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Stock Compensation Plans
 3 Months Ended
Mar. 31, 2017
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Stock Compensation Plans

Note 13. Stock Compensation Plans

On May 13, 2014, the Company’s shareholders approved the First National Corporation 2014 Stock Incentive Plan, which makes available up to 240,000 shares of common stock for the granting of stock options, restricted stock awards, stock appreciation rights and other stock-based awards. Awards are made at the discretion of the Board of Directors and compensation cost equal to the fair value of the award is recognized over the vesting period.

Stock Awards

Whenever the Company deems it appropriate to grant a stock award, the recipient receives a specified number of unrestricted shares of employer stock. Stock awards may be made by the Company at its discretion without cash consideration and may be granted as settlement of a performance-based compensation award.

During the first quarter of 2017, the Company granted and issued 2,000 shares of common stock to the Chief Executive Officer for his individual performance and dedicated service to the Company. Compensation expense related to stock awards totaled $30 thousand for the three months ended March 31, 2017. The Company did not have compensation expense related to stock awards for the three months ended March 31, 2016.

Restricted Stock Units

Restricted stock units are an award of units that correspond in number and value to a specified number of shares of employer stock which the recipient receives according to a vesting plan and distribution schedule after achieving required performance milestones or upon remaining with the employer for a particular length of time. Each restricted stock unit that vests entitles the recipient to receive one share of common stock on a specified issuance date.

In the first quarter of 2017, 3,939 restricted stock units were granted to employees, with 1,317 units vesting immediately and 2,622 units subject to a two year vesting schedule with one half of the units vesting each year on the grant date anniversary. The recipient does not have any stockholder rights, including voting, dividend or liquidation rights, with respect to the shares underlying awarded restricted stock units until vesting has occurred and the recipient becomes the record holder of those shares. The unvested restricted stock units will vest on the established schedule if the employees remain employed by the Company on future vesting dates.

A summary of the activity for the Company’s restricted stock units for the period indicated is presented in the following table:

 

     March 31, 2017  
     Shares      Weighted
Average
Grant Date
Fair Value		  

Unvested, beginning of period

      10,259      $ 8.88  

Granted

      3,939        15.20  

Vested

      (8,536 )       9.89  

Forfeited

      —          —    
  

 

 

     

 

 

  

Unvested, end of period

      5,662      $ 11.76  
  

 

 

     

 

 

  

 

At March 31, 2017, based on restricted stock unit awards outstanding at that time, the total unrecognized pre-tax compensation expense related to unvested restricted stock unit awards was $60 thousand. This expense is expected to be recognized through 2019. Compensation expense related to restricted stock unit awards recognized for the three months ended March 31, 2017 and 2016 totaled $34 thousand and $40 thousand, respectively. As of March 31, 2017, the Company does not expect the forfeiture of any unvested restricted stock units.