US Cellular 2010 Annual Report Download - page 74

Download and view the complete annual report

Please find page 74 of the 2010 US Cellular annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 88

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88

UNITED STATES CELLULAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 15 STOCK-BASED COMPENSATION (Continued)
U.S. Cellular estimates the fair value of restricted stock units based on the closing market price of
U.S. Cellular shares on the date of grant. The fair value is then recognized as compensation cost on a
straight-line basis over the requisite service periods of the awards, which is generally the vesting period.
A summary of U.S. Cellular nonvested restricted stock units at December 31, 2010 and changes during
the year then ended is presented in the table below:
Weighted
Average
Grant Date
Number Fair Value
Nonvested at December 31, 2009 ....................... 581,000 $48.68
Granted ........................................ 334,000 42.21
Vested ......................................... (110,000) 71.76
Forfeited ....................................... (53,000) 44.83
Nonvested at December 31, 2010 ....................... 752,000 $42.69
The total fair value of restricted stock units that vested during 2010, 2009 and 2008 was $4.7 million,
$4.2 million and $8.3 million, respectively, as of the respective vesting dates. The weighted average grant
date fair value of restricted stock units granted in 2010, 2009 and 2008 was $42.21, $33.00 and $56.12,
respectively.
Long-Term Incentive Plan—Deferred Compensation Stock Units—Certain U.S. Cellular employees may
elect to defer receipt of all or a portion of their annual bonuses and to receive a company matching
contribution on the amount deferred. All bonus compensation that is deferred by employees electing to
participate is immediately vested and is deemed to be invested in U.S. Cellular Common Share stock
units. The amount of U.S. Cellular’s matching contribution depends on the portion of the annual bonus
that is deferred. Participants receive a 25% match for amounts deferred up to 50% of their total annual
bonus and a 33% match for amounts that exceed 50% of their total annual bonus; such matching
contributions also are deemed to be invested in U.S. Cellular Common Share stock units. The matching
contribution stock units vest ratably at a rate of one-third per year over three years. Upon vesting and
distribution of such matching contribution stock units, participants will receive U.S. Cellular Common
Shares.
U.S. Cellular estimates the fair value of deferred compensation matching contribution stock units based
on the closing market price of U.S. Cellular Common Shares on the date of match. The fair value of such
matching contribution stock units is then recognized as compensation cost using an accelerated
attribution method over the requisite service periods of the awards, which is generally the vesting period.
A summary of U.S. Cellular nonvested deferred compensation stock units at December 31, 2010 and
changes during the year then ended is presented in the table below:
Weighted
Average
Grant Date
Number Fair Value
Nonvested at December 31, 2009 ........................ 3,900 $41.73
Granted ......................................... 4,200 40.76
Vested .......................................... (7,700) 41.27
Forfeited ......................................... (100) 55.45
Nonvested at December 31, 2010 ........................ 300 $40.13
66