XML 36 R22.htm IDEA: XBRL DOCUMENT
v3.24.0.1

Stock and Incentive Compensation Plans | 12 Months Ended
--- | ---
Dec. 31, 2023
Share-Based Payment Arrangement [Abstract] |
Stock and Incentive Compensation Plans | Note 13 — Stock and Incentive Compensation Plans The Company has granted, and currently has outstanding, stock and incentive compensation awards subject to the provisions of the Company’s 2012 Stock Incentive Plan (the “2012 Plan”). The 2012 Plan is designed to provide flexibility to the Company regarding its ability to motivate, attract and retain the services of key officers, employees and directors. The 2012 Plan allows the Company to make grants of incentive stock options, non-qualified stock options, stock appreciation rights, restricted stock awards (“RSA”), restricted stock units (“RSU”), dividend equivalent rights, performance stock units (“PSU”) or any combination thereof. At December 31, 2023, the maximum number of shares of the Company’s common stock available for issuance under the 2012 Plan was 33,365 shares. Additionally, the Company’s stockholders approved an employee stock purchase plan (“ESPP”) which qualified as an ESPP under IRS guidelines. The ESPP provides for the purchase of up to an aggregate one million shares of the Company’s common stock by employees. Under the ESPP, employees of the Company, who elect to participate, have the right to purchase a limited number of shares of the Company’s common stock at a 15% discount from the lower of the market value of the common stock at the beginning or the end of each one year offering period, beginning on June 1st. The ESPP benefit is treated as compensation to the employee, and the compensation expense will be recognized over the service period based on the grant date fair value of the rights determined at the beginning of the purchase period, adjusted for forfeitures and certain modifications. At December 31, 2023, there was $188,000 of total unrecognized compensation cost related to estimated ESPP shares for the June 1, 2023, ESPP purchase period. These costs are expected to be recognized over a period of 0.42 year. The table below includes the weighted-average assumptions used to calculate the grant date fair value of the ESPP rights for the periods indicated using the Black-Scholes option pricing model:
|  |  | Years Ended December 31,
|  |  |  |  | 2023 |  | 2022 |  | 2021
Expected term (in years) |  |  |  |  | 1.00 |  | 1.00 |  | 1.00
Dividend yield |  |  |  |  | $ | 1.88 |  |  | $ | 1.41 |  |  | $ | 1.25 |
Risk-free interest rate |  |  |  |  | 3.90 | % |  | 1.24 | % |  | 0.10 | %
Expected volatility |  |  |  |  | 31.63 |  |  | 37.90 |  |  | 45.96 |
The ESPP shares purchased are as follows for the dates indicated:
|  |  | Years Ended December 31,
|  |  |  |  | 2023 |  | 2022 |  | 2021
ESPP shares purchased |  |  |  |  | 46,213 |  |  | 26,089 |  |  | — |
Shares available for issuance under the ESPP |  |  |  |  | 927,698 |  |  | 973,911 |  |  | 1,000,000 |
The Compensation Committee (“Committee”) has approved and the Company has granted PSUs to select officers and employees under the 2012 Plan. Each PSU represents a right for the participant to receive shares of Company common stock or cash equal to the fair market value of such stock, as determined by the Committee. The number of PSUs to which the participant may be entitled will vary from 0% to 150% of the target number of PSUs, based on the Company’s achievement of specified performance criteria during the performance period compared to performance benchmarks adopted by the Committee and, further, the participant’s continuous service with the Company through the third anniversary of the date of the