US Bank 2005 Annual Report Download - page 93
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Additional information regarding stock options outstanding as of December 31, 2005, is as follows:
Options Outstanding Exercisable Options
Weighted-
Average Weighted- Weighted-
Remaining Average Average
Contractual Exercise Exercise
Range of Exercise Prices Shares Life (Years) Price Shares Price
$5.05 — $10.00 ***************************************** 91,470 .7 $ 7.31 91,470 $ 7.31
$10.01 — $15.00 **************************************** 2,107,124 1.7 11.37 2,107,124 11.37
$15.01 — $20.00 **************************************** 20,476,728 5.1 18.80 20,295,870 18.80
$20.01 — $25.00 **************************************** 52,679,575 5.1 22.37 45,685,591 22.48
$25.01 — $30.00 **************************************** 35,825,425 4.3 28.58 27,713,694 28.68
$30.01 — $35.00 **************************************** 14,515,311 7.0 30.91 3,928,611 32.72
$35.01 — $36.95 **************************************** 287,828 1.4 35.90 287,828 35.90
125,983,461 5.0 $24.38 100,110,188 $23.64
Stock-based compensation was $132 million in 2005, certain circumstances may be required to recognize an
compared with $176 million and $158 million in 2004 and adjustment to tax expense. On an after-tax basis, stock-
2003, respectively. At the time employee stock options based compensation was $83 million in 2005, compared
expire, are exercised or cancelled, the Company determines with $139 million and $123 million in 2004 and 2003,
the tax benefit associated with the stock award and under respectively.
The following table provides a summary of the valuation assumptions utilized by the Company to determine the estimated
value of stock option grants:
Weighted-average assumptions in stock option valuation 2005 2004 2003
Risk-free interest rates **************************************************************************************** 3.6% 3.5% 2.8%
Dividend yields*********************************************************************************************** 3.5% 3.5% 3.0%
Stock volatility factor****************************************************************************************** .29 .40 .40
Expected life of options (in years)******************************************************************************* 5.4 5.9 5.3
Stock-based compensation expense is based on the fair have characteristics that differ from those of traded options,
value of the award at the date of grant or modification. The including vesting provisions and trading limitations that
fair value of options was estimated using the Black-Scholes impact their liquidity, the determined value used to measure
option-pricing model requiring the use of subjective compensation expense may vary from their actual fair
valuation assumptions. Because employee stock options value.
U.S. BANCORP 91