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STOCK-BASED COMPENSATION | 12 Months Ended
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Dec. 31, 2023
Share-Based Payment Arrangement [Abstract] |
STOCK-BASED COMPENSATION | NOTE 14. STOCK-BASED COMPENSATION Stock Options Busey has outstanding stock options that were issued under the First Community 2016 Equity Incentive Plan and assumed from acquisitions. A summary of the status of, and changes in, Busey's stock option awards follows (dollars in thousands, except weighted-average exercise price):
Options |  | Shares |  | Weighted- Average Exercise Price |  | Weighted- Average Remaining Contractual Life |  | Intrinsic Value
Outstanding at December 31, 2022 |  | 26,106 |  |  | $ | 23.53 |  |  | 3.88 |  | $ | 31 |
Forfeited |  | (4,840) |  |  | 23.53 |  |  |  |  |
Outstanding at December 31, 2023 |  | 21,266 |  |  | 23.53 |  |  | 2.88 |  | 27 |
Exercisable at December 31, 2023 |  | 21,266 |  |  | 23.53 |  |  | 2.88 |  | 27 |
2020 Equity Plan The 2020 Equity Plan was originally approved by stockholders at the 2020 Annual Meeting of Stockholders. A description of the 2020 Equity Plan, as originally approved, can be found in Appendix A within Busey’s Proxy Statement for the 2020 Annual Meeting of Stockholders filed on April 9, 2020. An amendment and restatement of the 2020 Equity Plan was approved by stockholders at the 2023 Annual Meeting of Stockholders. Terms of the amended and restated 2020 Equity Plan are substantially identical to those of the originally approved 2020 Equity Plan, other than a 1,350,000 increase in the number of shares authorized for issuance under the plan. More information can be found in Appendix A within Busey’s Proxy Statement for the 2023 Annual Meeting of Stockholders filed on April 14, 2023. Under the terms of the 2020 Equity Plan, Busey has granted RSU, PSU, and DSU awards. Upon vesting and delivery, shares are expected, though not required, to be issued from treasury. A description of RSU, PSU, and DSU awards granted in 2023 under the terms of the 2020 Equity Plan is provided below. A description of RSU, PSU, and DSU awards granted in 2022 and 2021 under the terms of the 2020 Equity Plan can be found in Busey’s Annual Reports for the years ended December 31, 2022, and 2021, respectively. Busey issued 132,091 treasury shares in conjunction with the vesting of RSUs and PSUs, and settlement of DSUs in 2023. The difference between the number of shares issued and the number of vested units is due to shares issued under a net share settlement option. There were 1,723,343 shares available for issuance under the 2020 Equity Plan as of December 31, 2023. RSU Awards Busey grants RSU awards to members of management periodically throughout the year. RSU awards are stock-based awards for which vesting is conditional upon meeting established service criteria. Each RSU is equivalent to one share of Busey’s common stock. Busey’s RSUs have requisite service periods ranging from one year to five years, and are subject to accelerated vesting upon eligible retirement from Busey. Recipients earn quarterly dividend equivalents on their respective RSUs, which entitle the recipients to additional units. Therefore, dividends earned each quarter compound based upon the updated unit balances. On March 22, 2023, under the terms of the 2020 Equity Plan, Busey granted 224,316 RSUs to members of management. The grant date fair value of the award was $4.6 million, which will be recognized as compensation expense over the requisite service period ranging from one year to five years. The terms of these awards included an accelerated vesting provision upon eligible retirement from Busey, after a one-year minimum requisite service period. Subsequent to the requisite service period, the awards will become 100% vested. A summary of changes in Busey’s RSU awards for the year ended December 31, 2023, is as follows:
RSU Awards |  | Shares |  | Weighted- Average Grant Date Fair Value
Nonvested at December 31, 2022 |  | 1,096,931 |  |  | $ | 23.61 |
Granted |  | 224,316 |  |  | 20.44 |
Dividend equivalents earned |  | 58,930 |  |  | 20.16 |
Vested |  | (154,995) |  |  | 29.71 |
Forfeited |  | (183,738) |  |  | 22.33 |
