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Shareholders' Equity | 12 Months Ended
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Dec. 31, 2012
Shareholders' Equity |
Shareholders' Equity | 7. Shareholders' Equity Dividends We declared cash dividends of $0.15 per share of common stock for 2012, 2011 and 2010. Our Credit Facility and Term Loans restrict the payment of cash dividends to a maximum of the sum of (i) $50.0 million plus (ii) 50% of the consolidated net income calculated quarterly for the previous four fiscal quarters plus (iii) 100% of the net proceeds of all equity issuances made after the closing date of the Credit Facility and Term Loans. The payment of the above-referenced dividends was in compliance with the Credit Facility and Term Loans. Issuance of Common Stock In September 2010, we completed a public offering of 9.2 million shares of our common stock at a price of $25.00 per share of common stock. We received net proceeds of $218.8 million from the offering, after deducting $10.4 million in commissions paid to the underwriters and an estimated $0.8 million in other expenses incurred in connection with the offering. Stock Repurchase Programs Our Board of Directors, from time to time, has authorized stock repurchase programs under the terms of which we may repurchase our common stock, subject to certain restrictions contained in our Credit Facility and Term Loans. We did not repurchase any shares of common stock under any stock repurchase program in 2012, 2011 or 2010. As of December 31, 2012, we have $50.0 million available to repurchase shares under our stock repurchase program. Non-Employee Director Stock Deferral Plan We adopted the 2003 Stock Deferral Plan for Non-Employee Directors (the "Stock Deferral Plan") to provide for deferral of stock grants. Under the Stock Deferral Plan, each non-employee director could elect to have any annual stock grants paid in stock units, in lieu of stock, with each stock unit being equivalent to one share of our common stock and deferred as provided in the Stock Deferral Plan. As of each cash dividend payment date with respect to our common stock, each participant in the Stock Deferral Plan has credited to his or her account, as maintained by us, a number of stock units equal to the quotient obtained by dividing: (a) the product of (i) the cash dividend payable with respect to each share of common stock on such date and (ii) the total number of stock units credited to his or her account as of the close of business on the record date applicable to such dividend payment date by (b) the fair market value of one share of common stock on such dividend payment date. Upon the participant's termination of service as our director for any reason, or upon a change of control, the participant will receive a number of shares of common stock equal to the number of stock units credited to his or her account. The estimated fair value of stock and stock units issued to non-employee directors under the Stock Deferral Plan is based on the market value of our common stock on the date of grant and recorded as non-employee director compensation expense. Outstanding stock units issued to non-employee directors under the Stock Deferral Plan are included as capital in excess of par value in shareholders' equity. There were 25,000 stock units outstanding as of December 31, 2012 and 2011. The aggregate carrying value of the outstanding stock units was $0.3 million as of December 31, 2012 and 2011, which is included in capital in excess of par value in the accompanying consolidated balance sheets. Share-Based Payment Plans Plan Summary and Description In 2006, our shareholders approved the 2006 Omnibus Plan (the "2006 Plan"). The 2006 Plan is administered by the Compensation Committee of the Board of Directors (the "Compensation Committee"). The purpose of the 2006 Plan is to (i) attract and retain persons eligible to participate in the 2006 Plan; (ii) motivate participants, by means of appropriate incentives, to achieve long-range goals; (iii) provide incentive compensation opportunities that are competitive with those of other similar companies; and (iv) further align participants' interests with those of our other shareholders through compensation that