The Company maintains the 2025 Stock Plan ("2025 Plan"), the 2021 Stock Plan ("2021 Plan"), the 2016 Stock Plan ("2016 Plan"), the 2006 Stock Plan ("2006 Plan"), the 2021 Employee Stock Purchase Plan ("2021 ESPP") and the 2011 Employee Stock Purchase Plan ("2011 ESPP").

In connection with the acquisition of Virginia Heritage Bank ("Virginia Heritage"), the Company assumed the Virginia Heritage 2006 Stock Option Plan and the 2010 Long Term Incentive Plan (the "Virginia Heritage Plans").

The Company adopted the 2025 Plan upon approval by the shareholders at the 2025 Annual Meeting held on May 15, 2025. The 2025 Plan provides directors and selected employees of the Bank, the Company and their affiliates with the opportunity to acquire shares of stock, through awards of options, time vested restricted stock, performance-based restricted stock and stock appreciation rights. Under the 2025 Plan, 925,000 shares of common stock were initially reserved for issuance. With shareholder approval of the 2025 Plan, no further awards shall be granted under the 2021 Plan. The 2021 Plan will remain in existence solely for the purpose of administering outstanding grants under the 2021 Plan. As of December 31, 2025, 476 shares of RSA have been granted under the 2025 Plan.

For awards that are service based, compensation expense is being recognized over the service (vesting) period based on fair value, which for stock option grants is computed using the Black-Scholes model.

For restricted stock awards granted under the 2021 Plan and 2025 Plan, fair value is based on the Company’s closing price on the date of grant. For awards that are performance-based, compensation expense is initially recorded based on the probability of achievement of the goals underlying the grant at target.

In February 2025, the Company awarded senior officers a targeted number of 147,702 performance vested restricted stock units ("PRSUs"). The vesting of PRSUs is 100% after three years with payouts based on threshold, target or maximum average performance targets over a three year period. There are two performance metrics: 1) total shareholder's return; and 2) EPS growth. In February 2025, the 2022 performance award vested and no incremental shares were awarded.

For awards that are time vested, the shares typically vest over a period of one to three years beginning on the first anniversary of the date of grant. The table below presents the time vested restricted stock awarded to senior officers, directors and certain employees.


	As of December 31, 2025
Date of award	Number of shares	Number of Officers, Directors and Employees
February 2025	204,164	129
March 2025	4,507	2
May 2025	2,597	1
July 2025	476	1

The Company has unvested restricted stock awards and PRSU grants of 710,469 shares as of December 31, 2025. Unrecognized stock based compensation expense related to restricted stock awards and PRSU grants totaled $6.1 million as of December 31, 2025. At such date, the weighted-average period over which this unrecognized expense was expected to be recognized was 1.93 years.


	For the Year Ended December 31,
	2025			2024			2023
Performance Awards	Shares	Weighted Average Grant Date Fair Value		Shares	Weighted Average Grant Date Fair Value		Shares	Weighted Average Grant Date Fair Value

Unvested at beginning	226,479	$	27.53	123,215	$	44.74	129,855	$	45.15
Granted	147,702	18.19		150,570	18.47		71,003	40.50
Forfeited	(33,035)	48.66		(28,826)	40.96		(44,084)	40.29
Vested	—	—		(18,480)	47.57		(33,559)	44.60
Unvested at end	341,146	$	21.44	226,479	$	27.53	123,215	$	44.74


	For the Year Ended December 31,
	2025			2024			2023
Time Vested Awards - RSA	Shares	Weighted Average Grant Date Fair Value		Shares	Weighted Average Grant Date Fair Value		Shares	Weighted Average Grant Date Fair Value
Unvested at beginning	430,305	$	31.35	313,992	$	49.08	302,148	$	53.75
Granted	211,744	23.20		312,368	23.22		190,256	44.16
Forfeited	(25,086)	24.86		(38,772)	36.18		(27,558)	51.57
Vested	(247,640)	32.81		(157,283)	49.41		(150,854)	51.76
Unvested at end	369,323	$	26.14	430,305	$	31.35	313,992	$	49.08


	For the Year Ended December 31,
	2025				2024				2023
Time Vested Awards - Options	Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term	Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term	Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term
Beginning balance	2,500	$	47.95	5.02	2,500	$	47.95	6.02	2,500	$	47.95	7.02
Granted	133,401	22.76		9.16	—	—		—	—	—		—
Exercised	—	—		—	—	—		—	—	—		—
Forfeited	—	—		—	—	—		—	—	—		—
Ending balance	135,901	$	23.22	9.07	2,500	$	47.95	5.02	2,500	$	47.95	6.02
Exercisable end of year	2,500	$	47.95	4.02	2,500	$	47.95	5.02	2,500	$	47.95	6.02

Grants of stock options have expected lives based on the "simplified" method allowed by ASC 718 "Compensation," whereby the expected term is equal to the midpoint between the vesting date and the end of the contractual term of the award.

There was no intrinsic value of outstanding stock options for both December 31, 2025 and 2024. The total fair value of stock options granted for the year ended December 31, 2025 was $1.1 million. There were no stock options granted in 2024 and 2023. As of December 31, 2025, there was $686 thousand of total unrecognized compensation expense related to non-vested stock options. The cost is expected to be recognized over a weighted-average period of 2.16 years.

The fair value of options granted was determined using the following weighted-average assumptions as of the grant date. No options were granted in 2024 and 2023.


	For the Year Ended December 31,
	2025		2024	2023
Risk-free interest rate	4.09	%	N/A	N/A
Expected term in years	6.44		N/A	N/A
Expected stock price volatility	43.94	%	N/A	N/A
Dividend yield	2.90	%	N/A	N/A

Approved by shareholders in May 2021, the 2021 ESPP reserved 200,000 shares of common stock for issuance to employees. Whole shares are sold to participants in the plan at 85% of the lower of the stock price at the beginning or end of each quarterly offering period. The 2021 ESPP is available to all eligible employees who have completed at least one year of continuous employment, work at least 20 hours per week and at least five months a year. Participants may contribute a minimum of $10 per pay period to a maximum of $25,000 annually (not to exceed more than 10% of compensation per pay period). As of December 31, 2025, the 2021 ESPP had 112,474 shares reserved for issuance.

Included in salaries and employee benefits in the accompanying Consolidated Statements of Operations, the Company recognized $7.0 million, $9.6 million and $10.0 million in stock-based compensation expense for 2025, 2024 and 2023, respectively. Stock-based compensation expense is recognized ratably over the requisite service period for all awards.