Simon Property Group, Inc. Simon Property Group, L.P. Notes to Consolidated Financial Statements (Dollars in thousands, except share, per share, unit and per unit amounts and where indicated as in millions or billions)
2023 LTI Program. In the first quarter of 2023, the Compensation and Human Capital Committee established and granted awards under a 2023 Long-Term Incentive Program, or 2023 LTI Program. Awards under the 2023 LTI Program, took the form of LTIP units and restricted stock units. Awards of LTIP units under this program will be considered earned if the respective performance conditions (based on FFO and Objective Criteria Goals), subject to adjustment based upon a TSR modifier, with respect to the FFO performance condition, as defined in the applicable award agreements, are achieved during the applicable three-year measurement period. Any units determined to be earned LTIP units under the 2023 LTI Program will vest on January 1, 2027. The 2023 LTI Program provides that the amount earned related to the performance-based portion of the awards is dependent on the Compensation and Human Capital Committee’s determination that Simon’s FFO performance and achievement of certain objective criteria goals and has a maximum potential fair value at grant date of $42.5 million. As part of the 2023 LTI Program, on March 1, 2023, the Compensation and Human Capital Committee also established a grant of 64,852 time-based restricted stock units under the 2019 Plan at a grant date fair market value of $121.25 per share. These awards will vest on March 1, 2026. The $7.9 million grant date fair value of these awards is being recognized as expense over the three-year vesting period. The Compensation and Human Capital Committee approved LTIP unit grants as shown in the table below. The extent to which LTIP units were determined by the Compensation and Human Capital Committee to have been earned, and the aggregate grant date fair value, are as follows:
Grant Date Target Value of Performance- Based Awards
Grant Date Fair Value of TSR Award
LTIP Awards
LTIP Units Earned
2021 LTIP Awards . . . . . . . . . . . . . . . To be determined in 2024 2022 LTIP Awards . . . . . . . . . . . . . . . To be determined in 2025 2023 LTIP Awards . . . . . . . . . . . . . . . To be determined in 2026
$5.7 million
$12.2 million $13.7 million
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$23.6 million We recorded compensation expense, net of capitalization and forfeitures, related to LTIP programs of approximately $26.7 million, $24.7 million, and $24.8 million for the years ended December 31, 2023, 2022 and 2021, respectively. Restricted Stock and Restricted Stock Units. The 2019 plan also provides for shares of restricted stock to be granted to certain employees at no cost to those employees, subject to achievement of individual performance and certain financial and return-based performance measures established by the Compensation and Human Capital Committee related to the most recent year’s performance. Once granted, the shares of restricted stock then vest annually over a three-year or a four-year period (as defined in the award). The cost of restricted stock grants, which is based upon the stock’s fair market value on the grant date, is recognized as expense ratably over the vesting period. Through December 31, 2023 a total of 5,858,453 shares of restricted stock, net of forfeitures, have been awarded under the 1998 plan, and 1,061,034 shares of restricted stock and RSUs have been awarded under the 2019 plan. Information regarding restricted stock awards is summarized in the following table for each of the years presented: For the Year Ended December 31, 2023 2022 2021 Shares of restricted stock awarded during the year, net of forfeitures . . . . . . 227,232 160,259 42,036 Weighted average fair value of shares granted during the year . . . . . . . . . . . $ 111.37 $ 129.62 $ 117.52 Compensation expense, net of capitalization. . . . . . . . . . . . . . . . . . . . . . . . . . $ 16,356 $ 9,583 $ 8,817 We also maintain a tax-qualified retirement 401(k) savings plan and offer no other post-retirement or post-employment benefits to our employees.
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