13.

EMPLOYEE STOCK OPTION AND RETIREMENT PLANS

Stock Option Awards

The FactSet Research Systems Inc. Stock Option and Award Plan, as Amended and Restated (the "Long Term Incentive Plan" or "LTIP") provides for the grant of share-based awards, including stock options and restricted stock awards to employees of FactSet. The expiration date of the Long Term Incentive Plan is

December 19, 2027.

Stock options granted under the LTIP expire

not

more than

ten

years from the date of grant and the majority vest ratably over a period of

five

years. Options become vested and exercisable provided the employee continues employment with the Company through the applicable vesting date and remain exercisable until expiration or cancellation. Options are

not

transferable or assignable other than by will or the laws of descent and distribution. During the grantee’s lifetime, the options

may

be exercised only by the grantee.

Stock Option Activity

During the

first

nine

months of fiscal

2019,

FactSet granted

463,033

stock options with a weighted average exercise price of

$221.97

to existing employees of the Company. A summary of stock option activity for the

nine

months ended

May

31,

2019

is as follows:

(in thousands, except per share data)	Number of Stock Options Outstanding			Weighted Average Exercise Price Per Share
Balance at August 31, 2018		3,143		$	153.05
Granted – non-performance-based employee grant		455			221.93
Exercised		(117	)		132.81
Forfeited		(24	)		169.47
Balance at November 30, 2018		3,457		$	162.68
Granted – non-performance-based employee grant		6			207.84
Granted – non-employee Directors’ grant		21			207.88
Exercised		(207	)		136.30
Forfeited		(61	)		152.19
Balance at February 28, 2019		3,216		$	164.42
Granted – non-performance-based employee grant		2			267.02
Exercised		(279	)		137.82
Forfeited		(73	)		168.42
Balance at May 31, 2019		2,866		$	167.00

The total number of in-the-money options exercisable as of

May

31,

2019

was

0.9

million with a weighted average exercise price of

$138.85.

The aggregate intrinsic value of in-the-money stock options exercisable at

May

31,

2019

and

August

31,

2018

was

$131.2

million and

$105.3

million, respectively. The aggregate intrinsic value represents the difference between the Company’s closing stock price as of

May

31,

2019

$278.20

and the exercise price, multiplied by the number of options exercisable as of that date.

The total pre-tax intrinsic value of stock options exercised during the

three

months ended

May

31,

2019

and

2018

was

$32.1

million and

$5.2

million, respectively. The total pre-tax intrinsic value of stock options exercised during the

nine

months ended

May

31,

2019

and

2018

was

$58.4

million and

$40.3

million, respectively.

Performance-based

Equity Awards

Performance-based equity awards, whether in the form of stock options or restricted stock, require management to make assumptions regarding the likelihood of achieving Company performance targets. The number of performance-based awards that vest will be predicated on the Company achieving performance levels during the measurement period subsequent to the date of grant. Dependent on the financial performance levels attained by FactSet, a percentage of the performance-based awards will vest to the grantees. However, there is

current guarantee that such awards will vest in whole or in part.

June 2017

Performance-based Option Grant Review

In connection with the acquisition of BISAM, FactSet granted

206,417

performance-based stock options in

June 2017.

These performance-based options were scheduled to vest

40%

on the

second

anniversary date of the grant and

20%

on each subsequent anniversary date, if certain BISAM revenue and operating income targets were achieved by

March 31, 2019.

In the

third

quarter of fiscal

2019,

it was determined that the performance criteria were

not

achieved by

March 31, 2019,

and, as such, the options were forfeited and

stock-based compensation expense was recorded for this performance-based option grant for the

three

and

nine

months ended

May 31, 2019.

Restricted Stock Awards

The Company’s Option Plan permits the issuance of restricted stock awards in the form of either restricted shares or restricted stock units. Restricted stock awards are subject to continued employment over a specified period.

Restricted Stock Awards Activity

During the

first

nine

months of fiscal

2019,

FactSet granted

41,418

restricted stock awards to employees of the Company at a weighted average grant date fair value of

$212.94.

These restricted stock awards vest over a weighted average period of

5.0

years from grant date. As of

May

31,

2019,

a total of

104,136

restricted stock awards were unvested and outstanding. This resulted in an unamortized stock-based compensation balance of

$14.9

million, which will be recognized as stock-based compensation expense over the remaining weighted average vesting period of

3.4

years.

