XML 83 R23.htm IDEA: XBRL DOCUMENT
v2.4.0.8

SHARE-BASED COMPENSATION PLANS | 12 Months Ended
--- | ---
Feb. 28, 2014
SHARE-BASED COMPENSATION PLANS |
SHARE-BASED COMPENSATION PLANS | NOTE 15 – SHARE-BASED COMPENSATION PLANS We have equity awards outstanding under two expired share-based compensation plans. The expired plans consist of an employee stock option and restricted stock plan adopted in 1998 (the “1998 Plan”) and a non-employee director stock option plan adopted in 1995 (the “1995 Directors’ Plan”). We also have equity awards outstanding under three active share-based compensation plans. The plans consist of the Helen of Troy Limited 2008 Stock Incentive Plan, an employee stock option and restricted stock plan (the “2008 Stock Incentive Plan”), the Helen of Troy Limited 2008 Non-Employee Directors Stock Incentive Plan, a non-employee director restricted stock plan (the “2008 Directors’ Plan”), and the Helen of Troy Limited 2008 Employee Stock Purchase Plan (the “2008 Stock Purchase Plan”). These plans are described below. The plans are administered by the Compensation Committee of the Board of Directors, which consists of non-employee directors who are independent under the NASDAQ Stock Market listing standards. Expired Plans The 1998 Plan - The plan covered a total of 6,750,000 shares of common stock for issuance to key officers and employees. The 1998 Plan provided for the grant of options to purchase our common stock at a price equal to or greater than the fair market value on the grant date. The 1998 Plan contained provisions for incentive stock options, non-qualified stock options and restricted share grants. Generally, options granted under the 1998 Plan become exercisable immediately or over one-, four-, or five-year vesting periods and expire on dates ranging from seven to ten years from the date of grant. The 1998 Plan expired by its terms on August 25, 2008. As of February 28, 2014, 30,100 shares of common stock subject to options were outstanding under the plan. The 1995 Directors’ Plan - The plan covered a total of 980,000 shares of common stock for issuance to non-employee members of the Board of Directors. We granted options under the 1995 Directors’ Plan at a price equal to the fair market value of our common stock at the date of grant. Options granted under the 1995 Directors’ Plan vest one year from the date of issuance and expire ten years after issuance. The 1995 Directors’ Plan expired by its terms on June 6, 2005. As of February 28, 2014, options to purchase 20,000 shares of common stock were outstanding under the plan. Active Plans The 2008 Stock Incentive Plan - The plan covers a total of 3,750,000 shares of common stock for issuance to key officers, employees and consultants of the Company. Generally, options granted under the 2008 Stock Incentive Plan will become exercisable over four- or five-year vesting periods and will expire on dates ranging from seven to ten years from the date of grant. The plan will expire by its terms on August 19, 2018. As of February 28, 2014, 788,831 shares of common stock subject to options were outstanding, 100,000 Performance RSUs remained outstanding but were vested on April 22, 2014 and 2,350,699 shares remained available for future issue under the plan. On March 1, 2012, our former CEO was granted 700,000 Performance RSUs with a fair value of $32.88 per share subject to performance and service conditions. 100,000 Performance RSUs were earned in fiscal year 2013 and were vested and settled in fiscal year 2014 in accordance with the terms of his Employment and Separation Agreements. Based on the achievement of performance targets in connection with his fiscal year 2013 annual bonus, the former CEO was also awarded 159,666 RSAs having a fair value at the date of the award of $35.55 per share. These shares were awarded on April 22, 2013 and vested on February 28, 2014 in accordance with the terms of his Employment and Separation Agreements. Our former CEO earned 100,000 Performance RSUs and 62,304 RSAs for fiscal year 2014 performance having a fair value at the date of the award of $67.10 per share. These Performance RSUs and RSAs vested on April 22, 2014 per the terms of his Employment and Separation Agreements. For further information regarding the Separation Agreement, see Note (13) to these consolidated financial statements under the subheading “Employment Contracts.” The 2008 Directors’ Plan - The plan covers a total of 175,000 shares of common stock for issuance of restricted stock, restricted stock units or other stock-based awards to non-employee members of our Board of Directors. Awards granted under the 2008 Directors’ Plan will be subject to vesting schedules and other terms and conditions as determined by the Compensation Committee of the Company’s Board of Directors. Currently, the Board’s stock ownership guidelines require restricted stock granted to directors to be held until their departure from the Board. The plan will expire by its terms on August 19, 2018. As of February 28, 2014, 58,624 shares of restricted stock have been granted and 116,376 shares remained available for future issue under the plan. Under the 2008 Directors’ Plan, for the fiscal years ended 2014, 2013 and 2012, the Company granted 10,512, 10,512 and 18,000 shares of restricted stock, respectively, to certain members of our Board of Directors having weighted average fair values at the date of grant of $41.26, $31.54 and $29.48 per share for each year, respectively. The restricted stock awards vested immediately, were valued at the fair value of the Company’s common stock at the date of the grant and accordingly, were expensed at the time of the grants. The 2008 Stock Purchase Plan - The plan covers a total of 350,000 shares of common stock for issuance to our employees. Under the terms of the plan, employees may authorize the withholding of up to 15 percent of their wages or salaries to purchase our shares of common stock. The purchase price for shares acquired under the 2008 Stock Purchase Plan is equal to the lower of 85 percent of the share’s fair market value on either the first day of each option period or the last day of each period. The plan will expire by its terms on September 1, 2018. Shares of common stock purchased under the 2008 Stock Purchase Plan vest immediately at the time of purchase. Accordingly, the fair value award associated with their discounted purchase price is expensed at the time of purchase. During fiscal years 2014, 2013 and 2012, plan participants acquired a total of 41,328, 39,728 and 41,868 shares of common stock at average prices of $32.66, $26.68 and $24.17 per share, respectively. As of February 28, 2014, 158,213 shares remained available for future issue under this plan. The Company recorded share-based compensation expense in SG&A for each of the fiscal years covered by our consolidated statements of income as follows: SHARE-BASED PAYMENT EXPENSE (in thousands, except per share data)
|  | Fiscal Years Ended the Last Day of February, |
|  | 2014 |  | 2013 |  | 2012 |
Stock options |  | $ | 2,380 |  | $ | 2,298 |  | $ | 2,061 |
Directors stock compensation |  |  | 619 |  | 473 |  | 531 |
Performance based restricted stock awards (1) |  |  | 7,968 |  | 2,988 |  | - |
Performance based restricted stock units (2) |  |  | 5,478 |  | - |  | - |
CEO separation compensation (3) |  |  | 15,000 |  | - |  | - |
Employee stock purchase plan |  |  | 424 |  | 296 |  | 336 |
Share-based payment expense |  |  | 31,869 |  | 6,055 |  | 2,928 |
Less income tax benefits |  |  | (5,709) |  | (858) |  | (99) |
Share-based payment expense, net of income tax benefits |  | $ | 26,160 |  | $ | 5,197 |  | $ | 2,829 |
Earnings per share impact of share based payment expense: |  |  |  |  |  |  |  |
Basic |  | $ | 0.82 |  | $ | 0.16 |  | $ | 0.09 |
Diluted |  | $ | 0.81 |  | $ | 0.16 |  | $ | 0.09 |
