Equity

The following summarizes the changes in equity for the nine months ended September 30, 2014 (dollars in thousands):



	Common stock		Additional paid-in capital		Accumulated earnings less dividends			Accumulated other comprehensive loss			Total AvalonBay stockholders’ equity			Noncontrolling interests			Total equity

Balance at December 31, 2013	$	1,294	$	8,988,723	$	(345,254	)	$	(48,631	)	$	8,596,132		$	3,595		$	8,599,727

Net income attributable to common stockholders	—		—		540,929			—			540,929			—			540,929
Cash flow hedge loss reclassified to earnings	—		—		—			4,557			4,557			—			4,557
Change in redemption value of redeemable noncontrolling interest	—		—		4,088			—			4,088			—			4,088
Noncontrolling interests income allocation	—		—		—			—			—			14,221			14,221
Noncontrolling interests derecognition	—		—		—			—			—			(17,816		)	(17,816		)
Dividends declared to common stockholders	—		—		(455,531		)	—			(455,531		)	—			(455,531		)
Issuance of common stock, net of withholdings	26		334,207		(394		)	—			333,839			—			333,839
Amortization of deferred compensation	—		21,268		—			—			21,268			—			21,268

Balance at September 30, 2014	$	1,320	$	9,344,198	$	(256,162	)	$	(44,074	)	$	9,045,282		$	—		$	9,045,282

As of September 30, 2014 and December 31, 2013, the Company’s charter had authorized for issuance a total of 280,000,000 shares of common stock and 50,000,000 shares of preferred stock.

During the nine months ended September 30, 2014, the Company:

(i) issued 2,069,538 common shares through public offerings under CEP III, discussed below;

(ii) issued 454,728 common shares in connection with stock options exercised;

(iii) issued 1,868 common shares through the Company’s dividend reinvestment plan;

(iv) issued 113,822 common shares in connection with stock grants and the conversion of restricted stock units to restricted

shares;

(v) issued 4,367 common shares through the Employee Stock Purchase Program;

(vi) withheld 53,983 common shares to satisfy employees’ tax withholding and other liabilities; and

(vii) canceled 200 shares of restricted stock upon forfeiture.

Any deferred compensation related to the Company’s stock option and restricted stock grants during the nine months ended September 30, 2014 is not reflected on the Company’s Condensed Consolidated Balance Sheet as of September 30, 2014, and will not be reflected until earned as compensation cost.

In August 2012, the Company commenced a third continuous equity program (“CEP III”), under which the Company may sell up to $750,000,000 of shares of its common stock from time to time during a 36-month period. Actual sales will depend on a variety of factors to be determined by the Company, including market conditions, the trading price of the Company’s common stock and determinations by the Company of the appropriate sources of funding for the Company. In conjunction with CEP III, the Company engaged sales agents who receive compensation of approximately 1.5% of the gross sales price for shares sold. During the three and nine months ended September 30, 2014, the Company sold 650,579 and 2,069,538 shares at an average sales price of $153.68 and $144.95 per share, for net proceeds of $98,481,000 and $295,465,000, respectively. As of September 30, 2014, the Company had $346,304,000 of shares remaining authorized for issuance under this program.

On September 9, 2014, based on a market closing price of $155.83 per share on that date, the Company entered into a forward contract to sell 4,500,000 shares of common stock for an initial forward price of $151.74 per share, net of offering fees and discounts. The sales price and proceeds achieved by the Company will be determined on the date or dates of settlement, with adjustments during the term of the contract for the Company’s dividends as well as for a daily interest factor that varies with changes in the Fed Funds rate. The Company generally has the ability to determine the date(s) and method of settlement, subject to certain conditions and the right of the forward counterparty to accelerate settlement under certain circumstances. Settlement may be (i) physical sale of shares of our common stock for cash, (ii) net cash settlement, whereby the Company will either pay or receive the difference between the forward contract price and the weighted average market price for its common stock at the time of settlement, or (iii) net share settlement, whereby the Company will either receive or issue shares of its common stock, with the number of shares issued or received determined by the difference between the forward contract price and the weighted average market price for its common stock at the time of settlement. The forward contract price and the weighted average market price would in both cases by determined under the applicable terms of the forward contract. Under either of the net settlement provisions, the Company will pay to the counterparty either cash or shares of its common stock when the weighted average market price of its common stock at the time of settlement exceeds the forward contract price, and will receive either cash or issue shares of its common stock to the extent that the weighted average market price of its common stock at the time of settlement is less than the price under the forward contract. Settlement of the forward contract will occur on one or more dates not later than September 8, 2015.