Coach 2006 Annual Report Download - page 38
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The following table summarizes information about stock options under the Coach option plans at June 30, 2007:
$2.00 – 5.00 557 3.84 $ 4.09 557 $ 4.09
$5.01 – 10.00 891 5.15 6.39 891 6.39
$10.01 – 20.00 7,679 6.55 15.78 3,806 15.78
$20.01 – 30.00 7,293 8.01 29.30 1,589 27.81
$30.01 – 40.00 11,517 6.39 34.21 5,303 34.82
$40.01 – 50.00 1,349 5.16 46.26 163 42.30
$50.01 – 51.56 90 9.80 50.40 — —
29,376 6.70 $ 27.36 12,309 $ 24.67
The fair value of each Coach option grant is estimated on the date of grant using the Black-Scholes option pricing model and the
following weighted-average assumptions:
Expected term (years) 2.2 2.6 1.4
Expected volatility 29.9% 35.0% 29.2%
Risk-free interest rate 4.9% 4.2% 2.6%
Dividend yield —% —% —%
The expected term of options represents the period of time that the options granted are expected to be outstanding and is based on
historical experience. Expected volatility is based on historical volatility of the Company’s stock as well as the implied volatility from
publicly traded options on Coach’s stock. The risk free interest rate is based on the zero-coupon U.S. Treasury issue as of the date of the
grant. As Coach does not pay dividends, the dividend yield is 0%.
The weighted-average grant-date fair value of options granted during fiscal 2007, 2006 and 2005 was $7.12, $8.49 and $3.10,
respectively. The total intrinsic value of options exercised during fiscal 2007, 2006 and 2005 was $191,950, $232,507 and $201,232,
respectively. The total cash received from these option exercises was $112,119, $86,550 and $46,835 in fiscal 2007, 2006 and 2005,
respectively, and the actual tax benefit realized for the tax deductions from these option exercises was $69,496, $88,534 and $78,480,
respectively.
At June 30, 2007, $77,948 of total unrecognized compensation cost related to non-vested stock option awards is expected to be
recognized over a weighted-average period of 1.5 years.
49
Share Awards
The grant-date fair value of each Coach share award is equal to the fair value of Coach stock at the grant date. The weighted-average
grant-date fair value of shares granted during fiscal 2007, 2006 and 2005 was $35.09, $34.17 and $22.96, respectively. The following
table summarizes information about nonvested shares as of and for the year ended June 30, 2007:
Nonvested at July 1, 2006 1,329 $ 22.06
Granted 332 35.09
Vested (294) 17.30
Forfeited (41) 30.62
Nonvested at June 30, 2007 1,326 $ 26.10