Lexmark 2008 Annual Report Download - page 85

Download and view the complete annual report

Please find page 85 of the 2008 Lexmark annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 124

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124

A summary of the status of the Company’s stock-based compensation plans as of December 31, 2008,
2007 and 2006, and changes during the years then ended is presented below:
Options
(In Millions)
Weighted
Average
Exercise
Price
(Per Share)
Weighted
Average
Remaining
Contractual
Life (Years)
Aggregate
Intrinsic
Value
(In Millions)
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
Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.6 32.89
Exercised. . . . . . . . . . . . . . . . . . . . . . . . . . . . (0.2) 23.25
Forfeited or canceled . . . . . . . . . . . . . . . . . . . (1.1) 70.42
Outstanding at December 31, 2008 . . . . . . . . . . 10.5 $66.16 4.3 $ —
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
Exercisable at December 31, 2008 . . . . . . . . . . 9.2 $68.14 3.8 $ —
For the years ended December 31, 2008, 2007 and 2006, the total intrinsic value of options exercised was
$1.8 million, $7.7 million and $34.2 million, respectively. As of December 31, 2008, the Company had
$5.3 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 1.6 years.
Restricted Stock and Deferred Stock Units
Lexmark has granted RSUs with various vesting periods and generally these awards vest based upon
continued service with the Company or continued service on the board. As of December 31, 2008, 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.
79