What changed in this filing

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Item 1A. Risk Factors

2026-03-16 compared with 2025-03-12 · 77 added, 68 removed, 396 unchanged (27% of the section changed)

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In response to generally declining inflation during 2023 and 2024, the Federal Reserve decreased target interest rates from September to December 2024, on a cumulative basis, by 100 basis points.

The Federal Reserve issued another series of rate cuts from September to December 2025, decreasing target interest rates by 75 basis points on a cumulative basis.

New appointments to the Federal Reserve’s Board of Governors or increased political pressures on the Federal Reserve could result in changes to monetary policy and interest rates.

Our business may also be adversely affected by declines in economic growth, business activity, investor or business confidence;

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unemployment;

rising domestic political tensions, such as uncertainty caused by the transition to a new Presidential administration in 2025;

rising domestic political tensions;

risks of government shutdowns;

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trade policies may also adversely impact our business and operations.

For example, changes in tariffs imposed or threatened to be imposed by the new Presidential administration may cause inflation, which can adversely affect our business as discussed elsewhere in this report.

For example, changes in tariffs imposed or threatened to be imposed by the current administration may cause inflation and other economic volatility, which can adversely affect our business as discussed elsewhere in this report.

Economic uncertainty and negative events in the economy or in domestic political or geopolitical matters could have a material adverse effect on our business, results of operations and financial condition, including our liquidity position.

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Between September 2024 and December 2024, the Federal Reserve lowered the federal funds target rate by 100 basis points on a cumulative basis.

The Federal Reserve conducted another series of rate cuts between September 2025 through December 2025, lowering the federal funds target rate by 75 basis points on a cumulative basis.

Our earnings depend significantly on our net interest income, which is the difference between interest income on interest-earning assets, such as loans and securities, and interest expense on interest-bearing liabilities, such as deposits and borrowings.

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High interest rates in 2023 and 2024 caused interest expense on deposits t o increase significantly in 2023 and 2024, putting pressure on our net interest margin.

Our cost of interest-bearing deposits rose to 3.38% in 2024 from 2.49% in 2023 and 0.42% in 2022.

We may experience additional pressure on our net interest margin during 2025 if our cost of funds increases faster than the yield on our interest-earning assets.

Our cost of interest-bearing deposits rose to 3.38% in 2024 from 2.49% in 2023.

While the cost of deposits has decreased slightly to 3.04% in 2025, it still remains elevated.

We may experience additional pressure on our net interest margin during 2026 if our yield on our interest-earning assets decreases faster than the cost of funds.

Additionally, due in large part to higher interest rates and market volatility during 2024 and 2025, gross unrealized losses in our AFS investment securities portfolio totaled $46.4 million at December 31, 2025 and $61.7 million at December 31, 2024.

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We also may not be able to adequately prepare for or compensate for the consequences of such changes.

Significant increases in interest rates, as occurred in 2022 and 2023, makes our business and our balance sheet more challenging to manage.

Significant fluctuations in interest rates, as occurred from 2022 through 2025, makes our business and our balance sheet more challenging to manage.

Any failure to predict and prepare for changes in interest rates or adjust for the consequences of these changes may adversely affect our earnings and capital levels.

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The primary source of the Bank’s funds are customer deposits, loan repayments and investment securities maturities or sales, while borrowings are a secondary source of liquidity.

We also use brokered deposits from time to time and our use of brokered deposits increased over the last two years.

We also use brokered deposits from time to time.

Brokered deposits tend to be more sensitive to changes in interest rates than other types of deposits and therefore can be a more expensive and uncertain source of funds.

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Any decline in available funding could adversely impact our ability to originate loans, invest in securities, meet our expenses, pay dividends to our shareholders, or to fulfill obligations such as repaying our borrowings or meeting deposit withdrawal demands, any of which could have a material adverse impact on our business, financial condition, results of operations and long-term growth prospects.

