Stock-Based Compensation

3 Months Ended

Mar. 31, 2013

Stock-Based Compensation [Abstract]

Stock-Based Compensation

Note 2 – Stock-Based Compensation

CTBI's compensation expense related to stock option grants was $3 thousand and $19 thousand for the three months ended March 31, 2013 and 2012, respectively. Restricted stock expense for the first three months of 2013 and 2012 was $161 thousand and $157 thousand, respectively, including $31 thousand and $30 thousand, respectively, in dividends paid for each period. As of March 31, 2013, there was a total of $17 thousand of unrecognized compensation expense related to unvested stock option awards that will be recognized as expense as the awards vest over a weighted average period of 1.6 years and a total of $1.3 million of unrecognized compensation expense related to restricted stock grants that will be recognized as expense as the awards vest over a weighted average period of 1.5 years.

There were 10,822 shares and 331 shares of restricted stock granted during the three months ended March 31, 2013 and 2012. The restrictions on the restricted stock granted in 2013 and 2012 will lapse over four years. However, in the event of a change in control of CTBI or the death of the participant, the restrictions will lapse. In the event of the disability of the participant, the restrictions will lapse on a pro rata basis. The Compensation Committee of the Board of Directors will have discretion to review and revise restrictions applicable to a participant's restricted stock in the event of the participant's retirement. There were 1,500 options granted to purchase shares of CTBI common stock during the three months ended March 31, 2013. There were no options granted to purchase shares of CTBI common stock during the three months ended March 31, 2012.

The fair values of options granted during the three months ended March 31, 2013, were established at the date of grant using a Black-Scholes option pricing model with the weighted average assumptions as follows:

	Three Months Ended
	March 31
	2013
Expected dividend yield		3.74	%
Risk-free interest rate		1.33	%
Expected volatility		39.11	%
Expected term (in years)		7.5
Weighted average fair value of options	$	9.05