Charter 2011 Annual Report Download - page 112

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CHARTER COMMUNICATIONS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2011, 2010 AND 2009
(dollars in millions, except share or per share data or where indicated)
F- 28
17. Stock Compensation Plans
Charter’s 2009 Stock Plan provides for grants of nonqualified stock options, incentive stock options, stock appreciation rights,
dividend equivalent rights, performance units and performance shares, share awards, phantom stock, restricted stock units and
restricted stock. Directors, officers and other employees of the Company and its subsidiaries, as well as others performing
consulting services for the Company, are eligible for grants under the 2009 Stock Plan.
In 2009, the majority of restricted stock and performance units and shares outstanding at that time were voluntarily forfeited by
participants without termination of the service period, and the remaining, along with all stock options, were canceled on the
Effective Date.
The Plan included an allocation of not less than 3% of new equity for employee grants with 50% of the allocation to be granted
within thirty days of the Company's emergence from bankruptcy. In December 2009, the Company's board of directors authorized
8 million shares under the 2009 Stock Plan and awarded to certain employees 2 million shares of restricted stock, one-third of
which are to vest on each of the first three anniversaries of the Effective Date. Such grant of new awards is deemed to be a
modification of old awards and was accounted for as a modification of the original awards. As a result, unamortized compensation
cost of $12 million was added to the cost of the new award and is being amortized over the vesting period.
Under the 2009 Stock Plan, restricted stock vests annually over a one to four-year period beginning from the date of grant. Stock
options generally vest annually over four years from either the grant date or delayed vesting commencement dates. A portion of
stock options and restricted stock granted in 2011 vest based on achievement of stock price hurdles over a delayed vesting schedule.
Stock options generally expire ten years from the grant date. Restricted stock units have no voting rights and vest ratably over
four years from either the grant date or delayed vesting commencement dates. As of December 31, 2011 (Successor), total
unrecognized compensation remaining to be recognized in future periods totaled $44 million for restricted stock, $66 million for
stock options and $13 million for restricted stock units and the weighted average period over which it is expected to be recognized
is 3 years for restricted stock, 3 years for stock options and 4 years for restricted stock units. During the eleven months ended
November 30, 2009, no equity awards were granted; however Charter granted $12 million of performance cash and restricted cash
under Charter’s 2009 incentive program.
The Company recorded $41 million, $28 million, $1 million and $26 million of stock compensation expense for the years ended
December 31, 2011 and 2010 (Successor), one month ended December 31, 2009 (Successor) and eleven months ended November
30, 2009 (Predecessor), respectively, which is included in selling, general, and administrative expense and other operating expense
(income), net.