Jefferies Financial Group Inc.JEF
Jefferies Financial Group Inc. Stock Compensation Disclosure
Note 14. Compensation Plans
Equity Compensation Plan
Our amended and restated Equity Compensation Plan (the “ECP”)
was approved by shareholders on March 28, 2024. The ECP
replaced our 2003 Incentive Compensation Plan, as Amended
and Restated (the “Incentive Plan”) and the 1999 Directors’ Stock
Compensation Plan, as Amended and Restated July 25, 2013.
The ECP is an omnibus plan authorizing a variety of equity award
types, as well as cash incentive awards, to be used for
employees, non-employee directors and other service providers.
At November 30, 2025, 11.3 million shares remain available for
new grants under the ECP.
Restricted stock awards are grants of our common shares that
generally require service as a condition of vesting. RSUs give a
participant the right to receive shares if service or performance
conditions are met and may specify an additional deferral period
allowing a participant to hold an interest tied to common stock
on a tax deferred basis. Prior to settlement, RSUs carry no voting
or dividend rights associated with stock ownership, but dividend
equivalents are accrued to the extent there are dividends
declared on the underlying common shares.
Restricted stock and RSUs may be granted to new employees as
“sign-on” awards and to existing employees as either “retention”
awards or pursuant to regulatory requirements outside the U.S.
governing remuneration for certain employees. Restricted stock
and RSUs are also granted to certain senior executive officers as
incentive awards. Employee awards are generally subject to
annual ratable vesting over a multi-year service period and may
also contain performance conditions. Restricted stock and RSUs
granted to certain senior executives may contain market,
performance and/or service conditions. Market conditions are
incorporated into the grant-date fair value of senior executive
awards using a Monte Carlo valuation model. Compensation
expense for awards with market conditions is recognized over
the service period and is not reversed if the market conditions are
not met. Awards with performance conditions are amortized over
the service period if, and to the extent, it is determined to be
probable that the performance condition will be achieved. If
awards are forfeited due to failure to achieve performance
conditions or failure to satisfy service conditions, any previously
recognized expense for such awards is reversed.
Senior Executive Compensation
In December 2021, the Board of Directors granted our senior
executives each a special long-term, five-year retention grant,
termed the Leadership Continuity Grant, with a grant date fair
value of $25.0 million. Our senior executives will gain the benefits
of the retention award after an additional three-year holding
period following the five-year service period.
The senior executives also hold previously awarded stock
options of 2,506,266 stock options, with an exercise price of
$23.75, which include rights to “excess dividend
equivalents,” (each share subject to the option is entitled to two
times the amount of any regular quarterly cash dividend paid in
the 9.5 years after grant to the extent the per share dividend
exceeds the quarterly dividend rate in effect at the time of grant
with the dividend equivalent amount converted to non-forfeitable
share units at the dividend payment date.
In connection with our spin-off of Vitesse Energy, Inc. in January
2023, the options and related dividend equivalent rights were
adjusted, resulting in each senior executive holding 2,532,370
Jefferies options exercisable at $22.69 per share and 228,933
Vitesse options exercisable at $8.97 per share, with
corresponding adjustments such that Vitesse regular quarterly
cash dividends relating to shares underlying the Vitesse options
are taken into consideration in the calculation of the excess
dividend equivalents. The stock options became or become
exercisable in three equal annual tranches beginning December
6, 2021, with a final expiration date of December 5, 2030. At
November 30, 2025, stock options of 5,064,740 were outstanding
and exercisable.
Additionally, in connection with our spin-off of Vitesse Energy,
Inc. shares, we adjusted certain outstanding equity awards to
include like awards for the acquisition of Vitesse common stock
(“Vitesse Awards”). Vesting terms, exercise dates and expiration
dates of the resulting Vitesse Awards and Vitesse options are the
same as those terms of the related Jefferies awards. For those
Vitesse Awards that remain subject to performance or service-
based vesting requirements, we continue to recognize expense
based on the original grant-date fair value and any incremental
fair value resulting from modifications of awards. In fiscal 2023,
$4.0 million of incremental compensation expense was
recognized for these modifications connection with the
adjustments relating to the Vitesse spin-off.
