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EMPLOYEE BENEFITS AND STOCK BASED COMPENSATION 10K | 12 Months Ended
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Dec. 31, 2024
Employee Benefits and Share-based Compensation, Noncash [Abstract] |
EMPLOYEE BENEFITS AND STOCK BASED COMPENSATION | 15. EMPLOYEE BENEFITS AND STOCK BASED COMPENSATION The Company has a 401(k) Plan designed to qualify under Section 401 of the Internal Revenue Code of 1986, as amended, that allows employees to defer a portion of their eligible compensation as savings for retirement. The 401(k) Plan provides for the Company to match employee contributions based on each employee’s elected contribution percentage. For each employee’s 1% through 3% dollar contributions, the Company will match 100% of such dollar contributions, and for each employee’s 4% through 5% dollar contributions, the Company will match 50% of such dollar contributions. All employees are eligible to participate in the 401(k) Plan after meeting minimum age and service requirements. The Company historically maintained a separate Employee Stock Ownership Plan (“ESOP”), but effective as of January 1, 2023 this plan was merged into the 401(k) Plan as a separate source for Company contributions. All employees of the Company meeting minimum age and service requirements are eligible to receive an allocation into the ESOP account within the 401(k) Plan. The Company makes discretionary profit-sharing contributions into the 401(k) Plan (including the ESOP account), and other cash bonus payments. Company discretionary contributions to the 401(k) Plan (including the ESOP account) are allocated to participant accounts in proportion to each participant’s compensation and vest according to the respective vesting schedule for each source of contributions into the 401(k) Plan. Employee contributions into the ESOP account within the 401(k) Plan are not allowed. ​ The following 401(k) Plan match and other discretionary contributions were made to the Company’s employees, in accordance with the descriptions above for the years ended December 31, (dollars in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | 2024 |  | 2023 |  | 2022
401(k) Plan Company Match | ​ | $ | 8,279 | ​ | $ | 7,091 | ​ | $ | 7,037
401(k) Plan ESOP Contribution | ​ |  | 800 | ​ |  | 804 | ​ |  | 750
Cash | ​ |  | 913 | ​ |  | 696 | ​ |  | 667
Total | ​ | $ | 9,992 | ​ | $ | 8,591 | ​ | $ | 8,454
​ The Company maintains certain deferred compensation arrangements with employees and certain current and former members of the Board of Directors. Under these deferred compensation plans, the Company had an obligation of $22.6 million at December 31, 2024 and $16.4 million at December 31, 2023. The Company owns life insurance policies on plan beneficiaries as an informal funding vehicle to meet future benefit obligations. At December 31, 2024 and 2023, the Company also had liabilities for post-retirement benefits payable to other partial beneficiaries under some of these life insurance policies of $12.5 million and $12.3 million, respectively. The Atlantic Union Bankshares Corporation Stock and Incentive Plan, as amended and restated, became effective on May 4, 2021 (the “Plan”), and authorizes the Company to issue up to 4,000,000 shares of its common stock. No awards may be granted under the Plan after May 3, 2031. As of December 31, 2024, there were 666,206 shares available for future issuance under the Plan. The Plan was originally adopted by the Board on November 2, 2010, and became effective on January 1, 2011, following shareholder approval, and was later amended and restated by the Board on January 29, 2015, which amendment and restatement became effective on April 21, 2015, following shareholder approval. ​ The Plan authorizes the granting of stock-based awards to key employees and non-employee directors of the Company and its subsidiaries in the form of: (i) stock options; (ii) restricted stock, (iii) restricted stock units, (iv) stock awards; (v) performance stock units; and (vi) performance cash awards. The Company issues new shares to satisfy stock-based awards. For option awards, the option price cannot be less than the fair market value of the stock