Mercury Insurance 2009 Annual Report Download - page 113

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MERCURY GENERAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The following table summarizes information regarding stock options outstanding at December 31, 2009:
Options Outstanding Options Exercisable
Range of Exercise Prices
Number of
Options
Weighted Avg.
Remaining
Contractual Life
(Years)
Weighted
Avg. Exercise
Price
Number of
Options
Weighted
Avg. Exercise
Price
$22.06-29.77 ......................... 11,000 0.3 $25.28 11,000 $25.28
$33.88-58.83 ......................... 679,200 6.6 $44.57 325,200 $47.81
As of December 31, 2009, $1,367,000 of total unrecognized compensation cost related to non-vested stock
options is expected to be recognized over a weighted-average period of 1.8 years.
16. Earnings Per Share
A reconciliation of the numerators and denominators of the basic and diluted earnings per share calculation
for income (loss) from operations is presented below:
2009 2008 2007
Income
(Numerator)
Weighted
Shares
(Denominator)
Per-Share
Amount
Loss
(Numerator)
Weighted
Shares
(Denominator)
Per-Share
Amount
Income
(Numerator)
Weighted
Shares
(Denominator)
Per-Share
Amount
(Amounts in thousands, except per share data)
Basic EPS
Income (Loss)
available to
common
stockholders .... $403,072 54,770 $7.36 $(242,119) 54,744 $(4.42) $237,832 54,704 $4.35
Effect of dilutive
securities:
Options .......... — 322 — 173 — 125
Diluted EPS
Income (Loss)
available to
common
stockholders after
assumed
conversions .... $403,072 55,092 $7.32 $(242,119) 54,917 $(4.42) $237,832 54,829 $4.34
The antidilutive impact of incremental shares is excluded from loss position in 2008 in accordance with
GAAP.
The diluted weighted shares exclude incremental shares of 685,000, 305,000, and 88,000 for 2009, 2008,
and 2007, respectively. These shares are excluded due to their antidilutive effect.
17. Commitments and Contingencies
Operating Leases
The Company is obligated under various non-cancellable lease agreements providing for office space and
equipment rental that expire at various dates through the year 2019. For leases that contain predetermined
escalations of the minimum rentals, the Company recognizes the related rent expense on a straight-line basis and
records the difference between the recognized rental expense and amounts payable under the leases as deferred
rent in other liabilities. This liability amounted to approximately $1,452,000 and $1,426,000 at December 31,
2009 and 2008, respectively. Total rent expense under these lease agreements was $17,529,000, $12,002,000, and
$9,469,000 for 2009, 2008, and 2007, respectively.
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