Note 13 - Shareholders' Equity

12 Months Ended

Jan. 02, 2016

Notes to Financial Statements

Stockholders' Equity Note Disclosure [Text Block]

13. Shareholders’ Equity

Equity Plans

: The company has equity-based compensation plans authorizing the granting of stock options, restricted shares, restricted share units, performance shares and other stock rights of employees and directors. As of January 2, 2016, there were approximately 0.6 million shares available for issuance of future awards under the company’s equity-based compensation plans.

Stock options granted prior to 2002 vested over a five-year period and are exercisable over a ten-year period commencing from the date of vesting. The stock options granted in 2002 through February 2005 vested over a five-year period and are exercisable over a ten-year period commencing from the date of the grant. Stock options granted after February 2005 vest over a three, four or five-year period and are exercisable over either a seven or ten-year period commencing from the date of the grant. Restricted shares and share units granted by the company vest over three to four years.

The following table provides a reconciliation of outstanding stock options for the fiscal year ended January 2, 2016.

	Shares Under Option			Weighted Average Price		Weighted Average Remaining Contract Life (Years)		Aggregate Intrinsic Value (000’s)
Outstanding December 27, 2014		421,862		$	67.88
Granted		145,140			96.18
Exercised		(95,548	)		48.74
Forfeited		(550	)		29.68
Outstanding January 2, 2016		470,904			80.53		4.8	$	12,470
Exercisable January 2, 2016		199,472			66.23		3.6		8,135

The following table provides a reconciliation of non-vested restricted share and share unit awards for the fiscal year ended January 2, 2016.

	Shares			Weighted Average Grant-Date Fair Value
Nonvested December 27, 2014		188,998		$	78.91
Granted		103,002			94.10
Vested		(88,901	)		73.59
Forfeited		(8,638	)		80.40
Nonvested January 2, 2016		194,461			89.32

The total intrinsic value of options exercised during 2015, 2014 and 2013 was $5.0 million, $9.6 million, and $15.3 million, respectively. The total fair value of shares vested was $8.1 million, $7.6 million, and $6.5 million for 2015, 2014 and 2013, respectively. The total amount of share-based liabilities paid was $0.4 million, $0.3 million and $0.1 million for 2015, 2014 and 2013, respectively.

The company recognizes compensation cost of all share-based awards as an expense on a straight-line basis over the vesting period of the awards. At January 2, 2016, the unrecognized compensation cost for options, restricted shares and performance shares was $13.2 million before tax, and will be recognized over a weighted-average period of 1.9 years. Compensation cost included as a component of selling, general and administrative expense for all equity compensation plans discussed above was $10.7 million, $9.4 million and $8.9 million for 2015, 2014 and 2013, respectively. The total income tax benefit recognized in the Consolidated Statements of Net Income was $3.7 million, $3.3 million and $3.2 million for 2015, 2014 and 2013, respectively.

The company uses the Black-Scholes option valuation model to determine the fair value of awards granted. The weighted average fair value of and related assumptions for options granted are as follows:

	201 5			201 4			201 3
Weighted average fair value of options granted	$	21.99		$	26.25		$	23.90
Assumptions:
Risk-free interest rate		1.25	%		1.67	%		0.70	%
Expected dividend yield		1.04	%		0.93	%		1.20	%
Expected stock price volatility		28.0	%		33.0	%		45.0	%
Expected life of options (years)		4.6			4.6			5.1

Expected volatilities are based on the historical volatility of the company’s stock price. The expected life of options is based on historical data for options granted by the company

.

The risk-free rates are based on yields available at the time of grant on U.S. Treasury bonds with maturities consistent with the expected life assumption.

Accumulated Other Comprehensive Income (Loss)

(AOCI)

: The following table sets forth the changes in the components of AOCI by component for fiscal years 2015, 2014 and 2013 (in thousands):

	Pension liability adjustments (a)			Gain on investments (b)		Foreign currency translation adjustment			Accumulated other comprehensive income (loss)
Balance at December 28, 2013	$	(17,140	)	$	9,393	$	28,164		$	20,417
2014 activity		(12,475	)		1,398		(30,466	)		(41,543	)
Balance at December 27, 2014		(29,615	)		10,791		(2,302	)		(21,126	)
2015 activity		20,893			793		(46,231	)		(24,545	)
Balance at January 2, 2016	$	(8,722	)	$	11,584	$	(48,533	)	$	(45,671	)

(a) Net of tax of $661, $12,587, and $6,549 for 2015, 2014 and 2013, respectively.

(b) Net of tax of $0, $0 and $0 for 2015, 2014 and 2013, respectively.

Preferred Stock

: The Board of Directors may authorize the issuance of preferred stock from time to time in one or more series with such designations, preferences, qualifications, limitations, restrictions and optional or other special rights as the Board may fix by resolution.

The Board of Directors authorized the repurchase of up to 1,000,000 shares of the company’s common stock under a program for the period May 1, 2015 to April 30, 2016. The company repurchased 350,000 of its shares in fiscal 2015 and 650,000 shares remain available for purchase under the initial program as of January 2, 2016.