Pier 1 2016 Annual Report Download - page 57

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
As of February 27, 2016 and February 28, 2015, outstanding options covering 232,974 and 305,700 shares were exercisable
under the 2006 Plan, respectively. Options were granted at exercise prices equal to the fair market value of the Company’s
common stock at the date of grant. Options issued under the 2006 Plan vest over a period of four years and have a term of ten
years from the grant date. The options will be fully vested upon death, disability or retirement of the associate. The 2006 Plan’s
administrative committee also has the discretion to take certain actions with respect to stock options, such as accelerating the
vesting, upon certain corporate changes (as defined in the 2006 Plan). Additionally, there were no outstanding options
exercisable under the Company’s previous stock plans at fiscal 2016 year end. For fiscal 2015 year end, outstanding options
totaling 170,000 shares were exercisable under the Company’s previous stock plans.
A summary of stock option transactions related to the Company’s stock option grants during the three fiscal years is as follows:
Exercisable Shares
Shares
Weighted
Average
Exercise
Price
Weighted
Average
Fair Value
at Date of
Grant Number of Shares
Weighted
Average
Exercise
Price
Outstanding at March 2, 2013 3,488,125 $11.05 3,468,275 $11.02
Options granted 13,248 23.19 $6.70
Options exercised (1,627,500) 12.90
Options cancelled or expired (16,000) 17.28
Outstanding at March 1, 2014 1,857,873 9.45 1,830,900 9.31
Options granted 11,300 17.78 4.25
Options exercised (187,625) 10.97
Options cancelled or expired (233,000) 17.09
Outstanding at February 28, 2015 1,448,548 8.09 1,419,712 7.86
Options granted 15,500 14.04 3.98
Options exercised (77,500) 7.46
Options cancelled or expired (176,000) 14.06
Outstanding at February 27, 2016 1,210,548 7.34 1,176,974 7.06
For options outstanding at February 27, 2016 Weighted
Average
Remaining
Contractual
Life
(in years)
Weighted
Average
Exercise Price-
Exercisable
SharesRanges of Exercise Prices Total Shares
Weighted
Average
Exercise
Price
Shares
Currently
Exercisable
$4.24 — $6.69 954,000 $ 6.66 1.00 954,000 $ 6.66
$7.45 — $11.47 204,600 7.73 1.33 204,600 7.73
$14.04 — $23.19 51,948 18.28 7.71 18,374 20.23
As of February 27, 2016, the weighted average remaining contractual term for outstanding and exercisable options was 1.3
years and 1.1 years, respectively. The aggregate intrinsic value was $5,300 for both outstanding and exercisable options at fiscal
2016 year end. The total intrinsic value of options exercised for fiscal years 2016, 2015 and 2014 was approximately $430,000,
$1,101,000 and $16,380,000, respectively. The intrinsic value of a stock option is the amount by which the market value of the
underlying stock exceeds the exercise price of the option.
At February 27, 2016, there was approximately $113,000 of total unrecognized compensation expense related to unvested
stock option awards, which is expected to be recognized over a weighted average period of 2.2 years. The fair value of the stock
options is amortized on a straight-line basis as compensation expense over the vesting periods of the options. The Company
recorded stock-based compensation expense related to stock options of approximately $87,000, $92,000 and $94,000 in fiscal
2016, 2015 and 2014, respectively.
Director deferred stock units — The 2015 Plan and certain prior plans authorize director deferred stock unit awards to non-
employee directors. During fiscal 2016, directors could elect to defer all or a portion of their director’s cash fees into a deferred
stock unit account. The annual retainer fees deferred (other than committee chairman and chairman of the board annual
PIER 1 IMPORTS, INC. 2016 Form 10-K 51