SHARE-BASED COMPENSATION

3 Months Ended

Jun. 27, 2014

SHARE-BASED COMPENSATION

SHARE-BASED COMPENSATION

3.  SHARE-BASED COMPENSATION

During the first quarter of fiscal 2015, the Company granted equity compensation awards under the 2010 Equity Incentive Plan (the “2010 Plan”).  The following table summarizes the Company’s share-based compensation expense:

	Three-Month Periods Ended
	June 27, 2014		June 28, 2013
	(In thousands)
Cost of sales	$	1,611	$	1,352
Selling, general and administrative expenses	10,071		7,237
Total stock-based compensation expense	$	11,682	$	8,589

No options were granted under the 2010 Plan during the first quarter of fiscal 2015.  Total unrecognized compensation expense related to share options is $0.4 million, net of estimated forfeitures, and will be recognized over a weighted-average remaining vesting period of 0.9 years. As of June 27, 2014, the number of options outstanding and exercisable was 20.7 million and 20.6 million, respectively, at weighted-average exercise prices of $8.36 and $8.38 per share, respectively.

During the three-month period ended June 27, 2014, the Company granted 3.1 million unvested share bonus awards at an average grant date price of $11.20 per share, under its 2010 Plan.  Additionally, the Company granted share bonus awards to certain key employees of 0.9 million shares, which represents the target amount, whereby vesting is contingent primarily on certain market conditions.  These shares will cliff vest after a period of three years, if such conditions have been met. The number of shares issued can range from zero to 1.8 million based on the achievement levels of the respective conditions.

As of June 27, 2014, approximately 18.6 million unvested share bonus awards were outstanding under the 2010 Plan, of which vesting for a targeted amount of 5.2 million is contingent primarily on meeting certain market conditions.  The number of shares that will ultimately be issued can range from zero to 10.1 million based on the achievement levels of the respective conditions.  During the three-month period ended June 27, 2014, 0.3 million shares vested in connection with the remaining number of share bonus awards with market conditions granted in fiscal 2011, and 0.4 million shares vested in connection with half of the share bonus awards with market conditions granted in fiscal 2012.

As of June 27, 2014, total unrecognized compensation expense related to unvested share bonus awards granted under the 2010 Plan is $92.9 million, net of estimated forfeitures, and will be recognized over a weighted-average remaining vesting period of 2.75 years.

Approximately $25.6 million of the total unrecognized compensation cost, net of estimated forfeitures, is related to awards whereby vesting is contingent on meeting certain market conditions.