is based on the value of our common stock. The goal is to promote the long-term financial interest of World Fuel and its subsidiaries, including the growth in value of our equity and enhancement of long-term shareholder return. The persons eligible to receive awards under the 2006 Plan are our employees, officers, and members of the Board of Directors, or any consultant or other person who performs services for us. The provisions of the 2006 Plan authorize the grant of stock options which can be "qualified" or "nonqualified" under the Internal Revenue Code of 1986, as amended, restricted stock, RSUs, SSAR Awards, performance shares and performance units and other share- based awards. The 2006 Plan is unlimited in duration and, in the event of its termination, the 2006 Plan will remain in effect as long as any of the above awards are outstanding. No awards may be granted under the 2006 Plan after June 2016. The term and vesting period of awards granted under the 2006 Plan are established on a per grant basis, but options and SSAR Awards may not remain exercisable after the seven-year anniversary of the date of grant. Under the 2006 Plan, 4,900,000 shares of common stock are authorized for issuance. Additional shares of common stock that are authorized for issuance under the 2006 Plan include any shares that were available for future grant under any of our prior stock plans, and any stock or stock options granted under the 2006 Plan or any prior plans that expire or are forfeited or canceled. Furthermore, any employee's shares used to satisfy the withholding taxes due upon vesting of restricted stock or RSUs or exercise of SSAR Awards are added to the maximum number of shares authorized for issuance under the 2006 Plan. The following table summarizes the outstanding awards issued pursuant to the 2006 Plan described above as of December 31, 2012 and the remaining shares of common stock available for future issuance (in thousands):
Plan name |  | Restricted Stock |  | RSUs |  | SSAR Awards |  | Remaining shares of common stock available for future issuance
--- | --- | --- | --- | --- | --- | --- | --- | ---
2006 Plan (1) |  | 1,100 |  | 981 |  | 422 |  | 3,824
(1) As of December 31, 2012, unvested restricted stock will vest between March 2013 and March 2018, unvested RSUs will vest between January 2013 and May 2017 and the outstanding SSAR Awards will expire between March 2013 and October 2015. RSUs granted to non-employee directors under the 2006 Plan prior to 2011 remain outstanding until the date the non-employee director ceases, for any reason, to be a member of the Board of Directors. Restricted Stock Awards The following table summarizes the status of our unvested restricted stock outstanding and related transactions for each of the following years (in thousands, except weighted average grant-date fair value price and weighted average remaining vesting term data):
Unvested Restricted Stock Outstanding |
--- | ---
|  | Unvested Restricted Stock |  | Weighted Average Grant-date Fair Value Price |  | Aggregate Intrinsic Value |  | Weighted Average Remaining Vesting Term (in Years) |
As of December 31, 2009 |  | 419 |  | $ | 20.88 |  | $ | 11,245 |  |  | 1.7 |
Vested |  | (26) |  |  | 21.30 |  |  |  |  |  |  |
Forfeited |  | (7) |  |  | 20.95 |  |  |  |  |  |  |
As of December 31, 2010 |  | 386 |  |  | 20.84 |  |  | 13,991 |  |  | 0.6 |
Granted |  | 353 |  |  | 37.40 |  |  |  |  |  |  |
Vested |  | (284) |  |  | 20.49 |  |  |  |  |  |  |
Forfeited |  | (9) |  |  | 26.45 |  |  |  |  |  |  |
As of December 31, 2011 |  | 446 |  |  | 34.07 |  |  | 18,707 |  |  | 2.2 |
Granted |  | 798 |  |  | 40.19 |  |  |  |  |  |  |
Vested |  | (128) |  |  | 26.26 |  |  |  |  |  |  |
Forfeited |  | (16) |  |  | 37.24 |  |  |  |  |  |  |
As of December 31, 2012 |  | 1,100 |  | $ | 39.38 |  | $ | 45,295 |  |  | 3.4 |
The aggregate value of restricted stock which vested during 2012, 2011 and 2010 was $5.3 million, $10.6 million and $0.7 million, respectively, based on the average high and low market price of our common stock at the vesting date. RSU Awards The following table summarizes the status of our RSUs and related transactions for each of the following years (in thousands, except for weighted average grant-date fair value data and weighted average remaining contractual life):
