Stock Incentive Plans

12 Months Ended

Dec. 31, 2021

Share-based Payment Arrangement [Abstract]

STOCK INCENTIVE PLANS

The Company has one active equity compensation plan from which new grants may be made, the Graphic Packaging Holding Company 2014 Omnibus Stock and Incentive Compensation Plan (the “2014 Plan”). The 2014 Plan allows for granting shares of stock, options, stock appreciation rights, restricted stock, restricted stock units (“RSUs”), restricted stock awards (“RSAs”), and other types of stock-based and cash awards. Awards under the 2014 Plan vest and expire in accordance with terms established at the time of grant. Shares issued pursuant to awards under the 2014 Plan are from GPHC’s authorized but unissued shares. Compensation costs are recognized on a straight-line basis over the requisite service period of the award and are adjusted for actual performance for performance-based awards. As of December 31, 2021, there were 11.6 million shares remaining available to be granted under the 2014 Plan.

Stock Awards, Restricted Stock and Restricted Stock Units

Under the 2014 Plan, all RSUs granted to employees generally vest and become payable in three years from date of grant. RSUs granted to employees generally contain some combination of service and performance objectives based on various financial targets and relative total shareholder return that must be met for the RSUs to vest. RSUs granted as deferred compensation for non-employee directors are fully vested but not payable until the distribution date elected by the director. RSAs issued to non-employee directors as part of their compensation for service on the Board are unrestricted on the grant date.

Data concerning RSUs and RSAs granted during the years ended December 31 is as follows:


	2021		2020		2019
RSUs — Employees	1,680,997		1,655,854		2,187,603
Weighted-average grant date fair value	$	16.14	$	15.40	$	12.37
Stock Awards — Board of Directors	55,055		71,160		74,760
Weighted-average grant date fair value	$	17.80	$	13.49	$	12.84

A summary of the changes in the number of unvested RSUs from December 31, 2018 to December 31, 2021 is presented below:


	RSUs	Weighted Average Grant Date Fair Value
Outstanding — December 31, 2018	4,460,034	$	13.27
Granted(a)	2,187,603	12.37
Released	(900,516)	12.00
Forfeited	(187,729)	13.66
Performance adjustment(b)	(499,702)	11.57
Outstanding — December 31, 2019	5,059,690	$	13.27
Granted(a)	1,655,854	15.40
Released	(1,415,365)	12.91
Forfeited	(158,473)	14.25

Outstanding — December 31, 2020	5,141,706	$	14.02
Granted(a)	1,680,997	16.14
Released	(2,121,203)	14.88
Forfeited	(359,100)	14.39
Performance adjustment(b)	587,461	15.09
Outstanding — December 31, 2021	4,929,861	$	14.47

(a) Grant activity for all performance-based RSUs is disclosed at target.

(b) Reflects the number of RSUs above and below target levels based on actual performance measured at the end of the performance period.

The initial value of the service-based RSUs is based on the closing market value of GPHC’s common stock on the date of grant. The 2021 performance-based RSU grants were valued using a Monte Carlo simulation as the total shareholder return contains a market condition. RSUs are recorded in Shareholders' Equity. The unrecognized expense at December 31, 2021 is approximately $31 million and is expected to be recognized over a weighted average period of 2 years.

The value of stock awards granted to the Company's directors are based on the market value of GPHC’s common stock on the date of grant. These awards are unrestricted on the date of grant.

During 2021, 2020, and 2019, $27 million, $34 million and $22 million, respectively, were charged to compensation expense for stock incentive plans and is primarily included in Selling, General and Administrative expenses in the Consolidated Statements of Operations.

During 2021, 2020, and 2019, RSUs with an aggregate fair value of $35 million, $23 million and $11 million, respectively, vested and were paid out. The RSUs vested and paid out in 2021 were granted primarily during 2018.