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H. J. Heinz Company and Subsidiaries
Notes to Consolidated Financial Statements — (Continued)
tax benefits as a financing cash inflow. For the fiscal year ended April 28, 2010, $6.9 million of cash
tax benefits was reported as an operating cash inflow and $2.4 million of excess tax benefits as a
financing cash inflow. For the fiscal year ended April 29, 2009, $9.5 million of cash tax benefits was
reported as an operating cash inflow and $4.8 million of excess tax benefits as a financing cash inflow.
As of April 27, 2011, there were no shares available for issuance under the 2000 Plan due to the
expiration of the 2000 Plan in September 2010. During the fiscal year ended April 27, 2011,
7,465 shares were forfeited and returned to the plan. During the fiscal year ended April 27, 2011,
10,117 shares were issued from the 2000 Plan.
A summary of the Company’s 2003 Plan at April 27, 2011 is as follows:
2003 Plan
(Amounts in
thousands)
Number of shares authorized . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,869
Number of stock option shares granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (8,343)
Number of stock option shares cancelled/forfeited and returned to the plan . . 236
Number of restricted stock units and restricted stock issued . . . . . . . . . . . . . . (4,532)
Shares available for grant as stock options . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,230
During Fiscal 2011, the Company granted 1,733,135 option awards to employees sourced from
the 2000 and 2003 Plans. The weighted average fair value per share of the options granted during the
fiscal years ended April 27, 2011, April 28, 2010 and April 29, 2009 as computed using the Black-
Scholes pricing model was $5.36, $4.71, and $5.75, respectively. The weighted average assumptions
used to estimate these fair values are as follows:
April 27,
2011
Fiscal Year Ended
April 28,
2010
April 29,
2009
Dividend yield . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.9% 4.3% 3.3%
Expected volatility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20.5% 20.2% 14.9%
Expected term (years) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.5 5.5 5.5
Risk-free interest rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.7% 2.7% 3.1%
The dividend yield assumption is based on the current fiscal year dividend payouts. The expected
volatility of the Company’s common stock at the date of grant is estimated based on a historic daily
volatility rate over a period equal to the average life of an option. The weighted average expected life
of options is based on consideration of historical exercise patterns adjusted for changes in the
contractual term and exercise periods of current awards. The risk-free interest rate is based on the
U.S. Treasury (constant maturity) rate in effect at the date of grant for periods corresponding with
the expected term of the options.
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