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Stock-based Compensation
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6 Months Ended |
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Jul. 02, 2011
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| Stock-based Compensation | Ìý |
| Stock-based Compensation |
Note J — Stock-based Compensation
During the quarter ended JuneÌý2011, ÂÒÂ×°ÍÊ¿ did not grant any stock-based compensation awards.
During the first six months of 2011, ÂÒÂ×°ÍÊ¿ granted options to purchaseÌý925,635 shares of Common Stock at an exercise price of $95.56, equal to the market value of ÂÒÂ×°ÍÊ¿ Common Stock on the option grant date. The options vest in equal annual installments, generally over a three year period. The fair value of these options was estimated using a lattice valuation model, with the following assumptions: expected volatility ranging from 27% to 38%, with a weighted average of 34%; expected term ofÌý5.6 toÌý7.5Ìýyears; expected dividend yield of 3.1%; and a risk-free interest rate ranging from 0.2% at six months to 3.5% at 10Ìýyears. The resulting weighted average fair value of these options at the grant date was $24.99 per option.
Also during the first six months of 2011, ÂÒÂ×°ÍÊ¿ grantedÌý241,751 performance-based restricted stock units that generally entitle the recipients to receive shares of ÂÒÂ×°ÍÊ¿ Common Stock at the end of a three year performance period. The actual number of shares that will be earned, if any, will be based on ÂÒÂ×°ÍÊ¿'s performance over that period. The fair value of ÂÒÂ×°ÍÊ¿'s Common Stock at the date the units were granted was $95.23 per share.
ÂÒÂ×°ÍÊ¿ also granted, during the first six months of 2011,Ìý19,000 shares of restricted ÂÒÂ×°ÍÊ¿ Common Stock andÌý15,000 restricted stock units with a fair value at the grant date of $86.51 per share. These shares and units will vest in 2015, assuming the grantees remain employed through the vesting date.
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