iHeartMedia 2014 Annual Report Download - page 104

IHEARTCOMMUNICATIONS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
102
The following table presents a summary of CCOH’s restricted stock and restricted stock units outstanding at and activity during the
year ended December 31, 2014 (“Price” reflects the weighted average share price at the date of grant):
(In thousands, except per share data)
Awards
Price
Outstanding, January 1, 2014
1,892
$
6.83
Granted
1,040
8.88
Vested (restriction lapsed)
(64)
6.86
Forfeited
(410)
7.76
Outstanding, December 31, 2014
2,458
7.54
Share-Based Compensation Cost
The share-based compensation cost is measured at the grant date based on the fair value of the award and is recognized as expense on
a straight-line basis over the vesting period. Share-based compensation payments are recorded in corporate expenses and were
$10.7 million, $16.7 million and $28.5 million, during the years ended December 31, 2014, 2013 and 2012, respectively.
The tax benefit related to the share-based compensation expense for the years ended December 31, 2014, 2013 and 2012 was
$4.1 million, $6.3 million and $10.8 million, respectively.
As of December 31, 2014, there was $22.4 million of unrecognized compensation cost related to unvested share-based compensation
arrangements that will vest based on service conditions. This cost is expected to be recognized over a weighted average period of
approximately three years. In addition, as of December 31, 2014, there was $24.7 million of unrecognized compensation cost related
to unvested share-based compensation arrangements that will vest based on market, performance and service conditions. This cost
will be recognized when it becomes probable that the performance condition will be satisfied.
Parent completed a voluntary stock option exchange program on November 19, 2012 and exchanged 2.0 million stock options granted
under the Clear Channel 2008 Executive Incentive Plan for 1.8 million replacement restricted share awards with different service and
performance conditions. Parent accounted for the exchange program as a modification of the existing awards under ASC 718 and will
recognize incremental compensation expense of approximately $1.7 million over the service period of the new awards. In connection
with the exchange program, Parent granted an additional 1.5 million restricted stock awards pursuant to a tax assistance program
offered to employees participating in the exchange. Of the total 1.5 million restricted stock awards granted, 0.9 million were
repurchased by Parent upon expiration of the exchange program while the remaining 0.6 million awards were forfeited. Parent
recognized $2.6 million of expense related to the awards granted in connection with the tax assistance program.
NOTE 11 – EMPLOYEE STOCK AND SAVINGS PLANS
The Company has various 401(k) savings and other plans for the purpose of providing retirement benefits for substantially all
employees. Under these plans, an employee can make pre-tax contributions and the Company will match a portion of such an
employee’s contribution. Employees vest in these matching contributions based upon their years of service to the Company.
Contributions of $27.6 million, $26.6 million and $29.5 million to these plans for the years ended December 31, 2014, 2013 and 2012,
respectively, were expensed.
The Company offers a non-qualified deferred compensation plan for a select group of management or highly compensated employees,
under which such employees were able to make an annual election to defer up to 50% of their annual salary and up to 80% of their
bonus before taxes. The Company suspended all salary and bonus deferrals and company matching contributions to the deferred
compensation plan on January 1, 2010. The Company accounts for the plan in accordance with the provisions of ASC 710-10.
Matching credits on amounts deferred may be made in the Company’s sole discretion and the Company retains ownership of all assets
until distributed. Participants in the plan have the opportunity to allocate their deferrals and any matching credits among different
investment options, the performance of which is used to determine the amounts to be paid to participants under the plan. In
accordance with the provisions of ASC 710-10, the assets and liabilities of the non-qualified deferred compensation plan are presented
in “Other assets” and “Other long-term liabilities” in the accompanying consolidated balance sheets, respectively. The asset and
liability under the deferred compensation plan at December 31, 2014 was approximately $11.6 million recorded in “Other assets” and
$11.6 million recorded in “Other long-term liabilities”, respectively. The asset and liability under the deferred compensation plan at
December 31, 2013 was approximately $11.8 million recorded in “Other assets” and $11.8 million recorded in “Other long-term
liabilities”, respectively.