Stock-Based Compensation

12 Months Ended

Dec. 31, 2025

Share-Based Payment Arrangement [Abstract]

Disclosure of Compensation Related Costs, Share-based Payments

Description of Stock Plans

Under the 2022 Stock Incentive Plan (the 2022 Plan), up to 6.8 million shares of common stock are available for awards to our employees, officers, consultants, and directors.  Awards may be in the form of stock options, stock appreciation rights, restricted stock, restricted stock units, performance share units, and other stock-based awards.  Each award, under the 2022 plan is counted as 1.00 share. The exercise price for stock options issued cannot be less than the fair value of the underlying common stock as of the grant date. The maximum term of each stock option or stock appreciation right is ten years after the date of grant.  At December 31, 2025, approximately 4.8 million shares were available for future grants under the 2022 Plan.

We issue new shares of common stock for all of our stock plan vestings and exercises.

Cash Incentive Units (CIUs)

CIUs are denominated and settled in cash, with each unit representing the right to receive one dollar. Vesting for the CIUs occurs at the end of a three-year period and is based upon prospective company performance measures and our total shareholder return relative to a board-approved peer group during the three-year period. We issued 9.7 million, 9.5 million, and 9.0 million CIUs during 2025, 2024, and 2023, respectively. However, actual performance, including the modification for relative total shareholder return, may result in an award of up to 200 percent of the initial number of CIUs issued.

Activity for CIUs, which are classified as a liability, is as follows:

	Units
	(000s)
Outstanding at December 31, 2024	16,455
Granted	15,545
Vested	(13,228)
Outstanding at December 31, 2025	18,772

At December 31, 2025, the three-year performance period for the 2023 CIU grant was completed and the related shares vested, but the performance factor had not yet been applied. The performance factor will be applied during the first quarter of 2026, with payments of awards at that time. Granted and vested amounts in the preceding table also include an adjustment to reflect the application of the performance factor to the 2022 CIU grant, which occurred during the first quarter of 2025.

At December 31, 2025 and 2024 the liability for CIUs was $39.0 million and $36.2 million, respectively. CIU payments made during 2025 and 2024 totaled $12.2 million and $13.9 million. There were no CIU payments made during 2023. At December 31, 2025, we had approximately $0.9 million of unrecognized compensation cost related to CIUs that will be recognized over a weighted average period of 1.6 years. The estimated compensation expense is adjusted for actual performance experience and is recognized ratably during the service period, or remaining service period, if and when it becomes probable that the performance conditions will be satisfied. Compensation cost for CIUs subject to accelerated vesting at the date of retirement eligibility is recognized over the implicit service period.

The fair value of CIUs is estimated at each reporting period using the Monte-Carlo simulation model. Key assumptions used to value CIUs granted are as follows:

	Assumptions as of the Year Ended December 31, 2025
	2025 Grant		2024 Grant
Expected Volatility (based on our and our peer group historical daily stock prices)	30	%	28	%
Expected Life (equals the remaining performance period)	2 years		1 year
Risk Free Interest Rate (based on U.S. Treasury yields)	3.43	%	3.46	%

	Assumptions as of the Year Ended December 31, 2024
	2024 Grant		2023 Grant
Expected Volatility (based on our and our peer group historical daily stock prices)	30	%	30	%
Expected Life (equals the remaining performance period)	2 years		1 year
Risk Free Interest Rate (based on U.S. Treasury yields)	4.25	%	4.19	%

	Assumptions as of the Year Ended December 31, 2023
	2023 Grant		2022 Grant
Expected Volatility (based on our and our peer group historical daily stock prices)	30	%	27	%
Expected Life (equals the remaining performance period)	2 years		1 year
Risk Free Interest Rate (based on U.S. Treasury yields)	4.26	%	4.75	%

Restricted Stock Units (RSUs)

RSUs vest over a one to three-year service period, beginning at the date of grant, and the compensation cost is recognized ratably during the vesting period.  Forfeitable dividend equivalents on RSUs are accrued as cash. Compensation cost for RSUs subject to accelerated vesting at the date of retirement eligibility is recognized over the implicit service period.

Activity for RSUs, which are classified as equity, is as follows:

		Weighted Average
	Shares	Grant Date
	(000s)	Fair Value
Outstanding at December 31, 2024	987	$	44.31
Granted	550	81.16
Vested	(688)	50.85
Forfeited	(50)	60.34
Outstanding at December 31, 2025	799	63.05

During 2025, 2024, and 2023, we issued RSUs with a weighted average grant date fair value per share of $81.16, $49.57, and $45.56, respectively. 

The total fair value of shares vested during 2025, 2024, and 2023 was $35.0 million, $34.8 million, and $49.9 million, respectively. At December 31, 2025, we had $30.9 million of unrecognized compensation cost related to RSUs that will be recognized over a weighted average period of 1 year.

Expense

Compensation expense for the stock based plans, as reported in our consolidated statements of income, is as follows:

	Year Ended December 31
	2025		2024		2023
	(in millions of dollars)
Cash Incentive Units	$	15.3	$	12.4	$	21.7
Restricted Stock Units	37.3		34.5		40.3
Other	1.0		0.9		2.1
Total Compensation Expense, Before Income Tax	$	53.6	$	47.8	$	64.1
Total Compensation Expense, Net of Income Tax	$	47.3	$	41.6	$	57.5

Certain prior year amounts in the preceding chart have been reclassified to conform to current presentation.

Cash received under all share-based payment arrangements for the years ended December 31, 2025, 2024, and 2023 was $5.1 million, $6.0 million, and $5.2 million, respectively.