Note 14 — Deferred Compensation

Restricted Stock Units

The Company has adopted an equity incentive plan to motivate its employees and allow them to participate in the ownership of its stock. Under the Company’s plan, restricted stock units, which represent a right to a future payment equal to one share of common stock, may be awarded to employees, directors and certain other non-employees as selected by the Compensation Committee. Awards granted under the plan generally vest ratably over a period of up to four to five years beginning on the first anniversary of the grant date or in full on the fourth or fifth anniversary of the grant date. To the extent the restricted stock units are outstanding at the time a dividend is paid on the common stock, a dividend equivalent amount is paid to the holders of the restricted stock units. In the event that the holder’s employment is terminated under circumstances in which units awarded under the plan are forfeited any dividend equivalent payments related to such forfeiture, which are unvested for accounting purposes, are required to be repaid to the Company.

The activity related to the restricted stock units is set forth below:



	Restricted Stock Units Outstanding
	2017					2016
	Units			Grant Date Weighted Average Fair Value		Units			Grant Date Weighted Average Fair Value
Outstanding, January 1,	4,844,956			$	33.38	3,723,129			$	45.88
Granted	2,227,659		⁽¹⁾	20.87		2,407,173		⁽²⁾	21.61
Delivered	(1,219,193	)	⁽¹⁾	37.38		(871,226	)	⁽²⁾	52.27
Forfeited	(456,694	)		24.76		(414,120	)		37.66
Outstanding, December 31,	5,396,728			$	28.02	4,844,956			$	33.38

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(1)	Excludes 1,811,132 stock units granted and 931,180 stock units delivered to employees in connection with the annual awards granted and vested subsequent to December 31, 2017 as part of the long-term incentive awards program.


(2)	Excludes 973,946 stock units granted and 1,023,132 stock units delivered to employees in connection with the annual awards granted and vested subsequent to December 31, 2016 as part of the long-term incentive awards program.

For the years ended December 31, 2017, 2016 and 2015, the Company recognized compensation expense from the amortization of restricted stock units, net of forfeitures, of $40.2 million, $45.8 million and $46.5 million, respectively.

The weighted-average grant date fair value for restricted stock units granted during the years ended December 31, 2017, 2016 and 2015 was $20.87, $21.61 and $36.45, respectively. As of December 31, 2017, unrecognized restricted stock units compensation expense was approximately $60.1 million, with such unrecognized compensation expense expected to be recognized over a weighted average period of approximately 1.8 years.

The Company issues restricted stock units to employees under the equity incentive plan, primarily in connection with its annual bonus awards and compensation agreements for new hires. In certain jurisdictions, the Company may settle share-based payment awards in cash in lieu of shares of common stock to obtain tax deductibility. In these circumstances, the awards are settled in the cash equivalent value of the Company's shares of common stock based upon their value at settlement date. These cash settled share-based awards are remeasured at fair value at each reporting period.

The Company awarded 115,473 performance-based restricted stock awards ("PRSU"), as part of long-term incentive compensation in 2016. The PRSU award targeted performance from 2016 to 2018 to multi-year revenue, pre-tax profit and total stockholder return (“TSR”) goals, each equally weighted. If the achievement of a performance metric is below the threshold goal, the payout factor for such performance metric will be 0%. The maximum payout under the award is 288,683 units and the cumulative dividends over the reward period. The performance relative to revenue and pre-tax profit is measured quarterly and the probability weighted likelihood of achievement is recorded based on the grant day price. The TSR component is measured quarterly and the probability weighted likelihood of achievement is recorded based on the fair value at the date of grant.

Deferred Cash Compensation

As part of its long-term incentive award program, the Company grants deferred cash retention awards to certain eligible employees. The deferred awards, which generally vest over a three to five year service period or in full on the third or fifth anniversary of the grant date, provide the employee with the right to receive future cash compensation payments, which are non-interest bearing. Deferred cash compensation of $14.9 million and $7.0 million as of December 31, 2017 and 2016, respectively is included in compensation payable in the consolidated statements of financial condition. As of December 31, 2017, total unrecognized deferred cash compensation (prior to the consideration of forfeitures) was approximately $14.9 million and is expected to be recognized over a weighted-average period of 0.8 years.

For the years ended December 31, 2017, 2016 and 2015, the Company recognized compensation expense from the amortization of deferred compensation, net of forfeitures, of $13.1 million, $4.8 million and $2.6 million, respectively.