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Note 12 - Employee Benefit Plans

12 Months Ended

Dec. 31, 2024

Notes to Financial Statements

Compensation and Employee Benefit Plans [Text Block]

Note 12. Employee Benefit Plans

Defined Benefit Plans

The Company maintains two nonqualified domestic, noncontributory defined benefit plans (the “Benefit Plans”) for key members of senior management and non-management directors. The Company’s unfunded Benefit Plans include the Supplemental Executive Retention Plan (“SERP”) and the Directors’ Supplemental Retirement Plan (“Directors’ Plan”). The SERP provides for a defined benefit, at normal retirement age, targeted at 35% of the participant’s projected final average compensation, subject to a defined maximum annual benefit. Benefits under the SERP generally become payable at age 62. The Directors’ Plan provides for a defined benefit, at normal retirement age, up to 100% of the participant’s highest consecutive three-year average compensation. Benefits under the Directors’ Plan generally become payable at age 70. The SERP was frozen near the end of 2021; the Directors' Plan was fundamentally frozen at that time as well. The following table presents the changes in the aggregate actuarial benefit obligation for the two plans combined during the periods indicated:

		*December 31,*
		*2024*				*2023*
(Amounts in thousands)
Beginning balance		$	9,050			$	9,488
Effect of curtailment			—				—
Service cost			—				—
Interest cost			414				451
Actuarial gain			(440	)			(306	)
Benefits paid			(583	)			(583	)
Ending balance		$	8,441			$	9,050

The following table presents the components of net periodic pension cost, the effect on the consolidated statements of income, and the assumed discount rate for the periods indicated:

		*Year Ended December 31,*
		*2024*				*2023*				*2022*			*Income Statement Location*
(Amounts in thousands)
Service cost		$	—			$	—			$	—		Salaries and employee benefits
Interest cost			414				451				332		Other expense
Effect of curtailment			—				—				—		Salaries and employee benefits
Amortization of prior service cost			—				—				—		Other expense
Amortization of losses			37				38				135		Other expense
Net periodic cost		$	451			$	489			$	467

Assumed discount rate			5.35	%			4.79	%			4.96	%

The following schedule presents the projected benefit payments to be paid under the Benefit Plans, by year, as of December 31, 2024:

(Amounts in thousands)
2025		$	731
2026			823
2027			793
2028			755
2029			714
2030 through 2034			3,459

Deferred Compensation Plan

The Company maintains deferred compensation agreements with certain current and former officers that provide benefit payments, over various periods, commencing at retirement or death. There were no accrued benefits, which are based on the present values of expected payments and estimated life expectancies, as of December 31, 2024 or 2023. There was no deferred compensation plan expense in 2024, 2023, or 2022.

The Company maintains a deferred compensation plan, referred to as the WRAP, and is a voluntary, non-tax qualified deferred compensation plan available to certain employees, including executive officers. Under the plan, participants may defer a portion of their base and/or annual incentive compensation. The plan is intended to mirror the Corporation's qualified KSOP, and may include discretionary match that coincides with a match made to the KSOP to the extent participants cannot otherwise receive the full match in the KSOP. The balance as of December 31, 2024 and 2023 was $8.73 million and $8.28 million, respectively.

Employee Welfare Plan

The Company provides various medical, dental, vision, life, accidental death and dismemberment, and long-term disability insurance benefits to all full-time employees who elect coverage under this program. A third-party administrator manages the health plan. Monthly employer and employee contributions are made to a tax-exempt employee benefits trust where the third-party administrator processes and pays claims. As of December 31, 2024, stop-loss insurance coverage generally limits the Company’s risk of loss to $200 thousand for individual claims and $5.56 million for aggregate claims. Health plan expenses were $4.10 million in 2024, $4.16 million in 2023, and $4.04 million in 2022.

Employee Stock Ownership and Savings Plan

The Company maintains the Employee Stock Ownership and Savings Plan (“KSOP”) that consists of a 401(k) savings feature that covers all employees that meet minimum eligibility requirements. The Company matches employee contributions at levels determined by the Board of Directors annually. These contributions are made in the first quarter following each plan year and employees must be employed on the last day of the plan year to be eligible. Matching contributions to qualified deferrals under the 401(k) savings component of the KSOP totaled $1.89 million in 2024, $1.76 million in 2023, and $1.82 million in 2022. The KSOP held 266,533 shares of the Company’s common stock as of December 31, 2024, 282,072 shares as of December 31, 2023, and 309,019 shares as of December 31, 2022.

Equity-Based Compensation Plans

The Company maintains equity-based compensation plans to promote the long-term success of the Company by encouraging officers, employees, directors, and other individuals performing services for Company to focus on critical long-range objectives. The Company’s most current equity-based compensation plans include the 2022 Omnibus Equity Compensation Plan (the “2022 Plan”), which authorized 1,000,000 shares for potential grants of Non-Qualified Stock Options, Incentive Stock Options, Performance Shares, Performance Stock Units, Restricted Stock, Restricted Stock Units, and Performance Awards. The Company’s Compensation and Retirement Committee determines the vesting period for each grant; however, awards shall have a minimum vesting/exercise schedule of at least one year, except that a shorter vesting/exercise schedule may apply to not more than 5% of the shares authorized for issuance under the 2022 Plan.

The following table presents the pre-tax compensation expense and excess tax benefit recognized in earnings for all equity-based compensation plans for the periods indicated:

		*Year Ended December 31,*
		*2024*				*2023*				*2022*
(Amounts in thousands)
Pre-tax compensation expense		$	403			$	597			$	718
Excess tax (benefit) expense			(227	)			(167	)			(68	)

Stock Options

The following table presents stock option activity and related information for the year ended December 31, 2024:

(Amounts in thousands, except share and per share data)		*Option Shares*				*Weighted Average Exercise Price Per Share*				*Weighted Average Remaining Contractual Term (Years)*				*Aggregate Intrinsic Value*

Outstanding, January 1, 2024			186,264			$	29.72
Granted			—				—
Exercised			(51,088	)			27.61
Canceled/Expired			(4,536	)			22.58
Outstanding, December 31, 2024			130,640			$	30.79				5.49			$	1,417
Exercisable, December 31, 2024			130,640			$	30.79				5.49			$	1,417

There were no options granted in 2024. There were 51,088 options exercised in 2024 and 4,288 options exercised in 2023. The intrinsic value of options exercised was $832 thousand in 2024, and $58 thousand in 2023. As of December 31, 2024, there was no unrecognized compensation cost related to nonvested stock options.

Restricted Stock and Stock Unit Awards

The following table presents restricted stock activity and related information for the year ended December 31, 2024:

		*Shares/Units*				*Weighted Average Grant-Date Fair Value*

Nonvested, January 1, 2024			108,993			$	37.10
Granted			59,484				33.99
Vested			(16,648	)			35.00
Canceled			(708	)			41.55
Nonvested, December 31, 2024			151,121			$	36.09

As of December 31, 2024, unrecognized compensation cost related to nonvested restricted stock/unit awards totaled $2.47 million with an expected weighted average recognition period of 1.91 years. The actual compensation cost recognized might differ from this estimate due to various items, including new awards granted and changes in estimated forfeitures.