on the grant date. Stock option awards have a maximum term of ten years from the date of grant, and generally become exercisable over a five- year period beginning on the first anniversary of the date of grant. The Company does not currently grant any stock options; however, the Company acquired stock options in prior acquisitions, most recently the acquisition of Access National Corporation, although no such stock options remained outstanding at December 31, 2024. Awards of restricted stock and performance stock units typically have vesting schedules over a three-year period and the expense is recognized over the vesting period. The Company recognized stock-based compensation expense, which is included in “Salaries and benefits” expense on the Company’s Consolidated Statements of Income as follows for the years ended December 31, (dollars in thousands, except per share data): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | 2024 |  | 2023 |  | 2022
Stock-based compensation expense | ​ | $ | 13,796 | ​ | $ | 11,101 | ​ | $ | 10,609
Reduction of income tax expense | ​ |  | 2,897 | ​ |  | 2,331 | ​ |  | 2,228
Per share compensation cost | ​ | $ | 0.12 | ​ | $ | 0.12 | ​ | $ | 0.11
​ ​ Stock Options The following table summarizes the stock option activity during the year ended December 31, 2024:
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | ​ |  | ​ | ​ |  | Weighted |  | ​ | ​
​ | ​ | ​ | ​ | Weighted | ​ | Average | ​ | ​ | ​
​ | ​ | Stock | ​ | Average | ​ | Remaining | ​ | Aggregate
​ | ​ | Options | ​ | Exercise | ​ | Contractual | ​ | Intrinsic
​ | ​ | (shares) | ​ | Price | ​ | Life | ​ | Value
Outstanding as of December 31, 2023 |  | 10,993 | ​ | $ | 31.83 |  | 0.06 |  | $ | 51,777
Granted |  | — | ​ |  | — |  |  |  | ​ |
Exercised |  | (7,163) | ​ |  | 31.83 |  |  |  | ​ |
Forfeited |  | — | ​ |  | — |  |  |  | ​ |
Expired |  | (3,830) | ​ |  | 31.83 |  |  |  | ​ |
Outstanding as of December 31, 2024 |  | — | ​ | $ | — |  | — | ​ | $ | —
Exercisable as of December 31, 2024 |  | — | ​ |  | — |  | — | ​ |  | —
​ During the year ended December 31, 2024, there were 7,163 stock options exercised with a total intrinsic value (the amount by which the stock price exceeded the exercise price) and fair value of approximately $25,000 and $253,000, respectively. Cash received from the exercise of stock options for the year ended December 31, 2024 was approximately $228,000, and the tax benefit realized from tax deductions associated with options exercised during the year was approximately $2,000. The total intrinsic value of all stock options outstanding was $0 as of December 31, 2024. During the year ended December 31, 2023, there were 23,796 stock options exercised with a total intrinsic value (the amount by which the stock price exceeded the exercise price) and fair value of approximately $87,000 and $864,500, respectively. Cash received from the exercise of stock options for the year ended December 31, 2023 was approximately $777,500, and the tax benefit realized from tax deductions associated with options exercised during the year was approximately $9,000. The total intrinsic value of all stock options outstanding was $52,000 as of December 31, 2023. During the year ended December 31, 2022, there were 111,774 stock options exercised with a total intrinsic value (the amount by which the stock price exceeded the exercise price) and fair value of approximately $701,000 and $4.6 million, respectively. Cash received from the exercise of stock options for the year ended December 31, 2022 was approximately $3.9 million, and the tax benefit realized from tax deductions associated with options exercised during the year was approximately $122,000. The total intrinsic value of all stock options outstanding was $106,000 as of December 31, 2022. Restricted Stock The Plan permits the granting of restricted stock. Generally, awards of restricted stock vest one-third on each of the first, second and third anniversaries from the date of grant. The value of the restricted stock is calculated by multiplying the fair market value of the Company’s common stock on the grant date by the number of restricted shares awarded. Employees have the right to vote the shares and to receive cash or stock dividends on nonvested shares of restricted stock, if any. Nonvested shares of restricted stock are included in the computation of basic earnings per share. The following table summarizes the restricted stock activity for the year ended December 31, 2024:
