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Stock-Based Compensation
 12 Months Ended
Apr. 24, 2021
Share-based Payment Arrangement [Abstract]  
Stock-Based Compensation Stock-Based Compensation
In fiscal 2018, our shareholders approved the La-Z-Boy Incorporated 2017 Omnibus Incentive Plan which provides for the grant of stock options, stock appreciation rights, restricted stock, stock units (including deferred stock units), unrestricted stock, dividend equivalent rights, and short-term cash incentive awards. Under this plan, as amended, the aggregate number of common shares that may be issued through awards of any form is 5.9 million shares.

The table below summarizes the total stock-based compensation expense recognized for all outstanding grants in our consolidated statement of income:
Fiscal Year Ended
(52 weeks)(52 weeks)(52 weeks)
(Amounts in thousands)4/24/20214/25/20204/27/2019
Equity-based awards expense
Stock options $2,959 $2,000 $3,507 
Restricted stock awards3,367 2,913 2,548 
Restricted stock units issued to Directors840 900 704 
Performance-based shares5,505 2,558 4,222 
Total equity-based awards expense12,671 8,371 10,981 
Liability-based awards expense
Stock appreciation rights375 (240)98 
Restricted stock units 43 20 22 
Performance-based units23 6 7 
Deferred stock units1,437 (768)212 
Total liability-based awards expense1,878 (982)339 
Total stock-based compensation expense (1)
$14,549 $7,389 $11,320 
(1)Stock-based compensation expense is recorded in SG&A expense in the consolidated statement of income.
Stock Options. The La-Z-Boy Incorporated 2017 Omnibus Incentive Plan authorized grants to certain employees and directors to purchase common shares at a specified price, which may not be less than 100% of the current market price of the stock at the date of grant. We granted 315,584 stock options to employees during the first quarter of fiscal 2021, and we also have stock options outstanding from previous grants. We recognize compensation expense for stock options over the vesting period equal to the fair value on the date our Compensation Committee approved the awards. The vesting period for our stock options ranges from one to four years, with accelerated vesting upon retirement. The vesting date for retirement-eligible employees is the later of the date they meet the criteria for retirement or the end of the fiscal year in which the grant was made. We accelerate the expense for options granted to retirement eligible employees over the vesting period, with expense recognized from the grant date through their retirement eligibility date or over the ten months following the grant date, whichever period is longer. We have elected to recognize forfeitures as an adjustment to compensation expense in the same period as the forfeitures occur. Granted options outstanding under the former long-term equity award plan remain in effect and have a term of 10 years.
We received $10.8 million, $4.8 million, and $16.2 million in cash during fiscal 2021, 2020, and 2019, respectively, for exercises of stock options.
Plan activity for stock options under the above plans was as follows:
Number of Shares
(In Thousands)
Weighted Average Exercise Price
Weighted Average Remaining Contractual Term
 (Years)
Aggregate Intrinsic Value
(In Thousands)
Outstanding at April 25, 20201,438 $28.76 7.2$103 
Granted316 27.54 N/AN/A
Canceled(7)31.34 N/AN/A
Exercised(405)26.79 N/A5,102 
Outstanding at April 24, 20211,342 29.05 7.219,008 
Exercisable at April 24, 2021592 $28.67 6.0$8,609 
The aggregate intrinsic value of options exercised was $1.7 million and $9.9 million in fiscal 2020 and fiscal 2019, respectively. As of April 24, 2021, our total unrecognized compensation cost related to non-vested stock option awards was $1.6 million, which we expect to recognize over a weighted-average remaining vesting term of all unvested awards of 1.7 years. During the year ended April 24, 2021, stock options with respect to 0.4 million shares vested.