The highly-publicized failures of Silicon Valley Bank, Signature Bank and First Republic Bank during the first half of 2023 caused significant disruptions in the banking industry.

These industry developments negatively impacted overall customer confidence in the safety of their deposits, particularly uninsured deposits, at some regional banks.

As a result, some customers moved deposits to, or maintained deposits with, larger financial institutions or moved funds to investment alternatives outside the banking industry.

The rapid failures of these large banks highlighted risks associated with advances in technology that increase the speed at which information, concerns and rumors can spread through traditional and new media and increase the speed at which deposits can be moved from bank to bank or outside the banking system, heightening liquidity concerns of traditional banks.

Advances in technology that increase the speed at which information, concerns and rumors can spread through traditional and new media can increase the speed at which deposits can be moved from bank to bank or outside the banking system, heightening liquidity concerns of traditional banks.

Regulators and the largest U.S.

banks took steps designed to increase liquidity at regional banks and strengthen depositor confidence in the broader banking industry, including the Bank Term Funding Program discussed elsewhere in this report and measures to protect uninsured deposits from loss;

however, there are no guarantees that such steps would be implemented in the future if a similar disruption in the industry were to occur.

banks have taken steps designed to increase liquidity at regional banks and strengthen depositor confidence in the broader banking industry, including measures to protect uninsured deposits from loss;

however, there are no guarantees that such steps would be implemented in the future if a disruption in the industry were to occur.

For more information on the Company’s deposits and liquidity position, see Part I.

Management’s Discussion and Analysis of Financial Condition and Results of Operations under the headings “Certain Events That Affect Period-over-Period Comparability,” “Discussion and Analysis of Financial Condition – Deposits” and “Liquidity and Capital Resources.” Concerns about liquidity in the banking industry and the safety of uninsured deposits that may result from similar events in the future may materially adversely impact our liquidity, cost of funds, loan funding capacity, net interest margin, capital and results of operations.

Management’s Discussion and Analysis of Financial Condition and Results of Operations under the headings “ Certain Events That Affect Year-over-Year Comparability ,” “ Discussion and Analysis of Financial Condition – Deposits ” and “ Liquidity and Capital Resources.

” Concerns about liquidity in the banking industry and the safety of uninsured deposits that may result in the future may materially adversely impact our liquidity, cost of funds, loan funding capacity, net interest margin, capital and results of operations.

Inflation and rising prices may continue to adversely affect our results of operations and financial condition.

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After June 2022, the rate of inflation generally declined;

however, it began increasing in the later part of 2024 and has remained at elevated levels compared to the Federal Reserve’s target rate of inflation of two percent.

however, it began increasing in the later part of 2024 through January 2025.

The rate of inflation subsequently declined through April 2025, followed by a cumulative increase through year-end 2025.

It has remained at elevated levels compared to the Federal Reserve’s target rate of inflation of two percent.

Inflation increases our borrowers’ costs of living and costs of doing business, which may make it more difficult for them to repay their loans, increasing our credit risk.

Inflation also increases many of our operating costs, including the costs of goods and services we purchase and the costs of salaries and benefits.

We believe that higher rates resulting from inflation and related factors led to constrained loan demand during 2023 and 2024.

We believe that higher rates resulting from inflation and related factors led to constrained loan demand in 2023 and 2024, and to a lesser extent in 2025.

When the rate of inflation accelerates, there is an erosion of consumer and customer purchasing power.

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Our allowance for credit losses may prove to be insufficient to absorb losses inherent in our loan portfolio, and we may be required to further increase our provision for credit losses.

This risk may be heightened by our adoption of the Current Expected Credit Loss accounting standard effective January 1, 2023.

If our actual credit losses exceed our allowance for credit losses, our net income will decrease.

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The determination of the appropriate level of the allowance is inherently subjective, involves a high degree of judgment and complexity, and requires us to make significant estimates, all of which are subject to material changes.

