UNITED COMMUNITY BANKS INCUCB

UNITED COMMUNITY BANKS INC Stock Compensation Disclosure

10-KFiled Feb 17, 20263 min read
Equity Compensation Plans
United has an equity compensation plan that allows for grants of various stock-based compensation. The general terms of the plan include a vesting period (usually four years) with an exercisable period not to exceed ten years. Certain options and restricted stock unit awards provide for accelerated vesting if there is a change in control of United or certain other conditions are met (as defined in the plan document). As of December 31, 2025, 1.38 million additional awards could be granted under the plan.
 
Restricted stock units and options outstanding and activity for the years ended December 31 consisted of the following:
 Restricted Stock UnitsOptions
SharesWeighted Average Grant Date Fair ValueAggregate
Intrinsic
Value (000’s)		SharesWeighted Average Exercise PriceWeighted Average Remaining Term (Yrs.)Aggregate Intrinsic Value (000’s)
December 31, 2022778,686 $28.28 40,338 $11.88 
Granted / Assumed
542,388 28.98 643,298 20.91 
Vested / Exercised(311,219)26.95 (272,279)19.06 
Cancelled(80,488)31.21 (4,620)25.97 
December 31, 2023929,367 28.85 406,737 21.19 
Granted
540,566 29.26 — — 
Vested / Exercised(276,144)26.89 (119,627)21.10 
Cancelled(91,812)28.30 (2,353)26.05 
December 31, 20241,101,977 29.61 284,757 21.18 
Granted
487,755 33.01 — — 
Vested / Exercised(363,937)29.93 $11,460 (90,081)20.20 $972 
Cancelled(94,931)29.62 (984)28.45 
December 31, 20251,130,864 30.98 35,306 193,692 21.61 3.41,862 

Compensation expense for restricted stock units without market conditions is based on the market value of United’s common stock on the date of grant. United recognizes the impact of forfeitures as they occur. The value of restricted stock unit awards is amortized into expense over the service period. 
 
In addition to time-based restricted stock unit awards, the Board has also approved performance-based restricted stock units (“PSUs”), which vest based on achieving certain performance and market targets relative to a bank peer group. Achievement of the target-level performance and market criteria for all applicable periods will result in the issuance of 228,986 shares, which are included in the outstanding balance as of December 31, 2025 in the table above. The actual number of shares issued related to the
vesting of PSUs may be greater or less than target depending on the achievement of the performance and market criteria during any applicable performance period. The grant date per share fair market value of PSUs is estimated using the Monte Carlo Simulation valuation model.

Compensation expense recognized in the consolidated statements of income for employee restricted stock unit awards in 2025, 2024 and 2023 was $10.6 million, $10.1 million and $8.21 million, respectively, which was recognized in salaries and employee benefits expense. In addition, in 2025, 2024 and 2023, $810,000, $743,000 and $725,000, respectively, was recognized in other operating expense for restricted stock unit awards granted to members of the Board. Deferred income tax benefits related to stock-based compensation expense of $2.86 million, $2.73 million and $2.28 million were included in the determination of income tax expense in 2025, 2024 and 2023, respectively. As of December 31, 2025, there was $26.1 million of unrecognized compensation cost related to restricted stock units granted under the plan. The cost is expected to be recognized over a weighted-average period of 2.6 years.

Options granted or assumed in 2023 were related to the Progress acquisition, with the weighted average exercise price of the acquired institution’s fully vested converted options determined pursuant to the purchase agreement. The value of the options was determined using a Black-Scholes model and was included in the acquisition’s purchase price. No compensation expense relating to options was included in earnings for 2025, 2024 or 2023. All outstanding options were vested and exercisable at December 31, 2025.

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.

Other Available Disclosures

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