What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2022-05-06 compared with 2021-11-05 · 370 added, 540 removed, 825 unchanged (52% of the section changed)

Financial Statements

Financial Group, Inc.

Consolidated Balance Sheets

SB Financial Group, Inc.

Condensed Consolidated Balance Sheets

($ in thousands)

7 unchanged sentences

Federal Reserve and Federal Home Loan Bank Stock, at cost

Foreclosed assets held for sale, net

Foreclosed assets and other assets held for sale, net

Interest receivable

6 unchanged sentences

Total deposits

Short-term borrowings

Repurchase agreements

Federal Home Loan Bank advances

14 unchanged sentences

Retained earnings

Accumulated other comprehensive income (loss)

Accumulated other comprehensive loss

Treasury stock, at cost;

2 unchanged sentences

Total liabilities and shareholders’ equity

notes to condensed consolidated financial statements (unaudited)

The balance sheet at December 31, 2020 has been derived from the audited consolidated financial statements at that date.

Financial Group, Inc.

See notes to condensed consolidated financial statements (unaudited)

The balance sheet at December 31, 2021 has been derived

from the audited consolidated financial statements at that date.

SB Financial Group, Inc.

Consolidated Income Statement (unaudited)

($ in thousands, except per share data)

Three Months Ended

Interest Income

Total interest income

15 unchanged sentences

Title insurance income

Gain (loss) on sale/disposal of assets

Total noninterest income

10 unchanged sentences

Employee expense

Other expenses

Other expense

Total noninterest expense

1 unchanged sentence

Provision for income taxes

Net income available to common shareholders

Basic earnings per common share

Diluted earnings per common share

Average common shares outstanding (in thousands):

notes to condensed consolidated financial statements (unaudited)

Financial Group, Inc.

Consolidated Statements of Comprehensive Income (unaudited)

See notes to condensed consolidated

financial statements (unaudited)

Condensed Consolidated Statements of Comprehensive

Income (Loss) (unaudited)

Three Months Ended

($ in thousands)

Other comprehensive income (loss), net of tax:

Net unrealized holding gain (loss) on securities available-for-sale

Related income tax effect

Other comprehensive income (loss), net of tax

Total comprehensive income

notes to condensed consolidated financial statements (unaudited)

Financial Group, Inc.

Other comprehensive loss

Available for sale investment securities:

Gross unrealized holding loss arising in the period

Related tax benefit

Net effect on other comprehensive loss

Total comprehensive income (loss)

See notes to condensed consolidated financial statements (unaudited)

Consolidated Statements of Shareholders’ Equity (unaudited)

($ in thousands, except per share data)

Preferred Stock

Additional Paid-in

Retained Earnings

Accumulated Other Comprehensive Income (Loss)

Treasury Stock

Accumulated Other Comprehensive

($ in thousands, except per share

January 1, 2022

Other comprehensive loss

Dividends on common, $ 0.105 per share

Restricted stock vesting

Repurchased stock ( 142,094 shares)

Stock based compensation expense

Balance, March 31, 2021

Other comprehensive income

Dividends on common, $ 0.11 per share

Repurchased stock ( 215,097 shares)

Stock based compensation expense

Balance, June 30, 2021

Other comprehensive (loss)

Dividends on common, $ 0.11 per share

Stock dividends on common - 344,663 shares

Cash dividends on common, $ 0.115 per share

Restricted stock vesting

1 unchanged sentence

Stock based compensation expense

Balance, September 30, 2021

March 31, 2022

Accumulated Other Comprehensive

($ in thousands, except per share data)

Preferred Stock

Additional Paid-in

Retained Earnings

Accumulated Other Comprehensive Income

Treasury Stock

January 1, 2021

Other comprehensive income

Dividends on common, $ 0.095 per share

Restricted stock vesting

Stock options exercised

Repurchased stock ( 98,609 shares)

Stock based compensation expense

Balance, March 31, 2020

Other comprehensive income

Dividends on common, $ 0.10 per share

Repurchased stock ( 90,762 shares)

Stock based compensation expense

Balance, June 30, 2020

Other comprehensive loss

Dividends on common, $ 0.10 per share

Cash dividends on common, $ 0.105 per share

Restricted stock vesting

1 unchanged sentence

Stock based compensation expense

Balance, September 30, 2020

notes to condensed consolidated financial statements (unaudited)

Financial Group, Inc.

Consolidated Statements of Cash Flows (unaudited)

March 31, 2021

See notes to condensed consolidated financial statements (unaudited)

SB Financial Group, Inc.

Condensed Consolidated Statements of Cash

Flows (unaudited)

($ in thousands)

September 30,

Three Months Ended

Operating Activities

10 unchanged sentences

Gain from sale of loans

Loss on sales of assets

Interest receivable

Interest payable & other liabilities

Net cash provided by operating activities

Net cash used in operating activities

Investing Activities

5 unchanged sentences

Purchase of bank owned life insurance

Purchase of Federal Reserve and Federal Home Loan Bank Stock

Proceeds from sale of foreclosed assets

Acquisition, net of cash acquired

Net cash used in investing activities

Financing Activities

Net increase in demand deposits, money market, interest checking & savings accounts

Net increase in demand deposits, money market, interest checking &

savings accounts

Net decrease in time deposits

Net increase in short term borrowings

Repayment of Federal Home Loan Bank advances

Net proceeds from subordinated debt

Net proceeds from share-based compensation plans

Net increase in securities sold under agreements to repurchase

Stock repurchase plan

6 unchanged sentences

Interest paid

Income taxes paid

Supplemental non-cash disclosure

Transfer of loans to foreclosed assets

In conjunction with the Edon acquisition, liabilities assumed were:

Fair value of assets acquired

Cash paid in acquisition

Liabilities assumed

Stock dividends declared and paid

See notes to condensed consolidated financial statements (unaudited)

SB FINANCIAL GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

FINANCIAL GROUP, INC.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1—BASIS OF PRESENTATION

Financial Group, Inc., an Ohio corporation (the “Company”), is a financial holding company whose principal activity is the

ownership and management of its wholly-owned subsidiaries, including The State Bank and Trust Company (“State Bank”), SBFG

Title, LLC (“Title”), SB Captive, Inc.

(“Captive”), RFCBC, Inc.

(“RFCBC”), Rurbanc Data Services,

dba RDSI Banking Systems (“RDSI”), and Rurban Statutory Trust II (“RST II”).

