Rue 21 2011 Annual Report Download - page 55

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rue21, inc. and subsidiary
Notes to Consolidated Financial Statements — (continued)
(3) Represents the period of time options are expected to be outstanding. The weighted-average expected option
term was determined using the “simplified method”, as allowed by Staff Accounting Bulletin Topic 14. The
expected term used to value a share option grant under the simplified method is the midpoint between the
vesting date and the contractual term of the share option.
The following table summarizes information regarding non-vested outstanding stock options as of January 28,
2012:
Shares
Weighted
Averaged Fair Value
at Grant Date
(in thousands) (per share)
Non-vested as of January 29, 2011 ........................... 881 $11.16
Granted ................................................. 298 16.13
Vested .................................................. (317) 8.48
Cancelled ............................................... (52) 13.82
Non-vested as of January 28, 2012 ........................... 810 $14.20
As of January 28, 2012, there was $11,503 of unrecognized compensation expense related to non-vested stock
option awards that is expected to be recognized over a weighted-average period of 1.18 years. The total fair value of
shares vested during the fiscal years 2011, 2010, and 2009, was $2,720, $835 and $5,312, respectively.
Restricted Stock Activity
Below is a summary of restricted stock unit activity for the year ended January 28, 2012:
Restricted Stock Units
Number of
Shares
Weighted-Average
Grant Date
Fair Value
(in thousands) (per share)
Non-vested at January 29, 2011 ............................... 25 $30.49
Granted .................................................. 150 29.69
Vested ................................................... (9) 30.47
Forfeited ................................................. (4) 30.12
Non-vested at January 28, 2012 ............................... 162 $29.85
The total fair value of restricted stock units granted during the fifty-two week period ended January 28, 2012,
was $4.4 million. As of January 28, 2012, there was $4.8 million of total unrecognized compensation cost related to
non-vested restricted stock units. The unrecognized cost is expected to be recognized over a weighted-average
period of 1.3 years.
Note 6 — Lease Commitments
All of the Company’s operations are conducted from leased premises. Store leases provide for base rentals,
some of which increase over time, and the payment of a percentage of sales as additional rent when sales exceed
specified levels; the latter, providing the basis upon which material contingent rental payments are determined.
Minimum rentals relating to these leases are recorded on a straight-line basis. Generally, lease terms are five to ten
years in length excluding renewal options. In addition, the Company is typically responsible under its leases for
maintenance, common area charges, real estate taxes, and certain other expenses. Point of sale equipment is also
leased by the Company for a term of four years. All leases are classified as operating leases.
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