Quarterly report pursuant to Section 13 or 15(d)

Employee Benefits and Compensation Plans

v3.7.0.1
Employee Benefits and Compensation Plans
6 Months Ended
Jun. 30, 2017
Postemployment Benefits [Abstract]  
Employee Benefits and Compensation Plans
7. Employee Benefits and Compensation Plans

 

Share-Based Compensation

 

As a result of our adoption of ASU No. 2016-09, beginning in the first quarter of 2017, we began accounting for forfeitures as they occur, rather than estimating expected forfeitures. Pursuant to the modified-retrospective application, the net cumulative effect of this change was recognized as a $2.2 million increase to retained earnings as of January 1, 2017 (we refer you to our consolidated statements of changes in shareholders’ equity).

 

Share Option Awards

 

The following is a summary of option activity under our Amended and Restated 2013 Performance Incentive Plan for the six months ended June 30, 2017 (excludes the impact of 208,335 previously awarded performance-based options as no grant date has been established):

 

    Number of Share Option
Awards
    Weighted-Average Exercise
Price
    Weighted-
Average
Contractual Term
   

Aggregate

Intrinsic Value

 
    Time-
Based
Awards
    Performance-
Based
Awards
    Market-
Based
Awards
    Time-
Based
Awards
    Performance-
Based
Awards
    Market-
Based
Awards
    (years)     (in thousands)  
Outstanding as of January 1, 2017     7,775,058       432,978       208,333     $ 48.04     $ 23.86     $ 59.43       7.81     $ 35,429  
Granted           156,249                   59.43                    
Exercised     (383,203 )     (59,218 )           28.33       19.00                    
Forfeited and cancelled     (325,030 )     (93,749 )           55.03       59.43                  
Outstanding as of June 30, 2017     7,066,825       436,260       208,333     $ 48.79     $ 29.62     $ 59.43       7.44     $ 61,204  

 

Restricted Ordinary Share Awards

 

The following is a summary of restricted ordinary share activity for the six months ended June 30, 2017:

 

    Number of
Time-Based
Awards
    Weighted-
Average Grant
Date Fair
Value
 
Non-vested as of January 1, 2017     16,872     $ 7.63  
Granted            
Vested     (11,338 )     5.53  
Forfeited or expired            
Non-vested and expected to vest as of June 30, 2017     5,534     $ 11.94  

 

Restricted Share Unit Awards

 

On March 1, 2017, we granted 1.7 million time-based restricted share unit awards to our employees which vest equally over three years. Additionally, on March 1, 2017, we awarded 121,000 performance-based restricted share units to certain members of our management team which vest upon the achievement of certain pre-established performance targets.

 

The following is a summary of restricted share unit activity for the six months ended June 30, 2017 (excludes the impact of 171,000 previously awarded performance-based restricted share units as no grant date was established):

 

    Number of
Time-Based
Awards
    Weighted-
Average Grant
Date Fair
Value
    Number of
Performance-
Based
Awards
    Weighted-
Average Grant
Date Fair Value
    Number of
Market-
Based
Awards
    Weighted-
Average Grant
Date Fair Value
 
Non-vested as of January 1, 2017     1,305,335     $ 50.38           $       50,000     $ 59.43  
Granted     1,750,612       50.96       37,500       49.76              
Vested     (440,508 )     50.67       (15,000 )     49.76              
Forfeited or expired     (36,507 )     50.61       (22,500 )     49.76              
Non-vested and expected to vest as of June 30, 2017     2,578,932       50.72                   50,000       59.43  

 

The share-based compensation expense for the six months ended June 30, 2017 was $42.2 million of which $38.5 million was recorded in marketing, general and administrative expense and $3.7 million was recorded in payroll and related expense.