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SEAGATETECHNOLOGYPLC
NOTESTOCONSOLIDATEDFINANCIALSTATEMENTS—(Continued)
ThefairvalueoftheCompany'ssharesrelatedtooptionsgrantedtoemployees,sharesissuedfromtheESPPandperformanceawardssubjecttoTSR/ROIC
conditionsforfiscalyears2016,2015and2014wereestimatedusingthefollowingassumptions:
StockCompensationExpense
TheCompanyrecorded$120million,$137millionand$118millionofshare-basedcompensationduringfiscalyears2016,2015,and2014,respectively.
Managementhasmadeanestimateofexpectedforfeituresandisrecognizingcompensationcostsonlyforthoseequityawardsexpectedtovest.Whenestimating
forfeitures,theCompanyconsidersvoluntaryterminationbehavioraswellasanalysisofactualforfeitedawards.
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FiscalYears
2016 2015 2014
Options
Expectedterm(inyears) 2.1–4.2 4.2 4.2
Volatility 33–48% 33–35% 35–41%
Weighted-averagevolatility 36% 34% 40%
Expecteddividendrate 4.6–11.0% 2.9–4.0% 3.1–3.8%
Weighted-averageexpecteddividendrate 5.6% 3.0% 3.7%
Risk-freeinterestrate 0.6–1.5% 1.1–1.5% 1.2–1.4%
Weighted-averagefairvalue $12.28 $12.98 $10.41
ESPP
Expectedterm(inyears) 0.5 0.5 0.5
Volatility 28–46% 28–29% 34–36%
Weighted-averagevolatility 39% 28% 35%
Expecteddividendrate 4.6–8.3% 3.0–3.8% 3.3–3.5%
Weighted-averageexpecteddividendrate 6.9% 3.4% 3.4%
Risk-freeinterestrate 0.5% 0.1% 0.1%
Weighted-averagefairvalue $9.08 $12.21 $10.46
Performancerestrictedshareawardssubjecttomarketcondition
Expectedterm(inyears) 3.00 3.00 3.00
Weighted-averagevolatility 30% 40% 46%
Expecteddividendrate 4.3% 2.8% 3.8%
Risk-freeinterestrate 1.1% 1.1% 0.9%
Weighted-averagefairvalue $47.34 $58.31 $37.51