Stock-Based Compensation

12 Months Ended

Dec. 31, 2015

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

2013 Long-Term Incentive Plan

Under our 2013 Long-Term Incentive Plan (the “LTIP”), stock options, SARs, restricted stock, restricted stock units, dividend equivalent rights and other types of equity and cash incentive awards may be granted to employees, non-employee directors and service providers. The LTIP expires after 10 years, unless prior to that date the maximum number of shares available for issuance under the plan has been issued or our board of directors terminates the plan. There are 20,000,000 shares of common stock reserved for issuance under the LTIP. As of December 31, 2015, 16,038,580 shares remained available for issuance.

Restricted Stock Units

Upon completion of the IPO and pursuant to the LTIP, we began granting restricted stock units. Substantially all RSUs granted under the LTIP vest ratably over a period of two to three years. Certain restricted stock unit awards provide for accelerated vesting for qualifying terminations of employment or service.

Employees granted RSUs are not entitled to dividends declared on the underlying shares while the restricted stock unit is unvested. As such, the grant date fair value of the award is measured by reducing the grant date price of our common stock by the present value of the dividends expected to be paid on the underlying shares during the requisite service period, discounted at the appropriate risk-free interest rate. The weighted average grant date fair value of RSUs granted during the years ended December 31, 2015, 2014 and 2013 was $14.6 million, $3.1 million and $74.1 million, respectively. Compensation expense is recognized ratably over the vesting period. As of December 31, 2015, we assumed no annual forfeiture rate because of our lack of turnover and history for this type of award.

Stock-based compensation expense relating to RSUs included in general and administrative expenses on the consolidated statements of income for the years ended December 31, 2015, 2014 and 2013 was $26.1 million, $38.4 million and $7.2 million, respectively. An additional $2.3 million of stock-based compensation expense was recorded in severance and other charges as a result of our reduction efforts mentioned in Note 20, bringing the total stock-based compensation expense recorded to $28.4 million for the year ended December 31, 2015. Unamortized stock compensation expense as of December 31, 2015 relating to RSUs totaled approximately $15.1 million which will be expensed over a weighted average period of 1.29 years.

Non-vested RSUs outstanding as of December 31, 2015 and the changes during the year were as follows:



			Weighted
	Number of		Average Grant
	Shares		Date Fair Value
Non-vested at December 31, 2014	2,577,237		$	20.98
Granted	932,202		15.71
Vested	(1,069,630	)	20.94
Forfeited	(80,436	)	19.91
Non-vested at December 31, 2015	2,359,373		$	18.95

Employee Stock Purchase Plan

In connection with the completion of our IPO, we adopted the Frank's International N.V. ESPP, which became effective January 1, 2015. Under the ESPP, eligible employees have the right to purchase shares of common stock at the lesser of (i) 85% of the last reported sale price of our common stock on the last trading date immediately preceding the first day of the option period, or (ii) 85% of the last reported sale price of our common stock on the last trading date immediately preceding the last day of the option period. The ESPP is intended to qualify as an employee stock purchase plan under Section 423 of the Internal Revenue Code. We have reserved three million shares of our common stock for issuance under the ESPP. Shares of our common stock issued to our employees under the ESPP totaled 20,291 shares in 2015. For the year ended December 31, 2015, we recognized $0.2 million of compensation expense related to stock purchased under the ESPP.

In January 2016, we issued 28,454 shares of our common stock to our employees under this plan to satisfy the employee purchase period from July 1, 2015 to December 31, 2015, which increased our common stock outstanding. There are currently 2,951,255 shares available under this plan.