Share-Based Compensation Plan

6 Months Ended

Jun. 30, 2014

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

Share-Based Compensation Plan

Share-Based Compensation Plan

The Company sponsors one share-based compensation plan, the 2006 Equity Compensation Plan, which provides for the granting of stock options, stock appreciation rights, stock awards, performance share awards, incentive awards, and stock units.  The 2006 Equity Compensation Plan was approved by the Company’s shareholders at the Annual Meeting held on April 26, 2006, and has succeeded the Company’s 1997 Stock Incentive Plan.  Under the plan, the Company may grant share-based compensation to its directors, officers, employees, and other persons the Company determines have contributed to the profits or growth of the Company.  During 2013, the Company's Board of Directors and shareholders approved an amendment to this Plan to increase the number of shares reserved for issuance from 255,000 shares to 430,000 shares, an increase of 175,000 shares.

For the six months ended June 30, 2014, the Company recorded $213,000 in share-based compensation expense related to restricted stock. As of June 30, 2014 all outstanding option awards were previously vested and, accordingly, there was no compensation expense recognized as of June 30, 2014.  

The aggregate intrinsic value, noted in the tables below, represents the amount by which the current market value of the underlying stock exceeds the exercise price. This amount changes based on changes in the market value of the Company’s common stock.

The Company granted 35,000 shares of restricted stock on May 7, 2014 to certain employees and executive officers. The restricted stock awards are performance based awards that contain performance based acceleration provisions if certain financial performance targets are met during pre-defined monitoring periods. Under the terms of the award, vesting may be accelerated on a partial basis depending on financial results for the years 2014 - 2018 based on the percentile ranking of the Company compared to its peer group over the period 2014 - 2018. All unearned restricted stock awards are forfeited if the employee leaves the Company prior to vesting. On January 27, 2014 and May 7, 2014 the Company awarded 133 shares and 4,400 shares, respectively, of restricted stock to members of the board of directors. These shares will vest at 100% on April 30, 2014 and April 30, 2015, respectively.

The following table summarizes restricted stock service and performance awards awarded under the 2006 Equity Compensation Plan:

	June 30, 2014
	Shares		Weighted-Average Grant Date Fair Value		Aggregate Intrinsic Value (in thousands)
Non-vested at December 31, 2013	119,250		$	16.39
Granted	39,533		17.63
Vested	(15,258	)	15.55
Forfeited	(11,250	)	16.05
Non-vested at June 30, 2014	132,275		$	16.64	$	2,646

The weighted-average remaining contractual term for non-vested service award grants at June 30, 2014, was 4.03 years.  As of June 30, 2014, there was $1.6 million of total unrecognized compensation expense related to the non-vested service award grants under the 2006 Equity Compensation Plan.

The following table summarizes options outstanding under the 2006 Equity Compensation Plan and remaining outstanding unexercised options under the 1997 Stock Incentive Plan.  

	June 30, 2014
	Shares		Weighted-Average Exercise Price		Aggregate Intrinsic Value (in thousands)
Outstanding at December 31, 2013	58,513		$	15.30	$	160
Granted	—		—		—
Exercised	(9,563	)	14.00		40
Forfeited	(3,000	)	39.40		—
Outstanding at June 30, 2014	45,950		$	14.00	$	276
Options exercisable at June 30, 2014	45,950		$	14.00	$	276

As of June 30, 2014, options outstanding and exercisable are summarized as follows:

Exercise Prices		Options Outstanding	Weighted-Average Remaining Contractual Life (years)	Options Exercisable
$	14.00	40,950	4.71	40,950
$	14.00	5,000	5.34	5,000
$	14.00	45,950	4.78	45,950