MP Materials Corp. / DEMP
MP Materials Corp. / DE Stock Compensation Disclosure
STOCKHOLDERS’ EQUITY AND STOCK-BASED COMPENSATION
Common Stock and Preferred Stock
The Company’s certificate of incorporation authorizes it to issue up to 500,000,000 shares, consisting of (i) 450,000,000 shares of common stock and (ii) 50,000,000 shares of preferred stock, each with a par value of $0.0001 per share. As discussed in Note 14, “Redeemable Preferred Stock,” on July 10, 2025, the Board of Directors for the Company authorized the designation of 400,000 shares of Series A Preferred Stock each with a stated value of $1,000 from the Company’s existing 50,000,000 authorized but unissued shares of preferred stock.
Public Offering of Common Stock
In July 2025, the Company completed an underwritten public offering of 13,590,908 shares of the Company’s common stock, par value $0.0001 per share, at a price to the public of $55.00 per share (the “Offering”). The underwriters purchased the shares of common stock at the price of $53.35, including the full exercise of the underwriters’ option to purchase additional shares of the Company’s common stock, solely to cover over-allotments. The Company’s net proceeds from the Offering were $724.2 million, after deducting underwriting discounts and commissions and other offering expenses payable by the Company.
Warrant
As discussed in Note 3, “Public-Private Partnership with U.S. Department of War,” on July 10, 2025, the Company issued the Warrant to the DoW, exercisable at any time, in whole or in part, in cash or in net share settlement at the DoW’s option, for a period of ten years prior to its expiration on July 10, 2035, for up to 11,201,659 shares of the Company’s common stock, at an initial exercise price of $30.03 per share. The strike price of $30.03 is subject to customary anti-dilution adjustments. The Warrant was classified as an equity instrument included in “Additional paid-in capital” within the Company’s Consolidated Balance Sheets and was initially recorded at its allocated fair value, based on its relative fair value to the other Issued Instruments, of $261.2 million, net of allocated issuance costs of $3.0 million (see Note 3, “Public-Private Partnership with U.S. Department of War,” for additional information regarding the allocation of consideration and issuance costs). As of December 31, 2025, no shares of common stock had been issued pursuant to the exercise of the Warrant.
Treasury Stock
In March 2024, the Company’s Board of Directors approved a share repurchase program (the “Program”) effective for one year under which the Company became authorized to repurchase up to an aggregate amount of $300.0 million of the Company’s outstanding common stock. In August 2024, the Company’s Board of Directors approved a $300.0 million increase to the Program, bringing the total authorized amount to $600.0 million. The authorization did not require the purchase of any minimum number of shares. On July 11, 2025, pursuant to the terms of the DoW Transaction Agreements, the Company terminated the Program.
During the year ended December 31, 2024, the Company repurchased 15.2 million shares of its common stock at an aggregate cost of $225.1 million. Of the number of shares repurchased, 12.3 million were repurchased in March 2024 contemporaneously with the 2030 Notes offering using $191.6 million of the net proceeds from such offering. The shares repurchased in connection with the 2030 Notes offering were privately negotiated transactions with or through one of the initial purchasers of the 2030 Notes or its affiliate at a price of $15.53 per share, which was equal to the closing price per share of common stock on the date of such transactions. No shares were repurchased during the year ended December 31, 2025.
Capped Call Options
In March 2024, in connection with the offering of the 2030 Notes, the Company entered into the Capped Call Options with the Counterparties, which cover, subject to anti-dilution adjustments substantially similar to those in the 2030 Notes, 34.4 million shares of the Company’s common stock, the same number of shares that initially underlie the 2030 Notes. The Capped Call Options meet the criteria for classification as equity and, as such, are not remeasured each reporting period. During the first quarter of 2024, the Company paid $65.3 million for the Capped Call Options, which was recorded as a reduction to “Additional paid-in capital” within the Company’s Consolidated Balance Sheets along with the offsetting associated deferred tax impact of $15.9 million. See Note 10, “Debt Obligations,” for additional information.
