Frontier Communications 2013 Annual Report Download - page 85

Stock Options
The following summary presents information regarding outstanding stock options as of December 31, 2013
and changes with regard to options under the EIPs:
Shares
Subject to
Option
Weighted
Average
Option Price
Per Share
Weighted
Average
Remaining
Life in Years
Aggregate
Intrinsic
Value
Balance at January 1, 2011 ............................ 1,507,000 $10.50 1.7 $603,000
Options granted ..................................... — $ —
Options exercised . . ................................. (10,000) $ 8.19 $12,000
Options canceled, forfeited or lapsed . . ............... (602,000) $10.86
Balance at December 31, 2011 . ........................ 895,000 $ 9.94 1.3 $ —
Options granted ..................................... — $ —
Options exercised . . ................................. — $ —
Options canceled, forfeited or lapsed . . ............... (355,000) $ 8.35
Balance at December 31, 2012 . ........................ 540,000 $10.99 0.9 $ —
Options granted ..................................... — $ —
Options exercised . . ................................. — $ —
Options canceled, forfeited or lapsed . . ............... (457,000) $10.59
Balance at December 31, 2013 . ........................ 83,000 $13.23 1.8 $ —
The number of options exercisable at December 31, 2013, 2012 and 2011 were 83,000, 540,000 and
895,000, with a weighted average exercise price of $13.23, $10.99 and $9.94, respectively.
There were no stock options exercised during 2013 and 2012. Cash received upon the exercise of options
during 2011 was $0.1 million. There were no stock options granted during 2013, 2012 and 2011. There is no
remaining unrecognized compensation cost associated with unvested stock options at December 31, 2013.
Non-Employee Directors’ Compensation Plans
Prior to October 1, 2010, non-employee directors received stock options upon joining the Board of
Directors. These options were awarded under the Directors’ Equity Plan commencing May 25, 2006. Prior
thereto, these options were awarded under the 2000 EIP. Options awarded to directors under the 2000 EIP are
included in the above tables.
Prior to October 1, 2013, each non-employee director was entitled to receive an annual retainer of (1)
$75,000 in cash, which he or she had the right to elect to receive in the form of stock units, and (2) $75,000 in
the form of stock units. In addition, the Lead Director, the chair of the Audit Committee and the chair of the
Compensation Committee each received an annual stipend of $20,000, the chair of the Nominating and
Corporate Governance Committee received an annual stipend of $10,000 and the chair of the Retirement Plan
Committee received an annual stipend of $7,500.
Beginning October 1, 2013, we revised our non-employee director compensation program in accordance
with best practices. Each non-employee director is now entitled to receive an annual retainer of (1) $90,000 in
cash, which he or she has the right to elect to receive in the form of stock units, as described below, and (2)
$90,000 in the form of stock units, in each case payable in advance in quarterly installments on the first
business day of each quarter. In addition, the Lead Director and the chair of the Audit Committee each receives
an additional annual cash stipend of $25,000, the chair of the Compensation Committee receives an additional
annual cash stipend of $20,000, the chair of the Nominating and Corporate Governance Committee receives an
additional annual cash stipend of $15,000 and the chair of the Retirement Plan Committee receives an
additional annual cash stipend of $10,000, which in each case he or she may elect to receive in the form of
stock units. The annual stipend paid to the Lead Director and each of the committee chairs is payable in arrears
in equal quarterly installments on the last business day of each quarter. Each director is required to irrevocably
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FRONTIER COMMUNICATIONS CORPORATION AND SUBSIDIARIES
Notes to Consolidated Financial Statements