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, 2020, an aggregate of 299,602 shares subject to awards in the form of restricted stock (149,550 shares) and RSUs (150,052 shares) are outstanding under the Plan. On January 6, 2021, 151,500 restricted shares were issued pursuant to this Plan, having an aggregate value of approximately $3,082,000 and are scheduled to vest in January 2026.

Under the Company’s 2016 and 2012 equity incentive plans (collectively, the “Prior Plans”), as of December 31, 2020, (i) an aggregate of 625,875 shares in the form of restricted stock (552,125 shares) and RSUs (73,750 shares) are outstanding and have not yet vested, and (ii) with respect to 76,250 shares of common stock underlying RSUs that had been granted in 2017, 24,343 shares were deemed to have vested as of June 30, 2020, and in August 2020 such shares were issued after the Compensation Committee determined that the metrics with respect to such shares had been satisfied. RSUs with respect to the 51,907 share balance were forfeited. 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 five years from the grant date, and under certain circumstances may vest earlier.

In 2020, 2019 and 2018, the Company granted RSUs exchangeable for up to 75,026, 77,776 and 76,250 shares, respectively, of common stock upon satisfaction, through June 30, 2023, June 30, 2022 and June 30, 2021, 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:

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 2019, RSUs exchangeable in 2021 and 2022 for an aggregate of 5,250 shares were forfeited.

NOTE 12—STOCKHOLDERS’ EQUITY (Continued)

As of December 31, 2020, based on performance and market assumptions, the fair value of the RSUs granted in 2020, 2019 and 2018 is $850,000, $1,085,000 and $1,051,000, respectively. Recognition of such deferred compensation will be charged to General and administrative expense over the respective three year performance cycle. None of these RSUs were forfeited or vested during the year ended December 31, 2020.

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



	Year Ended December 31,
	2020		2019		2018
Restricted stock grants:
Number of shares		149,550		150,050		144,750
Average per share grant price	$	28.10	$	25.70	$	25.31
Deferred compensation to be recognized over vesting period	$	4,202,000	$	3,856,000	$	3,664,000

Number of non-vested shares:
Non-vested beginning of year		674,250		651,250		612,900
Grants		149,550		150,050		144,750
Vested during year		(122,125)		(114,650)		(106,000)
Forfeitures		—		(12,400)		(400)
Non-vested end of year		701,675		674,250		651,250

RSU grants:
Number of underlying shares		75,026		77,776		76,250
Average per share grant price	$	17.31	$	28.96	$	26.41
Deferred compensation to be recognized over vesting period	$	850,000	$	865,000	$	952,000

Number of non-vested shares:
Non-vested beginning of year		225,026		152,500		76,250
Grants		75,026		77,776		76,250
Vested during year		(24,343)		—		—
Forfeitures		(51,907)		(5,250)		—
Non-vested end of year		223,802		225,026		152,500

Restricted stock and RSU grants:
Weighted average per share value of non-vested shares (based on grant price)	$	24.98	$	24.96	$	23.83
Value of stock vested during the period (based on grant price)	$	3,589,000	$	2,365,000	$	2,289,000
Weighted average per share value of shares forfeited during the period (based on grant price)	$	24.03	$	25.40	$	23.59

The total charge to operations:
Outstanding restricted stock grants	$	3,529,000	$	3,229,000	$	3,028,000
Outstanding RSUs		1,157,000		641,000		482,000
Total charge to operations	$	4,686,000	$	3,870,000	$	3,510,000

As of December 31, 2020, total compensation costs of $7,814,000 and $1,449,000 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.

NOTE 12—STOCKHOLDERS’ EQUITY (Continued)

Common Stock Dividend Distributions

In each of 2019 and 2018, the Board of Directors declared an aggregate $1.80 per share in cash distributions. The following table details the Company’s dividend activity for the year ended December 31, 2020 (amounts in thousands, except per share data).


		Total			Dividend Paid			Cash	Stock
Declaration Date (a)		Dividend	Payable Date	Record Date	Cash %	Stock %		Issued	Issued
March 13, 2020	$	9,037	April 7, 2020	March 24, 2020	100.0	—	$	9,037	—
June 10, 2020 (b)(c)	$	9,068	July 31, 2020	June 22, 2020	50.0	50.0	$	4,537	263
September 9, 2020 (b)(d)	$	9,198	October 29, 2020	September 21, 2020	75.0	25.0	$	6,901	141
December 2, 2020	$	9,261	January 7, 2021	December 17, 2020	100.0	—	$	9,261	—

(a)	A dividend of $0.45 per share was declared in each period indicated.

(b)	Stockholders were entitled to elect whether the dividend payable to them would be paid in cash or shares of the Company’s common stock at the percentages indicated, subject to certain limitations.

(c)	The shares of common stock issued were valued at approximately $17.22 per share.

(d)	The shares of common stock issued were valued at approximately $16.27 per share.

On March 12, 2021, the Board of Directors declared a quarterly cash dividend of $0.45 per share on the Company’s common stock, totaling approximately $9,330,000. The quarterly dividend is payable on April 7, 2021 to stockholders of record on March 24, 2021.

Change in Authorized Capital

On July 8, 2020, the Company filed an amended and restated charter with the Maryland State Department of Assessments and Taxation, which, among other things, increased the number of shares of common stock the Company is authorized to issue from 25,000,000 shares to 50,000,000 shares.

Dividend Reinvestment Plan

On June 10, 2020, the Company temporarily suspended the dividend reinvestment feature of its Dividend Reinvestment Plan (the “DRP”). The DRP, among other things, provided 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 (as such price is calculated pursuant to the DRP). The discount was determined in the Company’s sole discretion and had been offered at a 5% discount from market. Under the DRP, the Company issued 77,000, 220,000 and 243,000 shares of common stock during 2020, 2019 and 2018, respectively.

Shares Issued Through the At-the-Market Equity Offering Program

The Company did not sell any shares during the year ended December 31, 2020. 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.