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Benefit plans and stock-based compensation | 12 Months Ended
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Mar. 27, 2021
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] |
Benefit plans and stock-based compensation |
8. | Benefit plans and stock-based compensation:
(a) | Stock option plans and arrangements:
| (i) | The Company can issue stock options, stock appreciation rights, deferred share units and restricted stock units to executive management, key employees and directors under the following stock-based compensation plans. The Company’s stock trades on the NYSE American and is valued in USD, as such all prices in this note will be denominated in USD.
The Company has a Long-Term Incentive Plan under which awards may be made in order to attract and retain the best available personnel for positions of substantial responsibility, to provide additional incentive to employees and to promote the success of the Company. Any employee or consultant selected by the administrator is eligible for any type of award provided for under the Long-Term Incentive Plan, except that incentive stock options may not be granted to consultants. The Long-Term Incentive Plan provided for the grant of units and performance units or share awards. As of March 27, 2021, there were 80,000 cash-based stock appreciation rights that were exercisable under the Long-Term Incentive Plan. The stock appreciation rights outstanding under the Long-Term Incentive Plan have a weighted average exercise price of $1.12. The Company has not made any grants under this incentive plan in the past three years. As at March 27, 2021, the Company has recognized a liability of $0.3 million in relation to these stock appreciation rights (March 28, 2020 - nil). As of March 27, 2021, there were stock options to purchase 253,147 Class A voting shares outstanding under the Long-Term Incentive Plan. During fiscal 2021, 2020, and 2019 no stock options were granted under the Long-Term Incentive Plan. As of March 27, 2021, 100% of the outstanding stock options were fully vested, accordingly unrecognized compensation relating to these options are nil. Total compensation cost for options recognized in expenses was nil, ($26,000), and $10,000 during fiscal 2021, 2020, and 2019, respectively. This plan expired in February 2016 and no further awards will be granted under this plan. However, the Long-Term Incentive Plan will remain in effect until the outstanding awards issued under the plan terminate or expire by their terms. On August 15, 2016, the Board of Directors adopted the Company’s Omnibus Long-Term Incentive Plan (the “Omnibus LTIP”), and same was approved by the Company’s shareholders on September 21, 2016. Further to the Omnibus LTIP, the Company’s directors, officers, senior executives and other employees of the Company or one of its subsidiaries, consultants and service providers providing ongoing services to the Company and its affiliates may from time-to-time be granted various types of compensation awards, as same are further described below. The Omnibus LTIP is meant to replace the Company’s former equity awards plans. A total of 1,000,000 shares of the Company’s Class A voting shares are reserved for issuance under the Omnibus LTIP. In no event shall the Company issue Class A voting shares, or awards requiring the Company to issue Class A voting shares, pursuant to the Omnibus LTIP if such issuance, when combined with the Class A voting shares issuable upon the exercise of awards granted under the Company’s former plan or any other equity awards plan of the Company, would exceed 1,796,088 Class A voting shares, unless such issuance of Class A voting shares or awards is approved by the shareholders of the Company. This limit shall not restrict however, the Company’s ability to issue awards under the Omnibus LTIP that are payable other than in shares. As of March 27, 2021, there were stock options to purchase 142,000 Class A voting shares outstanding under the Omnibus LTIP, all of which were granted during fiscal 2017, with a three year vesting period, with an average exercise price of $1.43 and an expiration date of 10 years after the grant date. No additional stock options were granted under this plan since then. The weighted-average grant-date fair value of the options granted during fiscal 2017 was $1.34. The fair value of the issued options in fiscal 2017 was calculated as of the date of their grant, using the Black-Scholes option pricing model with the following weighted-average assumptions: Dividend yield – 0%; Expected volatility – 114.63%; Risk-free interest rate –2.2%; and expected term in years – 10 years. As of March 27, 2021, 100% of the outstanding stock options were fully vested, accordingly unrecognized compensation relating to these options are nil. Total compensation cost for options recognized in expenses was nil, $21,000, and $68,000 during fiscal 2021, 2020, and 2019, respectively. The Company has outstanding employee stock options issued under the Birks Employee Stock Option Plan (the “Birks ESOP”). Effective November 15, 2005, no awards are permitted to be granted under the Birks ESOP. However, the Birks ESOP will remain in effect until the outstanding awards issued under the plan terminate or expire by their terms. In March 2010, the Company offered employees who held options under this plan the right to amend their current options. The amended options terms would be consistent with the original grant except that the new options would have a lower exercise price, be exercisable for a lesser number of the Company’s Class A voting shares, have a new ten-year term and be subject to different terms in the event of a change in control or if the Company had a going-private transaction. The amended options have an exercise price of $1.05 per share. As of March 27, 2021, March 28, 2020, and March 30, 2019, there were nil, 2,818, and 3,060, Class A voting shares underlying options granted under the Birks ESOP, respectively. No compensation expense was required to be recorded related to the amended option transaction and no compensation expense was required to be recorded for the outstanding option under this plan for the years ended March 27, 2021, March 28, 2020, and March 30, 2019. The following is a summary of the activity of Birks’ stock option plans and arrangements.
