ICF International, Inc. Stock Compensation Disclosure
NOTE 14 - STOCK-BASED COMPENSATION
On June 1, 2023, the Company’s stockholders approved an amendment and restatement of the 2018 Omnibus Plan (the “2018 A&R Omnibus Plan”) which increased the number of shares available for issuance to 2,050,000 shares using stock options, stock appreciation rights, restricted stock, RSUs, performance units and PSAs, cash-based awards, and other stock-based awards to all key officers, key employees, and non-employee directors of the Company. As of December 31, 2025, the Company had approximately 785,433 shares available for grant under the A&R 2018 Omnibus Plan.
Stock-based compensation expense is included as part of direct costs and indirect and selling expenses on the consolidated statements of comprehensive income. The total stock-based compensation expense for the years ended December 31, 2025, 2024, and 2023, the unrecognized compensation expense at December 31, 2025, and the weighted-average period to recognize the remaining unrecognized shares are as follows:
|
|
Stock-Based Compensation Expense |
|
|||||||||||||||||
|
|
Recognized |
|
|
Unrecognized |
|
||||||||||||||
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|
2025 |
|
|
Weighted |
|
|||||
Restricted Stock Units |
|
$ |
11,256 |
|
|
$ |
10,654 |
|
|
$ |
9,413 |
|
|
$ |
14,527 |
|
|
|
1.6 |
|
Cash-Settled Restricted Stock Units |
|
|
4,291 |
|
|
|
8,341 |
|
|
|
8,061 |
|
|
|
6,015 |
|
|
|
1.6 |
|
Non-Employee Director Awards |
|
|
1,019 |
|
|
|
972 |
|
|
|
1,029 |
|
|
|
476 |
|
|
|
0.4 |
|
Performance Shares |
|
|
5,410 |
|
|
|
5,096 |
|
|
|
4,416 |
|
|
|
5,590 |
|
|
|
1.7 |
|
Total |
|
$ |
21,976 |
|
|
$ |
25,063 |
|
|
$ |
22,919 |
|
|
$ |
26,608 |
|
|
|
|
|
The stock-based compensation expense is deductible for income tax purposes. The income tax expense reflects adjustments for differences between the stock-based compensation expense and the actual compensation included in award recipient’s gross income. For the year ended December 31, 2025, the Company recognized an additional $0.4 million of shortfall tax expense related to stock-based compensation. For the years ended December 31, 2024 and 2023, the Company recognized windfall tax benefits of $2.4 million, and $1.1 million, respectively, related to stock-based compensation.
Restricted Stock Units
RSUs generally have a vesting term of three years. On vesting the employee is issued one share of stock for each RSU awarded. The fair value of shares vested was $9.7 million, $10.3 million, and $7.3 million for the years ended December 31, 2025, 2024, and 2023, respectively.
A summary of the Company’s RSUs is presented below:
|
|
Number of |
|
|
Weighted- |
|
|
Aggregate |
|
|||
Non-vested RSUs at January 1, 2023 |
|
|
284,826 |
|
|
$ |
88.23 |
|
|
|
|
|
Granted |
|
|
89,388 |
|
|
$ |
110.80 |
|
|
|
|
|
Vested |
|
|
(93,881 |
) |
|
$ |
78.05 |
|
|
|
|
|
Cancelled |
|
|
(21,815 |
) |
|
$ |
94.01 |
|
|
|
|
|
Non-vested RSUs at December 31, 2023 |
|
|
258,518 |
|
|
$ |
99.25 |
|
|
|
|
|
Granted |
|
|
86,428 |
|
|
$ |
153.22 |
|
|
|
|
|
Vested |
|
|
(107,168 |
) |
|
$ |
95.65 |
|
|
|
|
|
Cancelled |
|
|
(26,807 |
) |
|
$ |
109.79 |
|
|
|
|
|
Non-vested RSUs at December 31, 2024 |
|
|
210,971 |
|
|
$ |
121.86 |
|
|
|
|
|
Granted |
|
|
149,102 |
|
|
$ |
84.94 |
|
|
|
|
|
Vested |
|
|
(86,741 |
) |
|
$ |
111.40 |
|
|
|
|
|
Cancelled |
|
|
(10,453 |
) |
|
$ |
110.20 |
|
|
|
|
|
Non-vested RSUs at December 31, 2025 |
|
|
262,879 |
|
|
$ |
104.83 |
|
|
$ |
22,424 |
|
RSUs expected to vest in the future |
|
|
242,730 |
|
|
$ |
105.26 |
|
|
$ |
20,705 |
|
The aggregate intrinsic value in the preceding table is based on the Company’s closing stock price of $85.30 per share as of December 31, 2025.
