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Stock-Based Compensation | 6 Months Ended
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Feb. 26, 2022
Stock-Based Compensation [Abstract] |
Stock-Based Compensation | Note 4. Stock-Based Compensation The Company accounts for all stock-based payments in accordance with Accounting Standards Codification Topic 718, “Compensation—Stock Compensation,” as amended. Stock-based compensation expense included in Operating expenses for the thirteen- and twenty-six-week periods ended February 26, 2022 and February 27, 2021 was as follows: Thirteen Weeks Ended Twenty-Six Weeks Ended February 26, February 27, February 26, February 27, 2022 2021 2022 2021Stock options $ 217 $ 544 $ 805 $ 1,221Restricted stock units 3,306 3,819 8,009 7,118Performance share units 889 345 1,197 558Associate Stock Purchase Plan 88 48 178 97Total 4,500 4,756 10,189 8,994Deferred income tax benefit (1,139) (1,174) (2,476) (2,204)Stock-based compensation expense, net $ 3,361 $ 3,582 $ 7,713 $ 6,790 ‎Stock Options The Company discontinued its grants of stock options in fiscal year 2020. The fair value of each option grant in previous fiscal years was estimated on the date of grant using the Black-Scholes option pricing model. A summary of the Company’s stock option activity for the twenty-six-week period ended February 26, 2022 is as follows: Options Weighted-Average Exercise Price per Share Weighted-Average Remaining Contractual Term (in years) Aggregate Intrinsic ValueOutstanding on August 28, 2021 1,130 $ 76.38 Granted — — Exercised (183) 65.96 Canceled/Forfeited (32) 83.18 Outstanding on February 26, 2022 915 $ 78.22 2.1 $ 2,225Exercisable on February 26, 2022 844 $ 77.80 2.0 $ 2,225 The unrecognized stock-based compensation cost related to stock option expense at February 26, 2022 was $565 and will be recognized over a weighted-average period of 0.6 years. The total intrinsic value of options exercised, which represents the difference between the exercise price and the market value of Class A Common Stock measured at each individual exercise date, during the twenty-six-week periods ended February 26, 2022 and February 27, 2021 was $3,351 and $1,494, respectively. Performance Share Units In fiscal year 2020, the Company began granting performance share units (“PSUs”) as part of its long-term stock-based compensation program. PSUs cliff vest after a three year performance period based on the achievement of specific performance goals as set forth in the applicable award agreement. Based on the extent to which the performance goals are achieved, vested shares may range from 0% to 200% of the target award amount. The following table summarizes all transactions related to PSUs under the MSC Industrial Direct Co., Inc. 2015 Omnibus Incentive Plan (the “2015 Omnibus Incentive Plan”) (based on target award amounts) for the twenty-six-week period ended February 26, 2022: Shares Weighted-Average Grant Date Fair ValueNon-vested PSUs at August 28, 2021 58 $ 75.52Granted 46 84.96Vested — —Canceled/Forfeited (10) 76.05Non-vested PSUs at February 26, 2022 (1) 94 $ 80.06 (1) Excludes approximately 9 shares of accrued incremental dividend equivalent rights on outstanding PSUs granted under the 2015 Omnibus Incentive Plan. The fair value of each PSU is the closing stock price on the New York Stock Exchange (the “NYSE”) of Class A Common Stock on the date of grant. PSUs are expensed over the three year performance period of each respective grant. Forfeitures of share-based awards are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The Company uses historical data to estimate pre-vesting PSU forfeitures and records stock-based compensation expense only for PSU awards that are expected to vest. Upon vesting, subject to the achievement of specific performance goals, a portion of the PSU award may be withheld to satisfy the statutory income tax withholding obligation, and the remaining PSUs will be settled in shares of Class A Common Stock. These awards accrue dividend equivalents on the underlying PSUs (in the form of additional stock units) based on dividends declared on Class A Common Stock and these dividend equivalents are paid to the award recipient in the form of unrestricted shares of Class A Common Stock on the vesting dates of the underlying PSUs, subject to the same performance vesting requirements. The unrecognized stock-based compensation cost related to the PSUs at February 26, 2022 was $5,264 and is expected to be recognized over a weighted-average period of 2.0 years. Restricted Stock Units A summary of the Company’s non-vested restricted stock unit (“RSU”) award activity under the 2015 Omnibus Incentive Plan for the twenty-six-week period ended February 26, 2022 is as follows: Shares Weighted-Average Grant Date Fair ValueNon-vested RSUs at August 28, 2021 524 $ 76.69Granted 173 84.74Vested (176) 76.74Canceled/Forfeited (40) 76.89Non-vested RSUs at February 26, 2022 (1) 481 $ 79.54 (1) Excludes approximately 56 shares of accrued incremental dividend equivalent rights on outstanding RSUs granted under the 2015 Omnibus Incentive Plan. The fair value of each RSU is the closing stock price on the NYSE of Class A Common Stock on the date of grant. RSUs are expensed over the vesting period of each respective grant. Forfeitures of share-based awards are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The Company uses historical data to estimate pre-vesting RSU forfeitures and records stock-based compensation expense only for RSU awards that are expected to vest. Upon vesting, a portion of the RSU award may be withheld to satisfy the statutory income tax withholding obligation, and the remaining RSUs will be settled in shares of Class A Common Stock. These awards accrue dividend equivalents on the underlying RSUs (in the form of additional stock units) based on dividends declared on Class A Common Stock and these dividend equivalents are paid to the award recipient in the form of unrestricted shares of Class A Common Stock on the vesting dates of the underlying RSUs. The unrecognized stock-based compensation cost related to the RSUs at February 26, 2022 was $32,032 and is expected to be recognized over a weighted-average period of 2.9 years.

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