Shareholders’ Equity

Common Stock Repurchases

In September 2015, the Board of Directors authorized the repurchase of up to $100.0 million of the Company's outstanding common stock through September 1, 2017. The Company purchased and retired 280,168 shares for $9.8 million in fiscal 2017, for a total under the repurchase plan of 2,277,466 shares for $71.9 million.

Dividends

The Company paid dividends totaling $16.3 million, $14.7 million and $13.7 million during fiscal 2019, 2018 and 2017, respectively.

Stock-based Compensation

All stock-based payments to employees and directors are recognized in selling and administrative expenses on the consolidated statements of income. Awards subject to graded vesting are recognized using the accelerated recognition method over the requisite service period.

The table below summarizes the stock-based compensation expense related to the equity awards for fiscal 2019, 2018 and 2017.



(Dollars in Millions)	Fiscal Year Ended							Unrecognized Compensation Expense at
	April 27, 2019		April 28, 2018			April 29, 2017		April 27, 2019
2014 Incentive Plan:
RSAs	$	10.9	$	(2.0	)	$	5.7	$	5.0
RSUs	2.2		5.0			5.5		1.6
Director Awards	0.9		1.0			0.9		—
Total 2014 Incentive Plan	14.0		4.0			12.1		6.6

2010 Stock Plan:
RSUs	—		—			0.1		—
Stock Options	—		—			0.1		—
Total 2010 Stock Plan	—		—			0.2		—

2007 Stock Plan:
Stock Options	—		—			0.1		—
Total 2007 Stock Plan	—		—			0.1		—

Total Stock-based Compensation Expense	$	14.0	$	4.0		$	12.4	$	6.6

2014 Incentive Plan

In September 2014, the Methode Electronics, Inc. 2014 Omnibus Incentive Plan (the “2014 Incentive Plan”) was approved by the Company’s stockholders. The 2014 Incentive Plan provides for discretionary grants of stock options, stock appreciation rights, restricted stock awards, restricted stock units and performance units to key employees and directors. The 2014 Incentive Plan is intended to promote the success of the Company and to increase stockholder value by providing an additional means to attract, motivate, retain and reward selected employees and eligible directors through the grant of equity awards.

The number of shares of common stock that may be issued under the 2014 Incentive Plan is 3,000,000, less one share for every one share of common stock issued or issuable pursuant to awards made after May 3, 2014 under the 2007 Stock Plan or 2010 Stock Plan. Awards that may be settled only in cash will not reduce the number of shares available for issuance under the 2014 Incentive Plan.

Shares issuable under the 2014 Incentive Plan may be authorized but unissued shares or treasury shares. If any award granted under the 2014 Incentive Plan (or, after May 3, 2014, an award under the 2007 Stock Plan or 2010 Stock Plan) expires, terminates, is forfeited or canceled, is settled in cash in lieu of shares of common stock, or is exchanged for a non-stock award under certain circumstances, the shares subject to the award will again be available for issuance under the 2014 Incentive Plan. As of April 27, 2019, there were 1,344,034 shares available for award under the 2014 Incentive Plan.

In fiscal 2016, the Compensation Committee established a long-term incentive program (the “LTIP”) for key employees consisting of performance-based restricted stock awards (“RSAs”) and time-based restricted stock units (“RSUs”).

Restricted Stock Awards ("RSAs")

The grant of RSAs under the 2014 Incentive Plan are performance-based awards that are scheduled to vest at the end of fiscal 2020 based on the achievement of an EBITDA hurdle. The number of shares ultimately earned could range from 0% to 150% of the target award based on the achievement of the EBITDA performance condition. The fair value of the RSAs granted was based on the closing stock price on the date of grant. All non-vested RSAs accrue dividend equivalents, which are subject to vesting and paid in cash upon release. Accrued dividends are forfeitable to the extent that the underlying awards do not vest.

Per ASC 718, stock-based compensation expense is recognized for these awards over the vesting period based on the projected probability (70% confidence) of achievement of the EBITDA hurdle in fiscal 2020. In each period, the stock-based compensation expense may be adjusted, as necessary, in response to any changes in the Company’s forecast with respect to achieving the fiscal 2020 EBITDA hurdle.

In fiscal 2018, the Company determined that only a threshold performance level would be achieved and adjusted its stock-based compensation expense for these awards. The result was a reversal of previously recognized stock-based compensation expense of $6.0 million. Stock-based compensation expense for these awards in fiscal 2018 was a credit of $2.0 million.

In fiscal 2019, the Company determined that the target hurdle would be achieved based on the recent acquisition of Grakon and adjusted its stock-based compensation expense for these awards. The result was an additional expense of $7.4 million. Stock-based compensation expense for these awards in fiscal 2019 was $10.9 million.

The following table summarizes the RSA activity under the 2014 Incentive Plan:



	RSA Shares		Wtd. Avg. Grant Date Fair Value
Non-vested and Unissued at April 30, 2016	1,161,000		$	33.35
Awarded	72,000		$	34.90
Vested	—		$	—
Forfeited	(64,500	)	$	33.78
Non-vested and Unissued at April 29, 2017	1,168,500		$	33.42
Awarded	128,738		$	40.92
Vested	—		$	—
Forfeited	(126,000	)	$	34.42
Non-vested and Unissued at April 28, 2018	1,171,238		$	34.13
Awarded	11,625		$	38.75
Vested	—		$	—
Forfeited	(151,455	)	$	34.79
Non-vested and Unissued at April 27, 2019	1,031,408		$	34.09

Restricted Stock Units

RSUs granted under the 2014 Incentive Plan vest over a pre-determined period of time, generally between three to five years from the date of grant. The fair value of the RSUs granted was based on the closing stock price on the date of grant.

