World Fuel Services 2002 Annual Report Download - page 64

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The fair value of each stock option granted was estimated using the Black-Scholes option pricing model. The following
table summarizes the weighted average fair value of the stock options granted for each of the following periods and the
related weighted average assumptions:
For the Nine Months
Ended December 31, For the Year Ended March 31,
2002 2001 2002 2001 2000
Fair-value of stock option 2.66$ 2.36$ 2.36$ 2.12$ 2.48$
Expected life (in years) 2.86 4.00 4.00 4.00 4.00
Dividend yields 1.39% 2.16% 2.16% 1.74% 1.45%
Risk-free interest rates 2.47% 4.13% 4.13% 5.04% 5.06%
Volatility 18.80% 20.00% 20.00% 20.00% 20.00%
Restricted Common Stock
Beginning in October 2001, under the 2001 Omnibus Plan, we started granting shares of restricted common stock to our
employees. The fair value of the restricted stock, based on the market value of our common stock on the date of grant, is
recorded as Unearned deferred compensation and is being amortized over the minimum vesting period of each individual
stock grant. In October 2001, we granted 25 thousand shares at a value of $298 thousand and recorded amortization for
employee compensation expense of $182 thousand for the year ended March 31, 2002, of which $39 thousand was recorded
for the nine months ended December 31, 2001. During the nine months ended December 31, 2002, we granted 96 thousand
restricted shares at an aggregate value of $1.9 million and recorded amortization of $304 thousand for employee
compensation cost. As of December 31, 2002, the unearned deferred compensation for restricted common stock to our
employees was approximately $1.7 million. At December 31, 2002, there were 115 thousand shares of unvested restricted
stock, which will vest between October 2003 and September 2007.
Warrant
In July 2000, we granted a warrant to an investment-banking firm in connection with the engagement of such firm to
provide advisory services to us. The warrant entitles the holder to purchase up to 50,000 shares of our common stock at an
exercise price of $9.50 per share, for a period of three years. In accordance with EITF Issue No. 96-18, “Accounting for
Equity Instruments That Are Issued through Other Than Employees for Acquiring, or in Conjunction with Selling, Goods or
Services,” we determined the fair value of this warrant to be approximately $60 thousand based on the Black-Scholes option-
pricing model. In October 2000, we terminated our relationship with the investment-banking firm. Accordingly, we
expensed the entire estimated value of this warrant during the year ended March 31, 2001. This warrant expires in July
2003.
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