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STOCK OPTIONS, RESTRICTED STOCK, RESTRICTED STOCK UNITS, AND DEFERRED COMPENSATION
 12 Months Ended
Dec. 31, 2022
Share-Based Payment Arrangement [Abstract]  
STOCK OPTIONS, RESTRICTED STOCK, RESTRICTED STOCK UNITS, AND DEFERRED COMPENSATION

Note 18—STOCK OPTIONS, RESTRICTED STOCK, RESTRICTED STOCK UNITS, AND DEFERRED COMPENSATION

Reclassification of Stock Units

 

In June 2022, all of the Company’s stock units were reclassified from “Other liabilities” to “Nonvested restricted stock and stock units” and are included in “Nonvested restricted stock and restricted stock and stock units” on the Balance Sheet.

 

The table below shows the balance as of June 30, 2022 for each type of stock unit reclassified.

 

 

(Dollars in thousands)    
Type of stock unit  Balance 
Nonemployee Director deferred compensation stock units   1,201 
Time-Based Restricted Stock Units   79 
Performance-Based Restricted Stock Units   138 
Total stock units reclassified   1,418 

 

The table below shows the components of “nonvested restricted stock and stock units” as of the years ended December 31, 2022, 2021, and 2020.

             
(Dollars in thousands)  Year ended December 31, 
Nonvested restricted stock and stock units  2022   2021   2020 
Non-employee director deferred compensation stock plan deferred stock units   1,260    —1   —1
Time-based restricted stock units - officer   129    —2   —2
Performance-based restricted stock units - officer   218    —    — 
Restricted stock – officer and director   (146)   (294)   (283)
Total nonvested restricted stock and stock units   1,461    (294)   (283)

 

1In June 2022, all of the Company’s stock units were reclassified from “Other liabilities”. At December 31, 2021 and December 31, 2020, $1.107 million was $1.056 million, respectively, were included in “Other liabilities”.
2In June 2022, all of the Company’s stock units were reclassified from “Other liabilities”. At December 31, 2021 and December 31, 2020, $144 thousand was $107 thousand, respectively, were included in “Other liabilities”.

 

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.

 

The table below shows the following information related to First Community Corporation’s Non-Employee Director Deferred Compensation Plan: accumulated share units and accrued liability as of the years ended December 31, 2022, 2021, and 2020; and the related director compensation expense for the twelve months ended 2022, 2021, and 2020.

             
   Year ended December 31, 
  2022   2021   2020 
Non-employee director deferred compensation plan accumulated share units   93,488    85,764    88,411 
Accrued liability (dollars in thousands)1   1,260    1,107    1,056 
Related director compensation expense (dollars in thousands)   153    140    148 

 

1Recorded in “Nonvested restricted stock and stock units” effective June 2022; recorded in “Other liabilities” prior to June 2022.

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 December 31, 2022, December 31, 2021 and December 31, 2020. 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. 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.

 

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.

 

The table below shows stock awards granted during the twelve months ended December 31, 2022, 2021, and 2020.

             
(In shares/units)     Twelve Months ended December 31,  
Stock awards   20221     20212     20202  
Time-based restricted stock units - officer     11,738       —       —  
Performance-based restricted stock units – officer3     11,738       13,301       —  
Restricted stock – officer     2,201       13,301       13,267  
Restricted stock – director     7,359       7,960       2,662  

 

1Stock awards in 2022 were granted under the First Community Corporation 2021 Omnibus Equity Incentive Plan.
2Stock awards in 2021 and 2020 were granted under the First Community Corporation 2011 Stock Incentive Plan.
311,738 units represent the target payout with a maximum payout of 17,608 units.

The table below shows the fair value of stock awards granted during the twelve months ended December 31, 2022, 2021, and 2020.

             
(Dollars in thousands)     Twelve months ended December 31,  
Fair value of stock awards on grant date   20221     20212     20202  
Time-based restricted stock units - officer     246       —       —  
Performance-based restricted stock units – officer3     246       234       —  
Restricted stock – officer     46       234       261  
Restricted stock – director     154       140       55  

 

1Stock awards in 2022 were granted under the First Community Corporation 2021 Omnibus Equity Incentive Plan.
2Stock awards in 2021 and 2020 were granted under the First Community Corporation 2011 Stock Incentive Plan.
3$246 thousand represents the target payout with a maximum payout of $369 thousand.

The table below shows the compensation expense related to stock awards granted during the twelve months ended December 31, 2022, 2021, and 2020.

                   
(Dollars in thousands)     Year ended December 31,  
Compensation expense related to stock awards   2022     2021     2020  
Time-based restricted stock units – officer1     94       19       16  
Performance-based restricted stock units – officer2     153       65       —  
Restricted stock – officer3     206       223       197  
Restricted stock – director4     141       140       55  

 

1Expense in 2022 consists of $75.1 thousand related stock awards granted under the First Community Corporation 2021 Omnibus Equity Incentive Plan and $19.1 thousand related stock awards granted under the First Community Corporation 2011 Stock Incentive Plan. Expenses in 2021 and 2020 were related to stock awards granted under the First Community Corporation 2011 Stock Incentive Plan.
2Expense in 2022 consists of $75.1 thousand related stock awards granted under the First Community Corporation 2021 Omnibus Equity Incentive Plan and $78.0 thousand related stock awards granted under the First Community Corporation 2011 Stock Incentive Plan. Expenses in 2021 and 2020 were related to stock awards granted under the First Community Corporation 2011 Stock Incentive Plan.
3Expense in 2022 consists of $23.8 thousand related stock awards granted under the First Community Corporation 2021 Omnibus Equity Incentive Plan and $182.1 thousand related stock awards granted under the First Community Corporation 2011 Stock Incentive Plan. Expenses in 2021 and 2020 were related to stock awards granted under the First Community Corporation 2011 Stock Incentive Plan.
4Expense in 2022 was related to stock awards granted under the Community Corporation 2021 Omnibus Equity Incentive Plan. Expenses in 2021 and 2020 were related to stock awards granted under the First Community Corporation 2011 Stock Incentive Plan.

The table below shows the First Community Corporation 2021 Omnibus Equity Incentive Plan (“2021 Incentive Plan”) initial reserve at May 19, 2021; stock awards granted under the 2021 Incentive Plan from its inception through December 31, 2022; and the 2021 Incentive Plan remaining reserve at December 31, 2022.

     
(In shares / units)    
First Community Corporation 2021 Omnibus Equity Incentive Plan  2022 
Initial reserve – May 19, 2021   225,000 
Shares  / units granted     
Time-based restricted stock units - officer   (11,738)
Performance-based restricted stock units – officer1   (17,608)
Restricted stock – officer   (2,201)
Restricted stock – director   (7,359)
Total nonvested restricted stock and stock units   186,094 

 

1Performance-based restricted stock units are initially granted and expensed at target levels; however, they are reserved at maximum levels.