RSUs Outstanding |
--- | ---
|  | RSUs |  | Weighted Average Grant-date Fair Value |  | Aggregate Intrinsic Value |  | Weighted Average Remaining Contractual Life (in Years) |
As of December 31, 2009 |  | 901 |  | $ | 14.52 |  | $ | 24,131 |  |  | 2.5 |
Granted |  | 343 |  |  | 28.32 |  |  |  |  |  |  |
Issued |  | (11) |  |  | 14.03 |  |  |  |  |  |  |
Forfeited |  | (15) |  |  | 19.91 |  |  |  |  |  |  |
As of December 31, 2010 |  | 1,218 |  |  | 18.34 |  |  | 44,038 |  |  | 2.6 |
Granted |  | 224 |  |  | 38.01 |  |  |  |  |  |  |
Issued |  | (515) |  |  | 14.03 |  |  |  |  |  |  |
Forfeited |  | (26) |  |  | 16.19 |  |  |  |  |  |  |
As of December 31, 2011 |  | 901 |  |  | 25.59 |  |  | 37,373 |  |  | 1.7 |
Granted |  | 369 |  |  | 40.98 |  |  |  |  |  |  |
Issued |  | (275) |  |  | 16.12 |  |  |  |  |  |  |
Forfeited |  | (14) |  |  | 30.74 |  |  |  |  |  |  |
As of December 31, 2012 |  | 981 |  | $ | 34.06 |  | $ | 39,888 |  |  | 1.5 |
The aggregate intrinsic value of RSUs issued during 2012, 2011 and 2010 was $11.6 million, $19.5 million and $0.3 million, respectively. SSAR Awards The following table summarizes the status of our outstanding and exercisable SSAR Awards and related transactions for each of the following years (in thousands, except weighted average exercise price and weighted average remaining contractual life data):
|  | SSAR Awards Outstanding |  | SSAR Awards Exercisable |
--- | --- | --- | --- | --- | ---
|  | SSAR Awards |  | Weighted Average Exercise Price |  | Aggregate Intrinsic Value |  | Weighted Average Remaining Contractual Life (in Years) |  | SSAR Awards |  | Weighted Average Exercise Price |  | Aggregate Intrinsic Value |  | Weighted Average Remaining Contractual Life (in Years) |
As of December 31, 2009 |  |  | 2,061 |  | $ | 16.70 |  | $ | 20,914 |  |  | 2.1 |  |  | 1,419 |  | $ | 17.62 |  | $ | 13,109 |  |  | 1.6 |
Granted |  |  | 36 |  |  | 24.89 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Exercised |  |  | (1,085) |  |  | 17.52 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
As of December 31, 2010 |  |  | 1,012 |  |  | 16.10 |  |  | 20,346 |  |  | 1.9 |  |  | 480 |  |  | 18.29 |  |  | 8,619 |  |  | 1.3 |
Exercised |  |  | (486) |  |  | 16.56 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Forfeited |  |  | (9) |  |  | 12.39 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
As of December 31, 2011 |  |  | 517 |  |  | 15.06 |  |  | 13,921 |  |  | 1.4 |  |  | 410 |  |  | 15.39 |  |  | 10,895 |  |  | 1.4 |
Exercised |  |  | (95) |  |  | 16.76 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
As of December 31, 2012 |  |  | 422 |  | $ | 15.30 |  | $ | 10,927 |  |  | 0.6 |  |  | 322 |  | $ | 16.02 |  | $ | 8,108 |  |  | 0.7 |
The aggregate intrinsic value of SSAR Awards exercised during 2012, 2011 and 2010 was $2.1 million, $10.2 million and $13.2 million, respectively, based on the difference between the average of the high and low market price of our common stock at the exercise date and the SSAR Award exercise price. As discussed in Note 1, we currently use the Black-Scholes option pricing model to estimate the fair value of SSAR Awards granted to employees and non-employee directors. There were no SSAR Awards issued in 2012 and 2011. The weighted average fair value of the SSAR Awards for 2010 was $10.97 and the assumptions used to determine such fair value were as follows: expected term of 4.0 years, volatility of 58.0%, dividend yields of 0.5% and risk-free interest rates of 1.7%. Unrecognized Compensation Cost As of December 31, 2012, there was $33.2 million of total unrecognized compensation cost related to unvested share-based payment awards, which is included as capital in excess of par value in the accompanying consolidated balance sheets. The unrecognized compensation cost as of December 31, 2012 is expected to be recognized as compensation expense over a weighted average period of 1.5 years as follows (in thousands):
Year Ended December 31, |  |  |
--- | --- | --- | ---
2013 |  | $ | 13,791 |
2014 |  |  | 10,706 |
2015 |  |  | 5,392 |
2016 |  |  | 2,680 |
2017 |  |  | 640 |
|  | $ | 33,209 |
