The Company’s 2019 Incentive Plan (“Plan”), approved by the Company’s stockholders in June 2019, permits the Company to grant, among other things, stock options, restricted stock, RSUs, performance share awards and dividend equivalent rights and any one or more of the foregoing to its employees, officers, directors and consultants. A maximum of 750,000 shares of the Company’s common stock is authorized for issuance pursuant to this Plan. As of December 31, 2019, an aggregate of 75,026 shares subject to awards in the form of RSUs are outstanding under the Plan. On January 17, 2020, 149,550 restricted shares were issued pursuant to this Plan, having an aggregate value of approximately $4,202,000 and are scheduled to vest in January 2025.

Under the Company’s 2016 and 2012 equity incentive plans (collectively, the “Prior Plans”), as of December 31, 2019, an aggregate of 824,250 shares of restricted stock (674,250 shares) and RSUs (150,000 shares) are outstanding and have not yet vested. No additional awards may be granted under the Prior Plans.

For accounting purposes, the restricted stock is not included in the shares shown as outstanding on the balance sheet until they vest; however, dividends are paid on the unvested shares. The restricted stock grants are charged to General and administrative expense over the respective vesting periods based on the market value of the common stock on the grant date. Unless earlier forfeited because the participant’s relationship with the Company terminated, unvested restricted stock awards vest on the fifth anniversary of the grant date, and under certain circumstances may vest earlier.

In 2019, 2018 and 2017, the Company granted RSUs exchangeable for up to 77,776, 76,250 and 76,250 shares, respectively, of common stock upon satisfaction, through June 30, 2022, June 30, 2021 and June 30, 2020, respectively, of specified conditions. Specifically, up to 50% of these RSUs vest upon achievement of metrics related to average annual total stockholder return (the “TSR Awards”), which metrics meet the definition of a market condition, and up to 50% vest upon achievement of metrics related to average annual return on capital (the “ROC Awards”), which metrics meet the definition of a performance condition. The holders of the RSUs are not entitled to dividends or to vote the underlying shares until such RSUs vest and shares are issued. Accordingly, the shares underlying these RSUs are not included in the shares shown as outstanding on the balance sheet. For the TSR awards, a third party appraiser prepared a Monte Carlo simulation pricing model to determine the fair value, which is recognized ratably over the service period. The Monte Carlo valuation consisted of computing the grant date fair value of the awards using the Company’s simulated stock price. For these TSR awards, the per unit or share fair value was estimated using the following assumptions:

(a)	calculated based on the historical and implied volatility.

For the ROC Awards, the fair value is based on the market value on the date of grant and the performance assumptions are re-evaluated quarterly. The Company does not recognize expense on ROC Awards which it does not expect to vest. During the year ended December 31, 2019, RSUs exchangeable in 2021 and 2022 for an aggregate of 5,250 shares were forfeited.

As of December 31, 2019, based on performance and market assumptions, the fair value of the RSUs granted in 2019, 2018 and 2017 is $865,000, $818,000 and $811,000, respectively. Recognition of such deferred compensation will be charged to General and administrative expense over the respective three year performance cycle.

In 2010, RSUs exchangeable for up to 200,000 shares of common stock were awarded pursuant to the Company’s 2009 Incentive Plan. During 2017, 113,584 shares of common stock underlying these RSUs were deemed to have vested and were issued; the balance of 86,416 shares were forfeited.

NOTE 12—STOCKHOLDERS’ EQUITY (Continued)

The following is a summary of the activity of the equity incentive plans:


	Year Ended December 31,
	2019		2018		2017
Restricted stock grants:
Number of shares		150,050		144,750		140,100
Average per share grant price	$	25.70	$	25.31	$	24.75
Deferred compensation to be recognized over vesting period	$	3,856,000	$	3,664,000	$	3,467,000

Number of non-vested shares:
Non-vested beginning of year		651,250		612,900		591,750
Grants		150,050		144,750		140,100
Vested during year		(114,650)		(106,000)		(118,450)
Forfeitures		(12,400)		(400)		(500)
Non-vested end of year		674,250		651,250		612,900

RSU grants:
Number of underlying shares		77,776		76,250		76,250
Average per share grant price	$	28.96	$	26.41	$	24.03
Deferred compensation to be recognized over vesting period	$	865,000	$	952,000	$	1,004,000

Number of non-vested shares:
Non-vested beginning of year		152,500		76,250		200,000
Grants		77,776		76,250		76,250
Vested during year		—		—		(113,584)
Forfeitures		(5,250)		—		(86,416)
Non-vested end of year		225,026		152,500		76,250

Restricted stock and RSU grants:
Weighted average per share value of non-vested shares (based on grant price)	$	24.96	$	23.83	$	22.89
Value of stock vested during the year (based on grant price)	$	2,365,000	$	2,289,000	$	3,008,000
Weighted average per share value of shares forfeited during the year (based on grant price)	$	25.40	$	23.59	$	8.37

Total charge to operations:
Outstanding restricted stock grants	$	3,229,000	$	3,028,000	$	2,966,000
Outstanding RSUs		641,000		482,000		167,000
Total charge to operations	$	3,870,000	$	3,510,000	$	3,133,000

As of December 31, 2019, total compensation costs of $7,140,000 and $1,277,000 related to non-vested restricted stock awards and RSUs, respectively, have not yet been recognized. These compensation costs will be charged to General and administrative expense over the remaining respective vesting periods. The weighted average vesting period is 2.1 years for the restricted stock and 1.5 years for the RSUs.

Common Stock Dividend Distributions

In 2019, 2018 and 2017, the Board of Directors declared an aggregate $1.80, $1.80 and $1.74 per share in cash distributions, respectively.

NOTE 12—STOCKHOLDERS’ EQUITY (Continued)

On March 13, 2020, the Board of Directors declared a quarterly cash dividend of $.45 per share on the Company's common stock, totaling approximately $9,037,000. The quarterly dividend is payable on April 7, 2020 to stockholders of record on March 24, 2020.

Dividend Reinvestment Plan

The Company’s Dividend Reinvestment Plan (the “DRP”) provides stockholders with the opportunity to reinvest all, or a portion of, their cash dividends paid on the Company’s common stock in additional shares of its common stock, at a discount of up to 5% from the market price. The discount is determined in the Company’s sole discretion. The Company is currently offering up to a 5% discount (as calculated pursuant to the DRP) from the market price. The Company issued 220,000, 243,000,and 198,000 shares of common stock under the DRP during 2019, 2018 and 2017, respectively.

Shares Issued Through Equity Offering Program

During 2019, the Company sold 180,120 shares for proceeds of $5,392,000, net of commissions of $54,000, and incurred offering costs of $192,000 for professional fees. During 2018, the Company sold 126,300 shares for proceeds of $3,245,000, net of commissions of $33,000, and incurred offering costs of $107,000 for professional fees.