grant. Each performance period commences on January 1 and ends three years later on December 31, (“Performance Period”). On December 7, 2022, the Committee and the independent members of the Board also approved a special, one-time stock award to Drake Mills, the Company’s President and Chief Executive Officer (the “One-Time Award”), having an approximate value of $10,000,000, was comprised of 129,736 restricted stock units (“CEO RSUs”) and 129,735 market-based performance stock units (“CEO PSUs”), and was effective as of December 13, 2022, (the “Grant Date”). In exchange for the One-Time Award, Mr. Mills agreed to a 2-year non-competition covenant, in addition to the standard non-solicitation of customers and employees covenant included in the Company’s form of award agreement. Pursuant to the One-Time Award, the CEO RSUs shall vest in five approximately equal installments on each of the third, fourth, fifth, sixth and seventh anniversaries of the Grant Date, subject to Mr. Mills’ continued employment with the Company on each respective vesting date, or upon the earlier occurrence of Mr. Mills’ death, disability, termination of employment without cause or resignation for good reason. The CEO PSUs shall be eligible to vest based on achievement of five pre-established stock price hurdles (each, a “Stock Price Hurdle”) during a seven-year performance period (the “CEO Performance Period”). Achievement of each Stock Price Hurdle requires substantial and sustained growth in the Company’s stock price, with each Stock Price Hurdle representing a twenty percent (20%) price appreciation over the 20-day average closing price of the Company’s common stock as of the Grant Date (such that 100% appreciation is required for 100% of the CEO PSUs to vest). Each Stock Price Hurdle must be maintained for twenty consecutive days during the CEO Performance Period. Each of the five tranches of CEO PSUs will vest on the later of the date that the applicable Stock Price Hurdle is achieved (“Achieved PSUs”) or the third, fourth, fifth, sixth and seventh anniversaries of the Grant Date, respectively, subject to Mr. Mills’ continued employment with the Company on each respective vesting date, or upon the earlier occurrence of Mr. Mills’ death or disability. If Mr. Mills’ employment is terminated without cause or he resigns for good reason, then any Achieved PSUs will become fully vested and unearned CEO PSUs will remain outstanding and eligible to vest based on achievement of the Stock Price Hurdle during the CEO Performance Period. The One-Time Award was granted pursuant to, and subject to the terms and conditions of, the Origin Bancorp, Inc. 2012 Stock Incentive Plan and the Company’s form of RSU agreement and PSU agreement, respectively. Compensation expense for the CEO PSUs will be recognized over the vesting period of the awards based on the fair value of the award at the grant date determined by using a Monte Carlo simulation model with the following inputs:
Simulation Inputs | Year Ended December 31, 2022
Grant date | December 13, 2022
Performance period | seven years
Stock price | $ | 36.87 |
Expected volatility (1) | 33.0 | %
Risk-free rate (2) | 3.5 |
____________________________ (1)The expected volatility was determined based on the historical volatilities of the Company and the specified peer group. (2)The risk-free interest rate for the performance period was derived from the seven-year continuous U.S. Treasury Yield constant maturity curve on the valuation date. Share-based compensation cost charged to income for the years ended December 31, 2023, 2022 and 2021, is presented below. There was no stock option expense for any of the periods shown.
