Stockholders' Deficit

12 Months Ended

Dec. 31, 2016

Stockholders' Equity Note [Abstract]

Stockholders' Deficit

Stockholders' Deficit

Shares outstanding

The following table sets forth the change in the number of shares of Class A common stock outstanding during the fiscal years ended December 31, 2016 and 2015:

	December 31,
	2016	2015
Shares outstanding as of beginning of period	86.5	85.1
Shares issued as part of equity-based compensation plans and the ESPP, net of shares surrendered	1.5	1.4
Shares outstanding as of end of period	88.0	86.5

Stock-based and other incentive compensation

Pursuant to our incentive stock plans we offer stock-based compensation in the form of stock options and RSUs to employees and our non-employee directors. The terms of the stock option and RSU awards, including the vesting schedule of such awards, are determined at our discretion subject to the terms of the applicable equity-based compensation plan. We also offered an ESPP through June 30, 2015, at which point in time the shares allocated to this plan were fully issued and the ESPP terminated in accordance with its terms. At the Annual Meeting, our stockholders approved the adoption of a new ESPP. The first offering period under the new ESPP commenced on January 1, 2017.

Options granted over the last several years have generally become exercisable in four equal installments beginning on the first anniversary of the date of grant with a maximum term of ten years or when certain performance targets are determined to have been met. RSUs typically vest in four equal installments beginning on the first anniversary of the date of grant or when certain performance targets are determined to have been met.

We recognize expense for stock-based compensation plans based on the estimated fair value of the related awards in accordance with ASC 718. Stock options are granted with exercise prices that are not less than the fair market value of our common stock on the date of grant. We periodically grant certain stock-based awards that are contingent upon SGC or certain of our subsidiaries achieving certain pre-determined financial performance targets. Upon determining that the performance target is probable, the fair value of the award is recognized over the service period. Determining the probability of achieving a performance target requires estimates and judgment.    

On August 5, 2016, we announced that Kevin Sheehan succeeded M. Gavin Isaacs as President and Chief Executive Officer of the Company. On August 10, 2016, Mr. Sheehan received sign-on equity awards consisting of (a) 400,000 performance-conditioned restricted stock units that will vest based on achievement of specified performance conditions over a three-year period and (b) equity awards with a grant date value equal to approximately 250% of his base salary, prorated based on the number of days Mr. Sheehan will be employed in 2016, and consisting of (i) restricted stock units and stock options, each with a four-year vesting schedule and (ii) performance-conditioned stock options vesting over a four-year period. The remaining unamortized expense related to all unvested equity awards held by Mr. Isaacs as of December 31, 2016 was recognized during 2016.

As of December 31, 2016, we had approximately 21.3 million shares of common stock authorized for awards under the 2003 Plan (plus available shares from a pre-existing equity-based compensation plan). As of December 31, 2016, we had approximately 4.0 million shares available for future grants of equity awards under the 2003 Plan plus available shares from a pre-existing equity-based compensation plan (excluding shares underlying outstanding awards). We also have outstanding stock options and RSUs granted as part of inducement awards that were not approved by our stockholders, as permitted by applicable stock exchange rules.

Stock options

For the years ended December 31, 2016, 2015 and 2014, we recognized stock-based compensation expense of $6.4 million, $2.2 million and $2.2 million, respectively, related to the vesting of stock options. During 2016 we issued 1.5 million stock options with a weighted average exercise price $9.56 and a total grant date fair value of $7.2 million. At December 31, 2016, we had $5.1 million of unrecognized stock-based compensation expense relating to approximately 2.0 million unvested stock options that will be amortized over a weighted-average period of approximately two years and have an average remaining contract term of 8.9 years with a weighted average exercise price of $10.78. During the year ended December 31, 2016, we received $2.0 million in cash from the exercise of stock options.

Restricted stock units

A summary of the changes in RSUs outstanding under our equity-based compensation plans during 2016 is presented below:

	Number of Restricted Stock Units		Weighted Average Grant Date Fair Value
Unvested RSUs as of December 31, 2015	5.6		$	13.05
Granted	2.1		$	9.35
Vested	(1.9	)	$	12.73
Cancelled	(0.9	)	$	12.63
Unvested RSUs as of December 31, 2016	4.9		$	11.68

The weighted-average grant date fair value of RSUs granted during 2016 and 2015 was $9.35 and $12.95, respectively. The fair value of each RSU grant is based on the market value of our common stock at the time of grant. During the years ended December 31, 2016, 2015 and 2014, we recognized stock-based compensation expense of $28.8 million, $22.9 million and $21.5 million, respectively, related to the vesting of RSUs. At December 31, 2016, we had $37.1 million of unrecognized stock-based compensation relating to unvested RSUs that will be amortized over a weighted-average period of approximately two years. The fair value at vesting date of RSUs vested during the years ended December 31, 2016, 2015 and 2014 was $24.2 million, $19.2 million and $35.2 million, respectively.