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Employee Incentive Plans | 6 Months Ended
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Jun. 30, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] |
Employee Incentive Plans | Employee Incentive Plans Short-Term Incentive Plans ("STI Plans") We have annual short-term incentive compensation plans for senior management and certain other employees payable at our election in cash, shares of common stock, or a combination of cash and shares of common stock. Amounts earned under STI Plans are based on our adjusted earnings before interest, taxes, depreciation and amortization ("Adjusted EBITDA"), modified for certain safety, quality, delivery, cost and individual performance factors. The Adjusted EBITDA targets are determined based on the economic value added ("EVA") of our Fabricated Products business. Most of our production facilities have similar programs for both hourly and salaried employees. As of June 30, 2016, we had a liability of $13.1 million recorded within Accrued salaries, wages and related expenses for estimated probable future payments relating to the six month performance period of our 2016 STI Plans. Long-Term Incentive Programs ("LTI Programs") General. Prior to May 26, 2016, executive officers and other key employees of the Company, as well as non-employee directors of the Company, were eligible to participate in the Kaiser Aluminum Corporation Amended and Restated 2006 Equity and Performance Incentive Plan ("2006 Plan"). Subject to certain adjustments that may be required from time to time to prevent dilution or enlargement of the rights of participants under the 2006 Plan, a total of 2,722,222 common shares were authorized for issuance under the 2006 Plan. On May 26, 2016, our stockholders approved the Kaiser Aluminum Corporation 2016 Equity and Incentive Compensation Plan ("2016 Plan"), which replaced and succeeded in its entirety the 2006 Plan. No grants will be made under the 2006 Plan on or after May 26, 2016, but outstanding awards granted under the 2006 Plan will continue unaffected. Effective May 26, 2016, executive officers and other key employees of the Company, as well as non-employee directors of the Company and certain persons who provide services to us that are equivalent to those typically provided by an employee, are eligible to participate in the 2016 Plan. Subject to certain adjustments that may be required from time to time to prevent dilution or enlargement of the rights of participants under the 2016 Plan, the number of shares of common stock available for awards is limited to 1,045,000 shares, minus, (i) one share for every one share subject to an award granted under the 2006 Plan between December 31, 2015 and the effective date of the 2016 Plan, plus (ii) any shares of our common stock that become available under the 2016 Plan as a result of forfeiture, cancellation, expiration, or cash settlement of awards. At June 30, 2016, 924,102 shares were available for awards under the 2016 Plan. Non-vested Common Shares and Restricted Stock Units. We grant non-vested common shares and restricted stock units to our non-employee directors, executive officers and other key employees. The restricted stock units have rights similar to the rights of non-vested common shares and each restricted stock unit that becomes vested entitles the recipient to receive one common share. For both non-vested common shares and restricted stock units, the service period is generally one year for non-employee directors and three years for executive officers and other key employees. In addition to non-vested common shares and restricted stock units, we grant performance shares to executive officers and other key employees. Each performance share that becomes vested entitles the recipient to receive one common share. Performance shares granted in 2014 and 2015 ("TSR-Based Performance Shares") are subject to performance conditions pertaining to our total shareholder return ("TSR") over a three-year performance period compared to the TSR of a specified group of peer companies. The number of TSR-Based Performance Shares that will ultimately vest under both the 2014-2016 and 2015-2017 LTI Programs and result in the issuance of common shares ranges between 0% to 200% of the target number of underlying common shares (constituting approximately one-half of the maximum payout) and depends on the percentile ranking of our TSR compared to the group of peer companies. Performance shares granted in 2016 consist of TSR-Based Performance Shares and performance shares subject to performance requirements ("CP-Based Performance Shares") pertaining to our cost performance as set forth in the 2016-2018 