Share-Based Compensation

3 Months Ended

Mar. 31, 2020

Share-based Payment Arrangement [Abstract]

SHARE-BASED COMPENSATION

The Company's shareholders approved the 2018 Omnibus Equity Incentive Plan (the "Plan"), which authorizes the granting of incentive stock options, supplemental stock options, stock appreciation rights, restricted stock, restricted stock units (“RSUs”), other stock-based awards and cash-based awards to officers, employees and non-employee directors of, and consultants and advisors to, the Company and its subsidiaries. The Company previously granted such awards under the 2009 Equity Compensation Program; however, no further awards may be granted from the 2009 program.

Restricted Stock

The following is a summary of the Company’s restricted stock activity during the three months ended March 31, 2020:



	Number of Shares		Weighted Average Price
Outstanding, January 1, 2020	13,110		$	15.93
Granted	13,041		16.87
Vested	(13,052	)	15.96
Outstanding, March 31, 2020	13,099		$	16.83

In the first three months of 2020, the Company granted 13,041 shares of restricted stock to non-employee directors at a grant date fair value of $16.87 per share under the 2018 Omnibus Equity Incentive Program. The restricted stock vests one year from the date it was granted. Compensation expense on this restricted stock is expected to be $220,000 over a one year period. In the first three months of 2019, the Company granted 13,052 shares of restricted stock to non-employee directors at a grant date fair value of $15.96 per share. The restricted stock vested one year from the date it was granted with a compensation expense of $208,000 over such period.

The Company recognized share-based compensation expense on its restricted stock of $54,000 and $55,000 for the three months ended March 31, 2020 and 2019, respectively. As of March 31, 2020, there was unrecognized compensation cost of $166,000 related to unvested restricted stock that is expected to be recognized over a weighted average period of approximately 0.79 years.

Restricted Stock Units

The following is a summary of the Company’s RSU activity during the three months ended March 31, 2020:



	Number of Shares		Weighted Average Price
Outstanding, January 1, 2020	300,629		$	18.13
Granted	169,169		15.56
Vested	(84,082	)	18.74
Forfeited	(5,416	)	18.45
Outstanding, March 31, 2020	380,300		$	16.85

In the first three months of 2020, the Company granted 169,169 RSUs under the 2018 Omnibus Equity Incentive Plan at a weighted average grant date fair value of $15.56 per share. These units vest within a range of two years to three years. A portion of these RSUs will vest subject to certain performance conditions in the restricted stock unit agreement. There are also certain provisions in the compensation program which state that if a recipient of the RSUs reaches a certain age and years of service, the person has effectively earned a portion of the RSUs at that time. Compensation expense on the restricted stock units issued in the first three months of 2020 is expected to average approximately $877,000 per year over a three year period. In the first three months of 2019, the Company granted 127,559 RSUs under the Company’s 2018 Omnibus Equity Incentive Plan at a weighted average grant date fair value of $16.66 per share. Compensation expense on these RSUs is expected to average approximately $708,000 per year over a three year period.

The Company recognized share based compensation expense of $794,000 and $640,000 on RSUs for the three months ended March 31, 2020 and 2019, respectively. Unrecognized compensation expense related to RSUs was approximately $4.1 million as of March 31, 2020, and that cost is expected to be recognized over a period of 1.88 years.

Stock Options

A summary of the activity under the Company’s stock option plans as of March 31, 2020 is as follows:



	Number of Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (in years)	Aggregate Intrinsic Value
Outstanding, January 1, 2019	31,706	$	7.76	0.58	$	305,120
Granted	—	—
Exercised	—	—
Outstanding, March 31, 2020	31,706	$	7.76	0.33	$	96,811
Options exercisable at March 31, 2020	31,706	$	7.76	0.33	$	96,811

The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value (the difference between the Company’s closing stock price on the last trading day of the period and the exercise price, multiplied by the number of in-the-money options).

There were no grants of stock options in the first three months of 2020 or 2019. There were no stock options exercised during the first three months of 2020 or 2019. There was no unrecognized compensation expense related to unvested stock options as of March 31, 2020.