Windstream 2006 Annual Report Download - page 159

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
9. Stock-Based Compensation Plans, Continued:
Non-vested Windstream restricted stock activity for the year ended December 31, 2006 was as follows:
(Thousands)
Number of
Shares
Weighted Average
Fair Value Per Share
Non-vested at July 17, 2006 - $ -
Granted 3,156.3 12.60
Assumed from Valor acquisition 186.3 11.50
Vested (42.6) 11.50
Forfeited (56.8) 12.42
Non-vested at December 31, 2006 3,243.2 $12.55
At December 31, 2006, unrecognized compensation expense for the Windstream restricted shares granted on
August 2, 2006 amounted to $34.2 million. The unrecognized compensation expense for these non-vested
restricted shares at December 31, 2006 has a remaining weighted average vesting period of 2.6 years. At
December 31, 2006, unrecognized compensation expense for the Valor restricted shares assumed amounted to $0.6
million and has a remaining weighted average vesting period of one year.
Set forth below is certain information related to stock options outstanding under Alltel’s stock-based compensation
plans relating to the Company’s employees:
(Thousands) Weighted
Average Price
Per Share
Number of
Shares
Outstanding at December 31, 2005 2,846.9 $58.83
Granted --
Exercised (689.7) 55.44
Forfeited (733.6) 53.46
Transfers, net (53.3) 54.31
Outstanding at July 17, 2006 1,370.3 63.60
Re-pricing due to separation from Alltel 304.2 52.05
Exercised (1,646.2) 52.48
Forfeited (28.3) 48.00
Outstanding at December 31, 2006 - $ -
The amounts reflected in the table above represent stock options held by those employees that were known to be
wireline division employees as of the date of spin, July 17, 2006. Amounts reflected as Transfers, net in the table
above represent options held by employees that transferred between the wireless and wireline divisions of Alltel
between December 31, 2005 and July 17, 2006. Upon spin, all employees of the Company terminated their
employment with Alltel, and therefore forfeited any unvested stock options. All vested stock options were required
to be exercised within ninety days of termination pursuant to the plan provisions. Because the unvested stock
options were forfeited prior to vesting, pursuant to the guidance in SFAS No. 123(R), any expense previously
recognized related to those options was reversed. As a result, during the third quarter of 2006, the Company
recorded a reduction in stock-based compensation expense of $1.0 million. The total intrinsic value of stock
options exercised during the twelve months ended December 31, 2006 was $13.9 million. Alltel received $127.8
million in cash from the exercise of stock options by employees of the Company during 2006.
F-58