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SEC Filings

10-Q
NN INC filed this Form 10-Q on 11/09/2017
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Table of Contents

Stock Options

During the nine months ended September 30, 2017, we granted 125,700 option awards to officers and certain other key employees. The weighted average grant date fair value of options granted during the nine months ended September 30, 2017, was $11.84 per share. The fair value of these options cannot be determined by market value because the options are not traded in an open market. Accordingly, we utilized the Black Scholes financial pricing model to estimate the fair value. The following table shows the weighted average assumptions relevant to determining the fair value of the 2017 stock option grants.

 

     2017
Stock Option
Awards
 

Expected term

     6 years  

Risk free interest rate

     2.03

Dividend yield

     1.16

Expected volatility

     56.56

Expected forfeiture rate

     3.00

The following table provides a reconciliation of option activity for the nine months ended September 30, 2017.

 

            Weighted-      Weighted-         
            Average      Average         
            Exercise      Remaining      Aggregate  
            Price      Contractual      Intrinsic  

Options

   Shares (000)      (per share)      Term (years)      Value  

Outstanding at January 1, 2017

     897      $ 12.22        

Granted

     126        24.20        

Exercised

     (250      11.79        

Forfeited or expired

     (6      7.72        
  

 

 

    

 

 

       

Outstanding at September 30, 2017

     767      $ 14.32        6.5      $ 11,246 (1) 
  

 

 

    

 

 

    

 

 

    

 

 

 

Exercisable at September 30, 2017

     583      $ 12.71        5.7      $ 9,500 (1) 
  

 

 

    

 

 

    

 

 

    

 

 

 

 

(1) The intrinsic value is the amount by which the market price of our stock was greater than the exercise price of any individual option grant at September 30, 2017.

Restricted Stock

During the nine months ended September 30, 2017, we granted 85,393 restricted stock awards to non-executive directors, officers and certain other key employees. The shares of restricted stock granted during the nine months ended September 30, 2017, vest pro-rata over three years for officers and certain other key employees and over one year for non-executive directors. We determined the fair value of the shares issued by using the closing price of our common stock as of the date of grant. The weighted average grant date value of restricted stock granted in the nine months ended September 30, 2017, was $24.29 per share.

Performance Share Units

During the nine months ended September 30, 2017, we granted 98,618 performance share units to officers and certain other key employees. The performance share units granted will be satisfied in the form of shares of common stock during 2020 if certain performance and/or market conditions are met. We recognize the compensation expense over the three-year period in which the performance and market conditions are measured. We determined the fair value per share of the performance share units issued by using the grant date closing price of our common stock for the units with a performance condition, or $24.20, and a Monte Carlo valuation model for the units that have a market condition, or $29.84.

 

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