UNIVERSAL INSURANCE HOLDINGS, INC.UVE
UNIVERSAL INSURANCE HOLDINGS, INC. Stock Compensation Disclosure
SHARE-BASED COMPENSATION
Equity Compensation Plans
Prior to 2021 the Company managed its equity compensation under the 2009 Omnibus Incentive Plan (the “2009 Plan”). In April 2021, the Company’s Board of Directors adopted, subject to shareholder approval, the 2021 Omnibus Incentive Plan (the “2021 Plan”). The 2021 Plan was approved by the Company’s shareholders effective June 11, 2021, at which time the 2009 Plan was terminated. Shares reserved for future issuance under the 2009 Plan are no longer available and no further grants will be made under this plan.
At the inception of the Company’s 2021 Plan, 1,835,000 shares were initially reserved for issuance. At the 2024 Annual Meeting of Shareholders held on June 13, 2024, shareholders voted to approve the recommendations of the Company’s Board of Directors to amend the 2021 Plan to add 1,450,000 shares to the shares reserved for grant.
At December 31, 2025, 701,237 shares remained reserved for issuance for new awards under the 2021 Plan.
Awards under the 2021 Plan may include incentive stock options, non-qualified stock option awards (“Stock Options”), stock appreciation rights, non-vested shares of common stock, restricted stock awards (“RSAs”), performance share units (“PSUs”), restricted stock units (“RSUs”), and other share-based awards or cash-based incentive awards. Awards under the Incentive Plan may be granted to employees, directors, consultants or other persons providing services to the Company or its affiliates.
The following table provides certain information related to Stock Options, RSAs, PSUs and RSUs for the year ended December 31, 2025 (in thousands, except per share data):
| For the Year Ended December 31, 2025 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Stock Options | Restricted Stock Awards | Performance Share Units | Restricted Stock Units | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Number of Options (2) | Weighted Average Exercise Price per Share (1) | Aggregate Intrinsic Value | Weighted Average Remaining Term | Number of Shares (2) | Weighted Average Grant Date Fair Value per Share (1) | Number of Share Units (2) | Weighted Average Grant Date Fair Value per Share Units (1) | Number of Share Units (2) | Weighted Average Grant Date Fair Value per Share Units (1) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| 2009 Omnibus Plan | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Outstanding as of December 31, 2024 | 2,087 | $ | 21.33 | — | $ | — | — | $ | — | — | $ | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Granted | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Forfeited | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Exercised | (491) | 19.33 | n/a | n/a | n/a | n/a | n/a | n/a | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Vested | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Expired | — | — | n/a | n/a | n/a | n/a | n/a | n/a | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Outstanding as of December 31, 2025 | 1,596 | $ | 21.95 | $ | 18,928 | 3.46 | — | $ | — | — | $ | — | — | $ | — | |||||||||||||||||||||||||||||||||||||||||||||||
Exercisable as of December 31, 2025 | 1,596 | $ | 21.95 | $ | 18,928 | 3.46 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| 2021 Omnibus Plan | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Outstanding as of December 31, 2024 | 500 | $ | 12.50 | 28 | $ | 18.62 | 258 | $ | 19.15 | 634 | $ | 17.81 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Granted | — | — | 347 | 23.27 | 90 | 21.50 | 262 | 27.72 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Forfeited | — | — | — | — | — | — | (25) | 16.17 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Exercised | (250) | 13.19 | n/a | n/a | n/a | n/a | n/a | n/a | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Vested | n/a | n/a | (28) | 18.62 | (103) | 12.19 | (286) | 16.34 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Expired | — | — | n/a | n/a | n/a | n/a | n/a | n/a | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Outstanding as of December 31, 2025 | 250 | $ | 11.80 | $ | 5,500 | 6.17 | 347 | $ | 23.27 | 245 | $ | 20.01 | 585 | $ | 23.05 | |||||||||||||||||||||||||||||||||||||||||||||||
Exercisable as of December 31, 2025 | 250 | $ | 11.80 | $ | 5,500 | 6.17 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(1)Unless otherwise specified, such as in the case of the exercise of Stock Options, the per share prices were determined using the closing price of the Company’s common stock as quoted on the exchanges on which the Company was listed. Shares issued upon exercise of options represent original issuances in private transactions pursuant to Section 4(2) of the Securities Act of 1933, as amended or issuances under the Company’s 2009 or 2021 Plan.
(2)All shares outstanding as of December 31, 2025, are expected to vest.