RDSI is presently inactive

and has had no material operations or employees since January 1, 2018.

In addition, State Bank owns all of the outstanding stock of Rurban

Mortgage Company (“RMC”), which is inactive, and State Bank Insurance, LLC (“SBI”).

June 2020, the Company acquired Edon Bancorp and its subsidiary, The Edon State Bank Company of Edon, Ohio (collectively, “Edon”),

which were merged with and into the Company and State Bank, respectively.

This acquisition was completed effective June 5, 2020, and

the acquisition resulted in an increase in goodwill, which is detailed in Note 8.

The business combination summary is detailed in Note

consolidated financial statements include the accounts of the Company, State Bank, RFCBC, RDSI, RMC, SBT Title, SB Captive and SBI.

significant intercompany accounts and transactions have been eliminated in consolidation.

accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting

principles for interim financial information and with the instructions for Form 10-Q.

Accordingly, they do not include all of the information

and footnotes required by generally accepted accounting principles for complete financial statements.

The financial statements reflect

all adjustments that are, in the opinion of management, necessary to fairly present the financial position, results of operations and

cash flows of the Company.

Those adjustments consist only of normal recurring adjustments.

Results of operations for the three and nine

months ended September 30, 2021, are not necessarily indicative of results for the complete year.

condensed consolidated balance sheet of the Company as of December 31, 2020 has been derived from the audited consolidated balance sheet

of the Company as of that date.

further information, refer to the consolidated financial statements and footnotes included in the Company’s Annual Report on Form

10-K for the year ended December 31, 2020.

and applicable accounting pronouncements:

Investments – Equity Securities (Topic 321), Investments – Equity Method and Joint Ventures (Topic 323), and

Derivatives and Hedging (Topic 815) – Clarifying the Interactions between Topic 321, Topic 323 and Topic 815

guidance was issued in January 2020 to clarify that a company should consider observable transactions that require a company to either

apply or discontinue the equity method of accounting under Topic 323, Investments-Equity Method and Joint Ventures, for the purposes

of applying the measurement alternative in accordance with Topic 321 immediately before applying or upon discontinuing the equity method.

The amendments also clarify that when determining the accounting for certain forward contracts and purchased options a company should

not consider, whether upon settlement or exercise, if the underlying securities would be accounted for under the equity method or fair

value option.

The guidance is effective beginning after December 15, 2020.

The impact of this new guidance did not have a material impact

on the Company’s consolidated financial statements.

Standards not yet adopted:

Reference Rate Reform – Facilitation of the Effects of Reference Rate Reform on Financial Reporting (Topic 848)

guidance provides temporary options to ease the potential burden in accounting for reference rate reform.

It is intended to help stakeholders

during the global market-wide reference rate transition period.

NOTE 1—BASIS OF PRESENTATION

SB Financial Group, Inc., an Ohio corporation

(the “Company”), is a financial holding company whose principal activity is the ownership and management of its wholly-owned

subsidiaries, including The State Bank and Trust Company (“State Bank”), SBFG Title, LLC (“SBFG Title”), SB Captive,

(“SB Captive”), RFCBC, Inc.

(“RFCBC”), Rurbanc Data Services, Inc.

dba RDSI Banking Systems (“RDSI”),

and Rurban Statutory Trust II (“RST II”).

RDSI is presently inactive and has had no material operations or employees.

State Bank owns all of the outstanding stock of Rurban Mortgage Company (“RMC”), which is inactive, and State Bank Insurance,

The consolidated financial statements include

the accounts of the Company, State Bank, RFCBC, RDSI, RMC, SBFG Title, SB Captive and SBI.

All significant intercompany accounts and transactions

have been eliminated in consolidation.

The accompanying unaudited condensed consolidated

financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information

and with the instructions for Form 10-Q.

Accordingly, they do not include all of the information and footnotes required by generally accepted

accounting principles for complete financial statements.

The financial statements reflect all adjustments that are, in the opinion of

management, necessary to fairly present the financial position, results of operations and cash flows of the Company.

Those adjustments

consist only of normal recurring adjustments.

Results of operations for the three months ended March 31, 2022, are not necessarily indicative

of results for the complete year.

The condensed consolidated balance sheet of the

Company as of December 31, 2021 has been derived from the audited consolidated balance sheet of the Company as of that date.

For further information, refer to the consolidated

financial statements and footnotes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.

New and applicable accounting pronouncements:

Investments – Equity

Securities (Topic 321), Investments – Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) –

Clarifying the Interactions between Topic 321, Topic 323 and Topic 815

This guidance was issued in January 2020 to clarify

that a company should consider observable transactions that require a company to either apply or discontinue the equity method of accounting

under Topic 323, Investments-Equity Method and Joint Ventures, for the purposes of applying the measurement alternative in accordance

with Topic 321 immediately before applying or upon discontinuing the equity method.

The amendments also clarify that when determining

the accounting for certain forward contracts and purchased options a company should not consider, whether upon settlement or exercise,

if the underlying securities would be accounted for under the equity method or fair value option.

The guidance is effective for fiscal

years beginning after December 15, 2020, and interim periods within those fiscal years.

The impact of this new guidance did not have a

material impact on the Company’s consolidated financial statements.

Accounting Standards not yet adopted:

Reference Rate Reform –

Facilitation of the Effects of Reference Rate Reform on Financial Reporting (Topic 848)

This guidance provides temporary options to ease

the potential burden in accounting for reference rate reform.

It is intended to help stakeholders during the global market-wide reference

rate transition period.

The guidance is effective as of March 12, 2020 through December 31, 2022.

The Company anticipates being fully prepared to implement a replacement for the reference rate and has determined that any change will

not have a material impact on the Company’s consolidated financial statements.

Financial Instruments – Credit Losses (Topic 326)

ASU, which is commonly known as “CECL,” replaces the current GAAP incurred impairment methodology regarding credit losses

with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information

to inform credit loss estimates.

The amendments in this update affect an entity to varying degrees depending on the credit quality of

the assets held by the entity, their duration, and how the entity applies current GAAP.

adoption of ASU 2016-13 is likely to result in an increase in the allowance for loan losses as a result of changing from an “incurred

loss” model, which encompasses allowances for current known and inherent losses within the portfolio, to an “expected loss”

model, which encompasses allowances for losses expected to be incurred over the life of the portfolio.

Furthermore, ASU 2016-13 will

necessitate that we establish an allowance for expected credit losses on debt securities.