In June 2016, the FASB issued ASU 2016-13, referred to as CECL, that requires that the measurement of all expected credit losses for financial assets held at the reporting date be based on historical experience, current conditions, and reasonable and supportable forecasts, and requires enhanced disclosures related to the significant estimates and judgments used in estimating credit losses, as well as the credit quality and underwriting standards of an organization’s portfolio.

In addition, the standard amends the accounting for credit losses on purchased financial assets with credit deterioration.

ASU 2016-13 became effective for us, as a smaller reporting company, on January 1, 2023.

Please refer to Note 1.

Summary of Significant Accounting Policies – Recent Accounting Pronouncements, for additional discussion.

The CECL methodology requires that lifetime “expected credit losses” be recorded at the time the financial asset is originated or acquired, and be adjusted each quarter for changes in expected lifetime credit losses.

The CECL methodology replaces multiple prior impairment models under GAAP that generally required that a loss be “incurred” before it was recognized, and represents a significant change from prior GAAP.

Our ongoing estimates of expected credit losses will depend upon our models and assumptions, existing and forecasted macroeconomic conditions and the credit quality, composition and other characteristics of our loan and other applicable portfolios.

We believe these factors are likely to cause variability in our expected credit losses under CECL compared to previous GAAP, and therefore an increase in the variability of our period-to-period net income.

We believe that CECL is also likely to reduce comparability across financial services companies due to the ability to adopt different measurement approaches for expected credit losses and different economic assumptions used in each of the companies’ models.

Commercial and industrial and commercial real estate loans generally are viewed as having more risk of default than residential real estate loans or other loans or investments.

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If our actual credit losses exceed our ACL, our net income will decrease.

Our pivot during 2023 from primarily a growth strategy to a near-term strategy focused primarily on consistent, quality earnings through the optimization of our balance sheet may not be successful in increasing our profitability .

During 2023, we pivoted our near-term strategy from primarily a growth strategy to primarily a focus on consistent, quality earnings through the optimization of our balance sheet, as described elsewhere in this report.

Our new strategy may not be successful in increasing our profitability.

Our near-term strategy includes continuing to consider acquisitions on an opportunistic basis.

Our long-term business strategy includes both organic growth and the continuation of our multi-state growth plans, and our financial condition and results of operations could be negatively affected if we fail to grow or fail to manage our growth effectively.

In addition to organic growth, we have grown our business through de novo branching and through the acquisition of other financial institutions and branch locations.

We have completed seven whole-bank acquisitions since 2011 and regularly review acquisition opportunities.

W e have also expanded our operations outside our historical south Louisiana base and into Texas and Alabama.

Our business strategy includes both organic growth and the continuation of our multi-state growth plans, and our financial condition and results of operations could be negatively affected if we fail to grow or fail to manage our growth effectively.

Our strategy focused on consistent, quality earnings through the optimization of our balance sheet may not be successful in increasing our profitability.

Over the long-term, we intend to pursue a multi-state growth strategy for our business primarily through attractive acquisition opportunities as well as continue to pursue organic growth throughout our franchise.

We have grown our business through de novo branching and through the acquisition of other financial institutions and branch locations, and we have expanded our operations outside our historical south Louisiana base and into Texas and Alabama.

Our long-term growth prospects must be considered in light of the risks, expenses and difficulties frequently encountered by companies when expanding their franchise, including the following:

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Of our Bank’s branch network, these two locations were geographically the most distant from our Louisiana headquarters.

During 2024, we began to reinvest within our Texas markets, including through the conversion of an existing loan and deposit production office to a full-service branch location in the southeast Texas market and strategic hires.

Acquisition and Integration Risks .

We have completed eight whole-bank acquisitions since 2011 and regularly review acquisition opportunities.

An acquisition strategy involves substantial risks and uncertainties including:

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Also, if our long-term growth occurs more slowly than anticipated or declines, our operating results could be materially adversely affected.

