BALL Corp Stock Compensation Disclosure
19. Stock-Based Compensation Programs
The company has shareholder-approved stock plans under which options and stock-settled appreciation rights (SSARs) have been granted to employees at the market value of the company’s stock on the date of grant. In general, options and SSARs are exercisable in four equal installments commencing one year from the date of grant and terminating 10 years from the date of grant. All disclosures within this note, unless otherwise specified, include impacts from activities associated with grants to employees of the historical aerospace business through the date of the sale. A summary of outstanding stock option and SSAR activity for the year ended December 31, 2025, follows:
Number of | Weighted Average | ||||
| Shares | | Exercise Price | ||
Beginning of year | 8,912,604 | $ | 56.87 | ||
Granted | 549,131 | 51.38 | |||
Exercised | (1,016,962) | 35.73 | |||
Canceled/forfeited | (805,580) | 59.43 | |||
Expired | (466,995) | 69.02 | |||
End of period | 7,172,198 | 58.37 | |||
Vested and exercisable, end of year | 5,722,467 | $ | 58.24 | ||
Reserved for future grants | 9,551,038 | ||||
The weighted average remaining contractual term for all options and SSARs outstanding at December 31, 2025, was 4.4 years and the aggregate intrinsic value (difference in exercise price and closing price at that date) was $35 million. The weighted average remaining contractual term for options and SSARs vested and exercisable at December 31, 2025, was 3.5 years and the aggregate intrinsic value was $35 million. The company received $16 million, $23 million and $26 million from options and SSARs exercised during 2025, 2024 and 2023, respectively, and the intrinsic value associated with these exercises was $18 million, $22 million and $35 million for the same periods, respectively. The excess tax benefit associated with the company’s stock compensation programs was $2 million for 2025, and was reported as a discrete item in the consolidated tax provision. The total fair value of options and SSARs vested during 2025, 2024 and 2023 was $18 million, $19 million and $19 million, respectively.
Based on the Black-Scholes option pricing model, options granted in 2025, 2024 and 2023 have estimated weighted average fair values at the date of grant of $16.27 per share, $17.97 per share and $16.95 per share, respectively. The fair values were estimated using the following weighted average assumptions:
2025 Grants | 2024 Grants | 2023 Grants | |||||
Expected dividend yield | 1.56 | % | 1.42 | % | 1.41 | % | |
Expected stock price volatility | 31.18 | % | 31.51 | % | 30.11 | % | |
Risk-free interest rate | 4.25 | % | 4.07 | % | 3.52 | % | |
Expected life of options (in years) | 5.80 | 5.84 | 5.80 |
In addition to stock options and SSARs, the company issues to certain employees restricted shares and restricted stock units, which generally vest over three years.
Following is a summary of restricted stock activity for the year ended December 31, 2025:
Weighted | |||||
Number of | Average | ||||
| Shares/Units | | Grant Price | ||
Beginning of year | 1,120,086 | $ | 54.07 | ||
Granted | 751,099 | 57.67 | |||
Vested | (481,577) | 73.82 | |||
Canceled/forfeited | (279,679) | 54.90 | |||
End of year | 1,109,929 | $ | 47.54 | ||
For the years ended December 31, 2025, 2024 and 2023, the company recognized pretax expense of $28 million (all in continuing operations), $63 million ($56 million in continuing operations and $7 million in discontinued operations) and $33 million ($29 million in continuing operations and $4 million in discontinued operations), respectively, for all of its share-based compensation arrangements. The after-tax expense for these arrangements was $26 million, $56 million and $31 million in 2025, 2024 and 2023, respectively. At December 31, 2025, there was $33 million of total unrecognized compensation cost related to nonvested share-based compensation arrangements. This cost is expected to be recognized in earnings over a weighted average period of 2.0 years.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 19, 2026 | Showing above |
| 2024 | Feb 20, 2025 | |
About Stock Compensation Disclosures
Stock-based compensation disclosures detail the equity awards granted to employees and executives — including stock options, restricted stock units (RSUs), and performance shares — along with the valuation methods and assumptions used to expense them. This section reveals the true cost of talent retention and the alignment between management incentives and shareholder interests.
Key signals: total unrecognized compensation expense and its expected recognition period signal future earnings headwinds from already-granted awards. For stock options, examine Black-Scholes assumptions — expected volatility, risk-free rate, and expected term — as understating any of these reduces reported compensation expense. Compare stock compensation expense as a percentage of revenue against peers to assess dilution cost. Watch vesting schedules for acceleration clauses tied to change-of-control events. Performance-based awards with undemanding targets may indicate weak governance. Add back stock compensation to operating cash flow to calculate a more conservative free cash flow figure.