December 2018, the Office of the Comptroller of the Currency (“OCC”), the Federal Reserve Board, and the Federal Deposit

Insurance Corporation (“FDIC”) approved a final rule to address changes to credit loss accounting under GAAP, including banking

organizations’ implementation of CECL.

The final rule provides banking organizations the option to phase in over a three-year period

the day-one adverse effects on regulatory capital that may result from the adoption of the new accounting standard.

November 15, 2019, the FASB delayed the effective date for certain small public companies and other private companies.

As the Company

is currently a smaller reporting company, the amendment delays the effective date of ASU No.

2016-13 to the Company’s fiscal year

beginning January 1, 2023.

we are currently unable to reasonably estimate the impact of adopting ASU 2016-13, we expect that the impact of adoption will be significantly

influenced by the composition, characteristics and quality of our loan and securities portfolios as well as the prevailing economic conditions

and forecasts as of the adoption date.

The Company implemented a process to track required data by utilizing accounting software in preparation

for compliance.

We anticipate being fully prepared for implementation by January 1, 2023.

Reclassifications:

reclassifications have been made to prior period financial statements to conform to the current financial statement presentation.

reclassifications had no effect on net income.

2—EARNINGS PER SHARE

per share (EPS) have been computed based on the weighted average number of common shares outstanding during the periods presented.

were no anti-dilutive shares in 2021 or 2020.

The Company anticipates being fully

prepared to implement a replacement for the reference rate and has determined that any change will not have a material impact on the Company’s

consolidated financial statements.

Financial Instruments

– Credit Losses (Topic 326)

This ASU, which is commonly known as CECL, replaces

the current GAAP incurred impairment methodology regarding credit losses with a methodology that reflects expected credit losses and requires

consideration of a broader range of reasonable and supportable information to inform credit loss estimates.

The amendments in this update

affect an entity to varying degrees depending on the credit quality of the assets held by the entity, their duration, and how the entity

applies current GAAP.

The adoption of ASU 2016-13 has the potential

to result in an increase in the allowance for loan losses as a result of changing from an “incurred loss” model, which encompasses

allowances for current known and inherent losses within the portfolio, to an “expected loss” model, which encompasses allowances

for losses expected to be incurred over the life of the portfolio.

Furthermore, ASU 2016-13 will necessitate that we establish an allowance

for expected credit losses on debt securities.

The new accounting guidance is effective

for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2019.

FASB has deferred the effective date for this ASU for smaller reporting companies, such as the Company, to annual reporting periods and

interim reporting periods within those annual periods, beginning after December 15, 2022.

The Company will continue to estimate

the impact of adopting ASU 2016-13 throughout 2022.

We expect the final adoption of the standard will not have a material impact on the

Company’s consolidated financial statements.

We expect to be fully prepared for implementation by January 1, 2023.

NOTE 2—EARNINGS PER SHARE

Earnings per share (EPS) have been computed based

on the weighted average number of common shares outstanding during the periods presented.

There were no anti-dilutive shares in 2022 or

Participating securities in the table reflect dividends on unvested restricted shares.

The average number of common shares used in the computation of basic and diluted earnings per share are set forth in the tables below:

Three Months Ended Sep.

($ and outstanding shares in thousands - except per share data)

Distributed earnings allocated to common shares

Undistributed (in excess of) earnings allocated to common shares

Net earnings allocated to common shares

Net earnings allocated to participating securities

Net Income allocated to common shares and participating securities

Weighted average shares outstanding for basic earnings per share

Dilutive effect of stock compensation

Weighted average shares outstanding for diluted earnings per share

Basic earnings per common share

Diluted earnings per common share

Nine Months Ended Sep.

The average number of common shares used

in the computation of basic and diluted earnings per share are set forth in the tables below:

Three Months Ended

($ and outstanding shares in thousands - except per share data)

9 unchanged sentences

Diluted earnings per common share

NOTE 3 – BUSINESS COMBINATION

Effective June 5, 2020, the Company acquired Edon

Bancorp and its subsidiary, The Edon State Bank Company of Edon, Ohio (“Edon”).

Edon was headquartered in Edon, Ohio and had

one retail banking office.

At the closing of the acquisition, Edon Bancorp was merged with and into the Company, with the Company surviving,

and Edon was merged with and into State Bank, with State Bank surviving.

Under the terms of the merger agreement, shareholders of Edon

received fixed consideration of $ 103.50 in cash for each share of Edon common stock for total consideration of $ 15.5 million.

accounted for the transaction under the acquisition method of accounting, which means that the acquired assets and liabilities were recorded

at fair value at the date of acquisition.

In accordance with ASC 805, the Company expensed

approximately $ 1.2 million of direct acquisition costs during the three months ended September 30, 2020.

The $ 1.2 million in merger expense

is split between data processing and professional fees expense.

As a result of the acquisition, the Company recorded $ 4.3 million of goodwill

and $ 0.7 million of intangible assets in the second quarter of 2020.

The Company was able to increase both its deposit and loan base and

acquire new households in a new market.

It is expected that this transaction will result in business synergies and economies of scale.

The acquisition was consistent with the Company’s strategy to expand its presence in Northwest Ohio and to increase profitability

by introducing existing products and services to the acquired customer base.

The intangible assets are related to core deposits, which

are being amortized over 10 years on a straight-line basis.

For tax purposes, goodwill is non-deductible but will be evaluated annually

for impairment.

The following table summarizes the fair value

of the total consideration transferred as part of the acquisition as well as the fair value of identifiable assets and liabilities assumed

as of the effective date of the Edon transaction based on assumptions that are subject to change as management continues to evaluate relevant

information as it becomes available.

The table includes any updates to assumptions determined within one year of the completion of the

The contractual principal of loans at the acquisition

date was $ 16.3 million and the estimate of the contractual cash flows not expected to be collected was $ 0.4 million.

Fair value of assets acquired

Cash and cash equivalents

Interest bearing time deposits

Investment securities

Federal Home Loan Bank stock

Loans held for investment

Premises and equipment

Core deposit intangible

Total assets acquired

Fair value of liabilities assumed

Other liabilities

Total liabilities assumed

Total purchase price (cash)

Pro Forma Financial Information

The results of operations of Edon have been included

in the Company’s consolidated financial statements since the acquisition date of June 5, 2020.

The following schedule includes the

pro forma results for the nine months ended September 30, 2021 and 2020, as if the Edon acquisition had occurred as of the beginning of

the reporting periods presented.

