Equity Compensation |
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| Equity Compensation | Equity Compensation 2021 Omnibus Incentive Plan
The Company maintains its 2021 Omnibus Incentive Plan (the “Plan”) under which it grants share-based awards to eligible directors, officers, and employees in order to attract, retain, and reward such individuals and strengthen the mutuality of interest between such individuals and the Company’s stockholders. The Plan allows the Company to issue and grant 15,125,000 shares.
The Company measures compensation expense for share-based awards in accordance with ASC Topic 718, Compensation – Stock Compensation (“ASC 718”). During the three month period ended March 29, 2025, the Company granted share-based awards including restricted stock units (“RSUs”) and performance-based restricted stock units (“PSUs”) under the Plan. The grant date fair value of RSUs and PSUs is equal to the closing price of the Company’s common stock on either: (i) the date of grant; or (ii) the previous trading day, depending on the level of administration required. Forfeitures are recognized as they occur, any unvested RSUs, PSUs, or stock options are forfeited upon a “Termination of Service,” as defined in the Plan, or as otherwise provided in the applicable award agreement or determined by the Company’s Compensation Committee of the Board of Directors. In connection with the equity awards, the share-based compensation expense was $4.0 and $1.9 for the three month periods ended March 29, 2025 and March 30, 2024, respectively. The income tax benefit from share-based compensation was $0.7 and $0.4 for the three month periods ended March 29, 2025 and March 30, 2024, respectively.
Restricted Stock Unit Grants
RSUs are subject to a vesting period between and four years. RSU activity for the three month period ended March 29, 2025 is as follows:
Share-based compensation expense for RSUs is recognized straight line over the respective vesting period, reduced for actual forfeitures, and included in general and administrative expense in the accompanying Unaudited Condensed Consolidated Statement of Operations and Comprehensive Income. Total compensation expense related to the above awards was approximately $3.0 and $1.2 for the three month periods ended March 29, 2025 and March 30, 2024, respectively. As of March 29, 2025, there was an aggregate of $21.1 of unrecognized expense related to the RSUs granted, which the Company expects to amortize over a weighted average period of 1.9 years.
Performance-based Restricted Stock Unit Grants
PSU awards are based on the satisfaction of the Company’s three-year cumulative financial targets. The number of PSUs that become earned can range between 0% and 200% of the original target number of PSUs. PSUs are subject to a two-year or three-year performance cliff-vesting period.
PSUs activity for the three month period ended March 29, 2025 is as follows:
(1) This number includes 431,355 performance stock units, which are projecting to payout at 0% due to performance results from previously-granted PSU awards.
Share-based compensation expense for PSUs is recognized straight line over the requisite vesting period, reduced for actual forfeitures, and included in general and administrative expense in the accompanying Unaudited Condensed Consolidated Statement of Operations and Comprehensive Income. Total compensation expense related to the PSUs was approximately $1.0 and $0.5 for the three month periods ended March 29, 2025 and March 30, 2024, respectively. As of March 29, 2025, there was an aggregate of $6.9 of unrecognized expense related to the PSUs granted, which the Company expects to amortize over a weighted average period of 2.0 years.
The above table represents PSUs assuming 100% of target payout at the time of the grant.
The actual payout of the 2023 grants will be in a range of 0% to 200%, depending on financial performance results for the three-year performance period from January 1, 2023, through December 27, 2025. As of March 29, 2025, the Company deemed the estimate of these PSUs to be issued at 0% of target, and have reflected such estimates within the share-based compensation expense.
The actual payout of the 2024 grants will be in a range of 0% to 200%, depending on financial performance results for the three-year performance period from January 1, 2024, through December 26, 2026. As of March 29, 2025, the Company deemed the estimate of these PSUs to be issued at 0% of target, and have reflected such estimates within the share-based compensation expense.
The actual payout of the 2024 “special incentive” grants will be in a range of 0% to 200%, depending on financial performance results for the two-year performance period from December 29, 2024, through January 2, 2027. As of March 29, 2025, the Company deemed the estimate of these PSUs to be issued at 100% of target, and have reflected such estimates within the share-based compensation expense. The actual payout of the 2025 grants will be in a range of 0% to 200%, depending on financial performance results for the three-year performance period from December 29, 2024, through January 1, 2028. As of March 29, 2025, the Company deemed the estimate of these PSUs to be issued at 100% of target, and have reflected such estimates within the share-based compensation expense.
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