Ingevity CorpNGVT
Ingevity Corp Stock Compensation Disclosure
Share-based Compensation
Equity Incentive Plan
The Ingevity Corporation 2025 Omnibus Incentive Plan, adopted on February 10, 2025, grants certain corporate officers, key employees, and non-employee directors of Ingevity and subsidiaries different forms of benefits, including stock options, Restricted Stock Units ("RSUs"), Director Stock Units ("DSUs"), and Performance-based restricted Stock Units ("PSUs"). The Ingevity Corporation 2025 Omnibus Incentive Plan ("2025 Plan"), adopted in February 2025, has a maximum shares reserve of 4,425,000 for the grant of equity awards. The 2025 Plan, increased the shares available from the 2016 Omnibus Incentive Plan from 4,000,000 to 4,425,000. As of December 31, 2025, 1,383,737 shares under the Ingevity Corporation 2025 Omnibus Incentive Plan are still available to be granted, assuming that Ingevity performs at the target performance level in each year of the three-year performance period for PSU awards. The Talent and Compensation Committee of Ingevity's Board of Directors ("Compensation Committee") determines the long-term incentive mix, including stock options, RSUs, and PSUs, and may authorize new grants annually. We typically issue new common shares for the vesting of awards under our equity incentive plan.
Employee Stock Purchase Plan
On December 9, 2016, our Compensation Committee and Board of Directors approved the 2017 Ingevity Corporation Employee Stock Purchase Plan ("ESPP"), which was approved by Ingevity's stockholders on April 27, 2017. The ESPP allows eligible employee participants to purchase no more than 5,000 shares of our common stock at a discount through payroll deductions up to 15 percent of their compensation deducted during the purchase period. However, no participant shall be permitted to purchase common stock with a value greater than $25,000 in any calendar year. The ESPP is a tax-qualified plan under Section 423 of the Internal Revenue Code. The ESPP consists of a one-month enrollment period preceding the three-month purchase period. Employees purchase shares in each purchase period at 85 percent of the market value of our common stock at either the beginning of the offering period or the end of the purchase period, whichever price is lower.
On April 27, 2023, the ESPP was amended to add an additional 300,000 shares of Ingevity's common stock, increasing the total amount of shares under the ESPP to 550,000 shares, those additional shares were registered with the SEC on May 4, 2023. The shares are reserved and authorized for issuance to participating U.S. employees, as defined by the ESPP. We typically issue treasury shares for issuances under the ESPP. As of December 31, 2025, 309,997 shares under the ESPP are still available for issuance. During fiscal year 2025, there were 9,614 shares issued under the ESPP at an average price of $37.74.
Our share-based compensation, inclusive of continuing and discontinued operations, and ESPP expense is included in the table below.
| Years Ended December 31, | |||||||||||||||||
| In millions | 2025 | 2024 | 2023 | ||||||||||||||
| Stock option expense | $ | 0.9 | $ | 0.1 | $ | 0.6 | |||||||||||
| ESPP expense | 0.2 | — | 0.5 | ||||||||||||||
| RSU, DSU and PSU expense | 17.2 | 11.8 | 9.5 | ||||||||||||||
Total share-based compensation expense (1) | $ | 18.3 | $ | 11.9 | $ | 10.6 | |||||||||||
| Income tax benefit | (3.3) | (2.6) | (2.3) | ||||||||||||||
| Total share-based compensation expense, net of tax | $ | 15.0 | $ | 9.3 | $ | 8.3 | |||||||||||
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(1) Substantially all compensation expense related to share-based awards is recorded as a component of "Selling, general and administrative expenses" within the consolidated statements of operations.
Stock Options
All stock options vest in accordance with vesting conditions set by the Compensation Committee. The Compensation Committee, did not grant stock options in 2024 or 2023. Stock options granted to date have vesting periods of to four years from the date of grant. Incentive and non-qualified options granted under the Plan expire no later than 10 years from the grant date. Expense related to stock options granted is based on the assumptions shown in the table below:
| Years Ended December 31, | |||||||||||||||||
| Weighted-average assumptions used to calculate expense for stock options | 2025 | 2024 | 2023 | ||||||||||||||
| Risk-free interest rate | 3.9 | % | — | % | — | % | |||||||||||
| Average life of options (years) | 6.3 | 0.0 | 0.0 | ||||||||||||||
| Volatility | 47.1 | % | — | % | — | % | |||||||||||
| Dividend yield | — | — | — | ||||||||||||||
| Fair value per stock option | $ | 16.23 | $ | — | $ | — | |||||||||||
The following table summarizes Ingevity's stock option activity.