The following table summarizes RSU activity granted under the 2014 Incentive Plan:



	RSU Shares		Wtd. Avg. Grant Date Fair Value
Non-vested at April 30, 2016	576,000		$	33.39
Awarded	32,000		$	34.90
Vested	(11,333	)	$	33.78
Forfeited	(28,667	)	$	33.78
Non-vested at April 29, 2017	568,000		$	33.45
Awarded	30,925		$	41.82
Vested	(160,553	)	$	33.72
Forfeited	(56,000	)	$	34.42
Non-vested at April 28, 2018	382,372		$	33.87
Awarded	7,750		$	38.75
Vested	(152,328	)	$	33.75
Forfeited	(49,950	)	$	32.42
Non-vested at April 27, 2019	187,844		$	34.55

Director Awards

During fiscal 2019, fiscal 2018 and fiscal 2017, the Company issued 24,000 shares, 24,000 shares and 27,000 shares, respectively, of common stock to our independent directors, all of which vested immediately upon grant.

2010 Stock Plan

The 2010 Stock Plan permitted a total of 2,000,000 shares of common stock to be awarded to participants in the form of nonqualified stock options, incentive stock options, restricted stock awards, restricted stock units, stock appreciation rights, and performance share units. With the approval of the 2014 Incentive Plan, no further awards are being granted under the 2010 Stock Plan.

The following table summarizes stock option activity under the 2010 Stock Plan:



	Shares		Wtd. Avg. Exercise Price		Weighted-Average Life (years)	Aggregate Intrinsic Value (in millions)
Outstanding and Exercisable at April 30, 2016	197,332		$	24.55
Awarded	—		$	—
Exercised	(125,332	)	$	17.40
Forfeited	—		$	—
Outstanding and Exercisable at April 29, 2017	72,000		$	37.01	7.3	$	—
Awarded	—		$	—
Exercised	—		$	—
Forfeited	—		$	—
Outstanding and Exercisable at April 28, 2018	72,000		$	37.01	6.3	$	0.3
Awarded	—		$	—
Exercised	—		$	—
Forfeited	—		$	—
Outstanding and Exercisable at April 27, 2019	72,000		$	37.01	5.2	$	—

The aggregate intrinsic value represents the total pre-tax intrinsic value (the difference between the Company's closing stock price on the last trading day of the fiscal year and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on that date.

2007 Stock Plan

The 2007 Stock Plan permitted a total of 1,250,000 shares of common stock to be awarded to participants. With the approval of the 2014 Incentive Plan, no further awards are being granted under the 2007 Stock Plan.

The following table summarizes stock option activity under the 2007 Stock Plan:



	Shares		Wtd. Avg. Exercise Price		Weighted-Average Life (years)	Aggregate Intrinsic Value (in millions)
Outstanding and Exercisable at April 30, 2016	79,666		$	28.91
Awarded	—		$	—
Exercised	(22,497	)	$	21.52
Forfeited	—		$	—
Outstanding and Exercisable at April 29, 2017	57,169		$	31.82	6.8	$	0.7
Awarded	—		$	—
Exercised	(13,333	)	$	24.67
Forfeited	(1,668	)	$	37.01
Outstanding and Exercisable at April 28, 2018	42,168		$	33.87	5.8	$	0.3
Awarded	—		$	—
Exercised	—		$	—
Forfeited	(7,500	)	$	37.01
Outstanding and Exercisable at April 27, 2019	34,668		$	33.20	4.6	$	0.1



Options Outstanding and Exercisable at April 27, 2019
Shares	Exercise Price		Avg. Remaining Life (Years)
5,000	$	10.55	1.2
29,668	$	37.01	5.2
34,668

Deferred RSUs

Under the 2014 Incentive Plan and 2010 Stock Plan, RSUs that have vested for certain executives, including the Company’s CEO, will not be delivered in common stock until after the executive terminates employment from the Company or upon a change of control. As of April 27, 2019, shares to be delivered to these executives were 60,600 shares under the 2014 Incentive Plan and 180,000 shares under the 2010 Stock Plan.

Under the 2007 Stock Plan, 225,000 shares of common stock subject to performance-based RSAs granted to our CEO in fiscal 2006 and 2007 were converted to RSUs. The shares of stock underlying the RSUs will not be issued and delivered until the earlier of: (1) thirty days after the CEO’s date of termination of employment with the Company and all of its subsidiaries and affiliates; or (2) the last day of the Company’s fiscal year in which the payment of common stock in satisfaction of the RSUs becomes deductible to the Company under Section 162(m) of the Code. As of April 27, 2019, 29,945 shares have been delivered in connection with these RSUs with a remaining balance to be delivered of 195,055 shares.

The RSUs are not entitled to voting rights or dividends, however a bonus in lieu of dividends are paid. The vested deferred RSUs are considered outstanding for earnings per share calculations.