Redbox 2011 Annual Report Download - page 78

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vesting schedules and expectations of future employee behavior. The increase of the expected term
assumption during 2010 was due to an increase in the contractual term of options granted to our
executives beginning February 2010 as compared to prior periods.
• Expected stock price volatility is based on historical volatility of our stock for a period at least equal to
the expected term.
• The risk-free interest rate is based on the implied yield available on U.S. Treasury zero-coupon issues
with an equivalent expected term.
• We have not paid dividends in the past and do not plan to pay any dividends in the foreseeable future.
The following table presents a summary of stock option activity for 2011:
Shares in thousands Shares
Weighted
Average
Exercise Price
OUTSTANDING, December 31, 2010 ............................... 1,103 $29.41
Granted .................................................... 93 45.78
Exercised .................................................. (112) 29.03
Cancelled, expired, or forfeited ................................. (96) 31.63
OUTSTANDING, December 31, 2011 ............................... 988 30.77
Certain information regarding stock options outstanding as of December 31, 2011, is as follows:
Shares and intrinsic value in thousands
Options
Outstanding
Options
Exercisable
Number ...................................................... 988 560
Weighted average per share exercise price .......................... $ 30.76 $29.24
Aggregate intrinsic value ........................................ $14,914 $8,957
Weighted average remaining contractual term (in years) ............... 3.2 2.2
Restricted stock awards
Restricted stock awards are granted to eligible employees, including executives, and non-employee directors.
Awards granted to employees and executives vest annually in equal installments over four years. Non-employee
director awards vest one year after the grant date. Performance-based restricted stock awards are granted to
executives only, with established performance criteria approved by the Compensation Committee of the Board of
Directors, once earned, and vest in equal installments over three years from the date of grant. The restricted
shares require no payment from the grantee. The fair value of the awards is based on the market price on the
grant date and is recognized on a straight-line basis over the vesting period or based on achieving performance
conditions.
The following table presents a summary of restricted stock award activity for 2011:
Shares in thousands
Restricted
Stock Awards
Weighted
Average
Grant Date
Fair Value
NON-VESTED, December 31, 2010 .............................. 414 $32.82
Granted ................................................. 347 45.86
Vested .................................................. (153) 33.70
Forfeited ................................................ (81) 37.27
NON-VESTED, December 31, 2011 .............................. 527 40.44
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