Stock incentive plans: During fiscal 2021, we established the Daktronics, Inc. 2020 Stock Incentive Plan (“2020 Plan”) and ceased granting options under the 2015 Stock Incentive Plan (“2015 Plan”). The 2020 Plan provides for the issuance of stock-based awards, including stock options, restricted stock, restricted stock units, and deferred stock to employees, directors, and consultants. Stock options issued to employees under the 2015 Plan and 2020 Plan generally have a 10-year life, an exercise price equal to the closing market value on the grant date, and a five-year annual vesting period. The restricted stock granted to independent directors vests in one year, provided that the directors remain on the Company’s Board of Directors (the “Board” or “Board of Directors”). Restricted stock units are granted to employees and have a five-year annual vesting period. As with stock options, restricted stock and restricted stock unit ownership cannot be transferred during the vesting period.

As of April 26, 2025, the aggregate number of shares available for future grants under the 2020 Plan for stock options and restricted stock awards was 1,381 shares. Shares of common stock subject to all stock awards granted under the 2020 Plan are counted as one share of stock for each share of stock subject to the award. Although the 2015 Plan remains in effect for options outstanding that were granted under the 2015 Plan until the earlier of the exercise of the options or their expiration or termination without being exercised, no new options can be granted under the 2015 Plan.

Restricted stock and restricted stock units: We issue restricted stock to our non-employee directors and restricted stock units (“RSU”) to employees. Restricted stock issued to non-employee directors are participating securities and receive dividends prior to vesting. Unvested restricted stock will terminate and be forfeited upon termination of employment or service. The fair value of restricted stock and our restricted stock unit awards are measured on the grant date based on the market value of our common stock. The related compensation expense as calculated under ASC 718, net of estimated forfeitures, is recognized over the applicable vesting period. Unrecognized compensation expense related to the restricted stock and restricted stock unit awards was approximately $4,456 as of April 26, 2025, which is expected to be recognized over a weighted-average period of 4.33 years. The total fair value of restricted stock vested was $1,209, $1,536, and $1,160 in fiscal years 2025, 2024, and 2023, respectively.

In March 2025, Reece A. Kurtenbach resigned from his position as President and Chief Executive Officer (“CEO”) of the Company and, as a result, a portion of his unvested RSUs was accelerated and vested, which resulted in additional compensation expense relating to the modified awards for the year ended April 26, 2025. Any remaining unvested RSUs were forfeited. As of April 26, 2025, no unrecognized stock-based compensation expense remained on these RSUs. In addition, a portion of unvested options held by Mr. Kurtenbach was accelerated and vested, which resulted in additional compensation expense relating to the modified awards for the year ended April 26, 2025. Any remaining unvested options were forfeited. The Company offered Mr. Kurtenbach an option to settle his outstanding stock options in cash rather than exercising them. The Company modified these awards and changed the classification of the grant from equity to a liability. Mr. Kurtenbach elected to cash settle his options, and as a result, the Company realized $680 as a liability. As a result, the options were cancelled, and Mr. Kurtenbach received a cash payment and the share based liability was resolved as of April 26, 2025.

In March 2025, the Company recorded a one-time equity award to each of its interim CEO and acting Chief Financial Officer (“CFO”). Pursuant to the terms of the applicable award agreements for the Interim CEO and Acting CFO, 100 percent of the awarded RSUs will become fully vested on the date that the Board appoints a permanent CEO or CFO, as applicable, so long as the applicable executive remains continuously employed by the Company or a subsidiary of the Company until immediately prior to such appointment.


	Year Ended
	April 26, 2025			April 27, 2024			April 29, 2023
	Number of Nonvested Shares	Weighted Average Grant Date Fair Value Per Share		Number of Nonvested Shares	Weighted Average Grant Date Fair Value Per Share		Number of Nonvested Shares	Weighted Average Grant Date Fair Value Per Share
Outstanding at beginning of year	486	$	5.95	617	$	4.11	469	$	5.65
Granted	318	13.19		159	9.85		360	3.15
Vested	(189)	6.45		(280)	3.92		(192)	5.98
Forfeited	(15)	6.71		(10)	4.77		(20)	4.98
Outstanding at end of year	600	$	9.62	486	$	5.95	617	$	4.11


