|9 Months Ended|
Sep. 28, 2019
|Disclosure of Compensation Related Costs, Share-based Payments [Abstract]|
|STOCK-BASED COMPENSATION||STOCK-BASED COMPENSATION
Pursuant to the Kontoor Brands, Inc. 2019 Stock Compensation Plan (the “2019 Plan”), the Company is authorized to grant equity-based awards to officers, key employees and nonemployee members of the Company’s Board of Directors. The 2019 Plan also allows for the issuance of replacement grants related to the conversion of VF awards held by former employees of VF. Substantially all awards are classified as equity awards, which are accounted for within stockholders’ equity in the Company's balance sheet. Compensation cost for all awards expected to vest is recognized over the shorter of the requisite service period or the vesting period. Awards that do not vest are forfeited.
Prior to the Separation, certain Company employees participated in the VF amended and restated 1996 Stock Compensation Plan. At the Separation date, certain VF share-based awards held by Company employees were converted to options, restricted stock units (“RSUs”), performance-based RSUs and restricted stock awards for approximately 2.4 million shares of the Company’s common stock. Additionally, certain awards were retained by VF to be settled in accordance with their original terms. The Company is reporting the expense related to all awards granted prior to the Separation over the remaining vesting periods of the awards.
During the third quarter of fiscal 2019, the Company granted additional awards under the 2019 Plan, including performance-based RSUs for approximately 422,000 shares granted to employees, time-based RSUs for approximately 334,000 shares granted to employees and RSUs for approximately 30,000 shares granted to nonemployee members of the Board of Directors. The weighted average fair market value of the Company’s common stock at the dates the awards were granted was $32.26 per share.
Each performance-based RSU entitles the employee to a potential final payout ranging from 0% to 200% of one share of Kontoor common stock. The number of shares earned by participants, if any, is based on achievement of annually established performance goals set by the Talent and Compensation Committee of the Board of Directors. Shares earned will be issued to participants following the conclusion of the fiscal 2021 performance period.
Each time-based employee RSU entitles the employee to one share of Kontoor common stock and generally vests over a three-year period.Each RSU granted to a nonemployee member of the Board of Directors vests upon grant and will be settled in one share of Kontoor common stock one year from the date of grant.
The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef