Upon the consummation of the merger, Evergy assumed both Evergy Kansas Central's Long-Term Incentive and Share Award plan (LTISA) and Great Plains Energy's Amended Long-Term Incentive Plan, which was renamed the Evergy, Inc. Long-Term Incentive Plan. All outstanding share-based payment awards under Evergy Kansas Central's LTISA vested at the closing of the merger transaction and were converted into a right to receive Evergy common stock with the exception of certain RSUs and deferred director share units issued prior to the closing of the merger to certain directors, officers and employees of Evergy Kansas Central. The vesting of these shares resulted

All of Great Plains Energy's outstanding performance shares, restricted stock, RSUs and director deferred share units under Great Plains Energy's Amended Long-Term Incentive Plan were converted into equivalent Evergy performance shares, restricted stock, RSUs and director deferred share units at Great Plains Energy's merger exchange ratio of 0.5981. The estimated fair value of these converted awards that was allocated to the purchase price was $12.5 million, after-tax. See Note 2 for more information regarding the merger.



	2019		2018		2017
Evergy	(millions)
Equity compensation expense	$	15.5	$	30.7	$	8.9
Income tax benefit	3.0		1.4		3.5
Evergy Kansas Central
Equity compensation expense	6.7		24.8		8.9
Income tax benefit	1.9		1.4		3.5
Evergy Metro^(a)
Equity compensation expense	5.7		6.5		4.2
Income tax benefit	0.3		0.1		1.6

Evergy has utilized RSUs for new grants of stock-based compensation awards subsequent to the merger. RSU awards are grants that entitle the holder to receive shares of common stock as the awards vest. These RSU awards are defined as nonvested shares and do not include restrictions once the awards have vested. These RSUs either take the form of RSUs with performance measures that vest upon expiration of the award term or RSUs with only service requirements that vest solely upon the passage of time.

The payment of RSUs with performance measures is contingent upon achievement of specific performance goals over a stated period of time as approved by the Compensation and Leadership Development Committee of the Board. The numbers of RSUs with performances measures ultimately paid can vary from the numbers of RSUs with performance measures initially granted depending on Evergy's performance over stated performance periods. Compensation expense for RSUs with performance measures is calculated by recognizing the portion of the fair value for each reporting period for which the requisite service has been rendered. Dividends are accrued over the vesting period and paid in cash based on the number of RSUs with performance measures ultimately paid.

The fair value of RSUs with performance measures is estimated using the market value of Evergy's stock at the valuation date and a Monte Carlo simulation technique that incorporates assumptions for inputs of expected volatilities, dividend yield and risk-free rates. Expected volatility is based on daily stock price change during a historical period commensurate with the remaining term of the performance period of the grant. The risk-free rate is based upon the rate at the time of the evaluation for zero-coupon government bonds with a maturity consistent with the remaining performance period of the grant. The dividend yield is based on the most recent dividends paid and the actual closing stock price on the valuation date. For shares granted in 2019, inputs for expected volatility, dividend yield and risk-free rates were 18%, 3.45% and 2.6%, respectively.



	Nonvested Restricted Share Units			Grant Date Fair Value*
Beginning balance January 1, 2019		—			$	—
Granted		202,107			37.87
Forfeited		(4,857	)		37.87
Ending balance December 31, 2019		197,250			37.87

At December 31, 2019, the remaining weighted-average contractual term related to RSU awards with performance measures was 2.2 years. The weighted-average grant-date fair value of RSUs granted with performance measures was $37.87 in 2019. At December 31, 2019, there was $5.4 million of unrecognized compensation expense related to unvested RSUs with performance measures. No RSUs with performance measures vested in 2019.

Evergy measures the fair value of RSUs with only service requirements based on the fair market value of the underlying common stock as of the grant date. RSU awards with only service conditions recognize compensation expense by multiplying shares by the grant-date fair value related to the RSU and recognizing it on a straight-line basis over the requisite service period for the entire award, including for those RSUs that have a graded vesting schedule. Nonforfeitable dividend equivalents, or the rights to receive cash equal to the value of dividends paid on Evergy's common stock, are paid on certain of these RSUs during the vesting period. Nonforfeitable dividend equivalents are recorded directly to retained earnings.



