Hertz 2009 Annual Report Download - page 154
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HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
assume that each year 1% of the options that are outstanding but not vested will be forfeited because of
employee attrition.
Assumption 2009 Grants 2008 Grants
Expected volatility .................................. 34.9% 30.8%
Weighted-average volatility ............................ 34.9% 30.8%
Expected dividend yield .............................. 0.0% 0.0%
Expected term (years) ............................... 6.25 5.0 - 6.25
Risk-free interest rate ................................ 2.90% 2.56 - 3.75%
Forfeiture rate (per year) ............................. 1.0% 1.0%
Weighted-average grant date fair value ................... $1.29 $4.42
A summary of option activity under the Stock Incentive Plan and the Omnibus Plan as of December 31,
2009 is presented below.
Weighted-
Weighted- Average
Average Remaining Aggregate Intrinsic
Exercise Contractual Value (In thousands
Options Shares Price Term (years) of dollars)
Outstanding at January 1, 2009 ........ 16,087,407 $8.97 7.9 $ 3,987
Granted ......................... 52,500 $3.24
Exercised ........................ (1,034,204) $4.65
Forfeited or Expired ................. (995,399) $7.56
Outstanding at December 31, 2009 ...... 14,110,304 $9.38 7.0 56,221
Exercisable at December 31, 2009 ...... 7,430,924 $9.17 6.8 $32,166
The aggregate intrinsic value of options exercised during the years ended December 31, 2009 and 2008
was $4.2 million and $6.8 million, respectively. A total of 1,034,204 options were exercised in the year
ended December 31, 2009 and we received $5.3 million from the issuance of shares related to these
exercises.
A summary of non-vested options as of December 31, 2009, and changes during the year, is presented
below.
Weighted-
Weighted- Average Grant-
Non-vested Average Date Fair
Shares Exercise Price Value
Non-vested as of January 1, 2009 ................. 11,035,751 $9.33 $6.24
Granted ................................... 52,500 $3.24 $1.29
Vested .................................... (3,573,517) $9.36 $6.47
Forfeited or Expired ........................... (835,354) $7.56 $5.86
Non-vested as of December 31, 2009 .............. 6,679,380 $9.62 $6.16
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