Note 19 - Equity Incentive Plans

12 Months Ended

Dec. 31, 2018

Notes to Financial Statements

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

19. Equity Incentive Plans

In

May 2015,

the stockholders of the Company approved, the amended, and restated

2005

Incentive Plan, which provides that

3,562,168

shares of the Company’s common stock

may

be granted as incentive or non-statutory stock options, or as restricted stock, or as restricted stock units. As of

December 31, 2018,

the only options granted by the Company under the

2005

Incentive Plan, as amended and restated, were non-statutory stock options to selected bank officers and non-employee directors at exercise prices equal to the fair market value of a share of the Company’s common stock on the date of grant. Such options have a maximum

ten

-year term and vest in

20%

annual increments (subject to early termination in certain events). If such options expire or terminate without having been exercised, any shares

not

purchased will again be available for future grants or awards. There were

no

options granted during the

three

years ended

2018.

The Company expects to issue new shares to satisfy stock option exercises and the vesting of restricted stock units.

Cash received from exercises of stock options totaled

$838,000

for

35,880

shares in

2018,

$1.1

million for

46,790

shares in

2017,

and

$7.7

million for

327,830

shares in

2016.

Aggregate intrinsic value for options exercised was

$718,000

in

2018

compared to

$663,000

in

2017.

A summary of stock option activity for

2018,

2017,

and

2016

follows:

						Weighted-Average Remaining		Aggregate
				Weighted-Average		Contractual		Intrinsic
	Shares			Exercise Price		Life (in years)		Value (in thousands)
Balance, December 31, 2015		1,031,170			31.27		0.9	$	3,268
Exercised		(327,830	)	$	23.37
Forfeited		(620,670	)		36.50
Balance, December 31, 2016		82,670			23.37		1.1	$	1,211
Exercised		(46,790	)	$	23.37
Balance, December 31, 2017		35,880			23.37		0.1	$	675
Exercised		(35,880	)	$	23.37
Balance, December 31, 2018		-			-		0.0	$	-

At

December 31, 2018,

2,621,737

shares were available under the

2005

Incentive Plan for future grants.

In addition to stock options, the Company also grants restricted stock units (“RSUs”) to eligible employees which vest subject to continued employment at the vesting dates. or the attainment of specified performance goals.

RSUs are granted under the Company’s long-term incentive plan at

no

cost to the recipient. RSUs generally vest ratably over

three

years or cliff vest after

one

or

three

years of continued employment from the date of the grant. While a portion of RSUs are time-vesting awards, others vest subject to the attainment of specified performance goals and are referred to as “performance-based RSUs.” All RSUs are subject to forfeiture until vested.

Performance-based RSUs are granted at the target amount of awards. Based on the Company’s attainment of specified performance goals and consideration of market conditions, the number of shares that vest can be adjusted to a minimum of

zero

and to a maximum of

150%

of the target. The amount of performance-based RSUs that are eligible to vest is determined at the end of each performance period and is then added together to determine the total number of performance shares that are eligible to vest. Performance-based RSUs generally cliff vest

three

years from the date of grant.   

The following table presents RSU activity for

2018,

2017,

and

2016:

	Time-Based RSUs					Performance-Based RSUs
				Weighted-Average					Weighted-Average
				Grant Date					Grant Date
	Shares			Fair Value		Shares			Fair Value
Balance at December 31, 2015		85,111			27.55		457,264			26.84
Granted		88,693			30.37		117,679			37.22
Vested		(13,780	)		29.80		-			-
Forfeited		(7,548	)		29.49		-			-
Balance at December 31, 2016		152,476			28.89		574,943			28.96
Granted		87,781			38.59		159,264			40.36
Vested		(1,167	)		38.03		(394,335	)		39.96
Forfeited		(17,352	)		33.10		-			-
Balance at December 31, 2017		221,738			32.72		339,872			33.52
Granted		141,810			43.30		55,455			39.46
Vested		(65,721	)		41.59		(121,336	)		37.87
Forfeited		(13,334	)		35.96		(8,332	)		29.61
Balance at December 31, 2018		284,493			35.79		265,659			32.90

All awards are deemed probable of issuance and the compensation expense recorded for restricted stock units was

$7.3

million in

2018,

$5.2

million in

2017,

and

$4.4

million in

2016.

Unrecognized stock-based compensation expense related to restricted stock units was

$9.8

million at

December 31, 2018

and is expected to be recognized over the next

1.7

years.

The Company adopted ASU

2016

-

09

in

2017

where all excess tax benefits and tax deficiencies from share based payments are recognized as income tax expense or benefit in the income statement instead of the previous accounting which credited excess tax benefits to additional paid-in capital and tax deficiencies as a charge to income tax expense or as an offset to accumulated excess tax benefits, if any.