Office Depot 2012 Annual Report Download - page 80

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OFFICE DEPOT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
As of December 29, 2012, there was approximately $10.1 million of total unrecognized compensation cost related to nonvested
restricted stock. This expense, net of forfeitures, is expected to be recognized over a weighted-average period of approximately 2
years. Of the 5.5 million unvested shares at year end, the Company estimates that 5.0 million shares will vest. The total grant date fai
r
value of shares vested during 2012 was approximately $2.4 million.
Performance-Based Incentive Program
During 2012, the Company implemented a performance-based long-term incentive program consisting of performance stock units and
performance cash. Payouts under this program are based on achievement of certain financial targets set by the Board of Directors, and
are subject to additional service vesting requirements, generally of three years from the grant date. In total, 2.1 million performance
stock units were granted under the program. Based on 2012 performance, 1.0 million shares were earned and will be subject to the
vesting requirements; all remaining shares were forfeited.
The Company also granted $15.0 million in performance cash under the program described above. Based on 2012 performance, $5.6
million was considered earned and the remaining $9.4 million was forfeited. The vesting of the performance cash is identical to the
vesting for the performance stock units discussed above.
Long-Term Incentive Cash Plan
During 2012, certain of the Company’s employees were eligible to receive time-vested long-term incentive cash. Approximately $6
million was granted in March of 2012 with a three-year ratable vesting schedule. Awards vest on each of the first three anniversaries
following the grant date. As of December 29, 2012 there was approximately $5.5 million that remained outstanding.
Retirement Savings Plans
Eligible Company employees may participate in the Office Depot, Inc. Retirement Savings Plan (“401(k) Plan”), which was approved
by the Board of Directors. This plan allows those employees to contribute a percentage of their salary, commissions and bonuses in
accordance with plan limitations and provisions of Section 401(k) of the Internal Revenue Code. Company matching contributions
were suspended by the compensation and benefits committee of the Board of Directors during 2010. The committee reinstated the
Company matching provisions at 50% of the first 4% of an employee’s contributions, subject to the limits of the 401(k) Plan,
effective with the first pay period beginning in 2011. Matching contributions are invested in the same manner as the participants’ pre-
tax contributions. The 401(k) Plan also allows for a discretionary matching contribution in addition to the normal match contributions
if approved by the Board of Directors.
77
2012 2011 2010
Shares
Weighted
Average
Grant-
Date
Price
Shares
Weighted
Average
Grant-
Date
Price
Shares
Weighted
Average
Grant-
Date
Price
Nonvested at beginning of year
2,612,876
$3.96
496,059
$10.39
1,318,162
$13.21
Granted
4,018,253
3.26
2,890,943
3.96
173,387
8.01
Vested
(695,751)
3.45
(594,876)
9.00
(741,007)
14.19
Forfeited
(475,478)
3.79
(179,25
0
) 4.97
(254,483)
11.31
Nonvested at end of
y
ear
5,459,90
0
$3.52
2,612,876
$3.96
496,059
$10.39