Atlantic Union Bankshares Corporation Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

EMPLOYEE BENEFITS AND STOCK BASED COMPENSATION (Tables)

EMPLOYEE BENEFITS AND STOCK BASED COMPENSATION (Tables)

12 Months Ended

Dec. 31, 2017

Employee Benefits and Share-based Compensation, Noncash [Abstract]

The following 401(k) Plan match and other discretionary contributions were made to the Company’s employees, in accordance with the plans described above, in 2017, 2016, and 2015 (dollars in thousands):



	2017		2016		2015
401(k) Plan	$	3,505	$	3,263	$	3,120
ESOP	1,255		1,425		1,146
Cash	1,461		1,496		1,146
Total	$	6,221	$	6,184	$	5,412

Schedule of Recognized Stock-Based Compensation Expense

For the years ended December 31, 2017, 2016, and 2015, the Company recognized stock-based compensation expense (included in salaries and benefits expense) (dollars in thousands, except per share data) as follows:



	Year Ended December 31,
	2017		2016		2015
Stock-based compensation expense	$	4,648	$	3,270	$	1,388
Reduction of income tax expense	1,467		1,104		405
Per share compensation cost	$	0.06	$	0.05	$	0.02

Summary of Stock Option Activity

The following table summarizes the stock option activity during the year ended December 31, 2017:



	Stock Options (shares)		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life	Aggregate Intrinsic Value
Outstanding as of December 31, 2016	188,260		$	14.94
Granted	—		—
Exercised	(63,476	)	16.35
Forfeited	—		—
Expired	(3,041	)	26.10
Outstanding as of December 31, 2017	121,743		13.93		1.65	$	2,708,076
Exercisable as of December 31, 2017	121,743		13.93		1.65	2,708,076

Summary of Nonvested Stock Activity

The following table summarizes the restricted stock activity for the year ended December 31, 2017:



	Number of Shares of RSAs		Weighted Average Grant-Date Fair Value
Balance, December 31, 2016	371,438		$	23.70
Granted	125,738		35.89
Net settle for taxes	(47,187	)	37.80
Vested	(110,057	)	24.93
Forfeited	(13,196	)	26.55
Balance, December 31, 2017	326,736		27.68

Summary of Performance Stock Activity

PSUs are granted to certain employees at no cost to the recipient and are subject to vesting based on achieving certain performance metrics; the grant of PSUs is subject to approval by the Company’s Compensation Committee at its sole discretion. PSUs may be paid in cash or shares of common stock or a combination thereof. Holders of PSUs have no right to vote the shares represented by the units. In 2017, the PSUs awarded were market based awards with the number of PSUs ultimately earned based on the Company’s total shareholder return (“TSR”) as measured over the performance period.



	Number of Shares of PSUs		Weighted Average Grant- Date Fair Value
Balance, December 31, 2016	145,757		$	21.05
Granted	37,249		39.31
Vested	—		—
Forfeited	(48,656	)	24.19
Balance, December 31, 2017	134,350		24.98

Schedule of Share-Based Payment Award, Stock Options, Valuation Assumptions

The fair value of each PSU granted is estimated on the date of grant using the Monte Carlo simulation lattice model that uses the assumptions noted in the following table:



	2017		2016		2015
Dividend yield⁽¹⁾	2.15	%	3.36	%	3.12	%
Expected life in years⁽²⁾	2.85		2.85		2.70
Expected volatility⁽³⁾	23.35	%	22.16	%	21.50	%
Risk-free interest rate⁽⁴⁾	1.40	%	0.83	%	0.75	%

(1) Calculated as the ratio of the current dividend paid per the stock price on the date of grant.

(2) Represents the remaining performance period as of the grant date

(3) Based on the historical volatility for the period commensurate with the expected life of the PSUs.

(4) Based upon the zero-coupon U.S. Treasury rate commensurate with the expected life of the PSUs on the grant date.

Estimated Unamortized Compensation Expense Recognized in Future

The estimated unamortized compensation expense, net of estimated forfeitures, related to restricted stock and performance stock issued and outstanding as of December 31, 2017 that will be recognized in future periods is as follows (dollars in thousands):



	Restricted Stock		Performance Stock		Total
2018	$	3,539	$	907	$	4,446
2019	2,725		624		3,349
2020	1,156		41		1,197
2021	97		—		97
Total	$	7,517	$	1,572	$	9,089