The Company grants stock-based awards under its Stock Incentive Plan (the “Plan”). Awards that may be granted under the Plan include, but are not limited to (i) service-based restricted stock units (“RSUs”); (ii) contingently issuable performance share units (“PSUs”); and (iii) service-based non-qualified stock options (“stock options”). Please see Note 12, “Stock-Based Compensation,” in the Notes to Consolidated Financial Statements included in Item 8 of the Company’s Annual Report on Form 10-K for the year ended February 2, 2025 for a detailed description of the Company’s stock-based compensation awards, including information relating to vesting terms and service, performance and market conditions, and additional information.

Net income for the twenty-six weeks ended August 3, 2025 and August 4, 2024 included $26.0 million and $26.9 million, respectively, of pre-tax expense related to stock-based compensation, with related recognized income tax benefits of $3.2 million and $3.3 million, respectively.

The fair value of RSUs is equal to the closing price of the Company’s common stock on the date of grant and is expensed over the RSUs’ requisite service periods.


(In thousands, except per RSU data)	RSUs	Weighted Average Grant Date Fair Value Per RSU
Non-vested at February 2, 2025	1,069	$	93.45
Granted	826	69.05
Vested	403	91.13
Forfeited	108	87.17
Non-vested at August 3, 2025	1,384	$	80.06

PSU awards granted to employees have a three-year service period. Each award is subject to various performance and/or market conditions. The final number of shares to be earned, if any, is contingent upon the Company’s achievement of goals for the applicable performance period.

For awards granted in 2022, 50% of the award was based on the Company’s total shareholder return (“TSR”) relative to a pre-established group of industry peers during a three-year period from the grant date, for which the Company achieved performance between the target and maximum levels. The other 50% of the award was based on the Company’s cumulative earnings before interest and taxes (“EBIT”) during the fiscal three-year performance period, for which the performance condition was not achieved. The holders of the awards earned an aggregate of 42,000 shares.

For awards granted in 2023, 2024, and 2025, 50% of the award is based on the Company’s TSR relative to a pre-established group of industry peers during a three-year period from the grant date and 50% is based on the Company’s average return on invested capital (“ROIC”) during a fiscal three-year performance period.

The Company records expense ratably over the three-year service period, with expense determined as follows: (i) TSR-based portion of the awards is based on the grant date fair value regardless of whether the market condition is satisfied because the awards are subject to market conditions and (ii) EBIT- and ROIC-based portion of the awards are based on the grant date fair value per share and the Company’s current expectations of the probable number of shares that will ultimately be issued.

The grant date fair value of the awards is established as follows: (i) TSR-based portion of the awards uses a Monte Carlo simulation model and (ii) EBIT- and ROIC-based portion of the awards are based on the closing price of the Company’s common stock reduced for the present value of any dividends expected to be paid on such common stock during the three-year service period, as these contingently issuable PSUs do not accrue dividends.

The following summarizes the assumptions used to estimate the fair value of PSUs subject to market conditions that were granted during the twenty-six weeks ended August 3, 2025 and the resulting weighted average grant date fair value:


	8/3/25
Weighted average risk-free interest rate	3.81		%
Weighted average Company volatility	47.02		%
Expected annual dividends per share	$	0.15
Weighted average grant date fair value per PSU	$	102.81

For certain of the awards granted, the after-tax portion of the award is subject to a holding period of one year after the vesting date. For these awards, the grant date fair value was discounted 4.50% for the restriction of liquidity, which was calculated using the Finnerty model.


(In thousands, except per PSU data)	PSUs	Weighted Average Grant Date Fair Value Per PSU
Non-vested at February 2, 2025	266	$	110.64
Granted	192	85.12
Increase due to market conditions achieved above target	9	102.88

Vested	42	102.88
Forfeited	14	117.79
Non-vested at August 3, 2025	411	$	99.13

The Company estimates the fair value of stock options at the date of grant using the Black-Scholes-Merton model. The estimated fair value of the stock options granted is expensed over the stock options’ requisite service periods. There were no stock options granted during the twenty-six weeks ended August 3, 2025.


(In thousands, except per stock option data)	Stock Options	Weighted Average Exercise Price Per Stock Option
Outstanding at February 2, 2025	504	$	92.31
Granted	—	—
Exercised	20	68.84
Forfeited / Expired	46	93.44
Outstanding at August 3, 2025	438	$	93.24