Ollie's Bargain Outlet Holdings, Inc.OLLI
Ollie's Bargain Outlet Holdings, Inc. Stock Compensation Disclosure
| (9) |
Equity Incentive Plans
|
During 2012, Ollie’s established an equity incentive plan (the “2012 Plan”) under which stock options were granted to executive officers and key
employees as deemed appropriate under the provisions of the 2012 Plan, with an exercise price at the fair value of the underlying stock on the date of grant. The vesting period for options granted under the 2012 Plan is five years (20% ratably per year).
Options granted under the 2012 Plan are subject to employment for vesting, expire 10 years from the date of grant, and are not
transferable other than upon death. As of July 15, 2015, the date of the pricing of the Company’s initial public offering, no additional equity grants will be made under the 2012 Plan.
In connection with its initial public offering, the Company adopted the 2015 equity incentive plan (the “2015 Plan”) pursuant to which the Company’s
Board of Directors may grant stock options, restricted shares or other awards to employees, directors and consultants. The 2015 Plan allows for the issuance of up to 5,250,000 shares. Awards will be made pursuant to agreements and may be subject to vesting and other restrictions as determined by the Board of Directors or the Compensation Committee of the Board. The Company uses
authorized and unissued shares to satisfy share award exercises. As of February 1, 2025, there were 1,684,851 shares available for grant
under the 2015 Plan.
Stock Options
The exercise price for stock options is determined at the fair value of the underlying stock on the date of grant. The vesting period for awards
granted under the 2015 Plan is generally set at four years (25% ratably per year). Awards are subject to employment for vesting, expire 10 years from the date
of grant, and are not transferable other than upon death.
A summary of the Company’s stock option activity and related information follows for 2022, 2023 and 2024:
|
Number
of options
|
Weighted
average
exercise price
|
Weighted
average
remaining
contractual
term (years)
|
Aggregate
intrinsic value
|
|||||||||||||
|
(in thousands, except share and per share amounts)
|
||||||||||||||||
|
Outstanding at January 29, 2022
|
1,109,315
|
$
|
55.30
|
|
|
|||||||||||
|
Granted
|
328,938
|
43.97
|
||||||||||||||
|
Forfeited
|
(110,295
|
)
|
59.60
|
|||||||||||||
|
Exercised
|
(118,707
|
)
|
33.97
|
|||||||||||||
|
Outstanding at January 28, 2023
|
1,209,251
|
53.92
|
||||||||||||||
|
Granted
|
144,630
|
57.91
|
||||||||||||||
|
Forfeited
|
(54,119
|
)
|
62.90
|
|||||||||||||
|
Exercised
|
(180,278
|
)
|
37.09
|
|||||||||||||
|
Outstanding at February 3, 2024
|
1,119,484
|
56.71
|
||||||||||||||
|
Granted
|
126,683
|
75.37
|
||||||||||||||
|
Forfeited
|
(8,645
|
)
|
65.72
|
|||||||||||||
|
Exercised
|
(453,859
|
)
|
52.87
|
|||||||||||||
|
Outstanding at February 1, 2025
|
783,663
|
61.85
|
6.7
|
$
|
38,914
|
|||||||||||
|
Exercisable at February 1, 2025
|
360,488
|
61.82
|
5.4
|
$
|
17,911
|
|||||||||||
The intrinsic value of stock options exercised for 2024, 2023 and 2022 was $19.6 million, $5.8 million and $3.5 million, respectively.
