Stock-Based Compensation

12 Months Ended

Dec. 31, 2024

10.	Stock–Based Compensation

At December 31, 2024, the Company had the following stock-based employee compensation plans:

Equity Incentive Plans

In April 2010, the Company’s board of directors approved the Nu Skin Enterprises, Inc. 2010 Omnibus Incentive Plan (the “2010 Omnibus Incentive Plan”). This plan was approved by the Company’s stockholders at the Company’s 2010 Annual Meeting of Stockholders held in May 2010. The 2010 Omnibus Incentive Plan provides for granting of a variety of equity-based awards including stock options, stock appreciation rights, restricted stock, restricted stock units, other share-based awards, performance cash, performance shares and performance units to executives, other employees and independent consultants of the Company and its subsidiaries, as well as directors of the Company. Options granted under the 2010 Omnibus Incentive Plan are generally non-qualified stock options, but the 2010 Omnibus Incentive Plan permits some stock options granted to qualify as “incentive stock options” under the U.S. Internal Revenue Code. The exercise price of a stock option generally is equal to the fair market value of the Company’s common stock on the stock option grant date. The contractual term of a stock option granted under the 2010 Omnibus Incentive Plan is seven years. Currently, all shares issued upon the exercise of stock options are from the Company’s treasury shares. Subject to certain adjustments, 7.0 million shares were authorized for issuance under the 2010 Omnibus Incentive Plan. In June 2013, the Company’s stockholders approved an Amended and Restated 2010 Omnibus Incentive Plan, which among other things increased the number of shares available for awards by 3.2 million shares. In May 2016, the Company’s stockholders approved a Second Amended and Restated 2010 Omnibus Incentive Plan, which among other things increased the number of shares available for awards by 3.8 million shares. In June 2020, the Company’s stockholders approved a Third Amended and Restated 2010 Omnibus Incentive Plan, which among other things increased the number of shares available for awards by 5.9 million shares.

In April 2024, the Company’s board of directors approved the Nu Skin Enterprises, Inc. 2024 Omnibus Incentive Plan (the “2024 Omnibus Incentive Plan”). This plan was approved by the Company’s stockholders at the Company’s 2024 Annual Meeting of Stockholders held in June 2024. The 2024 Omnibus Incentive Plan provides for granting of a variety of equity-based awards including stock options, stock appreciation rights, restricted stock, restricted stock units, other share-based awards, performance cash, performance shares and performance units to executives, other employees and independent consultants of the Company and its subsidiaries, as well as directors of the Company. Subject to certain adjustments, the number of shares authorized for issuance under the 2024 Omnibus Incentive Plan was the sum of 1.2 million shares plus the number of shares which, as of the 2024 Omnibus Incentive Plan’s effective date, were available for issuance under the Third Amended and Restated 2010 Omnibus Incentive Plan.

Options under the plans as of December 31, 2024 and changes during the year ended December 31, 2024 were as follows:

	Shares (in thousands)			Weighted- average Exercise Price		Weighted- average Remaining Contractual Term (in years)		Aggregate Intrinsic Value (in thousands)
Options activity – performance based
Outstanding at December 31, 2023		907.6		$	39.67
Granted		—			—
Exercised		—			—
Forfeited/cancelled/expired		(206.1	)		49.54
Outstanding at December 31, 2024		701.5			36.77		2.05	$	—
Exercisable at December 31, 2024		701.5			36.77		2.05		—

The aggregate intrinsic value in the table above represents the total pretax intrinsic value (the difference between the Company’s closing stock price on the last trading day of the respective years and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on December 31, 2024. This amount varies based on the fair market value of the Company’s stock.

Cash proceeds, tax benefits and intrinsic value related to total stock options exercised during 2024, 2023 and 2022, were as follows (U.S. dollars in thousands):

	December 31,
	2024		2023		2022
Cash proceeds from stock options exercised	$	—	$	8,322	$	31,600
Tax benefit / (expense) realized for stock options exercised		—		482		229
Intrinsic value of stock options exercised		—		2,338		15,505

Nonvested restricted stock awards as of December 31, 2024 and changes during the year ended December 31, 2024 were as follows:

	Number of Shares (in thousands)			Weighted- average Grant Date Fair Value
Nonvested at December 31, 2023		1,020.5		$	39.42

Granted		1,041.4			11.88
Vested		(385.7	)		39.18
Forfeited		(192.4	)		30.10

Nonvested at December 31, 2024		1,483.8		$	21.36

Nonvested performance share units as of December 31, 2024 and changes during the year ended December 31, 2024 were as follows:

	Number of Shares (in thousands)			Weighted- average Grant Date Fair Value
Nonvested at December 31, 2023		272.9		$	40.09

Granted		558.3			11.98
Vested		(33.0	)		37.62
Forfeited		(131.0	)		34.69

Nonvested at December 31, 2024		667.2		$	17.75

Stock-based compensation expense is recognized on a straight-line basis, except for performance-based awards for which expense is recognized using a graded-attribution method if the results are materially different than the straight-line method. The Company recognized $13.3 million, $14.4 million and $14.3 million of expense related to service condition restricted stock units in 2024, 2023 and 2022, respectively. For performance stock options and performance stock units, an expense is recorded each period for the estimated expense associated with the projected achievement of the performance-based targets. The Company recognized $0, $0 and $2.0 million of income related to performance stock options in 2024, 2023 and 2022, respectively; and $1.5 million, $1.2 million and $0 of expense related to performance stock units in 2024, 2023 and 2022, respectively. The amount in 2022 reflects the reversal of stock compensation for awards no longer expected to vest.

As of December 31, 2024, there was no unrecognized stock-based compensation expense related to nonvested stock option awards. As of December 31, 2024, there was $20.7 million of unrecognized stock-based compensation expense related to nonvested restricted stock awards. That cost is expected to be recognized over a weighted-average period of 2.3 years.