Stock-Based Compensation Plans

3 Months Ended

Mar. 31, 2021

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

NOTE 13 – STOCK-BASED COMPENSATION PLANS

The Company grants stock options and stock equivalent units (“SEUs”) from time to time as a long-term performance incentive. In certain cases the grants are subject to performance conditions such as the Company’s stock price. Where performance conditions apply the Monte Carlo simulation model is used to determine the fair values. Otherwise the Black-Scholes model is used to determine the fair values.

Stock option plans

The following table summarizes the transactions of the Company’s stock option plans for the three months ended March 31, 2021.


	Number of Options			Weighted Average Exercise Price		Weighted Average Grant-Date Fair Value
Outstanding at December 31, 2020		442,893		$	32.49	$	45.31
Granted - at discount		69,996		$	0.00	$	92.32
- at market value		10,388		$	99.85	$	32.71
Exercised		(18,493	)	$	27.24	$	37.03
Forfeited		(1,307	)	$	50.54	$	32.61

Outstanding at March 31, 2021		503,477		$	29.42	$	51.97

At March 31, 2021, there were 115,847 stock options that were exercisable, of which 77,979 had performance conditions attached.

The stock option compensation cost for the first three months of 2021 was $1.6 million (first three months of 2020 – $1.2 million). The total intrinsic value of options exercised in the first three months of 2021 was $0.6 million (first three months of 2020 – $4.2 million).

The total compensation cost related to

non-vested

stock options not yet recognized at March 31, 2021 was $12.1 million and this cost is expected to be recognized over the weighted-average period of 2.22 years.

Stock equivalent units

The following table summarizes the transactions of the Company’s SEUs for the three months ended March 31, 2021:


	Number of SEUs			Weighted Average Exercise Price		Weighted Average Grant-Date Fair Value
Outstanding at December 31, 2020		390,164		$	4.35	$	63.96
Granted - at discount		87,451		$	0.00	$	88.94
- at market value		3,803		$	99.85	$	32.71
Exercised		(6,275	)	$	1.36	$	42.82
Forfeited		(12,400	)	$	0.00	$	67.33

Outstanding at March 31, 2021		462,743		$	4.47	$	68.62

At March 31, 2021 there were 52,279 SEUs that are exercisable, of which 40,464 had performance conditions attached.

The charges for SEUs are spread over the life of the award subject to a revaluation to fair value each quarter. The revaluation may result in a charge or a credit to the income statement in the quarter dependent upon our share price and other performance criteria.

The SEU compensation for the first three months of 2021 was a $4.4 million

charge

(first three months of 2020 – $6.0 million credit). The total intrinsic value of SEUs exercised in the first three months of 2021 was $0.3 million (first three months of 2020 – $5.6 million).

The weighted-average remaining vesting period of

non-vested

SEUs is 2.26 years.