In 2021, Teledyne issued approximately 9.5 million shares in connection with the FLIR acquisition. See Note 3 for additional information about the FLIR acquisition. Shares issued from treasury stock include stock options exercised as well as shares issued under certain other compensation plans.

In January 2016, the Company’s Board of Directors authorized a stock repurchase program authorizing the Company to repurchase up to 3,000,000 shares of its common stock. The number of shares that the Company may repurchase will depend on a variety of factors, such as share price, levels of cash and borrowing capacity available, alternative investment opportunities available immediately or longer-term, and other regulatory, market or economic conditions. Although the Company has no current plans to repurchase stock, future repurchases, if any, are expected to be funded with cash on hand and borrowings under the Company’s credit facility. No repurchases were made since 2015.

Teledyne has long-term incentive plans which provide its Board of Directors the flexibility to grant restricted stock, restricted stock units, performance shares, non-qualified stock options, incentive stock options and stock appreciation rights to officers and employees of Teledyne. During 2022, 2021 and 2020, the Company has granted time-based stock options, time-based restricted stock unit awards, and performance-based restricted stock unit awards. Employee stock options become exercisable in one-third increments on the first, second and third anniversary of the grant and have a maximum 10-year life. Employee time-based restricted stock units vest in one-third increments on the first, second and third anniversary of the grant. Performance-based restricted stock awards granted during 2022, 2021 and 2020 may be earned based upon a time-based component and the performance of the Company's return to stockholders over a three-year period.

In 2021, the Company discontinued the Performance Share Plan ("PSP"), with an immaterial amount of compensation expense recorded in 2022 and 2021. Teledyne’s PSP provided grants of performance share units, which key officers and executives could earn if Teledyne met specified performance objectives over a three-year period. Awards were payable in cash and to the extent available, shares of Teledyne common stock.

The total pretax intrinsic value of options exercised during 2022 and 2021 (which is the amount by which the stock price exceeded the exercise price of the options on the date of exercise) was $53.7 million and $64.2 million, respectively. At January 1, 2023, the intrinsic value of stock options outstanding was $312.6 million and the intrinsic value of stock options exercisable was $306.1 million. During 2022 and 2021, the amount of cash received from the exercise of stock options was $23.6 million and $25.4 million, respectively.

The fair value of stock options is determined by using a lattice-based option pricing model. The Company uses a combination of its historical stock price volatility and the volatility of exchange traded options, if any, on the Company stock to compute the expected volatility for purposes of valuing stock options granted. The period used for the historical stock price corresponded to the expected term of the options. The period used for the exchange traded options, if any, included the longest-dated options publicly available, generally three months. The expected dividend yield is based on Teledyne’s practice of not paying dividends. The risk-free rate of return is based on the yield of U.S. Treasury Strips with terms equal to the expected life of the options as of the grant date. The expected life in years is based on historical actual stock option exercise experience.

Stock option transactions for Teledyne’s stock option plans are summarized as follows:



	2022			2021			2020
	Shares	Weighted Average Exercise Price		Shares	Weighted Average Exercise Price		Shares	Weighted Average Exercise Price
Beginning balance	1,793,857	$	206.08	1,819,147	$	170.10	1,988,576	$	130.67
Granted	135,751	$	360.39	211,973	$	440.48	247,273	$	382.91
Exercised	(179,828)	$	131.44	(213,384)	$	118.55	(382,554)	$	95.22
Canceled or expired	(23,049)	$	397.36	(23,879)	$	328.15	(34,148)	$	252.43
Ending balance	1,726,731	$	223.43	1,793,857	$	206.08	1,819,147	$	170.10
Options exercisable at end of period	1,395,949	$	182.53	1,328,191	$	148.73	1,242,786	$	118.57

The following table provides certain information with respect to stock options outstanding and stock options exercisable at January 1, 2023, under the stock option plans.


