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| Share-Based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| STOCK-BASED COMPENSATION |
NOTE 13: STOCK-BASED COMPENSATION
On June 24, 2020, the Whole Earth Brands, Inc. 2020 Long-Term Incentive Plan (the “Plan”) was approved for the purpose of promoting the long-term financial interests and growth of the Company and its subsidiaries by attracting and retaining management and other personnel and key service providers. On June 8, 2023, the Company’s stockholders’ approved the Amended and Restated Whole Earth Brands, Inc. 2020 Long-Term Incentive Plan (the “Amended 2020 Plan”), which increased the number of shares authorized under the Amended 2020 Plan by 4,000,000 shares. Subsequent to the amendment and restatement, an aggregate of 13,300,000 shares of common stock are authorized for issuance under the Amended 2020 Plan. The Plan provides for the granting of stock options (“SOs”), stock appreciation rights (“SARs”), restricted stock awards (“RSAs”), restricted stock units (“RSUs”), performance shares, performance share units (“PSUs”) and other stock-based awards to officers, employees and non-employee directors of, and certain other service providers to, the Company and its subsidiaries. These awards are settled in shares of the Company’s stock and therefore classified as equity awards.
The RSUs and RSAs are accounted for as equity awards and have a grant-date fair value equal to the fair market value of the underlying stock on the grant date. RSUs granted generally vest ratably on the anniversary of the grant date over a period of to three years, depending on the specific terms of each RSU agreement. The RSAs granted to non-employee board members cliff vest over a service period of approximately 24 months. The Company records compensation expense over the expected vesting period and recognizes forfeitures in the period incurred.
PSU awards generally cliff vest subsequent to the completion of the cumulative three-year performance period, depending on the period specified in each respective PSU agreement. The number of PSUs that ultimately vest depends on the Company’s performance relative to a specified cumulative financial targets established for each grant and are expected to be settled in stock.
Stock-based compensation expense for the years ended December 31, 2023, 2022 and 2021 was $7.0 million, $4.9 million, and $8.7 million, respectively. Stock-based compensation expense for the year ended December 31, 2021 included $0.9 million of expense related to 2021 management bonuses that were settled in stock during the second quarter of 2022. The tax benefit recognized related to stock-based compensation was $0.9 million, $0.4 million and $0.5 million for the years ended December 31, 2023, 2022 and 2021, respectively.
A summary of activity and weighted average fair values related to the RSUs is as follows:
The weighted average grant date fair value per share of RSUs granted during the year was $2.55 in 2023, $5.42 in 2022 and $13.48 in 2021.
The aggregate fair value of RSUs upon vesting during the years ended December 31, 2023, 2022 and 2021 was $4.2 million, $1.5 million and $7.2 million, respectively.
A summary of activity and weighted average fair values related to the RSAs is as follows:
The weighted average grant date fair value per share of RSAs granted during the year was $4.07 in 2023, $6.96 in 2022, and $11.77 in 2021.
The aggregate fair value of RSAs upon vesting during the years ended December 31, 2023 and 2022 was $0.2 million and $0.5 million, respectively. No RSAs vested during the year ended December 31, 2021.
A summary of activity and weighted average fair values related to the PSUs is as follows:
The weighted average grant date fair value per share of PSUs granted during the year was $2.20 in 2023, $7.19 in 2022 and $13.65 in 2021.
As of December 31, 2023, the Company had not yet recognized compensation cost on nonvested awards as follows (in thousands):
The nonvested awards excludes unvested PSUs that are deemed not probable of vesting constituting $4.4 million of unrecognized compensation expense at December 31, 2023.
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