Quarterly report pursuant to Section 13 or 15(d)

Share-Based Compensation

Share-Based Compensation
6 Months Ended
Jun. 30, 2011
Share-Based Compensation  
Share-Based Compensation

11.                               Share-Based Compensation


Performance Share Units (“PSUs”)


On March 3, 2011, our Board of Trustees granted 56,883 PSUs to executives.  The PSUs have a performance period beginning on the grant date and concluding on the earlier of March 2, 2014 or the date of: (1) termination by the Company without cause, death or disability of the executive or constructive discharge of the executive (collectively, “qualified termination”); or (2) a sale event.  The number of PSUs earned (“earned PSUs”) at the end of the performance period will be determined based on the percentile rank of the Company’s total shareholder return relative to a peer group of companies, as set forth in the following schedule:


Percentile Rank


Earned PSUs Payout %

75th or greater


200% of PSUs granted



100% of PSUs granted



50% of PSUs granted

Below 25th


0% of PSUs granted


If the percentile rank exceeds the 25th percentile and is between two of the percentile ranks set forth in the table above, then the percentage of the earned PSUs will be interpolated between the ranges set forth in the table above to reflect any performance between the listed percentiles.  At the end of the performance period, we, in settlement of the award, will issue a number of fully-vested common shares equal to the sum of:


·                  the number of earned PSUs in settlement of the award plan; plus

·                  the aggregate dividends that would have been paid with respect to the common shares issued in settlement of the earned PSUs through the date of settlement had such shares been issued on the grant date, divided by the share price on such settlement date, as defined under the terms of the agreement.


If a performance period ends due to a sale event or qualified termination, the number of earned PSUs is prorated based on the portion of the three-year performance period that has elapsed.  If employment is terminated by the employee or by the Company for cause, all PSUs are forfeited.  PSUs do not carry voting rights.


We computed a grant date fair value of $49.15 per PSU using a Monte Carlo model, which included assumptions of, among other things, the following: baseline common share value of $35.17; expected volatility for our common shares of 61.1%; and risk-free interest rate of 1.32%.  We are recognizing the grant date fair value in connection with these PSU awards over a three-year period that commenced on March 3, 2011.


The PSUs granted to our executives on March 4, 2010, as described in our 2010 Annual Report on Form 10-K, were also outstanding at June 30, 2011.


Restricted Shares


During the six months ended June 30, 2011, certain employees as well as nonemployee members of our Board of Trustees were granted a total of 280,134 restricted shares with a weighted average grant date fair value of $35.30 per share.  Restricted shares granted to employees vest based on increments and over periods of time set forth under the terms of the respective awards provided that the employees remain employed by us.  The grants of restricted shares to nonemployee Trustees vest on the first anniversary of the grant date provided that the Trustee remains in his or her position.  During the six months ended June 30, 2011, forfeiture restrictions lapsed on 304,281 previously issued common shares; these shares had a weighted average grant date fair value of $32.56 per share, and the aggregate intrinsic value of the shares on the vesting dates was $10.8 million.




During the six months ended June 30, 2011, 180,464 options to purchase common shares (“options”) were exercised.  The weighted average exercise price of these options was $12.74 per share, and the aggregate intrinsic value of the options exercised was $3.9 million.