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STOCK-BASED COMPENSATION PLAN
 3 Months Ended
Mar. 31, 2025
Share-Based Payment Arrangement [Abstract]  
STOCK-BASED COMPENSATION PLAN STOCK-BASED COMPENSATION PLAN
In contemplation of the holding company reorganization, in November 2019 the Company’s Board of Directors adopted the Southern California Bancorp 2019 Omnibus Equity Incentive Plan (the “2019 Plan”). The 2019 Plan was approved by shareholders in April 2020 with a maximum number of shares of common stock that may be issued or paid out under the plan of 2,200,000. In addition, upon the completion of the bank holding company reorganization in 2020, the Bank’s 2001 Stock Option Plan and 2011 Omnibus Equity Incentive Plan were terminated and all outstanding and unexpired stock options and all shares of restricted stock outstanding under the terminated plans became equivalent awards of the Company under the 2019 Plan.
At March 31, 2025, the maximum number of shares under the 2019 Plan was 3,400,000.
In addition, the 2019 Plan permits the Company to grant additional stock options and restricted share units. The Plan provides for the granting to eligible participants such incentive awards as the Board of Directors or a committee established by the Board, in its sole discretion, to administer the Plan. The Board has the power to determine the terms of the awards, including the exercise price, the number of shares subject to each award, the vesting and exercisability of the awards and the form of consideration payable upon exercise. Stock options expire no later than ten years from the date of the grant. The 2019 Plan provides for accelerated vesting if there is a change of control, as defined in the Plan. Restricted stock units generally vest over a period of one to five years.
Future levels of compensation cost recognized related to stock-based compensation awards may be impacted by new awards and/or modifications, repurchases and cancellations of existing awards.Under the terms of the 2019 Plan, vested options generally expire ninety days after the director or employee terminates their service affiliation with the Company.
In connection with the Merger, each of the 185,878 outstanding, unvested restricted stock units granted to the continuing directors, executives and employees under CALB’s Amended and Restated 2017 Equity Incentive Plan were converted into 295,512 unvested restricted stock units of the Company. Each such converted restricted stock unit award continues to be subject to the same terms and conditions as were applicable to the corresponding CALB restricted stock unit award immediately prior to the Merger. The weighted average remaining term on these assumed restricted stock units was 4.0 years, ranging from two months to 5.0 years. All outstanding unvested CALB restricted stock units of 77,436 shares in aggregate that were held by employees who are not continuing directors, executives and employees were accelerated and became fully vested and converted automatically into the right to receive approximately 82,364 shares of the Company’s common stock after 25,635 of CALB shares were surrendered by certain executives and employees to pay for taxes at the effective time of the Merger.
For the three months ended March 31, 2025, total stock-based compensation cost related to stock options and restricted stock units was $1.5 million. For the three months ended March 31, 2024, total stock-based compensation cost related to stock options and restricted stock units was $895 thousand.
Stock Options
As of March 31, 2025, there was $17 thousand of total unrecognized compensation cost related to the outstanding stock options. There were 5,138 stock options exercised with the intrinsic value of $40 thousand during the three months ended March 31, 2025, and 81,400 stock options exercised with the intrinsic value of $558 thousand during the three months ended March 31, 2024. There were no related tax expense for non-qualified stock option exercised for the three months ended March 31, 2025. Related tax expense for non-qualified stock option exercised were approximately $26 thousand for the three months ended March 31, 2024.
The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model. There were no options granted during the three months ended March 31, 2025 and 2024.
A summary of changes in outstanding stock options during the three months ended March 31, 2025 and 2024 are presented below:
Three Months Ended
March 31, 2025
(dollars in thousands, except share data)SharesWeighted
Average
Exercise
Price
Weighted Average Remaining Contractual Term
(Years)
Aggregate Intrinsic
Value
Outstanding at beginning of period136,888 $9.64 
Granted— $— 
Exercised(5,138)$7.81 
Expired— $— 
Forfeited — $— 
Outstanding at end of period131,750 $9.71 2.6$609 
Options exercisable128,650 $9.68 2.5$599 


Three Months Ended
March 31, 2024
(dollars in thousands, except share data)SharesWeighted
Average
Exercise
Price
Weighted Average Remaining Contractual Term
(Years)
Aggregate Intrinsic
Value
Outstanding at beginning of period272,813 $9.30 
Granted— $— 
Exercised(81,400)$8.68 
Forfeited (15,300)$10.75 
Outstanding at end of period175,363 $9.48 3.3$953 
Options exercisable169,163 $9.43 3.2$926 


Restricted Stock Units
A summary of the changes in outstanding unvested restricted stock units during the three months ended March 31, 2025 and 2024 is presented below:
Three Months Ended
March 31, 2025
Restricted
Shares		Weighted Average Grant Date Fair Value
Unvested at beginning of period1,048,899 $14.73 
Granted
131,263 $15.94 
Vested
(197,948)$15.79 
Forfeited (5,166)$15.81 
Unvested at end of period977,048 $14.65 
Three Months Ended
March 31, 2024
Restricted
Shares		Weighted Average Grant Date Fair Value
Unvested at beginning of period637,899 $13.11 
Granted168,035 $15.25 
Vested
(110,084)$16.14 
Forfeited (4,839)$15.50 
Unvested at end of period691,011 $13.13 

As of March 31, 2025, the Company did not have any outstanding unvested restricted stock units subject to various financial performance conditions.
As of March 31, 2025, there was $11.3 million of total unrecognized compensation expense related to the outstanding restricted stock units that will be recognized over the weighted-average period of 3.0 years. The total unrecognized compensation expense included $1.7 million related to the fair value of outstanding restricted stock units that was assumed from the Merger which will be recognized over the weighted-average vesting period of 3.3 years. The total grant date fair value of restricted stock units vested was $3.1 million for the three months ended March 31, 2025, and $1.8 million for the three months ended March 31, 2024. Related tax expenses were approximately $5 thousand for the three months ended March 31, 2025, and approximately $53 thousand for the three months ended March 31, 2024.