|9 Months Ended|
Dec. 31, 2019
|Share-based Payment Arrangement [Abstract]|
|Stock-based Compensation||Stock-Based Compensation
As of December 31, 2019, the KEMET Corporation Omnibus Incentive Plan (the “Incentive Plan”) is the only plan utilized by the Company to issue equity-based awards to executives and key employees.
The Incentive Plan has authorized, in the aggregate, the grant of up to 12.2 million shares of the Company’s Common Stock, comprised of 11.4 million shares under the Incentive Plan and 0.8 million shares remaining from prior plans, and authorizes the Company to provide equity-based compensation in the form of the following:
Except as described below, options issued under these plans vest within one to three years and expire ten years from the grant date.
Restricted Stock Units (“RSUs”) and Long-term Incentive Plans (“LTIP”)
Time-based RSUs vest over three years, except for RSUs granted to non-employee members of the Board of Directors (the “Board”), which vest immediately. The Company grants RSUs to members of the Board, the Chief Executive Officer and key members of management. Once vested and settled, RSUs are converted into stock. For members of the Board and key members of management, such stock cannot be sold until 90 days after termination of service with the Company, or until the individual achieves the targeted ownership under the Company’s stock ownership guidelines, and then only to the extent that such ownership level exceeds the target. Compensation expense is recognized over the respective vesting periods.
Historically, the Board of the Company has approved annual LTIPs, which cover two-year periods and are primarily based upon the achievement of an Adjusted EBITDA range for the two-year period. At the time of the award, the individual plans entitle the participants to receive cash or RSUs, or a combination of both as determined by the Company's Board. The Company assesses the likelihood of meeting the Adjusted EBITDA financial metric on a quarterly basis and adjusts compensation expense to match expectations. The 2017/2018 LTIP, 2018/2019 LTIP, 2019/2020 LTIP and 2020/2021 LTIP also awarded time-based RSUs which vest over the course of three years from the anniversary of the grant date and are not subject to a performance metric. Any related liability (for the cash portion of the LTIP) is reflected in the line item “Accrued expenses” on the Condensed Consolidated Balance Sheets and any RSU commitment is reflected in the line item “Additional paid-in capital” on the Condensed Consolidated Balance Sheets.
On May 18, 2019, the Company granted RSUs under the 2020/2021 LTIP with a grant date fair value of $18.15 per share that vest as follows (amounts in thousands):
(1) RSUs granted include time-based and performance-based RSUs. Therefore, the granted performance-based RSUs included above are an estimate based upon current performance expectations. The final number of RSUs granted depends on the achievement of performance metrics.
The following is the vesting schedule of RSUs under each respective LTIP, that vested during the nine months ended December 31, 2019 (shares in thousands):
RSU activity, including performance-based and time-based LTIP activity, for the nine months ended December 31, 2019 is as follows (amounts in thousands except fair value):
The expense associated with stock-based compensation for the three months ended December 31, 2019 and 2018 is recorded on the Condensed Consolidated Statements of Operations as follows (amounts in thousands):
The expense associated with stock-based compensation for the nine months ended December 31, 2019 and 2018 is recorded on the Condensed Consolidated Statements of Operations as follows (amounts in thousands):
In the “Operating activities” section of the Condensed Consolidated Statements of Cash Flows, stock-based compensation expense was treated as an adjustment to net income for the nine months ended December 31, 2019, and 2018. There were 53,667 stock options exercised in the nine months ended December 31, 2019 and 72,800 stock options were exercised in the nine months ended December 31, 2018.
The entire disclosure for share-based payment arrangement.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef