STOCKHOLDERS' EQUITY

3 Months Ended

Mar. 31, 2015

STOCKHOLDERS' EQUITY

6. STOCKHOLDERS’ EQUITY

Dividends on Common Stock

During 2014 and the first quarter of 2015, CCA’s Board of Directors declared the following quarterly dividends on its common stock:

Declaration Date	Record Date	Payable Date	Per Share
February 20, 2014	April 2, 2014	April 15, 2014	$	0.51
May 15, 2014	July 2, 2014	July 15, 2014	$	0.51
August 14, 2014	October 2, 2014	October 15, 2014	$	0.51
December 11, 2014	January 2, 2015	January 15, 2015	$	0.51
February 20, 2015	April 2, 2015	April 15, 2015	$	0.54

Future dividends will depend on CCA’s distribution requirements as a REIT, future earnings, capital requirements, financial condition, opportunities for alternative uses of capital, and on such other factors as the Board of Directors of CCA may consider relevant.

Stock Options

In the first quarter of 2015 and during 2014, CCA elected not to issue stock options to its non-employee directors, officers, and executive officers as it had in years prior to 2013 and instead elected to issue all of its equity compensation in the form of restricted common stock and common stock units as described below. However, CCA continues to recognize stock option expense during the vesting period of stock options awarded in prior years. During the three months ended March 31, 2015 and 2014, CCA expensed $0.4 million and $0.6 million, respectively, net of estimated forfeitures, relating to its outstanding stock options, all of which was charged to general and administrative expenses. As of March 31, 2015, options to purchase 1.7 million shares of common stock were outstanding with a weighted average exercise price of $19.98.

Restricted Stock and Restricted Stock Units

During the first quarter of 2015, CCA issued 421,000 shares of restricted common stock units (“RSUs”) to certain of its employees and non-employee directors, with an aggregate fair value of $16.9 million, including 370,000 RSUs to employees and non-employee directors whose compensation is charged to general and administrative expenses and 51,000 RSUs to employees whose compensation is charged to operating expense. During 2014, CCA issued 548,000 shares of RSUs to certain of its employees and non-employee directors, with an aggregate fair value of $17.8 million, including 478,000 RSUs to employees and non-employee directors whose compensation is charged to general and administrative expense and 70,000 RSUs to employees whose compensation is charged to operating expense.

CCA established performance-based vesting conditions on the shares of restricted common stock and RSUs awarded to its officers and executive officers in 2015 and 2014 and in years prior to 2013. Unless earlier vested under the terms of the agreements, shares or RSUs issued to officers and executive officers in these years are subject to vesting over a three-year period based upon the satisfaction of certain performance criteria. With respect to the RSUs issued in 2015 to officers and executive officers, annual performance criteria was established for each of the three years ending December 31, 2015, 2016, and 2017, and no more than one-third of the RSUs may vest in any one performance period. With respect to RSUs issued in 2014 and in years prior to 2013, no more than one-third of such shares or RSUs may vest in the first performance period; however, the performance criteria are cumulative for the three-year period. With respect to the RSUs issued in 2013 to officers and executive officers, unless earlier vested under the terms of the RSU agreement, the RSUs issued vest evenly over a three-year period and are not subject to performance-based criteria. Shares of restricted stock and RSUs issued to other employees, unless earlier vested under the terms of the agreements, “cliff” vest on the third anniversary of the award, while RSUs issued to non-employee directors vest one year from the date of award.

During the three months ended March 31, 2015, CCA expensed $3.4 million, net of forfeitures, relating to restricted common stock and RSUs ($0.4 million of which was recorded in operating expenses and $3.0 million of which was recorded in general and administrative expenses). During the three months ended March 31, 2014, CCA expensed $2.7 million, net of forfeitures, relating to restricted common stock and RSUs ($0.3 million of which was recorded in operating expenses and $2.4 million of which was recorded in general and administrative expenses). As of March 31, 2015, approximately 1.0 million shares of restricted common stock and RSUs remained outstanding and subject to vesting.