Common Stock and Earnings Per Share

3 Months Ended

Mar. 31, 2024

Common Stock, Number of Shares, Par Value and Other Disclosure [Abstract]

Common Stock and Earnings Per Share

Common Stock and Earnings Per Share

Treasury Stock Repurchase Program

Mid Penn adopted a treasury stock repurchase program ("Program") initially effective March 19, 2020, and renewed through April 24, 2025 by Mid Penn’s Board of Directors on April 24, 2024. The Program authorizes the repurchase of up to $15.0 million of Mid Penn’s outstanding common stock. Under the Program, Mid Penn conducts repurchases of its common stock through open market transactions (which may be by means of a trading plan adopted under SEC Rule 10b5-1) or in privately negotiated transactions. Repurchases under the Program are made at the discretion of management and are subject to market conditions and other factors. There is no guarantee as to the exact number of shares that Mid Penn may repurchase. The Program is able to be modified, suspended or terminated at any time, at Mid Penn’s discretion, based upon a number of factors, including liquidity, market conditions, the availability of alternative investment opportunities and other factors Mid Penn deems appropriate. The Program does not obligate Mid Penn to repurchase any shares.

During the three months ended March 31, 2024, Mid Penn repurchased 15,500 shares of common stock at an average price of $20.81. As of March 31, 2024, Mid Penn had repurchased 440,722 shares of common stock at an average price of $22.78 per share under the Program. The Program had approximately $5.0 million remaining available for repurchase as of March 31, 2024.

Dividend Reinvestment Plan

Under Mid Penn’s amended and restated DRIP, 300,000 shares of Mid Penn’s authorized but unissued common stock are reserved for issuance. The DRIP also allows for voluntary cash payments, within specified limits, to be used for the purchase of additional shares.

Equity Incentive Plans

On May 9, 2023, shareholders approved the 2023 Stock Incentive Plan, which authorizes Mid Penn to grant incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock, deferred stock units and performance shares. The 2023 Plan was established for employees and directors of Mid Penn and the Bank, selected by the Compensation Committee of the Board of Directors, to incentivize the further success of the Company, and replaces the 2014 Restricted Stock Plan. The aggregate number of shares of common stock of the Company available for issuance under the Plan is 350,000 shares.

As of March 31, 2024, a total of 217,514 restricted shares were granted under the 2014 Plan, of which 83,107 shares were unvested. The 2014 Plan shares granted and vested resulted in $302 thousand and $249 thousand in share-based compensation expense for the three months ended March 31, 2024 and 2023, respectively.

Share-based compensation expense relating to restricted stock is calculated using grant date fair value and is recognized on a straight-line basis over the vesting periods of the awards. Restricted shares granted to employees vest in equal amounts on the anniversary of the grant date over the vesting period and the expense is a component of salaries and benefits expense on the Consolidated Statement of Income. The employee grant vesting period is determined by the terms of each respective grant, with vesting periods generally between one and four years. Restricted shares granted to directors have a twelve-month vesting period, and the expense is a component of directors’ fees and benefits within the other expense line item on the Consolidated Statement of Income.

The following data shows the amounts used in computing basic and diluted earnings per common share:

	Three Months Ended March 31,
(In thousands, except per share data)	2024		2023
Net income	$	12,133	$	11,227
Weighted average common shares outstanding (basic)	16,567,902		15,886,186
Effect of dilutive unvested restricted stock grants	45,471		44,935
Weighted average common shares outstanding (diluted)	16,613,373		15,931,121
Basic earnings per common share	$	0.73	$	0.71
Diluted earnings per common share	0.73		0.70

There were no antidilutive instruments at March 31, 2024 and 2023.