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Stockholders' Equity | 9 Months Ended
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Sep. 30, 2023
Share-Based Payment Arrangement [Abstract] |
STOCKHOLDERS' EQUITY | STOCKHOLDERS’ EQUITY Restricted Stock Restricted stock activity is as follows (in thousands, except shares):
| Three months ended September 30, |  | Nine months ended September 30,
| 2022 |  | 2023 |  | 2022 |  | 2023
| Shares | Fair Value |  | Shares | Fair Value |  | Shares | Fair Value |  | Shares | Fair Value
Granted(1) | — |  | $ | — |  |  | — |  | $ | — |  |  | — |  | $ | — |  |  | 142,020 |  | $ | 4,634 |
Returned for payroll taxes | — |  | $ | — |  |  | — |  | $ | — |  |  | 4,136 |  | $ | 205 |  |  | 1,473 |  | $ | 50 |
Cancelled | 500 |  | $ | 16 |  |  | — |  | $ | — |  |  | 1,950 |  | $ | 63 |  |  | 1,826 |  | $ | 61 |
(1) | Restricted stock granted during the nine months ended September 30 2023 vests over a three-year period, if the employee has remained continuously employed by us during the vesting period, at a weighted average stock price of $32.63.
We recorded stock-based compensation expense, which is included in General, administrative and other expenses, for restricted stock awards of $36,000 and $400,000, for the three months ended September 30, 2022 and 2023, respectively and $133,000 and $972,000 for the nine months ended September 30, 2022 and 2023, respectively. Stock Options Stock option grants and cancellations are as follows (in thousands, except shares):
| Three months ended September 30, |  | Nine months ended September 30,
| 2022 |  | 2023 |  | 2022 |  | 2023
| Shares | Fair Value |  | Shares | Fair Value |  | Shares | Fair Value |  | Shares | Fair Value
Granted(1) | — |  | $ | — |  |  | — |  | $ | — |  |  | 58,500 |  | $ | 959 |  |  | 214,191 |  | $ | 2,506 |
Granted(2) | — |  | $ | — |  |  | — |  | $ | — |  |  | 310,000 |  | $ | 5,388 |  |  | — |  | $ | — |
Granted(3) | 12,600 |  | $ | 143 |  |  | — |  | $ | — |  |  | 12,600 |  | $ | 143 |  |  | — |  | $ | — |
Cancelled | 3,652 |  | $ | 37 |  |  | 1,700 |  | $ | 20 |  |  | 28,790 |  | $ | 322 |  |  | 103,550 |  | $ | 1,354 |
(1) | Stock options granted during the nine months ended September 30, 2022 and 2023 had a weighted average price of $49.48 and $32.69, respectively. The fair value of these options was calculated using the Black-Scholes option pricing model. The options granted in 2022 vest over a five-year period and have a ten-year term. The options granted in 2023 vest over a three-year period and have a ten-year term. These options will vest if the employee has remained continuously employed by us through the vesting period.
(2) | Stock options granted during the nine months ended September 30, 2022 had a weighted average price of $49.48. The fair value of these options was calculated using the Black-Scholes option pricing model and vest over a seven-year period and have a ten-year term. These options will vest if the employee has remained continuously employed by us through the vesting period.
(3) | Stock options granted during the three and nine months ended September 30, 2022 had a weighted average price of $31.58. The fair value of these options was calculated using the Black-Scholes option pricing model and vest over a three-year period and have a ten-year term. These options will vest if the employee has remained continuously employed by us through the vesting period.
