Stock and Incentive Compensation Plans

3 Months Ended

Mar. 31, 2014

Stock and Incentive Compensation Plans [Abstract]

Stock and Incentive Compensation Plans

Note 11 – Stock and Incentive Compensation Plans

Trustmark has granted, and currently has outstanding, stock and incentive compensation awards subject to the provisions of the 1997 Long Term Incentive Plan (the 1997 Plan) and the 2005 Stock and Incentive Compensation Plan (the 2005 Plan).  New awards have not been issued under the 1997 Plan since it was replaced by the 2005 Plan.The 2005 Plan is designed to provide flexibility to Trustmark regarding its ability to motivate, attract and retain the services of key associates and directors.  The 2005 Plan allows Trustmark to make grants of nonqualified stock options, incentive stock options, stock appreciation rights, restricted stock, restricted stock units and performance units to key associates and directors.

Stock Option Grants

Stock option awards under the 1997 Plan and the 2005 Plan were granted with an exercise price equal to the market price of Trustmark’s stock on the date of grant, and vested equally in annual increments.  No stock options have been granted since 2006, when Trustmark began granting restricted stock awards exclusively.

Restricted Stock Grants

Performance Awards

Trustmark’s performance awards are granted to Trustmark’s executive and senior management team.  Performance awards granted vest based on performance goals of return on average tangible equity (ROATE) and total shareholder return (TSR) compared to a defined peer group.  Performance awards are valued utilizing a Monte Carlo simulation model to estimate fair value of the awards at the grant date.  These awards are recognized using the straight-line method over the requisite service period.  These awards provide for achievement shares if performance measures exceed 100%.  The restricted share agreement provides for voting rights and dividend privileges.

Time-Vested Awards

Trustmark’s time-vested awards are granted to Trustmark’s Board of Directors, executive and senior management team.  Time-vested awards are valued utilizing the fair value of Trustmark’s stock at the grant date.  These awards are recognized on the straight-line method over the requisite service period.

The following table summarizes the stock and incentive plans’ vesting periods and contractual terms in years:

	Vesting		Contractual
	Period		Term
Stock option awards - 1997 plan		4		10
Stock option awards - 2005 plan		5		7
Performance awards (includes acheivement shares for grants after 2013)		3		-
Achievement shares from performance grants prior to 2013		3		-
Time-vested awards		3		-

The following tables summarize the stock and incentive plan activity for the periods presented:

	Three Months Ended March 31, 2014
	Stock			Performance			Time-Vested
	Options			Awards			Awards
Outstanding/Nonvested shares or units, beginning of period		105,450			160,520			291,634
Granted		-			73,726			103,690
Granted - achievement shares		-			-			-
Exercised or released from restriction		-			(38,580	)		(60,339	)
Expired		(6,000	)		-			-
Forfeited		-			(11,533	)		(1,247	)
Outstanding/Nonvested shares or units, end of period		99,450			184,133			333,738

The following table presents information regarding compensation expense for stock and incentive plans for the periods presented ($ in thousands):

	Three Months Ended March 31,
	2014		2013
Compensation expense - Stock and Incentive plans:
Performance awards	$	263	$	211
Time-vested awards		928		811
Total	$	1,191	$	1,022