Share-Based Compensation Plans

The Company’s stock-based compensation plans, as of February 1, 2014, are described below. The Company recognizes compensation expense for share-based payments based on the fair value of the awards as required by the Compensation – Stock Compensation Topic of the Codification.

Stock Incentive Plans

The Company has two fixed stock incentive plans. Under the 2009 Amended and Restated Equity Incentive Plan (the “2009 Plan”), effective as of June 22, 2011, the Company may grant options, restricted shares, performance awards and other stock-based awards to its employees, consultants and directors for up to 2.5 million shares of common stock. Under the 2005 Equity Incentive Plan (the “2005 Plan”), effective as of June 23, 2005, the Company was permitted to grant options, restricted shares and other stock-based awards to its employees and consultants as well as directors for up to 2.5 million shares of common stock. There will be no future awards under the 2005 Equity Incentive Plan. Under both plans, the exercise price of each option equals the market price of the Company’s stock on the date of grant, and an option’s maximum term is 10 years. Options granted under both plans vest 25% per year over four years.

For Fiscal 2014, 2013 and 2012, the Company recognized stock option related share-based compensation of $0.0, $0.0 and less than $1,000, respectively, for its fixed stock incentive plans included in selling and administrative expenses in the accompanying Consolidated Statements of Operations. The Company did not capitalize any share-based compensation cost.

The Compensation—Stock Compensation Topic of the Codification requires that the cash flows resulting from tax benefits for tax deductions in excess of the compensation cost recognized for those options (excess tax benefit) be classified as financing cash flows. Accordingly, the Company classified excess tax benefits of $3.8 million, $4.8 million and $4.7 million as financing cash inflows rather than as operating cash inflows on its Consolidated Statement of Cash Flows for Fiscal 2014, 2013 and 2012, respectively.

The Company did not grant any fixed stock options in Fiscal 2014, 2013 or 2012.

Note 12

Share-Based Compensation Plans, Continued

A summary of fixed stock option activity and changes for Fiscal 2014, 2013 and 2012 is presented below:



	Options		Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term	Aggregate Intrinsic Value (in thousands)⁽¹⁾
Outstanding, January 29, 2011	877,130		$	24.75
Granted	—		—
Exercised	(390,357	)	24.82
Forfeited	—		—
Outstanding, January 28, 2012	486,773		$	24.70
Granted	—		—
Exercised	(223,618	)	21.50
Forfeited	—		—
Outstanding, February 2, 2013	263,155		$	27.43
Granted	—		—
Exercised	(130,051	)	23.33
Forfeited	(2,250	)	17.50
Outstanding, February 1, 2014	130,854		$	31.67	1.58	$	5,045
Exercisable, February 1, 2014	130,854		$	31.67	1.58	$	5,045


(1)	Based upon the difference between the closing market price of the Company’s common stock on the last trading day of the year and the grant price of in-the-money options.

The total intrinsic value, which represents the difference between the underlying stock’s market price and the option’s exercise price, of options exercised during Fiscal 2014, 2013 and 2012 was $6.1 million, $11.5 million and $10.3 million, respectively.

As of February 1, 2014, the Company does not have any nonvested options of its fixed stock incentive plans.

As of February 1, 2014, there was no unrecognized compensation costs related to stock options under the 2009 Plan. Cash received from option exercises under all share-based payment arrangements for Fiscal 2014, 2013 and 2012 was $3.0 million, $4.8 million and $9.7 million, respectively.

Restricted Stock Incentive Plans

Director Restricted Stock

The 2009 Plan permits grants to non-employee directors on such terms as the Company's board of directors may approve. Restricted stock awards were made to independent directors on the date of the annual meeting of shareholders in each of Fiscal 2014, 2013 and 2012. The shares granted in each award vested on the first anniversary of the grant date, subject to the director's continued service through that date. The board of directors also approved a grant of 365 additional shares in Fiscal 2014 and 336 additional shares in Fiscal 2013 to a newly elected director each year on the annual meeting date in

Note 12

Share-Based Compensation Plans, Continued

Fiscal 2014 and 2013 on the same terms as the Fiscal 2014 and 2013 grant to all outside directors. In all cases, the director is restricted from selling, transferring, pledging or assigning the shares for three years from the grant date unless he or she earlier leaves the board.

The Fiscal 2012 grants were valued at $70,000 for each director and Fiscal 2013 and 2014 grants were each valued at $80,000 per director based on the average closing price of the stock for the first five trading days of the month in which they were granted and vested on the first anniversary of the grant date. For Fiscal 2014, 2013 and 2012, the Company issued 9,280 shares, 9,888 shares and 14,643 shares, respectively, of director restricted stock.

For Fiscal 2014, 2013 and 2012, the Company recognized $1.0 million, $0.9 million and $0.8 million, respectively, of director restricted stock related share-based compensation in selling and administrative expenses in the accompanying Consolidated Statements of Operations.

Employee Restricted Stock

Under the 2009 Plan, the Company issued 199,392 shares, 194,232 shares and 289,407 shares of employee restricted stock in Fiscal 2014, 2013 and 2012, respectively. Shares of employee restricted stock issued in Fiscal 2012, 2013 and 2014 vest 25% per year over four years, provided that on such date the grantee has remained continuously employed by the Company since the date of grant. The fair value of employee restricted stock is charged against income as compensation cost over the vesting period. Compensation cost recognized in selling and administrative expenses in the accompanying Consolidated Statements of Operations for these shares was $11.3 million, $9.6 million and $6.9 million for Fiscal 2014, 2013 and 2012, respectively.

Note 12

Share-Based Compensation Plans, Continued

A summary of the status of the Company’s nonvested shares of its employee restricted stock as of February 1, 2014 is presented below:



Nonvested Restricted Shares	Shares		Weighted-Average Grant-Date Fair Value
Nonvested at January 29, 2011	818,119		$	23.95
Granted	289,407		45.14
Vested	(227,691	)	22.58
Withheld for federal taxes	(93,089	)	22.42
Forfeited	(14,081	)	27.38
Nonvested at January 28, 2012	772,665		32.41
Granted	194,232		57.58
Vested	(195,203	)	29.95
Withheld for federal taxes	(75,552	)	29.97
Forfeited	(3,360	)	38.96
Nonvested at February 2, 2013	692,782		40.59
Granted	199,392		65.11
Vested	(199,428	)	34.31
Withheld for federal taxes	(105,193	)	34.42
Forfeited	(6,279	)	46.48
Nonvested at February 1, 2014	581,274		$	52.21

As of February 1, 2014, there was $23.1 million of total unrecognized compensation costs related to nonvested share-based compensation arrangements for restricted stock discussed above. That cost is expected to be recognized over a weighted average period of 1.25 years.

Employee Stock Purchase Plan

Under the Employee Stock Purchase Plan, the Company is authorized to issue up to 1.0 million shares of common stock to qualifying full-time employees whose total annual base salary is less than $90,000, effective October 1, 2002. Prior to October 1, 2002, the total annual base salary was limited to $100,000. Under the terms of the Plan, employees could choose each year to have up to 15% of their annual base earnings or $8,500, whichever is lower, withheld to purchase the Company’s common stock. The purchase price of the stock was 85% of the closing market price of the stock on either the exercise date or the grant date, whichever was less. The Company’s board of directors amended the Company’s Employee Stock Purchase Plan effective October 1, 2005 to provide that participants may acquire shares under the Plan at a 5% discount from fair market value on the last day of the Plan year. Employees can choose each year to have up to 15% of their annual base earnings or $9,500, whichever is lower, withheld to purchase the Company’s common stock. Under the Compensation – Stock Compensation Topic of the Codification, shares issued under the Plan as amended are non-compensatory. Under the Plan, the Company sold 3,146 shares, 2,463 shares and 2,717 shares to employees in Fiscal 2014, 2013 and 2012, respectively.