BV Financial, Inc. Stock Compensation Disclosure

Note 9 – Employee Benefit Plans

Stock Options

On December 14, 2017, the Company granted 79,607 stock options to officers and employees of the Company of which 7,630 and 54,117 were exercisable at December 31, 2025 and December 31, 2024, respectively. The options were granted with an exercise price at the then fair market value of the stock of $5.65, scheduled to vest over five years and expire ten years from the date of grant. On September 6, 2024, the Company granted 293,968 stock options to directors of the Company of which 73,496 were exercisable as of December 31, 2025. On September 17, 2024, the Company granted 584,948 stock options to officers of the Company of which 146,238 were exercisable as of December 31, 2025. The options were granted with an exercise price at the then fair market value of the stock of $14.25 and $14.86, respectively, are scheduled to vest over four years and expire ten years from the date of grant.

Note 9 – EMPLOYEE BENEFIT PLANS (Continued)

The Company recognized $1.7 million and $667,000 in compensation expense during the years ended December 31, 2025 and December 31, 2024, respectively, related to the granting of stock options.

As of December 31, 2025 and December 31, 2024, there was $1.5 million and $3.2 million, respectively, in future compensation expense associated with outstanding stock options.

Restricted Stock

In 2025 and 2024, the Company granted zero and 343,562 shares of restricted stock to Board members and certain executive officers, respectively.

The Company recognized $2.2 million and $986,000 in compensation expense during the years ended December 31, 2025 and December 31, 2024, respectively, relating to the granting of restricted stock.

As of December 31, 2025 and December 31, 2024, there was $2.0 million and $4.2 million, respectively, in future compensation expense associated with restricted stock.

Note 9 – EMPLOYEE BENEFIT PLANS (Continued)

The Company offers benefits under the BayVanguard Bank Employee Stock Ownership Plan (the "ESOP") to employees who meet certain eligibility requirements. In connection with the Conversion, the ESOP subscribed for 8% of the shares of the Company stock sold in the offering. The purchase was funded through a loan of $7.8 million from the Company, with an interest rate of 8.50% with a twenty-year term. Total shares purchased by the ESOP were 783,918. The Company makes annual contributions to the ESOP equal to the ESOP's debt service. Shares purchased with the proceeds from the loan, that have not been allocated to employees are pledged as collateral for the loan, and held in a suspense account for future allocations to participants. Shares released from the expense account are allocated among the participants based on compensation, as defined in the ESOP documents. The ESOP shares pledged as collateral are reported as unearned common stock held by ESOP shares in the Company's Consolidated Balance Sheet. As shares are committed to be released, the Company recognizes compensation expense equal to the current market price of the shares, and the shares become outstanding in the earnings per share calculation. The Company recognized $422,000 and $319,000 of ESOP expense associated with the release of the shares during the years ended December 31, 2025 and 2024, respectively.

The number of shares committed to be released per year is 39,196 thru 2041, and 39,194 in 2042.