Famous Footwear 2014 Annual Report Download - page 72

2014 BROWN SHOE COMPANY, INC. FORM 10-K 71
15. SHARE-BASED COMPENSATION
The Company has share-based incentive compensation plans under which certain ocers, employees and members of
the Board of Directors are participants and may be granted stock options, restricted stock and stock performance awards.
ASC 718, Compensation – Stock Compensation, and ASC 505, Equity, require companies to recognize compensation
expense in an amount equal to the fair value of all share-based payments granted to employees over the requisite
service period for each award. In certain limited circumstances, the Company’s incentive compensation plan provides
for accelerated vesting of the awards, such as in the event of a change in control, qualified retirement, death or
disability. The Company has a policy of issuing treasury shares in satisfaction of share-based awards.
Share-based compensation expense of $6.2 million, $5.6 million and $6.5 million was recognized in 2014, 2013 and
2012, respectively, as a component of selling and administrative expenses. The following table details the share-based
compensation expense by plan and the total related income tax benefit for 2014, 2013 and 2012:
($ thousands) 2014 2013 2012
(Income) expense for share-based compensation plans, net of forfeitures:
Stock options. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (46) $ 248 $ 215
Stock performance awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . – – 328
Restricted stock grants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,236 5,319 5,946
Total share-based compensation expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,190 5,567 6,489
Less: Income tax benefit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,397 2,136 2,507
Total share-based compensation expense, net of income tax benefit. . . . . . . . . . . . . . . . . . $ 3,793 $ 3,431 $ 3,982
In addition to the share-based compensation expense disclosed above, the Company also recognized cash-based expense
related to performance share units and cash awards granted under the performance share plans. The Company recognized
$6.6 million, $3.7 million and $1.8 million in 2014, 2013 and 2012, respectively, in expense for cash-based awards under the
performance share plans.
The Company issued 373,752, 481,916 and 925,676 shares of common stock in 2014, 2013 and 2012, respectively, for restricted
stock grants, stock options exercised and stock performance awards issued to employees and common and restricted stock
grants issued to directors. There were no significant modifications to any share-based awards in 2014, 2013 or 2012.
Restricted Stock
Under the Company’s incentive compensation plans, restricted stock of the Company may be granted at no cost to certain
ocers, key employees and directors. Plan participants are entitled to cash dividends and voting rights for their respective
shares. Restrictions limit the sale or transfer of these shares during the requisite service period, which generally ranges from
one to eight years. Expense for restricted stock grants is recognized on a straight-line basis separately for each vesting
portion of the stock award based upon fair value of the award on the date of grant. The fair value of the restricted stock
grants is the quoted market price for the Company’s common stock on the date of grant.
The following table summarizes restricted stock activity for the year ended January 31, 2015:
Number of Nonvested Weighted-Average
Restricted Shares Grant Date Fair Value
Nonvested at February 1, 2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,700,098 $13.25
Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 281,710 28.17
Vested. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (364,238) 14.21
Forfeited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (55,100) 15.89
Nonvested at January 31, 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,562,470 $15.61
For the years ended January 31, 2015, February 1, 2014 and February 2, 2013, restricted shares granted were 281,710,
411,735 and 759,400 respectively. Restricted shares forfeited during 2014, 2013 and 2012 were 55,100, 163,250, and 169,300,
respectively. The weighted-average fair value of restricted stock awards granted for the years ended January 31, 2015,
February 1, 2014 and February 2, 2013, was $28.17, $17.47 and $9.71, respectively. The total grant date fair value of restricted
stock awards vested during the years ended January 31, 2015, February 1, 2014 and February 2, 2013, was $5.2 million,
$4.1 million and $4.8 million, respectively. As of January 31, 2015, the total remaining unrecognized compensation cost
related to nonvested restricted stock grants amounted to $11.1 million, which will be amortized over the weighted-average
remaining requisite service period of 2.5 years.
The Company recognized $0.8 million, $2.9 million and $0.9 million in 2014, 2013 and 2012, respectively, of excess tax
benefits related to restricted stock vesting and dividends, which was reflected as an increase to additional paid-in capital.