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STOCK-BASED COMPENSTION PLANS | 9 Months Ended
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Dec. 31, 2023
Share-Based Payment Arrangement [Abstract] |
STOCK-BASED COMPENSTION PLANS | STOCK-BASED COMPENSATION PLANS Equity Incentive Plans The Barkbox, Inc. 2011 Stock Incentive Plan (as amended from time to time, the “2011 Plan”) provides for the award of stock options and other equity interests in the Company to directors, officers, employees, advisors or consultants of the Company. On June 1, 2021, in connection with the Merger, the 2021 Equity Incentive Plan (the “2021 Plan”) became effective and 16,929,505 authorized shares of common stock were reserved for issuance thereunder. In addition, pursuant to the terms of the Merger Agreement, on the Closing Date of the Merger, options to purchase shares of Legacy BARK’s common stock previously issued under the 2011 Plan were converted into options to purchase an aggregate of 29,390,344 shares of BARK common stock. Beginning on April 1, 2022 and ending on (and including) March 31, 2031, the aggregate number of shares of common stock that may be issued under the 2021 Plan shall increase by a number, determined by the Company’s Board of Directors (the “Board”) on or before May 1st of such fiscal year, not to exceed 5% of the total number of shares of common stock issued and outstanding on the last day of the preceding fiscal year. In April 2023, the Board approved an increase of the aggregate number of common stock that may be issued under the 2021 Plan by 8,876,143 shares. As of December 31, 2023, 17,601,830 shares of common stock were available for the Company to grant under the 2021 Stock Plan; there were no more shares available for grant under the 2011 Plan. Periodically, the Company issues new hire, promotion and other awards under the 2021 Stock Plan and awards may be forfeited resulting in the underlying shares returning to the 2021 Stock Plan. The 2011 and 2021 Plans (together, the “Plans”) are administered by the Company’s Compensation Committee of its Board (the “Compensation Committee”). The exercise prices, vesting and other restrictions are determined by the Board, except that the exercise price per share of a stock option may not be less than 100% of the fair value of the common share on the date of grant. Stock options awarded under the Plans typically expire 10 years after the date of the grant and generally have vesting conditions of 25% on the first anniversary of the date of grant and 75% on a monthly basis at a rate of 1/36th unless otherwise determined by the Compensation Committee. Restricted stock units (“RSU”) awarded under the plan for the purchase of common stock will vest based on continued service which is generally four years. The grant date fair value of the award will be recognized as compensation expense over the requisite service period. The fair value of the RSUs is estimated on the date of grant based on the fair value of the Company’s common stock. The Plans provide that the Compensation Committee shall determine the vesting conditions of awards granted under the Plans, and the Compensation Committee has from time to time approved vesting schedules for certain awards that deviate from the vesting conditions described in the previous sentence. Employee Stock Purchase Plan In June 2021, the 2021 Employee Stock Purchase Plan (the “2021 ESPP”) became effective. The 2021 ESPP authorizes the issuance of shares of common stock pursuant to purchase rights granted to employees. On the first day of each fiscal year commencing on April 1, 2022 and ending on (and including) March 31, 2041, the aggregate number of shares of common stock that may be issued under the ESPP shall increase by a number, determined by the Board on or before May 1st of such fiscal year, not to exceed the lesser of (i) one percent (1%) of the total number of shares of common stock issued and outstanding on the last day of the preceding fiscal year or (ii) 1,500,000 shares of common stock. If the Board does not determine to increase the aggregate number of shares of common stock in the ESPP by May 1st of such fiscal year, such increase shall be zero. In April 2023, the Board approved the authorization of an additional 1,500,000 shares of common stock that may be issued under the 2021 ESPP. A total of 4,885,901 shares of common stock have been reserved for future issuance under the 2021 ESPP. Employees who elect to participate in the ESPP commence payroll withholdings that accumulate through the end of the respective offering period. In accordance with the guidance in ASC 718-50 - Compensation - Stock Compensation, the ability to purchase shares of the Company’s common stock for eighty-five percent (85%) of the lower of the price on the first day of the offering period or the last day of the offering period (i.e. the purchase date) represents an option and, therefore, the ESPP is a compensatory plan under this guidance. Accordingly, share-based compensation expense is determined based on the option’s grant-date fair value as estimated by applying the Black Scholes option-pricing model and is recognized over the withholding period. During the nine months ended December 31, 2023 and 2022, employees who elected to participate in the ESPP purchased a total of 545,133 and 109,186 shares of common stock, respectively, at an average price of $0.90 and $1.32, respectively. ESPP employee payroll contributions accrued as of December 31, 2023 were approximately $0.1 million, and are included within accrued and other current liabilities in the condensed consolidated balance sheet. Cash withheld via employee payroll deductions is presented in financing activities as proceeds from stock purchases under employee stock purchase plan on the consolidated statement of cash flows. Stock Option Activity During the nine months ended December 31, 2023 and 2022, the Company granted to its employees equity awards to purchase an aggregate of 1,120,000 and 1,575,074 shares of common stock, respectively, with a weighted average exercise price of $1.17 and $2.94, respectively, vesting over a four-year period. Restricted Stock Unit (“RSU”) Activity During the nine months ended December 31, 2023 and 2022, the Company granted to its employees RSUs for the purchase of 10,286,820 and 7,428,120 shares of common stock, respectively. In July 2023, the Company approved the Fiscal Year 2024 Management Incentive Program (“2024 Incentive Program”). Under this program, each participant’s award is denominated in shares of common stock and is subject to attainment of BARK’s performance goals as established by the Compensation Committee of the Board for fiscal year 2024. We recorded a stock compensation expense of $0.2 and $0.7 million during the three and nine months ended December 31, 2023, respectively. Market-based Award On April 15, 2022, pursuant to the 2021 Plan, the Company granted its CEO a market condition performance option award for the purchase of up to 600,000 shares of the Company’s common stock. The award had a grant date fair value of approximately $0.7 million using a Monte Carlo simulation model. Options under this market-based award will vest based on achievement of stock price targets of the Company's common stock. The right to purchase 200,000 shares of common stock under the options vests when the stock price meets or exceeds $8.00 per share for 30 consecutive days, the right to purchase 200,000 shares of common stock under the options vest when the stock price meets or exceeds $12.00 per share for 30 consecutive days, and the right to purchase 200,000 shares of common stock under the options vests when the stock price meets or exceeds $16.00 per share for 30 consecutive days. These market-based conditions must be met in order for this option award to vest, and it is therefore possible that no awards would ultimately vest. The Company will recognize compensation expense for this award regardless of whether such conditions are met. The fair value is expensed over the requisite service period. Stock-based Compensation The following table summarizes the total stock-based compensation expense by expense caption and by type of award for the three and nine months ended December 31, 2023 and 2022 (in thousands):
| Three Months Ended |  | Nine Months Ended
| December 31, |  | December 31,
| 2023 |  | 2022 |  | 2023 |  | 2022
Stock-based compensation expense by expense caption |  |  |  |  |  |  |
General and administrative | $ | 3,255 |  |  | $ | 3,354 |  |  | $ | 9,520 |  |  | $ | 10,937 |
Advertising and marketing | 341 |  |  | 327 |  |  | 990 |  |  | 939 |
Total stock-based compensation expense | $ | 3,596 |  |  | $ | 3,681 |  |  | $ | 10,510 |  |  | $ | 11,876 |
Stock-based compensation expense by type of award |  |  |  |  |  |  |
RSUs | $ | 2,379 |  |  | $ | 2,158 |  |  | $ | 6,395 |  |  | $ | 7,045 |
Stock options | 868 |  |  | 1,379 |  |  | 2,965 |  |  | 4,442 |
Management Incentive Program | 231 |  |  | — |  |  | 678 |  |  | — |
Market-based award | 55 |  |  | 105 |  |  | 261 |  |  | 300 |
ESPP | 63 |  |  | 39 |  |  | 211 |  |  | 89 |
| $ | 3,596 |  |  | $ | 3,681 |  |  | $ | 10,510 |  |  | $ | 11,876 |

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