	Nonvested Restricted Share Units			Grant Date Fair Value*
Beginning balance January 1, 2019		217,256			$	54.07
Granted		70,395			54.47
Vested		(48,767	)		54.20
Forfeited		(5,534	)		54.23
Ending balance December 31, 2019		233,350			54.16

At December 31, 2019, the remaining weighted-average contractual term related to RSU awards with only service requirements was 1.1 years. The weighted-average grant-date fair value of RSUs granted with only service requirements was $54.47, $52.16 and $53.25 in 2019, 2018 and 2017, respectively. At December 31, 2019, there was $5.2 million of unrecognized compensation expense related to unvested RSUs. The total fair value of RSUs with only service requirements that vested was $2.6 million, $16.0 million and $6.1 million in 2019, 2018 and 2017, respectively.

Evergy's performance shares represent legacy Great Plains Energy performance shares that converted into equivalent Evergy performance shares at the closing of the merger transaction. The vesting of performance shares is contingent upon achievement of specific performance goals over a stated period of time as approved by the Compensation and Leadership Development Committee of the Evergy Board. The number of performance shares ultimately vested can vary from the number of shares initially granted depending on Evergy's performance over stated performance periods. Compensation expense for performance shares is calculated by recognizing the portion of the grant date fair value for each reporting period for which the requisite service has been rendered. Dividends are accrued over the vesting period and paid in cash based on the number of performance shares ultimately paid.

The fair value of performance share awards was estimated using the market value of Evergy Kansas Central's and Great Plains Energy's common stock at the valuation date upon conversion at the merger and a Monte Carlo simulation technique that incorporates assumptions for inputs of expected volatilities, dividend yield and risk-free rates. Expected volatility was based on daily stock price change based on historical common stock information during a historical period commensurate with the remaining term of the performance period of the grant. The risk-free rate was based upon the rate at the time of the evaluation for zero-coupon government bonds with a maturity consistent with the remaining performance period of the grant. The dividend yield was based on the most recent dividends paid by Evergy Kansas Central, as Evergy's stock price assumed Evergy Kansas Central's stock price on a forward basis, and the grant date stock price on the valuation date.

Performance share activity for 2019 is summarized in the following table. Performance adjustment represents the difference between the number of shares of common stock related to performance shares ultimately issued from the number of performance shares initially granted which can vary depending on Evergy's performance over a stated period of time.



	Performance Shares			Grant Date Fair Value*
Beginning balance January 1, 2019		348,496			$	63.80
Vested		(69,317	)		46.11
Forfeited		(6,481	)		69.65
Performance adjustment		(44,442	)		42.97
Ending balance December 31, 2019		228,256			73.06

At December 31, 2019, the remaining weighted-average contractual term was 0.5 years. There were no shares granted in 2019. The weighted-average grant-date fair value of shares granted was $63.79 in 2018. At December 31, 2019, there was $2.2 million of total unrecognized compensation expense, net of forfeiture rates, related to performance shares granted under the Evergy, Inc. Long-Term Incentive Plan, which will be recognized over the remaining weighted-average contractual term. The total fair value of performance shares vested was $3.2 million in 2019. There were no vested performance shares in 2018.

Evergy's restricted stock represents legacy Great Plains Energy restricted stock that converted into equivalent Evergy restricted stock at the closing of the merger transaction. Restricted stock cannot be sold or otherwise transferred by the recipient prior to vesting and has a value equal to the fair market value of the shares on the issue date. Restricted stock shares vest over a stated period of time with accruing reinvested dividends subject to the same restrictions. Compensation expense, calculated by multiplying shares by the grant-date fair value related to restricted stock, is recognized on a straight-line basis over the requisite service period of the award.



	Nonvested Restricted Stock			Grant Date Fair Value*
Beginning balance January 1, 2019		116,675			$	54.03
Vested		(38,404	)		54.35
Forfeited		(2,161	)		53.88
Ending balance December 31, 2019		76,110			53.87

At December 31, 2019, the remaining weighted-average contractual term was 0.7 years. There were no shares granted in 2019. The weighted-average grant-date fair value of shares granted was $54.05 in 2018. At December 31, 2019, there was $0.8 million of total unrecognized compensation expense, net of forfeiture rates, related to nonvested restricted stock granted under the Evergy, Inc. Long-Term Incentive Plan, which will be