|  | Options |  |  | Weighted average exercise price |
Outstanding March 31, 2018 |  |  | 813,666 |  |  | $ | 1.13 |
Equity cash-out payment(a) |  |  | (51,400 | ) |  |  | 1.00 |
Forfeited |  |  | (21,206 | ) |  |  | 1.11 |
Outstanding March 30, 2019 |  |  | 741,060 |  |  |  | 1.14 |
Exercised |  |  | (10,000 | ) |  |  | 0.78 |
Forfeited |  |  | (26,242 | ) |  |  | 1.43 |
Outstanding March 28, 2020 |  |  | 704,818 |  |  |  | 1.13 |
Exercised |  |  | (226,853 | ) |  |  | 1.10 |
Forfeited |  |  | (82,818 | ) |  |  | 1.66 |
Outstanding March 27, 2021 |  |  | 395,147 |  |  | $ | 1.04 |
(a) | In connection with its restructuring initiative, the Company offered an equity cash-out payment of $20,000 (USD$16,000) to a former senior executive for 35,000 options under the Long-term incentive plan, 14,000 options under the Omnibus LTIP and 2,400 options under the Birks ESOP.
A summary of the status of Birks’ stock options at March 27, 2021 is presented below:
|  | Options outstanding |  |  | Options exercisable |
Exercise price |  | Number outstanding |  |  | Weighted average remaining life (years) |  |  | Weighted average exercise price |  |  | Number exercisable |  |  | Weighted average exercise price |
$ 0.78 |  |  | 145,000 |  |  |  | 4.5 |  |  | $ | 0.78 |  |  |  | 145,000 |  |  | $ | 0.78 |
$ 0.84 |  |  | 100,000 |  |  |  | 2.1 |  |  |  | 0.84 |  |  |  | 100,000 |  |  |  | 0.84 |
$ 0.89 |  |  | 5,000 |  |  |  | 1.6 |  |  |  | 0.89 |  |  |  | 5,000 |  |  |  | 0.89 |
$ 1.43 |  |  | 142,000 |  |  |  | 5.6 |  |  |  | 1.43 |  |  |  | 142,000 |  |  |  | 1.43 |
$ 1.66 |  |  | 3,147 |  |  |  | 2.5 |  |  |  | 1.66 |  |  |  | 3,147 |  |  |  | 1.66 |
|  |  | 395,147 |  |  |  | 3.2 |  |  | $ | 1.04 |  |  |  | 395,147 |  |  | $ | 1.04 |
| (ii) | Under plans approved by the former Board of Directors of Mayors, the Company had outstanding stock options issued to employees and members of the Company’s Board of Directors. During fiscal 2019, the remaining 41 options were settled in cash for an average of $0.78 per option and no options remain outstanding. No further awards will be granted under these plans. No compensation expense was required to be recorded related to the options outstanding under this program for the years ended March 27, 2021, March 28, 2020, and March 30, 2019, 2018, respectively.
