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OPTIONS AND AWARDS | 9 Months Ended
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Sep. 30, 2025
Share-Based Payment Arrangement [Abstract] |
OPTIONS AND AWARDS | OPTIONS AND AWARDS Stock-based compensation expense consists of stock-based payment awards made to employees and directors, including employee stock options and restricted stock awards, based on estimated fair values. As stock-based compensation expense recognized in the Company’s condensed consolidated statements of income for the three and nine months ended September 30, 2025 and 2024 was based on awards expected to vest, it has been reduced for estimated forfeitures. The Company estimates forfeitures at the time of grant and, if necessary, revises the estimate in subsequent periods if actual forfeitures differ. The Company has one stock incentive plan, the Amended and Restated 2022 Omnibus Incentive Plan (the Amended and Restated Plan), pursuant to which grants of the Company's securities may currently be made. During the second quarter of 2025, the Company’s stockholders approved the Amended and Restated Plan, which increased the total number of shares authorized for issuance under the 2022 Omnibus Incentive Plan (the Predecessor Plan). Including the shares rolled over from the Predecessor Plan, the Amended and Restated Plan provides for the issuance of 4,231 shares of common stock. The number of shares available to be issued under the Amended and Restated Plan will be reduced by (i) one share for each share that relates to an option or stock appreciation right award and (ii) two shares for each share which relates to an award other than a stock option or stock appreciation right award (a full-value award). Non-employee director options, to the extent granted, will vest and become exercisable in three equal annual installments, or the length of the term if less than three years, on the completion of each year of service measured from the grant date. All other options generally vest over five years at 20% per year on the anniversary of the grant date. Options expire ten years from the date of grant. At September 30, 2025, the total number of shares available for issuance under the Amended and Restated Plan was 3,724. The Company uses the Black-Scholes option-pricing model to recognize the value of stock-based compensation expense for stock option awards. Determining the appropriate fair-value model and calculating the fair value of stock option awards at the grant date requires judgment, including estimating stock price volatility, expected option life, and forfeiture rates. The fair-value of the restricted stock awards at the grant date is based on the market price on the grant date, adjusted for forfeiture rates. The Company develops estimates based on historical data and market information, which can change significantly over time. Stock Options The Company used the following assumptions for stock options granted during the three months ended September 30, 2025 and 2024:
Grant Year |  | Options Granted |  | Weighted Average Risk-Free Rate |  | Expected Life |  | Weighted Average Volatility |  |  |  | Weighted Average Dividend Yield |  |
2025 |  | 190 |  | 4.0% |  | 6.2 years |  | 39.1% |  |  |  | 0.2% |  |
2024 |  | 112 |  | 3.8% |  | 6.2 years |  | 40.3% |  |  |  | 0.2% |  |
The Company used the following assumptions for stock options granted during the nine months ended September 30, 2025 and 2024:
Grant Year |  | Options Granted |  | Weighted Average Risk-Free Rate |  | Expected Life |  | Weighted Average Volatility |  | Weighted Average Dividend Yield
2025 |  | 517 |  | 4.1% |  | 6.2 years |  | 39.3% |  | 0.2%
2024 |  | 466 |  | 4.2% |  | 6.1 years |  | 40.7% |  | 0.2%
For the nine months ended September 30, 2025 and 2024, the following represents the exercise price and fair value displayed at grant date for stock option grants:
Grant Year |  | Granted |  | Weighted Average Exercise Price |  | Weighted Average Fair Value of Options
2025 |  | 517 |  | $ | 149.08 |  |  | $ | 66.56 |
2024 |  | 466 |  | $ | 127.07 |  |  | $ | 57.81 |
The weighted average exercise price equaled the weighted average fair value of common stock on the grant date for all options granted during the nine months ended September 30, 2025 and 2024 and therefore, the intrinsic value was $0 at the date of grant. The following table represents the employee stock option activity during the nine months ended September 30, 2025:
| Number of Options Outstanding |  | Weighted Average Exercise Price |  | Number of Options Vested |  | Weighted Average Exercise Price of Options Vested
January 1, 2025 | 3,987 |  |  | $ | 78.84 |  |  | 1,895 |  |  | $ | 52.64 |
Granted | 517 |  |  | 149.08 |  |  |  |  |
Forfeited | (46) |  |  | 107.63 |  |  |  |  |
Exercised | (455) |  |  | 49.93 |  |  |  |  |
September 30, 2025 | 4,003 |  |  | $ | 90.87 |  |  | 1,928 |  |  | $ | 62.74 |
The aggregate intrinsic value of options outstanding, vested, expected to vest and exercised as of September 30, 2025 and December 31, 2024 is as follows:
Options |  | September 30, 2025 |  | December 31, 2024 |  |
Outstanding |  | $ | 327,883 |  |  | $ | 219,309 |  |  |
Vested |  | 212,109 |  |  | 152,011 |  |  |
Expected to vest |  | 108,579 |  |  | 63,243 |  |  |
The intrinsic value is calculated as the difference between the market value of the underlying common stock and the exercise price of the options. The aggregate intrinsic value of options that vested during the nine months ended September 30, 2025 and 2024 was $40,633 and $34,971, respectively. The total intrinsic value of options exercised during the nine months ended September 30, 2025 and 2024 was $44,962 and $50,840, respectively. Restricted Stock Awards The Company granted 43 and 177 restricted stock awards during the three and nine months ended September 30, 2025, respectively. The Company granted 29 and 116 restricted stock awards during the three and nine months ended September 30, 2024, respectively. All awards were granted at an issue price of $0 and generally vest over five years. The fair value per share of restricted awards granted during the nine months ended September 30, 2025 and 2024 ranged from $126.34 to $169.24 and $116.65 to $146.37, respectively. The fair value per share includes quarterly stock awards to non-employee directors. Included in the restricted stock award grants are $8,003 and $6,165 of annual bonuses that were settled in vested restricted stock awards in the first quarter of 2025 and 2024, respectively. A summary of the status of the Company's non-vested restricted stock awards as of September 30, 2025 and changes during the nine months ended September 30, 2025 is presented below:
| Non-Vested Restricted Awards |  | Weighted Average Grant Date Fair Value
Nonvested at January 1, 2025 | 435 |  |  | $ | 102.71 |
Granted | 177 |  |  | 141.85 |
Vested | (195) |  |  | 104.05 |
Forfeited | (9) |  |  | 107.92 |
Nonvested at September 30, 2025 | 408 |  |  | $ | 119.62 |
During the three and nine months ended September 30, 2025, the Company granted 4 and 11 automatic quarterly stock awards, respectively, to non-employee directors for their service on the Company's board of directors. The fair value per share of these stock awards ranged from $129.09 to $141.18 based on the market price on the grant date. Stock-based compensation expense Stock-based compensation expense recognized for the Company's equity incentive plans and long-term incentive plan for the three and nine months ended September 30, 2025 and 2024 was as follows:
| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024 |  |
Stock-based compensation expense related to stock options | $ | 8,361 |  |  | $ | 5,699 |  |  | $ | 22,568 |  |  | $ | 16,205 |  |  |
Stock-based compensation expense related to restricted stock awards | 3,999 |  |  | 2,883 |  |  | 11,162 |  |  | 8,546 |  |  |
Stock-based compensation expense related to restricted stock awards to non-employee directors | 508 |  |  | 595 |  |  | 1,457 |  |  | 1,635 |  |  |
TOTAL | $ | 12,868 |  |  | $ | 9,177 |  |  | $ | 35,187 |  |  | $ | 26,386 |  |  |
In future periods, the Company expects to recognize approximately $94,617 and $42,557 in stock-based compensation expense for unvested options and unvested restricted stock awards, respectively, that were outstanding as of September 30, 2025. Future stock-based compensation expense will be recognized over 3.7 weighted average years for both unvested options and restricted stock awards. There were 2,075 unvested and outstanding options as of September 30, 2025, of which 1,916 options are expected to vest. The weighted average contractual life for options outstanding, vested and expected to vest as of September 30, 2025 was 6.7 years.

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