Company: CNDT
Filing Date: 2025-02-19
Form Type: 10-K
Source: 0001677703-25-000029
Chunk: 133

Company: CONDUENT Inc
Filing Date: 2025-02-19
Form: 10-K
Item: Item 8
Chunk 133
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 in cash at a redemption price per share equal to the liquidation preference and any accrued and unpaid dividends to, but not including, the redemption date. As a result of the contingent redemption feature, the Series A convertible preferred stock is classified as temporary equity and reflected separately from permanent equity in the Consolidated Balance Sheets.

Note 17 – Shareholders’ Equity

Preferred StockAs of December 31, 2024, the Company had one class of preferred stock outstanding. Refer to Note 16 – Common Stock and Preferred Stock for further information. The Company is authorized to issue approximately 100 million shares of convertible preferred stock at $0.01 par value per share.Common StockThe Company has 1 billion authorized shares of common stock at $0.01 par value per share. At December 31, 2024, 21.6 million shares were reserved for issuance under the Company's incentive compensation plans and 5.4 million shares were reserved for conversion of the Series A convertible preferred stock.Stock Compensation PlansCertain of the Company's employees participate in a long-term incentive plan. The Company's long-term incentive plan authorizes the issuance of restricted stock units / shares and performance stock units / share to employees. Stock-based compensation expense includes expense based on the awards and terms previously granted to the employees.Stock-based compensation expense was as follows:Year Ended December 31,(in millions)202420232022Stock-based compensation expense, pre-tax$19 $19 $21 Income tax benefit recognized in earnings4 4 4 Restricted Stock Units / Shares ("RSUs"): Compensation expense is based upon the grant date market price. The compensation expense is recorded over the vesting period based on management's estimate of the number of shares expected to vest. The Company’s RSU awards typically vest in three separate and equal tranches over a 2.75 years period. Each tranche vests annually, at December 31, following the date of grant.

CNDT 2024 Annual Report87

In 2024, the Company issued 408,000 Deferred Stock Units ("DSU") to non-employee members of the Board of Directors. DSU awards typically vest in accordance with certain service conditions. Performance Stock Units / Shares ("PSUs"): The Company has granted PSUs under various scenarios including:•PSUs that vest contingent upon its achievement of certain specified financial performance criteria that are averaged over a three-year period. If the three-year actual results exceed the stated targets,