Note 12 - Stock Incentive Plans

12 Months Ended

Jan. 30, 2021

Notes to Financial Statements

Share-based Payment Arrangement [Text Block]

(12) Stock Incentive Plans

In 2004, the Company adopted the Build-A-Bear Workshop, Inc. 2004 Stock Incentive Plan which the Company amended and restated in 2009 and 2014 (collectively, the Incentive Plans). In 2017, the Company adopted the Build-A-Bear Workshop, Inc 2017 Omnibus Incentive Plan

On  April 14, 2020, the Board of Directors (the “Board”) of Build-A-Bear Workshop, Inc. (the “Company”) adopted, subject to stockholder approval, the Build-A-Bear Workshop, Inc. 2020 Omnibus Incentive Plan (the “2020 Incentive Plan”). On  June 11, 2020, at the Company’s 2020 Annual Meeting of Stockholders (the “Annual Meeting”), the Company’s stockholders approved the 2020 Incentive Plan. The 2020 Incentive Plan, which is administered by the Compensation and Development Committee of the Board, permits the grant of stock options (including both incentive and non-qualified stock options), stock appreciation rights, other stock-based awards, including restricted stock and restricted stock units, cash-based awards, and performance awards pursuant to the terms of the 2020 Incentive Plan. The 2020 Incentive Plan will terminate on  April 14, 2030, unless earlier terminated by the Board. The number of shares of the Company’s common stock authorized for issuance under the 2020 Incentive Plan is 1,000,000, plus shares of stock that remained available for issuance under the Build-A-Bear Workshop, Inc. 2017 Omnibus Incentive Plan (the “2017 Incentive Plan”) at the time the 2020 Incentive Plan was approved by the Company’s stockholders, and shares that are subject to outstanding awards made under the 2017 Incentive Plan that on or after  April 14, 2020  may be forfeited, expire or be settled for cash.

(a) Stock Options

The following table is a summary of the balance and activity for the Plans related to stock options for the periods presented:

	Options
	Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term		Aggregate Intrinsic Value (in thousands)
Outstanding, February 1, 2020		923,254			9.76
Granted		-			-
Exercised		-			-
Expired		(117,553	)		8.39
Outstanding, January 30, 2021		805,701		$	9.96		3.2	$	-
Options Exercisable as of:
January 30, 2021		805,690		$	9.96		3.2	$	-

There were no options granted during fiscal 2020 or 2019. The expense recorded related to options granted in fiscal 2018 and prior were determined using the Black-Scholes option pricing model and the provisions of SAB 107 and 110, which allow the use of a simplified method to estimate the expected term of “plain vanilla” options.

The total grant date fair value of options exercised in both fiscal 2020 and 2019 was less than $0.1 million in each year. The total intrinsic value of options exercised in both fiscal 2020 and 2019 was less than $0.1 million in each year. The Company generally issues new shares to satisfy option exercises. 

Future total shares available for option, non-vested stock and restricted stock grants were 568,523 and 366,109 at the end of 2020 and 2019, respectively.

(b) Restricted Stock

The Company granted restricted stock awards that vest over a one to three-year period. Recipients of time-based restricted stock awards have the right to vote and receive dividends as to all unvested shares. Recipients of performance-based restricted stock awards have the right to vote and receive dividends upon satisfaction of the performance criteria and certain of these awards’ dividend rights are also subject to time-based vesting. The following table is a summary of the balance and activity for the Plans related to unvested time-based and performance-based restricted stock granted as compensation to employees and directors for the periods presented:

	Time-Based Restricted Stock					Performance-Based Restricted Stock
	Shares			Weighted Average Grant Date Fair Value		Shares			Weighted Average Grant Date Fair Value
Outstanding, February 1, 2020		453,403		$	6.71		262,964		$	7.59
Granted		767,390			2.45		157,374			2.78
Vested		(260,317	)		6.98		(56,380	)		8.85
Forfeited		(29,304	)		2.32		(27,517	)		8.85
Outstanding, January 30, 2021		931,172		$	3.26		336,441		$	5.03

In fiscal 2020, the Company awarded three-year performance-based restricted stock subject to the achievement liquidity, profitability and strategic performance objectives for fiscal 2020, 2021, and 2022. The target number of shares awarded was 157,374 with a weighted average grant date fair value of $2.78 per share. This performance-based restricted stock award had a payout opportunity ranging from 25% to 183.3% of the target number of shares. Based on the Company’s achievement of liquidity and strategic performance goals in fiscal 2020, the Company currently estimates the minimum number of shares that will be earned is approximately 78,703, assuming no forfeitures. The Company is currently unable to estimate the total number of these shares expected to be earned.

In fiscal 2019, the Company awarded three-year performance-based restricted stock subject to the achievement of pre-established consolidated pre-tax income growth objectives for fiscal 2019, 2020, and 2021 and cumulatively across the same three fiscal years. The target number of shares awarded was 95,811 with a weighted average grant date fair value of $5.61 per share. This performance-based restricted stock award had a payout opportunity ranging from 25% to 200% of the target number of shares. Based on the Company’s significant pre-tax loss in fiscal 2020, the Company currently estimates that none of these shares will be earned.

In fiscal 2018, the Company awarded three-year performance-based restricted stock subject to the achievement of pre-established consolidated pre-tax income growth objectives for fiscal 2018, 2019 and 2020. The target number of these shares awarded was 62,500 with a weighted average grant date fair value of $8.60 per share. In addition, the Company awarded three-year performance-based restricted stock subject to the achievement of pre-established consolidated revenue growth objectives for fiscal 2018, 2019 and 2020. The target number of these shares awarded was 20,756 with a weighted average grant date fair value of $8.60 per share. Both of these performance-based restricted stock awards had a payout opportunity ranging from 25% to 200% of the target number of shares. Based on the Company’s financial results for fiscal 2018, 2019 and 2020, the number of shares expected to be earned as part of the pre-tax income growth objective is 32,521, assuming no forfeitures. Based on the Company's financial results for fiscal 2018, 2019 and 2020, no shares were earned as part of the consolidated revenue growth objective.

The vesting date fair value of shares that vested in fiscal 2020 and 2019 was $2.3 million and $2.1 million, respectively.