The Company's share-based awards are typically granted annually at its regularly scheduled first quarter Compensation Committee meeting. For the years presented herein, employee awards were made pursuant to the terms of the Company's 2021 Omnibus Incentive Plan (the "2021 Plan") and 2012 Equity and Cash Incentive Plan (the "2012 Plan").

On May 7, 2021, the shareholders approved the 2021 Plan, to replace the 2012 Plan, which otherwise would have terminated according to its terms on May 3, 2022. Upon approval of the 2021 Plan, no additional awards could be granted under the 2012 Plan, and the remaining 4,888,197 shares available for additional award grant purposes under the former 2012 Plan became available for issuance under the 2021 Plan. The 2021 Plan provides for stock options and stock-settled appreciation rights ("SARs"), restricted stock awards, restricted stock unit awards, performance share awards, cash performance awards, directors' shares and deferred stock units. Under the 2021 Plan, a total of 8,300,000 newly authorized shares of common stock are reserved for issuance, resulting in a total of 13,188,197 authorized shares available for issuance. These shares are subject to adjustments resulting from stock dividends, stock splits, recapitalizations, reorganizations and other similar changes.

Under the 2012 Plan, which was approved by shareholders on May 3, 2012 to replace the 2005 Equity and Cash Incentive Plan (the "2005 Plan"), a total of 17,000,000 shares of common stock were reserved for grants (stock options and SARs, restricted stock unit awards, performance share awards, cash performance awards, directors' shares and deferred stock units) to key personnel. Of these 17,000,000 shares, 4,888,197 shares remained available under the 2012 Plan as of the date that shareholders approved the 2021 Plan, and those remaining shares became available for issuance under the 2021 Plan.

Officers and other key employees, as well as non-employee directors, are eligible to participate in the 2021 Plan, and were also eligible under the 2012 Plan, which had a ten-year term between May 3, 2012 to May 3, 2022.

Stock-based compensation costs are reported within selling, general and administrative expenses in the Consolidated Statements of Earnings. The following table summarizes the Company’s compensation expense relating to all stock-based incentive plans:


	Years Ended December 31,
	2021		2020		2019
Pre-tax stock-based compensation expense	$	31,111	$	25,026	$	29,702
Tax benefit	(2,859)		(2,731)		(2,490)
Total stock-based compensation expense, net of tax	$	28,252	$	22,295	$	27,212

The exercise price per share for SARs is equal to the closing price of the Company’s stock on the New York Stock Exchange on the date of grant. New common shares are issued when SARs are exercised. The period during which SARs are exercisable is fixed by the Company’s Compensation Committee at the time of grant. Generally, the SARs vest after three years of service and expire at the end of ten years.

In 2021, 2020 and 2019, the Company issued SARs covering 413,173, 390,780 and 615,089 shares, respectively. The fair value of each SAR grant was estimated on the date of grant using a Black-Scholes option-pricing model with the following assumptions:


	2021		2020		2019
Risk-free interest rate	0.59	%	1.44	%	2.51	%
Dividend yield	1.62	%	1.65	%	2.13	%
Expected life (years)	5.5		5.5		5.6
Volatility	30.49	%	22.76	%	22.35	%
Grant price	$122.73		$119.86		$91.20
Fair value at date of grant	$29.08		$22.54		$17.55

Expected volatilities are based on Dover's stock price history, including implied volatilities from traded options on Dover stock. The Company uses historical data to estimate SAR exercise and employee termination patterns within the valuation

model. The expected life of SARs granted is derived from the output of the option valuation model and represents the average period of time that SARs granted are expected to be outstanding. The interest rate for periods within the contractual life of the awards is based on the U.S. Treasury yield curve in effect at the time of grant.


