WARRIOR MET COAL, INC. Stock Compensation Disclosure
Note 16—Equity Award Plans
Warrior Met Coal, Inc. 2017 Equity Incentive Plan
In connection with the Company's initial public offering, the Company adopted the Warrior Met Coal, Inc. 2017 Equity Incentive Plan (the “2017 Equity Plan”).
Under the 2017 Equity Plan, directors, officers, employees, consultants and advisors and those of affiliated companies, as well as those who have accepted offers of employment or consultancy from the Company or the Company’s affiliated companies, may be granted equity interest in Warrior Met Coal, Inc. in the form of stock options, stock appreciation rights, restricted stock, restricted stock units, stock bonus awards, and performance awards.
The total number of shares of common stock, including incentive stock options, available for grant of awards under the 2017 Equity Plan as of December 31, 2025 is 3,945,930. If any outstanding award expires, is canceled, forfeited, or settled in cash, the shares allocable to that award will again be available for grant under the 2017 Equity Plan.
As of December 31, 2025, the equity awards granted under the 2017 Equity Plan are comprised of common stock, restricted stock awards, and restricted stock unit awards. The Company recognized stock compensation expense of $20.0 million, $22.1 million and $18.3 million for the years ended December 31, 2025, 2024 and 2023, respectively, associated with awards granted under the 2017 Equity Plan. Unrecognized compensation expense associated with time-based and market-based awards under the 2017 Equity Plan amounted to approximately $1.9 million as of December 31, 2025. The total fair value of shares vested during the years ended December 31, 2025, 2024 and 2023 was $22.3 million, $31.0 million and $24.2 million, respectively, excluding net shares issued above the 100% targeted performance level.
A summary of activity related to restricted stock unit award grants under the 2017 Equity Incentive Plan during the years ended December 31, 2025, December 31, 2024 and December 31, 2023 is as follows:
|
|
Shares |
|
|
Weighted |
|
||
Non-vested at December 31, 2022 |
|
|
756,063 |
|
|
$ |
26.99 |
|
Granted |
|
|
527,636 |
|
|
$ |
29.90 |
|
Canceled |
|
|
(5,982 |
) |
|
$ |
36.60 |
|
Forfeited |
|
|
(324 |
) |
|
$ |
37.43 |
|
Vested |
|
|
(608,224 |
) |
|
$ |
29.10 |
|
Non-vested at December 31, 2023 |
|
|
669,169 |
|
|
$ |
40.66 |
|
Granted |
|
|
355,949 |
|
|
$ |
52.02 |
|
Canceled |
|
|
(1,552 |
) |
|
$ |
60.39 |
|
Forfeited |
|
|
(1,449 |
) |
|
$ |
50.35 |
|
Vested |
|
|
(503,714 |
) |
|
$ |
35.05 |
|
Non-vested at December 31, 2024 |
|
|
518,403 |
|
|
$ |
55.86 |
|
Granted |
|
|
414,092 |
|
|
$ |
64.95 |
|
Canceled |
|
|
(98 |
) |
|
$ |
53.39 |
|
Forfeited |
|
|
(3,910 |
) |
|
$ |
62.46 |
|
Vested |
|
|
(435,637 |
) |
|
$ |
56.22 |
|
Outstanding at December 31, 2025 |
|
|
492,850 |
|
|
$ |
63.13 |
|
Performance-based restricted shares have been presented in the table above to reflect the actual shares issued based on the achievement of past performance targets. Non-vested performance-based restricted shares granted are presented in the table above at the target number of restricted shares that would vest if the performance targets are met.
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.