Lexmark 2007 Annual Report Download - page 74

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A summary of the status of the Company’s stock-based compensation plans as of December 31, 2007 and
2006, and changes during the years then ended is presented below:
Options
Weighted
Average
Exercise
Price
(Per Share)
Weighted
Average
Remaining
Contractual
Life (Years)
Aggregate
Intrinsic
Value
Outstanding at December 31, 2005 . . . . . . . . . . . . . 12.8 $66.30 6.1 $ 23.6
Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.9 50.09
Exercised . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1.4) 38.63
Forfeited or canceled . . . . . . . . . . . . . . . . . . . . . . (0.9) 77.43
Outstanding at December 31, 2006 . . . . . . . . . . . . . 11.4 $67.65 5.6 $138.2
Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.6 60.39
Exercised . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (0.3) 34.02
Forfeited or canceled . . . . . . . . . . . . . . . . . . . . . . (0.5) 78.39
Outstanding at December 31, 2007 . . . . . . . . . . . . . 11.2 $67.82 4.9 $ 2.2
Exercisable at December 31, 2006 . . . . . . . . . . . . . . 8.8 $69.12 5.3 $ 99.9
Exercisable at December 31, 2007 . . . . . . . . . . . . . . 9.5 $68.52 4.5 $ 2.2
For the years ended December 31, 2007 and 2006, the total intrinsic value of options exercised was
$7.7 million and $34.2 million, respectively. As of December 31, 2007, the Company had $8.2 million of
total unrecognized compensation expense, net of estimated forfeitures, related to unvested stock options
that will be recognized over the weighted average period of 1.3 years.
A summary of the status of the Company’s stock option plans as of December 31, 2005, and changes
during the year then ended is presented below:
Options
Weighted
Average
Exercise
Price
Outstanding at December 31, 2004 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.3 $60.73
Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2 81.96
Exercised . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1.2) 35.61
Forfeited or canceled . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (0.5) 71.36
Outstanding at December 31, 2005 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.8 $66.30
As of December 31, 2005, there were 9.0 million options exercisable.
Restricted Stock and Deferred Stock Units
Lexmark has granted RSUs with various vesting periods and generally these awards vest based upon
continued employment with the Company. As of December 31, 2007, the Company has issued DSUs to
certain members of management who elected to defer all or a portion of their annual bonus into such units
and to certain nonemployee directors who elected to defer all or a portion of their annual retainer, chair
retainer and/or meeting fees into such units. These DSUs are 100% vested when issued. The Company
has also issued supplemental DSUs to certain members of management upon the election to defer all or a
portion of an annual bonus into DSUs. These supplemental DSUs vest at the end of five years based upon
continued employment with the Company. The cost of the RSUs and supplemental DSUs, generally
determined to be the fair market value of the shares at the date of grant, is charged to compensation
expense ratably over the vesting period of the award.
68