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Table of Contents HOLLYFRONTIER CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Continued
70
The compensation cost charged against income for these plans was $26.9 million, $26.1 million and $32.2 million for the years
ended December 31, 2015, 2014 and 2013, respectively. Our accounting policy for the recognition of compensation expense for
awards with pro-rata vesting is to expense the costs ratably over the vesting periods.
Additionally, HEP maintains a share-based compensation plan for Holly Logistic Services, L.L.C.'s non-employee directors and
certain executives and employees. Compensation cost attributable to HEP’s share-based compensation plan was $3.5 million, $3.5
million and $3.6 million for the years ended December 31, 2015, 2014 and 2013, respectively.
Restricted Stock and Restricted Stock Units
Under our Long-Term Incentive Compensation Plan, we grant certain officers and other key employees restricted stock and
restricted stock unit awards with awards generally vesting over a period of one to three years. Restricted stock award recipients
are generally entitled to all the rights of absolute ownership of the restricted shares from the date of grant including the right to
vote the shares and to receive dividends. Upon vesting, restrictions on the restricted shares lapse at which time they convert to
common shares. In addition, we grant non-employee directors restricted stock unit awards, which typically vest over a period of
one year and are payable in stock. The fair value of each restricted stock and restricted stock unit award is measured based on the
grant date market price of our common shares and is amortized over the respective vesting period.
A summary of restricted stock and restricted stock unit activity and changes during the year ended December 31, 2015 is presented
below:
Restricted Stock and Restricted Stock Units Grants
Weighted
Average Grant
Date Fair
Value
Aggregate
Intrinsic Value
($000)
Outstanding at January 1, 2015 (non-vested) 669,777 $ 44.12
Granted 447,544 49.92
Vesting (transfer/conversion to common stock) (337,159) 42.03
Forfeited (57,637) 48.40
Outstanding at December 31, 2015 (non-vested) 722,525 $ 48.35 $ 27,950
For the years ended December 31, 2015, 2014 and 2013, restricted stock and restricted stock units vested having a grant date fair
value of $14.2 million, $18.2 million and $16.2 million, respectively. For the years ended December 31, 2014 and 2013, we granted
restricted stock and restricted stock units having a weighted average grant date fair value of $42.03 and $42.00, respectively. As
of December 31, 2015, there was $23.7 million of total unrecognized compensation cost related to non-vested restricted stock and
restricted stock unit grants. That cost is expected to be recognized over a weighted-average period of 1.6 years.
Performance Share Units
Under our Long-Term Incentive Compensation Plan, we grant certain officers and other key employees performance share units,
which are payable in stock upon meeting certain criteria over the service period, and generally vest over a period of three years.
Under the terms of our performance share unit grants, awards are subject to “financial performance” and “market performance”
criteria. Financial performance is based on our financial performance compared to a peer group of independent refining companies,
while market performance is based on the relative standing of total shareholder return achieved by HollyFrontier compared to
peer group companies. The number of shares ultimately issued under these awards can range from zero to 200% of target award
amounts. As of December 31, 2015, estimated share payouts for outstanding non-vested performance share unit awards averaged
approximately 85% of target amounts.