SHARE-BASED PAYMENT

12 Months Ended

Dec. 31, 2021

SHARE-BASED PAYMENT

Share-Based Payment

NOTE 11—SHARE-BASED PAYMENT

As of December 31, 2021, there were 10.5 million shares of stock authorized for issuance to directors, officers, and employees under the 2020 Equity Incentive Plan (and predecessor plans). At December 31, 2021, 1.7 million shares remain available for grant under the 2020 Equity Incentive Plan.

Under the 2020 Equity Incentive Plan (and predecessor plans), the Company granted stock options to executive officers in the past and restricted shares to executive officers, employees, and non-employee directors during 2021, 2020, and 2019, all without cost to the grantee. For each of the three years ended December 31, 2021, 2020, and 2019, the Company also granted 0.3 million RSUs to the executive officers and certain other employees in connection with PSPs (“performance awards”). The Company granted the RSUs at the maximum performance

thresholds for each metric each year. As of December 31, 2021, the RSUs issued in connection with the 2021, 2020, and 2019 PSPs are unvested and outstanding.

The performance period for the 2018 PSP concluded on December 31, 2020. The three performance goals related to the 2018 PSP were met at varying levels. Accordingly, 0.1 million shares related to the 2018 PSP vested in the first quarter of 2021. As of December 31, 2021, the Company concluded that the three performance targets related to the 2019 PSP, 2020 PSP, and 2021 PSP were probable of achievement at varying levels. As of December 31, 2020, the Company concluded that the three performance targets related to the 2019 PSP and 2020 PSP were probable of achievement at varying levels and two performance targets related to the 2018 PSP were probable of achievement at various levels.

The following table summarizes stock compensation expense for the years ended December 31, 2021, 2020, and 2019:

	For the year ended December 31,
Components of stock compensation expense (in thousands)	2021		2020		2019
Restricted shares	$	25,520	$	18,924	$	17,818
Stock options		—		71		625
PSP "RSUs"		11,062		9,324		5,632
Total stock compensation expense	$	36,582	$	28,319	$	24,075
Excess tax benefit recognized	$	8,620	$	7,273	$	4,632

The amounts attributable to restricted shares in the table above include both equity-classified awards granted in restricted shares and liability-classified awards to be granted in restricted shares. The excess tax benefits recognized above reduced income tax expense.

The following table summarizes restricted share activity for the year ended December 31, 2021:

		Weighted-
		Average
		Grant-date
Restricted Shares Activity	Shares	Fair Value
Nonvested at January 1, 2021	1,122,614	$	62.41
Granted	447,619		101.48
Vested	(403,473)		61.16
Forfeited	(44,067)		79.65
Nonvested at December 31, 2021	1,122,693	$	77.70

The fair value of restricted share awards granted during 2021 was estimated using the closing price on the date of grant. The weighted average grant date fair values of restricted shares granted in 2020 and 2019 were $74.75 per share and $48.39 per share, respectively. The fair values of the restricted shares that vested during the years ended December 31, 2021, 2020, and 2019 were $44.6 million, $30.4 million, and $30.5 million, respectively.

As of December 31, 2021, the total unrecognized compensation cost for outstanding restricted shares was $51.1 million. As of December 31, 2021, the weighted-average period over which this unrecognized compensation cost will be recognized is 3.7 years.

The following table summarizes activity related to performance awards for the year ended December 31, 2021:

		Weighted-
		Average
		Grant-date
Restricted Share Units Activity	Share Units	Fair Value
Nonvested at January 1, 2021	770,493	$	50.37
Granted	263,845		101.04
Vested	(55,483)		100.36
Forfeited	(196,709)		49.80
Cancelled	(3,600)		67.13
Nonvested at December 31, 2021	778,546	$	67.66

The fair value of performance awards granted during 2021 was estimated using the closing price on the date of grant. The weighted average grant date fair values of performance awards granted in 2020 and 2019 were $50.26 per share and $52.84 per share, respectively. The fair value of the performance awards that vested during the years ended December 31, 2021, 2020 and 2019 was $5.6 million and $17.5 million, and $26.6 million, respectively.

As of December 31, 2021, the total unrecognized compensation cost for outstanding performance awards was $10.5 million. As of December 31, 2021, the weighted-average period over which this unrecognized compensation cost will be recognized is 1.5 years. The unrecognized compensation cost is based on the achievement levels that are probable as of December 31, 2021.

The following table summarizes stock options activity for the year ended December 31, 2021:

				Weighted-
		Weighted-		Average	Aggregate
		Average		Remaining	Intrinsic
		Exercise		Contract Life	Value
Stock Options Activity	Options	Price		(Years)	(in thousands)
Outstanding at January 1, 2021	461,340	$	22.51
Exercised	(227,334)		22.78
Outstanding at December 31, 2021	234,006	$	22.25		$
Exercisable at December 31, 2021	234,006	$	22.25	3.7	$	30,101

The total intrinsic value of the stock options exercised during the years ended December 31, 2021, 2020, and 2019 was $17.5 million, $21.6 million, and $2.7 million, respectively. We received no cash from the exercise of options for each of the years ended December 31, 2021, 2020, and 2019.