Baskin Robbins 2011 Annual Report Download - page 108

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As share-based compensation expense recognized is based on awards ultimately expected to vest, it has been
reduced for annualized estimated forfeitures of 10-13%. Forfeitures are required to be estimated at the time of
grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Forfeitures
were estimated based on historical and forecasted turnover, and actual forfeitures have not had a material impact
on share-based compensation expense.
A summary of the status of the Company’s nonexecutive and 2011 Plan options as of December 31, 2011 and
changes during fiscal year 2011 is presented below:
Number of
shares
Weighted
average
exercise
price
Weighted
average
remaining
contractual
term (years)
Aggregate
intrinsic
value
(in millions)
Share options outstanding at December 25, 2010 ............. 360,107 $ 4.89 8.5
Granted .............................................. 343,191 23.34
Exercised ............................................ (38,674) 4.73
Forfeited or expired .................................... (16,867) 5.66
Share options outstanding at December 31, 2011 ............. 647,757 14.65 8.9 $6.7
Share options exercisable at December 31, 2011 ............. 105,885 4.86 6.7 2.1
Nonexecutive and 2011 Plan options granted during fiscal year 2011 consisted of the following:
Grant Date
Number of
awards
granted
Option
exercise price
Fair value of
underlying
common stock
3/9/2011 ................................ 21,891 $ 7.31 $ 7.31
7/26/2011 ............................... 28,600 $19.00 $19.00
12/12/2011 .............................. 160,000 $25.18 $25.18
12/21/2011 .............................. 132,700 $24.69 $24.69
Prior to the initial public offering, the fair value of the common stock underlying the options granted was
determined based on a contemporaneous valuation performed by an independent third-party valuation specialist
in accordance with the guidelines outlined in the American Institute of Certified Public Accountants Practice
Aid, Valuation of Privately-Held-Company Equity Securities Issued as Compensation. Subsequent to July 27,
2011, the fair value of the common stock underlying the options granted was determined based on the closing
price of the Company’s common stock on the NASDAQ Global Select Market on the date of grant.
As of December 31, 2011, there was $3.4 million of total unrecognized compensation cost related to
nonexecutive and 2011 Plan options. Unrecognized compensation cost is expected to be recognized over a
weighted average period of approximately 3.9 years.
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