TopBuild Corp. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Share-Based Compensation (Tables)

Share-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2021

Schedule of share-based compensation expense and related income tax benefit

The following table presents share-based compensation amounts recognized in our consolidated statements of operations, in thousands:


	Year Ended December 31,
	2021		2020		2019
Share-based compensation expense	$	11,316	$	14,752	$	13,658
Income tax benefit	$	2,419	$	7,772	$	6,285

Schedule of share-based compensation activity

The following table presents a summary of our share-based compensation activity for the year ended December 31, 2021, in thousands, except per share amounts:


	RSAs			Stock Options
	Number of Shares	Weighted Average Grant Date Fair Value Per Share		Number of Shares	Weighted Average Grant Date Fair Value Per Share		Weighted Average Exercise Price Per Share		Aggregate Intrinsic Value
Balance December 31, 2020	324.8	$	87.79	239.7	$	24.33	$	68.86	$	27,612.1
Granted	74.6	$	246.50	24.1	$	89.59	$	214.58
Converted/Exercised	(144.7)	$	81.76	(53.3)	$	22.15	$	61.87	$	7,303.3
Forfeited/Expired	(10.3)	$	93.63	—	$	—	$	—
Balance December 31, 2021	244.4	$	119.41	210.5	$	32.35	$	87.30	$	39,692.4

Exercisable December 31, 2021 (a)				114.3	$	20.88	$	57.55	$	24,964.8

(a)	The weighted average remaining contractual term for vested stock options is 5.7 years.

Schedule of unrecognized share-based compensation expense relating to unvested awards

We had unrecognized share-based compensation expense relating to unvested awards as shown in the following table, dollars in thousands:


	As of December 31, 2021
	Unrecognized Compensation Expense on Unvested Awards		Weighted Average Remaining Vesting Period
RSAs	$	10,574		0.8
Stock options		1,317		1.0
Total unrecognized compensation expense related to unvested awards	$	11,891

Schedule of key inputs used to estimate the fair value of awards


	2021			2020
Measurement period (years)		2.87			2.88
Risk free interest rate		0.22	%		1.40	%
Dividend yield		0.00	%		0.00	%
Estimated fair value of market-based RSAs at grant date	$	298.66		$	158.24

Schedule of assumptions used to estimate the fair values of options granted


	2021			2020
Risk free interest rate		0.76	%		1.53	%
Expected volatility, using historical return volatility and implied volatility		43.29	%		31.50	%
Expected life (in years)		6.0			6.0
Dividend yield		0.00	%		0.00	%
Estimated fair value of stock options at grant date	$	89.59		$	39.49

Performance-based conditions | Restricted Stock Awards

Share-Based Compensation

Schedule of the range of payouts and the related expense for RSAs with performance-based conditions


			Payout Ranges and Related Expense
RSAs with Performance-Based Conditions	Grant Date Fair Value		0%		25%		100%		200%
February 18, 2019	$	2,184	$	—	$	546	$	2,184	$	4,368
February 17, 2020	$	2,675	$	—	$	669	$	2,675	$	5,350
February 16, 2021	$	2,552	$	—	$	638	$	2,552	$	5,104