Equity-based compensation expense is allocated to all departments in the accompanying consolidated statements of operations based on the recipients of the compensation. A summary of the expense by line item in the consolidated statements of operations for the years ended December 31, 2022, 2021 and 2020, is provided in the following table.


	Year Ended December 31,
(in thousands)	2022		2021		2020
Cost of revenue	$	942	$	277	$	62
Sales and marketing		13,508		1,930		473
Product development		7,805		1,070		356
General and administrative		14,179		6,680		856
Total compensation expense	$	36,434	$	9,957	$	1,747

The Definitive Healthcare Corp. 2021 Equity Incentive Plan (the “2021 Plan”) was adopted in September 2021. The types of grants available under the 2021 Plan include stock options (both incentive and non-qualified), stock appreciation rights (“SARs”), restricted stock awards (“RSAs”), restricted stock units (“RSUs”), and stock-based awards.

The aggregate number of shares of Class A Common Stock available for grant under the 2021 Plan was 4,942,128 shares at December 31, 2022. The outstanding RSUs have time-based and/or performance-based vesting criteria.

Outstanding time-based RSUs generally vest partially on the one-year anniversary of each grant and quarterly over the subsequent two- or three-year period.

In connection with the departure of two management-level employees, the Company accelerated the vesting of 6,772 previously unvested time-based RSUs, resulting in incremental stock-based compensation expense of approximately $0.1 million during the fourth quarter of 2022. Upon separation, 21,877 unvested time-based RSUs and 13,889 unvested PSUs were forfeited. None of the previously unvested PSUs were accelerated and, accordingly, no incremental stock-based compensation expense was recognized.

The following table summarizes the Company's unvested time-based activity for the years ended December 31, 2022 and 2021:


	2022					2021
				Weighted					Weighted
	Restricted			Average Grant		Restricted			Average Grant
	Stock Units			Date Fair Value		Stock Units			Date Fair Value
Unvested at beginning of year		1,935,899		$	32.59		—		$	—
Granted		2,457,991		$	20.27		1,965,477		$	32.50
Vested		(716,776	)	$	29.86		—		$	—
Forfeited		(238,727	)	$	25.51		(29,578	)	$	27.00
Unvested at end of year		3,438,387		$	24.82		1,935,899		$	32.59

The Company recognized $27.0 million in stock-based compensation expense associated with time-based RSUs in the year ended December 31, 2022, inclusive of the incremental expense associated with the departing management-level employees, and $4.4 million in the year ended December 31, 2021. Total unrecognized expense for these awards was estimated to be $75.8 million at December 31, 2022, to be recognized over a weighted-average period of approximately 2.7 years.

The Company periodically grants PSUs to certain members of the Company’s senior management team subject to the satisfaction of annual and cumulative performance conditions and/or market conditions established by the Human Capital Management and Compensation Committee of the Board of Directors of Definitive Healthcare Corp. All PSUs previously granted without market-based vesting conditions were forfeited as of December 31, 2022 as none of the performance targets required for vesting were achieved and all expense that was previously recognized associated with these awards was reversed.

In May 2022, the Company granted PSUs to a member of the executive leadership team with performance criteria related to the relative ranking of the total stockholder return (“TSR”) of the Company’s common stock for the cumulative three-year performance period return relative to the TSR of certain peer companies within the Nasdaq Software & Services Index. TSR will be measured based on the 20-trading-day average closing stock price on the first day of the performance period compared

to the 20-trading-day average closing stock price on the last day of such period, inclusive of applicable cash dividend payments. These PSUs subject to the performance criteria will cliff vest after three years, subject to the satisfaction of the performance criteria and the executive’s continued employment through the performance period. PSUs may vest in a range between 0% and 300%, based on the satisfaction of performance, and no shares will be issued if the minimum applicable performance metric is not achieved. As these PSUs vest based on the achievement of market conditions, the grant date fair values were determined using a Monte-Carlo valuation model. The Monte-Carlo valuation model considered a variety of potential future share prices for the Company as well as its peer companies in the selected market index. Expense for these awards is recognized ratably over the requisite service period based on the fair value of the award.

The following table summarizes the Company's unvested PSU activity for the years ended December 31, 2022 and 2021:


	2022					2021
				Weighted				Weighted
	Restricted			Average Grant		Restricted		Average Grant
	Stock Units			Date Fair Value		Stock Units		Date Fair Value
Unvested at beginning of year		164,351		$	27.00		—	$	—
Granted		125,000		$	54.25		164,351	$	27.00
Vested		—		$	-		—	$	—
Forfeited		(164,351	)	$	27.00		—	$	—
Unvested at end of year		125,000		$	54.25		164,351	$	27.00

The number of PSUs awarded represents the target number of shares of common stock that may be earned; however, the actual number of shares may vary based on the satisfaction of performance criteria. The Company recognized $1.7 million in stock-based compensation expense associated with PSUs in the year ended December 31, 2022, and did not recognize any expense associated with PSUs in the year ended December 31, 2021. Total unrecognized expense for these awards was estimated to be $5.1 million at December 31, 2022, to be recognized over a weighted-average period of approximately 2.0 years.

The AIDH Topco, LLC 2019 Equity Incentive Plan (the “2019 Plan”) was utilized prior to the Reorganization Transactions and the IPO for the issuance of equity awards in the form of Class B Units to or on behalf of employees, consultants, directors, managers, or others providing services to the Company. In connection with the Reorganization Transactions and the IPO, unvested Class B Units held directly by employees of the Company or indirectly through AIDH Management Holdings, LLC, were exchanged for unvested Definitive OpCo units (held directly or indirectly through AIDH Management Holdings, LLC) based on their respective participation thresholds and the IPO price of $27.00 per share. The Company no longer grants any awards under the 2019 Plan, though previously granted awards under the 2019 Plan remain outstanding and governed by the 2019 Plan, including unvested units.

In connection with the departure of two management-level employees, the Company accelerated the vesting of 126,350 previously unvested Definitive OpCo units (held indirectly through AIDH Management Holdings, LLC), resulting in incremental stock-based compensation expense of approximately $1.8 million during the fourth quarter of 2022. Upon separation, 81,857 unvested Definitive OpCo units (held indirectly through AIDH Management Holdings, LLC) were forfeited.

The following table summarizes the Company’s unvested unit activity.


	Time-Based
				Weighted
	Non-Vested			Average Grant
	Units			Date Fair Value
Unvested at December 31, 2021		2,756,406		$	2.02
Vested		(1,060,385	)		2.03
Forfeited		(186,872	)		2.03
Unvested at December 31, 2022		1,509,149		$	2.03

The Company recorded $7.7 million in stock-based compensation expense associated with these units in the year ended December 31, 2022, inclusive of the incremental expense associated with the departing management-level employees, and $3.4 million during the year ended December 31, 2021. The Company also recorded $1.9 million in incremental compensation expense in the third quarter of 2021 associated with the acceleration of an equity-based award upon retirement of an executive officer. At December 31, 2022, the Company had approximately $8.2 million of unrecognized unit-based compensation expense for unvested units, which is expected to be recognized over a weighted-average period of approximately 1.7 years.