NOTE 7 - EMPLOYEE AND DIRECTOR BENEFITS

Stock Incentive Plan

The Company had a stock incentive plan as described below. The compensation cost that has been charged to earnings for the plan was approximately $836,000 and $1.7 million for the three and six months ended June 30, 2025, respectively, and $879,000 and $1.8 million for the three and six months ended June 30, 2024, respectively.

The Company’s 2009 Amended and Restated Stock Incentive Plan authorizes the grant of up to 5,550,000 shares and allows for the issuance of Stock Appreciation Rights, Restricted Stock, Stock Options, Non-stock Share Equivalents, Performance Shares or Performance Units. The plan allows for the grant of incentive stock options and non-qualified stock options, and option awards are granted with an exercise price equal to the fair market value of the Company’s common stock at the date of grant. The maximum term of the options granted under the plan is ten years.

The following table summarizes stock option activity during the six months ended June 30, 2025 and 2024:

As of June 30, 2025, there were no unvested options.

Restricted Stock and Performance Shares

The Company periodically grants restricted stock awards that vest upon time-based service conditions. Dividend payments are made during the vesting period. The value of restricted stock is determined to be the current value of the Company’s stock, and this total value will be recognized as compensation expense over the vesting period. As of June 30, 2025, there was $6.1 million of total unrecognized compensation cost related to unvested time-based restricted stock. The cost is expected to be recognized evenly over the remaining 2.5 years of the restricted stock’s vesting period.

The Company periodically grants performance shares that give plan participants the opportunity to earn between 0% and 150% of the number of performance shares granted based on achieving certain performance metrics. The number of performance shares earned is determined by reference to the Company’s total shareholder return relative to a peer group of other publicly traded banks and bank holding companies during the performance period. The performance period is generally three years starting on the grant date. The fair value of performance shares are determined using a Monte Carlo simulation model on the grant date. As of June 30, 2025, there was $1.1 million of total unrecognized compensation cost related to unvested performance shares. As of June 30, 2025, non-vested performance shares had a weighted average remaining time to vest of 1.5 years.