Windstream 2008 Annual Report Download - page 158

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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, 2008 was as follows:
(Thousands)
Number of
Shares
Weighted Average
Fair Value Per Share
Non-vested at December 31, 2007 3,098.8 $13.09
Granted 1,304.9 10.99
Vested (937.9) 13.07
Forfeited (113.0) 12.57
Non-vested at December 31, 2008 3,352.8 $12.30
At December 31, 2008, unrecognized compensation expense totaled to $14.4 million and is expected to be
recognized over the weighted average vesting period of 1.0 years. Unrecognized compensation expense is
included in additional paid-in capital in the accompanying consolidated balance sheets and statement of
shareholders’ equity. The total fair value of shares vested during the twelve months ended December 31, 2008,
2007 and 2006 was $12.3 million, $7.8 million and $0.5 million, respectively. Stock-based compensation expense
was $18.1 million, $15.9 million and $1.9 million for the twelve months ended December 31, 2008, 2007 and
2006, respectively.
In periods prior to 2006, employees that were known to be wireline division employees (“the Company’s
employees”) were granted stock options under Alltel’s stock-based compensation plans. Outstanding shares of
stock options held by the Company’s employees as of the spin off totaled 1,370,300 shares. Pursuant to the spin
off, 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 or forfeited. 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.
Pursuant to the spin off, Alltel amended its restricted stock plan such that any shares of restricted stock held by
employees of the Company became fully vested at that time. As a result, 68,200 shares of Alltel restricted stock
held by the Company’s employees vested on July 17, 2006. This resulted in the recognition by Windstream of the
associated remaining unrecognized compensation expense of $1.6 million during the third quarter of 2006.
F-70