Note

Benefit Plans

The Company has stock-based employee compensation plans, which are described in the Company’s

2018

Annual Report. The following tables below summarize transactions under the Company’s equity plans for the

nine

months ended

September 30, 2019:

Stock Options	Number of shares
	Incentive Stock Option			Non- Incentive Stock Option			Weighted Average Exercise Price

Balance outstanding as of January 1, 2019		12,500			5,000		$	5.14
Granted		-			-			-
Exercised		(9,000	)		(5,000	)		5.16
Forfeited		-			-			-
Balance outstanding as of September 30, 2019		3,500			-		$	5.08
Options exercisable as of September 30, 2019		3,500			-		$	5.08

The total intrinsic value of stock options exercised for the

nine

months ended

September 30, 2019

and

2018

was

$243,769

and

$267,366,

respectively. The total intrinsic value of outstanding stock options (including exercisable) was

$67,270

and

$452,100

September 30, 2019

and

2018,

respectively.

Restricted Stock	Number of Shares			Weighted Average Grant- Date Fair Value

Balance of shares non-vested as of January 1, 2019		32,349		$	18.93
Granted		15,434			23.85
Vested		(20,771	)		17.67
Forfeited		(1,649	)		22.27
Balance of shares non-vested as of September 30, 2019		25,363		$	22.74

March 2019,

the Company granted

5,502

shares of restricted stock to directors pursuant to the

2015

Equity Plan that have a cliff vesting at the end of

one

year and thus, expensed over that same period. These shares had a grant date market price of

$23.85

per share. The total amount of expense for restricted stock grants to directors (including all grants in previous years) during the

nine

months ended

September 30, 2019

and

2018

was

$97,241

and

$103,926,

respectively.

For the

nine

months ended

September 30, 2019

and

2018,

the Company granted

9,932

and

6,986

shares, respectively, of restricted stock to officers that have a cliff vesting at the end of

three

years. The expense is being recognized over the applicable vesting period. The total amount of expense for restricted stock grants to officers (including all grants in previous years) during the

nine

months ended

September 30, 2019

and

2018

was

$151,437

and

$135,810,

respectively.

Performance Stock Units	Performance Stock Units		Weighted Average Grant-Date Fair Value

Balance of shares non-vested as of January 1, 2019		47,322	$	20.48
Granted		-		-
Vested		-		-
Forfeited		-		-
Balance of shares non-vested as of September 30, 2019		47,322	$	20.48

March 29, 2017,

the Company granted restricted stock units representing

55,823

hypothetical shares of common stock to officers. There are

three

possible levels of incentive awards: threshold (

25%

); target (

50%

); and maximum (

100%

). The restricted stock units vest based on

two

financial performance factors over the period from

March 29, 2017

December 31, 2019 (

the “Performance Period”). The

two

performance measurements of the Company (and the weight given to each measurement) applicable to each award level are as follows: (i) Total Assets (

50%

) and (ii) Return on Average Assets (

50%

). In determining compensation expense, the fair value of the restricted stock unit awards was determined based on the closing price of the Company’s common stock on the date of grant, which was

$20.48

per share. The expense is being recognized over the applicable vesting period. Due to the fact that the measurements cannot be determined at the time of the grant, the Company currently estimates that the most likely outcome is the achievement between the target and maximum levels. If during the Performance Period, additional information becomes available to lead the Company to believe a different level will be achieved for the Performance Period, the Company will reassess the number of units that will vest for the grant and adjust its compensation expense accordingly on a prospective basis. The total amount of expense for restricted stock units during the

nine

months ended

September 30, 2019

and

2018

was

$290,568

and

$253,513,

respectively.

Total stock-based compensation expense recognized for the

nine

months ended

September 30, 2019

and

2018

was

$535,731

and

$493,249,

respectively. As of

September 30, 2019,

there was

$407,314

of unrecognized compensation expense related to non-vested restricted stock awards, which will be recognized over the remaining vesting period.