NOTE 9. INCENTIVE AWARD PLAN

Restricted Shares of Common Stock

During the nine months ended September 30, 2020, the Company granted 148 thousand restricted shares under the Amended Incentive Award Plan to certain executive officers, directors and employees. The Company recorded $6.9 million in deferred compensation associated with these grants. Deferred compensation for restricted shares will be recognized in expense over the requisite service period. As of September 30, 2020, there were approximately 283 thousand unvested restricted shares outstanding.

Market-Based Awards

During the nine months ended September 30, 2020, the Board of Directors, or committee thereof, approved target grants of 88 thousand market-based awards to executive officers of the Company. The performance period of these grants runs primarily through December 31, 2022. Potential shares of the Corporation’s common stock that each participant is eligible to receive is based on the initial target number of shares granted, multiplied by a percentage range between 0% and 300%. Grant date fair value of the market-based share awards was calculated using the Monte Carlo simulation model, which incorporated stock price volatility of the Company and each of the Company’s peers and other variables over the time horizons matching the performance periods. Significant inputs for the calculation were expected volatility of the Company of 25.2% and expected volatility of the Company's peers, ranging from 18.1% to 27.3%, with an average volatility of 21.7% and a risk-free interest rate of 1.07%. The fair value of the market-based award per share was $67.30 as of the grant date. Stock-based compensation expense associated with unvested market-based share awards is recognized on a straight-line basis over the minimum required service period, which is generally three years.

Approximately $1.9 million and $2.7 million in dividend rights have been accrued as of September 30, 2020 and December 31, 2019, respectively. For outstanding non-vested awards at September 30, 2020, 0.3 million shares would have been released based on the Corporation’s TSR relative to the specified peer groups through that date.

Stock-based Compensation Expense

For the three months ended September 30, 2020 and 2019, the Company recognized $3.0 million and $3.5 million, respectively, in stock-based compensation expense, and for the nine months ended September 30, 2020 and 2019, the Company recognized $9.7 million and $11.0 million, respectively. These amounts are included in general and administrative expenses in the accompanying consolidated statements of operations. As of September 30, 2020, the remaining unamortized stock-based compensation expense totaled $15.4 million, comprised of $8.1 million related to restricted stock awards and $7.3 million related to market-based awards. As of December 31, 2019, the unamortized stock-based compensation expense totaled $12.6 million, comprised of $6.6 million related to restricted stock awards and $6.0 million related to market-based awards. Amortization is recognized on a straight-line basis over the service period of each applicable award.