Dollar Rent A Car 2011 Annual Report Download - page 76

The expected dividend payments were zero as the Company has not paid cash dividends since completion of its initial public offering. The
assumptions used to calculate compensation expense relating to the stock option awards granted during 2009 were as follows: weighted-average
expected life of the awards of five years, expected price volatility factor of 80.24%, risk-free interest rate of 2.36% and no dividend payments. The
weighted average grant-date fair value of options issued in 2009 was $4.44. The options issued in May 2009 vest in installments over three years with
20% exercisable in each of 2010 and 2011 and the remaining 60% exercisable in 2012. The total fair value of options vested during 2011, 2010 and
2009 was $4.0 million, $0.9 million and $0.2 million, respectively. Unrecognized expense remaining for the options at December 31, 2011, was $0.2
million and will be recognized through April 2012.
The following table sets forth the non-qualified option rights activity under the LTIP for the period indicated:
Weighted
Weighted Average Aggregate
Number of Average Remaining Intrinsic
Shares Exercise Contractual Value
(In Thousands) Price Term (In Thousands)
Outstanding at January 1, 2011 2,277 $ 5.73 7.61 $ 94,545
Granted - -
Exercised (672) 7.10
Canceled (Forfeited/Expired) (30) 7.62
Outstanding at December 31, 2011 1,575 $ 5.11 6.89 $ 102,579
Fully vested and exercisable options at:
December 31, 2011 917 $ 5.46 6.66 $ 59,398
Options expected to vest in the future at:
December 31, 2011 658 $ 4.63 7.23 $ 43,181
The total intrinsic value of options exercised during 2011, 2010 and 2009 was $38.1 million, $3.8 million, and $0.6 million, respectively. Total cash
received by the Company for non-qualified option rights exercised during 2011, 2010 and 2009 totaled $4.8 million, $3.0 million and $2.3 million,
respectively.
Performance Shares – Performance share awards, which may take the form of performance shares or performance units, are granted to Company
officers and certain key employees. The maximum amount of performance share awards that may be granted under the LTIP during any year to any
participant is 160,000 common shares. Values of the performance shares earned are recognized as compensation expense over the period the shares are
earned.
In December 2011, a target number of performance units was granted with a grant-date fair value of $69.58. The grant-date fair value for the awards
was based on the closing market price of the Company’s common shares on the date of grant. These performance units, which will settle in Company
shares, will vest over a three-year requisite service period following the grant date with 25% vesting on December 31, 2013 and the remaining 75%
vesting on December 31, 2014. The number of performance units ultimately earned will depend upon the level of corporate performance against a pre-
established target in 2012. In December 2010, a target number of performance units was granted with a grant-date fair value of $47.13. The grant-date
fair value for the awards was based on the closing market price of the Company’s common shares on the date of grant. These performance units,
which will settle in Company shares, will vest over a three-year requisite service period following the grant date with 25% vesting on December 31,
2012 and the remaining 75% vesting on December 31, 2013. Based upon the level of corporate performance against a pre-established target in 2011,
approximately 122,000 performance units were earned, subject to vesting requirements. No awards were granted in 2009.
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