Quarterly report pursuant to Section 13 or 15(d)

Stock Options and Restricted Stock

v3.3.0.814
Stock Options and Restricted Stock
 9 Months Ended
Sep. 30, 2015
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Stock Options and Restricted Stock
Stock Options and Restricted Stock
        
Starz has granted to certain of its employees and directors, stock options to purchase Series A common stock, restricted shares of Series A common stock and restricted stock units pursuant to certain incentive plans.

Stock compensation expense, by expense category, consisted of the following (in millions):
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
2015
 
2014
 
2015
 
2014
Programming costs
$
0.6

 
$
0.5

 
$
1.9

 
$
1.5

Operating expenses
—

 
0.1

 
0.2

 
0.2

Selling, general and administrative expenses
7.5

 
7.0

 
22.4

 
21.2

Total stock compensation expense
$
8.1

 
$
7.6

 
$
24.5

 
$
22.9



As of September 30, 2015, the total unrecognized compensation cost related to unvested stock options, restricted stock and restricted stock units was approximately $47.8 million. Such amount will be recognized in Starz’s condensed consolidated statements of operations over a weighted average period of approximately 2.08 years.

The following table presents the number and weighted average exercise price (“WAEP”) of stock options to purchase Starz common stock:
 
Options
 
WAEP
Outstanding at December 31, 2014
16,431,666

 
$
17.42

Granted
61,288

 
$
35.23

Exercised
(3,033,665
)
 
$
14.12

Forfeited
(466,647
)
 
$
22.15

Expired/canceled
—

 
$
—

Outstanding at September 30, 2015
12,992,642

 
$
18.11

 
 
 
 
Exercisable at September 30, 2015
5,861,286

 
$
14.04



At September 30, 2015, the weighted-average remaining contractual term of outstanding options was 5.2 years and exercisable options was 4.0 years. At September 30, 2015, the aggregate intrinsic value of the outstanding options was $249.8 million and the exercisable options was $136.6 million.

The following table presents the number and weighted-average grant date fair value of restricted stock grants:
 
Restricted Stock
 
Weighted
Average Grant-Date Fair Value
Outstanding at December 31, 2014
708,658

 
$
21.01

Granted
29,421

 
$
39.29

Vested
(78,417
)
 
$
17.64

Forfeited
(20,607
)
 
$
27.24

Outstanding at September 30, 2015
639,055

 
$
22.07


In 2015, Starz granted certain employees restricted stock units that will vest based upon the actual, cumulative Adjusted OIBDA (as defined in Note 9) achieved by Starz during a three year performance period beginning on January 1, 2015 and ending on December 31, 2017 (“Performance Period”), compared to a target cumulative Adjusted OIBDA during the Performance Period specified by the Starz compensation committee. Potential vesting of the restricted stock units ranges from a threshold of 50% of the target award if Starz’s actual three-year cumulative Adjusted OIBDA equals 90% of the targeted amount, to a maximum of 200% of the target award if Starz’s actual three-year cumulative Adjusted OIBDA equals or exceeds 120% of the targeted amount. Results between threshold, target and maximum will be interpolated on a straight line basis. Each restricted stock unit provides the right to receive, in those specified circumstances, one share of Starz Series A common stock. Based upon the target for the Performance Period, the number of restricted stock units representing the threshold, target and maximum were 53,535 units, 107,070 units and 214,140 units, respectively (which are not reflected in the table above).

At September 30, 2015, 2.0 million outstanding stock options and 0.2 million restricted shares were held by Liberty Media Corporation employees as a result of the January 2013 spin-off of Liberty Spinco, Inc. (currently known as Liberty Media Corporation), our then wholly-owned subsidiary.