Note 13 - Stock Based Compensation

12 Months Ended

Dec. 31, 2015

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

Note 13. Stock Based Compensation

The Company recorded stock based compensation expense of $137 thousand and $58 thousand for the years ended December 31, 2015 and 2014, respectively.

The Company has a 2005 Stock Option Plan (the Plan) pursuant to which the Board of Directors may grant stock options to directors, officers and employees. Under the fair value recognition provisions of relevant accounting guidance, stock-based compensation cost is measured at the grant date based on the fair value of the award and is recognized as expense on a straight-line basis over the requisite service period, which is the vesting period.

The Company uses the Black-Scholes option pricing model to determine the fair value of stock options. The fair value of the stock based payment awards is affected by the price of our stock and a number of financial assumptions and variables. These variables include the risk free interest rate, expected dividend rate, expected stock price volatility and the expected life of the options.  No stock options were granted during 2015. On December 18, 2014, the Board of Directors granted 165 thousand shares which are vesting over a five-year period. Financial assumptions and variables used to determine the fair value of these stock options were: risk free interest rate of 2.01%, an expected term of 7.5 years, an expected stock price volatility of 26% and a dividend rate of 0%. Compensation expense is charged to income ratably over the vesting period and was $75 thousand and $2 thousand in 2015 and 2014, respectively. As of December 31, 2015, there was $301 thousand of total unrecognized compensation cost related to nonvested stock options granted under the Plan. The cost is expected to be recognized over a period of four years. All previously issued options were fully vested at the end of 2012, resulting in no compensation expense being recorded in 2015 or 2014.

A summary of option activity under the 2005 stock option plan during the year ended December 31, 2015 is as follows:

	Options Outstanding			Weighted Average Exercise Price		Aggregate Intrinsic Value(1)		Weighted Average Contractual Term (years)
Balance at December 31, 2014		549,560		$	8.61
Granted		–			–
Exercised		–			–
Forfeited		(3,100	)		7.76
Balance at December 31, 2015		546,460		$	8.62	$	–		3.06
Exercisable at December 31, 2015		437,793		$	9.04	$	–		1.59

(1) The aggregate intrinsic value of a stock option in the table above represents the total pre-tax intrinsic value (the amount by which the current market value of the underlying stock exceeds the exercise price of the option) that would have been received by the option holders had all option holders exercised their options on December 31, 2015.

In 2009, the Board of Directors authorized 132,000 shares of common stock for issuance under the Restricted Stock Plan. The plan provides for restricted stock awards to key employees. Restricted shares awarded to employees generally vest over a five-year period and compensation expense is charged to income ratably over the vesting period and was $62 thousand in 2015 and $56 thousand in 2014. Compensation is accounted for using the fair market value of the Company’s common stock on the date the restricted shares are awarded. The weighted-average grant date fair value of restricted stock granted in 2015 was $7.91 compared to $6.25 in 2014.  The Company granted 10,969 and 17,268 shares of restricted stock under the plan in 2015 and 2014, respectively.

As of December 31, 2015, there was $184 thousand of total unrecognized compensation cost related to restricted stock granted under the Plan. The cost is expected to be recognized through 2020. A summary of the activity for restricted stock awards for the periods indicated is presented below:

	2015					2014
	Shares			Weighted- Average Grant Date Fair Value		Shares			Weighted- Average Grant Date Fair Value
Nonvested at beginning of year		37,727		$	5.56		27,846		$	5.05
Granted		10,969			7.91		17,268			6.25
Vested		(10,848	)		5.56		(7,387	)		5.23
Cancelled		–			–		–			–
Nonvested at end of year		37,848		$	6.24		37,727		$	5.56