Note 10 - STOCK BASED COMPENSATION

ESOP

Employees participate in "the ESOP". The ESOP borrowed funds from the Company to purchase 330,465 shares of stock at $10 per share. The Association makes discretionary contributions to the ESOP and the ESOP uses funds it receives to repay the loan. When loan payments are made, ESOP shares are allocated to participants based on relative compensation. Participants receive the shares at the end of employment.

Each December, the Association makes discretionary contributions to the ESOP, which are equal to principal and interest payments required on the term loan. In December 2025, the Association made a discretionary contribution of $303,000 to the Company for payment on the loan. The ESOP compensation expense for nine months ending December 31, 2025 and 2024 was $154,000 and $118,000, respectively.

Fair value of unearned shares is based on a stock price of $16.92 and $14.96 as of December 31, 2025 and 2024, respectively.

Equity Incentive plan

At the Company's annual meeting of stockholders held on November 26, 2024, stockholders approved the Central Plains Bancshares, Inc. 2024 Equity Incentive Plan (“2024 Equity Plan”), which provides for the granting of up to 578,313 shares (165,232 shares of restricted stock and 413,081 stock options) of the Company’s common stock pursuant to equity awards made under the 2024 Equity Plan.

Stock options granted under the 2024 Equity Plan generally vest in equal annual installments over a service period of five years beginning one year from the date of grant. The vesting of the options accelerates upon death, disability or an involuntary termination at or following a change in control of the Company. Stock options are generally granted at an exercise price equal to the fair value of the Company’s common stock on the grant date based on the closing market price of the Company's common stock on the date of grant, and have an expiration period of ten years. As of December 31, 2025, the Company has 93,157 stock options available for future grants under the 2024 Equity Plan.

The Company recognizes compensation expense for the fair values of these awards, which have graded vesting, on a straight-line basis over the requisite service period of the awards. Upon exercise of vested options, management expects to first draw on retired stock as the source for shares.

The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value, the difference between the Company's closing stock price on the last trading day of the period and the exercise price, multiplied by the number of in-the-money options.

Expected future expense relating to the non-vested options outstanding as of December 31, 2025, is $1.4 million over a weighted average period of 4.0 years.

Restricted shares granted under the 2024 Equity Plan generally vest in equal annual installments over a service period of five years beginning one year from the date of grant. The vesting of the awards accelerates upon death, disability or an involuntary termination at or following a change in control of the Company. The product of the number of shares granted and the grant date closing market price of the Company’s common stock determines the fair value of restricted shares under the 2024 Equity Plan. Management recognizes compensation expense for the fair value of restricted shares on a straight-line basis over the requisite service period.

As of December 31, 2025, the Company has 28,367 shares of restricted stock available for future grants under the 2024 Equity Plan.

Expected future expense relating to the non-vested restricted shares outstanding as of December 31, 2025, is $1.6 million over a weighted average period of 4.0 years.