LTI Program. The number of CP-Based Performance Shares that will ultimately vest and result in the issuance of common shares ranges between 0% to 200% of the target number of underlying common shares (constituting approximately one-half of the maximum payout) and depends on the average annual cost performance achieved for the specified three-year performance period. During the first quarter of 2016, performance shares granted in 2013 ("EVA-Based Performance Shares") under the 2013-2015 LTI Program became fully vested (see "Summary of Activity" below). The EVA-Based Performance Shares were subject to performance conditions pertaining to our EVA performance, measured over the three-year performance period. The number of EVA-Based Performance Shares that vested and resulted in the issuance of common shares was dependent on the average annual EVA achieved for the specified three-year performance period. The vesting of performance shares resulting in the issuance and delivery of common shares, if any, under the 2014-2016, 2015-2017 and 2016-2018 LTI Programs will occur in 2017, 2018 and 2019, respectively. ASU No. 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting, was issued and early adopted in March 2016. ASU 2016-09 eliminates the requirement to estimate and apply a forfeiture rate to reduce stock compensation expense during the vesting period and, instead, account for forfeitures as they occur. ASU 2016-09 requires that this change be adopted using the modified retrospective approach. As such, we recorded a cumulative-effect adjustment of $0.8 million during the first quarter of 2016 to reduce our December 31, 2015 Retained earnings and increase our December 31, 2015 Additional paid in capital balances. Additionally, ASU 2016-09 addresses the presentation of excess tax benefits and employee taxes paid on the statement of cash flows. We are now required to present excess tax benefits as an operating activity (combined with other income tax cash flows) on the statement of cash flows rather than as a financing activity, and we adopted this change prospectively during the first quarter of 2016. ASU 2016-09 also requires the presentation of employee taxes as a financing activity on the statement of cash flows, which is where we had previously classified these items. This change, therefore, did not impact our financial statements. Non-Cash Compensation Expense. Compensation expense relating to all awards under the 2006 Plan and the 2016 Plan is included in SG&A and R&D. Non-cash compensation expense by type of award under LTI Programs was as follows for each period presented (in millions of dollars):
| Quarter Ended |  | Six Months Ended
| June 30, |  | June 30,
| 2016 |  | 2015 |  | 2016 |  | 2015
Non-vested common shares and restricted stock units | $ | 1.2 |  |  | $ | 1.1 |  |  | $ | 2.3 |  |  | $ | 2.2 |
EVA-Based Performance Shares | — |  |  | 0.3 |  |  | 0.3 |  |  | 0.7 |
TSR-Based Performance Shares | 1.4 |  |  | 1.0 |  |  | 2.5 |  |  | 1.7 |
CP-Based Performance Shares | 0.4 |  |  | — |  |  | 0.5 |  |  | — |
Total non-cash compensation expense | $ | 3.0 |  |  | $ | 2.4 |  |  | $ | 5.6 |  |  | $ | 4.6 |
The following table presents the allocation of the charges detailed above, by segment (in millions of dollars):
| Quarter Ended |  | Six Months Ended
| June 30, |  | June 30,
| 2016 |  | 2015 |  | 2016 |  | 2015
Fabricated Products | $ | 1.1 |  |  | $ | 0.9 |  |  | $ | 1.9 |  |  | $ | 1.6 |
All Other | 1.9 |  |  | 1.5 |  |  | 3.7 |  |  | 3.0 |
Total non-cash compensation expense | $ | 3.0 |  |  | $ | 2.4 |  |  | $ | 5.6 |  |  | $ | 4.6 |
Unrecognized Gross Compensation Cost Data. The following table presents unrecognized gross compensation cost data by type of award as of June 30, 2016:
| Unrecognized gross compensation costs (in millions of dollars) |  | Expected period (in years) over which the remaining gross compensation costs will be recognized
Non-vested common shares and restricted stock units | $ | 8.3 |  |  | 2.0
CP-Based Performance Shares | $ | 4.3 |  |  | 2.7
TSR-Based Performance Shares | $ | 9.1 |  |  | 2.0
Summary of Activity. A summary of the activity with respect to non-vested common shares, restricted stock units, EVA-Based Performance Shares, CP-Based Performance Shares and TSR-Based Performance Shares for the six months ended June 30, 2016 is as follows:
| Non-Vested Common Shares |  | Restricted Stock Units |  | EVA-Based Performance Shares |  | CP-Based Performance Shares |  | TSR-Based Performance Shares
| Shares |  | Weighted-Average Grant-Date Fair Value per Share |  | Units |  | Weighted-Average Grant-Date Fair Value per Unit |  | Shares |  | Weighted-Average Grant-Date Fair Value per Share |  | Shares |  | Weighted-Average Grant-Date Fair Value per Share |  | Shares |  | Weighted-Average Grant-Date Fair Value per Share
