10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended April 28, 2018

or

☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number: 001-37849

AT HOME GROUP INC.

(Exact name of registrant as specified in its charter)

Delaware	45-3229563
(State of other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

1600 East Plano Parkway Plano, Texas	75074
(Address of principal executive offices)	(Zip Code)

(972) 265-6227

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  ☒ Yes  ☐ No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  ☒ Yes  ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☒	Non-accelerated filer	☐
Smaller reporting company	☐	Emerging growth company	☒	(Do not check if a smaller reporting company)

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☒

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  ☐ Yes  ☒ No

There were 62,849,640 shares of the registrant’s common stock, par value $0.01 per share, outstanding as of June 4, 2018.

AT HOME GROUP INC.

TABLE OF CONTENTS

		Page
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS		1
PART I — FINANCIAL INFORMATION
Item 1.	Condensed Consolidated Financial Statements.	3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	15
Item 3.	Quantitative and Qualitative Disclosures about Market Risk.	29
Item 4.	Controls and Procedures.	29
PART II — OTHER INFORMATION
Item 1.	Legal Proceedings.	31
Item 1A.	Risk Factors.	31
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	31
Item 3.	Defaults Upon Senior Securities.	31
Item 4.	Mine Safety Disclosures.	31
Item 5.	Other Information.	31
Item 6.	Exhibits.	34

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. You can generally identify forward-looking statements by our use of forward-looking terminology such as “anticipate”, “believe”, “continue”, “could”, “estimate”, “expect”, “intend”, “may”, “might”, “plan”, “potential”, “predict”, “seek”, “should” or “vision”, or the negative thereof or other variations thereon or comparable terminology. In particular, statements about the markets in which we operate, our expected new store openings, our real estate strategy, growth targets and potential growth opportunities and future capital expenditures, estimates of expenses we may incur in connection with equity incentive awards to management, and our expectations, beliefs, plans, strategies, objectives, prospects, assumptions or future events or performance contained in this report are forward-looking statements.

We have based these forward-looking statements on our current expectations, assumptions, estimates and projections. While we believe these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, including the important factors described in “Item 1A. Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended January 27, 2018 as filed with the Securities and Exchange Commission (“SEC”) on March 23, 2018, many of which are beyond our control. These and other important factors may cause our actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements. Some of the factors that could cause actual results to differ materially from those expressed or implied by the forward-looking statements include:

· general economic factors that may materially adversely affect our business, revenue and profitability;

· volatility or disruption in the financial markets;

· consumer spending on home décor products which could decrease or be displaced by spending on other activities;

· our ability to successfully implement our growth strategy on a timely basis or at all;

· our failure to manage inventory effectively and our inability to satisfy changing consumer demands and preferences;

· losses of, or disruptions in, or our inability to efficiently operate our distribution network;

· risks related to our imported merchandise;

· adverse events, including weather impacts, in the geographical regions in which we operate;

· risks associated with leasing substantial amounts of space;

· risks associated with our sale-leaseback strategy;

· the highly competitive retail environment in which we operate;

· risks related to our substantial indebtedness and the significant operating and financial restrictions imposed on us and our subsidiaries by our secured credit facilities;

· our dependence upon the services of our management team and our buyers;

· the failure to attract and retain quality employees;

· difficulties with our vendors;

· the seasonality of our business;

· fluctuations in our quarterly operating results;

· the failure or inability to protect our intellectual property rights;

· risks associated with third-party claims that we infringe upon their intellectual property rights;

· increases in commodity prices and supply chain costs;

· the need to make significant investments in advertising, marketing or promotions;

· the success of any investment in online services or e-commerce activities that we may launch;

· the success of our loyalty program or private label or co-branded consumer credit offerings and any investments related thereto;

· disruptions to our information systems or our failure to adequately support, maintain and upgrade those systems;

· unauthorized disclosure of sensitive or confidential customer information;

· regulatory or litigation developments;

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· risks associated with product recalls and/or product liability, as well as changes in product safety and other consumer protection laws;

· inadequacy of our insurance coverage;

· our substantial dependence upon our reputation and positive perceptions of At Home;

· the potential negative impact of changes to our accounting policies, rules and regulations;

· changes to the U.S. tax laws and changes in our effective tax rate;

· our control by an investment group led by certain affiliates of AEA Investors LP and Starr Investment Holdings, LLC (collectively, the “Sponsors”); and

· other risks and uncertainties, including those listed under “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended January 27, 2018 as filed with the SEC on March 23, 2018, and in other filings we may make from time to time with the SEC.

Given these risks and uncertainties, you are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements contained in this report are not guarantees of future performance and our actual results of operations, financial condition and liquidity, and the development of the industry in which we operate, may differ materially from the forward-looking statements contained in this report. In addition, even if our results of operations, financial condition and liquidity, and events in the industry in which we operate, are consistent with the forward-looking statements contained in this report, they may not be predictive of results or developments in future periods.

Any forward-looking statement that we make in this Quarterly Report on Form 10-Q speaks only as of the date of such statement. Except as required by law, we do not undertake any obligation to update or revise, or to publicly announce any update or revision to, any of the forward-looking statements, whether as a result of new information, future events or otherwise, after the date of this report.

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PART I — FINANCIAL INFORMATION

ITEM 1. — CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AT HOME GROUP INC.

Condensed Consolidated Balance Sheets

(in thousands, except share and per share data)

(Unaudited)

	April 28, 2018		January 27, 2018		April 29, 2017
Assets
Current assets:
Cash and cash equivalents	$	13,532	$	8,525	$	10,576
Inventories, net		283,107		269,844		252,116
Prepaid expenses		9,239		7,911		6,939
Other current assets		9,234		14,653		5,216
Total current assets		315,112		300,933		274,847
Property and equipment, net		528,710		466,263		375,541
Goodwill		569,732		569,732		569,732
Trade name		1,458		1,458		1,458
Debt issuance costs, net		1,868		1,978		1,081
Restricted cash		2,515		—		564
Noncurrent deferred tax asset		39,277		33,561		40,516
Other assets		736		316		407
Total assets	$	1,459,408	$	1,374,241	$	1,264,146
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable	$	76,194	$	79,628	$	63,687
Accrued and other current liabilities		92,758		89,499		73,095
Revolving line of credit		183,500		162,000		126,800
Current portion of deferred rent		10,512		9,072		7,291
Current portion of long-term debt and financing obligations		3,600		3,474		3,664
Income taxes payable		1,583		—		13,442
Total current liabilities		368,147		343,673		287,979
Long-term debt		289,397		289,902		299,403
Financing obligations		28,152		19,690		19,882
Deferred rent		147,605		124,054		105,959
Other long-term liabilities		5,508		6,043		2,715
Total liabilities		838,809		783,362		715,938
Shareholders' Equity
Common stock; $0.01 par value; 500,000,000 shares authorized; 62,354,101,  61,423,398 and 60,366,768 shares issued and outstanding, respectively		624		614		604
Additional paid-in capital		583,837		572,488		551,590
Retained earnings (accumulated deficit)		36,138		17,777		(3,986)
Total shareholders' equity		620,599		590,879		548,208
Total liabilities and shareholders' equity	$	1,459,408	$	1,374,241	$	1,264,146

See Notes to Condensed Consolidated Financial Statements.

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AT HOME GROUP INC.

Condensed Consolidated Statements of Income

(in thousands, except share and per share data)

(Unaudited)

	Thirteen Weeks Ended
	April 28, 2018		April 29, 2017
Net sales	$	256,161	$	211,841
Cost of sales		170,917		139,963
Gross profit		85,244		71,878
Operating expenses
Selling, general and administrative expenses		59,465		49,141
Depreciation and amortization		1,579		1,418
Total operating expenses		61,044		50,559
Operating income		24,200		21,319
Interest expense, net		5,778		4,886
Income before income taxes		18,422		16,433
Income tax provision		61		6,384
Net income	$	18,361	$	10,049
Earnings per share:
Net income per common share:
Basic	$	0.30	$	0.17
Diluted	$	0.28	$	0.16
Weighted average shares outstanding:
Basic		61,758,330		60,366,768
Diluted		65,889,163		62,265,248

See Notes to Condensed Consolidated Financial Statements.

4

AT HOME GROUP INC.

Condensed Consolidated Statements of Cash Flows

(in thousands)

(Unaudited)

	Thirteen Weeks Ended
	April 28, 2018		April 29, 2017
Operating Activities
Net income	$	18,361	$	10,049
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		11,456		10,836
Loss (gain) on disposal of fixed assets		31		(18)
Non-cash interest expense		501		465
Amortization of deferred gain on sale-leaseback		(1,978)		(1,468)
Deferred income taxes		(5,716)		219
Stock-based compensation		2,128		3,289
Changes in operating assets and liabilities
Inventories		(13,264)		(8,321)
Prepaid expenses and other current assets		4,091		(3,088)
Other assets		(420)		142
Accounts payable		(5,263)		3,335
Accrued liabilities		(9,117)		(4,711)
Income taxes payable		1,583		6,177
Deferred rent		4,315		3,944
Net cash provided by operating activities		6,708		20,850
Investing Activities
Purchase of property and equipment		(78,587)		(40,897)
Net proceeds from sale of property and equipment		49,637		18
Net cash used in investing activities		(28,950)		(40,879)
Financing Activities
Payments under lines of credit		(131,000)		(74,476)
Proceeds from lines of credit		152,500		99,701
Payments on financing obligations		(139)		(34)
Payments on long-term debt		(828)		(1,596)
Proceeds from exercise of stock options		9,231		—
Net cash provided by financing activities		29,764		23,595
Increase in cash, cash equivalents and restricted cash		7,522		3,566
Cash, cash equivalents and restricted cash, beginning of period		8,525		7,574
Cash, cash equivalents and restricted cash, end of period	$	16,047	$	11,140
Supplemental Cash Flow Information
Cash paid for interest	$	5,033	$	7,902
Cash (received) paid for income taxes	$	(160)	$	191
Supplemental Information for Non-cash Investing and Financing Activities
Increase in current liabilities of property and equipment	$	13,670	$	4,123
Property and equipment reduction due to sale leaseback	$	(26,982)	$	—
Property and equipment acquired under capital lease	$	—	$	1,000
Property and equipment additions due to build-to-suit lease transactions	$	8,660	$	—

See Notes to Condensed Consolidated Financial Statements.

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1.    Summary of Significant Accounting Policies

Basis of Presentation

These condensed consolidated financial statements include At Home Group Inc. and its wholly-owned subsidiaries (collectively referred to as “we”, “us”, “our” and the “Company”).

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information in accordance with Article 10 of Regulation S-X. In the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of the results of operations, financial position and cash flows for the periods presented have been included.

The condensed consolidated balance sheets as of April 28, 2018 and April 29, 2017, the condensed consolidated statements of income for the thirteen weeks ended April 28, 2018 and April 29, 2017 and the condensed consolidated statements of cash flows for the thirteen weeks ended April 28, 2018 and April 29, 2017 have been prepared by the Company and are unaudited. The consolidated balance sheet as of January 27, 2018 has been derived from the audited financial statements for the fiscal year then ended included in our Annual Report on Form 10-K for the fiscal year ended January 27, 2018 as filed with the Securities and Exchange Commission (“SEC”) on March 23, 2018 (the “Annual Report”), but does not include all of the information and notes required by GAAP for complete financial statements. These interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements as of and for the fiscal years ended January 27, 2018 and January 28, 2017 and the related notes thereto included in the Annual Report.

The Company does not have any components of other comprehensive income recorded within its condensed consolidated financial statements, and, therefore, does not separately present a statement of comprehensive income in its condensed consolidated financial statements.

Fiscal Year

We report on the basis of a 52- or 53-week fiscal year, which ends on the last Saturday in January. References to a fiscal year mean the year in which that fiscal year ends. References herein to “first fiscal quarter 2019” relate to the thirteen weeks ended April 28, 2018 and references to “first fiscal quarter 2018” relate to the thirteen weeks ended April 29, 2017.

Consolidation

The accompanying condensed consolidated financial statements include the accounts of At Home Group Inc. and its consolidated wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of these condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of sales and expenses during the reporting period. Actual results could differ from those estimates.

Reclassification

Certain prior period amounts have been reclassified to conform with the current period presentation within the condensed consolidated financial statements and the accompanying notes.

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Seasonality

Our business is moderately seasonal in nature and, therefore, the results of operations for the thirteen weeks ended April 28, 2018 are not necessarily indicative of the operating results that may be expected for a full fiscal year. Historically, our business has realized a slightly higher portion of net sales and operating income in the second and fourth fiscal quarters attributable primarily to the impact of summer and the year-end holiday decorating seasons, respectively.

Restricted Cash

Restricted cash consists of cash and cash equivalents reserved for a specific purpose that is not readily available for immediate or general business use. Our restricted cash balance as of April 28, 2018 consists primarily of cash equivalents held for use in the purchase of property and equipment.

Recent Accounting Pronouncements

In February 2016, the FASB issued ASU No. 2016-02 “Leases”, which supersedes ASC 840 “Leases” and creates a new topic, ASC 842 “Leases” (“ASU 2016-02”). Under ASU 2016-02, an entity will be required to recognize right-of-use assets and lease liabilities on its balance sheet and disclose key information about leasing arrangements. ASU 2016-02 offers specific accounting guidance for a lessee, a lessor and sale and leaseback transactions. Lessees and lessors are required to disclose qualitative and quantitative information about leasing arrangements to enable a user of the financial statements to assess the amount, timing and uncertainty of cash flows arising from leases. ASU 2016-02 is effective for annual reporting periods beginning after December 15, 2018, including interim periods within that reporting period, with early adoption permitted. At adoption, this update will be applied using a modified retrospective approach. We are currently evaluating the impact of ASU 2016-02 and we expect that upon adoption we will recognize right-of-use assets and liabilities that will be material to our financial statements.

In January 2017, the FASB issued ASU No. 2017-04, “Simplifying the Test for Goodwill Impairment” (“ASU 2017-04”). ASU 2017-04 simplifies the measurement of goodwill impairment by removing the second step of the goodwill impairment test, which requires the determination of the fair value of individual assets and liabilities of a reporting unit. Under ASU 2017-04, goodwill impairment is to be measured as the amount by which a reporting unit’s carrying value exceeds its fair value with the loss recognized not to exceed the total amount of goodwill allocated to the reporting unit. ASU 2017-04 is effective for fiscal years beginning after December 15, 2019, with early adoption permitted for interim or annual goodwill impairment tests performed after January 1, 2017. The standard is to be applied on a prospective basis. We are currently evaluating the impact of ASU 2017-04 and do not anticipate a material impact to the consolidated financial statements once implemented.

Recently Adopted Accounting Standards

On January 28, 2018, we adopted ASU No. 2014-09, “Revenue from Contracts with Customers” (“ASU 2014-09”) and ASU No. 2016-04, “Recognition of Breakage for Certain Prepaid Stored-Value Products” (“ASU 2016-04” and together with ASU 2014-09, the “New Revenue Standard” or “ASC 606”) using the full retrospective method. For more information, see Note 2 – Revenue Recognition.

On January 28, 2018, we adopted ASU No. 2016-18, “Restricted Cash” (“ASU 2016-18”) using the required retrospective transition method.  This ASU requires companies to include amounts generally described as restricted cash and restricted cash equivalents in cash and cash equivalents when reconciling beginning-of-period and end-of-period total amounts shown on the statements of cash flows.

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The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheets that sum to the total of the same such amounts shown in the condensed consolidated statements of cash flows (in thousands):

	April 28, 2018		January 27, 2018		April 29, 2017		January 28, 2017
Cash and cash equivalents	$	13,532	$	8,525	$	10,576	$	7,092
Restricted cash		2,515		—		564		482
Cash, cash equivalents and restricted cash	$	16,047	$	8,525	$	11,140	$	7,574

2.    Revenue Recognition

On January 28, 2018, we adopted ASU 2014-09 using the retrospective transition method.  ASU 2014-09 requires a company to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration the company expects to receive in exchange for those goods or services. Results for all reporting periods presented include the impact of the new guidance under ASU 2014-09, including prior periods that have been recast to reflect the estimated cost of returned assets within other current assets rather than netted with our sales returns reserve within other current liabilities. The adoption of ASU 2014-09 did not impact opening retained earnings as of January 28, 2018 and did not have a material impact on revenues recognized for the thirteen weeks ended April 28, 2018. 

The adoption of ASU 2014-09 had the following impact on our condensed consolidated balance sheets as of January 27, 2018 and April 29, 2017 (in thousands):

	Condensed Consolidated Balance Sheet as of January 27, 2018
			New Revenue
	As Reported		Standard		As Recast
Other current assets	$	13,701	$	952	$	14,653
Total current assets		299,981		952		300,933
Total assets		1,373,289		952		1,374,241
Accrued and other current liabilities		88,547		952		89,499
Total current liabilities		342,721		952		343,673
Total liabilities		782,410		952		783,362
Total liabilities and shareholders' equity		1,373,289		952		1,374,241

	Condensed Consolidated Balance Sheet as of April 29, 2017
			New Revenue
	As Reported		Standard		As Recast
Other current assets	$	4,217	$	999	$	5,216
Total current assets		273,848		999		274,847
Total assets		1,263,147		999		1,264,146
Accrued and other current liabilities		72,096		999		73,095
Total current liabilities		286,980		999		287,979
Total liabilities		714,939		999		715,938
Total liabilities and shareholders' equity		1,263,147		999		1,264,146

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The adoption of ASU 2014-09 had the following impact on our condensed consolidated statement of cash flows for the thirteen weeks ended April 29, 2017 (in thousands):

	Condensed Consolidated Statement of Cash Flows
	Thirteen Weeks Ended April 29, 2017
			New Revenue
	As Reported(a)		Standard		As Recast
Prepaid expenses and other current assets	$	(3,166)	$	78	$	(3,088)
Accrued liabilities		(4,633)		(78)		(4,711)
Net cash provided by operating activities		20,850		—		20,850

(a) Accrued liabilities have been reclassified in the prior period to conform with the current period presentation as discussed in Note 1 – Summary of Significant Accounting Policies.

We sell a broad assortment of home décor, including home furnishings and accent décor, and recognize revenue when the customer takes possession or control of goods at the time the sale is completed at the store register. Accordingly, we implicitly enter into a contract with customers at the point of sale. In addition to retail store sales, we also generate revenue through the sale of gift cards and through incentive arrangements associated with our credit card program.

As noted in the segment information in the notes to the consolidated financial statements included in our Annual Report, our business consists of one reportable segment. In accordance with ASC 606, we disaggregate net sales into the following product categories:

	Thirteen Weeks Ended
	April 28, 2018		April 29, 2017
Home furnishings	52	%	53	%
Accent décor	44		44
Other	4		3
Total	100	%	100	%

Contract liabilities are recognized primarily for gift card sales. Cash received from the sale of gift cards is recorded as a contract liability in accrued and other current liabilities, and we recognize revenue upon the customer’s redemption of the gift card. Gift card breakage is recognized as revenue in proportion to the pattern of customer redemptions by applying an estimated breakage rate that takes into account historical patterns of redemptions and deactivations of gift cards.

We recognized approximately $3.6 million and $2.7 million in gift card redemption revenue for the thirteen weeks ended April 28, 2018 and April 29, 2017, respectively, and recognized an immaterial amount in gift card breakage revenue for each of the thirteen weeks ended April 28, 2018 and April 29, 2017. Of the total gift card redemption revenue, $1.4 million and $1.5 million for the thirteen weeks ended April 28, 2018 and April 29, 2017, respectively, related to gift cards issued in prior periods. We had outstanding gift card liabilities of $5.8 million,  $5.8 million and $4.0 million as of April 28, 2018, January 27, 2018 and April 29, 2017, respectively, which are included in accrued and other current liabilities.  Gift card redemption and breakage revenue for the thirteen weeks ended April 28, 2018 and April 29, 2017 and gift card liability as of April 28, 2018, January 27, 2018 and April 29, 2017 reported under ASC 606 were not materially different from amounts that would have been reported under the previous revenue guidance of ASC 605. We will continue to monitor future quarters for materiality.

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In fiscal year 2018, we launched a credit card program by which credit is extended to eligible customers through private label and co-branded credit cards with Synchrony Bank (“Synchrony”). Through the launch of the credit card program, we received reimbursement of costs associated with the launch of the credit card program as well as a one-time payment which has been deferred over the initial seven-year term of the agreement with Synchrony. We receive ongoing payments from Synchrony based on sales transacted on our credit cards and for reimbursement of joint marketing and advertising activities. During the thirteen weeks ended April 28, 2018, we recorded an immaterial amount of income from our credit card program within net sales when earned.

Our credit card program includes a loyalty component that allows for customers to earn points for qualifying purchases. Upon reaching specified levels, points are redeemed for certificates usable at our stores. As there are no directly observable selling prices for these points, we are required  to account for the points using a relative fair value approach. During the thirteen weeks ended April 28, 2018, we recorded an immaterial amount for the deferral of revenues related to our loyalty program as a reduction of revenues.

Customers may return purchased items for an exchange or refund. Historically, the sales returns reserve was presented net of cost of sales in other current liabilities and based primarily on historical trends and sales performance. ASU 2014-09 also specifies that the balance sheets should reflect both a liability with respect to the refund obligation and an asset representing the right to the returned goods on a gross basis. In adopting ASU 2014-09, we utilized the expected value methodology in which different scenarios including current sales return data and historical quarterly sales return rates are used to develop an estimated sales return rate. During the fiscal year ended January 27, 2018, we utilized the practical expedient provided under ASU 2014-09 to assess all sales on a portfolio basis, as this did not yield materially different results from the actual sales returns. As such,  we now present the sales returns reserve within other current liabilities and the estimated value of the inventory that will be returned within other current assets in the condensed consolidated balance sheets. The components of the sales returns reserve reflected in the condensed consolidated balance sheets consist of the following (in thousands):

	April 28,		January 27,		April 29,
	2019		2018		2017
Accrued and other current liabilities	$	3,332	$	2,023	$	2,365
Other current assets		1,429		952		999
Sales returns reserve, net	$	1,903	$	1,071	$	1,366

3.    Fair Value Measurements

We follow the provisions of Accounting Standards Codification (“ASC”) 820 (Topic 820, “Fair Value Measurements and Disclosures”). ASC 820 establishes a three-tiered fair value hierarchy that prioritizes inputs to valuation techniques used in fair value calculations.

· Level 1 - Unadjusted quoted market prices for identical assets or liabilities in active markets that we have the ability to access.

· Level 2 - Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in inactive markets; or valuations based on models where the significant inputs are observable (e.g., interest rates, yield curves, prepayment speeds, default rates, loss severities, etc.) or can be corroborated by observable market data.

· Level 3 - Valuations based on models where significant inputs are not observable. The unobservable inputs reflect our own assumptions about the assumptions that market participants would use.

ASC 820 requires us to maximize the use of observable inputs and minimize the use of unobservable inputs. If a financial instrument uses inputs that fall in different levels of the hierarchy, the instrument is categorized based upon the lowest level of input that is significant to the fair value calculation.

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The fair value of all current financial instruments approximates carrying value because of the short-term nature of these instruments. We have variable and fixed rates on our long-term debt. The fair value of long-term debt with variable rates approximates carrying value as the interest rates of these amounts approximate market rates. We determine fair value on our fixed rate debt by using quoted market prices and current interest rates. 

At April 28, 2018, the fair value of our fixed rate mortgage due August 22, 2022 approximated the carrying value of $6.1 million. Fair value for the fixed rate mortgage was determined using Level 2 inputs.

4.    Sale-Leaseback Transactions

In February 2018, we sold four of our properties in Blaine, Minnesota; Fort Worth, Texas; Jackson, Mississippi; and Memphis, Tennessee for a total of $50.3 million, resulting in a net gain of $22.6 million. Contemporaneously with the closing of the sale, we entered into a lease pursuant to which we leased back the properties for cumulative initial annual rent of $3.4 million, subject to annual escalations. The lease is being accounted for as an operating lease. The net gain on the sale of the properties has been deferred and is included in deferred rent liabilities in the accompanying condensed consolidated balance sheets. The gain will be amortized to rent expense on a straight-line basis through the lease term, or February 2033.

5.    Accrued and Other Current Liabilities

Accrued and other current liabilities consist of the following (in thousands):

	April 28,		January 27,		April 29,
	2019		2018		2017
Inventory in-transit	$	10,496	$	14,618	$	13,620
Accrued payroll and other employee-related liabilities		5,858		16,917		4,575
Accrued taxes, other than income		15,500		11,680		13,370
Accrued interest		4,418		4,173		327
Insurance liabilities		3,648		3,391		3,470
Gift card liability		5,800		5,787		4,028
Construction costs		19,947		9,661		10,169
Accrued inbound freight		9,132		10,796		9,110
Other		17,959		12,476		14,426
Total accrued liabilities	$	92,758	$	89,499	$	73,095

6.    Revolving Line of Credit

Interest on borrowings under our $350.0 million senior secured asset-based revolving credit facility (“ABL Facility”) is computed based on our average daily availability, at our option, of: (x) the higher of (i) the Federal Funds Rate plus 1/2 of 1.00%, (ii) the bank's prime rate and (iii) the London Interbank Offered Rate (“LIBOR”) plus 1.00%,  plus in each case, an applicable margin of 0.25% to 0.75% or (y) the bank's LIBOR rate plus an applicable margin of 1.25% to 1.75%. The effective interest rate was approximately 3.50% and 2.30% during the thirteen weeks ended April 28, 2018 and April 29, 2017, respectively.

We have amended the agreement governing the ABL Facility (the “ABL Credit Agreement”) from time to time. After giving effect to such amendments, as of April 28, 2018, the aggregate revolving commitments under the ABL Facility are $350.0 million, with a sublimit for the issuance of letters of credit of $50.0 million and a sublimit for the issuance of swingline loans of $20.0 million. In July 2017, in connection with the Seventh Amendment to the ABL Credit Agreement (the “ABL Amendment”), the maturity of the ABL Facility was extended to the earlier of July 27, 2022 and the date that is 91 days prior to the maturity date of the term loan entered into on June 5, 2015 under a first lien credit agreement (the “First Lien Agreement”) (as such date may be extended).

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As of April 28, 2018, approximately $183.5 million was outstanding under the ABL Facility, approximately $0.6 million in face amount of letters of credit had been issued and we had availability of approximately $80.9 million. As of April 28, 2018, we were in compliance with all covenants prescribed in the ABL Facility.

7.    Long-Term Debt

Long-term debt consists of the following (in thousands):

	April 28,		January 27,		April 29,
	2019		2018		2017
Term Loan	$	291,750	$	292,500	$	294,000
Note payable, bank (a)		6,073		6,108		6,002
Obligations under capital leases		867		911		9,700
Total debt		298,690		299,519		309,702
Less: current maturities		3,319		3,316		3,521
Less: unamortized deferred debt issuance costs		5,974		6,301		6,778
Long-term debt	$	289,397	$	289,902	$	299,403

(a) Matures August 22, 2022;  $34,483 payable monthly, including interest at 4.50% with the remaining balance due at maturity; secured by the location’s land and building.

On June 5, 2015, our indirect wholly owned subsidiary, At Home Holding III Inc. (the “Borrower”), entered into the First Lien Agreement, by and among the Borrower, At Home Holding II Inc. (“At Home II”), a direct wholly owned subsidiary of At Home Group Inc., as guarantor, certain indirect subsidiaries of the Borrower, various lenders and Bank of America, N.A., as administrative agent and collateral agent. The First Lien Agreement provides for a $300.0 million term loan (the “Term Loan”), which amount was borrowed on June 5, 2015. The Term Loan will mature on June 3, 2022, and is repayable in equal quarterly installments of approximately $0.8 million for an annual aggregate amount equal to 1% of the original principal amount. The Borrower has the option of paying interest on a 1-month, 2-month or quarterly basis on the Term Loan at an annual rate of LIBOR (subject to a 1% floor) plus 4.00%, subject to a 0.50% reduction if the Borrower achieves a specified secured net leverage ratio level, which was met during the fiscal year ended January 28, 2017 and for which the Borrower has continued to qualify during the thirteen weeks ended April 28, 2018. The Term Loan is prepayable, in whole or in part, without premium at our option.

On July 27, 2017, the Borrower entered into a First Amendment to the First Lien Agreement to permit the incurrence of additional indebtedness pursuant to the ABL Amendment and to make certain technical changes to conform to the terms of the ABL Amendment.

8.    Related Party Transactions

As of April 28, 2018,  certain affiliates of AEA Investors LP (collectively “AEA”) and Starr Investment Holdings, LLC (“Starr Investments” and, together with AEA, the “Sponsors”) own approximately 61% of our outstanding common stock.

Merry Mabbett Inc. (“MMI”) is owned by Merry Mabbett Dean, who is the mother of Lewis L. Bird III, our Chairman of the Board, Chief Executive Officer and President. During the thirteen weeks ended April 28, 2018 and April 29, 2017, Ms. Dean, through MMI, provided certain design services to us, including design for our home office, as well as design in our stores. In addition, through MMI, we purchased certain fixtures, furniture and equipment that is now owned and used by us in our home office, new store offices or in the product vignettes in the stores. During each of the thirteen weeks ended April 28, 2018 and April 29, 2017, we paid MMI approximately $0.2 million  for fixtures, furniture and equipment and design related services.

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9.    Income Taxes

On December 22, 2017, federal tax reform legislation, known as the Tax Cuts and Jobs Act, was enacted by the U.S. government (the “Tax Act”). The Tax Act makes broad and complex changes to the Internal Revenue Code of 1986, as amended, including, but not limited to, (i) reducing the maximum U.S. federal corporate income tax rate from 35% to 21%; (ii) eliminating the corporate alternative minimum tax (“AMT”) and changing how existing AMT credits are realized; (iii) creating a new limitation on deductible interest expense; and (iv) changing rules related to uses and limitation of net operating loss carryforwards generated in tax years beginning after December 31, 2017. As such, for the fiscal year ended January 26, 2019, the statutory federal corporate income tax rate is 21.0%.

In December of 2017, the Securities and Exchange Commission staff issued State Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (“SAB 118”), which allows us to record provisional amounts during a measurement period not to extend beyond one year from the enactment date. Since the Tax Act was enacted in the fourth fiscal quarter 2018 (and ongoing guidance and accounting interpretations are expected through December of 2018), we consider the accounting of deferred tax re-measurements and other items, such as cost recovery and state tax considerations, to be incomplete due to the forthcoming guidance and our ongoing analysis of final year-end data and tax positions for fiscal years 2019 and 2018. We expect to complete our analysis within the measurement period in accordance with SAB 118.

Our effective tax rate for the thirteen weeks ended April 28, 2018 was 0.3% compared to 38.9 % for the thirteen weeks ended April 29, 2017. The effective tax rate for the thirteen weeks ended April 28, 2018 differs from the current federal statutory rate of 21% primarily due to the recognition of $4.2 million of excess tax benefit related to stock option exercises and the impact of state and local income taxes. The effective tax rate for the thirteen weeks ended April 29, 2017 differs from the previous federal statutory rate of 35% primarily due to the impact of state and local income taxes as well as a strategic restructuring that impacted deferred tax assets.

10.    Commitments and Contingencies

Litigation

We are subject to claims and lawsuits that arise primarily in the ordinary course of business.  It is the opinion of management that the disposition or ultimate resolution of such claims and lawsuits will not have a material adverse effect on our consolidated financial position, results of operations or liquidity.

11.    Earnings Per Share

In accordance with ASC 260, (Topic 260, “Earnings Per Share”), basic earnings per share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding for the period. Diluted earnings per share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding for the period including the dilutive impact of potential shares from the exercise of stock options and restricted stock units. Potentially dilutive securities are excluded from the computation of diluted net income per share if their effect is anti-dilutive.

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The following table sets forth the calculation of basic and diluted earnings per share for the thirteen weeks ended April 28, 2018 and April 29, 2017 as follows (dollars in thousands, except share and per share data):

	Thirteen Weeks Ended
	April 28, 2018		April 29, 2017
Numerator:
Net income	$	18,361	$	10,049
Denominator:
Weighted average common shares outstanding-basic		61,758,330		60,366,768
Effect of dilutive securities:
Stock options and restricted stock units		4,130,833		1,898,480
Weighted average common shares outstanding-diluted		65,889,163		62,265,248
Per common share:
Basic net income per common share	$	0.30	$	0.17
Diluted net income per common share	$	0.28	$	0.16

For the thirteen weeks ended April 28, 2018 and April 29, 2017, approximately 205,882 and 2,743,140, respectively, of stock options were excluded from the calculation of diluted net income per common share since their effect was anti-dilutive.

