XML 45 R17.htm IDEA: XBRL DOCUMENT
v3.19.3.a.u2

Share-Based Compensation | 12 Months Ended
--- | ---
Dec. 31, 2019
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] |
Share-Based Compensation | Note H - Share-Based Compensation The 1999 Stock Option Plan Activity in the Company’s 1999 Stock Option Plan for the year ended December 31, 2019 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, 2019 |  |  | 750 |  |  | $ | 39.10 |  |  |  |  |  |  |  |  |
Exercised |  |  | (750 | ) |  | $ | 39.10 |  |  |  |  |  |  |  |  |
Forfeited |  |  | 0 |  |  | $ | 0.00 |  |  |  |  |  |  |  |  |
Outstanding (exercisable and vested) at December 31, 2019 |  |  | 0 |  |  | $ | 0.00 |  |  |  | 0.0 |  |  | $ | 0 |
There were 750, 0 and 4,800 in stock options exercised during the years ended December 31, 2019, 2018 and 2017, respectively. The total intrinsic value of stock options exercised during the year ended December 31, 2019 was approximately $.1 million. Less than $.1 million in cash was received for the exercise of stock options during 2019. The Company recorded no compensation expense related to these stock options for the years ended December 31, 2019, 2018 and 2017, as all options were fully vested as of December 31, 2012. Long Term Incentive Plan of 2008 and 2016 Incentive Plan The Company maintains an equity award program 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. Under the Preformed Line Products Company Long Term Incentive Plan of 2008 (the “LTIP”), certain employees, officers, and directors were eligible to receive awards of options, restricted shares and restricted share units (RSUs). The total number of Company common shares reserved for awards under the LTIP was 900,000, of which 800,000 common shares were reserved for RSUs and 100,000 common shares were reserved for share options. The Preformed Line Products Company 2016 Incentive Plan (the “Incentive Plan”) was put in place upon approval by the Company’s Shareholders at the 2016 Annual Meeting of Shareholders on May 10, 2016. No further awards will be made under the LTIP and previously granted awards remain outstanding in accordance with their terms. Under the Incentive Plan, certain employees, officers, and directors will be eligible to receive awards of options, restricted shares and RSUs. The total number of Company common shares reserved for awards under the Incentive Plan is 1,000,000 of which 900,000 common shares have been reserved for restricted share awards and 100,000 common shares have been reserved for share options. As of December 31, 2019, 15,000 options and 235,599 restricted shares have been granted under the Incentive Plan. The Incentive Plan expires on May 10, 2026. Restricted Share Units For the regular annual grants, a portion of the RSUs is subject to time-based cliff vesting and a portion is subject to vesting based upon the Company’s performance over a set period for all participants except the CEO. All of the CEO’s regular annual RSUs are subject to vesting based upon the Company’s performance over a set-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. Dividends declared are accrued. A summary of the RSUs for the year ended December 31, 2019 is as follows:
|  | Restricted Share Awards |
|  | Performance |  |  |  |  |  |  | Total |  |  | Weighted-Average |
|  | and Service |  |  | Service |  |  | Restricted |  |  | Grant-Date |
|  | Required |  |  | Required |  |  | Awards |  |  | Fair Value |
Nonvested as of January 1, 2019 |  |  | 213,624 |  |  |  | 17,298 |  |  |  | 230,922 |  |  | $ | 53.68 |
Granted |  |  | 65,392 |  |  |  | 8,123 |  |  |  | 73,515 |  |  |  | 56.22 |
Vested |  |  | (75,921 | ) |  |  | (9,061 | ) |  |  | (84,982 | ) |  |  | 36.03 |
Forfeited |  |  | (6,753 | ) |  |  | (1,068 | ) |  |  | (7,821 | ) |  |  | 68.95 |
Nonvested as of December 31, 2019 |  |  | 196,342 |  |  |  | 15,292 |  |  |  | 211,634 |  |  | $ | 53.68 |
