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SEC Filing Details

10-K
NRG ENERGY, INC. filed this Form 10-K on 03/01/2018
Entire Document
 

Market Stock Units — MSUs are restricted grants where the quantity of shares increases and decreases alongside the Company's TSR. Each MSU represents the potential to receive NRG common stock after the completion of the performance period, typically three years of service from the date of grant. The number of shares of common stock to be paid as of the vesting date for each MSU is : (i) zero shares, if the TSR has decreased by more than 25% over the performance period, (ii) three-quarters of one share, if the TSR has decreased by 25% over the performance period; (iii) interpolated between three-quarters of one share and one share, if the TSR has decreased less than 25% over the performance period; (iv) one share, if there is no change in TSR over the performance period; (v) interpolated between one share and two shares, if TSR increases less than 100% during the performance period; and (vi) two shares, if the TSR increases 100% over the performance period. The value of the common stock on the date of grant is based on the closing price of NRG common stock on the date of grant. The Company last granted MSUs during the year ended December 31, 2016.
The following table summarizes the Company's non-vested PSU awards and changes during the year:
 
Units(a)
 
Weighted Average Grant-Date Fair Value per Unit
Non-vested at December 31, 2016
1,282,588

 
$
21.47

Granted
738,830

 
15.91

Forfeited
(162,597
)
 
31.85

Non-vested at December 31, 2017
1,858,821

 
18.27

(a) There were no PSUs granted to GenOn employees and outstanding as of December 31, 2017.
The weighted average grant date fair value of PSUs granted during the years ended December 31, 2017, 2016 and 2015, was $15.91, $14.73 and $26.68, respectively.
The fair value of PSUs is estimated on the date of grant using a Monte Carlo simulation model and expensed over the service period, which equals the vesting period. Significant assumptions used in the fair value model with respect to the Company's PSUs are summarized below:
 
2017
 
2016
 
RPSUs
 
MSUs
Expected volatility
43.96
%
 
34.33
%
Expected term (in years)
3

 
3

Risk free rate
1.5
%
 
1.31
%
For the years ended December 31, 2017 and 2016, expected volatility is calculated based on NRG's historical stock price volatility data over the period commensurate with the expected term of the PSU, which equals the vesting period.

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