The weighted average grant date fair value per option for options granted during 2024, 2023 and 2022 was $39.27, $29.07, and $20.62, respectively. The fair value of each option award is estimated on the date of grant using the Black-Scholes option-pricing model that used the weighted average assumptions
in the following table:
|
Fiscal Year Ended
|
||||||||||||
|
February 1,
2025
|
February 3,
2024
|
January 28,
2023
|
||||||||||
|
Risk-free
interest rate
|
4.27
|
%
|
3.36
|
%
|
2.63
|
%
|
||||||
|
Expected
dividend yield
|
—
|
—
|
—
|
|||||||||
|
Expected
life
|
6.25 years
|
6.25 years
|
6.25 years
|
|||||||||
|
Expected
volatility
|
47.63
|
%
|
47.16
|
%
|
44.40
|
%
|
||||||
The expected life of stock options is estimated using the “simplified method,” as the Company does not have sufficient historical information to develop reasonable expectations about future exercise patterns and post-vesting employment
termination behavior for its stock option grants. The simplified method is based on the average of the vesting tranches and the contractual life of each grant. For expected volatility, the Company uses its historical information over the expected
life of the option granted to calculate the fair value of option grants. The risk-free interest rate is based on U.S. Treasury notes with a term approximating the expected life of the option.
Restricted Stock Units
Restricted stock units (“RSUs”) are issued at the closing price of the Company’s common stock on the date of grant. RSUs outstanding vest ratably
over four years or cliff vest in
or four years. Awards are subject to employment for vesting and are not transferable other than upon death.
A summary of the Company’s RSU activity and related information for 2022, 2023 and 2024 is as follows:
|
Number
of shares
|
Weighted
average
grant date
fair value
|
|||||||
|
Nonvested balance at January 29, 2022
|
125,483
|
$
|
69.15
|
|||||
|
Granted
|
235,754
|
44.04
|
||||||
|
Forfeited
|
(35,457
|
)
|
51.49
|
|||||
|
Vested
|
(49,502
|
)
|
67.33
|
|||||
|
Nonvested balance at January 28, 2023
|
276,278
|
50.32
|
||||||
|
Granted
|
205,663
|
58.10
|
||||||
|
Forfeited
|
(27,783
|
)
|
53.24
|
|||||
|
Vested
|
(103,354
|
)
|
52.70
|
|||||
|
Nonvested balance at February 3, 2024
|
350,804
|
53.94
|
||||||
|
Granted
|
173,376
|
74.90
|
||||||
|
Forfeited
|
(18,682
|
)
|
61.89
|
|||||
|
Vested
|
(120,376
|
)
|
54.26
|
|||||
|
Nonvested balance at February 1, 2025
|
385,122
|
62.89
|
||||||
Stock-Based Compensation Expense
The compensation cost for stock options and RSUs recorded within SG&A
was $19.4 million, $12.2 million, and $10.0 million for 2024, 2023 and 2022, respectively. In 2024, we recognized an accelerated expense of $5.5 million
related to previously unrecognized compensation expense on the former CEO’s outstanding equity awards in connection with modification of his awards upon transition to Executive Chairman.
As of February 1, 2025, there was $19.3
million of total unrecognized compensation cost related to non-vested stock-based compensation arrangements. That cost is expected to be recognized over a weighted average period of 2.5 years. Compensation costs related to awards are recognized using the straight-line method.
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Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 26, 2025 | Showing above |
| 2023 | Mar 24, 2023 | |
| 2021 | Mar 24, 2021 | |
About Stock Compensation Disclosures
Stock-based compensation disclosures detail the equity awards granted to employees and executives — including stock options, restricted stock units (RSUs), and performance shares — along with the valuation methods and assumptions used to expense them. This section reveals the true cost of talent retention and the alignment between management incentives and shareholder interests.
Key signals: total unrecognized compensation expense and its expected recognition period signal future earnings headwinds from already-granted awards. For stock options, examine Black-Scholes assumptions — expected volatility, risk-free rate, and expected term — as understating any of these reduces reported compensation expense. Compare stock compensation expense as a percentage of revenue against peers to assess dilution cost. Watch vesting schedules for acceleration clauses tied to change-of-control events. Performance-based awards with undemanding targets may indicate weak governance. Add back stock compensation to operating cash flow to calculate a more conservative free cash flow figure.