Kodak 2015 Annual Report Download - page 53

Officers, directors and employees of the Company and its consolidated subsidiaries are eligible to receive awards. Stock options are generally non-qualified, are at
exercise prices not less than 100% of the per share fair market value on the date of grant and expire seven years after the grant date. Stock-based compensation
awards granted under Kodak’s stock incentive plan are generally subject to a three-year vesting period from the date of grant. Unless sooner terminated by the
Executive Compensation Committee, no awards may be granted under the 2013 Plan after the tenth anniversary of the Effective Date.
The maximum number of shares of common stock that may be issued under the 2013 Plan is approximately 4.8 million. In addition, under the 2013 Plan, the
maximum number of shares available for the grant of incentive stock options is 2.0 million shares. The maximum number of shares as to which stock options or
stock appreciation rights may be granted to any one person under the 2013 Plan in any calendar year is 2.0 million shares. The maximum number of performance-
based compensation awards that may be granted to any one employee under the 2013 Plan in any calendar year is 1.0 million shares or, in the event such award is
paid in cash, $2.5 million. The maximum number of awards that may be granted to any non-employee director under the 2013 Plan in any calendar year may not
exceed a number of awards with a grant date fair value of $900,000, computed as of the grant date.
Compensation expense is recognized on a straight-line basis over the service or performance period for each separately vesting tranche of the award and is adjusted
for actual forfeitures before vesting. Kodak assesses the likelihood that performance-based shares will be earned based on the probability of meeting the
performance criteria. For those performance-based awards that are deemed probable of achievement, expense is recorded, and for those awards that are deemed not
probable of achievement, no expense is recorded. Kodak assesses the probability of achievement each quarter.
Restricted Stock Units
Restricted stock units are payable in shares of the Company common stock upon vesting. The fair value is based on the closing market price of the Company’s
stock on the grant date. Compensation cost related to restricted stock units was $7 million for the years ended December 31, 2015 and 2014 and $1 million for the
four months ending December 31, 2013.
As of December 31, 2015, there was $6 million of unrecognized compensation cost related to restricted stock units. The cost is expected to be recognized over a
weighted average period of 1.5 years.
The following table summarizes information about restricted stock unit activity for the year ended December 31, 2015:
Number of
Restricted
Stock Units
Weighted-Average
Grant Date
Fair Values
Outstanding on December 31, 2014 685,430 $ 22.15
Granted 387,187 $ 14.86
Vested (237,957) $ 21.73
Forfeited (60,115) $ 15.74
Outstanding on December 31, 2015 774,545 $ 19.13
Stock Options
The following table summarizes information about stock option activity for the year ended December 31, 2015:
Shares
Under
Option
Weighted
Average
Exercise Price
Per Share
Weighted Average
Remaining
Contractual Life
(Years)
Outstanding on December 31, 2014 781,321 $ 22.56
Granted 783,476 $ 15.31
Forfeited (44,002) $ 20.25
Outstanding on December 31, 2015 1,520,795 $ 18.89 6.17
Exercisable on December 31, 2015 273,205 $ 22.61 5.73
Expected to vest December 31, 2015 1,247,590 $ 18.08 6.27
There was no intrinsic value of options outstanding and exercisable due to the fact that the market price of the Company’s common stock as of December 31, 2015
was below the weighted average exercise price of options. There were no options exercises in 2015.
The weighted average grant date fair value of options granted for the years ended December 31, 2015 and 2014 was $5.94 and $7.74, respectively. The total fair
value of options that vested during the year ended December 31, 2015 was $2 million. No options vested during the year ended December 31, 2014 and no options
were granted during the four months ended December 31, 2013. Compensation cost related to stock options for the years ended December 31, 2015 and 2014 was
$4 million and $1 million, respectively.
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