Nonvested at December 31, 2023 |  | 1,041,444 |  |  | $ | 22.05 |
PSU Awards Busey grants PSU awards to members of management periodically throughout the year. PSU awards are stock-based awards for which vesting is conditional upon meeting established performance criteria. Each PSU is equivalent to one share of Busey’s common stock. The number of PSUs that ultimately vest will be determined based on the extent to which market or other performance goals are achieved. Busey’s PSUs are subject to accelerated service-based vesting conditions upon eligible retirement from Busey. After performance determination, dividend equivalents are compounded based upon the updated PSU balances at each dividend date during the performance period. On March 22, 2023, under the terms of the 2020 Equity Plan, Busey granted a target of 104,643 PSUs with a maximum award of 167,429 units. The actual number of units issued at the vesting date could range from 0% to 160% of the initial grant, depending on attaining a market-based total stockholder return performance goal. The grant date fair value of the award was $2.0 million, which will be recognized in compensation expense over the performance period ending December 31, 2025. On March 22, 2023, under the terms of the 2020 Equity Plan, Busey granted a target of 104,643 PSUs with a maximum award of 167,429 units. The actual number of units issued at the vesting date could range from 0% to 160% of the initial grant, depending on attaining an adjusted return on average tangible common equity performance goal. The grant date fair value of the award was $2.1 million, which will be recognized in compensation expense over the performance period ending December 31, 2025. The actual amount of compensation expense recognized is subject to adjustment based on the extent to which performance goals are expected to be achieved. On March 22, 2023, under the terms of the 2020 Equity Plan, Busey granted a target of 15,045 PSUs with a maximum award of 30,090 units. The actual number of units issued at the vesting date could range from 0% to 200% of the initial grant, depending on attaining a performance goal based upon the compounded annual revenue growth rate of the FirsTech operating segment. The grant date fair value of the award was $0.3 million, which will be recognized in compensation expense over the performance period ending December 31, 2025. The actual amount of compensation expense recognized is subject to adjustment based on the extent to which performance goals are expected to be achieved. A summary of changes in Busey’s PSU awards for the year ended December 31, 2023, is as follows:
PSU Awards |  | Shares 1 |  | Weighted- Average Grant Date Fair Value
Nonvested at December 31, 2022 |  | 285,351 |  |  | $ | 25.40 |
Granted |  | 224,331 |  |  | 20.04 |
Dividend equivalents earned |  | 1,728 |  |  | 23.28 |
Vested |  | (83,399) |  |  | 23.86 |
Forfeited |  | (88,923) |  |  | 23.80 |
Adjustment for performance conditions 2 |  | 2,612 |  |  | 25.52 |
Nonvested at December 31, 2023 |  | 341,700 |  |  | $ | 22.67 |
Vested and outstanding at December 31, 2023³ |  | 65,996 |  |  | $ | 23.48 |
___________________________________________ 1.Shares for PSU awards represent target shares at grant date. 2.Adjustments for performance conditions represent the difference between the number of target shares at grant date and the number of actual shares earned for the performance period completed. 3.PSUs granted in 2021 vested on December 31, 2023. Shares are reported at target amounts. Performance determination and settlement activity will take place in the first quarter of 2024. DSU Awards Busey grants DSU awards to its directors and advisory directors. DSU awards are stock-based awards with a deferred settlement date. Each DSU is equivalent to one share of Busey’s common stock. DSUs vest over a one-year period following the grant date. Under the 2020 Equity Plan, DSUs are generally subject to the same terms as RSUs, except that following vesting of DSUs, settlement occurs within 30 days following the earlier of separation from the board or a change in control of the Company. After vesting and prior to delivery, DSUs will continue to earn dividend equivalents. On March 22, 2023, under the terms of the 2020 Equity Plan, Busey granted 41,548 DSUs to directors and advisory directors. The grant date fair value of the award totaled $0.8 million and will be recognized as compensation expense over the requisite service period of one year. Subsequent to the requisite service period, the awards will become 100% vested. A summary of changes in Busey’s DSU awards for the year ended December 31, 2023, is as follows:
DSU Awards |  | Shares |  | Weighted- Average Grant Date Fair Value
