|12 Months Ended|
Feb. 02, 2019
11. SHARE-BASED COMPENSATION
The Michaels Companies, Inc. Second Amended and Restated 2014 Omnibus Long-Term Incentive Plan provides for the grant of share-based awards for up to 28.6 million shares of common stock. As of February 2, 2019, there were 7.5 million shares of common stock remaining available for grant. Generally, time-based share awards vest ratably over four or five years and stock options expire eight to ten years from the grant date. Restricted awards that are performance-based are expected to vest between one to four years from the grant date. As of February 2, 2019, unrecognized compensation cost for all unvested share-based awards totaled $68.2 million and is expected to be recognized over a weighted-average period of 2.5 years. Share-based compensation expense totaled $27.1 million in fiscal 2018, $24.3 million in fiscal 2017 and $16.5 million in fiscal 2016 and is recorded in cost of sales and occupancy expense and SG&A in the consolidated statements of comprehensive income.
The fair value of each stock option is estimated using the Black-Scholes option pricing model. The following table presents the weighted-average assumptions used during fiscal years 2018, 2017 and 2016:
The stock option activity during the fiscal year ended February 2, 2019 was as follows:
The total grant date fair value of options that vested during fiscal 2018, fiscal 2017 and fiscal 2016 was $9.5 million, $8.3 million and $7.4 million, respectively. The intrinsic value for options that vested during fiscal 2018, fiscal 2017 and fiscal 2016 was $4.1 million, $5.4 million and $13.1 million, respectively. The intrinsic value for options exercised during fiscal 2018, fiscal 2017 and fiscal 2016 was $2.6 million, $15.7 million and $30.8 million, respectively. As of the beginning of fiscal 2018, there were 4.5 million nonvested options with a weighted-average fair value of $5.77 per share. As of the end of fiscal 2018, there were 4.0 million nonvested options with a weighted-average fair value of $5.93 per share. The weighted-average fair value of options granted during fiscal 2018, fiscal 2017 and fiscal 2016 was $5.85, $5.88 and $6.27, respectively. During fiscal 2018, there were 1.8 million options that vested and 1.2 million options that were cancelled with a weighted-average fair value of $5.40 and $5.97 per share, respectively.
The Company issues restricted shares to certain key employees and its Board of Directors. Restricted share units awarded to employees that are time-based vest ratably over four or five years. Restricted share units that are performance-based vest based on predetermined financial and operational targets and are expected to vest between one to four years from the grant date. Restricted shares awarded to Board of Director members vest ratably over one year. Compensation expense for all time-based restricted stock awards and restricted stock units is based on the amortization of the fair market value at the date of grant over the vesting period. Compensation expense for performance-based restricted share units is based on the estimated timing of the achievement of predetermined financial and operational targets.
Restricted stock unit activity during the fiscal year ended February 2, 2019 was as follows:
Restricted stock award activity during the fiscal year ended February 2, 2019 was as follows:
The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef