Pier 1 2015 Annual Report Download - page 56

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
compensation expense related to restricted stock that may be recognized over a weighted average period of 2.0 years. The total
fair value of restricted stock awards vested was $7,098,000, $17,810,000 and $15,339,000 in fiscal 2015, 2014 and 2013,
respectively.
The Company realized a total tax benefit related to stock-based compensation of $5,856,000, $3,993,000 and $7,605,000
during fiscal years 2015, 2014 and 2013, respectively, of which $2,695,000, $2,265,000 and $4,814,000 were recorded as
excess tax benefits. See Note 7 of the Notes to Consolidated Financial Statements for additional discussion of income taxes.
Stock options — Under the CEO’s initial employment agreement effective February 19, 2007, the CEO received stock option
grants with a term of ten years from the grant date. As of February 28, 2015, outstanding options covering 944,000 shares were
exercisable. The options were granted as an employment inducement award and not under any equity incentive plan adopted by
the Company.
As of February 28, 2015 and March 1, 2014, outstanding options covering 305,700 and 405,400 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, outstanding options covering 170,000 and
481,500 shares were exercisable under the Company’s previous stock plans at fiscal years ended 2015 and 2014, respectively.
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 February 25, 2012 5,735,475 $12.16 5,620,525 $12.26
Options granted 11,900 18.80 $14.75
Options exercised (1,545,500) 11.08
Options cancelled or expired (713,750) 20.09
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
For options outstanding at February 28, 2015 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 1.99 954,000 $ 6.66
$7.45 — $11.27 286,500 7.63 2.29 286,500 7.63
$11.47 — $17.78 177,900 14.37 1.07 164,950 14.17
$18.49 — $23.19 30,148 20.68 6.34 14,262 19.71
As of February 28, 2015, the weighted average remaining contractual term for outstanding and exercisable options was 2.0
years and 1.9 years, respectively. The aggregate intrinsic value for outstanding and exercisable options was $6,420,000 and
$6,419,000, respectively, at fiscal 2015 year end. The total intrinsic value of options exercised for fiscal years 2015, 2014 and
2013 was approximately $1,101,000, $16,380,000 and $13,420,000, 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.
50 PIER 1 IMPORTS, INC. 2015 Form 10-K