HTLF may grant, through its Compensation, Nominating and Corporate Governance Committee (the "Compensation Committee") non-qualified and incentive stock options, stock appreciation rights, stock awards, restricted stock, restricted stock units and cash incentive awards, under its 2020 Long-Term Incentive Plan (the "Plan") which authorized 1,460,000 of common stock available for issuance. At December 31, 2022, 963,563 shares of common stock were reserved for future issuance under awards that may be granted under the Plan to employees and directors of, and service providers to, HTLF or its subsidiaries.

ASC Topic 718, "Compensation-Stock Compensation" requires the measurement of the cost of employee services received in exchange for an award of equity instruments based upon the fair value of the award on the grant date. The cost of the award is based upon its fair value estimated on the date of grant and recognized in the consolidated statements of income over the vesting period of the award. The fair market value of restricted stock and restricted stock units is based on the fair value of the underlying shares of common stock on the date of grant. Forfeitures are accounted for as they occur.

HTLF's income tax expense included $131,000 and $312,000 of tax benefit for the years ended December 31, 2022, and December 31, 2021, respectively, related to the vesting and forfeiture of equity-based awards.

The Plan permits the Compensation Committee to grant restricted stock units ("RSUs"). The time-based RSUs represent the right, without payment, to receive shares of HTLF common stock at a specified date in the future. Generally, the time-based RSUs vest over three years in equal installments in March of each of the three years following the year of the grant.

The Compensation Committee has granted three-year performance-based RSUs. These performance-based RSUs will be earned based upon satisfaction of performance targets for the three-year performance period, which is defined in the RSU agreement. These performance-based RSUs or a portion thereof may vest after measurement of performance in relation to the performance targets.

The time-based RSUs may also vest upon death or disability, upon a change in control or upon a "qualified retirement" (as defined in the RSU agreement), and the three-year performance-based RSUs vest to the extent that they are earned upon death or disability or upon a "qualified retirement" (as defined in the RSU agreement) after measurement of performance.

A summary of the status of RSUs as of December 31, 2022, 2021 and 2020, and changes during the years ended December 31, 2022, 2021, and 2020, follows:


	2022			2021			2020
	Shares	Weighted-Average Grant Date Fair Value		Shares	Weighted-Average Grant Date Fair Value		Shares	Weighted-Average Grant Date Fair Value
Outstanding at January 1	389,885	$	44.19	348,275	$	38.22	254,383	$	46.76
Granted	242,718	48.38		216,560	51.44		232,586	32.06
Vested	(159,880)	44.96		(149,350)	40.83		(119,916)	44.47
Forfeited	(48,637)	45.49		(25,600)	40.96		(18,778)	46.10
Outstanding at December 31	424,086	$	46.15	389,885	$	44.19	348,275	$	38.22

Total compensation costs recorded for RSUs were $7.8 million, $8.5 million and $7.2 million, for 2022, 2021 and 2020, respectively. As of December 31, 2022, there were $9.1 million of total unrecognized compensation costs related to the Plan for RSUs which are expected to be recognized through 2025.

The plan provides the Compensation Committee the authority to grant stock options. During the year ended December 31, 2022, 64,518 of options were granted, and the fair value of the options granted was determined using the Black-Scholes valuation model. There were no options granted in the years ended December 31, 2021 and 2020. The options granted in 2022 generally vest over the first four years in equal installments on the anniversary date of the grant. The exercise price of the stock options granted is established by the Compensation Committee, but the exercise price may not be less than the fair market value of the shares on the date the options are granted.

The stock options may also vest upon death or disability, upon a change in control or upon a "qualified retirement" as defined in the stock option agreement.

A summary of the status of the stock options as of December 31, 2022, 2021, and 2020, and changes during the years ended December 31, 2022, 2021, and 2020 follows:


	2022			2021			2020
	Shares	Weighted Average Exercise Price		Shares	Weighted Average Exercise Price		Shares	Weighted Average Exercise Price
Outstanding at January 1,	—	$	—	—	$	—	—	$	—
Granted	64,518	48.79		—	—		—	—
Exercised	—	—		—	—		—	—
Forfeited	—	—		—	—		—	—
Outstanding at December 31	64,518	48.79		—	—		—	—
Options exercisable at December 31,	—	$	—	—	$	—	—	$	—

At December 31, 2022, the vested options have a weighted average remaining contractual life of 9.92 years. The intrinsic value for the vested options as of December 31, 2022, was $0. The intrinsic value for the total of all options exercised during year ended December 31, 2022, was $0. The total fair value of shares under stock options that vested during the year ended December 31, 2022, was $0. Total compensation costs recorded for stock options were $167,000, $0, and $0 for 2022, 2021, and 2020, respectively.

HTLF maintains an employee stock purchase plan (the "ESPP"), which was adopted in May 2016 and replaced the 2006 ESPP, that permits all eligible employees to purchase shares of HTLF common stock at a discounted price as determined by the Compensation Committee. Under ASC Topic 718, compensation expense related to the ESPP of $214,000 was recorded in 2022, $228,000 was recorded in 2021, and $186,000 was recorded in 2020.