The fair value of the options granted during the nine months ended September 30, 2023 was estimated using the Black-Scholes option pricing model with the following assumptions:
Grant Date |  |  |  | February 22, 2023
Expected holding period (years) |  |  |  | 4.00
Awards granted |  |  |  | 214,191
Dividend yield |  |  |  | 1.38%
Expected volatility |  |  |  | 43.68%
Risk-free interest rate |  |  |  | 4.27%
Black-Scholes value |  |  |  | $11.70
Additional stock option activity is as follows (in thousands, except shares):
| Three months ended September 30, |  | Nine months ended September 30,
| 2022 |  | 2023 |  | 2022 |  | 2023
| Shares | Cash |  | Shares | Cash |  | Shares | Cash |  | Shares | Cash
Exercised(1) | — |  | N/A |  | 44,900 |  | N/A |  | 18,736 |  | N/A |  | 74,200 |  | N/A
Returned for option price(2) | — |  | $ | — |  |  | 34,160 |  | $ | — |  |  | 8,125 |  | $ | 60 |  |  | 56,957 |  | $ | — |
Returned for payroll taxes(3) | — |  | $ | — |  |  | 4,021 |  | $ | 133 |  |  | 1,601 |  | $ | 82 |  |  | 5,486 |  | $ | 174 |
(1) | Stock options exercised during the three months ended September 30, 2023 had a weighted average exercise price of $25.1 with an aggregate intrinsic value of $0.4 million. Stock options exercised during the nine months ended September 30, 2022 and 2023 had a weighted average exercise price of $25.88 and $23.98, respectively, with an aggregate intrinsic value of $0.5 million and $0.5 million, respectively.
(2) | Represents shares withheld/cash received for the payment of the option price.
(3) | Represents shares withheld/cash paid for the payment of payroll taxes.
We recorded stock-based compensation expense, which is included in General, administrative and other expenses, for stock options of $559,000 and $735,000, for the three months ended September 30, 2022 and 2023, respectively and $1,747,000 and $2,180,000 for the nine months ended September 30, 2022 and 2023, respectively. Performance Awards Performance award activity is as follows (in thousands, except shares):
| Three months ended September 30, |  | Nine months ended September 30,
| 2022 |  | 2023 |  | 2022 |  | 2023
| Shares | Fair Value |  | Shares | Fair Value |  | Shares | Fair Value |  | Shares | Fair Value
Granted | — |  | $ | — |  |  | — |  | $ | — |  |  | 27,013 |  | $ | 1,262 |  |  | — |  | $ | — |
Cancelled | — |  | $ | — |  |  | — |  | $ | — |  |  | 20,961 |  | $ | 201 |  |  | 40,181 |  | $ | 1,012 |
We recorded stock-based compensation expense, which is included in General, administrative and other expenses, for performance awards of $701,000 and $622,000 for the three months ended September 30, 2022 and 2023, respectively and $1,904,000 and $1,350,000 for the nine months ended September 30, 2022 and 2023, respectively. Employee Stock Purchase Plan ESPP activity is as follows (in thousands, except shares):
| Three months ended September 30, |  | Nine months ended September 30,
| 2022 |  | 2023 |  | 2022 |  | 2023
| Shares | Price |  | Shares | Price |  | Shares | Price |  | Shares | Price
ESPP | 13,795 |  | $ | 27.34 |  |  | 11,782 |  | $ | 24.01 |  |  | 38,884 |  | $ | 35.42 |  |  | 49,824 |  | $ | 24.21 |
The fair value of the right (option) to purchase shares under the ESPP is estimated at the date of purchase with the four quarterly purchase dates using the following assumptions:
| 2023
Dividend yield | 1.30%
Expected volatility | 53.51%
Risk-free interest rate | 4.53%, 4.77%, 4.75%, 4.72%
Expected life (years) | 0.25, 0.50, 0.75, 1.00
We recorded stock-based compensation expense, which is included in General, administrative and other expenses and Regional and unallocated funeral and cemetery costs, for the ESPP totaling $120,000 and $74,000 for the three months ended September 30, 2022 and 2023, respectively and $471,000 and $489,000 for the nine months ended September 30, 2022 and 2023, respectively. Common Stock Former Employee Common stock activity is as follows (in thousands, except shares):
| Three months ended September 30, |  | Nine months ended September 30,
| 2022 |  | 2023 |  | 2022 |  | 2023
| Shares | Fair Value |  | Shares | Fair Value |  | Shares | Fair Value |  | Shares | Fair Value
Granted(1) | — |  | $ | — |  |  | — |  | $ | — |  |  | — |  | $ | — |  |  | 30,000 |  | $ | 826 |
Returned for payroll taxes | — |  | $ | — |  |  | — |  | $ | — |  |  | — |  | $ | — |  |  | 1,001 |  | $ | 28 |
(1) | During the nine months ended September 30, 2023, we issued 30,000 shares of common stock to a former executive at a stock price of $27.54, in accordance with his Separation and Release agreement pertaining to his resignation from his position as the Company’s Executive Vice President, Chief Financial Officer & Treasurer effective January 2, 2023.