Nonvested at December 31, 2022 |  | 31,085 |  |  | $ | 25.75 |
Granted |  | 41,548 |  |  | 20.44 |
Dividend equivalents earned |  | 8,334 |  |  | 20.09 |
Vested |  | (37,868) |  |  | 24.76 |
Forfeited |  | (73) |  |  | 20.44 |
Nonvested at December 31, 2023 |  | 43,026 |  |  | $ | 20.41 |
Vested and outstanding at December 31, 2023 |  | 144,137 |  |  | $ | 23.52 |
2021 Employee Stock Purchase Plan The 2021 ESPP was approved at Busey’s 2021 Annual Meeting of Stockholders. The purpose of the 2021 ESPP is to provide a means through which our employees may acquire a proprietary interest in Busey by purchasing shares of our common stock at a 15% discount through voluntary payroll deductions, to assist us in retaining the services of our employees and securing and retaining the services of new employees, and to provide incentives for our employees to exert maximum efforts toward our success. Under the terms of the 2021 ESPP, all participating employees have equal rights and privileges. Substantially all of our employees are eligible to participate in the 2021 ESPP. Further details can be found in Appendix A within Busey’s Definitive Proxy Statement filed with the SEC on April 8, 2021. The 2021 ESPP initially reserved for issuance and purchase an aggregate of 600,000 shares of Busey’s common stock. The first offering under the 2021 ESPP began on July 1, 2021. There were 452,379 shares available for issuance under the 2021 ESPP as of December 31, 2023. Stock-Based Compensation Expense Busey did not record any stock option compensation expense for the years ended December 31, 2023, 2022, or 2021. Busey did not have any unrecognized stock option compensation expense as of December 31, 2023. Busey recognized compensation expense related to non-vested RSU, PSU, and DSU awards, as well as the 2021 ESPP, as summarized in the table below (dollars in thousands):
|  |  | Years Ended December 31,
|  |  |  |  | 2023 |  | 2022 |  | 2021
Stock-based compensation expense |  |  |  |  |  |  |  |  |
RSU awards |  |  |  |  | $ | 2,622 |  |  | $ | 4,648 |  |  | $ | 5,809 |
PSU awards 1 |  |  |  |  | 2,962 |  |  | 3,240 |  |  | 979 |
DSU awards |  |  |  |  | 833 |  |  | 876 |  |  | 962 |
2021 ESPP |  |  |  |  | 178 |  |  | 204 |  |  | 114 |
Total stock-based compensation expense |  |  |  |  | $ | 6,595 |  |  | $ | 8,968 |  |  | $ | 7,864 |
___________________________________________ 1.Expense for PSU awards with a market-based total stockholder return performance goal represents amounts based on target shares at the grant date. Expense for PSU awards with return on average tangible common equity and compounded annual revenue growth rate performance goals represents amounts based on target shares at the grant date, adjusted for performance expectations as of the date indicated. Unamortized stock-based compensation expense is presented in the table below (dollars in thousands):
| As of December 31,
| 2023 |  | 2022
Unamortized stock-based compensation |  |  |
RSU awards | $ | 6,842 |  |  | $ | 8,570 |
PSU awards 1 | 3,607 |  |  | 4,279 |
DSU awards | 190 |  |  | 175 |
Total unamortized stock-based compensation | $ | 10,639 |  |  | $ | 13,024 |
Weighted average period over which expense is to be recognized | 2.4 years |  | 2.5 years
___________________________________________ 1.Unamortized expense for PSU awards with a market-based total stockholder return performance goal represents amounts based on target shares at grant date. Unamortized expense for PSU awards with return on average tangible common equity and compounded annual revenue growth rate performance goals represents amounts based on target shares at grant date, adjusted for performance expectations as of the date indicated.

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