On May 16, 2013, the Compensation Committee of the Company’s Board of Directors (the “Board”) approved the Gentherm Incorporated 2013 Equity Incentive Plan (the “2013 Plan”), covering 3,500,000 shares of our Common Stock. The 2013 Plan was amended on May 19, 2017 to increase the number of available shares by 2,000,000 and further amended on May 21, 2020 to increase the number of available shares by 2,450,000. The 2013 Plan permits the granting of various awards including stock options (including both nonqualified options and incentive options), stock appreciation rights (“SARs”), restricted stock and restricted stock units, performance shares and certain other awards to employees, outside directors and consultants and advisors of the Company. All shares of our Common Stock that remained available for issuance under the Amended and Restated 2006 Stock Incentive Plan (the “2006 Plan”) and the Gentherm Incorporated 2011 Equity Incentive Plan (the “2011 Plan), were reduced to zero; however, some options under the 2006 Plan are still outstanding. As of December 31, 2020, the Company had an aggregate of 3,021,451 shares of Common Stock available to issue under the 2013 Plan. All equity plans are administered by the Compensation Committee of the Board.

During the three-year period ended December 31, 2020, the Company has outstanding stock options, SARs, restricted stock awards and restricted stock units to employees, directors and consultants. These awards become available to the recipient upon the satisfaction of a vesting condition, either based on a period of service or based on the performance of a specific achievement. For equity-based awards with a service condition, the requisite service period typically ranges between three to four years for employees and consultants and one year for directors. As of December 31, 2020, there were 315,834 performance-based restricted stock units (“PSUs”) outstanding. These awards cliff vest after three-years based on the Company’s achievement of either a target return on invested capital ratio (“ROIC”), as defined in the award agreement, for a specified fiscal year, or the Company’s common stock market price returning a target total shareholder return (“TSR”), as defined, during a specific three-year measurement period. Approximately one-half of the PSUs are earned based on the ROIC condition, while the other one-half are earned based on the TSR condition. In each case, awards will be earned at 50% of the target number of shares for achieving a minimum threshold or up to 200% of the target number of shares for exceeding the target, with a linear adjustment between threshold and target or between target and stretch performance goals. All other outstanding, unvested equity-based awards were service based. Equity-based award vesting may be accelerated at the discretion of the Board under conditions specified in the applicable plan.

Under FASB ASC Topic 718, the provisions of the PSUs that vest upon the achievement of relative TSR are considered a market condition, and therefore the effect of that market condition is reflected in the grant date fair value for this portion award. A third party was engaged to complete a “Monte Carlo simulation” to account for the market condition. That simulation takes into account the beginning stock price of our common stock, the expected volatilities for the TSR comparator group, the expected volatilities for the Company’s stock price, correlation coefficients, the expected risk-free rate of return and the expected dividend yield of the Company and the comparator group. The single grant-date fair value computed by this valuation method is recognized by the Company in accounting for the awards regardless of the actual future outcome of the relative TSR feature. The grant date fair value of the other PSUs and RSUs are calculated as the closing price of our common stock as quoted on Nasdaq on the grant date multiplied by the number of shares subject to the award. ROIC is considered a performance condition and the grant-date fair value for ROIC PSUs corresponds with management's expectation of the probable outcome of the performance condition as of the grant date.

Total unrecognized compensation cost related to non-vested options, restricted stock, restricted stock units and PSUs outstanding under all of the Company’s equity plans was $13,604 and $13,168 as of December 31, 2020 and 2019, respectively. That cost is expected to be recognized over a weighted average period of two years. Compensation expense for the years ended December 31, 2020, 2019 and 2018 was $14,323, $8,589 and $12,177, respectively, and the related deferred tax benefit was $3,002, $1,573 and $2,434, respectively. If Gentherm were to realize expired shared-based payment arrangements, they would be reported as a forfeit in the activity roll forward tables below.

The following table summarizes stock option activity during the years ended December 31, 2020, 2019 and 2018:

Options	Shares			Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term		Aggregate Intrinsic Value
Outstanding at December 31, 2017		2,652,142		$	35.34		4.76	$	6,964
Granted		—			—
Exercised		(615,358	)		24.01
Forfeited		(383,784	)		39.59
Outstanding at December 31, 2018		1,653,000		$	38.53		4.28	$	3,610
Granted		—			—
Exercised		(428,250	)		38.66
Forfeited		(355,750	)		39.99
Outstanding at December 31, 2019		869,000		$	37.87		3.51	$	5,172
Granted		—			—
Exercised		(434,250	)		38.12
Forfeited		(6,750	)		38.05
Outstanding at December 31, 2020		428,000		$	37.61		3.20	$	11,815
Exercisable at December 31, 2020		338,625		$	37.87		3.11	$	9,261

The fair value of each option is estimated on the date of grant using the Black-Scholes option-pricing model in order to measure the compensation cost associated with the award. This model incorporates certain assumptions for inputs including a risk-free interest rate, expected dividend yield of the underlying Common Stock, expected option life and expected volatility in the market value of the underlying Common Stock.