	Stock Options	Weighted Average Exercise Price Per Share		Weighted Average Remaining Contractual Life (Years)	Aggregate Intrinsic Value
Outstanding as of April 27, 2024	1,635	$	6.89	5.06	$	4,607
Granted	29	11.87		—	—
Cancelled or forfeited	(165)	—		—	—
Exercised	(598)	8.66		—	3,594
Outstanding as of April 26, 2025	901	$	5.78	5.41	$	6,107

Shares vested and expected to vest	890	$	5.78	5.38	$	6,031
Exercisable as of April 26, 2025	530	$	6.46	4.29	$	3,233

The aggregate intrinsic value of stock options represents the difference between the exercise price of stock options and the fair market value of the underlying common stock for all in-the-money options. We define in-the-money options as of April 26, 2025 as options having exercise prices lower than the $12.56 per share market price of our common stock on that date. There were 530 shares exercisable that were in-the-money options as of April 26, 2025. The total intrinsic value of options exercised during fiscal years 2025, 2024, and 2023 was $3,594, $708, and $7, respectively. The total fair value of stock options vested was $410, $453, and $467 for fiscal years 2025, 2024, and 2023, respectively.

We estimate the fair value of stock options granted using the Black-Scholes option valuation model. We recognize the fair value of the stock options on a straight-line basis as compensation expense. All options are recognized over the requisite service periods of the awards, which are generally the vesting periods.

The Black-Scholes option-pricing model was developed for use in estimating the fair value of traded options which have no vesting restrictions and are fully transferable. In addition, option valuation models require the input of highly subjective assumptions, including the expected stock price volatility. ASC 718 requires us to estimate forfeitures at the time of grant and to revise those estimates in subsequent periods if actual forfeitures differ from those estimates. We use historical data to estimate pre-vesting option forfeitures and record share-based compensation expense only for those awards expected to vest. The following factors are the significant assumptions used in the computation of the fair value of options:

Expected life. The expected life of options granted represents the period of time they are expected to be outstanding. We estimate the expected life of options granted based on historical exercise patterns, which we believe are representative of future behavior. We have examined our historical pattern of option exercises in an effort to determine if there were any discernible patterns of activity based on certain demographic characteristics. Demographic characteristics tested included age, salary level, job level, and geographic location. We have determined there were no meaningful differences in option exercise activity based on the demographic characteristics tested.


	Year Ended
	April 26, 2025			April 27, 2024			April 29, 2023
Fair value of options granted	$	5.98		$	4.92		$	1.34
Risk-free interest rate	3.58		%	4.37		%	3.37		%

Expected volatility	49.14		%	46.28		%	41.10		%
Expected life of option (in years)	6.83			6.90			6.93

Employee stock purchase plan: We have an employee stock purchase plan (“ESPP”), which enables employees after six months of continuous employment to elect, in advance and semi-annually, to contribute up to 15 percent of their compensation, subject to certain limitations, toward the purchase of our common stock at a purchase price equal to 85 percent of the lower of the fair market value of the common stock on the first or last day of the participation period. The ESPP requires participants to hold any shares purchased under the ESPP for a minimum period of one year after the date of purchase. Compensation expense recognized on shares issued under our ESPP is based on the value of a traded option to purchase shares of our stock at a 15 percent discount to the stock price. The total number of shares reserved under the ESPP is 5,500. The number of shares of common stock issued under the ESPP totaled 148, 355, and 424 shares in fiscal 2025, 2024, and 2023, respectively. The number of shares of common stock reserved for future employee purchases under the ESPP totaled 1,071 shares as of April 26, 2025. The ESPP is intended to qualify under Section 423 of the Internal Revenue Code of 1986.

Total share-based compensation expense: As of April 26, 2025, there was $4,981 of total unrecognized compensation cost related to non-vested share-based compensation arrangements granted under all equity compensation plans. Total unrecognized compensation cost will be adjusted for future changes in estimated forfeitures. We expect to recognize the cost over a weighted-average period of 4.33 years.

A summary of the share-based compensation expense by classification in the Consolidated Statements of Operations for stock options, restricted stock, restricted stock units, and shares issued under the ESPP for fiscal years 2025, 2024, and 2023 is as follows:

We received $5,153 in cash from option exercises under all share-based payment arrangements for the fiscal year ended April 26, 2025. The tax expense related to non-qualified options and restricted stock units under all share-based payment arrangements totaled $5, $22, and $23 for fiscal years 2025, 2024, and 2023, respectively.