Pursuant to our Amended and Restated Incentive Compensation Plan (the “Incentive Plan”), at any time prior to April 12, 2031, we can grant stock-based awards in the form of restricted stock, restricted stock units, and stock options to team members, officers, directors, and contractors. On April 12, 2021, our board of directors approved an amendment to the Incentive Plan, subject to shareholder approval, increasing the number of shares authorized for issuance by 750,000 shares, to 2,750,000 shares. Shareholder approval was received at our annual meeting of shareholders on July 21, 2021. The shares available for future grants under the Incentive Plan totaled 215,271 as of December 31, 2022.

We grant time-based stock options to team members and directors in accordance with the Incentive Plan. Based on the terms of individual stock option grant agreements, the stock options:

•vest and become exercisable in three or four equal annual installments beginning on the first anniversary of the date on which the options were granted, based on continuous employment or service, and

From December 2020 through June 2021, we granted 770,500 stock options, subject to shareholder approval of an amendment to the Incentive Plan (“Shareholder Approval”). Under GAAP, if a stock award is subject to shareholder approval, it is not considered granted for accounting purposes until that approval is received. Shareholder Approval was received at our annual meeting of shareholders on July 21, 2021. Accordingly, the accounting grant date of the 770,500 previously-awarded stock options is July 21, 2021, and no expense was recognized for those stock options prior to that date.


Stock Options	Number of Stock Options	Weighted Average Exercise Price Per Share		Aggregate Intrinsic Value (1) (in millions)		Weighted Average Remaining Contractual Term (in years)
Outstanding as of December 31, 2021	705,749	$	350.74
Granted	67,000	501.50
Exercised	(44,550)	340.35
Forfeited	(46,125)	363.75
Outstanding as of December 31, 2022	682,074	$	365.34	$	77.4	4.9
Exercisable as of December 31, 2022	244,454	$	344.89	$	31.8	4.5
Unvested as of December 31, 2022	437,620	$	376.77	$	45.6	5.1

(1)The intrinsic value of stock options is the amount by which the market price of the stock as of December 31, 2022 exceeded the exercise price of the options.

The grant-date weighted average fair value of stock options granted in 2022 was $501.50 per share. The total intrinsic value of stock options exercised during 2022 was $9.9 million. Net cash proceeds from the exercise of stock options in 2022 was $15.1 million.


Valuation Assumptions	2022
Risk-free interest rate	1.5%	-	4.4%
Expected stock price volatility	38.0%	-	41.0%
Expected life of stock options (in years)	3.5	-	4.0

We grant performance-based and time-based restricted stock units to team members and directors in accordance with the Incentive Plan. The grant-date fair value per share is estimated to equal the market price of our common stock on the date of grant. Each restricted stock unit represents and has a value equal to one share of common stock. Based on the terms of individual restricted stock unit grant agreements, restricted stock units vest under one of the following methods:

•For our former Chief Executive Officer, over a period of ten years, based on continuous employment and the cumulative improvement in our annual adjusted economic profit.

•For certain team members, over a period of one to four years, based on continuous employment and the compounded annual growth rate in our adjusted net income per diluted share, a non-GAAP financial measure.

•For certain directors, over a period of five years, based upon the compounded annual growth rate in our adjusted net income per diluted share, a non-GAAP financial measure.

A summary of the restricted stock unit (“RSU”) activity under the Incentive Plan for the year ended December 31, 2022, is presented below:


Restricted Stock Units	Number of Restricted Stock Units	Weighted Average Grant-Date Fair Value Per Share		Aggregate Intrinsic Value (2) (in millions)		Weighted Average Remaining Contractual Term (in years)
Outstanding as of December 31, 2021	376,835	$	143.70
Granted	22,867	488.27
Converted	(57,928)	126.25
Forfeited	(546)	437.63
Outstanding as of December 31, 2022 (1)	341,228	$	169.28	$	161.9	1.6
Vested as of December 31, 2022	312,872	$	142.40	$	148.4	1.4

The grant-date weighted average fair value of RSUs granted in 2022, 2021, and 2020 was $488.27, $366.07, and $436.89, respectively. The total intrinsic value of RSUs converted to common stock during 2022, 2021, and 2020 was $27.5 million, $7.9 million, and $7.6 million, respectively. During 2021, we recognized a $3.0 million reversal of stock-based compensation expense due to the forfeiture of 31,000 unvested RSUs upon the retirement of our former Chief Executive Officer in May 2021.

Prior to 2020, we granted performance-based and time-based shares of restricted stock to team members in accordance with the Incentive Plan. As of December 31, 2022, there were no unvested shares of restricted stock. During 2021, we recognized an $8.5 million reversal of stock-based compensation expense due to the forfeiture of 109,000 shares of unvested restricted stock upon the retirement of our former Chief Executive Officer in May 2021.


(In millions)	For the Years Ended December 31,
	2022		2021		2020
Stock options	$	33.8	$	33.7	$	—
Restricted stock units	2.7		(1.1)		4.2
Restricted stock	—		(7.8)		2.0
Total	$	36.5	$	24.8	$	6.2

Assuming performance targets are achieved in the periods currently estimated, we expect to recognize the remaining expense for stock-based awards outstanding as of December 31, 2022 over a weighted average period of 1.2 years, as follows:


(In millions)
For the Years Ended December 31,	Stock Options		Restricted Stock Units		Restricted Stock		Total Projected Expense
2023	$	34.4	$	3.5	$	—	$	37.9
2024	34.3		2.8		—		37.1
2025	5.2		2.2		—		7.4
2026	1.2		1.5		—		2.7
Total	$	75.1	$	10.0	$	—	$	85.1