Common Stock, Compensation Plans and Other

3 Months Ended

Mar. 31, 2025

Common Stock, Compensation Plans and Other

12. Common Stock, Compensation Plans and Other

Common Stock

As of March 31, 2025, the Company’s Restated Articles of Incorporation, as amended, authorized the issuance of up to 300,000,000 shares of common stock, par value $0.01 per share. However, on April 17, 2025 at the Annual Meeting of Shareholders of the Company, the shareholders approved an amendment to the Company's Restated Articles of Incorporation to increase the number of authorized shares of common stock from 300,000,000 to 400,000,000.

The Company also has the authority to issue up to 5,500,000 shares of preferred stock, par value $0.01 per share under the Company’s Restated Articles of Incorporation, as amended.

Stock Repurchases

On January 17, 2025, the Board of Directors (the “Board”) of the Company authorized an increase in the shares of the Company’s common stock available for repurchase under its stock repurchase program, which was originally approved by the Board in January 2008 and most recently amended in January 2021, to renew the authorization to 20,000,000 shares. As of January 17, 2025, a total of approximately 13,244,493 shares remained available for repurchase under the existing repurchase authorization, resulting in an increase of 6,755,507 shares of common stock available for repurchase.

During the three months ended March 31, 2025, the Company repurchased a total of 1,000,000 shares with a weighted-average stock price of $29.67 per share. Shares repurchased under the program as of March 31, 2025 since its inception total 27,507,507 shares. The remaining balance available for repurchase is 19,000,000 shares at March 31, 2025.

Stock Compensation Plans

The Company has a stock option and performance incentive plan known as the Home BancShares, Inc. 2022 Equity Incentive Plan (the “Plan”). The purpose of the Plan is to attract and retain highly qualified officers, directors, key employees, and other persons, and to motivate those persons to improve the Company’s business results. As of March 31, 2025, the maximum total number of shares of the Company’s common stock available for issuance under the Plan was 14,788,000 shares. At March 31, 2025, the Company had 1,807,181 shares of common stock available for future grants and 3,207,204 shares of common stock reserved for issuance pursuant to the Plan.

The intrinsic value of the stock options outstanding was $7.6 million, which includes the intrinsic value of vested stock options of $6.2 million at March 31, 2025. The intrinsic value of stock options exercised during the three months ended March 31, 2025 was approximately $1.6 million. Total unrecognized compensation cost related to non-vested stock option awards, which are expected to be recognized over the vesting periods, was approximately $1.1 million as of March 31, 2025.

The table below summarizes the stock option transactions under the Plan at March 31, 2025 and December 31, 2024 and changes during the three-month period and year then ended:


	For the Three Months Ended March 31, 2025			For the Year Ended December 31, 2024
	Shares (000)	Weighted- Average Exercisable Price		Shares (000)	Weighted- Average Exercisable Price
Outstanding, beginning of year	1,590	$	22.66	2,776	$	20.95
Granted	—	—		10	29.41
Forfeited/Expired	(7)	21.78		(35)	21.87
Exercised	(183)	21.36		(1,161)	18.65
Outstanding, end of period	1,400	22.84		1,590	22.66
Exercisable, end of period	1,110	22.72		1,044	22.34

Stock-based compensation expense for stock-based compensation awards granted is based on the grant-date fair value. For stock option awards, the fair value 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 would otherwise have a significant effect on the value of employee stock options granted but are not considered by the model. Accordingly, while management believes that the Black-Scholes option-pricing model provides a reasonable estimate of fair value, the model does not necessarily provide the best single measure of fair value for the Company's employee stock options. There were no options granted during the three months ended March 31, 2025. The fair value of each option granted is estimated on the date of grant using the Black-Scholes option-pricing model based on the weighted-average assumptions for expected dividend yield, expected stock price volatility, risk-free interest rate, and expected life of options granted.

The assumptions used in determining the fair value of the 2025 and 2024 stock option grants were as follows:


	For the Three Months Ended March 31, 2025	For the Year Ended December 31, 2024
Expected dividend yield	Not applicable	2.65	%
Expected stock price volatility	Not applicable	28.47	%
Risk-free interest rate	Not applicable	4.25	%
Expected life of options	Not applicable	6.5 years

The following is a summary of currently outstanding and exercisable options at March 31, 2025:


Options Outstanding					Options Exercisable
Exercise Prices	Options Outstanding Shares (000)	Weighted- Average Remaining Contractual Life (in years)	Weighted- Average Exercise Price		Options Exercisable Shares (000)	Weighted- Average Exercise Price
$16.00 to $17.99	4	0.04	$	17.12	4	$	17.12
$18.00 to $19.99	72	1.51	$	18.64	72	$	18.64
$20.00 to $21.99	151	3.59	20.85		127	20.91
$22.00 to $23.99	1,106	3.42	23.21		862	23.20
$24.00 to $25.99	57	3.56	25.43		45	25.74

$28.00 to $29.99	10	9.61	29.41		—	—
	1,400				1,110

The table below summarized the activity for the Company’s restricted stock issued and outstanding at March 31, 2025 and December 31, 2024 and changes during the period and year then ended:


	As of March 31, 2025		As of December 31, 2024
	(In thousands)
Beginning of year	1,429		1,429
Issued	263		531
Vested	(425)		(469)
Forfeited	(11)		(62)
End of period	1,256		1,429
Amount of expense for the three months and twelve months ended, respectively	$	2,565	$	8,228

Total unrecognized compensation cost related to non-vested restricted stock awards, which are expected to be recognized over the vesting periods, was approximately $19.8 million as of March 31, 2025.