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Share-based Compensation | 12 Months Ended
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Dec. 31, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] |
Share-based Compensation | SHARE-BASED COMPENSATION The Company’s share-based compensation awards are issued under the 2015 Equity Incentive Plan (“2015 Plan”) and predecessor plan, the 2007 Equity Incentive Plan (“2007 Plan”). Any awards that expire or are forfeited under the 2007 Plan become available for issuance under the 2015 Plan. The Company accounts for forfeitures as they occur when calculating share-based compensation expense. The aforementioned plans provide for the issuance of previously unissued common stock in connection with the exercise of stock options and conversion of other share-based awards. As of December 31, 2018, 2.4 million shares of common stock remained available for future issuance under all plans, subject to adjustment for future stock splits, stock dividends, and similar changes in capitalization. Share-Based Compensation Expense Pre-tax share-based compensation expense reported in the Company’s consolidated statements of operations was:
| Year Ended December 31,
| 2018 |  | 2017 |  | 2016
| (in thousands)
Cost of sales | $ | 362 |  |  | $ | 379 |  |  | $ | 488 |
Selling, general and administrative expenses | 12,743 |  |  | 9,394 |  |  | 10,199 |
Total share-based compensation expense | $ | 13,105 |  |  | $ | 9,773 |  |  | $ | 10,687 |
Stock Option Activity Stock option activity during the year ended December 31, 2018 was:
| Shares |  | Weighted Average Exercise Price |  | Weighted Average Contractual Life (Years) |  | Aggregate Intrinsic Value
| (in thousands, except exercise price and years)
Outstanding as of December 31, 2017 | 541 |  |  | $ | 11.00 |  |  | 5.37 |  | $ | 1,918 |
Granted | — |  |  | — |  |  |  |  |
Exercised | (152 | ) |  | 8.36 |  |  |  |  |
Forfeited or expired | (27 | ) |  | 25.09 |  |  |  |  |
Outstanding as of December 31, 2018 | 362 |  |  | $ | 11.05 |  |  | 5.68 |  | $ | 5,407 |
Exercisable at December 31, 2018 | 226 |  |  | $ | 13.40 |  |  | 4.08 |  | $ | 2,846 |
Vested and expected to vest at December 31, 2018 | 362 |  |  | $ | 11.05 |  |  | 5.68 |  | $ | 5,407 |
No stock options were granted during 2018 or 2016. During the year ended December 31, 2017, stock options were valued using a Black Scholes option pricing model using the following assumptions.
| Year Ended December 31, 2017
Expected volatility | 40.7%
Dividend yield | —
Risk-free interest rate | 1.76%
Expected life (in years) | 4.0
The weighted average grant date fair value of stock options granted during the year ended December 31, 2017 was approximately $2.37 per share. The aggregate intrinsic value of stock options exercised during the years ended December 31, 2018, 2017, and 2016 was $1.7 million, $0.1 million, and $0.5 million, respectively. During the years ended December 31, 2018, 2017, and 2016, the Company received $1.3 million, $0.1 million, and $0.4 million cash in connection with the exercise of stock options. As of December 31, 2018, the Company had $0.2 million of total unrecognized share-based compensation expense related to unvested options, which is expected to be amortized over the remaining weighted average period of 1.4 years. Stock options under the 2015 Plan and 2007 Plan generally vest ratably over four years with the first vesting occurring one year from the date of grant, followed by monthly vesting for the remaining three years, and expire ten years after the date of grant. Restricted Stock Awards and Restricted Stock Units Activity From time to time, the Company grants RSAs and RSUs. RSAs and RSUs generally vest over three years, depending on the terms of the grant. Holders of unvested RSAs have the same rights as those of common stockholders including voting rights and non-forfeitable dividend rights. However, ownership of unvested RSAs cannot be transferred until vested. Holders of unvested RSUs have a contractual right to receive a share of common stock upon vesting. RSUs have dividend equivalent rights which accrue over the term of the award and are paid if and when the RSUs vest, but RSU holders have no voting rights. The Company grants service-condition RSUs, performance-condition