Company: FSBC
Filing Date: 2025-08-07
Form Type: 10-Q
Source: 0001628280-25-038796
Chunk: 133

Company: FIVE STAR BANCORP
Filing Date: 2025-08-07
Form: 10-Q
Item: Part I, Item 8
Chunk 133
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 Star Bancorp 2021 Equity Incentive Plan (the “Equity Incentive Plan”). The Historical Incentive Plan consisted of RSAs for certain executive officers of the Company. The arrangement provided that these executive officers would receive shares of restricted common stock of the Company that vested over three years, with the number of shares granted based upon achieving certain performance objectives. These objectives included, but were not limited to, net income adjusted for the provision for credit losses, deposit growth, efficiency ratio, net interest margin, and asset quality. Compensation expense for RSAs granted under the Historical Incentive Plan is recognized over the service period, which is equal to the vesting period of the shares based on the fair value of the shares at issue date.In connection with its IPO in May 2021, the Company granted RSAs under the Equity Incentive Plan to certain employees, officers, executives, and non-employee directors. Shares granted to non-employee directors vested immediately upon grant, while shares granted to certain employees, officers, and executives vest ratably over three, five, or seven years (as defined in the respective agreements). Since the completion of the IPO, the Company has granted RSAs under the Equity Incentive Plan to certain executives, which vest ratably over three or five years (as defined in the respective agreements), and to directors, which vest over one year. All RSAs were granted at the fair value of common stock at the time of the award. The RSAs are considered fixed awards, as the number of shares and fair value are known at the date of grant and the fair value at the grant date is amortized over the service period.The Company recognized $0.4 million and $0.3 million of non-cash stock compensation expense for the three months ended June 30, 2025 and June 30, 2024, respectively. The Company recognized $0.6 million of non-cash stock compensation expense for both the six months ended June 30, 2025 and June 30, 2024, respectively.As of June 30, 2025, there was approximately $2.9 million of unrecognized compensation expense related to the 129,448 unvested restricted shares. The holders of unvested RSAs are entitled to dividends at the same per-share ratio as holders of common stock. Tax benefits for dividends paid on unvested RSAs are recorded as tax benefits in the consolidated statements of income with a corresponding decrease to current taxes payable.