Finward Bancorp Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Stock Based Compensation

Stock Based Compensation

6 Months Ended

Jun. 30, 2015

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

Note 10 - Stock Based Compensation

The Bancorp’s 2015 Stock Option and Incentive Plan (the Plan), which was adopted by the Bancorp’s Board of Directors on February 27, 2015 and approved by the Bancorp’s shareholders on April 24, 2015, permits the grant of equity awards for up to 250,000 shares of common stock. Awards granted under the Plan may be in the form of incentive stock options, non-qualified stock options, restricted stock, unrestricted stock, performance shares, or performance units. The Plan was adopted to replace the Bancorp’s 2004 Option Plan, which terminated on April 20, 2015. No further awards will be made under the 2004 Option Plan.

As required by the Stock Compensation Topic, companies are required to record compensation cost for stock options and awards provided to employees in return for employment service. For the six months ended June 30, 2015, stock based compensation expense of $47 thousand was recorded, compared to $30 thousand for the six months ended June 30, 2014. It is anticipated that current outstanding unvested options and awards will result in additional compensation expense of approximately $50 thousand in 2015 and $99 thousand in 2016.

There were no incentive stock options granted during the first six months of 2015 or 2014. When options are granted, the cost is measured at the fair value of the options when granted, and this cost is expensed over the employment service period, which is normally the vesting period of the options or awards.

A summary of incentive option activity under the Bancorp’s stock option and incentive plans described above for the six months ended June 30, 2015 follows:

				Weighted-
		Weighted-		Average
		Average		Remaining		Aggregate
		Exercise		Contractual		Intrinsic
Incentive options	Shares	Price		Term		Value
Outstanding at January 1, 2015	750	$	28.50
Granted	-		-
Exercised	-		-
Forfeited	-		-
Expired	-	$	-
Outstanding at June 30, 2015	750	$	28.50		2.7		-
Exercisable at June 30, 2015	750	$	28.50		2.7		-

There were 7,250 shares of restricted stock granted during the first six months of 2015 compared to 3,675 shares granted during the first six months of 2014. Restricted stock awards are issued with an award price equal to the market price of the Bancorp’s common stock on the award date and vests five years after the grant date. Forfeiture provisions exist for personnel that separate employment before the vesting period expires. A summary of restricted stock activity under the Bancorp’s incentive stock option and incentive plans described above for the six months ended June 30, 2015 follows:

		Weighted-
		Average
		Grant Date
Restricted stock	Shares	Fair Value
Nonvested at January 1, 2015	12,775	$	23.63
Granted	7,250		27.50
Vested	(300)		16.75
Forfeited	-		-
Nonvested at June 30, 2015	19,725	$	25.15