RSUs, and market-condition RSUs. Service-condition RSUs are typically granted on an annual basis and vest over time in three equal annual installments, beginning one year after the grant date. During the years ended December 31, 2018, 2017, and 2016, the Company granted 0.4 million, 1.1 million, and 1.0 million service-condition RSUs, respectively. Performance-condition RSUs are typically granted on an annual basis and consist of a performance-based and service-based component. The performance targets and vesting conditions for performance-condition RSUs are based on achievement of multiple weighted performance goals. The number of performance-condition RSUs ultimately awarded may be between 0% and 200%, based on performance. These RSUs vest in three equal annual installments beginning one year after the grant date, pending certification of performance achievement by the Compensation Committee and continued service. The fair value of performance-condition awards is based on the closing market price of our common stock on the grant date. Compensation expense, net of forfeitures, is updated for the Company’s expected performance level against performance goals at the end of each reporting period. The Company also periodically grants market-condition RSUs to certain executives. The grant date fair value and derived service period for market-condition RSUs are estimated using a Monte Carlo simulation valuation model. During the years ended December 31, 2018, 2017, and 2016, the Company granted 1.0 million, 1.3 million, and 1.2 million performance- and market-condition RSUs, respectively. RSA and RSU activity during the year ended December 31, 2018 was:
| Restricted Stock Awards (1) |  | Restricted Stock Units
| Shares |  | Weighted Average Grant Date Fair Value |  | Shares |  | Weighted Average Grant Date Fair Value
| (in thousands, except fair value data)
Unvested at December 31, 2017 | 17 |  |  | $ | 6.84 |  |  | 3,791 |  |  | $ | 7.99 |
Granted | 13 |  |  | 18.61 |  |  | 1,404 |  |  | 14.34 |
Vested | (24 | ) |  | 10.09 |  |  | (1,123 | ) |  | 8.60 |
Forfeited | — |  |  | — |  |  | (1,320 | ) |  | 7.67 |
Unvested at December 31, 2018 | 6 |  |  | $ | 18.61 |  |  | 2,752 |  |  | $ | 11.58 |
(1) Excludes shares granted to members of the Board for annual equity awards. The weighted average grant date fair value of RSAs granted during the years ended December 31, 2018, 2017, and 2016 was $18.61, $6.84, and $10.28 per share. RSAs vested during the years ended December 31, 2018, 2017, and 2016 consisted entirely of service-based awards. The total grant date fair value of RSAs vested was $0.2 million in each of the years ended December 31, 2018, 2017, and 2016. As of December 31, 2018, unrecognized share-based compensation expense for RSAs was $0.1 million, which is expected to amortize over a remaining weighted average period of 0.4 years. The weighted average grant date fair value of RSUs granted during the years ended December 31, 2018, 2017, and 2016 was $14.34, $6.84, and $9.16 per share. RSUs vested during the year ended December 31, 2018 consisted of 0.9 million service-condition awards and 0.2 million performance- and market-condition awards. RSUs vested during the year ended December 31, 2017 consisted of 0.7 million service-condition awards and 0.1 million performance- and market-condition awards. RSUs vested during the year ended December 31, 2016 consisted of 0.6 million service-condition awards and less than 0.1 million performance- and market-condition awards. The total grant date fair value of RSUs vested during the years ended December 31, 2018, 2017, and 2016 was $9.7 million, $8.3 million and $8.0 million, respectively. As of December 31, 2018, unrecognized share-based compensation expenses for service-condition RSUs were $7.7 million and for performance- and market-condition RSUs were $6.4 million, and are expected to amortize over remaining weighted average periods of 1.3 years and 2.4 years, respectively.

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- Definition The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -URI http://asc.fasb.org/topic&trid=2228938 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 50 -URI http://asc.fasb.org/subtopic&trid=2208855 + Details
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