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Note 7 - Employee and Director Benefits | 3 Months Ended
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Mar. 31, 2024
Notes to Financial Statements |
Share-Based Payment Arrangement [Text Block] | NOTE 7 - EMPLOYEE AND DIRECTOR BENEFITS Stock Incentive Plan At March 31, 2024, the Company had a stock incentive plan as described below. The compensation cost that has been charged to earnings for the plan was approximately $958,000 and $808,000 for the three months ended March 31, 2024 and 2023, respectively. 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, Non-stock Share Equivalents, Performance Shares or Performance Units. The plan allows for the grant of incentive stock options and non-qualified stock options, and option awards are granted with an exercise price equal to the fair market value of the Company’s common stock at the date of grant. The maximum term of the options granted under the plan is ten years. The Company estimates the fair value of each stock option award using a Black-Scholes-Merton valuation model. Expected volatilities are based on the Company’s trading price history. The expected term for options granted is based on the short-cut method and represents the period of time that options granted are expected to be outstanding. 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. There were no grants of stock options during first quarters of 2024 and 2023. The following table summarizes stock option activity during the three months ended March 31, 2024 and 2023:
|  |  |  |  |  |  |  |  |  | Weighted |  |  |  |  |
|  |  |  |  |  | Weighted |  |  | Average |  |  |  |  |
|  |  |  |  |  | Average |  |  | Remaining |  |  |  |  |
|  |  |  |  |  | Exercise |  |  | Contractual |  |  | Aggregate |
|  | Shares |  |  | Price |  |  | Term (years) |  |  | Intrinsic Value |
|  |  |  |  |  |  |  |  |  |  |  |  |  | (In Thousands) |
Three Months Ended March 31, 2024: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Outstanding January 1, 2024 |  |  | 165,800 |  |  | $ | 24.35 |  |  |  | 2.9 |  |  | $ | 7,211 |
Exercised |  |  | (8,300 | ) |  |  | 15.74 |  |  |  | 0.9 |  |  |  | 420 |
Outstanding March 31, 2024 |  |  | 157,500 |  |  | $ | 24.80 |  |  |  | 2.7 |  |  | $ | 6,744 |
Exercisable March 31, 2024 |  |  | 140,000 |  |  | $ | 22.63 |  |  |  | 2.1 |  |  | $ | 6,122 |
Three Months Ended March 31, 2023: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Outstanding January 1, 2023 |  |  | 280,000 |  |  | $ | 19.43 |  |  |  | 3.0 |  |  | $ | 14,088 |
Exercised |  |  | (75,000 | ) |  |  | 10.80 |  |  |  | 0.9 |  |  |  | 3,288 |
Outstanding March 31, 2023 |  |  | 205,000 |  |  | $ | 22.59 |  |  |  | 3.4 |  |  | $ | 7,428 |
Exercisable March 31, 2023 |  |  | 152,000 |  |  | $ | 17.28 |  |  |  | 2.2 |  |  | $ | 5,859 |
As of March 31, 2024, there was $35,000 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 six months. Restricted Stock and Performance Shares The Company periodically grants restricted stock awards that vest upon time-based 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 March 31, 2024, there was $5.3 million of total unrecognized compensation cost related to non-vested time-based restricted stock. The cost is expected to be recognized evenly over the remaining 1.8 years of the restricted stock’s vesting period. The Company periodically grants performance shares that give plan participants the opportunity to earn between 0% and 150% of the number of performance shares granted based on achieving certain performance metrics. The number of performance shares earned is determined by reference to the Company’s total shareholder return relative to a peer group of other publicly traded banks and bank holding companies during the performance period. The performance period is generally three years beginning on January 1st of the year of the grant. The fair value of performance shares is determined using a Monte Carlo simulation model on the grant date. As of March 31, 2024, there was $1.2 million of total unrecognized compensation cost related to non-vested performance shares. As of March 31, 2024, non-vested performance shares had a weighted average remaining time to vest of 2.1 years.
|  | Restricted Stock |  |  | Performance Shares |
|  | Shares |  |  | Weighted Average Grant Date Fair Value |  |  | Shares |  |  | Weighted Average Grant Date Fair Value |
Three Months Ended March 31, 2024: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Non-vested at January 1, 2024 |  |  | 158,298 |  |  | $ | 58.08 |  |  |  | 31,944 |  |  | $ | 58.25 |
Granted |  |  | 21,835 |  |  |  | 67.12 |  |  |  | 8,894 |  |  |  | 67.90 |
Additional performance share attainment |  |  | - |  |  |  | - |  |  |  | 6,216 |  |  |  | 68.18 |
Vested |  |  | (25,107 | ) |  |  | 48.19 |  |  |  | (18,653 | ) |  |  | 37.05 |
Forfeited |  |  | (576 | ) |  |  | 71.43 |  |  |  | - |  |  |  | - |
Non-vested at March 31, 2024 |  |  | 154,450 |  |  | $ | 60.92 |  |  |  | 28,401 |  |  | $ | 77.37 |
Three Months Ended March 31, 2023: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Non-vested at January 1, 2023 |  |  | 141,580 |  |  | $ | 56.39 |  |  |  | 23,852 |  |  | $ | 54.16 |
Granted |  |  | 27,258 |  |  |  | 69.83 |  |  |  | 8,091 |  |  |  | 70.29 |
Vested |  |  | (17,521 | ) |  |  | 48.32 |  |  |  | - |  |  |  | - |
Forfeited |  |  | (6,545 | ) |  |  | 69.90 |  |  |  | - |  |  |  | - |
Non-vested at March 31, 2023 |  |  | 144,772 |  |  | $ | 59.29 |  |  |  | 31,943 |  |  | $ | 58.25 |

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