Hertz 2009 Annual Report Download - page 156

HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Grant Fair Number of
Date Value Units
2/26/09 $ 3.24 2,439,363
2/26/09 $ 3.24 2,095,376
3/13/09 $ 2.75 1,400,000
5/1/09 $ 6.45 495,500
5/11/09 $ 8.38 10,000
7/31/09 $ 9.44 10,000
8/14/09 $11.02 15,000
6,465,239
Compensation expense for RSUs and PSUs is based on the grant date fair value, and is recognized
ratably over the vesting period. For grants in 2008, the vesting period is two years (50% in the first year
and 50% in the second year). For grants in 2009, the vesting period is three years (25% in the first year,
25% in the second year and 50% in the third year). The PSUs have an additional vesting condition. The
restriction period applicable to the PSUs will lapse on the first anniversary of the grant date if the
consolidated leverage ratio covenants within our Senior Credit Facilities have not been violated during
that twelve month period. Assuming the restriction period has lapsed, the grants will vest pursuant to the
vesting schedule. If the consolidated leverage ratio covenant is violated during the first twelve months, all
PSUs will be forfeited.
Impact on Results
A summary of the total compensation expense and associated income tax benefits recognized under
our Prior Plans and the Omnibus Plan, including the cost of stock options, RSUs, and PSUs, is as
follows:
Years ended December 31,
2009 2008 2007
Compensation Expense .................................... $34.5 $ 27.8 $ 32.9
Income Tax Benefit ........................................ (13.4) (10.7) (12.7)
Total ................................................. $21.1 $ 17.1 $ 20.2
As of December 31, 2009, there was approximately $51.7 million of total unrecognized compensation
cost related to non-vested stock options, RSUs and PSUs granted by Hertz Holdings under the Prior
Plans and the Omnibus Plan, including costs related to modifying the exercise prices of certain option
grants in order to preserve the intrinsic value of the options, consistent with applicable tax law, to reflect
special cash dividends of $4.32 per share paid on June 30, 2006 and $1.12 per share paid on
November 21, 2006. These remaining costs are expected to be recognized over the remaining 1.3 years,
on a weighted average basis, of the requisite service period that began on the grant dates.
Employee Stock Purchase Plan
On February 28, 2008, upon recommendation of the compensation committee of our Board of Directors,
or ‘‘Committee,’’ our Board of Directors adopted the Hertz Global Holdings, Inc. Employee Stock
Purchase Plan, or the ‘‘ESPP,’’ and the plan was approved by our stockholders on May 15, 2008. The
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