Cash-Settled Restricted Stock Units
CSRSUs generally have a vesting term of three years. The fair value of CSRSUs vested and settled in cash for the years ended December 31, 2025, 2024, and 2023 was $6.4 million, $7.8 million and $7.9 million, respectively.
A summary of the Company’s CSRSUs is presented below:
|
|
Number of |
|
|
Weighted- |
|
|
Aggregate |
|
|||
Non-vested CSRSUs at January 1, 2023 |
|
|
188,419 |
|
|
$ |
87.28 |
|
|
|
|
|
Granted |
|
|
70,742 |
|
|
$ |
110.65 |
|
|
|
|
|
Vested |
|
|
(81,537 |
) |
|
$ |
76.26 |
|
|
|
|
|
Cancelled |
|
|
(19,040 |
) |
|
$ |
91.94 |
|
|
|
|
|
Non-vested CSRSUs at December 31, 2023 |
|
|
158,584 |
|
|
$ |
102.82 |
|
|
|
|
|
Granted |
|
|
38,653 |
|
|
$ |
153.15 |
|
|
|
|
|
Vested |
|
|
(58,078 |
) |
|
$ |
99.30 |
|
|
|
|
|
Cancelled |
|
|
(9,424 |
) |
|
$ |
114.93 |
|
|
|
|
|
Non-vested CSRSUs at December 31, 2024 |
|
|
129,735 |
|
|
$ |
118.51 |
|
|
|
|
|
Granted |
|
|
76,306 |
|
|
$ |
84.89 |
|
|
|
|
|
Vested |
|
|
(70,117 |
) |
|
$ |
108.54 |
|
|
|
|
|
Cancelled |
|
|
(10,327 |
) |
|
$ |
115.34 |
|
|
|
|
|
Non-vested CSRSUs at December 31, 2025 |
|
|
125,597 |
|
|
$ |
103.91 |
|
|
$ |
10,713 |
|
CSRSUs expected to vest in the future |
|
|
113,255 |
|
|
$ |
104.54 |
|
|
$ |
9,661 |
|
The aggregate intrinsic value in the preceding table is based on the Company’s closing stock price of $85.30 per share as of December 31, 2025.
Non-Employee Director Awards
The Company grants awards of registered shares to its non-employee directors on an annual basis under the A&R Omnibus Plan.
A summary of the non-employee director awards is presented below:
|
|
Number of |
|
|
Weighted- |
|
|
Aggregate |
|
|||
Non-vested RSUs at January 1, 2023 |
|
|
5,348 |
|
|
$ |
94.79 |
|
|
|
|
|
Granted |
|
|
8,211 |
|
|
$ |
127.81 |
|
|
|
|
|
Vested |
|
|
(9,457 |
) |
|
$ |
109.14 |
|
|
|
|
|
Cancelled |
|
|
— |
|
|
$ |
— |
|
|
|
|
|
Non-vested RSUs at December 31, 2023 |
|
|
4,102 |
|
|
$ |
127.81 |
|
|
|
|
|
Granted |
|
|
6,618 |
|
|
$ |
135.91 |
|
|
|
|
|
Vested |
|
|
(7,414 |
) |
|
$ |
131.43 |
|
|
|
|
|
Cancelled |
|
|
— |
|
|
$ |
— |
|
|
|
|
|
Non-vested RSUs at December 31, 2024 |
|
|
3,306 |
|
|
$ |
135.91 |
|
|
|
|
|
Granted |
|
|
12,484 |
|
|
$ |
87.06 |
|
|
|
|
|
Vested |
|
|
(9,770 |
) |
|
$ |
103.53 |
|
|
|
|
|
Cancelled |
|
|
— |
|
|
$ |
— |
|
|
|
|
|
Non-vested RSUs at December 31, 2025 |
|
|
6,020 |
|
|
$ |
87.16 |
|
|
$ |
514 |
|
RSUs expected to vest in the future |
|
|
6,020 |
|
|
$ |
87.16 |
|
|
$ |
514 |
|
The aggregate intrinsic value in the preceding table is based on the Company’s closing stock price of $85.30 per share as of December 31, 2025.
