In accordance with the Company’s 2013 Incentive Plan, stock awards, including stock options and restricted stock, have been granted to certain employees and non-employee directors. Shares of common stock available for distribution to satisfy the grants may consist, in whole or in part, of authorized and unissued shares, treasury shares or shares reacquired by the Company in any manner. Stock-based compensation expense related to stock awards totaled $0.2 million for both of the nine-month periods ended September 30, 2019 and 2018.

Stock option awards have been granted with an exercise price equal to the market price of the Company’s common stock on the date of the grant and have vesting periods ranging from one to three years, with 10-year contractual terms.

The Company recognizes the cost of services received in exchange for stock option awards based on the grant date fair value of the award, with compensation expense recognized on a straight-line basis over the award’s vesting period. The fair value of outstanding awards was determined using the Black-Scholes option pricing model based on the assumptions noted in the table below. Expected volatilities are based on historical volatilities of the Company’s common stock.

	2019			2018
Risk-free interest rate		2.59	%		2.77	%
Expected term (in years)		7.5			7.5
Expected stock price volatility		30.9	%		28.3	%
Dividend yield		1.25	%		1.50	%
Fair value of stock option		3.30			3.51

The following table summarizes the Company’s stock option activity for the periods presented.

	Nine Months Ended
	September 30, 2019				September 30, 2018
	Number of Shares		Average Exercise Price		Number of Shares		Average Exercise Price
Options:
Outstanding, beginning of period		377,950	$	9.80		318,000	$	9.43
Granted		68,150		9.99		62,150		11.71
Exercised		719		8.30		500		8.12
Expired		—		—		—		—
Forfeited		26,300		11.96		1,700		11.15
Options outstanding, end of period		419,081	$	9.70		377,950	$	9.80
Options exercisable, end of period		304,748	$	9.14		249,467	$	8.72

The aggregate intrinsic value of stock options outstanding (calculated as the amount by which the market value of underlying stock exceeds the exercise price of the option) was approximately $0.2 million and $0.7 million as of September 30, 2019 and 2018, respectively.

During the nine months ended September 30, 2019 and 2018, respectively, 5,520 shares and 10,520 shares of restricted stock were granted. The Company recognizes the cost of services received in exchange for restricted stock awards based on the grant date closing price of the stock, with compensation expense recognized on a straight-line basis over the award’s vesting period.