Long-Term Performance Awards Continue to Grow in Prevalence - PlanSponsor.com - 12 Oct 2009

According to the report, performance shares remain the only grant type significantly growing in use.

Stock options remain the most
widely used long-term incentive grant type among companies in the Top
250. Seventy-seven percent of the Top 250 companies grant stock
options. Five of the Top 250 companies that used stock options in the
past dropped options from their long-term incentive programs this year
or expect to do so next year - continuing the steady decline in stock
option usage from a high of 99% from 1999 through 2003.

Seven percent of companies in
the Top 250 currently grant stock appreciation rights (SARs), compared
to 5% in the 2006 report. The report explained that since the 1990s,
SARs were rarely granted due to their unfavorable accounting treatment,
but that was eliminated under FAS 123.

Fifty-seven percent of the Top
250 companies grant or have begun to grant restricted stock in the last
year - excluding companies that use restricted stock grants only in
hiring situations or as one-time awards under special circumstances.
Restricted stock usage declined this year accompanied by an increase in
the usage of performance shares.

Fifty-seven percent of the Top
250 companies have historically granted performance shares, which,
according to the report, consist of stock-denominated shares earned
based on performance over a predefined performance period. Six percent
began to grant performance shares during the latest fiscal year or are
planning to do so in the next year - resulting in total performance
share prevalence of 63%, according to the report.

Eighteen percent of the
Top 250 companies granted or have begun to grant performance units -
grants of cash or dollar-denominated "units" which are earned based on
performance against predetermined objectives over a pre-defined
performance period and may be paid out in cash or stock - in the last
year. Though the use of performance units has been relatively flat
since the 2006 report, ten of the Top 250 companies dropped performance
units from their LTI programs this year or expect to do so next year.