EQUITY COMPENSATION

9 Months Ended

Sep. 30, 2011

Notes to Financial Statements [Abstract]

7.	EQUITY COMPENSATION

Great Plains Energy’s Long-Term Incentive Plan is an equity compensation plan approved by Great Plains Energy’s shareholders. The Long-Term Incentive Plan permits the grant of restricted stock, stock options, limited stock appreciation rights, director shares, director deferred share units and performance shares to directors, officers and other employees of Great Plains Energy and KCP&L. Forfeiture rates are based on historical forfeitures and future expectations and are reevaluated annually.

The following table summarizes Great Plains Energy’s and KCP&L’s equity compensation expense and associated income tax benefits.


	Three Months Ended				Year to Date
	September 30				September 30
	2011		2010		2011		2010
Great Plains Energy	(millions)
Compensation expense	$	1.2	$	0.8	$	4.5	$	3.4
Income tax benefits		0.4		0.2		1.8		0.8
KCP&L
Compensation expense		0.8		0.6		3.1		2.4
Income tax benefits		0.2		0.2		1.2		0.4

Performance Shares

Performance share activity year to date September 30, 2011, is summarized in the following table.


	Performance			Grant Date
	Shares			Fair Value*
Beginning balance		431,784		$	18.01
Granted		140,128			26.15
Earned		(68,258	)		11.04
Forfeited		(61,612	)		22.38
Ending balance		442,042			21.06
* weighted-average

At September 30, 2011, the remaining weighted-average contractual term was 1.2 years. The weighted-average grant-date fair value of shares granted was $26.30 and $26.15 for the three months ended and year to date September 30, 2011, respectively. There were no shares granted for the three months ended September 30, 2010. The weighted-average grant-date fair value of shares granted year to date September 30, 2010, was $23.37. At September 30, 2011, there was $4.0 million of total unrecognized compensation expense, net of forfeiture rates, related to performance shares granted under the Long-Term Incentive Plan, which will be recognized over the remaining weighted-average contractual term. The total fair value of performance shares earned and paid year to date September 30, 2011 and 2010, was $0.8 million and insignificant, respectively.

The fair value of performance share awards is estimated using a Monte Carlo simulation technique that uses the closing stock price at the valuation date and incorporates assumptions for inputs of expected volatilities, dividend yield and risk-free rates. Expected volatility is based on daily stock price change during a historical period commensurate with the remaining term of the performance period of the grant. The risk-free rate is based upon the rate at the time of the evaluation for zero-coupon government bonds with a maturity consistent with the remaining performance period of the grant. The dividend yield is based on the most recent dividends paid and the actual closing stock price on the valuation date. For shares granted in 2011, inputs for expected volatility, dividend yield and risk-free rates ranged from 28%-30%, 3.98%-4.35%, and 0.61%-1.15%, respectively.

Restricted Stock

Restricted stock activity year to date September 30, 2011, is summarized in the following table.


	Nonvested
	Restricted			Grant Date
	Stock			Fair Value*
Beginning balance		406,657		$	16.23
Granted and issued		182,385			19.03
Vested		(149,688	)		17.29
Forfeited		(53,171	)		17.25
Ending balance		386,183			17.06
* weighted-average

At September 30, 2011, the remaining weighted-average contractual term was 1.6 years. The weighted-average grant-date fair value of shares granted for the three months ended and year to date September 30, 2011, was $17.89 and $19.03, respectively. The weighted-average grant-date fair value of shares granted for the three months ended and year to date September 30, 2010, was $18.32 and $17.80, respectively. At September 30, 2011, there was $3.4 million of total unrecognized compensation expense, net of forfeiture rates, related to nonvested restricted stock granted under the Long-Term Incentive Plan, which will be recognized over the remaining weighted-average contractual term. There were no shares vested for the three months ended September 30, 2011. The total fair value of shares vested year to date September 30, 2011, was $2.6 million. The total fair value of shares vested for the three months ended and year to date September 30, 2010, was $0.9 million and $7.3 million, respectively.