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Stock-Based Compensation Plans

12 Months Ended

Dec. 31, 2021

Note 12. Stock-Based Compensation Plans

We grant stock-based compensation to our employees and directors. At December 31, 2021, an aggregate of 1,958,281 shares were authorized for future grant under our various stock-based compensation plans, including stock options, restricted stock units and stock awards. Awards that expire or are canceled without delivery of shares and shares withheld related to net share settlements generally become available for issuance under the plans. As stock options are exercised and restricted stock units vest, we issue new shares of Reliance common stock.

On May 20, 2020, our stockholders approved an amendment to the Reliance Steel & Aluminum Co. Amended and Restated 2015 Incentive Award Plan to, in part, increase the number of shares available for issuance under the plan by 1.5 million. In addition, our stockholders approved extending the term of the Reliance Steel & Aluminum Co. Directors Equity Plan for ten years until December 31, 2030.

Stock Options

Stock option activity was as follows:




	Option	Weighted Average
Stock Options	Shares	Exercise Price
Outstanding at January 1, 2019	26,000	$	41.76
Exercised	(20,000)		40.80
Outstanding at December 31, 2019	6,000		44.99
Exercised	(6,000)		44.99
Outstanding and exercisable at December 31, 2020 and 2021	—	$	—

There were no stock options granted or exercised during 2021. The proceeds and intrinsic values of stock options exercised in 2020 were $0.3 million and $0.4 million, respectively. The proceeds and intrinsic values of stock options exercised in 2019 were $0.8 million and $1.0 million, respectively.

Restricted Stock Units

In 2021, 2020 and 2019, we granted to key employees equity awards consisting of service-based restricted stock units (“RSUs”) and performance-based restricted stock units (“PSUs”) in aggregate amounts of 318,495 units, 540,547 units and 488,345 units, respectively. Each RSU and PSU includes a service-based condition and consists of a right to receive shares of our common stock and dividend equivalent rights, subject to forfeiture, equal to the accrued cash or stock dividends where the record date for such dividends is after the grant date but before the award is settled. In 2021, 2020 and 2019, we granted 191,139, 330,144, and 294,190 RSUs, respectively, that provide the right to receive one share of our common stock and cliff vest at December 1, 2023, December 1, 2022 and December 1, 2021, respectively, if the recipient is an employee of the Company on those dates. Additionally, in 2021, 2020 and 2019, we granted 127,356, 210,403 and 194,155 PSUs, respectively, that included performance goals and the right to receive a maximum of two shares of our common stock and vest only upon the satisfaction of the service-based condition and certain performance targets for the three-year periods ending December 31, 2023, December 31, 2022 and December 31, 2021, respectively. The fair value of the 2021, 2020 and 2019 RSUs and PSUs granted were $141.41 per share, $82.81 per share and $88.05 per share, respectively, determined based on the closing price of our common stock on the grant date.

In 2021, 2020 and 2019, we granted 6,248; 12,807; and 11,640 stock awards, respectively, to the non-employee members of the Board of Directors pursuant to the Directors Equity Plan. The fair value of the stock awards granted in

2021, 2020 and 2019, was $166.39 per share, $91.30 per share and $89.34 per share, respectively, determined based on the closing price of our common stock on the grant date. The awards are fully vested on the grant date.

In 2021, 2020 and 2019, we made payments of $21.2 million, $23.1 million and $16.2 million, respectively, to tax authorities on our employees’ behalf for shares withheld related to net share settlements. These payments are reflected in the Stock-based compensation, net caption of the consolidated statements of equity.

A summary of the status of our unvested RSUs and PSUs as of December 31, 2021 and changes during the year then ended is as follows:


		Weighted
		Average
		Grant Date			Aggregate
		Fair Value			Fair Value
	RSUs and PSUs	Per RSU			(in millions)
Unvested at January 1, 2021	995,720	$	85.27
Granted	318,495		141.41
Vested	(462,642)		88.02
Canceled or forfeited	(19,976)		90.26
Unvested at December 31, 2021	831,597	$	105.12	$	188.8

The fair value as of the respective vesting dates of RSUs and PSUs during 2021, 2020 and 2019 was $126.0 million, $54.0 million and $56.5 million, respectively. PSUs vested during 2021 include 376,090 equivalent shares our common stock with a fair value of $61.0 million that settled in February 2022.

Unrecognized Compensation Cost and Tax Benefits

As of December 31, 2021, there was $65.9 million of total unrecognized compensation cost related to unvested stock-based compensation awards granted under all stock-based compensation plans. That cost is expected to be recognized over a weighted average period of 1.6 years.

The tax benefit realized from our stock-based compensation plans in 2021, 2020 and 2019 was $6.8 million, $6.1 million and $5.5 million, respectively.