Pinnacle Financial's Amended and Restated 2018 Omnibus Equity Incentive Plan (the "2018 Plan") permits Pinnacle Financial to reissue outstanding awards that are subsequently forfeited, settled in cash, withheld by Pinnacle Financial to cover withholding taxes or expire unexercised and returned to the 2018 Plan. At December 31, 2021, there were approximately 1.9 million shares available for issuance under the 2018 Plan.

Upon the acquisition of CapitalMark, Pinnacle Financial assumed approximately 858,000 stock options under the CapitalMark Option Plan. No further shares remain available for issuance under the CapitalMark Option Plan. At December 31, 2021, all of the remaining options outstanding under any equity incentive plan of Pinnacle Financial were granted under the CapitalMark Option Plan.

As of December 31, 2021, of the 56,147 stock options outstanding, approximately 21,443 options were granted with the intention to be incentive stock options qualifying under Section 422 of the Internal Revenue Code for favorable tax treatment to the option holder while approximately 34,704 options would be deemed non-qualified stock options and thus not subject to favorable tax treatment to the option holder. Favorable treatment generally refers to the recipient of the award not having to report ordinary income at the date of exercise assuming certain conditions are met. All stock options granted under the CapitalMark Plan were fully vested at the date of the CapitalMark merger.

A summary of stock option activity within the equity incentive plans during each of the years in the three-year period ended December 31, 2021 and information regarding expected vesting, contractual terms remaining, intrinsic values and other matters was as follows:


	Number	Weighted-Average Exercise Price		Weighted-Average Contractual Remaining Term (in years)	Aggregate Intrinsic Value (1) (000's)
Outstanding at December 31, 2018	178,591	$	22.77
Granted	—	—
Stock options exercised	(59,317)	21.40
Forfeited	—	—
Outstanding at December 31, 2019	119,274	$	23.45
Granted	—	—
Stock options exercised	(17,505)	23.40
Forfeited	—	—
Outstanding at December 31, 2020	101,769	$	23.46
Granted	—	—
Stock options exercised	(45,125)	22.18
Forfeited	(497)	20.00
Outstanding at December 31, 2021	56,147	$	24.51	1.19	$	3,985
Options exercisable at December 31, 2021	56,147	$	24.51	1.19	$	3,985

(1)The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the quoted price of Pinnacle Financial Common Stock of $95.50 per common share at December 31, 2021 for the 56,147 options that were in-the-money at December 31, 2021.

During 2021, 2020 and 2019, the aggregate intrinsic value of stock options exercised under Pinnacle Financial's equity incentive plans was $3.0 million, $350,000 and $2.3 million, respectively, determined as of the date of option exercise.

There have been no options granted by Pinnacle Financial since 2008. All stock option awards granted by Pinnacle Financial were fully vested during 2013. Stock options granted under the CapitalMark Plan were fully vested at the time of acquisition. As such, there was no impact on the results of operations for stock-based compensation related to stock options for any year in the three-year period ended December 31, 2021, except for the tax impact recorded as a component of income tax expense upon exercise.

A summary of activity for unvested restricted share awards for the years ended December 31, 2021, 2020, and 2019 follows:


	Number	Grant Date Weighted-Average Cost
Unvested at December 31, 2018	692,806	$	55.19
Shares awarded	245,845	55.25
Restrictions lapsed and shares released to associates/directors	(348,145)	40.47
Shares forfeited	(35,210)	58.22
Unvested at December 31, 2019	555,296	$	57.04
Shares awarded	284,904	55.91
Restrictions lapsed and shares released to associates/directors	(215,846)	55.39
Shares forfeited	(29,685)	59.64
Unvested at December 31, 2020	594,669	$	56.97
Shares awarded	249,641	77.00
Restrictions lapsed and shares released to associates/directors	(193,846)	56.47
Shares forfeited	(37,129)	62.79
Unvested at December 31, 2021	613,335	$	64.93

Pinnacle Financial grants restricted share awards to associates (including certain members of executive management) and outside directors with time-based vesting criteria. The following tables outline restricted stock grants that were made by grant year, grouped by similar vesting criteria, during the three-year period ended December 31, 2021. The table below reflects the life-to-date activity for these awards:


Grant year	Group (1)	Vesting period in years			Shares awarded	Restrictions lapsed and shares released to participants	Shares withheld for taxes by participants	Shares forfeited by participants (4)	Shares unvested
Time Based Awards
2019	Associates (2)	3	—	5	229,296	58,734	23,995	30,030	116,537
2020	Associates (2)	3	—	5	266,379	40,692	16,847	18,660	190,180
2021	Associates (2)	3	—	5	237,811	139	92	13,514	224,066
Outside Director Awards (3)
2019	Outside directors	1			16,549	14,582	1,967	—	—
2020	Outside directors	1			18,525	16,327	2,198	—	—
2021	Outside directors	1			11,830	—	—	—	11,830

