The Board, on behalf of the general partner of StoneMor Partners L.P., originally approved the incentive plan (as amended from time to time, the “2019 Plan”) effective March 27, 2019 and an amendment thereto on December 18, 2019 that increased to 8,500,000 the number of units authorized for issuance under the incentive plan. On December 31, 2019, the Board approved the assumption of the incentive plan and all outstanding awards thereunder by the Company in connection with the C-Corporation Conversion. On May 5, 2020, the Board approved the second amendment to the incentive plan, which increased the number of shares of common stock reserved for delivery under the incentive plan by 1,375,000 shares, and our stockholders approved the 2019 Plan at the 2020 Annual Meeting of Stockholders.

The 2019 Plan is intended to promote the interests of the Company by providing to employees, consultants and directors of the Company incentive compensation awards to encourage superior performance and enhance the Company’s ability to attract and retain the services of individuals who are essential for its growth and profitability and to encourage them to devote their best efforts to advancing the Company’s business.

During the years ended December 31, 2020 and 2019, the Compensation Committee approved the granting of non-qualified stock options to employees of the Company, including certain members of senior management, to purchase an aggregate of 800,000 and 5.5 million common shares, respectively, with a weighted average grant date fair value of $0.49 per share and $0.34 per share, respectively. The option awards vest in three equal annual installments on the anniversary of the grant date (or first business day thereafter), provided that the recipient remains employed by the Company. The Company measured the grant-date fair values of the options utilizing the Black-Scholes model and recognizes stock-based compensation expense on a straight-line basis over the weighted-average service period, which is expected to be three years. The option awards expire no later than 10 years from the date of grant.

	Number of Stock Options			Weighted Average Exercise Price Per Share ($)
Total outstanding at December 31, 2019		5,500,000			1.20
Granted		800,000			1.71
Exercised		—			—
Forfeited		(225,000	)		1.20
Expired		—			—
Total outstanding at December 31, 2020		6,075,000			1.27
Options expected to vest		6,075,000			1.27
Options exercisable		1,758,333			1.20

At December 31, 2020, the aggregate intrinsic value of total options outstanding and expected to vest was $8.3 million and the weighted average remaining contractual term was 9.1 years. The aggregate intrinsic value of options exercisable at December 31, 2020 was $2.5 million. The total fair value of options vested during the year ended December 31, 2020 was $0.6 million.

For the year ended December 31, 2020, non-cash compensation expense related to stock options was $0.6 million and such expense was not material for the year ended December 31, 2019. As of December 31, 2020, total unrecognized compensation cost related to unvested stock options was $1.6 million, which the Company expects to recognize over the remaining weighted-average period of 2.2 years.

Assumptions used in calculating the fair value of stock options granted during the year are summarized below:

	2020			2019
Valuation assumptions:
Risk-free interest rate		0.50	%		1.78	%
Expected volatility		31.15	%		23.41	%
Expected term (years)		6.0			6.0
Exercise price per stock option	$	1.71		$	1.20
Expected dividend yield	None			None

On December 3, 2020, the Compensation Committee approved the granting of 800,000 shares of restricted common stock to employees of the Company, including certain members of senior management. The restricted stock awards vest in three equal annual installments on the anniversary of the grant date (or first business day thereafter), provided that the recipient remains employed by the Company.

Restricted phantom stock awards represent contingent rights to receive a common share or an amount of cash, or a combination of both, based upon the value of a common share. Phantom shares become payable, in cash or common stock, at the Company’s election, upon the separation of the holder from service or upon the occurrence of certain other events specified in the 2019 Plan or the underlying agreements. During the year ended December 31, 2020, the Company granted 106,189 restricted phantom shares to directors.

A rollforward of restricted stock and phantom stock awards as of December 31, 2020 is as follows:

	Number of Restricted Stock and Phantom Stock Awards			Weighted Average Grant Date Fair Value ($)
Total non-vested at December 31, 2019		559,218			3.67
Granted		906,189			1.65
Vested		(187,500	)		3.88
Forfeited		—			—
Total non-vested at December 31, 2020		1,277,907			2.17

For the years ended December 31, 2020 and 2019, the Company recognized $0.8 million and $3.6 million, respectively, of non-cash compensation expense related to restricted stock and phantom stock awards into earnings. As of December 31, 2020, total unamortized compensation cost related to unvested restricted stock awards was $2.4 million, which the Company expects to recognize over the remaining weighted-average period of 2.3 years.

On April 15, 2019, the Compensation Committee approved the award of 1,015,047 phantom unit awards consisting of 494,421 phantom units subject to time-based vesting (“TVUs”) and 520,626 phantom units subject to performance-based vesting (“PVUs”) to certain members of the Company’s senior management. The TVUs had a vesting period equal to three equal annual installments on each April 3 (or first business day thereafter) commencing on April 3, 2020. The PVUs vested based on the extent, if any, to which the Compensation Committee determines that the performance conditions established by the Compensation Committee have been achieved or waived in writing. Also on April 15, 2019, an additional 275,000 restricted units were awarded to an officer of the Company pursuant to his employment agreement that were scheduled to vest in equal quarterly installments over a four-year period commencing on July 15, 2019, the three month anniversary of the grant date.

The Recapitalization Transactions, described in Note 1 General, resulted in a Change of Control as defined in the 2019 Plan. The Change of Control accelerated the vesting of certain awards, including all those granted on April 15, 2019, resulting in the immediate vesting of 1,351,493 phantom and restricted units. These awards were net settled with 376,351 units withheld to satisfy the participants’ tax withholding obligations, resulting in a net number of 975,142 common units to be issued. The Company recognized $2.2 million in stock-based compensation expense related to this accelerated vesting. These units were delivered in the third quarter of 2019.

In addition, an aggregate of 238,554 phantom units issued under the LTIP and held in deferred compensation accounts for certain directors that either became payable as a result of the Recapitalization Transactions or had previously become payable were issued in the third quarter of 2019.