XML 36 R21.htm IDEA: XBRL DOCUMENT
v3.10.0.1

Note 13 - Stock-based Compensation and Purchase Plans | 12 Months Ended
--- | ---
Jun. 30, 2018
Notes to Financial Statements |
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | 13. stock-based compensation and purchase plans Stock-Based Compensation Plans Under incentive compensation plans, the Company is authorized to make grants of stock options, restricted stock and performance share units to provide equity incentive compensation to key employees and directors. The stock award program offers employees and directors the opportunity to earn shares of our stock over time, rather than options that give the employees and directors the right to purchase stock at a set price. The Company has stock plans for directors, officers and certain key employees. Total compensation cost recognized in income for equity based compensation awards was $4.9 million, $5.0 million, and $5.1 million for the years ended June 30, 2018, 2017, and 2016, respectively, primarily within Selling, General, and Administrative Expenses. The total income tax benefit recognized in the consolidated statement of operations for equity-based compensation plans was $1.2 million, $1.9 million, and $1.8 million for the years ended June 30, 2018, 2017 and 2016, respectively. There were 157,921 shares of common stock reserved for issuance under various compensation plans at June 30, 2018. Restricted Stock Awards The Company may award shares of restricted stock to eligible employees and non-employee directors of the Company at no cost, giving them in most instances all of the rights of stockholders, except that they may not sell, assign, pledge or otherwise encumber such shares and rights during the restriction period. Such shares and rights are subject to forfeiture if certain employment conditions are not met. During the restriction period, recipients of the shares are entitled to dividend equivalents on such shares, providing that such shares are not forfeited. Dividends are accumulated and paid out at the end of the restriction period. During 2018, 2017, and 2016, the Company granted 51,792, 51,563, and 48,984 shares, respectively, of restricted stock to eligible participants. Restrictions on the stock awards generally lapse between fiscal 2018 and fiscal 2020. For the years ended June 30, 2018, 2017, and 2016, $3.7 million, $3.6 million, and $2.6 million, respectively, was recognized as compensation expense related to restricted stock awards. Substantially all awards are expected to vest. A summary of restricted stock awards activity during the year ended June 30, 2018 is as follows:
|  | Restricted Stock Awards |
|  | Number |  |  | Aggregate |
|  | of |  |  | Intrinsic |
|  | Shares |  |  | Value |
Outstanding, June 30, 2017 |  |  | 115,703 |  |  | $ | 10,494,262 |
Granted |  |  | 51,792 |  |  |  |  |
Exercised / vested |  |  | (37,970 | ) |  | $ | 757,216 |
Canceled |  |  | (9,515 | ) |  |  |  |
Outstanding, June 30, 2018 |  |  | 120,010 |  |  | $ | 12,258,515 |
Restricted stock awards granted during 2018, 2017 and 2016 had a weighted average grant date fair value of $93.73, $85.07, and $77.38, respectively. The grant date fair value of restricted stock awards is determined based on the closing price of the Company’s common stock on the date of grant. The total intrinsic value of awards exercised during the years ended June 30, 2018, 2017, and 2016 was $0.8 million, $0.8 million, and $1.1 million, respectively. As of June 30, 2018, there was $4.1 million of unrecognized compensation costs related to awards expected to be recognized over a weighted-average period of 1.38 years. Executive Compensation Program The Company operates a compensation program for key employees. The plan contains both an annual component as well as a long-term component. Under the annual component, participants may elect to defer up to 50% of their annual incentive compensation in restricted stock which is purchased at a discount to the market. Additionally, non-employee directors of the Company may defer a portion of their director’s fees in restricted stock units which is purchased at a discount to the market. During the restriction period, recipients of the shares are entitled to dividend equivalents on such units, providing that such shares are not forfeited. Dividend equivalents are accumulated and paid out at the end of the restriction period. The restrictions on the units expire after three years. At June 30, 2018 and 2017, respectively, 31,760 and 35,707 shares of restricted stock units are outstanding and subject to restrictions that lapse between fiscal 2018 and fiscal 2020. The compensation expense associated with this incentive program is charged to income over the restriction period. The Company recorded compensation expense related to this program of $0.3 million, $0.4 million, and $0.2 million for the years ended June 30, 2018, 2017 and 2016, respectively. As of June 30, 2018, there was $0.3 million of unrecognized compensation costs related to awards expected to be recognized over a weighted-average period of 1.21 years. The fair value of the awards under the annual component of this incentive program is measured using the Black-Scholes option-pricing model. Key assumptions used to apply this pricing model are as follows:
|  | 2018 |  |  | 2017 |  |  | 2016 |
Risk-free interest rates |  |  | 1.55 | % |  |  | 0.71 | % |  |  | 1.10 | %
Expected life of option grants (in years) |  |  | 3 |  |  |  | 3 |  |  |  | 3 |
Expected volatility of underlying stock |  |  | 25.6 | % |  |  | 25.7 | % |  |  | 26.6 | %
Expected quarterly dividends (per share) |  | $ | 0.16 |  |  | $ | 0.14 |  |  | $ | 0.12 |
Under the long-term component, grants of performance share units (“PSUs”) are made annually to key employees and the share units are earned based on the achievement of certain overall corporate financial performance targets over the performance period. At the end of the performance period, the number of shares of common stock issued will be determined by adjusting upward or downward from the target in a range between 50% and 200%. No shares will be issued if the minimum performance threshold is not achieved. The final performance percentage, on which the payout will be based, considering the performance metrics established for the performance period, will be certified by the Compensation Committee of the Board of Directors. Beginning in 2017, awards granted by the Committee provide that the PSUs will be converted to shares of common stock if the Company’s EBITDA (earnings before interest, taxes, depreciation and amortization) and return on invested capital meet specified levels approved by the Committee. A participant’s right to any shares that are earned will cliff vest in three years. An executive whose employment terminates prior to the vesting of any award for a reason other than death, disability, retirement, or following a change in control, will forfeit the shares represented by that award. In certain circumstances, such as death, disability, or retirement, PSUs are paid on a pro-rata basis. In the event of a change in control, vesting of the awards granted is accelerated. A summary of the awards activity under the executive compensation program during the year ended June 30, 2018 is as follows:
|  | Annual Component |  |  | Performance Stock Units |
|  |  |  |  |  | Weighted |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Number |  |  | Average |  |  | Aggregate |  |  | Number |  |  | Aggregate |
|  | of |  |  | Exercise |  |  | Intrinsic |  |  | of |  |  | Intrinsic |
|  | Shares |  |  | Price |  |  | Value |  |  | Shares |  |  | Value |
Non-vested, June 30, 2017 |  |  | 35,707 |  |  | $ | 59.11 |  |  | $ | 318,334 |  |  |  | 52,890 |  |  | $ | 4,254,256 |
Granted |  |  | 9,050 |  |  | $ | 68.03 |  |  |  |  |  |  |  | 24,567 |  |  |  |  |
Vested |  |  | (10,930 | ) |  | $ | 55.76 |  |  |  | 428,893 |  |  |  | (15,780 | ) |  | $ | 1,194,319 |
Forfeited |  |  | (2,067 | ) |  | $ | 60.62 |  |  |  |  |  |  |  | (3,167 | ) |  |  |  |
Non-vested, June 30, 2018 |  |  | 31,760 |  |  | $ | 62.71 |  |  |  | 442,850 |  |  |  | 58,028 |  |  | $ | 5,013,531 |
Restricted stock awards granted under the annual component of this program in fiscal 2018, 2017, and 2016 had a grant date fair value of $96.56, $87.05, and $82.79, respectively. The PSUs granted in fiscal 2018, 2017 and 2016 had a grant date fair value of $91.75, $83.92, and $76.61, respectively. The total intrinsic value of awards vested under the executive compensation program during the years ended June 30, 2018 was $1.6 million, and $2.3 million for the years ended June 30, 2017 and June 30, 2016. The Company recognized compensation expense related to the PSUs of $0.9 million, $1.0 million, and $2.3 million for the years ended June 30, 2018, 2017 and 2016 respectively based on the probability of the performance targets being met. The total unrecognized compensation costs related to non-vested performance share units was $2.0 million at June 30, 2018, which is expected to be recognized over a weighted average period of 1.3 years. Employee Stock Purchase Plan The Company has an Employee Stock Purchase Plan that allows employees to purchase shares of common stock of the Company at a discount from the market each quarter. The ESPP plan, which was effective as of July 1, 2005, provided employees the option to purchase Standex stock at a discount of 5%. The Plan was modified, effective as of April 1, 2017, to increase the stock purchase discount to 15% and is considered a compensatory Plan. Under this new Plan, shares of our stock may be purchased by employees quarterly at 85% of the fair market value on the last day of each quarter. The 15% discount is recorded as a component of SG&A in the Company’s Consolidated Statements of Operations. Shares of stock reserved for the plan were 81,315 at June 30, 2018. Shares purchased under this plan aggregated to 5,622, 3,742, and 3,809 in 2018, 2017 and 2016, respectively, at an average price of $86.01, $84.17, and $75.66, respectively.

X
- 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
Name: | us-gaap_DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_DisclosureTextBlockAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration