Stock Compensation Plans

6 Months Ended

Jun. 30, 2023

Share-Based Payment Arrangement [Abstract]

STOCK COMPENSATION PLANS

The Company recorded stock compensation expense as follows for the three and six months ended June 30, 2023 and 2022 (in millions):


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
Cost of goods sold	$	0.5	$	0.3	$	1.0	$	0.6
Selling, general and administrative expenses	12.8		10.3		26.3		17.0
Total stock compensation expense	$	13.3	$	10.6	$	27.3	$	17.6

Stock Incentive Plan

Under the Company’s Long-Term Incentive Plan (the “Plan”), up to 10,000,000 shares of AGCO common stock may be issued. As of June 30, 2023, of the 10,000,000 shares reserved for issuance under the Plan, 3,591,131 shares were available for grant, assuming the maximum performance level, or 200%, and target, or 100%, total shareholder return are achieved related to the performance award grants discussed below. The Plan allows the Company, under the direction of the Board of Directors’ Talent and Compensation Committee, to make grants of performance shares, stock appreciation rights, restricted stock units (“RSUs”) and restricted stock awards to employees, officers and non-employee directors of the Company.

Long-Term Incentive Plan and Related Performance Awards

As of June 30, 2023, the Company had 806,222 performance shares outstanding with a weighted-average grant price of $128.93 per share, assuming the Company were to achieve its maximum level of performance, or 200%, and that the total shareholder return modifier related to the 2023, 2022 and 2021 performances awards are achieved at target, or 100%. The total compensation cost related to unearned performance awards not yet recognized, assuming the Company’s current projected assessment of the level of performance that will be achieved, was approximately $56.3 million, and the weighted average period over which it is expected to be recognized is approximately two years.

Restricted Stock Unit Awards

During the six months ended June 30, 2023, 16,191 shares were issued related to RSUs previously granted in 2020 to certain executives, net of 11,277 shares withheld for taxes. In addition, the shares issued included an adjustment of 25% additional shares based on a total margin improvement metric relative to the Company’s defined peer group that was applicable to executive RSU grants made in 2020. At June 30, 2023, 211,269 restricted stock units were outstanding with weighted-average grant price of $121.57 per share. The total compensation cost related to unearned restricted stock units not yet recognized was approximately $20.4 million, and the weighted average period over which it is expected to be recognized is approximately one and one-half years.

Stock-Settled Appreciation Rights (“SSARs”)

Certain executives and key managers were eligible to receive grants of SSARs through the year ended December 31, 2020. The Company did not grant any SSARs since the year ended December 31, 2020 and does not currently anticipate granting any SSARs in the future. There were 98,259 SSARs outstanding as of June 30, 2023. As of June 30, 2023, the total compensation cost related to the unvested SSARs not yet recognized was approximately $0.1 million, and the weighted average period over which it is expected to be recognized is approximately six months.

Director Restricted Stock Grants

The Plan provides for annual restricted stock grants of the Company’s common stock to all non-employee directors. The 2023 grant was made on April 27, 2023 and equated to 12,069 shares of common stock, of which 10,524 shares of common stock were issued after shares were withheld for taxes. The Company recorded stock compensation expense of approximately $1.5 million during the six months ended June 30, 2023 associated with these grants.