Foot Locker 2014 Annual Report Download - page 89

FOOT LOCKER, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
20. Retirement Plans and Other Benefits − (continued)
Savings Plans
The Company has two qualified savings plans, a 401(k) Plan that is available to employees whose primary place
of employment is the U.S., and an 1165(e) Plan that is available to employees whose primary place of
employment is in Puerto Rico. Both plans limit participation to employees who have attained at least the age
of twenty-one and have completed one year of service consisting of at least 1,000 hours. As of January 1, 2015,
the savings plans allow eligible employees to contribute up to 40 percent of their compensation on a pre-tax
basis, subject to a maximum of $18,000 for the U.S. plan and $15,000 for the Puerto Rico plan of their
compensation on a pre-tax basis. The Company’s matching contribution is an amount equal to 25 percent of
employees’ pre-tax contributions up to 25 percent of the first 4 percent of the employees’ compensation
(subject to certain limitations). This matching contribution is made with Company stock and such matching
contributions are vested incrementally over the first 5 years of participation for both plans. The charge to
operations for the Company’s matching contribution was $3 million for all years presented.
21. Share-Based Compensation
Stock Awards
Under the Company’s 2007 Stock Incentive Plan (the ‘‘2007 Stock Plan’’), stock options, restricted stock,
restricted stock units, stock appreciation rights, or other stock-based awards may be granted to officers and
other employees of the Company, including its subsidiaries and operating divisions worldwide. Nonemployee
directors are also eligible to receive awards under this plan. Options for employees become exercisable in
substantially equal annual installments over a three-year period, beginning with the first anniversary of the date
of grant of the option, unless a shorter or longer duration is established at the time of the option grant. Options
for nonemployee directors become exercisable one year from the date of grant. The options terminate up to
ten years from the date of grant. On May 21, 2014, the 2007 Stock Plan was amended to increase the number
of shares of the Company’s common stock reserved for all awards to 14 million shares.
Employees Stock Purchase Plan
In 2013, the Company adopted the 2013 Foot Locker Employees Stock Purchase Plan (‘‘2013 ESPP’’), whose
terms are substantially the same as the 2003 Employees Stock Purchase Plan (‘‘2003 ESPP’’). No further shares
may be issued under the 2003 ESPP. Under the 2013 ESPP participating employees are able to contribute up to
10 percent of their annual compensation, not to exceed $25,000 in any plan year, through payroll deductions to
acquire shares of the Company’s common stock at 85 percent of the lower market price on one of two specified
dates in each plan year. Under the 2013 ESPP, 3,000,000 shares of common stock were available for purchase
beginning June 2014, of which 958 participating employees purchased 160,859 shares in 2014.
Share-Based Compensation Expense
Total compensation expense included in SG&A and the associated tax benefits recognized related to the
Company’s share-based compensation plans were as follows:
2014 2013 2012
(in millions)
Options and shares purchased under the employee stock purchase plan $13 $12 $10
Restricted stock and units 11 13 10
Total share-based compensation expense $24 $25 $20
Tax benefit $7 $8 $6
Tax deductions in excess of the cumulative compensation cost $12 $ 9 $11
66