Compensation expense is recognized on a straight-line basis over the requisite service period. The share-based compensation expense related to restricted stock awards granted under the CBL & Associates Properties, Inc. 2021 Equity Incentive Plan ("EIP") was $1,701 and $3,374 for the three and six months ended June 30, 2026, respectively. The share-based compensation expense related to restricted stock awards granted under the CBL & Associates Properties, Inc. 2021 EIP was $2,276 and $4,402 for the three and six months ended June 30, 2025, respectively. Share-based compensation cost capitalized as part of real estate assets was $26 and $53, for the three and six months ended June 30, 2026, respectively. Share-based compensation cost capitalized as part of real estate assets was $32 and $62 for the three and six months ended June 30, 2025, respectively. Share-based compensation cost resulting from share-based awards is recorded at the Management Company, which is a taxable entity.

A summary of the status of the Company’s unvested restricted stock awards as of June 30, 2026, and changes during the six months ended June 30, 2026, are presented below:


	Shares			Weighted- Average Grant-Date Fair Value Per Share
Unvested at January 1, 2026		338,056		$	28.35
Granted		171,158		$	36.05
2023 PSUs earned and granted as restricted stock		392,257		$	38.79
Vested		(177,834	)	$	27.46
Forfeited		(2,001	)	$	32.20
Unvested at June 30, 2026		721,636		$	36.06

The total grant date fair value of the 2023 PSUs that were earned and were granted as restricted stock awards was $15,214 and the total grant date fair value of the remaining restricted stock awards granted during the six months ended June 30, 2026 was $6,169. The total fair value of restricted stock awards that vested during the six months ended June 30, 2026 was $6,437.

Compensation cost for the PSUs granted in February 2023, February 2024, February 2025 and February 2026 is recognized on a straight-line basis over the service period since it is longer than the performance period. The resulting expense is recorded regardless of whether any PSU awards are earned as long as the required service period is met. Share-based compensation expense related to the PSUs granted under the 2021 Equity Incentive Plan was $769 and $1,433 for the three and six months ended June 30, 2026, respectively. Share-based compensation expense related to the PSUs granted under the 2021 Equity Incentive Plan was $1,981 and $3,815 for the three and six months ended June 30, 2025, respectively.

A summary of the status of the Company’s outstanding PSU awards as of June 30, 2026, and changes during the six months ended June 30, 2026, are presented below:


	PSUs			Weighted- Average Grant-Date Fair Value Per Share
Unearned at January 1, 2026		535,849		$	31.78
2026 PSUs granted		111,528		$	29.22
Incremental PSUs granted (1)		13,037		$	43.69
Earned (2)		(196,128	)	$	36.21
Unearned at June 30, 2026		464,286		$	29.63

(1)

PSUs granted shall be adjusted as if the shares of common stock represented by such PSUs had received any applicable stock or cash dividends declared. For stock dividends, a number of PSUs shall be added to the target amount corresponding to the number of shares of common stock that would have been payable per such stock dividend on the then outstanding number of PSUs under the agreement as if common stock had been issued for such PSUs. For cash dividends, a number of PSUs shall be added to the target amount corresponding to the number of shares of common stock that could have been acquired by the cash dividend payable on the then outstanding number of PSUs under the agreement as if common stock had been issued for such PSUs, and the calculation of the number of shares of common stock that could have been acquired shall be based on the closing price of the common stock on the record date for the cash dividend at issue.

(2)

The February 2023 PSUs were earned as of December 31, 2025 and were granted as restricted stock awards in February 2026 that will vest over a one-year service period.

The total grant-date fair value of PSU awards granted during the six months ended June 30, 2026 was $3,259.

The following table summarizes the assumptions used in the Monte Carlo simulation pricing model related to the PSUs granted in 2026:


	2026 PSUs
Grant date	February 11, 2026
Fair value per share on valuation date (1)	$	29.22
Risk-free interest rate (2)		3.50	%
Expected share price volatility (3)		25.00	%

(1)

The value of the 2026 PSU awards is estimated on the date of grant using a Monte Carlo simulation model. The valuation consists of computing the fair value using CBL's simulated stock price as well as TSR over a three-year performance period. The award is modeled as a contingent claim in that the expected return on the underlying shares is risk-free and the rate of discounting the pay off of the award is also risk-free. The weighted-average fair value per share related to the 2026 PSUs consists of 33,366 PSUs at a fair value of $36.40 per share (which relates to the relative TSR) and 78,162 PSUs at a fair value of $26.16 per share (which relates to absolute TSR).

(2)

The risk-free interest rate was based on the yield curve on zero-coupon U.S. Treasury securities in effect as of the valuation date, which is the grant date listed above.

(3)

The computation of expected volatility for the 2026 PSUs was based on the historical volatility of CBL's shares of common stock for a trading period equal to the time from the grant date to the end of the performance period.

As of June 30, 2026, there was $16,879 of total unrecognized compensation cost related to unvested restricted stock awards and PSUs, which is expected to be recognized over a weighted-average period of 2.3 years.