Incentive Stock Plans

3 Months Ended

Apr. 01, 2023

Share-Based Payment Arrangement [Abstract]

13. Incentive Stock Plans

Stock-based compensation expense for the three months ended April 1, 2023 and March 26, 2022 was $1 million and $2 million, respectively.

The Company made new grants of restricted stock units, performance-based stock units and performance-based cash units during the first quarter of 2023. The 2023 restricted stock unit awards cliff vest after three years. The 2023 performance-based awards cliff vest after three years and are based equally on TSR relative to peers and three-year cumulative adjusted EBITDA. Participants can earn between 0 and 200 percent of the target award. Performance below the threshold for the TSR would result in zero payout for the TSR metric. The performance-based cash unit award is measured using the same objectives as the performance-based stock unit award, but is paid and accounted for separately. Performance-based cash unit awards are classified as a liability and remeasured to fair value at the end of each reporting period until settlement.

In March 2023, the performance-based stock units granted in 2020 were settled with the issuance of 1,257,015 shares of common stock, including incremental shares of 370,366, based on performance results.

The following table summarizes the activity of the Company’s incentive stock awards:


	Stock Options			Restricted Stock Units			Performance-Based Stock Units
	Options	Weighted Average Exercise Price		Awards	Weighted Average Grant Date Fair Value		Awards	Weighted Average Grant Date Fair Value
Outstanding at December 31, 2022	77,767	$	39.98	1,697,587	$	6.21	1,956,919	$	6.79
Granted	—	—		278,376	7.88		225,424	11.20
Forfeited	—	—		(22,480)	6.39		(5,433)	4.73
Exercised or settled	—	—		(464,523)	5.75		(886,649)	5.95
Expired or cancelled	(30,885)	43.35		—	—		—	—
Outstanding at April 1, 2023	46,882	$	37.76	1,488,960	$	6.66	1,290,261	$	8.12