A summary of restricted stock award activity is as follows:

(in thousands, except per award data)	Number Outstanding			Weighted Average Grant Date Fair Value Per Award
Balance at August 31, 2018		143		$	139.34
Granted		41		$	212.66
Forfeited		(1	)	$	200.18
Vested		(52	) (1)	$	113.44
Balance at November 30, 2018		131		$	172.48
Granted		—		$	—
Forfeited		(1	)	$	184.64
Vested		(23	) (2)	$	136.58
Balance at February 28, 2019		107		$	187.62
Granted		—		$	—
Forfeited		(3	)	$	177.29
Vested		—		$	—
Balance at May 31, 2019		104		$	180.09

(

)

The

majority of the vested

restricted stock

awards

the final vesting of

awards

granted

November 1, 2013,

which cliff vested

60%

after

three

years on

November 1, 2016

and

40%

after

five

years on

November 1, 2018.

(

)

The majority of the vested restricted stock awards related to the final vesting of awards granted on

February 9, 2015,

which vested

100%

on the

four

year anniversary date of the grant.

As of

May

31,

2019,

and

August

31,

2018,

the aggregate fair value of unvested restricted stock was

$29.0

million and

$32.8

million, respectively. Aggregate fair value of unvested restricted stock represents the Company’s closing stock prices on

May

31,

2019

and

August

31,

2018

$278.20

and

$229.39,

respectively, multiplied by the number of unvested restricted stock as of that comparable date.

restricted stock vested during the

three

months ended

May

31,

2019.

The total pre-tax fair value of restricted stock that vested during the

three

months ended

May

31,

2018

was less than

$0.1

million. The total pre-tax fair value of restricted stock that vested during the

nine

months ended

May

31,

2019

and

2018

was

$16.7

million and

$2.8

million, respectively.

Share-based Awards Available for Grant

A summary of share-based awards available for grant is as follows:

(in thousands)	Share-based Awards Available for Grant under the Employee Stock Option Plan			Share-based Awards Available for Grant under the Non-Employee Stock Option Plan
Balance at August 31, 2018		6,298			282
Granted – non-performance-based options		(455	)		—
Restricted stock awards granted (1)		(103	)		—
Share-based awards canceled/forfeited (2)		25			—
Balance at November 30, 2018		5,765			282
Granted – non-performance-based options		(6	)		(21	)
Share-based awards canceled/forfeited (2)		65			3
Balance at February 28, 2019		5,824			264
Granted – non-performance-based options		(2	)		—
Restricted stock awards granted (1)		(1	)		—
Share-based awards canceled/forfeited (2)		80			—
Balance at May 31, 2019		5,901			264

(

)

Each restricted stock award granted is equivalent to

2.5

shares granted under the Company’s Option Plan.

(

)

Under the Company’s Option Plan, for each restricted stock award canceled/forfeited, an equivalent of

2.5

shares is added back to the available share-based awards balance.

Employee Stock Purchase Plan

Shares of FactSet common stock

may

be purchased by eligible employees under the FactSet Research Systems Inc. Employee Stock Purchase Plan, as Amended and Restated (the "ESPP") in

three

-month intervals. The purchase price is equal to

85%

of the lesser of the fair market value of the Company’s common stock on the

first

day or the last day of each

three

-month offering period. Employee purchases

may

not

exceed

10%

of their gross compensation and a

$25,000

contribution limit during an offering period.

During the

three

months ended

May

31,

2019,

employees purchased

13,350

shares at a price of

$201.54

compared to

16,312

shares at a price of

$170.86

for the

three

months ended

May

31,

2018.

During the

nine

months ended

May

31,

2019,

employees purchased

39,069

shares at a weighted average price of

$199.43

as compared to

50,706

shares at a weighted average price of

$156.88

for the

nine

months ended

May

31,

2018.

May

31,

2019,

the ESPP had

229,873

shares reserved for future issuance.

Employee Benefit Plans

FactSet sponsors benefit plans for the majority of its domestic and foreign employees. The Company contributed

$3.0

million in employer matching contributions for its U.S. defined contribution plan for both the

three

months ended

May

31,

2019

and

2018.

During the

nine

months ended

May

31,

2019

and

2018,

the Company contributed

$8.2

million and

$8.5

million in employer matching contributions for its U.S. defined contribution plan, respectively. Contributions to foreign benefit plans were

not

material to FactSet on either an individual or aggregate basis for any of the periods presented.