The acquisition would have increased revenue by approximately $ 0.5 million and reduced net income by

$ 0.4 million for the nine months ended September 30, 2020.

Summary of Operations ($ in thousands)

Nine Months Ended

SB Financial Consolidated

Net interest income

Provision for loan losses

Net interest income after provision

Non interest income

Non interest expense

Income before income taxes

Income tax expense

Basic earnings per share

Diluted earnings per share

* Income tax expense for Edon calculated using a 21 % statutory

On January 10, 2022, the Company announced that

its board of directors had declared a 5 percent common stock dividend payable on February 4, 2022, to shareholders of record as of January

Holders of the Company’s common shares as of the record date received one additional common share for every twenty common

shares held on the record date.

No fractional shares were issued, and shareholders received cash for such fractional interests based on

the closing price of the Company’s common shares on the record date of $ 19.89 .

Had the 5 percent common stock dividend been included

in the Company’s 2021 financial statements, common shares outstanding would have increased by approximately 345,000 and diluted

earnings per share, assuming the shares were outstanding for the quarter ended March 31, 2021, would have decreased by $ 0.05 per share.

On January 25, 2022, the Company filed a Certificate

of Amendment with the Ohio Secretary of State to amend Article FIRST of its Amended Articles of Incorporation to increase the authorized

number of common shares, without par value, of the Company from 10,000,000 to 10,500,000 .

The addition of these authorized shares did

not have a material impact on the Company’s consolidated financial statements.

Note 3 – AVAILABLE

1 unchanged sentence

The amortized cost and appropriate fair values,

together with gross unrealized gains and losses, of securities at September 30, 2021 and December 31, 2020 were as follows:

together with gross unrealized gains and losses, of securities at March 31, 2022 and December 31, 2021 were as follows:

($ in thousands)

September 30, 2021

Treasury and Government agencies

March 31, 2022

Government agencies

Mortgage-backed securities

2 unchanged sentences

December 31, 2021

Treasury and Government agencies

Government agencies

Mortgage-backed securities

2 unchanged sentences

The amortized cost and fair value of securities

available for sale at September 30, 2021, by contractual maturity, are shown below.

available for sale at March 31, 2022, by contractual maturity, are shown below.

Expected maturities will differ from contractual maturities

7 unchanged sentences

The fair value of securities pledged as collateral,

to secure public deposits and for other purposes, was $ 62.1 million at September 30, 2021 and $ 53.7 million at December 31, 2020.

fair value of securities delivered for repurchase agreements was $ 25.2 million at September 30, 2021 and $ 28.2 million at December 31,

There were no realized gains and losses from sales

of available-for-sale securities for the three and nine months ended September 30, 2021 or September 30, 2020.

to secure public deposits and for other purposes, was $ 65.4 million at March 31, 2022 and $ 54.2 million at December 31, 2021.

value of securities delivered for repurchase agreements was $ 25.3 million at March 31, 2022 and $ 23.6 million at December 31, 2021.

There were no realized gains or losses from sales

of available-for-sale securities for the three months ended March 31, 2022 or March 31, 2021.

Certain investments in debt securities are reported

1 unchanged sentence

Total fair value of these investments was $ 252.6

million at September 30, 2021, and $ 27.3 million at December 31, 2020, which was approximately 72 and 18 percent, respectively, of the

Company’s available-for-sale investment portfolio at such dates.

Based on evaluation of available evidence, including recent changes

in market interest rates, credit rating information and information obtained from regulatory filings, management believes the declines

in fair value for these securities are temporary.

Should the impairment of any of these securities become other than temporary, the cost

basis of the investment will be reduced and the resulting loss recognized in net income in the period the other-than-temporary impairment

is identified.

Securities with unrealized losses, aggregated by investment class and

length of time that individual securities have been in a continuous unrealized loss position, at September 30, 2021 and December 31, 2020

are as follows:

million at March 31, 2022, and $ 214.2 million at December 31, 2021, which consisted of 124 securities, or approximately 95 percent, and

64 securities, or approximately 81 percent, respectively, of the Company’s available-for-sale investment portfolio at such dates.

Based on evaluation of available evidence, including recent changes in market interest rates, credit rating information and information

obtained from regulatory filings, management believes the declines in fair value for these securities are temporary.

Should the impairment

of any of these securities become other than temporary, the cost basis of the investment will be reduced and the resulting loss recognized

in net income in the period the other-than-temporary impairment is identified.

Securities with unrealized losses, aggregated

by investment class and length of time that individual securities have been in a continuous unrealized loss position at March 31, 2022

and December 31, 2021, are as follows:

($ in thousands)

1 unchanged sentence

12 Months or Longer

September 30, 2021

Unrealized Losses

Treasury and Government agencies

March 31, 2022

Government agencies

Mortgage-backed securities

4 unchanged sentences

December 31, 2021

Unrealized Losses

Treasury and Government agencies

Government agencies

Mortgage-backed securities

2 unchanged sentences

The total unrealized loss in the securities portfolio

was $ 2.6 million as of September 30, 2021 compared to a $ 0.06 million unrealized loss at December 31, 2020.

was $ 17.5 million as of March 31, 2022 compared to a $ 3.6 million unrealized loss at December 31, 2021.

Management evaluates securities

for other-than-temporary impairment at least on a quarterly basis, and more frequently when economic or market concern warrants such evaluation.

Consideration is given to (1) the length of time and the extent to which the fair value has been less than cost, (2) the financial condition

and near-term prospects of the issuer, and (3) the intent of the Company to not sell the investment and whether it is more likely than

not that the Company will be required to sell the security before recovery of its amortized cost.

Management has determined there is no

other-than-temporary-impairment on its securities as of September 30, 2021.

for other-than-temporary impairment at least on a quarterly basis, and more frequently when economic or market concern warrants such

Consideration is given to (1) the length of time and the extent to which the fair value has been less than cost, (2) the

financial condition and near-term prospects of the issuer, and (3) the intent of the Company to not sell the investment and whether it

is more likely than not that the Company will be required to sell the security before recovery of its amortized cost.

Management has

determined there is no other-than-temporary-impairment on its securities as of March 31, 2022.

NOTE 4 – LOANS AND ALLOWANCE FOR LOAN LOSSES

58 unchanged sentences

for impairment measurements, unless such loans are the subject of a restructuring agreement due to financial difficulties of the borrower.

