The following table summarizes the activity of our time-vested restricted stock units (“RSUs”) for the three months ended March 31, 2026:


	Three Months Ended March 31, 2026
	Shares	Weighted Average Grant Date Fair Value
Beginning balance	222,828	$	86.51
Granted	110,997	$	42.61
Vested	(2,995)	$	71.97
Forfeited	(30,882)	$	104.36
Ending balance	299,948	$	68.63

We recognized $1.5 million and $1.7 million of stock-based compensation expense related to outstanding RSUs for the three months ended March 31, 2026 and 2025, respectively. Generally, the RSUs cliff vest on the third anniversary of the grant date and can only be settled in shares of our common stock. At March 31, 2026, we had unrecognized compensation cost of $11.6 million related to unvested RSUs, which is expected to be recognized over a weighted average period of 2.1 years.

The Compensation Committee of the Board has granted awards of performance-based RSUs (“PSUs”) under the Amended and Restated LGI Homes, Inc. 2013 Equity Incentive Plan to certain members of senior management based on three-year performance cycles. The PSUs provide for shares of our common stock to be issued based on the attainment of certain performance metrics over the applicable three-year periods. The number of shares of our common stock that may be issued to the recipients for the PSUs range from 0% to 200% of the target amount depending on actual results as compared to the target performance metrics. The terms of the PSUs provide that the payouts will be capped at 100% of the target number of PSUs granted if absolute total stockholder return is negative during the performance period, regardless of EPS performance; this market condition applies for amounts recorded above target. The compensation expense associated with the PSU grants is determined using the derived grant date fair value, based on a third-party valuation analysis, and expensed over the applicable period. The PSUs vest upon the determination date for the actual results at the end of the three-year period and require that the recipients continue to be employed by us through the determination date. The PSUs can only be settled in shares of our common stock.

At March 31, 2026, management estimates that the recipients will receive approximately 51.6% of the weighted average target number of PSUs outstanding at the end of the applicable three-year performance cycle based on projected performance compared to the target performance metrics. We recognized $0.6 million and $0.6 million of total stock-based compensation expense related to outstanding PSUs for the three months ended March 31, 2026 and 2025, respectively. At March 31, 2026, we had unrecognized compensation cost of $8.3 million, based on the probable amount, related to unvested PSUs, which is expected to be recognized over a weighted average period of 3 years. PSUs granted in 2024, 2025, and 2026 are excluded from the calculation of diluted EPS as they are subject to unsatisfied performance conditions.