Panera Bread 2006 Annual Report Download - page 63

net of a $2.3 million forfeiture estimate, and is expected to be recognized over a weighted average period of
approximately 2.7 years.
The fair value of restricted stock is determined based on the market value of the Company’s stock on the grant
date. A summary of the status of the Company’s restricted stock activity is set forth below:
Restricted
Stock
Weighted
Average
Grant-Date
Fair Value
(in thousands)
Non-vested at December 25, 2004 ............................. — $ —
Granted ............................................... 94 52.89
Vested ................................................ —
Forfeited .............................................. (2) 54.06
Non-vested at December 27, 2005 ............................. 92 52.88
Granted ............................................... 170 51.59
Vested ................................................ — —
Forfeited .............................................. (9) 51.32
Non-vested at December 26, 2006 ............................. 253 $52.07
As of December 26, 2006, there was $8.8 million of total unrecognized compensation cost related to restricted
stock, which is net of a $2.7 million forfeiture estimate, and is expected to be recognized over a weighted-average
period of approximately 4.3 years.
15. Defined Contribution Benefit Plan
The Panera Bread Company Savings Plan (the “Plan”) was formed under Section 401(k) of the Code. The Plan
covers substantially all employees who meet certain service requirements. Participating employees may elect to
defer on a pre-tax basis up to 15% of his or her salary, subject to the limitations imposed by the Code. The Plan
provides for a matching contribution by the Company equal to 50% of the first 3% of the participant’s eligible pay.
All employee contributions vest immediately. Company matching contributions vest beginning in the second year
of employment at 25% per year, and are fully vested after 5 years. The Company contributed $0.7 million,
$0.5 million and $0.3 million to the Plan in 2006, 2005, and 2004, respectively.
16. Other Income and Expense
Other (income) expense, net was ($2.0) million, ($1.1) million, and $1.1 million in 2006, 2005, and 2004,
respectively. Other income, net in 2006 primarily consisted of interest income of $3.5 million, partially offset by
$1.5 million of charges associated with the termination of ADA’s with two franchisees in the Phoenix markets, none
of which had operating bakery-cafes. The termination of the ADA’s was precipitated by the pending acquisition of
Paradise Bakery and Café (“Paradise”), which closed in the first quarter of 2007 (see Note 20 for further description
of the Paradise transaction). Included in the $1.5 million of charges was $0.8 million of asset write-offs from assets
acquired from one of the franchisees, $0.3 million of future operating lease costs resulting from the assumption of
certain leases from one of the franchisees, and $0.4 million of other costs involved with termination of the ADA’s.
Other income, net in 2005 principally consisted of interest income of $2.5 million, partially offset by costs of
$1.4 million. Other expense, net in 2004 principally consisted of minority interest allocation, payments to our
former joint venture partner, and other costs of $2.0 million, partially offset by interest income of $1.0 million.
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PANERA BREAD COMPANY
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS — (Continued)