STOCK-BASED COMPENSATION

6 Months Ended

Jun. 30, 2015

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION

In May 2014, Monarch stockholders ratified the adoption of the Monarch Bank 2014 Equity Incentive Plan ("2014EIP"), a stock-based compensation plan which succeeds the Monarch Bank 2006 Equity Incentive Plan (“2006EIP”). The 2006EIP had succeeded the Monarch Bank 1999 Incentive Stock Option Plan ("1999ISO") and was the only plan under which equity-based compensation could be awarded. Like the 2006EIP, the 2014EIP authorizes the compensation committee to grant options, stock appreciation rights, stock awards, performance stock awards, and stock units to designated directors, officers, key employees, consultants and advisers to the Company and its subsidiaries.

The 2014EIP authorized the Company to issue up to 1,000,000 shares of Monarch Common Stock plus the number of shares of our Common Stock outstanding under the predecessor plans. The Plan also provides that no award may be granted more than 10 years after the May 2014 ratification date.

As of June 30, 2015, 1,132,959 shares were available for grants under all plans. A total of 418,137 shares are subject to outstanding awards under the 2006EIP and 1999ISO, including 31,087 stock options and 387,050 shares of non-vested restricted stock. The stock options outstanding as of June 30, 2015 have a weighted average exercise price of $7.84 and a weighted average remaining term of 3 months and are fully vested. Restricted stock typically vests over a 60 month period. Total compensation costs are recognized over the service period to vesting.

No additional options were granted in the periods covered. There were 55,755 and 73,027 options exercised in the second quarter and first half of 2015. No options on shares were forfeited in the second quarter and first half of 2015.

Compensation expense related to our restricted stock totaled $192,060 and $343,922 in the second quarter and first half of 2015. Remaining vesting periods are between 6 and 54 months with unrecognized remaining compensation expense of $1,976,807. We issued 0 and 72,800 shares of restricted stock in the second quarter and first half of 2015. Shares vested were 1,200 and 2,400 for the second quarter and first half of 2015. Shares forfeited were 6,700 and 11,100 for the second quarter and first half of 2015.