Stock Compensation for ROIC

9 Months Ended

Sep. 30, 2024

Share-Based Payment Arrangement [Abstract]

ROIC follows the FASB guidance related to stock compensation which establishes financial accounting and reporting standards for stock-based employee compensation plans, including all arrangements by which employees receive shares of stock or other equity instruments of the employer, or the employer incurs liabilities to employees in amounts based on the price of the employer’s stock. The guidance also defines a fair value-based method of accounting for an employee stock option or similar equity instrument.

On April 25, 2022, the Company adopted the Company’s Second Amended and Restated 2009 Equity Incentive Plan (the “Equity Incentive Plan”) that amended and restated the Amended and Restated 2009 Equity Incentive Plan (the “Prior Plan”). The types of awards that may be granted under the Equity Incentive Plan include stock options, restricted shares, share appreciation rights, phantom shares, dividend equivalent rights and other equity-based awards. The Equity Incentive Plan has a fungible unit system that counts the number of shares of the Company’s common stock used in the issuance of full-value awards, such as restricted shares and LTIP Units, differently than the number of shares of common stock used in the issuance of stock options. A total of 10,954,694 Fungible Units (as defined in the Equity Incentive Plan) are reserved for grant under the Equity Incentive Plan. The 10,954,694 Fungible Units represent a maximum of 5,002,143 shares of the Company’s common stock that could be granted pursuant to the Equity Incentive Plan as full-value awards, such as restricted shares, based on the 2.19 to 1.0 Fungible Unit-to-full-value award conversion ratio. A maximum of 10,954,694 shares of the Company’s common stock may be issued pursuant to the Equity Incentive Plan if all grants made under the Equity Incentive Plan are granted as stock options, based on a 1.0 to 1.0 Fungible Unit-to-stock option award conversion ratio. The Equity Incentive Plan will expire on April 25, 2032.

The Company has made, under both the Equity Incentive Plan and the Prior Plan, certain awards in the form of a separate series of units of limited partnership interests in its Operating Partnership called LTIP Units. LTIP Units can be granted either as free-standing awards or in tandem with other awards under the Equity Incentive Plan. The LTIP Units are subject to such conditions and restrictions as the compensation committee may determine, including continued employment or service, achievement of pre-established operational performance goals and market-indexed performance criteria. Upon the occurrence of specified events and subject to the satisfaction of applicable vesting conditions, LTIP Units (after conversion into OP Units, in accordance with the Partnership Agreement) are ultimately redeemable for cash or at ROIC’s option, for shares of ROIC common stock on a one-for-one basis.

Restricted Stock

During the nine months ended September 30, 2024, ROIC awarded 608,781 shares of time-based restricted common stock under the Equity Incentive Plan.

A summary of the status of the Company’s non-vested restricted stock awards as of September 30, 2024, and changes during the nine months ended September 30, 2024 are presented below:


	Shares	Weighted Average Grant Date Fair Value
Non-vested as of December 31, 2023	1,137,965	$	16.74
Vested	(684,840)	$	16.07
Granted	608,781	$	13.06
Forfeited	(8,500)	$	13.96
Non-vested as of September 30, 2024	1,053,406	$	15.07

LTIP Units

During the nine months ended September 30, 2024, ROIC awarded 290,522 LTIP Units under the Equity Incentive Plan. The LTIP Units vest based on both pre-defined operational and market-indexed performance criteria with a vesting date on January 1, 2027.

A summary of the status of the Company’s non-vested LTIP Unit awards as of September 30, 2024, and changes during the nine months ended September 30, 2024 are presented below:


	Shares	Weighted Average Grant Date Fair Value
Non-vested as of December 31, 2023	245,972	$	14.97

Granted	290,522	$	13.23

Non-vested as of September 30, 2024	536,494	$	14.03

Stock Based Compensation Expense

For the three months ended September 30, 2024 and 2023, the amounts charged to expense for all stock-based compensation arrangements totaled approximately $3.5 million and $3.2 million, respectively. For both the nine months ended September 30, 2024 and 2023, the amounts charged to expense for all stock-based compensation arrangements totaled approximately $9.6 million.