What is the weighted average remaining contractual term in years for the outstanding and expected to vest performance-based RSUs at Budget as of December 31, 2024?
Budget Franchise · 2025 FDDAnswer from 2025 FDD Document
ial cash dividend in December 2023, we granted additional RSUs to our award holders with unvested shares as a dividend equivalent, which has been deferred until, and will not be paid unless, the shares of stock underlying the award vest.
Annual activity related to stock units consisted of (in thousands of shares):
| Number of Shares | Weighted Average Grant Date Fair Value | Weighted Average Remaining Contractual Term (years) | Aggregate In | trinsic Value (lions) | ||
|---|---|---|---|---|---|---|
| Time-based RSUs | 464.97 | |||||
| Outstanding at January 1, 2024 | 290 | • | 161,87 | |||
| Granted (a) | 165 | 109.80 | ||||
| Vested (b) | (123) | 138,07 | ||||
| Forfeited | (26) | 162.88 | ||||
| Outstanding and expected to vest at December 31, 2024 (c) | 306 | $ | 143.25 | 1.3 | $ | 25 |
| Performance-based RSUs | _ | 400.77 | ||||
| Outstanding at January 1, 2024 | 411 | $ | 128.77 |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 79)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, the weighted average remaining contractual term for outstanding and expected to vest performance-based Restricted Stock Units (RSUs) as of December 31, 2024, is 1.4 years. This information is relevant to understanding the vesting schedule of performance-based equity compensation for employees and executives within Budget.
Specifically, this means that, on average, performance-based RSUs that were outstanding and expected to vest at the end of 2024 would fully vest within approximately 1 year and 5 months (1.4 years). This vesting is contingent upon meeting certain performance goals and service conditions as described in the FDD.
For a prospective franchisee, this detail provides insight into Budget's employee compensation structure and the time horizon over which performance-based incentives are realized. While it may not directly impact the franchisee's day-to-day operations, it offers a glimpse into the company's approach to incentivizing its workforce and aligning their interests with the company's performance.