12.    Stock-Based Compensation

On April  3, 2018, we made a grant of 663,247 options to members of our senior management team and 49,189 restricted stock units to our independent directors and members of our senior management team under the At Home Group Inc. Equity Incentive Plan (the “2016 Equity Plan”). Non-cash stock-based compensation expense associated with the grant of options will be approximately $8.5 million, which will be expensed over the requisite service period of three to four years. Non-cash stock-based compensation expense associated with the grant of restricted stock units will be approximately $1.5 million, which will be expensed over the requisite service period of one to three years. Forfeiture assumptions for the grants were estimated based on historical experience.

13.    Subsequent Events

In June 2018, our Board of Directors approved a grant of 1.5 million options to Chairman and Chief Executive Officer, Lewis L. Bird III. The options vest immediately upon the June 12, 2018 grant date. However, the shares resulting from the exercise of the options will be generally subject to transfer restrictions that lapse on the fourth anniversary of the date of grant, subject to certain service conditions. In addition, the Board of Directors approved a grant of options with an aggregate grant date fair value in an amount to compensate Mr. Bird for the difference in our share price on June 12, 2018 as compared to our share price on April 3, 2018 when annual equity awards were granted to other Company senior executives. As a result of the immediate vesting of these awards, non-cash stock-based compensation expense will be fully recognized in the second quarter of fiscal 2019.

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ITEM 2. — MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This discussion and analysis of the financial condition and results of our operations should be read in conjunction with the unaudited condensed consolidated financial statements and related notes of At Home Group Inc. included in Item 1 of this Quarterly Report on Form 10-Q and with our audited consolidated financial statements and the related notes thereto in our Annual Report on Form 10-K for the fiscal year ended January 27, 2018 as filed with the Securities and Exchange Commission (“SEC”) on March 23, 2018 (the “Annual Report”). You should review the disclosures under the heading “Item 1A. Risk Factors” in the Annual Report, as well as any cautionary language in this report, for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis. All expressions of the “Company”, “us”, “we”, “our”, and all similar expressions are references to At Home Group Inc. and its consolidated wholly-owned subsidiaries, unless otherwise expressly stated or the context otherwise requires.

We operate on a fiscal calendar widely used by the retail industry that results in a given fiscal year consisting of a 52- or 53-week period ending on the last Saturday in January. In a 52-week fiscal year, each quarter contains 13 weeks of operations; in a 53-week fiscal year, each of the first, second and third quarters includes 13 weeks of operations and the fourth quarter includes 14 weeks of operations. References to a fiscal year mean the year in which that fiscal year ends. References herein to “fiscal year 2019” relate to the 52 weeks ending January 26, 2019 and references herein to “fiscal year 2018” relate to the 52 weeks ended January 27, 2018. References herein to “the first fiscal quarter 2019” and “the first fiscal quarter 2018” relate to the thirteen weeks ended April 28, 2018 and April 29, 2017, respectively.

Overview

At Home is the leading home décor superstore based on the number of our locations and our large format stores that we believe dedicate more space per store to home décor than any other player in the industry. We are focused on providing the broadest assortment of products for any room, in any style, for any budget. We utilize our space advantage to out-assort our competition, offering over 50,000 SKUs throughout our stores. Our differentiated merchandising strategy allows us to identify on-trend products and then value engineer those products to provide desirable aesthetics at attractive price points for our customers. Over 70% of our products are unbranded, private label or specifically designed for us. We believe that our broad and comprehensive offering and compelling value proposition combine to create a leading destination for home décor with the opportunity to continue taking market share in a highly fragmented and growing industry.

As of April 28, 2018, our store base is comprised of 156 large format stores across 34 states, averaging approximately 110,000 square feet per store. Over the past five completed fiscal years we have opened 98 new stores and we believe there is significant whitespace opportunity to increase our store count in both existing and new markets.

Trends and Other Factors Affecting Our Business

Various trends and other factors affect or have affected our operating results, including:

Overall economic trends. The overall economic environment and related changes in consumer behavior have a significant impact on our business. In general, positive conditions in the broader economy promote customer spending in our stores, while economic weakness results in a reduction of customer spending. Macroeconomic factors that can affect customer spending patterns, and thereby our results of operations, include employment rates, business conditions, changes in the housing market, the availability of credit, interest rates, tax rates and fuel and energy costs.

Consumer preferences and demand. Our ability to maintain our appeal to existing customers and attract new customers depends on our ability to originate, develop and offer a compelling product assortment responsive to customer preferences and design trends. If we misjudge the market for our products, we may be faced with excess inventories for some products and may be required to become more promotional in our selling activities, which would impact our net sales and gross profit.

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New store openings. We expect new stores will be the key driver of the growth in our sales and operating profit in the future. Our results of operations have been and will continue to be materially affected by the timing and number of new store openings. The performance of new stores may vary depending on various factors such as the store opening date, the time of year of a particular opening, the amount of store opening costs, the amount of store occupancy costs and the location of the new store, including whether it is located in a new or existing market. For example, we typically incur higher than normal employee costs at the time of a new store opening associated with set-up and other opening costs. In addition, in response to the interest and excitement generated when we open a new store, the new stores generally experience higher net sales during the initial period of one to three months after which the new store’s net sales will begin to normalize as it reaches maturity within six months of opening, as further discussed below.

Our planned store expansion will place increased demands on our operational, managerial, administrative and other resources. Managing our growth effectively will require us to continue to enhance our inventory management and distribution systems, financial and management controls and information systems. We will also be required to hire, train and retain store management and store personnel, which, together with increased marketing costs, can affect our operating margins.

A new store typically reaches maturity, meaning the store’s annualized targeted sales volume has been reached, within six months of opening. New stores are included in the comparable store base during the sixteenth full fiscal month following the store’s opening, which we believe represents the most appropriate comparison. We also periodically explore opportunities to relocate a limited number of existing stores to improve location, lease terms, store layout or customer experience. Relocated stores typically achieve a level of operating profitability comparable to our company-wide average for existing stores more quickly than new stores.

Infrastructure investment. Our historical operating results reflect the impact of our ongoing investments to support our growth. In the past five fiscal years, we have made significant investments in our business that we believe have laid the foundation for continued profitable growth. We believe that our strong management team, brand identity, upgraded and automated distribution center and enhanced information systems, including our warehouse management and POS systems, enable us to replicate our profitable store format and differentiated shopping experience. In addition, we implemented a merchandise planning system and upgraded our inventory allocation system to better manage the flow of inventory for each store and corresponding customer base, and we have recently begun to make investments relating to a second distribution center in Pennsylvania that we currently plan to open in fiscal year 2020. We expect these infrastructure investments to support our successful operating model over a significantly expanded store base.

Pricing strategy. We are committed to providing our products at everyday low prices. We value engineer products in collaboration with our suppliers to recreate the “look” that we believe our customer wants while eliminating the costly construction elements that our customer does not value. We believe our customer views shopping At Home as an in-person experience through which our customer can see and feel the quality of our products and physically assemble a desired aesthetic. This design approach allows us to deliver an attractive value to our customers, as our products are typically less expensive than other branded products with a similar look. We employ a simple everyday low pricing strategy that consistently delivers savings to our customers without the need for extensive promotions, as evidenced by over 80% of our net sales occurring at full price.

Our ability to source and distribute products effectively. Our net sales and gross profit are affected by our ability to purchase our products in sufficient quantities at competitive prices. While we believe our vendors have adequate capacity to meet our current and anticipated demand, our level of net sales could be adversely affected in the event of constraints in our supply chain, including the inability of our vendors to produce sufficient quantities of some merchandise in a manner that is able to match market demand from our customers, leading to lost sales.

Fluctuation in quarterly results. Our quarterly results have historically varied depending upon a variety of factors, including our product offerings, promotional events, store openings and shifts in the timing of holidays, among other things. As a result of these factors, our working capital requirements and demands on our product distribution and delivery network may fluctuate during the year.

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Inflation and deflation trends. Our financial results can be expected to be directly impacted by substantial increases in product costs due to commodity cost increases or general inflation which could lead to a reduction in our sales as well as greater margin pressure as costs may not be able to be passed on to consumers. To date, changes in commodity prices and general inflation have not materially impacted our business. In response to increasing commodity prices or general inflation, we seek to minimize the impact of such events by sourcing our merchandise from different vendors, changing our product mix or increasing our pricing when necessary.

Recent Developments

In June 2018, our Board of Directors approved a grant of 1.5 million options to Chairman and Chief Executive Officer, Lewis L. Bird III. The options vest immediately upon the June 12, 2018 grant date. However, the shares resulting from the exercise of the options will be generally subject to transfer restrictions that lapse on the fourth anniversary of the date of grant, subject to certain service conditions. In addition, the Board of Directors approved a grant of options with an aggregate grant date fair value in an amount to compensate Mr. Bird for the difference in our share price on June 12, 2018 as compared to our share price on April 3, 2018 when annual equity awards were granted to other Company senior executives. As a result of the immediate vesting of these awards, non-cash stock-based compensation expense will be fully recognized in the second quarter of fiscal 2019. For further information regarding this equity incentive award, see “Item 5. Other Information”.

How We Assess the Performance of Our Business

In assessing our performance, we consider a variety of performance and financial measures. The key measures include net sales, gross profit and gross margin, and selling, general and administrative expenses. In addition, we also review other important metrics such as Adjusted EBITDA, Store-level Adjusted EBITDA and Adjusted Net Income.

Net Sales

Net sales are derived from direct retail sales to customers in our stores, net of merchandise returns and discounts. Growth in net sales is impacted by opening new stores and increases in comparable store sales.

New store openings

The number of new store openings reflects the new stores opened during a particular reporting period, including any relocations of existing stores during such period. Before we open new stores, we incur pre-opening costs, as described below. The total number of new stores per year and the timing of store openings has, and will continue to have, an impact on our results as described above in “—Trends and Other Factors Affecting Our Business”.

Comparable store sales

A store is included in the comparable store sales calculation on the first day of the sixteenth full fiscal month following the store's opening, which is when we believe comparability is achieved. When a store is being relocated or remodeled, we exclude sales from that store in the calculation of comparable store sales until the first day of the sixteenth full fiscal month after it reopens. In addition, when applicable, we adjust for the effect of the 53rd week. There may be variations in the way in which some of our competitors and other retailers calculate comparable or “same store” sales. As a result, data in this report regarding our comparable store sales may not be comparable to similar data made available by other retailers.

Comparable store sales allow us to evaluate how our store base is performing by measuring the change in period-over-period net sales in stores that have been open for the applicable period. Various factors affect comparable store sales, including:

· consumer preferences, buying trends and overall economic trends;

· our ability to identify and respond effectively to customer preferences and trends;

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· our ability to provide an assortment of high quality and trend-right product offerings that generate new and repeat visits to our stores;

· the customer experience we provide in our stores;

· our ability to source and receive products accurately and timely;

· changes in product pricing, including promotional activities;

· the number of items purchased per store visit;

· weather; and

· timing and length of holiday shopping periods.

Opening new stores is an important part of our growth strategy. As we continue to pursue our growth strategy, we anticipate that an increasing percentage of our net sales will come from stores not included in our comparable store sales calculation. Accordingly, comparable store sales are only one measure we use to assess the success of our growth strategy.

Gross Profit and Gross Margin

Gross profit is determined by subtracting cost of sales from our net sales. Gross margin measures gross profit as a percentage of net sales.

Cost of sales consists of various expenses related to the cost of selling our merchandise. Cost of sales consists of the following: (1) cost of merchandise, net of inventory shrinkage, damages and vendor allowances; (2) inbound freight and internal transportation costs such as distribution center-to-store freight costs; (3) costs of operating our distribution center, including labor, occupancy costs, supplies, and depreciation; and (4) store occupancy costs including rent, insurance, taxes, common area maintenance, utilities, repairs and maintenance and depreciation. The components of our cost of sales expenses may not be comparable to other retailers.

Selling, General and Administrative Expenses

Selling, general and administrative expenses (“SG&A”) consist of various expenses related to supporting and facilitating the sale of merchandise in our stores. These costs include payroll, benefits and other personnel expenses for corporate and store employees, including stock-based compensation expense, consulting, legal and other professional services expenses, marketing and advertising expenses, occupancy costs for our corporate headquarters and various other expenses.

SG&A includes both fixed and variable components and, therefore, is not directly correlated with net sales. In addition, the components of our SG&A expenses may not be comparable to those of other retailers. We expect that our SG&A expenses will increase in future periods due to our continuing store growth, and anticipate that marketing expense for fiscal 2019 will increase to approximately 3% of net sales. In addition, any increase in future stock option or other stock-based grants or modifications will increase our stock-based compensation expense included in SG&A. In particular, the one-time bonus grant of stock options to certain members of our senior management in connection with our initial public offering will result in incremental non-cash stock-based compensation expense of approximately $20.0 million, which is being expensed over the derived service period that began in the third quarter of fiscal 2017 and continuing into the third quarter of fiscal 2019.  

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Adjusted EBITDA

Adjusted EBITDA is a key metric used by management and our board of directors to assess our financial performance. Adjusted EBITDA is also the basis for performance evaluation under our current executive compensation programs. In addition, Adjusted EBITDA is frequently used by analysts, investors and other interested parties to evaluate companies in our industry. In addition to covenant compliance and executive performance evaluations, we use Adjusted EBITDA to supplement generally accepted accounting principles in the United States of America (“GAAP”) measures of performance to evaluate the effectiveness of our business strategies, to make budgeting decisions and to compare our performance against that of other peer companies using similar measures.

Adjusted EBITDA is defined as net income before interest expense, net, loss from early extinguishment of debt, income tax provision and depreciation and amortization, adjusted for the impact of certain other items as defined in our debt agreements, including certain legal settlements and consulting and other professional fees, relocation and employee recruiting incentives, management fees and expenses, stock-based compensation expense, impairment of our trade name and non-cash rent. For a reconciliation of Adjusted EBITDA to net income, the most directly comparable GAAP measure, see “—Results of Operations”.

Store-level Adjusted EBITDA

We use Store-level Adjusted EBITDA as a supplemental measure of our performance, which represents our Adjusted EBITDA excluding the impact of costs associated with new store openings and certain corporate overhead expenses that we do not consider in our evaluation of the ongoing operating performance of our stores from period to period. Our calculation of Store-level Adjusted EBITDA is a supplemental measure of operating performance of our stores and may not be comparable to similar measures reported by other companies. We believe that Store-level Adjusted EBITDA is an important measure to evaluate the performance and profitability of each of our stores, individually and in the aggregate, especially given the level of investments we have made in our home office and infrastructure over the past four years to support future growth. We also believe that Store-level Adjusted EBITDA is a useful measure in evaluating our operating performance because it removes the impact of general and administrative expenses, which are not incurred at the store level, and the costs of opening new stores, which are non-recurring at the store level, and thereby enables the comparability of the operating performance of our stores during the period. We use Store-level Adjusted EBITDA information to benchmark our performance versus competitors. Store-level Adjusted EBITDA should not be used as a substitute for consolidated measures of profitability of performance because it does not reflect corporate overhead expenses that are necessary to allow us to effectively operate our stores and generate Store-level Adjusted EBITDA. For a reconciliation of Store-level Adjusted EBITDA to net income, the most directly comparable GAAP measure, see “—Results of Operations”.

Adjusted Net Income

Adjusted Net Income represents our net income, adjusted for impairment charges, loss on extinguishment of debt, initial public offering related non-cash stock-based compensation expense and related payroll tax expenses and the federal income tax impact associated with the special one-time initial public offering bonus stock option exercises, transaction costs related to our initial public offering and the registration and sale of shares of our common stock on behalf of our Sponsors, losses incurred due to the modification of debt and tax impacts associated with the federal tax reform legislation enacted on December 22, 2017 (the “Tax Act”). We present Adjusted Net Income because we believe it assists investors and analysts in comparing our performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance. For a reconciliation of Adjusted Net Income to net income, the most directly comparable GAAP measure, see “—Results of Operations”.

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Results of Operations

The following tables summarize key components of our results of operations for the periods indicated, both in dollars and as a percentage of our net sales:

	Thirteen Weeks Ended
	April 28, 2018		April 29, 2017
Statement of Operations Data:
Net sales	$	256,161	$	211,841
Cost of sales		170,917		139,963
Gross profit		85,244		71,878
Operating expenses
Selling, general and administrative expenses		59,465		49,141
Depreciation and amortization		1,579		1,418
Total operating expenses		61,044		50,559
Operating income		24,200		21,319
Interest expense, net		5,778		4,886
Income before income taxes		18,422		16,433
Income tax provision		61		6,384
Net income	$	18,361	$	10,049
Percentage of Net Sales:
Net sales		100.0 %		100.0 %
Cost of sales		66.7 %		66.1 %
Gross profit		33.3 %		33.9 %
Operating expenses
Selling, general and administrative expenses		23.2 %		23.2 %
Depreciation and amortization		0.6 %		0.7 %
Total operating expenses		23.8 %		23.9 %
Operating income		9.4 %		10.1 %
Interest expense, net		2.3 %		2.3 %
Income before income taxes		7.2 %		7.8 %
Income tax provision		0.0 %		3.0 %
Net income		7.2 %		4.7 %
Operational Data:
Total stores at end of period		156		129
New stores opened		9		7
Comparable store sales		0.9%		5.8%
Non-GAAP Measures(1):
Store-level Adjusted EBITDA(2)	$	68,150	$	59,077
Store-level Adjusted EBITDA margin(2)		26.6%		27.9%
Adjusted EBITDA(2)	$	42,203	$	37,376
Adjusted EBITDA margin(2)		16.5%		17.6%
Adjusted Net Income(3)	$	20,125	$	11,712

(1) We present Adjusted EBITDA, Adjusted EBITDA margin, Store-level Adjusted EBITDA, Store-level Adjusted EBITDA margin and Adjusted Net Income, which are not recognized financial measures under GAAP, because we believe they assist investors and analysts in comparing our operating performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance, such as interest, depreciation, amortization, loss on extinguishment of debt, impairment charges and taxes. You are encouraged to evaluate these adjustments and the reasons we consider them appropriate for supplemental analysis. In evaluating Adjusted EBITDA, Store-level Adjusted EBITDA and Adjusted Net Income, you should be aware that in the future we may incur expenses that are the same as or similar to some of the adjustments in our presentation of Adjusted EBITDA, Store-level Adjusted EBITDA and Adjusted Net Income. In particular, Store-level Adjusted EBITDA does not reflect costs associated with new store openings, which are incurred on a limited basis with respect to any particular store when opened and are not indicative of ongoing core operating performance, and corporate overhead expenses that are necessary to allow us to effectively operate our stores and generate Store-level Adjusted EBITDA. Our presentation of Adjusted EBITDA, Store-level Adjusted EBITDA and Adjusted Net Income should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. There can be no assurance that we will not modify the presentation of Adjusted EBITDA, Store-level Adjusted EBITDA and Adjusted Net Income in the future, and any

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such modification may be material. In addition, Adjusted EBITDA, Adjusted EBITDA margin, Store-level Adjusted EBITDA, Store-level Adjusted EBITDA margin and Adjusted Net Income may not be comparable to similarly titled measures used by other companies in our industry or across different industries.

Management believes Adjusted EBITDA is helpful in highlighting trends in our core operating performance, while other measures can differ significantly depending on long-term strategic decisions regarding capital structure, the tax jurisdictions in which companies operate and capital investments. We also use Adjusted EBITDA in connection with performance evaluations for our executives; to supplement GAAP measures of performance in the evaluation of the effectiveness of our business strategies; to make budgeting decisions; and to compare our performance against that of other peer companies using similar measures. In addition, we utilize Adjusted EBITDA in certain calculations under our ABL Facility (defined therein as “Consolidated EBITDA”) and our Term Loan (defined therein as “Consolidated Cash EBITDA”). Management believes Store-level Adjusted EBITDA is helpful in highlighting trends because it facilitates comparisons of store operating performance from period to period by excluding the impact of costs associated with new store openings and certain corporate overhead expenses, such as certain costs associated with management, finance, accounting, legal and other centralized corporate functions. Management believes that Adjusted Net Income assists investors and analysts in comparing our performance across reporting periods on a consistent basis by excluding items we do not believe are indicative of our core operating performance.

(2) The following table reconciles our net income to EBITDA, Adjusted EBITDA and Store-level Adjusted EBITDA for the periods presented (in thousands):

	Thirteen Weeks Ended
	April 28, 2018		April 29, 2017
Net income	$	18,361	$	10,049
Interest expense, net		5,778		4,886
Income tax provision		61		6,384
Depreciation and amortization(a)		11,456		10,836
EBITDA	$	35,656	$	32,155
Consulting and other professional services(b)		2,348		1,554
Stock-based compensation expense(c)		832		570
Stock-based compensation related to special one-time IPO bonus grant(d)		1,296		2,719
Non-cash rent(e)		1,657		468
Other(f)		414		(90)
Adjusted EBITDA	$	42,203	$	37,376
Costs associated with new store openings(g)		3,739		3,959
Corporate overhead expenses(h)		22,208		17,742
Store-level Adjusted EBITDA	$	68,150	$	59,077

(a) Includes the portion of depreciation and amortization expenses that are classified as cost of sales in our condensed consolidated statements of income.

(b) Primarily consists of (i) consulting and other professional fees with respect to projects to enhance our merchandising and human resource capabilities and other company initiatives; and (ii)charges incurred in connection with the sale of shares of our common stock on behalf of our Sponsors.

(c) Non-cash stock-based compensation related to the ongoing equity incentive program that we have in place to incentivize, retain and motivate our employees, officers, consultants and non-employee directors.

(d) Non-cash stock-based compensation associated with a special one-time initial public offering bonus grant to senior executives, which we do not consider in our evaluation of our ongoing performance. The grant was made in addition to the ongoing equity incentive program that we have in place to incentivize and retain management and was made to reward certain senior executives for historical performance and allow them to benefit from future successful outcomes for our Sponsors.

(e) Consists of the non-cash portion of rent, which reflects (i) the extent to which our GAAP straight-line rent expense recognized exceeds or is less than our cash rent payments, partially offset by (ii) the amortization of deferred gains on sale-leaseback transactions that are recognized to rent expense on a straight-line basis through the applicable lease term. The offsetting amounts relating to the amortization of deferred gains on sale-leaseback transactions were $(2.0) million and $(1.5) million during the thirteen weeks ended April 28, 2018 and April 29, 2017, respectively. The GAAP straight-line rent expense adjustment can vary depending on the average age of our lease portfolio, which has been impacted by our significant growth. For newer leases, our

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rent expense recognized typically exceeds our cash rent payments while for more mature leases, rent expense recognized is typically less than our cash rent payments.

(f) Other adjustments include amounts our management believes are not representative of our ongoing operations, including a payroll tax expense of $0.3 million related to the exercise of stock options for the thirteen weeks ended April  28, 2018.

(g) Reflects non-capital expenditures associated with opening new stores, including marketing and advertising, labor and cash occupancy expenses. Costs related to new store openings represent cash costs, and you should be aware that in the future we may incur expenses that are similar to these costs. We anticipate that we will continue to incur cash costs as we open new stores in the future. We opened nine and seven new stores during the thirteen weeks ended April 28, 2018 and April 29, 2017, respectively.

(h) Reflects corporate overhead expenses, which are not directly related to the profitability of our stores, to facilitate comparisons of store operating performance as we do not consider these corporate overhead expenses when evaluating the ongoing performance of our stores from period to period. Corporate overhead expenses, which are a component of selling, general and administrative expenses, are comprised of various home office general and administrative expenses such as payroll expenses, occupancy costs, marketing and advertising, and consulting and professional fees. See our discussion of the changes in selling, general and administrative expenses presented in “—Results of Operations”. Store-level Adjusted EBITDA should not be used as a substitute for consolidated measures of profitability or performance because it does not reflect corporate overhead expenses that are necessary to allow us to effectively operate our stores and generate Store-level Adjusted EBITDA. We anticipate that we will continue to incur corporate overhead expenses in future periods.

(3) The following table reconciles our netincome to Adjusted Net Income for the periods presented (in thousands):

	Thirteen Weeks Ended
	April 28, 2018		April 29, 2017
Net income as reported	$	18,361	$	10,049
Adjustments:
Stock-based compensation related to special one-time IPO bonus grant(a)		1,296		2,719
Payroll tax expense related to special one-time IPO bonus stock option exercises(b)		11		—
Transaction costs(c)		522		—
Tax impact of adjustments to net income(d)		(11)		(1,056)
Tax impact related to special one-time IPO bonus stock option exercises(e)		(54)		—
Adjusted Net Income	$	20,125	$	11,712

(a) Non-cash stock-based compensation associated with a special one-time initial public offering bonus grant to certain members of senior management (the “IPO grant”), which we do not consider in our evaluation of our ongoing performance. The grant was made in addition to the ongoing equity incentive program that we have in place to incentivize and retain management and was made to reward certain senior executives for historical performance and allow them to benefit from future successful outcomes for our Sponsors.

(b) Payroll tax expense related to stock option exercises associated with the IPO grant, which we do not consider in our evaluation of our ongoing performance.

(c) Charges incurred in connection with the sale of shares of our common stock on behalf of our Sponsors, which we do not consider in our evaluation of our ongoing performance.

(d) Represents the tax impact associated with the adjusted expenses. The effective tax rate of 0.3% for the thirteen weeks ended April 28, 2018 was adjusted to 0.6% to exclude the tax impact of stock option exercises associated with the IPO grant. The effective tax rate for the thirteen weeks ended April 29, 2017 was 38.9%.

(e) Represents the federal income tax impact related to stock option exercises associated with the IPO grant.

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Thirteen Weeks Ended April 28, 2018 Compared to Thirteen Weeks Ended April 29, 2017

Net Sales

Net sales increased $44.4 million, or 20.9%, to $256.2 million for the thirteen weeks ended April 28, 2018 from $211.8 million for the thirteen weeks ended April 29, 2017. The increase was primarily driven by approximately $42.7 million of incremental revenue from the net addition of 27 new stores opened since April 29, 2017 as well as the addition of a number of stores that were opened prior to April 29, 2017 but had not yet been open for 15 months and, as a result, were not included in the comparable store base. The remaining $1.7 million increase in net sales is attributable to comparable store sales, which increased 0.9% during the thirteen weeks ended April 28, 2018, driven primarily by our merchandising and marketing initiatives and was partially offset by the impact of adverse weather conditions for the thirteen weeks ended April 28, 2018.  

Cost of Sales

Cost of sales increased $30.9 million, or 22.1%, to $170.9 million for the thirteen weeks ended April 28, 2018 from $140.0 million for the thirteen weeks ended April 29, 2017. This increase was primarily driven by the 20.9% increase in net sales for the thirteen weeks ended April 28, 2018 compared to the thirteen weeks ended April 29, 2017, which resulted in a $20.5 million increase in merchandise costs. In addition, during the thirteen weeks ended April 28, 2018, we recognized a $0.5 million increase in depreciation and amortization and a $7.0 million increase in store occupancy costs, in each case as a result of new store openings since April 29, 2017.

Gross Profit and Gross Margin

Gross profit was $85.2 million, or 33.3% of net sales, for the thirteen weeks ended April 28, 2018, an increase of $13.3 million from $71.9 million, or 33.9% of net sales, for the thirteen weeks ended April 29, 2017. The increase in gross profit was primarily driven by increased sales volume from the net addition of 27 new stores opened since April 29, 2017 as well as a 0.9% increase in comparable store sales. Gross margin decreased 60 basis points during the thirteen weeks ended April 28, 2018 when compared to the thirteen weeks ended April 29, 2017.  The decrease was primarily driven by increased occupancy costs resulting from (i) our first fiscal quarter 2019 and third fiscal quarter 2018 sale-leaseback transactions and (ii) increased snow removal expenses related to adverse weather conditions.

Selling, General and Administrative Expenses

Selling, general and administrative expenses were $59.5 million for the thirteen weeks ended April 28, 2018 compared to $49.1 million for the thirteen weeks ended April 29, 2017, an increase of $10.4 million or 21.0%. As a percentage of sales, SG&A remained consistent for the thirteen weeks ended April 28, 2018  and April 29, 2017 at 23.2%, primarily due to a decrease in stock-based compensation expenses associated with the special one-time IPO bonus grant issued under the 2016 Equity Plan and a decrease in store pre-opening costs due to the timing of new store openings which was offset by increased marketing and advertising expenses. SG&A expenses include corporate overhead expenses, which represented $2.4 million of the increase, primarily attributable to increased payroll expenses to support our growth strategies and transaction costs related to our secondary offering. SG&A expenses also include expenses related to store operations, which represented $4.3 million of the increase, primarily driven by additional headcount for our new stores.

The remaining increase in selling, general and administrative expenses was related to marketing and advertising expenses. Total marketing and advertising expenses were $9.4 million for the thirteen weeks ended April 28, 2018 compared to $5.7 million for the thirteen weeks ended April 29, 2017, an increase of $3.7 million or 64.6%. The increase was driven by our efforts to continue to build brand awareness. Store pre-opening costs include additional marketing and advertising expenses of $0.2 million and $0.4 million for the thirteen weeks ended April 28, 2018 and April 29, 2017, respectively.

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Interest Expense, Net

Interest expense, net increased to $5.8 million for the thirteen weeks ended April 28, 2018 from $4.9 million for the thirteen weeks ended April 29, 2017, an increase of $0.9 million. The increase in interest expense is primarily due to increased borrowings under our ABL Facility to support our growth strategies in addition to increases in the average interest rates applicable to our variable rate debt during the period. The effective interest rate for the ABL Facility was approximately 3.50% and 2.30% during the thirteen weeks ended April 28, 2018 and April 29, 2017, respectively

Income Tax Provision

Income tax expense was $0.1 million for the thirteen weeks ended April 28, 2018 compared to income tax expense of $6.4 million for the thirteen weeks ended April 29, 2017. The effective tax rate for the thirteen weeks ended April 28, 2018 was 0.3% compared to 38.9% for the thirteen weeks ended April 29, 2017.  The effective tax rate for the thirteen weeks ended April 28, 2018 differs from the current federal statutory rate of 21% primarily due to the recognition of $4.2 million of excess tax benefit realized related to stock option exercises and the impact of state and local income taxes. The effective tax rate for the thirteen weeks ended April 29, 2017 differs from the previous federal statutory rate of 35% primarily due to the impact of state and local income taxes as well as a planned restructuring that impacted deferred tax assets.

Liquidity and Capital Resources

Our principal sources of liquidity are our cash generated by operating activities, proceeds from sale-leaseback transactions and borrowings under our ABL Facility. Historically, we have financed our operations primarily from cash generated from operations and periodic borrowings under our ABL Facility. Our primary cash needs are for day-to-day operations, to provide for infrastructure investments in our stores, to finance new store openings, to pay interest and principal on our indebtedness and to fund working capital requirements for seasonal inventory builds and new store inventory purchases.

As of April 28, 2018, we had $13.5 million of cash and cash equivalents and $80.9 million in borrowing availability under our ABL Facility. At that date, there were $0.6 million in face amount of letters of credit that had been issued under the ABL Facility.  The agreement governing the ABL Facility (the “ABL Credit Agreement”), as amended, currently provides for aggregate revolving commitments of $350.0 million, with a sublimit for the issuance of letters of credit of $50.0 million and a sublimit for the issuance of swingline loans of $20.0 million. The availability under our ABL Facility is determined in accordance with a borrowing base which can decline due to various factors. Therefore, amounts under our ABL Facility may not be available when we need them.

In June 2015, we entered into the Term Loan (as described in “—Term Loan”). The interest rates on the Term Loan is variable; based on LIBOR rates in effect at April 28, 2018, our obligations under the Term Loan bore interest at a rate of 5.3%. The Term Loan is repayable in equal quarterly installments of approximately $0.8 million.

Our capital expenditures can vary depending on the timing of new store openings and infrastructure-related investments. Capital expenditures for the fiscal year ended January 27, 2018 were approximately $170.3 million, net of proceeds from the sale of property and equipment, which includes sale-leaseback proceeds, of approximately $62.4 million. We estimate that our capital expenditures for the fiscal year ending January 26, 2019, which includes investments in our expected second distribution center, will be in the range of $170 million to $190 million, net of proceeds from sale-leaseback transactions of $110 million. We also plan to invest in the infrastructure necessary to support the further development of our business and continued growth. During fiscal year 2018, we opened 26 new stores, net of two relocated stores. Net capital expenditures incurred to date have been substantially financed with cash from operating activities, sale-leaseback transactions and borrowings under our ABL Facility. We expect fiscal year 2019 net capital expenditures to be primarily financed in the same manner.

Based on our growth plans, we believe that our cash position, net cash provided by operating activities and borrowings under our ABL Facility will be adequate to finance our planned capital expenditures, working capital requirements and debt service obligations over the next twelve months and the foreseeable future thereafter. If cash

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flows from operations and borrowings under our ABL Facility are not sufficient or available to meet our capital requirements, then we will be required to obtain additional equity or debt financing in the future. There can be no assurance that equity or debt financing will be available to us when we need it or, if available, that the terms will be satisfactory to us and not dilutive to our then-current shareholders.

