Note 10. Share-based Compensation

3 Months Ended

Mar. 31, 2016

Notes

Note 10. Share-based Compensation

10.          Share-Based Compensation

Total share-based compensation expense was $11,000 for both the three months ended March 31, 2016 and 2015.  Related tax benefits of $4,000 were recognized for both the three months ended March 31, 2016 and 2015.

Under the terms of the Company’s stock-based compensation plan, option exercise prices are equal to the quoted market price of the shares at the date of grant; option terms are ten years; and vesting periods range from three to four years.  The Company may also grant shares of restricted stock, stock appreciation rights and share-based performance awards.  Restricted shares are valued at the quoted market price of the shares at the date of grant, and have a three year vesting period.

Stock Options

The following table summarizes information regarding outstanding and exercisable options as of March 31, 2016:

		Outstanding		Exercisable
Number of options		57,780		48,891
Weighted average exercise price per share	$	8.49	$	8.24
Aggregate intrinsic value of options	$	490,000	$	403,000
Weighted average contractual term remaining		4.50 years		3.88 years

The Company’s stock option activity for the three months ended March 31, 2016 is as follows:

	No. of	Weighted
	Shares	Average
	Under	Exercise
	Option	Price
Balance, December 31, 2015	71,558	$	8.88
Exercised	(13,778)		10.52
Balance, March 31, 2016	57,780	$	8.49

No options were granted in 2016.

Compensation expense of $11,000 was recognized for both the three months ended March 31, 2016 and 2015 for the portion of the fair value of stock options vesting during that period.

As of March 31, 2016, there was approximately $29,000 of total unrecognized compensation expense related to non-vested options that will be recognized over the remaining requisite service periods.