Outstanding at December 31, 2015 | 156,553 |  |  | $ | 67.20 |  |  | 5,521 |  |  | $ | 66.64 |  |  | 155,105 |  |  | $ | 57.76 |  |  | — |  |  | $ | — |  |  | 299,877 |  |  | $ | 89.43 |
Granted 1 | 9,702 |  |  | 86.11 |  |  | 57,205 |  |  | 75.57 |  |  | — |  |  | — |  |  | 63,983 |  |  | 80.46 |  |  | 95,974 |  |  | 93.02 |
Vested | (49,582 | ) |  | 65.53 |  |  | (2,048 | ) |  | 62.75 |  |  | (49,611 | ) |  | 57.76 |  |  | — |  |  | — |  |  | — |  |  | — |
Forfeited 1 | (282 | ) |  | 69.11 |  |  | (385 | ) |  | 74.49 |  |  | — |  |  | — |  |  | (164 | ) |  | 80.46 |  |  | (1,115 | ) |  | 90.06 |
Canceled 1 | — |  |  | — |  |  | — |  |  | — |  |  | (105,494 | ) |  | 57.76 |  |  | — |  |  | — |  |  | — |  |  | — |
Outstanding at June 30, 2016 | 116,391 |  |  | $ | 69.49 |  |  | 60,293 |  |  | $ | 75.20 |  |  | — |  |  | $ | — |  |  | 63,819 |  |  | $ | 80.46 |  |  | 394,736 |  |  | $ | 90.30 |
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1 | For EVA-Based Performance Shares, CP-Based Performance Shares and TSR-Based Performance Shares, the number of shares granted and forfeited are presented at their maximum payout; and the number of shares canceled includes the number of shares that did not vest due to EVA performance results falling below those required for maximum payout. Non-Vested Common Shares granted in 2016 were granted under the 2016 Plan.
The weighted-average grant-date fair value per share for shares granted by type of award was as follows for each period presented:
| Quarter Ended |  | Six Months Ended
| June 30, |  | June 30,
| 2016 |  | 2015 |  | 2016 |  | 2015
Non-vested common shares | $ | 86.11 |  |  | $ | 82.88 |  |  | $ | 86.11 |  |  | $ | 71.67 |
Restricted stock units | $ | 88.27 |  |  | $ | — |  |  | $ | 75.57 |  |  | $ | 69.83 |
CP-Based Performance Shares | $ | — |  |  | $ | — |  |  | $ | 80.46 |  |  | $ | — |
TSR-Based Performance Shares | $ | — |  |  | $ | — |  |  | $ | 93.02 |  |  | $ | 95.68 |
Stock Options. As of December 31, 2015, we had 16,645 fully-vested outstanding stock options exercisable to purchase common shares at $80.01 per share and having a remaining contractual life of 1.25 years. During the six months ended June 30, 2016, 12,768 options were exercised and no options were granted or forfeited, resulting in 3,877 fully-vested stock options outstanding as of June 30, 2016 with a remaining contractual life of 0.75 years. Vested Stock. From time to time, we issue common shares to non-employee directors electing to receive common shares in lieu of all or a portion of their annual retainer fees. The fair value of these common shares is based on the fair value of the shares at the date of issuance and is immediately recognized in Net income (loss) as a period expense. We recorded $0.1 million and $0.2 million during the six months ended June 30, 2016 and June 30, 2015, respectively, relating to common shares granted to non-employee directors in lieu of all or a portion of their annual retainer fees. Under the 2006 Plan and 2016 Plan, participants may elect to have us withhold common shares to satisfy minimum statutory tax withholding obligations arising in connection with the exercise of stock options and vesting of non-vested shares, restricted stock units and performance shares. We cancel any such shares withheld on the applicable vesting dates or earlier dates when service requirements are satisfied, which correspond to the times at which income to the employee is recognized. When we withhold these common shares, we are required to remit to the appropriate taxing authorities the fair value of the shares withheld as of the vesting date. During the six months ended June 30, 2016 and June 30, 2015, 35,430 and 34,969 common shares, respectively, were withheld and canceled for this purpose. The withholding of common shares by us could be deemed a purchase of the common shares.

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- 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://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 40 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6418621&loc=d3e17540-113929 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 50 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=51659978&loc=d3e25284-112666 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5070-113901 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5047-113901 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5444-113901 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Staff Accounting Bulletin (SAB) -Number Topic 14 + Details
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