Number of Options (in thousands) | Weighted-average exercise price (per share) | Weighted-average remaining contractual term (years) | Aggregate intrinsic value (in thousands) | ||||||||||||||||||||
| Outstanding, December 31, 2024 | 257 | $ | 63.12 | 3.0 | $ | 510 | |||||||||||||||||
| Granted | 123 | 31.73 | |||||||||||||||||||||
| Exercised | (34) | 29.59 | |||||||||||||||||||||
| Forfeited | (16) | 80.93 | |||||||||||||||||||||
| Cancelled | — | ||||||||||||||||||||||
| Outstanding, December 31, 2025 | 330 | $ | 53.99 | 5.0 | $ | 4,300 | |||||||||||||||||
| Exercisable, December 31, 2025 | 207 | $ | 67.25 | 2.4 | $ | 910 | |||||||||||||||||
The aggregate intrinsic values in the table above represent the total pre-tax intrinsic value (the difference between Ingevity's closing stock price on the last trading day of the period and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their in-the-money options at each year end. The amount changes based on the fair market value of Ingevity's stock.
As of December 31, 2025, $1.2 million of unrecognized compensation expense related to stock options is expected to be recognized over a weighted-average period of 1.8 years.
Restricted Stock Units, Deferred Stock Units, and Performance-based Restricted Stock Units
All RSUs, DSUs, and PSUs vest in accordance with vesting conditions set by the Compensation Committee. RSUs and DSUs granted to date have vesting periods ranging from less than one year to three years from the date of grant. PSUs granted to date have vesting periods of three years from the date of grant, including grants that have a cumulative three-year performance period, subject to the satisfaction of the applicable performance goals established for the respective grant. We periodically assess the probability of achievement of the performance criteria and adjust the amount of compensation expense accordingly. Beginning in 2023, certain granted PSUs include a Relative Total Shareholder Return ("rTSR") modifier that, when combined with the performance criteria could modify the final PSU payout by +/- 15 to 30 percent depending on the Company's rTSR performance over a three year performance period. The rTSR component of the 2024 PSU awards is a market condition requiring the use of a Monte Carlo simulation on the grant date to estimate the fair value that could modify the final PSU payout by +/- 25 percent depending on the Company's rTSR performance over a three year performance period. Beginning in 2025, certain granted PSUs include a rTSR metric. The rTSR component of the 2025 PSU awards is a market condition requiring the use of a Monte Carlo simulation on the grant date to estimate the fair value could modify the final PSU payout depending on the Company's rTSR performance over a three year performance period. The assumptions utilized to calculate the
fair value of the 2025 PSUs are shown in the table below. Compensation expense is recognized over the vesting period and adjusted for the probability of achievement of the performance criteria.
| Weighted-average assumptions used to calculate expense for PSUs | Year Ended December 31, 2025 | ||||
| Risk-free interest rate | 4.0 | % | |||
| Average life of awards (years) | 3.0 | ||||
| Volatility | 46.0 | % | |||
| Dividend yield | — | ||||
| Fair value per PSU | $ | 39.46 | |||
The following table summarizes Ingevity's RSUs, DSUs, and PSUs activity.
| RSUs and DSUs | PSUs | ||||||||||||||||||||||
Number of Units (in thousands) (1) | Weighted average grant date fair value (per share) | Number of Units (in thousands) (1) | Weighted average grant date fair value (per share) | ||||||||||||||||||||
Nonvested, December 31, 2024 | 483 | $ | 52.82 | 213 | $ | 65.44 | |||||||||||||||||
| Granted | 399 | 41.96 | 237 | 36.37 | |||||||||||||||||||
| Vested | (211) | 55.36 | (16) | 68.23 | |||||||||||||||||||
| Forfeited | (65) | 46.44 | (117) | 64.29 | |||||||||||||||||||
Nonvested, December 31, 2025 (2) | 606 | $ | 45.58 | 317 | $ | 43.97 | |||||||||||||||||
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(1) The number granted represents the number of shares issuable upon vesting of RSUs and DSUs. For PSUs, the number granted represents the number of shares issuable upon vesting, assuming that Ingevity performs at the target performance level in each year of the three-year performance period.
(2) Excludes 30,296 non-employee director shares that were vested but unissued at December 31, 2025.
As of December 31, 2025, $17.4 million of unrecognized share-based compensation expense related to RSUs, DSUs and PSUs is expected to be recognized over a weighted-average period of 1.3 years.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 26, 2026 | Showing above |
| 2024 | Feb 19, 2025 | |
| 2023 | Feb 22, 2024 | |
| 2022 | Feb 28, 2023 | |
| 2021 | Feb 24, 2022 | |
| 2020 | Feb 19, 2021 | |
| 2019 | Feb 26, 2020 | |
| 2018 | Feb 20, 2019 | |
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.