Windstream 2013 Annual Report Download - page 207

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
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F-71
9. Share-Based Compensation Plans, Continued:
Restricted Stock and Restricted Stock Unit Activity - During 2013, 2012 and 2011, our Board of Directors approved grants of
restricted stock and restricted stock units to officers, executives, non-employee directors and certain management employees.
These grants include the standard annual grants to this employee and director group as a key component of their annual
incentive compensation plan and one-time grants. On April 12, 2013, a one-time grant, totaling 125,125 shares, was provided
as a retention incentive for select members of management. On February 8, 2011, a one-time grant, totaling 237,989 shares of
restricted stock, was approved to provide a retention incentive to the CEO and select members of management. In 2011, we
began issuing performance-based restricted stock units to executive officers rather than performance-based restricted shares.
Each recipient of the performance-based restricted stock units may vest in a number of shares from zero to 150.0 percent of
their award based on attainment of certain operating targets, some of which are indexed to the performance of Standard &
Poor's 500 Stock Index, over a three-year period.
The vesting periods and grant date fair value for restricted stock and restricted stock units issued was as follows for the years
ended December 31:
2013 2012 2011
(Thousands) Common
Shares Common Shares Common Shares
Vest ratably over remaining service period, up to four years (a) — — 886.3
Vest ratably over a three-year service period 2,254.0 1,543.7 1,024.0
Vest ratably over a two-year service period 68.4 — —
Vest variably over a three-year service period 186.1 54.7 —
Vest contingently over a three-year performance period 786.7 723.5 522.9
Vest three years from date of grant, service based — 4.0 388.5
Vest one year from date of grant, service based (b) 81.5 51.4 48.6
Total granted 3,376.7 2,377.3 2,870.3
Grant date fair value (Millions) $ 32.6 $ 29.4 $ 36.3
(a) In conjunction with the acquisition of PAETEC, we granted 886,300 restricted stock units to former PAETEC
employees to replace outstanding, unvested PAETEC restricted stock units held by these same employees as of
acquisition date. The vesting provisions of the original grants were retained. Each recipient is entitled to one restricted
share per restricted stock unit.
(b) Represents restricted stock granted to non-employee directors.
For performance based restricted stock units granted in 2013 the operating targets for the first vesting period were approved by
the Board of Directors in February 2013. For the performance based restricted stock granted in 2012, the operating targets for
the first and second vesting period were approved by the Board of Directors in February 2012 and 2013, respectively. For
performance based restricted stock granted in 2011, the operating targets for the first, second and third vesting period were
approved by the Board of Directors in February 2011, 2012 and 2013, respectively. For 2013 and measurement periods prior,
each of the operating targets were met by the end of their respective measurement periods.
Restricted stock and restricted stock unit activity for the year ended December 31, 2013 was as follows:
(Thousands)
Underlying
Number of
Shares
Weighted
Average Fair
Value
Non-vested at December 31, 2012 4,274.4 $ 12.24
Granted 3,376.7 $ 9.66
Vested (2,031.6) $ 11.92
Forfeited (360.0) $ 11.56
Non-vested at December 31, 2013 5,259.5 $ 10.75