Our indebtedness could adversely affect our ability to raise additional capital, limit our ability to react to changes in the economy or our industry, expose us to interest rate risk and prevent us from meeting our obligations. Management reacts strategically to changes in economic conditions and monitors compliance with debt covenants to seek to mitigate any potential material impacts to our financial condition and flexibility.

Sale-Leaseback Transactions

As part of our flexible real estate strategy, we utilize sale-leaseback transactions to finance investments previously made for the purchase of second generation properties and the construction of new store locations. This enhances our ability to access a range of locations and facilities efficiently. We factor sale-leaseback transactions into our capital allocation decisions. In order to support the execution of sale-leaseback transactions, we have relationships with publicly traded REITs and other lenders, many of which have demonstrated interest in our portfolio of assets.

In certain cases, the sale is treated as a like-kind exchange transaction for U.S. federal income tax purposes in accordance with Section 1031 of the Internal Revenue Code (the “Code”). Section 1031 of the Code allows companies to defer the taxable gain realized from the sale of certain “relinquished” real property if the proceeds are reinvested, in a timely manner, in qualifying like-kind “replacement” property. In addition, Section 1031 of the Code requires the sale proceeds of the relinquished property to be held in a restricted cash account by a third-party qualified intermediary, pending utilization thereof for the acquisition of a qualifying replacement property.

In February 2018, we sold four of our properties in Blaine, Minnesota; Fort Worth, Texas; Jackson, Mississippi; and Memphis, Tennessee for a total of $50.3 million, resulting in a net gain of $22.6 million. Contemporaneously with the closing of the sale, we entered into a lease pursuant to which we leased back the properties for cumulative initial annual rent of $3.4 million, subject to annual escalations.

Summary of Cash Flows

A summary of our cash flows from operating, investing and financing activities is presented in the following table (in thousands):

	Thirteen Weeks Ended
	April 28, 2018		April 29, 2017
Net Cash Provided by Operating Activities	$	6,708	$	20,850
Net Cash Used in Investing Activities		(28,950)		(40,879)
Net Cash Provided by Financing Activities		29,764		23,595
Net Increase in Cash, Cash Equivalents and Restricted Cash		7,522		3,566

Net Cash Provided by Operating Activities

Net cash provided by operating activities was $6.7 million for the thirteen weeks ended April 28, 2018 compared to net cash provided by operating activities of $20.9 million for the thirteen weeks ended April 29, 2017. The $14.2 million decrease in cash provided by operating activities was primarily due to a change in the timing of payments for accounts payable and accrued liabilities resulting in a $13.0 million decrease and a $4.9 million increase in purchases of merchandise inventories, which was partially offset by a $2.9 million decrease in cash paid for interest and a $2.9 million increase in operating income.

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Net Cash Used in Investing Activities

Net cash used in investing activities was $29.0 million for the thirteen weeks ended April 28, 2018 compared to $40.9 million for the thirteen weeks ended April 29, 2017. The $11.9 million decrease in cash used in investing activities was driven by a decrease in net capital expenditures resulting from the proceeds of a $50.3 million sale-leaseback transaction that occurred in February 2018. Capital expenditures of $78.6 million for the thirteen weeks ended April 28, 2018 consisted of $74.3 million invested in new store growth with the remaining $4.3 million primarily related to investments in information technology and existing stores. Capital expenditures of $40.9 million for the thirteen weeks ended April 29, 2017 consisted of $38.9 million invested in new store growth with the remaining $2.0 million primarily related to investments in information technology, our distribution center and existing stores.

Net Cash Provided by Financing Activities

Net cash provided by financing activities was $29.8 million for the thirteen weeks ended April 28, 2018 compared to $23.6 million for the thirteen weeks ended April 29, 2017, an increase of $6.2 million primarily due to proceeds from the exercise of stock options of $9.2 million, which was partially offset by a  $3.7 million decrease in net borrowings under our ABL Facility.

Financing Obligations

In some cases, the assets we lease require construction in order to ready the space for its intended use and, in certain cases, we are involved in the construction of leased assets. The construction period typically begins when we execute our lease agreement with the landlord and continues until the space is substantially complete and ready for its intended use. In accordance with ASC 840-40-55 (Topic 840, “Leases”), we must consider the nature and extent of our involvement during the construction period and, in some cases, our involvement results in our being considered the accounting owner of the construction project. By completing the construction of key structural components of a leased building, we are deemed to have participated in the construction of the landlord's asset. In such cases, we capitalize the landlord's construction costs, including the value of costs incurred up to the date we execute our lease and costs incurred during the remainder of construction period, as such costs are incurred. Additionally, ASC 840-40-55 requires us to recognize a financing obligation for construction costs incurred by the landlord. Once construction is complete, we are required to perform a sale-leaseback analysis pursuant to ASC 840-40 to determine if we can remove the landlord's assets and associated financing obligations from our condensed consolidated balance sheets. In certain leases, we maintain various forms of “prohibited continuing involvement” in the property, thereby precluding us from derecognizing the asset and associated financing obligations following the construction completion. In those cases, we will continue to account for the landlord's asset as if we are the legal owner, and the financing obligation, similar to other debt, until the lease expires or is modified to remove the continuing involvement that prohibits derecognition. Once derecognition is permitted, we would be required to account for the lease as either operating or capital in accordance with ASC 840. As of April 28, 2018, we have not derecognized any landlord assets or associated financing obligations.

Term Loan

On June 5, 2015, At Home Holding III Inc. (the “Borrower”) entered into a first lien credit agreement (the “First Lien Agreement”), by and among the Borrower, At Home Holding II Inc. (“At Home II”), certain indirect subsidiaries of the Borrower, various lenders and Bank of America, N.A., as administrative agent and collateral agent. The First Lien Agreement provides for the Term Loan in an original aggregate principal amount of $300.0 million. The Term Loan will mature on June 3, 2022, and is repayable in equal quarterly installments of approximately $0.8 million for an annual aggregate amount equal to 1% of the original principal amount. The Borrower has the option of paying interest on a 1-month, 2-month or quarterly basis on the Term Loan at an annual rate of LIBOR (subject to a 1% floor) plus 4.00%, subject to a 0.50% reduction if the Borrower achieves a specified secured net leverage ratio level, which was met during the fiscal year ended January 28, 2017 and for which the Borrower has continued to qualify during the fiscal year ended January 27, 2018. The Term Loan is prepayable, in whole or in part, without premium at our option.

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The Term Loan permits us to add one or more incremental term loans up to $50.0 million plus additional amounts subject to our compliance with a first lien net leverage ratio test. The first lien net leverage ratio test is calculated using Adjusted EBITDA, which is defined as “Consolidated EBITDA” under our credit agreement.

The Term Loan has various non-financial covenants, customary representations and warranties, events of defaults and remedies substantially similar to those described in respect of the ABL Facility below. There are no financial maintenance covenants in the Term Loan. As of April 28, 2018 and April 29, 2017, we were in compliance with all covenants prescribed under the Term Loan.

Asset-Based Lending Credit Facility

In October 2011, we entered into the ABL Facility, which originally provided for cash borrowings or issuances of letters of credit of up to $80.0 million based on defined percentages of eligible inventory and credit card receivable balances. We have subsequently amended the ABL Credit Agreement from time to time. After giving effect to such amendments, as of January 27, 2018, the aggregate revolving commitments under the ABL Facility are $350.0 million, with a sublimit for the issuance of letters of credit of $50.0 million and a sublimit for the issuance of swingline loans of $20.0 million. In July 2017, in connection with the Seventh Amendment to the ABL Credit Agreement, the maturity of the ABL Facility was extended to the earlier of July 27, 2022 and the date that is 91 days prior to the maturity date of the First Lien Agreement (as such date may be extended).

Borrowings under the ABL Facility bear interest at a rate per annum equal to, at our option: (x) the higher of (i) the Federal Funds Rate plus 1/2 of 1.00%, (ii) the agent bank's prime rate and (iii) LIBOR plus 1.00%, plus in each case, an applicable margin of 0.25% to 0.75% based on our availability or (y) the agent bank's LIBOR rate plus an applicable margin of 1.25% to 1.75% based on our availability. The effective interest rate was approximately 3.50% and 2.30% during the thirteen weeks ended April 28, 2018 and April 29, 2017, respectively.

As of April 28, 2018, approximately $183.5 million was outstanding under the ABL Facility, approximately $0.6 million in face amount of letters of credit had been issued and we had availability of approximately $80.9 million.

The ABL Facility contains a number of covenants that, among other things, restrict our ability to, subject to specified exceptions, incur additional debt; incur additional liens and contingent liabilities; sell or dispose of assets; merge with or acquire other companies; liquidate or dissolve ourselves; engage in businesses that are not in a related line of business; make loans, advances or guarantees; pay dividends; engage in transactions with affiliates; and make investments. In addition, the ABL Facility contains certain cross-default provisions. There are no financial maintenance covenants in the ABL Facility. However, during the existence of an event of default or when we fail to maintain availability of the greater of $15.0 million and 10% of the loan cap, the consolidated fixed charge coverage ratio on a rolling 12 month basis as of the end of any fiscal month must be 1.00 to 1.00 or higher. As of April 28, 2018 and April 29, 2017, we were in compliance with all covenants under the ABL Facility.

Collateral under the ABL Facility and the Term Loan

The ABL Facility is secured by (a) a first priority lien on our (i) cash, cash equivalents, deposit accounts, accounts receivable, other receivables, tax refunds and inventory, (ii) to the extent relating to, arising from, evidencing or governing any of the items referred to in the preceding clause (i), chattel paper, documents, instruments, general intangibles, and securities accounts related thereto, (iii) books and records relating to the foregoing and (iv) supporting obligations and all products and proceeds of the foregoing and all collateral security and guarantees given by any person with respect to any of the foregoing, in each case subject to certain exceptions (collectively, “ABL Priority Collateral”) and (b) a second priority lien on our remaining assets not constituting ABL Priority Collateral, subject to certain exceptions (collectively, “Term Priority Collateral”); provided, however that since our amendment of the ABL Facility in July 2017, real property that may secure the Term Loan from time to time no longer forms part of the collateral under the ABL Facility.

The Term Loan is secured by (a) a first priority lien on the Term Priority Collateral and (b) a second priority lien on the ABL Priority Collateral.

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Off-Balance Sheet Arrangements

We have not historically entered into off-balance sheet arrangements. We do enter into operating lease commitments, letters of credit and purchase obligations in the normal course of our operations.

Seasonality

Our business is moderately seasonal in nature. Historically, our business has realized a slightly higher portion of net sales and operating income in the second and fourth fiscal quarters, attributable primarily to the impact of the summer and year-end holiday decorating seasons, respectively. However, our broad and comprehensive product offering makes us less susceptible to holiday shopping seasonal patterns than many other retailers. Our quarterly results have been and will continue to be affected by the timing of new store openings and their associated pre-opening costs. As a result of these factors, our financial and operating results for any single quarter or for periods of less than a year are not necessarily indicative of the results that may be achieved for a full fiscal year.

Critical Accounting Policies and Estimates

The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses, as well as the related disclosures of contingent assets and liabilities at the date of the financial statements. Management evaluates its accounting policies, estimates, and judgments on an on-going basis. Management bases its estimates and judgments on historical experience and various other factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions and conditions. A summary of our significant accounting policies is included in Note 1 to the annual consolidated financial statements included in the Annual Report. Except as described below, there have been no significant changes in the critical accounting policies and estimates described in the Annual Report. See also “Note 1 – Summary of Significant Accounting Policies” and “Note 2 – Revenue Recognition” to our Condensed Consolidated Financial Statements.

Recent Accounting Pronouncements

In February 2016, the FASB issued ASU No. 2016-02 “Leases”, which supersedes ASC 840 “Leases” and creates a new topic, ASC 842 “Leases” (“ASU 2016-02”). Under ASU 2016-02, an entity will be required to recognize right-of-use assets and lease liabilities on its balance sheet and disclose key information about leasing arrangements. ASU 2016-02 offers specific accounting guidance for a lessee, a lessor and sale and leaseback transactions. Lessees and lessors are required to disclose qualitative and quantitative information about leasing arrangements to enable a user of the financial statements to assess the amount, timing and uncertainty of cash flows arising from leases. ASU 2016-02 is effective for annual reporting periods beginning after December 15, 2018, including interim periods within that reporting period, with early adoption permitted. At adoption, this update will be applied using a modified retrospective approach. We are currently evaluating the impact of ASU 2016-02 and we expect that upon adoption we will recognize right-of-use assets and liabilities that will be material to our financial statements.

In January 2017, the FASB issued ASU No. 2017-04, “Simplifying the Test for Goodwill Impairment” (“ASU 2017-04”). ASU 2017-04 simplifies the measurement of goodwill impairment by removing the second step of the goodwill impairment test, which requires the determination of the fair value of individual assets and liabilities of a reporting unit. Under ASU 2017-04, goodwill impairment is to be measured as the amount by which a reporting unit’s carrying value exceeds its fair value with the loss recognized not to exceed the total amount of goodwill allocated to the reporting unit. ASU 2017-04 is effective for fiscal years beginning after December 15, 2019, with early adoption permitted for interim or annual goodwill impairment tests performed after January 1, 2017. The standard is to be applied on a prospective basis. We are currently evaluating the impact of ASU 2017-04 and do not anticipate a material impact to the consolidated financial statements once implemented.

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Jumpstart Our Business Act of 2012

We are an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012, which we refer to as the JOBS Act. We will remain an emerging growth company until the earlier of (1) the last day of our fiscal year (a) following the fifth anniversary of the completion of our initial public offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock that is held by non-affiliates exceeds $700.0 million as of the last business day of our most recently completed second fiscal quarter, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. An emerging growth company may take advantage of specified reduced reporting and other burdens that are otherwise applicable generally to public companies.

As an emerging growth company, the JOBS Act allows us to take advantage of an extended transition period to comply with new or revised accounting standards applicable to public companies. We have chosen to irrevocably ‘‘opt out’’ of this provision and, as a result, we comply with new or revised accounting standards as required when they are adopted.

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS

Interest Rate Risk

We have market risk exposure arising from changes in interest rates on our ABL Facility and Term Loan, which bear interest at rates that are benchmarked against LIBOR. Based on our overall interest rate exposure to variable rate debt outstanding as of April 28, 2018, a 1% increase or decrease in interest rates would increase or decrease income before income taxes by approximately $4.8 million. A 1% increase or decrease in interest rates would impact the fair value of our long-term fixed rate debt by an immaterial amount. A change in interest rates would not materially affect the fair value of our variable rate debt as the debt reprices periodically.

Impact of Inflation

Our results of operations and financial condition are presented based on historical cost. While it is difficult to accurately measure the impact of inflation due to the imprecise nature of the estimates required, we believe the effects of inflation, if any, on our results of operations and financial condition have been immaterial. We cannot assure you, however, that our results of operations and financial condition will not be materially impacted by inflation in the future.

Foreign Currency Risk

We purchase approximately 60% of our merchandise from suppliers in foreign countries, however, those purchases are made exclusively in U.S. dollars. Therefore, we do not believe that foreign currency fluctuation has had a material impact on our financial performance for the periods presented in this report.

Item 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Our management has evaluated, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, the effectiveness of our disclosure controls and procedures, as defined in Rule 13(a)-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures as of the end of the period covered by this Quarterly Report on Form 10-Q are effective at a reasonable assurance level in ensuring that information required to be disclosed in our Exchange Act reports is (1) recorded, processed, summarized and reported in a timely manner and (2) accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

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Changes in Internal Control over Financial Reporting

There were no changes to our internal control over financial reporting during the thirteen weeks ended April 28, 2018 that have materially affected, or that are reasonably likely to materially affect, our internal control over financial reporting.

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PART II — OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

We are subject to various litigations, claims and other proceedings that arise from time to time in the ordinary course of business. We believe these actions are routine and incidental to the business. While the outcome of these actions cannot be predicted with certainty, we do not believe that any will have a material adverse impact on our business.

ITEM 1A.  RISK FACTORS

There have been no material changes to our principal risks that we believe are material to our business, results of operations and financial condition, from the risk factors previously disclosed in our Annual Report on Form 10-K for the fiscal year ended January 27, 2018 as filed with the SEC on March 23, 2018 which is accessible on the SEC’s website at www.sec.gov.

ITEM 2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4.  MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5.  OTHER INFORMATION

Equity Incentive Grants to Chief Executive Officer

On June 7, 2018, the Board of Directors (the “Board”) of the Company approved granting to Lewis L. Bird III, the Company’s Chairman and Chief Executive Officer, a special nonqualified stock option award (the “CEO Special Option Grant”) with a grant date of June 12, 2018 (the “Date of Grant”), which is the day on which the Company’s trading window period opens. Pursuant to the CEO Special Option Grant, Mr. Bird has the right to purchase a number of shares of the Company’s common stock equal to the sum of (i) 1,500,000 shares plus (ii) a number of shares of common stock having a fair value (as estimated using the Black Scholes option pricing model) as of the Date of Grant, as determined by the Board, equal to the product of (x) 1.5 million and (y) the amount by which the fair market value of a share of common stock on the Date of Grant exceeds $31.56, which is the fair market value of a share of common stock on April 3, 2018, the date on which certain options were granted to other Company management team members. The options granted under the CEO Special Option Grant will have a strike price equal to the closing price per share of the Company’s common stock on the New York Stock Exchange (“NYSE”) on the Date of Grant. Following this award, the Board does not intend to provide annual equity grants to Mr. Bird for the next four years. Assuming the CEO Special Option Grant had been made at a price per share of common stock of $34.87 (the closing price per share of the Company’s common stock on June 1, 2018), the total number of shares issuable pursuant to the CEO Special Option Grant would be approximately 1,764,000 (i.e., 1,500,000 plus 264,000 shares). The actual number of shares subject to the CEO Special Option Grant may be different than the number used for the calculations above, depending on whether the closing price per share of common stock on the Date of Grant is higher or lower than the closing price on June 1, 2018 (the date used for the calculations above).    

The CEO Special Option Grant was issued pursuant to the terms and conditions of the At Home Group Inc. Equity Incentive Plan (the “Equity Plan”) and a notice of grant and nonqualified stock option award agreement substantially in the form attached as Exhibit 10.1 to this Quarterly Report on Form 10-Q and incorporated herein by

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reference. The CEO Special Option Grant has a seven year term, is immediately vested as of the Date of Grant and is exercisable for restricted shares of common stock of the Company subject to transfer restrictions that lapse on the fourth anniversary of the Date of Grant, subject to Mr. Bird’s remaining employed by the Company as of the fourth anniversary of the Date of Grant, except as otherwise described below. 

If, prior to the fourth anniversary of the Date of Grant, Mr. Bird is terminated by the Company without Cause, resigns for Good Reason (as such terms are defined in his employment agreement) or ceases employment due to death or Disability (as defined in the Equity Plan) (any such event, a “Qualifying Termination Event”), the transfer restrictions will lapse as of the date of such Qualifying Termination Event. In addition, the transfer restrictions will lapse upon a Change in Control (as defined in the Equity Plan). To the extent that the transfer restrictions on the restricted shares issuable pursuant to the CEO Special Option Grant have not lapsed on or prior to the eighth anniversary of the Date of Grant, such restrictions shall automatically lapse as of the eighth anniversary of the Date of Grant regardless of whether or not Mr. Bird has experienced a Qualifying Termination Event on or prior to such eighth anniversary. While the transfer restrictions remain in place, any restricted shares delivered upon exercise of the CEO Special Option Grant are subject to a clawback at the lesser of cost and the then-fair market value of such shares in the event Mr. Bird breaches any restrictive covenants to which he is bound in favor of the Company. 

As a result of the immediate vesting of the CEO Special Option Grant, the Company will recognize the full amount of the associated non-cash equity compensation expense in the second quarter of fiscal 2019, and such expense will be excluded from the Company’s calculation of Pro Forma Adjusted Net Income and Pro Forma Adjusted Earnings per Share. The actual amount of such expense will be finalized upon the calculation of the number of shares subject to the CEO Special Option Grant as of the close of trading on the NYSE on the Date of Grant. If the CEO Special Option Grant had been made based on an assumed stock price of $34.87, which was the closing price of the Company’s common stock on June 1, 2018, the total amount of the associated non-cash stock-based compensation expense would have been approximately $33.2 million.  Each $1.00 per share increase or decrease in the closing price of the Company’s common stock would result in a corresponding increase or decrease in aggregate stock-based compensation expense of approximately $2.3 million. The expense associated with the CEO Special Option Grant will be incremental to the Company’s ongoing stock-based compensation expense.

Amendment of April 2018 Grants

On June 7, 2018, the Board approved amendments to certain equity incentive award agreements previously granted to officers and independent directors of the Company, including the Company’s named executive officers, on April 3, 2018 (the “April 2018 Grants”). 

The April 2018 Grants to officers consisted of an annual nonqualified stock option grant (the “Annual Option Grant”) and an annual restricted stock unit grant (the “Annual RSU Grant”), each of which vests in equal installments over the first three anniversaries of the grant date, subject to continued employment, and, for certain officers, a one-time special transition nonqualified stock option grant (the “Special Transition Grant”), which vests in equal installments on the third and fourth anniversaries of the grant date, subject to continued employment. The Board amended the Annual Option Grants and Annual RSU Grants pursuant to amended and restated grant agreements substantially in the forms attached as Exhibits 10.2 and 10.3 to this Quarterly Report on Form 10-Q and incorporated herein by reference to provide for accelerated vesting upon a termination without Cause or resignation for Good Reason (as such terms are defined in the applicable grant agreements). In addition, the Board amended the Special Transition Grants pursuant to amended and restated grant agreements substantially in the form attached as Exhibit 10.4 to this Quarterly Report on Form 10-Q and incorporated herein by reference to provide for accelerated vesting upon the consummation of a Change in Control (as defined in the Equity Plan), subject to continued employment through such date.

The April 2018 Grants to independent directors consisted of an annual restricted stock unit grant (the “Director RSU Grant”), which fully vests on the first anniversary of the date of grant, subject to continued service through such date. The Board amended the Director RSU Grants pursuant to amended and restated grant agreements substantially in the form attached as Exhibit 10.5 to this Quarterly Report on Form 10-Q and incorporated herein by reference to provide for accelerated vesting upon a director’s termination of service by the Company without Cause on or within one year following a Change in Control (as defined in the applicable grant agreements).

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Amendment of Employment Agreement of Chief Financial Officer

On June 1, 2018, the Compensation Committee (the “Committee”) of the Board of the Company approved the amendment, dated June 7, 2018,  attached as Exhibit 10.6 to this Quarterly Report on Form 10-Q and incorporated herein by reference (the “Nystrom Amendment”) to the employment agreement with Mr. Judd Nystrom, the Company’s Chief Financial Officer (the “Nystrom Employment Agreement”) to provide that, if Mr. Nystrom resigns his employment with the Company, with or without Good Reason (as defined in the Nystrom Employment Agreement) and he reasonably cooperates with the Company and is reasonably available to the Company with respect to matters arising out of his service to the Company, the Committee may, in its sole discretion, provide Mr. Nystrom with a cash payment in an amount up to $2,000,000 in return for, and at the time of, his cooperation. 

The descriptions of the CEO Special Option Grant, amended and restated Annual Option Grants, Annual RSU Grants, and Special Transition Grants, and the Nystrom Amendment are meant to be a summary and not a full description of all of the terms of such agreements, which are incorporated herein by reference. Copies of the agreements are attached as Exhibits 10.1 through 10.6 to this Quarterly Report on Form 10-Q and incorporated herein by reference.

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ITEM 6.  EXHIBITS

(a)  Exhibits

The following exhibits are filed or furnished as a part of this report:

Exhibit Number	Description of Exhibit
*†10.1	At Home Group Inc. Form of Notice of Grant and Nonqualified Stock Option Agreement (CEO Special Option Grant).
*†10.2	At Home Group Inc. Form of Notice of Grant and Nonqualified Stock Option Agreement (Time-Vesting) – Annual Grant.
*†10.3	At Home Group Inc. Form of Notice of Grant and Restricted Stock Unit Agreement – Annual Grant.
*†10.4	At Home Group Inc. Form of Notice of Grant and Nonqualified Stock Option Agreement (Special Transition Grant).
*†10.5	At Home Group Inc. Form of Notice of Grant and Restricted Stock Unit Agreement (Director) – Annual Grant.
*†10.6	Amendment to Employment Agreement by and between At Home RMS Inc. and Judd Nystrom, dated as of June 7, 2018.
*31.1	Certification of Chief Executive Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
*31.2	Certification of Chief Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
*32.1	Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
*101.INS	XBRL Instance Document.
*101.SCH	XBRL Taxonomy Extension Schema Document.
*101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document.
*101.DEF	XBRL Taxonomy Extension Definition Linkbase Document.
*101.LAB	XBRL Taxonomy Extension Label Linkbase Document.
*101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document.

*Filed herewith.

†Indicates management contracts or compensatory plans or arrangements in which our executive officers or directors participate.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	AT HOME GROUP INC.
June 7, 2018	/s/ LEWIS L. BIRD III
	By:	Lewis L. Bird III
		Chairman of the Board and Chief Executive Officer (Principal Executive Officer)
June 7, 2018	/s/ JUDD T. NYSTROM
	By:	Judd T. Nystrom
		Chief Financial Officer (Principal Financial Officer)

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EX-10.1

Exhibit 10.1

FORM OF AT HOME GROUP INC. 2016 EQUITY INCENTIVE PLAN

NONSTATUTORY STOCK OPTION - Notice of Grant

(CEO SPECIAL GRANT)

At Home Group Inc. (the “Company”), a Delaware corporation, hereby grants to the Optionee set forth below (the “Optionee”) an option (the “Option”) to purchase the number of Shares of common stock of the Company (“Shares”) set forth below at the Option Price set forth below, pursuant to the terms and conditions of this Notice of Grant (the “Notice”), the Nonstatutory Stock Option Award Agreement (reference number 2018-C)  attached hereto as Exhibit A (the “Award Agreement”), and the At Home Group Inc. 2016 Equity Incentive Plan (the “Plan”).

Date of Grant:	[], 2018
Name of Optionee:	Lewis L. Bird III
Number of Shares Subject to Option:	[]1 Shares
Option Price (Price per Share):	$[]2 per Share
Expiration Date:	7  year anniversary of the Date of Grant
Vesting:	The Option shall be fully vested and exercisable as of the Date of Grant.  The Shares deliverable upon exercise of the Option shall be subject to the terms and conditions set forth in Section 3 of the Award Agreement.

The Option shall be subject to the execution and return of this Notice by the Optionee to the Company within 30 days of the date hereof (including by utilizing an electronic signature and/or web-based approval and notice process or any other process as may be authorized by the Company). This Option is a non-qualified stock option and is not intended by the parties hereto to be, and shall not be treated as, an “incentive stock option” within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended. Capitalized terms used but not defined herein shall have the meaning attributed to such terms in the Award Agreement or, if not defined therein, in the Plan, unless the context requires otherwise.  By executing this Notice, the Optionee acknowledges that his or her agreement to the covenants set forth in Section 7 of the Award Agreement is a material inducement to the Company in granting this Award to the Optionee.

This Notice may be executed by facsimile or electronic means (including, without limitation, PDF) and in one or more counterparts, each of which shall be considered an original instrument, but all of which together shall constitute one and the same agreement, and shall become binding when one or more counterparts have been signed by each of the parties hereto and delivered to the other party hereto.

[Signature Page Follows]

1    Amount to equal (i) 1,500,000 shares,  plus (ii) an additional number of options having a fair value (as estimated using the Black Scholes pricing model) as of June 12, 2018 equal to the product of (x) 1,500,000 and (y) the excess of the Fair Market Value of a Share on June 12, 2018 over $31.56.

2To equal the Fair Market Value of a Share on June 12, 2018.

IN WITNESS WHEREOF, the parties hereto have executed this Notice of Grant as of the Date of Grant set forth above.

AT HOME GROUP INC.
By:
Name:
Title:
OPTIONEE
Name:	Lewis L. Bird III

[Signature Page to Notice of Grant for At Home Group Inc. 2016 Equity Incentive Plan Nonqualified Stock Option (CEOSpecial Grant)]

Exhibit A

AT HOME GROUP INC.

2016 EQUITY INCENTIVE PLAN

NON-STATUTORY STOCK OPTION

Award Agreement

(CEO SPECIAL GRANT)

Reference Number: 2018-C

THIS NONSTATUTORY STOCK OPTION AWARD AGREEMENT (the “Award Agreement”) is entered into by and among At Home Group Inc. (the “Company”) and the individual set forth on the signature page to that certain Notice of Grant (the “Notice”) to which this Award Agreement is attached.  The terms and conditions of the Option granted hereby, to the extent not controlled by the terms and conditions contained in the Plan, shall be as set forth in the Notice and this Award Agreement.    Capitalized terms used but not defined herein shall have the meaning attributed to such terms in the Notice or, if not defined therein, in the Plan, unless the context requires otherwise.

1.        No Right to Continued Employee Status or Consultant Service

Nothing contained in this Award Agreement shall confer upon the Optionee the right to the continuation of his or her Employee status, or, in the case of a Consultant or Director, to the continuation of his or her service arrangement, or in either case to interfere with the right of the Company or any of its Subsidiaries or other Affiliates to Terminate the Optionee.

2.       Term of Option

As a general matter, the Option will expire on the Expiration Date set forth in the Notice and be deemed to have been forfeited by the Optionee. As provided below, the Optionee’s right to exercise the Option may expire prior to the Expiration Date if the Optionee Terminates, including in the event of the Optionee’s Disability or death. This Award Agreement shall remain in effect until the Option has fully been exercised or any unexercised portion thereof has been forfeited by the Optionee and the transfer restrictions on the Option Shares have lapsed, in each case, as provided in this Award Agreement. No portion of this Option shall be exercisable after the Expiration Date, or such earlier date as may be applicable, except as provided herein.

3.        Vesting of Option; Transfer Restrictions on Option Shares 

(a) The Option shall be fully vested as of the Date of Grant. 

(b) To the extent the Optionee chooses to exercise the Option in accordance with Section 4, the Optionee agrees that, during the Transfer Restriction Period, unless otherwise required by law, the Shares delivered upon exercise of the Option (the “Option Shares”) shall not be sold, transferred or otherwise disposed of, pledged or otherwise hypothecated or subject to attachment, execution or levy of any kind, other than by will or by the laws of descent or distribution; provided,  however, that any transferred Option Shares will be subject to all of the

same terms and conditions as provided in the Plan and this Award Agreement and the Optionee’s estate or beneficiary appointed in accordance with the Plan will remain liable for any withholding tax that may be imposed by any federal, state or local tax authority.  For purposes of this Agreement, the “Transfer Restriction Period” shall mean the period beginning on the Date of Grant and ending on the earliest of (i) (A) the fourth (4th) anniversary of the Date of Grant, if the Optionee does not experience a Termination prior to such fourth (4th) anniversary, and (B) the eighth (8th) anniversary of the Date of Grant, if the Optionee experiences a Termination (other than a Severance Event) prior to the fourth (4th) anniversary of the Date of Grant, (ii) the date on which the Optionee experiences a Termination under circumstances constituting a Severance Event (as defined below), and (iii) the date on which a Change in Control is consummated.  For purposes of this Award Agreement, a “Severance Event” means the Optionee’s Termination without “Cause”, resignation for “Good Reason” (as such terms are defined in the Optionee’s employment agreement with the Company or one of its Subsidiaries in effect as of the date of such Severance Event), or due to death or Disability.

4.        Exercise 

Prior to the Expiration Date and at any time prior to the Optionee’s Termination, the Optionee may exercise all or a portion of the Option by giving notice in the form, to the person, and using the administrative method and the exercise procedures established by the Committee from time to time (including any procedures utilizing an electronic signature and/or web-based approval and notice process), specifying the number of Option Shares to be acquired. The Optionee’s right to exercise the Option following the date of the Optionee’s Termination will depend on the reason for such Termination, as described in Section 5 below.

