Equity Incentive Plans

12 Months Ended

Dec. 31, 2019

Share-based Payment Arrangement [Abstract]

On January 22, 2016, the Company’s Board of Directors adopted the Acushnet Holdings Corp. 2015 Omnibus Incentive Plan (“2015 Plan”) pursuant to which the Company may grant stock options, stock appreciation rights, restricted shares of common stock, restricted stock units ("RSUs"), performance stock units (“PSUs”) and other share-based and cash-based awards to members of the Board of Directors, officers, employees, consultants and advisors of the Company. The 2015 Plan is administered by the compensation committee (the “Administrator”). The Administrator has the authority to establish the terms and conditions of any award issued or granted under the 2015 Plan. As of December 31, 2019, the only awards that have been granted under the 2015 Plan are RSUs and PSUs.

Restricted Stock and Performance Stock Units

RSUs granted to members of the Board of Directors vest immediately into shares of common stock. RSUs granted to Company officers, employees, consultants and advisors of the Company vest ratably and in accordance with the terms of the grant, generally over one to three years subject to the recipient’s continued service to the Company. PSUs vest, subject to the recipient's continued employment with the Company, based upon the Company's performance against specified metrics which are generally over a three year performance period as defined in the award agreement. At the end of the performance period, the number of shares of stock that could be issued is fixed based upon the degree of achievement of the performance goals. The number of shares that could be issued can range from 0% to 200% of the participant's target award. Recipients of the awards granted under the 2015 Plan may elect to defer receipt of all or any portion of any shares of common stock issuable upon vesting to a future date elected by the recipient.

All RSUs and PSUs granted under the 2015 Plan have DERs, which entitle holders of RSUs and PSUs to the same dividend value per share as holders of common stock and can be paid in either cash or common stock. DERs are subject to the same vesting and other terms and conditions as the corresponding unvested RSUs and PSUs. DERs are paid when the underlying shares of common stock are delivered.

Each share issued with respect to RSUs and PSUs granted under the 2015 Plan reduces the number of shares available for grant. RSUs and PSUs forfeited and shares withheld to satisfy tax withholding obligations increase the number of shares available for grant. As of December 31, 2019, there were 6,664,012 remaining shares of common stock reserved for issuance under the 2015 Plan of which 5,060,479 remain available for future grants.

A summary of the Company’s RSUs and PSUs as of December 31, 2019 and 2018 and changes during the years then ended is presented below:



	Number of RSUs		Weighted- Average Fair Value RSUs		Number of PSUs		Weighted- Average Fair Value PSUs
Outstanding as of December 31, 2017	874,942		$	20.15	1,185,912		$	20.29
Granted	473,724		23.49		—		—
Vested ⁽¹⁾	(466,834	)	20.52		(900,226	)	20.29
Forfeited	—		—		(285,686	)	20.29
Outstanding as of December 31, 2018	881,832		$	21.75	—		$	—
Granted	655,522		23.51		207,077		23.47
Vested ⁽²⁾	(567,836	)	20.81		—		—
Forfeited	(22,275	)	23.92		—		—
Outstanding as of December 31, 2019	947,243		$	23.49	207,077		$	23.47

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⁽¹⁾	Included 63,490 shares of common stock related to RSUs and 900,226 shares of common stock related to PSUs that were not delivered as of December 31, 2018. The aggregate fair value of RSUs vested and PSUs vested was $10.0 million and $19.0 million, respectively.


⁽²⁾	Included 161,165 shares of common stock related to RSUs and no shares of common stock related to PSUs that were not delivered as of December 31, 2019. The aggregate fair value of RSUs vested was $12.9 million.

A summary of shares of common stock issued related to the 2015 Plan, including the impact of any DERs issued in common stock, is presented below:



	Year ended				Year ended
	December 31, 2019				December 31, 2018
	RSUs		PSUs		RSUs	PSUs
Shares of common stock issued	410,787		900,226		403,538	—
Shares of common stock withheld by the Company as payment by employees in lieu of cash to satisfy tax withholding obligations	(126,242	)	(325,246	)	(122,795)	—
Net shares of common stock issued	284,545		574,980		280,743	—

Cumulative undelivered shares of common stock	220,582		—		63,490	900,226

Compensation expense recorded related to RSUs and PSUs in the consolidated statement of operations was as follows:



	Year ended December 31,
(in thousands)	2019		2018		2017
RSU	$	9,140	$	12,353	$	9,318
PSU	1,507		6,210		5,967

The remaining unrecognized compensation related to non-vested RSUs and non-vested PSUs granted was $13.4 million and $3.4 million, respectively, as of December 31, 2019 and is expected to be recognized over the related weighted average period of 1.7 years and 2.0 years, respectively.

Compensation Expense

The allocation of share-based compensation expense in the consolidated statement of operations was as follows:



	Year ended December 31,
(in thousands)	2019		2018		2017
Cost of goods sold	$	722	$	680	$	408
Selling, general and administrative expense	9,402		16,507		13,687
Research and development	851		1,376		1,190
Total compensation expense before income tax	10,975		18,563		15,285
Income tax benefit	2,440		4,398		3,158
Total compensation expense, net of tax	$	8,535	$	14,165	$	12,127