Redbox 2013 Annual Report Download - page 82

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73
Certain information regarding stock options outstanding as of December 31, 2013, is as follows:
Options
Shares and intrinsic value in thousands Outstanding Exercisable
Number . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 248 114
Weighted average per share exercise price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 45.72 $ 38.88
Aggregate intrinsic value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 5,351 $ 3,237
Weighted average remaining contractual term (in years) . . . . . . . . . . . . . . . . . . . . . . . 5.77 3.29
Restricted stock awards
Restricted stock awards are granted to eligible employees, including executives, and non-employee directors. Awards granted to
employees and executives vest annually in equal installments over four years. Non-employee director awards vest one year
after the grant date. Performance-based restricted stock awards are granted to executives only, with established performance
criteria approved by the Compensation Committee of the Board of Directors. Awards of performance-based restricted stock
made prior to 2013, once earned, vest in equal installments over three years from the date of grant. Awards of performance-
based restricted stock made in 2013, once earned, vest in two installments over three years from the date of grant (65% of the
award vests two years from the date of grant and the remaining 35% of the award vests three years from the date of grant). The
restricted shares require no payment from the grantee. The fair value of performance-based awards is based on achieving
specific performance conditions and is recognized over the vesting period. The fair value of non-performance-based awards is
based on the market price on the grant date and is recognized on a straight-line basis over the vesting period.
The following table presents a summary of restricted stock award activity for 2013:
Shares in thousands
Restricted
Stock Awards
Weighted Average
Grant Date Fair
Value
NON-VESTED, December 31, 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 604 $ 48.95
Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 437 $ 53.94
Vested . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (230) $ 46.58
Forfeited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (214) $ 51.56
NON-VESTED, December 31, 2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 597 $ 52.58
Share-Based Payments for Content Arrangements
We granted restricted stock as part of content license agreements with certain movie studios. The expense related to these
agreements is included within direct operating expenses in our Consolidated Statements of Comprehensive Income and is
adjusted based on the number of unvested shares and market price of our common stock each reporting period.
Information related to the shares of restricted stock granted as part of these agreements as of December 31, 2013, is as follows:
Granted Vested Unvested
Remaining
Vesting Period
Sony. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 193,348 164,346 29,002 0.6 years
Paramount . . . . . . . . . . . . . . . . . . . . . . . . . . 300,000 180,000 120,000 1.0 year
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . 493,348 344,346 149,002
Rights to Receive Cash
As a part of the acquisition of ecoATM, we issued replacement awards for unvested restricted stock and options in ecoATM
with rights to receive cash equal to the per share merger consideration for restricted stock and net of the exercise price for
options. The replacement awards vest in accordance with the terms of the original replaced award. The fair value of the
original and replacement awards amounted to $32.1 million, $1.4 million of which was attributed to pre-combination services
rendered and included in the calculation of total consideration transferred. The replacement awards are considered liability
classified as they represent rights to receive cash. Expense associated with the post-combination awards will be recognized net
of forfeitures, and cash payments will be made, in accordance with the awards' vesting schedule, generally on a monthly basis.
See Note 3: Business Combinations for more information. We recognized $8.7 million in expense associated with the issuance