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Stock-Based Compensation Plans
 12 Months Ended
Dec. 31, 2020
Share-based Payment Arrangement [Abstract]  
Stock-Based Compensation Plans STOCK-BASED COMPENSATION PLANS
At December 31, 2020, the Company had two equity incentive plans under which awards are made, which include the Gentex Corporation 2019 Omnibus Incentive Plan ("2019 Omnibus Plan"), and an employee stock purchase plan. Those plans and any material amendments thereto have previously been approved by shareholders.

The 2019 Omnibus Plan provides for the potential awards to: i) employees; and ii) non-employee directors of the Company or its subsidiaries, which potential awards may be stock options, both incentive stock options and non-qualified stock options, appreciation rights, restricted stock, restricted stock units, performance share awards and performance units, and other awards that are stock-based, cash-based or a combination of both. The 2019 Omnibus Plan replaced the Company's Employee Stock Option Plan, Second Restricted Stock Plan, and Amended and Restated Non-Employee Director Stock Option Plan (the "Prior Plans"), which were also approved by shareholders. Any existing awards previously granted under the Prior Plans remain outstanding in accordance with their terms and are governed by the Prior Plans as applicable.

2019 Omnibus Incentive Plan

The 2019 Omnibus Plan covers 45,000,000 shares of common stock. The purpose of the 2019 Omnibus Plan is to attract and retain employees, officers, and directors of the Company and its subsidiaries and to motivate and provide such persons incentives and rewards for performance. As of December 31, 2020, 9,868,580 shares (net of shares from canceled/expired options) have been issued under the 2019 Omnibus Plan, which includes stock options (at a set conversion rate), restricted shares, and performance share awards.
Employee Stock Options
The Employee Stock Option Plan allowed the Company to grant up to 24,000,000 shares of common stock under the plan, prior to its replacement by the 2019 Omnibus Plan.
The Company has granted options on 2,212,301 shares (net of shares from canceled/expired options) under the 2019 Omnibus Plan and 12,778,967 shares (net of shares from canceled/expired options) under the prior plan (prior to its replacement) through December 31, 2020. Under each of such plans, the option exercise price equals the stock’s market price on date of grant. The options vest after one to five years, and expire after five to ten years.

The fair value of each option grant was estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions for the indicated periods:
202020192018
Dividend yield (1)
2.0 %2.0 %2.1 %
Expected volatility (2)
27.5 %23.9 %26.0 %
Risk-free interest rate (3)
0.3 %1.8 %2.7 %
Expected term of options (in years) (4)
4.24.24.2
Weighted-average grant-date fair value$5 $4 $5 
(1)                Represents the Company's estimated cash dividend yield over the expected term of option grant.
(2)    Amount is determined based on analysis of historical price volatility of the Company's common stock. The expected volatility is based on the daily percentage change in the price of the stock over a period equal to the expected term of the option grant.
(3)                Represents the U.S. Treasury yield over the expected term of the option grant.
(4)    Represents the period of time that options granted are expected to be outstanding. Based on analysis of historical option exercise activity, the Company has determined that all employee groups exhibit similar exercise and post-vesting termination behavior.
As of December 31, 2020, there was $7,220,109 of unrecognized compensation cost related to stock option awards which is expected to be recognized over the remaining vesting periods, with a weighted-average
period of 2.05 years. Stock option expense for the years ended December 31, 2020, 2019 and 2018 was $4,935,527, $6,345,147, and $8,582,489 respectively.
A summary of the status of the Company’s stock option plans at December 31, 2020, 2019 and 2018, and changes during the same periods are presented in the tables below.
 2020
 Shares
(000)		Wtd. Avg.
Ex. Price		Wtd. Avg. 
Remaining
Contract Life		Aggregate
Intrinsic 
Value
(000)
Outstanding at Beginning of Year5,435 $20 
Granted1,571 26 
Exercised(2,077)18 $23,861 
Forfeited(396)22 
Outstanding at End of Year4,533 23 3.4 years$48,501 
Exercisable at End of Year1,358 $20 2.3 years$18,334 

 2019
 Shares
(000)		Wtd. Avg.
Ex. Price		Wtd. Avg. 
Remaining
Contract Life		Aggregate
Intrinsic 
Value
(000)
Outstanding at Beginning of Year8,944 $18 
Granted1,049 25 
Exercised(4,402)16 $36,294 
Forfeited(156)20 
Outstanding at End of Year5,435 20 3.1 years$47,170 
Exercisable at End of Year1,859 $18 2.2 years$20,484 
 
 2018
 Shares
(000)		Wtd. Avg.
Ex. Price		Wtd. Avg. 
Remaining
Contract Life		Aggregate
Intrinsic 
Value
(000)
Outstanding at Beginning of Year11,837 $16 
Granted1,613 22 
Exercised(4,278)15 $38,097 
Forfeited(228)18 
Outstanding at End of Year8,944 18 2.8 years$24,881 
Exercisable at End of Year4,101 $16 1.7 years$16,162 

