This excerpt taken from the AKS DEF 14A filed Apr 17, 2008.
Performance share awards
Performance share grants also are an important element of an NEOs annual compensation package because they closely align the interests of the NEOs and the Companys stockholders by directly linking how many shares, if any, ultimately are earned by an NEO to the performance of the Company over a three-year performance period (the Performance Period). Each grant of a performance share award is expressed as a target number of shares of the Companys common stock. The number of shares of common stock, if any, actually earned by and issued to the NEO under a performance share award will be based upon the performance of the Company over the Performance Period. By way of example, the Performance Period applicable to the performance share awards granted in January 2005 started on January 1, 2005 and ended on December 31, 2007. Depending upon the Companys performance with reference to the performance categories described below, an NEO ultimately may earn from 0% to 150% of the target number of shares granted. The performance categories used to determine how many performance shares ultimately will be earned and issued are:
One-half of the total target number of shares awarded may be earned based on the relative total shareholder return performance and the other half may be earned based on the Growth Rate performance. For each performance category, levels have been established to provide threshold, target and maximum payouts as follows:
If the threshold performance level is not achieved in a performance category as of the end of the Performance Period, then none of the target shares related to that category will be earned or issued. If at least the threshold is achieved in a performance category, then shares will be earned and issued in an amount equal to the number of the awards target shares related to that category, multiplied by a percentage determined by a straight-line interpolation between the actual level of the Companys performance and the above-stated payout percentages.