Note 17 – Share-Based Compensation

In June 2017, the Company's Board of Directors adopted, and the Company's stockholder approved, the 2017 Omnibus Incentive Compensation Plan (the " 2017 Omnibus Plan"). The 2017 Omnibus Plan provided for the grant of stock options, stock appreciation rights, restricted stock, restricted stock units, dividend equivalent rights and other equity-based, equity-related or cash-based awards. A total of 2,600,000 shares of our common stock were reserved for issuance under the Omnibus Plan.

In April 2026 the Company's Board of Directors adopted, and in June 2026, the Company's stockholders approved, the 2026 Omnibus Incentive Compensation Plan (the "2026 Omnibus Plan"). The 2026 Omnibus Plan provides for the grant of stock options, stock appreciation rights, restricted stock, restricted stock units, dividend equivalent rights, other equity-based, equity-related or cash-based awards, and performance-based awards. A total of 1,697,594 shares of our common stock have been reserved for issuance under the 2026 Omnibus Plan. Upon approval of the 2026 Omnibus Plan, remaining shares eligible to be issued under the 2017 Omnibus Plan were canceled. As of June 30, 2026, there were 1,694,528 shares available for future grants under the 2026 Omnibus Plan.

The Company primarily grants time-based restricted share awards that vest over a one to four year period, subject to continued employment. The Company also grants performance-based restricted share awards. The number of shares which may be earned under the award is dependent upon the Company’s return on average assets, weighted equally over a three-year period and measured against a peer group consisting of publicly-traded bank holding companies. Results will be measured cumulatively at the end of the three years. Any earned shares will vest on the third anniversary of the grant date.

During 2026, the Company granted 307,366 shares of restricted common stock, par value $0.01 per share. Of this total, 5,822 restricted shares will vest on the first anniversary of the grant date, 222,229 restricted shares will vest ratably over three years on each anniversary of the grant date, and 15,836 restricted shares will cliff vest on the third anniversary of the grant date, all subject to continued employment. In addition, 63,479 performance-based restricted shares were included in the 2026 grant. The number of performance-based shares which may be earned under the award is dependent upon the Company’s total stockholder return and return on average assets, weighted equally, over a three-year period ending December 31, 2028, measured against the KBW Regional Bank Index. Results will be measured cumulatively at the end of the three years and any earned shares will vest on the third anniversary of the grant date.

A total of 364,254 restricted shares vested during the six months ended June 30, 2026. A total of 336,592 restricted shares vested during the year ended December 31, 2025. The fair value of restricted shares that vested during the six months ended June 30, 2026 was $12.1 million. The fair value of restricted shares that vested during the year ended December 31, 2025 was $9.6 million.

The Company recognizes share-based compensation based on the estimated fair value of the restricted stock at the grant date. Share-based compensation expense is included in non-interest expense in the Condensed Consolidated Statements of Operations. The fair value of the total stock return performance-based awards granted in 2026 and 2025 were calculated based on a Monte Carlo simulation, using the following assumptions:

The following table summarizes restricted stock compensation expense for the periods presented:

The fair value of the unvested restricted stock awards at June 30, 2026 was $26.3 million.

Pursuant to the terms of the Agreement and Plan of Merger with First Evanston and its subsidiaries, dated as of November 27, 2017 (the "First Evanston Merger Agreement"), each outstanding First Evanston option held by a participant in the First Evanston Bancorp, Inc. Stock Incentive Plan (the "FEB Plan") ceased to represent a right to acquire shares of First Evanston common stock and was assumed and converted automatically into a fully vested and exercisable adjusted option to purchase shares of Byline common stock (each an "Adjusted Option"). In accordance with the First Evanston Merger Agreement, the number of shares of Byline common stock to which each such Adjusted Option relates is equal to the product (rounded down to the nearest whole share of Byline common stock) of: (a) the number of shares of First Evanston common stock subject to the First Evanston option immediately prior to May 31, 2018, multiplied by (b) 4.725. Each Adjusted Option has an exercise price per share of Byline common stock equal to the quotient (rounded up to the nearest whole cent) of (x) the per share exercise price of such First Evanston option immediately prior to May 31, 2018, divided by (y) 4.725. The description of the conversion process is based on, and qualified by, the First Evanston Merger Agreement.

Under the FEB plan, 10,867 options were exercised during the six months ended June 30, 2026, with proceeds of $138,000 and a related tax benefit of $59,000. A total of 18,330 stock options were exercised under the FEB plan during the during the year ended December 31, 2025, with proceeds of $214,000 and a related tax benefit of $83,000.