Lowe's 2013 Annual Report Download - page 59

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51
Transactions related to restricted stock awards for the year ended January 31, 2014 are summarized as follows:
Shares
(In thousands)
Weighted-Average
Grant-Date Fair
Value Per Share
Nonvested at February 1, 2013
7,134
$
25.72
Granted
2,928
41.78
Vested
(2,535
)
23.95
Canceled or forfeited
(479
)
29.91
Nonvested at January 31, 2014
7,048
$
32.74
Deferred Stock Units
Deferred stock units are valued at the market price of a share of the Company’s common stock on the date of grant. For non-
employee Directors, these awards vest immediately and are expensed on the grant date. During 2013, 2012 and 2011, each
non-employee Director was awarded a number of deferred stock units determined by dividing the annual award amount by the
fair market value of a share of the Company’s common stock on the award date and rounding up to the next 100 units. The
annual award amount used to determine the number of deferred stock units granted to each Director was $150,000 for 2013 and
$140,000 for both 2012 and 2011. During 2013, 36,000 deferred stock units were granted and immediately vested for non-
employee Directors. The weighted-average grant-date fair value per share of deferred stock units granted was $42.11, $26.36
and $24.25 in 2013, 2012 and 2011, respectively. The total fair value of deferred stock units vested was $1.5 million in 2013
and $1 million in 2012 and 2011. During 2013, no deferred stock units were released as a result of termination of service. At
January 31, 2014, there were 0.6 million deferred stock units outstanding, all of which were vested.
Performance Share Units
The Company has issued two types of Performance Share Units - those based on the achievement of targeted Company return
on non-cash average assets (RONCAA) and those based on targeted Company improvement in brand differentiation.
Performance share units do not have dividend rights. In general, upon the achievement of a minimum threshold, 50% to 150%
of these awards vest at the end of a three year service period from the date of grant based upon achievement of the performance
goal specified in the performance share unit agreement.
Performance share units are expensed on a straight-line basis over the requisite service period, based on the probability of
achieving the performance goal, with changes in expectations recognized as an adjustment to earnings in the period of the
change. If the performance goal is not met, no compensation cost is recognized and any previously recognized compensation
cost is reversed. The Company uses historical data to estimate the timing and amount of forfeitures.
RONCAA Awards
Performance share units issued based on the achievement of targeted RONCAA, which is considered a performance condition,
are classified as equity awards and are valued at the market price of a share of the Company’s common stock on the date of
grant less the present value of dividends expected during the requisite service period. The weighted-average grant-date fair
value per unit of performance share units classified as equity awards granted was $36.48, $26.60 and $25.13 in 2013, 2012 and
2011, respectively. No performance share units vested in 2013, 2012 or 2011.
Transactions related to performance share units classified as equity awards for the year ended January 31, 2014 are summarized
as follows: