SHAREHOLDERS' EQUITY

3 Months Ended

Mar. 31, 2017

SHAREHOLDERS' EQUITY [Abstract]

SHAREHOLDERS' EQUITY

10. SHAREHOLDERS’ EQUITY

Common Stock Repurchases

In November 2016, our Board of Directors authorized a program to repurchase shares of common stock of FNHC, at such times and at prices as management determines advisable, up to an aggregate of $10.0 million through March 1, 2017. In March 2017, our Board of Directors authorized an additional $10.0 million share buyback program to repurchase shares of common stock through March 31, 2018. This program may be modified, suspended or terminated by us at any time without notice. Common stock repurchases are conducted in the open market or under Rule 10b5-1 trading plans from time to time in its discretion, based on ongoing assessments of the Company’s capital needs, the market price of its common stock and general market conditions. The amount and timing of all repurchase transactions are contingent upon market conditions, applicable legal requirements and other factors.

Pursuant to our Board of Directors’ authorizations, the Company repurchased 103,485 shares of its common stock at a total cost of $1.9 million, which is a weighted average price per share of $18.18, during the three months ended March 31, 2017.  As of March 31, 2017, the remaining availability for future repurchases of our common stock was $9.5 million.

Subsequent Event

As of this date, the Company has repurchased an additional 292,961 shares of its common stock at a total cost of $4.7 million, which is a weighted average price per share of $16.07. The remaining availability for future repurchases of our common stock is $4.8 million.

Share-Based Compensation Expense

The following table provides certain information in connection with the Company’s share-based compensation arrangements for the three months ended March 31, 2017 and 2016, respectively:

	Three Months Ended
	March 31,
	2017		2016
	(in thousands)
Restricted stock	$	667	$	680
Stock options		—		—
Total share-based compensation expense	$	667	$	680
Intrinsic value of options exercised	$	65	$	193
Fair value of restricted stock vested	$	13,499	$	12,358

The intrinsic value of options exercised represents the difference between the stock option exercise price and the weighted average closing stock price of FNHC common stock on the exercise dates, as reported on the NASDAQ Global Market.

Stock Option Awards

A summary of the Company’s stock option activity for the period from January 1, 2017 to March 31, 2017 is as follows:

	Number of Shares	Weighted Average Option Exercise Price
Outstanding at January 1, 2017	79,484	$	3.70
Granted	—	$	—
Exercised	(400)	$	3.59
Cancelled	—	$	—
Outstanding at March 31, 2017	79,084	$	3.70

Restricted Stock Awards

The Company recognizes share-based compensation expense for all restricted stock awards (“RSAs”) held by employees. The accounting charge is measured at the grant date as the fair value of FNHC common stock and expensed as non-cash compensation over the vesting term using the straight-line basis for service awards and the accelerated basis for performance‑based awards with graded vesting.  Certain cliff vesting awards contain performance criteria which are tied to the achievement of certain market conditions. This value is recognized as expense over the service period using the straight‑line recognition method.

During the first quarter of 2017 and 2016, the Board of Directors granted 96,454 and 128,472 RSAs, respectively, vesting over three or five years, to the Company’s directors, executives and other key employees.

The following table summarizes RSA activity during the three months ended March 31, 2017:

	Number of Shares	Weighted Average Grant Date Fair Value
Outstanding at January 1, 2017	337,203	$	19.69
Granted	96,454	$	18.24
Vested	(71,095)	$	18.99
Cancelled	(1,570)	$	20.75
Outstanding at March 31, 2017	360,992	$	19.43

The weighted average grant date fair value is measured using the closing price of FNHC common stock on the grant date, as reported on the NASDAQ Global Market.

Accumulated Other Comprehensive Income

The following table presents a reconciliation of the changes in accumulated other comprehensive income during the three months ended March 31, 2017 and 2016:

	Three Months Ended March 31,
	2017						2016
	Before Tax		Income Tax		Net		Before Tax		Income Tax		Net
	(in thousands)
Accumulated other comprehensive income,
beginning  of period	$	3,323	$	(1,199)	$	2,124	$	6,111	$	(2,247)	$	3,864
Other comprehensive income before reclassifications		3,540		(1,380)		2,160		5,570		(2,103)		3,467
Reclassification adjustment for realized losses (gains) included
in net income		170		(65)		105		(1,486)		559		(927)
		3,710		(1,445)		2,265		4,084		(1,544)		2,540
Accumulated other comprehensive income, end of period	$	7,033	$	(2,644)	$	4,389	$	10,195	$	(3,791)	$	6,404