Stock plans

12 Months Ended

Dec. 31, 2023

Stock plans

Stock plans

14. Stock plans:

In May 2017, the Company’s stockholders approved the 2017 equity incentive plan (“2017 Plan”). In May 2023, the Company’s stockholders approved the 2023 equity incentive plan (“2023 Plan”). Under the 2017 Plan and 2023 Plan, the Compensation Committee of the Board of Directors has the authority to, among other things:

● Select the persons to be granted awards under the Plan.

● Determine the type, size and term of awards.

● Determine whether such performance objectives and conditions have been met.

● Accelerate the vesting or exercisability of an award.

Persons eligible to receive awards under the 2017 Plan and 2023 Plan include directors, officers, employees, consultants and other service providers of the Company and its subsidiaries.

As of December 31, 2023, 98,403 shares of the Company’s common stock were available for grant as awards pursuant to the 2023 Plan. While the 2017 Plan will remain in effect in accordance with its terms to govern outstanding awards under that plan, the Company intends to make future grants under the 2023 Plan. If any outstanding 2017 Plan awards are forfeited by the holder or canceled by the Company, the underlying shares would be available for re-grant to others under the 2023 Plan.

The 2017 Plan and 2023 Plan authorize grants of stock options, stock appreciation rights, cash awards, performance awards, restricted stock and restricted stock units.

In 2023, the Company awarded 5,206 shares of non-performance-based restricted stock and 18,222 performance-based restricted stock units under the 2023 Plan. In 2022, the Company awarded 4,397 shares of non-performance-based restricted stock and 15,390 performance-based restricted stock units under the 2017 Plan.

In 2023, 4,139 shares of non-performance-based and 12,652 shares of performance based restricted stock granted under the 2017 Plan vested and 12,524 of these shares were surrendered under the provisions of the 2017 Plan. In 2022, 3,846 shares of non-performance-based and 12,557 shares of performance based restricted stock granted under the 2017 Plan vested and there were 195 shares forfeited under the provisions of the 2017 Plan.

The non-performance-based restricted stock grants made in 2023, 2022 and 2021 vest equally over three years from the grant date. The performance-based restricted stock units vest three years after the grant date and include conditions based on the Company’s three year cumulative diluted earnings per share and three-year average return on equity or tangible equity that determines the number of restricted stock units that may vest.

The activity related to the 2017 and 2023 Plan for each of the years ended December 31, 2023, 2022 and 2021 was as follows:

(Dollars in thousands)	2023	2022	2021
Nonvested, January 1	39,470	36,281	31,923
Granted shares	23,428	19,787	19,818
Vested shares	16,791	16,403	15,460
(Surrendered) Forfeited shares	(12,524)	195
Nonvested, December 31	58,631	39,470	36,281

The Company expenses the fair value of all-share based compensation over the requisite service period commencing at grant date. The fair value of restricted stock is expensed on a straight-line basis. Compensation is recognized over the vesting period and adjusted based on the performance criteria. The Company classifies share-based compensation for employees within “salaries and employee benefits expense” on the Consolidated Statements of Income and Comprehensive Income.

The Company recognized expense for awards granted under the 2017 and 2023 plan of $0.9 million in 2023, $0.5 million in 2022 and $0.5 million in 2021. As of December 31, 2023, the Company had $1.2 million of unrecognized compensation expense associated with restricted stock awards. The remaining cost is expected to be recognized over a weighted average vesting period of 1.7 years.