XML 55 R14.htm IDEA: XBRL DOCUMENT
v2.4.0.8

SHARE-BASED COMPENSATION | 6 Months Ended
--- | ---
Jun. 30, 2014
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] |
SHARE-BASED COMPENSATION | NOTE G – SHARE-BASED COMPENSATION The 1999 Stock Option Plan Activity in the Company’s 1999 Stock Option Plan for the six month period ended June 30, 2014 was as follows:
|  | Number of Shares |  |  | Weighted Average Exercise Price per Share |  |  | Weighted Average Remaining Contractual Term (Years) |  |  | Aggregate Intrinsic Value |
Outstanding at January 1, 2014 |  |  | 13,000 |  |  | $ | 39.95 |  |  |  |  |  |  |  |  |
Granted |  |  | 0 |  |  | $ | 0.00 |  |  |  |  |  |  |  |  |
Exercised |  |  | (900 | ) |  | $ | 22.10 |  |  |  |  |  |  |  |  |
Forfeited |  |  | 0 |  |  | $ | 0.00 |  |  |  |  |  |  |  |  |
Outstanding (exercisable and vested) at June 30, 2014 |  |  | 12,100 |  |  | $ | 41.28 |  |  |  | 3.3 |  |  | $ | 152 |
There were 900 and 10,900 stock options exercised during the six month periods ended June 30, 2014 and 2013, respectively. The total intrinsic value of stock options exercised during the six month periods ended June 30, 2014 and 2013 was less than $.1 million and $.3 million, respectively. Cash received for the exercise of stock options during the six month periods ended June 30, 2014 and 2013 was less than $.1 million and $.5 million, respectively. Excess tax benefits from share-based awards for the six month periods ended June 30, 2014 and 2013 were $0 and $.1 million, respectively. For the six month periods ended June 30, 2014 and 2013, the Company recorded no compensation expense related to stock options for either period as all options are fully vested. Long Term Incentive Plan of 2008 Under the Preformed Line Products Company Long Term Incentive Plan of 2008 (the “LTIP”), certain employees, officers, and directors are eligible to receive awards of options, restricted shares and restricted share units. The purpose of this LTIP is to give the Company a competitive advantage in attracting, retaining, and motivating officers, employees and directors and to provide an incentive to those individuals to increase shareholder value through long-term incentives directly linked to the Company’s performance. The total number of Company common shares reserved for awards under the LTIP is 900,000. Of the 900,000 common shares, 800,000 common shares have been reserved for restricted share units and 100,000 common shares have been reserved for stock options. The LTIP expires on April 17, 2018. Restricted Share Units For all of the participants except the CEO, a portion of the restricted share units (RSUs) is subject to time-based cliff vesting and a portion is subject to vesting based upon the Company’s performance over a three year period. All of the CEO’s RSUs are subject to vesting based upon the Company’s performance over a three year period. The RSUs are offered at no cost to the employees; however, the participant must remain employed with the Company until the restrictions on the RSUs lapse. The fair value of RSUs is based on the market price of a common share on the grant date. The Company currently estimates that no RSUs will be forfeited. Dividends declared are accrued in cash. A summary of the RSUs for the six month period ended June 30, 2014 is as follows:
|  | Restricted Share Units |
|  | Performance |  |  |  |  |  | Total |  |  | Weighted-Average |
|  | and Service |  |  | Service |  |  | Restricted |  |  | Grant-Date |
|  | Required |  |  | Required |  |  | Share Units |  |  | Fair Value |
Nonvested as of January 1, 2014 |  |  | 89,459 |  |  |  | 10,202 |  |  |  | 99,661 |  |  | $ | 65.86 |
Granted |  |  | 40,676 |  |  |  | 4,799 |  |  |  | 45,475 |  |  |  | 63.95 |
Vested |  |  | 0 |  |  |  | 0 |  |  |  | 0 |  |  |  | 0.00 |
Forfeited |  |  | 0 |  |  |  | 0 |  |  |  | 0 |  |  |  | 0.00 |
Nonvested as of June 30, 2014 |  |  | 130,135 |  |  |  | 15,001 |  |  |  | 145,136 |  |  | $ | 65.26 |
For time-based RSUs, the Company recognizes stock-based compensation expense on a straight-line basis over the requisite service period of the award in General and administrative expense in the accompanying Statement of Consolidated Income. Compensation expense related to the time-based RSUs for the three and six month periods ended June 30, 2014 was $.1 million and $.2 million, respectively. Compensation expense related to the time-based RSUs for the three and six month periods ended June 30, 2013 was $.1 million for each period. As of June 30, 2014, there was $.5 million of total unrecognized compensation cost related to time-based RSUs that is expected to be recognized over the weighted-average remaining period of approximately 1.9 years. For the performance-based RSUs, the number of RSUs in which the participants will vest depends on the Company’s level of performance measured by growth in pretax income and sales growth over a requisite performance period. Depending on the extent to which the performance criterions are probable of being satisfied under the LTIP, the participants are eligible to earn common shares over the vesting period. Performance-based compensation expense for the three month period ended June 30, 2014 was income of $.1 million. The performance-based compensation expense for the six month period ended June 30, 2014 was $.4 million. During the three month period ended June 30, 2014, a $.9 million reduction in performance-based compensation expense was recorded related to the 2013 performance-based RSU grant, due to changes in estimates for growth in pretax income. Performance-based compensation expense for the three and six month periods ended June 30, 2013 was $.8 million and $1.3 million, respectively. As of June 30, 2014, the remaining performance-based RSUs compensation expense of $3.5 million is expected to be recognized over a period of approximately 2 years. The excess tax benefits from RSUs for the six month periods ended June 30, 2014 and 2013 was $.2 million and $0, respectively. In the