FARMERS NATIONAL BANC CORP /OH/ Stock Compensation Disclosure

NOTE 15 – STOCK BASED COMPENSATION

 

In April of 2022, the Company, with the approval of shareholders, created the 2022 Equity Incentive Plan (the “2022 Plan”). The 2022 Plan permits the award of up to one million shares to the Company’s directors and employees to attract and retain exceptional personnel, motivate performance and, most importantly, to help align the interests of the Company’s executives with those of the Company’s shareholders. There were 93,080 service time based share awards and 102,336 performance based share awards granted under the 2022 Plan during the year ended December 31, 2025, as shown in the table below. The actual number of performance based shares issued will depend on the relative performance of the Company’s average return on equity compared to a group of peer companies over a three year vesting period, ending December 31, 2027. As of December 31, 2025, 352,265 shares are still available to be awarded from the 2022 Plan. 

 

The restricted stock awards were granted with a fair value price equal to the market price of the Company’s common stock at the date of the grant. Expense recognized was $2.5 million for 2025 and $2.6 million for 2024 and 2023, respectively. As of December 31, 2025, there was $2.7 million of total unrecognized compensation expense related to the nonvested shares granted under the Plan. The remaining cost is expected to be recognized over 2.2 years.

 

The following is the activity under the Plan during 2025:

 

						Weighted				Maximum				Weighted
		Maximum				Average				Awarded				Average
		Awarded				Grant Date				Performance				Grant Date
		Service Units				Fair Value				Units				Fair Value
Beginning balance - non-vested shares			231,430				14.35				222,920				14.57
Granted			93,080				13.82				102,336				14.38
Vested			(145,833	)			14.02				(47,514	)			14.06
Forfeited			(1,762	)			12.44				(8,085	)			12.44
Ending balance - non-vested shares			176,915			$	13.77				269,657			$	14.13

 

The following is the activity under the Plan during 2024:

 

						Weighted				Maximum				Weighted
		Maximum				Average				Awarded				Average
		Awarded				Grant Date				Performance				Grant Date
		Service Units				Fair Value				Units				Fair Value
Beginning balance - non-vested shares			253,776				14.97				209,484				15.01
Granted			87,925				13.28				99,253				13.81
Vested			(93,104	)			12.79				(66,192	)			13.79
Forfeited			(17,167	)			16.01				(19,625	)			15.05
Ending balance - non-vested shares			231,430			$	14.35				222,920			$	14.57

 

The 193,347 shares that vested in 2025 had a weighted average fair value of $14.03 per share. The total fair value of shares vested during the years ended December 31, 2025, 2024 and 2023 was $2.7 million, $2.1 million and $969,000, respectively.