PLUMAS BANCORP

During2002, Plumas Bancorp (the "Company") was incorporated as a bank holding company for the purpose of acquiring Plumas Bank (the "Bank") in aone bank holding company reorganization. This corporate structure gives the Company and the Bank greater flexibility in terms of operation, expansion and diversification. The Company formed Plumas Statutory Trust I ("Trust I") for the sole purpose of issuing trust preferred securities on* September 26, 2002.The Company formed Plumas Statutory Trust II ("Trust II") for the sole purpose of issuing trust preferred securities on September 28, 2005.In March 2023*the Trusts were dissolved. Plumas Bancorp's Principal Executive Office is located in Reno, Nevada.

The Bank operates seventeen branches in California, including branches in Alturas, Anderson, Chester, Chico, Fall River Mills, Greenville, Kings Beach, Portola, Quincy, Redding (3 branches), Red Bluff, Susanville, Tahoe City, Truckee and Yuba City. The Bank’s administrative headquarters are in Quincy, California. In* December 2015the Bank opened a branch in Reno, Nevada, itsfirst* branch outside of California, and in2018 the Bank purchased a branch located in Carson City, Nevada. In addition, the Bank operates a lending office specializing in government-guaranteed lending in Auburn, California, and a commercial/agricultural lending office in Klamath Falls, Oregon. The Bank's primary source of revenue is generated from providing loans to customers who are predominately small and middle market businesses and individuals residing in the surrounding areas. On* July 1, 2025,*the Company completed its acquisition of Cornerstone Community Bancorp (Cornerstone) increasing its branch network in California byfour branches: one in Anderson, one in Red Bluff andtwo in Redding.

Consolidation and Basis of Presentation

The consolidated financial statements include the accounts of the Company and the consolidated accounts of its wholly-owned subsidiary, Plumas Bank. All significant intercompany balances and transactions have been eliminated. The accounting and reporting policies of Plumas Bancorp and subsidiary conform with accounting principles generally accepted in the United States of America and prevailing practices within the banking industry.

Reclassifications

Certain reclassifications have been made to prior years’ balances to conform to the classifications used in2024. These reclassifications hadno impact on the Company’s consolidated financial position, results of operations or net change in cash and cash equivalents.

Segment Information

An operating segment is generally defined as a component of business for which discrete financial information is available and whose operating results are regularly reviewed by the chief operating decision maker. As a community-oriented financial institution, substantially all of the Company’s operations involve the delivery of loan and deposit products to customers.

The chief operating decision maker makes operating decisions and assesses performance based on an ongoing review of the Company’s community banking activities, which constitutes the Company’s only operating segment for financial reporting purposes. The Company’s single reportable segment is determined by the Chief Financial Officer, who is the designated chief operating decision maker, based upon information provided about the Company’s products and services offered, primarily banking operations. The segment is also distinguished by the level of information provided to the chief operating decision maker, who uses such information to review performance of various components of the business such as branches and departments, which are then aggregated if operating performance, products/services, and customers are similar. The chief operating decision maker will evaluate the financial performance of the Company’s business components by evaluating revenue streams, significant expenses, and budget to actual results in assessing the Company’s segment and in the determination of allocating resources. The chief operating decision maker uses revenue streams to evaluate product pricing and significant expenses to assess performance and evaluate return on assets. The chief operating decision maker uses consolidated net income to benchmark the Company against its competitors. The benchmarking analysis coupled with monitoring of budget to actual results are used in assessing performance and in establishing compensation. Loans, investments, and deposits provide the revenues in the banking operation. Interest expense, provisions for credit losses, and payroll provide the significant expenses in the banking operation. The consolidated expense information is the same as is reported on the income statement as consolidated net income. The measure of segment assets is reported on the balance sheet as total consolidated assets. All operations are domestic.

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Business Combination and Fair Value Measurements

The Company completed its acquisition of Cornerstone on* July 1, 2025.The transaction was accounted for under the acquisition method in accordance with Accounting Standards Codification805,* Business Combinations (ASC805), and the identifiable assets acquired, and liabilities assumed were recorded at their estimated fair values. Acquisition-related costs, including legal, accounting, and other professional fees, totaled approximately $1.9 million and were expensed as incurred in accordance with ASC805.

Fair Value Methodologies:

Use of Estimates

To prepare financial statements in conformity with accounting principles generally accepted in the United States of America management makes estimates and assumptions based on available information. These estimates and assumptions affect the amounts reported in the financial statements and the disclosures provided, and actual results could differ. The allowance for credit losses, loan servicing rights, deferred tax assets, and fair values of financial instruments are particularly subject to change.

Cash and Cash Equivalents

For the purpose of the statement of cash flows, cash and due from banks and Federal funds sold are considered to be cash equivalents. Generally, Federal funds are sold forone day periods. Net cash flows are reported for customer loans and deposit transactions and repurchase agreements.

Investment Securities

Investments are classified intoone of the following categories:

Management determines the appropriate classification of its investments at the time of purchase and* may*only change the classification in certain limited circumstances.

Interest income includes amortization of purchase premium or discount. Premiums and discounts on securities are amortized on the level-yield method without anticipating prepayments, except for mortgage-backed securities where prepayments are anticipated. Premiums on callable debt securities are amortized to their earliest call date. Gains and losses on sales are recorded on the trade date and determined using the specific identification method.

The Company evaluates available for sale debt securities in an unrealized loss position to determine whether the decline in the fair value below the amortized cost basis (impairment) is due to credit-related factors or noncredit-related factors. Any impairment that isnot credit related is recognized in other comprehensive income, net of applicable taxes. Credit-related impairment is recognized as an allowance for credit losses on the balance sheet, limited to the amount by which the amortized cost basis exceeds the fair value, with a corresponding adjustment to earnings. Both the allowance for credit losses and the adjustment to net income* maybe reversed if conditions change. However, if the Company intends to sell an impaired available for sale debt security or more likely thannot* will be required to sell such a security before recovering its amortized cost basis, the entire impairment amount is recognized in earnings with a corresponding adjustment to the security's amortized cost basis. In evaluating available for sale debt securities in unrealized loss positions for impairment and the criteria regarding its intent or requirement to sell such securities, the Company considers the extent to which fair value is less than amortized cost, whether the securities are issued by the federal government or its agencies, whether downgrades by bond rating agencies have occurred, and the results of reviews of the issuers' financial condition, among other factors. Changes in the allowance for credit losses are recorded as provision for (or reversal of) credit loss expense. Losses are charged against the ACL when management believes the uncollectability of an available for sale debt security is confirmed or when either of the criteria regarding intent or requirement to sell is met.No security credit losses were recognized during the years ended* December 31, 2025*,2024 or2023.

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Federal Home Loan Bank Stock

As a member of the Federal Home Loan Bank (FHLB) System, the Bank is required to maintain an investment in the capital stock of the FHLB. The investment is carried at cost, classified as a restricted security, and periodically evaluated for impairment based on ultimate recovery of par value. Both cash and stock dividends are reported as income. At* December 31, 2025and December 31, 2024*, the Company held $8,084,000 and $6,234,000, respectively of FHLB stock. On the consolidated balance sheet, FHLB stock is included in accrued interest receivable and other assets.

Federal Reserve Bank Stock

The Bank is a member of its regional Federal Reserve Bank (FRB). FRB stock is carried at cost, classified as a restricted security, and periodically evaluated for impairment based on ultimate recovery of par value. Both cash and stock dividends are reported as income. At* December 31, 2025and December 31, 2024*, the Company held $3,565,000 and $1,380,000, respectively of FRB stock. On the consolidated balance sheet, FRB stock is included in accrued interest receivable and other assets.

Loans Held for Sale, Loan Sales and Servicing

Included in the loan portfolio are loans which are 75% to 90% guaranteed by the Small Business Administration (SBA), US Department of Agriculture Rural Business Cooperative Service (RBS) and Farm Services Agency (FSA). In some cases, the guaranteed portion of these loans* maybe sold to athird* party, with the Bank retaining the unguaranteed portion. The Company can receive a premium in excess of the adjusted carrying value of the loan at the time of sale.

There wereno loans held for sale on* December 31, 2025and2024.* Loans held for sale are recorded at the lower of cost or fair value and therefore* may*be reported at fair value on a non-recurring basis. The fair values for loans held for sale are based on either observable transactions of similar instruments or formally committed loan sale prices.

SBA Government guaranteed loans with unpaid balances of$83,668*,000* and $95,332,000 were being serviced for others at* December 31, 2025and2024*, respectively.

The Company accounts for the transfer and servicing of financial assets based on the fair value of financial and servicing assets it controls and liabilities it has assumed, derecognizes financial assets when control has been surrendered, and derecognizes liabilities when extinguished.

Servicing rights acquired through1) a purchase or2) the origination of loans which are sold or securitized with servicing rights retained are recognized as separate assets or liabilities. Servicing assets or liabilities are recorded at fair value and are subsequently amortized in proportion to and over the period of the related net servicing income or expense. Servicing rights are evaluated for impairment based upon the fair value of the rights as compared to carrying amount. Impairment is determined by stratifying rights into groupings based on predominant risk characteristics, such as interest rate, loan type and investor type. Impairment is recognized through a valuation allowance for an individual grouping, to the extent that fair value is less than the carrying amount. If the Company later determines that all or a portion of the impairmentno longer exists for a particular grouping, a reduction of the allowance* may*be recorded as an increase to income. Changes in valuation allowances are reported with non-interest income on the statement of income. The fair values of servicing rights are subject to significant fluctuations as a result of changes in estimated and actual prepayment speeds and default rates and losses.

The Company's investment in the loan is allocated between the retained portion of the loan and the sold portion of the loan based on their fair values on the date the loan is sold. The gain on the sold portion of the loan is recognized as income at the time of sale.

The carrying value of the retained portion of the loan is discounted based on the estimated value of a comparable non-guaranteed loan.

