Solaris Energy Infrastructure, Inc.SEI
Solaris Energy Infrastructure, Inc. Stock Compensation Disclosure
Stock-Based Compensation
Total stock-based compensation cost expensed in the statements of operations amounted to $23.4 million, $10.6 million and $7.7 million for the years ended December 31, 2025, 2024 and 2023, respectively.
The tax benefit related to stock-based compensation was $3.3 million, $1.6 million and $1.2 million for the years ended December 31, 2025, 2024 and 2023, respectively.
Total stock-based compensation costs capitalized into property, plant, and equipment were $0.7 million, $0.6 million and 0.5 million for the years ended December 31, 2025, 2024 and 2023, respectively.
As of December 31, 2025, there was $38.0 million of total unrecognized compensation cost related to non-vested stock-based compensation arrangements, which is expected to be recognized over a weighted average period of 2.1 years.
The Company’s long-term incentive plan, as amended (the “LTIP”), for employees, directors and consultants provides for the grant of any or all of the following types of stock-based awards: (i) incentive stock options qualified as such under United States federal income tax laws; (ii) stock options that do not qualify as incentive stock options; (iii) stock
appreciation rights; (iv) restricted stock awards; (v) restricted stock units; (vi) bonus stock; (vii) performance awards; (viii) dividend equivalents; (ix) other stock-based awards; (x) cash awards; and (xi) substitute awards.
In accordance with the LTIP, 11,418,080 shares of Class A common stock were reserved for issuance for stock-based awards. As of December 31, 2025, 4,776,708 shares of Class A common stock remained available for future grants. Shares of Class A common stock withheld to satisfy exercise prices or tax withholding obligations are returned to the LTIP share pool and are available for reissue pursuant to other awards. The LTIP is administered by the Board, the Compensation Committee of the Board or an alternative committee appointed by the Board.
Below is a discussion of each of our active stock-based compensation arrangements.
Restricted Stock Awards
Restricted stock awards under the LTIP are subject to restrictions on sale or transfer, which generally lapse ratably over a three-year service period. In certain circumstances, such as change in control, these restrictions may be lapse earlier in accordance with the Company's established policies. Prior to vesting, holders of restricted stock awards are entitled to participate in dividends and have voting rights.
The fair market value of the underlying Class A common stock on the grant date is recognized as compensation expense on a straight-line basis over the requisite service period. The total fair value of shares vested was $11.0 million, $7.5 million and 6.3 million during 2025, 2024 and 2023, respectively.
The following table summarizes restricted stock activity during the years ended December 31:
| 2025 | 2024 | 2023 | |||||||||||||||||||||||||||||||||
| Number of Shares | Weighted Average Grant Date Fair Value per Share | Number of Shares | Weighted Average Grant Date Fair Value per Share | Number of Shares | Weighted Average Grant Date Fair Value per Share | ||||||||||||||||||||||||||||||
| Unvested at beginning of year | 2,039,321 | $ | 9.25 | 1,481,111 | $ | 9.93 | 1,295,728 | $ | 10.33 | ||||||||||||||||||||||||||
| Granted | 1,014,465 | $ | 36.66 | 1,368,746 | $ | 9.18 | 944,408 | $ | 9.34 | ||||||||||||||||||||||||||
| Vested | (1,045,497) | $ | 10.55 | (752,985) | $ | 9.93 | (641,758) | $ | 9.87 | ||||||||||||||||||||||||||
| Forfeited | (56,984) | $ | 21.44 | (57,551) | $ | 8.76 | (117,267) | $ | 9.98 | ||||||||||||||||||||||||||
| Unvested at end of year | 1,951,305 | $ | 21.29 | 2,039,321 | $ | 9.25 | 1,481,111 | $ | 9.93 | ||||||||||||||||||||||||||
Performance-based Restricted Stock Units
The Company grants performance-based restricted stock units (“PSUs”) to certain key employees. The actual number of shares earned at the end of each performance period is determined based on the Company’s achievement of predefined targets in the PSU agreement. The number of PSUs that may vest and settle in shares of Class A common stock ranges from 0% to 200% of the target award, depending on performance achieved. The performance criteria for the PSUs are split as follows:
•Relative PSUs: 50% of the PSUs are based on total shareholder return (“TSR”) relative to a predetermined peer group, calculated at the end of the performance period.
•Absolute PSUs: 50% of the PSUs are based on absolute TSR, calculated at the end of the performance period.
The PSUs are subject to a service condition, generally requiring continuous employment over a period of approximately to three years from the grant date, depending on the applicable performance period. The PSUs may be settled in shares of Class A common stock or in cash, at the Company’s election. Dividends accrue on PSUs and are generally paid upon vesting.
The grant date fair value of the PSUs is determined using a Monte Carlo simulation method. The assumptions used in the Monte Carlo valuation are summarized in the table below. The risk-free interest rate used in the valuation was based on the U.S. Treasury rate for a term commensurate with the expected term of the awards. The resulting fair value is recognized as compensation expense on a straight-line basis over the requisite service period. The total fair value of shares vested was $3.7 million and $0.2 million during 2025 and 2024, respectively. No shares vested in 2023.
| 2025 | 2024 | 2023 | |||||||||||||||
| Risk-free interest rate | 4.0 | % | 4.3 | % | 4.6 | % | |||||||||||
| Volatility | 62.5 | % | 52.4 | % | 58.9 | % | |||||||||||
The following table summarizes PSU activity during the years ended December 31:
| 2025 | 2024 | 2023 | |||||||||||||||||||||||||||||||||
| Number of Units | Weighted-Average Grant Date Fair Value per Unit | Number of Units | Weighted-Average Grant Date Fair Value per Unit | Number of Units | Weighted-Average Grant Date Fair Value per Unit | ||||||||||||||||||||||||||||||
| Unvested at beginning of year | 413,440 | $ | 11.72 | 172,212 | $ | 11.92 | — | $ | — | ||||||||||||||||||||||||||
| Granted | 175,612 | $ | 51.96 | 262,752 | $ | 11.47 | 176,898 | $ | 11.92 | ||||||||||||||||||||||||||
| Vested | (54,365) | (1) | $ | 34.15 | (21,524) | (2) | $ | 10.19 | — | $ | — | ||||||||||||||||||||||||
| Forfeited | — | $ | — | — | $ | — | (4,686) | $ | 11.92 | ||||||||||||||||||||||||||
| Unvested at end of year | 534,687 | $ | 22.66 | 413,440 | $ | 11.72 | 172,212 | $ | 11.92 | ||||||||||||||||||||||||||
(1)Based on actual performance achieved versus target, the awards vested at 200%, resulting in PSUs representing 108,730 shares that were settled in cash.
(2)Based on actual performance achieved versus target, PSUs representing 16,910 shares were settled upon vesting.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 27, 2026 | Showing above |
| 2024 | Mar 5, 2025 | |
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.