16. Stock-Based Compensation

On March 15, 2019, the Company’s board of directors approved the Plan, which initially authorized the issuance of 4,000,000 shares of the Company’s Common Stock. Stockholders approved amendments to the Plan on May 19, 2022 and May 22, 2025, increasing the number of shares authorized for issuance by 4,000,000 and 5,000,000 shares, respectively. A total of 13,000,000 shares were authorized for issuance under the Plan as of December 31, 2025. The expiration date of the Plan, on and after which no awards may be granted, is March 15, 2029.

The Plan permits the Company to grant restricted stock units (“RSUs”), performance stock units (“PSUs”), stock appreciation rights (“SARs”), and stock options to employees, officers, and non-employee directors. RSUs generally vest ratably over three or four years, except for RSU awards granted to non-employee directors of the board, which generally vest over one year on the anniversary of the date of grant or the date of the first annual meeting of the stockholders following the grant date, whichever is sooner.  For RSU awards granted to non-employee directors that resign prior to vesting, the Board may approve acceleration of vesting of RSUs granted as permitted by the Plan.  PSUs generally vest on the third anniversary of the grant date and are earned based on performance metrics that may include operating cash flow, the Company’s Total Shareholder Return (“TSR Based Award”), Diversification EBITDA (as defined in the applicable PSU Agreement), or stock-price performance, depending on the award year. PSU payouts may range from 0% to 200% (or 150% for certain PSU awards) of target. SARs and options, when granted, vest over three or four years.

Awards typically provide for pro-rated or accelerated vesting upon a qualifying Retirement (as defined in the Plan), provided the participant has been continuously employed by the Company for at least twelve months following the grant date.  In the case of PSUs and RSUs issued to certain executives, vesting is contingent upon the executive’s continued employment through the vesting date, unless the executive’s employment is terminated by reason of death, without Cause, for Good Reason, or in the event of a Change in Control (each term as defined in the Plan).

At the election of participants, the Company may withhold Units and Common Stock, or participants may tender previously acquired shares or cash, to satisfy statutory minimum tax withholding obligations arising upon the vesting or settlement

of awards. In accordance with the terms of the Plan, any shares withheld or tendered for this purpose are added back to the Plan’s share reserve on a one-for-one basis and become available for future awards.

Classification of Awards

Awards granted under the Plan are generally settled in shares and classified as equity, except for SARs and certain RSUs (as determined by the Compensation Committee), which may be settled in cash and classified as liability-based awards.  Certain awards may also be classified as liability-based awards if there are insufficient shares available under the Plan to service awards upon vesting.  As of December 31, 2025, no SAR awards were outstanding and there were no liability-based awards outstanding.

Share Availability

As of December 31, 2024, assuming maximum payout of all outstanding PSUs, 953,569 shares remained available for future issuance under the Plan.

As of December 31, 2025, assuming maximum PSU payout, 2,645,618 shares remained available for future issuance under the Plan.

Restricted Stock Units

Beginning on May 21, 2019, the Compensation Committee began granting time-based RSUs to the Company’s executive officers, certain other employees, and non-employee directors.  Each RSU represents a contingent right to receive, upon vesting, one share of the Company’s Common Stock or its cash equivalent, as determined by the Compensation Committee. These RSU awards granted to executive officers and other employees generally vest in four equal installments on each of the first four anniversaries of the grant date, except for 1,134,524 of RSUs granted on February 25, 2021, whereby 50% vest on the second grant date anniversary and 50% vest on the third grant date anniversary. The RSU awards granted to non-employee directors of the board, except as noted below, generally vest over one year on the anniversary of the date of grant or the date of the first annual meeting of the stockholders following the grant date, whichever is sooner.   However, with respect to RSU awards granted to non-employee directors that resign prior to vesting, the Board may approve acceleration of vesting of RSUs granted as permitted by the Plan.

For the years ended December 31, 2023, 2024, and 2025, respectively, certain of the Company's employees surrendered RSUs owned by them to satisfy their statutory minimum federal and state tax obligations associated with the vesting of RSUs issued under the Plan.

The table below represents the changes in RSUs for the years indicated below:

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The total fair value of RSUs vested during the years ended December 31, 2025, 2024 and 2023 was $2.4 million, $9.5 million, and $17.7 million, respectively.

Stock-based compensation expense for these RSUs recognized in selling, general and administrative expense in the consolidated statement of comprehensive income (loss) for the years ended December 31, 2025, 2024, and 2023, was approximately $4.4 million, $3.8 million, and $5.2 million, respectively, with associated tax benefits of approximately $1.1 million, $0.9 million, and  $1.3 million, respectively. At December 31, 2025, unrecognized compensation expense related to RSUs totaled approximately $5.9 million and is expected to be recognized over a remaining term of approximately 2.38 years.