Stock-Based Compensation
2020 Incentive Plan: In November 2020, the Company’s stockholders approved the MP Materials Corp. 2020 Stock Incentive Plan (the “2020 Incentive Plan”), which permits the Company to issue stock options (incentive and/or non-qualified); stock appreciation rights (“SARs”); restricted stock, restricted stock units (“RSUs”) and other stock awards (collectively, the “Stock Awards”); and performance awards, which vest contingent upon the attainment of either or a combination of market- or performance-based goals. As of December 31, 2025, the Company has not issued any stock options or SARs.
Pursuant to the 2020 Incentive Plan, 9,653,671 shares of common stock were initially available for issuance. The number of shares of common stock available under the 2020 Incentive Plan may be increased annually on the first day of each calendar year, beginning with the year ended December 31, 2021, and continuing until (and including) the year ending December 31, 2030, with such annual increase equal to the lesser of (i) 2% of the number of shares of stock issued and outstanding on December 31st of the immediately preceding fiscal year and (ii) an amount determined by the Board of Directors. The number of shares of common stock that remain available for future grants under the 2020 Incentive Plan shall be reduced by the sum of the aggregate number of shares of common stock that become subject to outstanding options, outstanding free-standing SARs, outstanding Stock Awards, and outstanding performance awards denominated in shares of common stock, other than substitute awards. As of December 31, 2025, there were 4,150,457 shares available for future grants under the 2020 Incentive Plan.
In November 2025, the Board of Directors approved and authorized annual increases to the shares of common stock available for issuance under the 2020 Incentive Plan equal to 2% of the Company’s outstanding common stock as of December 31st of the immediately preceding year, with the first increase effective January 1, 2026, and continuing annually through the year ending December 31, 2030.
Market-Based PSUs: In February 2023, pursuant to the 2020 Incentive Plan, the Compensation Committee of the Company’s Board of Directors adopted a performance share plan (the “2023 Performance Share Plan”), pursuant to which, for the year ended December 31, 2023, the Company granted 62,709 of market-based performance stock units (“market-based PSUs”) at target. Additionally, in January 2024, pursuant to the 2020 Incentive Plan, the Compensation Committee of the Company’s Board of Directors adopted another performance share plan (the “2024 Performance Share Plan”), pursuant to which, for the year ended December 31, 2024, the Company granted 177,766 of market-based PSUs.
All market-based PSUs granted cliff vest after a requisite performance and service period of three years. The market-based PSUs have the potential to be earned at between 0% and 200% of the number of awards granted depending on the level of growth of the Company’s total shareholder return (“TSR”) as compared to the TSR of the S&P 400 Index and the S&P 400 Materials Group over the performance period. The fair value of the market-based PSUs was determined using a Monte Carlo simulation technique.
In January 2026, upon approval by the Compensation Committee of the Company’s Board of Directors, the market-based PSUs granted pursuant to the 2023 Performance Share Plan cliff vested after their requisite performance period and were earned at 200% of the number of awards granted based on the achieved TSR.
Performance-Based PSUs: In March 2025, pursuant to the 2020 Incentive Plan, the Compensation Committee of the Company’s Board of Directors adopted a performance share plan (the “2025 Performance Share Plan”). Pursuant to the 2025 Performance Share Plan, during the year ended December 31, 2025, the Company granted 235,533 of performance-based PSUs at target, all of which cliff vest after a requisite performance period of three years. The performance-based PSUs have a requisite service period of approximately three years and have the potential to be earned in 50% increments between 0% and 200% of the number of granted awards depending on the achievement of the performance conditions. The fair value of these performance-based PSUs was determined using the Company’s stock price on the grant date.
In October 2025, pursuant to the 2020 Incentive Plan, the Compensation Committee of the Company’s Board of Directors approved an additional grant of performance-based PSUs, pursuant to which, during the year ended December 31, 2025, the Company granted 400,382 of performance-based PSUs at target, all of which cliff vest after a requisite performance period of , , or years. The performance-based PSUs have a requisite service period of approximately , , or years and have the potential to be earned between 0% and 100% of the number of granted awards depending on the achievement of the performance conditions. The fair value of these performance-based PSUs was determined using the Company’s stock price on the grant date.