Categories of loans at September 30, 2021 and December 31, 2020 include:

Categories of loans at March 31, 2022 and December 31, 2021 include:

Nonaccrual Loans

($ in thousands)

September 2021

December 2020

September 2021

December 2020

Commercial & industrial

30 unchanged sentences

unless other underwriting factors are present to help mitigate risk.

In addition, management tracks the level of owner-occupied commercial

real estate versus non-owner-occupied loans.

In addition, management tracks the level of owner-occupied versus

non-owner-occupied commercial real estate loans.

Construction loans are underwritten utilizing

26 unchanged sentences

The following tables present the activity in the

allowance for loan losses and the recorded investment in loans based on portfolio segment and impairment method as of September 30, 2021,

December 31, 2020 and September 30, 2020.

allowance for loan losses for the three-month periods ended March 31, 2022 and March 31, 2021, and the recorded investment in loans based

on portfolio segment and impairment method as of March 31, 2022 and December 31, 2021.

($ in thousands)

For the Three Months Ended September 30, 2021

Commercial & industrial

Commercial real estate

Residential real estate

Beginning balance

Ending balance

For the Nine Months Ended September 30, 2021

Commercial & industrial

Commercial real estate

Residential real estate

Beginning balance

Ending balance

For the Three Months Ended September 30, 2020

Commercial & industrial

Commercial real estate

Residential real estate

For the Three Months Ended March 31, 2022

Beginning balance

Ending balance

For the Nine Months Ended September 30,

Commercial & industrial

Commercial real estate

Residential real estate

For the Three Months Ended March 31, 2021

Beginning balance

Ending balance

Receivable at September 30, 2021

Commercial & industrial

Commercial real estate

Residential real estate

Loans Receivable at March 31, 2022

Ending balance:

7 unchanged sentences

Loans Receivable at December 31, 2021

Commercial & industrial

Commercial real estate

Residential real estate

Ending balance:

39 unchanged sentences

The following tables present the credit risk profile

of the Company’s loan portfolio based on rating category as of September 30, 2021 and December 31, 2020.

of the Company’s loan portfolio based on rating category as of March 31, 2022 and December 31, 2021.

($ in thousands)

September 30, 2021

Commercial & industrial

Commercial real estate - owner occupied

Commercial real estate - nonowner occupied

Residential real estate

March 31, 2022

real estate -

owner occupied

real estate -

Residential real

Special Mention (5)

1 unchanged sentence

December 31, 2021

Commercial & industrial

Commercial real estate - owner occupied

Commercial real estate - nonowner occupied

Residential real estate

real estate -

owner occupied

real estate -

Residential real

Special Mention (5)

2 unchanged sentences

definitions and allowance for loan loss methodology on an ongoing basis.

The following tables present the Company’s

loan portfolio aging analysis as of September 30, 2021 and December 31, 2020.

The following tables present the Company’s loan portfolio

aging analysis as of March 31, 2022 and December 31, 2021.

($ in thousands)

September 30, 2021

March 31, 2022

90 Days Past Due

Commercial & industrial

3 unchanged sentences

December 31, 2021

90 Days Past Due

Commercial & industrial

12 unchanged sentences

The following tables present impaired loan information as of and for

the three and nine months ended September 30, 2021 and 2020, and for the twelve months ended December 31, 2020:

the three months ended March 31, 2022 and 2021, and for the twelve months ended December 31, 2021:

($ in thousands)

Nine Months Ended

Unpaid Principal

Average Recorded

Interest Income

September 30, 2021

With no related allowance recorded:

Commercial & industrial

Commercial real estate - owner occupied

Commercial real estate - nonowner occupied

Residential real estate

With a specific allowance recorded:

Commercial & industrial

Commercial real estate - owner occupied

Commercial real estate - nonowner occupied

Residential real estate

Commercial & industrial

Commercial real estate - owner occupied

Commercial real estate - nonowner occupied

Residential real estate

Three Months Ended

Unpaid Principal

Average Recorded

Interest Income

September 30, 2021

($ in thousands)

March 31, 2022

With no related allowance recorded:

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Residential real estate

Nine Months Ended

Three Months Ended

September 30, 2020

Average Recorded

Interest Income

March 31, 2021

Average Recorded

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at a point in time.

All loan modifications, including those classified as TDRs, are reviewed and approved by management.

concessions provided to borrowers include:

● Interest rate reduction:

A reduction of the stated

interest rate to a nonmarket rate for the remaining original life of the loan.

The Company also may grant interest rate concessions for

a limited timeframe on a case by case basis.

● Amortization or maturity date change:

in the amortization or maturity date beyond what the collateral supports, including a concession that does any of the following:

(1) Lengthens the amortization period of the amortized principal beyond market terms.

All loan modifications, including those cla ssified as TDRs,

are reviewed and approved by management.

The types of concessions provided to borrowers include:

rate reduction:

A reduction of the stated interest rate to a nonmarket rate for the remaining

original life of the loan.

The Company also may grant interest rate concessions for a limited

timeframe on a case by case basis.

● Amortization

or maturity date change:

A change in the amortization or maturity date beyond what the collateral

supports, including a concession that does any of the following:

(1) Lengthens

the amortization period of the amortized principal beyond market terms.

This concession reduces

the minimum monthly payment and increases the amount of the balloon payment at the end of the term of the loan.

Principal is generally

not forgiven.

(2) Reduces the amount of loan principal to be amortized.

the minimum monthly payment and increases the amount of the balloon payment at the end of

the term of the loan.

Principal is generally not forgiven.

the amount of loan principal to be amortized.

This concession also reduces the minimum monthly

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Principal is generally not forgiven.

(3) Extends the maturity date or dates of the debt beyond what the collateral supports.

This concession generally

applies to loans without a balloon payment at the end of the term of the loan.

In addition, there may be instances where renewing loans

potentially require non-market terms and would then be reclassified as TDRs.

A concession that is not categorized as

one of the concessions described above.

These concessions include, but are not limited to:

principal forgiveness, collateral concessions,

covenant concessions, and reduction of accrued interest.

Principal forgiveness may result from any TDR modification of any concession

the maturity date or dates of the debt beyond what the collateral supports.

This concession

generally applies to loans without a balloon payment at the end of the term of the loan.

In addition, there may be instances where renewing loans potentially require non-market terms

and would then be reclassified as TDRs.

A concession that is not categorized as one of the concessions described above.

