The Company's compensation expense in 2023 and 2022 primarily relates to restricted stock, stock-settled RSUs, and the ESPP. Restricted stock and the stock-settled RSUs are equity-classified awards for which compensation expense per share is fixed. Cash-settled RSUs are liability-classified awards for which the expense fluctuates from period to period dependent, in part, on the Company's stock price. Cash-settled RSUs were last awarded in 2019 and were fully expensed as of December 31, 2023. For 2023, 2022, and 2021, stock-based compensation expense, net of forfeitures, was recorded as follows ($ in thousands):


	2023		2022		2021
Equity-classified awards:
Restricted stock	$	3,645	$	3,151	$	2,677
Market-based RSUs	5,042		4,073		2,532
Performance-based RSUs	1,463		1,173		881
Director grants	1,601		1,471		890
Employee Stock Purchase Plan	150		191		25
	11,901		10,059		7,005

Liability-classified awards
Market-based RSUs	—		—		1,942
Performance-based RSUs	—		—		456
Service-based RSUs	61		(146)		690
Dividend equivalent units	—		69		564
	61		(77)		3,652
Total stock-based compensation expense	$	11,962	$	9,982	$	10,657

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, 2023, approximately 2.0 million shares were authorized to be awarded pursuant to the 2019 Plan.

Since 2020, the Company has annually 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 in 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 FFO per share (the “Performance-based RSUs”), and (3) restricted stock. In February 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 additional compensation expense recognized related to these modifications was not significant.

The RSU awards are equity-classified awards to be settled in stock, net of any tax withholding, 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 three-year 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 three-year 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

In 2023, 2022, and 2021, the Company granted, at target, 234,902, 141,899, and 145,413 of RSUs, respectively, to employees, which vest on December 31 of the last year of the respective three-year FFO and TSR measurement period.

The Company estimates future expense for all stock-settled RSUs outstanding at December 31, 2023 to be $6.0 million (using estimated vesting percentages for Performance-based RSUs as of December 31, 2023), which will be recognized over a weighted-average period of 1.6 years.

In 2023, 2022, and 2021, the Company granted 164,221, 99,758, and 102,262 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, 2023, the Company had $4.4 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 1.4 years. The total vesting date fair value of the restricted stock which vested during 2023, 2022, and 2021 was $2.4 million, $2.9 million, and $1.9 million, respectively.


	2023		2022		2021
	Restricted Stock and RSUs	Weighted Average Fair Market Value at Grant	Restricted Stock and RSUs	Weighted Average Fair Market Value at Grant	Restricted Stock and RSUs	Weighted Average Fair Market Value at Grant
Restricted stock and RSUs unvested at beginning of the year	463	$39.91	409	$38.63	221	$41.90
Granted	399	$29.31	242	$43.30	248	$35.44
Vested	(225)	$37.28	(169)	$41.54	(58)	$37.47
Forfeited	(8)	$37.60	(19)	$41.05	(2)	$39.27
Restricted stock and RSUs unvested at end of year (1)	629	$34.16	463	$39.91	409	$38.63

All shares of restricted stock receive dividends and have voting rights during the vesting period. Dividend equivalents for the 2023, 2022, and 2021 RSUs will be settled in cash 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 sheets.

At December 31, 2023 and 2022, the Company had no stock options outstanding to key employees or outside directors. In 2023, 2022, and 2021, 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.

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.

For 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 accrued and expensed 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 were paid out at the time of vesting in February 2023. The Company accrued and expensed these dividend equivalent units as compensation over the service period as dividends are declared.

There were no Service-based, Market-based, or Performance-based liability awards outstanding as of December 31, 2023. During 2023, 2022, and 2021, total cash paid for all types of cash-settled RSUs and related dividend payments was $1.1 million, $6.6 million, and $7.2 million, respectively.

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, 2023, 2022, and 2021, 43, 78, and 95 employees were enrolled in the plan, respectively. As of and for the years ended December 31, 2023 and 2022, 25,441 and 22,909 shares of common stock have been purchased under the ESPP, respectively. The total purchase date fair value of the shares purchased during 2023 and 2022 was $522,000 and $604,000, respectively. Contributions for the purchase period ending November 30, 2024 are expected to be $374,000. Contributions for the purchase period ending November 30, 2023 were $444,000. As of December 31, 2023, the Company estimates future expense related to the open purchase period to be $107,000.