Callaway 2013 Annual Report Download - page 104

Download and view the complete annual report

Please find page 104 of the 2013 Callaway annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 114

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114

F-34
based on changes in fair value. Fair value is remeasured at the end of each interim reporting period based on the closing
price of the Company’s stock. PSUs vest at the end of a three year period.
The weighted average grant-date fair value per share of PSUs granted to employees during the years ended
December 31, 2012 and 2011 was $6.37 and $7.51, respectively. The Company did not grant PSUs in 2013.
The table below is a roll-forward of the activity for phantom stock units during the 12 months ended December 31,
2013 (in thousands, except fair value amounts):
Phantom Stock Units Units
Weighted-
Average
Grant-Date
Fair Value
Nonvested at January 1, 2013........................................................................................................... 508 $ 6.77
Granted ............................................................................................................................................. — —
Vested................................................................................................................................................ (17) 7.51
Forfeited............................................................................................................................................ (47) 7.04
Nonvested at December 31, 2013..................................................................................................... 444 $ 6.72
In connection with these awards, the Company recognized compensation expense of $1,635,000, $1,724,000 and
$2,095,000 for the years ended December 31, 2013, 2012 and 2011, respectively. At December 31, 2013, the Company
accrued compensation expense of $2,830,000 of which $1,439,000 was included in accrued employee compensation and
benefits and $1,391,000 was included in long-term incentive compensation and other in the accompanying consolidated
balance sheet. Accrued compensation expense for PSUs was $1,324,000 at December 31, 2012, which was included in
long-term incentive compensation and other in the accompanying consolidated balance sheets.
Stock Appreciation Rights
The Company records compensation expense for SARs based on the estimated fair value on the date of grant using
the Black Scholes option-pricing model. SARs are subsequently remeasured at each interim reporting period based on a
revised Black Scholes value until they are exercised. SARs vest over a three year period. As of December 31, 2013, 2012
and 2011, the Company recognized $3,016,000, $2,285,000 and $321,000, respectively, in compensation expense related
to these awards. At December 31, 2013 and 2012, the Company accrued compensation expense of $5,193,000 and
$2,607,000, respectively, of which $4,200,000 and $1,819,000 was included in accrued employee compensation and
benefits, respectively, and $993,000 and $788,000 was included in long-term incentive compensation and other,
respectively, in the accompanying consolidated balance sheets.
The table below summarizes the total number of SARs granted to employees during the year ended December 31,
2013 (in thousands):
Stock Appreciation Rights Units
Weighted-
Average
Exercise Price
Per Share
Nonvested at January 1, 2013....................................................................................................... 2,995 $ 6.42
Granted ......................................................................................................................................... — —
Vested............................................................................................................................................ (380) 6.48
Forfeited........................................................................................................................................ (140) 6.69
Nonvested at December 31, 2013................................................................................................. 2,475 $ 6.39
Employee Stock Purchase Plan
The Company offered an employee stock purchase program in which participating employees authorized the
Company to withhold compensation and use the withheld amounts to purchase shares of the Company’s common stock
at 85% of the closing price on the last day of each six-month offering period. In 2011, the Company terminated this
program. In 2011, the Company purchased approximately 376,000 shares of common stock under this program on behalf
of participating employees and recorded compensation expense of $234,000.