Equity-based compensation expenses are recognized in general and administrative expenses on the Company’s Condensed Consolidated Statements of Operations. The Company recognized $8.8 million and $16.8 million in equity-based compensation expenses related to equity-classified awards during the three and six months ended June 30, 2026, respectively. During the three and six months ended June 30, 2025, the Company recognized $6.1 million and $13.0 million in equity-based compensation expenses related to equity-classified awards, respectively. Equity-based compensation expenses related to liability-classified awards were $3.2 million for the six months ended June 30, 2026, and not material for the three months ended June 30, 2026 or the three and six months ended June 30, 2025.

Restricted stock units. Restricted stock units (“RSUs”) are contingent shares that generally vest on either a cliff or graded basis over a one-year or three-year period (as applicable) and are subject to a service condition. During the six months ended June 30, 2026, the Company granted 287,780 RSUs to employees and non-employee directors of the Company with a weighted average grant date fair value of $98.76 per share.

Market stock units. During the six months ended June 30, 2026, the Company granted Market Stock Units (“MSUs”), which are eligible to vest and become earned at the end of the three-year performance period, which begins on January 1 of the initial grant year and ends on December 31 of the third year, subject to the level of achievement with respect to certain performance goals.

The MSUs are subject to time-based service requirements and market conditions based on the total stockholder return (“TSR”) achieved by the Company during the performance period. Depending on the Company’s TSR, award recipients may earn between 0% and 200% of the number of MSUs originally granted. Any earned MSUs will be settled in shares of the Company’s common stock.

Performance share units. During the six months ended June 30, 2026, the Company granted PSUs that include (i) absolute TSR PSUs (“Absolute TSR PSUs”) and (ii) relative TSR PSUs (“Relative TSR PSUs” and collectively with the Absolute TSR PSUs, the “PSUs”), which are eligible to vest and become earned at the end of the three-year performance period which begins on January 1 of the initial grant year and ends on December 31 of the third year.

The Absolute TSR PSUs are subject to time-based service requirements and market conditions based on the TSR achieved by the Company during the performance period. Depending on the Company’s TSR, award recipients may earn between 0% and 200% of the target number of Absolute TSR PSUs originally granted.

The Relative TSR PSUs are subject to time-based service requirements and market conditions based on a comparison of the TSR achieved by the Company against the TSR achieved by the members of a defined peer group at the end of the performance period. Depending on the Company’s TSR performance relative to the TSR performance of the members of the defined peer group, award recipients may earn between 0% and 200% of the target number of Relative TSR PSUs originally granted.

Any earned PSUs will be settled in shares of the Company’s common stock for up to 100% of the target number of PSUs subject to each applicable award, with any remaining earned PSUs that exceed the target number of PSUs subject to the award being settled in cash based on the fair market value of a share of the Company’s common stock on the applicable payment date. The PSUs are bifurcated and classified as equity-based and liability-based awards based on the probability of achieving various target performance thresholds.

During the six months ended June 30, 2026, the Company granted (i) 30,299 Absolute TSR PSUs to certain employees of the Company with a weighted average grant date fair value of $101.14 per share and (ii) 90,912 Relative TSR PSUs to employees of the Company with a weighted average grant date fair value of $114.53 per share.

Fair value assumptions. The aggregate grant date fair value of the PSUs and MSUs were determined by a third-party valuation specialist using a Monte Carlo simulation model which uses a probabilistic approach for estimating the fair value of the awards. The key valuation inputs were: (i) the forecast period, (ii) risk-free interest rate, (iii) the yield curve associated with the Company’s credit rating, (iv) implied equity volatility, (v) stock price on the date of grant and (vi) solely for Relative TSR PSUs, correlation coefficient. The risk-free interest rates are the U.S. Treasury bond rates on the date of grant that correspond to the performance period. Implied equity volatility is derived by solving for an asset volatility and equity volatility based on the leverage of the Company and each of its peers. For the Relative TSR PSUs, the correlation coefficient measures the strength of the linear relationship between and amongst the Company and its peers based on historical stock price data.

The following table summarizes the assumptions used in the Monte Carlo simulation model to determine the grant date fair value and associated equity-based compensation expenses for the PSUs and MSUs granted during the six months ended June 30, 2026:

Phantom unit awards. Phantom unit awards represent the right to receive a cash payment equal to the fair market value of one share of common stock upon vesting and vest on a graded basis over a three-year period and are subject to a service condition. During the six months ended June 30, 2026, the Company granted 21,970 phantom unit awards to employees with a weighted average grant date fair value of $95.63 per share.