Other Comprehensive Loss and Accumulated Other Comprehensive Loss As of December 31, 2012 and 2011, our accumulated other comprehensive loss amounted to $16.0 million and $6.5 million, respectively. Our other comprehensive loss consists of foreign currency translation adjustments related to our subsidiaries that have a functional currency other than the U.S. dollar and gains relating to cash flow hedges. Our foreign currency translation adjustments amounted to losses of $9.6 million and $11.3 million in 2012 and 2011, respectively, and a net foreign currency translation adjustment gain of $1.0 million in 2010. The foreign currency translation adjustment losses for 2012 and 2011 were primarily due to the strengthening of the U.S. dollar as compared to the Brazilian Real. We recorded gains of $0.1 million on our cash flow hedges in 2012.

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- Definition The entire disclosure for shareholders' equity, comprised of portions attributable to the parent entity and noncontrolling interest, if any, including other comprehensive income (as applicable). Including, but not limited to: (1) balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings; (2) accumulated balance for each classification of other comprehensive income and total amount of comprehensive income; (3) amount and nature of changes in separate accounts, including the number of shares authorized and outstanding, number of shares issued upon exercise and conversion, and for other comprehensive income, the adjustments for reclassifications to net income; (4) rights and privileges of each class of stock authorized; (5) basis of treasury stock, if other than cost, and amounts paid and accounting treatment for treasury stock purchased significantly in excess of market; (6) dividends paid or payable per share and in the aggregate for each class of stock for each period presented; (7) dividend restrictions and accumulated preferred dividends in arrears (in aggregate and per share amount); (8) retained earnings appropriations or restrictions, such as dividend restrictions; (9) impact of change in accounting principle, initial adoption of new accounting principle and correction of an error in previously issued financial statements; (10) shares held in trust for Employee Stock Ownership Plan (ESOP); (11) deferred compensation related to issuance of capital stock; (12) note received for issuance of stock; (13) unamortized discount on shares; (14) description, terms, and number of warrants or rights outstanding; (15) shares under subscription and subscription receivables, effective date of new retained earnings after quasi-reorganization and deficit eliminated by quasi-reorganization and, for a period of at least ten years after the effective date, the point in time from which the new retained dates; and (16) retroactive effective of subsequent change in capital structure. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 04 -Article 3 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21488-112644 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 02 -Paragraph 29, 30, 31 -Article 5 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Staff Accounting Bulletin (SAB) -Number Topic 4 -Section E Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Glossary Preferred Stock -URI http://asc.fasb.org/extlink&oid=6521494 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 11 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21564-112644 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section S99 -Paragraph 4 -Subparagraph (SAB TOPIC 4.C) -URI http://asc.fasb.org/extlink&oid=6959260&loc=d3e187143-122770 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21484-112644 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644 Reference 10: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 6 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21506-112644 Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 30 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6405834&loc=d3e23285-112656 Reference 12: http://www.xbrl.org/2003/role/presentationRef -Publisher AICPA -Name Accounting Research Bulletin (ARB) -Number 43 -Section B -Paragraph 7, 11A -Chapter 1 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. 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