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Stock Incentive Plans
 3 Months Ended
Mar. 31, 2012
Stock Incentive Plans [Abstract]  
Stock Incentive Plans

STOCK INCENTIVE PLANS

Restricted Stock

The Corporation issues restricted stock awards, consisting of both restricted stock and restricted stock units, to key employees under its Incentive Compensation Plans (Plans). The grant date fair value of the restricted stock awards is equal to the price of the Corporation's common stock on the grant date. For the three months ended March 31, 2012 and 2011, the Corporation issued 275,674 and 384,372 restricted stock awards with aggregate weighted average grant date fair values of $3,384 and $3,882, respectively, under these Plans. As of March 31, 2012, the Corporation had available up to 3,261,350 shares of common stock to issue under these Plans.

Under the Plans, more than half of the restricted stock awards granted to management are earned if the Corporation meets or exceeds certain financial performance results when compared to its peers. These performance-related awards are expensed ratably from the date that the likelihood of meeting the performance measure is probable through the end of a four-year vesting period. The service-based awards are expensed ratably over a three-year vesting period. The Corporation also issues discretionary service-based awards to certain employees that vest over five years.

The unvested restricted stock awards are eligible to receive cash dividends or dividend equivalents which are ultimately used to purchase additional shares of stock. Any additional shares of stock received as a result of cash dividends are subject to forfeiture if the requisite service period is not completed or the specified performance criteria are not met. These awards are subject to certain accelerated vesting provisions upon retirement, death, disability or in the event of a change of control as defined in the award agreements.

Share-based compensation expense related to restricted stock awards was $575 and $940 for the three months ended March 31, 2012 and 2011, the tax benefit of which was $201 and $329, respectively.

The following table summarizes certain information concerning restricted stock awards:

 

     Three Months Ended March 31,  
     2012      2011  
     Awards     Weighted
Average
Grant
Price		      Awards     Weighted
Average
Grant
Price		  

Unvested awards outstanding at beginning of period

      1,846,115      $ 8.44         1,309,489      $ 8.52   

Granted

      275,674        12.28         384,372        10.10   

Vested

      (165,284 )      8.01         (170,247 )      13.63   

Forfeited

      (126,301 )      8.32         (671 )      7.71   

Dividend reinvestment

      15,474        12.22         13,913        10.04   
  

 

 

       

 

 

    

Unvested awards outstanding at end of period

      1,845,678        9.09         1,536,856        8.37   
  

 

 

       

 

 

    

The total fair value of awards vested was $2,034 and $1,748 for the three months ended March 31, 2012 and 2011, respectively.

As of March 31, 2012, there was $8,056 of unrecognized compensation cost related to unvested restricted stock awards including $101 that is subject to accelerated vesting under the Plan's immediate vesting upon retirement provision for awards granted prior to the adoption of ASC 718, Compensation – Stock Compensation. The components of the restricted stock awards as of March 31, 2012 are as follows:

 

     Service-
Based
Awards		      Performance-
Based
Awards		      Total  

Unvested awards

      489,918         1,355,760         1,845,678   

Unrecognized compensation expense

    $ 2,436       $ 5,620       $ 8,056   

Intrinsic value

    $ 5,918       $ 16,378       $ 22,296   

Weighted average remaining life (in years)

      2.38         2.63         2.56   

Stock Options

The Corporation did not grant stock options during the three months ended March 31, 2012 or 2011. All outstanding stock options were granted at prices equal to the fair market value at the date of the grant, are primarily exercisable within ten years from the date of the grant and are fully vested. The Corporation issues shares of treasury stock or authorized but unissued shares to satisfy stock options exercised. Shares issued upon the exercise of stock options were 36,385 and 8,389 for the three months ended March 31, 2012 and 2011, respectively.

The following table summarizes certain information concerning stock option awards:

 

     Three Months Ended March 31,  
     2012      2011  
     Shares     Weighted
Average
Exercise
Price		      Shares     Weighted
Average
Exercise
Price		  

Options outstanding at beginning of period

      586,020      $ 14.93         770,610      $ 14.28   

Acquired from Parkvale

      627,808        10.41         —          —     

Exercised

      (36,385 )      7.67         (8,389 )      2.68   

Forfeited

      (227,737 )      14.04         (120,207 )      11.65   
  

 

 

       

 

 

    

Options outstanding and exercisable at end of period

      949,706        12.43         642,014        14.93   
  

 

 

       

 

 

    

The intrinsic value of outstanding and exercisable stock options at March 31, 2012 was $(325), since the fair value of the stock subject to the options was less than the exercise price.

Warrants

In conjunction with its participation in the UST's CPP, the Corporation issued to the UST a warrant to purchase up to 1,302,083 shares of the Corporation's common stock. Pursuant to Section 13(H) of the Warrant to Purchase Common Stock, the number of shares of common stock issuable upon exercise of the warrant was reduced in half to 651,042 shares on June 16, 2009, the date the Corporation completed a public offering. The warrant, which expires in 2019, has an exercise price of $11.52 per share.

In connection with the Parkvale acquisition, the warrant issued by Parkvale to the UST under the CPP has been converted into a warrant to purchase up to 819,640 shares of the Corporation's common stock. This warrant, which was recorded at a provisional fair value, expires in 2018 and has an exercise price of $5.81 per share.