The Company's compensation expense in 2022 relates to restricted stock and RSUs awarded in 2022, 2021, 2020, and 2019. Restricted stock and the 2022, 2021, and 2020 RSUs are equity-classified awards (settled in shares of the Company) for which compensation expense per share is fixed. The 2019 RSUs are liability-classified awards (settled in cash) for which the expense fluctuates from period to period dependent, in part, on the Company's stock price. For 2022, 2021, and 2020, stock-based compensation expense, net of forfeitures, was recorded as follows ($ in thousands):


	2022		2021		2020
Equity-classified awards:
Restricted stock	$	3,151	$	2,677	$	2,555
Market-based RSUs	4,073		2,532		1,255
Performance-based RSUs	1,173		881		428
Director grants	1,471		890		1,060
Employee Stock Purchase Plan	191		25		—
	10,059		7,005		5,298

Liability-classified awards
Market-based RSUs	—		1,942		2,498
Performance-based RSUs	—		456		258
Service-based RSUs	(146)		690		633
Dividend equivalent units	69		564		675
	(77)		3,652		4,064
Total stock-based compensation expense	$	9,982	$	10,657	$	9,362

On April 23, 2019, the Company's stockholders approved the Cousins Properties Incorporated 2019 Omnibus Incentive Stock Plan (the "2019 Plan") which allows the Company to issue awards of stock options, stock grants, or stock appreciation rights to employees and directors. The 2019 Plan also allows the Company to issue awards to employees that are paid in cash or stock on the vesting date in an amount equal to the fair market value, as defined, of one share of the Company’s stock. As of December 31, 2022, 3,249,833 shares were authorized to be awarded pursuant to the 2019 Plan. During the periods presented the Company also maintained the Cousins Properties Incorporated 2009 Incentive Stock Plan (the "2009 Plan") and the Cousins Properties Incorporated 2005 Restricted Stock Unit Plan (the “RSU Plan”), as amended, although no further issuances are permitted under the 2009 Plan or RSU Plan.

During 2022, 2021, and 2020, the Company granted three types of equity-classified awards to key employees: (1) RSUs based on the total stockholder return ("TSR) of the Company, as defined, relative to that of office peers included a published office REIT index (the "Market-based RSUs"), (2) RSUs based on the ratio of cumulative funds from operations ("FFO") per share to targeted cumulative funds from operations per share (the “Performance-based RSUs”), (3) and restricted stock. Subsequent to year end, on February 6, 2023, the Company made modifications to its Market-based RSUs awards granted in 2022, 2021 and 2020. The modifications were made to clarify the definition of the peer group used to measure TSR award achievement. The modifications do not have a significant impact on the consolidated financial statements.

The RSU awards are equity-classified awards to be settled in stock with issuance dependent upon the attainment of required service, market, and performance criteria. For the Market-based RSUs the Company expenses an estimate of the fair value of the awards on the grant date, calculated using a Monte Carlo valuation at grant date, ratably over the vesting period, adjusting only for forfeitures when they occur. The expense of these Market-based RSUs is not adjusted for the number of awards that actually vest. For the Performance-based RSUs the Company expenses the awards over the vesting period using the grant date fair market value of the Company's stock on the grant date. The expense is recognized ratably over the vesting period and adjusted each quarter based on the number of shares expected to vest and for forfeitures when they occur. The measurement period for both the market-based and performance-based RSUs is three years starting on January 1 of the year of issuance and ending on December 31 of the third year. The ultimate settlement of these awards can range from 0% to 200% of the targeted number of units depending on the achievement of the market and performance metrics described above.

The Company estimates future expense for all equity-classified RSUs outstanding at December 31, 2022 to be $5.2 million (using estimated vesting percentages for Performance-based RSUs as of December 31, 2022), which will be recognized over a weighted-average period of 1.7 years.

In 2022, 2021, and 2020, the Company granted 99,758, 102,262, and 71,421 shares, respectively, of restricted stock to employees, which vest ratably over three years from the issuance date. The Company records restricted stock in common stock and additional paid-in capital at fair value on the grant date, with the offsetting deferred compensation also recorded in additional paid-in capital. The Company records compensation expense over the vesting period. As of December 31, 2022, the Company had $3.8 million of unrecognized compensation cost included in additional paid-in capital related to restricted stock, which will be recognized over a weighted average period of 0.9 years. The total vesting date fair value of the restricted stock which vested during 2022, 2021, and 2020 was $2.9 million, $1.9 million, and $3.2 million, respectively.


