DSW 2009 Annual Report Download - page 58

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As of January 30, 2010: Shares WAEP
Weighted
Average
Grant Date
Fair Value
Weighted
Average
Remaining
Contract Life
Aggregate
Intrinsic
Value
Options outstanding . . ............... 2,504 $18.20 $8.04 8 years $21,711
Options vested or expected to vest ...... 2,375 $18.32 $8.09 8 years $20,371
Options exercisable . . ............... 773 $23.26 $9.93 6 years $ 3,616
Shares available for additional grants .... 4,481
The aggregate intrinsic value is calculated as the amount by which the fair value of the underlying common
shares exceeds the option exercise price. The total intrinsic value of options exercised during fiscal 2009 and 2007
were $0.4 million and $0.2 million, respectively. This amount was immaterial in fiscal 2008. The total fair value of
options that vested during fiscal 2009, 2008 and 2007 was $4.3 million, $3.6 million and $2.0 million, respectively.
Restricted Stock Units — Restricted stock units generally cliff vest at the end of four years from the date of
grant and are settled immediately upon vesting. Restricted stock units granted to employees that are subject to the
risk of forfeiture are not included in the computation of basic earnings per share.
Compensation cost is measured at fair value on the grant date and recorded over the vesting period. Fair value
is determined by multiplying the number of units granted by the grant date market price. DSW expensed
$1.3 million, $0.7 million and $1.0 million, respectively, in fiscal 2009, 2008 and 2007 related to restricted stock
units. The total aggregate intrinsic value of nonvested restricted stock units was $6.4 million, $2.3 million and
$3.0 million for fiscal 2009, 2008 and 2007, respectively. As of January 30, 2010, the total compensation cost
related to nonvested restricted stock units not yet recognized was approximately $2.2 million with a weighted
average expense recognition period remaining of 1.6 years. The weighted average exercise price for all restricted
stock units is zero.
The following table summarizes DSW’s restricted stock units and weighted average grant date fair value
(“GDFV”) for the periods presented (shares in thousands):
Units GDFV Units GDFV Units GDFV
January 30, 2010 January 31, 2009 February 2, 2008
Fiscal Years Ended
Outstanding beginning of year ............. 226 $17.51 151 $23.92 135 $22.03
Granted ............................. 180 $10.39 158 $12.61 29 $28.69
Exercised/Vested ....................... (75) $19.77 (8) $26.61 (10) $24.85
Forfeited............................. (64) $15.30 (75) $19.08 (3) $27.96
Outstanding end of year ................. 267 $12.61 226 $17.51 151 $23.92
Director Stock Units — DSW issues stock units to directors who are not employees of DSW or RVI. During
fiscal 2009, 2008 and 2007, DSW granted 46,504, 45,265 and 10,398 director stock units, respectively, and
expensed $0.6 million, $0.6 million and $0.3 million, respectively, related to these grants. Stock units are
automatically granted to each director who is not an employee of DSW or RVI on the date of each annual meeting
of shareholders for the purpose of electing directors. The number of stock units granted to each non-employee
director is calculated by dividing one-half of the director’s annual retainer (including committee retainer fees but
excluding any amount paid for service as the chair of a board committee) by the fair market value of a share of the
DSW Class A Common Shares on the date of the meeting. In addition, each director eligible to receive
compensation for board service may elect to have the cash portion of such directors’ compensation paid in the
form of stock units. Stock units granted to directors vest immediately and are settled upon the director terminating
service from the board. Stock units granted to directors which are not subject to forfeiture are considered to be
outstanding for the purposes of computing basic earnings per share. The exercise price of the director stock units is
F-14
DSW INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)