|  |  |  |  | Years Ended December 31,
(Dollars in thousands) |  |  |  |  |  |  |  |  | 2023 |  | 2022 |  | 2021
RSA & RSU |  |  |  |  |  |  |  |  | $ | 4,321 |  |  | $ | 2,845 |  |  | $ | 2,100 |
PSU |  |  |  |  |  |  |  |  | 534 |  |  | 288 |  |  | — |
ESPP |  |  |  |  |  |  |  |  | 426 |  |  | 316 |  |  | 195 |
Total stock compensation expense |  |  |  |  |  |  |  |  | $ | 5,281 |  |  | $ | 3,449 |  |  | $ | 2,295 |
Related tax benefits recognized in net income |  |  |  |  |  |  |  |  | $ | 1,109 |  |  | $ | 724 |  |  | $ | 482 |
Restricted Stock and Performance Stock Grants The Company’s RSAs and RSUs are time-vested awards and are granted to the Company’s Board of Directors, executives and senior management team. The service period in which time-vested awards are earned ranges from one to seven years. Time-vested awards are valued utilizing the fair value of the Company’s stock at the grant date. These awards are recognized on the straight-line method over the requisite service period, with forfeitures recognized as they occur. The Company’s PSU awards, excluding the CEO PSUs, are three-year cliff-vested awards, with each unit divided into two categories (“ROAA Unit Group” and “ROAE Unit Group”), composed of an equivalent number of initial PSUs granted. The PSU share amounts do not reflect potential increases or decreases resulting from the interim performance results until the final performance results are determined at the end of the three-year period. The ROAA Unit Group is based upon the Company’s Performance Period Return on Average Assets performance, and the ROAE Unit Group is based upon the Company’s Performance Period Return on Average Equity performance. The PSUs are initially valued utilizing the fair value of the Company’s stock at the grant date, assuming 100% of the target number of units are achieved. Subsequent valuation of the PSUs is determined using the ratio of the actual Company’s Performance Period ROAA or ROAE to the Company’s targeted Performance Period ROAA or ROAE, applied to the PSUs awarded times the Company’s closing month end stock price for the month immediately preceding the period end date. The determination of whether and to what extent the performance criteria has been satisfied during the applicable Performance Period shall be made by the Compensation Committee, in its sole and absolute discretion. Certain nonrecurring, unusual or infrequent items may be disregarded in the ROAA or ROAE calculation as described further in the PSU award agreement. Forfeitures are recognized as they occur. The following table summarizes the Company’s award activity:
| Years Ended December 31,
| 2023 |  | 2022 |  | 2021
| Shares |  | Weighted Average Grant-Date Fair Value |  | Shares |  | Weighted Average Grant-Date Fair Value |  | Shares |  | Weighted Average Grant-Date Fair Value
Nonvested RSAs, January 1, | 27,391 |  |  | $ | 35.37 |  |  | 48,048 |  |  | $ | 35.27 |  |  | 103,359 |  |  | $ | 31.51 |
Granted RSAs | 16,788 |  |  | 28.61 |  |  | 12,840 |  |  | 37.39 |  |  | 13,460 |  |  | 42.26 |
Vested RSAs | (26,550) |  |  | 35.11 |  |  | (33,497) |  |  | 36.00 |  |  | (67,825) |  |  | 31.07 |
Forfeited RSAs | — |  |  | — |  |  | — |  |  | — |  |  | (946) |  |  | 24.69 |
Nonvested RSAs, December 31, | 17,629 |  |  | 29.33 |  |  | 27,391 |  |  | 35.37 |  |  | 48,048 |  |  | 35.27 |
Nonvested RSUs, January 1, | 270,390 |  |  | $ | 39.63 |  |  | 73,977 |  |  | $ | 40.64 |  |  | — |  |  | $ | — |
Granted RSUs | 116,098 |  |  | 35.65 |  |  | 222,282 |  |  | 39.43 |  |  | 73,977 |  |  | 40.64 |
Vested RSUs | (55,614) |  |  | 41.98 |  |  | (24,028) |  |  | 40.56 |  |  | — |  |  | — |
Forfeited RSUs | (12,706) |  |  | 41.59 |  |  | (1,841) |  |  | 43.48 |  |  | — |  |  | — |
Nonvested RSUs, December 31, | 318,168 |  |  | 37.69 |  |  | 270,390 |  |  | 39.63 |  |  | 73,977 |  |  | 40.64 |
Nonvested PSUs, January 1, | 157,367 |  |  | $ | 29.06 |  |  | — |  |  | $ | — |  |  | — |  |  | $ | — |
Granted PSUs | 43,591 |  |  | 31.77 |  |  | 157,367 |  |  | 29.06 |  |  | — |  |  | — |
Forfeited PSUs | (3,116) |  |  | 31.77 |  |  | — |  |  | — |  |  | — |  |  | — |
Nonvested PSUs, December 31, | 197,842 |  |  | 28.33 |  |  | 157,367 |  |  | 29.06 |  |  | — |  |  | — |