In addition, the Compensation Committee has granted RSUs and
performance stock units (“PSUs”) to each of our senior
executives as follows:
Period Grant | |||||
December | |||||
$ in millions | 2025 | 2024 | 2023 | 2022 | 2021 |
RSUs | |||||
Aggregate grant date fair value ................................. | $14.3 | $18.0 | $11.7 | $13.1 | $16.4 |
Vesting period ........................ | 3-year cliff | 3-year cliff | 3-year cliff | 3-year cliff | 3-year cliff |
PSUs | |||||
Aggregate target fair value .. | $14.3 | $18.0 | $8.8 | $13.1 | $16.4 |
Service period ........................ | 3 years | 3 years | 3 years | 3 years | 3 years |
Performance goals performance period ........ | Fiscal 2025 to Fiscal 2027 | Fiscal 2024 to Fiscal 2026 | Fiscal 2023 to Fiscal 2025 | Fiscal 2022 to Fiscal 2024 | Fiscal 2021 to Fiscal 2023 |
Performance target (1) .. | 10% ROTE | 10% ROTE | 10% ROTE | 10% ROTE | 10% ROTE |
Performance range (2) .. | 7.5% - 15% ROTE | 7.5% - 15% ROTE | 7.5% - 15% ROTE | 7.5% - 15% ROTE | 7.5% - 15% ROTE |
(1)ROTE is defined as return on tangible equity measured over three years.
(2)Performance below an ROTE of 7.5% results in forfeiture of all PSUs. An ROTE
of 15% or greater results in earning 150% of target PSUs and between 7.5% to
15% , the level of earning PSUs is linearly interpolated.
The following reflects activity in restricted stock, inclusive across
all plans:
In thousands, except per share amounts | Restricted Stock | Weighted- Average Grant Date Fair Value |
Balance at November 30, 2022 ................................. | 2,139 | 27.85 |
Grants ............................................................................ | 444 | 33.16 |
Fulfillment of vesting requirement ............................ | (481) | 24.09 |
Balance at November 30, 2023 ................................. | 2,102 | 29.83 |
Grants ............................................................................ | 467 | 37.09 |
Fulfillment of vesting requirement ............................ | (271) | 25.65 |
Balance at November 30, 2024 ................................. | 2,298 | 31.80 |
Grants ............................................................................ | 52 | 68.15 |
Fulfillment of vesting requirement ............................ | (189) | 33.98 |
Balance at November 30, 2025 ................................. | 2,161 | $32.50 |
The following reflects activity in total RSUs, excluding RSUs
related to senior executive compensation that contain
performance conditions:
Weighted-Average Grant Date Fair Value | ||||
In thousands, except per share amounts | Future Service Required | No Future Service Required | Future Service Required | No Future Service Required |
Balance at November 30, 2022 ............... | 2,308 | 12,655 | $33.70 | $24.55 |
Grants .......................................................... | 553 | 732 | 34.47 | 29.35 |
Distributions of underlying shares ........... | — | (5,485) | — | 23.35 |
Fulfillment of vesting requirement (1) .... | (9) | 2,685 | 21.82 | 26.50 |
Balance at November 30, 2023 ............... | 2,852 | 10,587 | 33.89 | 26.00 |
Grants .......................................................... | 972 | 448 | 38.33 | 40.06 |
Distributions of underlying shares ........... | — | (1,849) | — | 26.74 |
Fulfillment of vesting requirement (1) .... | (32) | 32 | 35.21 | 35.21 |
Balance at November 30, 2024 ............... | 3,792 | 9,218 | 35.02 | 26.57 |
Grants .......................................................... | 2,330 | 668 | 55.87 | 67.95 |
Distributions of underlying shares ........... | — | (1,362) | — | 39.20 |
Fulfillment of vesting requirement (1) .... | (604) | 1,320 | 35.14 | 39.05 |
Balance at November 30, 2025 ............... | 5,518 | 9,844 | $43.81 | $29.30 |
(1)Fulfillment of vesting requirement during the years ended November 30, 2025,
2024 and 2023, includes RSUs of 716,000, 0, and 2,438,000, respectively,
related to senior executive compensation.
The following reflects activity solely related to the portions of
RSUs related to senior executive compensation that contain
performance conditions:
In thousands, except per share amounts | Target Number of Shares | Weighted- Average Grant Date Fair Value |
Balance at November 30, 2022 ................................. | 1,971 | $28.16 |
Grants ............................................................................ | 1,379 | 30.15 |
Fulfillment of vesting requirement ............................ | (2,438) | 26.49 |
Balance at November 30, 2023 ................................. | 912 | 35.64 |
Grants ............................................................................ | 459 | 44.93 |
Balance at November 30, 2024 ................................. | 1,371 | 38.75 |
Grants ............................................................................ | 252 | 77.09 |
Forfeited ........................................................................ | (67) | 34.99 |
Fulfillment of vesting requirement ............................ | (716) | 42.37 |
Balance at November 30, 2025 ................................. | 840 | $47.53 |
During the years ended November 30, 2025, 2024 and 2023,
grants are shown with the targeted number of shares.
