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Stock-Based Compensation Plans | 12 Months Ended
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Dec. 31, 2024
Share-Based Payment Arrangement [Abstract] |
Stock-Based Compensation Plans | Stock-Based Compensation Plans The Company's Plan includes an authorization to issue shares of the Company's common stock, par value $0.01 per share. At December 31, 2024, the Company had 4,957,465 shares remaining available to issue under the Plan, exclusive of shares that may be issued to satisfy currently outstanding awards such as stock options or performance awards. The Plan provides for equity awards to associates, officers, non-employee directors and other key personnel of the Company and its subsidiaries in the form of restricted stock, restricted stock units, stock options that qualify as incentive stock options ("ISOs") under Section 422 of the Code, non-qualified stock options, stock appreciation rights and performance awards, among others. The Plan expires in 2027, however before its expiration the Company expects to amend the plan or adopt a new plan to allow for continued grants of equity awards. The Company's share-based compensation framework includes annual restricted stock awards and multi-year performance awards (the "Performance Awards"). The annual restricted stock vests over a three-year period at one-third per year. For annual restricted stock awards, in lieu of restricted stock, an officer may elect to receive up to 100% of the award value, in increments of 25%, in the form of stock options, which vests consistent with the restricted stock awards. Annually, the Company grants a target number of performance awards, with the ultimate award determined by the total shareholder return of the Company's common stock and/or operating performance metrics, measured over a performance period of three years. Performance units earned at the end of the measurement period are settled in fully vested shares of common stock and a payment of a cash amount representing accrued dividends on earned performance awards. The Company granted supplemental stock options in February 2021, that have a ten-year term and cliff vested on March 1, 2023. The options were granted at an exercise price that equaled the closing stock price on the grant date with recipients having 12 months to exercise the option if terminated without cause and will have until the expiration date to exercise the options if they retire. For Performance Awards, after the first year of the performance period, if an employee's employment terminates on account of death, disability, retirement, or termination without cause, the employee's target grant will be pro-rated based on the employee's service time during the performance period. The final payout is based on actual performance, at which time the units will be converted into shares and a payment of a cash amount for accrued dividends based on actual performance. For other terminating events, performance awards are generally forfeited. Information with respect to stock options granted under the Plan is as follows:
| Options |  | Weighted average exercise price per option
Options Outstanding, December 31, 2021 | 299,149 |  |  | $ | 178.71 |
Granted (1) | 9,793 |  |  | 236.14 |
Exercised | (8,670) |  |  | 135.78 |
Forfeited | (6,459) |  |  | 180.32 |
Options Outstanding, December 31, 2022 | 293,813 |  |  | $ | 181.85 |
Granted (1) | 15,744 |  |  | 177.83 |
Exercised | (5,773) |  |  | 163.56 |
Forfeited | — |  |  | — |
Options Outstanding, December 31, 2023 | 303,784 |  |  | $ | 181.99 |
Granted (1) | 13,759 |  |  | 172.11 |
Exercised | (41,619) |  |  | 179.89 |
Forfeited | — |  |  | — |
Expired | (5,062) |  |  | 180.32 |
Options Outstanding, December 31, 2024 | 270,862 |  |  | $ | 181.84 |
Options Exercisable: |  |  |
December 31, 2022 | 6,533 |  |  | $ | 165.51 |
December 31, 2023 | 279,894 |  |  | $ | 180.97 |
December 31, 2024 | 246,877 |  |  | $ | 181.82 |
__________________________________ (1)All options are from recipient elections to receive a portion of earned restricted stock awards in the form of stock options. The Company used the Black-Scholes Option Pricing model to determine the grant date fair value of options. The assumptions used are as follows:
|  | 2024
Dividend yield |  | 4.5 | %
Estimated volatility |  | 29.7 | %
Risk free rate |  | 4.31 | %
Expected life of options |  | 5 years
Estimated fair value |  | $35.32
The following summarizes the exercise prices and contractual lives of options outstanding as of December 31, 2024:
The Plan Number of Options |  | Range—Exercise Price | Weighted Average Remaining Contractual Term (in years)
261,069 |  | $172.00 | - | $181.99 |  | 6.4
9,793 |  | $236.00 | - | $245.99 |  | 7.1
270,862 |  |  |  |  |  |
Options outstanding at December 31, 2024 had an intrinsic value of $10,486,000. Options exercisable had an intrinsic value of $9,528,000 and had a weighted average contractual life of 6.2 years. The intrinsic value of options exercised under the Plan during 2024, 2023 and 2022 was $1,394,000, $113,000 and $602,000, respectively. Information with respect to performance awards granted is as follows:
|  | Performance awards |  | Weighted average grant date fair value per award
Outstanding at December 31, 2021 |  | 284,522 |  |  | $ | 214.73 |
Granted (1) |  | 72,783 |  |  | 254.75 |
Change in awards based on performance (2) |  | (20,356) |  |  | 200.92 |
Converted to shares of common stock |  | (54,053) |  |  | 217.33 |
Forfeited |  | (3,829) |  |  | 230.36 |
Outstanding at December 31, 2022 |  | 279,067 |  |  | $ | 225.46 |
Granted (3) |  | 90,215 |  |  | 193.85 |
Change in awards based on performance (2) |  | (31,345) |  |  | 241.49 |
Converted to shares of common stock |  | (60,016) |  |  | 238.71 |
