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Earnings Per Common Share
 3 Months Ended
Mar. 31, 2022
Earnings Per Share [Abstract]  
Earnings Per Common Share

Note 2—Earnings Per Common Share

 

The following reconciles the numerator and denominator of the basic and diluted earnings per common share computation:

 

 

(In thousands except average market price and per share data)

         
   Three months ended 
   March 31, 
   2022   2021 
Numerator (Net income available to common shareholders)  $3,489   $3,255 
Denominator          
Weighted average common shares outstanding for:          
Basic shares   7,518    7,476 
Dilutive securities:          
Deferred compensation   33    36 
Restricted stock -Treasury stock method   44    11 
Diluted shares   7,595    7,523 
Earnings per common share:          
Basic  $0.46   $0.44 
Diluted  $0.46    0.43 
           
The average market price used in calculating assumed number of shares  $20.99   $18.43 

 

Non-Employee Director Deferred Compensation Plan

Under the Company’s Non-Employee Director Deferred Compensation Plan, as amended and restated effective as of January 1, 2021, a director may elect to defer all or any part of annual retainer and monthly meeting fees payable with respect to service on the board of directors or a committee of the board. Units of common stock are credited to the director’s account as of the last day of such calendar quarter during which the compensation is earned and are included in dilutive securities in the table above. The non-employee director’s account balance is distributed by issuance of common stock within 30 days following such director’s separation from service from the board of directors. At March 31, 2022 and December 31, 2021, there were 88,748 and 85,765 units in the plan, respectively. The accrued liability related to the plan at March 31, 2022 and December 31, 2021 amounted to $1.2 million and $1.1 million, respectively, and is included in “Other liabilities” on the balance sheet.

First Community Corporation 2011 Stock Incentive Plan

In 2011, the Company and its shareholders adopted a stock incentive plan whereby 350,000 shares were reserved for issuance by the Company upon the grant of stock options or restricted stock awards under the plan (the “2011 Plan”). The 2011 Plan provided for the grant of options to key employees and directors as determined by a stock option committee made up of at least two members of the board of directors. Options are exercisable for a period of ten years from the date of grant. There were no stock options outstanding and exercisable at March 31, 2022, December 31, 2021 and March 31, 2021. The 2011 Plan expired on March 15, 2021 and no new awards may be granted under the 2011 Plan. However, any awards outstanding under the 2011 Plan will continue to be outstanding and governed by the provisions of the 2011 Plan.

Under the 2011 Plan, the employee restricted shares and units generally cliff vest over a three-year period and the non-employee director shares vest approximately one year after issuance. The unrecognized compensation cost at March 31, 2022 and December 31, 2021 for non-vested shares amounted to $243.6 thousand and $293.9 thousand, respectively. Each unit is convertible into one share of common stock at the time the unit vests. The related compensation cost for time-based units (“TRSUs”) is accrued over the vesting period and was $12.2 thousand and $7.1 thousand respectively, for the three months ended March 31, 2022 and March 31, 2021.

Historically, the Company granted time-based equity awards that vested based on continued service. Beginning in 2021 and in addition to time-based equity awards, the Company began granting performance-based equity awards in the form of performance-based restricted stock units, with the target number of performance-based restricted stock units for the Company’s Chief Executive Officer and other executive officers representing 50% of total target equity awards. These performance-based restricted stock units cliff vest over three years and include conditions based on the following performance measures: total shareholder return, return on average equity, and non-performing assets. The Company granted 13,302 performance-based restricted stock units (“PRSUs”) with a fair value of $234.0 thousand during 2021. The related compensation cost for the PRSUs is accrued over the vesting period and was $19.5 thousand and $6.5 thousand, respectively, during the three months ended March 31, 2022 and March 31, 2021. The total accrued liability was $124.3 thousand and $144.0 thousand at March 31, 2022, and December 31, 2021, respectively, including both time-based and performance-based restricted stock units.

First Community Corporation 2021 Omnibus Equity Incentive Plan

In 2021, the Company and its shareholders adopted an omnibus equity incentive plan whereby 225,000 shares were reserved for issuance by the Company to help the company attract, retain and motivate directors, officers, employees, consultants and advisors of the Company and its subsidiaries (the “2021 Plan”). The 2021 Plan replaced the 2011 Plan. No awards were granted under the 2021 Plan as of March 31, 2021. During the three months ended March 31, 2022, the Company granted 7,358 restricted stock awards to Directors with a fair value of $154,000. The restricted stock awards will fully vest on January 1, 2023. At March 31, 2022 the unrecognized compensation cost for non-vested shares amounted to $128.3 thousand. During the three months ended March 31, 2022, the Company granted 11,738 TRSUs and 11,738 PRSUs with a total fair value of $245.7 thousand and $245.7 thousand respectively. The related compensation cost for TRSUs and PRSUs is accrued over the vesting period and was $13.7 thousand and $13.7 thousand respectively, for the three months ended March 31, 2022. At March 31, 2022 and December 31, 2021, the Company had 195,654 and 225,000 shares, respectively, reserved for future grants under the 2021 Plan.