Stock-Based Compensation

12 Months Ended

Dec. 31, 2022

Share-Based Payment Arrangement [Abstract]

As of November 9, 2009, the Company adopted the Lear Corporation 2009 Long-Term Stock Incentive Plan (as amended, the "2009 LTSIP"). The 2009 LTSIP reserved 11,815,748 shares of common stock for issuance under stock option, restricted stock, restricted stock unit, restricted unit, performance share, performance unit and stock appreciation right awards. As of May 16, 2019, the Company adopted the Lear Corporation 2019 Long-Term Stock Incentive Plan (the "2019 LTSIP"), after which no awards will be issued under the 2009 LTSIP. The 2019 LTSIP reserves 2,526,858 shares of common stock plus shares of common stock awarded under the 2009 LTSIP that are cancelled subsequent to May 16, 2019, for issuance under stock option, restricted stock, restricted stock unit, restricted unit, performance share, performance unit and stock appreciation right awards. In addition, the Company adopted the Lear Corporation 2019 Inducement Grant Plan ("Inducement Plan") as of April 17, 2019, in conjunction with the Xevo acquisition. The Inducement Plan reserved 146,516 shares of common stock for issuance under restricted stock and restricted stock unit awards, of which 145,202 awards were granted on April 17, 2019. The remaining shares under the Inducement Plan will not be awarded.

Under the 2009 LTSIP, the 2019 LTSIP and the Inducement Plan, the Company has granted restricted stock units, performance shares and stock options to certain of its employees, all of which generally vest in one to three years following the grant date. For the years ended December 31, 2022, 2021 and 2020, the Company recognized compensation expense related to these awards of $50.3 million, $58.7 million and $39.0 million, respectively. Unrecognized compensation expense related to these awards of $58.7 million will be recognized over the next 1.6 years on a weighted average basis. In accordance with the provisions of the awards, the Company withholds shares from the settlement of such awards to cover minimum statutory tax withholding requirements. The withheld shares are classified as common stock held in treasury in the accompanying consolidated balance sheets as of December 31, 2022 and 2021.

A summary of restricted stock units, performance shares and stock options for the year ended December 31, 2022, is shown below:


	Restricted Stock Units	Weighted Average Grant Date Fair Value	Performance Shares	Weighted Average Grant Date Fair Value	Stock Options	Weighted Average Grant Date Fair Value
Outstanding as of December 31, 2021	567,891	$129.58	780,544	$156.56	202,702	$32.65
Granted	189,213	$164.57	244,717	$196.83	—
Distributed (vested)	(242,307)		(104,551)		—
Cancelled	(20,336)		(194,225)		—
Outstanding as of December 31, 2022 (1)	494,461	$145.64	726,485	$201.83	202,702	$32.65

Vested or expected to vest as of December 31, 2022	494,461		435,217		202,702

(1) Outstanding performance shares are reflected at the maximum possible payout that may be earned during the relevant performance periods.

The grant date fair value of restricted stock units is based on the share price on the grant date. The weighted average grant date fair value of restricted stock units granted in 2021 and 2020 was $165.28 and $129.40, respectively. The grant date fair value of performance shares is based on the share price on the grant date or a Monte Carlo simulation. The weighted average grant date fair value of performance shares granted in 2021 and 2020 was $188.11 and $147.53, respectively. The grant date fair value of stock options is based on a Black-Scholes model. The grant date fair value of options granted in 2021 and 2020 was $35.33 and $30.32, respectively.