ProPetro Holding Corp.PUMP
ProPetro Holding Corp. Stock Compensation Disclosure
STOCK‑BASED COMPENSATION
Stock Option Plan
In March 2013, we approved the Stock Option Plan of ProPetro Holding Corp. (the “Stock Option Plan”) pursuant to which our Board may grant stock options to our consultants, directors, executives and employees. No awards have been granted under the Stock Option Plan following our Initial Public Offering, and no further awards will be granted under the Stock Option Plan. As of December 31, 2025, there were no awards outstanding under the Stock Option Plan.
2017 Incentive Award Plan
In March 2017, our shareholders approved the ProPetro Holding Corp. 2017 Incentive Award Plan (the “2017 Incentive Plan”) pursuant to which our Board was authorized to grant stock options, RSUs, PSUs, or other stock-based and cash awards to consultants, directors, executives and employees. The 2017 Incentive Plan originally authorized up to 5,800,000 shares of common stock to be issued with respect to awards granted pursuant to the plan. No awards have been granted under the 2017 Incentive Plan following approval of the 2020 Incentive Plan (as defined below), and no further awards will be granted under the 2017 Incentive Plan.
2020 Long Term Incentive Plan
In October 2020, our shareholders approved the ProPetro Holding Corp. 2020 Long Term Incentive Plan (the “2020 Incentive Plan”) pursuant to which our Board may grant stock options, RSUs, PSUs, or other stock-based and cash awards to consultants, directors, executives and employees. The 2020 Incentive Plan authorized up to 4,650,000 shares of common stock to be issued under awards granted pursuant to the plan. The 2020 Incentive Plan became effective on October 22, 2020, and as of such date no further awards will be granted under the 2017 Incentive Plan. In May 2023, our stockholders approved the Amended and Restated ProPetro Holding Corp. 2020 Long Term Incentive Plan (the “A&R 2020 Incentive Plan”) and in May 2025, approved the Second Amended and Restated ProPetro Holding Corp. 2020 Long Term Incentive Plan (the “Second A&R 2020 Incentive Plan”), which had been previously approved by the Board. The Second A&R 2020 Incentive Plan became effective on May 20, 2025, and replaced the A&R 2020 Incentive Plan. The Second A&R 2020 Incentive Plan authorizes up to 10,520,000 shares of common stock to be issued under awards granted pursuant to the plan in lieu of the 8,050,000 shares of common stock available for issuance under the A&R 2020 Incentive Plan.
The 2017 Incentive Plan, the A&R 2020 Incentive Plan and the Second A&R 2020 Incentive Plan are herein collectively referred to as the “Incentive Plans.”
Stock Options
On March 16, 2017, we granted 793,738 stock option awards to certain key employees, officers and directors pursuant to the 2017 Incentive Plan which were scheduled to vest in four substantially equal annual installments, subject to a continuing service requirement. The contractual term for the options awarded is 10 years. The fair value of each stock option award granted was estimated on the date of grant using the Black-Scholes option-pricing model. There were no new stock option grants during the years ended December 31, 2025, 2024, and 2023.
As of December 31, 2025, there was no aggregate intrinsic value for our outstanding or exercisable stock options because the closing stock price as of December 31, 2025, was below the cost to exercise the options. No stock options were exercised during the year ended December 31, 2025. The weighted average remaining contractual term for the outstanding and exercisable stock options as of December 31, 2025, was 1.2 years and 1.2 years, respectively.
A summary of the stock option activity during the year ended December 31, 2025, is presented below (in thousands, except for exercise price):
Number of Shares | Weighted Average Exercise Price | ||||||||||
| Outstanding at January 1, 2025 | 179 | $ | 14.00 | ||||||||
| Granted | — | $ | — | ||||||||
| Exercised | — | $ | — | ||||||||
| Forfeited | — | $ | — | ||||||||
Expired | (18) | $ | 14.00 | ||||||||
| Outstanding at December 31, 2025 | 161 | $ | 14.00 | ||||||||
| Exercisable at December 31, 2025 | 161 | $ | 14.00 | ||||||||
Restricted Stock Units
In 2025, we granted 1,785,354 RSUs to employees, officers and directors pursuant to the A&R 2020 Incentive Plan and the Second A&R 2020 Incentive Plan. RSUs granted to employees and officers generally vest ratably over a three-year vesting period, a two-year vesting period (at approximately one-third after the first year anniversary and approximately two-thirds after the second year anniversary) or a one-year vesting period. RSUs granted to directors generally vest in full after one year. RSUs are subject to restrictions on transfer and are generally subject to a risk of forfeiture if the award recipient ceases to be an employee or director of the Company prior to vesting of the award. Each RSU represents the right to receive one share of common stock. The grant date fair value of the RSUs is based on the closing share price of our common stock on the date of grant. For the years ended December 31, 2025, 2024, and 2023, the Company recognized stock compensation expense for RSUs of approximately $12.7 million, $11.9 million and $7.8 million, respectively.
