Simon 2021 Annual Report

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)

absolute TSR performance), as defined in the applicable award agreements, are achieved during the applicable three-year measurement period, subject to the recipient’s continued employment through the applicable vesting dates. Any units determined to be earned LTIP units under the 2021 LTIP program will vest on January 1, 2025 and any units determined to be earned LTIP units under the 2019 LTIP program will vest on January 1, 2023. The 2021 LTIP program provides that the amount earned related to the performance-based portion of the awards is dependent on Simon’s FFO performance and achievement of certain objective criteria goals and has a maximum potential fair value at grant date of $18.4 million. The 2019 LTIP program provides that the amount earned related to the performance-based portion of the awards is dependent on Simon’s FFO performance and achievement of certain objective criteria goals and has a maximum potential fair value at issuance of $22.1 million. The grant date fair values of any LTIP units for market-based awards are estimated using a Monte Carlo model, and the resulting fixed expense is recorded regardless of whether the market condition criteria are achieved if the required service is delivered. The grant date fair values of the market-based awards are being amortized into expense over the period from the grant date to the date at which the awards, if earned, would become vested. The expense of the performance-based award is recorded over the period from the grant date to the date at which the awards, if earned, would become vested, based on our assessment as to whether it is probable that the performance criteria will be achieved during the applicable performance periods. The Compensation and Human Capital Committees approved LTIP unit grants as shown in the table below. The extent to which LTIP units were earned, and the aggregate grant date fair value, are as follows: 2019 LTIP program . . . . . . . . . . . . . . To be determined in 2022 2021 LTIP program . . . . . . . . . . . . . . To be determined in 2024 $12.2 million We recorded compensation expense, net of capitalization and forfeitures, related to LTIP programs of approximately $13.4 million, $1.9 million, and $15.8 million for the years ended December 31, 2021, 2020 and 2019, 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 Committees 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, 2021 a total of 5,858,453 shares of restricted stock, net of forfeitures, have been awarded under the 1998 plan, and 561,849 shares of restricted stock and RSUs have been awarded under the 2019 plan. During the first quarter of 2021, as part of the 2021 LTI Program the Compensation and Human Capital Committees established a grant of 37,976 time-based RSUs under the 2019 Plan at a weighted average fair market value of $112.92 per share. These awards will vest, subject to the grantee's continued service, on March 1, 2024. The $4.3 million grant date fair value of the awards is being recognized as expense over the three-year vesting service period. During 2020, the Compensation and Human Capital Committees established a one-time grant of 312,263 time- based RSUs under the 2019 Plan at a weighted average fair market value of $84.37 per share. These awards will vest, subject to the grantee's continued service on each applicable vesting date, in one-third increments on January 1, 2022, LTIP Program LTIP Units Earned Grant Date Fair Value of TSR Award Grant Date Target Value of Performance- Based Awards 2018 LTIP program - Tranche A . . . . 2018 LTIP program - Tranche B . . . . 38,148 $6.1 million $6.1 million $9.5 million $5.7 million $6.1 million $6.1 million $14.7 million —

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