 years
Expected volatility |  | 25.8% | 30.7% | 34.4%
A summary of the Company’s 2020, 2019 and 2018 LTIP PSU awards as of January 2, 2021, and changes during the year ended is as follows:
| LTIP PSU Shares |  | Weighted Average Grant Date Fair Value
LTIP PSU awards outstanding December 30, 2017 | 1,141,016 |  |  | $ | 8.91 |
Granted | 295,514 |  |  | 20.60 |
Additional PSU awards vested from performance | 88,151 |  |  | 6.95 |
Stock issued for PSUs | (26,212) |  |  | 6.95 |
Forfeited | (16,493) |  |  | 9.39 |
LTIP PSU awards outstanding December 29, 2018 | 1,481,976 |  |  | $ | 11.15 |
Granted | 305,195 |  |  | 21.50 |
Additional PSU awards vested from performance | 235,126 |  |  | 7.23 |
Stock issued for PSUs | (125,067) |  |  | 7.84 |
Forfeited | (3,757) |  |  | 19.09 |
LTIP PSU awards outstanding December 28, 2019 | 1,893,473 |  |  | $ | 12.54 |
Granted | 224,481 |  |  | 31.80 |
Additional PSU awards vested from performance | 434,666 |  |  | 11.14 |
Stock issued for PSUs | (349,210) |  |  | 8.91 |
Forfeited | (332) |  |  | 26.88 |
LTIP PSU awards outstanding January 2, 2021 | 2,203,078 |  |  | $ | 14.80 |
Nonemployee Director Restricted Stock and Restricted Stock Unit Awards. On February 24, 2011, the Company's Board of Directors approved an Amended and Restated Non-Employee Director Restricted Stock Award Plan (the “Director Restricted Stock Plan”) pursuant to and in accordance with the Company's 2004 Omnibus Incentive Plan (the “2004 Omnibus Plan”) in order to attract and retain highly qualified persons to serve as non-employee directors and to more closely align such directors' interests with the interests of the stockholders of the Company by providing a portion of their compensation in the form of Company common stock. Under the Director Restricted Stock Plan, $60,000 in restricted Company common stock was awarded to each non-employee director on the fourth business day after the Company released its earnings for its prior completed fiscal year (the “Date of Award”). The amount of restricted stock to be issued was calculated using the closing price of the Company’s common stock on the third business day after the Company released its earnings. The restricted stock was subject to a right of repurchase at $0.01 per share upon termination of the holder as a member of the Company's board of directors for cause and was not transferable. These restrictions lapse with respect to 100% of the restricted stock upon the earliest to occur of (i) 10 years after the date of award, (ii) a Change of Control (as defined in the 2004 Omnibus Plan), and (iii) termination of the non-employee director's service with the Company, other than for “cause” (as defined in the Director Restricted Stock Plan). Beginning in fiscal 2014, the Board discontinued grants to non-employee directors under the Director Restricted Stock Plan described above, and in lieu thereof, as an additional element of annual non-employee director compensation, pursuant to the 2012 Omnibus Plan, each non-employee director received $90,000 of restricted stock units immediately following the Company’s annual meeting of stockholders at which such directors are elected. Beginning in fiscal 2017, the Board increased the dollar amount of the annual grant of restricted stock units to $110,000, and such grants are now made under the 2017 Omnibus Plan. The number of restricted stock units to be issued is calculated using the closing price of the Company’s stock on the date of its annual meeting. The award vests (and is no longer subject to forfeiture) on the first to occur of (i) the first anniversary of the grant date, (ii) the grantee’s separation from service as a result of death or disability, or (iii) a change of control. The award will become “payable” in shares of the Company’s stock in a single lump sum payment as soon as possible following a grantee’s separation from service, subject to a grantee’s right to elect earlier distributions under certain circumstances. If a grantee ceases to be a director for any reason other than death or disability prior to vesting, the grantee will receive a prorated amount of the award up to the date of separation. A summary of the Company’s non-employee director restricted stock awards as of January 2, 2021, and changes during the year ended is as follows:
| Restricted stock and Restricted Stock Unit Shares |  | Weighted Average Grant Date Fair Value
Stock awards outstanding December 30, 2017 | 154,809 |  |  | $ | 14.91 |
Restricted shares granted | 61,806 |  |  | 16.92 |
Restricted shares where the restriction lapsed | (1,438) |  |  | 13.90 |
Restricted shares forfeited | — |  |  | — |
Stock awards outstanding December 29, 2018 | 215,177 |  |  | 15.49 |
Restricted shares granted | 52,990 |  |  | 20.76 |
Restricted shares where the restriction lapsed | (6,803) |  |  | 2.94 |
Restricted shares forfeited | — |  |  | — |
Stock awards outstanding December 28, 2019 | 261,364 |  |  | 16.89 |
Restricted shares granted | 48,267 |  |  | 20.51 |
Restricted shares where the restriction lapsed | (73,354) |  |  | 16.33 |
Restricted shares forfeited | — |  |  | — |
Stock awards outstanding January 2, 2021 | 236,277 |  |  | $ | 17.79 |

X
- Definition Stockholders' Equity and Stock-Based Compensation [Abstract] + References No definition available. + Details
Name: | dar_StockholdersEquityAndStockBasedCompensationAbstract
Namespace Prefix: | dar_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(e)(1)) -URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.3-04) -URI http://asc.fasb.org/extlink&oid=120397183&loc=d3e187085-122770 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -URI http://asc.fasb.org/topic&trid=2208762 + Details
Name: | us-gaap_StockholdersEquityNoteDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration