Company: NWFL
Filing Date: 2025-10-28
Form Type: 424B3
Source: 0001193125-25-252482
Chunk: 221

Company: NORWOOD FINANCIAL CORP
Filing Date: 2025-10-28
Form: 424B3
Chunk 221
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| Forfeited                      |     |                              |  (1,000 | ) |     |           | 13.80 |     |                  | 9.42 |     |           |     |
| Outstanding, December 31, 2024 |     |                              | 277,725 |   |     | $         | 12.28 |     |                  | 7.93 |     | $         | 834 |
| Exercisable, December 31, 2024 |     |                              | 106,428 |   |     | $         | 12.28 |     |                  | 7.87 |     | $         | 319 |

During the second quarter of 2024, we granted 11,653 shares of stock options at an exercise price of $12.20 that become exercisable ratably over five years (20.0% per year). The fair value of stock options granted is estimated at the date of grant using the Black-Scholes option-pricing model. This model requires the input of highly subjective assumptions, changes to which can materially affect the fair value estimate. Additionally, there may be other factors that might otherwise have a significant effect on the value of stock options granted that are not considered by the model. The assumptions used to value options granted in 2024 are as follows: 31.76% volatility, 7.5 years of expected life, 0.0% dividend yield and a risk-free rate of 4.66%. Restricted stock expense was $271,000 and $265,000 for the years ended December 31, 2024 and 2023, respectively. At December 31, 2024, the expected future compensation expense relating to non-vested stock outstanding was $833,000. F-31

PB BANKSHARES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS A summary of the Company’s restricted stock activity and related information for the years ended December 31, 2024 and 2023, is as follows:

|                                 |     | Number of 
 Shares    |         |   |     | Weighted-Average 
 Grant Date Fair  
 Value            |       |
|:--------------------------------|:----|:----------|--------:|:--|:----|:-----------------|------:|
| Non-vested, January 1, 2023     |     |           | 108,115 |   |     | $