Stock-Based Compensation Plans

12 Months Ended

Dec. 31, 2020

Share-based Payment Arrangement [Abstract]

Stock-Based CompensationThe Company currently maintains the Simpson Manufacturing Co., Inc. Amended and Restated 2011 Incentive Plan (the “2011 Plan”) as its only equity incentive plan. Under the 2011 Plan, no more than 16.3 million shares of the Company’s common stock in aggregate may be issued including shares already issued pursuant to prior awards granted under the 2011 Plan. Shares of common stock underlying awards to be issued pursuant to the 2011 Plan are registered under the Securities Act. Under the 2011 Plan, the Company may grant restricted stock and restricted stock units. The Company currently intends to award only performance-based stock units ("PSUs") and/or time-based restricted stock units ("RSUs").

The following table shows the Company’s stock-based compensation activity:


	Fiscal Years Ended December 31,
(in thousands)	2020		2019		2018
Stock-based compensation expense recognized	$	11,384	$	9,480	$	10,356
Tax benefit of stock-based compensation expense in provision for income taxes	2,859		2,330		2,476
Stock-based compensation expense, net of tax	$	8,525	$	7,150	$	7,880
Fair value of shares vested	$	21,921	$	16,760	$	15,372
Proceeds to the Company from the exercise of stock options	$	—	$	—	$	695

The Company allocates stock-based compensation expense amongst cost of sales, research and development and other engineering expense, selling expense, or general and administrative expense based on the job functions performed by the employees to whom the stock-based compensation is awarded. Stock-based compensation capitalized in inventory was immaterial for all periods presented.

The following table summarizes the Company’s unvested restricted stock unit activity for the year ended December 31, 2020:


	Shares (in thousands)	Weighted- Average Price		Aggregate Intrinsic Value * (in thousands)
Unvested Restricted Stock Units (RSUs)
Outstanding at January 1, 2020	462	$	47.75	$	37,065
Awarded	167	74.91
Vested	(259)	40.92
Forfeited	(13)	57.83
Outstanding at December 31, 2020	357	$	66.13	$	33,188
Outstanding and expected to vest at December 31, 2020	351	$	66.05	$	32,839

* The intrinsic value for outstanding and expected to vest is calculated using the closing price per share of $93.45, as reported by the New York Stock Exchange on December 31, 2020.

During the year ended December 31, 2020, the Company granted 166,951 RSUs and PSUs to the Company’s employees, including officers at an estimated weighted average fair value of $74.91 per share, based on the closing price (adjusted for certain market factors primarily the present value of dividends) of the Company’s common stock on the grant date. The RSUs and PSUs granted to the Company’s employees may be time-based, performance-based or time- and performance-based. Certain of the PSUs are granted to officers and key employees, where the number of performance-based awards to be issued is based on the achievement of certain Company performance criteria established in the award agreement over a cumulative three year period. These awards cliff vest after three years. In addition, these same officers and key employees also receive time-based RSUs, which vest pursuant to a three-year graded vesting schedule. Time- and performance based RSUs granted to the Company’s employees excluding officers and certain key employees, vest ratably over the four year life of the award and through 2019, required the underlying shares of the Company's common stock to be subject to a performance-based adjustment during the first year and starting in 2020, were time-based awards which vest ratable over the four year life of the award.

The Company’s seven non-employee directors are entitled to receive approximately $690 thousand in equity compensation annually. The number of shares ultimately granted are based on the average closing share price for the Company over the 60 day period prior to approval of the award in April of each year. In April 2020, the Company granted 9,239 shares of common stock to the Company's non-employee directors, based on the average closing price of $74.66 per share. The Company recognized expense on these shares at an estimated fair value of $58.72 per share based on the closing price of the Company's common stock on the grant date, for a total expense of $543 thousand.

The total intrinsic value of RSUs vested during the years ended December 31, 2020, 2019 and 2018 was $21.9 million, $16.7 million and $9.8 million, respectively, based on the market value on the vest date.

As of December 31, 2020, the Company’s aggregate unamortized stock compensation expense was approximately $13.3 million, which is expected to be recognized in expense over a weighted-average period of approximately 2.1 years.

Stock Bonus PlanThe Company also maintains a stock bonus plan, the Simpson Manufacturing Co., Inc. 1994 Employee Stock Bonus Plan (the “Stock Bonus Plan”), whereby it awards shares of the Company’s common stock to employees, who do not otherwise participate in any of the Company’s equity-based incentive plans and meet minimum service requirements. Shares have generally been awarded under the Stock Bonus Plan following the year in which the respective employee reached his or her tenth, twentieth, thirtieth, fortieth or fiftieth anniversary of employment with the Company or any direct or indirect subsidiary thereof. The Company awarded 12,600 shares for service through 2020, (7,400 shares to be issued and 5,200 shares of which were settled in cash for the Company’s foreign employees) and awarded 7,000 shares for service through 2019, (4,000 shares to be issued and 3,000 shares of which were settled in cash for the Company’s foreign employees). As a result, we recorded pre-tax compensation charges of $1.2 million in 2020, and $0.8 million for both of the years ended December 31, 2019 and 2018, respectively. The charges also include cash bonuses to compensate employees for income taxes payable as a result of the stock bonuses.