The weighted-average grant date fair value of the Company’s performance awards granted during the years ended December 31, 2025, 2024 and 2023 was $62.20, $26.09 and $50.40, respectively.
The following table contains information on the Company’s performance awards:
| Number of Shares | Weighted-Average Grant Date Fair Value | ||||||||||
| Nonvested as of January 1, 2025 | 240,475 | $ | 32.43 | ||||||||
| Granted | 757,748 | $ | 62.20 | ||||||||
| Vested | (3,189) | $ | 27.23 | ||||||||
| Forfeited | — | $ | — | ||||||||
| Nonvested as of December 31, 2025 | 995,034 | $ | 55.11 | ||||||||
As of December 31, 2025, the unamortized compensation cost not yet recognized related to performance awards totaled $48.1 million and the weighted-average period over which the costs are expected to be recognized was 3.3 years.
Stock Awards: The Company granted 1,118,518, 737,835 and 805,322 RSUs to employees during the years ended December 31, 2025, 2024, and 2023, respectively, which, with the exception of 189,670, 130,956 and 67,700 RSUs granted during the years ended December 31, 2025, 2024 and 2023, respectively, that vested immediately, vest ratably in equal installments over the requisite service period of 4 years.
Additionally, the Company granted 35,884, 71,148 and 48,177 RSUs to non-employee directors during the years ended December 31, 2025, 2024, and 2023, respectively, of which, 6,142, 15,252 and 10,691 vested immediately into tax-deferred stock units (“DSUs”) during the years ended December 31, 2025, 2024 and 2023, respectively. The remaining RSUs granted vest into DSUs upon the earlier of one year after the grant date and the next annual stockholder meeting. The DSUs are settled
as shares of common stock of the Company upon the earlier of (i) June 15th of the fifth year after grant, (ii) a change in control of the Company, or (iii) the director’s separation from the Company’s Board of Directors, unless the director elects to defer settlement until retirement.
The grant date fair value of the Company’s Stock Awards is based on the closing stock price of the Company’s shares of common stock on the date of grant. The weighted-average grant date fair value of Stock Awards granted during the years ended December 31, 2025, 2024 and 2023 was $30.19, $16.27 and $24.13, respectively.
The following table contains information on the Company’s Stock Awards:
| Number of Shares | Weighted-Average Grant Date Fair Value | ||||||||||
| Nonvested as of January 1, 2025 | 1,518,929 | $ | 24.71 | ||||||||
| Granted | 1,154,402 | $ | 30.19 | ||||||||
| Vested | (847,618) | $ | 28.63 | ||||||||
| Forfeited | (121,590) | $ | 21.61 | ||||||||
| Nonvested as of December 31, 2025 | 1,704,123 | $ | 26.69 | ||||||||
As of December 31, 2025, the unamortized compensation cost not yet recognized related to Stock Awards totaled $23.3 million and the weighted-average period over which the costs are expected to be recognized was 2.0 years. The total fair value of Stock Awards that vested during the years ended December 31, 2025, 2024 and 2023, was $29.3 million, $23.6 million and $20.7 million, respectively.
The Company’s stock-based compensation and related income tax benefit were recorded as follows:
| For the year ended December 31, | |||||||||||||||||
| (in thousands) | 2025 | 2024 | 2023 | ||||||||||||||
Cost of sales (excluding depreciation, depletion and amortization)(including related party) | $ | 6,914 | $ | 3,311 | $ | 3,932 | |||||||||||
| Selling, general and administrative | 22,197 | 19,074 | 20,508 | ||||||||||||||
Start-up costs | 871 | 381 | 723 | ||||||||||||||
| Advanced projects and development | 181 | 417 | 73 | ||||||||||||||
| Total stock-based compensation expense | $ | 30,163 | $ | 23,183 | $ | 25,236 | |||||||||||
| Stock-based compensation capitalized to property, plant and equipment, net | $ | 4,628 | $ | 1,573 | $ | 1,868 | |||||||||||
Income tax benefit for stock-based compensation arrangements | $ | 6,595 | $ | 4,454 | $ | — | |||||||||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 26, 2026 | Showing above |
| 2024 | Feb 28, 2025 | |
| 2023 | Feb 28, 2024 | |
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.