Expected volatilities are based on the historical volatility of the Company’s Common Stock. The Company uses historical exercise data and several other factors in developing an assumption for the expected lives of stock options, including the average holding period of outstanding options and their remaining terms. The risk-free interest rate is based upon quoted market yields for United States Treasury debt securities. The expected dividend yield is based upon the Company’s history of having never issued a dividend, the limitations to issue a dividend under terms of the Amended Credit Agreement and management’s current expectation regarding future dividends. We do not expect any of the options granted to be forfeited for purposes of computing fair value.

There were no stock options granted during the years ended December 31, 2020, 2019 and 2018. The total intrinsic value of options exercised during the years ended December 31, 2020, 2019 and 2018 was $5,317, $1,681 and $5,061, respectively.

The following table summarizes restricted stock activity during the years ended December 31, 2020, 2019 and 2018:

Unvested Restricted Shares	Shares			Weighted-Average Grant Date Fair Value
Outstanding at December 31, 2017		282,100		$	38.06
Granted		21,681			35.00
Vested		(130,684	)		38.62
Forfeited		(36,531	)		37.60
Outstanding at December 31, 2018		136,566		$	37.16
Granted		19,920			40.16
Vested		(91,566	)		37.09
Forfeited		(30,000	)		38.05
Outstanding at December 31, 2019		34,920		$	38.31
Granted		32,406			39.96
Vested		(32,420	)		38.33
Forfeited		—			—
Outstanding at December 31, 2020		34,906		$	39.82

The compensation cost associated with restricted shares is estimated on the date of grant using quoted market prices (Level 1 input). The total fair value of restricted shares vested in 2020, 2019 and 2018 was $1,499, $3,697 and $4,599, respectively.

The following table summarizes restricted stock unit activity during the years ended December 31, 2020, 2019 and 2018:

				Performance-Based Awards
Unvested Restricted Stock Units	Time Vesting Shares			ROIC Target Shares			TSR Target Shares			Total
Outstanding at December 31, 2017		—			—			—			—
Granted		86,392			64,785			64,792			215,969
Vested		—			—			—			—
Forfeited		—			—			—			—
Outstanding at December 31, 2018		86,392			64,785			64,792			215,969
Granted		107,391			56,380			56,375			220,146
Vested		(23,956	)		—			—			(23,956	)
Forfeited		(28,086	)		(26,124	)		(26,128	)		(80,338	)
Outstanding at December 31, 2019		141,741			95,041			95,039			331,821
Granted		132,864			77,967			77,967			288,798
Vested		(50,953	)		—			—			(50,953	)
Forfeited		(14,747	)		(15,090	)		(15,090	)		(44,927	)
Outstanding at December 31, 2020		208,905			157,918			157,916			524,739

The total intrinsic value of restricted stock units vested during the years ended December 31, 2020, 2019 and 2018 was $2,214, $1,000 and $0, respectively.

The following table summarizes SARs activity during the years ended December 31, 2020, 2019 and 2018:

Stock Appreciation Rights	Shares			Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term		Aggregate Intrinsic Value
Outstanding at December 31, 2017		1,192,350		$	38.17		4.36	$	2,278
Granted		—			—
Exercised		(204,250	)		26.35
Forfeited		—			—
Outstanding at December 31, 2018		988,100		$	40.61		3.57	$	2,064
Granted		—			—
Exercised		(179,500	)		32.84
Forfeited		(254,350	)		42.63
Outstanding at December 31, 2019		554,250		$	39.41		2.84	$	2,981
Granted		—			—
Exercised		(342,150	)		38.22
Forfeited		(40,500	)		44.39
Outstanding at December 31, 2020		171,600		$	40.60		2.44	$	4,224
Exercisable at December 31, 2020		131,350		$	41.39		2.22		3,131

The total intrinsic value of SARs exercised during the years ended December 31, 2020, 2019 and 2018 was $4,164, $1,588 and $3,532, respectively.