What was the fair value of Benihana options that vested in the year ended December 31, 2021?
Benihana Franchise · 2024 FDDAnswer from 2024 FDD Document
| Shares | Weighted average exercise price | Weighted average remaining contractual life | Intrinsic value (thousands) | ||
|---|---|---|---|---|---|
| Outstanding at January 1, 2021 | 1,707,008 | $ 3.37 | |||
| Vested | 594,402 | 3.09 | |||
| Exercised | (1,039,058) | 3.23 | |||
| Cancelled, expired or forfeited | (10,000) | 2.13 | |||
| Outstanding at December | 1,252,352 | 3.36 | 3.92 years | $ | 11,581 |
| 31, | |||||
| 2021 | |||||
| Exercisable at December | 1,126,685 | 3.48 | 3.72 years | $ | 10,283 |
| 31, | |||||
| 2021 | |||||
| Vested | - | - | |||
| Exercised | (65,000) | 2.13 | |||
| Cancelled, expired or forfeited | - | - | |||
| Outstanding at December | 1,187,352 | 3.43 | 2.84 years | $ | 3,811 |
| 31, | |||||
| 2022 | |||||
| Exercisable at December | 1,187,352 | $ 3.43 | 2.84 years | $ | 3,811 |
| 31, | |||||
| 2022 |
There were no stock options granted in 2022 or 2021.
A summary of the status of the Company's non-vested stock options as of December 31, 2022 and 2021 and changes during the years then ended, is presented below:
| | Shares | Weighted average grant date fair value |
Source: Item 22 — CONTRACTS (FDD pages 73–74)
What This Means (2024 FDD)
According to Benihana's 2024 Franchise Disclosure Document, the fair value of options that vested in the year ended December 31, 2021, was $0.1 million. This figure represents the estimated value of stock options that employees or executives earned and became entitled to during that fiscal year.
For a prospective Benihana franchisee, understanding these figures is crucial for assessing the overall financial health and compensation structure of the company. While franchisees themselves may not directly participate in these stock option plans, the value and vesting of these options can reflect the company's performance and its approach to incentivizing its leadership and employees.
It's important to note that this valuation is based on specific accounting methods and assumptions, which may include factors like the stock's market value, volatility, and other relevant financial metrics. The actual value realized by the individuals holding these options can vary depending on the future performance of the company's stock and the terms of the option agreements. Therefore, while the FDD provides this historical data, prospective franchisees should consider it as part of a broader due diligence process to evaluate the financial stability and management practices of Benihana.