Quarterly report pursuant to Section 13 or 15(d)

Note 6 - Employee and Director Benefits

v3.8.0.1
Note 6 - Employee and Director Benefits
 9 Months Ended
Sep. 30, 2017
Notes to Financial Statements  
Disclosure of Compensation Related Costs, Share-based Payments [Text Block]
NOTE
6
- EMPLOYEE AND DIRECTOR BENEFITS
 
Stock Options
 
At
September 30, 2017,
the Company had stock-based compensation plans, as described below. The compensation cost that has been charged to earnings for the plans was approximately
$294,000
and
$916,000
for the
three
and
nine
months ended
September 30, 2017,
respectively, and
$291,000
and
$931,000
for the
three
and
nine
months ended
September 30, 2016,
respectively.
 
The Company’s
2005
Amended and Restated Stock Option Plan allows for the grant of stock options to purchase up to
6,150,000
shares of the Company’s common stock. The Company’s
2009
Amended and Restated Stock Incentive Plan authorizes the grant of up to
5,550,000
shares and allows for the issuance of Stock Appreciation Rights, Restricted Stock, Stock Options, Performance Shares or Performance Units. Both plans allow for the grant of incentive stock options and non-qualified stock options, and option awards are granted with an exercise price equal to the market value of the Company’s common stock at the date of grant. The maximum term of the options granted under the plans is
ten
years.
 
The Company estimates the fair value of each stock option award using a Black-Scholes-Merton valuation model that uses the assumptions noted in the following table. These assumptions are highly subjective and changes to them can materially affect the fair value estimate. Expected market price volatility and expected term of options are based on historical data and other factors. The risk-free rate for periods within the contractual life of the option is based on the U. S. Treasury yield curve in effect at the time of grant.
 
    2017   2016
Expected volatility    
29.00
 %    
29.00
 %
Expected dividends    
0.44
 %    
0.64
 %
Expected term (in years)    
6.25
      
6.25
  
Risk-free rate    
2.08
 %    
1.86
 %
 
The weighted average grant-date fair value of options granted during the
nine
months ended
September 30, 2017
and
September 30, 2016
was
$11.83
and
$5.95,
respectively.
 
The following table summarizes stock option activity during the
nine
months ended
September 30, 2017
and
September 30, 2016:
 
    Shares   Weighted
Average
Exercise
Price
   Weighted
Average
Remaining
Contractual
Term (years)
   Aggregate
Intrinsic
Value
                (In Thousands)
Nine Months Ended September 30, 2017:                                
Outstanding at January 1, 2017    
2,026,334
     $
9.00
      
6.2
     $
57,636
  
Granted    
52,500
      
37.93
      
9.4
      
(35
 )
Exercised    
(359,000
 )    
4.97
      
4.2
      
11,590
  
Forfeited    
(32,000
 )    
21.96
      
8.4
      
489
  
Outstanding at September 30, 2017    
1,687,834
      
10.51
      
5.7
     $
45,136
  
                                 
Exercisable at September 30, 2017    
810,736
     $
5.22
      
4.2
     $
25,971
  
                                 
Nine Months Ended September 30, 2016:                                
Outstanding at January 1, 2016    
2,498,834
     $
6.66
      
6.3
     $
42,743
  
Granted    
234,000
      
19.98
      
9.5
      
1,398
  
Exercised    
(656,500
 )    
4.25
      
4.2
      
14,254
  
Forfeited    
(13,000
 )    
19.41
      
9.0
      
85
  
Outstanding at September 30, 2016    
2,063,334
      
8.86
      
6.5
     $
35,277
  
                                 
Exercisable at September 30, 2016    
594,536
     $
6.45
      
6.0
     $
13,901
  
 
As of
September 30, 2017,
there was approximately
$2.1
million of total unrecognized compensation cost related to non-vested stock options. The cost is expected to be recognized on the straight-line method over the next
2.7
years.
 
Restricted Stock
 
The Company periodically grants restricted stock awards that vest upon service conditions. Dividend payments are made during the vesting period. The value of restricted stock is determined to be the current value of the Company’s stock, and this total value will be recognized as compensation expense over the vesting period. As of
September 30, 2017,
there was
$543,000
of total unrecognized compensation cost related to non-vested restricted stock. The cost is expected to be recognized evenly over the remaining
1.2
years of the restricted stock’s vesting period.
 
The following table summarizes restricted stock activity during the
nine
months ended
September 30, 2017
and
September 30, 2016:
 
    Shares   Weighted
Average Grant
Date Fair Value
         
Nine Months Ended September 30, 2017:                
Non-vested at January 1, 2017    
118,676
     $
8.88
  
Granted    
7,000
      
38.02
  
Vested    
(4,200
 )    
15.74
  
Forfeited    
(800
 )    
15.74
  
Non-vested at September 30, 2017    
120,676
      
10.29
  
                 
Nine Months Ended September 30, 2016:                
Non-vested at January 1, 2016    
294,176
     $
6.44
  
Granted    
9,000
      
19.58
  
Vested    
(178,500
 )    
5.59
  
Forfeited    
-
      
-
  
Non-vested at September 30, 2016    
124,676
      
8.66