The merger with WFB and the integration of the businesses may be more difficult, costly or time-consuming than expected, and we may fail to realize the anticipated benefits of the merger.

For example, we recently completed the acquisition of WFB and First National Bank.

The success of the proposed merger will depend in part on our ability to realize anticipated benefits of the proposed merger and on our ability to successfully integrate the businesses.

The anticipated benefits of the proposed merger may not be realized fully, or at all, or may take longer to realize than expected.

For example, WFB’s operations are located in north Texas, which are new markets for us.

We may experience unanticipated difficulties in integrating WFB’s business, including potential losses of customers and employees, higher than expected integration costs, and inability to maintain and increase market share at new locations in new markets.

In addition, we may fail to realize anticipated benefits of the proposed merger, including but not limited to lower than expected revenues and profits, inability to achieve expected cost savings and synergies, or higher than expected liabilities and costs.

Integrating the merger may cause disruptions to our ongoing business and the business of WFB, including difficulties in maintaining relationships with customers, employees or vendors and the diversion of management time on merger-related issues, which could adversely affect our and WFB’s businesses, financial condition and results of operations.

We cannot assure you that we will be able to achieve the expected benefits of the proposed merger with WFB.

Changes in retail distribution strategies and consumer behavior may adversely impact our business, financial condition and results of operations.

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In recent periods, we have focused on enhancing our online banking platform and plan to continue to introduce new technologies, with the goal of delivering products and services more efficiently with fewer branches and people.

We closed four branches during our last three fiscal years .

Two of the branches had been acquired, and the closures involved anticipated synergies that resulted in significant cost savings.

In 2022, we sold five former branch locations and three tracts of land that were being held for future branch locations.

We closed two branches during our last three fiscal years .

One of the branches had been acquired, and the closures involved anticipated synergies that resulted in significant cost savings.

In 2023, we completed the sale of certain assets, deposits and other liabilities associated with two of our Texas branches in order to focus more on our core markets.

Of the Bank’s entire branch network, these two locations were geographically the most distant from our Louisiana headquarters.

We also ceased operation of 14 ATMs in 2023.

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We could incur material losses in the future due to the closure or consolidation of branches or sale of land held for future branch locations.

Our business is concentrated in southern Louisiana, southeast Texas, and Alabama, and an economic downturn affecting these areas may magnify the adverse effects and consequences to us.

Our business is concentrated in southern Louisiana, Texas, and Alabama, and an economic downturn affecting these areas may magnify the adverse effects and consequences to us.

We currently conduct our operations primarily in southern Louisiana, and more specifically, in the Baton Rouge, New Orleans, Lafayette and Lake Charles metropolitan areas, in the greater Houston, Texas area, and in Alabama.

As of December 31, 2024 , our primary markets were south Louisiana (approximately 78% of our total deposits of $2.3 billion), southeast Texas (approximately 6% of our total deposits) and Alabama (approximately 16% of our total deposit s).

As of December 31, 2025 , our primary markets were south Louisiana (approximately 77% of our total deposits of $2.4 billion), Texas (approximately 6% of our total deposits) and Alabama (approximately 17% of our total deposit s).

At December 31, 2025, approximately 64%, 13%, and 4% of t he secured loans in our total loan portfolio were secured by properties and other collateral located in Louisiana, Texas and Alabama, respectively.

This geographic concentration imposes a greater risk to us than to our competitors in the area who maintain significant operations outside of our selected markets.

Accordingly, any regional or local economic downturn, or natural or man-made disaster, that affects southern Louisiana, southeast Texas, Alabama, or existing or prospective property or borrowers in such areas may affect us and our profitability more significantly and more adversely than our more geographically diversified competitors.

Accordingly, any regional or local economic downturn, or natural or man-made disaster, that affects southern Louisiana, Texas, Alabama, or existing or prospective property or borrowers in such areas may affect us and our profitability more significantly and more adversely than our more geographically diversified competitors.

