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INVACARE CORPORATION AND SUBSIDIAIRIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
FS-27
Restricted Stock and Restricted Stock Units
The following table summarizes information about restricted shares and restricted share units (for non-U.S. recipients):
2014
Weighted
Average
Fair Value 2013
Weighted
Average
Fair Value 2012
Weighted
Average
Fair Value
Stock / Units unvested at January 1 . . . . . . 264,878 $ 16.69 260,548 $ 19.15 249,499 $ 23.76
Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . 218,276 19.36 114,700 14.49 118,200 13.41
Vested . . . . . . . . . . . . . . . . . . . . . . . . . . . . (93,140) 17.62 (97,445) 20.33 (96,520) 23.59
Canceled . . . . . . . . . . . . . . . . . . . . . . . . . . (77,591) 17.58 (12,925) 19.23 (10,631) 23.36
Stock / Units unvested at December 31 . . . 312,423 $ 17.91 264,878 $ 16.69 260,548 $ 19.15
The restricted stock awards vest ratably over the three years after the award date, except for those awards granted in 2014,
which vest after a three-year period. Unearned restricted stock compensation, determined as the market value of the shares at the
date of grant, is being amortized on a straight-line basis over the vesting period.
Performance Shares and Performance Share Units
The following table summarizes information about performance shares and performance share units (for non-U.S. recipients):
2014
Weighted
Average
Fair Value
Shares / Units unvested at January 1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — $ —
Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 152,800 20.05
Vested . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — —
Canceled . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (31,156) 20.05
Shares / Units unvested at December 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 121,644 $ 20.05
During 2014, the performance shares and performance share units (for non-U.S. recipients) were granted as performance
awards with a 3 year performance period with payouts based on achievement of certain performance goals. The awards are classified
as equity awards as they will be settled in common shares upon vesting. The number of shares earned will be determined at the
end of the performance period based on achievement of performance criteria for January 1, 2016 through December 31, 2016
established by the Compensation Committee at the time of grant. Recipients will be entitled to receive a number of common shares
equal to the number of performance shares that vest based upon the levels of achievement which may range between 0% and 150%
of the target number of shares with the target being 100% of the initial grant.
The fair value of the performance awards is based on the stock price on the date of grant discounted for the estimated value
of dividends foregone as the awards are not eligible for dividends except to the extent vested. The Company assesses the probability
that the performance targets will be met with expense recognized whenever it is probable that at least the minimum performance
criteria will be achieved. Depending upon the Company's assessment of the probability of achievement of the goals, the Company
may not recognize any expense associated with performance awards in a given period, may reverse prior expense recorded or
record additional expense to make up for expense not recorded in a prior period. Performance award compensation expense is
generally expected to be recognized over 3 years. However, for the year ended December 31, 2014, the Company concluded that
it was not probable that the performance goals, as defined in the agreements, would be achieved and thus no performance award
expense was recognized in 2014.
Rights Agreement
Effective July 8, 2005, the Company adopted a new Rights Agreement to replace the Company’s previous shareholder rights
plan, which expired on July 7, 2005. In order to implement the new Rights Agreement, the Board of Directors declared a dividend
of one Right for each outstanding share of the Company’s Common Shares and Class B Common Shares to shareholders of record
at the close of business on July 19, 2005. Each Right entitles the registered holder to purchase from the Company one one-