There were no stock options awarded during the three months ended March 31, 2026. As of March 31, 2026, nominal shares were outstanding and exercisable, each with a weighted average exercise price of $41.70 and a weighted average remaining contractual term of 1.7 years. As of December 31, 2025, nominal outstanding and exercisable shares had a weighted average exercise price of $63.57 and $63.55, respectively, and a weighted average remaining contractual term of 1.7 years.

As of March 31, 2026, total compensation expense not yet recognized related to non-vested restricted stock units was $2.3 million and the weighted-average period in which the expense is expected to be recognized is 2.1 years. For the three months ended March 31, 2026 and 2025, compensation expense related to the RSUs was $6.8 million and $0.8 million, respectively.

In July 2022, we granted market-based RSUs to certain members of management that vest if our closing stock price on the NYSE is equal to or higher than the stock price goal of $12.00 per share. The grant date fair value per market-based RSU was $6.70 and determined using a Monte Carlo simulation approach. On March 5, 2026, our stock price closed at $13.29 per share which triggered the vesting of 0.5 million shares. There was no compensation expense recognized for the three months ended March 31, 2026 and 2025, respectively.

The Company has outstanding cash-settled SARs held by two employees. The SARs may be exercised during specified periods when the Company's stock price exceeds the applicable share price goal. The liability method is used to recognize the accrued compensation expense with cumulatively adjusted revaluations to the then current fair value at each reporting date through final settlement. As of March 31, 2026 and December 31, 2025, we calculated the fair value of the SARs at $6.5 million and nominal, respectively. The SARs are recorded in Accrued employee benefits and Other accrued liabilities in the Condensed Consolidated Balance Sheets.

The change in fair value of the SARs liability for the three months ended March 31, 2026 was $6.4 million and is recognized in Selling, general and administrative expenses in the Condensed Consolidated Statements of Operations. The increase in the fair value of the SARs during the quarter was primarily driven by an increase in the Company's stock price.

The fair value of the SARs is categorized within Level 3 of the fair value hierarchy due to the use of significant unobservable inputs, including expected volatility. In making these assumptions, we based estimated volatility on the historical returns of our stock price and selected guideline companies. We based risk-free rates on the corresponding U.S. Treasury spot rates for the expected duration at the date of grant, which we convert to a continuously compounded rate. We relied upon a suboptimal exercise factor, representing the ratio of the base price to the stock price at the time of exercise, to account for potential early exercise prior to the expiration of the contractual term. With consideration to the executive level of the SARs holders, a suboptimal exercise multiple of 2.0x was selected. Subject to vesting conditions, should the stock price achieve a value of 2.0x above the base price, we assume the holders will exercise prior to the expiration of the contractual term of the SARs. The expected term for the SARs is an output of the valuation model in estimating the time period that the SARs are expected to remain unexercised. The valuation model assumes the holders will exercise their SARs prior to the expiration of the contractual term of the SARs.