Form 4: ORRF Exec Khuri Reports Future Stock Grants & Vesting

Orrstown Financial Services EVP, Chief Revenue Officer Zachary Moses Khuri reported future grants and vesting of restricted stock and restricted stock units scheduled for February 17, 2026.

Summary

• Zachary Moses Khuri, EVP, Chief Revenue Officer of Orrstown Financial Services Inc. (ORRF), reported transactions scheduled for February 17, 2026.
• These transactions include the vesting of previously awarded time-vested restricted stock, with 372 shares disposed of at $37.64 to cover tax liabilities, leaving 1,670 shares of this type beneficially owned.
• Khuri was granted 2,122 new shares of time-vested restricted stock at a price of $0, bringing his total beneficial ownership of this type to 3,792 shares. These shares vest over the next three years.
• Additionally, performance-based restricted stock units vested, with 1,651 shares disposed of at $37.64 for tax purposes, leaving 5,640 units of this type beneficially owned.
• He also received a new grant of 2,587 restricted stock units at a price of $0, increasing his total beneficial ownership of this type to 8,227 units. These units vest three years after the award date based on pre-established company performance criteria.
• Khuri also directly owns 20,944 shares of Orrstown Financial Services, Inc. Common Stock, separate from the restricted stock and units.

Sentiment

Score: 7

Explanation: StockSavvy.ai views this as a moderately positive signal, reflecting ongoing executive commitment and standard compensation practices, which are generally favorable for stability and long-term alignment.

Positives

• The grants of 2,122 time-vested restricted stock and 2,587 performance-based restricted stock units indicate continued compensation and retention of a key executive.
• The performance-based nature of the restricted stock units aligns executive incentives with company performance, promoting long-term value creation.

Negatives

• The disposal of shares to cover tax liabilities, while a standard practice for equity compensation, represents a reduction in direct shareholding from vesting events.

Future Outlook

The grants of restricted stock and units with vesting periods over the next three years indicate a long-term incentive structure for the EVP, Chief Revenue Officer, aligning his future with the company's performance and growth.

Industry Context

StockSavvy.ai notes that executive equity compensation, including restricted stock and restricted stock units, is a standard practice in the financial services industry to attract, retain, and incentivize key personnel. The structure, combining time-based and performance-based vesting, is common for aligning executive interests with long-term shareholder value in regional banks like Orrstown Financial Services.

Comparison to Industry Standards

• The use of both time-vested restricted stock and performance-based restricted stock units is a common compensation strategy among U.S. regional banks, similar to practices seen at peers like Fulton Financial Corporation (FULT) or Community Bank System, Inc. (CBU).
• The vesting periods, typically 3 years for performance-based units and staggered for time-vested stock, are consistent with industry benchmarks designed to promote long-term executive retention and performance alignment.
• The share price of $37.64 for tax-related dispositions is within the typical trading range for regional bank stocks of similar market capitalization.

Related Party Transactions

• The reported transactions are equity grants and vestings to an executive officer, which are considered related-party transactions in the context of executive compensation.

Stakeholder Impact

• Shareholders: The grants align executive incentives with shareholder interests, particularly the performance-based units, promoting long-term value. Tax-related dispositions are a normal part of equity compensation.
• Employees: Reflects standard executive compensation practices within the company, potentially influencing morale and retention strategies for other key personnel.

Next Steps

• Continued vesting of time-vested restricted stock over the next three years.
• Vesting of performance-based restricted stock units three years after the award date, contingent on company performance criteria.

Key Dates

Recommendation

This Form 4 details routine executive compensation events (grants and vestings) for a key officer. While it shows continued alignment of executive interests with the company's long-term performance, it does not present new information that would fundamentally alter the investment thesis for Orrstown Financial Services. Therefore, a 'hold' recommendation is appropriate, as the filing reinforces existing expectations without providing catalysts for a significant re-evaluation.

Keywords

Orrstown Financial Services, ORRF, Zachary Moses Khuri, Restricted Stock, Restricted Stock Units, Executive Compensation, Insider Trading, Form 4, Equity Grant, Stock Vesting