Note 11 - Benefit Plans

9 Months Ended

Sep. 30, 2020

Notes to Financial Statements

Share-based Payment Arrangement [Text Block]

Note 11: Benefit Plans

The Company has stock-based employee compensation plans, which are described in the Company’s 2019 Annual Report. The following tables below summarize transactions under the Company’s equity plans for the nine months ended September 30, 2020:

Stock Options

All remaining stock options from prior year issuances were exercised in 2019 leaving no amounts outstanding as of September 30, 2020. The total intrinsic value of stock options exercised for the nine months ended September 30, 2020 and 2019 was $0 and $243,769, respectively. The total intrinsic value of outstanding stock options (including exercisable) was $0 and $67,270 at September 30, 2020 and 2019, respectively.

Restricted Stock	Number of Shares			Weighted Average Grant- Date Fair Value
Balance of shares non-vested as of January 1, 2020		24,378		$	22.75
Granted		18,713			21.48
Vested		(11,464	)		22.13
Forfeited		(5,090	)		22.37
Balance of shares non-vested as of September 30, 2020		26,537		$	22.20

In February 2020, the Company granted 5,579 shares of restricted stock to directors pursuant to the 2015 Equity Plan that have a cliff vesting at the end of one year and thus, expensed over that same period. These shares had a grant date market price of $23.50 per share. The total amount of expense for restricted stock grants to directors (including all previous year’s grants) during the nine months ended September 30, 2020 and 2019 was $102,244 and $97,241, respectively.

For the nine months ended September 30, 2020 and 2019, the Company granted 13,134 and 9,932 shares, respectively, of restricted stock to officers that have a cliff vesting at the end of three years. The expense is being recognized over the applicable vesting period. The total amount of expense for restricted stock grants to officers (including all previous year’s grants) during the nine months ended September 30, 2020 and 2019 was $74,697 and $125,379, respectively.

Restricted Stock Units	Performance Stock Units		Weighted Average Grant Date Fair Value
Balance of shares non-vested as of January 1, 2020		-	$	-
Granted		53,075		15.40
Vested		-		-
Forfeited		-		-
Balance of shares non-vested as of September 30, 2020		53,075	$	15.40

During 2020, the Company has granted restricted stock units representing 53,075 hypothetical shares of common stock to officers. There are three possible levels of incentive awards: threshold (25%); target (50%); and maximum (100%). The restricted stock units vest based on two financial performance factors over the period from grant date to December 31, 2022 (the “Performance Period”). The two performance measurements of the Company (and the weight given to each measurement) applicable to each award level are as follows: (i) Earnings Per Share (50%) and (ii) Return on Average Assets (50%). In determining compensation expense, the fair value of the restricted stock unit awards was determined based on the closing price of the Company’s common stock on the date of grant, which averaged $15.40 per share. The expense is being recognized over the applicable vesting period. Due to the fact that the measurements cannot be determined at the time of the grant, the Company currently estimates that the most likely outcome is the achievement between the target and maximum levels. If during the Performance Period, additional information becomes available to lead the Company to believe a different level will be achieved for the Performance Period, the Company will reassess the number of units that will vest for the grant and adjust its compensation expense accordingly on a prospective basis. The total amount of expense for restricted stock units during the nine months ended September 30, 2020 and 2019 was ($68,728) and $323,646, respectively. Year-to-date credit amounts in 2020 and the decrease from the period in 2019 are due to the reversal of certain accruals related to final performance agreement payouts under previous grants and the reduction of stock price for valuing compensation expense in the current year.

Total stock-based compensation expense recognized for the nine months ended September 30, 2020 and 2019 was $108,213 and $546,266, respectively. As of September 30, 2020, there was $666,272 of unrecognized compensation expense related to non-vested restricted stock awards to be recognized over the remaining vesting period.