INCENTIVE PLANS

12 Months Ended

Dec. 31, 2021

Share-based Payment Arrangement [Abstract]

International Paper had an Incentive Compensation Plan (“ICP”) prior to the spin-off. The ICP authorizes grants of restricted stock, restricted or deferred stock units, performance awards payable in cash or stock upon the attainment of specified performance goals, dividend equivalents, stock options, stock appreciation rights, other stock-based awards and cash-based awards at the discretion of the Management Development and Compensation Committee of the Board of Directors of International Paper (the “Committee”) that administers the ICP. Stock-based compensation expense in prior years and until the spin-off on October 1, 2021, includes expense attributable to us based on the awards and terms previously granted to our employees and an allocation of International Paper’s corporate and shared functional expenses.

Adopted subsequent to the spin-off, Sylvamo’s Long-Term Incentive Plan (“LTIP”) grants certain employees, consultants, or non-employee directors of the Company different forms of awards, including stock options and restricted stock units. The equity and incentive plan has a maximum shares reserve for the grant of 4,410,725 shares. On October 15, 2021, Sylvamo granted 664,569 restricted stock units to our employees, some of who previously participated in incentive compensation plans sponsored by International Paper. As of December 31, 2021, 3,746,156 shares remain available for future grants.

The following summarizes restricted stock unit activity for employees for the period from the October 1, 2021 date of spin-off through December 31, 2021:


	Shares	Weighted Average Grant Date Fair Value
Outstanding as of October 1, 2021	—	—
Granted	664,569	28.51
Shares issued	—	—
Forfeited	—	—
Outstanding as of December 31, 2021	664,569	$	28.51

Total stock-based compensation cost and the associated income tax benefits recognized by the Company in the consolidated and combined statements of operations were as follows:


In millions	2021		2020		2019
Total stock-based compensation expense (included in selling and administrative expense)	$	14	$	15	$	19
Income tax benefit (expense) related to stock-based compensation	$	3	$	1	$	1

As of December 31, 2021, $14 million of compensation cost, net of estimated forfeitures, related to all stock-based compensation arrangements for Company employees had not yet been recognized. This amount will be recognized in expense over a weighted-average period of 1.1 years.