Performance Share Awards
The Company’s performance-based share program (the “Program”) provides for the issuance of PSAs to its senior management. Under the Program, the PSAs that the participant will receive depends on the Company’s achievement of two performance goals during two performance periods. The performance goals under the Program are based on (i) the Company’s compounded annual growth rate in EPS (adjusted to exclude certain items specified in the award’s agreement) during a two-year performance period (the “Initial Period”) and (ii) the Company’s cumulative total shareholder return relative to its peer group (“rTSR”) during a performance period from the first day of the performance period (typically January 1 of the year awarded) to the last day of the third year of the performance period (typically December 31). The PSAs will only be eligible to vest following the expiration of the three-year performance period. The actual shares vested will be subject to both continued employment by the Company (barring certain exceptions allowing for partial performance periods) and actual financial measures achieved. The final number of shares of common stock that will be issued to each participant at the end of the applicable performance period will be determined by multiplying the award by the product of two percentages: the first based on the Company’s EPS performance and the second based on the Company’s rTSR performance, subject to a minimum and maximum performance level. As of December 31, 2025, shares granted during 2023, 2024, and 2025 are within year three, two, and one of the performance periods, respectively, and therefore have not fully vested. A total of 38,079 shares granted in 2022 vested during 2025 after meeting the performance goals. As of December 31, 2025, a total of 99,342 shares granted in 2023 and 2024 are expected to vest in the future based on estimated financial measures achieved in the Initial Period and rTSR performance.
A summary of the Company’s PSAs is presented below:
|
|
Number of |
|
|
Weighted- |
|
|
Aggregate |
|
|||
Non-vested PSAs at January 1, 2023 |
|
|
120,687 |
|
|
$ |
79.42 |
|
|
|
|
|
Granted |
|
|
36,956 |
|
|
$ |
115.67 |
|
|
|
|
|
Vested |
|
|
(45,141 |
) |
|
$ |
58.76 |
|
|
|
|
|
Cancelled |
|
|
(6,934 |
) |
|
$ |
61.49 |
|
|
|
|
|
Non-vested PSAs at December 31, 2023 |
|
|
105,568 |
|
|
$ |
102.12 |
|
|
|
|
|
Granted |
|
|
41,365 |
|
|
$ |
143.97 |
|
|
|
|
|
Vested |
|
|
(46,630 |
) |
|
$ |
95.72 |
|
|
|
|
|
Cancelled |
|
|
(4,198 |
) |
|
$ |
114.91 |
|
|
|
|
|
Non-vested PSAs at December 31, 2024 |
|
|
96,105 |
|
|
$ |
122.68 |
|
|
|
|
|
Granted |
|
|
79,474 |
|
|
$ |
77.34 |
|
|
|
|
|
Vested |
|
|
(38,079 |
) |
|
$ |
93.97 |
|
|
|
|
|
Cancelled |
|
|
— |
|
|
$ |
— |
|
|
|
|
|
Non-vested PSAs at December 31, 2025 |
|
|
137,500 |
|
|
$ |
104.42 |
|
|
$ |
11,729 |
|
PSAs expected to vest in the future |
|
|
99,342 |
|
|
$ |
101.00 |
|
|
$ |
8,474 |
|
The aggregate intrinsic value in the preceding table is based on the Company’s closing stock price of $85.30 per share as of December 31, 2025.
The fair value of the awards is estimated on the grant date using a Monte Carlo simulation model due to the market condition for the rTSR component. The fair value assumptions using the Monte Carlo simulation model for awards granted in 2025, 2024, and 2023 were:
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
Dividend Yield |
|
|
0.7 |
% |
|
|
0.4 |
% |
|
|
0.5 |
% |
Historical Volatility |
|
|
32.5 |
% |
|
|
29.3 |
% |
|
|
33.6 |
% |
Risk-Free Rate of Returns |
|
|
3.9 |
% |
|
|
4.4 |
% |
|
|
3.8 |
% |
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.