| n/a | Not applicable | ||||
The following table provides certain information in connection with the Company’s share-based compensation arrangements for the periods presented (in thousands):
| Years Ended December 31, | ||||||||||||||||||||
| 2025 | 2024 | 2023 | ||||||||||||||||||
| Compensation expense: | ||||||||||||||||||||
| Stock options | $ | 62 | $ | 328 | $ | 996 | ||||||||||||||
Restricted stock awards | 1,479 | 561 | 588 | |||||||||||||||||
| Performance share units | 2,612 | 3,371 | 868 | |||||||||||||||||
| Restricted stock units | 5,278 | 4,367 | 2,554 | |||||||||||||||||
| Total | $ | 9,431 | $ | 8,627 | $ | 5,006 | ||||||||||||||
| Deferred tax benefits: | ||||||||||||||||||||
| Stock options | $ | — | $ | — | $ | 41 | ||||||||||||||
Restricted stock awards | — | — | — | |||||||||||||||||
| Performance share units | — | — | — | |||||||||||||||||
| Restricted stock units | 759 | 817 | 481 | |||||||||||||||||
| Total | $ | 759 | $ | 817 | $ | 522 | ||||||||||||||
| Realized tax benefits: | ||||||||||||||||||||
| Stock options | $ | 407 | $ | — | $ | 82 | ||||||||||||||
Restricted stock awards | 182 | 165 | 207 | |||||||||||||||||
| Performance share units | — | — | — | |||||||||||||||||
| Restricted stock units | 1,954 | 1,183 | 501 | |||||||||||||||||
| Total | $ | 2,543 | $ | 1,348 | $ | 790 | ||||||||||||||
| Excess tax benefits (shortfall): | ||||||||||||||||||||
| Stock options | $ | 16 | $ | (1,599) | $ | 7 | ||||||||||||||
Restricted stock awards | 53 | 21 | 47 | |||||||||||||||||
| Performance share units | — | — | — | |||||||||||||||||
| Restricted stock units | 1,040 | 373 | (34) | |||||||||||||||||
| Total | $ | 1,109 | $ | (1,205) | $ | 20 | ||||||||||||||
| Weighted average fair value per option or share: | ||||||||||||||||||||
Restricted stock awards grants | $ | 23.27 | $ | 18.62 | $ | 16.23 | ||||||||||||||
| Performance share unit grants | $ | 21.50 | $ | 19.98 | $ | 18.26 | ||||||||||||||
| Restricted stock unit grants | $ | 27.72 | $ | 20.49 | $ | 16.68 | ||||||||||||||
| Intrinsic value of options exercised | $ | 6,336 | $ | 2 | $ | 315 | ||||||||||||||
Fair value of restricted stock awards vested | $ | 738 | $ | 671 | $ | 843 | ||||||||||||||
| Fair value of performance share units vested | $ | 2,160 | $ | — | $ | 164 | ||||||||||||||
| Fair value of restricted stock units vested | $ | 9,155 | $ | 5,188 | $ | 3,108 | ||||||||||||||
| Cash received for strike price and tax withholdings | $ | — | $ | — | $ | 41 | ||||||||||||||
| Shares acquired through cashless exercise (1) | 721 | 70 | 104 | |||||||||||||||||
| Value of shares acquired through cashless exercise (1) | $ | 18,889 | $ | 1,473 | $ | 339 | ||||||||||||||
(1)All shares acquired represent shares tendered to cover the strike price for options and tax withholdings on the intrinsic value of Stock Options exercised, RSA vested, PSUs vested or RSUs vested. These shares have been canceled by the Company.
The following table provides the amount of unrecognized compensation expense as of the most recent balance sheet date and the weighted average period over which those expenses will be recorded for RSAs, PSUs, and RSUs (dollars in thousands):
| As of December 31, 2025 | |||||||||||||||||||||||
Restricted Stock Awards | Performance Share Units | Restricted Stock Units | |||||||||||||||||||||
| Unrecognized expense | $ | 6,831 | $ | 1,959 | $ | 11,967 | |||||||||||||||||
| Weighted average remaining years | 3.7 | 1.70 | 2.25 | ||||||||||||||||||||
Stock Options
Stock Options granted by the Company generally expire between to ten years from the grant date and generally vested over a - to three-year service period commencing on the grant date.
The Company uses the modified Black-Scholes model to estimate the fair value of employee Stock Options on the date of grant. The risk-free rate is based on the U.S. Treasury bill yield curve in effect at the time of grant for the expected term of the option. The expected term of options granted represented the period of time that the options are expected to be outstanding. Expected volatilities are based on historical volatilities of our Common Stock. The dividend yield is based on expected dividends at the time of grant.
Restricted Stock Awards, Performance Share Units and Restricted Stock Units
Restricted Stock Awards, Performance Share Units and Restricted Stock Units are awarded to certain employees in consideration for services rendered pursuant to terms of employment agreements or to provide employees a continued incentive to share in the success of the Company. Dividend equivalents are accrued on RSUs, PSUs and RSAs during the vesting period and paid out in cash at the time based on the final number of shares awarded.
Restricted Stock Awards generally vest over a - to three-year or - to five-year service period commencing on the grant date and are generally settled in common stock upon vesting (but may be cash settled to the extent that such is determined appropriate in the Compensation Committee’s discretion).
Each performance share unit has a value equal to one share of common stock and generally vests following the conclusion of a three-year performance period, but only to the extent that the performance criteria are met. The units are paid 100% in common stock should conditions be met and can range from 0% to 200% of the target award.
Each restricted stock unit has a value equal to one share of common stock and generally vests over a - to three-year service period commencing on the grant date and is generally settled in common stock upon vesting (but may be cash settled to the extent that such is determined appropriate in the Compensation Committee’s discretion). See “—Note 2 (Summary of Significant Accounting Policies — Share-based Compensation)” for additional information.
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.