FairPoint Communications 2013 Annual Report Download - page 98

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the 24 days ended January 24, 2011, the weighted average grant date fair value of restricted stock awards granted was
$1.7 million, $0.2 million, $0.2 million and $10.2 million, respectively.
(b) Based upon the respective grant date fair value, the aggregate fair value of restricted stock which vested during the
year ended December 31, 2013, the year ended December 31, 2012, the 341 days ended December 31, 2011 and the
24 days ended January 24, 2011 was $2.4 million, $2.1 million, $0.1 million and $3.5 million, respectively.
Stock-Based Compensation Plans of the Predecessor Company
Prior to the Effective Date, the Company had stock options, stock units, non-vested stock and restricted stock activity under
various stock-based compensation plans of the Predecessor Company. Pre-tax stock compensation expense recognized during
the 24 days ended January 24, 2011 for the Predecessor Company was immaterial.
Pursuant to the Plan, all then outstanding equity interests of the Company, including but not limited to all outstanding shares
of common stock, options and contractual or other rights to acquire any equity interests, were canceled and extinguished on the
Effective Date.
(17) Business Concentrations
Geographic
As of December 31, 2013, approximately 85% of the Company's access line equivalents were located in Maine, New
Hampshire and Vermont. As a result of this geographic concentration, the Company's financial results will depend significantly
upon economic conditions in these markets. A deterioration or recession in any of these markets could result in a decrease in
demand for the Company's services and a resulting loss of access line equivalents which could have a material adverse effect on
the Company's business, financial condition, results of operations, liquidity and/or the market price of the Company's outstanding
securities.
In addition, if state regulators in Maine, New Hampshire or Vermont were to take an action that is adverse to the Company's
operations in those states, the Company could suffer greater harm from that action by state regulators than it would from action
in other states because of the concentration of operations in those states.
Labor
As of December 31, 2013, we employed a total of 3,171 employees, 2,017, or 64%, of whom were covered by 14 collective
bargaining agreements. As of December 31, 2013, approximately 1,800 employees were covered by three collective bargaining
agreements that expire during 2014.
(18) Operational Restructuring Charges
During the 341 days ended December 31, 2011, the Company announced plans to reduce its workforce to ensure that the
Company was staffed at a level appropriate to serve its customers, while prudently managing expenses. The reduction eliminated
approximately 400 positions. In connection with this plan, the Company recognized $7.9 million in restructuring charges, consisting
of severance and one-time incentive payments, which are included within cost of services and sales and selling, general and
administrative expense in the consolidated statement of operations.
(19) Assets Held for Sale and Discontinued Operations
On November 28, 2012, the Company entered into an agreement to sell the capital stock of its Idaho-based operations to
Blackfoot Telecommunications Group ("Blackfoot") of Missoula, Montana. The closing of the transaction was completed on
January 31, 2013 for $30.5 million in gross cash proceeds. Eleven FairPoint employees joined the Blackfoot organization at
closing. The Company recorded a gain, before $6.7 million of income taxes, of $16.7 million upon the closing of the transaction,
which is reported within discontinued operations in the consolidated statement of operations for the year ended December 31,
2013. Due to differences between the book and tax basis of the Idaho-based operations, the gain reported on the sale for income
tax purposes will be $27.1 million.