	SARs
	Number of Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)
Outstanding at January 1, 2021	2,979,933	$	79.36
Granted	413,173	122.73


Forfeited / expired	(89,899)	110.58
Exercised	(925,823)	69.99
Outstanding at December 31, 2021	2,377,384	89.49		6.5

Exercisable at December 31, 2021	1,125,435	$	67.69	4.8


	SARs Outstanding						SARs Exercisable
Range of Exercise Prices	Number of Shares	Weighted Average Exercise Price		Weighted Average Remaining Life in Years	Aggregate Intrinsic Value		Number of Shares	Weighted Average Exercise Price		Weighted Average Remaining Life in Years	Aggregate Intrinsic Value
$48.28 - $82.51	1,125,435	$	67.69	4.8	$	128,213	1,125,435	$	67.69	4.8	$	128,213
$84.94 - $119.86	868,923	$	103.04	7.5	68,262		—	$	—	0	—
$122.73 - $155.65	383,026	$	122.82	9.1	22,516		—	$	—	0	—
	2,377,384				$	218,991	1,125,435				$	128,213

Other information regarding the exercise of SARs is listed below:


	2021		2020		2019
Fair value of SARs that became exercisable	$	10,199	$	8,585	$	8,611
Aggregate intrinsic value of SARs exercised	$	62,895	$	55,031	$	89,473

Performance share awards granted are expensed over the three-year requisite performance and service period. Awards become vested if (1) the Company achieves certain market conditions or specified internal metrics and (2) the employee remains continuously employed by the Company during the performance period. Partial vesting may occur after separation from service in the case of certain terminations not for cause and for retirements.

The performance share awards granted in 2021 and 2020 are market condition awards as attainment is based on Dover's performance relative to its peer group (companies listed under the S&P 500 Industrials sector) for the relevant performance period. The performance period and vesting period for these awards is approximately three years. These awards were valued on the date of grant using the Monte Carlo simulation model (a binomial lattice-based valuation model), and are generally recognized ratably over the vesting period, and the fair value is not subject to change based on future market conditions. The assumptions used in determining the fair value of the performance shares granted in 2021 and 2020 were as follows:


	2021		2020
Risk-free interest rate	0.19	%	1.40	%
Dividend yield	1.62	%	1.65	%
Expected life (years)	2.9		2.9
Volatility	31.90	%	23.30	%

Grant price	$122.73		$119.86
Fair value per share at date of grant	$148.29		$165.71

The performance share awards granted in 2019 are considered performance condition awards as attainment is based on Dover's performance relative to established internal metrics. The fair value of these awards was determined using Dover's closing stock price on the date of grant. The expected attainment of the internal metrics for these awards is analyzed each reporting period, and the related expense is adjusted up or down based on expected attainment, if that attainment differs from previous estimates. The cumulative effect on current and prior periods of a change in attainment is recognized in selling, general and administrative expenses in the Consolidated Statements of Earnings in the period of change.

A summary of activity for performance share awards for the year ended December 31, 2021 is as follows:


	Number of Shares	Weighted Average Grant-Date Fair Value
Unvested at January 1, 2021	77,979	$	138.14
Granted	50,371	148.29



Vested	(27,031)	91.37
Unvested at December 31, 2021	96,129	$	156.88

The Company also has restricted stock authorized for grant. Common stock of the Company may be granted at no cost to certain officers and key employees. In general, restrictions limit the sale or transfer of these shares during a three-year period, and restrictions lapse proportionately over the three-year period. The Company granted 87,177, 83,512 and 124,929 of restricted stock units in 2021, 2020 and 2019, respectively. The fair value of these awards was determined using Dover's closing stock price on the date of grant, which were $122.73, $119.86, and $91.20 in 2021, 2020 and 2019, respectively.

A summary of activity for restricted stock units for the year ended December 31, 2021 is as follows:


	Number of Shares	Weighted Average Grant-Date Fair Value
Unvested at January 1, 2021	252,907	$	93.43
Granted	87,177	122.73


Forfeited	(10,741)	114.85
Vested	(126,661)	91.75
Unvested at December 31, 2021	202,682	$	107.03