Prior to the Separation, Crane NXT employees and directors participated in Holdings' equity incentive plans and received equity awards under those plans in the forms of stock options, restricted share units, performance-based and time-based restricted share units and deferred stock units in respect of Holdings common shares. Crane NXT Consolidated and Combined Financial Statements reflect compensation expense for these stock-based plans associated with the portion of the Holdings equity incentive plans in which Crane NXT employees and directors participated.

As a result of the Separation, all outstanding stock-based compensation awards of Holdings were exchanged for similarly valued stock-based compensation awards of either SpinCo, Crane NXT or both. The exchanged awards are subject to the same service vesting requirements as the original awards. Upon the exchange, there were 0.5 million options outstanding related to Crane NXT associates and 0.6 million options outstanding related to SpinCo associates.

There was no significant incremental stock-based compensation expense recorded as a result of the equity award conversions. The modification of the performance-based restricted share units resulted in a liability recorded upon Separation. The amount of the liability was $1.9 million as of December 31, 2023.

At December 31, 2023, we had stock-based compensation awards outstanding under the following shareholder-approved plans: the 2013 Stock Incentive Plan (the "2013 Plan"), 2018 Stock Incentive Plan (the "2018 Plan") and 2018 Amended and Restated Stock Incentive Plan (the “2018 Amended & Restated Plan”), applicable to employees and non-employee directors.

The 2013 Plan was approved by the Board of Directors and stockholders at the annual meeting in 2013. The 2013 Plan originally authorized the issuance of up to 9,500,000 shares of stock pursuant to awards under the plan. In 2018, in view of the limited number of shares remaining available under the 2013 Plan, the Board of Directors and stockholders approved the adoption of the 2018 Plan which authorized the issuance of up to 6,500,000 shares of Crane Holdings, Co. stock. In 2021, the Board of Directors and stockholders approved the adoption of the 2018 Amended and Restated Stock Incentive Plan which authorized the issuance of up to 4,710,000 shares of Crane Holdings, Co. stock. No further awards will be made under the 2013 Plan or 2018 Plan.

The stock incentive plans are used to provide long-term incentive compensation through stock options, restricted share units, performance-based restricted share units and deferred stock units.

Options are granted under the Stock Incentive Plan to officers and other key employees and directors at an exercise price equal to the closing price on the date of grant. Unless otherwise determined by the Compensation Committee which administers the plan, options vest in four installments of 25% per year over four years beginning on the first anniversary of the grant date. All options granted to directors and options granted to officers and employees after 2014 expire 10 years after the date of grant.

Prior to the Separation, Holdings determined the fair value of each grant using the Black-Scholes option pricing model. The weighted-average assumptions for grants made by Holdings during the years ended December 31, 2023, 2022 and 2021 are as follows:


	2023		2022		2021
Dividend yield	1.57	%	2.05	%	3.06	%
Volatility	32.33	%	33.96	%	36.28	%
Risk-free interest rate	3.67	%	1.92	%	0.50	%
Expected lives in years	7.7		7.2		5.2

Expected dividend yield is based on Holdings’ dividend rate. Expected stock volatility was determined based upon the historical volatility for the four-year period preceding the date of grant. The risk-free interest rate was based on the yield curve in effect at the time the options were granted, using U.S. constant maturities over the expected life of the option. The expected lives of the awards represent the period of time that options granted are expected to be outstanding.


Option Activity	Number of Shares (in 000’s)	Weighted Average Exercise Price		Weighted Average Remaining Life (Years)	Aggregate Intrinsic Value (in millions) (a)
Options outstanding as of January 1, 2023	—	$	—
Converted in Distribution (b)	563	34.42
Granted	—	—
Exercised	(49)	28.11
Canceled	(3)	31.36
Options outstanding as of December 31, 2023	511	$	35.04	6.92	$	11.2
Options exercisable as of December 31, 2023	230	$	26.81	4.97	$	6.9

(a) The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the estimated fair value of the common stock for in the money options at December 31, 2023.

Included in our stock-based compensation was expense recognized for our stock option awards of $4.8 million for the year ended December 31, 2023. For the years ended December 31, 2022 and 2021, $1.9 million and $2.0 million, respectively, were allocated to the Company.

The total net cash received from these option exercises during 2023 was $4.4 million and is reflected in the Consolidated and Combined Statement of Cash Flows as “Stock options exercised, net of shares reacquired” within financing activities. The total cash received from option exercises during 2022 and 2021 was $1.6 million and $1.5 million, respectively, and is reflected in the Consolidated and Combined Statements of Cash Flows as “Net transfers to Crane” within financing activities. The tax benefit realized for the tax deductions from these option exercises was $0.4 million, $0.3 million and $1.8 million as of December 31, 2023, 2022 and 2021, respectively.

As of December 31, 2023, there was $3.0 million of total future compensation cost related to unvested share-based awards to be recognized over a weighted-average period of 2.50 years.

Restricted share units vest in four installments of 25% per year over four years beginning on the first anniversary of the grant date and are subject to forfeiture restrictions which lapse over time. The vesting of performance-based restricted share units is determined based on relative total shareholder return for Crane NXT, Co. compared to the S&P Midcap 400 Capital Goods Group over a three year period, with payout potential ranging from 0% to 200% but capped at 100% if our three year total shareholder return is negative.

Included in our stock-based compensation was expense recognized for our restricted share unit and performance-based restricted share unit awards of $5.5 million. For the years ended December 31, 2022 and 2021, $7.4 million and $6.6 million, respectively, were allocated to the Company. The tax benefit for the vesting of the restricted share units was $0.5 million, $0.5 million and $0.1 million as of December 31, 2023, 2022 and 2021, respectively.

As of December 31, 2023, there was $10.2 million of total future compensation cost related to restricted share unit and performance-based restricted share unit awards, to be recognized over a weighted-average period of 2.08 years.


Restricted Share Unit Activity	Restricted Share Units (in 000’s)	Weighted Average Grant-Date Fair Value
Restricted share units as of January 1, 2023	—	$	—
Restricted share units converted in Distribution (a)	445	38.92
Restricted share units granted	36	49.24
Restricted share units vested	(32)	35.46
Restricted share units forfeited	(19)	37.69
Performance-based restricted share units granted	—	—
Performance-based restricted share units vested	(18)	30.88
Performance-based restricted share units forfeited	—	—
Restricted share units as of December 31, 2023	412	$	40.18