Share-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2025

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Stock Incentive Plans

The following table summarizes the methods used to measure fair value for each type of award and the related vesting period over which compensation expense is recognized:


Type of equity-settled award	Vesting period	Fair Value Measure	Compensation expense based on:
Stock options	Up to four years	Black-Scholes option pricing model	Fair value on business day prior to grant date
TRSUs	Up to four years	Closing common share price	Fair value on business day prior to grant date
PRSUs	Three-year performance period	Closing common share price	Fair value on business day prior to grant date and adjusting the number of awards expected to vest based on company performance

Fair Value Measurement of Stock Options

The weighted-average fair value of options granted for the years ended December 31, 2025 and 2024 and principal assumptions used in applying the Black-Scholes option pricing model are as follows:


			Year ended December 31,
			2025		2024
Weighted-average fair value			$40.26		$35.93
Weighted-average of key assumptions:
Share price			$176.06		$157.02
Exercise price			$176.06		$157.02
Risk-free interest rate			4.1%		4.2%
Dividend yield			1.6%		1.8%
Volatility factor			22%		23%
Expected life (in years)			5		5

Number of Awards Outstanding

The movement in the number of awards outstanding and their related weighted-average exercise prices are as follows:


Awards outstanding (in thousands):	Stock Options	TRSUs	PRSUs	Total	Weighted-Average Exercise Price(1)
Outstanding as of December 31, 2023	1,334	1,018	643	2,995	$89.76
Granted	196	438	338	972	$157.02
Exercised	(273)	(578)	(347)	(1,198)	$77.98
Forfeited	(44)	(82)	(64)	(190)	$122.15
Outstanding as of December 31, 2024	1,213	796	570	2,579	$102.10
Exercisable as of December 31, 2024	677	-	-	677	$84.32
Granted	191	613	204	1,008	$176.06
Exercised	(206)	(420)	(199)	(825)	$91.10
Forfeited	(2)	(73)	(43)	(118)	$142.51
Outstanding as of December 31, 2025	1,196	916	532	2,644	$115.75
Exercisable as of December 31, 2025	707	-	-	707	$91.87

(1)

Represents the weighted-average exercise price for stock options. TRSUs and PRSUs are excluded as they entitle holders to receive common shares upon vesting without an associated exercise price.

Summary of Share Based Compensation Expense

Share-based compensation expense for years ended December 31, 2025 and 2024 are as follows:


(millions of U.S. dollars)		Stock Options	TRSUs	PRSUs		ESPP	Total
December 31, 2025		5	68	33		5	111
December 31, 2024		5	52	25		5	87

Summary of Additional Information Relating to Stock Option and SAR's

The following table summarizes additional information relating to stock options outstanding as of December 31, 2025:


Range of exercise prices(1)		Number Outstanding (in thousands)	Weighted-Average Remaining Contractual Life (years)	Weighted-Average Exercise Price for Awards Outstanding		Number Exercisable (in thousands)	Weighted-Average Exercise Price for Awards Exercisable
$50.01 - $55.00		34	3	$54.36		34	$54.36
$75.01 - $80.00		265	4	$75.96		265	$75.96
$85.01 - $90.00		175	5	$88.87		175	$88.87
$100.01 - $105.00		178	6	$102.00		117	$102.00
$120.01 - $125.00		176	7	$121.21		75	$122.22
$155.01 - $160.00		176	8	$156.94		40	$156.94
$165.01 - $195.00		192	9	$176.00		1	$176.00
Total		1,196				707

(1)

TRSUs and PRSUs are excluded as they entitle holders to receive common shares upon vesting without an associated exercise price.