Equity and Stock-Based Compensation

9 Months Ended

Sep. 30, 2020

Common Stock Dividends—The following table summarizes the common stock dividends declared during the period (in thousands):



	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Common stock dividends declared	$	—	$	5,339	$	—	$	16,004

Performance Stock Units—The compensation committee of the board of directors of the Company may authorize the issuance of grants of performance stock units (“PSUs”) to certain executive officers and directors from time to time. The award agreements provide for the grant of a target number of PSUs that will be settled in shares of common stock of the Company, if, when and to the extent the applicable vesting criteria have been achieved following the end of the performance and service period, which is generally three years from the grant date. The number of PSUs actually earned may range from 0% to 200% of target based on achievement of a specified relative total stockholder return based on the formula determined by the Company’s compensation committee on the grant date. The performance criteria for the PSUs are based on market conditions under the relevant literature, and the PSUs were granted to non-employees. The corresponding compensation cost is recognized ratably over the service period for the award as the service is rendered, based on the grant date fair value of the award, regardless of the actual outcome of the market condition as opposed to being accounted for at fair value based on the market price of the shares at each quarterly measurement date. In March 2020, 225,000 PSUs with a fair value of approximately $790,000 and a vesting period of three years were granted.

Restricted Stock Units—We incur stock-based compensation expense in connection with restricted stock units awarded to certain employees of Ashford LLC and its affiliates. We also issue common stock to certain of our independent directors, which vests immediately upon issuance. In March 2020, 311,000 restricted stock units with a fair value of approximately $1.4 million

and a vesting period of three years were granted. On May 15, 2020, approximately 17,000 shares of common stock were issued to independent directors, with a fair value of approximately $37,000, which vested immediately upon grant.

On May 22, 2020 and September 28, 2020, approximately 18,000 and 9,000 shares of common stock, respectively, were issued to independent directors, with fair values of approximately $48,000 and $23,000, respectively, which vested immediately upon grant and have been expensed during the nine months ended September 30, 2020. These grants represented a portion of the annual cash retainer for each independent director serving on the Company’s board of directors, resulting from the COVID-19 related modifications to our director compensation program discussed in note 11.

8.25% Series D Cumulative Preferred Stock Dividends—The Series D Cumulative Preferred Stock dividend for all issued and outstanding shares is set at $2.0625 per annum per share.

The following table summarizes dividends declared (in thousands):



	Three Months Ended September 30,			Nine Months Ended September 30,
	2020		2019	2020		2019
Series D Cumulative Preferred Stock	$	825	825	$	2,475	$	2,475

Stock Repurchases—On December 5, 2017, our board of directors reapproved the stock repurchase program pursuant to which the board of directors granted a repurchase authorization to acquire shares of the Company’s common stock, par value $0.01 per share and preferred stock having an aggregate value of up to $50 million. The board of directors’ authorization replaced any previous repurchase authorizations.

No shares were repurchased during the three and nine months ended September 30, 2020 and 2019. As of September 30, 2020, $50 million remains authorized by the board of directors pursuant to the December 5, 2017 approval.

At-the-Market Common Stock Equity Distribution Program—On December 11, 2017, the Company established an “at-the-market” equity distribution program pursuant to which it may, from time to time, sell shares of its common stock having an aggregate offering price of up to $50 million. As of September 30, 2020, 3.0 million shares of our common stock with an aggregate offering price of $7.7 million have been sold under this program.

The issuance activity is summarized below (in thousands):



	Three Months Ended September 30,		Nine Months Ended September 30,
	2020		2020
Common shares issued	3,046		3,046
Gross proceeds received	$	7,715	$	7,715
Commissions and other expenses	97		97
Net proceeds	$	7,618	$	7,618