Item 9A. Controls and Procedures
Item 9A.
Controls and Procedures.
The Company’s management has carried out an evaluation, under the supervision and with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, of
the effectiveness of its “disclosure controls and procedures,” as such term is defined in Rule 13a-15(e) promulgated under the Exchange Act. Based on this evaluation, the Company’s Chief Executive Officer and Chief Financial Officer concluded
that, as of the end of the period covered by this Report, the disclosure controls and procedures of the Company were effective.
There have been no significant changes in our internal control over financial reporting during the three months ended December 31, 2023 that have materially affected, or are
reasonably likely to materially affect, our internal control over financial reporting.
The design of any system of controls and procedures is based in part upon certain assumptions about the likelihood of future events. There can be no assurance that any design will
succeed in achieving its stated goals under all potential future conditions, regardless of how remote.
Report of Management on Internal Control over Financial Reporting . The management of the Company is responsible for establishing and maintaining adequate internal control
over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. The internal control process has been designed under our supervision to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of the Company’s financial statements for external reporting purposes in accordance with GAAP.
Management conducted an assessment of the effectiveness of the Company’s internal control over financial reporting as of December 31, 2023, utilizing the framework established in
Internal Control – Integrated Framework 2013, issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”).
Based on this assessment, management has determined that the Company’s internal control over financial reporting as of December 31, 2023 was effective.
Our internal control over financial reporting includes policies and procedures that pertain to the maintenance of records that accurately and fairly reflect, in reasonable detail,
transactions and dispositions of assets and provide reasonable assurances that: (1) transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP; (2) receipts and expenditures are being made only in
accordance with authorizations of management and the directors of the Company; and (3) unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the Company’s financial statements are prevented or
timely detected.
All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable
assurance with respect to financial statement preparation and presentation. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or
that the degree of compliance with the policies or procedures may deteriorate.
This Report does not include an attestation report of the Company’s independent registered public accounting firm regarding internal control over financial reporting. As an
emerging growth company, management’s report was not subject to attestation by the Company’s independent registered public accounting firm in accordance with the JOBS Act.
Item 9B.
Other Information.
During the three months ended December 31, 2023, none of the directors or officers of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading
arrangement,” as each term is defined in Item 408 of Regulation S-K.
On March 15, 2024, the Bank entered into the Amendment (the “Amendment”) to the Steve Crockett Deferred Compensation Plan Adoption Agreement (the “Plan”), dated as of March 6,
2008, as amended by that certain Amendment to the Plan, dated as of December 19, 2014 (the “2014 Amendment”), by and between Mr. Steven B. Crockett, the Chief Financial Officer of the Bank and the Company, and the Bank. The Plan is a nonqualified
deferred compensation arrangement maintained primarily to provide supplemental retirement benefits for Mr. Crockett.
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The Amendment increases the annual normal retirement benefit and the benefit upon a separation of service following a change in control payable to Mr. Crockett to from $50,000 to
$100,000. In addition, the Amendment provides that, in the event of Mr. Crockett’s death, Mr. Crockett’s beneficiary will receive the lump sum amount of the separation from service benefit or disability benefit, as applicable, on the first day of
the second month following Mr. Crockett’s death, provided that Mr. Crockett dies before such payment is made.
The foregoing description of the Amendment is only a summary and is qualified in its entirety by reference to the full text of the Amendment, the Plan, as amended by the 2014
Amendment, and the Nonqualified Deferred Compensation Basic Plan Document, which are attached hereto as Exhibit 10.19, Exhibit 10.18, and Exhibit 10.11, respectively, and incorporated herein by reference.
Item 9C.
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.
Not applicable.
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Part III
Item 10.
Directors, Executive Officers and Corporate Governance.
The information required by this Item is incorporated herein by reference to our Definitive Proxy Statement for the 2024 Annual Meeting of Shareholders to be filed with the
Securities and Exchange Commission within 120 days after our fiscal year end (the “Proxy Statement”).
In accordance with Item 406 of Regulation S-K, we have adopted a Code of Business Conduct and Ethics that applies to Company executives, directors and employees. The Code of
Business Conduct and Ethics is posted on our website at www.spfi.bank under “Governance.” Within the time period required by the SEC, we will post on our website any amendment to the Code of Business Conduct and Ethics and any waiver
applicable to our principal executive officer, principal financial officer, and principal accounting officer or controller.
Item 11.
Executive Compensation.
The information required by this Item is incorporated herein by reference to our Proxy Statement to be filed with the Securities and Exchange Commission within 120 days after our
fiscal year end.
Item 12.
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
The information required by this Item is incorporated herein by reference to our Proxy Statement to be filed with the Securities and Exchange Commission within 120 days after our
fiscal year end.
Item 13.
Certain Relationships and Related Transactions, and Director Independence.
The information required by this Item is incorporated herein by reference to our Proxy Statement to be filed with the Securities and Exchange Commission within 120 days after our
fiscal year end.
Item 14.
Principal Accounting Fees and Services.
