WeightWatchers 2015 Annual Report Download - page 101

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WEIGHT WATCHERS INTERNATIONAL, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
Exchange on June 22, 2015. The replacement options vest over three years, with 25% vesting on each of the first
and second anniversaries of the date of grant and 50% vesting on the third anniversary of the date of grant. The
option exchange resulted in an incremental stock option expense of $1,599, which was determined by comparing
the fair value of the T&P Vesting Option as calculated based on a Monte Carlo simulation, to the fair value of the
replacement options, as calculated using the Black-Scholes option pricing model, for the eligible options at the
time of exchange. This incremental expense, along with the unamortized expense associated with the cancelled
options, is being recognized ratably over the new vesting period of the replacement options, which is three years.
Option Activity
A summary of all option activity under the Stock Plans and the Winfrey Option (see Note 3 for additional
disclosure regarding the Winfrey Option) for the year ended January 2, 2016 is presented below:
Shares
Weighted-
Average
Exercise
Price
Weighted-
Average
Remaining
Contractual
Life (Yrs.)
Aggregate
Intrinsic
Value
Outstanding at January 3, 2015 .............................. 3,250 $30.72
Granted ............................................. 4,572 6.61
Exercised ........................................... (4) 22.67
Exchanged .......................................... (1,700) 24.68
Cancelled ........................................... (788) 31.94
Outstanding at January 2, 2016 .............................. 5,330 $11.79 9.2 $73,260
Exercisable at January 2, 2016 ............................... 3,916 $10.62 9.3 $55,772
The weighted-average grant-date fair value of all options granted (including the Winfrey Option as
described in Note 3) was $4.86, $6.51, and $11.37 for the years ended January 2, 2016, January 3, 2015 and
December 28, 2013, respectively. The total intrinsic value of Time Vesting Options exercised was $17, $62, and
$9,858 for the years ended January 2, 2016, January 3, 2015 and December 28, 2013, respectively.
Cash received from Time Vesting Options exercised during the years ended January 2, 2016, January 3,
2015 and December 28, 2013 was $95, $658, and $16,187, respectively.
Restricted Stock Units Under Stock Plans
Pursuant to the restricted stock components of the Stock Plans, the Company’s Board of Directors
authorized the Company to enter into agreements under which certain employees received RSUs. The RSUs
are exercisable based on the terms outlined in the agreements. The RSUs vest over a period of three to five
years.
F-26