NOTE 7. EMPLOYEE BENEFIT PLANS

At September 30, 2016, approximately 7.1 million shares of common stock were available under our 2008 Stock Incentive Plan for future stock option grants and other incentive awards, including restricted stock units. Options have an exercise price equal to the fair market value of the shares on the date of grant and generally expire 10 years from the date of grant. A restricted stock unit is a contractual right to receive one share of our common stock or the equivalent value in cash in the future. Options and time-based restricted stock units typically vest one-third on each of the first three anniversary dates of the grant; however, certain special retention awards may have longer vesting periods. In addition, we grant performance-based restricted stock units (and, in prior years, have granted performance-based options) that vest subject to the achievement of specified performance goals within a specified timeframe.

Our Condensed Consolidated Statements of Operations for the nine months ended September 30, 2016 and 2015 include $46 million and $52 million, respectively, of pre-tax compensation costs related to our stock-based compensation arrangements recorded in salaries, wages and benefits.

Stock Options

The following table summarizes stock option activity during the nine months ended September 30, 2016:


		Weighted Average
		Exercise Price		Aggregate		Weighted Average
	Options	Per Share		Intrinsic Value		Remaining Life
					(In Millions)
Outstanding at December 31, 2015	1,606,842	$	22.87
Granted	—		—
Exercised	(110,715)		18.00
Forfeited/Expired	(53,456)		20.20
Outstanding at September 30, 2016	1,442,671	$	22.79	$	5	2.4	years
Vested and expected to vest at September 30, 2016	1,442,671	$	22.79	$	5	2.4	years
Exercisable at September 30, 2016	1,442,671	$	22.79	$	5	2.4	years

There were 110,715 stock options exercised during the nine months ended September 30, 2016 with an aggregate intrinsic value of approximately $1 million, and 321,619 stock options exercised during the same period in 2015 with an aggregate intrinsic value of approximately $8 million.

At September 30, 2016, there were no unrecognized compensation costs related to stock options. Also, there were no stock options granted in the nine months ended September 30, 2016 or 2015.

The following table summarizes information about our outstanding stock options at September 30, 2016:


	Options Outstanding					Options Exercisable
		Weighted Average
	Number of	Remaining		Weighted Average		Number of	Weighted Average
Range of Exercise Prices	Options	Contractual Life		Exercise Price		Options	Exercise Price
$0.00 to $4.569	178,969	2.4	years	$	4.56	178,969	$	4.56
$4.57 to $25.089	827,315	3.1	years		20.85	827,315		20.85
$25.09 to $32.569	182,000	0.4	years		26.40	182,000		26.40
$32.57 to $42.529	254,387	1.4	years		39.31	254,387		39.31
	1,442,671	2.4	years	$	22.79	1,442,671	$	22.79

Restricted Stock Units

The following table summarizes restricted stock unit activity during the nine months ended September 30, 2016:


	Restricted Stock	Weighted Average Grant
	Units	Date Fair Value Per Unit
Unvested at December 31, 2015	3,627,232	$	44.69
Granted	1,584,063		30.43
Vested	(1,542,039)		43.18
Forfeited	(348,694)		33.92
Unvested at September 30, 2016	3,320,562	$	38.54

In the nine months ended September 30, 2016, we granted 717,277 restricted stock units subject to time-vesting, of which 484,295 will vest and be settled ratably over a three-year period from the grant date, 57,139 will vest and be settled on the third anniversary of the grant date, and 175,843 will vest and be settled on the fifth anniversary of the grant date. In addition, in May 2016, we made an annual grant of 90,105 restricted stock units to our non-employee directors for the 2016-2017 board service year, which units vested immediately and will settle in shares of our common stock on the third anniversary of the date of the grant. In January 2016, following the appointment of two new members of our Board of Directors, we also made initial grants totaling 5,084 restricted stock units to these directors, as well as prorated annual grants totaling 5,614 restricted stock units. Both the initial grants and the annual grants vested immediately, however the initial grants will not settle until the directors’ separation from the Board, while the annual grants settle on the third anniversary of the grant date. In addition, we granted 474,443 performance-based restricted stock units to certain of our senior officers; the vesting of these restricted stock units is contingent on our achievement of specified three-year performance goals for the years 2016 to 2018. Provided the goals are achieved, the performance-based restricted stock units will vest and settle on the third anniversary of the grant date. The actual number of performance-based restricted stock units that could vest will range from 0% to 200% of the 474,443 units granted, depending on our level of achievement with respect to the performance goals. Moreover, in the nine months ended September 30, 2016, we granted 291,540 restricted stock units as a result of our level of achievement with respect to prior-year target performance goals.

At September 30, 2016, there were $83 million of total unrecognized compensation costs related to restricted stock units. These costs are expected to be recognized over a weighted average period of 2.0 years.