At December 31, 2023, there was $153,000, $9.7 million and $2.6 million of total unrecognized compensation cost related to nonvested RSA shares, RSU shares and PSU shares under the 2012 Plan, respectively. Those costs are expected to be recognized over a weighted-average period of 0.3, 3.6 and 1.9 years for RSA, RSU and PSU shares, respectively. Stock Option Grants The Company has previously issued common stock options to select officers and employees primarily through individual agreements. The exercise price of each option varies by agreement and is based on the fair value of the stock at the date of the grant. No outstanding stock option has a term that exceeds twenty years, and all of the outstanding options are fully vested. The Company recognized compensation cost for stock option grants over the required service period based upon the grant date fair value, which is established using a Black-Scholes valuation model. The Black-Scholes valuation model uses assumptions of risk-free interest rate, expected term of stock options, expected stock price volatility and expected dividends. Forfeitures are recognized as they occur. In conjunction with the BTH merger, the Company assumed the BTH 2012 Equity Incentive Plan and converted all outstanding options to purchase BTH common stock into options to purchase an aggregate of 611,676 shares of the Company’s common stock. Under the terms of applicable change in control provisions within the BTH 2012 Equity Incentive Plan and BTH Notice Of Stock Option Award, all BTH stock options fully vested immediately prior to the closing of the merger that occurred on August 1, 2022. BTH converted options have no expiration dates past August 16, 2031, and no further grants will be made under the BTH 2012 Equity Incentive Plan. The table below summarizes the status of the Company’s stock options and changes during the years ended December 31, 2023, 2022, and 2021.
(Dollars in thousands, except per share amounts) | Number of Shares |  | Weighted Average Exercise Price |  | Weighted Average Remaining Contractual Term (in years) |  | Aggregate Intrinsic Value |
Year Ended December 31, 2023 |  |  |  |  |  |  |  |
Outstanding at January 1, 2023 | 504,437 |  |  | $ | 29.46 |  |  | 5.13 |  | $ | 3,736 |  |
Exercised | (135,746) |  |  | 23.61 |  |  | — |  |  | 1,533 |  |
Expired | (15,218) |  |  | 34.48 |  |  | — |  |  | — |  |
Outstanding and exercisable at December 31, 2023 | 353,473 |  |  | 31.49 |  |  | 4.46 |  | 1,670 |  |
Year Ended December 31, 2022 |  |  |  |  |  |  |  |
Outstanding at January 1, 2022 | 39,200 |  |  | $ | 10.73 |  |  | 2.28 |  | $ | 1,262 |  |
BTH options converted to OBK options | 611,676 |  |  | 28.62 |  |  | — |  |  | 8,838 |  |
Exercised | (144,785) |  |  | 20.80 |  |  | — |  |  | 2,992 |  |
Expired | (1,654) |  |  | 34.44 |  |  | — |  |  | — |  |
Outstanding and exercisable at December 31, 2022 | 504,437 |  |  | 29.46 |  |  | 5.13 |  | 3,736 |  |
Year Ended December 31, 2021 |  |  |  |  |  |  |  |
Outstanding at January 1, 2021 | 224,000 |  |  | $ | 10.86 |  |  | 4.92 |  | $ | 3,789 |  |
Exercised | (184,800) |  |  | 10.88 |  |  | — |  |  | 6,447 |  |
Outstanding and exercisable at December 31, 2021 | 39,200 |  |  | 10.73 |  |  | 2.28 |  | 1,262 |  |

X
- Definition The entire disclosure for share-based payment arrangement. + References Reference 1: http://www.xbrl.org/2003/role/exampleRef -Topic 718 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a)(1) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480429/718-10-50-2 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 718 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//718/tableOfContent Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 718 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480429/718-10-50-2 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 718 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (h)(2) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480429/718-10-50-2 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 718 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (h)(2)(i) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480429/718-10-50-2 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 718 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (l) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480429/718-10-50-2 + Details
Name: | us-gaap_DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_DisclosureOfCompensationRelatedCostsSharebasedPaymentsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration