Common Stock

Equity Plans — We have granted a variety of awards, including common stock, restricted stock, restricted stock units, performance units, stock appreciation rights (“SARs”), and stock options to our directors, officers, and employees.

Accounting Methods — We recorded compensation expense (net of taxes) of less than $1 million in each of the three month periods ended June 30, 2016 and 2015 and less than $1 million and $1 million in compensation expense for the six month periods ended June 30, 2016 and 2015, respectfully, related to nonqualified stock options as part of our selling, general and administrative expense. This had no impact on basic or diluted earnings per share for each of the three month periods ended June 30, 2016 and 2015 and a decrease of $0.01 and $0.02 in both basic and diluted earnings per share for the six month periods ended June 30, 2016 and 2015, respectively.

For employees eligible to retire at the grant date, we immediately expense stock options and restricted stock. If employees become eligible to retire during the vesting period, we immediately recognize any remaining expense associated with their stock options and restricted stock.

As of June 30, 2016, there was approximately $1 million of unrecognized compensation costs related to our stock option awards that we expect to recognize over a weighted average period of 0.5 years.

Compensation expense for restricted stock, restricted stock units, long-term performance units and SARs (net of taxes) was $3 million and $4 million for the three month periods ended June 30, 2016 and 2015, respectively, and $9 million and $10 million for the six month periods ended June 30, 2016 and 2015, respectively, and was recorded in selling, general, and administrative expense in our condensed consolidated statements of income.

Cash received from stock option exercises for the six month periods ended June 30, 2016 and 2015 was $4 million.

Stock options exercised in the first six months of 2016 and 2015 generated a tax benefit of $1 million and $6 million, respectively. We started to record this tax effect in the third quarter of 2013 when we began utilizing our federal and state NOLs.

Stock Options — The following table reflects the status and activity for all options to purchase common stock for the period indicated:



	Six Months Ended June 30, 2016
	Shares Under Option		Weighted Avg. Exercise Prices		Weighted Avg. Remaining Life in Years	Aggregate Intrinsic Value
						(Millions)
Outstanding Stock Options
Outstanding, January 1, 2016	1,144,719		$	34.69	3.7	$	19
Exercised	(19,192	)	9.31			1
Outstanding, March 31, 2016	1,125,527		$	35.12	3.5	$	12
Forfeited	(788	)	51.88
Exercised	(183,774	)	23.07			5
Outstanding, June 30, 2016	940,965		$	37.46	3.1	$	14

There were no stock options granted in 2015 or 2016. The total fair value of shares vested from options that were granted prior to 2015 was $2 million and $4 million for the periods ended June 30, 2016 and 2015, respectively.

Restricted Stock — The following table reflects the status for all nonvested restricted shares for the period indicated:



	Six Months Ended June 30, 2016
	Shares		Weighted Avg. Grant Date Fair Value
Nonvested Restricted Shares
Nonvested balance at January 1, 2016	496,842		$	51.65
Granted	347,398		35.98
Vested	(156,109	)	46.50
Nonvested balance at March 31, 2016	688,131		$	44.90
Vested	(20,221	)	42.32
Forfeited	(32,192	)	53.91
Nonvested balance at June 30, 2016	635,718		$	44.42

The fair value of restricted stock grants is usually equal to the average of the high and low trading price of our stock on the date of grant. As of June 30, 2016, approximately $19 million of total unrecognized compensation costs related to restricted stock awards is expected to be recognized over a weighted-average period of approximately 2.2 years. The total fair value of restricted shares vested was $8 million and $6 million at June 30, 2016 and 2015, respectively.

In January 2015, our Board of Directors approved a share repurchase program, authorizing our company to repurchase up to $350 million of our outstanding common stock over a three-year period. This repurchase program does not obligate Tenneco to make repurchases at any specific time or situation and is part of our overall capital allocation strategy. In October 2015, our Board of Directors expanded our company's share repurchase plan, authorizing the repurchase of an additional $200 million of our company's outstanding common stock. This authorization is in addition to the $350 million share repurchase program our company announced in January 2015. We repurchased 1.1 million shares for $57 million through this program in the six months ended June 30, 2016. Since we announced the current share repurchase program in January 2015, we have repurchased 5.4 million shares for $270 million through June 30, 2016.

Treasury stock shares including repurchased shares were 8,606,130 and 7,473,325 shares at June 30, 2016 and December 31, 2015, respectively.

Long-Term Performance Units, Restricted Stock Units and SARs — Long-term performance units, restricted stock units and SARs are paid in cash and recognized as a liability based upon their fair value. As of June 30, 2016, $25 million of total unrecognized compensation costs is expected to be recognized over a weighted-average period of approximately 1.2 years.