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Common Stock and Preferred Stock
 9 Months Ended
Sep. 30, 2013
Common Stock and Preferred Stock

NOTE 3 – COMMON STOCK AND PREFERRED STOCK

Common Stock

The Company’s common stock trades under the symbol “UTL”.

The Company had 13,831,624, 13,769,376 and 13,780,601 of common shares outstanding at September 30, 2013, September 30, 2012 and December 31, 2012, respectively.

Unitil Corporation Common Stock Offering – On May 16, 2012, the Company issued and sold 2,760,000 shares of its common stock at a price of $25.25 per share in a registered public offering (Offering). The Company’s net increase to Common Equity and Cash proceeds from the Offering were approximately $65.7 million and were used to make equity capital contributions to the Company’s regulated utility subsidiaries, repay short-term debt and for general corporate purposes.

Dividend Reinvestment and Stock Purchase Plan – During the first nine months of 2013, the Company sold 29,783 shares of its common stock, at an average price of $28.73 per share, in connection with its Dividend Reinvestment and Stock Purchase Plan (DRP) and its 401(k) Plan resulting in net proceeds of approximately $856,000. The DRP provides participants in the plan a method for investing cash dividends on the Company’s common stock and cash payments in additional shares of the Company’s common stock.

 

Stock Plan – The Company maintains the Unitil Corporation Second Amended and Restated 2003 Stock Plan (the Stock Plan). Participants in the Stock Plan are selected by the Compensation Committee of the Board of Directors to receive awards under the Stock Plan, including awards of restricted shares (Restricted Shares), or of restricted stock units (Restricted Stock Units). The Compensation Committee has the authority to determine the sizes of awards; determine the terms and conditions of awards in a manner consistent with the Stock Plan; construe and interpret the Stock Plan and any agreement or instrument entered into under the Stock Plan as they apply to participants; establish, amend, or waive rules and regulations for the Stock Plan’s administration as they apply to participants; and, subject to the provisions of the Stock Plan, amend the terms and conditions of any outstanding award to the extent such terms and conditions are within the discretion of the Compensation Committee as provided for in the Stock Plan. On April 19, 2012, the Company’s shareholders approved an amendment to the Stock Plan to, among other things, increase the maximum number of shares of common stock available for awards to plan participants.

The maximum number of shares available for awards to participants under the Stock Plan is 677,500. The maximum number of shares that may be awarded in any one calendar year to any one participant is 20,000. In the event of any change in capitalization of the Company, the Compensation Committee is authorized to make an equitable adjustment to the number and kind of shares of common stock that may be delivered under the Stock Plan and, in addition, may authorize and make an equitable adjustment to the Stock Plan’s annual individual award limit.

Restricted Shares

Outstanding awards of Restricted Shares fully vest over a period of four years at a rate of 25% each year. During the vesting period, dividends on Restricted Shares underlying the award may be credited to a participant’s account. Awards may be grossed up to offset the participant’s tax obligations in connection with the award. Prior to the end of the vesting period, the restricted shares are subject to forfeiture if the participant ceases to be employed by the Company other than due to the participant’s death.

On February 4, 2013, 21,240 Restricted Shares were issued in conjunction with the Stock Plan with an aggregate market value at the date of issuance of $564,134. There were 53,480 and 53,942 non-vested shares under the Stock Plan as of September 30, 2013 and 2012, respectively. The weighted average grant date fair value of these shares was $25.99 and $24.67, respectively. The compensation expense associated with the issuance of shares under the Stock Plan is being recognized over the vesting period and was $0.6 million and $1.1 million for the nine months ended September 30, 2013 and 2012, respectively. At September 30, 2013, there was approximately $0.8 million of total unrecognized compensation cost under the Stock Plan which is expected to be recognized over approximately 2.6 years. There were no forfeitures or cancellations under the Stock Plan during the nine months ended September 30, 2013.

 

Restricted Stock Units

Restricted Stock Units earn dividend equivalents and will generally be settled by payment to each Director as soon as practicable following the Director’s separation from service to the Company. The Restricted Stock Units will be paid such that the Director will receive (i) 70% of the shares of the Company’s common stock underlying the restricted stock units and (ii) cash in an amount equal to the fair market value of 30% of the shares of the Company’s common stock underlying the Restricted Stock Units. The equity portion of Restricted Stock Units activity during the nine months ended September 30, 2013 in conjunction with the Stock Plan are presented in the following table:

 

Restricted Stock Units (Equity Portion)

  
     Units      Weighted
Average
Stock
Price		  

Restricted Stock Units as of December 31, 2012

      3,883       $ 27.39   

Restricted Stock Units Granted

      —           —     

Dividend Equivalents Earned

      141       $ 28.72   

Restricted Stock Units Settled

      —           —     
  

 

 

     

Restricted Stock Units as of September 30, 2013

      4,024       $ 27.44   
  

 

 

     

There were no Restricted Stock Units outstanding as of September 30, 2012. On October 1, 2013 there were 15,300 fully-vested Restricted Stock Units issued to members of the Company’s Board of Directors. The fair value of liabilities associated with the cash portion of fully-vested Restricted Stock Units is approximately $0.1 million, zero and approximately $0.1 million as of September 30, 2013, September 30, 2012 and December 31, 2012, respectively, and is included in Other Noncurrent Liabilities on the Company’s Consolidated Balance Sheets.

Preferred Stock

Details on preferred stock at September 30, 2013, September 30, 2012 and December 31, 2012 are shown below:

 

     September 30,      December 31,  
     2013      2012      2012  

Preferred Stock

         

Unitil Energy Preferred Stock, Non-Redeemable, Non-Cumulative:

         

6.00% Series, $100 Par Value,

    $ 0.2       $ 0.2       $ 0.2   

Fitchburg Preferred Stock, Redeemable, Cumulative:

         

5.125% Series, $100 Par Value

      —           0.8         —     

8.00% Series, $100 Par Value

      —           1.0         —     
  

 

 

     

 

 

     

 

 

  

Total Preferred Stock

    $ 0.2       $ 2.0       $ 0.2   
  

 

 

     

 

 

     

 

 

  

There were 2,250 shares of Unitil Energy’s 6.00% Series Preferred Stock outstanding at September 30, 2013, September 30, 2012 and December 31, 2012.

There were 7,823 shares of Fitchburg’s 5.125% Series Preferred Stock and 9,654 shares of Fitchburg’s 8.00% Series Preferred Stock outstanding at September 30, 2012. On December 1, 2012, Fitchburg redeemed and retired the two outstanding issues of its Redeemable, Cumulative Preferred Stock. The 8.00% Series was redeemed at par (aggregate par value of $965,400). The 5.125% Series was redeemed at par plus a premium of 1.28% (aggregate value of $792,313). Fitchburg used operating cash to effect this transaction.

There were less than $0.1 million of total dividends declared on Preferred Stock in each of the three and nine month periods ended September 30, 2013 and in the three months ended September 30, 2012. There were $0.1 million of total dividends declared on Preferred Stock in the nine months ended September 30, 2012.