Performance Stock Units

On February 24, 2022, the Company awarded an aggregate of 245,017 time and performance-based PSUs to certain of the Company’s executive officers and management, which vest upon satisfaction of continued service with the Company until the third anniversary of the grant date and attainment of Company specified three-year cumulative operating cash flow amounts as determined based on the net cash flow from operations disclosed in the Company’s Annual Reports on Form 10-K for the period from January 1, 2022 through December 31, 2024.  The number of PSUs that vest range from 0% to 150% of the Target Level (as defined in the 2022 PSU Agreement) depending on the attainment of Company cash flow performance criteria as previously defined.  As of December 31, 2024, 174,419 of these awards were outstanding and during the year ended December 31, 2025 all vested at 150% of the Target Level.

On May 24, 2022, the Company and the Company’s President and Chief Executive Officer, James B. Archer, entered into the Executive Performance Stock Unit Agreement (the “Archer PSU Agreement”) in connection with Mr. Archer’s previously disclosed intention to continue to serve as President and Chief Executive Officer of the Company and as a member of the Company’s Board of Directors.  Each PSU awarded under the Agreement represents the right to receive one share of the Company’s common stock.  The PSUs awarded pursuant to the Archer PSU Agreement were scheduled to vest and become unrestricted on June 30, 2025. The number of PSUs that vested was determined based upon the achievement of specified share prices over the period between the grant date and June 30, 2025 (the “Archer Performance Period”).  Mr. Archer will earn a corresponding number of PSUs upon the achievement of specified share price thresholds, the first of which is $12.50 per share. If all Performance Goals (as defined in the Archer PSU Agreement) are met during the Archer Performance Period, Mr. Archer will be entitled to receive a maximum of 500,000 PSUs. Vesting is contingent upon Mr. Archer’s continued employment through the vesting date, unless Mr. Archer’s employment is terminated by reason of death or Disability, without Cause, for Good Reason, or in the event of a Qualifying Termination in connection with a Change in Control (each term as defined in the Plan, as amended, or Mr. Archer’s employment agreement with the Company, as amended). These PSUs were valued using a Monte Carlo simulation with the following assumptions on the grant date: the expected volatility was approximately 53.82%, the term was 3.10 years, the dividend rate was 0.0% and the risk-free interest rate was approximately 2.65%, which resulted in a calculated fair value of approximately $2.21 per PSU as of the grant date.  During the year ended December 31, 2025, 250,000 of these awards vested at the Target Level and the remaining were forfeited as the Performance Goals were not satisfied as of June 30, 2025.

On July 12, 2022, the Compensation Committee granted 750,000 PSUs aimed at retaining, motivating and incentivizing certain of the Company’s executive officers, including its named executive officers (“NEOs”), under and pursuant to the Plan.  The form of agreement with respect to the granting of the PSUs has material terms that are substantially similar to those in the Archer PSU Agreement. Such PSUs represent the right to receive one share of the Company’s common stock, par value $0.0001 per share. The PSUs  were scheduled to vest and become unrestricted on June 30, 2025. The number of PSUs that vested was determined based upon the achievement of specified share prices over the Performance Period. The executives will each earn a corresponding number of PSUs upon the achievement of specified share price thresholds, the first of which is $12.50 per share. If all Performance Goals (as defined in the applicable award agreement) are met during the Performance Period, the executives will be entitled to receive the maximum PSUs granted to them. Vesting is contingent upon the applicable executive’s continued employment through the vesting date, unless the applicable executive’s employment is terminated by reason of death or Disability, without Cause, for Good Reason, or in the event of a Qualifying Termination in connection with a Change in Control (each term as defined in the Plan, or each executive’s employment agreement, as amended, with the Company). These PSUs were valued using a Monte Carlo simulation with the following assumptions on the grant date: the expected volatility was approximately 55.76%, the term was 2.97 years,

the dividend rate was 0.0% and the risk-free interest rate was approximately 3.05%, which resulted in a calculated fair value of approximately $6.96 per PSU as of the grant date. During the year ended December 31, 2025, 275,000 of these awards vested at the Target Level and the remaining were forfeited as the Performance Goals were not satisfied as of June 30, 2025.

