The Company's compensation expense in 2020 relates to restricted stock and RSUs awarded in 2020, 2019, 2018, and 2017. Restricted stock and the 2020 RSUs are equity-classified awards (settled in shares of the Company) for which compensation expense per share is fixed. The 2019 and 2018 RSUs are liability-classified awards (settled in cash) for which the expense fluctuates from period to period dependent, in part, on the Company's stock price. For 2020, 2019, and 2018, stock-based compensation expense, net of forfeitures, was recorded as follows (in thousands):


	2020		2019		2018
Equity-classified awards:
Restricted stock	$	2,555	$	2,468	$	2,257
Market based RSUs	1,255		—		—
Performance based RSUs	428		—		—
Director grants	1,060		1,362		1,142
Total equity-classified award expense, net of forfeitures	5,298		3,830		3,399

Liability-classified awards
Market based RSUs	2,498		6,306		2,712
Performance based RSUs	258		1,814		963
Time vested RSUs	633		1,040		357
Dividend equivalent units	675		740		532
Total liability-classified award expense, net of forfeitures	4,064		9,900		4,564
Total stock-based compensation expense, net of forfeitures	$	9,362	$	13,730	$	7,963

On April 23, 2019, the Company's stockholders approved the Cousins Properties Incorporated 2019 Omnibus Incentive Stock Plan (the "2019 Plan") which allows the Company to issue awards of stock options, stock grants, or stock appreciation rights to employees and directors. The 2019 Plan also allows the Company to issue awards to employees that are paid in cash or stock on the vesting date in an amount equal to the fair market value, as defined, of one share of the Company’s stock. As of December 31, 2020, 3,577,897 shares were authorized to be awarded pursuant to the 2019 Plan. The Company also maintains the Cousins Properties Incorporated 2009 Incentive Stock Plan (the "2009 Plan") and the Cousins Properties Incorporated 2005 Restricted Stock Unit Plan (the “RSU Plan”), as amended, although no further issuances are permitted under the 2009 Plan or RSU Plan.

During 2020, the Company granted three types of equity-classified awards to key employees: (1) RSUs based on the total stockholder return of the Company, as defined, relative to that of office peers included in the SNL US Office REIT Index (the "Market-based RSUs"), (2) RSUs based on the ratio of cumulative funds from operations per share to targeted cumulative funds from operations per share (the “Performance-based RSUs”), (3) and restricted stock. During 2019 and 2018, the only equity-based awards granted were restricted stock.

The RSU awards are equity-classified awards to be settled in stock with issuance dependent upon the attainment of required service, market, and performance criteria. For the 2020 Market-based RSUs the Company expenses an estimate of the fair value of the awards on the grant date, calculated using a Monte Carlo valuation at grant date, ratably over the vesting period, adjusting only for forfeitures when they occur. The expense of these Market-based RSUs is not adjusted for the number of awards that actually vest. For the 2020 Performance-based RSUs the Company expenses the awards over the vesting period using the grant date fair market value of the Company's stock on the grant date. The expense is recognized ratably over the vesting period and adjusted each quarter based on the number of shares expected to vest and for forfeitures when they occur. The measurement period for both RSUs awarded in 2020 is three years starting on January 1st of the year of issuance and ending on December 31st. The ultimate settlement of these awards can range from 0% to 200% of the targeted number of units depending on the achievement of the market and performance metrics described above.

The Company estimates future expense for all equity-classified RSUs outstanding at December 31, 2020 to be $2.7 million (using estimated vesting percentages for performance-based RSUs as of December 31, 2020), which will be recognized over a weighted-average period of 2.1 years.

In 2020 2019, and 2018, the Company issued 71,421, 65,824, and 78,799 shares, respectively, of restricted stock to employees, which vest ratably over three years from the issuance date. In 2020, 2019, and 2018, the Company also issued 34,059, 37,166, and 29,638 shares, respectively, of stock to independent members of the board of directors which vested immediately on the issuance date. The Company records restricted stock in common stock and additional paid-in capital at fair value on the grant date, with the offsetting deferred compensation also recorded in additional paid-in capital. The Company records compensation expense over the vesting period. As of December 31, 2020, the Company had $2.7 million of unrecognized compensation cost included in additional paid-in capital related to restricted stock, which will be recognized over a weighted average period of 1.5 years. The total vesting-date fair value of the restricted stock which vested during 2020, 2019, and 2018 was $3.2 million, $2.6 million, and $2.3 million, respectively.