The table above includes the following awards recognized in accordance with the terms of our former CEO’s Employment and Separation Agreements: (1) RSAs of 159,666 for fiscal year 2013 with a fair value at the date of the award of $35.55 per share, vested and settled on February 28, 2014, and 62,304 RSAs for fiscal year 2014 with a fair value at the date of the award of $67.10 per share, vested on April 22, 2014. (2) Performance RSUs of 66,600 for fiscal year 2013 and 100,000 for fiscal year 2014, having a fair value at the date of each grant of $32.88. (3) $15 million in aggregate fair value of shares of common stock, to be settled on September 1, 2014 per the terms of the Separation Agreement with our former CEO. The fair value of all share-based payment awards are estimated using a Black-Scholes option pricing model with the following assumptions for the fiscal years 2014, 2013 and 2012: ASSUMPTIONS USED FOR FAIR VALUE OF STOCK OPTION GRANTS
|  | Fiscal Years Ended the Last Day of February, |
|  | 2014 |  | 2013 |  | 2012 |
Range of risk free interest rates used |  | 0.6% - 1.3% |  | 0.1% - 0.9% |  | 0.6% - 1.5% |
Expected dividend rate |  | 0.0% |  | 0.0% |  | 0.0% |
Weighted average volatility rate |  | 38.8% |  | 51.4% |  | 52.5% |
Range of expected volatility rates used |  | 34.0% - 41.7% |  | 45.7% - 55.3% |  | 51.4% - 65.9% |
Range of expected terms used (in years) |  | 4.1 - 4.4 |  | 4.1 - 4.4 |  | 4.1 - 4.4 |
The following describes how certain assumptions above are determined and affect the estimated fair value of options or discounted employee share purchases (“share-based payments”). The risk-free interest rate is based on U.S. Treasury securities with maturities equal to the expected life of the share-based payments. The dividend yield is computed as zero because the Company has not historically paid dividends nor does it expect to do so at this time. Expected volatility is based on a weighted average of the market implied volatility and historical volatility over the expected life of the underlying share-based payments. The Company uses its historical experience to estimate the expected life of each stock-option grant and also to estimate the impact of exercise, forfeitures, termination, and holding period behavior for fair value expensing purposes. A summary of stock option activity under all the Company’s share-based compensation plans follows: SUMMARY OF STOCK OPTION ACTIVITY (in thousands, except contractual term and per share data)
|  |  |  |  |  |  |  | Weighted |  |  |
|  |  |  | Weighted |  | Weighted |  | Average |  |  |
|  |  |  | Average |  | Average |  | Remaining |  |  |
|  |  |  | Exercise |  | Grant Date |  | Contractual |  |  |
|  |  |  | Price |  | Fair Value |  | Term |  | Intrinsic |
|  | Options |  | (per share) |  | (per share) |  | (in years) |  | Value |
Outstanding at March 1, 2011 |  | 2,510 |  | $ | 17.64 |  | $ | 6.40 |  | 3.05 |  | $ | 26,054 |
Grants |  | 379 |  | 32.71 |  | 13.13 |  |  |  |  |
Exercises |  | (1,907 | ) | 16.10 |  | 36,912 |  |  |  |  |
Forfeitures / expirations |  | (111 | ) | 27.91 |  |  |  |  |  |  |
Outstanding at February 29, 2012 |  | 871 |  | 26.26 |  | 10.31 |  | 5.78 |  | 5,570 |
Grants |  | 309 |  | 34.57 |  | 14.09 |  |  |  |  |
Exercises |  | (248 | ) | 22.88 |  | 2,634 |  |  |  |  |
Forfeitures / expirations |  | (68 | ) | 30.23 |  |  |  |  |  |  |
Outstanding at February 28, 2013 |  | 864 |  | 29.89 |  | 11.98 |  | 6.26 |  | 6,209 |
Grants |  | 264 |  | 36.45 |  | 11.61 |  |  |  |  |
Exercises |  | (239 | ) | 25.36 |  | 4,663 |  |  |  |  |
Forfeitures / expirations |  | (50 | ) | 33.55 |  |  |  |  |  |  |
Outstanding at February 28, 2014 |  | 839 |  | $ | 33.03 |  | $ | 12.38 |  | 6.48 |  | $ | 27,081 |
Exercisable at February 28, 2014 |  | 111 |  | $ | 25.85 |  | $ | 10.05 |  | 4.06 |  | $ | 4,389 |
A summary of non-vested stock option activity and changes under all the Company’s share-based compensation plans follows:
