How many service options were granted for Batteries Plus Bulbs in 2023?
Batteries_Plus_Bulbs Franchise · 2025 FDDAnswer from 2025 FDD Document
TION PLAN**
BPB has adopted a stock-based compensation plan for employees. BPB reserves shares of common stock to provide for the exercise of stock options and the issuance of common stock under certain incentive compensation awards. BPB recognizes compensation cost on a straight-line basis over the vesting period for the stock compensation awards issued. BPB allocates compensation expense to the Company to the extent company employees are receiving the awards.
BPB formed the 2016 Equity Incentive Plan (2016 Plan) to provide certain management and key employees with incentive-based awards. The 2016 Plan provides options which are dependent on certain service and performance-based conditions, as follows:
Performance-Based Options - If the eligible employee remains continuously employed by Batteries Plus throughout the defined service period, a performance-based target of a pre-determined amount of value is achieved, and an event occurs that includes a distribution of cash to the majority shareholder at a pre-determined amount, then the options will vest and become exercisable with respect to 20% per year of the total number of performance target options held by the eligible employee over a fiveyear period.
Service-Based Options - If the eligible employee remains continuously employed by Batteries Plus over their defined service period, then this option will vest annually with respect to 20% of the service-based options held by the employee.
The fair value of each stock option grant was determined using the Black-Scholes options-pricing model in the year of the grant. As of December 31, 2023 and 2022, total unrecognized compensation cost related to non-vested service options granted under the 2016 Plan was $2,800 and $68, respectively, wh
Source: Item 21 — Financial Statements (FDD pages 79–80)
What This Means (2025 FDD)
According to Batteries Plus Bulbs' 2025 Franchise Disclosure Document, the company utilizes two types of stock option plans, performance-based and service-based, to provide incentive-based awards to certain management and key employees. The vesting of these options depends on specific conditions related to continuous employment and the achievement of performance targets. For service-based options, if an eligible employee remains continuously employed by Batteries Plus Bulbs over their defined service period, the option vests annually with respect to 20% of the service-based options held by the employee.
The fair value of each stock option grant is determined using the Black-Scholes options-pricing model in the year of the grant. As of December 31, 2023, the total unrecognized compensation cost related to non-vested service options granted under the 2016 Plan was $2,800,000, which is expected to be recognized over a weighted-average period of approximately 58 months.
As of December 31, 2023, there were approximately 100,810 performance-based options outstanding under the 2016 Plan, which vest upon the achievement of a realization value. Because this value had not been achieved and management was not certain that it was probable as of December 31, 2023, no expense has been recognized for those awards. The document does not specify the exact number of service-based options granted in 2023, but it does provide the total unrecognized compensation cost and the number of outstanding performance-based options.