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STOCK PLANS AND STOCK-BASED COMPENSATION

9 Months Ended

Dec. 31, 2024

STOCK PLANS AND STOCK-BASED COMPENSATION

STOCK PLANS AND STOCK-BASED COMPENSATION

3. STOCK PLANS AND STOCK-BASED COMPENSATION

Stock Option Plans - In July 2003, shareholders of the Company approved the adoption of the 2003 Stock Option Plan (“2003 Plan”). The 2003 Plan was effective in July 2003 and expired in July 2013. Accordingly, no further option awards may be granted under the 2003 Plan. Further, no options granted under the 2003 plan remain outstanding as of December 31, 2024, with all such awards having been either previously exercised or forfeited. Each option granted under the 2003 Plan had an exercise price equal to the fair value of the Company’s common stock on the date of the grant, a maximum term of ten years and a vesting period from zero to five years.

In July 2017, the shareholders of the Company approved the Riverview Bancorp, Inc. 2017 Equity Incentive Plan (“2017 Plan”). The 2017 Plan provides for the grant of incentive stock options, non-qualified stock options, restricted stock and restricted stock units. The Company reserved 1,800,000 shares of its common stock for issuance under the 2017 Plan. At December 31, 2024, there were 1,308,215 shares available for grant under the 2017 Plan. The 2003 Plan and the 2017 Plan are collectively referred to as “the Stock Option Plans”.

The fair value of each stock option granted is estimated on the date of grant using the Black-Scholes stock option valuation model. The fair value of all awards is amortized on a straight-line basis over the requisite service periods, which are generally the vesting periods. The expected life of options granted represents the period of time that they are expected to be outstanding. The expected life is determined based on historical experience with similar options, considering the contractual terms and vesting schedules. Expected volatility is estimated at the date of grant based on the historical volatility of the Company's common stock. Expected dividends are based on dividend trends and the market value of the Company's common stock at the time of grant. The risk-free interest rate for periods within the contractual life of the

options is based on the U.S. Treasury yield curve in effect at the time of the grant. There were no stock options granted under the 2017 Stock Option Plan during the nine months ended December 31, 2024 and 2023.

As of December 31, 2024, all outstanding stock options were fully vested and there was no remaining unrecognized compensation expense related to stock options granted under the Stock Option Plans. There was no stock-based compensation expense related to stock options for the nine months ended December 31, 2024 and 2023 under the Stock Option Plans.

There was no activity related to stock options for the nine months ended December 31, 2024. The following table presents the activity related to stock options under the Stock Option Plans for the nine months ended December 31, 2023:


		Nine Months Ended December 31,
		2023
				Weighted
				Average
		Number of		Exercise
		Shares		Price
Balance, beginning of period		14,310		$	2.78
Options exercised		(12,799)			2.78
Options expired		(1,511)			2.78
Balance, end of period		—		$	—

There were no stock options outstanding as of December 31, 2024 and 2023.

There was no intrinsic value of stock options exercised for the nine months ended December 31, 2024. The total intrinsic value of stock options exercised was $28,000 for the nine months ended December 31, 2023, under the Stock Option Plans.

The Company may grant restricted stock pursuant to the 2017 Plan of which vesting can either be time based or performance based. Performance based awards are subject to attaining certain performance metrics and all, or a portion of, the performance based awards can subsequently be cancelled for not attaining the predetermined performance metrics. The fair value of restricted stock awards is equal to the fair value of the Company’s stock on the date of grant. The related stock-based compensation expense is recorded over the requisite service period. Stock-based compensation related to restricted stock grants was $264,000 and $19,000 for the three months ended December 31, 2024 and 2023, respectively. Stock-based compensation related to restricted stock grants was $316,000 and $11,000 for the nine months ended December 31, 2024 and 2023, respectively. The increase in the stock-based compensation expense was due to there being no net restricted stock forfeitures for the three and nine months ended December 31, 2024 compared to the reversal of stock-based compensation expense related to restricted stock forfeited for the three and nine months ended December 31,2023 totaling $26,000 and $238,000, respectively. The unrecognized stock-based compensation related to restricted stock was $1.2 million and $267,000 at December 31, 2024 and 2023, respectively. The weighted average vesting period for the restricted stock was 2.68 years and 1.51 years at December 31, 2024 and 2023, respectively.

A summary of changes in nonvested restricted stock awards for the periods shown:


		Time Based					Performance Based					Total
		Number		Weighted			Number		Weighted			Number		Weighted
		of		Average			of		Average			of		Average
		Unvested		Grant Date			Unvested		Grant Date			Unvested		Grant Date
Nine Months Ended December 31, 2024		Shares		Fair Value			Shares		Fair Value			Shares		Fair Value
Balance, beginning of period		15,779		$	5.72		63,397		$	5.68		79,176		$	5.69
Granted		147,462			5.76		90,401			5.76		237,863			5.76
Forfeited		—			—		(14,075)			5.21		(14,075)			5.21
Vested		(7,281)			6.08		(16,393)			6.73		(23,674)			6.53
Balance, end of period		155,960		$	5.74		123,330		$	5.65		279,290		$	5.70


		Time Based					Performance Based					Total
		Number		Weighted			Number		Weighted			Number		Weighted
		of		Average			of		Average			of		Average
		Unvested		Grant Date			Unvested		Grant Date			Unvested		Grant Date
Nine Months Ended December 31, 2023		Shares		Fair Value			Shares		Fair Value			Shares		Fair Value
Balance, beginning of period		29,977		$	6.14		132,645		$	6.05		162,622		$	6.07
Granted		19,926			5.21		84,040			5.21		103,966			5.21
Forfeited		(19,006)			5.81		(99,514)			5.94		(118,520)			5.92
Vested		(15,118)			5.77		(53,774)			5.38		(68,892)			5.47
Balance, end of period		15,779		$	5.72		63,397		$	5.68		79,176		$	5.69