Stock Compensation |
12 Months Ended |
|---|---|
Dec. 31, 2021 | |
| Stock Compensation [Abstract] | |
| Stock Compensation | NOTE 11 – STOCK COMPENSATION 2011 Executive Incentive Compensation Plan On March 28, 2011 the Board adopted and on May 19, 2011 the Company’s shareholders approved the Company’s 2011 Executive Incentive Compensation Plan (“2011 Incentive Plan”). The 2011 Incentive Plan authorizes incentive awards to officers, key employees and non-employee directors in the form of options (incentive and non-qualified), stock appreciation rights, restricted stock, restricted stock units, performance stock units (“deferred stock”), performance cash units, and other awards in stock, cash, or a combination of stock and cash. The 2011 Incentive Plan, as amended, allows the issuance of up to 2,500,000 shares of common stock. At December 31, 2021, 1,425,008 shares have been issued under the 2011 Incentive Plan, there are no shares subject to currently outstanding options, deferred stock awards, and unvested restricted stock units, and 1,074,992 shares are eligible for grant under future awards. The closing of the E&S Sale Transaction on August 2, 2021 constituted a “Change in Control” as defined in the Company’s 2011 Incentive Plan. In accordance with the determinations and approvals of the Compensation Committee, effective on August 1, 2021, each Incentive Award granted and outstanding under the 2011 Incentive Plan and not otherwise forfeited or expired in accordance with its terms was fully vested and exercisable and any restrictions lapsed. After giving effect to such acceleration and vesting, on the August 2, 2021 closing date:All then-outstanding restricted stock units (RSUs”) were settled by exchanging them for the equivalent number of shares of the Company’s common stock specified in the respective RSU award agreements, with the shares of the Company’s common stock issued on settlement of the RSUs being issued and outstanding as of the closing date.All then-outstanding stock options having an exercise price less than the Fair Market Value (as defined in the 2011 Incentive Plan) on the closing date were settled by exchanging the options for a “net” number of shares of the Company’s common stock as if exercised on a net or cashless basis as provided in the 2011 Incentive Plan (for administrative convenience, rounded up to the next whole share), with the net shares of the Company’s common stock issued on settlement of these stock options being issued and outstanding as of the closing date.Following the disposition of the outstanding RSUs and stock options as described above, these Incentive Awards were terminated and cancelled as of the closing date.All then-outstanding stock options having an exercise price equal to or greater than the Fair Market Value on the closing date were terminated and cancelled as of the closing date without any payment therefor.Due to conditions of the Pineapple merger agreement, no additional awards have been made under the 2011 Incentive Plan following August 2, 2021. Stock Options Outstanding The following table summarizes changes in the number of outstanding stock options under the Director Plan, Stock Plan and the 2011 Incentive Plan during the two years ended December 31, 2021. Weighted average Weighted average exercise price remaining Options per share contractual termOutstanding – December 31, 2019 1,130,472 $ 7.28 3.48 yearsAwarded 191,301 5.10 Exercised (8,000) 2.64 Forfeited (140,583) 10.90 Outstanding – December 31, 2020 1,173,190 6.52 3.35 yearsAwarded — — Exercised (799,390) 4.70 Forfeited (373,800) 10.43 Outstanding – December 31, 2021 — — 0 years Exercisable at December 31, 2021 — $ — 0 yearsExpected to vest December 31, 2021 — $ — 0 years The fair value of awards issued under the Company’s 2011 Incentive Plan is estimated at grant date using the Black-Scholes option-pricing model. The following table displays the assumptions used in the model. No awards were granted in 2021. Year Ended December 31 2020Expected volatility 31.3%Risk free interest rate 2.2%Expected holding period6 yearsDividend yield 3.0% Because all outstanding options were either vested and exercised or cancelled, the aggregate intrinsic value of all options (the amount by which the market price of the stock on the last day of the period exceeded the market price of the stock on the date of grant) outstanding at December 31, 2021 was $0. The intrinsic value of options exercised during the year was $1,961,000 in 2021 and $18,000 in 2020. Net cash proceeds from the exercise of all stock options were $0 in 2021 and 2020. The Company receives an income tax benefit related to the gains received by officers and key employees who make disqualifying dispositions of stock received on exercise of qualified incentive stock options and on non-qualified options. The amount of tax benefit received by the Company was $0 in both 2021 and 2020. The tax benefit amounts have been credited to additional paid-in capital. Deferred Stock Outstanding The following table summarizes the changes in the number of deferred stock shares under the Stock Plan and 2011 Incentive Plan over the period from December 31, 2019 to December 31, 2021: Weighted Average Grant Date Shares Fair ValueOutstanding – December 31, 2019 321,227 $ 3.37Granted 95,631 5.33Vested (57,952) 2.81Forfeited (86,211) 4.22Outstanding – December 31, 2020 272,695 3.37Granted — —Vested (194,586) 4.05Forfeited (78,109) 3.56Outstanding – December 31, 2021 — — The grant date fair value is calculated based on the Company’s closing stock price as of the grant date. Compensation Expense Share-based compensation expense is recognized based on the fair value of awards granted over the vesting period of the award. Share-based compensation expense recognized for 2021 and 2020 was $559,000 and $463,000 before income taxes and $442,000 and $366,000 after income taxes, respectively. There was no unrecognized compensation expense for the Company’s plans at December 31, 2021 due to the acceleration of all outstanding equity awards as part of the E&S Sale Transaction. Share-based compensation expense is recorded as a part of selling, general and administrative expenses. Employee Stock Purchase Plan Under the Company’s Employee Stock Purchase Plan (“ESPP”), employees are able to acquire shares of common stock at 85% of the price at the end of each current quarterly plan term. The ESPP is considered compensatory under current Internal Revenue Service rules. At December 31, 2021, 59,303 shares remain available for purchase under the ESPP. The ESPP was suspended effective March 31, 2021 due to conditions of the Pineapple merger agreement. Employee Stock Ownership Plan (ESOP) All eligible employees of the Company participate in the ESOP after completing one year of service. Contributions are allocated to each participant based on compensation and vest 20% after two years of service and incrementally thereafter, with full vesting after six years. At December 31, 2021, the ESOP held 545,631 shares of the Company’s common stock, all of which have been allocated to the accounts of eligible employees. Contributions to the plan are determined by the Board of Directors and can be made in cash or shares of the Company’s stock. The 2020 ESOP contribution was $329,968 for which the Company issued 72,203 shares in 2021. Due to conditions of the Pineapple Merger Agreement, no additional contributions will be made to the ESOP. |