Much of our business development and marketing strategy is directed toward fulfilling the banking and financial services needs of small to medium-sized businesses.

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For example, the energy sector, which is historically cyclical, has experienced significant volatility in oil and gas prices.

While we consider our direct exposure to the energy sector not to be significant, comprising approximate ly 2.1% o f total loans at December 31, 2024, continued oil price volatility could have further negative impacts on general economic conditions, particularly in our south Louisiana and southeast Texas markets, which could have a material adverse effect on our business, financial condition, and results of operations.

While we consider our direct exposure to the energy sector not to be significant, comprising approximate ly 4.7% o f total loans at December 31, 2025, continued oil price volatility could have further negative impacts on general economic conditions, particularly in our south Louisiana and Texas markets, which could have a material adverse effect on our business, financial condition, and results of operations.

We have a significant number of loans secured by real estate, and a downturn in the real estate market could result in losses and negatively impact our profitability.

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Thus, the general business conditions of the local economy and the borrower’s ability to sell its products and services, thereby generating sufficient operating revenue to repay us under the agreed upon terms and conditions, are the chief considerations when assessing the risk of a commercial and industrial loan.

The liquidation of collateral, if any, is considered a secondary source of repayment because equipment and other business assets may, among other things, be obsolete or of limited resale value.

The liquidation of collateral, if any, is considered a secondary source of repayment because equipment and other business assets may, among other things, deteriorate, become obsolete or be of limited resale value.

Additionally, as of December 31, 2025, 62% of our commercial and industrial loans were variable rate loans;

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Our commercial and industrial loans represented 24.6%, 24.8% and 27.4% of total loans as of December 31, 2023, 2024 and 2025, respectively.

The increase from year-end 2022 to year-end 2023 was caused primarily by our purchase of commercial and industrial revolving lines of credit which, at the time of the loan purchase agreement, had an unpaid principal balance of approximately $163 million and total commitments of approximately $238 million, as described in more detail elsewhere in this report.

The acquired loans are to consumer finance lending companies.

Loans to consumer finance lending companies accounted for approximately 8% of our total loans at December 31, 2025.

The repayment of consumer finance loans depends primarily on the creditworthiness and projected cash flow of the borrower (and any guarantors).

Thus, the primary risks associated with these types of loans are the general business conditions of the local economy, and the ability to generate sufficient operating revenue to repay us under the agreed upon terms and conditions.

Loans to consumer finance lending companies accounted for approximately 8% of our total loans at December 31, 2024.

Commercial and industrial loans include public finance loans made to governmental entities, which can be taxable or tax-exempt, for purposes including debt refinancing, economic development, quality of life projects, short-term cash-flow needs, and infrastructure enhancements, among other things.

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As interest rates began to rise significantly during 2022, competition for deposits increased, and the Bank raised rates it offered on deposits to remain competitive in its markets .

During 2023, interest rates continued to rise, and they remained high in 2024.

Customers continued to shift into interest-bearing deposit products, and we utilized more brokered time deposits.

These factors contributed to an increase in our total cost of deposits by 207 basis points from 2022 to 2023 and 89 basis points from 2023 to 2024.

During 2023, interest rates continued to rise, and they remained high in 2024 and 2025.

Customers continued to shift into interest-bearing deposit products, and we continued to utilize brokered time deposits.

These factors contributed to an increase in our total cost of deposits by 89 basis points from 2023 to 2024.

Our cost of deposits decreased by 34 basis points to 3.04% in 2025 , but remained elevated.

Disruptions in the banking industry during the first half of 2023 discussed elsewhere in this report highlighted the speed at which deposits can be moved from bank to bank or outside the banking system, heightening liquidity concerns of traditional banks.

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Competition for employees is intense.

Competition for talent is intense.

We could have difficulty replacing key employees with personnel with the combination of skills and attributes required to execute our business strategies and who have ties to the communities within our market areas.

