NOTE 7 - EMPLOYEE AND DIRECTOR BENEFITS

Stock Incentive Plan

The Company has a stock incentive plan as described below. The compensation cost that has been charged to earnings for the plan was approximately $803,000 and $1.6 million for the three and six months ended June 30, 2026, respectively, and $836,000 and $1.7 million for the three and six months ended June 30, 2025, 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, 2026 and 2025:

As of June 30, 2026, there were no unvested options.

Restricted Stock and Performance Shares

The Company 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, 2026, there was $6.8 million of total unrecognized compensation cost related to unvested restricted stock. The cost is expected to be recognized evenly over the weighted average vesting period of 2.6 years for unvested restricted stock.

The Company 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 Compensation Committee determined that beginning with the grants in 2026, it would use the metrics of increase in tangible book value per share plus dividends, along with a relative TSR modifier, over a three-year performance period beginning on January 1st of the year of the grant to determine the number of performance shares earned. These metrics were used to make grants to the participants in early 2026. As of June 30, 2026, there was $2.0 million of total unrecognized compensation cost related to unvested performance shares. As of June 30, 2026, unvested performance shares had a weighted average remaining time to vest of 2.7 years.