(9) STOCK OPTION AND INCENTIVE PLANS

We sponsor several share-based employee incentive plans. Share-based compensation expense for grants awarded under these plans was $37 million, $29 million and $27 million in 2011, 2010, and 2009, respectively. Related income tax benefits recognized in earnings were $13 million, $10 million and $10 million in 2011, 2010, and 2009, respectively.

At December 31, 2011, unrecognized compensation cost related to non-vested stock option and stock unit awards totaled $39 million. The cost of these non-vested awards is expected to be recognized over a weighted-average remaining vesting period of 34 months.

Share-Based Employee Incentive Plans

On April 20, 2010, our stockholders approved the 2010 Omnibus Stock and Incentive Plan (“2010 OSIP”). This plan was previously adopted by our Board of Directors on February 16, 2010 and provides for the issuance of stock options, performance stock units, performance shares, restricted stock and restricted stock units. No new awards may be granted under the 2010 OSIP after the tenth anniversary of the date that the stockholders approved the plan. However, the term and exercise of awards granted before then may extend beyond that date. At December 31, 2011, approximately 3.2 million shares remain available for issuance under the 2010 OSIP.

On April 17, 2007, our stockholders approved the 2007 Omnibus Stock and Incentive Plan (“2007 OSIP”). This plan was previously adopted by our Board of Directors on February 20, 2007 and provides for the issuance of stock options, performance stock units, performance shares, restricted stock and restricted stock units with terms of no more than 10 years. At December 31, 2010, no shares remain available for issuance under the 2007 OSIP.

Stock Options

Eligible employees may receive stock options as a portion of their total compensation. Such options generally become exercisable over a three-year period, expire 10 years from the date of grant and are subject to forfeiture upon termination of employment, other than by death, disability or retirement. We use the Black-Scholes option-pricing model to measure the fair value of stock options granted to employees. Granted options have exercise prices equal to the market price of Whirlpool common stock on the grant date. The principal assumptions used in valuing options include: (1) risk-free interest rate—an estimate based on the yield of United States zero coupon securities with a maturity equal to the expected life of the option; (2) expected volatility—an estimate based on the historical volatility of Whirlpool common stock for a period equal to the expected life of the option; and (3) expected option life—an estimate based on historical experience. Stock options are expensed on a straight-line basis, net of estimated forfeitures. Based on the results of the model, the weighted-average fair values of stock options granted for 2011, 2010, and 2009 were $24.74, $36.84 and $6.42, respectively, using the following assumptions:



Weighted Average Black-Scholes Assumptions	2011		2010		2009
Risk-free interest rate	2.3	%	3.3	%	1.9	%
Expected volatility	36.5	%	40.3	%	37.5	%
Expected dividend yield	2.0	%	1.8	%	5.5	%
Expected option life, in years	5		7		5

Stock Option Activity

The following table summarizes stock option activity during 2011:



Thousands of shares, except per share data	Number of Options		Weighted- Average Exercise Price
Outstanding at January 1	3,428		$	71.20
Granted	625		85.46
Exercised	(244	)	46.63
Canceled or expired	(346	)	120.64
Outstanding at December 31	3,463		$	70.63
Exercisable at December 31	2,484		$	73.10

The total intrinsic value of stock options exercised was $9 million, $40 million, and $9 million for 2011, 2010, and 2009, respectively. The related tax benefits were $3 million, $14 million and $3 million for 2011, 2010, and 2009, respectively. Cash received from the exercise of stock options was $14 million, $72 million, and $21 million for 2011, 2010, and 2009, respectively.

The table below summarizes additional information related to stock options outstanding at December 31, 2011:



Options in thousands / dollars in millions, except share data	Outstanding Net of Expected Forfeitures		Options Exercisable
Number of options	3,389		2,484
Weighted-average exercise price per share	$	70.30	$	73.10
Aggregate intrinsic value	$	16	$	10
Weighted-average remaining contractual term, in years	6		5

Stock Units

Eligible employees may receive restricted stock units or performance stock units as a portion of their total compensation.

Restricted stock units are typically granted to selected management employees on an annual basis and vest over three years. Periodically, restricted stock units may be granted to selected executives based on special recognition or retention circumstances and generally vest from three years to seven years. Some of these awards accrue dividend equivalents on outstanding units (in the form of additional stock units) based on dividends declared on Whirlpool common stock. These awards convert to unrestricted common stock at the conclusion of the vesting period.

Performance stock units are granted to executives on an annual basis. The final award may equal 0 – 200% of a target based on pre-established Whirlpool financial performance measures related to the current year. The awards vest two years following the end of the performance period and convert to unrestricted common stock at the conclusion of the vesting period. The total fair value of shares vested during 2011, 2010, and 2009 was $15 million, $17 million and $15 million, respectively.

We measure compensation cost for stock units based on the closing market price of Whirlpool common stock at the grant date. The weighted average grant date fair values of awards granted during 2011, 2010, and 2009 were $82.55, $87.17 and $26.51, respectively.

The following table summarizes stock unit activity during 2011:



Stock units in thousands, except per-share data	Number of Stock Units		Weighted- Average Grant Date Fair Value
Non-vested, at January 1	1,486		$	60.60
Granted	297		82.55
Canceled	(66	)	70.07
Vested and transferred to unrestricted	(243	)	63.03
Non-vested, at December 31	1,474		$	64.32

Nonemployee Director Equity Awards

Effective January 1, 2011, each nonemployee Director will receive an annual grant of Whirlpool common stock, with the number of shares to be issued to the director determined by dividing $110,000 by the closing price of Whirlpool common stock on the date of the annual meeting of our stockholders. Nonemployee Directors receive a one time grant of 1,000 shares of Whirlpool common stock made at the time they first join the Board.

Prior to 2011, each nonemployee Director received the following equity compensation (1) a one time grant of 1,000 shares of Whirlpool common stock made at the time a director first joins the Board; (2) an annual grant of stock options, with the number of options to be determined by dividing $50,000 by the fair value of the stock option granted, as calculated using the Black-Scholes valuation model; and (3) an annual grant of stock, with the number of shares to be issued to the director determined by dividing $50,000 by the closing price of Whirlpool common stock on the date of the annual meeting of our stockholders. The exercise price under each option granted is the closing price of Whirlpool common stock on the day of Whirlpool's annual meeting of stockholders.