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Hurricanes or other adverse weather conditions, as well as man-made disasters, could negatively affect our local markets or disrupt our operations, which may adversely affect our business and results of operations.

Our business is concentrated in southern Louisiana, in southeast Texas, and in Alabama.

Our business is concentrated in southern Louisiana, in Texas, and in Alabama.

Our selected markets are susceptible to major hurricanes, floods, tropical storms, tornadoes and other natural disasters and adverse weather, the nature and severity of which can be difficult to predict.

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Our ability to compete successfully to some extent depends on whether we can implement new technologies to provide products and services to our customers more efficiently while avoiding significant operational challenges that increase our costs or delay full implementation, especially relative to our peers, many of which have greater resources to devote to technological improvements.

The development and use of new technologies presents a number of risks and challenges to our business.

The development and use of new technologies present a number of risks and challenges to our business.

For example, we must have or develop in-house capabilities to implement, manage and use the new technologies, or outsource the implementation, management and use of the new technologies to third parties, and develop appropriate internal controls and third-party oversight.

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For example, in 2019, we sold $25.0 million of subordinated notes structured to qualify as Tier 2 capital, and $30.0 million of common stock, in part to fund acquisitions.

In 2025, we issued $32.5 million of our Series A Preferred Stock to support the acquisition of WFB and for general corporate purposes, including organic growth and other potential acquisitions.

If t he Bank’s regulators deemed its capital levels to be too low for safety and soundness reasons or if the Bank were to be designated as “undercapitalized” or in a lower capitalization category than “undercapitalized,” it could be required to raise additional capital.

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Our ability to raise additional capital depends on conditions in the capital markets, economic conditions and a number of other factors, including investor perceptions regarding the banking industry, market conditions and governmental activities, and on our financial condition and performance.

Rising interest rates increased our costs of long-term debt in 2022, 2023, and 2024.

Further increases in interest rates would increase the costs of our variable rate borrowings.

There can be no assurances that we will be able to raise additional capital if needed or on terms acceptable to us.

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We are exposed to many types of operational risks, including, particularly as a financial institution, fraud risks and human error.

Our fraud risks include fraud committed by external parties against the Company or our customers, fraud committed internally by our associates and fraud committed by customers.

Our fraud risks include fraud committed by external parties against us or our customers, fraud committed internally by our associates and fraud committed by customers.

Certain fraud risks, including identity theft and account takeover, may increase as a result of customers’ accounts or personally identifiable information being obtained through breaches of retailers’ or other third parties’ networks.

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Any such adjustments are reflected in our results of operations in the periods in which they become known.

As of December 31, 2024, our goodwill totaled $40.1 million.

As of December 31, 2025, our goodwill totaled $40.1 millio n, and we expect to record additional goodwill in connection with our acquisition of WFB.

While we have not recorded any such impairment charges since we initially recorded the goodwill, there can be no assurance that our future evaluations of goodwill will not result in findings of impairment and related write-downs, which may have a material adverse effect on our financial condition and results of operations.

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Congress that could further substantially increase regulation of the financial services industry, and impose restrictions on our operations and our ability to conduct business consistent with historical practices, which could have a material adverse effect on our business, financial condition, results of operations and growth prospects.

Our efforts to comply with new laws, regulations and standards typically result in increased expenses and a diversion of management time and attention.

Our efforts to comply with new laws, regulations and standards typically result in increased expenses and a diversion of management’s time and attention.

The information under the heading “ Supervision and Regulation ” in Item 1.

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The Department of Justice and other federal agencies enforce these laws and regulations, but private parties may also have the ability to challenge an institution’s performance under fair lending laws in private class action litigation.

If an institution’s performance under the fair lending laws and regulations is found to be deficient, the institution could be subject to damages and civil money penalties, injunctive relief, restrictions on mergers and acquisitions activity, restrictions on expansion, and restrictions on entering new business lines, among other sanctions.

