Sprint - Nextel 2006 Annual Report Download - page 104

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A summary of the status of the options under our option plans as of December 31, 2006, and changes during
the year ended December 31, 2006, is presented below:
Shares
Under
Option
Weighted
Average per
Share
Exercise
Price
Weighted
Average Remaining
Contractual Term
Aggregate
Intrinsic
Value
(in millions) (in years) (in millions)
Outstanding January 1, 2006 . . . .............. 199 $24.75
Granted .............................. 13 22.73
Exercised ............................. (29) 13.97
Forfeited/expired ....................... (29) 29.26
Adjustment pursuant to spin-off
(1)
........... 17
Outstanding December 31, 2006 .............. 171 $23.33 5.09 $378
Vested or expected to vest at December 31,
2006 ................................ 170 $23.34 5.07 $378
Exercisable at December 31, 2006 ............ 135 $24.52 4.31 $325
(1) The adjustment is a result of the Embarq spin-off described in note 2, which, net of cancellations,
increased the number of shares subject to options and decreased the exercise price for these shares. No
additional compensation expense related to the options resulted from this modification.
As of December 31, 2006, there was $257 million of total unrecognized compensation cost related to unvested
options and that cost is expected to be recognized over a weighted-average period of 1.72 years. The total
intrinsic value of options exercised was $264 million during 2006, $267 million during 2005 and $64 million
during 2004.
Restricted Stock Units
The fair value of each restricted stock unit award is calculated using the share price at the date of grant. A
summary of the status of the restricted stock units as of December 31, 2006 and changes during the year
ended December 31, 2006 is presented below. Restricted stock units consist of those units granted under the
1997 Program, as discussed above.
Future
Performance
and Service
Required
Future
Service
Required
Future
Performance
and Service
Required
Future
Service
Required
Restricted Stock Units
Weighted Average Grant
Date Fair Value of
Restricted Stock Units
(In thousands)
Outstanding January 1, 2006 ........................ — 8,618 $ — $18.64
Granted ..................................... 4,469 2,009 24.69 22.60
Vested ...................................... — (2,218) — 17.95
Forfeited ..................................... (310) (385) 24.69 22.72
Performance met
(1)
............................. (737) 737 24.69 24.69
Performance not met
(1)
.......................... (3,422) — 24.69 —
Outstanding December 31, 2006 ..................... — 8,761 — $19.14
(1) We evaluate performance conditions for restricted stock units at the end of the performance period.
Restricted stock units granted in 2006 that met the performance condition are categorized as performance
F-27
SPRINT NEXTEL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)