Note 14 – Stock-Based Compensation

The Company has a shareholder-approved 10-year stock incentive plan covering 2,500,000 shares of SpartanNash’s common stock. The SpartanNash Company Stock Incentive Plan of 2015 (the “2015 Plan”) provides for the granting of stock options, stock appreciation rights, restricted stock, restricted stock units, stock awards, and other stock-based and stock-related awards to directors, officers and other key associates. Shares issued, as a result of stock option exercises, will be funded with the issuance of new shares. Holders of restricted stock and stock awards are entitled to participate in cash dividends and dividend equivalents. As of December 30, 2017, a total of 1,947,030 shares remained unissued under the 2015 Plan.

All outstanding unvested stock options and unvested shares of restricted stock vest immediately upon a “Change in Control,” as defined by the Plan. The Company has not issued any stock options since 2009 and all outstanding options are vested.

The following table summarizes stock option activity for 2017, 2016 and 2015:

						Weighted
				Weighted		Average
				Average		Remaining		Aggregate
	Shares			Exercise		Contractual		Intrinsic Value
	Under Options			Price		Life Years		(in thousands)
Options outstanding and exercisable at January 3, 2015		494,483		$	20.61		3.30	$	2,772
Exercised		(185,627	)		19.72				1,543
Cancelled/Forfeited		(63	)		11.50
Options outstanding and exercisable at January 2, 2016		308,793			21.15		2.46		773
Exercised		(107,338	)		23.46				1,043
Cancelled/Forfeited		(938	)		14.36
Options outstanding and exercisable at December 31, 2016		200,517			19.94		1.65		3,929
Exercised		(152,589	)		21.02				1,832
Cancelled/Forfeited		—			—
Options outstanding and exercisable at December 30, 2017		47,928		$	16.52		1.07	$	487

Cash received from option exercises was $3.2 million, $2.5 million and $3.7 million in 2017, 2016 and 2015, respectively.

Restricted shares awarded to associates vest ratably over a four-year service period and over one year for grants to the Board of Directors. Awards are subject to forfeiture and certain transfer restrictions prior to vesting. Compensation expense, representing the fair value of the stock at the measurement date of the award, is recognized over the required service period.

The following table summarizes restricted stock activity for 2017, 2016 and 2015:

				Weighted Average
				Grant-Date
	Shares			Fair Value
Outstanding and nonvested at January 3, 2015		600,653		$	23.08
Granted		314,595			26.59
Vested		(265,737	)		23.19
Forfeited		(11,956	)		23.85
Outstanding and nonvested at January 2, 2016		637,555			24.75
Granted		314,944			28.34
Vested		(255,156	)		24.56
Forfeited		(37,200	)		25.80
Outstanding and nonvested at December 31, 2016		660,143			26.48
Granted		296,297			34.68
Vested		(258,183	)		25.90
Forfeited		(84,513	)		29.11
Outstanding and nonvested at December 30, 2017		613,744		$	30.32

The total fair value of shares vested was $9.3 million, $6.6 million and $7.6 million in 2017, 2016 and 2015, respectively.

Stock-based compensation expense recognized and included in “Selling, general and administrative expenses” in the consolidated statements of operations, and related tax benefits were as follows:

(In thousands)	2017			2016			2015
Restricted stock	$	9,611		$	7,936		$	7,240
Tax benefits		(3,440	)		(2,976	)		(2,758	)
Stock-based compensation expense, net of tax	$	6,171		$	4,960		$	4,482

As of December 30, 2017, total unrecognized compensation cost related to non-vested share-based awards granted under the stock incentive plans was $4.0 million for restricted stock. The remaining compensation costs not yet recognized are expected to be recognized over a weighted average period of 2.3 years for restricted stock. All compensation costs related to stock options have been recognized.

The Company recognized tax deductions of $11.6 million, $8.0 million and $9.5 million related to the exercise of stock options and the vesting of restricted stock in 2017, 2016 and 2015, respectively.

The Company has a stock bonus plan covering 300,000 shares of SpartanNash common stock. Under the provisions of this plan, certain officers and key associates may elect to receive a portion of their annual bonus in common stock rather than cash and will be granted additional shares of common stock worth 20% of the portion of the bonus they elect to receive in stock. After the shares are issued, the holder is not able to sell or otherwise transfer the shares until the end of the holding period, which is currently 24 months. Compensation expense is recorded based upon the market price of the stock as of the measurement date. A total of 14,726 shares remained unissued under the stock bonus plan at December 30, 2017.

The Company also has an associate stock purchase plan covering 200,000 shares of SpartanNash common stock. The plan provides that associates of the Company may purchase shares at 95% of the fair market value. As of December 30, 2017, a total of 81,511 shares had been issued under the plan.