NON-VESTED STOCK OPTION ACTIVITY |  |  |  |  |
(in thousands, except per share data) |  |  |  |  |
|  |  |  | Weighted |
|  |  |  | Average |
|  |  |  | Grant Date |
|  | Non-Vested |  | Fair Value |
|  | Options |  | (per share) |
Outstanding at March 1, 2011 |  | 496 |  | $ | 8.42 |
Grants |  | 379 |  | 13.13 |
Vested or forfeited |  | (258 | ) | 9.19 |
Outstanding at February 29, 2012 |  | 617 |  | 10.99 |
Grants |  | 309 |  | 14.09 |
Vested or forfeited |  | (237 | ) | 10.29 |
Outstanding at February 28, 2013 |  | 689 |  | 12.62 |
Grants |  | 264 |  | 11.61 |
Vested or forfeited |  | (225 | ) | 11.06 |
Outstanding at February 28, 2014 |  | 728 |  | $ | 12.74 |
A summary of restricted stock unit activity and changes under the Company’s 2008 Stock Incentive Plan follows:
SUMMARY OF RESTRICTED STOCK UNIT ACTIVITY |  |  |  |  |  |  |
(in thousands, except per share data) |  |  |  |  |  |  |
|  |  |  | Weighted |  |  |
|  |  |  | Average |  |  |
|  | Restricted |  | Grant Date |  |  |
|  | Stock |  | Fair Value |  | Fair Value |
|  | Units |  | (per share) |  | Outstanding |
Outstanding at March 1, 2012 |  | - |  | $ | - |  | $ | - |
Granted |  | 700 |  | 32.88 |  |  |
Vested |  | - |  | - |  |  |
Outstanding at February 28, 2013 |  | 700 |  | 32.88 |  | 25,956 |
Vested (1) |  | (100 | ) | 32.88 |  |  |
Forfeited (2) |  | (500 | ) | 32.88 |  |  |
Outstanding at February 28, 2014 (3) |  | 100 |  | $ | 32.88 |  | $ | 6,531 |
The schedule above includes the following awards and forfeitures recognized in accordance with the terms of our former CEO’s Employment and Separation Agreements: (1) Includes 100,000 fiscal year 2013 Performance RSUs. 33,400 vested and settled on April 22, 2013 at a fair value of $35.55 per share and 66,600 vested and settled on February 28, 2014 at a fair value of $65.31 per share. (2) 500,000 Performance RSUs were forfeited. (3) Includes 100,000 fiscal year 2014 Performance RSUs, which were vested and settled on April 22, 2014 at a fair value of $67.10 per share. A summary of restricted stock award activity under all the Company’s share-based compensation plans follows:
SUMMARY OF RESTRICTED STOCK AWARD ACTIVITY |  |  |  |  |  |  |
(in thousands, except per share data) |  |  |  |  |  |  |
|  |  |  | Weighted |  |  |
|  |  |  | Average |  |  |
|  | Restricted |  | Grant Date |  |  |
|  | Stock |  | Fair Value |  | Fair Value |
|  | Awards |  | (per share) |  | Outstanding |
Due for issue at March 1, 2012 |  | - |  | $ | - |  | $ | - |
Earned (2) |  | 160 |  | 35.55 |  |  |
Vested and issued |  | - |  | - |  |  |
Due for Issue at February 28, 2013 (2) |  | 160 |  | $ | 35.55 |  | $ | 5,920 |
Earned (1) |  | 62 |  | 67.10 |  |  |
Vested and issued |  | (160 | ) | 35.55 |  |  |
Due for issue at February 28, 2014 (1) |  | 62 |  | $ | 67.10 |  | $ | 4,073 |
The schedule above includes the following awards earned based on fiscal years 2014 and 2013 performance and vested in accordance with the terms of our former CEO’s Employment and Separation Agreements: (1) Fiscal year 2014 RSAs, which vested on April 22, 2014. (2) Fiscal year 2013 RSAs, were vested on February 28, 2014. For further information regarding the former CEO’s Separation Agreement, see Note (13) to these consolidated financial statements under the subheading “Employment Contracts.” A summary of our total unrecognized share-based compensation expense as of February 28, 2014 is as follows: UNRECOGNIZED SHARE-BASED COMPENSATION EXPENSE (in thousands, except weighted average expense period data)
|  |  |  | Weighted |
|  |  |  | Average |
|  | Unrecognized |  | Period of |
|  | Compensation |  | Recognition |
|  | Expense |  | (in months) |
Stock options |  | $ | 6,127 |  | 30.9 |

X
- Details
Name: | us-gaap_DisclosureOfCompensationRelatedCostsSharebasedPaymentsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

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