These concessions

include, but are not limited to:

principal forgiveness, collateral concessions, covenant

concessions, and reduction of accrued interest.

Principal forgiveness may result from any

TDR modification of any concession type.

The Company had no new TDR activity in the three

months ended September 30, 2021.

The following table represents new TDR activity for the nine months ended September 30, 2021.

the three and nine months ended September 30, 2020, the Company had no new TDR activity.

($ in thousands)

Number of Loans

Pre-Modification

Recorded Balance

Post Modification

Recorded Balance

Total modifications

There were no TDRs modified during the past twelve months that have

subsequently defaulted.

On March 27, 2020, President Trump signed into

law the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”), which extends the duration of loan forbearance

(deferral) agreements beyond the current three-month period before a loan is considered to be a TDR.

As of September 30, 2021, the Company

had no loans on COIVD-related deferral.

As of September 30, 2021, the Company had $ 1.6

million in commercial real estate in Foreclosed Assets Held For Sale.

Foreclosed assets held for sale at December 31, 2020, was $.

NOTE 6 – ACCOUNTING FOR CERTAIN LOANS

ACQUIRED IN A TRANSFER

The Company acquired loans in the acquisition

of Edon effective June 5, 2020.

None of the acquired loans had evidence of deterioration of credit quality since origination, and it was

probable, at acquisition, that all contractually required payments would be collected.

The following table presents the carrying amount

of the acquired loans included in the consolidated balance sheet as of September 30, 2021:

months ended March 31, 2022, and March 31, 2021, respectively.

There were no TDRs modified during the past twelve months that have subsequently

On March 22, 2020, a statement was issued by the

Company’s bank regulators and titled the “Interagency Statement on Loan Modifications and Reporting for Financial Institutions

Working with Customers Affected by the Coronavirus” (the “Interagency Statement”) that encouraged financial institutions

to work prudently with borrowers unable to meet the contractual payment obligations due to the effects of COVID-19.

Additionally, Section

4013 of the Coronavirus Aid, Relief, and Economic Security Act of 2020, as amended (the “CARES Act”) further provided that

a qualified loan modification is exempt by law from classification as a troubled debt restructure as defined by GAAP, from the period

beginning March 1, 2020 until the earlier of December 31, 2021 or the date that is 60 days after the date on which the national emergency

concerning the COVID-19 outbreak under the National Emergencies Act (50 U.S.C.

1601 et seq.) terminates.

As of March 31, 2022, all loans

previously modified under Section 4013 of the CARES Act had returned to normal payment terms.

NOTE 5 – GOODWILL

A summary of the activity in goodwill is presented

Three Months Ended

($ in thousands)

September 30,

Commercial & industrial

Commercial real estate - owner occupied

Commercial real estate - nonowner occupied

Residential real estate

Accretable yield, or income expected to be collected as of September

30, 2021 was $ 0.3 million.

Beginning balance

Measurement period adjustments

Ending balance

Goodwill is not amortized but is evaluated for

impairment annually, and on an interim basis if events or circumstances change that indicate an impairment may exist.

As of March 31, 2022 and December 31, 2021 the

carrying amount of goodwill was $ 23.2 million.

Goodwill is assessed for impairment annually as of December 31, or more frequently if events

occur or circumstances change that indicate an impairment may exist.

When assessing goodwill for impairment, first, a qualitative assessment

can be made to determine whether it is more likely than not that the estimated fair value of a reporting unit is less than its estimated

carrying value.

If the results of the qualitative assessment are not conclusive, a quantitative goodwill test is performed.

Alternatively,

a quantitative goodwill test can be performed without performing a qualitative assessment.

Goodwill was assessed for impairment using a qualitative

test performed as of December 31, 2021.

The results of the test indicated no goodwill impairment existed as of that date.

NOTE 6 – MORTGAGE SERVICING RIGHTS

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The unpaid principal balance of mortgage loans serviced for others approximated $ 1.38

billion at September 30, 2021 and $ 1.3 billion at December 31, 2020.

billion at March 31, 2022 and $ 1.36 billion at December 31, 2021.

Contractually specified servicing fees of $ 0.9 million and $ 0.8 million

were included in mortgage loan servicing fees in the consolidated income statement for the three months and nine months ended September

30, 2021, respectively.

Servicing fees of $ 0.8 million and $ 2.4 million were included for the three and nine months ended September 30,

were included in mortgage loan servicing fees in the consolidated income statement for the three months ended March 31, 2022 and 2021,

respectively.

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rights capitalized and related amortization, along with activity in the related valuation allowance:

Three Months Ended

September 30,

Nine Months Ended

September 30,

Three Months Ended March 31,

($ in thousands)

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Balance at end of period

NOTE 8 – GOODWILL

A summary of the activity in goodwill is presented

September 30,

in thousands)

Beginning balance

Acquired goodwill

Measurement period adjustments

Ending balance

Goodwill is not amortized but is evaluated for

impairment annually, and on an interim basis if events or circumstances change that indicate an impairment may exist.

As of September 30, 2021 and December 31, 2020

the carrying amount of goodwill was $ 22.1 million.

There have been no changes in the carrying amount of the goodwill for the three and

nine months ended September 30, 2021 Goodwill is assessed for impairment annually as of December 31, or more frequently if events occur

or circumstances change that indicate an impairment may exist.

When assessing goodwill for impairment, first, a qualitative assessment

can be made to determine whether it is more likely than not that the estimated fair value of a reporting unit is less than its estimated

carrying value.

If the results of the qualitative assessment are not conclusive, a quantitative goodwill test is performed.

Alternatively,

a quantitative goodwill test can be performed without performing a qualitative assessment.

Goodwill was assessed for impairment using a qualitative test performed

as of September 30, 2021..

The results of the test indicated no goodwill impairment existed as of that date.

Fair value, beginning of period

Fair value, end of period

NOTE 7 – DERIVATIVE FINANCIAL INSTRUMENTS

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The table below presents the notional amount and

fair value of the Company’s interest rate swaps, IRLCs and forward contracts utilized as of September 30, 2021 and December 31,

September 30, 2021

fair value of the Company’s interest rate swaps, IRLCs and forward contracts utilized as of March 31, 2022 and December 31, 2021.

March 31, 2022

December 31, 2021

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The following table presents the amounts included

in the consolidated statements of income for non-hedging derivative financial instruments for the nine months ended September 30, 2021

Three Months Ended

September 30,

in the consolidated statements of income for non-hedging derivative financial instruments for the three months ended March 31, 2022 and

Amount of gain (loss)

($ in thousands)

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The following table shows the offsetting of financial assets and derivative

assets at September 30, 2021 and December 31, 2020.

assets at March 31, 2022 and December 31, 2021.

Gross amounts

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offset in the

Net amounts of

presented in the

Gross amounts not offset in the

consolidated balance

Gross amounts not offset in the consolidated balance sheet

($ in thousands)

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Cash collateral

September 30, 2021

March 31, 2022

Interest rate swaps

1 unchanged sentence

Interest rate swaps

The following table shows the offsetting of financial liabilities

and derivative liabilities at September 30, 2021 and December 31, 2020.

The following table shows the offsetting of financial liabilities and

derivative liabilities at March 31, 2022 and December 31, 2021.

Gross amounts

1 unchanged sentence

offset in the

Net amounts of

presented in the

Net amounts of liabilities

Gross amounts not offset in the

consolidated balance

consolidated balance sheet

($ in thousands)

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Cash collateral

September 30, 2021

March 31, 2022

Interest rate swaps

1 unchanged sentence

Interest rate swaps

NOTE 8 – DEPOSITS

Major classification of deposits at March 31,

2022 and at December 31, 2021 were as follows:

($ in thousands)

Non interest bearing demand

Interest bearing demand

Time deposits less than $ 250,000

Time deposits $ 250,000 or greater

Total Deposits

Included in time deposits at March 31, 2022 and

December 31, 2021 were $ 52.5 million and $ 55.6 million, respectively, of deposits which were obtained through the Certificate of Deposit

Account Registry Service (CDARS).

NOTE 9 – SHORT-TERM BORROWINGS

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through 2061.

As of September 30, 2021, these repurchase agreements were secured by securities totaling $ 25.2 million.

The repurchase

agreements mature within one month.

As of March 31, 2022, these repurchase agreements were secured by securities totaling $ 25.3 million.

The repurchase agreements

mature within one month.

The Company has borrowing capabilities at the

Federal Reserve Discount Window by pledging either securities or loans as collateral.

As of September 30, 2021, there was no collateral

pledged or borrowings drawn at the Discount Window.

At September 30, 2021 and December 31, 2020, the

Company had $ 41.0 million in federal funds lines, of which none was drawn.

Federal Reserve Discount Window (“Discount Window”) by pledging either securities or loans as collateral.

As of March 31,

2022, there was no collateral pledged or borrowings drawn at the Discount Window.

At March 31, 2022 and December 31, 2021, the Company

had $ 41.0 million in federal funds lines, of which none were drawn.

NOTE 10 – FEDERAL HOME LOAN BANK ADVANCES

The Company’s FHLB advances were secured

by $ 155.4 million in mortgage loans at September 30, 2021.

by $ 163.7 million in mortgage loans at March 31, 2022.

Advances, at interest rates from 2.88 to 2.93 percent, are subject to restrictions

or penalties in the event of prepayment.

Aggregate annual maturities of FHLB advances at September 30, 2021 were:

Aggregate annual maturities of FHLB advances at March 31, 2022 were:

($ in thousands)

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Distributions on the Capital Securities are payable quarterly at a variable rate that is based upon the 3-month LIBOR plus

1.80%, currently at 1.92%, and are included in interest expense in the consolidated financial statements.

These securities may be included

in Tier 1 capital and may be prepaid at any time without penalty (with certain limitations applicable) under current regulatory guidelines

and interpretations .

The balance of the Capital Securities as of September 30, 2021 and December 31, 2020 was $ 10.3 million, with a maturity

date of September 15, 2035 .

1.80 percent and are included in interest expense in the consolidated financial statements.

The issuers of these securities have not yet

determined the replacement rate index for LIBOR.

These securities may be included in Tier 1 capital and may be prepaid at any time without

penalty (with certain limitations applicable) under current regulatory guidelines and interpretations.

The balance of the Capital Securities

as of March 31, 2022 and December 31, 2021 was $ 10.3 million, with a maturity date of September 15, 2035 .

NOTE 12 – SUBORDINATED DEBT

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placement exempt from the registration requirements under the Securities Act of 1933, as amended.

The Notes mature on June 1, 2031 and

bear interest at a fixed rate of 3.65% through May 31, 2026.

From June 1, 2026 to the maturity date or earlier redemption of the Notes,

the interest rate will reset quarterly to an interest rate per annum, equal to the then-current-three-month Secured Overnight Financing

Rate (“SOFR”) provided by the Federal Reserve Bank of New York plus 296 basis points.

The Company may redeem the Notes at any

time after May 31, 2026, and at any time in whole, but not in part, upon the occurrence of certain events.

Any redemption of the Notes

will be subject to prior regulatory approval.

The Company incurred debt issuance costs for placement fees, legal and other out-of-pocket

expenses of approximately $ 0.5 million, which are being amortized over the life of the Notes.

NOTE 14 – FAIR VALUE OF ASSETS AND LIABILITIES

The Notes mature on June 1, 2031 and bear interest

at a fixed rate of 3.65% through May 31, 2026.

From June 1, 2026 to the maturity date or earlier redemption of the Notes, the interest

rate will reset quarterly to an interest rate per annum, equal to the then-current-three-month Secured Overnight Financing Rate (“SOFR”)

provided by the Federal Reserve Bank of New York plus 296 basis points.

The Company may redeem the Notes at any time after May 31, 2026,

and at any time in whole, but not in part, upon the occurrence of certain events.

Any redemption of the Notes will be subject to prior

regulatory approval.

The Company incurred debt issuance costs for placement fees, legal and other out-of-pocket expenses of approximately

$ 0.5 million, which are being amortized over the life of the Notes.

NOTE 13 – DISCLOSURES ABOUT FAIR VALUE

OF ASSETS AND LIABILITIES

Fair value is the price that would be received

3 unchanged sentences

levels of inputs that may be used to measure fair value:

Level 1 Quoted prices in active markets for identical assets or liabilities

Level 2 Observable inputs other than Level 1 prices, such as

quoted prices for similar assets or liabilities;

Level 1 Quoted prices in active markets for identical assets

or liabilities

Level 2 Observable inputs other than Level 1 prices, such

as quoted prices for similar assets or liabilities;

quoted prices in markets that are not active;

or other inputs that are observable or

can be corroborated by observable market data for substantially the full term of the assets or liabilities

Level 3 Unobservable inputs that are supported by little or

no market activity and that are significant to the fair value of the assets or liabilities

or other inputs that are observable

or can be corroborated by observable market data for substantially the full term of the assets or liabilities

Level 3 Unobservable inputs that are supported by little

or no market activity and that are significant to the fair value of the assets or liabilities

Following is a description of the valuation methodologies

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of assets measured at fair value on a recurring basis and the level within the fair value hierarchy in which the fair value measurements

fell at September 30, 2021 and December 31, 2020.

fell at March 31, 2022 and December 31, 2021.

