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Restricted Stock Units and Performance Share Units
9 Months Ended
Sep. 30, 2011
Stock Options and Restricted Stock Units and Performance Share Units [Abstract] 
Restricted Stock Units and Performance Share Units
(13) 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 January 2, 2008, January 2, 2009, January 4, 2010 and March 1, 2011, 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 PERSU’s 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 nine months ended September 30, 2011 and 2010, respectively, is summarized in the following table:

 

                                 
    Three Months Ended     Nine Months Ended  
  September 30,     September 30,  
  2011     2010     2011     2010  
(in thousands, except per share data)                        
RSU expense before taxes   $ 135     $ 142     $ 351     $ 425  
RSU expense after taxes   $ 118     $ 86     $ 234     $ 264  
Impact per basic share   $ 0.01     $ 0.01     $ 0.02     $ 0.02  
Impact per diluted share   $ 0.01     $ 0.01     $ 0.02     $ 0.02  

All 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 nine months ended September 30, 2011:

 

                         
    Number of     Weighted Average     Aggregate  
  Shares     Exercise Price     Intrinsic 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 September 30, 2011     64,192     $ 32.15       —    
   

 

 

    

 

 

    

 

 

  
Vested at September 30, 2011     31,959     $ 31.08       —    
   

 

 

    

 

 

    

 

 

  

No RSUs were converted into shares during the nine months ended September 30, 2011. 7,200 RSUs were converted into shares during the nine months ended September 30, 2010.

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

 

                         
    Number of     Weighted Average     Aggregate  
    Shares     Exercise Price     Intrinsic 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 September 30, 2011     50,809     $ 21.68       —    
   

 

 

    

 

 

    

 

 

  
Vested at September 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 nine months ended September 30, 2011 or 2010 related to the PERSUs as the minimum performance requirements for the PERSUs are not expected to be met.