Wells Fargo 2010 Annual Report Download - page 199

Year ended December 31,
(in millions) 2010 2009 2008
RSRs $ 252 3 3
Performance shares 66 21 -
Stock options 118 221 174
Total stock incentive compensation
expense $ 436 245 177
Related recognized tax benefit $ 165 92 65
A portion of annual bonus awards recognized during 2009
that are normally paid in cash was paid in our common stock as
part of our agreement with the U.S. Treasury to repay our
participation in the TARP CPP. The fair value of the stock that
was issued was $94 million and there were no vesting conditions
or other restrictions on the stock. No annual bonus awards
recognized during 2010 were paid in common stock.
During 2009 the Board of Directors approved salary
increases for certain executive officers that were paid, after taxes
and other withholdings, in our common stock. In 2010 and
2009, respectively, 62,630 shares and 244,689 shares were
issued for salary increases at an average fair value of $27.44 and
$27.77, respectively. There are no restrictions on these shares
because we repaid the TARP CPP investment in Wells Fargo in
December 2009. No salary increases were paid in common stock
after February 2010.
For various acquisitions and mergers, we converted employee
and director stock options of acquired or merged companies into
stock options to purchase our common stock based on the terms
of the original stock option plan and the agreed-upon exchange
ratio. In addition, we converted restricted stock awards into
awards that entitle holders to our stock after the vesting
conditions are met. Holders receive cash dividends on
outstanding awards if provided in the original award.
The total number of shares of common stock available for
grant under the plans at December 31, 2010, was 255 million.
PARTNERSHARES PLAN In 1996, we adopted the
PartnerShares® Stock Option Plan, a broad-based employee
stock option plan. It covers full- and part-time employees who
generally were not included in the LTICP described above. No
options have been granted under the plan since 2002, and as a
result of action taken by the Board of Directors on
January 22, 2008, no future awards will be granted under the
plan. All of our PartnerShares Plan grants were fully vested as of
December 31, 2007.
Director Plan
We grant common stock and options to purchase common stock
to non-employee directors elected or re-elected at the annual
meeting of stockholders and prorated awards to directors who
join the Board at any other time. The stock award vests
immediately. Options granted in 2008 or earlier can be
exercised after six months through the tenth anniversary of the
grant date. Options granted prior to 2005 may include the right
to acquire a “reload” stock option. Prior to 2009, stock awards
and option grants were made to non-employee directors under
the Directors Stock Compensation and Deferral Plan. As a result
of action taken by the Board of Directors on September 30,
2008, stock awards and options granted in 2010 and 2009 were
made under our LTICP; options granted to directors under the
LTICP can be exercised after 12 months through the tenth
anniversary of the grant date.
Restricted Share Rights
A summary of the status of our RSRs and restricted share awards
at December 31, 2010, and changes during 2010 is in the
following table:
Weighted-
average
grant-date
Number fair value
Nonvested at January 1, 2010 1,908,955 $ 23.62
Granted 22,364,160 27.29
Vested (568,417) 27.21
Canceled or forfeited (667,976) 27.59
Nonvested at December 31, 2010 23,036,722 26.98
The weighted-average grant date fair value of RSRs granted
during 2009 and 2008 was $19.04 and $29.68, respectively.
At December 31, 2010, there was $363 million of total
unrecognized compensation cost related to nonvested RSRs. The
cost is expected to be recognized over a weighted-average period
of 4.0 years. The total fair value of RSRs that vested during 2010,
2009 and 2008 was $15 million, $2 million and $1 million,
respectively.
Stock Options
The table below summarizes stock option activity and related
information for the employee stock plans and the director plan.
Options assumed in mergers are included in the activity and
related information for Incentive Compensation Plans if
originally issued under an employee plan, and in the activity and
related information for Director Plans if originally issued under
a director plan.
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