NOTE  H — EQUITY BASED COMPENSATION

 

The Company utilizes a share-based compensation plan, which is more fully described in Note K to the Consolidated Financial Statements in Form 10-K for the year ended January 3, 2015.  The description provided applies to the Company’s 2006 Plan (“2006 Plan”), as well as its recently adopted 2015 Equity Incentive Award Plan (the “2015 Plan”).  The Company adopted the 2015 Plan to replace the 2006 Plan, which is set to expire in April of 2016.  The maximum number of shares of common stock available for issuance under the 2015 Plan is 5,000.  The Company began issuing awards under the 2015 Plan in the third quarter of 2015.

   

Equity-based compensation expense for the quarters ended September 27, 2014, and October 3, 2015,  was $1,858, and $2,564 respectively.  The related tax benefit for these periods was $613, and $857, respectively.  Expense for the nine months ended September 27, 2014 and October 3, 2015, was $5,929 and $6,952, respectively. The related tax benefit for these periods was $1,973 and $2,340 respectively. 

 

The following table shows the remaining unrecognized compensation expense on a pre-tax basis for all types of unvested equity awards outstanding as of October 3, 2015.  This table does not include an estimate for future grants that may be issued.

 

 

The Company uses the Black-Scholes option pricing model to estimate the fair value of its equity awards.  The weighted-average fair value of stock-settled stock appreciation rights that were granted during the nine months ended September 27, 2014, and October 3, 2015, was $17.92 and $47.43, respectively.  Following is a table that includes the weighted-average assumptions that the Company used to calculate fair value of equity awards that were granted during the periods indicated.

 

NOTE  H — EQUITY BASED COMPENSATION - CONTINUED

A summary of the Company’s stock option and stock-settled stock appreciation right activity is as follows:

 

 

*Aggregate intrinsic value is defined as the difference between the current market value at the reporting date (the closing price of the Company's common stock on the last trading day of the period) and the exercise price of awards that were in-the-money. The closing price of the Company's common stock at January 3, 2015, and October 3, 2015, was $102.28 and $135.38, respectively.

 

The total intrinsic value of stock-settled stock appreciation rights exercised during the nine months ended September 27, 2014, and October 3, 2015, was $17,125 and $33,764, respectively.       

 

The total fair value of equity awards that vested during the nine months ended September 27, 2014, and October 3, 2015, was $6,559 and $5,662, respectively.  This total fair value includes equity-based awards issued in the form of stock-settled stock appreciation rights.