The Optionee must pay to the Company at the time of exercise the amount of the Option Price for the number of Shares covered by the notice to exercise (“Aggregate Option Price”). The Aggregate Option Price for any Shares purchased pursuant to the exercise of an Option shall be paid in any or any combination of the following forms: (w) cash or its equivalent (e.g., a check);  (x) if and to the extent that the transfer restrictions set forth in Section  3‎(b) above have lapsed with respect to the Option Shares, by making arrangements with respect to such Option Shares through a registered broker-dealer pursuant to cashless exercise procedures established by the Committee from time to time; (y) if permitted by the Committee in its sole discretion, the transfer, either actually or by attestation, to the Company of Shares that have been held by the Optionee for at least six (6) months (or such lesser period as may be permitted by the Committee) prior to the exercise of the Option, such transfer to be upon such terms and conditions as determined by the Committee; or (z) in the form of other property as determined by the Committee in its sole discretion. Any Shares transferred to the Company as payment of the exercise price under an Option shall be valued at their Fair Market Value on the last business day preceding the date of exercise of such Option. In addition, at the discretion of the Committee in its sole discretion at the time of exercise, the Optionee may provide for the payment of the Aggregate Option Price through Share withholding as a result of which the number of Shares issued upon exercise of an Option would be reduced by a number of Shares having a Fair Market Value equal to the Aggregate Option Price. If requested by the Committee, the Optionee shall deliver this Award Agreement to the Company, which shall endorse thereon a notation of such exercise and return such Award Agreement to the Optionee. No fractional Shares (or cash in lieu thereof) shall be issued upon

exercise of an Option and the number of Shares that may be purchased upon exercise shall be rounded down to the nearest number of whole Shares.

5.        Termination of Service; Repurchase of Option Shares

(a) Except as otherwise provided in Sections  5‎(b) and ‎(c) below, if the Optionee incurs a Termination, then the portion of this Option that has not been exercised shall remain exercisable until, and shall terminate upon, the first to occur of (i) the end of the day that is ninety (90) days following the date of the Optionee’s Termination or, (ii) the Expiration Date.

(b) If the Optionee incurs a Termination by reason of death or Disability, the Option shall remain exercisable until, and shall terminate upon, the first to occur of (i) the end of the day that is one (1) year after the date of the Optionee’s Termination for death or Disability, as applicable, or (ii) the Expiration Date of the Option.  Until such termination of the Option, the Option may, to the extent that this Option has not previously been exercised by the Optionee, be exercised by the Optionee in the case of his Disability, or, in the case of death, by the Optionee’s personal representative or the person entitled to the Optionee’s rights under this Award Agreement. 

(c) If the Optionee incurs a Termination for Cause, then (i) this Option and all rights attached hereto shall be forfeited and terminate immediately upon the effective date of such Termination for Cause, and (ii) the Company may repurchase any or all Option Shares then held by the Optionee with respect to which the transfer restrictions set forth in Section  3‎(b) above have not yet lapsed (such repurchased Shares, the “Called Shares”) by delivering written notice to the Optionee of such repurchase and setting forth the number of Called Shares and the repurchase price of such Called Shares, which repurchase price shall equal the lesser of the Option Price per Share and the Fair Market Value per Called Share on the date of such written notice.  The closing of any such repurchase will take place at the principal office of the Company within fifteen (15) days following the date such repurchase notice is delivered, at which time the Optionee shall sell, convey, transfer, assign, and deliver to the Company all right, title, and interest in and to the Called Shares, which shall constitute (and at the closing, the Optionee shall represent, warrant, and certify the same to the Company in writing) good and unencumbered title to the Called Shares free and clear of all liens, security interests, encumbrances and adverse claims of any kind and nature (except pursuant to this Award Agreement), and hereby authorizes the Company to take any and all action necessary to reflect such transfer on the books and records of the Company, and the Company shall deliver to Optionee, in full payment of the purchase price for the Called Shares, either a wire transfer to an account designated by Optionee or a cashier’s, certified or official bank check payable to the order of Optionee (the method of payment at the Company’s discretion), in an amount equal to the aggregate purchase price of the Called Shares.  From and after the date notice of repurchase is delivered to the Optionee, the Optionee shall have no rights with respect to the Called Shares (including, without limitation, any rights to any dividends in respect thereof deferred pursuant to Section 6, which shall be forfeited without consideration), except to receive the purchase price therefor. 

6.        Dividend Rights

Upon the issuance of Option Shares and the entry of the Optionee’s name as a shareholder of record on the books of the Company, the Optionee shall be, until such time as the Optionee ceases to be the holder of such Option Shares, entitled to all rights of a common shareholder of the Company, including, without limitation, the right to receive all dividends or other distributions paid or made with respect thereto;  provided,  however, that any entitlement to or payment of dividends or distributions declared or paid on Option Shares (other than the minimum amount of such dividend or distribution necessary to cover applicable taxes due in respect of such dividend or distribution) shall be deferred until such date the transfer restrictions in respect of the applicable Option Shares in respect of which such dividends or distributions were made lapse pursuant to this Award Agreement.  Any such deferred dividends shall be held by the Company for the account of the Optionee and, subject to Sections 5 and 7, shall be paid to the Optionee, with no interest thereon, as promptly as practicable following the date on which the transfer restrictions in respect of the Option Shares in respect of which such dividends or distributions were made lapse pursuant to this Award Agreement.

7.        Prohibited Activities 

(a)     No Sale or Transfer. Unless otherwise required by law, this Option shall not be (i) sold, transferred or otherwise disposed of, (ii) pledged or otherwise hypothecated or (iii) subject to attachment, execution or levy of any kind, other than by will or by the laws of descent or distribution; provided,  however, that any transferred Option will be subject to all of the same terms and conditions as provided in the Plan and this Award Agreement and the Optionee’s estate or beneficiary appointed in accordance with the Plan will remain liable for any withholding tax that may be imposed by any federal, state or local tax authority.

(b)     Right to Terminate Option and Recovery of Option Shares.  The Optionee understands and agrees that the Company has granted this Option to the Optionee to reward the Optionee for the Optionee’s future efforts and loyalty to the Company and its Affiliates by giving the Optionee the opportunity to participate in the potential future appreciation of the Company.  Accordingly, if (i) the Optionee materially violates the Optionee’s obligations relating to the non-disclosure or non-use of confidential or proprietary information under any Restrictive Agreement to which the Optionee is a party, or (ii) the Optionee materially breaches or violates the Optionee’s obligations relating to non-disparagement under any Restrictive Agreement to which the Optionee is a party, or (iii) the Optionee engages in any activity prohibited by Section 7 of this Award Agreement, or (iv) the Optionee materially breaches or violates any non-solicitation obligations under any Restrictive Agreement to which the Optionee is a party, or (v) the Optionee materially breaches or violates any non-competition obligations under any Restrictive Agreement to which the Optionee is a party, or (vi) the Optionee is convicted of a felony against the Company or any of its Affiliates, then, in addition to any other rights and remedies available to the Company, the Company shall be entitled, at its option, exercisable by written notice, to (x) terminate the Option (including the vested portion of the Option), or any unexercised portion thereof, which shall be of no further force and effect, and (y) repurchase any or all Option Shares then held by the Optionee with respect to which the transfer restrictions set forth in Section  3‎(b) above have not yet lapsed, in the manner set forth in Section 5 above.  “Restrictive Agreement” shall mean any agreement between the Company or any Subsidiary and the Optionee (including

any prior option agreement) that contains non-competition, non-solicitation, non-hire, non-disparagement, or confidentiality restrictions applicable to the Optionee. 

(c)      Other Remedies. The Optionee specifically acknowledges and agrees that its remedies under this Section 7 shall not prevent the Company or any Subsidiary from seeking injunctive or other equitable relief in connection with the Optionee’s breach of any Restrictive Agreement.  In the event that the provisions of this Section 7 should ever be deemed to exceed the limitation provided by applicable law, then the Optionee and the Company agree that such provisions shall be reformed to set forth the maximum limitations permitted. 

8.        No Rights as Stockholder

The Optionee shall have no rights as a stockholder with respect to the Shares covered by any exercise of this Option until the effective date of issuance of the Shares and the entry of the Optionee’s name as a shareholder of record on the books of the Company following exercise of this Option.

9.        Taxation upon Exercise of Option; Tax Withholding;  Section 83(b) Election

(a)     Taxation upon Exercise of Option.The Optionee understands that, upon exercise of this Option, the Optionee will recognize income, for Federal, state and local income tax purposes, as applicable, in an amount equal to the amount by which the Fair Market Value of the Option Shares, determined as of the date of exercise, exceeds the Option Price. The acceptance of the Option Shares by the Optionee shall constitute an agreement by the Optionee to report such income in accordance with then applicable law and to cooperate with Company and its subsidiaries in establishing the amount of such income and corresponding deduction to the Company and/or its subsidiaries for its income tax purposes.

(b)     Tax Withholding.The Optionee is responsible for all tax obligations that arise as a result of the exercise of this Option, the delivery of Option Shares, and the lapsing of transfer restrictions in respect of Option Shares.  The delivery of certificates or evidence of book entry registration representing Option Shares to the Optionee shall be subject to the satisfaction of such obligations.   The Company may withhold from any amount payable to the Optionee an amount sufficient to cover any Federal, state or local withholding taxes which may become required with respect to such exercise, delivery, and/or lapsing of restrictions, or take any other action it deems necessary to satisfy any income or other tax withholding requirements as a result thereof. The Company shall have the right to require the payment of any such taxes and require that the Optionee, or the Optionee’s beneficiary, to furnish information deemed necessary by the Company to meet any tax reporting obligation as a condition to exercise or before the issuance of any Shares pursuant to this Option or the delivery of certificates or evidence of book entry registration representing Option Shares. The Optionee may pay his or her withholding tax obligation by making (w) a cash payment to the Company, or (x) if and to the extent that the transfer restrictions set forth in Section  3‎(b) above have lapsed with respect to the Option Shares, arrangements with respect to such Option Shares through a registered broker-dealer pursuant to cashless exercise procedures established by the Committee from time to time.  In addition, the Committee, in its sole discretion, may allow the Optionee to pay his or her withholding tax

obligation in connection with the exercise of the Option, by (y) having withheld a portion of the Shares then issuable to him or her upon exercise of the Option or (z) surrendering Shares that have been held by the Optionee for at least six (6) months (or such lesser period as may be permitted by the Committee) prior to the exercise of the Award, in each case having an aggregate Fair Market Value equal to the withholding taxes.

(c)     Section 83(b) Election.  If the Optionee makes an election pursuant to Section 83(b) of the Code concerning the Option Shares deliverable upon exercise of the Option, the Optionee shall be required to file promptly a copy of such election with the Company.

10.       Securities Laws; Tolling of Exercise Period Expiration

(a)     Upon the acquisition of any Shares pursuant to the exercise of the Option, the Optionee will make such written representations, warranties, and agreements as the Committee may reasonably request in order to comply with securities laws or with this Award Agreement. Optionee hereby agrees not to offer, sell or otherwise attempt to dispose of any Shares issued to the Optionee upon exercise of the Option in any way which would: (x) require the Company to file any registration statement with the Securities and Exchange Commission (or any similar filing under state law or the laws of any other county) or to amend or supplement any such filing or (y) violate or cause the Company to violate the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, the rules and regulations promulgated thereunder, or any other Federal, state or local law, or the laws of any other country. The Company reserves the right to place restrictions (in addition to those restrictions described in Section  3‎(b) above) on any Shares the Optionee may receive as a result of the exercise of the Option.

(b)     Notwithstanding any provision contained in this Award Agreement or the Plan to the contrary,

(i) if, following the Optionee’s Termination, all or a portion of the exercise period applicable to the Option occurs during a time when the Optionee cannot exercise the Option without violating (w) an applicable Federal, state or local law, (x) the rules related to a blackout period declared by the Company, (y) any agreed to lock-up arrangement, or (z) other similar circumstance, in each case, the exercise period applicable to the Option will be tolled for the number of days that such prohibitions or restrictions apply, such that the exercise period will be extended by the same number of days as were subject to the prohibitions or restrictions; provided,  however, that the exercise period may not be extended due to such tolling past the Expiration Date of the Option as set forth above; and

(ii) if the Expiration Date is set to occur during a time that the Optionee cannot exercise the Option without violating an applicable Federal, state or local law (and the Option has not previously been exercised or otherwise terminated), the exercise period will be tolled until such time as the violation would no longer apply; provided,  however, that the exercise period applicable to the Option in this event will be fifteen (15) days from the date such potential violation is longer applicable.

11.       Modification, Extension and Renewal of Options

This Award Agreement may not be modified, amended, terminated and no provision hereof may be waived in whole or in part except by a written agreement signed by the Company and the Optionee and no modification shall, without the consent of the Optionee, alter to the Optionee’s material detriment or materially impair any rights of the Optionee under this Award Agreement except to the extent permitted under the Plan.

12.       Notices

Unless otherwise provided herein, any notices or other communication given or made pursuant to the Notice, this Award Agreement or the Plan shall be in writing and shall be deemed to have been duly given (i) as of the date delivered, if personally delivered (including receipted courier service) or overnight delivery service, with confirmation of receipt; (ii) on the date the delivering party receives confirmation, if delivered by facsimile to the number indicated or by email to the address indicated or through an electronic administrative system designated by the Company; (iii) one (1) business day after being sent by reputable commercial overnight delivery service courier, with confirmation of receipt; or (iv) three (3) business days after being mailed by registered or certified mail, return receipt requested, postage prepaid and addressed to the intended recipient as set forth below:

(a) If to the Company at the address below:

At Home Group Inc.

1600 East Plano Parkway

Plano, Texas 75074

Attn: General Counsel

Phone:  (972) 265-6227

(b) If to the Optionee, at the most recent address, facsimile number or email contained in the Company’s records.

13.       Award Agreement Subject to Plan and Applicable Law

This Option is made pursuant to the Plan and shall be interpreted to comply therewith. A copy of the Plan is attached hereto. Any provision of this Option inconsistent with the Plan shall be considered void and replaced with the applicable provision of the Plan. The Plan shall control in the event there shall be any conflict between the Plan, the Notice, and this Award Agreement, and it shall control as to any matters not contained in this Award Agreement. The Committee shall have authority to make constructions of this Award Agreement, and to correct any defect or supply any omission or reconcile any inconsistency in this Award Agreement, and to prescribe rules and regulations relating to the administration of this Award and other Awards granted under the Plan.

This Option shall be governed by the laws of the State of Delaware, without regard to the conflicts of law principles thereof, and subject to the exclusive jurisdiction of the courts therein. The Optionee hereby consents to personal jurisdiction in any action brought in any court, federal or state, within the State of Delaware having subject matter jurisdiction in the matter.

14.       Headings and Capitalized Terms

Unless otherwise provided herein, capitalized terms used herein that are defined in the Plan and not defined herein shall have the meanings set forth in the Plan. Headings are for convenience only and are not deemed to be part of this Award Agreement. Unless otherwise indicated, any reference to a Section herein is a reference to a Section of this Award Agreement.

15.       Severability and Reformation

If any provision of this Award Agreement shall be determined by a court of law of competent jurisdiction to be unenforceable for any reason, such unenforceability shall not affect the enforceability of any of the remaining provisions hereof; and this Award Agreement, to the fullest extent lawful, shall be reformed and construed as if such unenforceable provision, or part thereof, had never been contained herein, and such provision or part thereof shall be reformed or construed so that it would be enforceable to the maximum extent legally possible.

16.       Binding Effect

This Award Agreement shall be binding upon the parties hereto, together with their personal executors, administrator, successors, personal representatives, heirs and permitted assigns.

17.       Entire Agreement

This Award Agreement, together with the Plan, supersedes all prior written and oral agreements and understandings among the parties as to its subject matter and constitutes the entire agreement of the parties with respect to the subject matter hereof.  If there is any conflict between the Notice, this Award Agreement and the Plan, then the applicable terms of the Plan shall govern.

18.       Waiver

Waiver by any party of any breach of this Award Agreement or failure to exercise any right hereunder shall not be deemed to be a waiver of any other breach or right whether or not of the same or a similar nature. The failure of any party to take action by reason of such breach or to exercise any such right shall not deprive the party of the right to take action at any time while or after such breach or condition giving rise to such rights continues.

EX-10.2

Exhibit 10.2

FORM OF AT HOME GROUP INC. 2016 EQUITY INCENTIVE PLAN

NONSTATUTORY STOCK OPTION - Notice of Grant

At Home Group Inc. (the “Company”), a Delaware corporation, hereby grants to the Optionee set forth below (the “Optionee”) an option (the “Option”) to purchase the number of Shares of common stock of the Company (“Shares”) set forth below at the Option Price set forth below, pursuant to the terms and conditions of this Notice of Grant (the “Notice”), the Nonstatutory Stock Option Award Agreement (reference number 20[__]1-[__]2)  attached hereto as Exhibit A (the “Award Agreement”), and the At Home Group Inc. 2016 Equity Incentive Plan (the “Plan”).

Date of Grant:	[●]
Name of Optionee:	[●]
Number of Shares Subject to Option:	[●] Shares
Option Price
(Price per Share):	$[●]3 per Share
Expiration Date:	7 year anniversary of the Date of Grant
Vesting:	The Option shall vest pursuant to the terms and conditions set forth in Section 3 of the Award Agreement.
Vesting Start Date:	[●]

The Option shall be subject to the execution and return of this Notice by the Optionee to the Company within 30 days of the date hereof (including by utilizing an electronic signature and/or web-based approval and notice process or any other process as may be authorized by the Company). This Option is a non-qualified stock option and is not intended by the parties hereto to be, and shall not be treated as, an “incentive stock option” within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended. Capitalized terms used but not defined herein shall have the meaning attributed to such terms in the Award Agreement or, if not defined therein, in the Plan, unless the context requires otherwise.  By executing this Notice, the Optionee acknowledges that his or her agreement to the covenants set forth in Section 7 of the Award Agreement is a material inducement to the Company in granting this Award to the Optionee.

This Notice may be executed by facsimile or electronic means (including, without limitation, PDF) and in one or more counterparts, each of which shall be considered an original instrument, but all of which together shall constitute one and the same agreement, and shall become binding when one or more counterparts have been signed by each of the parties hereto and delivered to the other party hereto.

[Signature Page Follows]

1To be updated as necessary to be consistent with the referenced award agreement to which the notice relates.

2To be updated as necessary to be consistent with the referenced award agreement to which the notice relates.

3Option Price to equal fair market value per Share on Date of Grant.

IN WITNESS WHEREOF, the parties hereto have executed this Notice of Grant as of the Date of Grant set forth above.

AT HOME GROUP INC.

By:

Name:

Title:

OPTIONEE

Name:

[Signature Page to Notice of Grant for At Home Group Inc. 2016 Equity Incentive Plan Nonqualified Stock Option]

Exhibit A

AT HOME GROUP INC.

2016 EQUITY INCENTIVE PLAN

NON-STATUTORY STOCK OPTION

Award Agreement

Reference Number: 20[__]4-[__]5

THIS NONSTATUTORY STOCK OPTION AWARD AGREEMENT (the “Award Agreement”) is entered into by and among At Home Group Inc. (the “Company”) and the individual set forth on the signature page to that certain Notice of Grant (the “Notice”) to which this Award Agreement is attached.  The terms and conditions of the Option granted hereby, to the extent not controlled by the terms and conditions contained in the Plan, shall be as set forth in the Notice and this Award Agreement.    Capitalized terms used but not defined herein shall have the meaning attributed to such terms in the Notice or, if not defined therein, in the Plan, unless the context requires otherwise.

1.No Right to Continued Employee Status or Consultant Service

Nothing contained in this Award Agreement shall confer upon the Optionee the right to the continuation of his or her Employee status, or, in the case of a Consultant or Director, to the continuation of his or her service arrangement, or in either case to interfere with the right of the Company or any of its Subsidiaries or other Affiliates to Terminate the Optionee.

2.Term of Option

As a general matter, the Option will expire on the Expiration Date set forth in the Notice and be deemed to have been forfeited by the Optionee. As provided below, the Optionee’s right to exercise the Option may expire prior to the Expiration Date if the Optionee Terminates, including in the event of the Optionee’s Disability or death. This Award Agreement shall remain in effect until the Option has fully vested and been exercised or any unexercised portion thereof has been forfeited by the Optionee as provided in this Award Agreement. No portion of this Option shall be exercisable after the Expiration Date, or such earlier date as may be applicable, except as provided herein.

3.Vesting of Option 

Subject to the remainder of this Section ‎0,  the Option will vest in accordance with the following schedule, with the Option becoming fully (100%) vested as of the [●] anniversary of the Vesting Start Date, subject to the Optionee not having Terminated as of the applicable vesting date:

4To be updated as appropriate.

5To be updated as appropriate.

Vesting Percentage	Vesting Date
[●]%6	[●]6

If the Optionee Terminates for any reason, the portion of the Option that has not vested as of such date shall terminate upon such Termination and be deemed to have been forfeited by the Optionee without consideration.  

Notwithstanding the foregoing, the Option, to the extent then issued, outstanding, and unexercised, shall become fully (100%) vested upon the Optionee’s Termination by the Company without Cause or by the Optionee’s resignation for Good Reason, in either case, on or within one year following the consummation of a Change in Control.  For purposes of this Agreement “Good Reason” shall mean (a) if the Optionee is party to an employment or a severance agreement with the Company or one of the Subsidiaries in which “Good Reason” is defined, the occurrence of any circumstances defined as “Good Reason” in such employment or severance agreement, or (b) if the Optionee is not party to an employment or severance agreement with the Company or one of the Subsidiaries in which “Good Reason” is defined, (i) a material reduction in the Optionee’s annual base salary or compensation (including target annual bonus opportunity), or (ii) any material and adverse change in the Optionee’s position, title or status or any change in the Optionee’s job duties, authority or responsibilities to those of lesser status.  A termination of employment by the Optionee for Good Reason shall be effectuated by giving the Company written notice of the termination, setting forth the conduct of the Company that constitutes Good Reason, within 30 days of the first date on which the Optionee has knowledge of such conduct.  The Optionee shall further provide the Company at least 30 days following the date on which such notice is provided to cure such conduct.  Failing such cure, a termination of employment by the Optionee for Good Reason shall be effective on the day following the expiration of such cure period.

4.Exercise

Prior to the Expiration Date and at any time prior to the Optionee’s Termination, the Optionee may exercise all or a portion of the Option, to the extent vested, by giving notice in the form, to the person, and using the administrative method and the exercise procedures established by the Committee from time to time (including any procedures utilizing an electronic signature and/or web-based approval and notice process), specifying the number of Shares to be acquired. The Optionee’s right to exercise the vested portion of the Option following the date that of the Optionee’s Termination will depend on the reason for such Termination, as described in Sections ‎0 and ‎0 below.

The Optionee must pay to the Company at the time of exercise the amount of the Option Price for the number of Shares covered by the notice to exercise (“Aggregate Option Price”). The Aggregate Option Price for any Shares purchased pursuant to the exercise of an Option shall be paid in any or any combination of the following forms: (w) cash or its equivalent (e.g., a check);  (x) by making arrangements through a registered broker-dealer pursuant to cashless exercise procedures established by the Committee from time to time; (y) if permitted by the Committee in its sole

6The schedule of vesting date(s) and percentages of the Option vesting as of each vesting date shall be determined by the Committee at the time of grant.

discretion, the transfer, either actually or by attestation, to the Company of Shares that have been held by the Optionee for at least six (6) months (or such lesser period as may be permitted by the Committee) prior to the exercise of the Option, such transfer to be upon such terms and conditions as determined by the Committee; or (z) in the form of other property as determined by the Committee in its sole discretion. Any Shares transferred to the Company as payment of the exercise price under an Option shall be valued at their Fair Market Value on the last business day preceding the date of exercise of such Option. In addition, at the discretion of the Committee in its sole discretion at the time of exercise, the Optionee may provide for the payment of the Aggregate Option Price through Share withholding as a result of which the number of Shares issued upon exercise of an Option would be reduced by a number of Shares having a Fair Market Value equal to the Aggregate Option Price. If requested by the Committee, the Optionee shall deliver this Award Agreement to the Company, which shall endorse thereon a notation of such exercise and return such Award Agreement to the Optionee. No fractional Shares (or cash in lieu thereof) shall be issued upon exercise of an Option and the number of Shares that may be purchased upon exercise shall be rounded down to the nearest number of whole Shares.

5.Termination of Service 

If the Optionee incurs a Termination for any reason, whether voluntarily or involuntarily, without Cause, other than as a result of the Optionee’s death or Disability, then the portion of this Option that has previously vested but has not been exercised shall remain exercisable until, and shall terminate upon, the first to occur of (a) the end of the day that is ninety (90) days following the date of the Optionee’s Termination or, (b) the Expiration Date. If the Optionee incurs a Termination for Cause, then this Option and all rights attached hereto shall be forfeited and terminate immediately upon the effective date of such Termination for Cause.

6.Death or Disability of the Optionee 

Upon the Optionee’s Termination by reason of death or Disability, the vested portion of the Option shall remain exercisable until, and shall terminate upon, the first to occur of (a) the end of the day that is one (1) year after the date of the Optionee’s Termination for death or Disability, as applicable, or (b) the Expiration Date of the Option.  Until such termination of the Option, the vested portion of the Option may, to the extent that this Option has not previously been exercised by the Optionee, be exercised by the Optionee in the case of his or her Disability, or, in the case of death, by the Optionee’s personal representative or the person entitled to the Optionee’s rights under this Award Agreement.

7.Prohibited Activities 

(a)        No Sale or Transfer. Unless otherwise required by law, this Option shall not be (i) sold, transferred or otherwise disposed of, (ii) pledged or otherwise hypothecated or (iii) subject to attachment, execution or levy of any kind, other than by will or by the laws of descent or distribution; provided,  however, that any transferred Option will be subject to all of the same terms and conditions as provided in the Plan and this Award Agreement and the Optionee’s estate or beneficiary appointed in accordance with the Plan will remain liable for any withholding tax that may be imposed by any federal, state or local tax authority.

(b)        Right to Terminate Option and Recovery.  The Optionee understands and agrees that the Company has granted this Option to the Optionee to reward the Optionee for the Optionee’s future efforts and loyalty to the Company and its Affiliates by giving the Optionee the opportunity to participate

in the potential future appreciation of the Company.  Accordingly, if (a) the Optionee materially violates the Optionee’s obligations relating to the non-disclosure or non-use of confidential or proprietary information under any Restrictive Agreement to which the Optionee is a party, or (b) the Optionee materially breaches or violates the Optionee’s obligations relating to non-disparagement under any Restrictive Agreement to which the Optionee is a party, or (c) the Optionee engages in any activity prohibited by Section 7 of this Award Agreement, or (d) the Optionee materially breaches or violates any non-solicitation obligations under any Restrictive Agreement to which the Optionee is a party, or (e) the Optionee breaches or violates any non-competition obligations under any Restrictive Agreement to which the Optionee is a party, or (f) the Optionee is convicted of a felony against the Company or any of its Affiliates, then, in addition to any other rights and remedies available to the Company, the Company shall be entitled, at its option, exercisable by written notice, to terminate the Option (including the vested portion of the Option), or any unexercised portion thereof, which shall be of no further force and effect.  “Restrictive Agreement” shall mean any agreement between the Company or any Subsidiary and the Optionee (including any prior option agreement) that contains non-competition, non-solicitation, non-hire, non-disparagement, or confidentiality restrictions applicable to the Optionee. 

(c)        Other Remedies. The Optionee specifically acknowledges and agrees that its remedies under this Section 7 shall not prevent the Company or any Subsidiary from seeking injunctive or other equitable relief in connection with the Optionee’s breach of any Restrictive Agreement.  In the event that the provisions of this Section 7 should ever be deemed to exceed the limitation provided by applicable law, then the Optionee and the Company agree that such provisions shall be reformed to set forth the maximum limitations permitted. 

8.No Rights as Stockholder

The Optionee shall have no rights as a stockholder with respect to the Shares covered by any exercise of this Option until the effective date of issuance of the Shares and the entry of the Optionee’s name as a shareholder of record on the books of the Company following exercise of this Option.

9.Taxation Upon Exercise of Option; Tax Withholding; Parachute Tax Provisions

The Optionee understands that, upon exercise of this Option, the Optionee will recognize income, for Federal, state and local income tax purposes, as applicable, in an amount equal to the amount by which the Fair Market Value of the Shares, determined as of the date of exercise, exceeds the Option Price. The acceptance of the Shares by the Optionee shall constitute an agreement by the Optionee to report such income in accordance with then applicable law and to cooperate with Company and its subsidiaries in establishing the amount of such income and corresponding deduction to the Company and/or its subsidiaries for its income tax purposes.

The Optionee is responsible for all tax obligations that arise as a result of the exercise of this Option. The Company may withhold from any amount payable to the Optionee an amount sufficient to cover any Federal, state or local withholding taxes which may become required with respect to such exercise or take any other action it deems necessary to satisfy any income or other tax withholding requirements as a result of the exercise this Option. The Company shall have the right to require the payment of any such taxes and require that the Optionee, or the Optionee’s beneficiary, to furnish information deemed necessary by the Company to meet any tax reporting obligation as a condition to exercise or before the issuance of any Shares pursuant to this Option. The Optionee may pay his or her withholding tax obligation in connection with the exercise of the Option, by making (w) a cash payment to the Company, or (x)  arrangements through a registered broker-dealer pursuant to cashless exercise procedures established by the Committee

from time to time.  In addition, the Committee, in its sole discretion, may allow the Optionee, to pay his or her withholding tax obligation in connection with the exercise of the Option, by (y) having withheld a portion of the Shares then issuable to him or her upon exercise of the Option or (z) surrendering Shares that have been held by the Optionee for at least six (6) months (or such lesser period as may be permitted by the Committee) prior to the exercise of the Award, in each case having an aggregate Fair Market Value equal to the withholding taxes.  

In connection with the grant of this Option, the parties wish to memorialize their agreement regarding the treatment of any potential golden parachute payments as set forth in Exhibit A attached hereto.

10.Securities Laws; Tolling of Exercise Period Expiration

(a)        Upon the acquisition of any Shares pursuant to the exercise of the Option, the Optionee will make such written representations, warranties, and agreements as the Committee may reasonably request in order to comply with securities laws or with this Award Agreement. Optionee hereby agrees not to offer, sell or otherwise attempt to dispose of any Shares issued to the Optionee upon exercise of the Option in any way which would: (x) require the Company to file any registration statement with the Securities and Exchange Commission (or any similar filing under state law or the laws of any other county) or to amend or supplement any such filing or (y) violate or cause the Company to violate the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, the rules and regulations promulgated thereunder, or any other Federal, state or local law, or the laws of any other country. The Company reserves the right to place restrictions on any Shares the Optionee may receive as a result of the exercise of the Option.

(b)        Notwithstanding any provision contained in this Award Agreement or the Plan to the contrary,

(i)        if, following the Optionee’s Termination, all or a portion of the exercise period applicable to the Option occurs during a time when the Optionee cannot exercise the Option without violating (w) an applicable Federal, state or local law, (x) the rules related to a blackout period declared by the Company, (y) any agreed to lock-up arrangement, or (z) other similar circumstance, in each case, the exercise period applicable to the Option will be tolled for the number of days that such prohibitions or restrictions apply, such that the exercise period will be extended by the same number of days as were subject to the prohibitions or restrictions; provided,  however, that the exercise period may not be extended due to such tolling past the Expiration Date of the Option as set forth above; and

(ii)        if the Expiration Date is set to occur during a time that the Optionee cannot exercise the Option without violating an applicable Federal, state or local law (and the Option has not previously been exercised or otherwise terminated), the exercise period will be tolled until such time as the violation would no longer apply; provided,  however, that the exercise period applicable to the Option in this event will be fifteen (15) days from the date such potential violation is longer applicable.

11.Modification, Extension and Renewal of Options

This Award Agreement may not be modified, amended, terminated and no provision hereof may be waived in whole or in part except by a written agreement signed by the Company and the Optionee and no modification shall, without the consent of the Optionee, alter to the Optionee’s material detriment or

materially impair any rights of the Optionee under this Award Agreement except to the extent permitted under the Plan.

12.Notices

Unless otherwise provided herein, any notices or other communication given or made pursuant to the Notice, this Award Agreement or the Plan shall be in writing and shall be deemed to have been duly given (i) as of the date delivered, if personally delivered (including receipted courier service) or overnight delivery service, with confirmation of receipt; (ii) on the date the delivering party receives confirmation, if delivered by facsimile to the number indicated or by email to the address indicated or through an electronic administrative system designated by the Company; (iii) one (1) business day after being sent by reputable commercial overnight delivery service courier, with confirmation of receipt; or (iv) three (3) business days after being mailed by registered or certified mail, return receipt requested, postage prepaid and addressed to the intended recipient as set forth below:

(a)        If to the Company at the address below:

At Home Group Inc.

1600 East Plano Parkway

Plano, Texas 75074

Attn: General Counsel

Phone:  (972) 265-6227

(b)        If to the Optionee, at the most recent address, facsimile number or email contained in the Company’s records.

13.Award Agreement Subject to Plan and Applicable Law

This Option is made pursuant to the Plan and shall be interpreted to comply therewith. A copy of the Plan is attached hereto. Any provision of this Option inconsistent with the Plan shall be considered void and replaced with the applicable provision of the Plan. The Plan shall control in the event there shall be any conflict between the Plan, the Notice, and this Award Agreement, and it shall control as to any matters not contained in this Award Agreement. The Committee shall have authority to make constructions of this Award Agreement, and to correct any defect or supply any omission or reconcile any inconsistency in this Award Agreement, and to prescribe rules and regulations relating to the administration of this Award and other Awards granted under the Plan.

