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Accounting for Stock-Based Compensation
6 Months Ended
Sep. 30, 2022
Share-Based Payment Arrangement [Abstract]  
Accounting for Stock-Based Compensation Accounting for Stock-Based Compensation
The Company records compensation expense associated with restricted stock in accordance with ASC Topic 718 (“Share Based Payment”) (ASU 2016-09). The Company had 958,998 common shares issued under the 2016 Employee Equity Compensation Restricted Stock Plan (“2016 Employee Plan”), and 240,755 common shares issued under the 2015 Outside Director Equity Compensation Restricted Stock Plan (“2015 Director Plan”) at September 30, 2022, all shares of which were issued subject to a restriction or forfeiture period that lapses ratably on the first, second, and third anniversaries of the date of grant, and the fair value of which is being amortized over the one to three-year restriction period, with the exception of performance restricted shares which were issued to the Chief Executive Officer and Chief Financial Officer.
In August 2021, the Company issued 90,000 restricted shares and 510,000 performance restricted shares to the Company’s CEO, in accordance with the CEO’s employment agreement, under the 2016 Employee Plan. The fair value of the 90,000 restricted shares issuance was valued at $28.70 per share. The value of the 510,000 performance restricted shares issuance was valued by a third party valuation firm, and these shares were valued at $9.7 million, or $19.06 per share. The valuation firm utilized a Monte Carlo model to value the 510,000 performance restricted shares and looked at several other factors such as historical stock price volatility. The fair value of the restricted performance shares is being amortized over the three-year restriction period.
Effective, August 3, 2022 Christine Chambers, the new Chief Financial Officer, received an initial equity award under the 2016 Employee Plan consisting of (i) an award of 13,000 restricted shares, and (ii) 3,000 performance restricted shares, which performance restricted shares will be based on the attainment of performance criteria equally weighted between adjusted EBITDA and revenue. The shares for each grant will be released from restriction equally over a three (3) year period on the anniversary of the grant date, subject to the attainment of performance criteria in the case of the performance restricted shares.
The Company issued 57,640 shares of restricted stock, net of forfeitures, to certain employees under the 2016 Employee Plan during the quarter ended September 30, 2022. The Company issued 30,000 shares of restricted stock, net of forfeitures, to board members under the 2015 Director Plan during the quarter ended September 30, 2022. For the quarters ended September 30, 2022 and 2021, the Company recognized $1.7 million and $0.9 million, respectively, of compensation expense related to the 2016 Employee Plan and 2015 Director Plan. For the six months ended September 30, 2022 and 2021, the Company recognized $3.2 million and $1.6 million, respectively, of compensation expense related to the 2016 Employee Plan and 2015 Director Plan. At September 30, 2022 and 2021 there was $12.2 million and $15.8 million of unrecognized compensation cost related to the non-vested restricted stock awards, respectively, which is expected to be recognized over the next one to three years. All stock-based compensation expense is recognized as a payroll-related expense and it is included within the general and administrative expenses line item within the Company’s income statement, and the offset is included in the additional paid-in capital line item of the Company’s balance sheet. On September 30, 2022 and 2021, there were 776,928 and 734,669 non-vested restricted shares issued and outstanding, respectively.
In July 2022, the Company’s 2022 Employee Equity Compensation Restricted Stock Plan (“2022 Employee Plan”) became effective upon the approval of the plan by the Company’s Shareholders. The 2022 Employee Plan authorizes 1,000,000 shares of the Company's common stock available for issuance under the plan. The value of the restricted stock is determined based on the market value of the stock at the issuance date. The restriction period or forfeiture period is determined by the Company’s Board of Directors and is to be no less than 1 year and no more than ten years. No shares had been issued under the 2022 Employee Plan as of September 30, 2022.