Hasbro 2014 Annual Report Download - page 95

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HASBRO, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements — (Continued)
(Thousands of Dollars and Shares Except Per Share Data)
2014, 2013 and 2012, the Company recognized compensation expense, net of forfeitures, on these awards of
$15,643, $8,732 and $2,328, respectively. At December 28, 2014, the amount of total unrecognized
compensation cost related to restricted stock units is $34,146 and the weighted average period over which this
will be expensed is 29 months.
In October 2012, as part of an Amended and Restated Employment Agreement, the Company’s Chief
Executive Officer was awarded 587 shares to be granted in two tranches across 2013 and 2014. As of May 2013,
both tranches met the accounting definition for grant date and, as such, are being expensed from 2013 through
2017. Expenses related to 2014 and 2013 are included in the aforementioned recognized and unrecognized
compensation costs related to restricted stock units. 468 shares of this award are considered granted in 2013
while the remaining 119 shares were granted in February 2014. These awards provide the recipient with the
ability to earn shares of the Company’s common stock based on the Company’s achievement of four stated stock
price hurdles and continued employment through December 31, 2017. At the completion of the service period,
the recipient will receive one quarter of the award for each stock price hurdle achieved after April 24, 2013. The
four stock price hurdles are $45, $52, $56 and $60 which must be met for a period of at least thirty days using the
average closing price over such period. In August 2014, the Amended and Restated Employment Agreement was
further amended to include additional requirements. Specifically, if the third and fourth stock price hurdles are
achieved the number of shares ultimately issued will be dependent on the average stock price for the thirty day
period immediately prior to December 31, 2017. This amendment did not result in any incremental fair value to
the award which is used to record compensation expense for the award.
The Company used a Monte Carlo simulation valuation model to determine the fair value of these awards.
The following inputs were used in the simulation that resulted in an average grant date fair value for this award
of $35.56:
Inputs
Grant date stock price ......................................................... $47.28
Stock price volatility ......................................................... 26.12%
Risk-free interest rate ......................................................... 0.65%
Dividend yield .............................................................. 3.38%
Excluding the aforementioned award for 587 shares, information with respect to the remaining Restricted
Stock Awards and Restricted Stock Units for 2014, 2013 and 2012 is as follows:
2014 2013 2012
Outstanding at beginning of year ................................. 702 296 232
Granted ................................................... 281 451 92
Forfeited .................................................. (39) (44) (27)
Vested .................................................... (7) (1) (1)
Outstanding at end of year ...................................... 937 702 296
Weighted average grant-date fair value:
Granted ................................................... $52.06 45.16 36.01
Forfeited .................................................. $44.44 40.40 40.80
Vested .................................................... $41.19 33.62 32.90
Outstanding at end of year ...................................... $45.74 43.10 39.53
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