In addition, the OCC’s assessment of our compliance with the CRA is taken into account when evaluating any application we submit for, among other things, approval of the acquisition or establishment of a branch or other deposit facility, an office relocation, a merger or the acquisition of another financial institution.

If an institution’s performance under the fair lending laws and regulations is found to be deficient, the institution could be subject to damages and civil money penalties, injunctive relief, restrictions on mergers and acquisitions, restrictions on expansion, and restrictions on entering new business lines, among other sanctions.

In addition, the OCC’s assessment of our compliance with the CRA is taken into account when evaluating any application we submit for, among other things, approval of the acquisition or establishment of a branch or other deposit facility, an office relocation, a merger with or the acquisition of another financial institution.

Our failure to satisfy our CRA obligations could, at a minimum, result in the denial of such applications and limit our growth.

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We are also subject to increased scrutiny of compliance with the rules enforced by the Office of Foreign Assets Control.

If our policies, procedures and systems are deemed deficient, we would be subject to liability, including fines and regulatory actions, which may include restrictions on our ability to pay dividends and the necessity to obtain regulatory approvals to proceed with certain aspects of our business plan, including our acquisition plans.

Failure to maintain and implement adequate programs to combat money laundering and terrorist financing could also have serious reputational consequences for us.

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Our success depends on our ability to respond to the threats and opportunities of fintech innovation.

Fintech developments, such as bitcoin or other types of cryptocurrency and the development of alternative payment systems such as Venmo and PayPal, have the potential to disrupt the financial industry and change the way banks do business.

Fintech developments, such as stablecoins, bitcoin or other types of cryptocurrency and the development of alternative payment systems such as Venmo and PayPal, have the potential to disrupt the financial industry and change the way banks do business.

Our success depends on our ability to adapt to the pace of the rapidly changing technological environment, which is crucial to retention and acquisition of customers.

On July 31, 2018, the OCC announced it would grant limited-purpose national bank charters to fintech companies that offer bank products and services.

The federal charter would allow fintech companies to operate nationwide under a single set of national standards, without needing to seek state-by-state licenses or joining with brick-and-mortar banks, which could have the effect of allowing fintech companies to more easily compete with us for financial products and services in the communities we serve.

At present, the future of the OCC limited-purpose fintech charter is unclear.

To date, the OCC has not approved any such charters and each application for a charter has been met with a lawsuit challenging the OCC’s authority to issue such charters.

Under the current administration, the OCC has generally been more open and supportive of charter applications in the digital assets space.

For example, in December 2025, the OCC approved five national trust bank charter applications for applicants that will primarily engage in fiduciary activities related to digital assets, and certain related custodial activities.

Several of the charter recipients plan to issue stablecoins.

Additional fintech-related charter applications are pending.

We may be required to pay significantly higher FDIC deposit insurance premiums in the future.

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As of December 31, 2025, we had 9,798,948 shares outstanding and 226,602 shares subject to options granted under our incentive plan.

Our Series A Preferred Stock is also convertible into our common stock.

Because our outstanding shares of common stock either were issued in an offering registered under the Securities Act or have been held for more than one year, such shares are freely tradable, except for shares held by our affiliates (approximately 7% of shares outstanding as of December 31, 2025) and 337,735 shares that represent unvested restricted shares under our incentive plan.

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These provisions may discourage potential acquisition proposals and could delay or prevent a change in control, including circumstances in which our shareholders might otherwise receive a premium over the market price of our shares.

Our issuance of preferred stock could adversely affect holders of our common stock and discourage a takeover.

Our shareholders authorized our Board to issue up to 5,000,000 shares of preferred stock without any further action on the part of our shareholders.

Our Series A Preferred Stock could adversely affect our liquidity, financial condition and holders of our common stock.

On July 1, 2025, we issued 32,500 shares of our newly designated Series A Preferred Stock.