($ in thousands)

Fair value at

September 30,

March 31, 2022

Treasury and Government Agencies

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Fair value at

December 31, 2021

Treasury and Government Agencies

7 unchanged sentences

Level 2 - significant other observable inputs

Level 3 - significant unobservable inputs

Level 3 - significant unobservable

The following table reconciles the beginning and

ending balances of recurring fair value measurements recognized in the accompanying consolidated balance sheets using significant unobservable

(Level 3) inputs for the three and nine months ended September 30, 2021 and 2020.

for the Three Months Ended

September 30,

for the Nine Months Ended

September 30,

(Level 3) inputs for the three months ended March 31, 2022 and 2021.

Three Months Ended

($ in thousands)

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review policy.

All impaired loans held by the Company were collateral dependent at September 30, 2021 and December 31, 2020.

All impaired loans held by the Company were collateral dependent at March 31, 2022 and December 31, 2021.

Mortgage Servicing Rights

15 unchanged sentences

Fair value at

September 30,

March 31, 2022

Impaired loans

2 unchanged sentences

Fair value at

December 31, 2021

Impaired loans

8 unchanged sentences

Fair value at

September 30,

Valuation technique

Unobservable inputs

(weighted-average)

Range (weighted-

Collateral-dependent impaired loans

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($ in thousands)

(weighted-average)

Fair value at

Unobservable inputs

Range (weighted-

Collateral-dependent impaired loans

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There were no changes in the inputs or methodologies

used to determine fair value at September 30, 2021 as compared to December 31, 2020.

used to determine fair value at March 31, 2022 as compared to December 31, 2021.

The following methods were used to estimate the

7 unchanged sentences

Company’s current origination rates for similar loans and adjusted to reflect the inherent credit risk.

The estimated fair value of loans as of September

30, 2021 follows the guidance in ASU 2016-01, which prescribes an “exit price” approach in estimating and disclosing fair

value of financial instruments.

The fair value calculation at that date discounted estimated future cash flows using rates that incorporated

discounts for credit, liquidity, and marketability factors.

The estimated fair value of loans follows the

guidance in ASU 2016-01, which prescribes an “exit price” approach in estimating and disclosing fair value of financial instruments.

The fair value calculation at that date discounted estimated future cash flows using rates that incorporated discounts for credit, liquidity,

and marketability factors.

Deposits, FHLB Advances & Repurchase Agreements

4 unchanged sentences

as well as borrowings, is based on estimates of the rate State Bank could pay on similar instruments with similar terms and maturities

at September 30, 2021 and December 31, 2020.

at March 31, 2022 and December 31, 2021.

Loan Commitments

3 unchanged sentences

The estimated fair values for other financial instruments and off-balance-sheet loan commitments

approximate cost at September 30, 2021 and December 31, 2020 and are not considered significant to this presentation.

approximate cost at March 31, 2022 and December 31, 2021 and are not considered significant to this presentation.

Trust Preferred Securities

16 unchanged sentences

Fair value measurements using

September 30, 2021

March 31, 2022

Financial assets

5 unchanged sentences

Interest receivable

Mortgage servicing rights

Financial liabilities

14 unchanged sentences

Interest receivable

Mortgage servicing rights

Financial liabilities

2 unchanged sentences

Trust preferred securities

Subordinated debt, net of issuance costs

Interest payable

5 unchanged sentences

The 2017 Plan permits the Company to grant or award incentive stock options,

nonqualified stock options, stock appreciation rights, restricted stock, and restricted stock units to employees and directors of the

Company and its subsidiaries.

A total of 500,000 common shares of the Company are available for grants or awards under the 2017 Plan,

of which 89,833 shares had been granted under the plan as of September 30, 2021.

nonqualified stock options, stock appreciation rights (“SARs”), restricted stock, and restricted stock units to employees

and directors of the Company and its subsidiaries.

A total of 500,000 common shares of the Company are available for grants or awards

under the 2017 Plan, of which 122,198 shares had been granted under the plan as of March 31, 2022.

The 2017 Plan is intended to advance the interests

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valuation model.

As of September 30, 2021, there were no stock

options outstanding, and no unrecognized compensation cost related to stock option awards.

No stock options were granted in the nine months

As of March 31, 2022, there were no stock options outstanding, and no unrecognized compensation cost related to stock

option awards.

No stock options were granted in the first three months of 2022.

On February 5, 2013, the Company adopted a Long

5 unchanged sentences

The compensation

cost charged against income for the LTI Plan was $ 0.4 million, with a total income tax benefit recognized in the income statement of $ 0.08

As of September 30, 2021, there was $ 0.65 million

of total unrecognized compensation cost related to non-vested share-based compensation arrangements related to the restricted stock awards

cost charged against income for awards under the LTI Plan for the three months ended March 31, 2022 and March 31, 2021, was $ 0.2 million

and $ 0.1 million, respectively, with a total income tax benefit recognized in the income statement of $ 0.03 million and $ 0.03 million,

respectively.

As of March 31, 2022, there was $ 1.1 million of

total unrecognized compensation cost related to non-vested share-based compensation arrangements related to the restricted stock awards

under the 2017 Plan which were granted in accordance with the LTI plan.

2 unchanged sentences

The table below is a summary of restricted stock

activity under the Company’s 2017 Plan for the nine months ended September 30, 2021.

Average Value

activity under the Company’s 2017 Plan for the three months ended March 31, 2022.

Nonvested, January 1, 2022

Nonvested, September 30, 2021

Nonvested, March 31, 2022

NOTE 15 – GENERAL LITIGATION

3 unchanged sentences

It is the opinion of management that the disposition or ultimate resolution of any such claims, lawsuits and examinations pending

at September 30, 2021, will not have a material adverse effect on the consolidated financial position, results of operations and cash

flow of the Company.

at March 31, 2022, will not have a material adverse effect on the consolidated financial position, results of operations and cash flow

of the Company.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements