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Share-Based Compensation
 12 Months Ended
Dec. 31, 2021
Share-based Payment Arrangement [Abstract]  
Share-Based Compensation SHARE-BASED COMPENSATION
Share-based compensation expense was $128 million in 2021 ($133 million and $95 million in 2020 and 2019, respectively). The related income tax benefit recognized was $64 million in 2021 ($79 million and $42 million in 2020 and 2019, respectively). The expense was primarily recorded in selling, general and administrative expenses and no share-based compensation expense was capitalized.
Summary of Plans
The 2021 Linde plc Long Term Incentive Plan (the “2021 Plan") was adopted by the Board of Directors and shareholders of Linde plc on July 26, 2021. Upon adoption of the 2021 Plan, any authorized shares that remained available for grant for new awards under the Amended and Restated 2009 Linde Long Term Incentive Plan (the “2009 Plan”) were cancelled. The 2021 Plan permits awards of stock options, stock appreciation rights, restricted stock and restricted stock units, performance-based stock units and other equity awards to eligible officer and non-officer employees and non-employee directors of the company and its affiliates. As of December 31, 2021, 8,995,710 shares remained available for equity grants under the 2021 Plan, of which 2,995,710 shares may be granted as awards other than options or stock appreciation rights.

Exercise prices for options granted under the 2021 Plan may not be less than the closing market price of the company’s ordinary shares on the date of grant and granted options may not be re-priced or exchanged without shareholder approval. Options granted under the 2021 Plan subject only to time vesting requirements may become partially exercisable after a minimum of one year after the date of grant but may not become fully exercisable until at least three years have elapsed from the date of grant, and all options have a maximum duration of ten years.
In connection with the business combination, on October 31, 2018 the company's Board of Directors adopted the Long Term Incentive Plan 2018 of Linde plc (“the LTIP 2018”), the purpose of which was to replace certain outstanding Linde AG equity based awards that were terminated. Under the LTIP 2018, the aggregate number of shares available for replacement option rights and replacement restricted share units was set at 473,128. As of December 31, 2021, 285,113 shares remained available for grant, and since the company was obligated to make these replacement awards only in 2019, no further grants will be made under this plan.
Exercise prices for the replacement option rights that were granted in 2019 under the LTIP 2018 were equal to EUR 1.67 ($1.92 as converted at an exchange rate from the time the exchange offer was completed as the option rights are exercisable in U.S. dollars on the NYSE) as prescribed in the business combination agreement. Each replacement option right granted under the LTIP 2018 is subject to vesting based on continued service until the end of the four-year waiting period applicable to the relevant Linde AG award that had been granted before the business combination. After vesting, each option right will be exercisable for one year.
In order to satisfy option exercises and other equity grants, the company may issue authorized but previously unissued shares or it may issue treasury shares.
Stock Option Fair Value
The company utilizes the Black-Scholes Options-Pricing Model to determine the fair value of stock options consistent with that used in prior years. Management is required to make certain assumptions with respect to selected model inputs, including anticipated changes in the underlying stock price (i.e., expected volatility) and option exercise activity (i.e., expected life). Expected volatility is based on the historical volatility of the company’s stock over the most recent period commensurate with the estimated expected life of the company’s stock options and other factors. The expected life of options granted, which represents the period of time that the options are expected to be outstanding, is based primarily on historical exercise experience. The expected dividend yield is based on the company’s most recent history and expectation of dividend payouts. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant for a period commensurate with the estimated expected life. If factors change and result in different assumptions in future periods, the stock option expense that the company records for future grants may differ significantly from what the company has recorded in the current period.
The weighted-average fair value of options granted during 2021 was $37.80 ($17.37 in 2020 and $23.38 in 2019) based on the Black-Scholes Options-Pricing model. The increase in grant date fair value year-over-year is primarily attributable to the increase in the stock price. The weighted-average fair value of replacement option rights granted in 2019 was $160.08 based on intrinsic value method.
The following weighted-average assumptions were used to value the grants in 2021, 2020 and 2019: 
Year Ended December 31,202120202019
Dividend yield1.7 %2.2 %2.0 %
Volatility18.4 %15.8 %14.3 %
Risk-free interest rate1.10 %0.60 %2.38 %
Expected term years666
The following table summarizes option activity under the plans as of December 31, 2021 and changes during the period then ended (averages are calculated on a weighted basis; life in years; intrinsic value expressed in millions): 
ActivityNumber  of
Options
(000’s)		Average
Exercise
Price		Average
Remaining
Life		Aggregate
Intrinsic
Value
Outstanding at January 1, 20218,067 $136.05 
Granted831 253.68 
Exercised(1,672)121.40 
Cancelled or expired(60)207.35 
Outstanding at December 31, 20217,166 $152.56 6.0$1,389 
Exercisable at December 31, 20215,297 $132.84 5.0$1,131 
The aggregate intrinsic value represents the difference between the company’s closing stock price of $346.43 as of December 31, 2021 and the exercise price multiplied by the number of in the money options outstanding as of that date. The total intrinsic value of stock options exercised during 2021 was $294 million ($264 million and $219 million in 2020 and 2019, respectively).
Cash received from option exercises under all share-based payment arrangements for 2021 was $50 million ($36 million and $64 million in 2020 and 2019, respectively). The cash tax benefit realized from share-based compensation totaled $64 million for 2021 ($70 million and $56 million cash tax benefit in 2020 and 2019, respectively).
As of December 31, 2021, $17 million of unrecognized compensation cost related to non-vested stock options is expected to be recognized over a weighted-average period of approximately 1 year.
Performance-Based and Restricted Stock Awards
In 2021, the company granted 187,830 performance-based stock awards under the 2009 Plan to senior management that vest, subject to the attainment of pre-established minimum performance criteria, principally on the third anniversary of their date of grant. These awards are tied to either after tax return on capital ("ROC") performance or relative total shareholder return ("TSR") performance versus that of the S&P 500 (weighted 67%) and Eurofirst 300 (weighted 33%). The actual number of shares issued in settlement of a vested award can range from zero to 200 percent of the target number of shares granted based upon the company’s attainment of specified performance targets at the end of a three-year period. Compensation expense related to these awards is recognized over the three-year performance period based on the fair value of the closing market price of the company’s ordinary shares on the date of the grant and the estimated performance that will be achieved. Compensation expense for ROC awards will be adjusted during the three-year performance period based upon the estimated performance levels that will be achieved. TSR awards are measured at their grant date fair value and not subsequently re-measured.
The weighted-average fair value of ROC performance-based stock awards granted in 2021 was $241.10 ( $161.56 in 2020 and $168.47 in 2019). These fair values are based on the closing market price of Linde's ordinary shares on the grant date adjusted for dividends that will not be paid during the vesting period.
The weighted-average fair value of performance-based stock tied to relative TSR performance granted in 2021 was $301.04 ($198.61 in 2020 and $215.85 in 2019) and was estimated using a Monte Carlo simulation performed as of the grant date.
There were 175,597 restricted stock units granted to employees by Linde during 2021. The weighted-average fair value of restricted stock units granted during 2021 was $242.60 ($174.95 in 2020 and $165.04 in 2019). These fair values are based on the closing market price of Linde's ordinary shares on the grant date adjusted for dividends that will not be paid during the vesting period. Compensation expense related to the restricted stock units is recognized over the vesting period.
The following table summarizes non-vested performance-based and restricted stock award activity as of December 31, 2021 and changes during the period then ended (shares based on target amounts, averages are calculated on a weighted basis): 
  
Performance-BasedRestricted Stock
Number of
Shares
(000’s)		Average
Grant Date
Fair Value		Number of
Shares
(000’s)		Average
Grant Date
Fair Value
Non-vested at January 1, 2021437 $179.76 688 $148.56 
Granted188 262.56 176 242.60 
Vested— — (213)147.84 
Cancelled and Forfeited(15)221.70 (15)206.65 
Non-vested at December 31, 2021610 $204.39 636 $172.90 
There are approximately 14 thousand performance-based shares and 15 thousand restricted stock shares that are non-vested at December 31, 2021 which will be settled in cash due to foreign regulatory limitations. The liability related to these grants reflects the current estimate of performance that will be achieved and the current share price.
As of December 31, 2021, $47 million of unrecognized compensation cost related to performance-based awards and $31 million of unrecognized compensation cost related to the restricted stock awards is expected to be recognized primarily through the first quarter of 2024.