We estimate the fair value of the employee stock options at the date of grant using the Black-Scholes option-pricing model, which requires management to make certain assumptions. We estimate expected volatility based on the historical volatility of our common shares. We base the average expected life on the contractual term of the stock option and expected employee exercise trends. We base the risk-free rate on U.S. Treasury issues with a term equal to the expected life assumed at the date of the grant. The fair value of stock options granted during fiscal 2021, fiscal 2020, and fiscal 2019 were calculated using the following assumptions:
Fiscal 2021 grantFiscal 2020 grantFiscal 2019 grant
Risk-free interest rate0.34 %2.19 %2.82 %
Dividend rate— %1.72 %1.45 %
Expected life in years5.05.05.0
Stock price volatility41.79 %34.27 %33.07 %
Fair value per share$10.06 $7.94 $9.65 
Stock Appreciation Rights ("SARs"). We have not granted any SARs to employees since fiscal 2014, but we have SARs outstanding from the fiscal 2014 award. All outstanding SARs are fully vested and have a term of ten years. SARs will be paid in cash upon exercise and, accordingly, we account for SARs as liability-based awards that we remeasure to fair value at the end of each reporting period. We have no remaining unrecognized compensation cost at April 24, 2021, relating to SARs awards as they are all fully vested, but we will continue to remeasure these awards to reflect the fair value at the end of each reporting period until all awards are exercised or forfeited. As of April 24, 2021, we had 6,010 SARs outstanding for the fiscal 2014 award. These awards have exceeded their expected life and are remeasured to fair value based on their intrinsic value, which is the market value of our common stock on the last day of the reporting period less the exercise price, until the earlier of
the exercise date or the contractual term date. At April 24, 2021, the intrinsic value per share of the fiscal 2014 award was $24.16.

Restricted Stock. We awarded 137,885 shares of restricted stock to employees during fiscal 2021. We issue restricted stock at no cost to the employees, and the shares are held in an escrow account until the vesting period ends. If a recipient's employment ends during the escrow period (other than through death or disability), the shares are returned at no cost to the Company. We account for restricted stock awards as equity-based awards because when they vest, they will be settled in common shares. The weighted average fair value of the restricted stock that was awarded in fiscal 2021 was $29.35 per share, the market value of our common shares on the date of grant. We have elected to recognize forfeitures as an adjustment to compensation expense in the same period as the forfeitures occur. We recognize compensation expense for restricted stock over the vesting period equal to the fair value on the date our compensation committee approved the awards. Restricted stock awards vest at 25% per year, beginning one year from the grant date for a term of four years.
The following table summarizes information about non-vested share awards as of and for the year ended April 24, 2021:
 
Shares
(In Thousands)
Weighted Average Grant Date Fair Value
Non-vested shares at April 25, 2020293 $30.34 
Granted138 29.35 
Vested(102)29.66 
Canceled(9)30.20 
Non-vested shares at April 24, 2021320 30.14 
Unrecognized compensation cost related to non-vested restricted shares was $6.9 million and is expected to be recognized over a weighted-average remaining contractual term of all unvested awards of 1.7 years.
Restricted Stock Units. Restricted stock units granted to our non-employee directors are offered at no cost to the directors and vest when a director leaves the board. During fiscal 2021, fiscal 2020, and fiscal 2019 we granted less than 0.1 million restricted stock units each year to our non-employee directors. We account for these restricted stock units as equity-based awards because when they vest, they will be settled in shares of our common stock. We measure and recognize compensation expense for these awards based on the market price of our common shares on the date of grant, which was $32.08, $31.77, and $33.15 for the awards granted in fiscal 2021, fiscal 2020, and fiscal 2019, respectively.
Performance Awards. Under the La-Z-Boy Incorporated 2017 Omnibus Incentive Plan, the Compensation Committee of the board of directors is authorized to award common shares to certain employees based on the attainment of certain financial goals over a given performance period. The awards are offered at no cost to the employees. In the event of an employee's termination during the vesting period, the potential right to earn shares under this program is generally forfeited.
Payout of the fiscal 2021 grant depends on our financial performance (50%) and a market-based condition based on the total return our shareholders receive on their investment in our stock relative to returns earned through investments in other public companies (50%). The performance award opportunity ranges from 50% of the employee's target award if minimum performance requirements are met to a maximum of 200% of the target award based on the attainment of certain financial and shareholder-return goals over a specific performance period, which is generally three fiscal years. Grants of performance-based shares during fiscal 2019 and fiscal 2020 were weighted (80%) on financial performance and (20%) on market-based conditions consistent with those in the fiscal 2021 grant
The number of awards that will vest, as well as unearned and canceled awards, depend on the achievement of certain financial and shareholder-return goals over the three-year performance periods, and will be settled in shares if service conditions are met, requiring employees to remain employed with the Company through the end of the three-year performance periods.
The following table summarizes the performance-based shares outstanding at the maximum award amounts based upon the respective performance share agreements:
 
Shares
(In Thousands)
Weighted Average Grant Date Fair Value
Outstanding shares at April 25, 2020534 $29.21 
Granted337 30.75 
Vested(98)25.93 
Unearned or canceled(104)30.30 
Outstanding shares at April 24, 2021669 30.32 
We account for performance-based shares as equity-based awards because when they vest, they will be settled in common shares. We have elected to recognize forfeitures as an adjustment to compensation expense in the same period as the forfeitures occur. For shares that vest based on our results relative to the performance goals, we expense as compensation cost the fair value of the shares as of the day we granted the awards recognized over the performance period, taking into account the probability that we will satisfy the performance goals. The fair value of each share of the awards we granted in fiscal 2021, fiscal 2020, and fiscal 2019 that vest based on attaining performance goals was $30.75, $28.68, and $31.71, respectively, the market value of our common shares on the date we granted the awards less the dividends we expect to pay before the shares vest. For shares that vest based on market conditions, we use a Monte Carlo valuation model to estimate each share's fair value as of the date of grant. The Monte Carlo valuation model uses multiple simulations to evaluate our probability of achieving various stock price levels to determine our expected performance ranking relative to our peer group. Similar to the way in which we expense the awards of stock options, we expense compensation cost over the vesting period regardless of whether the market condition is ultimately satisfied. Based on the Monte Carlo model, the fair value as of the grant date of the fiscal 2021, fiscal 2020, and fiscal 2019 grants of shares that vest based on market conditions was $38.14, $38.75, and $46.39, respectively. Our unrecognized compensation cost at April 24, 2021, related to performance-based shares was $6.8 million based on the current estimates of the number of awards that will vest, and is expected to be recognized over a weighted-average remaining contractual term of all unvested awards of 1.4 years.
Equity-based compensation expenses related to performance-based shares recognized in our consolidated statement of income were as follows (for the fiscal years ended):
Fiscal Year Ended
(52 weeks)(52 weeks)(52 weeks)
(Amounts in thousands)4/24/20214/25/20204/27/2019
Fiscal 2017 grant$— $— $1,044 
Fiscal 2018 grant— 611 1,402 
Fiscal 2019 grant1,545 996 1,776 
Fiscal 2020 grant2,051 951 — 
Fiscal 2021 grant1,909 — — 
Total expense$5,505 $2,558 $4,222 
Deferred Stock Units. We account for awards under our deferred stock unit plan for non-employee directors as liability-based awards because upon exercise these awards will be paid in cash. We measure and recognize compensation expense based on the market price of our common stock on the grant date. We remeasure and adjust the liability based on the market value (intrinsic value) of our common shares on the last day of the reporting period until paid with a corresponding adjustment to reflect the cumulative amount of compensation expense. For purposes of dividends and for measuring the liability, each deferred stock unit is the equivalent of one common share. As of April 24, 2021, we had 0.1 million deferred stock units outstanding. Our liability related to these awards was $2.7 million and $1.4 million at April 24, 2021, and April 25, 2020, respectively, and is included as a component of other long-term liabilities on our consolidated balance sheet.