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Stock Based Compensation Plans | 3 Months Ended
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Mar. 31, 2025
Share-Based Payment Arrangement [Abstract] |
Stock Based Compensation Plans | 6. Stock Based Compensation Plans The Company's Long-Term Incentive Program (“LTIP”) provides employees with an award of stock options and initial grants of restricted stock units (“RSUs”), and grants of performance share units ("PSUs") to members of the Company's Executive Leadership Team ("ELT"). Awards are granted in the first quarter of each year. The Company recognizes the grant-date fair value for each of these awards, less estimated forfeitures, as compensation expense ratably over the vesting period. For employees and directors that meet retirement eligibility requirements, the expense related to share-based compensation is recognized on the date of grant as there is no future service period required for the awards to vest. Stock Options The following table provides a summary of option activity:
|  |  |  |  |  |  | Weighted |  |  |  |
|  |  |  |  |  |  | Average |  |  |  |
|  |  |  | Weighted |  |  | Remaining |  |  |  |
|  |  |  | Average |  |  | Contractual |  |  | Aggregate |
|  |  |  | Exercise |  |  | Term |  |  | Intrinsic |
| Options |  |  | Price |  |  | (in Years) |  |  | Value |
Outstanding at December 31, 2024 |  | 8.4 |  |  | $ | 77.10 |  |  |  |  |  |  |
Granted |  | 1.0 |  |  |  | 111.84 |  |  |  |  |  |  |
Exercised |  | (0.3 | ) |  |  | 57.50 |  |  |  |  |  |  |
Outstanding at March 31, 2025 |  | 9.1 |  |  | $ | 81.42 |  |  |  | 6.3 |  |  | $ | 261.9 |
Exercisable at March 31, 2025 |  | 4.8 |  |  | $ | 69.74 |  |  |  | 4.4 |  |  | $ | 192.0 |
The following table provides information regarding the intrinsic value of stock options exercised and stock compensation expense related to stock option awards:
| Three Months Ended |
| March 31, |  |  | March 31, |
| 2025 |  |  | 2024 |
Intrinsic Value of Stock Options Exercised | $ | 16.3 |  |  | $ | 68.8 |
Stock Compensation Expense Related to Stock Option Awards | $ | 13.1 |  |  | $ | 16.5 |
Issued Stock Options |  | 1.0 |  |  |  | 1.0 |
Weighted Average Fair Value of Stock Options issued (per share) | $ | 33.43 |  |  | $ | 29.81 |
Fair Value of Stock Options Issued | $ | 32.3 |  |  | $ | 30.1 |
| Three Months Ended |
| March 31, |  |  | March 31, |
| 2025 |  |  | 2024 |
Risk-free interest rate |  | 4.2 | % |  |  | 4.2 | %
Expected life in years |  | 7.0 |  |  |  | 7.2 |
Expected volatility |  | 22.6 | % |  |  | 22.3 | %
Dividend yield |  | 1.1 | % |  |  | 1.1 | %
Restricted Stock Units The Company granted employees 95,160 RSUs with a total fair value of $10.5 at a weighted average grant date fair value of $110.86 per RSU during the first quarter of 2025 and granted employees 76,090 RSUs with a total fair value of $7.6 at a weighted average grant date fair value of $100.28 per RSU during the first quarter of 2024. The annual RSU grants vest one-third on each of the first, second and third anniversaries of the grant date, subject to the recipient’s continued employment with the Company from the grant date through the applicable vesting date, and are settled with shares of the Company’s Common Stock within 60 days following the applicable vesting date. Additionally, in connection with the Hero Acquisition (see Note 10), 854,882 shares of restricted stock were issued to certain individuals in October 2022 with a total fair value of $61.5. This restricted stock is recognized as compensation expense ratably over the vesting period if those individuals continue to be employed by the Company. The vesting requirements are satisfied at various dates over a three-year period from the date of the acquisition, including 427,438 shares which vested as of December 31, 2024, 213,719 shares which vested in April of 2025 and the final 213,725 shares vesting in October of 2025. The restricted stock expense associated with the Hero Acquisition for the three months ended March 31, 2025 and 2024 was $2.8 and $7.3, respectively, and is included in the non-cash compensation expense caption in the consolidated statement of cash flows. Performance Stock Units In the first quarter of each of 2025 and 2024, the Company granted PSUs to members of the Executive Leadership Team including the CEO, with an aggregate award of 18,140 and 19,960 PSUs, respectively. The PSUs were valued at a weighted average grant date fair value equal to $136.76 in 2025 and $122.24 in 2024 using a Monte Carlo model. The performance target is based on the Company's total sharehold er return ("TSR") relative to a Company selected peer group. The PSUs vest on the later of (i) the third anniversary of the grant date, and (ii) the date that the Board's Compensation & Human Capital Committee certifies the achievement of the applicable performance goals, in each case, subject to the recipient’s continued employment with the Company from the grant date through the vesting date. The number of shares that may be issued ranges from 0% to 200% based on relative TSR during the three-year performance period. Discounted Employee Stock Purchase Plan The Company’s discounted Employee Stock Purchase Plan (“ESPP”) was adopted in February 2023 by the Company’s Board of Directors and became effective in April 2023 upon approval by the Company’s stockholders. There are 750,000 shares of Common Stock reserved for issuance under the ESPP. The ESPP, which is intended to be an “employee stock purchase plan” under Section 423 of the Internal Revenue Code, permits eligible employees to purchase Common Stock through after-tax payroll deductions. Currently, the purchase price under the ESPP is 85% of the fair market value of our Common Stock on the last trading day of the applicable quarterly purchase period. The maximum value of Common Stock that an eligible employee may purchase each calendar year is the lesser of 10% of an eligible employee’s annual pay and $25,000. There are four purchase periods in each calendar year under the ESPP, which begin on the first business day of each calendar quarter and end on the last business day of each calendar quarter. The first purchase period commenced in January 2025.

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