The information required by this Item is incorporated herein by reference to our Proxy Statement to be filed with the Securities and Exchange Commission within 120 days after our
fiscal year end.
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Part IV
Item 15.
Exhibits, Financial Statement Schedules.
(1)
The consolidated financial statements, notes thereto and independent auditors’ report thereon, filed as part hereof, are listed in Item 8.
(2)
All financial statement schedules are omitted because they are not required or applicable, or the required information is shown in the consolidated financial statements or the notes thereto.
(3)
Exhibits
Exhibit No.
Description
2.1
Agreement and Plan of Merger by and between South Plains Financial, Inc., SPFI Merger Sub, Inc., City Bank, and West Texas State Bank, dated as of July 25, 2019, (incorporated herein by
reference to Exhibit 2.1 to the Current Report on Form 8-K filed with the SEC on July 25, 2019 (File No. 38895)) (schedules to which have been omitted pursuant to Item 601(b)(2) of Regulation S-K and will be provided to the SEC upon
request).
2.2
Securities Purchase Agreement, dated April 1, 2023, by and among South Plains Financial, Inc., City Bank and Alliant Insurance Services, Inc. (incorporated by reference to Exhibit 2.1 to the
Company’s Current Report on Form 8-K filed with the SEC on April 4, 2023) (File No. 001-38895) (schedules to which have been omitted pursuant to Item 601(b)(2) of Regulation S-K and will be provided to the SEC upon request).
3.1
Amended and Restated Certificate of Formation of South Plains Financial, Inc. (incorporated herein by reference to Exhibit 3.1 to the Registration Statement on Form S-1 of South Plains
Financial, Inc. (Registration No. 333-230851) filed April 29, 2019).
3.2
Second Amended and Restated Bylaws of South Plains Financial, Inc. (incorporated herein by reference to Exhibit 3.1 to the Current Report on Form 8-K filed with the SEC on November 1, 2021
(File No. 001-38895)).
4.1
Specimen common stock certificate of South Plains Financial, Inc. (incorporated herein by reference to Exhibit 4.1 to the Registration Statement on Form S-1 of South Plains Financial, Inc.
(Registration No. 333-230851) filed April 29, 2019).
4.2
Indenture, dated September 29, 2020, by and between South Plains Financial, Inc. and UMB Bank, National Association, as trustee (incorporated herein by reference to Exhibit 4.1 to the
Current Report on Form 8-K filed with the SEC on September 30, 2020 (File No. 001-38895)).
4.3
Form of Fixed to Floating Rate Subordinated Note due September 30, 2030 (included as Exhibit A-2 to the Indenture incorporated herein by reference as Exhibit 4.2 hereto).
10.1
Form of Voting Agreement, dated as of July 25, 2019, by and among South Plains Financial, Inc., West Texas State Bank and the shareholders of West Texas State Bank party thereto
(incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K filed with the SEC on July 25, 2019 (File No. 38895)).
10.2
Form of Director Support Agreement, dated as of July 25, 2019, by and among South Plains Financial, Inc. and each non-employee director of West Texas State Bank (incorporated herein by
reference to Exhibit 10.2 to the Current Report on Form 8-K filed with the SEC on July 25, 2019 (File No. 38895)).
10.3 †
Executive Employment Agreement, dated December 18, 2019, by and between South Plains Financial, Inc., City Bank, and Curtis C. Griffith (incorporated herein by reference to Exhibit 10.1 to
the Current Report on Form 8-K filed with the SEC on December 19, 2019 (File No. 001-38895)).
10.4 †
Executive Employment Agreement, dated March 6, 2019, by and between South Plains Financial, Inc. and Cory T. Newsom (incorporated herein by reference to Exhibit 10.4 to the Registration
Statement on Form S-1/A of South Plains Financial, Inc. (Registration No. 333-230851) filed April 29, 2019).
10.5 †
Amendment No. 1 to Executive Employment Agreement, dated December 15, 2021, by and among City Bank, Curtis C. Griffith and South Plains Financial, Inc. (incorporated herein by reference to
Exhibit 10.1 to the Current Report on Form 8-K filed with the SEC on December 21, 2021 (File No. 001-38895)).
10.6 †
Amendment No. 1 to Executive Employment Agreement, dated December 15, 2021, by and among City Bank, Cory T. Newsom and South Plains Financial, Inc. (incorporated herein by reference to
Exhibit 10.2 to the Current Report on Form 8-K filed with the SEC on December 21, 2021 (File No. 001-38895)).
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10.7 †
South Plains Financial, Inc. 2019 Equity Incentive Plan (incorporated herein by reference to Exhibit 10.1 to the Registration Statement on Form S-1/A of South Plains Financial, Inc.
(Registration No. 333-230851) filed April 29, 2019).
10.8 †
Form of Stock Option Award Agreement under the South Plains Financial, Inc. 2019 Equity Incentive Plan (incorporated herein by reference to Exhibit 10.2 to the Registration Statement on Form
S-1/A of South Plains Financial, Inc. (Registration No. 333-230851) filed April 29, 2019).
10.9 †
Form of Restricted Stock Unit Award Agreement under the South Plains Financial, Inc. 2019 Equity Incentive Plan (incorporated herein by reference to Exhibit 10.3 to the Registration
Statement on Form S-1 of South Plains Financial, Inc. (Registration No. 333-230851) filed April 29, 2019).
10.10 †
Form of Indemnification Agreement (incorporated herein by reference to Exhibit 10.9 to the Registration Statement on Form S-1/A of South Plains Financial, Inc. (Registration No. 333-230851)
filed April 29, 2019).
10.11*
Nonqualified Deferred Compensation Plan Basic Plan Document.
10.12 †
Deferred Compensation Plan Adoption Agreement of Cory T. Newsom (incorporated herein by reference to Exhibit 10.5 to the Registration Statement on Form S-1/A of South Plains Financial, Inc.
(Registration No. 333-230851) filed April 29, 2019).
10.13 †
Joint Beneficiary Designation Agreement of Cory Newsom, effective January 1, 2008 (incorporated herein by reference to Exhibit 10.6 to the Registration Statement on Form S-1/A of South
Plains Financial, Inc. (Registration No. 333-230851) filed April 29, 2019).
10.14 †
Joint Beneficiary Designation Agreement of Cory Newsom, effective April 1, 2014 (incorporated herein by reference to Exhibit 10.7 to the Registration Statement on Form S-1/A of South Plains
Financial, Inc. (Registration No. 333-230851) filed April 29, 2019).
10.15
Board Representation Agreement between South Plains Financial, Inc. and James C. Henry (incorporated herein by reference to Exhibit 10.8 to the Registration Statement on Form S-1/A of South
Plains Financial, Inc. (Registration No. 333-230851) filed April 29, 2019).
10.16
Form of Note Purchase Agreement, dated as of September 29, 2020, by and among South Plains Financial, Inc. and the Purchasers (incorporated herein by reference to Exhibit 10.1 of the Current
Report on Form 8-K filed with the SEC on September 30, 2020 (File No. 001-38895)).
10.17
Form of Registration Rights Agreement, dated as of September 29, 2020, by and among South Plains Financial, Inc. and the Purchasers (incorporated herein by reference to Exhibit 10.2 of the
Current Report on Form 8-K filed with the SEC on September 30, 2020 (File No. 001-38895)).
10.18*
Deferred Compensation Plan Adoption Agreement of Steven Crockett, effective January 1, 2008, as amended effective January 1, 2015.
10.19*
Second Amendment to Steven Crockett Deferred Compensation Plan Adoption Agreement, effective March 15, 2024.
16.1
Letter from Weaver and Tidwell, L.L.P., dated October 26, 2021, to the U.S. Securities and Exchange Commission (incorporated herein by reference to Exhibit 16.1 of the Current Report on form
8-K filed with the SEC on October 26, 2021 (File No. 001-38895)).
16.2
Letter from Weaver and Tidwell, L.L.P., dated March 11, 2022, to the U.S. Securities and Exchange Commission (incorporated herein by reference to Exhibit 16.1 of the Current Report on form
8-K filed with the SEC on March 11, 2022 (File No. 001-38895)).
21.1*
Subsidiaries of South Plains Financial, Inc.
23.1*
Consent of FORVIS.
23.2*
Consent of Weaver and Tidwell, LLP.
31.1*
Certification by Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended.
31.2*
Certification by Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended.
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32.1**
Section 1350 Certification of Chief Executive Officer.
32.2**
Section 1350 Certification of Chief Financial Officer.
97.0*
South Plains Financial, Inc. Incentive Award Recoupment Policy.
101.INS*
Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document).
101.SCH*
Inline XBRL Taxonomy Extension Schema Document.
101.CAL*
Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF*
Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB*
Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE*
Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104*
Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101).
*
Filed with this Annual Report on Form 10-K.
**
Furnished with this Annual Report on Form 10-K.
†
Indicates a management contract or compensatory plan.
Item 16.
Form 10-K Summary
None.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized .
South Plains Financial, Inc.
Date: March 15, 2024
By:
/s/ Curtis C. Griffith
Curtis C. Griffith
Chairman and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant in the capacities and on the dates
indicated.
Signature
Title
Date
/s/ Curtis C. Griffith
Curtis C. Griffith
Director (Chairman); Chief Executive Officer (principal executive officer)
March 15, 2024
/s/ Cory T. Newsom
Cory T. Newsom
Director and President
March 15, 2024
/s/ Steven B. Crockett
Steven B. Crockett
Chief Financial Officer and Treasurer (principal financial and accounting officer)
March 15, 2024
/s/ Richard D. Campbell
Richard D. Campbell
Director
March 15, 2024
/s/ Noe G. Valles
Noe G. Valles
Director
March 15, 2024
/s/ Kyle R. Wargo
Kyle R. Wargo
Director
March 15, 2024
/s/ LaDana R. Washburn
LaDana R. Washburn
Director
March 15, 2024
111