BOISE CASCADE Co

8. Stock-Based Compensation

During the three months ended March 31, 2026 and 2025, we grantedtwo types of stock-based awards: performance stock units (PSUs) and restricted stock units (RSUs).

PSU and RSU Awards

During the three months ended March 31, 2026, we granted 91,368 PSUs to our officers and other employees, subject to performance and service conditions. For the officers, the PSUs granted are subject to athree-year performance period. The number of shares actually awarded will range from 0% to 200% of the target amount. Achievement is measured in annual sub-periods, based on Boise Cascade's return on invested capital (ROIC) for 2026, 2027, and 2028. The average achievement for thethree years included in the performance period will determine the number of earned PSUs, as approved by our compensation committee in accordance with the related grant agreement. We define ROIC as net operating profit after taxes (NOPAT) divided by average invested capital (based on a rolling thirteen-month average). We define NOPAT as net income plus after-tax financing expense. Invested capital is defined as total assets plus capitalized lease expense, less cash, cash equivalents, and current liabilities, excluding short-term debt. For the other employees, the PSUs granted are subject to aone-year performance period. The number of shares actually awarded will range from 0% to 200% of the target amount, depending upon Boise Cascade’s 2026 EBITDA, defined as income before interest (interest expense and interest income), income taxes, and depreciation and amortization, as approved by executive management, determined in accordance with the related grant agreement. During the three months ended March 31, 2025, we granted 83,616 PSUs to our officers and other employees, subject to performance and service conditions. For both periods, the PSUs granted to officers generally vest in a single installment three years from the date of grant, while the PSUs granted to other employees vest inthree equal tranches each year after the grant date.

During the three months ended March 31, 2026 and 2025, we granted an aggregate of 111,613 and 98,327 RSUs, respectively, to our officers, other employees, and nonemployee directors with only service conditions. The RSUs granted to officers and other employees vest inthree equal tranches each year after the grant date. The RSUs granted to nonemployee directors vest in a single installment after aone year period.

We based the fair value of PSU and RSU awards on the closing market price of our common stock on the grant date. During the three months ended March 31, 2026 and 2025, the total fair value of PSUs and RSUs vested was $17.2 million and $15.7 million, respectively.

The following summarizes the activity of our PSUs and RSUs awarded under our incentive plan for the three months ended March 31, 2026:

(a) Represents total PSUs forfeited during the three months ended March 31, 2026, related to below-target achievement of the 2025 performance condition on awards granted to other employees in 2025. During the 2025 performance period, other employees earned 63% of the target based on Boise Cascade's 2025 EBITDA, determined by executive management, in accordance with the related grant agreement.

Compensation Expense

We record compensation expense over the awards' vesting period and account for share-based award forfeitures as they occur, rather than making estimates of future forfeitures. Any shares not vested are forfeited. We recognize compensation expense for stock awards with performance and service conditions over the requisite service period based on the most probable number of shares expected to vest. We recognize compensation expense for stock awards with only service conditions on a straight-line basis over the requisite service period. Most of our stock-based compensation expense was recorded in "General and administrative expenses" in our Consolidated Statements of Operations. Total stock-based compensation recognized from PSUs and RSUs, net of forfeitures, was as follows:

The related tax benefit for the three months ended March 31, 2026 and 2025, was $0.9 million and $1.0 million, respectively. As of March 31, 2026, total unrecognized compensation expense related to nonvested share-based compensation arrangements was $25.2 million. This expense is expected to be recognized over a weighted-average period of 2.2 years.