Popeye's 2015 Annual Report Download - page 76

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Popeyes Louisiana Kitchen, Inc.
Notes to Consolidated Financial Statements
For Fiscal Years 2015, 2014, and 2013 — (Continued)
(shares in thousands) Shares
Weighted
Average
Exercise Price
Weighted
Average
Remaining
Contractual
Term
(years)
Aggregate
Intrinsic
Value
(millions)
Stock options:
Outstanding at beginning of year 427 $ 20.35
Granted options 68 59.68
Exercised options (197) 12.68
Canceled and expired options (5) 50.24
Outstanding at end of year 293 $ 34.06 4.3 $ 7.2
Exercisable at end of year 164 $ 21.65 3.2 $ 6.0
The aggregate intrinsic value in the above table represents the total pre-tax intrinsic value (the difference between the
Company’s closing stock price on the last trading date of 2015 and the exercise price, multiplied by the number of options). The
amount of aggregate intrinsic value will change based on the fair market value of the Company’s common stock.
The Company recognized approximately $1.4 million, $1.1 million, and $0.9 million in stock-based compensation expense
associated with its stock option grants during 2015, 2014, and 2013, respectively. As of December 27, 2015, there was
approximately $1.2 million of total unrecognized compensation costs related to unvested stock options which are expected to
be recognized over a weighted average period of approximately 1.4 years. The total fair value at grant date of awards which
vested during 2015, 2014, and 2013 was $0.9 million, $0.9 million, and $0.8 million, respectively.
The weighted average grant date fair value of awards granted during 2015, 2014, and 2013 was $24.65, $17.93, and $15.11,
respectively. The total intrinsic value of stock options exercised during 2015, 2014, and 2013 was $9.0 million, $6.4 million and
$7.6 million, respectively
During 2015, 2014, and 2013, the fair value of option awards were estimated on the date of grant using a Black-Scholes
option-pricing model. The fair value of stock-based compensation is amortized on the graded vesting attribution method. The
following weighted average assumptions were used for the grants:
2015 2014 2013
Risk-free interest rate 1.4% 1.8% 0.7%
Expected dividend yield —% —% —%
Expected term (in years) 4.5 4.5 4.5
Expected volatility 48.8% 50.6% 53.0%
The risk-free interest rate is based on the United States treasury yields in effect at the time of grant. The expected term of
options represents the period of time that options granted are expected to be outstanding based on the vesting period, the term
of the option agreement and historical exercise patterns. The estimated volatility is based on the historical volatility of the
Company’s stock price.
The following table summarizes the non-vested stock option activity for the 52 week period ended December 27, 2015:
(shares in thousands) Shares
Weighted
Average
Grant Date Fair
Value
Unvested stock options outstanding at beginning of period 140 $ 15.37
Granted 68 24.65
Vested (74) 12.79
Canceled (5) 21.08
Unvested stock options outstanding at end of period 129 $ 21.49
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