Note 14 - Stock Compensation Plans

12 Months Ended

Dec. 31, 2022

Notes to Financial Statements

Share-Based Payment Arrangement [Text Block]

Note 14. STOCK COMPENSATION PLANS

FNCB has a Long-Term Incentive Compensation Plan (“LTIP”) for directors, executive officers and key employees. The LTIP authorizes up to 1,200,000 shares of common stock for issuance and provides the Board of Directors with the authority to offer several different types of long-term incentives, including stock options, stock appreciation rights, restricted stock, restricted stock units, performance units and performance shares. The Board of Directors granted awards, comprised solely of shares of restricted stock, to executives and certain key employees under the terms of the LTIP of 71,860 shares in 2022 and 66,065 shares in 2021.

The following table summarizes the activity related to FNCB’s unvested restricted stock awards during the years ended December 31, 2022 and 2021:

	For the Years Ended December 31,
	2022					2021
				Weighted-					Weighted-
				Average					Average
	Restricted			Grant Date		Restricted			Grant Date
	Shares			Fair Value		Shares			Fair Value
Unvested restricted stock awards at January 1,		174,297		$	7.37		159,913		$	7.07
Awards granted		71,860			9.64		66,065			7.98
Forfeitures		(5,503	)		8.17		(7,443	)		7.38
Vestings		(54,689	)		7.38		(44,238	)		7.20
Unvested restricted stock awards at December 31,		185,965		$	8.22		174,297		$	7.37

For the years ended  December 31, 2022 and 2021, stock-based compensation expense, which is included in salaries and benefits expense in the consolidated statements of income, totaled $448 thousand in 2022 and $376 thousand in 2021. Total unrecognized compensation expense related to unvested restricted stock awards at  December 31, 2022 and 2021 was $1.2 million and $992 thousand, respectively. Unrecognized compensation expense related to unvested shares of restricted stock is expected to be recognized over a weighted-average period of 3.5 years.

On July 1, 2022 and 2021, 1,869 shares and 2,062 shares, respectively, of FNCB's common stock were granted under the LTIP to each of the Bank's non-employee directors. The total number of shares granted to the directors were 16,821 in 2022 and 18,558 in 2021. The shares of common stock immediately vested to each director upon grant, and the fair value per share on the grant date was $8.03 for the 2022 grant and $7.28 for the 2021 grant. Director fees of $135 thousand in both years of 2022 and 2021, associated with these grants, was recognized on each of the respective grant dates and included in other operating expense in the consolidated statements of income. At December 31, 2022, there were 596,029 shares of common stock available for award under the LTIP.