​ | ​ | ​ | ​ | ​ | ​
​ |  | ​ |  | Weighted
​ | ​ | Number of | ​ | Average
​ | ​ | Shares of | ​ | Grant-Date Fair
​ | ​ | Restricted Stock | ​ | Value
Unvested as of December 31, 2023 |  | 476,630 | ​ | $ | 37.03
Granted |  | 461,330 | ​ |  | 33.27
Net settle for taxes |  | (69,791) | ​ |  | 37.13
Vested |  | (188,616) | ​ |  | 36.66
Forfeited |  | (21,552) | ​ |  | 34.90
Unvested as of December 31, 2024 |  | 658,001 | ​ | $ | 34.56
​ ​ Performance Stock Units (“PSUs”) The Plan permits the granting of PSUs. PSUs are granted to certain employees at no cost to the recipient and are subject to vesting based on achieving certain performance metrics. Outstanding PSUs may be paid in cash or shares of common stock or a combination thereof at the discretion of the Company. Holders of PSUs have no right to vote the shares represented by the units until vested and settled. In 2024, there were two performance measures underlying the PSUs awarded, each weighted at 50%, as follows: (1) relative total shareholder return compared to the other companies comprising the KBW NASDAQ Regional Banking Index, which is a market-based condition; and (2) relative return on average tangible common equity, which is a performance-based condition. ​
​ | ​ | ​ | ​ | ​ | ​
​ |  | Number of |  | Weighted Average
​ | ​ | Shares of | ​ | Grant-
​ | ​ | PSUs | ​ | Date Fair Value
Unvested as of December 31, 2023 |  | 229,262 | ​ | $ | 37.29
Granted |  | 106,370 | ​ |  | 30.24
Net settle for taxes |  | (20,804) | ​ |  | 33.52
Vested |  | (44,694) | ​ |  | 33.52
Forfeited |  | (8,094) | ​ |  | 33.52
Unvested as of December 31, 2024 (1) |  | 262,040 | ​ | $ | 35.49
(1) The number of PSUs with a performance-based condition is presented based on achieving the performance measure at the target level of performance. ​ During the year ended December 31, 2024, the fair value of PSUs with a performance-based condition was equal to the closing sale price of the Company’s common stock on the grant date. During the years ended December 31, 2024, 2023 and 2022, the fair value of PSUs with a market-based condition was estimated using the Monte Carlo simulation lattice model that uses the assumptions noted in the following table as of December 31,: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | 2024 |  | 2023 |  | 2022 |
Dividend yield (1) |  | N/A | ​ | 3.19 | % | 3.95 | %
Expected life in years (2) |  | 2.86 |  | 2.85 |  | 2.25 | ​
Expected volatility (3) |  | 33.92 | % | 40.39 | % | 36.32 | %
Risk-free interest rate (4) |  | 4.47 | % | 4.39 | % | 4.18 | %
Present value of expected dividends foregone (5) |  | 3.82 | ​ | N/A | ​ | N/A | ​
(1) Calculated as the ratio of the current dividend paid per the stock price on the date of grant. (2) Represents the remaining performance period as of the grant date. (3) Based on the historical volatility for the period commensurate with the expected life of the PSUs. (4) Based upon the zero-coupon U.S. Treasury rate commensurate with the expected life of the PSUs on the grant date. (5) Calculated using projected dividend payments and timing over the remaining performance period. N/A – assumption not used for respective period. The estimated unamortized compensation expense, net of estimated forfeitures, related to, restricted stock, performance stock and stock options issued and outstanding as of December 31, 2024 that will be recognized in future periods is as follows (dollars in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Restricted |  | Performance | ​ | ​ | Stock |  | ​ | ​
​ | ​ | Stock | ​ | Stock | ​ | ​ | Options | ​ | Total
2025 | ​ | $ | 8,429 | ​ | $ | 2,236 | ​ | $ | — | ​ | $ | 10,665
2026 | ​ |  | 5,054 | ​ |  | 1,125 | ​ | ​ | — | ​ |  | 6,179
2027 | ​ |  | 817 | ​ |  | — | ​ | ​ | — | ​ |  | 817
2028 | ​ |  | 6 | ​ |  | — | ​ | ​ | — | ​ |  | 6
Total | ​ | $ | 14,306 | ​ | $ | 3,361 | ​ | $ | — | ​ | $ | 17,667
​

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