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Stock-Based Compensation (Tables) | 12 Months Ended
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Jun. 01, 2019
Valuation and Qualifying Accounts Disclosure |
Schedule of Pre-Tax Compensation Expense and Related Tax Benefits | Pre-tax compensation expense and the related income tax benefit for all types of stock-based programs was as follows for the periods indicated:
(In millions) |  | June 1, 2019 |  | June 2, 2018 |  | June 3, 2017
Employee stock purchase program |  | $ | 0.3 |  |  | $ | 0.3 |  |  | $ | 0.3 |
Stock option plans |  | (0.4 | ) |  | 2.6 |  |  | 2.0 |
Restricted stock units |  | 4.6 |  |  | 3.9 |  |  | 3.6 |
Performance share units |  | 2.8 |  |  | 0.9 |  |  | 2.8 |
Total |  | $ | 7.3 |  |  | $ | 7.7 |  |  | $ | 8.7 |
Tax benefit |  | $ | 1.6 |  |  | $ | 2.3 |  |  | $ | 3.1 |
Schedule of Fair Value of Employee Stock Options | In determining these values, the following weighted-average assumptions were used for the options granted during the fiscal years indicated:
| 2019 |  | 2018 |  | 2017
Risk-free interest rates (1) | 2.65-2.70% |  |  | 1.79 | % |  | 1.01 | %
Expected term of options (2) | 4.4 years |  |  | 4.6 years |  |  | 4.0 years |
Expected volatility (3) | 27 | % |  | 26 | % |  | 26 | %
Dividend yield (4) | 2.18-2.33% |  |  | 2.23 | % |  | 2.13 | %
Weighted-average grant-date fair value of stock options: |  |  |  |  |
Granted with exercise prices equal to the fair market value of the stock on the date of grant | $ | 8.05 |  |  | $ | 6.39 |  |  | $ | 5.50 |
(1) Represents term-matched, zero-coupon risk-free rate from the Treasury Constant Maturity yield curve, continuously compounded. (2) Represents historical settlement data, using midpoint scenario with 1-year grant date filter assumption for outstanding options. (3) The blended volatility approach was used. 90% term-matched historical volatility from daily stock prices and 10% percent weighted average implied volatility from the 90 days preceding the grant date. (4) Represents the quarterly dividend divided by the three-month average stock price as of the grant date, annualized and continuously
Schedule of Stock Option Plan Transactions | The following is a summary of the transactions under the Company's stock option plans:
| Shares Under Option |  | Weighted-Average Exercise Prices |  | Aggregate Intrinsic Value (in millions) |  | Weighted-Average Remaining Contractual Term (Years)
Outstanding at June 2, 2018 | 1,063,249 |  |  | $ | 30.33 |  |  | $ | 2.9 |  |  | 7.45
Granted at market | 156,008 |  |  | $ | 38.23 |  |  |  |  |
Exercised | (347,248 | ) |  | $ | 28.84 |  |  |  |  |
Forfeited or expired | (81,950 | ) |  | $ | 33.94 |  |  |  |  |
Outstanding at June 1, 2019 | 790,059 |  |  | $ | 32.17 |  |  | $ | 3.0 |  |  | 5.81
Ending vested + expected to vest | 790,059 |  |  | $ | 32.17 |  |  | $ | 3.0 |  |  | 5.81
Exercisable at end of period | 282,985 |  |  | $ | 28.51 |  |  | $ | 2.0 |  |  | 4.42
Schedule of Restricted Stock Unit (RSU) Activity | The following is a summary of restricted stock unit transactions for the fiscal years indicated:
| Share Units |  | Weighted Average Grant-Date Fair Value |  | Aggregate Intrinsic Value (in millions) |  | Weighted-Average Remaining Contractual Term (Years)
Outstanding at June 2, 2018 | 481,027 |  |  | $ | 32.20 |  |  | $ | 15.8 |  |  | 1.28
Granted | 91,304 |  |  | $ | 37.81 |  |  |  |  |
Forfeited | (31,922 | ) |  | $ | 35.94 |  |  |  |  |
Released | (229,128 | ) |  | $ | 31.40 |  |  |  |  |
Outstanding at June 1, 2019 | 311,281 |  |  | $ | 33.93 |  |  | $ | 11.0 |  |  | 1.10
Ending vested + expected to vest | 311,281 |  |  | $ | 33.93 |  |  | $ | 11.0 |  |  | 1.10
Schedule of Performance-based Stock Units (PSU) Activity | The following is a summary of performance share unit transactions for the fiscal years indicated:
| Share Units |  | Weighted Average Grant-Date Fair Value |  | Aggregate Intrinsic Value (in millions) |  | Weighted-Average Remaining Contractual Term (Years)
Outstanding at June 2, 2018 | 374,560 |  |  | $ | 30.76 |  |  | $ | 12.3 |  |  | 1.01
Granted | 207,568 |  |  | $ | 36.37 |  |  |  |  |
Forfeited | (19,093 | ) |  | $ | 35.90 |  |  |  |  |
Released | (239,679 | ) |  | $ | 31.55 |  |  |  |  |
Outstanding at June 1, 2019 | 323,356 |  |  | $ | 33.48 |  |  | $ | 11.5 |  |  | 1.13
Ending vested + expected to vest | 323,356 |  |  | $ | 33.48 |  |  | $ | 11.5 |  |  | 1.13
Schedule of Director Share Based Compensation | The exercise price of the stock options granted may not be less than the market price of the Company's common stock on the date of grant. Under the plan, the Board members received the following shares or options in the fiscal years indicated:
|  | 2019 |  | 2018 |  | 2017
Shares of common stock |  | 10,185 |  |  | 8,828 |  |  | 9,982 |
Shares through the deferred compensation program |  | 7,619 |  |  | 2,207 |  |  | 2,582 |
Herman Miller Consumer Stock Option Plan | Employee Stock Option |
Valuation and Qualifying Accounts Disclosure |
Schedule of Fair Value of Employee Stock Options | The following weighted-average assumptions were used to value the liability associated with HMCH stock options as of June 2, 2018:
|  | 2018
Risk-free interest rates (1) |  | 2.29 | %
Expected term of options (2) |  | 1.1 years |
Expected volatility (3) |  | 35 | %
Dividend yield |  | not applicable |
Strike price |  | 30.64 |
Per share value (4) |  | 8.24 |
(1) Represents the U.S. Treasury yield over the same period as the expected option term. (2) Represents the period of time that options granted are expected to be outstanding. (3) Amount is determined based on analysis of historical price volatility of the common stock of peer companies over a period equal to the expected term of the options. (4) Based on the Black-Scholes formula.
Schedule of Stock Option Plan Transactions |
| Shares Under Option |  | Weighted-Average Exercise Prices |  | Aggregate Intrinsic Value (in millions) |  | Weighted-Average Remaining Contractual Term (Years)
Outstanding at June 2, 2018 | 544,126 |  |  | $ | 24.04 |  |  | $ | 3.6 |  |  | 1.20
Exercised | (4,861 | ) |  | $ | 7.82 |  |  |  |  |
Forfeited | (468,558 | ) |  | $ | 24.39 |  |  |  |  |
Outstanding at June 1, 2019 | 70,707 |  |  | $ | 22.80 |  |  | $ | 0.5 |  |  | 0.20
Exercisable at end of period | 70,707 |  |  | $ | 22.80 |  |  | $ | 0.5 |  |  | 0.20

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