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 Statements of Consolidated Income. Annual compensation expense related to the time-based RSUs for the years ended December 31, 2019, 2018 and 2017 was $.5 million, $.5 million and $.4 million, respectively. During the year ended December 31, 2019, retired Officers of the Company forfeited 1,068 RSUs granted during 2018 and 2017. As of December 31, 2019, 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 1.6 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 pre-tax income and sales growth over a requisite performance period. Depending on the extent to which the performance criteria are satisfied under the LTIP, the participants are eligible to earn common shares over the vesting period. Performance-based compensation expense for the years ended December 31, 2019, 2018 and 2017 was $3.9 million, $3.7 million and $2.7 million, respectively. During the year ended December 31, 2019, Company participants and retired Officers of the Company forfeited 6,753 RSUs granted during 2018 and 2017. As of December 31, 2019, the remaining performance-based RSUs compensation expense of $3.9 million is expected to be recognized over a period of approximately 1.6 years. The excess tax benefits from service and performance-based RSUs was $.5 million, $.2 million and $.2 million for the years ended December 31, 2019, 2018 and 2017, respectively. This represents the reduction in income taxes otherwise payable during the period attributable to the actual gross tax benefits in excess of the expected tax benefits for restricted shares vested in the current period. In the event of a Change in Control (as defined in the LTIP and Incentive Plan), vesting of the RSUs will be accelerated and all restrictions will lapse. Nonvested performance-based awards are based on a maximum target 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 RSUs, the Company has reserved new shares from its authorized but unissued shares. Any additional granted awards will also be issued from the Company’s authorized but unissued shares. 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 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 December 31, 2019, 267,641 LTIP shares have been deferred and are being held by the rabbi trust. Share Option Awards The LTIP permitted and now the Incentive 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. Options issued to date under the LTIP and Incentive 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 5,000 options granted during each of the years ended December 31, 2019, 2018 and 2017. The fair values for the stock options granted were estimated at the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions:
| 2019 |  |  | 2018 |  |  | 2017 |
Risk-free interest rate |  | 1.8 | % |  |  | 2.8 | % |  |  | 2.0 | %
Dividend yield |  | 1.6 | % |  |  | 1.6 | % |  |  | 1.7 | %
Expected life (years) | 5 |  |  | 5 |  |  | 5 |
Expected volatility |  | 42.0 | % |  |  | 40.0 | % |  |  | 36.8 | %
Activity in the Company’s LTIP and Incentive Plan for the year ended December 31, 2019 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, 2019 |  |  | 30,750 |  |  | $ | 56.81 |  |  |  |  |  |  |  |  |
Granted |  |  | 5,000 |  |  | $ | 60.60 |  |  |  |  |  |  |  |  |
Exercised |  |  | (4,000 | ) |  | $ | 45.96 |  |  |  |  |  |  |  |  |
Forfeited |  |  | 0 |  |  | $ | 0.00 |  |  |  |  |  |  |  |  |
Outstanding (vested and expected to vest) at December 31, 2019 |  |  | 31,750 |  |  | $ | 58.77 |  |  |  | 6.6 |  |  | $ | 169 |
Exercisable at December 31, 2019 |  |  | 23,000 |  |  | $ | 58.68 |  |  |  | 5.6 |  |  | $ | 154 |
The weighted-average grant-date fair value of options granted during 2019 was $60.60. There were 4,000, 3,500, and 28,500 stock options exercised during the years ended December 31, 2019, 2018 and 2017, respectively. The total intrinsic value of stock options exercised was $.1 million, $.1 million and $.7 for the years ended December 31, 2019, 2018 and 2017, respectively. Cash received for the exercise of stock options during 2019 was $.2 million, $.2 million in 2018 and $1.5 million in 2017. For each of the three years ended December 31, 2019, 2018 and 2017, the Company recorded compensation expense related to the stock options currently vested of less than $.1 million. The total compensation cost related to nonvested awards not yet recognized at December 31, 2019 is expected to be $.2 million over a weighted-average period of approximately 2.5 years. The excess tax benefits from share-based awards for each of the years ended December 31, 2019, 2018 and 2017 was less than $.1 million. This represents the reduction in income taxes otherwise payable during the period attributable to the actual gross tax benefits in excess of the expected tax benefits for options exercised in the current period.

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_DisclosureOfCompensationRelatedCostsSharebasedPaymentsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration