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EQUITY-BASED COMPENSATION PLANS
 12 Months Ended
Dec. 31, 2025
Share-Based Payment Arrangement [Abstract]  
EQUITY-BASED COMPENSATION PLANS EQUITY-BASED COMPENSATION PLANS
In 2021, the Company adopted the 2021 Omnibus Incentive Plan (the “2021 Plan”), under which awards, including stock options, time-based restricted stock units ("RSUs"), and performance-based restricted stock units ("PSUs") may be granted to employees and non-employee directors. The 2021 Plan authorized 8,850,000 shares of Common Stock to be available for award grants. On December 31, 2025, 1,548,551 shares of Common Stock remained available for future issuance under the 2021 Plan. On June 6, 2023, the Company granted 1,000,000 time-based RSUs and 1,520,000 PSUs to its new President and Chief Executive Officer. These awards were granted outside of the 2021 Plan as employment inducement awards and did not require shareholder approval under the rules of the NYSE or otherwise.
Restricted Stock Awards
RSUs and PSU are collectively referred to as “Restricted Stock Awards”. The Compensation Committee has awarded RSUs to select employees and non-employee directors and has awarded PSUs to select employees. The RSUs vest ratably over one to four years of continued employment. The grant date fair value of a time-based award or a performance-based award without a market condition is equal to the market price of Common Stock on the grant date and is recognized over the requisite service period. The grant date fair value of a performance-based award with a market condition is determined using a Monte Carlo simulation and is recognized over the requisite service period. On December 31, 2025, there was $9,063 of unrecognized compensation cost related to unvested Restricted Stock Awards that is expected to be recognized over a remaining weighted average period of 2.0 years.
The weighted-average grant-date fair value of Restricted Stock Awards granted during the years ended December 31, 2025 and 2024, was $2.88 and $4.06, respectively. The fair value of Restricted Stock Awards vested and converted to shares of Common Stock was $4,986 for the year ended December 31, 2025.
Unvested Restricted Stock Awards
Number of RSAsWeighted Average
Grant Date Fair Value
Balance on December 31, 20244,195,161$3.12 
Granted4,449,5102.88 
Vested(1,658,007)3.27 
Forfeited(601,310)3.05 
Balance on December 31, 20256,385,354$2.91 
Performance-based Restricted Stock Units
The PSUs granted under the 2021 Plan represent shares of Common Stock that are potentially issuable in the future based on a combination of performance and service requirements. On March 21, 2025, the Company granted 812,256 PSUs under the 2021 Plan to key employees with a grant date fair value of $2.53; on March 31, 2025, the Company granted an additional 10,943 PSUs with a grant date fair value of $2.57; on April 21, 2025 the Company granted 27,134 PSUs with a grant date fair value of $1.98; on June 2, 2025 the Company granted 4,145 PSUs with a grant date fair value of $1.93; on August 4, 2025 the Company granted 11,349 PSUs with a grant date fair value of $1.99; on August 12, 2025 the Company granted 433,034 PSUs with a grant date fair value of $3.26; on August 18, 2025 the Company granted 4,159 PSUs with a grant date fair value of $3.54. The PSUs granted to employees were based on salary and include annual net sales and adjusted EBITDA growth targets with threshold and stretch goals. The awards vest ratably over three years, subject to the employee’s continuous employment through the vesting date and the level of performance achieved. The number of PSUs granted reflects the target number able to be earned under a given award. Non-vested PSU compensation expense is based on the most recent performance assumption available and is adjusted as assumptions change. The fair value of a PSU at the grant date is equal to the market price of Common Stock on the grant date. The cost estimates for PSU grants represent initial target awards until the Company can reasonably forecast the financial performance of each PSU award grant. The actual number of shares of Common Stock to be issued at the end of each performance period will range from —% to 150% of the initial target awards.
On August 12, 2025, the Company granted 433,034 PSUs to its President and Chief Executive Officer, which are potentially issuable in the future based on a combination of achievement of a certain stock price metric and service requirements through the expiration date of August 12, 2032. The fair value of $3.26 for this award is determined using a Monte Carlo simulation as of the date of the grant and share-based compensation expense will not be adjusted should the target awards vary from actual awards. The Company's estimates of fair value may be impacted by certain variables including, but not limited to, stock price volatility, the risk-free interest rate, expected dividend yields, and the Company's performance.
The Company's estimates of fair value may be impacted by certain variables including, but not limited to, stock price volatility, the risk-free interest rate, expected dividend yields, and the Company's performance. Expected volatility is based on a size and leverage-adjusted peer volatility estimate since the Company has limited historical volatility. The expected dividend yield is assumed to be zero since the Company has never paid dividends and does not have current plans to pay any dividends. The risk-free interest rate is based on a term-matched zero-coupon risk-free interest rate derived from the Treasury Constant Maturities yield curve on the valuation date.
Stock Options
Stock option grants have an exercise price at least equal to the market value of the underlying Common Stock on the date of grant, have ten-year terms, and vest ratably over three years of continued employment. In general, vested options expire if not exercised within 90 days of termination of service. Compensation expense for stock options is recorded based on straight-line amortization of the grant date
fair value over the requisite service period. As of December 31, 2025, all stock options are vested and there was no additional compensation cost to recognize.
The following table presents a summary of stock option activity for the year ended December 31, 2025:
Number of
Stock Options		Weighted
Average
Exercise Price		Weighted Average
Remaining
Contractual
Term (years)		Aggregate
Intrinsic Value
(in millions)
Options outstanding on December 31, 2024437,268$10.99 
Forfeited0— 
Expired0— 
Options outstanding on December 31, 2025437,268$10.99 5.80$— 
Options exercisable on December 31, 2025437,268$10.99 5.80$— 
Profit Interest Units
The Holley Stockholder authorized an incentive pool of 41,400,000 units of Holley Stockholder that its management had the right to grant to certain employees of the Company. The units, which are designated as Profit Interest Units (“PIU's”), are a special type of limited liability company equity unit that allows the recipient to potentially participate in a future increase in the value of the Company. The PIUs were issued for no consideration and generally provided for vesting over a requisite service period, subject to the recipient remaining an employee of the Company through each vesting date. Compensation expense related to PIUs is recorded based on the grant-date fair value over the requisite service period.
The components of share-based compensation expense, included within selling, general and administrative costs in the consolidated statements of comprehensive income, is as follows:
For the years ended December 31,
20252024
Restricted stock units$4,826 $3,586 
Performance stock units3,288 1,291 
Stock options49 293