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Note 12 - Share-based Compensation

12 Months Ended

Dec. 31, 2021

Share-based Payment Arrangement [Text Block]

12.

SHARE-BASED COMPENSATION:

The Company has one active stock incentive plan for employees and directors, the 2007 Stock Incentive Plan, which provides for awards of stock options to purchase shares of common stock, stock appreciation rights, restricted and unrestricted shares of common stock, RSUs, and PSAs.

The following table summarizes share-based compensation expense recorded (in thousands):

	Year Ended December 31,
	2021		2020		2019

Cost of sales	$	1,003	$	822	$	383
Selling, general, and administrative expense		2,213		2,266		1,326
Total	$	3,216	$	3,088	$	1,709

There were 222,022 shares of common stock available for future issuance under the Company’s stock incentive plan as of December 31, 2021, assuming the outstanding PSAs vest at the target level of 100%.

Stock Options Awards

The Company’s stock incentive plan provides that options become exercisable according to vesting schedules and terminate according to the terms of the grant. There were no options granted during the years ended December 31, 2021, 2020, or 2019. During the year ended December 31, 2020, 24,000 stock options at a weighted-average exercise price of $24.15 were exercised. The total intrinsic value of options exercised during the year ended December 31, 2020 was $0.1 million. There were no options exercised during the years ended December 31, 2021 or 2019. As of December 31, 2021 and 2020, there were no stock options outstanding.

Restricted Stock Units and Performance Share Awards

The Company’s stock incentive plan provides for equity instruments, such as RSUs and PSAs, which grant the right to receive a specified number of shares over a specified period of time. RSUs and PSAs are service-based awards that vest according to the terms of the grant. PSAs have performance-based payout conditions.

The following table summarizes the Company’s RSU and PSA activity:

	Number of RSUs and PSAs (1)			Weighted-Average Grant Date Fair Value

Unvested RSUs and PSAs as of December 31, 2020		129,572		$	25.86
RSUs and PSAs granted		90,368			33.30
RSUs and PSAs vested (2)		(58,809	)		25.53
Unvested RSUs and PSAs as of December 31, 2021		161,131			30.26

(1)

The number of PSAs disclosed in this table are at the target level of 100%.

(2)

For the PSAs vested on March 31, 2021; the actual number of common shares that were issued was determined by multiplying the PSAs by a payout percentage based on the performance-based conditions achieved. The payout percentage was 126% for the 2019-2020 performance period and 200% for the 2020 performance period.

The unvested balance of RSUs and PSAs as of December 31, 2021 includes approximately 116,000 PSAs at a target level of performance. The vesting of these awards is subject to the achievement of specified performance-based conditions, and the actual number of common shares that will ultimately be issued will be determined by multiplying this number of PSAs by a payout percentage ranging from 0% to 200%.

The weighted-average grant date fair value of RSUs and PSAs granted during the years ended December 31, 2021, 2020, and 2019 was $33.30, $26.61, and $23.56, respectively. The total fair value of RSUs and PSAs vested during the years ended December 31, 2021, 2020, and 2019 was $3.3 million, $2.0 million, and $0, respectively.

Based on the estimated level of achievement of the performance targets associated with the PSAs, as of December 31, 2021, unrecognized compensation expense related to the unvested portion of the Company’s RSUs and PSAs was $2.7 million, which is expected to be recognized over a weighted-average period of 1.5 years.

Stock Awards

For the years ended December 31, 2021, 2020, and 2019, stock awards of 12,606 shares, 17,442 shares, and 11,924 shares, respectively, were granted to non-employee directors, which vested immediately upon issuance. The Company recorded compensation expense based on the weighted-average fair market value per share of the awards on the grant date of $30.94 in 2021, $25.81 in 2020, and $25.16 in 2019.