The stockholders of the Company approved the 2018 Omnibus Incentive Plan (the 2018 Omnibus Plan) and the Second Amended and Restated 2011 Omnibus Incentive Plan (the 2011 Omnibus Plan) to allow the Company to issue equity based compensation to help attract and retain executive, managerial, supervisory or professional employees and non-employee directors. The 2018 Omnibus Plan has 1,100,000 shares of common stock reserved. The 2011 Omnibus Plan had a total of 2,350,000 shares of common stock reserved. Following stockholder approval of the 2018 Omnibus Plan, no additional awards have been made under the 2011 Omnibus Plan.

The 2018 Omnibus Plan and the 2011 Omnibus Plan provide for the grant or award of stock options; stock appreciation rights; restricted and unrestricted stock; restricted stock units; and performance unit awards.

At December 31, 2022 and 2021, 391,089 shares remain reserved and unissued under the provisions of the 2011 Omnibus Plan, a portion of which are allocated to outstanding stock options described below. At December 31, 2022 and 2021, 765,617 and 876,641 shares, respectively, remain reserved and unissued under the provisions of the 2018 Omnibus Plan, a portion of which are allocated to outstanding performance unit awards, outstanding stock options and restricted stock described below. The Company has historically issued new shares to satisfy stock option exercises or other awards issued under the 2018 Omnibus Plan and 2011 Omnibus Plan.

Stock option awards have been granted with an exercise price equal to the market price of the Company’s stock at the date of grant. Stock option awards granted to employees under the plans to date are non-qualified stock options, have vesting over three years, subject to earlier vesting upon a change of control and certain other events, and have a seven-year contractual term. All outstanding stock options held by non-employee directors were granted to the director while employed by Saia, and total 15,780 shares as of December 31, 2022.

The Company grants shares of restricted stock as part of its long-term incentive plan. These shares of restricted stock cliff vest in three years, subject to earlier vesting upon a change in control. The value of restricted stock is based on the fair market value of the Company’s common stock at the date of grant. In addition, the Company has periodically granted shares of restricted stock to certain key executives that vests 25% after three years, 25% after four years and the remaining 50% after five years, assuming the executive has been in continuous service to the Company since the award date, subject to earlier vesting upon a change in control.

Stock option and restricted stock compensation expense of $3.9 million, $3.3 million and $2.8 million, was recorded for the years ended December 31, 2022, 2021 and 2020, respectively, and is included in salaries, wages and employees’ benefits. As of December 31, 2022, there is unrecognized compensation expense of $5.2 million related to unvested stock options and restricted stock, which is expected to be recognized over a weighted average period of 2.2 years.

The following table summarizes stock option activity for the year ended December 31, 2022 for employees:


	Options			Weighted Average Exercise price		Weighted Average Remaining Contractual Life (years)		Aggregate Intrinsic Value (in thousands)
Outstanding at December 31, 2021		120,959		$	98.28		4.7	$	28,879
Granted		14,980			278.21
Exercised		(61,778	)		73.03
Forfeited		(1,838	)		149.14

Outstanding at December 31, 2022		72,323		$	155.83		4.6	$	4,921

Exercisable at December 31, 2022		31,307		$	107.53		3.9	$	3,198

The total intrinsic value of options exercised during the years ended December 31, 2022, 2021 and 2020 was $10.8 million, $5.9 million, and $8.3 million, respectively. The weighted-average grant-date fair value per share of options granted during the years ended December 31, 2022, 2021 and 2020 was $94.36, $62.65, and $25.40, respectively.

The following table summarizes the weighted average assumptions used in valuing options for the years ended December 31, 2022, 2021 and 2020:


	2022	2021	2020
Risk-free interest rate	1.92%	1.19%	1.66%
Expected life in years	3.5	3.5	3.2
Expected volatility	43.32%	40.57%	32.80%
Dividend rate	—	—	—

The risk-free interest rate for periods within the contractual life of the option is based on a three-month average U.S. Treasury yield at the time of grant. The expected life of the options represents the period of time that options granted are expected to be outstanding. Expected volatilities are based on historical volatility of the Company’s stock.

The following table summarizes restricted stock activity during the year ended December 31, 2022:


	Shares			Weighted Average Grant-date Fair Value
Restricted Stock at December 31, 2021		62,071		$	112.21
Granted		15,203			246.11
Vested		(27,404	)		75.32
Forfeited		(1,630	)		145.22

Restricted Stock at December 31, 2022		48,240		$	177.89

The total fair value of restricted stock shares that vested during the years ended December 31, 2022, 2021, and 2020 were $2.1 million, $1.4 million and $1.1 million, respectively.

The Company grants performance unit awards to executives as part of the Company’s long term incentive plan. The criteria for payout of the awards is based on a comparison over the three-year performance period of these awards of the total stockholder return (TSR) of the Company’s common stock compared to the TSR of the companies in a peer group established by the Compensation Committee. The stock-based awards are accounted for in accordance

with ASC Topic 718 with the expense amortized over the three-year vesting period based on the fair value of the awards at the grant date using the Monte Carlo method. Operating results include expense for the performance unit awards of $3.8 million in 2022, $4.0 million in 2021 and $3.5 million in 2020. Shares earned under the performance unit awards are issued in the first quarter of the year following the end of the performance period. There was an issuance of 63,188 shares for the January 2020 - December 2022 performance period in February 2023, 78,710 shares for the January 2019 - December 2021 performance period in February 2022, and 58,662 shares for the January 2018 - December 2020 performance period in February 2021. At December 31, 2022, performance unit awards are outstanding for a maximum of 26,654 shares for the January 2021 – December 2023 performance period and for a maximum of 25,020 shares for the January 2022 – December 2024 performance period. As of December 31, 2022, there is unrecognized compensation expense of $4.3 million related to unvested performance unit awards, which is expected to be recognized over a weighted average period of 1.7 years.

The following table summarizes performance unit awards during the year ended December 31, 2022:


	Shares	Weighted Average Grant-date Fair Value
Performance Unit Awards at December 31, 2021	86,675	$140.35
Granted	12,510	312.30
Added by performance factor	39,355	91.62
Vested	(78,710)	91.62
Forfeited	(2,399)	233.08
Performance Unit Awards at December 31, 2022	57,431	$207.32

The total fair value of performance unit awards shares that vested during the years ended December 31, 2022, 2021, and 2020 were $3.6 million, $3.0 million and $2.3 million, respectively.

The 2018 Omnibus Plan provides for an annual grant to each non-employee director of shares of Saia stock with a value not to exceed $500,000 with the number of shares to be determined each year by the Compensation Committee. For 2022, 2021 and 2020 each non-employee director was granted 396, 548 and 1,098 shares, respectively of Saia stock under the 2018 Omnibus Plan. These shares vest in one year from grant, subject to accelerated vesting upon leaving the Board (other than for cause) or a change in control.

Under the Director’s Deferred Fee Plan, non-employee directors may defer all or a portion of annual fees and awards earned. The deferrals are converted into phantom stock units equivalent to the value of Company common stock. Upon the director’s termination, death or disability, accumulated deferrals are distributed in the form of Company common stock in accordance with elections made by the directors. Non-employee directors were issued 3,272; 3,929; and 9,379 units equivalent to shares in the Company's common stock under the Directors' Deferred Fee Plan during the years ended December 31, 2022, 2021 and 2020, respectively.