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Stock and Incentive Compensation Plans | 6 Months Ended
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Jun. 30, 2022
Share-Based Payment Arrangement [Abstract] |
Stock and Incentive Compensation Plans | Note 9 - Stock and Incentive Compensation Plans 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"). 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 stock units ("PSU") or any combination thereof. At June 30, 2022, the maximum number of shares of the Company's common stock available for issuance under the 2012 Plan was 483,858 shares. Additionally, in April 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, and the total number of shares available for issuance at June 30, 2022, was 973,911. 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. Under the ESPP, employees purchased 26,089 shares during the three and six months ended June 30, 2022, and no shares of common stock were issued pursuant to the ESPP during the three or six months ended June 30, 2021. In February 2022, the Compensation Committee ("Committee") approved and the Company granted PSUs to select officers and employees. Each PSU represents a right for the participant to receive shares of Company common stock or cash equal to the fair market value of such stock, as determined by the Committee. The number of PSUs to which the participant may be entitled will vary from 0% to 150% of the target number of PSUs, based on the Company’s achievement of specified performance criteria during the performance period compared to performance benchmarks adopted by the Committee and, further, the participant's continuous service with the Company through the third anniversary of the date of the grant. The performance period is the three-year period commencing on January 1, 2022, and ending on December 31, 2024, ("Performance Period"). Share-based compensation cost charged to income for the three and six months ended June 30, 2022 and 2021, is presented below. There was no stock option expense for any of the periods shown.
| Three Months Ended June 30, |  | Six Months Ended June 30, |  |
(Dollars in thousands) | 2022 |  | 2021 |  | 2022 |  | 2021 |  |  |  |  |  |
RSA & RSU | $ | 666 |  |  | $ | 444 |  |  | $ | 1,277 |  |  | $ | 1,058 |  |  |  |  |  |  |
PSU | 103 |  |  | — |  |  | 149 |  |  | — |  |  |  |  |  |  |
ESPP | 72 |  |  | 27 |  |  | 153 |  |  | 27 |  |  |  |  |  |  |
Total stock compensation expense | $ | 841 |  |  | $ | 471 |  |  | $ | 1,579 |  |  | $ | 1,085 |  |  |  |  |  |  |
Related tax benefits recognized in net income | $ | 177 |  |  | $ | 99 |  |  | 332 |  |  | 228 |  |  |  |  |  |  |
Restricted Stock and Performance Stock Grants The Company's RSAs and RSUs 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 Company's PSU awards are three-year cliff-vested awards, with each unit divided into two categories ("ROAA Unit Group" and "ROAE Unit Group"), composed of an equivalent number of PSUs. The ROAA Unit Group is based upon the Company's Performance Period Return on Average Assets performance, and the ROAE Unit Group is based upon the Company's Performance Period Return on Average Equity performance. The PSUs are initially valued utilizing the fair value of the Company's stock at the grant date, assuming 100% of the target number of units are achieved. Subsequent valuation of the PSUs is determined using the ratio of the actual Company's Performance Period ROAA or ROAE to the Company's targeted Performance Period ROAA or ROAE, applied to the PSUs awarded times the Company's period end stock price. Forfeitures are recognized as they occur. The following table summarizes the Company's award activity:
| Six Months Ended June 30,
| 2022 |  | 2021 |  |
| Shares |  | Weighted Average Grant-Date Fair Value |  | Shares |  | Weighted Average Grant-Date Fair Value |  |  |  |
Nonvested RSA shares, January 1, | 48,048 |  |  | $ | 35.27 |  |  | 103,359 |  |  | $ | 31.51 |  |  |  |  |
Granted RSA | 12,840 |  |  | 37.39 |  |  | 19,617 |  |  | 40.47 |  |  |  |  |
Vested RSA | (19,524) |  |  | 36.61 |  |  | (40,281) |  |  | 26.45 |  |  |  |  |
Forfeited RSA | — |  |  | — |  |  | (946) |  |  | 24.69 |  |  |  |  |
Nonvested RSA shares, June 30, | 41,364 |  |  | 35.29 |  |  | 81,749 |  |  | 36.23 |  |  |  |  |
Nonvested RSU, January 1, | 73,977 |  |  | $ | 40.64 |  |  | — |  |  | $ | — |  |  |  |  |
Granted RSU | 61,081 |  |  | 42.28 |  |  | — |  |  | — |  |  |  |  |
Forfeited RSU | (743) |  |  | 40.40 |  |  | — |  |  | — |  |  |  |  |
Nonvested RSU, June 30 | 134,315 |  |  | 41.39 |  |  | — |  |  | — |  |  |  |  |
Nonvested PSU, January 1 | — |  |  | $ | — |  |  | — |  |  | $ | — |  |  |  |  |
Granted PSU | 27,632 |  |  | 44.77 |  |  | — |  |  | — |  |  |  |  |
Nonvested PSU, June 30 | 27,632 |  |  | 44.77 |  |  | — |  |  | — |  |  |  |  |
At June 30, 2022, there was $1.1 million, $4.5 million and $1.1 million of total unrecognized compensation cost related to nonvested RSA shares, RSU shares and PSU shares under the 2012 Plan, respectively. Those costs are expected to be recognized over a weighted-average period of 1.1 years for RSA shares and 2.6 years for both RSU and PSU shares. Stock Option Grants The Company has previously issued common stock options to select officers and employees primarily through individual agreements. 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 six months ended June 30, 2022 and 2021.
(Dollars in thousands, except per share amounts) | Number of Shares |  | Weighted Average Exercise Price |  | Weighted Average Remaining Contractual Term (in years) |  | Aggregate Intrinsic Value
Six Months Ended June 30, 2022 |  |  |  |  |  |  |
Outstanding at January 1, 2022 | 39,200 |  |  | $ | 10.73 |  |  | 2.28 |  | $ | 1,262 |
Exercised | (24,800) |  |  | 9.23 |  |  | — |  |  | — |
Outstanding and exercisable at June 30, 2022 | 14,400 |  |  | 13.31 |  |  | 1.52 |  | 367 |
Six Months Ended June 30, 2021 |  |  |  |  |  |  |
Outstanding at January 1, 2021 | 224,000 |  |  | $ | 10.86 |  |  | 4.92 |  | $ | 3,789 |
Exercised | (14,800) |  |  | 9.89 |  |  | — |  |  | — |
Outstanding and exercisable at June 30, 2021 | 209,200 |  |  | 10.93 |  |  | 4.81 |  | 6,597 |

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