Share-based Compensation

3 Months Ended

Mar. 31, 2021

Share-based Payment Arrangement [Abstract]

The Corporation maintains share-based compensation plans under which it periodically grants share-based awards for a fixed number of shares to directors and certain officers of the Corporation.

Before the TCF/Chemical Merger, Chemical and Legacy TCF granted share-based awards under their respective share-based compensation plans, including the Chemical Stock Incentive Plan of 2019 (the "Stock Incentive Plan of 2019") and the TCF Financial 2015 Omnibus Incentive Plan (the "Legacy TCF Omnibus Incentive Plan"). At March 31, 2021, there were 1,029,723 shares reserved for issuance under the Legacy TCF Omnibus Incentive Plan and there were 639,366 shares reserved for issuance under the Stock Incentive Plan of 2019.

The fair value of share-based awards is recognized as compensation expense over the requisite service or performance period. Compensation expense for share-based awards, including the merger-related share-based compensation expense was $6.2 million for the three months ended March 31, 2021 and $4.7 million for the same period in 2020. The excess tax realized from share-based compensation transactions during the three months ended March 31, 2021 was a benefit of $161 thousand and a benefit of $677 thousand for the same period in 2020.

Restricted Stock Units

The Corporation can grant performance-based restricted stock units ("PRSUs") and time-based restricted stock units ("TRSUs") (collectively referred to as "RSUs") under the Stock Incentive Plan of 2019 and the Legacy TCF Omnibus Incentive Plan; provided, that, RSUs granted under the Legacy TCF Omnibus Incentive Plan may only be granted to new employees hired after the merger or employees who previously were employees of Legacy TCF. At March 31, 2021, there were 306,190 PRSUs outstanding dependent on achieving certain performance target levels and the grantee completing the requisite service period. The TRSUs vest upon satisfaction of a service condition. Upon achievement of the satisfaction of a service condition and/or performance target level, as applicable, the TRSUs are converted into shares of TCF Financial's common stock on a one-to-one basis and the PRSUs are converted into shares of TCF Financial's common stock in accordance with the achievement of the performance target (ranging from 0% to 150% of the granted PRSUs). Compensation expense related to RSUs is recognized over the expected requisite performance or service period, as applicable.

A summary of the activity for RSUs at and for the three months ended March 31, 2021 is presented below:


	Number of Units	Weighted-average Grant Date Fair Value Per Unit
Outstanding at December 31, 2020	2,015,514	$	31.25

Granted	686,885	47.41


Forfeited/canceled	(56,707)	32.93
Vested	(121,476)	45.07
Outstanding at March 31, 2021	2,524,216	$	34.94

Unrecognized compensation expense related to RSUs totaled $66.8 million at March 31, 2021 and is expected to be recognized over the remaining weighted-average period of 3.1 years.

Restricted Stock Awards

The Corporation's restricted stock award transactions were as follows:


	Number of Awards	Weighted-Average Grant Date Fair Value Per Award
Outstanding at December 31, 2020	505,162	$	38.57


Granted	27,417	47.41

Forfeited/canceled	(3,983)	40.48
Vested	(50,264)	40.38
Outstanding at March 31, 2021	478,332	$	38.88

At March 31, 2021, there were no shares of performance-based restricted stock awards outstanding. Unrecognized stock compensation expense for restricted stock awards was $7.9 million at March 31, 2021 with a weighted-average remaining amortization period of 1.6 years.

The following table provides information regarding total expense for restricted stock awards:


	Three Months Ended March 31,
(In thousands)	2021		2020
Restricted stock expense related to employees(1)	$	5,692	$	4,724
Restricted stock expense related to directors(2)	470		—
Total restricted stock expense	$	6,162	$	4,724

(1)Included in "Compensation and employee benefits" in the Consolidated Statements of Income.

(2)Included in "Other noninterest expense" in the Consolidated Statements of Income.

Stock Options

A summary of activity for the Corporation's stock options at and for the three months ended March 31, 2021 is presented below:


	Non-Vested Stock Options Outstanding			Stock Options Outstanding
	Number of Options	Weighted-average Exercise Price		Number of Options	Weighted-average Exercise Price
Outstanding at December 31, 2020	55,722	$	41.23	401,636	$	31.69


Exercised	—	—		(156,347)	27.74
Forfeited/canceled	(135)	53.72		—	—

Vested	(43,272)	38.00		43,272	38.00
Outstanding at March 31, 2021	12,315	$	52.46	288,561	$	35.05
Exercisable/vested at March 31, 2021				288,561	$	35.05

The weighted-average remaining contractual term was 4.3 years for all outstanding stock options and 4.2 years for exercisable stock options at March 31, 2021.