Dow Chemical 2014 Annual Report Download - page 147
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123
Deferred Stock
The Company grants deferred stock to certain employees. The grants vest after a designated period of time, generally one to
three years. The following table shows changes in nonvested deferred stock:
Deferred Stock 2014
Shares in thousands Shares
Grant Date
Fair Value (1)
Nonvested at January 1, 2014 10,588 $ 34.38
Granted 2,344 $ 46.88
Vested (3,311) $ 37.32
Canceled (269) $ 35.34
Nonvested at December 31, 2014 9,352 $ 36.45
(1) Weighted-average per share.
Additional Information about Deferred Stock
In millions, except per share amounts 2014 2013 2012
Weighted-average fair value per share of deferred stock granted $ 46.88 $ 32.13 $ 33.81
Total fair value of deferred stock vested and delivered (1) $ 156 $ 137 $ 252
Related tax benefit $ 58 $ 51 $ 93
Total compensation expense for deferred stock awards $ 99 $ 104 $ 129
Related tax benefit $ 37 $ 39 $ 48
(1) Includes the fair value of shares vested in prior years and delivered in the reporting year.
Total unrecognized compensation cost related to deferred stock awards of $87 million at December 31, 2014 is expected to be
recognized over a weighted-average period of 0.86 years. At December 31, 2014, approximately 44,941 deferred shares with a
grant date weighted-average fair value per share of $36.52 had previously vested, but were not issued. These shares are
scheduled to be issued to employees within one to three years or upon retirement.
Performance Deferred Stock
The Company grants performance deferred stock to certain employees. The grants vest when the Company attains specified
performance targets, such as return on capital and relative total shareholder return, over a predetermined period, generally one
to three years. Compensation expense related to performance deferred stock awards is recognized over the lesser of the service
or performance period. Changes in the fair value of liability instruments are recognized as compensation expense each quarter.
The following table shows the performance deferred stock awards granted:
Performance Deferred Stock Awards Target
Shares
Granted (1)
Grant Date
Fair Value (2)
Shares in thousands
Year Performance Period
2014 January 1, 2014 – December 31, 2016 2,425 $ 46.72
2013 January 1, 2013 – December 31, 2015 1,321 $ 32.16
2012 January 1, 2012 – December 31, 2014 1,205 $ 34.00
(1) At the end of the performance period, the actual number of shares issued can range from
zero to 250 percent of the target shares granted in the 2012 and 2013 grant years, and
zero to 200 percent of target shares granted in the 2014 grant year.
(2) Weighted-average per share.