As of December 31, 2025, the total unrecognized compensation expense for all RSUs was approximately $13.6 million, and is expected to be recognized over a weighted-average period of approximately 1.5 years.
The following table summarizes the RSUs activity during the year December 31, 2025 (in thousands, except for fair value):
| Number of Shares | Weighted Average Grant Date Fair Value ("FV") | |||||||||||||
| Outstanding at January 1, 2025 | 3,001 | $ | 8.54 | |||||||||||
| Granted | 1,785 | $ | 7.31 | |||||||||||
| Vested | (1,573) | $ | 9.11 | |||||||||||
| Forfeited | (335) | $ | 7.76 | |||||||||||
| Canceled | — | $ | — | |||||||||||
| Outstanding at December 31, 2025 | 2,878 | $ | 7.56 | |||||||||||
Performance Stock Units
In 2025, we granted 950,000 PSUs to certain key employees and officers as new awards under the A&R 2020 Incentive Plan and the Second A&R 2020 Incentive Plan. Each PSU earned represents the right to receive either one share of common stock or, as determined by the administrator in its sole discretion, a cash amount equal to the fair market value of one share of common stock on the day immediately preceding the settlement date. The actual number of shares of common stock that may be issued under the majority of our PSUs ranges from 0% up to a maximum of 200% of the target number of PSUs granted to the participant, based on our total shareholder return (“TSR”) relative to a designated peer group of comparable companies (“Peer Group”), generally at the end of a three-year period. In addition to the TSR conditions, vesting of the PSUs is generally subject to the recipient’s continued employment through the end of the applicable performance period. The grant date fair value of these PSUs is determined using a Monte Carlo simulation. Additionally, the actual number of shares of common stock that may be issued under certain PSUs could be either 0%, 50% or 100% of the target number of PSUs granted contingent upon the attainment of pre-established performance goals over a period of up to four years. The grant date fair value of these PSUs is based on the closing share price of our common stock on the date of grant. Compensation expense is recorded ratably over the corresponding requisite service period. Grant recipients do not have any shareholder rights until performance relative to the Peer Group has been determined following the completion of the performance period and shares have been issued.
For the years ended December 31, 2025, 2024, and 2023, the Company recognized stock compensation expense for the PSUs of approximately $4.2 million, $5.4 million and $6.6 million, respectively.
The following table summarizes information about PSUs activity during the year ended December 31, 2025 (in thousands, except for fair value):
| Period Granted | Target Shares Outstanding at January 1, 2025 | Target Shares Granted | Target Shares Vested | Target Shares Forfeited | Target Shares Outstanding at December 31, 2025 | |||||||||||||||||||||||||||
| 2022 | 301 | — | (220) | (81) | — | |||||||||||||||||||||||||||
| 2023 | 431 | — | — | (68) | 363 | |||||||||||||||||||||||||||
| 2024 | 633 | — | — | (105) | 528 | |||||||||||||||||||||||||||
| 2025 | — | 950 | — | (3) | 947 | |||||||||||||||||||||||||||
| Total | 1,365 | 950 | (220) | (257) | 1,838 | |||||||||||||||||||||||||||
| Weighted Average Fair Value Per Share | $ | 12.77 | $ | 9.76 | $ | 19.99 | $ | 13.59 | $ | 10.24 | ||||||||||||||||||||||
The total stock compensation expense for the years ended December 31, 2025, 2024 and 2023 for all stock awards was approximately $16.9 million, $17.3 million and $14.5 million, respectively, and the associated tax benefit related thereto was $3.6 million, $3.6 million and $3.0 million, respectively. The total unrecognized stock-based compensation expense as of December 31, 2025 was approximately $22.6 million, and is expected to be recognized over a weighted-average period of approximately 1.5 years.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 19, 2026 | Showing above |
| 2024 | Feb 20, 2025 | |
| 2023 | Mar 13, 2024 | |
| 2022 | Feb 23, 2023 | |
| 2019 | Jun 22, 2020 | |
| 2018 | Mar 1, 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.