F-17

Loans

Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are reported at amortized cost which is the principal balance outstanding, net of purchase premiums or discounts, deferred loan fees and costs. Loans, if any, that are transferred from loans held for sale are carried at the lower of principal balance or market value at the date of transfer, adjusted for accretion of discounts. Interest is accrued daily based upon outstanding loan balances.** **However, when, in the opinion of management, the future collectability of interest and principal is in serious doubt, loans are placed on nonaccrual status and the accrual of interest income is suspended. Any interest accrued but unpaid is charged against income. Payments received are applied to reduce principal to the extent necessary to ensure collection. A loan is moved to non-accrual status in accordance with the Company’s policy, typically after90 days of non-payment unless well secured and in the process of collection. Past due status is based on the contractual terms of the loan. Subsequent payments on these loans, or payments received on nonaccrual loans for which the ultimate collectability of principal isnot in doubt, are appliedfirst to earned but unpaid interest and then to principal. A nonaccrual loan is returned to accruing status when the borrower has cured the delinquency, has made at leastsix consecutive months of timely contractual payments, and management determines, based on an evaluation of the borrower’s financial condition and other relevant factors, that the collection of remaining principal and interest is reasonably assured.

Consistent with the guidance in ASC326‑20‑30‑5a, the Company has elected the** practical expedient to exclude accrued interest receivable from the amortized cost basis of loans when estimating expected credit losses. Accrued interest receivable on loans is recorded separately in “Accrued interest receivable and other assets” on the Consolidated Balance Sheets. The Company writes off uncollectible accrued interest receivable by reversing interest income when amounts are90 days past due or earlier if collection is deemed doubtful. Because accrued interest receivable is excluded from the amortized cost basis of loans,no allowance for credit losses is recorded on accrued interest receivable.**

Loan balances are charged off when management concludes that amounts are uncollectible, which generally occurs upon confirmation of loss, bankruptcy, significant deterioration in the borrower’s financial condition, or when the borrower is120 days or more past due, depending on asset type.

Loan origination fees, commitment fees, direct loan origination costs and purchased premiums and discounts on loans are deferred and recognized as an adjustment of yield, to be amortized to interest income over the contractual term of the loan. The unamortized balance of deferred fees and costs is reported as a component of net loans.

Allowance for Credit Losses

To estimate the Allowance for Credit Loss (ACL), the Company elected to use the Discounted Cash Flow (DCF) methodology. This method uses loan level repayment terms to determine expected cash flows which are then discounted by various assumptions such as prepayment or curtailment rates, Probability of Default and Loss Given Default rates.

The ACL is measured on the loan’s amortized cost over the remaining contractual lives of the loan portfolios, adjusted for industry average prepayment and curtailment rates. The Company established a12-month term for forecasting economic conditions followed by a24-month straight line reversion to historical average conditions as its basis for the probability of loan default. The probability of default rate is determined by reviewing loans with similar risk characteristics that are combined to form loan pools which are statistically correlated with historical credit losses, defaults and various economic metrics, including California Unemployment rates, California Housing Prices and California Gross Domestic Product. Pool balances that are determined to have probable default are then adjusted for expected loss given default. The Company selected the Frye Jacobs Index as its basis for Loss Given Default. Model forecasts* may*be adjusted for inherent limitations or biases that have been identified through independent validation and annual back-testing of model performance to actual realized results.

At* December 31, 2025,the Company utilized a reasonable and supportable forecast period offour* quarters and obtained the forecast data from publicly available sources. The Company also considered the impact of portfolio concentrations, changes in underwriting practices, and other risk factors that might influence its loss estimation process. Management believes that the allowance for credit losses at* December 31, 2025,*appropriately reflected expected credit losses inherent in the loan portfolio at that date.

In determining the allowance for credit losses, accruing loans with similar risk characteristics are generally evaluated collectively. The Company's policy is that loans designated as nonaccrualno longer share risk characteristics similar to other loans evaluated collectively and as such, all nonaccrual loans, in excess of*$100,000,* are individually evaluated for reserves. As of* December 31, 2025,and2024,* the Bank's nonaccrual loans comprised the entire population of loans individually evaluated. The Company's policy is that nonaccrual loans, in excess of*$100,000,* also represent the subset of loans where borrowers are experiencing financial difficulty where an evaluation of the source of repayment is required to determine if the nonaccrual loans should be categorized as collateral dependent. Nonaccrual loans with a balance less than or equal to*$100,000* are evaluated collectively and consist primarily of automobile loans.

The ACL includes expected credit losses over the contractual life of commitmentsnot identified as unconditionally cancellable by the Company. The Reserve for Unfunded Commitments is estimated using the same reserve or coverage rates calculated on collectively evaluated loans following the application of a funding rate to the amount of the unfunded commitment. The funding rate represents management's estimate of the amount of the current unfunded commitment that will be funded over the remaining contractual life of the commitment and is based on historical data. The ACL on unfunded loan commitment is included in Other Liabilities while any related provision expense is included in the provision for credit loss expense.

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Allowance for Credit Losses (continued)

The Company assigns a risk rating to all loans and periodically, butnot less than annually, performs detailed reviews of all criticized and classified loans over*$100,000* to identify credit risks and to assess the overall collectability of the portfolio. These risk ratings are also subject to examination by independent specialists engaged by the Company and the Company’s regulators. During these internal reviews, management monitors and analyzes the financial condition of borrowers and guarantors, trends in the industries in which borrowers operate and the fair values of collateral securing these loans. These credit quality indicators are used to assign a risk rating to each individual loan.

The risk ratings can be grouped intothree major categories, defined as follows:

Special Mention– Loans classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses* may*result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date.

Substandard– A substandard loan isnot adequately protected by the current sound worth and paying capacity of the borrower or the value of the collateral pledged, if any. Loans classified as substandard have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. Well defined weaknesses include a project's lack of marketability, inadequate cash flow or collateral support, failure to complete construction on time or the project's failure to fulfill economic expectations. They are characterized by the distinct possibility that the Company will sustain some loss if the deficiencies arenot corrected.

Doubtful– Loans classified doubtful have all the weaknesses inherent in those classified as substandard with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently known facts, conditions, and values, highly questionable and improbable.

Loansnot meeting the criteria above that are analyzed individually as part of the above-described process are considered to be pass-rated loans.

For other loans, which are primarily consumer loans and automobile loans the Company evaluates credit quality based on the aging status of the loan and by monitoring factors such as recent payment performance, borrower credit scores, and the frequency of extensions or payment deferrals.

The Company has identified the following portfolio segments to evaluate and measure the allowance for credit loss:

Commercial**–** Commercial loans are generally underwritten to existing cash flows of operating businesses. Debt coverage is provided by business cash flows and economic trends influenced by unemployment rates and other key economic indicators are closely correlated to the credit quality of these loans.

Agricultural – Loans secured by crop production and livestock are especially vulnerable totwo risk factors that are largely outside the control of the Company and borrowers: commodity prices and weather conditions.

Real Estate – Residential and Home Equity Lines of Credit**–** The degree of risk in residential real estate lending depends primarily on the loan amount in relation to collateral value, the interest rate and the borrower's ability to repay in an orderly fashion. These loans generally possess a lower inherent risk of loss than other real estate portfolio segments. Economic trends determined by unemployment rates and other key economic indicators are closely correlated to the credit quality of these loans. Weak economic trends indicate that the borrowers' capacity to repay their obligations* may*be deteriorating.

F-19

Allowance for Credit Losses (continued)

Real Estate – Commercial – Commercial real estate mortgage loans generally possess a higher inherent risk of loss than other real estate portfolio segments, except land and construction loans. Adverse economic developments or an overbuilt market impact commercial real estate projects and* may*result in troubled loans. Trends in vacancy rates of commercial properties impact the credit quality of these loans. High vacancy rates reduce operating revenues and the ability for properties to produce sufficient cash flow to service debt obligations.

Real Estate – Construction and Land Development – Construction and land development loans generally possess a higher inherent risk of loss than other real estate portfolio segments. A major risk arises from the necessity to complete projects within specified cost and timelines. Trends in the construction industry significantly impact the credit quality of these loans, as demand drives construction activity. In addition, trends in real estate values significantly impact the credit quality of these loans, as property values determine the economic viability of construction projects.

Automobile**–** An automobile loan portfolio is usually comprised of a large number of smaller loans scheduled to be amortized over a specific period. Most automobile loans are made directly for consumer purchases, but business vehicles* mayalso be included. Economic trends determined by unemployment rates and other key economic indicators are closely correlated to the credit quality of these loans. Weak economic trends indicate that the borrowers' capacity to repay their obligations may*be deteriorating.

Other – Other loans primarily consist of consumer loans and are similar in nature to automobile loans.

Although management believes the allowance to be adequate, ultimate losses* mayvary from its estimates. At least quarterly, the Board of Directors and management review the adequacy of the allowance, including consideration of the relative risks in the portfolio, current economic conditions and other factors. If the Board of Directors and management determine that changes are warranted based on those reviews, the allowance is adjusted. In addition, the Company's** *primary regulators, the FRB and the Department of Financial Protection and Innovation (DFPI), as an integral part of their examination process, review the adequacy of the allowance. These regulatory agencies mayrequire additions to the allowance based on their judgment about information available at the time of their examinations.

Purchased Credit Deteriorated (PCD) Loans

PCD loans are loans acquired at a discount that is due, in part, to credit quality deterioration since origination which* may*be determined through observation of missed payments, downgrade in risk rating, deterioration of a borrower's financial trends or other observable factors including subjectivity utilized by management. PCD loans are initially recorded at fair value, by taking the sum of the present value of expected future cash flows and an allowance for credit losses, at acquisition. The allowance for credit losses for PCD loans is recorded through a gross-up of reserves on the consolidated balance sheets, while the allowance for acquired non-PCD loans is recorded through the provision for credit losses on the consolidated statements of income, consistent with originated loans. Subsequent to acquisition, the allowance for credit losses for PCD loans will generally follow the same forward-looking estimation, provision, and charge-off process as non-PCD acquired and originated loans.

As part of the acquisition of Cornerstone on* July 1, 2025,*the Company acquired PCD loans. At acquisition, the Company recorded PCD loans at their purchase price and simultaneously established an allowance for credit losses based on expected credit losses over the life of the loans. A reconciliation of the purchase price of the PCD loans to the par value of these loans follows:

Reconciliation of Purchase Price to Par Value (in thousands):

The fair value of PCD loans acquired in the Cornerstone acquisition was determined using a discounted cash flow (DCF) model. Key inputs and assumptions included:

The resulting fair value represents the present value of expected future cash flows, net of credit losses, and includes a gross-up for the allowance for credit losses under ASC326.

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Non-PCD Loans

As part of the acquisition of Cornerstone, the Company acquired a portfolio of loan receivables that didnot exhibit credit deterioration at the acquisition date (non-PCD loans). In accordance with ASC805 and ASC326, these loans were initially recorded at fair value. An allowance for credit losses related to the non-PCD loans was recognized separately from the purchase price allocation, resulting in a charge to credit loss expense on the acquisition date. This treatment reflects the expected credit losses on the acquired loans and is consistent with the CECL model. The total fair value of non-PCD loans acquired was $432 million, the gross contractual amounts receivable is $579 million, and our best estimate of the contractual cash flowsnot expected to be collected is $6.7 million.

Other Real Estate Owned

Other real estate owned relates to real estate acquired in full or partial settlement of loan obligations. On* December 31, 2025,other real estate owned totaled $226,000 consisting oftwo residential real estate properties. On December 31, 2024,other real estate owned totaled $91,000 consisting ofone residential real estate property. There wasone agricultural loan with a balance of $2,000,000 secured by equipment, farmland anda small residential real estate property for which formal foreclosure proceedings were in process at December 31, 2025* There wasone commercial loan with a balance of $53,000 secured by a residential real estate property for which formal foreclosure proceedings were in process at* December 31, 2024*. Proceeds from sales of other real estate owned totaled $22,000, $362,000 and $122,000 for the years ended* December 31, 2025,2024 and2023, respectively. For the years ended December 31, 2025,*2024 and2023 the Company recorded gains on sale of other real estate owned of $0, $5,000 and $39,000, respectively. Other real estate owned is initially recorded at fair value less cost to sell when acquired. Any excess of the Bank's recorded investment in the loan balance and accrued interest income over the estimated fair value of the property less costs to sell is charged against the allowance for credit losses. A valuation allowance for losses on other real estate is maintained to provide for temporary declines in value. The allowance is established through a provision for losses on other real estate which is included in other expenses. Subsequent gains or losses on sales or write-downs resulting from permanent impairment are also recorded in other expenses as incurred.

The following table provides a summary of the change in the OREO balance for the years ended* December 31, 2025and2024*:

Intangible Assets

Intangible assets consist of core deposit intangibles related to the acquisition of Cornerstone Community Bancorp, Feather River Bancorp and branch acquisitions and are amortized on an accelerated basis method overten years. The Company evaluates the recoverability and remaining useful life annually to determine whether events or circumstances warrant a revision to the intangible asset or the remaining period of amortization. There wereno such events or circumstances during the periods presented.

Aggregate amortization expense was $1,300,000, $201,000, and $237,000 for2025,2024 and2023, respectively.2025, 2024 and2023

The gross carrying amount of intangible assets and accumulated amortization was:

Estimated amortization expense for each of the nextfive years is$2,235,000, $1,990,000, $1,742,000, $1,479,000 and $1,244,000.

Goodwill

Goodwill totaling $18,713,000 was recorded on* July 1, 2025,related to the acquisition of Cornerstone Community Bancorp resulting in total Goodwill of $24,215,000 at December 31, 2025.Goodwill isnot* amortized but is evaluated for impairment at least annually including during thefourth quarter of2025. The Company didnot recognize impairment during the years ended* December 31, 2025,*2024 and2023.

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Premises and Equipment

Land is carried at cost. Premises and equipment are stated at cost less accumulated depreciation. Depreciation is determined using the straight-line method over the estimated useful lives of the related assets. The useful lives of premises are estimated to betwenty tothirty years. The useful lives of furniture, fixtures and equipment are estimated to betwo toten years. Leasehold improvements are amortized over the life of the asset or the life of the related lease, whichever is shorter. When assets are sold or otherwise disposed of, the cost and related accumulated depreciation or amortization are removed from the accounts, and any resulting gain or loss is recognized in income for the period. The cost of maintenance and repairs is charged to expense as incurred. The Company evaluates premises and equipment for financial impairment as events or changes in circumstances indicate that the carrying amount of such assets* may**not* be fully recoverable.

Bank Owned Life Insurance

The Company has purchased life insurance policies on certain key executives. Bank owned life insurance is recorded at the amount that can be realized under the insurance contract at the balance sheet date, which is the cash surrender value adjusted for other charges or other amounts due that are probable at settlement.

Revenue from Contracts with Customers

The Company records revenue from contracts with customers in accordance with Accounting Standards Codification Topic606, “Revenue from Contracts with Customers” (“Topic606”). Under Topic606, the Company must identify the contract with a customer, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to the performance obligations in the contract, and recognize revenue when (or as) the Company satisfies a performance obligation. Significant revenue hasnot been recognized in the current reporting period that results from performance obligations satisfied in previous periods.

Most of our revenue-generating transactions arenot subject to Topic606, including revenue generated from financial instruments, such as our loans and investment securities. The Company has evaluated the nature of its contracts with customers and determined that further disaggregation of revenue from contracts with customers into more granular categories beyond what is presented in the Consolidated Statements of Income wasnot necessary. The Company generally fully satisfies its performance obligations on its contracts with customers as services are rendered and the transaction prices are typically fixed, charged either on a periodic basis or based on activity. Because performance obligations are satisfied as services are rendered and the transaction prices are fixed, there is little judgment involved in applying Topic606 that significantly affects the determination of the amount and timing of revenue from contracts with customers.

The following are descriptions of significant revenues within the scope of ASC606.

Deposit service charges

The Company earns fees from its deposit customers for account maintenance, transaction-based and overdraft services. Account maintenance fees consist primarily of account fees and analyzed account fees charged on deposit accounts on a monthly basis. The performance obligation is satisfied, and the fees are recognized on a monthly basis as the service period is completed. Transaction-based fees on deposit accounts are charged to deposit customers for specific services provided to the customer, such as non-sufficient funds fees, overdraft fees, and wire fees. The performance obligation is completed as the transaction occurs and the fees are recognized at the time each specific service is provided to the customer.

Debit card interchange fees

Debit card interchange income represents fees earned when a debit card issued by the Company is used. The Company earns interchange fees from debit cardholder transactions through the Visa payment network. Interchange fees from cardholder transactions represent a percentage of the underlying transaction value and are recognized daily, concurrently with the transaction processing services provided to the cardholder. The performance obligation is satisfied, and the fees are earned when the cost of the transaction is charged to the cardholders’ debit card. Certain expenses directly associated with the credit and debit card are recorded on a net basis with the interchange income.

Low Income Housing Tax Credits

The Company accounts for low-income housing tax credits and the related qualified affordable housing projects using the proportional amortization method. Under the proportional amortization method, the Company amortizes the initial cost of the investment in proportion to the tax credits and other tax benefits received and recognizes the net investment performance in the income statement as a component of income tax expense (benefit). Upon entering into a qualified affordable housing project, the Company records, in other liabilities, the entire amount that it has agreed to invest in the project, and an equal amount, in other assets, representing its investment in the project. As the Company disburses cash to satisfy its investment obligation, other liabilities are reduced. Over time, as the tax credits and other tax benefits of the project are realized by the Company, the investment recorded in other assets is reduced using the proportional amortization method.

F-22

Purchased Transferable Green‑Energy Tax Credits

The Company* maypurchase transferable green‑energy tax credits from third‑party project developers pursuant to the transferability provisions of the Inflation Reduction Act of2022.* Purchased tax credits are accounted for in accordance with ASC740, Income Taxes.

Purchased transferable tax credits are recorded as an income tax‑related asset at the amount of cash consideration paid at the date the Company obtains control of the credits. The asset is subsequently recognized as a reduction of income tax expense in the period in which the credits are utilized to offset the Company’s federal income tax liability. Purchased credits donot give rise to deferred tax assets or liabilities and arenot amortized.

The Company evaluates the realizability of purchased credits each reporting period based on expected taxable income and statutory expiration dates. If it is more likely thannot that any portion of the purchased credits willnot be realized, the carrying amount is reduced and a corresponding charge is recorded within the Provision for income taxes in the consolidated statements of income. The Company assesses whether any uncertain tax positions exist related to the eligibility or utilization of purchased credits under the guidance in ASC740‑10. Any such amounts are recorded as liabilities for unrecognized tax benefits when appropriate.

Purchased credits are classified within Accrued interest receivable and other assets. Cash paid for the acquisition of purchased transferable credits is presented within Operating activities in the Consolidated Statements of Cash Flows.

Income Taxes

The Company files its income taxes on a consolidated basis with its subsidiary. Income tax expense is the total of current year income tax due or refundable and the change in deferred tax assets and liabilities.

Deferred tax assets and liabilities are recognized for the tax consequences of temporary differences between the reported amount of assets and liabilities and their tax bases. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. A valuation allowance is recognized if, based on the weight of available evidence management believes it is more likely thannot that some portion or all of the deferred tax assets willnot be realized. On the consolidated balance sheet, net deferred tax assets are included in accrued interest receivable and other assets.

Accounting for Uncertainty in Income Taxes

When tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that would be ultimately sustained. The benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more likely thannot that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken arenot offset or aggregated with other positions. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than50 percent likely of being realized upon settlement with the applicable taxing authority. The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above is reflected as a liability for unrecognized tax benefits in the accompanying balance sheet along with any associated interest and penalties that would be payable to the taxing authorities upon examination.

Interest expense and penalties associated with unrecognized tax benefits, if any, are classified as income tax expense in the consolidated income statement. There have beenno significant changes to unrecognized tax benefits or accrued interest and penalties for the years ended* December 31, 2025and2024*.

Earnings Per Share

Basic earnings per share (EPS), which excludes dilution, is computed by dividing income available to common stockholders (net income plus discount on redemption of preferred stock less preferred dividends and accretion) by the weighted-average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock, such as stock options, result in the issuance of common stock which shares in the earnings of the Company. The treasury stock method has been applied to determine the dilutive effect of stock options in computing diluted EPS.

Comprehensive Income

Comprehensive income consists of net income and other comprehensive income. Other comprehensive income includes unrealized gains and losses on securities available for sale and unrealized gains on cash flow hedges and fair value hedges which are also recognized as separate components of equity. The amount related to the fair value hedge presented in other comprehensive income represents the basis adjustment to the hedged investment securities attributable to changes in fair value resulting from the hedged risk. The amount reclassified out of other accumulated comprehensive income relating to realized losses on securities available for sale was $5,811,000, $19,817,000 and $0 for2025, 2024 and2023, with the related tax benefit of $1,718,000, $5,858,000 and $0, respectively. During2025 the amount reclassified out of other accumulated comprehensive income relating to realized losses on fair value hedges was $254,000 with the related tax expense of $75,000. During2023 the amount reclassified out of other accumulated comprehensive income relating to realized losses on cash flow hedges was $1,707,000 with the related tax expense of$505,000.

Dividend Restrictions

Banking regulations require maintaining certain capital levels and* may*limit the dividend paid by the bank to the holding company or by the holding company to shareholders.

F-23

Fair Value of Financial Instruments

Fair values of financial instruments are estimated using relevant market information and other assumptions, as more fully disclosed in a separate note. Fair value estimates involve uncertainties and matters of significant judgment regarding interest rates, credit risk, prepayments, and other factors, especially in the absence of broad markets for particular items. Changes in assumptions or in market conditions could significantly affect these estimates.

Stock-Based Compensation

Compensation expense related to the Company’s Stock based compensation plans, net of related tax benefit, recorded in2025, 2024 and2023 totaled $320,000, $450,000 and $300,000 or $0.05, $0.08 and $0.05 per diluted share, respectively. Compensation expense is recognized over the vesting period on a straight-line accounting basis.

The Company determines the fair value of options on the date of grant using a Black-Scholes-Merton option pricing model that uses assumptions based on expected option life, expected stock volatility and the risk-free interest rate. The expected volatility assumptions used by the Company are based on the historical volatility of the Company’s common stock over the most recent period commensurate with the estimated expected life of the Company’s stock options. The Company bases its expected life assumption on its historical experience and on the terms and conditions of the stock options it grants to employees. The risk-free rate is based on the U.S. Treasury yield curve for the periods within the contractual life of the options in effect at the time of the grant.

No stock options were granted in2023, andno restricted stock units or restricted stock were granted in2025 or2023.

During thetwelve months ended* December 31, 2025and2024* the Company granted options to purchase 30,803 and 107,200 shares, respectively of common stock. The fair value of each option was estimated on the date of grant using the following assumptions.

Pending Accounting Pronouncements

Accounting Standards Update2024*-03 “Income Statement Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic220-40):In November 2024,the FASB amended the Income Statement—Reporting Comprehensive Income topic in the Accounting Standards Codification to require public companies to disclose, in interim and annual reporting periods, additional information about certain expenses in the notes to financial statements. The amendments are effective for annual periods beginning after December 15, 2026,and interim reporting periods beginning after December 15, 2027.Early adoption is permitted. The Company doesnot* expect these amendments to have a material effect on its financial statements.

Accounting Standards Update2025*-08 “Financial Instruments — Credit Losses (Topic326*): Purchased Loans*:In November 2025,the FASB amended the Financial Instruments—Credit Losses topic in the Accounting Standards Codification to expand the population of acquired financial assets subject to the gross-up approach. The amendments are effective for annual reporting periods beginning after December 15, 2026,and interim reporting periods within those annual reporting periods. Early adoption is permitted in both interim and annual reporting periods in which financial statements havenot* yet been issued or made available for issuance. The Company doesnot expect these amendments to have a material effect on its financial statements.

Impact of Recently Issued Accounting Pronouncements

Accounting Standards Update2023*-09 “Income Taxes (Topic740) - Improvements to Income Tax Disclosures*”(“ASU2023*-09*”):In December 2023,the FASB amended the Income Taxes topic in the Accounting Standards Codification to improve the transparency of income tax disclosures. ASU2023-09 was effective* January 1, 2025and didnot* have a significant impact on the Company's financial statements.

Accounting Standards Update2024*-02 “Codification Improvements” (“ASU2024*-02): In* March 2024,the FASB issued amendments to the Codification that remove references to various FASB Concepts Statements. ASU2024*-02 was effective* January 1, 2025and didnot* have a significant impact on the Company's financial statements.

F-24

The Company measures fair value under the fair value hierarchy described below.

Level1: Quoted prices for identical instruments traded in active exchange markets.

Level2: Quoted prices (unadjusted) for similar instruments in active markets, quoted prices for identical or similar instruments in markets that arenot active and model-based valuation techniques for which all significant assumptions are observable or can be corroborated by observable market data.

Level3: Model based techniques that useone significant assumptionnot observable in the market. These unobservable assumptions reflect the Company’s estimates of assumptions that market participants would use on pricing the asset or liability. Valuation techniques include management's judgment and estimation which* may*be significant.

In certain cases, the inputs used to measure fair value* may*fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls, has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

Management monitors the availability of observable market data to assess the appropriate classification of financial instruments within the fair value hierarchy. Changes in economic conditions or model-based valuation techniques* mayrequire the transfer of financial instruments fromone* fair value level to another. In such instances, the transfer is reported at the beginning of the reporting period.

Management evaluates the significance of transfers between levels based upon the nature of the financial instrument and size of the transfer relative to total assets, total liabilities or total earnings.

F-25

Fair Value of Financial Instruments

The carrying amounts and estimated fair values of financial instruments, at* December 31, 2025* are as follows (in dollars):

The carrying amounts and estimated fair values of financial instruments, at* December 31, 2024* are as follows (in dollars):

The methods and assumptions used to estimate the fair value of each class of financial instrumentsnot measured at fair value are as follows:

Loans - Loans are generally valued by discounting expected cash flows using market inputs with adjustments based on cohort level assumptions for certain loan types as well as internally developed estimates at a business segment level. Due to the significance of the unobservable market inputs and assumptions, as well as the absence of a liquid secondary market for most loans, these loans are classified as Level3. Nonaccrual loans are written down and reported at their estimated recovery value which approximates their fair value and classified as Level3.

Time deposits - The fair value of time deposits was estimated based on a discounted cash flow technique using Level2 inputs appropriate to the contractual maturity.

Repurchase agreements - The fair value of the repurchase agreement is based on Level2 inputs. The primary inputs used in the valuation include the market interest rate and the credit quality of the underlying securities.

Borrowings - The cash flows were calculated using the contractual features of the borrowing and then discounted using observable market rates using Level2 inputs appropriate to the contractual maturity.

Becauseno market exists for a significant portion of the Company's financial instruments, fair value estimates are based on judgments regarding current economic conditions, risk characteristics of various financial instruments and other factors. Those estimates that are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision are included in Level3. Changes in assumptions could significantly affect the fair values presented.

These estimates donot reflect any premium or discount that could result from offering the Company's entire holdings of a particular financial instrument for sale atone time, nor do they attempt to estimate the value of anticipated future business related to the instruments. In addition, the tax ramifications related to the realization of unrealized gains and losses can have a significant effect on fair value estimates and havenot been considered in any of these estimates.

F-26

Fair Value of Financial Instruments (continued)

Assets and liabilities measured at fair value on a recurring basis at* December 31, 2025* are summarized below:

Assets and liabilities measured at fair value on a recurring basis at* December 31, 2024* are summarized below:

The fair value of securities available-for-sale equals quoted market price, if available. If quoted market prices arenot available, fair value is determined using quoted market prices for similar securities or matrix pricing. There wereno changes in the valuation techniques used during2025 or2024. Transfers between hierarchy measurement levels are recognized by the Company as of the beginning of the reporting period. Changes in fair market value are recorded in other comprehensive income (loss).

F-27

** **PLUMAS BANCORP AND SUBSIDIARY

Assets and liabilities measured at fair value on a non-recurring basis at* December 31, 2025*, are summarized below:

Assets and liabilities measured at fair value on a non-recurring basis at* December 31, 2024,*are summarized below:

F-28

The Company hasno liabilities which are reported at fair value.

The following methods were used to estimate fair value.

Collateral-Dependent Loans: The Bank doesnot record loans at fair value on a recurring basis. However, from time to time, fair value adjustments are recorded on these loans to reflect partial write-downs, through charge-offs or specific reserve allowances, that are based on fair value estimates of the underlying collateral. The fair value estimates for collateral-dependent loans are generally based on recent real estate appraisals or broker opinions, obtained from independentthird parties, which are frequently adjusted by management to reflect current conditions and estimated selling costs (Level3). Impairment charges of $1,487,000 were recognized during thetwelve months ended* December 31, 2025,related to collateral dependent loans. Impairment charges of $1,000 were recognized during thetwelve* months ended* December 31, 2024,related to collateral dependent loans. The collateral-dependent loans at December 31, 2025and December 31, 2024*consist solely of loans which had been allocated a specific credit reserve.

Other Real Estate: Nonrecurring adjustments to certain real estate properties classified as other real estate owned are measured at the lower of carrying amount or fair value, less costs to sell. In cases where the carrying amount exceeds the fair value, less costs to sell, an impairment loss is recognized. Fair values are generally based onthird party appraisals of the property which are commonly adjusted by management to reflect current conditions and selling costs (Level3).

Appraisals for both collateral-dependent loans and other real estate are performed by certified general appraisers (for commercial properties) or certified residential appraisers (for residential properties) whose qualifications and licenses have been reviewed and verified by the Company. Once received, a member of the Loan Administration Department reviews the assumptions and approaches utilized in the appraisal as well as the overall resulting fair value in comparison with independent data sources such as recent market data or industry-wide statistics. On a quarterly basis, the Company compares the actual selling price of similar collateral that has been liquidated to the most recent appraised value for unsold properties to determine what additional adjustment, if any, should be made to the appraisal value to arrive at fair value. Adjustments are routinely made in the appraisal process by the independent appraisers to adjust for differences between the comparable sales and income data available.

The following table presents quantitative information about Level3 fair value measurements for financial instruments measured at fair value on a non-recurring basis at* December 31, 2025and2024* (dollars in thousands):

F-29

The amortized cost and estimated fair value of investment securities at* December 31, 2025and2024* consisted of the following:

Unrealized losses on available-for-sale investment securities totaling $14,895,000 were recorded, net of $4,404,000 in tax benefits, as accumulated other comprehensive loss within shareholders' equity at* December 31, 2025*. During thetwelve months ended* December 31, 2025,*the Company sold 135 available-for-sale investment securities for proceeds of $130,635,000 recording a $6,065,000 net loss on sale. The loss was partially offset by a gain of $254,000 on the termination of a fair value hedge. The Company realized a gain on sale from 15 of these securities totaling $36,000 and a loss on sale of 120 securities totaling $6,101,000.

Unrealized losses on available-for-sale investment securities totaling $35,698,000 were recorded, net of $10,552,000 in tax benefits, as accumulated other comprehensive loss within shareholders' equity at* December 31, 2024.During thetwelve* months ended* December 31, 2024,*the Company sold 157 available-for-sale investment securities for proceeds of $116,285,000 recording a $19,817,000 net loss on sale. The Company realized a gain on sale fromten of these securities totaling $115,000 and a loss on sale of 147 securities totaling $19,932,000.

Unrealized losses on available-for-sale investment securities totaling $46,088,000 were recorded, net of $13,624,000 in tax benefits, as accumulated other comprehensive loss within shareholders' equity at* December 31, 2023.No investment securities were sold during the year ended December 31, 2023.*

Investment securities with unrealized losses at* December 31, 2025* are summarized and classified according to the duration of the loss period as follows:

F-30

Investment securities with unrealized losses at* December 31, 2024* are summarized and classified according to the duration of the loss period as follows:

At* December 31, 2025*, the Company held 295 securities of which 12 were in a loss position for less thantwelve months and 123 were in a loss position fortwelve months or more. Of the 135 securities in a loss position 42 are U.S. Government-sponsored agencies collateralized by residential mortgage obligations,24 are U.S. Government agencies collateralized by commercial mortgage obligations and 69 are obligations of states and political subdivisions. The unrealized losses relate to market rate conditions. All of the securities continue to pay as scheduled. For available-for-sale debt securities in an unrealized loss position, the Companyfirst assesses whether it intends to sell, or it is more likely thannot that it will be required to sell the security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the security's amortized cost basis is written down to fair value through income. At* December 31, 2025,*neither of the criteria regarding intent or requirement to sell was met for any of the securities in an unrealized loss position.

Unrealized losses on investments in obligations of U.S. government agencies and U.S. government sponsored agencies are caused by interest rate increases.

Obligations of states and political subdivisions: Management reviewed the collectability of the obligations of the states and political subdivisions taking into consideration such factors as the financial condition of the issuers, credit ratings, and other information. Management believes the unrealized losses on the obligations of states and political subdivisions are attributable to changes in the investment spreads and interest rates andnot changes in the credit quality of the issuers.

The amortized cost and estimated fair value of investment securities at* December 31, 2025* by contractual maturity are shown below. Expected maturities will differ from contractual maturities because the issuers of the securities* may*have the right to call or prepay obligations with or without call or prepayment penalties.

Investment securities with amortized costs totaling $354,819,000 and $225,313,000 and estimated fair values totaling $347,675,000 and $212,001,000 at* December 31, 2025and2024*, respectively, were pledged to secure deposits and repurchase agreements. Investment securities with amortized costs totaling $45,639,000 and $131,876,000 and estimated fair values totaling $40,682,000 and $120,060,000 at* December 31, 2025and2024*, respectively, were pledged at the Federal Reserve Bank Discount Window. No borrowings were outstanding on* December 31, 2025and2024,* at the Discount Window.

There wereno transfers of available-for-sale investment securities during the years ended* December 31, 2025*,2024 or2023. There wereno securities classified as held-to-maturity at* December 31, 2025* or* December 31, 2024*.

F-31

Outstanding loans are summarized below:

Salaries and employee benefits totaling $3,031,000, $2,697,000 and $2,283,000 have been deferred as loan origination costs during the years ended* December 31, 2025,*2024 and2023, respectively.

F-32

The following table shows the loan portfolio allocated by management's internal risk ratings or payment activity at* December 31, 2025*:

F-33

F-34

The following table shows the ending balance of nonaccrual loans by loan category as of the date indicated:

The Company places loans90 days or more past due on nonaccrual status unless the loan is well secured and in the process of collection. A loan is considered to be in the process of collection if, based on a probable specific event, it is expected that the loan will be repaid or brought current. Generally, this collection period wouldnot exceed90 days. When a loan is placed on nonaccrual status the Company's general policy is to reverse and charge against current income previously accrued but unpaid interest. Interest income on such loans is subsequently recognized only to the extent that cash is received, and future collection of principal is deemed by management to be probable. Where the collectability of the principal or interest on a loan is considered to be doubtful by management, it is placed on nonaccrual status prior to becoming90 days delinquent.

At* December 31, 2025*, there werefour nonaccrual commercial loans with an amortized cost of $152,000 that had allowance for credit losses totaling $68,000 andfive nonaccrual agricultural loans with an amortized cost of $3,352,000 that had allowance for credit losses totaling $1,448,000. At* December 31, 2024,there wasone* nonaccrual commercial loan with an amortized cost of $55,000 that had allowance for credit losses totaling $29,000. No income was recognized on nonaccrual loans accounted on a cash basis during thetwelve months ended* December 31, 2025*, or the year ended* December 31, 2024*.

The following tables show interest reversed against interest income for loans placed on nonaccrual status during thetwelve months ended* December 31, 2025,*2024 and2023.

The following tables present the amortized cost basis of collateral dependent loans by class of loans at* December 31, 2025*, in thousands:

F-35

The following tables present the amortized cost basis of collateral dependent loans by class of loans at* December 31, 2024,*in thousands:

The following table presents the amortized cost basis of loans on* December 31, 2025*, that were both experiencing financial difficulty and modified during thetwelve months ended* December 31, 2025*, by class and by type of modification. The percentage of the amortized cost basis of loans that were modified to borrowers in financial distress as compared to the amortized cost basis of each class of financial receivable is also presented below.

The following table presents the financial effect of the loan modifications presented above to borrowers experiencing financial difficulty as of* December 31, 2025:*

The following table presents the amortized cost basis of loans on* December 31, 2024,that were both experiencing financial difficulty and modified during thetwelve* months ended* December 31, 2024,*by class and by type of modification. The percentage of the amortized cost basis of loans that were modified to borrowers in financial distress as compared to the amortized cost basis of each class of financial receivable is also presented below.

The following table presents the financial effect of the loan modifications presented above to borrowers experiencing financial difficulty as of* December 31, 2024:*

F-36

The following table presents the amortized cost basis of loans on* December 31, 2023,that were both experiencing financial difficulty and modified during thetwelve* months ended* December 31, 2023,*by class and by type of modification. The percentage of the amortized cost basis of loans that were modified to borrowers in financial distress as compared to the amortized cost basis of each class of financial receivable is also presented below.

The following table presents the financial effect of the loan modifications presented above to borrowers experiencing financial difficulty as of* December 31, 2023:*

Loans with payment defaults by borrowers experiencing financial difficulty during thetwelve months ended* December 31, 2025,which had material modifications in rate, term or principal forgiveness during thetwelve* months prior to default, totaled $6.9 million in agricultural loans of which four totaling $4.9 million were past due 199 days andone totaling $2 million which was past due 260 days at* December 31, 2025andone commercial real estate loan totaling $73,000 which was 44 days past due at December 31, 2025.The agricultural loans were related toone* borrower. Loans with payment defaults by borrowers experiencing financial difficulty during thetwelve months ended* December 31, 2024,which had material modifications in rate, term or principal forgiveness during thetwelve* months prior to default, totaled $4.3 million in agricultural loans which werenot past due at* December 31, 2024,andone commercial loan totaling $30,000 which was 70 days past due at December 31, 2024.There wereno loan payment defaults by borrowers experiencing financial difficulty during thetwelve* months ended* December 31, 2023,which had material modifications in rate, term or principal forgiveness during thetwelve* months prior to default.

The following tables show an aging analysis of the loan portfolio by the time past due, in thousands:

F-37

The following tables show the allocation of the allowance for credit losses at the dates indicated, in thousands:

The following tables summarize the activity in the reserve for unfunded commitments which is recorded on the balance sheet within other liabilities for thetwelve months ended* December 31, 2025,and2024.*

F-38

Premises and equipment consisted of the following:

Depreciation and amortization included in occupancy and equipment expense totaled $1,535,000, $1,295,000 and $1,430,000 for the years ended* December 31, 2025,*2024 and2023, respectively.

Interest-bearing deposits consisted of the following:

At* December 31, 2025*, the scheduled maturities of time deposits were as follows:

Deposit overdrafts reclassified as loan balances were $859,000 and $524,000 at* December 31, 2025and2024*, respectively.

F-39

Securities sold under agreements to repurchase totaling $97,855,000 and $22,073,000 at* December 31, 2025and2024*, respectively, are secured by U.S. Government agency securities with a carrying amount of $112,059,000 and $38,461,000 at* December 31, 2025and2024*, respectively.

Securities sold under agreements to repurchase are financing arrangements that mature withintwo years. At maturity, the securities underlying the agreements are returned to the Company. Information concerning securities sold under agreements to repurchase during2025 and2024 is summarized as follows:

The Company is a member of the FHLB and can borrow up to $400 million from the FHLB secured by commercial and residential mortgage loans with carrying values totaling $659 million. The Company is required to hold FHLB stock as a condition of membership. At* December 31, 2025*, the Company held $8.8 million of FHLB stock which is recorded as a component of other assets. Based on its current level of FHLB stock holdings the Company can borrow up to $326 million. To borrow the full $400 million in available credit the Company would need to purchase $2 million in additional FHLB stock. At* December 31, 2025*the Company could borrow up to $39 million at the FRB Discount Window secured by investment securities with amortized costs totaling $45,639,000 and estimated fair values totaling $40,682,000.

In addition to its FHLB borrowing line and collateralized borrowings at the FRB Discount Window, the Company has unsecured short-term borrowing agreements withtwo of its correspondent banks in the amounts of $50 million and $20 million. There wereno outstanding borrowings to the FHLB, FRB or the correspondent banks at* December 31, 2025*, and* December 31, 2024*.

On* January 25, 2022the Company replaced its $15 million line of credit facility with a $15 million Loan Agreement (the “Loan Agreement”) and Promissory Note (the “Term Note”). The Term Note matures on January 25, 2035,and can be prepaid at any time. During the initialthree* years of the Loan Agreement the Term Note functions as an interest only revolving line of credit. On* February 1, 2025the Term Note converted into a term loan requiring semi-annual interest payments and annual principal reductions.No further advances can be made. The proceeds of this lending facility shall be used by the Company for general corporation purposes, and to provide capital injections into the Bank. The Term Note bears interest at a fixed rate of 3.85% for thefirst* 5 years and then beginning* January 25,2027 at a floating interest rate linked to WSJ Prime Rate for the remainingeight year term. The Loan Agreement provides for a $187,500 loan fee. The Note is secured by the common stock of the Bank. The Loan Agreement contains certain financial and non-financial covenants, which include, but arenot limited to, a minimum leverage ratio at the Bank, a minimum total risk-based capital ratio at the Bank, a maximum Texas Ratio at the Bank, a minimum level of Tier1 capital at the Bank and a return on average assets needed to generate a1.25X debt service coverage ratio. The Loan Agreement also contains customary events of default, including, butnot limited to, failure to pay principal or interest, the commencement of certain bankruptcy proceedings, and certain adverse regulatory events affecting the Company or the Bank. Upon the occurrence of an event of default under the Loan Agreement, the Company’s obligations under the Loan Agreement maybe accelerated. In March 2023the Company borrowed $10 million on this note and during Januaryof2024* the Company borrowed an additional $5 million under this note for general corporate purposes, resulting in an ending balance at* December 31, 2025,of $15 million. The Company was in compliance with all covenants related to the Term Note at December 31, 2025*. Interest expense recognized on the Term Note for thetwelve months ended* December 31, 2025*,2024 and2023 totaled $585,000, $641,000 and $369,000, respectively.

As a result of and upon the completion of the Merger, the Company assumed Cornerstone’s obligations with respect to an aggregate principal amount of $12 million of subordinated notes, comprised of (a) $2 million in aggregate principal amount of 4.75% Fixed to Floating Rate Subordinated Notes due* November 30, 2035 (the“2035* Notes”) and (b) $10 million in aggregate principal amount of 4.75% Fixed-to-Floating Rate Subordinated Notes due* November 30, 2030 (the“2030* Notes”). The2035 Notes, which were issued in2020, have a fixed interest rate of 4.75% for thefirst ten years and thereafter a quarterly variable interest rate equal to the then currentthree-month term Secured Overnight Financing Rate (“SOFR”) plus 4.14%. The2030 Notes, which were issued in2020, had a fixed interest rate of 4.75% for thefirst five years and thereafter a quarterly variable interest rate equal to the then currentthree-month term SOFR plus 4.52%. The2030 notes were called for redemption on* December 30, 2025.Of the $10 million originally outstanding on the2030* notes, principal payments were made on $5.8 million while $4.2 million remain outstanding at* December 31, 2025.The remaining $4.2 million will be paid once the notes are surrendered for cancelation by the debenture holders as required under the2030* Notes. In accordance with the terms of the2030 Notes interest has ceased to accrue on the remaining $4.2 million. Interest expense recognized on the subordinated notes for thetwelve months ended* December 31, 2025,*was $426 thousand.

F-40

On* January 19, 2024,Plumas Bank entered into an agreement for the purchase and sale of real property (the “Sale Agreement”). The Sale Agreement provided for the sale to MountainSeed ofnine properties owned and operated by Plumas Bank as branches for an aggregate cash purchase price of approximately $25.7 million. The sale was completed on February 14, 2024*resulting in a net gain on sale of $19.9 million, recording of right-of-use assets totaling $22.3 million and recording a lease liability of $22.3 million.

Concurrently with the closing of the sale of the branch properties, we entered into triple net lease agreements (the “Lease Agreements”) pursuant to which Plumas Bank leased back each of the properties sold. Each Lease Agreement has an initial term offifteen years withone 15-year renewal option. The Lease Agreements provide for an annual rent of approximately $2.4 million in the aggregate for thenine properties increased bytwo percent (2%) per annum for each year during the initial Term. During the renewal term, the initial rent will be the basic rent during the last year of the initial term, increased bytwo percent (2%) per annum for each year during the renewal term.

On* March 28, 2025,Plumas Bank entered into an agreement for the purchase and sale of real property (the “Purchase Agreement”). The Purchase Agreement as amended provided for the sale to BBS Branch III, LLC, a Delaware limited liability company,two administrative buildings located in Quincy California for an aggregate cash purchase price of $5.5 million. The sale was completed on November 19, 2025,*resulting in a net gain on sale of $5.5 million, recording of right-of-use assets totaling $5.3 million and recording a lease liability of $4.7 million.

Concurrent with the closing of the sale, Plumas Bank and Plumas Investor, LLC, a Delaware limited liability company and Plumas Quincy, LLC, a Delaware limited liability company entered into triple net lease agreements (the “Lease Agreements”) pursuant to which the Bank will lease back the Properties sold. The Lease Agreements have an initial term of 15 years with three five-year renewal options. The Lease Agreements provide for annual rent of approximately $463,000 in the aggregate for both Properties, increasing bythree percent per annum each year.

The Company leasestwo lending offices,eleven branch offices including thenine branches sold and leased back in2024, the land under our Yuba City branch,five administrative offices andthree standalone ATM locations. The branch office leases, the administrative office leases described above, and the land lease have options to renew. The exercise of lease renewal options is at our sole discretion; therefore, they arenot included in our Right of Use (ROU) assets and lease liabilities as they arenot reasonably certain of exercise. We regularly evaluate the renewal options and when they are reasonably certain of exercise, we include the renewal period in our lease term. We have elected the practical expedient to exclude short-term leases from our ROU assets and lease liabilities. The branch leases, the administrative office leases, the land lease andone of the lending office leases are classified as operating leases while the remaining leases are all short-term leases. Right of use assets totaling $28,860,000 and $24,334,000 at* December 31, 2025and2024*, respectively were included on the consolidated balance sheets. Lease liabilities totaling $29,029,000 and $24,759,000 at* December 31, 2025and2024*, respectively were included on the consolidated balance sheets.

For all leases, other than the leases entered into on* November 19, 2025,described above, we use our incremental borrowing rate based on the information available at the lease commencement date in determining the present value of the lease payments. For thetwo* office building leases entered into on* November 19, 2025,we used the implicit rate provided by the lessor in determining the present value of the lease payments. The Company’s weighted average rate used in the calculation of the right-of-use assets and lease liabilities was estimated at 8.3% for the years ending December 31, 2025,and2024.*

The following table presents a maturity analysis of the operating lease liability at* December 31, 2025*:

The weighted-average remaining lease term was 13.5 years and 14.3 years for the years ended* December 31, 2025,and2024,* respectively.

Total lease costs for the year ended* December 31, 2025* were $3,584,000 consisting of $3,469,000 related to operating leases, $54,000 related to short-term leases and variable lease expense of $61,000. Total lease costs for the year ended* December 31, 2024* were $3,064,000 consisting of $3,004,000 related to operating leases, $29,000 related to short-term leases and variable lease expense of $31,000. Cash paid on operating leases was $3,095,000 and $2,655,000 for the years ended* December 31, 2025and2024*, respectively.

Rental expense included in occupancy and equipment expense totaled $3,523,000, $3,033,000 and $599,000 for the years ended* December 31, 2025,*2024 and2023, respectively.

F-41

Financial Instruments With Off-Balance-Sheet Risk

The Company is a party to financial instruments with off-balance-sheet risk in the normal course of business in order to meet the financing needs of its customers. These financial instruments include commitments to extend credit and letters of credit. These instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized on the consolidated balance sheet.

The Company's exposure to credit loss in the event of nonperformance by the other party for commitments to extend credit and letters of credit is represented by the contractual amount of those instruments. The Company uses the same credit policies in making commitments and letters of credit as it does for loans included on the consolidated balance sheet.

The following financial instruments represent off-balance-sheet credit risk, in thousands:

Commitments to extend credit are agreements to lend to a customer as long as there isno violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and* mayrequire payment of a fee. Since some of the commitments are expected to expire without being drawn upon, the total commitment amounts donot* necessarily represent future cash requirements. The Company evaluates each customer's creditworthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Company upon extension of credit, is based on management's credit evaluation of the borrower. Collateral held varies, but* may*include accounts receivable, crops, inventory, equipment, income-producing commercial properties, farmland and residential properties.

Letters of credit are conditional commitments issued by the Company to guarantee the performance of a customer to athird party. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loans to customers. The fair value of the liability related to these letters of credit, which represents the fees received for issuing the guarantees, wasnot significant at* December 31, 2025and2024*. The Company recognizes these fees as revenues over the term of the commitment or when the commitment is used.

At* December 31, 2025*, consumer loan commitments represent approximately 3% of total commitments and are generally unsecured. Commercial and agricultural loan commitments represent approximately 52% of total commitments and are generally secured by various assets of the borrower. Real estate loan commitments, including consumer home equity lines of credit, represent the remaining 45% of total commitments and are generally secured by property with a loan-to-value rationot to exceed 80%. In addition, the majority of the Company’s commitments have variable interest rates.

Concentrations of Credit Risk

The Company grants real estate mortgage, real estate construction, commercial, agricultural and consumer loans to customers throughout Plumas, Nevada, Placer, Lassen, Sierra, Shasta, Sutter, Tehama and Modoc counties in California and Washoe and Carson City counties in Northern Nevada. Although the Company has a diversified loan portfolio, a substantial portion of its portfolio is secured by commercial and residential real estate. A continued substantial decline in the economy in general, or a continued decline in real estate values in the Company’s primary market areas in particular, could have an adverse impact on the collectability of these loans. However, personal and business income represents the primary source of repayment for a majority of these loans.

Contingencies

The Company is subject to legal proceedings and claims which arise in the ordinary course of business. In the opinion of management, the amount of ultimate liability with respect to such actions willnot materially affect the financial position or results of operations of the Company.

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Dividend Restrictions

The Company's ability to pay cash dividends is dependent on dividends paid to it by the Bank and limited by California corporation law. Under California law, the holders of common stock of the Company are entitled to receive dividends when and as declared by the Board of Directors, out of funds legally available, subject to certain restrictions. The California General Corporation Law permits a California corporation such as the Company to make a distribution to its shareholders if its retained earnings equal at least the amount of the proposed distribution or if after giving effect to the distribution, the value of the corporation’s assets exceed the amount of its liabilities plus the amount of shareholders preferences, if any, and certain other conditions are met.

Dividends from the Bank to the Company are restricted under California law to the lesser of the Bank's retained earnings or the Bank's net income for the latestthree fiscal years, less dividends previously declared during that period, or, with the approval of the DFPI to the greater of the retained earnings of the Bank, the net income of the Bank for its last fiscal year, or the net income of the Bank for its current fiscal year. As of* December 31, 2025*, the maximum amount available for dividend distribution under this restriction was $64,247,000. The Company paid a quarterly cash dividend of $0.30 per share on* November 17, 2025,** August 15, 2025,** May 15, 2025,and February 17, 2025,and a quarterly cash dividend of $0.27 per share on November 15, 2024,** August 15, 2024,** May 15, 2024,and February 15, 2024.*

Earnings Per Share

Basic earnings per share is computed by dividing income available to common shareholders by the weighted average number of common shares outstanding for the period. Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue common stock, such as stock options, result in the issuance of common stock which shares in the earnings of the Company. The treasury stock method has been applied to determine the dilutive effect of stock options in computing diluted earnings per share.

Shares of common stock issuable under stock options for which the exercise prices were greater than the average market prices werenot included in the computation of diluted earnings per share due to their antidilutive effect. Stock optionsnot included in the computation of diluted earnings per share, due to sharesnot being in the-money and having an antidilutive effect, were 0,5,860 and 101,994 for the years ended* December 31, 2025,*2024 and2023, respectively.

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Stock Options

In* May 2022,the Company’s shareholders approved the2022* Equity Incentive Plan (the*“2022* Plan”), which provides for the grant of up to 576,550 shares of common stock, including 126,550 shares that remained available for grant under the2013 Stock Option Plan when the2022 Plan was adopted. The2022 Plan provides for the grant of incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock, restricted stock units and other stock-based awards. The frequency, amount and terms of stock-based awards* maybe determined by the Board of Directors or its compensation committee, consistent with the terms and purposes of the2022* plan.

In* May 2013,the Company established the2013* Stock Option Plan for which 131,847 shares of common stock are reserved. With the establishment of the Company’s2022 Equity Incentive Plan,no further options* maybe issued under the2013* Stock Option Plan, though options previously granted continue to be outstanding and governed by the plan.

During the years ended* December 31, 2025,and December 31, 2024,30,803 and 107,200 options, respectively were granted under the2022* plan. There wereno options granted during the year ended* December 31, 2023,under the2022* plan. There wereno options granted during the years ended* December 31, 2025,*2024, and2023 under the2013 plan.

A summary of the activity within the2013 Plan follows:

A summary of the activity within the2022 Plan follows:

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Stock Options (Continued)

Information related to the stock options plans during thetwelve months ended* December 31, 2025,and2024.*

As of* December 31, 2025*, there was $774 thousand of total unrecognized compensation cost related to non-vested, share-based compensation under the2022 plan. That cost is expected to be recognized over a weighted average period of 3.0 years. As of* December 31, 2025*, there wasno unrecognized compensation cost related to non-vested, share-based compensation under the2013 plan.

Restricted Stock and Restricted Stock Units

During thetwelve months ended* December 31, 2024,the Company granted 3,033 restricted stock units with a fair value of $34.07 per share and aone-year vesting period. Compensation costs related to these units during thetwelve* months ended* December 31, 2025and2024,* were $14,000 and $89,000, respectively. As of* December 31, 2025,*there wasno unrecognized compensation cost related to restricted stock units.

During2024 the Company granted 435 shares of restricted stock with a fair value of $46.04 per share and which fully vested on* December 31, 2024,resulting in compensation costs during2024* of $20,000. During2022 the Company granted 1,650 shares of restricted stock with a fair value of $31 per share and aone-year vesting period.825 of these shares were terminated during2023 and 825 were fully vested on* December 31, 2023.Compensation costs related to these shares during thetwelve* months ended* December 2025,2024, and2023 totaled $0, $0, and $4,000, respectively. On * December 31, 2025,and2024, there wasno unrecognized compensation cost related to restricted stock.

Regulatory Capital

The Bank is subject to certain regulatory capital requirements administered by the FDIC. Failure to meet these minimum capital requirements can initiate certain mandatory and possibly additional discretionary, actions by regulators that, if undertaken, could have a direct material effect on the Company's consolidated financial statements. Under capital adequacy guidelines, the Bank must meet specific capital guidelines that involve quantitative measures of their assets, liabilities and certain off-balance sheet items as calculated under regulatory accounting practices. These quantitative measures are established by regulation and require that minimum amounts and ratios of total and Tier1 capital to risk-weighted assets and of Tier1 capital to average assets be maintained. Capital amounts and classifications are also subject to qualitative judgments by the regulators about components, risk weightings and other factors.

The Bank is also subject to additional capital guidelines under the regulatory framework for prompt corrective action. To be categorized as well capitalized, the Bank must maintain total risk-based, Tier1 risk-based and Tier1 leverage ratios as set forth in the below table, and cannot be subject to a written agreement, order or capital directive issued by the FRB.

In* July 2013,the federal bank regulatory agencies adopted rules implementing the Basel Committee on Banking Supervision’s capital guidelines for U.S. banks, sometimes called “Basel III,” that increased the minimum regulatory capital requirements for bank holding companies and banks and implemented strict eligibility criteria for regulatory capital instruments. The Basel III capital rules include a minimum common equity Tier1* ratio of 4.5%, a Tier1 capital ratio of 6.0%, a total risk-based capital ratio of 8.0%, and a minimum leverage ratio of 4.0% (calculated as Tier1 capital to average consolidated assets). The minimum capital levels required to be considered “well capitalized” include a common equity Tier1 ratio of 6.5%, a Tier1 risk-based capital ratio of 8.0%, a total risk-based capital ratio of 10.0% and a leverage ratio of 5.0%. In addition, the Basel III capital rules require that banking organizations maintain “a capital conservation buffer” of 2.5% above the minimum capital requirements in order to avoid restrictions on their ability to pay dividends, repurchase stock or pay discretionary bonuses. Including the capital conservation buffer of2.5%, the Basel III capital rules require the following minimum ratios for a bank holding company or bank to be considered well capitalized: a common equity Tier1 capital ratio of7.0%; a Tier1 capital ratio of8.5%, and a total capital ratio of10.5%. At* December 31, 2025*, the Company’s and the Bank’s capital ratios exceed the thresholds necessary to be considered “well capitalized” under the Basel III framework.

Under the FRB’s Small Bank Holding Company and Savings and Loan Holding Company Policy Statement (the “Policy Statement”), qualifying bank holding companies with less than $3 billion in consolidated assets are exempt from the consolidated capital rules. The Company qualifies for treatment under the Policy Statement and isnot currently subject to the Basel III consolidated capital rules at the bank holding company level. The new capital rules continue to apply to the Bank.

In2019, the federal banking agencies issued a rule establishing a “community bank leverage ratio” (the ratio of a bank’s tier1 capital to average total consolidated assets) that qualifying institutions with less than*$10* billion in assets* mayelect to use in lieu of the generally applicable leverage and risk-based capital requirements under Basel III. A qualifying banking organization that elects to use the new ratio will be considered to have met all applicable federal regulatory capital and leverage requirements, including the minimum capital levels required to be considered “well capitalized,” if it maintains a community bank leverage ratio capital exceeding9%.* The new rule became effective on* January 1, 2020.Plumas Bank has chosennot* to opt into the community bank leverage ratio at this time.

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The following table sets forth the Bank's actual capital amounts and ratios (dollar amounts in thousands):

(1) Doesnot include amounts required under the capital conservation buffer discussed above.

The current and projected capital positions of the Company and the Bank and the impact of capital plans and long-term strategies are reviewed regularly by management. The Company policy is to maintain the Bank’s ratios above the prescribed well-capitalized ratios at all times. Management believes that the Bank currently meets all its capital adequacy requirements.

Other expenses consisted of the following:

The provision for income taxes for the years ended* December 31, 2025,*2024 and2023 consisted of the following:

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Deferred tax assets (liabilities) consisted of the following:

Deferred tax assets and liabilities are recognized for the tax consequences of temporary differences between the reported amount of assets and liabilities and their tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The determination of the amount of deferred income tax assets which are more likely thannot to be realized is primarily dependent on projections of future earnings, which are subject to uncertainty and estimates that* maychange given economic conditions and other factors. The realization of deferred income tax assets is assessed and a valuation allowance is recorded if it is "more likely thannot"* that all or a portion of the deferred tax asset willnot be realized. "More likely thannot" is defined as greater than a50% chance. All available evidence, both positive and negative, is considered to determine whether, based on the weight of that evidence, a valuation allowance is needed.

At* December 31, 2025* total deferred tax assets were approximately $27,946,000 and total deferred tax liabilities were approximately $13,453,000 for a net deferred tax asset of $14,493,000. The Company’s deferred tax assets primarily relate to timing differences in the tax deductibility of unrealized losses on investment securities, depreciation on premises and equipment, the provision for credit losses and deferred compensation. Based upon our analysis of available evidence, management of the Company determined that it is "more likely thannot" that all of our deferred income tax assets as of* December 31, 2025and2024* will be fully realized and thereforeno valuation allowance was recorded. On the consolidated balance sheet, net deferred tax assets are included in accrued interest receivable and other assets.

Federal and State net operating loss carryforwards (NOLs) as of the Financial Statement Date totaled $2,762,000 and $1,987,000, respectively. The realization of these NOLs is dependent upon the Company’s ability to generate future taxable income during the carryforward periods. The Company has evaluated the available evidence, both positive and negative, and has concluded that it is more likely thannot that the NOLs will be fully realized, thereforeno valuation allowance was recorded.

The Company recognized, as components of tax expense, tax credits and other tax benefits and amortization expense relating to our investment in Qualified Affordable House Projects as follows:

The carrying value of Low-Income Housing Tax Credit Funds was $6,790,000 and $2,150,000 as of* December 31, 2025and2024*, respectively. As of* December 31, 2025*, the Company has committed to make additional capital contributions to the Low-Income Housing Tax Credit Funds in the amount of $4,249,000, and these contributions are expected to be made over the next several years.

During the year ended* December 31 2025,the Company purchased* $10 million of transferable green‑energy tax credits from unrelated third‑party project developers under the transferability provisions of the Inflation Reduction Act of2022. The purchased credits relate primarily to a solar **project placed in service during2025.

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The Company elected to apply the guidance in ASC740, Income Taxes, and therefore recognizes purchased tax credits as a reduction of income tax expense when (i) the Company obtains control of the credits, and (ii) realization is considered more likely thannot.

The credits were acquired at a 7% discount from face value.

As of* December 31, 2025,*the Company recognized:

No impairment or valuation allowance is considered necessary for the purchased credits.

The provision for income taxes differs from amounts computed by applying the statutory Federal income tax rate to operating income before income taxes. The significant items comprising these differences consisted of the following:

The cash paid across jurisdictions for income taxes (net of refunds) during the year was as follows:

The Company and its subsidiary file income tax returns in the U.S. federal and applicable state jurisdictions. The Company conducts all of its business activities in the states of California, Nevada and Oregon. There are currentlyno pending U.S. federal, state, and local income tax or non-U.S. income tax examinations by tax authorities.

With few exceptions, the Company isno longer subject to tax examinations by U.S. Federal taxing authorities for years ended before* December 31, 2022,and by state and local taxing authorities for years ended before December 31, 2021.*

The unrecognized tax benefits** and changes therein and the interest and penalties accrued by the Company as of or during the years ended December 31, 2025and2024 werenot significant. The Company doesnot expect the total amount of unrecognized tax benefits to significantly increase or decrease in the nexttwelve months.** **

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During the normal course of business, the Company enters into lending transactions with related parties, including executive officers and directors. The following is a summary of the aggregate activity involving related party borrowers during2024 and2025:

Deposits from executive officers, directors and their affiliates at year-end2025 and2024 were $7.3 million and $10.7 million.

Profit Sharing Plan

The Plumas Bank Profit Sharing Plan commenced* April 1, 1988and is available to employees meeting certain service requirements. Under the Plan, employees are able to defer a selected percentage of their annual compensation. Included under the Plan's investment options is the option to invest in Company stock. The Company’s contribution, which is recorded net of forfeitures, consisted of a matching amount of 30% of the employee’s contribution up to a total of 3% of the employee’s compensation totaling $468,000, $397,000 and $351,000 for the years ended December 31, 2025,*2024 and2023, respectively.

Salary Continuation and Retirement Agreements

Salary continuation and retirement agreements are in place for the Company’s president, its current executive vice presidents, six members of the Board of Directors as well asfive former executives andfour former directors. Under these agreements, the directors and executives will receive monthly payments for periods ranging fromten tofifteen years, after retirement. The estimated present value of these future benefits is accrued over the period from the effective dates of the agreements until the participants' expected retirement dates. The expense recognized under these plans for the years ended* December 31, 2025,2024 and2023 totaled $504,000, $483,000 and $595,000, respectively. Accrued compensation payable under these plans totaled $6,346,000 and $4,143,000 at December 31, 2025and2024*, respectively and is included in accrued interest payable and other liabilities on the consolidated balance sheet.

In connection with some of these agreements, the Bank purchased single premium life insurance policies with cash surrender values totaling $33,659,000 and $16,519,000 at* December 31, 2025and2024*, respectively. Income earned on these policies, net of expenses, totaled $741,000, $409,000 and $417,000 for the years ended* December 31, 2025,*2024 and2023, respectively.

The changes in the accumulated balances for each component of other comprehensive loss, net of tax for thetwelve months ended* December 31, 2025and2024* were as follows, in thousands:

The changes in the accumulated balances for each component of other comprehensive loss, net of tax for thetwelve months ended* December 31, 2025and2024* were as follows, in thousands:

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On* July 1, 2025,pursuant to a previously announced Agreement and Plan of Reorganization and Merger dated as of January 18, 2025 (*the “Merger Agreement”) between the Company and Cornerstone Community Bancorp (“Cornerstone”), Cornerstone merged with and into the Company with the Company continuing as the surviving corporation (the “Merger”). Immediately after the Merger, Cornerstone Community Bank ("CCB") the wholly owned bank subsidiary of Cornerstone, merged with and into Plumas Bank, with Plumas Bank continuing as the surviving bank. The Merger and Bank Merger are collectively referred to as the “Transaction.”

As part of its business strategy, the Company regularly reviews its business strategies and opportunities to enhance the value of its franchise, including through acquisitions. The Transaction is consistent with the Company’s business strategy, which will (1) expand Plumas’s geographic presence in existing and new markets in Northern California, (2) diversify and bring new expertise to Plumas’s lending business, and (3) strengthen the Company’s talent base.

Pursuant to the terms of the Merger Agreement, upon the completion of the Merger, each share of Cornerstone common stock outstanding immediately prior was converted into the right to receive 0.6608 shares of common stock of the Company and $9.75 cash, with cash paid in lieu of fractional shares. The total aggregate consideration delivered to holders of Cornerstone common stock in the Merger was 1,003,718 shares of Company common stock and $16.1 million cash.No contingent consideration was included as part of the purchase price for the acquisition of Cornerstone. The Company also assumed options to purchase 35,000 shares of Cornerstone common stock representing, on an as-converted basis, options to purchase 30,803 shares of the Company’s common stock. The value of the total deal consideration was approximately $61.3 million, which is based upon the average closing trading price of Plumas common stock for the 20 trading days ending on and including thesecond trading day prior to* July 1, 2025,*the closing date of the Merger.

Immediately after the Transaction, the newly combined company, operating as Plumas Bancorp with its banking subsidiary, Plumas Bank, had total assets of approximately $2.3 billion.

The transaction was accounted for using the acquisition method of accounting in accordance with ASC805, Business Combinations. The following table summarizes the preliminary allocation of the purchase price to the assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date in thousands:

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As a result of the Acquisition, we recorded $18.7 million in goodwill, which represents the excess of the total purchase price paid over the fair value of the assets acquired, net of the fair values of liabilities assumed. Goodwill mainly reflects expected value created through the combined operations of Plumas Bank and CCB and isnot tax deductible. The core deposit intangible will be amortized over 10 years. The fair value of loans includes both credit and interest-related discounts.

The results of operations of Cornerstone have been included in the Company’s consolidated financial statements since the acquisition date. It is impracticable to disclose Cornerstone’s separate revenue and net income since the acquisition because its operations were fully integrated into the Company’s existing business structure immediately upon acquisition, and separate financial information isnot maintained.

As part of the acquisition of Cornerstone on* July 1, 2025,*the Company acquired PCD loans. At acquisition, the Company recorded PCD loans at their purchase price and simultaneously established an allowance for credit losses based on expected credit losses over the life of the loans. A reconciliation of the purchase price of the PCD loans to the par value of these loans follows:

Reconciliation of Purchase Price to Par Value (in thousands):

The fair value of PCD loans acquired in the Cornerstone acquisition was determined using a DCF model. Key inputs and assumptions included:

The resulting fair value represents the present value of expected future cash flows, net of credit losses, and includes a gross-up for the allowance for credit losses under ASC326.

The following unaudited pro forma financial information presents the combined results of Plumas Bancorp and Cornerstone as if the acquisition had occurred on* January 1, 2024,in thousands. Acquisition expenses totaling $6.4 million, net of tax, are included in the year ended December 31, 2024,net income. These results arenot* necessarily indicative of future performance.

Pro Forma Adjustments Included for the Year Ended December 31, 2024:**

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CONDENSED BALANCE SHEETS

*** December 31, 2025and2024***

CONDENSED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

For the Years Ended December 31, 2025,2024 and2023

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CONDENSED STATEMENTS OF CASH FLOWS

For the Years Ended December 31, 2025,2024 and2023

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