XML 55 R39.htm IDEA: XBRL DOCUMENT
v3.10.0.1

Stock-based Compensation (Tables) | 12 Months Ended
--- | ---
Dec. 31, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] |
Schedule of Stock-based Compensation Expense | The Company’s stock-based compensation expense for the year ended December 31, 2018 included PRSUs, stock options, RSUs and DSUs. A summary of the Company’s stock-based compensation expense is presented below:
| Year Ended December 31,
(in millions) | 2018 |  | 2017 |  | 2016
PRSU expense (benefit) | $ | 2.5 |  |  | $ | (6.5 | ) |  | $ | 3.9 |
Stock option expense | 6.7 |  |  | 7.1 |  |  | 5.3 |
RSU/DSU expense | 15.6 |  |  | 12.7 |  |  | 7.0 |
Total stock-based compensation expense | $ | 24.8 |  |  | $ | 13.3 |  |  | $ | 16.2 |
Summary of PRSU Activity and Related Information | A summary of the Company’s PRSU activity and related information for the years ended December 31, 2018 and 2017 is presented below:
(shares in millions) | Shares |  | Weighted Average Grant Date Fair Value
Awards unvested at December 31, 2016 | 1.7 |  |  | $ | 68.02 |
Granted | 1.6 |  |  | 59.64 |
Vested | (0.2 | ) |  | 59.39 |
Forfeited | (0.4 | ) |  | 65.48 |
Awards unvested at December 31, 2017 | 2.7 |  |  | 64.13 |
Granted | 0.2 |  |  | 51.72 |
Vested | (0.1 | ) |  | 68.57 |
Forfeited | (0.8 | ) |  | 68.07 |
Awards unvested at December 31, 2018 | 2.0 |  |  | $ | 61.07 |
Schedule of Stock Options Valuation Assumptions | The Company uses the Black-Scholes option-pricing model to calculate the fair value of stock options granted. During the year ended December 31, 2016, no stock options were granted. The assumptions used in the Black-Scholes option-pricing model for the years ended December 31, 2018, 2017 and 2016 are set forth in the following table. Expected volatility is based on the unbiased standard deviation of Tempur Sealy International’s common stock over the option term. The expected life of the options represents the period of time that the Company expects the options granted to be outstanding. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of the grant of the option for the expected term of the instrument. The dividend yield reflects an estimate of dividend payouts over the term of the award. During 2017, the Company adopted a change in accounting policy to recognize forfeitures of awards as they occur instead of estimating potential forfeitures. Historically, the Company estimated the number of awards expected to be forfeited and adjusted the estimate when it was no longer probable that employees would fulfill their service conditions. The Company uses historical data to determine these assumptions.
| Year Ended December 31,
| 2018 |  | 2017 |  | 2016
Expected volatility range of stock | 39.8% - 40.1% |  | 37.4% - 40.8% |  | N/A
Expected life of option, range in years | 5 |  | 5 |  | N/A
Risk-free interest range rate | 2.2% - 2.8% |  | 1.8% - 1.9% |  | N/A
Expected dividend yield on stock | —% |  | —% |  | N/A
Schedule of Stock Option Activity | A summary of the Company’s unvested shares relating to stock options as of December 31, 2018 and 2017, and changes during the years ended December 31, 2018 and 2017, are presented below:
(shares in millions) | Shares |  | Weighted Average Grant Date Fair Value
Options unvested at December 31, 2016 | 0.5 |  |  | $ | 63.09 |
Granted | 0.6 |  |  | 69.04 |
Vested | (0.3 | ) |  | 61.69 |
Forfeited | (0.1 | ) |  | 67.45 |
Options unvested at December 31, 2017 | 0.7 |  |  | $ | 67.95 |
Granted | 0.3 |  |  | 61.84 |
Vested | (0.2 | ) |  | 66.72 |
Forfeited | (0.2 | ) |  | 60.45 |
Options unvested at December 31, 2018 | 0.6 |  |  | $ | 66.20 |
A summary of the Company’s stock option activity under the 2003 Plan and 2013 Plan for the years ended December 31, 2018 and 2017 is presented below:
(in millions, except per share amounts and years) | Shares |  | Weighted Average Exercise Price |  | Weighted Average Remaining Contractual Term (Years) |  | Aggregate Intrinsic Value
Options outstanding at December 31, 2016 | 1.5 |  |  | $ | 50.46 |  |  |  |  |
Granted | 0.6 |  |  | 69.04 |  |  |  |  |
Exercised | (0.3 | ) |  | 38.44 |  |  |  |  |
Forfeited | (0.1 | ) |  | 67.45 |  |  |  |  |
Options outstanding at December 31, 2017 | 1.7 |  |  | $ | 58.93 |  |  |  |  |
Granted | 0.3 |  |  | 61.84 |  |  |  |  |
Exercised | (0.2 | ) |  | 28.20 |  |  |  |  |
Forfeited | (0.2 | ) |  | 60.45 |  |  |  |  |
Options outstanding at December 31, 2018 | 1.6 |  |  | $ | 62.51 |  |  | 6.91 |  | —
Options exercisable at December 31, 2018 | 1.0 |  |  | $ | 59.93 |  |  | 5.87 |  | —
Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity | A summary of the Company's RSU and DSU activity and related information for the years ended December 31, 2018 and 2017 is presented below:
(in millions, except per share amounts) | Shares |  | Weighted Average Release Price |  | Aggregate Intrinsic Value
Awards outstanding at December 31, 2016 | 0.4 |  |  | $ | 59.37 |  |  |
Granted | 0.4 |  |  | 68.08 |  |  |
Vested | (0.1 | ) |  | 54.20 |  |  |
Terminated | (0.1 | ) |  | 64.66 |  |  |
Awards outstanding at December 31, 2017 | 0.6 |  |  | $ | 64.94 |  |  |
Granted | 0.3 |  |  | 61.29 |  |  |
Vested | (0.1 | ) |  | 62.85 |  |  |
Terminated | — |  |  | 64.00 |  |  |
Awards outstanding at December 31, 2018 | 0.8 |  |  | $ | 63.82 |  |  | $ | 34.6 |
Schedule of Unrecognized Compensation Expense | Excluding any potential compensation expense related to the 2017 Aspirational Plan PRSUs and 2019 Aspirational Plan PRSUs discussed above, a summary of total unrecognized stock-based compensation expense based on current performance estimates related to stock options, DSUs, RSUs and PRSUs for the year ended December 31, 2018 is presented below:
(in millions, except years) | December 31, 2018 |  | Weighted Average Remaining Vesting Period (Years)
Unrecognized stock option expense | $ | 11.5 |  |  | 2.42
Unrecognized DSU/RSU expense | 29.6 |  |  | 2.46
Unrecognized PRSU expense | 3.4 |  |  | 2.65
Total unrecognized stock-based compensation expense | $ | 44.5 |  |  | 2.46

X
- References No definition available. + Details
Name: | us-gaap_DisclosureOfCompensationRelatedCostsSharebasedPaymentsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition Tabular disclosure of the amount of total share-based compensation cost, including the amounts attributable to each share-based compensation plan and any related tax benefits. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (h)(1) -URI http://asc.fasb.org/extlink&oid=109197908&loc=d3e5070-113901 + Details
Name: | us-gaap_ScheduleOfCompensationCostForShareBasedPaymentArrangementsAllocationOfShareBasedCompensationCostsByPlanTableTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition Tabular disclosure of the changes in outstanding nonvested performance-based units. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (c)(2) -URI http://asc.fasb.org/extlink&oid=109197908&loc=d3e5070-113901 + Details
Name: | us-gaap_ScheduleOfNonvestedPerformanceBasedUnitsActivityTableTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition Tabular disclosure for stock option plans. Includes, but is not limited to, outstanding awards at beginning and end of year, grants, exercises, forfeitures, and weighted-average grant date fair value. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=109197908&loc=d3e5070-113901 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (e) -URI http://asc.fasb.org/extlink&oid=109197908&loc=d3e5070-113901 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (c)(1) -URI http://asc.fasb.org/extlink&oid=109197908&loc=d3e5070-113901 + Details
Name: | us-gaap_ScheduleOfShareBasedCompensationStockOptionsActivityTableTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition Tabular disclosure of the significant assumptions used during the year to estimate the fair value of stock options, including, but not limited to: (a) expected term of share options and similar instruments, (b) expected volatility of the entity's shares, (c) expected dividends, (d) risk-free rate(s), and (e) discount for post-vesting restrictions. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (f)(2) -URI http://asc.fasb.org/extlink&oid=109197908&loc=d3e5070-113901 + Details
Name: | us-gaap_ScheduleOfShareBasedPaymentAwardStockOptionsValuationAssumptionsTableTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition Disclosure of the number and weighted-average grant date fair value for restricted stock and restricted stock units that were outstanding at the beginning and end of the year, and the number of restricted stock and restricted stock units that were granted, vested, or forfeited during the year. + References No definition available. + Details
Name: | us-gaap_ScheduleOfSharebasedCompensationRestrictedStockAndRestrictedStockUnitsActivityTableTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition Tabular disclosure of the total compensation cost related to nonvested awards not yet recognized and the weighted-average period over which it is expected to be recognized. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (i) -URI http://asc.fasb.org/extlink&oid=109197908&loc=d3e5070-113901 + Details
Name: | us-gaap_ScheduleOfUnrecognizedCompensationCostNonvestedAwardsTableTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration