Shareholders' Equity

6 Months Ended

Jun. 30, 2016

Equity [Abstract]

Shareholders' Equity

15. Shareholders’ Equity

Capital Stock

SNI’s capital structure includes Common Voting Shares and Class A Common Shares. Our Amended and Restated Articles of Incorporation provide that the holders of Class A Common Shares, who are not entitled to vote on any other matters except as required by Ohio law, are entitled to elect the greater of three or one-third of the directors. The Common Voting Shares and Class A Common Shares have equal dividend distribution rights.

Incentive Plans

The Scripps Networks Interactive, Inc. 2015 Long-Term Incentive Plan (the “2015 LTI Plan”) provides for long-term equity incentive compensation for key employees and members of the Company’s Board of Directors (the “Board”). The 2015 LTI Plan authorizes the grant of equity-based compensation to non-employee directors, officers and other key employees in the form of incentive or non-qualified stock options, stock appreciation rights, restricted shares, restricted stock units (“RSUs”), performance shares, performance units and other share-based awards and dividend equivalents. The Company has reserved 8.0 million Class A Common Shares for issuance under the 2015 LTI Plan.

The 2015 LTI Plan will remain in effect until February 2025, unless terminated sooner by the Board. Termination will not affect outstanding grants and awards. The 2015 LTI Plan replaced the Scripps Networks Interactive, Inc. 2008 Long-Term Incentive Plan (the “Prior LTI Plan”), and no further awards will be made under the Prior LTI Plan. However, awards granted under the Prior LTI Plan remain outstanding in accordance with their terms.

We satisfy stock option exercises and vested stock awards with newly-issued shares. Shares available for future share compensation grants totaled 6.9 million at June 30, 2016.

During the six months ended June 30, 2016, the Company granted 0.6 million stock options and less than 0.4 million RSUs, including performance-based restricted stock units (“PBRSUs”) under the 2015 LTI Plan. During the six months ended June 30, 2015, the Company granted 0.4 million stock options and 0.3 million RSUs, including PBRSUs. The number of shares ultimately issued for PBRSUs will depend upon performance compared to specified metrics. The fair values for stock options are estimated on the grant date using a lattice-based binomial model. Assumptions utilized in the model are evaluated and revised, as necessary, to reflect market conditions and experience.

Share-based compensation costs totaled $7.0 million and $7.1 million for the three months ended June 30, 2016 and June 30, 2015, respectively, and $24.7 million and $24.3 million for the six months ended June 30, 2016 and June 30, 2015, respectively.

As of June 30, 2016, unrecognized share-based compensation expense was as follows:

(in thousands)	Amount		Weighted-Average Period
Stock options	$	2,921	2.4 years
RSUs and PBRSUs		21,780	1.8 years
Total unrecognized share-based compensation	$	24,701

Share Repurchase Programs

We have share repurchase programs (“Repurchase Programs”) authorized by the Board that permit us to acquire the Company’s Class A Common Shares. We did not repurchase any shares during the three months ended June 30, 2016 and June 30, 2015, respectively. We did not repurchase any shares for the six months ended June 30, 2016. During the six months ended June 30, 2015, we repurchased 4.0 million shares for approximately $289.5 million, including 3.0 million shares repurchased for approximately $216.8 million from Scripps family members.

As of June 30, 2016, $1,512.5 million in authorization remains available for repurchase under the Repurchase Programs. All shares repurchased under the Repurchase Programs are retired and returned to authorized and unissued shares. There is no expiration date for the Repurchase Programs, and we are under no commitment or obligation to repurchase any particular amount of Class A Common Shares under the Repurchase Programs.