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Stock-Based Awards

12 Months Ended

Dec. 31, 2024

Stock-Based Awards [Abstract]

Stock-Based Awards

18. Stock-Based Awards

On July 15, 2022, the Company’s stockholders approved the 2022 Equity Plan under which the Company may issue up to 16,000,000 shares of common stock (less one share for every share granted under the 2016 Equity Plan since March 31, 2022 and inclusive of shares available under the 2016 Equity Plan as of March 31, 2022) in the form of stock options and other stock-based awards.

The Company grants equity awards to employees and directors, which include restricted stock awards (“RSAs”), restricted stock units (“RSUs”), including deferred RSUs to non-employee directors, performance-based restricted stock units (“PRSUs”) and stock options. Certain awards described below are subject to acceleration under certain conditions.

Stock options:

Generally issued for terms of ten years and may vest after at least one year of service and have an exercise price equal to the Company’s stock price on the grant date. The Company estimates the fair value of stock options (when granted) using the Black-Scholes option pricing model.

RSAs/RSUs:

Awards are valued based on the Company’s stock price on grant date and generally vest ratably, on an annual basis, over three years. For non-employee directors, such awards generally vest on the one-year anniversary of the grant date.

Deferred RSUs:

Awards are valued based on the Company’s stock price on grant date and generally vest on the one-year anniversary of the grant date. The awards are issued pursuant to the Company’s Non-Employee Director Deferred Compensation Program and are settled based on timing elected by the recipient in advance.

PRSUs:

These awards cliff vest three years from the grant date and contain a market condition whereby the number of PRSUs ultimately vesting is tied to how the Company’s total shareholder return (“TSR”) compares to a peer group of other publicly traded asset managers over the three-year period. A Monte Carlo simulation is used to value these awards.

The number of PRSUs vesting ranges from 0% to 200% of the target number of PRSUs granted, as follows:

●

If the relative TSR is below the 25^th percentile, then 0% of the target number of PRSUs granted will vest;

●

If the relative TSR is at the 25th percentile, then 50% of the target number of PRSUs granted will vest;

●

If the relative TSR is above the 25th percentile, then linear scaling is applied such that the percent of the target number of PRSUs vesting is 100% at the 50th percentile and capped at 200% of the target number of PRSUs granted for performance at the 85th percentile; and

●

If the Company’s TSR is negative, the target number of PRSUs vesting is capped at 100% regardless of the relative TSR percentile.

During the years ended December 31, 2024, 2023 and 2022, total stock-based compensation expense was $20,691, $16,190 and $10,385, respectively, and the related tax benefit recognized on the Consolidated Statements of Operations was $5,032, $3,919 and $2,371, respectively.

The actual tax benefit realized for the tax deductions for share-based compensation was $2,884, $1,820 and $1,548 during the years ended December 31, 2024, 2023 and 2022, respectively.

A summary of unrecognized stock-based compensation expense and average remaining vesting period is as follows:

		December 31, 2024
		Unrecognized Stock- Based Compensation				Weighted-Average Remaining Vesting Period (Years)
Employees and directors		$	18,106				0.78

Stock Options

There was no option activity during the years ended December 31, 2024 and 2023 and there were no options outstanding as of December 31, 2024 and 2023.

RSAs, RSUs and PRSUs

The aggregate fair value of RSAs, RSUs and PRSUs that vested during the years ended December 31, 2024, 2023 and 2022 was $19,891, $10,158 and $9,466, respectively. A summary of activity is as follows:

		RSA								RSU								PRSU⁽¹⁾
		Shares				Weighted Average Grant Date Fair Value				Shares				Weighted Average Grant Date Fair Value				Shares				Weighted Average Grant Date Fair Value
Unvested Balance at January 1, 2022			3,036,905			$	5.20				54,990			$	4.93				550,686			$	5.73
Granted			2,170,432				5.71				116,247				5.18				319,838	⁽²⁾			6.80
Vested			(1,621,201	)			5.31				(27,894	)			5.10				(202,336	)			6.24
Forfeited			(195,054	)			5.43				(1,380	)			5.73				—				—
Unvested Balance at December 31, 2022			3,391,082			$	5.46				141,963			$	5.09				668,188			$	6.09
Granted			3,363,501				5.63				152,265				6.24				576,240	⁽²⁾			6.49
Vested			(1,629,925	)			5.28				(72,461	)			5.66				(108,113	)			3.11
Forfeited			(114,436	)			5.55				(34,385	)			5.70				—				—
Stock dividends accrued			—				—				2,762				6.24				37,777				6.49
Unvested Balance at December 31, 2023			5,010,222			$	5.63				190,144			$	5.70				1,174,092			$	6.58
Granted			2,135,016				7.18				117,112				8.08				474,056	⁽²⁾			8.62
Vested			(2,210,103	)			5.64				(37,422	)			5.58				(253,744	)			6.49
Forfeited			(108,091	)			6.10				(3,089	)			6.16				—				—
Stock dividends accrued			—				—				1,339				8.08				12,156				8.62
Unvested Balance at December 31, 2024			4,827,044			$	6.31				268,084	⁽³⁾		$	6.75				1,406,560			$	7.28

_____________________________

⁽¹⁾

Represents the target number of PRSUs granted and outstanding. The number of PRSUs that ultimately vest ranges from 0% to 200% of this amount. During the years ended December 31, 2024, 2023 and 2022, 200%, 77% and 0%, respectively, of the target number of PRSUs previously granted and vesting in such years ultimately vested, inclusive of shares attributable the reinvestment of dividend equivalents during the period between grant date and vesting date.

⁽²⁾

A Monte Carlo simulation was used to value these awards using the following assumptions for the Company and the peer group: (i) beginning 90-day average stock prices; (ii) valuation date stock prices; (iii) correlation coefficients based upon the price data used to calculate the historical volatilities; and (iv) the following additional assumptions:

		Granted in 2024				Granted in 2023				Granted in 2022
Historical stock price volatility (low)			28%				37%				33%
Historical stock price volatility (high)			38%				56%				57%
Historical stock price volatility (average)			34%				47%				44%
Risk free interest rate			4.08%				3.80%				1.28%
Expected dividend yield			0.00%				0.00%				0.00%

⁽³⁾

Includes 103,512 deferred RSUs that have vested.