On March 1, 2023, the Company awarded an aggregate of 91,025 time and performance-based PSUs (the “2023 PSUs”) to certain of the Company’s employees, which vest upon satisfaction of continued service with the Company until the third anniversary of the grant date and attainment of Company Diversification EBITDA (measured through the end of the Performance Period dated February 28, 2026) and TSR criteria (measured through the end of the Performance Period dated December 31, 2025). These PSUs were valued using a Monte Carlo simulation with the following assumptions on the grant date: the expected volatility was approximately 45.86%, the term was 2.84 years, the correlation coefficient was 0.6210, the dividend rate was 0.0% and the risk-free interest rate was approximately 4.60%, which resulted in a calculated fair value of approximately $20.66 per PSU as of the grant date.  With respect to the performance criteria, half of these awards are subject to attainment of the Company Diversification EBITDA criteria and the other half are subject to attainment of the TSR criteria. As of December 31, 2025, 73,931of these awards were outstanding and none of the awards had met the Diversification EBITDA and TSR criteria. In January 2026, and March 2026, respectively, the Compensation Committee approved amendments to the Executive Performance Stock Unit Agreement for these awards between the Company and certain employees, which extended the Performance Period for the TSR and Diversification EBITDA criteria through December 31, 2026, and February 28, 2027, respectively (see Note 19).

On February 29, 2024, the Company awarded an aggregate of 203,057 PSUs to certain of the Company’s executive officers and employees, which vest upon satisfaction of continued service with the Company until the third anniversary of the grant date and attainment of the Company’s Diversification EBITDA and TSR criteria. These PSUs were valued using a Monte Carlo simulation with the following assumptions on the grant date: the expected volatility was approximately 36.30%, the term was 2.84 years, the correlation coefficient was 0.5832, the dividend rate was 0.0% and the risk-free interest rate was approximately 4.41%, which resulted in a calculated fair value of approximately $13.50 per PSU as of the grant date.  With respect to the performance criteria, half of these awards are subject to attainment of the Company Diversification EBITDA criteria and the other half are subject to attainment of the TSR criteria.  As of December 31, 2025, 203,057 of these awards were outstanding and a portion of the TSR criteria was achieved that would result in 68,948 of these awards meeting the TSR criteria, subject to continued satisfaction of the continued service criteria discussed above.

On February 27, 2025, the Company awarded an aggregate of 392,858 PSUs to certain of the Company’s executive officers and employees, which vest upon satisfaction of continued service with the Company until the third anniversary of the Grant Date and attainment of the Company’s TSR criteria. These PSUs were valued using a Monte Carlo simulation with the following assumptions on the grant date: the expected volatility was approximately 37.97%, the term was 2.84 years, the correlation coefficient was 0.5426, the dividend rate was 0.0% and the risk-free interest rate was approximately 4.01%, which resulted in a calculated fair value of approximately $7.93 per PSU as of the grant date.

On February 27, 2025, the Compensation Committee, and the Board, in the case of James B. Archer, the Company’s President and Chief Executive Officer, approved agreements granting PSUs aimed at retaining, motivating and incentivizing certain of the Company’s executive officers under and pursuant to the Plan. Settlement upon vesting of the awards in the form of Common Stock was contingent on stockholder approval of the Plan Amendment at the Company’s 2025 annual meeting of stockholders, otherwise such awards will settle in cash upon vesting. As noted above, the Plan Amendment was approved by the Company’s stockholders on May 22, 2025. Each PSU represents the right to receive one share of Common Stock. PSUs vest and become unrestricted on June 30, 2028. The number of PSUs that vest is determined based upon the achievement of specified share prices over the period between the grant date and June 30, 2028 (the “Performance Period”). The executives will each earn a corresponding number of PSUs upon the achievement of specified share price thresholds, the first of which is $20.00 per share and the highest of which is $30.00 per share. If all Performance Goals (as defined in the applicable award agreements) are met during the Performance Period, Mr. Archer will be entitled to receive a maximum of 2,000,000 PSUs and Mr. Vlacich will be entitled to receive a maximum of 600,000 PSUs. Vesting is contingent upon the applicable executive’s continued employment through the vesting date, unless the applicable executive’s employment is terminated by reason of death or Disability, without Cause, for Good Reason, or in the event of a Qualifying Termination in connection with a Change in Control (each term as defined in the Plan, or each executive’s employment agreement, as amended, with the Company). These PSUs were valued using a Monte Carlo simulation with

the following assumptions on the grant date: the expected volatility was approximately 38.39%, the term was 3.34 years, the dividend rate was 0.0% and the risk-free interest rate was approximately 4.02%, which resulted in a calculated fair value of approximately $0.34 per PSU as of the grant date. Under the authoritative guidance for stock-based compensation, a portion of these PSUs outstanding prior to May 22, 2025, the date stockholders approved the Plan Amendment, were considered liability-based awards due to an insufficient number of shares available under the plan to service these awards upon vesting. The number of awards that were considered liability-based awards through May 22, 2025, the date stockholders approved the Plan Amendment, amounted to 2,494,120. As of May 22, 2025, these PSUs were valued using a Monte Carlo simulation with the following assumptions: the expected volatility was approximately 38.83%, the term was 3.11 years, the dividend rate was 0.0% and the risk-free interest rate was approximately 3.96%, which resulted in a calculated fair value of approximately $0.72 per PSU as of May 22, 2025. As noted above, all such liability-based PSUs were reclassified, as of the Plan Amendment date of May 22, 2025, to additional paid-in-capital, a component of total stockholders’ equity, and are no longer included in liabilities as of December 31, 2025.

