The Company has an active equity incentive plan, the Alight, Inc. 2021 Omnibus Incentive Plan (the "Incentive Plan"), under which the Company has been authorized to grant share-based awards to key employees and non-employee directors, which consist of restricted stock units ("RSUs") and performance share units ("PRSUs"). Under this plan, for grants issued during the three months ended March 31, 2024, approximately 42% of the units are subject to time-based vesting requirements and approximately 58% are subject to performance-based vesting requirements. As of March 31, 2024, there were 79,157,976 remaining shares of common stock authorized for issuance pursuant to the Company’s stock-based compensation plans under its 2021 Omnibus Incentive Plan.

RSUs are valued at the market price of a share of the Company’s common stock on the date of grant. In general, these awards vest ratably over a three-year period from the date of grant. All awards are expensed on a straight-line basis over a three-year period, which is considered to be the requisite service period.

The Company’s PRSUs contain various performance and service conditions that must be satisfied for an employee to earn the right to benefit from the award. The PRSUs vest upon achievement of various performance metrics aligned to goals established by the Company. Expense is recognized on a straight-line basis over the requisite service period, based on the probability of achieving the performance conditions, with changes in expectations recognized as an adjustment to earnings in the period of the change. Compensation cost is not recognized for performance share units that do not vest because service or performance conditions are not satisfied, and any previously recognized compensation cost is reversed.

The weighted-average grant-date fair value per share of RSUs and PRSUs granted during the three months ended March 31, 2024 was approximately $8.99 and $8.83, respectively.

The following tables summarizes the RSU and PRSU activity during the three months ended March 31, 2024:


					Weighted						Weighted
					Average						Average
					Grant Date						Grant Date
					Fair Value						Fair Value
	RSUs				Per Unit		PRSUs(1)				Per Unit
Balance as of December 31, 2023		8,174,812		$		9.78		28,041,674		$		11.25
Granted		4,603,556				8.99		6,310,482				8.83
Vested		(2,569,109	)			9.00		(19,755,498	)			12.28
Forfeited		(50,718	)			8.62		(175,350	)			8.73
Balance as of March 31, 2024		10,158,541		$		8.87		14,421,308		$		8.86

(1)

The number of PRSUs presented are based on actual or expected achievement of the respective performance goals as of the end of the period.

The Company expects to forfeit approximately 3.5 million shares upon closing of the Company’s planned sale of its Payroll and Professional Services business as discussed in Note 1 Basis of Presentation and Nature of Business.

Total share-based compensation expense related to the RSUs and PRSUs are recorded in the Condensed Consolidated Statements of Comprehensive Income (Loss) as follows (in millions):


	Three Months Ended		Three Months Ended
	March 31,		March 31,
	2024		2023
Cost of services, exclusive of depreciation and amortization	$	5	$	7
Selling, general and administrative		23		27
Total share-based compensation expense	$	28	$	34

As of March 31, 2024, total future compensation expense related to unvested RSUs was $83 million, which will be recognized over a remaining weighted-average amortization period of approximately 2.3 years. As of March 31, 2024, total future compensation expense related to PRSUs was $77 million, which will be recognized over a remaining weighted-average amortization period of approximately 2.0 years.

In December 2022, the Company began offering its employees an Employee Stock Purchase Plan (the “ESPP”). Under the ESPP, all full-time and certain part-time employees of the Company based in the U.S. and certain other countries are eligible to purchase Class A Common Stock of the Company twice per year at the end of a six-month payment period (a “Payment Period”). During each Payment Period, eligible employees who so elect may authorize payroll deductions in an amount no less than 1% nor greater than 10% of his or her base pay for each payroll period in the Payment Period. At the end of each Payment Period, the accumulated deductions are used to purchase shares of Class A Common Stock from the Company up to a maximum of 1,250 shares for any one employee during a Payment Period. Shares are purchased at a price equal to 85% of the fair market value of the Company’s Class A Common Stock on the last business day of a Payment Period. As of March 31, 2024, there were 11,961,530 remaining shares available for grant under the ESPP.

As of March 31, 2024, 1,499,751 shares have been issued under the ESPP and the amount of share-based compensation expense related to the ESPP was $2 million for the three months ended March 31, 2024.