A summary of the status of the Company’s non-vested employee stock option activity for the years ended December 31, 2020, 2019, and 2018, are presented in the table below: 
 202020192018
 Shares
(000)		Wtd. Avg
Grant
Date
Fair Value		Shares
(000)		Wtd. Avg
Grant
Date
Fair Value		Shares
(000)		Wtd. Avg
Grant
Date
Fair Value
Nonvested Stock Options at Beginning of Year3,575 $4 4,842 $4 6,540 $4 
Granted1,571 5 1,049 4 1,613 5 
Vested(1,585)4 (2,165)4 (3,089)4 
Forfeited(386)4 (151)4 (222)4 
Nonvested Stock Options at End of Year3,175 $5 3,575 $4 4,842 $4 
 
    Restricted Shares
The Company’s Second Restricted Stock Plan provided for a maximum number of shares that may be subject to awards of 9,000,000 shares, prior to its replacement by the 2019 Omnibus Plan.
Restricted shares awarded under either that plan or the 2019 Omnibus Plan entitle the shareholder to all rights of common stock ownership except that the shares may not be sold, transferred, pledged, exchanged or otherwise disposed of during the restriction period. The restriction period is determined by a committee, appointed by the Board of Directors, but may not exceed ten years. The Company has issued 1,603,118 shares under the 2019 Omnibus Plan and 5,688,309 shares under the prior plan (prior to its replacement) as of December 31, 2020, and has 3,598,778 shares outstanding under such plans.
202020192018
Vesting Period(1)
Shares GrantedMarket Price at Grant DateShares GrantedMarket Price at Grant DateShares GrantedMarket Price at Grant Date
1 Year42,074 
22.16 - 26.94
39,627 $22.19 — $— 
2 Year21,669 
23.88 - 26.94
— — — — 
3 Years119,504 
23.88 - 31.08
64,718 20.40 — — 
4 Years479,346 
20.68 - 28.98
773,698 
20.68 - 28.98
762,749 
20.21 - 23.14
5 Years170,355 
20.68 - 28.98
254,988 
20.68 - 28.98
279,420 
20.21 - 23.14
832,948 
$20.68 - 31.08
1,133,031 
$20.40 - 28.98
1,042,169 
$20.21 - 23.14
(1) Each of these awards cliff vest after the restriction period with no additional restrictions.
A summary of restricted share award activity, including award grants, vesting, and forfeitures for the years ended December 31, 2020, 2019, and 2018, are presented in the table below: 
 202020192018
 Shares
(000)		Shares
(000)		Shares
(000)
Nonvested, Beginning of Year3,315 2,638 2,019 
Granted833 1,133 1,042 
Vested(303)(361)(321)
Forfeited(246)(95)(102)
Nonvested, End of Year3,599 3,315 2,638 
As of December 31, 2020, there was unearned stock-based compensation of $39,291,347 associated with these restricted stock grants. The unearned stock-based compensation related to these grants is being amortized to compensation expense over the applicable restriction periods. Amortization expense of restricted stock for the years ended December 31, 2020, 2019 and 2018 was $20,675,447, $13,770,917, and $8,841,985 respectively.

Performance Shares
Performance shares awarded under the 2019 Omnibus Plan are considered performance condition awards as attainment is based on the Company's performance relative to pre-established metrics. The fair value of such performance share awards was determined using the Company's closing stock price on the date of grant. The expected attainment of the metrics for these awards is then analyzed each reporting period, and the related expense is adjusted based on expected attainment, if the then expected attainment differs from previous expectations. The cumulative effect on current and prior periods of a change in expected attainment is recognized in the period of change. As of December 31, 2020, the Company had unearned stock-based compensation of $6,062,139 associated with these performance share grants. The unearned stock-based compensation related to these grants is being amortized to compensation expense over the applicable performance periods. Amortization expense from performance share grants for the years ended December 31, 2020 and 2019 was $4,424,678, and $897,136, respectively. No amortization expense for performance share grants was incurred in 2018, as no such awards were issued or outstanding.
Employee Stock Purchase Plan
In 2013, the Gentex Corporation Employee Stock Purchase Plan covering 2,000,000 shares of common stock was approved by the shareholders, replacing a prior plan. Under such plan, the Company sells shares at 85% of the stock’s market price at the date of purchase. Under ASC 718, the 15% discounted value is recognized as compensation expense. The following table summarizes shares sold to employees under the 2013 Plan in the years ended December 31, 2020, 2019 and 2018:
Plan202020192018Cumulative Shares IssuedWeighted Average Fair Value 2020
2013 Employee Stock Purchase Plan208,273 173,013 177,846 1,354,129 $21.38