	2020		2019		2018
	Shares	Weighted Average Fair Market Value at Grant	Shares	Weighted Average Fair Market Value at Grant	Shares	Weighted Average Fair Market Value at Grant
Shares unvested at beginning of the year	141	$34.81	148	$33.08	139	$31.72
Granted	173	$44.13	66	$35.64	78	$34.04
Vested	(82)	$34.69	(72)	$34.09	(64)	$31.32
Forfeited	(11)	$41.10	(1)	$34.46	(5)	$32.88
Shares unvested at end of year	221	$41.90	141	$34.81	148	$33.08

Dividend equivalents for the 2020 RSUs will be settled in shares of the Company's common stock based upon the number of units vested. The Company accrues for these dividend equivalent units over the measurement period as dividends are declared and they are included in distributions in excess of cumulative net income on the consolidated balance sheet. The targeted number of non-vested equity-classified RSUs at December 31, 2020 is 97,315.

In addition to the equity-classified RSUs and restricted stock, at December 31, 2020, the Company had 28,351 stock options outstanding to key employees and outside directors, which are exercisable for common stock, all of which are fully vested. In 2020, 2019, and 2018, there were no stock option grants to employees or directors, and the Company recognized no compensation expense related to stock options. During 2020 and 2019, the Company issued 12,373 and 10,451 shares for option exercises, respectively. As of December 31, 2020, the intrinsic value of the options outstanding and exercisable was $225,000. The intrinsic value is calculated using the exercise prices of the options compared to the market value of the Company’s stock. At December 31, 2020 and 2019, the weighted-average contractual lives for the options outstanding and exercisable were 0.1 years and 0.6 years, respectively.


	2020		2019		2018
	Number of Options	Weighted Average Exercise Price Per Option	Number of Options	Weighted Average Exercise Price Per Option	Number of Options	Weighted Average Exercise Price Per Option
Outstanding at beginning of year	67	$23.13	114	$24.00	232	$26.36
Exercised	(37)	$21.28	(42)	$25.59	(114)	$26.40
Forfeited/Expired	(2)	$22.76	(5)	$25.32	(4)	$74.88
Outstanding at end of year	28	$25.55	67	$23.13	114	$24.00

The 2019 and 2018 RSU awards are liability-classified awards to be settled in cash with payment dependent upon the attainment of required market, performance, and service criteria. The vesting period for the Market-based and Performance-based RSUs is three years starting on January 1st of the year of issuance and ending on December 31st. The vesting period for the Service-based RSUs is three years beginning with grant date. For the 2019 and 2018 Market-based RSUs the Company expenses an estimate of the fair value of the awards over the vesting period using a quarterly Monte Carlo valuation. For the 2019 and 2018 Performance-based RSUs the Company expenses the awards over the vesting period using the fair market value of the Company’s stock at the reporting date multiplied by the anticipated number of units to be paid based on the current estimate of what the ratio is expected to be upon vesting. For the 2019 and 2018 Service-based RSUs expenses the awards ratably over the vesting period using the fair market value of the Company's stock at the reporting date.

Dividend equivalents on the 2019 and 2018 Market-based RSUs and Performance-based RSUs will be paid based upon the percentage vested. The Company accrues for and expenses these dividend equivalent units over the measurement period as dividends are declared, based on the latest projected vesting percentage. The targeted number of non-vested Market-based and Performance-based RSUs at December 31, 2020 are 87,645 related to the 2019 grants.

For Service-based RSUs dividend equivalent units will be paid based on the number of RSUs granted. For the 2018 time-vested RSU grants, these dividend payments have been and will continue to be made concurrently with the payment of common dividends. For the 2019 time-vested RSU grants, dividend equivalent units will be paid out at the time of vesting. The Company accrues, expenses, and/or pays for these dividend equivalent units over the service period as dividends are declared.

The Company estimates future expense for all types of liability-classified RSUs outstanding at December 31, 2020 to be $2.5 million (using stock prices and estimated target percentages as of December 31, 2020), which will be recognized over a weighted-average period of 1.4 years. During 2020, total cash paid for all types of liability-classified RSUs and related dividend payments was $9.9 million.