Macy's 2010 Annual Report Download - page 89

Download and view the complete annual report

Please find page 89 of the 2010 Macy's 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 112

  • 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

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The following table reflects the benefit payments estimated to be funded by the Company and paid from the
accumulated postretirement benefit obligations and estimated federal subsidies expected to be received under the
Medicare Prescription Drug Improvement and Modernization Act of 2003:
Expected
Benefit
Payments
Expected
Federal
Subsidy
(millions)
Fiscal Year:
2011 ........................................................ $ 28 $1
2012 ........................................................ 28 1
2013 ........................................................ 27 1
2014 ........................................................ 26 1
2015 ........................................................ 25 1
2016-2020 ................................................... 109 5
13. Stock Based Compensation
During 2009, the Company obtained shareholder approval for the Macy’s 2009 Omnibus Incentive
Compensation Plan under which up to fifty-one million shares of Common Stock may be issued. This plan is
intended to help the Company attract and retain directors, officers, other key executives and employees and is
also intended to provide incentives and rewards relating to the Company’s business plans to encourage such
persons to devote themselves to the business of the Company. Prior to 2009, the Company had two equity
plans. As a result of the August 30, 2005 acquisition of The May Department Stores Company (“May”), the
Company assumed May’s equity plan, which was subsequently amended to have identical terms and provisions
of the Company’s other equity plan. At August 30, 2005, all outstanding May options under May’s equity plan
were fully vested and were converted into options to acquire common stock of the Company in accordance with
the merger agreement. The following disclosures present the Company’s equity plans prior to 2009 on a
combined basis. The equity plan is administered by the Compensation and Management Development
Committee of the Board of Directors (the “CMD Committee”). The CMD Committee is authorized to grant
options, stock appreciation rights, restricted stock and restricted stock units to officers and key employees of the
Company and its subsidiaries and to non-employee directors.
Stock option grants have an exercise price at least equal to the market value of the underlying common
stock on the date of grant, have ten-year terms and typically vest ratably over four years of continued
employment. Restricted stock and time-based restricted stock unit awards generally vest one to four years from
the date of grant. Performance-based restricted stock units vest based on the results attained during the
performance period.
As of January 29, 2011, 41.7 million shares of common stock were available for additional grants pursuant
to the Company’s equity plan. Common stock is delivered out of treasury stock upon the exercise of stock
options and grant of restricted stock.
F-41