Vishay Precision Group, Inc. Stock Compensation Disclosure

Note 10 – Share-Based Compensation

 

The Vishay Precision Group, Inc. 2022 Stock Incentive Plan (the "2022 plan") permits the issuance of up to 608,000 shares of common stock. At December 31, 2025 the Company had reserved 378,739 shares of common stock for future grant of equity awards (restricted stock, unrestricted stock, restricted stock units (“RSUs”), or stock options) pursuant to the 2022 Plan. If any outstanding awards are forfeited by the holder or canceled by the Company, the underlying shares would be available for re-grant to others. If shares are withheld for payment of taxes, those shares do not become available for future grant under the 2022 plan.

 

Restricted Stock Units

 

Pursuant to the 2022 plan, the Company issued RSUs to board members, executive officers, and certain employees of the Company during 2025. The amount of compensation cost related to share-based payment transactions is measured based on the grant-date fair value of the equity instruments issued. VPG determines compensation cost for RSUs based on the grant-date fair value of the underlying common stock. Compensation cost is recognized over the period that the participant provides service in exchange for the award. The Company recognizes compensation cost for RSUs that are expected to vest and for which performance criteria are expected to be met.

 

On February 25, 2025 and in accordance with their respective employment agreements, VPG’s three executive officers were granted annual equity awards in the form of RSUs, of which 50% are performance-based. The awards have an aggregate grant-date fair value of $1.9 million and were comprised of 79,729 RSUs. Fifty percent of these awards will vest on January 1, 2028, subject to the executives’ continued employment. The performance-based portion of the RSUs will also vest on January 1, 2028, subject to the executives' continued employment and the satisfaction of certain performance objectives relating to three-year cumulative “adjusted free cash flow” and "net earnings goals", each weighted equally.

 

On February 25, 2025, certain non-executive VPG employees were granted annual equity awards in the form of RSUs. Certain employees received awards, of which 75% are performance-based and certain employees received awards of which 50% are performance-based. The awards have an aggregate grant-date fair value of $0.4 million and were comprised of 18,282 RSUs. The non-performance portion of these awards (twenty-five percent for certain employees and fifty percent for certain employees) will vest on January 1, 2028, subject to the employees' continued employment. The performance-based portion of the RSUs will also vest on January 1, 2028, subject to the employees' continued employment and the satisfaction of certain performance objectives relating to three-year cumulative earnings and cash flow goals, each weighted equally.

 

On May 21, 2025, and in accordance with the Company's 2025 Non-Employee Director Compensation Plan, the Board of Directors ("Board") approved the issuance of an aggregate of 18,252 RSUs to the independent board members of the Board. The awards had an aggregate grant-date fair value of $0.5 million and will vest on or before the 2026 Annual Stockholders Meeting in May 2026, subject to each applicable director's continued service on the Board. Vesting of equity awards is subject to acceleration under certain circumstances.

 

On July 1, 2025, certain non-executive VPG employees were granted annual equity awards in the form of RSUs. One employee received an award, of which 75% is performance-based and one employee received an award of which 50% is performance-based. The awards have an aggregate grant-date fair value of $0.1 million and were comprised of 2,444 RSUs. The non-performance portion of these awards will vest on July 1, 2028, subject to the employees' continued employment. The performance-based portion of the RSUs will also vest on July 1, 2028, subject to the employees' continued employment and the satisfaction of certain performance objectives relating to three-year cumulative earnings and cash flow goals, each weighted equally.

 

Note 10 – Share-Based Compensation (continued)

 

The amount of compensation cost related to share-based payment transactions is measured based on the grant-date fair value of the equity instruments issued. VPG determines compensation cost for RSUs based on the grant-date fair value of the underlying common stock. The Company recognizes compensation cost for RSUs that are expected to vest and for which performance criteria are expected to be met. The following table summarizes share-based compensation expense recognized (in thousands):

 

Vesting of equity awards may be subject to acceleration under certain circumstances.

 

RSU activity is presented below (number of RSUs in thousands):

 

		Years ended December 31,
		2025								2024								2023
						Weighted								Weighted								Weighted
		Number				Average				Number				Average				Number				Average
		of				Grant-date				of				Grant-date				of				Grant-date
		RSUs				Fair Value				RSUs				Fair Value				RSUs				Fair Value
Outstanding:
Beginning of year			232			$	35.79				202			$	35.50				204			$	29.92
Granted			119				24.29				85				34.48				72				42.09
Vested			(40	)			24.93				(55	)			32.68				(67	)			26.54
Forfeited			(38	)			24.76				—				—				(7	)			24.85
End of year			273			$	33.90				232			$	35.79				202			$	35.50

 

The fair value of the RSUs vested during 2025 was $1.0 million. Included in the 2025, 2024 and 2023 activity are RSU's forfeited as a result of performance objectives not being met. These awards are therefore available for future grants under the Plan.

 

None of the RSUs with performance-based criteria is expected to vest in the coming three years period.

 

Share-Based Compensation Expense

 

The following table summarizes pre-tax share-based compensation expense recognized (in thousands):

 

		Years ended December 31,
		2025				2024				2023
Restricted stock units		$	1,792			$	971			$	2,290

 

Share- based compensation expense is recognized ratably over the vesting period of the awards and for RSUs with performance criteria, is recognized for RSU's that are expected to vest and for which performance criteria are expected to be met.

 

During 2025, a net adjustment of $0.8 million decreasing share-based compensation expense was recorded, based on the evaluation of performance objectives associated with awards granted in 2023, 2024 and 2025. It was determined that certain objectives were not likely to be fully met, necessitating a reversal of certain compensation expense associated with those awards.

 

During 2024, a net adjustment of $1.5 million decreasing share-based compensation expense was recorded, based on the evaluation of performance objectives associated with awards granted in 2022, 2023 and 2024. It was determined that certain objectives were not likely to be fully met, necessitating a reversal of certain compensation expense associated with those awards. During 2023, a net adjustment of $0.4 million decreasing share-based compensation expense was recorded, based on the evaluation of performance objectives associated with awards granted in 2021, 2022 and 2023. It was determined that certain objectives were not likely to be fully met, necessitating a reversal of certain compensation expense associated with those awards

 

Note 10 – Share-Based Compensation (continued)

 

The total tax benefit on share-based compensation expense was $0.4 million, $0.2 million and $0.5 million for the years ended December 31, 2025, 2024 and 2023, respectively. The deferred tax benefit (expense) on share-based compensation expense was $0.05 million, $(0.3) million, and $0.1 million for the years ended December 31, 2025, 2024 and 2023, respectively.

 

As of December 31, 2025, the Company had $2.2 million of unrecognized share-based compensation expense related to share-based awards that expected to be recognized over a weighted-average period of approximately 1.4 years.