Chili's 2015 Annual Report Download - page 69

(b) Other Financial Instruments
Our financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable and
long-term debt. The fair values of cash and cash equivalents, accounts receivable and accounts payable
approximate their carrying amounts because of the short maturity of these items. The carrying amount of debt
outstanding related to the revolving credit facility approximates fair value as the interest rate on this instrument
approximates current market rates (Level 2). The fair values of the 2.60% notes and 3.88% notes are based on
quoted market prices and are considered Level 2 fair value measurements.
The carrying amounts and fair values of the 2.60% notes and 3.88% notes are as follows (in thousands):
June 24, 2015 June 25, 2014
Carrying Amount Fair Value Carrying Amount Fair Value
2.60% Notes .............. $249,899 $250,583 $249,864 $250,400
3.88% Notes .............. $299,766 $290,706 $299,736 $290,211
11. STOCK-BASED COMPENSATION
Our shareholders approved stock-based compensation plans including the Stock Option and Incentive Plan
and the Stock Option and Incentive Plan for Non-Employee Directors and Consultants (collectively, the “Plans”).
In November 2013, our shareholders approved an amendment to the Stock Option and Incentive Plan increasing
the number of shares authorized for issuance by 2.0 million shares. The total number of shares authorized for
issuance to employees and non-employee directors and consultants under the Plans is currently 37.3 million. The
Plans provide for grants of options to purchase our common stock, restricted stock, restricted stock units,
performance shares and stock appreciation rights.
(a) Stock Options
Expense related to stock options issued to eligible employees under the Plans is recognized using a graded-
vesting schedule over the vesting period or to the date on which retirement eligibility is achieved, if shorter.
Stock options generally vest over a period of 1 to 4 years and have contractual terms to exercise of 8 years. Full
or partial vesting of awards may occur upon a change in control (as defined in the Plans), or upon an employee’s
death, disability or involuntary termination.
Transactions during fiscal 2015 were as follows (in thousands, except option prices):
Number of
Options
Weighted
Average
Exercise
Price
Weighted
Average
Remaining
Contractual
Life (Years)
Aggregate
Intrinsic
Value
Options outstanding at June 25, 2014 ..... 1,701 $24.80
Granted ............................. 279 51.24
Exercised ........................... (765) 21.25
Forfeited or canceled .................. (42) 34.45
Options outstanding at June 24, 2015 ..... 1,173 $33.08 4.8 $28,849
Options exercisable at June 24, 2015 ...... 624 $24.06 3.4 $20,907
At June 24, 2015, unrecognized compensation expense related to stock options totaled approximately $2.5
million and will be recognized over a weighted average period of 1.8 years. The intrinsic value of options
exercised totaled approximately $28.1 million, $25.7 million and $22.4 million during fiscal 2015, 2014 and
2013, respectively. The tax benefit realized on options exercised totaled approximately $9.2 million, $8.9 million
and $8.1 million during fiscal 2015, 2014 and 2013, respectively.
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