Share-Based Plans

6 Months Ended

Jul. 31, 2021

Share-based Payment Arrangement [Abstract]

We have issued restricted stock units, PSUs, PRSUs, and nonqualified stock options under our shareholder-approved equity compensation plans. At July 31, 2021, we had no outstanding PRSUs and no outstanding nonqualified stock options. We recognized share-based compensation expense of $11.0 million and $4.5 million in the second quarter of 2021 and the second quarter of 2020, respectively, and $22.9 million and $7.4 million for the year-to-date 2021 and the year-to-date 2020, respectively.

Non-vested Restricted Stock Units

The following table summarizes the non-vested restricted stock units activity for the year-to-date 2021:


	Number of Shares	Weighted Average Grant-Date Fair Value Per Share
Outstanding non-vested restricted stock units at January 30, 2021	1,214,212	$	22.71
Granted	206,685	70.77
Vested	(390,116)	22.74
Forfeited	(31,181)	25.26
Outstanding non-vested restricted stock units at May 1, 2021	999,600	$	32.56
Granted	34,847	64.55
Vested	(37,454)	32.85
Forfeited	(12,851)	25.39
Outstanding non-vested restricted stock units at July 31, 2021	984,142	$	33.77

The non-vested restricted stock units granted in the year-to-date 2021 generally vest and are expensed on a ratable basis over three years from the grant date of the award, if a threshold financial performance objective is achieved and the grantee remains employed by us through the vesting dates.

Non-vested Restricted Stock Units Granted to Non-Employee Directors

In the second quarter of 2021, 22,850 common shares underlying the restricted stock units granted in 2020 to the non-employee members of our Board vested on the trading day immediately preceding our 2021 Annual Meeting of Shareholders (“2021 Annual Meeting”). These units were part of the annual compensation of the non-employee directors of the Board. Additionally, in the second quarter of 2021, the chairman of our Board received an annual restricted stock unit grant having a grant date fair value of approximately $245,000. The remaining non-employees elected to our Board at our 2021 Annual Meeting each received an annual restricted stock unit grant having a grant date fair value of approximately $145,000. The 2021 restricted stock units will vest on the earlier of (1) the trading day immediately preceding our 2022 Annual Meeting of Shareholders, or (2) the non-employee director’s death or disability. However, the non-employee directors will forfeit their restricted stock units if their service on the Board terminates before either vesting event occurs.

Performance Share Units

In the year-to-date 2020, we awarded PRSUs to certain members of senior management, which were subject to vesting based on the achievement of share price performance goals and a minimum service requirement of one year. The PRSUs had a contractual term of three years. Shares issued in connection with vested PRSUs are generally restricted from sale, transfer, or other disposition prior to the third anniversary of the grant date except under certain circumstances, including death, disability, or change in control. All of the PRSUs awarded in 2020 vested in the year-to-date 2021.

Prior to 2020, and in the year-to-date 2021, we issued PSUs to certain members of management, which will vest if certain financial performance objectives are achieved over a three-year performance period and the grantee remains employed by us during the performance period. The financial performance objectives for each fiscal year within the three-year performance period will be approved by the Compensation Committee of our Board of Directors during the first quarter of the respective fiscal year.

As a result of the process used to establish the financial performance objectives, we will only meet the requirements for establishing a grant date for PSUs when we communicate the financial performance objectives for the third fiscal year of the

award to the award recipients, which will then trigger the service inception date, the fair value of the awards, and the associated expense recognition period. If we meet the applicable threshold financial performance objectives over the three-year performance period and the grantee remains employed by us through the end of the performance period, the PSUs will vest on the first trading day after we file our Annual Report on Form 10-K for the last fiscal year in the performance period.

We have begun or expect to begin recognizing expense related to PSUs as follows:

Issue Year

Outstanding PSUs at July 31, 2021

Actual Grant Date

Expected Valuation (Grant) Date

Actual or Expected Expense Period

2019

254,860

March 2021

Fiscal 2021

2021

174,576

March 2023

Fiscal 2023

Total

429,436

The number of shares to be distributed upon vesting of the PSUs depends on the average performance attained during the three-year performance period compared to the performance targets established by the Compensation Committee, and may result in the distribution of an amount of shares that is greater or less than the number of PSUs granted, as defined in the award agreement. During the first quarter of 2021, the PSUs issued in 2018 vested with an average performance attainment higher than the targets established.

We recognized $7.2 million and $1.2 million in the second quarter of 2021 and 2020, respectively, and $15.8 million and $1.6 million in the year-to-date 2021 and 2020 respectively, of share-based compensation expense related to PSUs and PRSUs.

The following table summarizes the activity related to PSUs and PRSUs for the year-to-date 2021:


	Number of Units	Weighted Average Grant-Date Fair Value Per Share
Outstanding PSUs and PRSUs at January 30, 2021	474,031	$	24.31
Granted	263,787	70.24
Vested	(470,808)	24.27
Forfeited	(8,300)	70.24
Outstanding PSUs and PRSUs at May 1, 2021	258,710	$	69.74
Granted	—	—
Vested	(3,223)	29.93
Forfeited	(627)	70.24
Outstanding PSUs and PRSUs at July 31, 2021	254,860	$	70.24

The following activity occurred under our share-based plans during the respective periods shown:


	Second Quarter				Year-to-Date
(In thousands)	2021		2020		2021		2020
Total intrinsic value of stock options exercised	$	—	$	12	$	—	$	12
Total fair value of restricted stock vested	2,417		849		29,318		4,890
Total fair value of performance shares vested	$	219	$	—	$	37,387	$	924

The total unearned compensation cost related to all share-based awards outstanding, excluding PSUs issued in 2021, at July 31, 2021 was approximately $37.0 million. This compensation cost is expected to be recognized through July 2024 based on existing vesting terms with the weighted-average remaining expense recognition period being approximately 1.6 years from July 31, 2021.