Windstream 2006 Annual Report Download - page 160

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
9. Stock-Based Compensation Plans, Continued:
Non-vested Alltel stock options relating to the Company’s employees as of December 31, 2006 and changes during the
twelve months ended December 31, 2006 were as follows:
(Thousands)
Weighted
Average Price
Per Share
Number
of
Shares
Outstanding at December 31, 2005 1,039.2 $53.51
Granted --
Vested (402.6) 55.04
Forfeited (684.3) 52.73
Transfers, net 47.7 55.15
Outstanding at December 31, 2006 - $ -
Amounts reflected as Transfers, net in the table above represent options held by employees that transferred between the
wireless and wireline divisions of Alltel between December 31, 2005 and July 17, 2006, the date of the spin-off from
Alltel. As previously noted, at spin, all employees of the Company terminated their employment with Alltel and
therefore forfeited any unvested stock options.
In January 2005 and 2004, Alltel granted to certain senior management employees of the Company restricted stock
awards which had an aggregate fair value on the date of grant of $1.8 million and $2.5 million, respectively. The cost of
the restricted stock awards was determined based on the fair market value of the shares at the date of grant reduced by
the $1.00 par value per share charged to the employee and was expensed ratably over the original vesting period. The
restricted shares granted in 2005 were scheduled to vest three years from the date of grant, except that one-third of the
restricted shares could vest after each of the first two-year anniversaries from the grant date if Alltel achieved a certain
targeted total stockholder return for its peer group during the three-year period preceding each of those two years. The
restricted shares granted in 2004 were scheduled to vest in equal increments over a three-year period following the date
of grant. Due to the spin-off, Alltel amended its restricted stock plan such that any shares of restricted stock held by
employees of the Company became fully vested upon spin. As a result, Windstream recognized the associated remaining
unrecognized compensation at spin, resulting in the recognition of $1.6 million in additional stock-based compensation
expense in the third quarter of 2006.
Alltel restricted stock activity for the twelve months ended December 31, 2006 was as follows:
(Thousands)
Number of
Shares
Weighted Average
Fair Value Per Share
Non-vested at December 31, 2005 68,183 $52.52
Granted --
Vested (68,183) 52.52
Forfeited --
Non-vested at December 31, 2006 - $ -
10. Restructuring and Other Charges:
A summary of the restructuring and other charges recorded in 2006 was as follows:
(Millions) Wireline
Product
Distribution
Other
Operations Total
Fees associated with spin-off from Alltel $ 7.9 $ - $ - $ 7.9
Signage and other rebranding costs related to the spin-off 13.8 - - 13.8
Severance and employee benefit costs 10.5 0.1 - 10.6
Costs associated with split-off of directory publishing - - 11.2 11.2
Computer system separation and conversion costs 5.9 - - 5.9
Total restructuring and other charges $38.1 $0.1 $11.2 $49.4
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