Stock Based Compensation

6 Months Ended

Jun. 30, 2022

Share-based Payment Arrangement, Noncash Expense [Abstract]

10. STOCK BASED COMPENSATION

Time Vested Restricted Stock Awards (“RSAs”) and Time Vested Restricted Stock Units (“RSUs”)

During the three and six months ended June 30, 2022, the Company issued the following RSAs and RSUs pursuant to the Cambridge Bancorp 2017 Equity and Cash Incentive Plan (the “2017 Plan”). RSAs time-vest either over a three-year or five-year period. RSUs vest over a three-year-period. The fair value of RSAs and RSUs are based upon the closing price of the Company's common stock on the date of the applicable grant. The holders of RSAs participate fully in the rewards of stock ownership of the Company, including voting and dividend rights. The holders of RSUs do not participate in the rewards of stock ownership of the Company until vested.


Three Months Ended June 30, 2022
		Weighted-Average
Shares Granted		Fair Value at Grant Date		Type of Award
	1,169	$	78.53	RSAs


Six Months ended June 30, 2022
		Weighted-Average
Shares Granted		Fair Value at Grant Date		Type of Award
	12,934	$	87.31	RSAs
	8,796	$	88.18	RSUs

Performance-Based Restricted Stock Units (“PRSUs”)

There were no PRSUs granted during the three months ended June 30, 2022. During the six months ended June 30, 2022, the Company granted 30,895 PRSUs from the 2017 Plan, as shown in the table below. PRSUs are subject to a three-year performance period and are earned based on two factors: (i) operating return on assets and (ii) operating diluted earnings per share growth as compared to the Company’s established peer indices as defined in the Company’s 2022 Proxy Statement filed with the SEC on March 16, 2022.


Six Months ended June 30, 2022
		Weighted-Average
Shares Granted		Fair Value at Grant Date		Type of Award
	30,895	$	88.18	PRSUs

The following table presents the pre-tax expense associated with all outstanding non-vested RSAs, RSUs, and PRSUs, and the related tax benefits recognized:


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
	(dollars in thousands)
Share based compensation expense	$	943	$	1,138	$	1,591	$	2,513
Related tax benefits	$	263	$	318	$	444	$	702

Share-based activity in the statement of changes in shareholders’ equity includes RSA, RSU, and PRSU expense, as well as expense related to the Company’s share-based compensation for directors and shares repurchased by the Company for shares tendered by employees to cover income tax liability as grants vest.

The 2017 Plan allows Directors of the Company to receive their annual retainer fee in the form of stock in the Company. The total shares issued under the 2017 Plan for the three months ended June 30, 2022 and June 30, 2021 were 6,617 and 5,941, respectively. The total shares issued under the 2017 Plan for the six months ended June 30, 2022 and June 30, 2021 were 6,776 and 5,941, respectively.