(1)Groups include employees (referred to as associates above) and outside directors. When the restricted shares are awarded, a participant receives voting rights and forfeitable dividend rights with respect to the shares, but is not able to transfer the shares until the restrictions have lapsed. Once the restrictions lapse, the participant is taxed on the value of the award and may elect to sell some shares (or have Pinnacle Financial withhold some shares) to pay the applicable income taxes associated with the award. Alternatively, the recipient can pay the withholding taxes in cash. For time-based vesting restricted share awards, dividends paid on shares for which the forfeiture restrictions do not lapse will be recouped by Pinnacle Financial at the time of termination. For awards to Pinnacle Financial's directors, dividends are placed into escrow until the forfeiture restrictions on such shares lapse.

(3)Restricted share awards are issued to the outside members of the board of directors in accordance with their board compensation plan. Restrictions lapse on March 1, 2022 based on each individual board member meeting attendance goals for the various board and board committee meetings to which each member

(4)These shares represent forfeitures resulting from recipients whose employment or board membership was terminated during the year-to-date period ended December 31, 2021. Any dividends paid on shares for which the forfeiture restrictions do not lapse will be recouped by Pinnacle Financial at the time of termination or will not be distributed from escrow, as applicable.

Compensation expense associated with the time-based vesting restricted share awards is recognized over the time period that the restrictions associated with the awards lapse on a straight-line basis based on the total cost of the award.

In 2021, Pinnacle Financial granted restricted stock units to its Named Executive Officers (NEOs) and leadership team members with time-based vesting criteria. Compensation expense associated with time-based vesting restricted stock unit awards is recognized over the time period that the restrictions associated with the awards lapse on a straight-line basis based on the total cost of the award. The following table outlines restricted stock unit grants that were made, grouped by similar vesting criteria, during the year ended December 31, 2021. The table reflects the life-to-date activity for these awards:


Grant year	Vesting period in years	Shares awarded	Restrictions lapsed and shares released to participants	Shares withheld for taxes by participants	Shares forfeited by participants (1)	Shares unvested
2021	3	56,864	89	39	368	56,368

(1)These shares represent forfeitures resulting from recipients whose employment was terminated during the year-to-date period ended December 31, 2021. Dividend equivalents are held in escrow for award recipients for dividends paid prior to the forfeiture restrictions lapsing. Such dividend equivalents are not released from escrow if an award is forfeited.


	Units Awarded				Applicable performance periods associated with each tranche (fiscal year)	Service period per tranche (in years)	Subsequent holding period per tranche (in years)	Period in which units to be settled into shares of common stock (2)
Grant year	Named Executive Officers (NEOs) (1)			Leadership Team other than NEOs
2021(3)	89,234	—	214,155	45,240	2021-2023	0	0	2024
2020	136,137	—	204,220	59,648	2020	2	3	2025
					2021	2	2	2025
					2022	2	1	2025
2019	166,211	—	249,343	52,244	2019	2	3	2024
					2020	2	2	2024
					2021	2	1	2024
2018	96,878	—	145,339	25,990	2018	2	3	2023
					2019	2	2	2023
					2020	2	1	2023
2017	72,537	—	109,339	24,916	2017	2	3	2022
					2018	2	2	2022
					2019	2	1	2022

(2)Performance stock unit awards granted prior to 2021, if earned, will be settled in shares of Pinnacle Financial Common Stock in the periods noted in the table, if Pinnacle Bank's ratio of non-performing assets to its loans plus ORE ("NPA Ratio") is less than amounts established in the applicable award agreement.

(3)Performance stock unit awards granted in 2021, if earned, will be settled in shares of Pinnacle Financial Common Stock in the period noted in the table, if the performance criterion included in the applicable performance unit award agreement, including the NPA Ratio, are met.

During the years ended December 31, 2021 and 2020, the restrictions associated with 134,146 performance stock unit awards and 129,723 performance stock unit awards, respectively, granted in prior years lapsed, based on the terms of the applicable award agreement and approval by Pinnacle Financial's Human Resources and Compensation Committee, and were settled into shares of Pinnacle Financial common stock with 46,616 shares and 43,996 shares, respectively, being withheld to pay the taxes associated with

A summary of stock compensation expense, net of the impact of income taxes, related to restricted share awards, restricted stock unit awards and performance stock unit awards for the three-year period ended December 31, 2021, follows (in thousands):