Long-Term Incentive Plan Units

12 Months Ended

Dec. 31, 2012

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Long-Term Incentive Plan Units

Long-Term Incentive Plan Units

In connection with its initial offering in 2007, the Company established the Manager Long-Term Incentive Plan (the “Manager LTIP”) and the Individual Long-Term Incentive Plan (the “Individual LTIP”). Pursuant to the terms of the Manager LTIP, the Company issued 375,000 long-term incentive plan units to its Manager. Pursuant to the terms of the Individual LTIP, each year since inception the Company has issued annual awards to its independent directors and, beginning in 2010, issued awards to certain of its dedicated personnel.

As of August 17, 2010, LTIP units awarded to the Manager were fully vested and expensed. LTIP units held pursuant to the Manager LTIP are generally exercisable by the holder at any time after vesting. Each LTIP unit is convertible into one common share. There is no cash flow effect from the issuance of the Manager LTIP units. Since inception, the aggregate expense associated with the Manager LTIP was $8.6 million.

Since inception, the Company has awarded 24,096 Individual LTIP units to the Company’s independent directors, including 5,346 Individual LTIP units granted on September 12, 2012, and 8,000 Individual LTIP units to certain of its dedicated personnel, including 2,500 Individual LTIP units granted on December 12, 2012. The vesting period for awards issued under the Individual LTIP units has generally been one year from the date of grant. Units held pursuant to the Individual LTIPs are generally exercisable by the holder at any time after vesting. Each unit is convertible into one common share. Costs associated with the Individual LTIPs are measured as of the grant date and expensed ratably over the vesting period. Since inception the total expense associated with the Individual LTIP units awarded is $0.5 million. Total expense associated with Individual LTIPs for the years ended December 31, 2012, 2011, and 2010 are $0.14 million, $0.15 million, and $0.10 million respectively. Since inception, 10,000 common shares were issued in connection with the conversion of Individual LTIP units awarded to independent directors at the direction of the three award holders and $0.2 million was transferred from the share-based LTIP awards to common shares in shareholders’ equity.

If all of the LTIP units that have previously been issued were to be fully vested and exchanged for common shares as of December 31, 2012, 2011, and 2010, the Company’s issued and outstanding common shares would increase to 20,767,565, 16,838,151, and 16,883,342 shares, respectively, resulting in shareholders’ equity per share of $24.38, $22.03, and $23.91, at December 31, 2012, 2011, and 2010, respectively.

Detailed below is a roll-forward of the Company’s LTIP units outstanding for the years ended December 31, 2012, 2011, and 2010:

	Year Ended December 31, 2012					Year Ended December 31, 2011					Year Ended December 31, 2010
	Manager	Director/ Employee		Total		Manager	Director/ Employee		Total		Manager	Director/ Employee		Total
LTIP Units Outstanding (12/31/2011, 12/31/2010, and 12/31/2009, respectively)	375,000	15,500		390,500		375,000	10,000		385,000		375,000	7,500		382,500
Granted	—	7,846		7,846		—	6,750		6,750		—	6,250		6,250
Exercised	—	(1,250	)	(1,250	)	—	(1,250	)	(1,250	)	—	(3,750	)	(3,750	)
LTIP Units Outstanding(12/31/2012, 12/31/2011, and 12/31/2010, respectively)	375,000	22,096		397,096		375,000	15,500		390,500		375,000	10,000		385,000
LTIP Units Vested and Outstanding (12/31/2012, 12/31/2011, and 12/31/2010, respectively)	375,000	14,250		389,250		375,000	8,750		383,750		375,000	3,750		378,750