In December 2025, the Compensation Committee of our Board of
Directors approved a total of 200,215 PSUs relating to the
December 2023 award based on actual performance from fiscal
2023 to 2025. As a result, 46,355 PSUs were forfeited by senior
executives due to achieving actual performance below the
targeted number of shares.
Employee Stock Purchase Plan
An Employee Stock Purchase Plan (the “ESPP”) has been
implemented under both the prior Incentive Plan and the ECP. We
consider the ESPP to be noncompensatory effective January 1,
2007. The ESPP allows eligible employees to make payroll
contributions that are used to acquire shares of our stock,
generally at a discounted price.
Deferred Compensation Plan
A Deferred Compensation Plan (the “DCP”), which permits eligible
employees to defer compensation which may be deemed
invested in our common shares usually at a discount or directed
among other investment vehicles available under the DCP. We
often invest directly, as a principal, in investments corresponding
to the other investment vehicles, relating to our obligations to
perform under the DCP. The compensation deferred by our
eligible employees is expensed in the period earned. The change
in fair value of our investments in assets corresponding to the
specified other investment vehicles are recognized in Principal
transactions revenues and changes in the corresponding
deferred compensation liability are reflected as Compensation
and benefits expense.
Profit Sharing Plan
We have a profit sharing plan, covering substantially all
employees, which includes a salary reduction feature designed to
qualify under Section 401(k) of the Internal Revenue Code.
Other Compensation Plans
In connection with the HomeFed LLC (“HomeFed”) merger in
2019, HomeFed stock options were converted into options to
purchase our common shares. During the year ended November
30, 2023, all remaining HomeFed stock options were exercised at
a price of $22.20 per common share.
Restricted Cash Awards
We provide compensation to new and existing employees in the
form of cash awards or loans which are subject to ratable vesting
terms with service requirements. We amortize these awards to
compensation expense over the relevant service period, which is
generally considered to start at the beginning of the annual
compensation year.
Compensation Expense
Year Ended November 30, | |||
$ in millions | 2025 | 2024 | 2023 |
Components of compensation cost: | |||
Restricted cash awards ..................................... | $533.3 | $450.6 | $324.6 |
Restricted stock and RSUs (1) .......................... | 88.2 | 63.1 | 45.4 |
Profit sharing plan .............................................. | 13.2 | 12.7 | 11.6 |
Total compensation cost .................................. | $634.7 | $526.4 | $381.6 |
(1)Total compensation cost associated with restricted stock and RSUs include
the amortization of sign-on, retention and senior executive awards, less
forfeitures and clawbacks. Additionally, we recognize compensation costs
related to the discount provided to employees in electing to defer
compensation under the DCP. These compensation costs were approximately
$1.2 million, $0.7 million and $0.5 million for the years ended November 30,
2025, 2024 and 2023, respectively.
Remaining unamortized amounts related to certain
compensation plans at November 30, 2025:
$ in millions | Remaining Unamortized Amounts | Weighted Average Vesting Period (in Years) |
Non-vested share-based awards ............................... | $194.3 | 3.6 |
Restricted cash awards ............................................... | 909.5 | 2.5 |
Total ............................................................................... | $1,103.8 |
In December 2025, $467.3 million of restricted cash awards,
which contain a future service requirement and are related to the
2025 performance year were approved and awarded. Absent
actual forfeitures or cancellations or accelerations, the annual
compensation cost for these awards will be recognized as
follows:
Year Ended November 30, | |||||
$ in millions | 2025 | 2026 | 2027 | Thereafter | Total |
Restricted cash awards . | $87.1 | $93.3 | $89.4 | $197.5 | $467.3 |
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Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Jan 28, 2026 | Showing above |
| 2024 | Jan 28, 2025 | |
| 2023 | Jan 26, 2024 | |
| 2017 | Feb 27, 2018 | |
About Stock Compensation Disclosures
Stock-based compensation disclosures detail the equity awards granted to employees and executives — including stock options, restricted stock units (RSUs), and performance shares — along with the valuation methods and assumptions used to expense them. This section reveals the true cost of talent retention and the alignment between management incentives and shareholder interests.
Key signals: total unrecognized compensation expense and its expected recognition period signal future earnings headwinds from already-granted awards. For stock options, examine Black-Scholes assumptions — expected volatility, risk-free rate, and expected term — as understating any of these reduces reported compensation expense. Compare stock compensation expense as a percentage of revenue against peers to assess dilution cost. Watch vesting schedules for acceleration clauses tied to change-of-control events. Performance-based awards with undemanding targets may indicate weak governance. Add back stock compensation to operating cash flow to calculate a more conservative free cash flow figure.