This Option shall be governed by the laws of the State of Delaware, without regard to the conflicts of law principles thereof, and subject to the exclusive jurisdiction of the courts therein. The Optionee hereby consents to personal jurisdiction in any action brought in any court, federal or state, within the State of Delaware having subject matter jurisdiction in the matter.

14.Headings and Capitalized Terms

Unless otherwise provided herein, capitalized terms used herein that are defined in the Plan and not defined herein shall have the meanings set forth in the Plan. Headings are for convenience only and are not deemed to be part of this Award Agreement. Unless otherwise indicated, any reference to a Section herein is a reference to a Section of this Award Agreement.

15.Severability and Reformation

If any provision of this Award Agreement shall be determined by a court of law of competent jurisdiction to be unenforceable for any reason, such unenforceability shall not affect the enforceability of any of the remaining provisions hereof; and this Award Agreement, to the fullest extent lawful, shall be reformed and construed as if such unenforceable provision, or part thereof, had never been contained herein, and such provision or part thereof shall be reformed or construed so that it would be enforceable to the maximum extent legally possible.

16.Binding Effect

This Award Agreement shall be binding upon the parties hereto, together with their personal executors, administrator, successors, personal representatives, heirs and permitted assigns.

17.Entire Agreement

This Award Agreement, together with the Plan, supersedes all prior written and oral agreements and understandings among the parties as to its subject matter and constitutes the entire agreement of the parties with respect to the subject matter hereof.  If there is any conflict between the Notice, this Award Agreement and the Plan, then the applicable terms of the Plan shall govern.

18.Waiver

Waiver by any party of any breach of this Award Agreement or failure to exercise any right hereunder shall not be deemed to be a waiver of any other breach or right whether or not of the same or a similar nature. The failure of any party to take action by reason of such breach or to exercise any such right shall not deprive the party of the right to take action at any time while or after such breach or condition giving rise to such rights continues.

Exhibit A

PARACHUTE TAX PROVISIONS

This Exhibit A sets forth the terms and provisions applicable to the Optionee pursuant to the provisions of Section 9 of the Award Agreement.  This Exhibit A shall be subject in all respects to the terms and conditions of the Award Agreement. 

(a)        To the extent that the Optionee, would otherwise be eligible to receive a payment or benefit pursuant to the terms of this Award Agreement, any employment or other agreement with the Company or any Subsidiary or otherwise in connection with, or arising out of, the Optionee’s employment with the Company or a change in ownership or effective control of the Company or of a substantial portion of its assets (any such payment or benefit, a “Parachute Payment”), that a nationally recognized United States public accounting firm selected by the Company (the “Accountants”) determines, but for this sentence would be subject to excise tax imposed by Section 4999 of the Code (the “Excise Tax”), subject to clause (c) below, then the Company shall pay to the Optionee whichever of the following two alternative forms of payment would result in the Optionee’s receipt, on an after-tax basis, of the greater amount of the Parachute Payment notwithstanding that all or some portion of the Parachute Payment may be subject to the Excise Tax: (1) payment in full of the entire amount of the Parachute Payment (a “Full Payment”), or (2) payment of only a part of the Parachute Payment so that the Optionee receives the largest payment possible without the imposition of the Excise Tax (a “Reduced Payment”).

(b)         If a reduction in the Parachute Payment is necessary pursuant to clause (a), then the reduction shall occur in the following order:  (1) cancellation of acceleration of vesting on any equity awards for which the exercise price exceeds the then fair market value of the underlying equity; (2) reduction of cash payments (with such reduction being applied to the payments in the reverse order in which they would otherwise be made, that is, later payments shall be reduced before earlier payments); and (3) cancellation of acceleration of vesting of equity awards not covered under (1) above; provided,  however, that in the event that acceleration of vesting of equity awards is to be cancelled, acceleration of vesting of full value awards shall be cancelled before acceleration of options and stock appreciation rights and within each class such acceleration of vesting shall be cancelled in the reverse order of the date of grant of such equity awards, that is, later equity awards shall be canceled before earlier equity awards; and provided,  further, that to the extent permitted by Code Section 409A and Sections 280G and 4999 of the Code, if a different reduction procedure would be permitted without violating Code Section 409A or losing the benefit of the reduction under Sections 280G and 4999 of the Code, the Optionee may designate a different order of reduction.

(c)         For purposes of determining whether any of the Parachute Payments (collectively the “Total Payments”) will be subject to the Excise Tax and the amount of such Excise Tax, (i) the Total Payments shall be treated as “parachute payments” within the meaning of Section 280G(b)(2) of the Code, and all “parachute payments” in excess of the “base amount” (as defined under Section 280G(b)(3) of the Code) shall be treated as subject to the Excise Tax, unless and except to the extent that, in the opinion of the Accountants, such Total Payments (in whole or in part):  (1) do not constitute “parachute payments,” including giving effect to the recalculation of stock options in accordance with Treasury Regulation Section 1.280G-1, Q&A 33, (2) represent reasonable compensation for services actually rendered within the meaning of Section 280G(b)(4) of the Code in excess of the “base amount” or (3) are otherwise not subject to the Excise Tax, and (ii) the value of any non-cash benefits or any deferred payment or benefit shall be determined by the Accountants in accordance with the principles of Section 280G of the Code.

(d)         All determinations hereunder shall be made by the Accountants, which determinations shall be final and binding upon the Company and the Optionee.

(e)          The federal tax returns filed by the Optionee (and any filing made by a consolidated tax group which includes the Company) shall be prepared and filed on a basis consistent with the determination of the Accountants with respect to the Excise Tax payable by the Optionee.  The Optionee shall make proper payment of the amount of any Excise Tax, and at the request of the Company, provide to the Company true and correct copies (with any amendments) of his or her federal income tax return as filed with the Internal Revenue Service, and such other documents reasonably requested by the Company, evidencing such payment (provided that the Optionee may delete information unrelated to the Parachute Payment or Excise Tax and provided,  further that the Company at all times shall treat such returns as confidential and use such return only for purpose contemplated by this paragraph). 

(f)          In the event of any controversy with the Internal Revenue Service (or other taxing authority) with regard to the Excise Tax, the Optionee shall permit the Company to control issues related to the Excise Tax (at its expense), provided that such issues do not potentially materially adversely affect the Optionee but the Optionee shall control any other issues.  In the event that the issues are interrelated, the Optionee and the Company shall in good faith cooperate so as not to jeopardize resolution of either issue.  In the event of any conference with any taxing authority as to the Excise Tax or associated income taxes, the Optionee shall permit the representative of the Company to accompany the Optionee, and the Optionee and his representative shall cooperate with the Company and its representative.

(g)          The Company shall be responsible for all charges of the Accountants.

(h)          The Company and the Optionee shall promptly deliver to each other copies of any written communications, and summaries of any verbal communications, with any taxing authority regarding the Excise Tax covered by this Exhibit A.

(i)         Nothing in this Exhibit A is intended to violate the Sarbanes-Oxley Act of 2002 and to the extent that any advance or repayment obligation hereunder would do so, such obligation shall be modified so as to make the advance a nonrefundable payment to the Optionee and the repayment obligation null and void.

(j)         Notwithstanding the foregoing, any payment or reimbursement made pursuant to this Exhibit A shall be paid to the Optionee promptly and in no event later than the end of the calendar year next following the calendar year in which the related tax is paid by the Optionee or where no taxes are required to be remitted, the end of the Optionee’s calendar year following the Optionee’s calendar year in which the audit is completed or there is a final and nonappealable settlement or other resolution of the litigation.

(k)         The provisions of this Exhibit A shall survive the termination of the Optionee’s employment with the Company for any reason and the termination of the Award Agreement.

EX-10.3

Exhibit 10.3

STANDARD FORM

FORM OF AT HOME GROUP INC. 2016 EQUITY INCENTIVE PLAN

RESTRICTED STOCK UNIT - NOTICE OF GRANT

At Home Group Inc. (the “Company”), a Delaware corporation, hereby grants to the Grantee set forth below (the “Grantee”) Restricted Stock Units (the “Restricted Stock Units”), pursuant to the terms and conditions of this Notice of Grant (the “Notice”), the Restricted Stock Unit Award Agreement (reference number 20[__]1-[__]2) attached hereto as Exhibit A (the “Award Agreement”), and the At Home Group Inc. 2016 Equity Incentive Plan (the “Plan”). Capitalized terms used but not defined herein shall have the meaning attributed to such terms in the Award Agreement or, if not defined therein, in the Plan, unless the context requires otherwise. Each Restricted Stock Unit represents the right to receive one (1) Share at the time and in the manner set forth in Section 4 of the Award Agreement.

Date of Grant:	[]
Name of Grantee:	[]
Number of Restricted Stock Units:	[]
Vesting:	The Restricted Stock Units shall vest pursuant to the terms and conditions set forth in Section 3 of the Award Agreement.
Vesting Start Date:	[]

The Restricted Stock Units shall be subject to the execution and return of this Notice by the Grantee to the Company within 30 days of the date hereof (including by utilizing an electronic signature and/or web-based approval and notice process or any other process as may be authorized by the Company). By executing this Notice, the Grantee acknowledges that his or her agreement to the covenants set forth in Section 6 of the Award Agreement is a material inducement to the Company in granting this Award to the Grantee.

This Notice may be executed by facsimile or electronic means (including, without limitation, PDF) and in one or more counterparts, each of which shall be considered an original instrument, but all of which together shall constitute one and the same agreement, and shall become binding when one or more counterparts have been signed by each of the parties hereto and delivered to the other party hereto.

[Signature Page Follows]

1To be updated as necessary to be consistent with the referenced award agreement to which the notice relates.

2To be updated as necessary to be consistent with the referenced award agreement to which the notice relates.

IN WITNESS WHEREOF, the parties hereto have executed this Notice of Grant as of the Date of Grant set forth above.

AT HOME GROUP INC.
By:
Name:	Mary Jane Broussard
Title:	General Counsel and Corporate Secretary
GRANTEE
Name:	[]

[Signature Page to Notice of Restricted Stock Unit Grant for At Home Group Inc. 2016 Equity Incentive Plan]

Exhibit A

AT HOME GROUP INC.

2016 EQUITY INCENTIVE PLAN

RESTRICTED STOCK UNIT

AWARD AGREEMENT

Reference Number: 20[__]3-[__]4

THIS RESTRICTED STOCK UNIT AWARD AGREEMENT (the “Award Agreement”) is entered into by and among At Home Group Inc. (the “Company”) and the individual set forth on the signature page to that certain Notice of Grant (the “Notice”) to which this Award Agreement is attached. The terms and conditions of the Restricted Stock Units granted hereby, to the extent not controlled by the terms and conditions contained in the Plan, shall be as set forth in the Notice and this Award Agreement. Capitalized terms used but not defined herein shall have the meaning attributed to such terms in the Notice or, if not defined therein, in the Plan, unless the context requires otherwise.

1.    No Right to Continued Employee Status or Consultant Service

Nothing contained in this Award Agreement shall confer upon the Grantee the right to the continuation of his or her Employee status, or, in the case of a Consultant or Director, to the continuation of his or her service arrangement, or in either case to interfere with the right of the Company or any of its Subsidiaries or other Affiliates to Terminate the Grantee.

2.    Term of Restricted Stock Units

This Award Agreement shall remain in effect until the Restricted Stock Units have fully vested and been settled or been forfeited by the Grantee as provided in this Award Agreement.

3.    Vesting of Restricted Stock Units.

Subject to the remainder of this Section 3, the Restricted Stock Units shall vest in accordance with the following schedule, subject to the Grantee’s not having Terminated prior to such applicable anniversary, such that the Restricted Stock Units shall become fully (100%) vested upon the [] anniversary of the Vesting Start Date:

Vesting Percentage	Vesting Date
[•]%5	[•]5

3To be updated as appropriate.

4To be updated as appropriate.

5The schedule of vesting date(s) and percentages of the Restricted Stock Units vesting as of each vesting date shall be determined by the Committee at the time of grant.

If the Grantee Terminates for any reason, the portion of the Restricted Stock Units that has not vested as of such date shall terminate upon such Termination and be deemed to have been forfeited by the Grantee without consideration.

Notwithstanding the foregoing, the Restricted Stock Units to the extent then issued and outstanding, shall become fully (100%) vested upon the Grantee’s Termination by the Company without Cause or by the Grantee’s resignation for Good Reason, in either case, on or within one year following the consummation of a Change in Control. For purposes of this Agreement “Good Reason” shall mean (a) if the Grantee is party to an employment or a severance agreement with the Company or one of the Subsidiaries in which “Good Reason” is defined, the occurrence of any circumstances defined as “Good Reason” in such employment or severance agreement, or (b) if the Grantee is not party to an employment or severance agreement with the Company or one of the Subsidiaries in which “Good Reason” is defined, (i) a material reduction in the Grantee’s annual base salary or compensation (including target annual bonus opportunity), or (ii) any material and adverse change in the Grantee’s position, title or status or any change in the Grantee’s job duties, authority or responsibilities to those of lesser status. A termination of employment by the Grantee for Good Reason shall be effectuated by giving the Company written notice of the termination, setting forth the conduct of the Company that constitutes Good Reason, within 30 days of the first date on which the Grantee has knowledge of such conduct. The Grantee shall further provide the Company at least 30 days following the date on which such notice is provided to cure such conduct. Failing such cure, a termination of employment by the Grantee for Good Reason shall be effective on the day following the expiration of such cure period.

4.    Settlement

Within thirty (30) days following the date on which any portion of the Restricted Stock Units vest pursuant to Section 3 of this Award Agreement, the Company shall deliver to the Grantee one (1) Share in settlement of each Restricted Stock Unit that becomes vested on such vesting date.

5.    Termination of Service

If the Grantee incurs a Termination for any reason, whether voluntarily or involuntarily, then the portion of the Restricted Stock Units that have not previously vested shall terminate as of the date of the Grantee’s Termination. If the Grantee incurs a Termination for Cause, then the Restricted Stock Units (whether or not vested) shall be forfeited and terminate immediately without consideration upon the effective date of such Termination for Cause.

6.    Prohibited Activities

(a)       No Sale or Transfer. Unless otherwise required by law, the Restricted Stock Units shall not be (i) sold, transferred or otherwise disposed of, (ii) pledged or otherwise hypothecated or (iii) subject to attachment, execution or levy of any kind, other than by will or by the laws of descent or distribution; provided,  however, that any transferred Restricted Stock Units will be subject to all of the same terms and conditions as provided in the Plan and this Award Agreement and the Grantee’s estate or beneficiary appointed in accordance with the Plan will remain liable for any withholding tax that may be imposed by any federal, state or local tax authority.

(b)       Right to Terminate Restricted Stock Units and Recovery. The Grantee understands and agrees that the Company has granted the Restricted Stock Units to the Grantee to

reward the Grantee for the Grantee’s future efforts and loyalty to the Company and its Affiliates by giving the Grantee the opportunity to participate in the potential future appreciation of the Company. Accordingly, if (a) the Grantee materially violates the Grantee’s obligations relating to the non-disclosure or non-use of confidential or proprietary information under any Restrictive Agreement to which the Grantee is a party, or (b) the Grantee materially breaches or violates the Grantee’s obligations relating to non-disparagement under any Restrictive Agreement to which the Grantee is a party, or (c) the Grantee engages in any activity prohibited by Section 6 of this Award Agreement, or (d) the Grantee materially breaches or violates any non-solicitation obligations under any Restrictive Agreement to which the Grantee is a party, or (e) the Grantee breaches or violates any non-competition obligations under any Restrictive Agreement to which the Grantee is a party, or (f) the Grantee is convicted of a felony against the Company or any of its Affiliates, then, in addition to any other rights and remedies available to the Company, the Company shall be entitled, at its option, exercisable by written notice, to terminate the Restricted Stock Units (including the vested portion of the Restricted Stock Units) without consideration, which shall be of no further force and effect. “Restrictive Agreement” shall mean any agreement between the Company or any Subsidiary and the Grantee that contains non-competition, non-solicitation, non-hire, non-disparagement, or confidentiality restrictions applicable to the Grantee.

(c)       Other Remedies. The Grantee specifically acknowledges and agrees that its remedies under this Section 6 shall not prevent the Company or any Subsidiary from seeking injunctive or other equitable relief in connection with the Grantee’s breach of any Restrictive Agreement. In the event that the provisions of this Section 6 should ever be deemed to exceed the limitation provided by applicable law, then the Grantee and the Company agree that such provisions shall be reformed to set forth the maximum limitations permitted.

7.No Rights as Stockholder

The Grantee shall have no rights as a stockholder with respect to the Shares covered by the Restricted Stock Units until the effective date of issuance of the Shares and the entry of the Grantee’s name as a shareholder of record on the books of the Company following delivery of the Shares in settlement of the Restricted Stock Units.

8.Taxation Upon Settlement of the Restricted Stock Units; Tax Withholding; Parachute Tax Provisions

The Grantee understands that the Grantee will recognize income, for Federal, state and local income tax purposes, as applicable, in respect of the vesting and/or settlement of the Restricted Stock Units. The acceptance of the Shares by the Grantee shall constitute an agreement by the Grantee to report such income in accordance with then applicable law and to cooperate with Company and its subsidiaries in establishing the amount of such income and corresponding deduction to the Company and/or its subsidiaries for its income tax purposes.

The Grantee is responsible for all tax obligations that arise as a result of the vesting and settlement of the Restricted Stock Units. The Company may withhold from any amount payable to the Grantee an amount sufficient to cover any Federal, state or local withholding taxes which may become required with respect to such vesting and settlement or take any other action it deems necessary to satisfy any income or other tax withholding requirements as a result of the vesting and settlement of the Restricted Stock Units. The Company shall have the right to require the payment of any such

taxes and require that the Grantee, or the Grantee’s beneficiary, to furnish information deemed necessary by the Company to meet any tax reporting obligation as a condition to delivery of any Shares pursuant to settlement of the Restricted Stock Units. The Grantee may pay his or her withholding tax obligation in connection with the vesting and settlement of the Restricted Stock Units, by making a cash payment to the Company. In addition, the Committee, in its sole discretion, may allow the Grantee, to pay his or her withholding tax obligation in connection with the vesting and settlement of the Restricted Stock Units, by (x) having withheld a portion of the Shares then issuable to him or her upon settlement of the Restricted Stock Units or (z) surrendering Shares that have been held by the Grantee for at least six (6) months (or such lesser period as may be permitted by the Committee) prior to the settlement of the Restricted Stock Units, in each case having an aggregate Fair Market Value equal to the withholding taxes.

In connection with the grant of the Restricted Stock Units, the parties wish to memorialize their agreement regarding the treatment of any potential golden parachute payments as set forth in Exhibit A attached hereto.

9.      Securities Laws

Upon the acquisition of any Shares pursuant to the settlement of the Restricted Stock Units, the Grantee will make such written representations, warranties, and agreements as the Committee may reasonably request in order to comply with securities laws or with this Award Agreement. Grantee hereby agrees not to offer, sell or otherwise attempt to dispose of any Shares issued to the Grantee upon settlement of the Restricted Stock Units in any way which would: (x) require the Company to file any registration statement with the Securities and Exchange Commission (or any similar filing under state law or the laws of any other county) or to amend or supplement any such filing or (y) violate or cause the Company to violate the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, the rules and regulations promulgated thereunder, or any other Federal, state or local law, or the laws of any other country. The Company reserves the right to place restrictions on any Shares the Grantee may receive as a result of the settlement of the Restricted Stock Units.

10.Modification, Amendment, and Termination of Restricted Stock Units

This Award Agreement may not be modified, amended, terminated and no provision hereof may be waived in whole or in part except by a written agreement signed by the Company and the Grantee and no modification shall, without the consent of the Grantee, alter to the Grantee’s material detriment or materially impair any rights of the Grantee under this Award Agreement except to the extent permitted under the Plan.

11.Notices

Unless otherwise provided herein, any notices or other communication given or made pursuant to the Notice, this Award Agreement or the Plan shall be in writing and shall be deemed to have been duly given (i) as of the date delivered, if personally delivered (including receipted courier service) or overnight delivery service, with confirmation of receipt; (ii) on the date the delivering party receives confirmation, if delivered by facsimile to the number indicated or by email to the address indicated or through an electronic administrative system designated by the Company; (iii) one (1) business day after being sent by reputable commercial overnight delivery service courier, with confirmation of

receipt; or (iv) three (3) business days after being mailed by registered or certified mail, return receipt requested, postage prepaid and addressed to the intended recipient as set forth below:

(a)    If to the Company at the address below:

At Home Group Inc.

1600 East Plano Parkway

Plano, Texas 75074

Attn: General Counsel

Phone: (972) 265‑6227

(b)    If to the Grantee, at the most recent address, facsimile number or email contained in the Company’s records.

12.    Award Agreement Subject to Plan and Applicable Law

This Award Agreement is made pursuant to the Plan and shall be interpreted to comply therewith. A copy of the Plan is attached hereto. Any provision of this Award Agreement inconsistent with the Plan shall be considered void and replaced with the applicable provision of the Plan. The Plan shall control in the event there shall be any conflict between the Plan, the Notice, and this Award Agreement, and it shall control as to any matters not contained in this Award Agreement. The Committee shall have authority to make constructions of this Award Agreement, and to correct any defect or supply any omission or reconcile any inconsistency in this Award Agreement, and to prescribe rules and regulations relating to the administration of this Award and other Awards granted under the Plan.

This Award Agreement shall be governed by the laws of the State of Delaware, without regard to the conflicts of law principles thereof, and subject to the exclusive jurisdiction of the courts therein. The Grantee hereby consents to personal jurisdiction in any action brought in any court, federal or state, within the State of Delaware having subject matter jurisdiction in the matter.

13.Section 409A

The Restricted Stock Units are intended to be exempt from Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and, accordingly, to the maximum extent permitted, this Award Agreement shall be interpreted to be exempt from Section 409A of the Code or, if not exempt, in compliance therewith. Nothing contained herein shall constitute any representation or warranty by the Company regarding compliance with Section 409A of the Code. The Company shall have no obligation to take any action to prevent the assessment of any additional income tax, interest or penalties under Section 409A of the Code on any Person and the Company, its Subsidiaries and Affiliates, and each of their respective employees and representatives, shall have no liability to the Grantee with respect thereto.

14.Headings and Capitalized Terms

Unless otherwise provided herein, capitalized terms used herein that are defined in the Plan and not defined herein shall have the meanings set forth in the Plan. Headings are for convenience only and are not deemed to be part of this Award Agreement. Unless otherwise indicated, any reference to a Section herein is a reference to a Section of this Award Agreement.

15.Severability and Reformation

If any provision of this Award Agreement shall be determined by a court of law of competent jurisdiction to be unenforceable for any reason, such unenforceability shall not affect the enforceability of any of the remaining provisions hereof; and this Award Agreement, to the fullest extent lawful, shall be reformed and construed as if such unenforceable provision, or part thereof, had never been contained herein, and such provision or part thereof shall be reformed or construed so that it would be enforceable to the maximum extent legally possible.

16.Binding Effect

This Award Agreement shall be binding upon the parties hereto, together with their personal executors, administrator, successors, personal representatives, heirs and permitted assigns.

17.Entire Agreement

This Award Agreement, together with the Plan, supersedes all prior written and oral agreements and understandings among the parties as to its subject matter and constitutes the entire agreement of the parties with respect to the subject matter hereof. If there is any conflict between the Notice, this Award Agreement and the Plan, then the applicable terms of the Plan shall govern.

18.Waiver

Waiver by any party of any breach of this Award Agreement or failure to exercise any right hereunder shall not be deemed to be a waiver of any other breach or right whether or not of the same or a similar nature. The failure of any party to take action by reason of such breach or to exercise any such right shall not deprive the party of the right to take action at any time while or after such breach or condition giving rise to such rights continues.

Exhibit A

PARACHUTE TAX PROVISIONS

This Exhibit A sets forth the terms and provisions applicable to the Grantee pursuant to the provisions of Section 8 of the Award Agreement. This Exhibit A shall be subject in all respects to the terms and conditions of the Award Agreement.

(a)       To the extent that the Grantee, would otherwise be eligible to receive a payment or benefit pursuant to the terms of this Award Agreement, any employment or other agreement with the Company or any Subsidiary or otherwise in connection with, or arising out of, the Grantee’s employment with the Company or a change in ownership or effective control of the Company or of a substantial portion of its assets (any such payment or benefit, a “Parachute Payment”), that a nationally recognized United States public accounting firm selected by the Company (the “Accountants”) determines, but for this sentence would be subject to excise tax imposed by Section 4999 of the Code (the “Excise Tax”), subject to clause (c) below, then the Company shall pay to the Grantee whichever of the following two alternative forms of payment would result in the Grantee’s receipt, on an after-tax basis, of the greater amount of the Parachute Payment notwithstanding that all or some portion of the Parachute Payment may be subject to the Excise Tax: (1) payment in full of the entire amount of the Parachute Payment (a “Full Payment”), or (2) payment of only a part of the Parachute Payment so that the Grantee receives the largest payment possible without the imposition of the Excise Tax (a “Reduced Payment”).

(b)       If a reduction in the Parachute Payment is necessary pursuant to clause (a), then the reduction shall occur in the following order: (1) cancellation of acceleration of vesting on any equity awards for which the exercise price exceeds the then fair market value of the underlying equity; (2) reduction of cash payments (with such reduction being applied to the payments in the reverse order in which they would otherwise be made, that is, later payments shall be reduced before earlier payments); and (3) cancellation of acceleration of vesting of equity awards not covered under (1) above; provided,  however, that in the event that acceleration of vesting of equity awards is to be cancelled, acceleration of vesting of full value awards shall be cancelled before acceleration of options and stock appreciation rights and within each class such acceleration of vesting shall be cancelled in the reverse order of the date of grant of such equity awards, that is, later equity awards shall be canceled before earlier equity awards; and provided,  further, that to the extent permitted by Code Section 409A and Sections 280G and 4999 of the Code, if a different reduction procedure would be permitted without violating Code Section 409A or losing the benefit of the reduction under Sections 280G and 4999 of the Code, the Grantee may designate a different order of reduction.

(c)       For purposes of determining whether any of the Parachute Payments (collectively the “Total Payments”) will be subject to the Excise Tax and the amount of such Excise Tax, (i) the Total Payments shall be treated as “parachute payments” within the meaning of Section 280G(b)(2) of the Code, and all “parachute payments” in excess of the “base amount” (as defined under Section 280G(b)(3) of the Code) shall be treated as subject to the Excise Tax, unless and except to the extent that, in the opinion of the Accountants, such Total Payments (in whole or in part):  (1) do not constitute “parachute payments,” including giving effect to the recalculation of stock options in accordance with Treasury Regulation Section 1.280G‑1, Q&A 33, (2) represent reasonable compensation for services actually rendered within the meaning of Section 280G(b)(4) of the Code in excess of the “base amount” or (3) are otherwise not subject to the Excise Tax, and (ii) the value

of any non-cash benefits or any deferred payment or benefit shall be determined by the Accountants in accordance with the principles of Section 280G of the Code.

(d)       All determinations hereunder shall be made by the Accountants, which determinations shall be final and binding upon the Company and the Grantee.

(e)       The federal tax returns filed by the Grantee (and any filing made by a consolidated tax group which includes the Company) shall be prepared and filed on a basis consistent with the determination of the Accountants with respect to the Excise Tax payable by the Grantee. The Grantee shall make proper payment of the amount of any Excise Tax, and at the request of the Company, provide to the Company true and correct copies (with any amendments) of his or her federal income tax return as filed with the Internal Revenue Service, and such other documents reasonably requested by the Company, evidencing such payment (provided that the Grantee may delete information unrelated to the Parachute Payment or Excise Tax and provided,  further that the Company at all times shall treat such returns as confidential and use such return only for purpose contemplated by this paragraph).

(f)       In the event of any controversy with the Internal Revenue Service (or other taxing authority) with regard to the Excise Tax, the Grantee shall permit the Company to control issues related to the Excise Tax (at its expense), provided that such issues do not potentially materially adversely affect the Grantee but the Grantee shall control any other issues. In the event that the issues are interrelated, the Grantee and the Company shall in good faith cooperate so as not to jeopardize resolution of either issue. In the event of any conference with any taxing authority as to the Excise Tax or associated income taxes, the Grantee shall permit the representative of the Company to accompany the Grantee, and the Grantee and his representative shall cooperate with the Company and its representative.

(g)       The Company shall be responsible for all charges of the Accountants.

(h)       The Company and the Grantee shall promptly deliver to each other copies of any written communications, and summaries of any verbal communications, with any taxing authority regarding the Excise Tax covered by this Exhibit A.

(i)       Nothing in this Exhibit A is intended to violate the Sarbanes-Oxley Act of 2002 and to the extent that any advance or repayment obligation hereunder would do so, such obligation shall be modified so as to make the advance a nonrefundable payment to the Grantee and the repayment obligation null and void.

(j)       Notwithstanding the foregoing, any payment or reimbursement made pursuant to this Exhibit A shall be paid to the Grantee promptly and in no event later than the end of the calendar year next following the calendar year in which the related tax is paid by the Grantee or where no taxes are required to be remitted, the end of the Grantee’s calendar year following the Grantee’s calendar year in which the audit is completed or there is a final and nonappealable settlement or other resolution of the litigation.

(k)       The provisions of this Exhibit A shall survive the termination of the Grantee’s employment with the Company for any reason and the termination of the Award Agreement.

EX-10.4

Exhibit 10.4

FORM OF AT HOME GROUP INC. 2016 EQUITY INCENTIVE PLAN

NONSTATUTORY STOCK OPTION - Notice of Grant

(SPECIAL TRANSITION GRANT)

At Home Group Inc. (the “Company”), a Delaware corporation, hereby grants to the Optionee set forth below (the “Optionee”) an option (the “Option”) to purchase the number of Shares of common stock of the Company (“Shares”) set forth below at the Option Price set forth below, pursuant to the terms and conditions of this Notice of Grant (the “Notice”), the Nonstatutory Stock Option Award Agreement (reference number 20[__]1-[__]2)  attached hereto as Exhibit A (the “Award Agreement”), and the At Home Group Inc. 2016 Equity Incentive Plan (the “Plan”).

Date of Grant:	[]
Name of Optionee:	[]
Number of Shares Subject to Option:	[] Shares
Option Price (Price Per Share):	$[]3 per Share
Expiration Date:	7 year anniversary of the Date of Grant
Vesting:	The Option shall vest pursuant to the terms and conditions set forth in Section 3 of the Award Agreement.
Vesting Start Date:	[]

The Option shall be subject to the execution and return of this Notice by the Optionee to the Company within 30 days of the date hereof (including by utilizing an electronic signature and/or web-based approval and notice process or any other process as may be authorized by the Company). This Option is a non-qualified stock option and is not intended by the parties hereto to be, and shall not be treated as, an “incentive stock option” within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended. Capitalized terms used but not defined herein shall have the meaning attributed to such terms in the Award Agreement or, if not defined therein, in the Plan, unless the context requires otherwise.  By executing this Notice, the Optionee acknowledges that his or her agreement to the covenants set forth in Section 7 of the Award Agreement is a material inducement to the Company in granting this Award to the Optionee.

This Notice may be executed by facsimile or electronic means (including, without limitation, PDF) and in one or more counterparts, each of which shall be considered an original instrument, but all of which together shall constitute one and the same agreement, and shall become binding when one or more counterparts have been signed by each of the parties hereto and delivered to the other party hereto.

[Signature Page Follows]

1To be updated as necessary to be consistent with the referenced award agreement to which the notice relates.

2To be updated as necessary to be consistent with the referenced award agreement to which the notice relates.

3Option Price to equal fair market value per Share on Date of Grant.

IN WITNESS WHEREOF, the parties hereto have executed this Notice of Grant as of the Date of Grant set forth above.

AT HOME GROUP INC.

By:

Name:

Title:

OPTIONEE

By:

Name:

[Signature Page to Notice of Grant for At Home Group Inc. 2016 Equity Incentive Plan Nonqualified Stock Option]

Exhibit A

AT HOME GROUP INC.

2016 EQUITY INCENTIVE PLAN

NON-STATUTORY STOCK OPTION

Award Agreement 

(SPECIAL TRANSITION GRANT)

Reference Number: 20[__]4-[__]5

THIS NONSTATUTORY STOCK OPTION AWARD AGREEMENT (the “Award Agreement”) is entered into by and among At Home Group Inc. (the “Company”) and the individual set forth on the signature page to that certain Notice of Grant (the “Notice”) to which this Award Agreement is attached.  The terms and conditions of the Option granted hereby, to the extent not controlled by the terms and conditions contained in the Plan, shall be as set forth in the Notice and this Award Agreement.    Capitalized terms used but not defined herein shall have the meaning attributed to such terms in the Notice or, if not defined therein, in the Plan, unless the context requires otherwise.

