MADISON GAS & ELECTRIC CO

ompensation - MGE Energy and MGE.

During the three and nine months ended September 30, 2026, MGE recorded $0.7 million and $3.4 million, respectively, in compensation expense related to share-based compensation awards compared to $0.8 million and $2.5 million, respectively, for the comparable periods in 2025.

In the first quarter of 2026, participants received cash payments totaling $1.7 million and 22,050 shares of common stock upon settlement of awards granted in 2023 to employees and non-employee directors, and in 2025 to non-employee directors, under the 2021 Incentive Plan.

In March 2026, MGE granted 24,879 performance units and 34,230 restricted stock units under the 2021 Incentive Plan to eligible employees and non-employee directors. In April 2026, MGE granted 25,000 restricted stock units under the 2021 Incentive Plan to eligible employees.

Share-based compensation expense is recognized on a straight-line basis over the requisite service period. Awards classified as equity awards are measured based on their grant-date fair value. Awards classified as liability awards are recorded at fair value each reporting period. The performance units can be paid out in cash, shares of common stock, or a combination of cash and stock and are classified as a liability award. The restricted stock units will be paid out in shares of common stock and therefore are classified as equity awards.

Commitmen