event of a Change in Control (as defined in the LTIP), vesting of the RSUs will be accelerated and all restrictions will lapse. Unvested performance-based awards are based on a maximum potential payout. Actual shares awarded at the end of the performance period may be less than the maximum potential payout level depending on achievement of performance-based award objectives. To satisfy the vesting of its RSU awards, the Company has issued new shares from its authorized but unissued shares. Any additional granted awards will also be issued from the Company’s authorized but unissued shares. Under the LTIP, there are 384,398 common shares currently available for additional RSU grants. Deferred Compensation Plan The Company maintains a trust, commonly referred to as a rabbi trust, in connection with the Company’s deferred compensation plan. This plan allows for two deferrals. First, Directors make elective deferrals of Director fees payable and held in the rabbi trust. The deferred compensation plan allows the Directors to elect to receive Director fees in common shares of the Company at a later date instead of fees paid each quarter in cash. Second, this plan allows certain Company employees to defer LTIP restricted shares or RSUs for future distribution in the form of common shares. Assets of the rabbi trust are consolidated, and the value of the Company’s stock held in the rabbi trust is classified in Shareholders’ equity and generally accounted for in a manner similar to treasury stock. The Company recognizes the original amount of the deferred compensation (fair value of the deferred stock award at the date of grant) as the basis for recognition in common shares issued to the rabbi trust. Changes in the fair value of amounts owed to certain employees or Directors are not recognized as the Company’s deferred compensation plan does not permit diversification and must be settled by the delivery of a fixed number of the Company’s common shares. As of June 30, 2014, 249,557 shares have been deferred and are being held by the rabbi trust. Share Option Awards The LTIP plan permits the grant of 100,000 options to buy common shares of the Company to certain employees at not less than fair market value of the shares on the date of grant. At June 30, 2014 there were 40,000 shares remaining available for issuance under the LTIP. Options issued to date under the Plan vest 50% after one year following the date of the grant, 75% after two years, and 100% after three years and expire from five to ten years from the date of grant. Shares issued as a result of stock option exercises will be funded with the issuance of new shares. The Company utilizes the Black-Scholes option pricing model for estimating fair values of options. The Black-Scholes model requires assumptions regarding the volatility of the Company’s stock, the expected life of the stock award and the Company’s dividend yield. The Company utilizes historical data in determining these assumptions. The risk-free rate for periods within the contractual life of the option is based on the U.S. zero coupon Treasury yield in effect at the time of grant. Forfeitures have been estimated to be zero. There were 17,000 and 0 options granted for the six month periods ended June 30, 2014 and 2013. The fair value for the stock options granted in 2014 was estimated at the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions:
|  | 2014 |
Risk-free interest rate |  |  | 1.7 | %
Dividend yield |  |  | 1.7 | %
Expected life (years) |  |  | 5 |
Expected volatility |  |  | 45.8 | %
Activity in the Company’s LTIP plan for the six month period ended June 30, 2014 was as follows:
|  | Number of Shares |  |  | Weighted Average Exercise Price per Share |  |  | Weighted Average Remaining Contractual Term (Years) |  |  | Aggregate Intrinsic Value |
Outstanding at January 1, 2014 |  |  | 17,000 |  |  | $ | 54.20 |  |  |  |  |  |  |  |  |
Granted |  |  | 17,000 |  |  | $ | 71.62 |  |  |  |  |  |  |  |  |
Exercised |  |  | (1,250 | ) |  | $ | 52.10 |  |  |  |  |  |  |  |  |
Forfeited |  |  | 0 |  |  | $ | 0.00 |  |  |  |  |  |  |  |  |
Outstanding (vested and expected to vest) at June 30, 2014 |  |  | 32,750 |  |  | $ | 63.32 |  |  |  | 8.6 |  |  | $ | 15 |
Exercisable at June 30, 2014 |  |  | 11,375 |  |  | $ | 54.30 |  |  |  | 7.6 |  |  | $ | 11 |
The weighted-average grant-date fair value of options granted during 2014 was $25.79. There were 1,250 and 9,250 stock options exercised during the six month periods ended June 30, 2014 and 2013, respectively. The total intrinsic value of stock options exercised during the six month periods ended June 30, 2014 and 2013 was less than $.1 million and $.3 million, respectively. Cash received for the exercise of stock options during the six month periods ended June 30, 2014 and 2013 was $.1 million and $.4 million, respectively. For the three and six month periods ended June 30, 2014, the Company recorded compensation expense related to the stock options currently vesting of $.1 million and $.2 million, respectively. For the three and six month periods ended June 30, 2013, the Company recorded compensation expense related to the stock options currently vesting of less than $.1 million for each period. The total compensation cost related to nonvested awards not yet recognized at June 30, 2014 is expected to be a combined total of $.4 million over a weighted-average period of approximately 2.2 years.

X
- Details
Name: | us-gaap_DisclosureOfCompensationRelatedCostsSharebasedPaymentsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

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://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 2: 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 3: 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=6406099&loc=d3e25284-112666 Reference 4: 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 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
Name: | us-gaap_DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration