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SEC Filings

HEARTWARE INTERNATIONAL, INC. filed this Form 10-Q on 11/02/2015
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Upon receipt of stockholder approval on May 31, 2012, we adopted the HeartWare International, Inc. 2012 Incentive Award Plan (“2012 Plan”). The 2012 Plan provides for the grant of incentive stock options, non-qualified stock options, restricted stock, restricted stock units, performance awards, dividend equivalent rights, deferred stock, deferred stock units, stock payments and stock appreciation rights (collectively referred to as “Awards”), to our directors, employees and consultants. At our 2015 Annual Meeting of Stockholders held on June 4, 2015, our stockholders approved an amendment to the 2012 Plan to increase the number of shares of our common stock available for issuance by 1.1 million shares. Under the terms of the 2012 Plan, as amended, the total number of shares of our common stock reserved for issuance under Awards is 2,475,000, provided that the total number of shares of our common stock that may be issued pursuant to “Full Value Awards” (Awards other than options, SARs or other Awards for which the holder pays the intrinsic value existing as of the date of grant whether directly or by forgoing a right to receive a payment from the Company) is 2,375,000. As of September 30, 2015, 239,857 shares have been issued upon vesting of Awards issued under the 2012 Plan and Awards with respect to 693,351 shares were issued and outstanding under the 2012 Plan. Subsequent to adoption of the 2012 Plan, no new Awards will be granted under our prior plans. Any outstanding Awards under the prior plans will continue to be subject to the terms and conditions of the plan under which they were granted.

Stock Options

Each option allows the holder to subscribe for and be issued one share of our common stock at a specified price, which is generally the quoted market price of our common stock on the date the option is issued. Options generally vest on a pro-rata basis on each anniversary of the issuance date within four years of the date the option is issued. Options may be exercised after they have vested and prior to the specified expiry date provided applicable exercise conditions are met, if any. The expiry date can be for periods of up to ten years from the date the option is issued.

The fair value of each option is estimated on the date of grant using the Black-Scholes option pricing model based on the assumptions established at that time. The following table includes the weighted average assumptions used for options issued in the three and nine months ended September 30, 2015 and 2014.


     Three Months Ended
September 30,
    Nine Months Ended
September 30,
     2015     2014     2015     2014  

Dividend yield

     0     0     0     0

Expected volatility

     37.50     39.00     37.50     39.00

Risk-free interest rate

     1.69     1.65     1.69     1.65

Estimated holding period (years)

     5.00        5.00        5.00        5.00   

Information related to options granted under all of our plans at September 30, 2015 and activity in the nine months then ended is as follows (certain amounts in U.S.$ were converted from AU$ at the then period-end spot rate):


     Number of
(in thousands)
Life (Years)
(in thousands)

Outstanding at December 31, 2014

     107       $ 48.32         


     7         76.60         


     (3      27.95         


     —           —           


     —           —           




Outstanding at September 30, 2015

     111       $ 48.66         4.03       $ 1,727   




Exercisable at September 30, 2015

     99       $ 44.48         3.46       $ 1,727   




The aggregate intrinsic values at September 30, 2015 noted in the table above represent the number of in-the-money options outstanding or exercisable multiplied by the closing price of our common stock traded on NASDAQ less the weighted average exercise price at period end.