Under Armour 2011 Annual Report Download - page 77

Download and view the complete annual report

Please find page 77 of the 2011 Under Armour annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 96

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96

million of unrecognized compensation expense expected to be recognized over a weighted average period of 1.9
years. This does not include any expense related to performance-based stock options or restricted stock units.
Refer to “Stock Options and “Restricted Stock and Restricted Stock Units” below for further information on
these awards.
Employee Stock Purchase Plan
The Company’s Employee Stock Purchase Plan (the “ESPP”) allows for the purchase of Class A Common
Stock by all eligible employees at a 15% discount from fair market value subject to certain limits as defined in
the ESPP. The maximum number of shares available under the ESPP is 1.0 million shares. During the years
ended December 31, 2011, 2010 and 2009, 30.0 thousand, 39.6 thousand and 59.8 thousand shares were
purchased under the ESPP, respectively.
Non-Employee Director Compensation Plan and Deferred Stock Unit Plan
The Company’s Non-Employee Director Compensation Plan (the “Director Compensation Plan”) provides
for cash compensation and equity awards to non-employee directors of the Company under the 2005 Plan.
Non-employee directors have the option to defer the value of their annual cash retainers as deferred stock units in
accordance with the Under Armour, Inc. Non-Employee Deferred Stock Unit Plan (the “DSU Plan”). Each new
non-employee director receives an award of restricted stock units upon the initial election to the Board of
Directors, with the units covering stock valued at $0.1 million on the grant date and vesting in three equal annual
installments. In addition, each non-employee director receives, following each annual stockholders’ meeting, a
grant under the 2005 Plan of restricted stock units covering stock valued at $75.0 thousand on the grant date.
Each award vests 100% on the date of the next annual stockholders’ meeting following the grant date.
The receipt of the shares otherwise deliverable upon vesting of the restricted stock units automatically
defers into deferred stock units under the DSU Plan. Under the DSU Plan each deferred stock unit represents the
Company’s obligation to issue one share of the Company’s Class A Common Stock with the shares delivered six
months following the termination of the director’s service.
Stock Options
The weighted average fair value of a stock option granted for the years ended December 31, 2011, 2010 and
2009 was $38.55, $16.71 and $7.79, respectively. The fair value of each stock option granted is estimated on the
date of grant using the Black-Scholes option-pricing model with the following weighted average assumptions:
Year Ended December 31,
2011 2010 2009
Risk-free interest rate 1.2% - 2.6% 1.6% - 3.1% 2.0% - 3.2%
Average expected life in years 6.25 6.25 - 7.0 5.0 - 6.5
Expected volatility 54.4% - 56.1% 55.2% - 55.8% 53.4% - 56.2%
Expected dividend yield 0% 0% 0%
67