XML 41 R9.htm IDEA: XBRL DOCUMENT
v2.4.0.8

Share-based Payment Arrangements | 6 Months Ended
--- | ---
Jun. 29, 2013
Share-based Payment Arrangements |
(1) | Share-based Payment Arrangements
As of June 29, 2013, the Company had two employee equity incentive plans, the 2002 employee stock option and stock incentive plan (the “ESOSIP”) and the 2011 equity incentive plan (the “2011 EIP”). No further grants can be made under the ESOSIP. The Company also has two stock compensation plans for members of its Board of Directors, the 2003 Directors Stock Compensation Plan (the “2003 DSCP”) and the 2013 Directors Stock Compensation Plan (the “2013 DSCP”). In May 2013, the Company’s stockholders approved the 2013 DSCP. The provisions of the 2013 DSCP are substantially similar to the provisions of the 2003 DSCP. 115,000 shares of the Company’s common stock were authorized for issuance under the 2013 DSCP. No further grants can be made under the 2003 DSCP, including 113,704 shares of the Company’s common stock previously reserved for issuance, but not issued, under the 2003 DSCP. The ESOSIP, 2011 EIP, 2003 DSCP and 2013 DSCP are each referred to herein as a “Plan,” and, collectively, as the “Plans.” Amounts recognized in the financial statements with respect to these Plans are as follows (in thousands):
|  | Twenty Six Weeks Ended |  |  | Thirteen Weeks Ended |
|  | June 29, 2013 |  |  | June 30, 2012 |  |  | June 29, 2013 |  |  | June 30, 2012 |
Total cost of the Plans during the period |  | $ | 2,992 |  |  | $ | 3,186 |  |  | $ | 1,374 |  |  | $ | 1,661 |
Amount of related income tax benefit recognized during the period |  |  | 979 |  |  |  | 1,332 |  |  |  | 282 |  |  |  | 379 |
Net cost of the Plans during the period |  | $ | 2,013 |  |  | $ | 1,854 |  |  | $ | 1,092 |  |  | $ | 1,282 |
Included in income tax benefits recognized in the twenty-six-week periods ended June 29, 2013 and June 30, 2012 were income tax benefits of $417,000 and $745,000, respectively, recognized on disqualifying dispositions of the Company’s common stock by employees who obtained shares of common stock through exercises of incentive stock options. As of June 29, 2013, there were 102,655 shares of the Company’s common stock reserved for issuance under the 2013 DSCP and 6,740,433 shares of the Company’s common stock reserved for issuance in the aggregate under the ESOSIP and 2011 EIP. Stock Options The fair value of each option grant on its grant date was calculated using the Black-Scholes option pricing model with the following weighted average assumptions for grants made in the 2013 and 2012 twenty-six-week periods:
|  | 2013 |  |  | 2012 |
Expected volatility |  |  | 32.0 | % |  |  | 34.0 | %
Expected dividend yield |  |  | 0.410 | % |  |  | 0.420 | %
Risk-free interest rate |  |  | 0.75 | % |  |  | 0.90 | %
Expected lives (in years) |  |  | 4.0 |  |  |  | 4.0 |
The Company utilizes historical data, including exercise patterns and employee departure behavior, in estimating the term that options will be outstanding. Expected volatility was based on historical volatility and other factors, such as expected changes in volatility arising from planned changes to the Company’s business, if any. The risk-free interest rate was based on the yield of zero coupon U.S. Treasury bonds for terms that approximated the terms of the options granted. The weighted average grant date fair value of stock options granted during the twenty-six-week periods ended June 29, 2013 and June 30, 2012 was $14.21 per share and $13.99 per share, respectively. The following table summarizes information regarding the Company’s outstanding stock options under the Plans:
|  |  |  |  |  |  |  | Weighted Average |  |  |  |
|  | Number of |  |  | Weighted Average Exercise Price |  |  | Remaining Contractual |  |  | Aggregate Intrinsic |
|  | Options |  |  | per Share |  |  | Term (years) |  |  | Value (000s) |
Options outstanding at December 29, 2012 |  |  | 1,781,182 |  |  | $ | 42.56 |  |  |  |  |  |  |  |  |
Granted |  |  | 152,500 |  |  | $ | 56.40 |  |  |  |  |  |  |  |  |
Exercised |  |  | (371,570 | ) |  | $ | 40.58 |  |  |  |  |  |  |  |  |
Forfeited |  |  | (37,400 | ) |  | $ | 40.44 |  |  |  |  |  |  |  |  |
Options outstanding at June 29, 2013 |  |  | 1,524,712 |  |  | $ | 44.48 |  |  |  | 6.5 |  |  | $ | 10,703 |
Options exercisable at June 29, 2013 |  |  | 744,212 |  |  | $ | 42.13 |  |  |  | 4.6 |  |  | $ | 6,971 |
The total intrinsic value of stock options exercised during the twenty-six-week periods ended June 29, 2013 and June 30, 2012 was $5,305,000 and $12,296,000, respectively. As of June 29, 2013, there was $6,918,000 of total unrecognized compensation cost related to non-vested stock options granted under the Plans. The unrecognized compensation cost related to these non-vested options is expected to be recognized over a weighted average period of 3.3 years. Non-vested Restricted Stock The fair value of each share of non-vested restricted stock issued under the Plans is based on the fair value of a share of the Company’s common stock on the date of grant. The following table summarizes information regarding the Company’s outstanding non-vested restricted stock under the Plans:
|  | Number of |  |  | Weighted Average Grant Date |
|  | Shares |  |  | Fair Value |
Outstanding at December 29, 2012 |  |  | 34,719 |  |  | $ | 42.75 |
Granted |  |  | 13,449 |  |  | $ | 54.56 |
Vested |  |  | (11,975 | ) |  | $ | 45.61 |
Outstanding at June 29, 2013 |  |  | 36,193 |  |  | $ | 46.19 |
As of June 29, 2013, there was $1,207,000 of total unrecognized compensation cost related to non-vested shares of restricted stock granted under the Plans. The unrecognized compensation cost related to these non-vested shares of restricted stock is expected to be recognized over a weighted average period of 2.4 years. Restricted Stock Units The fair value of a restricted stock unit (“RSU”) is determined based on the market value of the Company’s common stock on the date of grant, discounted for lack of marketability for a minimum post-vesting holding requirement. The discount rate due to lack of marketability used for RSU award grants during both twenty-six-week periods ended June 29, 2013 and June 30, 2012 was 7%. The following table summarizes information regarding the Company’s outstanding RSU awards under the Plans:
|  | Number of |  |  | Weighted Average Grant Date |
|  | Units |  |  | Fair Value |
Outstanding at December 29, 2012 |  |  | 113,000 |  |  | $ | 44.78 |
Granted |  |  | 244,500 |  |  | $ | 51.19 |
Vested |  |  | (21,901 | ) |  | $ | 44.78 |
Forfeited |  |  | (7,046 | ) |  | $ | 45.45 |
Outstanding at June 29, 2013 |  |  | 328,553 |  |  | $ | 49.54 |
The Company reports compensation expense over the life of the award based on an estimated number of shares that will vest over the life of the award, multiplied by the fair value of an RSU. RSU awards have contractual lives of three or five years from the date of grant. For RSUs with five-year contractual lives, the number of RSUs that vest is determined annually, for each year in the five-year period from date of grant, by multiplying the number of RSUs granted by the sum of (a) the average of the percentage change (positive or negative) in operating income and diluted earnings per share in each of the 5 years as compared to operating income and diluted earnings per share reported in the base year (base year being the year immediately preceding the year in which the RSUs were granted), plus (b) 5%, rounded to the nearest whole number, less (c) the number of RSUs from that grant that have previously vested. On January 23, 2013, the Company granted 100,000 RSUs to the Company’s Chairman, President and Chief Executive Officer. These 100,000 RSUs have three-year contractual lives and will vest on January 31 of 2014, 2015, and 2016, with the number of RSUs that vest on each vesting date determined by multiplying 100,000 by the sum of (1) the percentage increase in operating income in the most recently completed fiscal year as compared to the results from the immediately preceding fiscal year, plus (2) the percentage increase in diluted earnings per share in the most recently completed fiscal year as compared to the results from the preceding fiscal year. The Company recognized approximately $1,044,000 and $430,000 of share-based compensation expense related to RSU awards in the twenty-six-week periods ended June 29, 2013 and June 30, 2012, respectively. As of June 29, 2013, there was a maximum of $15.2 million of total unrecognized compensation cost related to RSU awards granted under the Plans with an expected average remaining life of approximately 3.7 years. The amount of future compensation expense to be recognized will be determined based on actual future operating results.

X
- Definition The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5047-113901 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5070-113901 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 50 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6406099&loc=d3e25284-112666 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 40 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6418621&loc=d3e17540-113929 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5444-113901 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Staff Accounting Bulletin (SAB) -Number Topic 14 + Details
Name: | us-gaap_DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration