Company: ALIT
Filing Date: 2025-02-27
Form Type: 10-K
Source: 0001809104-25-000062
Chunk: 222

Company: Alight, Inc. / Delaware
Filing Date: 2025-02-27
Form: 10-K
Item: Item 3
Chunk 222
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 common units in each type, were measured based on their estimated grant date fair value. The grant date fair value of the RSUs was equal to the value of the shares acquired by the Predecessor’s initial investors at the time of Alight Holding’s formation in 2017. The grant date fair values of the PRSUs were based on a Monte Carlo simulation methodology, which required management to make certain assumptions and apply judgement. Management determined the expected volatility based on the average implied asset volatilities of comparable companies as the Company did not have sufficient trading history for the PRSUs. The expected term represented the period that the PRSUs were expected to be outstanding. Because of the lack of sufficient historical data necessary to calculate the expected term, the Company used the contractual vesting period of five years to estimate the expected term. For the Predecessor period, the key assumptions included in the Monte 

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Carlo simulation were expected volatility of 45%, a risk-free interest rate of 1% and no expected dividends. The Company recognized share-based compensation expense on a straight-line basis over the requisite service period for the awards expected to ultimately vest. As a result of the change in control related to the Business Combination, the vesting of the time-based PRSU Class B units accelerated on the Closing Date. Prior to the Closing Date, the time-based PRSUs vested ratably over periods of one to five years. The remaining unvested PRSU Class B units had vesting conditions that were contingent upon the achievement of defined internal rates of return and multiples on invested capital occurrence and of certain liquidity events. The Class A-1 RSUs and PRSUs that were unvested as of the Closing Date had time-based and/or vesting conditions that were contingent upon the achievement of defined internal rates of return and multiples on invested capital occurrence and of certain liquidity events. Both the unvested Class A-1 and Class B units were replaced with unvested shares of Alight common stock as discussed below. Successor PlansIn connection with the Business Combination, the holders of certain unvested awards under the Predecessor plans were granted replacement awards in the Successor company. Class B units: The unvested Class B units of Alight Holdings will automatically convert on a one-for-one basis into shares of Class A Common Stock upon the achievement of certain market conditions, if achieved prior to the seventh anniversary of the Closing Date. Class A-1 units: The unvested Class A-1 units of Al