California BanCorp \ CABCAL
California BanCorp \ CA Stock Compensation Disclosure
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.
In October 2020, the maximum number of shares under the 2019 Plan was increased by 300,000 to 2,500,000. In June 2021, the maximum number of shares under the 2019 Plan was increased by 900,000 to 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 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 year ended December 31, 2025, total stock-based compensation cost related to stock options and restricted shares units was $5.8 million. For the year ended December 31, 2024, total stock-based compensation cost related to stock options and restricted shares units was $6.2 million. Included in this amount was $1.1 million related to the acceleration of vesting for replacement awards issued in connection with the Merger to non-continuing directors, executives and employees.
Stock Options
As of December 31, 2025, there was $9 thousand of total unrecognized compensation cost related to the outstanding stock options to be recognized over a period of 0.9 years. There were 18,013 and 112,275 stock options exercised with the intrinsic value of $146 thousand and $788 thousand in 2025 and
2024, respectively. There were approximately $406 thousand in related tax benefits for the disqualifying disposition of incentive stock options (“ISO”) exercised for the year ended December 31, 2025. There were $72 thousand related tax expense for non-qualified stock option exercised for the year ended December 31, 2024. There were no disqualifying disposition of ISO exercised during the year ended December 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 years ended December 31, 2025 and 2024.
A summary of changes in outstanding stock options during the years ended December 31, 2025 and 2024 are presented below:
| (dollars in thousands, except share data) | Shares | Weighted Average Exercise Price | Weighted Average Remaining Contractual Term | Aggregate Intrinsic Value | ||||||||||||||||||||||
December 31, 2025 | ||||||||||||||||||||||||||
| Outstanding at beginning of year | 136,888 | $ | 9.64 | |||||||||||||||||||||||
| Granted | — | $ | — | |||||||||||||||||||||||
| Exercised | (18,013) | $ | 7.34 | |||||||||||||||||||||||
| Expired | — | $ | — | |||||||||||||||||||||||
| Forfeited | — | $ | — | |||||||||||||||||||||||
| Outstanding at end of year | 118,875 | $ | 9.98 | 2.0 Years | $ | 1,033 | ||||||||||||||||||||
| Options exercisable | 117,325 | $ | 9.97 | 2.0 Years | $ | 1,021 | ||||||||||||||||||||
| (dollars in thousands, except share data) | Shares | Weighted Average Exercise Price | Weighted Average Remaining Contractual Term | Aggregate Intrinsic Value | ||||||||||||||||||||||
December 31, 2024 | ||||||||||||||||||||||||||
| Outstanding at beginning of year | 272,813 | $ | 9.30 | |||||||||||||||||||||||
| Granted | — | $ | — | |||||||||||||||||||||||
| Exercised | (112,275) | $ | 8.47 | |||||||||||||||||||||||
| Expired | (750) | $ | 5.93 | |||||||||||||||||||||||
| Forfeited | (22,900) | $ | 11.48 | |||||||||||||||||||||||
| Outstanding at end of year | 136,888 | $ | 9.64 | 2.8 Years | $ | 945 | ||||||||||||||||||||
| Options exercisable | 132,388 | $ | 9.61 | 2.7 Years | $ | 918 | ||||||||||||||||||||
Restricted Stock Units
A summary of the changes in outstanding unvested restricted stock units during the years ended December 31, 2025 and 2024 is presented below:
December 31, 2025 | Restricted Shares | Weighted Average Grant Date Fair Value | ||||||||||||
| Unvested at beginning of year | 1,048,899 | $ | 14.73 | |||||||||||
| Granted | 201,139 | $ | 15.71 | |||||||||||
| Vested | (503,406) | $ | 13.92 | |||||||||||
| Forfeited | (32,727) | $ | 16.12 | |||||||||||
| Unvested at end of year | 713,905 | $ | 15.51 | |||||||||||
December 31, 2024 | Restricted Shares | Weighted Average Grant Date Fair Value | ||||||||||||
| Unvested at beginning of year | 637,899 | $ | 13.11 | |||||||||||
Granted(1) | 958,016 | $ | 15.49 | |||||||||||
Vested(2) | (430,179) | $ | 13.78 | |||||||||||
| Forfeited | (116,837) | $ | 15.69 | |||||||||||
| Unvested at end of year | 1,048,899 | $ | 14.73 | |||||||||||
(1)Includes 418,634 shares granted as replacement awards to continuing and non-continuing directors, executives and employees in connection with the Merger for the year ended December 31, 2024. The fair value of these replacement awards attributable to post-combination vesting a) will be recognized over the remaining vesting period for continuing directors, executives and employees and b) was immediately recognized for non-continuing directors, executives and employees as components of compensation expense.
(2)Includes the discretionary vesting of 123,123 replacement awards issued in connection with the Merger for non-continuing directors, executives and employees for the year ended December 31, 2024.
As of December 31, 2025, there was $7.7 million of total unrecognized compensation expense related to the outstanding restricted stock units that will be recognized over the weighted-average period of 2.7 years. The total grant date fair value of restricted stock units vested during 2025 and 2024 was $7.0 million and $5.9 million, respectively. Related tax benefits were approximately $19 thousand and $307 thousand for the years ended December 31, 2025 and 2024, respectively.Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 13, 2026 | Showing above |
| 2024 | Apr 1, 2025 | |
| 2023 | Mar 15, 2024 | |
About Stock Compensation Disclosures
Stock-based compensation disclosures detail the equity awards granted to employees and executives — including stock options, restricted stock units (RSUs), and performance shares — along with the valuation methods and assumptions used to expense them. This section reveals the true cost of talent retention and the alignment between management incentives and shareholder interests.
Key signals: total unrecognized compensation expense and its expected recognition period signal future earnings headwinds from already-granted awards. For stock options, examine Black-Scholes assumptions — expected volatility, risk-free rate, and expected term — as understating any of these reduces reported compensation expense. Compare stock compensation expense as a percentage of revenue against peers to assess dilution cost. Watch vesting schedules for acceleration clauses tied to change-of-control events. Performance-based awards with undemanding targets may indicate weak governance. Add back stock compensation to operating cash flow to calculate a more conservative free cash flow figure.