EQUITY-BASED COMPENSATION

12 Months Ended

Feb. 27, 2021

Share-based Payment Arrangement [Abstract]

EQUITY-BASED COMPENSATION The Company maintains the Albertsons Companies, Inc. Restricted Stock Unit Plan (the "Restricted Stock Unit Plan"), which was previously named the "Albertsons Companies, Inc. Phantom Unit Plan" (the "Phantom Unit Plan"). Under the Restricted Stock Unit Plan, subsequent to the IPO, 43.6 million shares of Class A common stock have been authorized for issuance as equity awards to employees and directors. As of February 27, 2021, 42.3 million shares of Class A common stock remained available for future awards. Prior to being amended and

restated on June 9, 2020, the Phantom Unit Plan provided for grants of "Phantom Units" to certain employees, directors and consultants. Each Phantom Unit provided a participant with a contractual right to receive, upon vesting, one management incentive unit in each of the Company's parents, Albertsons Investor Holdings LLC ("Albertsons Investor") and KIM ACI, LLC ("KIM ACI"). Upon the amendment and restatement of the Phantom Unit Plan as the Restricted Stock Unit Plan, all outstanding Phantom Units were converted into 11.3 million RSUs, including 1.9 million performance-based RSUs that were not deemed granted for accounting purposes, under the Restricted Stock Unit Plan, subject to substantially identical terms and conditions as applied prior to the conversion. No changes to vesting conditions or the fair value of the award occurred as a result of the conversion.

On April 25, 2019, upon the commencement of employment, the Company's President and Chief Executive Officer was granted direct equity interests in each of the Company's parents, Albertsons Investor and KIM ACI. On June 30, 2020, upon consummation of the Company's IPO, the unvested direct equity interests in each of the Company's parents converted into 1.7 million RSAs, including 0.6 million performance-based RSAs that are not deemed granted for accounting purposes. No changes to vesting conditions or the fair value of the award occurred as a result of the conversion.

Upon vesting, RSUs and RSAs will be settled in shares of the Company's Class A common stock. RSUs generally vest over three years from the grant date, based on a service period, or upon a combination of both a service period and achievement of certain performance-based thresholds, and RSAs generally vest over five years from the grant date, with 50% based solely on a service period and 50% upon a service period and achievement of certain performance-based thresholds. For performance-based RSUs and RSAs granted in fiscal 2020, the number of shares of the Company's Class A common stock to be received at vesting can be adjusted within a predetermined range based on the Company's actual performance for fiscal 2020 relative to the fiscal 2020 performance target.

Equity-based compensation expense recognized in the Consolidated Statements of Operations (in millions):


	Fiscal 2020		Fiscal 2019		Fiscal 2018
RSUs	$	53.5	$	28.9	$	47.7
RSAs	5.5		3.9		—
Total equity-based compensation expense	$	59.0	$	32.8	$	47.7
Total related tax benefit	$	13.7	$	7.5	$	12.9

During fiscal 2020, the Company issued 5.6 million RSUs to its employees and directors, of which 4.7 million shares were deemed granted. The 4.7 million issued and granted awards consist of 4.3 million RSUs that have solely time-based vesting and 0.4 million performance-based RSUs that were deemed granted upon the establishment of the fiscal 2020 performance target and that would vest upon both the achievement of such performance target and continued service through the vesting period. Additionally, 1.3 million previously issued performance-based RSUs and RSAs were deemed granted in fiscal 2020 upon the establishment of the fiscal 2020 annual performance target and that would vest upon both the achievement of such performance target and continued service through the vesting period. The 6.0 million RSUs and RSAs deemed granted in fiscal 2020 have an aggregate grant date value of $94.5 million.

Summary of RSU and RSA activity during fiscal 2020:


	Time-Based			Performance-Based
	Number of shares (in millions)	Weighted average grant date fair value		Number of shares (in millions)	Weighted average grant date fair value
Unvested, February 29, 2020	5.2	$	8.45	0.9	$	8.93

Granted	4.3	15.51		1.7	16.45
Vested	(3.2)	11.04		(0.3)	10.46
Forfeited or cancelled	(0.3)	11.81		(0.1)	12.20
Unvested, February 27, 2021	6.0	$	11.95	2.2	$	14.39

The aggregate fair value of RSUs and RSAs that vested was $54.3 million, $29.3 million and $32.1 million in fiscal 2020, fiscal 2019 and fiscal 2018, respectively. The grant date fair value of awards that vested was $38.1 million, $23.1 million and $42.1 million in fiscal 2020, fiscal 2019 and fiscal 2018, respectively. The number of RSUs and RSAs vested includes shares of common stock that the Company withheld on behalf of employees to satisfy statutory tax withholding requirements.

As of February 27, 2021, the Company had $81.3 million of unrecognized compensation cost related to 7.1 million unvested granted RSUs. That cost is expected to be recognized over a weighted average period of 1.8 years. As of February 27, 2021, the Company had $5.7 million of unrecognized costs related to 1.1 million unvested granted RSAs. That cost is expected to be recognized over a weighted average period of 3.2 years.

Upon the establishment of the annual performance target for fiscal 2021, fiscal 2022, and fiscal 2023, the remaining 1.9 million issued performance-based RSUs and 0.6 million performance-based RSAs will be deemed granted for accounting purposes, as applicable.