The Company grants various types of stock-based awards including stock options and restricted stock units (“RSUs”). Stock-based awards are valued on the date of grant and are expensed over the required service period. Total stock-based compensation expense recognized during the years ended December 31, 2022, 2021 and 2020, was $6.8 million, $6.4 million and $5.5 million, respectively. As of December 31, 2022, and 2021, there was approximately $14.6 million and $17.8 million, respectively, of unrecognized compensation expense related to stock-based awards, which is expected to be recognized through 2027.

During the years ended December 31, 2022, 2021 and 2020, the Company recognized gross excess tax benefits from stock-based compensation of less than $0.1 million, $2.3 million, and $5.2 million, respectively. Excess tax benefits reflect the total realized value of the Company’s tax deductions from individual stock option exercise transactions and the vesting of restricted stock awards in excess of the deferred tax assets that were previously recorded.

The Company previously adopted the 2011 Equity Incentive Plan of Accel Entertainment, Inc., and 2016 Equity Incentive Plan of Accel Entertainment, Inc., (collectively, “Plans”). Under the Plans, the aggregate number of shares of common stock that may be issued or transferred pursuant to options or restricted stock awards under the Plans will not exceed ten percent of the outstanding shares of the Company. Options generally vest over a three to five-year period. The exercise price of stock options shall not be less than 100% of the fair market value per share of common stock on the grant date. The term of the options are a maximum of 10 years from the grant date.

In conjunction with the closing of the reverse recapitalization, the Accel Entertainment, Inc. Long Term Incentive Plan (the “LTIP”) was adopted. The LTIP provides for grants of a variety of awards to employees and non-employees for providing services to the Company, including, but not limited to incentive stock options qualified as such under U.S. federal income tax laws, stock options that do not qualify as incentive stock options, stock appreciation rights, restricted stock awards, restricted stock units, cash incentive awards, and other stock-based awards. The Company has reserved, and in January 2020 registered, a total of 6,000,000 shares of Class A-1 common stock for issuance pursuant to the LTIP, subject to certain adjustments set forth therein. The term of any options to be granted are for a maximum of 10 years from the grant date. The exercise price of stock options shall not be less than 100% of the fair market value per share of common stock on the grant date.

Under the LTIP, the Company granted 315,881 stock options to eligible officers and employees of the Company during the year ended December 31, 2022, which will vest over a period of 4 years. The estimated grant date fair value of these options totaled $2.3 million.

The Company uses the Black-Scholes formula to estimate the fair value of its stock-based payments. The volatility assumption used in the Black-Scholes formula is based on the volatility of comparable public companies. The Company determined the share price at grant date used in the Black-Scholes formula based on an internal valuation model for options granted prior to the Company going public. Upon going public, the Company used the closing market stock price on the date of grant.

The fair value assigned to each option is estimated on the date of grant using a Black-Scholes-based option valuation model. The expected term of each option granted represents the period of time that each option granted is expected to be outstanding. The risk-free rate for periods within the contractual life of the unit is based on U.S. Treasury yields in effect at the time of grant.


Outstanding options	Shares	Weighted Average Grant Date Fair Value		Weighted Average Exercise Price
Outstanding at January 1, 2020	1,228,399	$	0.96	$	2.91
Granted	1,449,779	4.49		11.20
Exercised	(359,987)	0.69		2.33
Forfeited/expired	(68,580)	1.32		3.85
Outstanding at December 31, 2020	2,249,611	3.25		8.32
Granted	262,097	6.90		11.75
Exercised	(577,719)	0.96		2.95
Forfeited/expired	(377,503)	4.08		10.03
Outstanding at December 31, 2021	1,556,486	4.51		10.47
Granted	315,881	7.30		12.09
Exercised	(136,998)	2.20		5.93
Forfeited/expired	(436,960)	4.79		10.97
Outstanding at December 31, 2022	1,298,409	7.25		11.18


Nonvested options	Shares	Weighted Average Grant Date Fair Value
Nonvested at January 1, 2020	1,148,301	$	0.95
Granted	1,449,779	4.49
Vested	(496,464)	0.08
Forfeited	(68,580)	1.32
Nonvested at December 31, 2020	2,033,036	3.49
Granted	262,097	6.90
Vested	(506,299)	1.23
Forfeited	(377,503)	4.08
Nonvested at December 31, 2021	1,411,331	4.77
Granted	315,881	7.30
Vested	(314,462)	4.17
Forfeited	(321,682)	4.86
Nonvested at December 31, 2022	1,091,068	5.65

As of December 31, 2022, and 2021, a total of 207,341 and 145,555 options with a weighted-average remaining contractual term of 4.5 and 3.5 years, respectively, granted to employees were vested. The fair value of options that vested during 2022, 2021 and 2020 was $1.3 million, $0.3 million, and $0.4 million, respectively. As of December 31, 2022, and 2021, the weighted-average exercise price of the non-vested awards was $11.85 and $10.98, respectively. As of December 31, 2022, and 2021, the weighted-average remaining contractual term of the outstanding awards was 7.3 years and 7.5 years, respectively. The total intrinsic value of options that were exercised during the years ended December 31, 2022, 2021 and 2020 was approximately $0.6 million, $5.2 million and $2.2 million, respectively. The aggregate intrinsic value of options outstanding as of December 31, 2022 is $0.4 million.

The Company issued 569,600 RSUs to eligible employees and Directors of the Company during the year ended December 31, 2022, which will vest over a period of 2 to 5 years for employees and a period of 1 year for Directors. The RSUs are valued using the stock price on the grant date and had an estimated grant date fair value of $6.9 million.


Non-vested RSUs	Shares	Weighted Average Grant Date Fair Value
Nonvested at January 1, 2020	—	$	—
Granted	1,665,968	11.16
Vested	(4,960)	10.08
Forfeited	(25,259)	11.66
Nonvested at December 31, 2020	1,635,749	11.15
Granted	558,193	11.96
Vested (1)	(343,579)	10.82
Forfeited	(256,634)	10.87
Nonvested at December 31, 2021	1,593,729	11.55
Granted	569,600	12.16
Vested (2)	(383,088)	11.51
Forfeited	(361,532)	11.03
Nonvested at December 31, 2022	1,418,709	11.94