We recorded stock-based compensation expense, which is included in General, administrative and other expenses, for common stock awards of $826,000, for the nine months ended September 30, 2023. Good To Great Incentive Program During the nine months ended September 30, 2023, we issued 8,444 shares of our common stock to certain employees, which were valued at $0.3 million at a grant date stock price of $32.69. During the nine months ended September 30, 2022, we issued 27,448 shares of our common stock to certain employees, which were valued at $1.4 million at a grant date stock price of $49.48. Non-Employee Director and Board Advisor Compensation Non-Employee Director and Board Advisor common stock activity is as follows (in thousands, except shares):
| Three months ended September 30, |  | Nine months ended September 30,
| 2022 |  | 2023 |  | 2022 |  | 2023
| Shares | Fair Value |  | Shares | Fair Value |  | Shares | Fair Value |  | Shares | Fair Value
Board of Directors(1) | 2,214 |  | $ | 71 |  |  | 3,747 |  | $ | 106 |  |  | 7,255 |  | $ | 307 |  |  | 8,342 |  | $ | 248 |
Advisor to the Board(1) | 155 |  | $ | 5 |  |  | 176 |  | $ | 5 |  |  | 374 |  | $ | 15 |  |  | 492 |  | $ | 15 |
(1) | Common stock granted during the three months ended September 30, 2022 and 2023 had a weighted average price of $32.16 and $28.25, respectively and $42.20 and $29.78 for nine months ended September 30, 2022 and 2023, respectively.
On July 5, 2023, our Board of Directors (the “Board”) elected Somer Webb to serve as a Class I Director until our 2024 annual meeting of shareholders. Ms. Webb was appointed to serve as the Chair of the Compensation Committee and a member of the Audit and Corporate Governance Committees. Concurrently with her appointment, the Board granted Ms. Webb 769 shares of our common stock under our Director Compensation Policy, which were valued at approximately $25,000 based on the closing price of our common stock on the grant date. On July 25, 2023, the Board elected Julie Sanders to serve as a Class II Director until our 2025 annual meeting of shareholders. Ms. Sanders was appointed to serve as a member of the Corporate Governance, Audit and Compensation Committees. Concurrently with her appointment, the Board granted Ms. Sanders 743 shares of our common stock under our Director Compensation Policy, which were valued at approximately $25,000 based on the closing price of our common stock on the grant date. We recorded compensation expense, which is included in General, administrative and other expenses, related to annual retainers, including the value of stock granted to non-employee Directors and an advisor to our Board, of $167,000 and $250,000 for the three months ended September 30, 2022 and 2023, respectively and $552,000 and $605,000 for the nine months ended September 30, 2022 and 2023, respectively. Share Repurchase Share repurchase activity is as follows (dollar value in thousands):
| Three months ended September 30, |  | Nine months ended September 30,
| 2022 |  | 2023 |  | 2022 |  | 2023 |  |
Number of Shares Repurchased | — |  |  | — |  |  | 695,496 |  |  | — |  |  |
Average Price Paid Per Share | $ | — |  |  | $ | — |  |  | $ | 49.22 |  |  | $ | — |  |  |
Dollar Value of Shares Repurchased | $ | — |  |  | $ | — |  |  | $ | 34,234 |  |  | $ | — |  |  |
Our shares were purchased in the open market at times and in amounts as management determined appropriate based on factors such as market conditions, legal requirements and other business considerations. Shares purchased pursuant to the repurchase program are currently held as treasury stock. At September 30, 2023, our share repurchase program had $48.9 million authorized for repurchases. Cash Dividend Our Board declared the following dividends payable on the dates below (in thousands, except per share amounts):
2023 | Per Share |  | Dollar Value
March 1 st | $ | 0.1125 |  |  | $ | 1,661 |
June 1 st | $ | 0.1125 |  |  | $ | 1,679 |
September 1 st | $ | 0.1125 |  |  | $ | 1,683 |
2022 | Per Share |  | Dollar Value
March 1 st | $ | 0.1125 |  |  | $ | 1,725 |
June 1 st | $ | 0.1125 |  |  | $ | 1,730 |
September 1 st | $ | 0.1125 |  |  | $ | 1,653 |

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