Stock-Based Compensation | 3 Months Ended |
Sep. 28, 2013 |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' |
Stock-Based Compensation | ' |
Stock-Based Compensation |
The Amended and Restated 2005 Long-Term Incentive Plan (the “2005 Plan”) is the only equity-based compensation plan under which future awards may be made to employees of the Company and non-employee directors of R.G. Barry Corporation other than the employee stock purchase plan, currently inactive, in which only employees of the Company are eligible to participate. The Company’s previous equity-based compensation plans remained in effect with respect to the then outstanding awards following the original approval of the 2005 Plan. By shareholder action at the 2009 Annual Meeting of Shareholders, the 2005 Plan was amended to provide for an additional 500,000 common shares to be made available for future awards under the 2005 Plan (the “Amended 2005 Plan”). |
The Amended 2005 Plan provides for the granting of non-qualified stock options (“NQs”), incentive stock options (“ISOs”) that qualify under Section 422 of the Internal Revenue Code, stock appreciation rights, restricted stock, restricted stock units (“RSUs”), stock grants, stock units and cash awards, each as defined in the Amended 2005 Plan. Grants of restricted or unrestricted stock, RSUs and cash awards may also be performance-based awards, as defined in the Amended 2005 Plan. |
During the first quarter of fiscal 2014 and the first quarter of fiscal 2013, the Company granted performance-based RSUs to certain members of management. Each performance-based RSU is equivalent to one common share. The number of RSUs eligible for settlement to participants is ultimately based on the level of diluted earnings per share achieved by the Company relative to certain established minimum, target and maximum levels, for the fiscal year in which such performance-based RSUs are granted. If the minimum level of diluted earnings per share is not achieved for the fiscal year of grant, all of the performance-based RSUs underlying the award will be forfeited. If diluted earnings per share exceed the minimum level, the number of performance-based RSUs eligible for settlement will be determined when the annual financial results are finalized by the Company and one-third of those performance-based RSUs will be settled. The remaining performance-based RSUs eligible for settlement will vest to the participants based on continued service rendered to the Company over the following two fiscal-year periods, with annual pro rata vesting and settlement occurring at the end of each fiscal year. Except in instances of death or retirement where pro rata vesting would be applied, participants must be employed by the Company at the time of settlement in order to be vested in any portion of the award otherwise to be settled. |
Performance-based RSUs will be settled through an issuance of common shares for 50% of the performance-based RSUs and through cash payment for the other 50% of the performance-based RSUs valued at the fair value of a common share at the time of settlement. Based on expected annual diluted earnings per share by the Company as projected at quarter-end for fiscal 2014 and fiscal 2013, the number of total eligible performance-based RSUs was computed at 53,000 for fiscal 2014 and 55,400 for fiscal 2013, of which 50% was accounted for as an equity award and 50% was accounted for as a cash settlement award. The fair value of the equity award was determined based on the closing market price of a common share at the date of grant of $16.64 and $14.88 for the fiscal 2014 and the fiscal 2013 awards, respectively. Similarly, the fair value of the cash settlement award was initially based on the market price of a common share at the date of grant but is subject to periodic revaluation as changes occur in the market price of a common share over the time period of the award. In addition, consistent with its employee compensation policy, the Company granted an aggregate of 17,700 and 18,500 time-based RSUs, to certain members of management during the first quarter of fiscal 2014 and the first quarter of fiscal 2013, respectively, which vest in equal annual installments over three years. |
Under the provisions of FASB ASC 718, the Company recognized, as part of selling, general and administrative expenses, $364 and $349 of stock-based compensation expense for the first quarter of fiscal 2014 and the first quarter of fiscal 2013, respectively. |
The Company did not grant any stock options during the first quarter of fiscal 2014 or the first quarter of fiscal 2013, but has historically granted stock options at times to certain members of management and non-employee directors. The total compensation cost of stock options granted, but not yet vested as of September 28, 2013, was approximately $6, which will be recognized over a weighted-average period of approximately one year. |
During the first quarter of fiscal 2014 and the first quarter of fiscal 2013, the Company recognized gross excess tax benefits of $407 and $286, respectively, as additional paid-in capital under the provisions of FASB ASC 718 related to the vesting of RSUs and exercises of stock options. |
Activity with respect to stock options for the first quarter of fiscal 2014 was as follows: |
|
| | | | | | | |
| | Number of | | Weighted- |
common shares | average |
subject to NQs | exercise price |
Outstanding at June 29, 2013 | | 17,000 | | | $ | 8.82 | |
|
Granted | | — | | | — | |
|
Exercised | | 9,400 | | | 6.73 | |
|
Expired/Cancelled | | — | | | — | |
|
Outstanding at September 28, 2013 | | 7,600 | | | $ | 11.42 | |
|
Options exercisable at September 28, 2013 | | 4,000 | | | |
|
Activity with respect to time-based RSUs for the first quarter of fiscal 2014 was as follows: |
| |
| | | | | | | |
| Number of | | Grant date | |
common shares | fair value | |
underlying RSUs | | |
Nonvested at June 29, 2013 | 225,000 | | | $ | 10.59 | | |
|
Granted | 17,700 | | | 16.64 | | |
|
Vested | (100,600 | ) | | 8.09 | | |
|
Forfeited/Cancelled | — | | | — | | |
|
Nonvested at September 28, 2013 | 142,100 | | | $ | 13.11 | | |
|
Activity with respect to performance-based RSUs, with future settlement at vesting in common shares, for the first quarter of fiscal 2014 was as follows: |
| |
| | | | | | | |
| Number of | | Grant date | |
common shares | fair value | |
underlying RSUs | | |
Nonvested at June 29, 2013 | 65,000 | | | $ | 12.53 | | |
|
Granted, estimated based on target annual diluted earnings per share | 26,500 | | | 16.64 | | |
|
Vested | (27,300 | ) | | 12.13 | | |
|
Forfeited/Cancelled | — | | | — | | |
|
Nonvested at September 28, 2013 | 64,200 | | | $ | 14.4 | | |
|
During the first quarter of fiscal 2014 and the first quarter of fiscal 2013, an aggregate of 26,500 and 27,700, respectively, of performance-based RSUs with future settlement at vesting to be made in cash were granted and accounted for as cash settlement awards (based on expected diluted earnings per share by the Company for fiscal 2014 and fiscal 2013, respectively). The fair value of the awards is subject to initial valuation and subsequent periodic revaluation at the end of each quarterly reporting period based on the corresponding market price of a common share of the Company. |
Total compensation cost of time-based and performance-based compensation awards not yet vested as of September 28, 2013 was as follows: |
| | |
| | | | | | | |
| Unrecognized | | Weighted-average | | |
compensation cost | period in years | | |
Time-based RSU awards | $ | 1,002 | | | 3-Feb | | |
| |
Performance-based RSU awards (accounted for as equity award) | 495 | | | 3-Feb | | |
| |
Performance-based RSU awards (accounted for as cash settlement award) | 738 | | | 3-Feb | | |
| |
The aggregate intrinsic value, as defined in FASB ASC 718, of stock options exercised and RSUs vested during the first quarter of fiscal 2014 and the first quarter of fiscal 2013 was $1,079 and $1,771, respectively. |