Stock and Incentive Compensation Plans

12 Months Ended

Dec. 31, 2021

Share-based Payment Arrangement [Abstract]

Note 13 - Stock and Incentive Compensation Plans

On April 28, 2021, an employee stock purchase plan ("ESPP") was approved by the Company's stockholders and qualified as an ESPP under IRS guidelines. The ESPP provides for the purchase of up to an aggregate one million shares of the Company's common stock by employees pursuant to the terms of the ESPP. Under the ESPP, employees of the Company who elect to participate have the right to purchase a limited number of shares of the Company's common stock at a 15% discount from the lower of the market value of the common stock at the beginning or the end of each one year offering period, beginning on June 1st. The ESPP benefit is treated as compensation to the employee and the compensation expense will be recognized over the service period based on the fair value of the rights on the grant date, adjusted for forfeitures and certain modifications.

There were no shares of common stock issued pursuant to the ESPP during the year ended December 31, 2021.

The Company has granted, and currently has outstanding, stock and incentive compensation awards subject to the provisions of the Company's 2012 Stock Incentive Plan (the "2012 Plan"). Additionally, awards have been issued prior to the establishment of the 2012 Plan, some of which were still outstanding at December 31, 2021. The 2012 Plan is designed to provide flexibility to the Company regarding its ability to motivate, attract and retain the services of key officers, employees and directors. The 2012 Plan allows the Company to make grants of incentive stock options, non-qualified stock options, stock appreciation rights, restricted stock awards ("RSA"), restricted stock units ("RSU"), dividend equivalent rights, performance unit awards or any combination thereof. At December 31, 2021, the maximum number of shares of the Company's common stock available for issuance under the 2012 Plan was 664,668 shares.

Share-based compensation cost charged to income for the years ended December 31, 2021, 2020 and 2019, is presented below. There was no stock option expense for any of the periods shown.


	Years Ended December 31,
(Dollars in thousands)		2021		2020		2019
RSA & RSU		$	2,100	$	2,320	$	2,247
ESPP		195		—		—
Total stock compensation expense		$	2,295	$	2,320	$	2,247
Related tax benefits recognized in net income		$	482	$	487	$	472

Restricted Stock Grants

The Company's restricted stock grants are time-vested awards and are granted to the Company's Board of Directors, executives and senior management team. The service period in which time-vested awards are earned ranges from one to five years. Time-vested awards are valued utilizing the fair value of the Company's stock at the grant date. These awards are recognized on the straight-line method over the requisite service period, with forfeitures recognized as they occur.

The following table summarizes the Company's time-vested award activity:


	Year Ended December 31,
	2021			2020			2019
	Shares	Weighted Average Grant-Date Fair Value		Shares	Weighted Average Grant-Date Fair Value		Shares	Weighted Average Grant-Date Fair Value
Nonvested RSA shares, January 1,	103,359	$	31.51	149,449	$	35.15	174,407	$	35.01
Granted RSA	13,460	42.26		30,638	20.14		37,641	32.77
Vested RSA	(67,825)	31.07		(72,325)	33.88		(59,344)	33.50
Forfeited RSA	(946)	24.69		(4,403)	37.11		(3,255)	30.21
Nonvested RSA shares, December 31,	48,048	35.27		103,359	31.51		149,449	35.15

Nonvested RSU, January 1,	—	$	—	—	$	—	—	$	—
Granted RSU	73,977	40.64		—	—		—	—

Nonvested RSU, December 31	73,977	40.64		—	—		—	—

At December 31, 2021, there was $1.1 million and $2.7 million of total unrecognized compensation cost related to nonvested RSA shares and RSU shares under the 2012 Plan, respectively. Those costs are expected to be recognized over a weighted-average period of 1.2 years and 2.7 years for RSA shares and RSU shares, respectively.

Stock Option Grants

The Company issued common stock options to select officers and employees primarily through individual agreements. As a result, both incentive and nonqualified stock options have been issued and may be issued in the future. The exercise price of each option varies by agreement and is based on the fair value of the stock at the date of the grant. No outstanding stock option has a term that exceeds twenty years, and all of the outstanding options are fully vested. The Company recognizes compensation cost for stock option grants over the required service period based upon the grant date fair value, which is established using a Black-Scholes valuation model. The Black-Scholes valuation model uses assumptions of risk-free interest rate, expected term of stock options, expected stock price volatility and expected dividends. Forfeitures are recognized as they occur.

The table below summarizes the status of the Company's stock options and changes during the years ended December 31, 2021, 2020 and 2019 .


(Dollars in thousands, except per share amounts)	Number of Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (in years)	Aggregate Intrinsic Value










Outstanding at January 1, 2019	274,000	$	10.38	6.75	$	6,493
Exercised	(20,000)	8.25		—	—

Outstanding at December 31, 2019	254,000	10.55		5.81	6,932
Exercised	(30,000)	8.25		—	—
Outstanding at December 31, 2020	224,000	10.86		4.92	3,789
Exercised	(184,800)	10.88		—	—
Outstanding at December 31, 2021	39,200	10.73		2.28	1,262
Exercisable at December 31, 2021	39,200	10.73		2.28	1,262