The following table represents changes in PSUs for the years indicated below:

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Stock-based compensation expense for these PSUs recognized in selling, general and administrative expense in the consolidated statement of comprehensive income (loss) for the years ended December 31, 2025, 2024, and 2023, was approximately $3.2 million, $2.5 million, and $2.6 million, respectively, with associated tax benefits of approximately $0.8 million, $0.7 million, and  $0.8 million, respectively. At December 31, 2025, unrecognized compensation expense related to PSUs totaled approximately $4.6 million and is expected to be recognized over a remaining term of approximately 2.03 years.

Stock Option Awards

Beginning on May 21, 2019, the Compensation Committee began granting time-based stock option awards to the Company’s executive officers and certain other employees.  The last date such stock option awards were granted was March 4, 2020.  Each option represents the right upon vesting, to buy one share of the Company’s common stock, par value $0.0001 per share, for $4.51 to $10.83 per share. The stock options vest in four equal installments on each of the first four anniversaries of the grant date and expire ten years from the grant date.  

The following table represents changes in stock options for the years indicated below:

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345,227 shares were exercisable at December 31, 2025 with a weighted average exercise price per share of $7.52 and an intrinsic value of $0.6 million. The total fair value of stock option awards vested during the years ended December 31, 2025, 2024 and 2023 was $0, $0.4 million, and $0.8 million, respectively.

Stock-based compensation expense for these stock option awards recognized in selling, general and administrative expense in the consolidated statement of comprehensive income (loss) for the years ended December 31, 2025, 2024, and 2023, respectively, was approximately $0, $0.1 million, and $0.5 million with associated tax benefits of $0, less than $0.1 million, and approximately $0.1 million. As of December 31, 2025, there was no unrecognized compensation expense related to stock options.

The fair value of each option award at the grant date was estimated using the Black-Scholes option-pricing model with the following assumptions: 

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The volatility assumption used in the Black-Scholes option-pricing model is based on peer group volatility as the Company did not have a sufficient trading history as a stand-alone public company to calculate volatility at the grant date.  Additionally, due to an insufficient history with respect to stock option activity and post vesting cancellations, the expected term assumption was based on the simplified method permitted under SEC rules, whereby, the simple average of the vesting period for each tranche of award and its contractual term is aggregated to arrive at a weighted average expected term for the award.  The risk-free interest rate used in the Black-Scholes model is based on the implied US Treasury bill yield curve at the date of grant with a remaining term equal to the Company’s expected term assumption.  The Company has never declared or paid a dividend on its shares of common stock.

Stock-based payments are subject to service based vesting requirements and expense is recognized on a straight-line basis over the vesting period.  Forfeitures are accounted for as they occur.

Stock Appreciation Right Awards

In 2021, the Compensation Committee granted 1,578,537 SARs to certain of the Company’s executive officers and other employees.  Each SAR represented a contingent right to receive, upon vesting, payment in an amount equal to the difference between (a) the fair market value of a Common Share on the date of exercise, over (b) the grant date price.

As approved by the Compensation Committee, all exercised SARs shown in the table below were paid in cash in the amount of $6.2 million and $10.0 million during the years ended December 31, 2024 and 2023, respectively.  As of December 31, 2025 and 2024, respectively, no SARs remained outstanding as all remaining SARs were exercised during the year ended December 31, 2024.

The following table represents changes in SARs for the years indicated below:

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Under the authoritative guidance for stock-based compensation, these SARs were considered liability-based awards, which were measured at fair value using the Black-Scholes option pricing model until settlement.

Increases and decreases in stock-based compensation expense were recognized over the vesting period, or immediately for vested awards. For the years ended December 31, 2025, 2024 and 2023, the Company recognized compensation expense related to these awards in selling, general and administrative expense in the accompanying consolidated statements of comprehensive income (loss) of approximately $0, $0.9 million, and $2.9 million, respectively. As of December 31, 2025 and 2024, there was no liability or unrecognized compensation expense related to SARs.