	2022		2021		2020
	Shares	Weighted Average Fair Market Value at Grant	Shares	Weighted Average Fair Market Value at Grant	Shares	Weighted Average Fair Market Value at Grant
Shares unvested at beginning of the year	409	$38.63	221	$41.90	141	$34.81
Granted	242	$43.30	248	$35.44	173	$44.13
Vested	(169)	$41.54	(58)	$37.47	(82)	$34.69
Forfeited	(19)	$41.05	(2)	$39.27	(11)	$41.10
Shares unvested at end of year	463	$39.91	409	$38.63	221	$41.90

Dividend equivalents for the 2022, 2021, and 2020 RSUs will be settled in shares of the Company's common stock based upon the number of units vested. The Company accrues for these dividend equivalent units over the measurement period as dividends are declared and they are included in distributions in excess of cumulative net income on the consolidated balance sheet. The targeted number of non-vested equity-classified RSUs at December 31, 2022 is 278,371.

At December 31, 2021 and 2022, the Company had no stock options outstanding to key employees and outside directors. In 2022, 2021, and 2020, there were no stock option grants to employees or directors, and the Company recognized no compensation expense related to stock options. During 2021, the Company issued 24,626 shares for option exercises.


	2021		2020
		Number of Options	Weighted Average Exercise Price Per Option	Number of Options	Weighted Average Exercise Price Per Option
Outstanding at beginning of year		28	$25.55	67	$23.13
Exercised		(28)	$25.55	(37)	$21.28
Forfeited/expired		—	—	(2)	$22.76
Outstanding at end of year		—	—	28	$25.55

The 2019 Market-based and Performance-based RSU awards are liability-classified awards and were settled in cash in 2022 based upon the attainment of required market, performance, and service criteria for the three years ended December 31, 2021. For the 2019 Market-based RSUs, the Company expensed an estimate of the fair value of the awards over the vesting period using a quarterly Monte Carlo valuation. For the 2019 Performance-based RSUs, the Company expensed the awards over the vesting period using the fair market value of the Company’s stock at the reporting date multiplied by the anticipated number of units to be paid based on the current estimate of what the ratio is expected to be upon vesting.

Market-based and Performance-based RSUs, dividend equivalent units were paid based on the percentage vested. For the 2019 RSU grants, dividend equivalent units were paid in February 2022. The Company accrues and expenses these dividend equivalent units as compensation over the service period as dividends are declared, based on the latest projected vesting percentage.

For Time-vested RSUs, dividend equivalent units are paid based on the number of RSUs granted. For the 2019 time-vested RSU grants, dividend equivalent units will be paid out at the time of vesting in February 2023. The Company accrues and expenses these dividend equivalent units as compensation over the service period as dividends are declared.

The Company estimates future expense the Service-based liability-classified RSUs outstanding at December 31, 2022 to be $31,000 (using stock prices as of December 31, 2022), which will be recognized over a weighted-average period of 0.1 years. There were no Market-based or Performance-based liability awards outstanding as of December 31, 2022. During 2022, total cash paid for all types of liability-classified RSUs and related dividend payments was $6.6 million.

On October 26, 2021, the Company’s board of directors adopted the ESPP, which was approved by stockholders at the 2022 annual meeting. Pursuant to the ESPP, employees may contribute up to 15% of their cash compensation during annual purchase periods for the purchase of Cousins’ common stock up to an annual maximum of $21,250 per employee. On each purchase period ending November 30, participants’ individual account balances are used to acquire shares of common stock at 85% of the Company’s closing price as of December 1 (the beginning of the purchase period) or November 30 (the end of the purchase period), whichever is lower.

As of December 31, 2022 and 2021, 78 and 95 employees were enrolled in the plan, respectively. As of and for the year ended December 31, 2022, 22,909 shares of common stock have been purchased under the ESPP. The total purchase date fair value of the shares purchased during 2022 was $604,000. Contributions for the purchase period ending November 30, 2023 are expected to be $588,000. Contributions for the purchase period ending November 30, 2022 were $514,000. As of December 31, 2022, the Company estimates future expense related to the open purchase period to be $137,000.