Exelon grants stock-based awards through its LTIP, which primarily includes performance share awards, restricted stock units, and stock options. At December 31, 2022, there were approximately 34 million shares authorized for issuance under the LTIP. For the years ended December 31, 2022, 2021, and 2020, exercised and distributed stock-based awards were primarily issued from authorized but unissued common stock shares.

Separation-related Adjustments. In connection with the separation, Exelon and Constellation entered into an Employee Matters Agreement, effective February 1, 2022. Under the terms of the Employee Matters Agreement,

and pursuant to the terms of the LTIP, the Compensation Committee of the Board of Exelon approved an adjustment to outstanding awards granted under the LTIP in order to preserve the intrinsic aggregate value of such awards before the separation. The separation-related adjustments did not have a material impact on either compensation expense or the potentially dilutive securities to be considered in the calculation of diluted earnings per share of common stock. Former Exelon employees transferred to Constellation as a result of the separation surrendered their outstanding unvested Exelon awards effective February 1, 2022.

The Registrants grant cash awards. The following table does not include expense related to these plans as they are not considered stock-based compensation plans under the applicable authoritative guidance.

The following table presents the stock-based compensation expense included in Exelon's Consolidated Statements of Operations and Comprehensive Income. The Utility Registrants' stock-based compensation expense for the years ended December 31, 2022, 2021, and 2020 was not material.


	Year Ended December 31,
Exelon	2022		2021		2020
Total stock-based compensation expense included in operating and maintenance expense	$	41	$	95	$	37
Income tax benefit	(10)		(25)		(9)
Total after-tax stock-based compensation expense	$	31	$	70	$	28

Exelon receives a tax deduction based on the intrinsic value of the award on the exercise date for stock options and the distribution date for performance share awards and restricted stock units. For each award, throughout the requisite service period, Exelon recognizes the tax benefit related to compensation costs. The following table presents information regarding Exelon’s realized tax benefit when distributed:

Performance share awards are granted under the LTIP. The performance share awards are settled 50% in common stock and 50% in cash at the end of the three-year performance period, except for awards that are settled 100% in cash if certain ownership requirements are satisfied.

The common stock portion of the performance share awards is considered an equity award and is valued based on Exelon's stock price on the grant date. The cash portion of the performance share awards is considered a liability award which is remeasured each reporting period based on Exelon’s current stock price. As the value of the common stock and cash portions of the awards are based on Exelon’s stock price during the performance period, coupled with changes in the total shareholder return modifier and expected payout of the award, the compensation costs are subject to volatility until payout is established.

For nonretirement-eligible employees, stock-based compensation costs are recognized over the vesting period of three years using the straight-line method. For performance share awards granted to retirement-eligible employees, the value of the performance shares is recognized ratably over the vesting period, which is the year of grant.


	Shares	Weighted Average Grant Date Fair Value (per share)
Nonvested at December 31, 2021(a)	1,222,516	$	44.96
Granted	727,697	43.05
Change in performance	(216,981)	42.73
Vested	(233,318)	47.39
Forfeited	(86,128)	42.61
Awards surrendered as a result of the separation	(2,308,745)
Awards granted in conversion as a result of the separation	1,870,990
Undistributed vested awards(b)(c)	(109,226)	4.55
Nonvested at December 31, 2022(a)	866,805	$	41.86

(a)Excludes 1,539,819 and 1,934,238 of performance share awards issued to retirement-eligible employees as of December 31, 2022 and 2021, respectively, as they are fully vested.

(b)The significant reduction in weighted average grant date fair value during 2022 primarily resulted from more pre-separation shares being surrendered than shares issued to Exelon retirement eligible employees post-separation.


	Year Ended December 31,
	2022(a)		2021		2020
Weighted average grant date fair value (per share)	$	43.05	$	43.37	$	46.61
Total fair value of performance shares vested	29		44		39
Total fair value of performance shares settled in cash	25		28		63

(a)As of December 31, 2022, $12 million of total unrecognized compensation costs related to nonvested performance shares are expected to be recognized over the remaining weighted-average period of 1.8 years.

Restricted stock units are granted under the LTIP with the majority being settled in a specific number of shares of common stock after the service condition has been met. The corresponding cost of services is measured based on the grant date fair value of the restricted stock unit issued.

The value of the restricted stock units is expensed over the requisite service period using the straight-line method. The requisite service period for restricted stock units is generally three to five years. However, certain restricted stock unit awards become fully vested upon the employee reaching retirement-eligibility. The value of the restricted stock units granted to retirement-eligible employees is either recognized ratably over the first six months in the year of grant if the employee reaches retirement eligibility prior to July 1st of the grant year or through the date of which the employee reaches retirement eligibility. Exelon processes forfeitures as they occur for employees who do not complete the requisite service period.


	Shares	Weighted Average Grant Date Fair Value (per share)
Nonvested at December 31, 2021(a)	1,142,049	$	43.52
Granted	468,514	42.97
Vested	(499,621)	42.28
Forfeited	(71,816)	41.89
Awards surrendered as a result of the separation	(943,509)
Awards granted in conversion as a result of the separation	643,994
Undistributed vested awards(b)	(178,450)	38.24
Nonvested at December 31, 2022(a)	561,161	$	41.98

(a)Excludes 476,592 and 609,934 of restricted stock units issued to retirement-eligible employees as of December 31, 2022 and 2021, respectively, as they are fully vested.


	Year Ended December 31,
	2022(a)		2021		2020
Weighted average grant date fair value (per share)	$	42.97	$	44.21	$	46.33
Total fair value of restricted stock units vested	23		34		54

(a)As of December 31, 2022, $11 million of total unrecognized compensation costs related to nonvested restricted stock units are expected to be recognized over the remaining weighted-average period of 1.90 years.

Non-qualified stock options to purchase shares of Exelon’s common stock were granted through 2012 under the LTIP. The exercise price of the stock options is equal to the fair market value of the underlying stock on the date of option grant. Stock options will expire no later than ten years from the date of grant.


	Shares	Weighted Average Exercise Price (per share)		Weighted Average Remaining Contractual Life (years)	Aggregate Intrinsic Value
Balance of shares outstanding at December 31, 2021	27,007	$	46.47	0.15	$	—
Options exercised	(27,644)	38.56			—

Options expired	—	—
Awards surrendered as a result of the separation	(2,000)
Awards granted in conversion as a result of the separation	2,637
Balance of shares outstanding at December 31, 2022	—	$	—	0	$	—
Exercisable at December 31, 2022	—	$	—	0	$	—