Share-Based Compensation

9 Months Ended

Sep. 28, 2022

Share-Based Payment Arrangement [Abstract]

Total share-based compensation included as a component of general and administrative expenses was as follows:


	Quarter Ended				Three Quarters Ended
	September 28, 2022		September 29, 2021		September 28, 2022		September 29, 2021
	(In thousands)
Employee share awards	$	1,706	$	3,127	$	8,784	$	9,544
Restricted stock units for board members	241		225		683		668
Total share-based compensation	$	1,947	$	3,352	$	9,467	$	10,212

Employee Share Awards

During the quarter ended March 30, 2022, we granted certain employees approximately 233,000 performance share units ("PSUs") with a grant date fair value of $24.51 per share that vest based on the total shareholder return (“TSR”) of our common stock compared to the TSRs of a group of peer companies and approximately 233,000 PSUs with a grant date fair value of $15.59 per share that vest based on our Adjusted EPS growth rate versus plan, as defined under the terms of the award. As the TSR based PSUs contain a market condition, a Monte Carlo valuation was used to determine the grant date fair value. The performance period for these PSUs is the three year fiscal period beginning December 30, 2021 and ending December 25, 2024. The PSUs will completely vest and be earned at the end of the performance period at which point the relative TSR and Adjusted EPS growth rate achievement percentages will be applied to the vested units (from 0% to 200% of the target award). We recognize compensation cost associated with approximately 312,000 of these PSU awards over the entire performance period on a straight-line basis, with compensation cost for the remaining 154,000 PSU awards recognized on a graded-vesting basis due to the accelerated vesting terms for certain retirement eligible individuals.

During the quarter ended March 30, 2022, we also granted certain employees approximately 310,000 restricted stock units ("RSUs") with a grant date fair value of $15.59 per share. The RSUs vest evenly over the three year fiscal period beginning December 30, 2021 and ending December 25, 2024. We recognize compensation cost associated with these RSU awards on a straight-line basis over the entire performance period of the award.

Additionally, during the quarters ended June 29, 2022 and September 28, 2022, we granted PSUs and RSUs to certain employees. The grants included approximately 78,000 PSUs with a weighted average grant date fair value of $12.18 per share that vest based on the TSR of our common stock compared to the TSRs of a group of peer companies and approximately 78,000 PSUs with a weighted average grant date fair value of $9.93 per share that vest based on our Adjusted EPS growth rate versus plan, as defined under the terms of the award. As the TSR based PSUs contain a market condition, a Monte Carlo valuation was used to determine the grant date fair value. The performance period and application of achievement percentages for these PSUs are the same as mentioned above. We recognize compensation cost associated with these PSU awards on a straight-line basis. In addition, the grants included approximately 104,000 RSUs with a weighted average grant date fair value of $9.93 per share.

During the three quarters ended September 28, 2022, we issued approximately 768,000 shares of common stock related to vested PSUs and RSUs. In addition, approximately 24,000 shares of common stock were deferred and approximately 407,000 shares of common stock were withheld in lieu of taxes related to vested PSUs and RSUs.

As of September 28, 2022, we had approximately $11.5 million of unrecognized compensation cost related to unvested PSU awards and RSU awards outstanding, which have a weighted average remaining contractual term of 1.9 years.

Restricted Stock Units for Board Members

During the quarter and three quarters ended September 28, 2022, we granted less than 0.1 million RSUs (which are equity classified) with a weighted average grant date fair value of $9.93 per unit to non-employee members of our Board of Directors. The RSUs vest after a one year service period. A director may elect to convert these awards into shares of common stock either on a specific date in the future (while still serving as a member of our Board of Directors), upon termination as a member of our Board of Directors, or in three equal annual installments commencing after termination of service as a member of our Board of Directors.

During the quarter and three quarters ended September 28, 2022, less than 0.1 million RSUs were converted into shares of common stock.

As of September 28, 2022, we had approximately $0.6 million of unrecognized compensation cost related to these unvested RSU awards outstanding, which have a weighted average remaining contractual term of 0.6 years.