Restricted Stock Units and Performance Share Units

6 Months Ended

Jun. 30, 2011

Restricted Stock Units and Performance Share Units [Abstract]

Restricted Stock Units and Performance Share Units

(9)

Restricted Stock Units and Performance Share Units:

The Olympic Steel 2007 Omnibus Incentive Plan (the Plan) was approved by the Company’s shareholders in 2007. The Plan authorizes the Company to grant stock options, stock appreciation rights, restricted shares, restricted share units, performance shares, and other stock-and cash-based awards to employees and Directors of, and consultants to, the Company and its affiliates. Under the Plan, 500,000 shares of common stock are available for equity grants.

On each of March 1, 2011, January 4, 2010, January 2, 2009 and January 2, 2008, the Compensation Committee of the Company’s Board of Directors approved the grant of 1,800 restricted stock units (RSUs) to each non-employee Director. Subject to the terms of the Plan and the RSU agreement, the RSUs vest after one year of service (from the date of grant). The RSUs are not converted into shares of common stock until the director either resigns or is terminated from the Board of Directors.

On January 4, 2010, the Compensation Committee of the Company’s Board of Directors approved the grant of 23,202 RSUs in the aggregate to the members of senior management of the Company. Subject to the terms of the Plan and the RSU agreement, the RSUs vest at the end of three years from the date of grant.

The Compensation Committee of the Company’s Board of Directors also granted 34,379 and 54,024 performance-earned restricted stock units (PERSUs) in the aggregate to the members of senior management of the Company on January 2, 2008 and January 2, 2009, respectively. The PERSUs may be earned based on the Company’s performance for a period of 36 months from the date of grant, and would be converted to shares of common stock based on the achievement of two separate financial measures: (1) the Company’s EBITDA (50% weighted) and (2) return on invested capital (50% weighted). No shares will be earned unless the threshold amounts for the performance measures are met. Up to 150% of the targeted amount of PERSUs may be earned. On December 31, 2010, the 33,681 PERSUs outstanding granted on January 2, 2008 lapsed based on failure to meet the minimum performance requirements.

The fair value of each RSU and PERSU was estimated to be the closing price of the Company’s common stock on the date of the grant, which was $26.91, $33.85, $21.68 and $32.20 for the grants on March 1, 2011, January 4, 2010, January 2, 2009 and January 2, 2008, respectively.

Stock-based compensation expense recognized on RSUs and PERSUs for the three and six months ended June 30, 2011 and 2010, respectively, is summarized in the following table:


	Three Months				Six Months
	Ended June 30,				Ended June 30,
(in thousands, except per share data)	2011		2010		2011		2010
Stock based expense before taxes	$	129	$	18	$	216	$	60
Stock based expense after taxes	$	78	$	11	$	133	$	38
Impact per basic share	$	0.01	$	—	$	0.01	$	—
Impact per diluted share	$	0.01	$	—	$	0.01	$	—

Pre-tax charges related to RSUs and PERSUs were included in the caption “Administrative and general” on the accompanying Consolidated Statement of Operations.

The following table summarizes the activity related to RSUs for the six months ended June 30, 2011:


				Weighted
				Average		Aggregate
	Number of			Exercise		Intrinsic
	Shares			Price		Value
Outstanding at December 31, 2010		46,602		$	33.41
Granted		18,825		$	26.91
Converted into shares		—		$	—
Forfeited		(1,235	)	$	33.85

Outstanding at June 30, 2011		64,192		$	32.15	$	43

Vested at June 30, 2011		31,959		$	31.08	$	38

No RSUs were converted into common shares during the six months ended June 30, 2011 or 2010.

The following table summarizes the activity related to PERSUs for the six months ended June 30, 2011:


				Weighted
				Average		Aggregate
	Number of			Exercise		Intrinsic
	Shares			Price		Value
Outstanding at December 31, 2010		52,987		$	21.68
Granted		—		$	—
Converted into shares		—		$	—
Lapsed based on performance criteria		—		$	—
Forfeited		(2,178	)	$	21.68

Outstanding at June 30, 2011		50,809		$	21.68	$	297

Vested at June 30, 2011		—		$	—	$	—

Since inception of the PERSU program, no PERSUs have been converted into shares. There was no expense included on the accompanying Consolidated Statement of Operations for the three or six months ended June 30, 2011 or 2010 related to the PERSUs as the minimum performance requirements for the PERSUs are not expected to be met.