	Stock Options Outstanding				Stock Options Exercisable
Range of Exercise Prices	Shares	Weighted Average Exercise Price		Remaining life in years	Shares	Weighted Average Exercise Price
$40.70-$99.99	395,285	$	84.21	2.0	395,285	$	84.21
$100.00-$199.99	519,692	$	153.53	4.6	519,692	$	153.53
$200.00-$299.99	279,956	$	217.67	6.1	279,956	$	217.67
$300.00-$399.99	338,503	$	373.88	8.2	135,248	$	382.91
$400.00-$445.21	193,295	$	440.89	8.7	65,768	$	440.90



	1,726,731	$	223.43	5.4	1,395,949	$	182.53

The following table shows restricted stock award activity:


	Employee Time-Based Restricted Stock Units			Employee Performance-Based Restricted Stock Awards			Non-Employee Directors Restricted Stock Units
Restricted Stock:	Shares	Weighted average fair value per share		Shares	Weighted average fair value per share		Shares		Weighted average fair value per share
Balance, December 29, 2019	—	$	—	56,412	$	158.62	$	9,067	$	199.90
Granted	—	$	—	10,080	$	360.33	3,692		$	312.41
Vested	—	$	—	(23,087)	$	114.74	(2,640)		$	249.72
Forfeited/Canceled	—	$	—	—	$	—	(353)		$	311.17
Balance, January 3, 2021	—	$	—	43,405	$	228.80	9,766		$	224.94
Granted	62,974	$	409.41	10,227	$	334.92	2,592		$	450.27
Vested	(8,720)	$	409.41	(15,423)	$	176.64	(5,300)		$	227.90
Forfeited/Canceled	(4,903)	$	409.41	(380)	$	176.64	—		$	—
Balance, January 2, 2022	49,351	$	409.41	37,829	$	279.27	7,058		$	308.54
Granted	89,472	$	360.39	19,492	$	427.51	3,904		$	451.13
Vested	(15,698)	$	409.41	(17,522)	$	200.00	(1,440)		$	450.27
Forfeited/Canceled	(5,653)	$	399.20	(398)	$	388.15	—		$	—
Balance, January 1, 2023	117,472	$	372.51	39,401	$	386.76	9,522		$	345.57

Prior to 2021, the Company had no outstanding employee restricted stock units subject only to time-based vesting. As part of the acquisition of FLIR, the Company assumed certain unvested restricted stock units that were issued by FLIR in March 2021. The unvested restricted stock units were converted to 62,974 Teledyne restricted stock units. In October 2022, the Company granted 89,472 restricted stock units with a weighted average fair value of $360.39 per share. The Company recorded $7.8 million in compensation expense related to restricted stock units to employees for both fiscal years 2022 and 2021. The majority of the expense related to these restricted stock units is included in the Digital Imaging segment results. This amount can be impacted by employee retirements, terminations or other awards granted during the remainder of the year. At January 1, 2023, there was $36.8 million of total estimated unrecognized compensation cost related to non-vested awards which is expected to be recognized over a weighted-average period of approximately 2.5 years.

Under Teledyne’s restricted stock award program key officers and executives receive a grant of stock equal to a specified percentage of the participant’s annual base salary at the date of grant. The restricted stock is subject to transfer and forfeiture restrictions during an applicable “restricted period”. The restrictions have both time-based and performance-based components. The restricted period expires (and the restrictions lapse) on the third anniversary of the date of grant, subject to the achievement of stated performance objectives over a specified three-year performance period. If employment is terminated (other than by death, retirement or disability) during the restricted period, the stock grant is forfeited.

The estimated expense for restricted stock awards with both time-based and performance-based components to employees is based on a lattice-based simulation which takes into consideration several factors including volatility, risk free interest rates and the correlation of Teledyne’s stock price with the comparator, the S&P 500 Index for awards granted since 2021, the Russell 1000 Index for awards granted from 2018 to 2020 and the Russell 2000 for awards granted prior to 2018. The Company recorded $5.1 million, $3.5 million and $3.3 million in compensation expense related to restricted stock awards to employees, for fiscal years 2022, 2021 and 2020, respectively. At January 1, 2023, there was $6.7 million of total estimated unrecognized compensation cost related to non-vested awards which is expected to be recognized over a weighted-average period of approximately 1.5 years.

Non-employee directors each received restricted stock units valued at $170,000 in 2022, $130,000 in 2021 and $110,000 in 2020 or valued at half the amount for a person who becomes a director for the first time after the date of the Annual Meeting. The restricted stock units generally vest one year following the date of grant and are settled in shares of common stock on the date of vesting unless a director has elected to defer settlement of the award until his or her separation from Board service. The annual expense related to non-employee director’s restricted stock units was $1.7 million for 2022, $1.2 million for 2021 and