Note 13 - Stock-based Compensation

12 Months Ended

Dec. 31, 2022

Notes to Financial Statements

Share-Based Payment Arrangement [Text Block]

Note 13 – Stock-Based Compensation

The Company's 2018 Stock Incentive Plan (the "2018 Plan") provides for the granting of restricted stock awards, incentive and non-statutory options, and other equity-based awards to employees and directors at the discretion of the Compensation Committee of the Board of Directors. The 2018 Plan authorizes the issuance of up to 675,000 shares of common stock. 

Stock Options

Accounting guidance requires that compensation cost relating to share-based payment transactions be recognized in the financial statements with measurement based upon the fair value of the equity or liability instruments issued.

A summary of stock option transactions for the year ended December 31, 2022 is as follows:

						Weighted
				Weighted		Average		Aggregate
				Average		Remaining		Intrinsic
	Option			Exercise		Contractual Term		Value
	Shares			Price		(In Years)		($000)
Outstanding at December 31, 2021		4,863		$	16.63
Granted		—			—
Exercised		(713	)		16.63
Expired		—			—
Outstanding at December 31, 2022		4,150		$	16.63		1.97	$	84
Exercisable at December 31, 2022		4,150		$	16.63		1.97	$	84

The aggregate intrinsic value of stock options in the table above represents the total pre-tax intrinsic value (the amount by which the current fair 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, 2022. This amount changes based on changes in the fair value of the Company's common stock.

The total proceeds of the in-the-money options exercised during the years ended December 31, 2022, 2021, and 2020 were $12 thousand, $89 thousand, and $43 thousand, respectively. Total intrinsic value of options exercised during the years ended December 31, 2022, 2021, and 2020 was $16 thousand, $96 thousand, and $42 thousand, respectively.

There was no recognized or unrecognized stock compensation expense attributable to outstanding stock options at December 31, 2022 or 2021. 

No stock options were granted in 2022, 2021 or 2020.

Restricted Stock

The Company from time-to-time grants shares of restricted stock to key employees and non-employee directors. These awards help align the interests of these employees and directors with the interests of the shareholders of the Company by providing economic value directly related to increases in the value of the Company's common stock. The value of the stock awarded is established as the fair market value of the stock at the time of the grant. The Company recognizes expense, equal to the total value of such awards, ratably over the vesting period of the stock grants. Restricted stock granted in 2022 cliff vests at the end of a 36-month period beginning on the date of grant. Nonvested restricted stock activity for the year ended December 31, 2022 is summarized in the following table:

				Weighted
				Average Grant
	Shares			Date Value Per Share
Nonvested at December 31, 2021		58,461		$	31.71
Granted		33,363			35.18
Vested		(18,370	)		31.23
Forfeited		(1,747	)		34.12
Nonvested at December 31, 2022		71,707			33.39

As of December 31, 2022, 2021, and 2020, there was $1.1 million, $782 thousand, and $797 thousand, respectively, in unrecognized compensation cost related to nonvested restricted stock granted under the 2018 Plan. This cost is expected to be recognized over the next 12 to 36 months. The share-based compensation expense for nonvested restricted stock was $889 thousand, $749 thousand, and $672 thousand during 2022, 2021, and 2020, respectively.

The Company offers its outside directors alternatives with respect to director compensation. For 2022, 2021, and 2020 the regular quarterly board retainer could be received in the form of shares of immediately vested but restricted stock with a market value of $10,000. Monthly meeting fees could be received as $800 per meeting in cash or $1,000 in immediately vested but restricted stock. Only outside directors receive board fees. The Company issued 16,474, 20,474 and 27,986 shares and recognized share-based compensation expense of $603 thousand, $683 thousand, and $779 thousand during 2022, 2021 and 2020, respectively.