Forfeited |  | (2,719) |  |  | 212.05 |
Outstanding at December 31, 2023 |  | 275,202 |  |  | $ | 210.52 |
Granted (4) |  | 95,782 |  |  | 185.97 |
Change in awards based on performance (2) |  | 30,375 |  |  | 216.50 |
Converted to shares of common stock |  | (146,725) |  |  | 201.07 |
Forfeited |  | (4,511) |  |  | 201.41 |
Outstanding at December 31, 2024 |  | 250,123 |  |  | $ | 207.55 |
_________________________________ (1) The shares of common stock earned was based on the total shareholder return metrics for the Company’s common stock for 39,972 performance awards and financial metrics related to operating performance, net asset value and leverage metrics of the Company for 32,811 performance awards. (2) Represents the change in the number of performance awards earned based on performance achievement. (3) The shares of common stock that may be earned is based on the total shareholder return metrics for the Company’s common stock for 49,611 performance awards and financial metrics related to operating performance and leverage metrics of the Company for 40,604 performance awards. (4) The shares of common stock that may be earned is based on the total shareholder return metrics for the Company’s common stock for 52,683 performance awards and financial metrics related to operating performance and leverage metrics of the Company for 43,099 performance awards. The Company used a Monte Carlo model to assess the compensation cost associated with the portion of the performance awards granted for which achievement will be determined by using total shareholder return measures. The assumptions used are as follows:
|  | 2024 |  | 2023 |  | 2022
Dividend yield |  | 3.9% |  | 3.7% |  | 2.7%
Estimated volatility over the life of the plan (1) |  | 20.5% - 22.8% |  | 22.9% - 26.1% |  | 16.1% - 36.8%
Risk free rate |  | 3.92% - 4.59% |  | 4.35% - 4.61% |  | 0.72% - 1.68%
Estimated performance award value based on total shareholder return measure |  | $189.47 |  | $206.97 |  | $271.98
_________________________________ (1) Estimated volatility over the life of the plan is using 50% historical volatility and 50% implied volatility. For the portion of the performance awards granted for which achievement will be determined by using financial metrics, the compensation cost was based on an average grant date value of $175.54, $177.83 and $233.94, for the years ended December 31, 2024, 2023 and 2022, respectively, and the Company's estimate of corporate achievement for the financial metrics. Information with respect to restricted stock granted is as follows:
|  | Restricted stock shares |  | Weighted average grant date fair value per share |  | Restricted stock shares converted from performance awards
Outstanding at December 31, 2021 |  | 157,066 |  |  | $ | 192.90 |  |  | 74,627 |
Granted |  | 86,475 |  |  | 231.93 |  |  | — |
Vested |  | (78,212) |  |  | 197.51 |  |  | (48,171) |
Forfeited |  | (3,615) |  |  | 218.19 |  |  | (86) |
Outstanding at December 31, 2022 |  | 161,714 |  |  | $ | 210.97 |  |  | 26,370 |
Granted |  | 93,146 |  |  | 177.70 |  |  | — |
Vested |  | (79,450) |  |  | 207.93 |  |  | (26,370) |
Forfeited |  | (2,119) |  |  | 194.78 |  |  | — |
Outstanding at December 31, 2023 |  | 173,291 |  |  | $ | 194.68 |  |  | — |
Granted |  | 104,081 |  |  | 173.14 |  |  | — |
Vested |  | (90,582) |  |  | 194.89 |  |  | — |
Forfeited |  | (4,408) |  |  | 181.73 |  |  | — |
Outstanding at December 31, 2024 |  | 182,382 |  |  | $ | 182.59 |  |  | — |
Total employee stock-based compensation cost recognized in income was $25,390,000, $27,417,000 and $34,131,000 for the years ended December 31, 2024, 2023 and 2022, respectively, and total capitalized stock-based compensation cost was $11,117,000, $10,906,000 and $10,431,000 for the years ended December 31, 2024, 2023 and 2022, respectively. At December 31, 2024, there was a total unrecognized compensation cost of $29,021,000 for unvested restricted stock, stock options and performance awards, which is expected to be recognized over a weighted average period of 1.7 years. The Company reverses any previously recognized compensation cost for forfeitures as they occur. Employee Stock Purchase Plan In October 1996, the Company adopted the 1996 Non-Qualified Employee Stock Purchase Plan (as amended, the "ESPP"). Initially, 1,000,000 shares of common stock were reserved for issuance, and as of December 31, 2024, there are 550,002 shares remaining available for issuance under the ESPP. Employees of the Company generally are eligible to participate in the ESPP if, as of the last day of the applicable purchase period, they have been employed by the Company for at least one calendar month. Under the ESPP, eligible employees can acquire shares of the Company's common stock through payroll deductions, subject to maximum purchase limitations, during two purchase periods. The first purchase period begins January 1 and ends June 10, and the second purchase period begins July 1 and ends December 10. The purchase price for common stock under the plan is 85% of the lesser of the fair market value of the Company's common stock on the first or the last day of the applicable purchase period. The offering dates, purchase dates and duration of purchase periods may be changed if the change is announced prior to the beginning of the affected date or purchase period. The Company issued 19,014, 23,059 and 20,837 shares and recognized compensation expense of $859,000, $911,000 and $564,000 under the ESPP for the years ended December 31, 2024, 2023 and 2022, respectively. The Company accounts for transactions under the ESPP using the fair value method prescribed by accounting guidance applicable to entities that use employee share purchase plans.

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