Equity Compensation

6 Months Ended

Jun. 30, 2016

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Equity Compensation

14.) Equity Compensation:

During 2015, the Company, created the 2015 Omnibus Equity Plan and The Director Equity Plan.

The Omnibus Equity Plan permits the award of up to 340,000 shares to the Company’s employees to promote the long-term financial success of the Company, increasing stockholder value by providing employees the opportunity to acquire an ownership interest in the Company and enabling the Company and its related entities to attract and retain the services of those upon whom the successful conduct of business depends. There were 13,683 restricted board approved shares granted under the plan in April 2016. The Company is expensing the grant date fair value of all share-based compensation over the requisite vesting periods on a prorated straight-line basis.  In 2016, $13,000 was recorded in the Consolidated Statement of Income. As of June 30, 2016, there was $196,000 of total unrecognized compensation expense related to the non-vested shares granted under the Plan. Shares awarded under this plan vest in equal thirds on the first three anniversaries of the award date if the employee remains employed with Cortland Bancorp. The remaining cost is expected to be recognized over 2.8 years, which is the remainder of the three-year tiered vesting period. There were no shares granted under the plan in 2015.

Granted shares are awarded upon meeting achievement of performance objectives derived from one or more of the performance criteria. The main metrics used include net earnings, earnings per share, return on average assets and equity, share price and other earnings ratios.

The Director Equity Plan permits the award of up to 113,000 shares to nonemployee directors to promote the long-term financial success of the Company, increasing stockholder value by enabling the Company and its related entities to attract and retain the services of those directors upon whom the successful conduct of business depends.  There were 1,789 board approved shares granted under the plan in April 2016 with immediate vesting.  In 2016, $27,000 was recorded in the Consolidated Statement of Income.  

The following is the activity under the two plans during the six months ended June 30, 2016:

	Restricted Stock Units
	Units		Price at Grant Date
Nonvested at January 1, 2016		—	$	—
Granted		15,472		15.25
Vested		1,789		15.25
Forfeited		—		—
Nonvested at June 30, 2016		13,683	$	15.25