Share-Based Compensation

6 Months Ended

Jul. 30, 2022

Share-Based Compensation

Share-Based Compensation

Note 12  Share-Based Compensation

The Company recognized share-based compensation expense of $4.4 million and $3.0 million during the thirteen weeks and $8.2 million and $5.4 million during the twenty-six weeks ended July 30, 2022 and July 31, 2021, respectively.

The Company had net issuances (repurchases) of 87,947 and (25,408) shares of common stock during the thirteen weeks ended July 30, 2022 and July 31, 2021, respectively, for restricted stock grants, stock performance awards issued to employees and common and restricted stock grants issued to non-employee directors, net of forfeitures and shares withheld to satisfy the tax withholding requirement.  During the twenty-six weeks ended July 30, 2022 and July 31, 2021, the Company had net issuances of 600,455 and 301,860 shares of common stock, respectively, related to share-based plans.

Restricted Stock

The following table summarizes restricted stock activity for the periods ended July 30, 2022 and July 31, 2021:

	Thirteen Weeks Ended				Thirteen Weeks Ended
	July 30, 2022				July 31, 2021
			Weighted-				Weighted-
	Total Number		Average		Total Number		Average
	of Restricted		Grant Date		of Restricted		Grant Date
	Shares		Fair Value		Shares		Fair Value
April 30, 2022	1,622,777	$	17.51	May 1, 2021	1,428,844	$	14.04
Granted	10,470		27.70	Granted	6,410		27.50
Forfeited	(29,250)		17.10	Forfeited	(22,375)		13.51
Vested	(24,795)		21.00	Vested	(32,633)		15.95
July 30, 2022	1,579,202	$	17.53	July 31, 2021	1,380,246	$	14.05

	Twenty-Six Weeks Ended				Twenty-Six Weeks Ended
	July 30, 2022				July 31, 2021
		Weighted-				Weighted-
	Total Number	Average			Total Number	Average
	of Restricted	Grant Date			of Restricted	Grant Date
	Shares		Fair Value		Shares	Fair Value
January 29, 2022	1,390,397	$	14.24	January 30, 2021	1,397,227	$	16.74
Granted	681,670		21.10	Granted	568,916		18.73
Forfeited	(80,216)		14.26	Forfeited	(68,875)		15.45
Vested	(412,649)		12.99	Vested	(517,022)		26.26
July 30, 2022	1,579,202	$	17.53	July 31, 2021	1,380,246	$	14.05

The Company granted 10,470 restricted shares during the thirteen weeks ended July 30, 2022, which have a cliff-vesting term of one year.  Of the 681,670 restricted shares granted during the twenty-six weeks ended July 30, 2022, 671,200 restricted shares have a graded-vesting term of three years, with 50% vesting after two years and 50% after three years, and 10,470 shares have a cliff-vesting term of one year.  Of the 6,410 restricted shares granted during the thirteen weeks ended July 31, 2021, 4,910 shares have a cliff-vesting term of one year and 1,500 shares have a graded-vesting term of three years, with 50% vesting after two years and 50% after three years.  Of the 568,916 restricted shares granted during the twenty-six weeks ended July 31, 2021, 544,006 shares have a graded-vesting term of three years, with 50% vesting after two years and 50% after three years, 20,000 shares have a cliff-vesting term of two years and 4,910 shares have a cliff-vesting term of one year.  Share-based compensation expense for graded-vesting grants is recognized ratably over the respective vesting periods.

Performance Awards

During the twenty-six weeks ended July 30, 2022, the Company granted performance share awards for a targeted 87,750 shares, with a weighted-average grant date fair value of $20.99 in connection with the 2020 performance award.  During the twenty-six weeks ended July 31, 2021, the Company granted performance share awards for a targeted 175,500 shares, with a weighted-average grant date fair value of $18.63.  There were no performance-based share awards granted by the Company during the thirteen weeks ended July 30, 2022 or July 31, 2021.  Vesting of performance-based awards is generally dependent upon the financial performance of the Company and the attainment of certain financial goals during the three-year period following the grant.  At the end of the vesting period, the employee will have earned an amount of shares or units between 0% and 200% of the targeted award, depending on the achievement of the specified financial goals for the service period.  Compensation expense is recognized based on the fair value of the award and the anticipated number of shares or units to be awarded for each tranche in accordance with the vesting schedule of the units over the three-year service period.  

During the twenty-six weeks ended July 30, 2022, the Company granted long-term incentive awards payable in cash for the 2022-2024 performance period, with a target value of $8.3 million and a maximum value of $16.6 million.  During the twenty-six weeks ended July 31, 2021, the Company granted long-term incentive awards payable in cash for the 2021-2023 performance period, with a target value of $6.5 million and a maximum value of $13.0 million.  There were no performance-based share awards granted by the Company during the thirteen weeks ended July 30, 2022 or July 31, 2021.  These awards, which vest after a three-year period, are dependent upon the attainment of certain financial goals of the Company for each of the three years and individual achievement of strategic initiatives over the cumulative period of the award.  The estimated values of the awards, which are reflected within other liabilities on the condensed consolidated balance sheets, are being expensed ratably over the three-year performance period.  

Restricted Stock Units for Non-Employee Directors

Equity-based grants may be made to non-employee directors in the form of restricted stock units ("RSUs") payable in cash or common stock at no cost to the non-employee director.  The RSUs are subject to a vesting requirement (usually one year) and earn dividend equivalents at the same rate as dividends on the Company’s common stock.  The dividend equivalents, which vest immediately, are automatically re-invested in additional RSUs.  Expense related to the initial grant of RSUs is recognized ratably over the vesting period based upon the fair value of the RSUs.  The RSUs payable in cash are remeasured at the end of each period.  Expense for the dividend equivalents is recognized at fair value when the dividend equivalents are granted.  Gains and losses resulting from changes in the fair value of the RSUs payable in cash subsequent to the vesting period and through the settlement date are recognized in the Company’s condensed consolidated statements of earnings.  The Company granted 38,104 and 40,729 RSUs to non-employee directors, including 1,459 and 1,449 for dividend equivalents, during the thirteen weeks ended July 30, 2022 and July 31, 2021, respectively, with weighted-average grant date fair values of $27.66 and $27.48, respectively.  The Company granted 40,011 and 42,441 RSUs to non-employee directors, including 3,366 and 3,161 for dividend equivalents, during the twenty-six weeks ended July 30, 2022 and July 31, 2021, respectively, with weighted-average grant date fair values of $27.33 and $27.21, respectively.