Dow Chemical 2014 Annual Report Download - page 148

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The following table shows changes in nonvested performance deferred stock:
Performance Deferred Stock 2014
Shares in thousands
Target
Shares
Granted (1)
Grant Date
Fair Value (2)
Nonvested at January 1, 2014 2,504 $ 33.03
Granted 2,425 $ 46.72
Vested (3) (1,185) $ 34.00
Canceled (24) $ 38.60
Nonvested at December 31, 2014 3,720 $ 41.61
(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.
(3) Vested shares for the 2012 - 2014 performance period that were earned (i.e., performance
conditions were satisfied and the target shares granted for the performance period vested)
during the applicable fiscal year. Shares earned will be delivered in February 2015 at the
applicable pay-out percentage. Certain executive employees may opt to receive a cash
payment equal to the value of the stock award on the date of delivery.
Additional Information about Performance Deferred Stock
In millions 2014 2013 2012
Total fair value of performance deferred stock vested and delivered (1) $ 12 $ 14 $ 68
Related tax benefit $ 5 $ 5 $ 25
Total compensation expense for performance deferred stock awards $ 67 $ 62 $ 21
Related tax benefit $ 25 $ 23 $ 8
Shares of performance deferred stock settled in cash (2) 0.1 0.2 1
Total cash paid to settle performance deferred stock awards (3) $ 6 $ 6 $ 34
(1) Includes the fair value of shares vested in prior years and delivered in the reporting year.
(2) Performance deferred stock awards vested in prior years and delivered in the reporting year.
(3) Cash paid to certain employees for performance deferred stock awards vested in prior periods and delivered in the
reporting year, equal to the value of the stock award on the date of delivery.
Total unrecognized compensation cost related to performance deferred stock awards of $63 million at December 31, 2014 is
expected to be recognized over a weighted-average period of 0.90 years. At December 31, 2014, approximately 0.8 million
performance deferred shares with a grant date weighted-average fair value of $34.00 per share were vested, but not issued.
These shares are scheduled to be issued in February 2015.
Restricted Stock
Under the 2012 Plan, the Company may grant shares (including options, stock appreciation rights, stock units and restricted
stock) to non-employee directors over the 10-year duration of the program, subject to the plan's aggregate limit as well as
annual individual limits. In 2014, 24,840 shares of restricted stock with a weighted-average fair value of $48.98 per share were
issued under this plan. The restricted stock issued under this plan cannot be sold, assigned, pledged or otherwise transferred by
the non-employee director, until the director is no longer a member of the Board.
NOTE 21 – STOCKHOLDERS’ EQUITY
Cumulative Convertible Perpetual Preferred Stock, Series A
Equity securities in the form of Cumulative Convertible Perpetual Preferred Stock, Series A (“preferred series A”) were issued
on April 1, 2009 to Berkshire Hathaway Inc. in the amount of $3 billion (3 million shares) and the Kuwait Investment Authority
in the amount of $1 billion (1 million shares). The Company will pay cumulative dividends on preferred series A at a rate of
8.5 percent per annum in either cash, shares of common stock, or any combination thereof, at the option of the Company.
Dividends may be deferred indefinitely, at the Company’s option. If deferred, common stock dividends must also be deferred.
Any past due and unpaid dividends will accrue additional dividends at a rate of 10 percent per annum, compounded quarterly. If
dividends are deferred for any six quarters, the preferred series A shareholders may elect two directors to the Company’s Board