STOCK INCENTIVE PLANS

3 Months Ended

Mar. 31, 2022

Share-based Payment Arrangement [Abstract]

Restricted Stock

We issue restricted stock awards to key employees under our Incentive Compensation Plan (Plan). We issue time-based awards and performance-based awards under this Plan, both of which are based on a three-year vesting period. The grant date fair value of the time-based awards is equal to the price of our common stock on the grant date. The fair value of the performance-based awards is based on a Monte-Carlo simulation valuation of our common stock as of the grant date. The assumptions used for this valuation include stock price volatility, risk-free interest rate and dividend yield. We granted 495,844 and 542,136 restricted stock units during the three months ended March 31, 2022 and 2021, respectively, including 297,508 and 325,284 performance-based restricted stock units during those same periods, respectively. As of March 31, 2022, we had available up to 3,909,215 shares of common stock to issue under this Plan.

The unvested restricted stock unit awards are eligible to receive cash dividends or dividend equivalents which are ultimately used to purchase additional shares of stock and are subject to forfeiture if the requisite service period is not completed or the specified performance criteria are not met. These awards are subject to certain accelerated vesting provisions upon retirement, death, disability or in the event of a change of control as defined in the award agreements.

The following table summarizes the activity relating to restricted stock units during the periods indicated:

TABLE 13.1


	Three Months Ended March 31,
	2022			2021
	Units	Weighted Average Grant Price per Share		Units	Weighted Average Grant Price per Share
Unvested units outstanding at beginning of period	4,680,786	$	9.71	4,322,115	$	9.46
Granted	495,844	14.22		542,136	12.61
Acquired	60,300	9.41		—	—
Net adjustment due to performance	—	—		327,256	11.84
Vested	(216,373)	8.77		(142,687)	7.29
Forfeited/expired/canceled	(18,239)	9.34		(8,334)	7.52
Dividend reinvestment	46,696	12.85		42,310	13.43
Unvested units outstanding at end of period	5,049,014	10.22		5,082,796	10.05

The following table provides certain information related to restricted stock units:

TABLE 13.2


(in millions)	Three Months Ended March 31,
	2022		2021
Stock-based compensation expense	$	9	$	12
Tax benefit related to stock-based compensation expense	2		3
Fair value of units vested	3		1

As of March 31, 2022, there was $7.5 million of unrecognized compensation cost related to unvested restricted stock units, including $0.9 million that is subject to accelerated vesting under the Plan’s immediate vesting upon retirement.

The components of the restricted stock units as of March 31, 2022 are as follows:

TABLE 13.3


(dollars in millions)	Service- Based Units		Performance- Based Units		Total
Unvested restricted stock units	2,971,430		2,077,584		5,049,014
Unrecognized compensation expense	$	7	$	1	$	8
Intrinsic value	$	37	$	26	$	63
Weighted average remaining life (in years)	1.71		1.52		1.63

Stock Options

All outstanding stock options were assumed from acquisitions and are fully vested. Upon consummation of our acquisitions, all outstanding stock options issued by the acquired companies were converted into equivalent FNB stock options. We issue shares of treasury stock or authorized but unissued shares to satisfy stock options exercised.

As of March 31, 2022, we had 176,602 stock options outstanding and exercisable at a weighted average exercise price per share of $8.96, compared to 182,747 stock options outstanding and exercisable at a weighted average exercise price per share of $8.86 as of March 31, 2021.

The intrinsic value of outstanding and exercisable stock options at March 31, 2022 was $0.6 million. The aggregate intrinsic value represents the amount by which the fair value of underlying stock exceeds the option exercise price.