SHAREHOLDERS’ EQUITY

Repurchase of Common Stock

At a meeting of the Board of Directors on July 24, 2018, authorization was granted to purchase up to $250.0 million of shares. For the three months ended March 30, 2019, there were zero repurchases under this program. As of March 30, 2019, there was approximately $196.9 million in common stock available for repurchase under the program. For the three months ended March 31, 2018, the Company acquired and retired 351,000 shares of its common stock for a total cost of $26.0 million under a prior repurchase program.

Share-Based Compensation

The majority of the Company’s annual share-based incentive awards are granted in the second fiscal quarter.

The Company recognized approximately $4.3 million and $3.4 million in share-based compensation expense for the three months ended March 30, 2019 and March 31, 2018, respectively. The total income tax benefit recognized in the Condensed Consolidated Statements of Income for share-based compensation expense was $0.9 million and $0.8 million for the three months ended March 30, 2019 and March 31, 2018, respectively. The Company recognizes compensation expense on grants of share-based compensation awards on a straight-line basis over the vesting period of each award. As of March 30, 2019, total unrecognized compensation cost related to share-based compensation awards was approximately $15.8 million, net of estimated forfeitures, which the Company expects to recognize over a weighted average period of approximately 1.6 years.

Approximately 2.6 million shares were available for future grant under the 2018 Equity Incentive Plan at March 30, 2019.

Stock Appreciation Rights

The Company uses stock settled stock appreciation rights (“SARs”) as a form of share-based incentive awards. SARs are the right to receive stock in an amount equal to the appreciation in value of a share of stock over the base price per share that generally vest over 5 years and expire 10 years from the grant date. All grants are made at prices equal to the fair market value of the stock on the grant date. For the three months ended March 30, 2019 and March 31, 2018, expired and canceled shares were immaterial.

The following table presents share-based compensation activity for the three months ended March 30, 2019 and March 31, 2018 (in millions):



	March 30, 2019		March 31, 2018
Total Intrinsic Value of Share-Based Incentive Awards Exercised	3.7		$	0.5
Income Tax (Expense) Benefit from the Exercise of SARs	(0.2	)	0.1
Total Fair Value of Share-Based Incentive Awards Vested	0.3		0.4

The following table presents a summary of share-based incentive plan grant activity the three months ended March 30, 2019.



Number of Shares Under SARs	Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value (in millions)
Outstanding as of December 29, 2018	1,539,368		$	69.31
Exercised	(192,858	)	64.45
Forfeited	(6,990	)	75.48
Outstanding as of March 30, 2019	1,339,520		$	69.97	3.9	$	15.9
Exercisable as of March 30, 2019	764,670		$	67.42	3.9	$	11.0

Compensation expense recognized related to SARs was $0.8 million for the three months ended March 30, 2019.

As of March 30, 2019, there was $5.5 million of unrecognized compensation cost related to non-vested SARs that is expected to be recognized as a charge to earnings over a weighted average period of 2.9 years.

The number of SARs expected to vest is materially consistent with those outstanding and not yet exercisable.

Restricted Stock Awards and Restricted Stock Units

Restricted stock awards ("RSA") and restricted stock units ("RSU") consist of shares or the rights to shares of the Company's stock. The awards are restricted such that they are subject to substantial risk of forfeiture and to restrictions on their sale or other transfer. As defined in the individual grant agreements, acceleration of vesting may occur under a change in control, death or disability.

The following table presents a summary of RSA award activity for the three months ended March 30, 2019:



	Shares	Weighted Average Fair Value at Grant Date		Weighted Average Remaining Contractual Term (Years)
Unvested RSAs as of December 29, 2018	15,660	$	74.38	0.4
Unvested RSAs as of March 30, 2019	15,660	$	74.38	0.1

RSAs vest on the first anniversary of the grant date, provided the holder of the shares is continuously employed by or in the service of the Company until the vesting date. Compensation expense recognized related to the RSAs was $0.3 million for the three months ended March 30, 2019.

As of March 30, 2019, there was $0.1 million of unrecognized compensation cost related to non-vested RSAs that is expected to be recognized as a charge to earnings over a weighted average period of 0.1 years.

The following table presents a summary of RSU award activity for the three months ended March 30, 2019:



	Shares		Weighted Average Fair Value at Grant Date		Weighted Average Remaining Contractual Term (Years)
Unvested RSUs as of December 29, 2018	234,824		$	69.78	1.6
Vested	(12,131	)	70.42
Forfeited	(2,650	)	71.18
Unvested RSUs as of March 30, 2019	220,043		$	69.72	1.4

RSUs vest on the third anniversary of the grant date, provided the holder of the RSUs is continuously employed by the Company until the vesting date. Compensation expense recognized related to the RSUs was $2.0 million for the three months ended March 30, 2019.

As of March 30, 2019, there was $5.5 million of unrecognized compensation cost related to non-vested RSUs that is expected to be recognized as a charge to earnings over a weighted average period of 1.4 years.

Performance Share Units

Performance share units ("PSU") consist of shares or the rights to shares of the Company's stock which are awarded to employees of the Company. These shares are payable upon the determination that the Company achieved certain established performance targets and can range from 0% to 200% of the targeted payout based on the actual results. PSUs have a performance period of 3 years and vest 3 years from the grant date. The PSUs have performance criteria based on a return on invested capital metric or they have performance criteria using returns relative to the Company's peer group. As set forth in the individual award agreements, acceleration of vesting may occur under a change in control, death or disability. There are no voting rights associated with PSUs until vesting occurs and a share of stock is issued. Some of the PSU awards are valued using a Monte Carlo simulation method as of the grant date while others are valued using the closing market price as of the grant date depending on the performance criteria for the award.

The following table presents a summary of PSU activity for the three months ended March 30, 2019:



	Shares		Weighted Average Fair Value at Grant Date		Weighted Average Remaining Contractual Term (Years)
Unvested PSUs as of December 29, 2018	167,840		$	71.71	1.8
Vested	(3,061	)	69.45
Forfeited	(6,298	)	75.04
Unvested PSUs as of March 30, 2019	158,481		$	71.63	1.7

Compensation expense for awards granted is recognized based on the grant issuance value or the expected payout ratio depending upon the performance criterion for the award, net of estimated forfeitures. Compensation expense recognized related to PSUs was $1.2 million for the three months ended March 30, 2019. Total unrecognized compensation expense for all PSUs granted as of March 30, 2019 is estimated to be $4.7 million which is expected to be recognized as a charge to earnings over a weighted average period of 1.7 years.