1.        No Right to Continued Employee Status or Consultant Service

Nothing contained in this Award Agreement shall confer upon the Optionee the right to the continuation of his or her Employee status, or, in the case of a Consultant or Director, to the continuation of his or her service arrangement, or in either case to interfere with the right of the Company or any of its Subsidiaries or other Affiliates to Terminate the Optionee.

2.        Term of Option

As a general matter, the Option will expire on the Expiration Date set forth in the Notice and be deemed to have been forfeited by the Optionee. As provided below, the Optionee’s right to exercise the Option may expire prior to the Expiration Date if the Optionee Terminates, including in the event of the Optionee’s Disability or death. This Award Agreement shall remain in effect until the Option has fully vested and been exercised or any unexercised portion thereof has been forfeited by the Optionee as provided in this Award Agreement. No portion of this Option shall be exercisable after the Expiration Date, or such earlier date as may be applicable, except as provided herein.

3.        Vesting of Option 

Subject to the remainder of this Section  3,  the Option will vest in accordance with the following schedule, with the Option becoming fully (100%) vested as of the [●] anniversary of the Vesting Start Date, subject to the Optionee not having Terminated as of the applicable vesting date:

4To be updated as appropriate.

5To be updated as appropriate.

Vesting Percentage	Vesting Date
[]%6	[]6

If the Optionee Terminates for any reason, the portion of the Option that has not vested as of such date shall terminate upon such Termination and be deemed to have been forfeited by the Optionee without consideration.   Notwithstanding the foregoing, the Option, to the extent then issued, outstanding, and unexercised, shall become fully (100%) vested upon the consummation of a Change in Control.

4.        Exercise

Prior to the Expiration Date and at any time prior to the Optionee’s Termination, the Optionee may exercise all or a portion of the Option, to the extent vested, by giving notice in the form, to the person, and using the administrative method and the exercise procedures established by the Committee from time to time (including any procedures utilizing an electronic signature and/or web-based approval and notice process), specifying the number of Shares to be acquired. The Optionee’s right to exercise the vested portion of the Option following the date that of the Optionee’s Termination will depend on the reason for such Termination, as described in Sections 5 and 6 below.

The Optionee must pay to the Company at the time of exercise the amount of the Option Price for the number of Shares covered by the notice to exercise (“Aggregate Option Price”). The Aggregate Option Price for any Shares purchased pursuant to the exercise of an Option shall be paid in any or any combination of the following forms: (w) cash or its equivalent (e.g., a check);  (x) by making arrangements through a registered broker-dealer pursuant to cashless exercise procedures established by the Committee from time to time; (y) if permitted by the Committee in its sole discretion, the transfer, either actually or by attestation, to the Company of Shares that have been held by the Optionee for at least six (6) months (or such lesser period as may be permitted by the Committee) prior to the exercise of the Option, such transfer to be upon such terms and conditions as determined by the Committee; or (z) in the form of other property as determined by the Committee in its sole discretion. Any Shares transferred to the Company as payment of the exercise price under an Option shall be valued at their Fair Market Value on the last business day preceding the date of exercise of such Option. In addition, at the discretion of the Committee in its sole discretion at the time of exercise, the Optionee may provide for the payment of the Aggregate Option Price through Share withholding as a result of which the number of Shares issued upon exercise of an Option would be reduced by a number of Shares having a Fair Market Value equal to the Aggregate Option Price. If requested by the Committee, the Optionee shall deliver this Award Agreement to the Company, which shall endorse thereon a notation of such exercise and return such Award Agreement to the Optionee. No fractional Shares (or cash in lieu thereof) shall be issued upon exercise of an Option and the number of Shares that may be purchased upon exercise shall be rounded down to the nearest number of whole Shares.

6The schedule of vesting date(s) and percentages of the Option vesting as of each vesting date shall be determined by the Committee at the time of grant.

5.        Termination of Service 

If the Optionee incurs a Termination for any reason, whether voluntarily or involuntarily, without Cause, other than as a result of the Optionee’s death or Disability, then the portion of this Option that has previously vested but has not been exercised shall remain exercisable until, and shall terminate upon, the first to occur of (a) the end of the day that is ninety (90) days following the date of the Optionee’s Termination or, (b) the Expiration Date. If the Optionee incurs a Termination for Cause, then this Option and all rights attached hereto shall be forfeited and terminate immediately upon the effective date of such Termination for Cause.

6.        Death or Disability of the Optionee 

Upon the Optionee’s Termination by reason of death or Disability, the vested portion of the Option shall remain exercisable until, and shall terminate upon, the first to occur of (a) the end of the day that is one (1) year after the date of the Optionee’s Termination for death or Disability, as applicable, or (b) the Expiration Date of the Option.  Until such termination of the Option, the vested portion of the Option may, to the extent that this Option has not previously been exercised by the Optionee, be exercised by the Optionee in the case of his or her Disability, or, in the case of death, by the Optionee’s personal representative or the person entitled to the Optionee’s rights under this Award Agreement.

7.        Prohibited Activities 

(a)     No Sale or Transfer. Unless otherwise required by law, this Option shall not be (i) sold, transferred or otherwise disposed of, (ii) pledged or otherwise hypothecated or (iii) subject to attachment, execution or levy of any kind, other than by will or by the laws of descent or distribution; provided,  however, that any transferred Option will be subject to all of the same terms and conditions as provided in the Plan and this Award Agreement and the Optionee’s estate or beneficiary appointed in accordance with the Plan will remain liable for any withholding tax that may be imposed by any federal, state or local tax authority.

(b)     Right to Terminate Option and Recovery.  The Optionee understands and agrees that the Company has granted this Option to the Optionee to reward the Optionee for the Optionee’s future efforts and loyalty to the Company and its Affiliates by giving the Optionee the opportunity to participate in the potential future appreciation of the Company.  Accordingly, if (a) the Optionee materially violates the Optionee’s obligations relating to the non-disclosure or non-use of confidential or proprietary information under any Restrictive Agreement to which the Optionee is a party, or (b) the Optionee materially breaches or violates the Optionee’s obligations relating to non-disparagement under any Restrictive Agreement to which the Optionee is a party, or (c) the Optionee engages in any activity prohibited by Section 7 of this Award Agreement, or (d) the Optionee materially breaches or violates any non-solicitation obligations under any Restrictive Agreement to which the Optionee is a party, or (e) the Optionee breaches or violates any non-competition obligations under any Restrictive Agreement to which the Optionee is a party, or (f) the Optionee is convicted of a felony against the Company or any of its Affiliates, then, in addition to any other rights and remedies available to the Company, the Company shall be entitled, at its option, exercisable by written notice, to terminate the Option (including the vested portion of the Option), or any unexercised portion thereof, which shall be of no further force and effect.  “Restrictive Agreement” shall mean any agreement between the Company or any Subsidiary and

the Optionee (including any prior option agreement) that contains non-competition, non-solicitation, non-hire, non-disparagement, or confidentiality restrictions applicable to the Optionee. 

(c)     Other Remedies. The Optionee specifically acknowledges and agrees that its remedies under this Section 7 shall not prevent the Company or any Subsidiary from seeking injunctive or other equitable relief in connection with the Optionee’s breach of any Restrictive Agreement.  In the event that the provisions of this Section 7 should ever be deemed to exceed the limitation provided by applicable law, then the Optionee and the Company agree that such provisions shall be reformed to set forth the maximum limitations permitted. 

8.        No Rights as Stockholder

The Optionee shall have no rights as a stockholder with respect to the Shares covered by any exercise of this Option until the effective date of issuance of the Shares and the entry of the Optionee’s name as a shareholder of record on the books of the Company following exercise of this Option.

9.        Taxation Upon Exercise of Option; Tax Withholding; Parachute Tax Provisions

The Optionee understands that, upon exercise of this Option, the Optionee will recognize income, for Federal, state and local income tax purposes, as applicable, in an amount equal to the amount by which the Fair Market Value of the Shares, determined as of the date of exercise, exceeds the Option Price. The acceptance of the Shares by the Optionee shall constitute an agreement by the Optionee to report such income in accordance with then applicable law and to cooperate with Company and its subsidiaries in establishing the amount of such income and corresponding deduction to the Company and/or its subsidiaries for its income tax purposes.

The Optionee is responsible for all tax obligations that arise as a result of the exercise of this Option. The Company may withhold from any amount payable to the Optionee an amount sufficient to cover any Federal, state or local withholding taxes which may become required with respect to such exercise or take any other action it deems necessary to satisfy any income or other tax withholding requirements as a result of the exercise this Option. The Company shall have the right to require the payment of any such taxes and require that the Optionee, or the Optionee’s beneficiary, to furnish information deemed necessary by the Company to meet any tax reporting obligation as a condition to exercise or before the issuance of any Shares pursuant to this Option. The Optionee may pay his or her withholding tax obligation in connection with the exercise of the Option, by making (w) a cash payment to the Company, or (x)  arrangements through a registered broker-dealer pursuant to cashless exercise procedures established by the Committee from time to time.  In addition, the Committee, in its sole discretion, may allow the Optionee, to pay his or her withholding tax obligation in connection with the exercise of the Option, by (y) having withheld a portion of the Shares then issuable to him or her upon exercise of the Option or (z) surrendering Shares that have been held by the Optionee for at least six (6) months (or such lesser period as may be permitted by the Committee) prior to the exercise of the Award, in each case having an aggregate Fair Market Value equal to the withholding taxes.  

In connection with the grant of this Option, the parties wish to memorialize their agreement regarding the treatment of any potential golden parachute payments as set forth in Exhibit A attached hereto.

10.        Securities Laws; Tolling of Exercise Period Expiration

(a)     Upon the acquisition of any Shares pursuant to the exercise of the Option, the Optionee will make such written representations, warranties, and agreements as the Committee may reasonably request in order to comply with securities laws or with this Award Agreement. Optionee hereby agrees not to offer, sell or otherwise attempt to dispose of any Shares issued to the Optionee upon exercise of the Option in any way which would: (x) require the Company to file any registration statement with the Securities and Exchange Commission (or any similar filing under state law or the laws of any other county) or to amend or supplement any such filing or (y) violate or cause the Company to violate the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, the rules and regulations promulgated thereunder, or any other Federal, state or local law, or the laws of any other country. The Company reserves the right to place restrictions on any Shares the Optionee may receive as a result of the exercise of the Option.

(b)     Notwithstanding any provision contained in this Award Agreement or the Plan to the contrary,

(i) if, following the Optionee’s Termination, all or a portion of the exercise period applicable to the Option occurs during a time when the Optionee cannot exercise the Option without violating (w) an applicable Federal, state or local law, (x) the rules related to a blackout period declared by the Company, (y) any agreed to lock-up arrangement, or (z) other similar circumstance, in each case, the exercise period applicable to the Option will be tolled for the number of days that such prohibitions or restrictions apply, such that the exercise period will be extended by the same number of days as were subject to the prohibitions or restrictions; provided,  however, that the exercise period may not be extended due to such tolling past the Expiration Date of the Option as set forth above; and

(ii) if the Expiration Date is set to occur during a time that the Optionee cannot exercise the Option without violating an applicable Federal, state or local law (and the Option has not previously been exercised or otherwise terminated), the exercise period will be tolled until such time as the violation would no longer apply; provided,  however, that the exercise period applicable to the Option in this event will be fifteen (15) days from the date such potential violation is longer applicable.

11.        Modification, Extension and Renewal of Options

This Award Agreement may not be modified, amended, terminated and no provision hereof may be waived in whole or in part except by a written agreement signed by the Company and the Optionee and no modification shall, without the consent of the Optionee, alter to the Optionee’s material detriment or materially impair any rights of the Optionee under this Award Agreement except to the extent permitted under the Plan.

12.        Notices

Unless otherwise provided herein, any notices or other communication given or made pursuant to the Notice, this Award Agreement or the Plan shall be in writing and shall be deemed to have been duly given (i) as of the date delivered, if personally delivered (including receipted courier service) or overnight delivery service, with confirmation of receipt; (ii) on the date the delivering party receives confirmation, if delivered by facsimile to the number indicated or by email to the address indicated or through an electronic administrative system designated by the Company; (iii) one (1) business day after being sent by reputable commercial overnight delivery service courier, with confirmation of receipt; or (iv) three (3) business days after being mailed by registered or certified mail, return receipt requested, postage prepaid and addressed to the intended recipient as set forth below:

(a)     If to the Company at the address below:

At Home Group Inc.

1600 East Plano Parkway

Plano, Texas 75074

Attn: General Counsel

Phone:  (972) 265-6227

(b)     If to the Optionee, at the most recent address, facsimile number or email contained in the Company’s records.

13.        Award Agreement Subject to Plan and Applicable Law

This Option is made pursuant to the Plan and shall be interpreted to comply therewith. A copy of the Plan is attached hereto. Any provision of this Option inconsistent with the Plan shall be considered void and replaced with the applicable provision of the Plan. The Plan shall control in the event there shall be any conflict between the Plan, the Notice, and this Award Agreement, and it shall control as to any matters not contained in this Award Agreement. The Committee shall have authority to make constructions of this Award Agreement, and to correct any defect or supply any omission or reconcile any inconsistency in this Award Agreement, and to prescribe rules and regulations relating to the administration of this Award and other Awards granted under the Plan.

This Option shall be governed by the laws of the State of Delaware, without regard to the conflicts of law principles thereof, and subject to the exclusive jurisdiction of the courts therein. The Optionee hereby consents to personal jurisdiction in any action brought in any court, federal or state, within the State of Delaware having subject matter jurisdiction in the matter.

14.        Headings and Capitalized Terms

Unless otherwise provided herein, capitalized terms used herein that are defined in the Plan and not defined herein shall have the meanings set forth in the Plan. Headings are for convenience only and are not deemed to be part of this Award Agreement. Unless otherwise indicated, any reference to a Section herein is a reference to a Section of this Award Agreement.

15.        Severability and Reformation

If any provision of this Award Agreement shall be determined by a court of law of competent jurisdiction to be unenforceable for any reason, such unenforceability shall not affect the enforceability of any of the remaining provisions hereof; and this Award Agreement, to the fullest extent lawful, shall be reformed and construed as if such unenforceable provision, or part thereof, had never been contained herein, and such provision or part thereof shall be reformed or construed so that it would be enforceable to the maximum extent legally possible.

16.        Binding Effect

This Award Agreement shall be binding upon the parties hereto, together with their personal executors, administrator, successors, personal representatives, heirs and permitted assigns.

17.        Entire Agreement

This Award Agreement, together with the Plan, supersedes all prior written and oral agreements and understandings among the parties as to its subject matter and constitutes the entire agreement of the parties with respect to the subject matter hereof.  If there is any conflict between the Notice, this Award Agreement and the Plan, then the applicable terms of the Plan shall govern.

18.        Waiver

Waiver by any party of any breach of this Award Agreement or failure to exercise any right hereunder shall not be deemed to be a waiver of any other breach or right whether or not of the same or a similar nature. The failure of any party to take action by reason of such breach or to exercise any such right shall not deprive the party of the right to take action at any time while or after such breach or condition giving rise to such rights continues.

Exhibit A

PARACHUTE TAX PROVISIONS

This Exhibit A sets forth the terms and provisions applicable to the Optionee pursuant to the provisions of Section 9 of the Award Agreement.  This Exhibit A shall be subject in all respects to the terms and conditions of the Award Agreement. 

(a)To the extent that the Optionee, would otherwise be eligible to receive a payment or benefit pursuant to the terms of this Award Agreement, any employment or other agreement with the Company or any Subsidiary or otherwise in connection with, or arising out of, the Optionee’s employment with the Company or a change in ownership or effective control of the Company or of a substantial portion of its assets (any such payment or benefit, a “Parachute Payment”), that a nationally recognized United States public accounting firm selected by the Company (the “Accountants”) determines, but for this sentence would be subject to excise tax imposed by Section 4999 of the Code (the “Excise Tax”), subject to clause (c) below, then the Company shall pay to the Optionee whichever of the following two alternative forms of payment would result in the Optionee’s receipt, on an after-tax basis, of the greater amount of the Parachute Payment notwithstanding that all or some portion of the Parachute Payment may be subject to the Excise Tax: (1) payment in full of the entire amount of the Parachute Payment (a “Full Payment”), or (2) payment of only a part of the Parachute Payment so that the Optionee receives the largest payment possible without the imposition of the Excise Tax (a “Reduced Payment”).

(b)If a reduction in the Parachute Payment is necessary pursuant to clause (a), then the reduction shall occur in the following order:  (1) cancellation of acceleration of vesting on any equity awards for which the exercise price exceeds the then fair market value of the underlying equity; (2) reduction of cash payments (with such reduction being applied to the payments in the reverse order in which they would otherwise be made, that is, later payments shall be reduced before earlier payments); and (3) cancellation of acceleration of vesting of equity awards not covered under (1) above; provided,  however, that in the event that acceleration of vesting of equity awards is to be cancelled, acceleration of vesting of full value awards shall be cancelled before acceleration of options and stock appreciation rights and within each class such acceleration of vesting shall be cancelled in the reverse order of the date of grant of such equity awards, that is, later equity awards shall be canceled before earlier equity awards; and provided,  further, that to the extent permitted by Code Section 409A and Sections 280G and 4999 of the Code, if a different reduction procedure would be permitted without violating Code Section 409A or losing the benefit of the reduction under Sections 280G and 4999 of the Code, the Optionee may designate a different order of reduction.

(c)For purposes of determining whether any of the Parachute Payments (collectively the “Total Payments”) will be subject to the Excise Tax and the amount of such Excise Tax, (i) the Total Payments shall be treated as “parachute payments” within the meaning of Section 280G(b)(2) of the Code, and all “parachute payments” in excess of the “base amount” (as defined under Section 280G(b)(3) of the Code) shall be treated as subject to the Excise Tax, unless and except to the extent that, in the opinion of the Accountants, such Total Payments (in whole or in part):  (1) do not constitute “parachute payments,” including giving effect to the recalculation of

stock options in accordance with Treasury Regulation Section 1.280G-1, Q&A 33, (2) represent reasonable compensation for services actually rendered within the meaning of Section 280G(b)(4) of the Code in excess of the “base amount” or (3) are otherwise not subject to the Excise Tax, and (ii) the value of any non-cash benefits or any deferred payment or benefit shall be determined by the Accountants in accordance with the principles of Section 280G of the Code.

(d)All determinations hereunder shall be made by the Accountants, which determinations shall be final and binding upon the Company and the Optionee.

(e)The federal tax returns filed by the Optionee (and any filing made by a consolidated tax group which includes the Company) shall be prepared and filed on a basis consistent with the determination of the Accountants with respect to the Excise Tax payable by the Optionee.  The Optionee shall make proper payment of the amount of any Excise Tax, and at the request of the Company, provide to the Company true and correct copies (with any amendments) of his or her federal income tax return as filed with the Internal Revenue Service, and such other documents reasonably requested by the Company, evidencing such payment (provided that the Optionee may delete information unrelated to the Parachute Payment or Excise Tax and provided,  further that the Company at all times shall treat such returns as confidential and use such return only for purpose contemplated by this paragraph). 

(f)In the event of any controversy with the Internal Revenue Service (or other taxing authority) with regard to the Excise Tax, the Optionee shall permit the Company to control issues related to the Excise Tax (at its expense), provided that such issues do not potentially materially adversely affect the Optionee but the Optionee shall control any other issues.  In the event that the issues are interrelated, the Optionee and the Company shall in good faith cooperate so as not to jeopardize resolution of either issue.  In the event of any conference with any taxing authority as to the Excise Tax or associated income taxes, the Optionee shall permit the representative of the Company to accompany the Optionee, and the Optionee and his representative shall cooperate with the Company and its representative.

(g)The Company shall be responsible for all charges of the Accountants.

(h)The Company and the Optionee shall promptly deliver to each other copies of any written communications, and summaries of any verbal communications, with any taxing authority regarding the Excise Tax covered by this Exhibit A.

(i)Nothing in this Exhibit A is intended to violate the Sarbanes-Oxley Act of 2002 and to the extent that any advance or repayment obligation hereunder would do so, such obligation shall be modified so as to make the advance a nonrefundable payment to the Optionee and the repayment obligation null and void.

(j)Notwithstanding the foregoing, any payment or reimbursement made pursuant to this Exhibit A shall be paid to the Optionee promptly and in no event later than the end of the calendar year next following the calendar year in which the related tax is paid by the Optionee or where no taxes are required to be remitted, the end of the Optionee’s calendar year following the

Optionee’s calendar year in which the audit is completed or there is a final and nonappealable settlement or other resolution of the litigation.

(k)The provisions of this Exhibit A shall survive the termination of the Optionee’s employment with the Company for any reason and the termination of the Award Agreement.

EX-10.5

Exhibit 10.5

DIRECTOR FORM

FORM OF AT HOME GROUP INC. 2016 EQUITY INCENTIVE PLAN

RESTRICTED STOCK UNIT - NOTICE OF GRANT

(DIRECTOR)

At Home Group Inc. (the “Company”), a Delaware corporation, hereby grants to the Grantee set forth below (the “Grantee”) Restricted Stock Units (the “Restricted Stock Units”), pursuant to the terms and conditions of this Notice of Grant (the “Notice”), the Restricted Stock Unit Director Award Agreement (reference number 2018‑A) attached hereto as Exhibit A (the “Award Agreement”), and the At Home Group Inc. 2016 Equity Incentive Plan (the “Plan”). Capitalized terms used but not defined herein shall have the meaning attributed to such terms in the Award Agreement or, if not defined therein, in the Plan, unless the context requires otherwise. Each Restricted Stock Unit represents the right to receive one (1) Share at the time and in the manner set forth in Section 4 of the Award Agreement.

Date of Grant:	[]
Name of Grantee:	[]
Number of Restricted Stock Units:	[]
Vesting:	The Restricted Stock Units shall vest pursuant to the terms and conditions set forth in Section 3 of the Award Agreement.
Vesting Start Date:	[]

The Restricted Stock Units shall be subject to the execution and return of this Notice by the Grantee to the Company within 30 days of the date hereof (including by utilizing an electronic signature and/or web-based approval and notice process or any other process as may be authorized by the Company). By executing this Notice, the Grantee acknowledges that his or her agreement to the covenants set forth in Section 6 of the Award Agreement is a material inducement to the Company in granting this Award to the Grantee.

This Notice may be executed by facsimile or electronic means (including, without limitation, PDF) and in one or more counterparts, each of which shall be considered an original instrument, but all of which together shall constitute one and the same agreement, and shall become binding when one or more counterparts have been signed by each of the parties hereto and delivered to the other party hereto.

[Signature Page Follows]

IN WITNESS WHEREOF, the parties hereto have executed this Notice of Grant as of the Date of Grant set forth above.

AT HOME GROUP INC.
By:
Name:
Title:
GRANTEE
Name:	[]

[SIGNATURE PAGE TO NOTICE OF DIRECTOR RESTRICTED STOCK UNIT GRANT FOR AT  HOME GROUP INC. 2016 EQUITY INCENTIVE PLAN]

Exhibit A

AT HOME GROUP INC.

2016 EQUITY INCENTIVE PLAN

RESTRICTED STOCK UNIT

DIRECTOR AWARD AGREEMENT

Reference Number: 2018‑A

THIS RESTRICTED STOCK UNIT DIRECTOR AWARD AGREEMENT (the “Award Agreement”) is entered into by and among At Home Group Inc. (the “Company”) and the individual set forth on the signature page to that certain Notice of Grant (the “Notice”) to which this Award Agreement is attached. The terms and conditions of the Restricted Stock Units granted hereby, to the extent not controlled by the terms and conditions contained in the Plan, shall be as set forth in the Notice and this Award Agreement. Capitalized terms used but not defined herein shall have the meaning attributed to such terms in the Notice or, if not defined therein, in the Plan, unless the context requires otherwise.

1.No Right to Continued Employee Status or Consultant Service

Nothing contained in this Award Agreement shall confer upon the Grantee the right to the continuation of his or her Employee status, or, in the case of a Consultant or Director, to the continuation of his or her service arrangement, or in either case to interfere with the right of the Company or any of its Subsidiaries or other Affiliates to Terminate the Grantee.

2.Term of Restricted Stock Units

As a general matter, the Restricted Stock Units will expire on the Expiration Date set forth in the Notice and be deemed to have been forfeited by the Grantee. As provided below, the Restricted Stock Units may expire prior to the Expiration Date if the Grantee Terminates, including in the event of the Grantee’s Disability or death. This Award Agreement shall remain in effect until the Restricted Stock Units have fully vested and been settled or been forfeited by the Grantee as provided in this Award Agreement. No portion of the Restricted Stock Units shall remain outstanding after the Expiration Date, or such earlier date as may be applicable, except as provided herein.

3.Vesting of Restricted Stock Units.

Subject to the remainder of this Section 3, 100% of the Restricted Stock Units shall vest on the first anniversary of the Vesting Start Date, subject to the Grantee’s not having Terminated prior to such first anniversary. If the Grantee Terminates for any reason prior to the first anniversary of the Vesting Start Date, the Restricted Stock Units shall terminate upon such Termination and be deemed to have been forfeited by the Grantee without consideration. Notwithstanding the foregoing, the Restricted Stock Units to the extent then issued and outstanding, shall become fully (100%) vested upon the Grantee’s Termination by the Company without Cause on or within one year following the consummation of a Change in Control.

4.Settlement

Within thirty (30) days following the date on which any portion of the Restricted Stock Units vest pursuant to Section 3 of this Award Agreement, the Company shall deliver to the Grantee one (1) Share in settlement of each Restricted Stock Unit that becomes vested on such vesting date.

5.Termination of Service

If the Grantee incurs a Termination for any reason, whether voluntarily or involuntarily, then the portion of the Restricted Stock Units that have not previously vested shall terminate as of the date of the Grantee’s Termination. If the Grantee incurs a Termination for Cause, then the Restricted Stock Units (whether or not vested) shall be forfeited and terminate immediately without consideration upon the effective date of such Termination for Cause.

6.Prohibited Activities

(a) No Sale or Transfer. Unless otherwise required by law, the Restricted Stock Units shall not be (i) sold, transferred or otherwise disposed of, (ii) pledged or otherwise hypothecated or (iii) subject to attachment, execution or levy of any kind, other than by will or by the laws of descent or distribution; provided,  however, that any transferred Restricted Stock Units will be subject to all of the same terms and conditions as provided in the Plan and this Award Agreement and the Grantee’s estate or beneficiary appointed in accordance with the Plan will remain liable for any withholding tax that may be imposed by any federal, state or local tax authority.

(b) Right to Terminate Restricted Stock Units and Recovery. The Grantee understands and agrees that the Company has granted the Restricted Stock Units to the Grantee to reward the Grantee for the Grantee’s future efforts and loyalty to the Company and its Affiliates by giving the Grantee the opportunity to participate in the potential future appreciation of the Company. Accordingly, if (a) the Grantee materially violates the Grantee’s obligations relating to the non-disclosure or non-use of confidential or proprietary information under any Restrictive Agreement to which the Grantee is a party, or (b) the Grantee materially breaches or violates the Grantee’s obligations relating to non-disparagement under any Restrictive Agreement to which the Grantee is a party, or (c) the Grantee engages in any activity prohibited by Section 6 of this Award Agreement, or (d) the Grantee materially breaches or violates any non-solicitation obligations under any Restrictive Agreement to which the Grantee is a party, or (e) the Grantee breaches or violates any non-competition obligations under any Restrictive Agreement to which the Grantee is a party, or (f) the Grantee is convicted of a felony against the Company or any of its Affiliates, then, in addition to any other rights and remedies available to the Company, the Company shall be entitled, at its option, exercisable by written notice, to terminate the Restricted Stock Units (including the vested portion of the Restricted Stock Units) without consideration, which shall be of no further force and effect. “Restrictive Agreement” shall mean any agreement between the Company or any Subsidiary and the Grantee that contains non-

competition, non-solicitation, non-hire, non-disparagement, or confidentiality restrictions applicable to the Grantee.

(c) Other Remedies. The Grantee specifically acknowledges and agrees that its remedies under this Section 6 shall not prevent the Company or any Subsidiary from seeking injunctive or other equitable relief in connection with the Grantee’s breach of any Restrictive Agreement. In the event that the provisions of this Section 6 should ever be deemed to exceed the limitation provided by applicable law, then the Grantee and the Company agree that such provisions shall be reformed to set forth the maximum limitations permitted.

7.No Rights as Stockholder

The Grantee shall have no rights as a stockholder with respect to the Shares covered by the Restricted Stock Units until the effective date of issuance of the Shares and the entry of the Grantee’s name as a shareholder of record on the books of the Company following delivery of the Shares in settlement of the Restricted Stock Units.

8.Taxation Upon Settlement of the Restricted Stock Units; Tax Withholding; Parachute Tax Provisions

The Grantee understands that the Grantee will recognize income, for Federal, state and local income tax purposes, as applicable, in respect of the vesting and/or settlement of the Restricted Stock Units. The acceptance of the Shares by the Grantee shall constitute an agreement by the Grantee to report such income in accordance with then applicable law and to cooperate with Company and its subsidiaries in establishing the amount of such income and corresponding deduction to the Company and/or its subsidiaries for its income tax purposes.

The Grantee is responsible for all tax obligations that arise as a result of the vesting and settlement of the Restricted Stock Units. The Company may withhold from any amount payable to the Grantee an amount sufficient to cover any Federal, state or local withholding taxes which may become required with respect to such vesting and settlement or take any other action it deems necessary to satisfy any income or other tax withholding requirements as a result of the vesting and settlement of the Restricted Stock Units. The Company shall have the right to require the payment of any such taxes and require that the Grantee, or the Grantee’s beneficiary, to furnish information deemed necessary by the Company to meet any tax reporting obligation as a condition to delivery of any Shares pursuant to settlement of the Restricted Stock Units. The Grantee may pay his or her withholding tax obligation in connection with the vesting and settlement of the Restricted Stock Units, by making a cash payment to the Company. In addition, the Committee, in its sole discretion, may allow the Grantee, to pay his or her withholding tax obligation in connection with the vesting and settlement of the Restricted Stock Units, by (x) having withheld a portion of the Shares then issuable to him or her upon settlement of the Restricted Stock Units or (z) surrendering Shares that have been held by the Grantee for at least six (6) months (or such lesser period as may be permitted by the Committee) prior to the settlement of the Restricted Stock Units, in each case having an aggregate Fair Market Value equal to the withholding taxes.

In connection with the grant of the Restricted Stock Units, the parties wish to memorialize their agreement regarding the treatment of any potential golden parachute payments as set forth in Exhibit A attached hereto.

9.Securities Laws

Upon the acquisition of any Shares pursuant to the settlement of the Restricted Stock Units, the Grantee will make such written representations, warranties, and agreements as the Committee may reasonably request in order to comply with securities laws or with this Award Agreement. Grantee hereby agrees not to offer, sell or otherwise attempt to dispose of any Shares issued to the Grantee upon settlement of the Restricted Stock Units in any way which would: (x) require the Company to file any registration statement with the Securities and Exchange Commission (or any similar filing under state law or the laws of any other county) or to amend or supplement any such filing or (y) violate or cause the Company to violate the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, the rules and regulations promulgated thereunder, or any other Federal, state or local law, or the laws of any other country. The Company reserves the right to place restrictions on any Shares the Grantee may receive as a result of the settlement of the Restricted Stock Units.

10.Modification, Amendment, and Termination of Restricted Stock Units

This Award Agreement may not be modified, amended, terminated and no provision hereof may be waived in whole or in part except by a written agreement signed by the Company and the Grantee and no modification shall, without the consent of the Grantee, alter to the Grantee’s material detriment or materially impair any rights of the Grantee under this Award Agreement except to the extent permitted under the Plan.

11.Notices

Unless otherwise provided herein, any notices or other communication given or made pursuant to the Notice, this Award Agreement or the Plan shall be in writing and shall be deemed to have been duly given (i) as of the date delivered, if personally delivered (including receipted courier service) or overnight delivery service, with confirmation of receipt; (ii) on the date the delivering party receives confirmation, if delivered by facsimile to the number indicated or by email to the address indicated or through an electronic administrative system designated by the Company; (iii) one (1) business day after being sent by reputable commercial overnight delivery service courier, with confirmation of receipt; or (iv) three (3) business days after being mailed by registered or certified mail, return receipt requested, postage prepaid and addressed to the intended recipient as set forth below:

(a) If to the Company at the address below:

At Home Group Inc.

1600 East Plano Parkway

Plano, Texas 75074

Attn: General Counsel

Phone: (972) 265‑6227

(b) If to the Grantee, at the most recent address, facsimile number or email contained in the Company’s records.

12.Award Agreement Subject to Plan and Applicable Law

This Award Agreement is made pursuant to the Plan and shall be interpreted to comply therewith. A copy of the Plan is attached hereto. Any provision of this Award Agreement inconsistent with the Plan shall be considered void and replaced with the applicable provision of the Plan. The Plan shall control in the event there shall be any conflict between the Plan, the Notice, and this Award Agreement, and it shall control as to any matters not contained in this Award Agreement. The Committee shall have authority to make constructions of this Award Agreement, and to correct any defect or supply any omission or reconcile any inconsistency in this Award Agreement, and to prescribe rules and regulations relating to the administration of this Award and other Awards granted under the Plan.

This Award Agreement shall be governed by the laws of the State of Delaware, without regard to the conflicts of law principles thereof, and subject to the exclusive jurisdiction of the courts therein. The Grantee hereby consents to personal jurisdiction in any action brought in any court, federal or state, within the State of Delaware having subject matter jurisdiction in the matter.

13.Section 409A

The Restricted Stock Units are intended to be exempt from Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and, accordingly, to the maximum extent permitted, this Award Agreement shall be interpreted to be exempt from Section 409A of the Code or, if not exempt, in compliance therewith. Nothing contained herein shall constitute any representation or warranty by the Company regarding compliance with Section 409A of the Code. The Company shall have no obligation to take any action to prevent the assessment of any additional income tax, interest or penalties under Section 409A of the Code on any Person and the Company, its Subsidiaries and Affiliates, and each of their respective employees and representatives, shall have no liability to the Grantee with respect thereto.

14.Headings and Capitalized Terms

Unless otherwise provided herein, capitalized terms used herein that are defined in the Plan and not defined herein shall have the meanings set forth in the Plan. Headings are for convenience only and are not deemed to be part of this Award Agreement. Unless otherwise indicated, any reference to a Section herein is a reference to a Section of this Award Agreement.

15.Severability and Reformation

If any provision of this Award Agreement shall be determined by a court of law of competent jurisdiction to be unenforceable for any reason, such unenforceability shall not affect the enforceability of any of the remaining provisions hereof; and this Award Agreement, to the fullest extent lawful, shall be reformed and construed as if such unenforceable provision, or part thereof, had never been contained herein, and such provision or part thereof shall be reformed or construed so that it would be enforceable to the maximum extent legally possible.

16.Binding Effect

This Award Agreement shall be binding upon the parties hereto, together with their personal executors, administrator, successors, personal representatives, heirs and permitted assigns.

17.Entire Agreement

This Award Agreement, together with the Plan, supersedes all prior written and oral agreements and understandings among the parties as to its subject matter and constitutes the entire agreement of the parties with respect to the subject matter hereof. If there is any conflict between the Notice, this Award Agreement and the Plan, then the applicable terms of the Plan shall govern.

18.Waiver

Waiver by any party of any breach of this Award Agreement or failure to exercise any right hereunder shall not be deemed to be a waiver of any other breach or right whether or not of the same or a similar nature. The failure of any party to take action by reason of such breach or to exercise any such right shall not deprive the party of the right to take action at any time while or after such breach or condition giving rise to such rights continues.

Exhibit A

PARACHUTE TAX PROVISIONS

This Exhibit A sets forth the terms and provisions applicable to the Grantee pursuant to the provisions of Section 8 of the Award Agreement. This Exhibit A shall be subject in all respects to the terms and conditions of the Award Agreement.

(a) To the extent that the Grantee, would otherwise be eligible to receive a payment or benefit pursuant to the terms of this Award Agreement, any employment or other agreement with the Company or any Subsidiary or otherwise in connection with, or arising out of, the Grantee’s employment with the Company or a change in ownership or effective control of the Company or of a substantial portion of its assets (any such payment or benefit, a “Parachute Payment”), that a nationally recognized United States public accounting firm selected by the Company (the “Accountants”) determines, but for this sentence would be subject to excise tax imposed by Section 4999 of the Code (the “Excise Tax”), subject to clause (c) below, then the Company shall pay to the Grantee whichever of the following two alternative forms of payment would result in the Grantee’s receipt, on an after-tax basis, of the greater amount of the Parachute Payment notwithstanding that all or some portion of the Parachute Payment may be subject to the Excise Tax: (1) payment in full of the entire amount of the Parachute Payment (a “Full Payment”), or (2) payment of only a part of the Parachute Payment so that the Grantee receives the largest payment possible without the imposition of the Excise Tax (a “Reduced Payment”).

(b) If a reduction in the Parachute Payment is necessary pursuant to clause (a), then the reduction shall occur in the following order: (1) cancellation of acceleration of vesting on any equity awards for which the exercise price exceeds the then fair market value of the underlying equity; (2) reduction of cash payments (with such reduction being applied to the payments in the reverse order in which they would otherwise be made, that is, later payments shall be reduced before earlier payments); and (3) cancellation of acceleration of vesting of equity awards not covered under (1) above; provided,  however, that in the event that acceleration of vesting of equity awards is to be cancelled, acceleration of vesting of full value awards shall be cancelled before acceleration of options and stock appreciation rights and within each class such acceleration of vesting shall be cancelled in the reverse order of the date of grant of such equity awards, that is, later equity awards shall be canceled before earlier equity awards; and provided,  further, that to the extent permitted by Code Section 409A and Sections 280G and 4999 of the Code, if a different reduction procedure would be permitted without violating Code Section 409A or losing the benefit of the reduction under Sections 280G and 4999 of the Code, the Grantee may designate a different order of reduction.

(c) For purposes of determining whether any of the Parachute Payments (collectively the “Total Payments”) will be subject to the Excise Tax and the amount of such Excise Tax, (i) the Total Payments shall be treated as “parachute payments” within the meaning of Section 280G(b)(2) of the Code, and all “parachute payments” in excess of the “base amount” (as defined under Section 280G(b)(3) of the Code) shall be treated as subject to the Excise Tax, unless and except to the extent that, in the opinion of the

Accountants, such Total Payments (in whole or in part):  (1) do not constitute “parachute payments,” including giving effect to the recalculation of stock options in accordance with Treasury Regulation Section 1.280G‑1, Q&A 33, (2) represent reasonable compensation for services actually rendered within the meaning of Section 280G(b)(4) of the Code in excess of the “base amount” or (3) are otherwise not subject to the Excise Tax, and (ii) the value of any non-cash benefits or any deferred payment or benefit shall be determined by the Accountants in accordance with the principles of Section 280G of the Code.

(d) All determinations hereunder shall be made by the Accountants, which determinations shall be final and binding upon the Company and the Grantee.

(e) The federal tax returns filed by the Grantee (and any filing made by a consolidated tax group which includes the Company) shall be prepared and filed on a basis consistent with the determination of the Accountants with respect to the Excise Tax payable by the Grantee. The Grantee shall make proper payment of the amount of any Excise Tax, and at the request of the Company, provide to the Company true and correct copies (with any amendments) of his or her federal income tax return as filed with the Internal Revenue Service, and such other documents reasonably requested by the Company, evidencing such payment (provided that the Grantee may delete information unrelated to the Parachute Payment or Excise Tax and provided,  further that the Company at all times shall treat such returns as confidential and use such return only for purpose contemplated by this paragraph).

(f) In the event of any controversy with the Internal Revenue Service (or other taxing authority) with regard to the Excise Tax, the Grantee shall permit the Company to control issues related to the Excise Tax (at its expense), provided that such issues do not potentially materially adversely affect the Grantee but the Grantee shall control any other issues. In the event that the issues are interrelated, the Grantee and the Company shall in good faith cooperate so as not to jeopardize resolution of either issue. In the event of any conference with any taxing authority as to the Excise Tax or associated income taxes, the Grantee shall permit the representative of the Company to accompany the Grantee, and the Grantee and his representative shall cooperate with the Company and its representative.

(g) The Company shall be responsible for all charges of the Accountants.

(h) The Company and the Grantee shall promptly deliver to each other copies of any written communications, and summaries of any verbal communications, with any taxing authority regarding the Excise Tax covered by this Exhibit A.

(i) Nothing in this Exhibit A is intended to violate the Sarbanes-Oxley Act of 2002 and to the extent that any advance or repayment obligation hereunder would do so, such obligation shall be modified so as to make the advance a nonrefundable payment to the Grantee and the repayment obligation null and void.

(j) Notwithstanding the foregoing, any payment or reimbursement made pursuant to this Exhibit A shall be paid to the Grantee promptly and in no event later than the end of the calendar year next following the calendar year in which the related tax is

paid by the Grantee or where no taxes are required to be remitted, the end of the Grantee’s calendar year following the Grantee’s calendar year in which the audit is completed or there is a final and nonappealable settlement or other resolution of the litigation.

(k) The provisions of this Exhibit A shall survive the termination of the Grantee’s employment with the Company for any reason and the termination of the Award Agreement.

EX-10.6

Exhibit 10.6

AMENDMENT TO EMPLOYMENT AGREEMENT

THIS AMENDMENT (the “Amendment”) is entered into as of June 7, 2018 by and between At Home RMS Inc., as assignee from Garden Ridge Corporation (the “Company”) and Judd Nystrom (the “Executive”).

WHEREAS, the Executive is party to that certain employment agreement dated as of January 25, 2013 by and between the Executive, the Company, and, solely for purposes of Section 2.3 thereof, At Home Group Inc. f/k/a GRD Holding I Corporation, as modified by that certain amendment dated as of November 1, 2013 (collectively, the “Employment Agreement”). Capitalized terms used but not defined herein shall have the meanings set forth in the Employment Agreement;

WHEREAS, the parties hereto desire to amend the Employment Agreement as provided in this Amendment.

NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby agreed and acknowledge, the parties hereto agree as follows:

1. The Employment Agreement is hereby amended by deleting Section 3.5 (Cooperation) in its entirety and replacing it with the following:

“3.5. Cooperation. Following the termination of the Executive’s employment with the Company for any reason, the Executive shall reasonably cooperate with the Company upon reasonable request of the Board and be reasonably available to the Company (taking into account any other full-time employment of the Executive) with respect to matters arising out of the Executive’s services to the Company and its subsidiaries. If the Executive resigns his employment, whether or not for Good Reason, then, subject to the Executive’s compliance with the obligations set forth in this Section 3.5, as reasonably determined by the Company in good faith, the Compensation Committee of the Board (the “Committee”) may, in its sole discretion, provide for a cash payment to the Executive of up to $2 million (the “Cooperation Payment”), which Cooperation Payment, if any, shall be paid to the Executive within thirty (30) days following the date on which the Committee determines the Executive has complied with this Section 3.5.”

2. The Employment Agreement, together with this Amendment, constitutes the entire agreement between the parties hereto with respect to the subject matter hereof, and supersedes all prior representations, agreements, and understandings (including any prior course of dealings), whether written or oral, between the parties hereto with respect to the subject matter hereof.

3. This Amendment shall be construed and enforced in accordance with, and the laws of the State of New York hereto shall govern the rights and obligations of the parties, without giving effect to the conflicts of law principles thereof.

4. This Amendment may be executed by facsimile or electronic transmission (e.g., “pdf”) and in any number of counterparts, each of which shall be deemed an original, but all such counterparts shall together constitute one and the same instrument.

[Signature Page Follows]

IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the date first written above.

AT HOME RMS INC.
By:	/s/ Mary Jane Broussard
Name:	Mary Jane Broussard
Title:	SVP, General Counsel
EXECUTIVE
/s/ Judd T. Nystrom
Judd Nystrom

[SIGNATURE PAGE TO NYSTROM EMPLOYMENT AGREEMENT AMENDMENT]

EX-31.1

EXHIBIT 31.1

SECTION 302 CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

I, Lewis L. Bird III, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q for the quarterly period ended April 28, 2018 of At Home Group Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(c) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: June 7, 2018

/s/ LEWIS L. BIRD III

Lewis L. Bird III

Chairman of the Board and Chief Executive Officer

EX-31.2

EXHIBIT 31.2

SECTION 302 CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

I, Judd T. Nystrom, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q for the quarterly period ended April 28, 2018 of At Home Group Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

(a)    Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)   Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(c)    Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)    Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: June 7, 2018

/s/ JUDD T. NYSTROM

Judd T. Nystrom

Chief Financial Officer

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of At Home Group Inc. (the “Company”), for the quarterly period ended April 28, 2018, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), each of the undersigned officers of the Company certifies pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to his knowledge: 

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: June 7, 2018	/s/ LEWIS L. BIRD III
	Lewis L. Bird III
	Chairman of the Board and Chief Executive Officer (Principal Executive Officer)

Date: June 7, 2018	/s/ JUDD T. NYSTROM
	Judd T. Nystrom
	Chief Financial Officer (Principal Financial Officer)

The foregoing certification is being furnished solely pursuant to 18 U.S.C. § 1350 and is not being filed as part of the Report or as a separate disclosure document.

XML

Document and Entity Information - shares	3 Months Ended
	Apr. 28, 2018	Jun. 04, 2018
Document and Entity Information [Abstract]
Entity Registrant Name	AT HOME GROUP INC.
Entity Central Index Key	0001646228
Document Type	10-Q
Document Period End Date	Apr. 28, 2018
Amendment Flag	false
Current Fiscal Year End Date	--01-26
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		62,849,640
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q1

XML

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Apr. 28, 2018	Jan. 27, 2018	Apr. 29, 2017
Current assets:
Cash and cash equivalents	$ 13,532	$ 8,525	$ 10,576
Inventories, net	283,107	269,844	252,116
Prepaid expenses	9,239	7,911	6,939
Other current assets	9,234	14,653	5,216
Total current assets	315,112	300,933	274,847
Property and equipment, net	528,710	466,263	375,541
Goodwill	569,732	569,732	569,732
Trade name	1,458	1,458	1,458
Debt issuance costs, net	1,868	1,978	1,081
Restricted cash	2,515		564
Noncurrent deferred tax asset	39,277	33,561	40,516
Other assets	736	316	407
Total assets	1,459,408	1,374,241	1,264,146
Current liabilities:
Accounts payable	76,194	79,628	63,687
Accrued and other current liabilities	92,758	89,499	73,095
Revolving line of credit	183,500	162,000	126,800
Current portion of deferred rent	10,512	9,072	7,291
Current portion of long-term debt and financing obligations	3,600	3,474	3,664
Income taxes payable	1,583		13,442
Total current liabilities	368,147	343,673	287,979
Long-term debt	289,397	289,902	299,403
Financing obligations	28,152	19,690	19,882
Deferred rent	147,605	124,054	105,959
Other long-term liabilities	5,508	6,043	2,715
Total liabilities	838,809	783,362	715,938
Shareholders' Equity
Common stock; $0.01 par value; 500,000,000 shares authorized; 62,354,101, 61,423,398 and 60,366,768 shares issued and outstanding, respectively	624	614	604
Additional paid-in capital	583,837	572,488	551,590
Retained earnings (accumulated deficit)	36,138	17,777	(3,986)
Total shareholders' equity	620,599	590,879	548,208
Total liabilities and shareholders' equity	$ 1,459,408	$ 1,374,241	$ 1,264,146

XML

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Apr. 28, 2018	Jan. 27, 2018	Apr. 29, 2017
Condensed Consolidated Balance Sheets
Common stock par value (in dollars per share)	$ 0.01	$ 0.01	$ 0.01
Common stock, authorized	500,000,000	500,000,000	500,000,000
Common stock, shares issued	62,354,101	61,423,398	60,366,768
Common stock, outstanding shares	62,354,101	61,423,398	60,366,768

XML

Condensed Consolidated Statements of Income - USD ($) $ in Thousands	3 Months Ended
	Apr. 28, 2018	Apr. 29, 2017
Condensed Consolidated Statements of Income
Net sales	$ 256,161	$ 211,841
Cost of sales	170,917	139,963
Gross profit	85,244	71,878
Operating expenses
Selling, general and administrative expenses	59,465	49,141
Depreciation and amortization	1,579	1,418
Total operating expenses	61,044	50,559
Operating income	24,200	21,319
Interest expense, net	5,778	4,886
Income before income taxes	18,422	16,433
Income tax provision	61	6,384
Net income	$ 18,361	$ 10,049
Net income per common share:
Basic (in dollars per share)	$ 0.30	$ 0.17
Diluted (in dollars per share)	$ 0.28	$ 0.16
Weighted average shares outstanding:
Basic (in shares)	61,758,330	60,366,768
Diluted (in shares)	65,889,163	62,265,248

XML

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Apr. 28, 2018	Apr. 29, 2017
Operating Activities
Net income	$ 18,361	$ 10,049
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	11,456	10,836
Loss (gain) on disposal of fixed assets	31	(18)
Non-cash interest expense	501	465
Amortization of deferred gain on sale-leaseback	(1,978)	(1,468)
Deferred income taxes	(5,716)	219
Stock-based compensation	2,128	3,289
Changes in operating assets and liabilities
Inventories	(13,264)	(8,321)
Prepaid expenses and other current assets	4,091	(3,088)
Other assets	(420)	142
Accounts payable	(5,263)	3,335
Accrued liabilities	(9,117)	(4,711)
Income taxes payable	1,583	6,177
Deferred rent	4,315	3,944
Net cash provided by operating activities	6,708	20,850
Investing Activities
Purchase of property and equipment	(78,587)	(40,897)
Net proceeds from sale of property and equipment	49,637	18
Net cash used in investing activities	(28,950)	(40,879)
Financing Activities
Payments under lines of credit	(131,000)	(74,476)
Proceeds from lines of credit	152,500	99,701
Payments on financing obligations	(139)	(34)
Payments on long-term debt	(828)	(1,596)
Proceeds from exercise of stock options	9,231
Net cash provided by financing activities	29,764	23,595
Increase in cash, cash equivalents and restricted cash	7,522	3,566
Cash, cash equivalents and restricted cash, beginning of period	8,525	7,574
Cash, cash equivalents and restricted cash, end of period	16,047	11,140
Supplemental Cash Flow Information
Cash paid for interest	5,033	7,902
Cash (received) paid for income taxes	(160)	191
Supplemental Information for Non-cash Investing and Financing Activities
Increase in current liabilities of property and equipment	13,670	4,123
Property and equipment reduction due to sale leaseback	(26,982)
Property and equipment acquired under capital lease		$ 1,000
Property and equipment additions due to build-to-suit lease transactions	$ 8,660

XML

Summary of Significant Accounting Policies

3 Months Ended

Apr. 28, 2018

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

1.    Summary of Significant Accounting Policies

Basis of Presentation

These condensed consolidated financial statements include At Home Group Inc. and its wholly-owned subsidiaries (collectively referred to as “we”, “us”, “our” and the “Company”).

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information in accordance with Article 10 of Regulation S-X. In the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of the results of operations, financial position and cash flows for the periods presented have been included.

The condensed consolidated balance sheets as of April 28, 2018 and April 29, 2017, the condensed consolidated statements of income for the thirteen weeks ended April 28, 2018 and April 29, 2017 and the condensed consolidated statements of cash flows for the thirteen weeks ended April 28, 2018 and April 29, 2017 have been prepared by the Company and are unaudited. The consolidated balance sheet as of January 27, 2018 has been derived from the audited financial statements for the fiscal year then ended included in our Annual Report on Form 10-K for the fiscal year ended January 27, 2018 as filed with the Securities and Exchange Commission (“SEC”) on March 23, 2018 (the “Annual Report”), but does not include all of the information and notes required by GAAP for complete financial statements. These interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements as of and for the fiscal years ended January 27, 2018 and January 28, 2017 and the related notes thereto included in the Annual Report.

The Company does not have any components of other comprehensive income recorded within its condensed consolidated financial statements, and, therefore, does not separately present a statement of comprehensive income in its condensed consolidated financial statements.

Fiscal Year

We report on the basis of a 52- or 53-week fiscal year, which ends on the last Saturday in January. References to a fiscal year mean the year in which that fiscal year ends. References herein to “first fiscal quarter 2019” relate to the thirteen weeks ended April 28, 2018 and references to “first fiscal quarter 2018” relate to the thirteen weeks ended April 29, 2017.

Consolidation

The accompanying condensed consolidated financial statements include the accounts of At Home Group Inc. and its consolidated wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of these condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of sales and expenses during the reporting period. Actual results could differ from those estimates.

Reclassification

Certain prior period amounts have been reclassified to conform with the current period presentation within the condensed consolidated financial statements and the accompanying notes.

Seasonality

Our business is moderately seasonal in nature and, therefore, the results of operations for the thirteen weeks ended April 28, 2018 are not necessarily indicative of the operating results that may be expected for a full fiscal year. Historically, our business has realized a slightly higher portion of net sales and operating income in the second and fourth fiscal quarters attributable primarily to the impact of summer and the year-end holiday decorating seasons, respectively.

Restricted Cash

Restricted cash consists of cash and cash equivalents reserved for a specific purpose that is not readily available for immediate or general business use. Our restricted cash balance as of April 28, 2018 consists primarily of cash equivalents held for use in the purchase of property and equipment.

Recent Accounting Pronouncements

In February 2016, the FASB issued ASU No. 2016-02 “Leases”, which supersedes ASC 840 “Leases” and creates a new topic, ASC 842 “Leases” (“ASU 2016-02”). Under ASU 2016-02, an entity will be required to recognize right-of-use assets and lease liabilities on its balance sheet and disclose key information about leasing arrangements. ASU 2016-02 offers specific accounting guidance for a lessee, a lessor and sale and leaseback transactions. Lessees and lessors are required to disclose qualitative and quantitative information about leasing arrangements to enable a user of the financial statements to assess the amount, timing and uncertainty of cash flows arising from leases. ASU 2016-02 is effective for annual reporting periods beginning after December 15, 2018, including interim periods within that reporting period, with early adoption permitted. At adoption, this update will be applied using a modified retrospective approach. We are currently evaluating the impact of ASU 2016-02 and we expect that upon adoption we will recognize right-of-use assets and liabilities that will be material to our financial statements.

In January 2017, the FASB issued ASU No. 2017-04, “Simplifying the Test for Goodwill Impairment” (“ASU 2017-04”). ASU 2017-04 simplifies the measurement of goodwill impairment by removing the second step of the goodwill impairment test, which requires the determination of the fair value of individual assets and liabilities of a reporting unit. Under ASU 2017-04, goodwill impairment is to be measured as the amount by which a reporting unit’s carrying value exceeds its fair value with the loss recognized not to exceed the total amount of goodwill allocated to the reporting unit. ASU 2017-04 is effective for fiscal years beginning after December 15, 2019, with early adoption permitted for interim or annual goodwill impairment tests performed after January 1, 2017. The standard is to be applied on a prospective basis. We are currently evaluating the impact of ASU 2017-04 and do not anticipate a material impact to the consolidated financial statements once implemented.

Recently Adopted Accounting Standards

On January 28, 2018, we adopted ASU No. 2014-09, “Revenue from Contracts with Customers” (“ASU 2014-09”) and ASU No. 2016-04, “Recognition of Breakage for Certain Prepaid Stored-Value Products” (“ASU 2016-04” and together with ASU 2014-09, the “New Revenue Standard” or “ASC 606”) using the full retrospective method. For more information, see Note 2 – Revenue Recognition.

On January 28, 2018, we adopted ASU No. 2016-18, “Restricted Cash” (“ASU 2016-18”) using the required retrospective transition method.  This ASU requires companies to include amounts generally described as restricted cash and restricted cash equivalents in cash and cash equivalents when reconciling beginning-of-period and end-of-period total amounts shown on the statements of cash flows.

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheets that sum to the total of the same such amounts shown in the condensed consolidated statements of cash flows (in thousands):

	April 28, 2018		January 27, 2018		April 29, 2017		January 28, 2017
Cash and cash equivalents	$	13,532	$	8,525	$	10,576	$	7,092
Restricted cash		2,515		—		564		482
Cash, cash equivalents and restricted cash	$	16,047	$	8,525	$	11,140	$	7,574

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Revenue Recognition

3 Months Ended

Apr. 28, 2018

Revenue Recognition

Revenue Recognition

2.    Revenue Recognition

On January 28, 2018, we adopted ASU 2014-09 using the retrospective transition method.  ASU 2014-09 requires a company to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration the company expects to receive in exchange for those goods or services. Results for all reporting periods presented include the impact of the new guidance under ASU 2014-09, including prior periods that have been recast to reflect the estimated cost of returned assets within other current assets rather than netted with our sales returns reserve within other current liabilities. The adoption of ASU 2014-09 did not impact opening retained earnings as of January 28, 2018 and did not have a material impact on revenues recognized for the thirteen weeks ended April 28, 2018. 

The adoption of ASU 2014-09 had the following impact on our condensed consolidated balance sheets as of January 27, 2018 and April 29, 2017 (in thousands):

	Condensed Consolidated Balance Sheet as of January 27, 2018
			New Revenue
	As Reported		Standard		As Recast
Other current assets	$	13,701	$	952	$	14,653
Total current assets		299,981		952		300,933
Total assets		1,373,289		952		1,374,241
Accrued and other current liabilities		88,547		952		89,499
Total current liabilities		342,721		952		343,673
Total liabilities		782,410		952		783,362
Total liabilities and shareholders' equity		1,373,289		952		1,374,241

	Condensed Consolidated Balance Sheet as of April 29, 2017
			New Revenue
	As Reported		Standard		As Recast
Other current assets	$	4,217	$	999	$	5,216
Total current assets		273,848		999		274,847
Total assets		1,263,147		999		1,264,146
Accrued and other current liabilities		72,096		999		73,095
Total current liabilities		286,980		999		287,979
Total liabilities		714,939		999		715,938
Total liabilities and shareholders' equity		1,263,147		999		1,264,146

The adoption of ASU 2014-09 had the following impact on our condensed consolidated statement of cash flows for the thirteen weeks ended April 29, 2017 (in thousands):

	Condensed Consolidated Statement of Cash Flows
	Thirteen Weeks Ended April 29, 2017
			New Revenue
	As Reported(a)		Standard		As Recast
Prepaid expenses and other current assets	$	(3,166)	$	78	$	(3,088)
Accrued liabilities		(4,633)		(78)		(4,711)
Net cash provided by operating activities		20,850		—		20,850

(a) Accrued liabilities have been reclassified in the prior period to conform with the current period presentation as discussed in Note 1 – Summary of Significant Accounting Policies.

We sell a broad assortment of home décor, including home furnishings and accent décor, and recognize revenue when the customer takes possession or control of goods at the time the sale is completed at the store register. Accordingly, we implicitly enter into a contract with customers at the point of sale. In addition to retail store sales, we also generate revenue through the sale of gift cards and through incentive arrangements associated with our credit card program.

As noted in the segment information in the notes to the consolidated financial statements included in our Annual Report, our business consists of one reportable segment. In accordance with ASC 606, we disaggregate net sales into the following product categories:

	Thirteen Weeks Ended
	April 28, 2018		April 29, 2017
Home furnishings	52	%	53	%
Accent décor	44		44
Other	4		3
Total	100	%	100	%

Contract liabilities are recognized primarily for gift card sales. Cash received from the sale of gift cards is recorded as a contract liability in accrued and other current liabilities, and we recognize revenue upon the customer’s redemption of the gift card. Gift card breakage is recognized as revenue in proportion to the pattern of customer redemptions by applying an estimated breakage rate that takes into account historical patterns of redemptions and deactivations of gift cards.

We recognized approximately $3.6 million and $2.7 million in gift card redemption revenue for the thirteen weeks ended April 28, 2018 and April 29, 2017, respectively, and recognized an immaterial amount in gift card breakage revenue for each of the thirteen weeks ended April 28, 2018 and April 29, 2017. Of the total gift card redemption revenue, $1.4 million and $1.5 million for the thirteen weeks ended April 28, 2018 and April 29, 2017, respectively, related to gift cards issued in prior periods. We had outstanding gift card liabilities of $5.8 million, $5.8 million and $4.0 million as of April 28, 2018, January 27, 2018 and April 29, 2017, respectively, which are included in accrued and other current liabilities. Gift card redemption and breakage revenue for the thirteen weeks ended April 28, 2018 and April 29, 2017 and gift card liability as of April 28, 2018, January 27, 2018 and April 29, 2017 reported under ASC 606 were not materially different from amounts that would have been reported under the previous revenue guidance of ASC 605. We will continue to monitor future quarters for materiality.

In fiscal year 2018, we launched a credit card program by which credit is extended to eligible customers through private label and co-branded credit cards with Synchrony Bank (“Synchrony”). Through the launch of the credit card program, we received reimbursement of costs associated with the launch of the credit card program as well as a one-time payment which has been deferred over the initial seven-year term of the agreement with Synchrony. We receive ongoing payments from Synchrony based on sales transacted on our credit cards and for reimbursement of joint marketing and advertising activities. During the thirteen weeks ended April 28, 2018, we recorded an immaterial amount of income from our credit card program within net sales when earned.

Our credit card program includes a loyalty component that allows for customers to earn points for qualifying purchases. Upon reaching specified levels, points are redeemed for certificates usable at our stores. As there are no directly observable selling prices for these points, we are required to account for the points using a relative fair value approach. During the thirteen weeks ended April 28, 2018, we recorded an immaterial amount for the deferral of revenues related to our loyalty program as a reduction of revenues.

Customers may return purchased items for an exchange or refund. Historically, the sales returns reserve was presented net of cost of sales in other current liabilities and based primarily on historical trends and sales performance. ASU 2014-09 also specifies that the balance sheets should reflect both a liability with respect to the refund obligation and an asset representing the right to the returned goods on a gross basis. In adopting ASU 2014-09, we utilized the expected value methodology in which different scenarios including current sales return data and historical quarterly sales return rates are used to develop an estimated sales return rate. During the fiscal year ended January 27, 2018, we utilized the practical expedient provided under ASU 2014-09 to assess all sales on a portfolio basis, as this did not yield materially different results from the actual sales returns. As such,  we now present the sales returns reserve within other current liabilities and the estimated value of the inventory that will be returned within other current assets in the condensed consolidated balance sheets. The components of the sales returns reserve reflected in the condensed consolidated balance sheets consist of the following (in thousands):

	April 28,		January 27,		April 29,
	2019		2018		2017
Accrued and other current liabilities	$	3,332	$	2,023	$	2,365
Other current assets		1,429		952		999
Sales returns reserve, net	$	1,903	$	1,071	$	1,366

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Fair Value Measurements

3 Months Ended

Apr. 28, 2018

Fair Value Measurements

Fair Value Measurements

3.    Fair Value Measurements

We follow the provisions of Accounting Standards Codification (“ASC”) 820 (Topic 820, “Fair Value Measurements and Disclosures”). ASC 820 establishes a three-tiered fair value hierarchy that prioritizes inputs to valuation techniques used in fair value calculations.

· Level 1 - Unadjusted quoted market prices for identical assets or liabilities in active markets that we have the ability to access.

· Level 2 - Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in inactive markets; or valuations based on models where the significant inputs are observable (e.g., interest rates, yield curves, prepayment speeds, default rates, loss severities, etc.) or can be corroborated by observable market data.

· Level 3 - Valuations based on models where significant inputs are not observable. The unobservable inputs reflect our own assumptions about the assumptions that market participants would use.

ASC 820 requires us to maximize the use of observable inputs and minimize the use of unobservable inputs. If a financial instrument uses inputs that fall in different levels of the hierarchy, the instrument is categorized based upon the lowest level of input that is significant to the fair value calculation.

The fair value of all current financial instruments approximates carrying value because of the short-term nature of these instruments. We have variable and fixed rates on our long-term debt. The fair value of long-term debt with variable rates approximates carrying value as the interest rates of these amounts approximate market rates. We determine fair value on our fixed rate debt by using quoted market prices and current interest rates. 

At April 28, 2018, the fair value of our fixed rate mortgage due August 22, 2022 approximated the carrying value of $6.1 million. Fair value for the fixed rate mortgage was determined using Level 2 inputs.

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Sale-Leaseback Transactions

3 Months Ended

Apr. 28, 2018

Sale-Leaseback Transactions

Sale-Leaseback Transactions

4.    Sale-Leaseback Transactions

In February 2018, we sold four of our properties in Blaine, Minnesota; Fort Worth, Texas; Jackson, Mississippi; and Memphis, Tennessee for a total of $50.3 million, resulting in a net gain of $22.6 million. Contemporaneously with the closing of the sale, we entered into a lease pursuant to which we leased back the properties for cumulative initial annual rent of $3.4 million, subject to annual escalations. The lease is being accounted for as an operating lease. The net gain on the sale of the properties has been deferred and is included in deferred rent liabilities in the accompanying condensed consolidated balance sheets. The gain will be amortized to rent expense on a straight-line basis through the lease term, or February 2033.

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Accrued and Other Current Liabilities

3 Months Ended

Apr. 28, 2018

Accrued Liabilities

Accrued Liabilities

5.    Accrued and Other Current Liabilities

Accrued and other current liabilities consist of the following (in thousands):

	April 28,		January 27,		April 29,
	2019		2018		2017
Inventory in-transit	$	10,496	$	14,618	$	13,620
Accrued payroll and other employee-related liabilities		5,858		16,917		4,575
Accrued taxes, other than income		15,500		11,680		13,370
Accrued interest		4,418		4,173		327
Insurance liabilities		3,648		3,391		3,470
Gift card liability		5,800		5,787		4,028
Construction costs		19,947		9,661		10,169
Accrued inbound freight		9,132		10,796		9,110
Other		17,959		12,476		14,426
Total accrued liabilities	$	92,758	$	89,499	$	73,095

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Revolving Line of Credit

3 Months Ended

Apr. 28, 2018

Revolving Line of Credit

Revolving Line of Credit

6.    Revolving Line of Credit

Interest on borrowings under our $350.0 million senior secured asset-based revolving credit facility (“ABL Facility”) is computed based on our average daily availability, at our option, of: (x) the higher of (i) the Federal Funds Rate plus 1/2 of 1.00%, (ii) the bank's prime rate and (iii) the London Interbank Offered Rate (“LIBOR”) plus 1.00%,  plus in each case, an applicable margin of 0.25% to 0.75% or (y) the bank's LIBOR rate plus an applicable margin of 1.25% to 1.75%. The effective interest rate was approximately 3.50% and 2.30% during the thirteen weeks ended April 28, 2018 and April 29, 2017, respectively.

We have amended the agreement governing the ABL Facility (the “ABL Credit Agreement”) from time to time. After giving effect to such amendments, as of April 28, 2018, the aggregate revolving commitments under the ABL Facility are $350.0 million, with a sublimit for the issuance of letters of credit of $50.0 million and a sublimit for the issuance of swingline loans of $20.0 million. In July 2017, in connection with the Seventh Amendment to the ABL Credit Agreement (the “ABL Amendment”), the maturity of the ABL Facility was extended to the earlier of July 27, 2022 and the date that is 91 days prior to the maturity date of the term loan entered into on June 5, 2015 under a first lien credit agreement (the “First Lien Agreement”) (as such date may be extended).

As of April 28, 2018, approximately $183.5 million was outstanding under the ABL Facility, approximately $0.6 million in face amount of letters of credit had been issued and we had availability of approximately $80.9 million. As of April 28, 2018, we were in compliance with all covenants prescribed in the ABL Facility.

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Long-Term Debt

3 Months Ended

Apr. 28, 2018

Long-Term Debt

Long-Term Debt

7.    Long-Term Debt

Long-term debt consists of the following (in thousands):

	April 28,		January 27,		April 29,
	2019		2018		2017
Term Loan	$	291,750	$	292,500	$	294,000
Note payable, bank (a)		6,073		6,108		6,002
Obligations under capital leases		867		911		9,700
Total debt		298,690		299,519		309,702
Less: current maturities		3,319		3,316		3,521
Less: unamortized deferred debt issuance costs		5,974		6,301		6,778
Long-term debt	$	289,397	$	289,902	$	299,403

(a) Matures August 22, 2022; $34,483 payable monthly, including interest at 4.50% with the remaining balance due at maturity; secured by the location’s land and building.

On June 5, 2015, our indirect wholly owned subsidiary, At Home Holding III Inc. (the “Borrower”), entered into the First Lien Agreement, by and among the Borrower, At Home Holding II Inc. (“At Home II”), a direct wholly owned subsidiary of At Home Group Inc., as guarantor, certain indirect subsidiaries of the Borrower, various lenders and Bank of America, N.A., as administrative agent and collateral agent. The First Lien Agreement provides for a $300.0 million term loan (the “Term Loan”), which amount was borrowed on June 5, 2015. The Term Loan will mature on June 3, 2022, and is repayable in equal quarterly installments of approximately $0.8 million for an annual aggregate amount equal to 1% of the original principal amount. The Borrower has the option of paying interest on a 1-month, 2-month or quarterly basis on the Term Loan at an annual rate of LIBOR (subject to a 1% floor) plus 4.00%, subject to a 0.50% reduction if the Borrower achieves a specified secured net leverage ratio level, which was met during the fiscal year ended January 28, 2017 and for which the Borrower has continued to qualify during the thirteen weeks ended April 28, 2018. The Term Loan is prepayable, in whole or in part, without premium at our option.

On July 27, 2017, the Borrower entered into a First Amendment to the First Lien Agreement to permit the incurrence of additional indebtedness pursuant to the ABL Amendment and to make certain technical changes to conform to the terms of the ABL Amendment.

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Related Party Transactions

3 Months Ended

Apr. 28, 2018

Related Party Transactions

Related Party Transactions

8.    Related Party Transactions

As of April 28, 2018, certain affiliates of AEA Investors LP (collectively “AEA”) and Starr Investment Holdings, LLC (“Starr Investments” and, together with AEA, the “Sponsors”) own approximately 61% of our outstanding common stock.

Merry Mabbett Inc. (“MMI”) is owned by Merry Mabbett Dean, who is the mother of Lewis L. Bird III, our Chairman of the Board, Chief Executive Officer and President. During the thirteen weeks ended April 28, 2018 and April 29, 2017, Ms. Dean, through MMI, provided certain design services to us, including design for our home office, as well as design in our stores. In addition, through MMI, we purchased certain fixtures, furniture and equipment that is now owned and used by us in our home office, new store offices or in the product vignettes in the stores. During each of the thirteen weeks ended April 28, 2018 and April 29, 2017, we paid MMI approximately $0.2 million for fixtures, furniture and equipment and design related services.

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Income Taxes

3 Months Ended

Apr. 28, 2018

Income Taxes

Income Taxes

9.    Income Taxes

On December 22, 2017, federal tax reform legislation, known as the Tax Cuts and Jobs Act, was enacted by the U.S. government (the “Tax Act”). The Tax Act makes broad and complex changes to the Internal Revenue Code of 1986, as amended, including, but not limited to, (i) reducing the maximum U.S. federal corporate income tax rate from 35% to 21%; (ii) eliminating the corporate alternative minimum tax (“AMT”) and changing how existing AMT credits are realized; (iii) creating a new limitation on deductible interest expense; and (iv) changing rules related to uses and limitation of net operating loss carryforwards generated in tax years beginning after December 31, 2017. As such, for the fiscal year ended January 26, 2019, the statutory federal corporate income tax rate is 21.0%.

In December of 2017, the Securities and Exchange Commission staff issued State Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (“SAB 118”), which allows us to record provisional amounts during a measurement period not to extend beyond one year from the enactment date. Since the Tax Act was enacted in the fourth fiscal quarter 2018 (and ongoing guidance and accounting interpretations are expected through December of 2018), we consider the accounting of deferred tax re-measurements and other items, such as cost recovery and state tax considerations, to be incomplete due to the forthcoming guidance and our ongoing analysis of final year-end data and tax positions for fiscal years 2019 and 2018. We expect to complete our analysis within the measurement period in accordance with SAB 118.

Our effective tax rate for the thirteen weeks ended April 28, 2018 was 0.3% compared to 38.9 % for the thirteen weeks ended April 29, 2017. The effective tax rate for the thirteen weeks ended April 28, 2018 differs from the current federal statutory rate of 21% primarily due to the recognition of $4.2 million of excess tax benefit related to stock option exercises and the impact of state and local income taxes. The effective tax rate for the thirteen weeks ended April 29, 2017 differs from the previous federal statutory rate of 35% primarily due to the impact of state and local income taxes as well as a strategic restructuring that impacted deferred tax assets.

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Commitments and Contingencies

3 Months Ended

Apr. 28, 2018

Commitments and Contingencies

Commitments and Contingencies

10.    Commitments and Contingencies

Litigation

We are subject to claims and lawsuits that arise primarily in the ordinary course of business.  It is the opinion of management that the disposition or ultimate resolution of such claims and lawsuits will not have a material adverse effect on our consolidated financial position, results of operations or liquidity.

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Earnings Per Share

3 Months Ended

Apr. 28, 2018

Earnings Per Share

Earnings Per Share

11.    Earnings Per Share

In accordance with ASC 260, (Topic 260, “Earnings Per Share”), basic earnings per share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding for the period. Diluted earnings per share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding for the period including the dilutive impact of potential shares from the exercise of stock options and restricted stock units. Potentially dilutive securities are excluded from the computation of diluted net income per share if their effect is anti-dilutive.

The following table sets forth the calculation of basic and diluted earnings per share for the thirteen weeks ended April 28, 2018 and April 29, 2017 as follows (dollars in thousands, except share and per share data):

	Thirteen Weeks Ended
	April 28, 2018		April 29, 2017
Numerator:
Net income	$	18,361	$	10,049
Denominator:
Weighted average common shares outstanding-basic		61,758,330		60,366,768
Effect of dilutive securities:
Stock options and restricted stock units		4,130,833		1,898,480
Weighted average common shares outstanding-diluted		65,889,163		62,265,248
Per common share:
Basic net income per common share	$	0.30	$	0.17
Diluted net income per common share	$	0.28	$	0.16

For the thirteen weeks ended April 28, 2018 and April 29, 2017, approximately 205,882 and 2,743,140, respectively, of stock options were excluded from the calculation of diluted net income per common share since their effect was anti-dilutive.

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Stock-Based Compensation

3 Months Ended

Apr. 28, 2018

Stock-Based Compensation

Stock-Based Compensation

12.    Stock-Based Compensation

On April 3, 2018, we made a grant of 663,247 options to members of our senior management team and 49,189 restricted stock units to our independent directors and members of our senior management team under the At Home Group Inc. Equity Incentive Plan (the “2016 Equity Plan”). Non-cash stock-based compensation expense associated with the grant of options will be approximately $8.5 million, which will be expensed over the requisite service period of three to four years. Non-cash stock-based compensation expense associated with the grant of restricted stock units will be approximately $1.5 million, which will be expensed over the requisite service period of one to three years. Forfeiture assumptions for the grants were estimated based on historical experience.

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Subsequent Events

3 Months Ended

Apr. 28, 2018

Subsequent Events

Subsequent Events

13.    Subsequent Events

In June 2018, our Board of Directors approved a grant of 1.5 million options to Chairman and Chief Executive Officer, Lewis L. Bird III. The options vest immediately upon the June 12, 2018 grant date. However, the shares resulting from the exercise of the options will be generally subject to transfer restrictions that lapse on the fourth anniversary of the date of grant, subject to certain service conditions. In addition, the Board of Directors approved a grant of options with an aggregate grant date fair value in an amount to compensate Mr. Bird for the difference in our share price on June 12, 2018 as compared to our share price on April 3, 2018 when annual equity awards were granted to other Company senior executives. As a result of the immediate vesting of these awards, non-cash stock-based compensation expense will be fully recognized in the second quarter of fiscal 2019.

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Summary of Significant Accounting Policies (Policies)

3 Months Ended

Apr. 28, 2018

Summary of Significant Accounting Policies

Description of Business

Basis of Presentation

These condensed consolidated financial statements include At Home Group Inc. and its wholly-owned subsidiaries (collectively referred to as “we”, “us”, “our” and the “Company”).

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information in accordance with Article 10 of Regulation S-X. In the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of the results of operations, financial position and cash flows for the periods presented have been included.

The condensed consolidated balance sheets as of April 28, 2018 and April 29, 2017, the condensed consolidated statements of income for the thirteen weeks ended April 28, 2018 and April 29, 2017 and the condensed consolidated statements of cash flows for the thirteen weeks ended April 28, 2018 and April 29, 2017 have been prepared by the Company and are unaudited. The consolidated balance sheet as of January 27, 2018 has been derived from the audited financial statements for the fiscal year then ended included in our Annual Report on Form 10-K for the fiscal year ended January 27, 2018 as filed with the Securities and Exchange Commission (“SEC”) on March 23, 2018 (the “Annual Report”), but does not include all of the information and notes required by GAAP for complete financial statements. These interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements as of and for the fiscal years ended January 27, 2018 and January 28, 2017 and the related notes thereto included in the Annual Report.

The Company does not have any components of other comprehensive income recorded within its condensed consolidated financial statements, and, therefore, does not separately present a statement of comprehensive income in its condensed consolidated financial statements.

Fiscal Year

Fiscal Year

We report on the basis of a 52- or 53-week fiscal year, which ends on the last Saturday in January. References to a fiscal year mean the year in which that fiscal year ends. References herein to “first fiscal quarter 2019” relate to the thirteen weeks ended April 28, 2018 and references to “first fiscal quarter 2018” relate to the thirteen weeks ended April 29, 2017.

Consolidation

Consolidation

The accompanying condensed consolidated financial statements include the accounts of At Home Group Inc. and its consolidated wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates

Use of Estimates

The preparation of these condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of sales and expenses during the reporting period. Actual results could differ from those estimates.

Reclassification

Reclassification

Certain prior period amounts have been reclassified to conform with the current period presentation within the condensed consolidated financial statements and the accompanying notes.

Seasonality

Seasonality

Our business is moderately seasonal in nature and, therefore, the results of operations for the thirteen weeks ended April 28, 2018 are not necessarily indicative of the operating results that may be expected for a full fiscal year. Historically, our business has realized a slightly higher portion of net sales and operating income in the second and fourth fiscal quarters attributable primarily to the impact of summer and the year-end holiday decorating seasons, respectively.

Restricted Cash

Restricted Cash

Restricted cash consists of cash and cash equivalents reserved for a specific purpose that is not readily available for immediate or general business use. Our restricted cash balance as of April 28, 2018 consists primarily of cash equivalents held for use in the purchase of property and equipment.

Recent Accounting Pronouncements and Recently Adopted Accounting Standards

Recent Accounting Pronouncements

In February 2016, the FASB issued ASU No. 2016-02 “Leases”, which supersedes ASC 840 “Leases” and creates a new topic, ASC 842 “Leases” (“ASU 2016-02”). Under ASU 2016-02, an entity will be required to recognize right-of-use assets and lease liabilities on its balance sheet and disclose key information about leasing arrangements. ASU 2016-02 offers specific accounting guidance for a lessee, a lessor and sale and leaseback transactions. Lessees and lessors are required to disclose qualitative and quantitative information about leasing arrangements to enable a user of the financial statements to assess the amount, timing and uncertainty of cash flows arising from leases. ASU 2016-02 is effective for annual reporting periods beginning after December 15, 2018, including interim periods within that reporting period, with early adoption permitted. At adoption, this update will be applied using a modified retrospective approach. We are currently evaluating the impact of ASU 2016-02 and we expect that upon adoption we will recognize right-of-use assets and liabilities that will be material to our financial statements.

In January 2017, the FASB issued ASU No. 2017-04, “Simplifying the Test for Goodwill Impairment” (“ASU 2017-04”). ASU 2017-04 simplifies the measurement of goodwill impairment by removing the second step of the goodwill impairment test, which requires the determination of the fair value of individual assets and liabilities of a reporting unit. Under ASU 2017-04, goodwill impairment is to be measured as the amount by which a reporting unit’s carrying value exceeds its fair value with the loss recognized not to exceed the total amount of goodwill allocated to the reporting unit. ASU 2017-04 is effective for fiscal years beginning after December 15, 2019, with early adoption permitted for interim or annual goodwill impairment tests performed after January 1, 2017. The standard is to be applied on a prospective basis. We are currently evaluating the impact of ASU 2017-04 and do not anticipate a material impact to the consolidated financial statements once implemented.

Recently Adopted Accounting Standards

On January 28, 2018, we adopted ASU No. 2014-09, “Revenue from Contracts with Customers” (“ASU 2014-09”) and ASU No. 2016-04, “Recognition of Breakage for Certain Prepaid Stored-Value Products” (“ASU 2016-04” and together with ASU 2014-09, the “New Revenue Standard” or “ASC 606”) using the full retrospective method. For more information, see Note 2 – Revenue Recognition.

On January 28, 2018, we adopted ASU No. 2016-18, “Restricted Cash” (“ASU 2016-18”) using the required retrospective transition method.  This ASU requires companies to include amounts generally described as restricted cash and restricted cash equivalents in cash and cash equivalents when reconciling beginning-of-period and end-of-period total amounts shown on the statements of cash flows.

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheets that sum to the total of the same such amounts shown in the condensed consolidated statements of cash flows (in thousands):

	April 28, 2018		January 27, 2018		April 29, 2017		January 28, 2017
Cash and cash equivalents	$	13,532	$	8,525	$	10,576	$	7,092
Restricted cash		2,515		—		564		482
Cash, cash equivalents and restricted cash	$	16,047	$	8,525	$	11,140	$	7,574

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Summary of Significant Accounting Policies (Tables)

3 Months Ended

Apr. 28, 2018

Summary of Significant Accounting Policies

Schedule of cash, cash equivalents and restricted cash

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheets that sum to the total of the same such amounts shown in the condensed consolidated statements of cash flows (in thousands):

	April 28, 2018		January 27, 2018		April 29, 2017		January 28, 2017
Cash and cash equivalents	$	13,532	$	8,525	$	10,576	$	7,092
Restricted cash		2,515		—		564		482
Cash, cash equivalents and restricted cash	$	16,047	$	8,525	$	11,140	$	7,574

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Revenue Recognition (Tables)

3 Months Ended

Apr. 28, 2018

Revenue Recognition

Schedule of impact on financial statements on adoption of ASU 2014-09

The adoption of ASU 2014-09 had the following impact on our condensed consolidated balance sheets as of January 27, 2018 and April 29, 2017 (in thousands):

	Condensed Consolidated Balance Sheet as of January 27, 2018
			New Revenue
	As Reported		Standard		As Recast
Other current assets	$	13,701	$	952	$	14,653
Total current assets		299,981		952		300,933
Total assets		1,373,289		952		1,374,241
Accrued and other current liabilities		88,547		952		89,499
Total current liabilities		342,721		952		343,673
Total liabilities		782,410		952		783,362
Total liabilities and shareholders' equity		1,373,289		952		1,374,241

	Condensed Consolidated Balance Sheet as of April 29, 2017
			New Revenue
	As Reported		Standard		As Recast
Other current assets	$	4,217	$	999	$	5,216
Total current assets		273,848		999		274,847
Total assets		1,263,147		999		1,264,146
Accrued and other current liabilities		72,096		999		73,095
Total current liabilities		286,980		999		287,979
Total liabilities		714,939		999		715,938
Total liabilities and shareholders' equity		1,263,147		999		1,264,146

The adoption of ASU 2014-09 had the following impact on our condensed consolidated statement of cash flows for the thirteen weeks ended April 29, 2017 (in thousands):

	Condensed Consolidated Statement of Cash Flows
	Thirteen Weeks Ended April 29, 2017
			New Revenue
	As Reported(a)		Standard		As Recast
Prepaid expenses and other current assets	$	(3,166)	$	78	$	(3,088)
Accrued liabilities		(4,633)		(78)		(4,711)
Net cash provided by operating activities		20,850		—		20,850

(a) Accrued liabilities have been reclassified in the prior period to conform with the current period presentation as discussed in Note 1 – Summary of Significant Accounting Policies.

Schedule of disaggregation of revenue

In accordance with ASC 606, we disaggregate net sales into the following product categories:

	Thirteen Weeks Ended
	April 28, 2018		April 29, 2017
Home furnishings	52	%	53	%
Accent décor	44		44
Other	4		3
Total	100	%	100	%

Schedule of components of the sale returns

The components of the sales returns reserve reflected in the condensed consolidated balance sheets consist of the following (in thousands):

	April 28,		January 27,		April 29,
	2019		2018		2017
Accrued and other current liabilities	$	3,332	$	2,023	$	2,365
Other current assets		1,429		952		999
Sales returns reserve, net	$	1,903	$	1,071	$	1,366

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Accrued and Other Current Liabilities (Tables)

3 Months Ended

Apr. 28, 2018

Accrued Liabilities

Schedule of accrued liabilities

Accrued and other current liabilities consist of the following (in thousands):

	April 28,		January 27,		April 29,
	2019		2018		2017
Inventory in-transit	$	10,496	$	14,618	$	13,620
Accrued payroll and other employee-related liabilities		5,858		16,917		4,575
Accrued taxes, other than income		15,500		11,680		13,370
Accrued interest		4,418		4,173		327
Insurance liabilities		3,648		3,391		3,470
Gift card liability		5,800		5,787		4,028
Construction costs		19,947		9,661		10,169
Accrued inbound freight		9,132		10,796		9,110
Other		17,959		12,476		14,426
Total accrued liabilities	$	92,758	$	89,499	$	73,095

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Long-Term Debt (Tables)

3 Months Ended

Apr. 28, 2018

Long-Term Debt

Schedule of long-term debt

Long-term debt consists of the following (in thousands):

	April 28,		January 27,		April 29,
	2019		2018		2017
Term Loan	$	291,750	$	292,500	$	294,000
Note payable, bank (a)		6,073		6,108		6,002
Obligations under capital leases		867		911		9,700
Total debt		298,690		299,519		309,702
Less: current maturities		3,319		3,316		3,521
Less: unamortized deferred debt issuance costs		5,974		6,301		6,778
Long-term debt	$	289,397	$	289,902	$	299,403

(a) Matures August 22, 2022; $34,483 payable monthly, including interest at 4.50% with the remaining balance due at maturity; secured by the location’s land and building.

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Earnings Per Share (Tables)

3 Months Ended

Apr. 28, 2018

Earnings Per Share

Schedule of calculation of basic and diluted earnings per share

The following table sets forth the calculation of basic and diluted earnings per share for the thirteen weeks ended April 28, 2018 and April 29, 2017 as follows (dollars in thousands, except share and per share data):

	Thirteen Weeks Ended
	April 28, 2018		April 29, 2017
Numerator:
Net income	$	18,361	$	10,049
Denominator:
Weighted average common shares outstanding-basic		61,758,330		60,366,768
Effect of dilutive securities:
Stock options and restricted stock units		4,130,833		1,898,480
Weighted average common shares outstanding-diluted		65,889,163		62,265,248
Per common share:
Basic net income per common share	$	0.30	$	0.17
Diluted net income per common share	$	0.28	$	0.16

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Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands	Apr. 28, 2018	Jan. 27, 2018	Apr. 29, 2017	Jan. 28, 2017
Summary of Significant Accounting Policies
Cash and cash equivalents	$ 13,532	$ 8,525	$ 10,576	$ 7,092
Restricted cash	2,515		564	482
Cash, cash equivalents and restricted cash	$ 16,047	$ 8,525	$ 11,140	$ 7,574

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Revenue Recognition - Impact on Condensed Consolidated Balance Sheets (Details) - USD ($) $ in Thousands	Apr. 28, 2018	Jan. 27, 2018	Apr. 29, 2017
Revenue Recognition
Other current assets	$ 9,234	$ 14,653	$ 5,216
Total current assets	315,112	300,933	274,847
Total assets	1,459,408	1,374,241	1,264,146
Accrued and other current liabilities	92,758	89,499	73,095
Total current liabilities	368,147	343,673	287,979
Total liabilities	838,809	783,362	715,938
Total liabilities and shareholders' equity	$ 1,459,408	1,374,241	1,264,146
As Reported | ASU 2014-09
Revenue Recognition
Other current assets		13,701	4,217
Total current assets		299,981	273,848
Total assets		1,373,289	1,263,147
Accrued and other current liabilities		88,547	72,096
Total current liabilities		342,721	286,980
Total liabilities		782,410	714,939
Total liabilities and shareholders' equity		1,373,289	1,263,147
New Revenue Standard | ASU 2014-09
Revenue Recognition
Other current assets		952	999
Total current assets		952	999
Total assets		952	999
Accrued and other current liabilities		952	999
Total current liabilities		952	999
Total liabilities		952	999
Total liabilities and shareholders' equity		$ 952	$ 999

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Revenue Recognition - Impact on Condensed Consolidated Statement of Cash Flows (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 28, 2018	Apr. 29, 2017
Revenue Recognition
Prepaid expenses and other current assets	$ 4,091	$ (3,088)
Accrued liabilities	(9,117)	(4,711)
Net cash provided by operating activities	$ 6,708	20,850
ASU 2014-09 | As Reported
Revenue Recognition
Prepaid expenses and other current assets		(3,166)
Accrued liabilities		(4,633)
Net cash provided by operating activities		20,850
ASU 2014-09 | New Revenue Standard
Revenue Recognition
Prepaid expenses and other current assets		78
Accrued liabilities		$ (78)

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Revenue Recognition - Disaggregation of revenue (Details) - segment	3 Months Ended
	Apr. 28, 2018	Apr. 29, 2017
Revenue Recognition
Number of reportable segments	1
Revenue percentage	100.00%	100.00%
Home furnishings
Revenue Recognition
Revenue percentage	52.00%	53.00%
Accent decor
Revenue Recognition
Revenue percentage	44.00%	44.00%
Other
Revenue Recognition
Revenue percentage	4.00%	3.00%

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Revenue Recognition - Narratives (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 28, 2018	Apr. 29, 2017	Jan. 27, 2018
Revenue Recognition
Revenue	$ 256,161	$ 211,841
Revenue recognized	1,400	1,500
Gift card liability	$ 5,800	4,028	$ 5,787
Synchrony Bank
Revenue Recognition
Amortization period of capitalized contract costs	7 years
Gift Card Redemption
Revenue Recognition
Revenue	$ 3,600	$ 2,700

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Revenue Recognition - Components of Sales Returns Reserve (Details) - USD ($) $ in Thousands	Apr. 28, 2018	Jan. 27, 2018	Apr. 29, 2017
Contract with Customer, Right of Return [Abstract]
Accrued and other current liabilities	$ 3,332	$ 2,023	$ 2,365
Other current assets	1,429	952	999
Sales returns reserve, net	$ 1,903	$ 1,071	$ 1,366

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Fair Value Measurements (Details) - Level 2 - Fixed rate mortgage $ in Millions	Apr. 28, 2018 USD ($)
Fair Value Measurements
Fair value of fixed rate mortgage	$ 6.1
Carrying value of fixed rate mortgage	$ 6.1

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Sale -Lease Back Transactions (Details) $ in Millions	1 Months Ended
	Feb. 28, 2018 USD ($) property
Sale-Leaseback Transactions
Number of Properties Sold | property	4
Proceeds from sale of properties	$ 50.3
Net gain	22.6
Cumulative initial annual rent	$ 3.4

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Accrued and Other Current Liabilities (Details) - USD ($) $ in Thousands	Apr. 28, 2018	Jan. 27, 2018	Apr. 29, 2017
Accrued Liabilities
Inventory in-transit	$ 10,496	$ 14,618	$ 13,620
Accrued payroll and other employee-related liabilities	5,858	16,917	4,575
Accrued taxes, other than income	15,500	11,680	13,370
Accrued interest	4,418	4,173	327
Insurance liabilities	3,648	3,391	3,470
Gift card liability	5,800	5,787	4,028
Construction costs	19,947	9,661	10,169
Accrued inbound freight	9,132	10,796	9,110
Other	17,959	12,476	14,426
Total accrued liabilities	$ 92,758	$ 89,499	$ 73,095

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Revolving Line of Credit (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 28, 2018	Apr. 29, 2017	Jan. 27, 2018
Line of Credit Facility [Line Items]
Outstanding under the ABL credit agreement	$ 183,500	$ 126,800	$ 162,000
ABL Credit Facility
Line of Credit Facility [Line Items]
Maximum borrowing capacity	$ 350,000
Effective interest rate (as a percent)	3.50%	2.30%
Outstanding under the ABL credit agreement	$ 183,500
Available borrowing capacity	$ 80,900
ABL Credit Facility | Federal Funds Rate
Line of Credit Facility [Line Items]
Basis spread on variable rate	0.50%
ABL Credit Facility | Federal Funds Rate | Minimum
Line of Credit Facility [Line Items]
Applicable margin	0.25%
ABL Credit Facility | Federal Funds Rate | Maximum
Line of Credit Facility [Line Items]
Applicable margin	0.75%
ABL Credit Facility | LIBOR
Line of Credit Facility [Line Items]
Basis spread on variable rate	1.00%
ABL Credit Facility | LIBOR | Minimum
Line of Credit Facility [Line Items]
Applicable margin	0.25%
Applicable margin on bank's LIBOR	1.25%
ABL Credit Facility | LIBOR | Maximum
Line of Credit Facility [Line Items]
Applicable margin	0.75%
Applicable margin on bank's LIBOR	1.75%
ABL Credit Facility | Bank's Prime rate | Minimum
Line of Credit Facility [Line Items]
Applicable margin	0.25%
ABL Credit Facility | Bank's Prime rate | Maximum
Line of Credit Facility [Line Items]
Applicable margin	0.75%
Letters of Credit
Line of Credit Facility [Line Items]
Maximum borrowing capacity	$ 50,000
Outstanding under the ABL credit agreement	600
Swingline loan
Line of Credit Facility [Line Items]
Maximum borrowing capacity	$ 20,000

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Long-Term Debt - Summary (Details) - USD ($)	3 Months Ended
	Apr. 28, 2018	Jan. 27, 2018	Apr. 29, 2017
Long-term Debt, by Current and Noncurrent [Abstract]
Total debt	$ 298,690,000	$ 299,519,000	$ 309,702,000
Less: current maturities	3,319,000	3,316,000	3,521,000
Less: unamortized deferred debt issuance costs	5,974,000	6,301,000	6,778,000
Long-term Debt and Capital Lease Obligations	289,397,000	289,902,000	299,403,000
Term Loan Facility
Long-term Debt, by Current and Noncurrent [Abstract]
Total debt	291,750,000	292,500,000	294,000,000
Note payable, bank
Long-term Debt, by Current and Noncurrent [Abstract]
Total debt	6,073,000	6,108,000	6,002,000
Installment payable	$ 34,483
Interest rate, stated percentage	4.50%
Obligations under capital leases
Long-term Debt, by Current and Noncurrent [Abstract]
Total debt	$ 867,000	$ 911,000	$ 9,700,000

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Long-Term Debt - First Lien and Second Lien Agreement (Details) - Term Loan Facility - First Lien Agreement $ in Millions	Jun. 05, 2015 USD ($)
Long-term Debt, by Current and Noncurrent [Abstract]
Debt instrument, face value	$ 300.0
Installment payable	$ 0.8
Percentage of annual aggregate amount of principal amount	1.00%
Interest rate reduction, related to net leverage ratio	0.50%
LIBOR
Long-term Debt, by Current and Noncurrent [Abstract]
Floor rate	1.00%
Basis spread (as a percent)	4.00%

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Related Party Transactions (Details) - USD ($) $ in Millions	3 Months Ended
	Apr. 28, 2018	Apr. 29, 2017
Related Party Transaction [Line Items]
Ownership percent by sponsors	61.00%
MMI
Related Party Transaction [Line Items]
Payments to related party	$ 0.2	$ 0.2

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Income Taxes - Tax Cuts and Jobs Act (Benefit) (Details)	3 Months Ended	12 Months Ended
	Apr. 28, 2018	Jan. 26, 2019	Jan. 27, 2018
U.S. federal corporate tax rate	21.00%		35.00%
Forecast
U.S. federal corporate tax rate		21.00%

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Income Taxes (Details) - USD ($) $ in Millions	3 Months Ended
	Apr. 28, 2018	Apr. 29, 2017
Income Taxes
Effective income tax rate	0.30%	38.90%
Equity-based compensation	$ 4.2

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Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Apr. 28, 2018	Apr. 29, 2017
Numerator:
Net income	$ 18,361	$ 10,049
Denominator:
Weighted average common shares outstanding-basic	61,758,330	60,366,768
Effect of dilutive securities:
Stock options and restricted stock units	4,130,833	1,898,480
Weighted average common shares outstanding-diluted	65,889,163	62,265,248
Per common share:
Basic net income (loss) per common share (in dollars per share)	$ 0.30	$ 0.17
Diluted net income (loss) per common share (in dollars per share)	$ 0.28	$ 0.16

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Earnings Per Share - Additional Information (Details) - shares	3 Months Ended
	Apr. 28, 2018	Apr. 29, 2017
Stock option
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive shares excluded from calculation of income per common share	205,882	2,743,140

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Stock-Based Compensation (Details) - 2016 Equity Plan - USD ($) $ in Millions		3 Months Ended
	Apr. 03, 2018	Apr. 28, 2018
Stock option
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of units granted	663,247
Stock-based compensation expense		$ 8.5
Stock option | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expense period		3 years
Stock option | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expense period		4 years
RSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of units granted	49,189
Stock-based compensation expense		$ 1.5
RSUs | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expense period		1 year
RSUs | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expense period		3 years

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Subsequent Events (Details) shares in Millions	Jun. 12, 2018 shares
Subsequent event | Stock option
Subsequent Event [Line Items]
Number of units granted	1.5