CarMax 2010 Annual Report Download - page 76

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66
COMPOSITION OF SHARE-BASED COMPENSATION EXPENSE – BY GRANT TYPE
(In thousands)
Nonqualified stock options 17,404$ 19,031$ 21,490$
Res tricted s tock 11,571 15,823 11,656
Cash-settled restricted stock units 5,718 ― ―
Stock-s ettled res tricted stock units 2,614 ― ―
Employee stock purchase plan 987 1,081 1,214
Stock grants to non-employee directors 550 583 322
Share-based compensation expense, before income taxes 38,844$ 36,518$ 34,682$
Years Ende d Fe bruar y 2 8 or 2 9
2010 2009 2008
We recognize compensation expense for stock options, restricted stock and MSUs on a straight-line basis (net of
estimated forfeitures) over the requisite service period, which is generally the vesting period of the award. The
variable expense associated with RSUs is recognized over their vesting period (net of expected forfeitures) and is
calculated based on the closing market price of our common stock at the end of each reporting period. There were
no capitalized share-based compensation costs as of the end of fiscal 2010, fiscal 2009 or fiscal 2008.
STOCK OPTION ACTIVITY
Outs tanding as of M arch 1, 2009 14,844 15.40$
Options granted 2,948 11.52$
Options exercised (3,086) 11.41$
Options forfeited or expired (965) 13.66$
Outs tanding as of February 28, 2010 13,741 15.58$ 4.7 71,446$
Exercisable as of February 28, 2010 7,895 15.16$ 4.2 43,864$
Weighted
Average
Remaining
Contractual
Life (Years )
Aggregate
Intr i n s i c
Value
Number of
Shares
(Shares and intrinsic value in thousands)
Weighted
Average
Exercise
Price
We granted nonqualified options to purchase 2,948,150 shares of common stock in fiscal 2010 and 2,219,857 shares
of common stock in fiscal 2009. The total cash received as a result of stock option exercises was $35.2 million in
fiscal 2010, $10.2 million in fiscal 2009 and $14.7 million in fiscal 2008. We settle stock option exercises with
authorized but unissued shares of our common stock. The total intrinsic value of options exercised was $25.8
million for fiscal 2010, $5.7 million for fiscal 2009 and $26.8 million for fiscal 2008. We realized related tax
benefits of $10.1 million for fiscal 2010, $2.2 million for fiscal 2009 and $10.6 million for fiscal 2008.
OUTSTANDING STOCK OPTIONS
$7.02 to $7.15 976 3.0 7.14$ 976 7.14$
$10.74 to $11.43 2,880 6.0 11.42$ 56 10.75$
$13.19 2,096 5.3 13.19$ 2,096 13.19$
$14.13 to $14.86 2,295 4.2 14.66$ 2,145 14.66$
$15.17 to $17.44 1,679 3.2 17.07$ 1,237 17.08$
$19.36 to $19.82 2,138 5.1 19.80$ 532 19.78$
$22.28 to $25.79 1,677 4.1 25.03$ 853 25.03$
Total 13,741 4.7 15.58$ 7,895 15.16$
Options Outstanding
As of February 28, 2010
Options Exercisable
Number of
Shares
Weighted
Average
Remaining
Contractual
Life (Years)
(Shares in thousands)
Range of Exercise Prices
Weighted
Average
Exercise
Price
Number of
Shares
Weighted
Average
Exercise
Price