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SHARE BASED COMPENSATION

6 Months Ended

Jun. 30, 2020

Note 10 – Share Based Compensation

At June 30, 2020, the Company had two share based compensation plans in existence, the 2005 Omnibus Stock Plan (“Omnibus Stock Plan”) and the 2015 Omnibus Incentive Plan (“Omnibus Incentive Plan”). The Omnibus Stock Plan expired during the second quarter of 2015 but has outstanding options that may still be exercised. The Omnibus Incentive Plan is described in the following paragraph.

The Company’s Omnibus Incentive Plan was approved on May 6, 2015 and provides for the granting of incentive stock options, non-qualifying stock options, stock appreciation rights, restricted stock grants, restricted stock units and performance share units to selected directors and employees on a periodic basis at the discretion of the Company’s Board of Directors. The Omnibus Incentive Plan authorizes the issuance of up to 1,500,000 shares of common stock, of which 906,405 are available for issuance at June 30, 2020, has a term of ten years, and is administered by a committee of at least three directors appointed by the board of directors. Options granted under the plan have an exercise price which may not be less than 100% of the fair market value of the common stock on the date of the grant and must be exercised within seven to ten years from the date of grant. The exercise price of stock options must be paid for in full in cash or shares of common stock, or a combination of both. The board committee has the discretion when making a grant of stock options to impose restrictions on the shares to be purchased upon the exercise of such options. The Company generally issues authorized but previously unissued shares to satisfy option exercises.

The dividend yield is based on estimated future dividend yields. The risk-free rate for periods within the contractual term of the share option is based on the U.S. Treasury yield curve in effect at the time of the grant. Expected volatilities are generally based on historical volatilities. The expected term of share options granted is generally derived from historical experience.

Compensation expense is recognized on a straight-line basis over the vesting period of the respective stock option, restricted stock, restricted stock unit grant or performance share units. The Company recognized compensation expense of $1.0 million and $0.7 million for the three months ended June 30, 2020 and 2019, respectively, and of $1.8 million and $1.4 million, for the six months ended June 30, 2020 and 2019, respectively, related to the awards of stock options, restricted stock grants, restricted stock unit grants and performance share unit grants. The total of unrecognized compensation cost related to stock options was not significant as of June 30, 2020, and is expected to be recognized within one year. The fair value of the options vested during the six months ended June 30, 2020 and 2019, was $0.1 million and $0.2 million, respectively. The total of unrecognized compensation cost related to restricted stock was approximately $10.2 million as of June 30, 2020. That cost is expected to be recognized over a weighted average period of approximately 3.0 years.

The Company granted a total of 64,829 restricted shares, restricted stock units and performance share units during the three months ended June 30, 2020, of which 4,694 units are subject to achievement of certain performance conditions measured over a three year performance period and 60,135 shares or units subject to a three- or five-year vesting schedule. During the six months ended June 30, 2020, the Company granted 246,015 restricted shares, restricted stock units and performance share units, of which 44,905 units are subject to achievement of certain performance conditions measured over a three year performance period and 201,110 shares or units subject to a three- or five-year vesting schedule. The Company did not grant any stock options during the six months ended June 30, 2020, however, the Company issued 395,298 stock options at a weighted average grant-date fair value of $9.14, due to a conversion of stock options held prior to the Acquisition Date by Revere employees. The fair value of the options issued were considered part of the consideration transferred and were therefore recorded as an adjustment to goodwill. See Note 2 for more information on the acquisition of Revere.

A summary of share option activity for the period indicated is reflected in the following table:

				Weighted
	Number	Weighted		Average	Aggregate
	of	Average		Contractual	Intrinsic
	Common	Exercise		Remaining	Value
	Shares	Share Price		Life (Years)	(in thousands)
Balance at January 1, 2020	65,279	$	31.34		$	485
Granted	-	$	-
Converted options from Revere acquisition	395,298	$	12.27
Exercised	(8,638)	$	17.00		$	104
Forfeited	(573)	$	39.31
Expired	(703)	$	28.26
Balance at June 30, 2020	450,663	$	14.88	3.4	$	4,930

Exercisable at June 30, 2020	445,707	$	14.62	3.4	$	4,930

A summary of the activity for the Company’s restricted stock, restricted stock units and performance share units for the period indicated is presented in the following table:

	Number	Weighted
	of	Average
	Common	Grant-Date
	Shares/Units	Fair Value
Non-vested at January 1, 2020	226,502	$	35.43
Granted	246,015	$	25.82
Vested	(63,840)	$	34.34
Forfeited	(7,461)	$	46.90
Non-vested at June 30, 2020	401,216	$	29.50