The Company maintains compensation arrangements with certain of its Affiliates whereby in exchange for continued service, Affiliate equity is either purchased by, or granted to Affiliate key employees subject to a limit imposed by the Company, and may be repurchased either by Affiliate key employees or by the Company at a future date at the then applicable fair value, subject to service requirements having been met. Pre-acquisition equity units held by employees of acquired Affiliates that are subject to service conditions are also accounted for as equity-based compensation arrangements. Compensation expense is recognized over the requisite service period equal to the cumulative vested fair value of the award at the end of each period up to vesting date.

The Company accounts for these arrangements as “cash-settled” share-based payments, and accordingly a corresponding share-based payment liability is recorded. The fair value of the liabilities are determined with the assistance of third party valuation specialists using discounted cash flow analyses, which incorporate assumptions for the forecasted earnings information, market risk adjustments, discount rates and post-vesting restrictions. Vested Affiliate equity liabilities are revalued at each period end until settlement date, with changes in the liabilities included within compensation expense.

In conjunction with the Landmark acquisition, BSIG entered into compensation arrangements with employees of Landmark where an additional acquisition-related payment of $207.6 million was earned based on the growth of Landmark’s business. This arrangement was accounted for as cash-settled equity-based compensation and fair valued as of the closing date of the acquisition. The amount vested on December 31, 2018 and was paid in February 2019.



	2019			2018			2017
Balance, beginning of period	$	386.1		$	188.8		$	53.7
Amortization and revaluation of granted awards	45.1			199.9			135.8
Repurchases (cash-settled)	(209.4		)	(2.6		)	(0.7		)
Balance, end of period	$	221.8		$	386.1		$	188.8

The Company has established various plans under which it is authorized to grant restricted stock awards (“RSAs”), restricted stock units (“RSUs”), performance-based restricted stock awards (“Performance-based RSAs”), performance-based restricted stock units (“Performance-based RSUs”) and stock option awards. These plans are maintained to provide equity-based compensation arrangements to employees and non-executive directors. Equity ownership encourages employees and directors to act in the best long-term interests of the Company. A total of 21.0 million shares of common stock have been reserved for issuance under the various plans.

Compensation expense recognized by the Company for the years ended December 31, 2019, 2018, and 2017 in relation to these awards was $5.8 million, $7.1 million, and $14.6 million respectively. The related income tax benefit recognized for years ended December 31, 2019, 2018 and 2017 was $0.5 million, $1.3 million and $5.7 million respectively. Unamortized compensation expense related to unvested RSAs, RSUs, Performance-based RSAs, Performance-based RSUs and stock options at December 31, 2019 of $11.3 million is expected to be recognized over a weighted-average period of 2.0 years. The service inception date for annual awards granted in 2019 is deemed to be January 1, 2018. It is anticipated that annual awards for 2019 with a fair value of $0.7 million will be granted during 2020 with a service inception date of January 1, 2019.



	2019			2018			2017
BrightSphere Investment Group Inc. awards	Shares granted	Weighted average fair value		Shares granted	Weighted average fair value		Shares granted	Weighted average fair value
RSAs	18,000	$	10.09	304,389	$	15.84	342,637	$	15.13
RSUs	88,980	12.4		48,930	14.98		51,779	14.45
Performance-based RSAs	—	—		83,092	9.78		175,586	10.26
Performance-based RSUs	9,013	14.62		—	—		—	—
Stock options	2,070,000	2.48		6,900,000	1.69		—	—

The following table summarizes the activity related to restricted stock awards:



	2019				2018				2017
BrightSphere Investment Group Inc. RSAs	Number of shares		Weighted average grant date fair value per share		Number of shares		Weighted average grant date fair value per share		Number of shares		Weighted average grant date fair value per share
Outstanding at beginning of the year	325,976		$	14.83	422,927		$	14.26	1,375,201		$	13.77
Granted during the year	18,000		10.09		304,389		15.84		342,637		15.13
Forfeited during the year	(47,453	)	15.43		(14,136	)	14.97		(802	)	17.65
Exercised during the year	(219,306	)	14.45		(387,204	)	15.00		(1,294,109	)	13.97
Other transfers	—		—		—		—		—		—
Outstanding at end of the year	77,217		$	14.43	325,976		$	14.83	422,927		$	14.26

The grant date fair value per share, calculated based on the closing price as quoted on the New York Stock Exchange on the measurement date, is used to determine the fair value of restricted stock awards granted to employees. Restricted stock awards under the plan generally have a vesting period of one to three years.



	2019				2018				2017
BrightSphere Investment Group Inc. RSUs	Number of shares		Weighted average grant date fair value per share		Number of shares		Weighted average grant date fair value per share		Number of shares		Weighted average grant date fair value per share
Outstanding at beginning of the year	47,191		$	14.46	76,223		$	14.70	85,923		$	13.59
Granted during the year	88,980		12.40		48,930		14.98		51,779		14.45
Forfeited during the year	(24,591	)	14.46		—		—		—		—
Exercised during the year	(48,681	)	14.14		(77,962	)	15.02		(61,479	)	12.93
Outstanding at end of the year	62,899		$	11.79	47,191		$	14.46	76,223		$	14.70

The grant date fair value per share, calculated based on the closing price as quoted on the New York Stock Exchange on the measurement date, is used to determine the fair value of restricted stock units granted to employees. Restricted stock units under the plan generally have a vesting period of one to three years.



	2019			2018			2017
BrightSphere Investment Group Inc. Performance-based RSAs	Number of shares	Weighted average grant date fair value per share		Number of shares	Weighted average grant date fair value per share		Number of shares	Weighted average grant date fair value per share
Outstanding at beginning of the year	258,678	$	10.11	175,586	$	10.26	—	$	—
Granted during the year	—	—		83,092	9.78		175,586	10.26
Forfeited during the year	—	—		—	—		—	—
Exercised during the year	—	—		—	—		—	—
Outstanding at end of the year	258,678	$	10.11	258,678	$	10.11	175,586	$	10.26

The following table summarizes the activity related to performance-based restricted stock units:



	2019				2018				2017
BrightSphere Investment Group Inc. Performance-based RSUs	Number of shares		Weighted average grant date fair value per share		Number of shares		Weighted average grant date fair value per share		Number of shares	Weighted average grant date fair value per share
Outstanding at beginning of the year	189,335		$	10.92	640,992		$	20.59	640,992	$	20.59
Granted during the year	9,013		14.62		—		—		—	—
Forfeited during the year	—		—		—		—		—	—
Exercised during the year	(193,125	)	10.98		(532,956	)	23.21
Other movements	3,790		14.15		81,299		15.21
Outstanding at end of the year	9,013		$	14.62	189,335		$	10.92	640,992	$	20.59

The Performance-based RSUs granted by the Company have a market vesting condition; therefore a Monte-Carlo simulation model was used to determine the fair value of the restricted units granted to employees. Significant assumptions utilized in the Monte-Carlo simulation model include assumed reinvestment of dividends, a risk-free interest rate of 2.48%, and an expected volatility of 26.11%, which is based on an average volatility of the Company’s peer group. Performance-based RSUs under the plan have a vesting period of three years.



	2019						2018
	Stock Options	Weighted average exercise price		Weighted average remaining contractual term (in years)	Aggregate intrinsic value		Stock Options	Weighted average exercise price		Weighted average remaining contractual term (in years)	Aggregate intrinsic value
Outstanding at beginning of the year	6,900,000	$	12.00	5			—	—
Granted during the year	2,070,000	$	12.00	5			6,900,000	$	12.00	5
Forfeited during the year	—	—					—	—
Exercised during the year	—	—					—	—
Outstanding at end of the year	8,970,000	12.00		4	$	—	6,900,000	12.00		5	$	—
Exercisable at end of the year	3,174,000	$	12.00	4	$	—	1,380,000	$	12.00	5	$	—

The Company granted stock options with a fair value of $5.1 million and $11.7 million during the years ended December 31, 2019 and 2018, respectively. The total fair value of options vested during the years ended December 31, 2019 and 2018 was $4.3 million and $2.3 million, respectively.

The fair value of the stock options grant was estimated on the grant date using a Monte-Carlo simulation valuation model. The weighted average fair value of stock options granted during the years ended December 31, 2019 and 2018 was $2.48 and $1.69 per option, respectively, based on the grant date assumptions stated below.



	2019			2018
Weighted-average grant date fair value per option	$	2.48		$	1.69
Assumptions:
Dividend yield ⁽¹⁾	3.4		%	3.8		%
Expected volatility ⁽²⁾	28.4		%	28.3		%
Risk-free interest rate ⁽³⁾	2.6		%	2.5		%
Expected life of options ⁽⁴⁾	5 years			5 years

OM plc maintained various equity-based compensation arrangements, including stock options and restricted stock awards, in which the Company’s employees participated in the periods presented. The cost of these equity-based programs is not material, and has been included in the Company’s financial results where applicable.



	2019					2018					2017
	Number of shares	Weighted average grant date fair value per share GBP		Weighted average grant date fair value per share USD		Number of shares	Weighted average grant date fair value per share GBP		Weighted average grant date fair value per share USD		Number of shares		Weighted average grant date fair value per share GBP		Weighted average grant date fair value per share USD
Outstanding at the beginning of the year	—	£	—	$	—	—	£	—	$	—	155,132		£	2.03	$	2.53
Granted during the year	—	—		—		—	—		—		—		—		—
Forfeited during the year	—	—		—		—	—		—		—		—		—
Exercised during the year	—	—		—		—	—		—		(155,132	)	2.03		2.72
Other transfers	—	n/a		n/a		—	n/a		n/a		—		n/a		n/a
Outstanding at the end of the year	—	£	—	$	—	—	£	—	$	—	—		£	—	$	—