Equity-Based Compensation

12 Months Ended

Dec. 31, 2023

Share-Based Payment Arrangement [Abstract]

15. Equity-Based Compensation

In May 2012, Carlyle Group Management L.L.C., the general partner of the Partnership, adopted the Equity Incentive

Plan. The Equity Incentive Plan, which was amended on January 1, 2020 in connection with the Conversion to reflect shares of

the Company’s common stock, is a source of equity-based awards permitting the Company to grant to Carlyle employees,

directors and consultants non-qualified options, share appreciation rights, common shares, restricted stock units and other

awards based on the Company’s common shares. On June 1, 2021, the shareholders of the Company approved an amended and

restated Equity Incentive Plan that removed a provision providing for the automatic increase in the number of the Company’s

common stock available for grant and reset the total number of shares of common stock available for grant to 16,000,000 shares

of common stock for awards granted under the plan after June 1, 2021. On May 30, 2023, the shareholders of the Company

approved a further amended and restated Equity Incentive Plan which increased the total number of shares of common stock

available for the grant of awards under the Equity Incentive Plan after June 1, 2021 by an additional 23,800,000 shares of

common stock (from 16,000,000 shares of common stock to 39,800,000 shares of common stock). As of December 31, 2023,

the total number of shares of the Company’s common stock available for grant under the amended and restated Equity Incentive

Plan was 27,280,126.

Common Shares

In connection with its strategic investment in NGP, the Company agreed to grant common shares on an annual basis

with a value not to exceed based $10.0 million based on a prescribed formula, which will vest over a 42-month period. Because

the Company accounts for its investment in NGP under the equity method of accounting, the fair value of the shares is

recognized as a reduction to principal investment income. During the years ended December 31, 2023, 2022 and 2021, the

Company recognized $8.8 million, $8.4 million and $9.2 million, respectively, as a reduction to principal investment income

related to these shares.

Restricted Stock Units

The deferred restricted stock units are unvested when granted and vest ratably over a service period, which generally

ranges from one year to four years. The grant-date fair value of the deferred restricted stock units granted to Carlyle’s

employees is charged to equity-based compensation expense on a straight-line basis over the required service period.

Additionally, the calculation of the expense assumes a per unit discount that ranges from 2% to 20%, as these unvested awards

do not participate in any dividends. Equity-based compensation expense generates deferred tax assets, which are realized when

the units vest. The Company recorded compensation expense of $249.1 million, $154.0 million and $163.1 million for the years

ended December 31, 2023, 2022 and 2021, respectively, with $41.1 million, $28.7 million and $33.4 million of corresponding

deferred tax benefits, respectively. A portion of the accumulated deferred tax asset associated with equity-based compensation

expense was reclassified as a current tax benefit due to units vesting during the years ended December 31, 2023, 2022 and

2021. The net impact of the addition/(reduction) in deferred tax assets due to the equity-based compensation expense recorded

during the period less the tax deduction for units that vested was $12.7 million, $(3.2) million and $10.0 million for the years

ended December 31, 2023, 2022 and 2021, respectively. As of December 31, 2023, the total unrecognized equity-based

compensation expense related to unvested deferred restricted stock units is $466.9 million, which is expected to be recognized

over a weighted-average term of 2.3 years.

Equity-based awards issued to non-employees, including non-employee directors and consultants, are recognized as

general, administrative and other expenses. The grant-date fair value of deferred restricted stock units granted to non-employees

is charged to expense on a straight-line basis over the vesting period. Equity-based awards that require the satisfaction of future

service criteria are recognized over the relevant service period. The expense for equity-based awards issued to non-employees

was $6.5 million, $5.0 million and $5.2 million for the years ended December 31, 2023, 2022 and 2021, respectively.

During 2023, the Company granted 6.8 million shares related to equity inducement awards granted in connection with

the appointment of the Company’s Chief Executive Officer, including time-based restricted stock units which are eligible to

vest ratably in four equal installments, and performance based restricted stock units which contain stock price performance

conditions. Compensation cost for the awards containing market conditions, including stock price performance conditions, is

based on a grant-date fair value that factors in the probability that the market conditions will be achieved and is recognized over

the requisite service period on a straight-line basis.

During 2021, the Company granted 7.1 million long-term, strategic restricted stock units to certain senior

professionals, the majority of which are eligible to vest based on the achievement of annual performance targets over four years

across a number of the Company’s employees. Compensation cost is recognized over the requisite service period if it is

probable that the performance condition will be satisfied.

In February 2024, the Company granted 18.1 million restricted stock units. These awards included 13.2 million

restricted stock units granted to certain senior Carlyle professionals with an estimated grant date fair value of approximately

$347 million and which are subject to vesting based on the achievement of stock price performance conditions over a service

period of three years.

A summary of the status of the Company’s non-vested equity-based awards as of December 31, 2023 and a summary

of changes from December 31, 2020 through December 31, 2023, are presented below:


	The Carlyle Group, Inc.
	Equity Settled Awards
Unvested Shares	Restricted Stock Units	Weighted- Average Grant Date Fair Value	Unvested Common Shares(1)	Weighted- Average Grant Date Fair Value
Balance, December 31, 2020	8,523,082	$21.70	748,344	$25.39
Granted(2)	11,207,062	$31.64	291,396	$32.93
Vested	4,625,457	$22.64	404,310	$24.73
Forfeited	329,036	$31.02	—	$—
Balance, December 31, 2021	14,775,651	$30.70	635,430	$29.27
Granted	4,216,827	$40.35	188,223	$49.06
Vested	5,805,437	$28.15	370,773	$26.54
Forfeited	2,321,793	$30.84	—	$—
Balance, December 31, 2022	10,865,248	$35.78	452,880	$39.73
Granted(3)	18,273,547	$29.88	258,579	$39.73
Vested	5,280,029	$31.86	252,530	$34.85
Forfeited	1,685,119	$32.24	—	$37.91
Balance, December 31, 2023	22,173,647	$32.12	458,929	$37.87

(1)Includes common shares issued in connection with the Company’s investment in NGP.

(2)Includes 7.1 million long-term, strategic restricted stock units to certain senior professionals, the majority of which are eligible to vest based on the

achievement of annual performance targets over four years across a number of the Company’s employees.

(3)Includes 6.8 million shares related to equity inducement awards granted in connection with the appointment of the Company’s Chief Executive Officer,

as well as 0.3 million shares reserved for issuance upon the settlement of dividend-equivalent rights carried by certain restricted stock units

concurrently with the settlement of the restricted stock units for shares.