The relative preferences, rights and limitations of our Series A Preferred Stock are set forth in our Restated Articles of Incorporation, as amended by the Articles of Amendment filed with the Louisiana Secretary of State, which became effective on June 30, 2025 (as amended, the “Restated Articles”) .

Pursuant to the Restated Articles, subject to certain exceptions, we are prohibited from paying dividends on, or repurchasing or redeeming our common stock, unless full dividends for the Series A Preferred Stock’s most recently completed dividend period have been declared and paid on all outstanding shares of Series A Preferred Stock.

In addition, holders of our Series A Preferred Stock have the right to receive distributions or payments upon any liquidation, dissolution or winding up of our business, or upon the occurrence of specified “Reorganization Events,” as defined in the Restated Articles, before any payment may be made to holders of our common stock.

These and other provisions related to the Series A Preferred Stock could influence our use of cash, which in turn could reduce the amount of cash flows available for dividends on our common stock, working capital, capital expenditures, growth opportunities (including acquisitions) and general corporate purposes.

Our Series A Preferred Stock could also limit our ability to obtain additional financing, which could have an adverse effect on our financial condition and growth strategies.

Further, holders of Series A Preferred Stock have the right, at any time and from time to time, at such holder’s option to convert all or any portion of their Series A Preferred Stock into shares of our common stock at the rate of 47.619 shares of common stock per share of Series A Preferred Stock (subject to certain adjustments) (the “Conversion Rate”), plus cash in lieu of fractional shares of common stock.

In addition, subject to certain conditions, on or after July 1, 2028, we will have the right, at our option, from time to time on any dividend payment date, to cause some or all of the Series A Preferred Stock to be converted into shares of our common stock at the Conversion Rate if, for 20 trading days within a period of 30 consecutive trading days, the closing price of our common stock exceeds $26.25 per share (subject to certain adjustments).

Any conversion of the Series A Preferred Stock into common stock would dilute the ownership interest of existing holders of our common stock, and any sales in the public market of common stock issuable upon such conversion, or the perception that such sales might occur, could adversely affect prevailing market prices of our common stock.

Our issuance of preferred stock in the future could adversely affect holders of our common stock and discourage a takeover.

Our shareholders authorized our Board to issue up to 5,000,000 shares of “blank check” preferred stock without any further action on the part of our shareholders.

The Board also has the power, without shareholder approval, to set the terms of any series of preferred stock that may be issued, including voting rights, dividend rights, preferences over our common stock with respect to dividends or in the event of a dissolution, liquidation or winding up and other terms.

In the event that we issue preferred stock in the future that has preference over our common stock with respect to payment of dividends or upon our liquidation, dissolution or winding up, or if we issue preferred stock with voting rights that dilute the voting power of our common stock, the rights of the holders of our common stock or the market price of our common stock could be adversely affected.

As of the date of this report, 32,500 shares of our newly designated Series A Preferred Stock are outstanding.

Holders of our Series A Preferred Stock have certain rights and preferences over our common stock, including but not limited to, payment of dividends, payment upon liquidation, dissolution or winding up, and such shares are convertible into shares of our common stock upon the occurrence of certain events, subject to the terms and conditions of such Series A Preferred Stock.

Stockholders’ Equity and “—Our Series A Preferred Stock could adversely affect our liquidity, financial condition and holders of our common stock” above for additional information regarding our Series A Preferred Stock.

If we issue new preferred stock in the future that has preference over our common stock with respect to payment of dividends or upon our liquidation, dissolution or winding up, or if we issue preferred stock with voting rights that dilute the voting power of our common stock or that are convertible into common stock, the rights of the holders of our common stock or the market price of our common stock could be adversely affected.

In addition, the ability of our Board to issue shares of preferred stock without any action on the part of our shareholders may impede a takeover of us and prevent a transaction perceived to be favorable to our shareholders.

4 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors