What was the expected volatility used in the Bojangles Share-Based Compensation Plan's weighted-average valuation assumptions for the years ended December 29, 2024, and December 31, 2023?

According to Bojangles's 2025 Franchise Disclosure Document, the expected volatility used in the weighted-average valuation assumptions for the Share-Based Compensation Plan was 50.0% for both the year ended December 29, 2024, and the year ended December 31, 2023. This percentage reflects Bojangles's estimation of how much its stock price might fluctuate, which is a key input when valuing share-based compensation awards like stock options.

Expected volatility is a critical factor in determining the fair value of share-based awards. A higher expected volatility generally leads to a higher valuation of these awards because it suggests a greater potential for the stock price to increase, benefiting the award holders. Bojangles estimated this volatility based on the average historical volatility of similar entities with publicly traded shares.

For prospective franchisees, understanding these assumptions is important because share-based compensation is a real expense that impacts the company's financial statements. While franchisees may not directly participate in the Share-Based Compensation Plan, the overall financial health and stability of Bojangles, influenced by such compensation, can affect the franchise system. Therefore, knowing that Bojangles uses a consistent volatility estimate helps provide insight into their financial planning and valuation practices.