NOTE 17 – STOCK-BASED COMPENSATION PLANS

The Company has adopted the HBT Financial, Inc. Omnibus Incentive Plan (the “Omnibus Incentive Plan”). The Omnibus Incentive Plan provides for grants of (i) stock options, (ii) stock appreciation rights, (iii) restricted shares, (iv) restricted stock units, (v) performance awards, (vi) other share-based awards and (vii) other cash-based awards to eligible employees, non-employee directors and consultants of the Company. The maximum number of shares of common stock available for issuance under the Omnibus Incentive Plan is 1,820,000 shares.

Restricted Stock Units

A restricted stock unit grants a participant the right to receive one share of common stock, following the completion of the requisite service period. Units are classified as equity. Compensation cost is based on the Company’s stock price on the grant date.

On January 28, 2020, the Company granted 70,400 restricted stock units to certain key employees which vest in four equal annual installments beginning on February 1, 2021. On January 28, 2020, the Company also granted 2,750 restricted stock units to non-employee directors which vest on February 1, 2021.

Stock Appreciation Rights

A stock appreciation right grants a participant the right to receive an amount of cash, the value of which equals the appreciation in the Company’s stock price between the grant date and the exercise date. Stock appreciation rights units are classified as liabilities. Prior to becoming a public entity, the liability was based on the intrinsic value of the stock appreciation rights, calculated using the grant date assigned value and an independent appraisal of the Company’s stock price that was subject to approval by the Board of Directors. Since becoming a public entity on October 11, 2019, the liability was based on an option-pricing model used to estimate the fair value of the stock appreciation rights.

On September 1, 2019, the Company granted 110,160 stock appreciation rights to certain key employees, at a grant date assigned value of $25.75 per stock appreciation right, subsequently adjusted to $16.32, reflecting a decrease per stock appreciation right equal to the $9.43 per share special dividend paid to shareholders of record prior to the initial public offering. Of the stock appreciation rights granted on September 1, 2019, 79,560 stock appreciation rights were fully vested on the grant date and 30,600 stock appreciation rights vest in four equal annual installments beginning on September 1, 2020.

As of December 31, 2019 and 2018, the liability recorded for outstanding stock appreciation rights was $409,000 and $1,884,000, respectively. During the years ended December 31, 2019, 2018, and 2017, the Company recognized $343,000, $540,000, and $291,000 as compensation expense, respectively. As of December 31, 2019, unrecognized compensation cost related to non-vested stock appreciation rights units was $140,000. As of December 31, 2018, there was no unrecognized compensation cost related to non-vested stock-based compensation agreements.

As of December 31, 2019, the liability recorded for previously exercised stock appreciation rights was $1,512,000, which will be paid in five remaining equal annual installments beginning in 2020. As of December 31, 2018, the liability recorded for previously exercised units was $176,000 and was paid in 2019.

A summary of the status of stock appreciation rights as of December 31, 2019 and 2018, and changes during the years ended December 31, 2019, 2018, and 2017 is as follows:


	Stock Appreciation Rights	Weighted Average Grant Date Assigned Value
Outstanding, December 31, 2016	116,280	$	5.66
Granted	—		—
Exercised	—		—
Forfeited	—		—
Outstanding, December 31, 2017	116,280	$	5.66
Granted	—		—
Exercised	(24,480)		5.43
Forfeited	—		—
Outstanding, December 31, 2018	91,800	$	5.73
Granted	110,160		16.32
Exercised	(91,800)		5.73
Forfeited	—		—
Outstanding, December 31, 2019	110,160	$	16.32

Exercisable, December 31, 2019	79,560	$	16.32
Exercisable, December 31, 2018	91,800	$	5.73

A further summary of outstanding stock appreciation rights as of December 31, 2019, is as follows:


			Weighted Average
			Remaining
Range of Grant Date Assigned Values	Outstanding	Exercisable	Contractual Term
$ 16.32	110,160	79,560	9.7	years