EQUITY INCENTIVE PLANS

6 Months Ended

Jun. 30, 2018

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

NOTE 9

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EQUITY INCENTIVE PLANS

Under the Company’s 2016 Equity Incentive Plan the Company may grant restricted stock awards to its employees and directors for up to 75,000 shares of its common stock.

A restricted stock award (the “award”) is a grant of shares of Company common stock for no consideration, subject to a vesting schedule or the satisfaction of market conditions or performance criteria. Awarded shares are held in reserve for each grantee by the Company’s transfer agent, and will be issued from previously authorized but unissued shares upon vesting. The fair value of the stock awards, based on the market price at the grant date, will be recognized over the five-year vesting period. At June 30, 2018

, 34,000 shares remain available to award under the Plan.

Under the Company’s 2012 Equity Incentive Plan the Company granted stock options to its employees and directors in the form of incentive stock options and non-qualified stock options totaling 231,894 shares of its common stock. The exercise price of each stock option was not less than the fair market value of the Company’s common stock on the date of grant, and the maximum term of each option is 10 years from the date of each award. The vesting period was five years from the date of grant, with vesting at 20% per year.

Under the 2012 Equity Incentive Plan, the Company also granted stock awards to management, employees and directors. Awarded shares are held in reserve for each grantee by the Company’s transfer agent, and were issued from previously authorized but unissued shares upon vesting. The fair value of the stock awards, based on the market price at the grant date, is recognized over the five-year vesting period.

The Company’s 2012 Equity Incentive Plan was terminated upon approval of the 2016 Equity Incentive Plan.

Stock Options

A summary of option activity under the 2012 Equity Incentive Plan for the six months ended June 30, 2018 is presented below:

Options	Number of Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term		Aggregate Intrinsic Value
		(In thousands)				(In years)		(In thousands)
Outstanding at beginning of period		212	$	16.05
Exercised		--		--
Forfeited		--		--

Outstanding at end of period		212	$	16.05		4.68	$	3,769
Options exercisable at end of period		194	$	15.30		4.32	$	3,425

For the three months ended June 30, 2018 and 2017, compensation expense applicable to the stock options was $9 thousand and $53 thousand, respectively. There was no recognized tax benefit related to this expense for the period ended June 30, 2018. The recognized tax benefit related to this expense was $9 thousand for the period ended June 30, 2017.

For the six months ended June 30, 2018 and 2017, compensation expense applicable to the stock options was $19 thousand and $106 thousand, respectively. There was no recognized tax benefit related to this expense for the period ended June 30, 2018. The recognized tax benefit related to this expense was $19 thousand for the period ended June 30, 2017.

Unrecognized compensation expense for non-vested stock options totaled $51 thousand as of June 30, 2018, which will be recognized over the remaining weighted average vesting period of 1.3 years.

Stock Awards

There was no activity in non-vested restricted stock awards under the 2016 or the 2012 Equity Incentive Plan for the three and six months ended June 30, 2018.

For the three months ended June 30, 2018 and 2017, compensation expense applicable to the stock awards was $90 thousand and $113 thousand, respectively, and the recognized tax benefit related to this expense was $25 thousand and $45 thousand, respectively.

For the six months ended June 30, 2018 and 2017, compensation expense applicable to the stock awards was $188 thousand and $214 thousand, respectively, and the recognized tax benefit related to this expense was $53 thousand and $86 thousand, respectively.

Unrecognized compensation expense for non-vested restricted stock totaled $653 thousand as of June 30, 2018, which will be recognized over the remaining weighted average vesting period of 3.25 years.