Cincinnati Bell 2009 Annual Report Download - page 157

Download and view the complete annual report

Please find page 157 of the 2009 Cincinnati Bell 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 188

  • 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
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154
  • 155
  • 156
  • 157
  • 158
  • 159
  • 160
  • 161
  • 162
  • 163
  • 164
  • 165
  • 166
  • 167
  • 168
  • 169
  • 170
  • 171
  • 172
  • 173
  • 174
  • 175
  • 176
  • 177
  • 178
  • 179
  • 180
  • 181
  • 182
  • 183
  • 184
  • 185
  • 186
  • 187
  • 188

The Company recognizes accrued penalties related to unrecognized tax benefits in income tax expense. The
Company recognizes accrued interest related to unrecognized tax benefits in interest expense. Accrued interest
and penalties are insignificant at December 31, 2009 and December 31, 2008.
13. Stock-Based and Deferred Compensation Plans
The Company generally grants performance-based awards, time-based restricted shares, and stock options.
Shares authorized and available for grant under these plans were 33.1 million and 8.0 million, respectively, at
December 31, 2009.
Performance-Based Restricted Awards
Awards granted generally vest over three to four years and upon the achievement of certain performance-
based objectives. Under ASC 718, “Compensation — Stock Compensation,” performance-based awards are
expensed based on their grant date fair value if it is probable that the performance conditions will be achieved.
The following table provides a summary of the Company’s outstanding performance-based restricted shares:
2009 2008 2007
(in thousands) Shares
Weighted-
Average
Grant Date
Fair Value
Per Share Shares
Weighted-
Average
Grant Date
Fair Value
Per Share Shares
Weighted-
Average
Grant Date
Fair Value
Per Share
Non-vested as of January 1, ................ 2,307 $4.20 2,932 $4.75 1,668 $4.30
Granted* ............................... 2,786 2.95 1,438 3.98 1,896 5.01
Vested ................................. (838) 4.16 (550) 4.51 (444) 4.29
Forfeited ............................... (37) 2.99 (1,513) 4.95 (188) 4.52
Non-vested at December 31, ............... 4,218 $3.39 2,307 $4.20 2,932 $4.75
(dollars in millions)
Compensation expense for the year .......... $ 3.9 $ 3.1 $ 4.5
Tax benefit related to compensation expense . . $ (1.4) $ (1.2) $ (1.7)
Grant date fair value of shares vested ........ $ 3.5 $ 2.5 $ 1.9
* Assumes the maximum number of awards that can be earned if the performance conditions are achieved.
As of December 31, 2009, unrecognized compensation expense related to performance-based awards was
$1.8 million, which is expected to be recognized over a weighted average period of one year. In addition to the
shares granted above in 2009, the Company also granted a cash-payment performance award with a base award
of $1.3 million, with the final award payment indexed to the percentage change in the Company’s stock price
from the date of grant. The expense recorded for 2009 was $3.3 million, and there is no remaining unrecognized
compensation.
Time-Based Restricted Awards
The grant date fair value of time-based restricted shares generally vest and are expensed in one-third
increments over a period of three years. The following table provides a summary of the Company’s outstanding
time-based restricted shares:
2009 2008 2007
(in thousands) Shares
Weighted-
Average
Grant Date
Fair Value
Per Share Shares
Weighted-
Average
Grant Date
Fair Value
Per Share Shares
Weighted-
Average
Grant Date
Fair Value
Per Share
Non-vested as of January 1, ................... 303 $4.82 375 $4.87 253 $4.74
Granted ................................... 107 2.90 60 4.69 280 4.94
Vested .................................... (171) 4.82 (97) 4.85 (144) 4.78
Forfeited .................................. (26) 4.87 (35) 5.03 (14) 4.74
Non-vested at December 31, ................... 213 $3.85 303 $4.82 375 $4.87
(dollars in millions)
Compensation expense for the year ............. $ 0.9 $0.7 $ 0.7
Tax benefit related to compensation expense ...... $(0.3) $(0.3) $ (0.3)
Grant date fair value of shares vested ............ $ 0.8 $0.5 $ 0.7
87
Form 10-K