Coach 2012 Annual Report Download - page 64

COACH, INC.
Notes to Consolidated Financial Statements (Continued)
(dollars and shares in thousands, except per share data)
4. SHARE-BASED COMPENSATION − (continued)
Share Units
The grant-date fair value of each Coach share unit 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 2012, fiscal 2011 and fiscal
2010 was $62.71, $40.31, and $30.55, respectively. The following table summarizes information about non-
vested shares as of and for the year ended June 30, 2012:
Number of
Non-Vested
Shares
Weighted-Average
Grant-Date
Fair Value
Nonvested at July 2, 2011 .......................... 4,321 $33.81
Granted ..................................... 1,823 62.72
Vested ...................................... (1,649) 29.96
Forfeited .................................... (246) 38.97
Nonvested at June 30, 2012 ......................... 4,249 46.36
The total fair value of shares vested during fiscal 2012, fiscal 2011 and fiscal 2010 was $99,488, $58,359,
and $23,955, respectively. At June 30, 2012, $98,571 of total unrecognized compensation cost related to non-
vested share awards is expected to be recognized over a weighted-average period of 1.0 years.
Employee Stock Purchase Plan
Under the Employee Stock Purchase Plan, full-time Coach employees are permitted to purchase a limited
number of Coach common shares at 85% of market value. Under this plan, Coach sold 129, 120, and 176 new
shares to employees in fiscal 2012, fiscal 2011 and fiscal 2010, respectively. Compensation expense is
calculated for the fair value of employees’ purchase rights using the Black-Scholes model and the following
weighted-average assumptions:
Fiscal Year Ended
June 30,
2012
July 2,
2011
July 3,
2010
Expected term (years) ....................... 0.5 0.5 0.5
Expected volatility ......................... 45.6% 31.7% 57.6%
Risk-free interest rate ....................... 0.1% 0.2% 0.2%
Dividend yield ............................ 1.4% 1.3% 1.0%
The weighted-average fair value of the purchase rights granted during fiscal 2012, fiscal 2011 and fiscal
2010 was $17.31, $11.51, and $9.15, respectively.
Deferred Compensation
Under the Coach, Inc. Deferred Compensation Plan for Non-Employee Directors, Coach’s outside
directors may defer their director’s fees. Amounts deferred under these plans may, at the participants’ election,
be either represented by deferred stock units, which represent the right to receive shares of Coach common
stock on the distribution date elected by the participant, or placed in an interest-bearing account to be paid on
such distribution date. The amounts accrued under these plans at June 30, 2012 and July 2, 2011 were $2,664
and $2,688, respectively, and are included within total liabilities in the consolidated balance sheets.
5. LEASES
Coach leases certain office, distribution and retail facilities. The lease agreements, which expire at various
dates through 2028, are subject, in some cases, to renewal options and provide for the payment of taxes,
insurance and maintenance. Certain leases contain escalation clauses resulting from the pass-through of
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