Comfort Inn 2014 Annual Report Download - page 98

Table of Contents
The practice of the Company is to recognize interest and penalties related to income tax matters in the provision for income taxes. The Company did
not incur any material interest or penalties for 2014 and 2013. The Company had $0.7 million and $1.6 million of accrued interest and penalties at December
31, 2014 and 2013, respectively.
The Company has not provided deferred United States income taxes on approximately $205.2 million of accumulated and undistributed earnings of its
foreign subsidiaries. The Company's intent is for such earnings to be permanently reinvested in operations outside the United States. Determination of the
deferred United States income tax liability on these earnings is not practicable because such liability, if any, is dependent on circumstances existing if and
when remittance occurs.
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Dividends
The Company currently maintains the payment of a quarterly dividend on its common shares outstanding, however, the declaration of future dividends
are subject to the discretion of our board of directors. During the years ended December 31, 2013 and 2012, the Company's board of directors declared
quarterly cash dividends at a quarterly rate of $0.185 per share for an annual rate of $0.74 per share or $43.2 million and $42.7 million, respectively. The
Company maintained its quarterly dividend rate of $0.185 per share for the first three quarters of 2014. In the fourth quarter of 2014, the Company's board of
directors announced an increase in the quarterly dividend rate to $0.195 per share. As a result, annual dividends declared during the year ended December 31,
2014 were $0.75 per share or $43.8 million.
In addition, during the years ended December 31, 2014 and 2013, the Company paid previously declared but unrecorded dividends totaling $0.4
million and $0.5 million, respectively, that were contingent upon the vesting of performance vested restricted units. No dividends on performance vested
restricted units were paid during the year ended December 31, 2012.
On July 26, 2012, the Company's board of directors declared a special cash dividend to common shareholders in the amount of $10.41 per share or
approximately $600.7 million ("Special Cash Dividend") which was paid on August 23, 2012.
Share-Based Compensation
The Company recognizes compensation cost related to share-based payment transactions in the financial statements based on the fair value of the
equity or liability instruments issued. Compensation expense related to the fair value of share-based awards is recognized over the requisite service period
based on an estimate of those awards that will ultimately vest. The Company estimates the share-based compensation expense for awards that will ultimately
vest at the inception of the grant. Over the life of the grant, the estimate of share-based compensation expense for awards with performance and/or service
requirements is adjusted so that compensation cost is recognized only for awards that ultimately vest.
The Company has stock compensation plans pursuant to which it is authorized to grant stock-based awards of up to 7.6 million shares of the
Company’s common stock, of which 2.7 million shares remain available for grant as of December 31, 2014. The Company’s policy allows the issuance of new
or treasury shares to satisfy stock-based awards. Restricted stock, stock options, stock appreciation rights and performance share awards may be granted to
officers, key employees and non-employee directors with contractual terms set by the Compensation and Management Development Committee of the Board
of Directors.
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