Note 14 - Salary Continuation Plan

12 Months Ended

Dec. 31, 2018

Notes to Financial Statements

Salary Continuation Plan [Text Block]

Note

14.

Salary Continuation Plan

The Company has a Salary Continuation Plan for certain key officers. The plan provides the participating officers with supplemental retirement income. The Supplemental Executive Retirement Plan (the “SERP”) provides lifetime payments equal to

20%

of a participant’s average annual base salary for the

five

years immediately prior to retirement. There is an incentive formula with an additional benefit of

20%

of a participant’s average annual base salary for the

five

years immediately prior to retirement if performance targets set by the Board of Directors are met. The SERP contains provisions for disability and survivor benefits, a benefit vesting schedule based on age attained and automatic full vesting in the event of a change in control of the Company. Accrued deferred compensation expense under the SERP, included in other liabilities, totaled

$1.4

million and

$1.0

million at the end of

2018

and

2017,

respectively. Compensation expense related to the SERP was

$351

thousand for

2018

compared to

$357

thousand for

2017.

Payments made under the SERP totaled

$11

thousand for

2018

compared to

none

in

2017.

The funding mechanism for the plan is Bank Owned Life Insurance policies on the lives of the participants.