The following is a summary of the activity of Mayors stock option plans:
|  | Options |  |  | Weighted average exercise price |
Outstanding March 31, 2018 |  |  | 41 |  |  |  | 1.05 |
Settled in cash |  |  | (41 | ) |  |  | 0.78 |
Outstanding March 30, 2019 |  | $ | 0 |  |  | $ | 0.00 |
(b) | As of March 27, 2021, the Company had outstanding warrants exercisable into 251,484 shares of the Company’s Class A voting shares (382,693 as of March 28, 2020 and as of March 30, 2019, respectively). These warrants have a weighted average exercise price of $3.46 per share and expire on August 20, 2022. As of November 1, 2005, these awards were fully vested and no additional compensation expense will be recognized. 131,209 warrants were exercised in fiscal 2021 for proceeds of USD $438,000 (approximately $556,000 in Canadian dollars).
(c) | Restricted stock units and deferred share unit plans:
On September 17, 2020 and November 15, 2016, the Company issued 375,000 and 121,500 cash settled restricted stock units (RSU) to members of senior management under the Omnibus LTIP. These units vest after three years and expire one month following the vesting date. Compensation expense is based on the fair value of the RSU and the liability is re-measured at each reporting period. During fiscal 2021, 68,000 of the September 17, 2020 issued units had vested, and all of the fiscal 2016 issued RSU’s are fully vested. At March 27, 2021, there were 375,000 outstanding RSU’s (March 28, 2020 – nil RSU outstanding). On September 17, 2020 , October 7, 2019 , June 20, 2019 , September 14, 2018 , September 7, 2017 and November 15, 2016 , the Company also issued 223,878, 157,890, 86,954, 133,588, 74,466 and 55,944 of cash settled deferred share units (DSU) to members of the board of directors. During fiscal 2020, 36,715 DSU’s were exercised following the retirement of a board member. At March 27, 2021, 689,012 DSU’s are outstanding (March 28, 2020–465,134 DSU’s outstanding). These units are exercisable immediately upon the date the member ceases being a director and expire on December 31 of the following year. Compensation expense is based on the fair value of the DSU and the liability is re-measured at each reporting period. A summary of the status of Birks’ restricted stock units and deferred share units at March 27, 2021 is presented below:
|  | DSU |
Outstanding March 31, 2018 |  |  | 130,410 |
Grants of new units |  |  | 133,588 |
Forfeited |  |  | (6,993 | )
Outstanding March 30, 2019 |  |  | 257,005 |
Grants of new units |  |  | 244,844 |
Forfeited |  |  | (36,715 | )
Outstanding March 28, 2020 |  |  | 465,134 |
Grants of new units |  |  | 223,878 |
Outstanding March 27, 2021 |  |  | 689,012 |
The fair value of cash settled DSU’s is measured based on the Company’s share price at each period end. As at March 27, 2021, the liability for all cash settled DSU’s was $3.1 million (March 28, 2020 - $0.1 million). The closing stock price used to determine the liability was $3.62. Total compensation cost for DSU’s recognized in expense was $3.0 million, nil and $0.1 million in fiscal 2021, 2020, and 2019.
|  | RSU |
Outstanding March 31, 2018 |  |  | 112,000 |
Settled in cash |  |  | (5,500 | )
Forfeited |  |  | (4,500 | )
Outstanding March 30, 2019 |  |  | 102,000 |
Settled in cash |  |  | (102,000 | )
Outstanding March 28, 2020 |  |  | 0 |
Grants of new units |  |  | 375,000 |
Outstanding March 27, 2021 |  |  | 375,000 |
The fair value of cash settled RSU’s is measured based on the Company’s share price at each period end. As at March 27, 2021, the liability for all vested cash settled RSU’s w as $0.3 million (March 28, 2020 - $nil). The closing stock price used to determine the liability was $3.62. Total compensation cost for RSU’s recognized in expenses was $0.3 million, nil, and nil in fiscal 2021, 2020, and 2019. The weighted average remaining contractual life of the unvested RSU’s is 2.7 years

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