XML 41 R15.htm IDEA: XBRL DOCUMENT
v3.20.4

Incentive Plans (Notes) | 12 Months Ended
--- | ---
Dec. 31, 2020
Share-based Payment Arrangement, Noncash Expense [Abstract] |
Incentive Plans |
9. | Incentive Plans
The Insperity, Inc. 2001 Incentive Plan, as amended, and the 2012 Incentive Plan, as amended, (collectively, the “Incentive Plans”) provide for options and other stock-based awards that have been and may be granted to eligible employees and non-employee directors of Insperity or its subsidiaries. The 2012 Incentive Plan is currently the only plan under which new stock-based awards may be granted.The 2001 Incentive Plan only has outstanding nonqualified stock options. The 2012 Incentive Plan permits stock options, including nonqualified stock options and options intended to qualify as “incentive stock options” within the meaning of Section 422 of the Internal Revenue Code, stock awards, phantom stock awards, stock appreciation rights, performance units, and other stock-based awards and cash awards, all of which may or may not be subject to the achievement of one or more performance objectives. The purpose of the Incentive Plan generally is to retain and attract persons of training, experience and ability to serve as employees of Insperity and its subsidiaries and to serve as non-employee directors of Insperity, to encourage the sense of proprietorship of such persons and to stimulate the active interest of such persons in the development and financial success of Insperity and its subsidiaries. The Incentive Plans are administered by the Compensation Committee of the Board (the “Committee”). The Committee has the power to determine which eligible employees will receive awards, the timing and manner of the grant of such awards, the exercise price of stock options (which may not be less than market value on the date of grant), the number of shares and all of the terms of the awards. The Board may at any time amend or terminate the Incentive Plans. However, no amendment that would impair the rights of any participant, with respect to outstanding grants, can be made without the participant’s prior consent. Stockholder approval of amendments to the Incentive Plans is necessary only when required by applicable law or stock exchange rules. Assuming all outstanding awards are paid at max, at December 31, 2020, 1,417,062 shares of common stock were available for future grants under the 2012 Incentive Plan. We also maintain the Insperity, Inc. Long-Term Incentive Plan (“LTIP”) under the 2012 Incentive Plan. The LTIP provides for performance-based long-term compensation awards in the form of performance units to certain employees based on the achievement of pre-established performance goals. We granted performance units under the LTIP to our named executive officers and certain other officers in 2018, 2019 and 2020. Beginning with stock-based awards granted in 2020, employees who attain a minimum age of 62 and have provided 15 years or more of continuous service may continue to vest in awards following a qualifying retirement as defined under the 2012 Incentive Plan award agreement, as though he or she were still an employee, provided the grant date of the award is six months or more before the employee’s last day of employment. For a termination following a qualifying retirement, time-vested awards will continue to vest in the normal course. For a termination following a qualifying retirement, performance-based awards with completed or in-process performance periods are adjusted for achievement of the performance criteria, prorated through the date of termination and paid in the normal course, while performance-based awards for performance periods that have not started are forfeited. Stock-based compensation expense related to time-vested and performance-based awards is accelerated over the requisite service period for employees who meet the requirements for continued vesting. Stock-based compensation expense and other disclosures for stock-based awards follows:
| Year Ended December 31,
(in thousands) | 2020 | 2019 | 2018
Stock-based compensation expense recognized | $ | 60,145 |  | $ | 23,993 |  | $ | 20,425 |
Income tax benefit realized from stock-based compensation expense | 16,217 |  | 4,876 |  | 5,249 |
Time-Based Restricted Stock Awards and Time-Based Restricted Stock Units Time-based restricted stock awards (“RSAs”) and time-based restricted stock units (“RSUs”), under equity plan accounting, are generally measured at fair value on the date of grant based on the number of shares granted, estimated forfeitures and the quoted price of the common stock. Such value is recognized as compensation expense over the corresponding vesting period, generally three years to five years for awards currently outstanding. However, for some RSUs currently outstanding, compensation expense is accelerated over the shortened requisite service period for employees who meet the requirements for continued vesting. Following is a summary of time-based RSAs and time-based RSUs award activity for 2020:
| Total Awards (in thousands) | Weighted Average Grant Date Fair Value
Non-vested - December 31, 2019 | 443 |  | $ | 86.10 |
Granted | 468 |  | 66.32 |
Vested | (262) |  | 70.65 |
Canceled | (13) |  | 79.89 |
Non-vested - December 31, 2020 | 636 |  | $ | 78.04 |
Additional disclosures for time-based RSAs and time-based RSUs:
| Year Ended December 31,
| 2020 | 2019 | 2018
Weighted average grant date fair value of awards granted | $ | 66.32 |  | $ | 124.04 |  | $ | 65.98 |
Fair value of awards vested during the year (in millions) | 18.1 |  | 39.7 |  | 1.2 |
As of December 31, 2020, unrecognized compensation expense associated with the unvested RSAs and RSUs outstanding was $26.1 million and is expected to be recognized over a weighted average period of 20 months. Long-Term Incentive Program Awards Each performance unit represents the right to receive common shares at a future date based on our performance against specified targets. The ultimate number of shares issued and the related compensation cost recognized is based on a comparison of the final performance metrics to the specified targets, which can range from 0% to 200% of the targeted amounts. A performance unit may be comprised of either a performance based award or a market-based award. For performance-based awards, performance units have a vesting schedule of three years and compensation expense is recognized based on the number of common shares expected to be issued and the market price per common share on the date of grant. Over the performance period, the number of shares expected to be issued is adjusted upward or downward based upon the probability of achievement of the performance targets. For market-based awards, performance units vest at the end of a three-year period assuming continued employment and achievement of market-based performance goals. The fair value of market-based performance awards was determined through the use of the Monte Carlo simulation method. The compensation expense for the LTIP awards is recognized on a straight-line basis over the vesting terms. The following is a summary of LTIP award activity, at 100% of targeted amount, for 2020:
| Number of Performance Units (in thousands) |  | Weighted Average Grant Date Fair Value
Unvested at December 31, 2019 | 272 |  |  | $ | 79.95 |
Granted | 113 |  |  | 70.05 |
Vested | (115) |  |  | 48.06 |
Unvested at December 31, 2020 | 270 |  |  | $ | 89.40 |
The determination of achievement results and corresponding vesting of the 2017 LTIP awards occurred in February 2020 resulting in the recipients receiving approximately 238,000 shares of common stock with a fair value $17.3 million. As of December 31, 2020, we estimate that approximately 167,000, 21,000 and 89,000 shares will vest with $0.3 million, $1.0 million and $2.4 million in unamortized compensation expense related to the 2018, 2019 and 2020 LTIP grants, respectively. Performance-Based Restricted Stock Units During 2020, we granted performance-based RSUs (“pRSU”) under the 2012 Incentive Plan to our named executive officers and certain other management. The pRSUs are performance-based short-term compensation awards in the form of performance units to certain employees based on the achievement of pre-established performance goals. Each pRSU represents the right to receive common shares at a future date based on our performance against specified targets. The ultimate number of shares issued and the related compensation cost recognized is based on a comparison of the final performance metrics to the specified targets, which can range from 0% to 300% of the targeted amounts. The pRSUs have a vesting schedule of less than one year and compensation expense is recognized based on the number of common shares expected to be issued and the market price per common share on the date of grant. For pRSUs currently outstanding, compensation expense is accelerated over the requisite service period for employees who meet the requirements for continued vesting. Over the performance period, the number of shares expected to be issued is adjusted upward or downward based upon the probability of achievement of the performance targets. During 2020, we granted approximately 221,000 pRSUs (at target) with a weighted average grant date fair value of $64.85 and canceled approximately 2,000 pRSUs (at target) with a weighted average grant date fair value of $65.19. At December 31, 2020, we had approximately 219,000 unvested pRSUs (at target) with a weighted average grant date fair value of $64.85. As of December 31, 2020, we estimate that approximately 379,000 pRSUs will vest with $1.5 million in unamortized compensation expense related to the 2020 pRSU grants. Employee Stock Purchase Plan Our employee stock purchase plan (the “ESPP”) enables employees to purchase shares of Insperity stock at a 5% discount. The ESPP is a non-compensatory plan under generally accepted accounting principles of stock-based compensation. As a result, no compensation expense is recognized in conjunction with this plan. Approximately 57,000, 29,000 and 30,000 shares were issued from treasury under the ESPP during fiscal years 2020, 2019 and 2018, respectively.

X
- Definition The entire disclosure for share-based payment arrangement. + 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 + 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_ShareBasedCompensationAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration