Equity

We currently sponsor employee and director stock option and restricted stock plans. Stock options and restricted stock are granted at the discretion of the compensation committee of the board of directors. All stock options and restricted stock awards are granted at an exercise price equal to the fair value of the common stock on the date of grant. The grant date fair value is based on the closing stock price on the date of grant. The fair value of the stock options and restricted stock on the date of grant is recognized as expense over the vesting period, net of estimated forfeitures. The non-cash compensation expenses recognized in our consolidated statements of income for stock options and restricted stock were $90 million and $79 million for the nine months ended September 30, 2016 and 2015, respectively, and $30 million and $32 million for the three months ended September 30, 2016 and 2015, respectively.

Stock Option Plans

The following is a summary of stock options for the nine months ended September 30, 2016:



	Number of Options		Weighted Average Exercise Price per Option
Outstanding at December 31, 2015	774,551		$	159.66
Granted	150,323		250.07
Exercised	(135,048	)	146.26
Outstanding at September 30, 2016	789,826		179.16

Details of stock options outstanding as of September 30, 2016 are as follows:



	Number of Options	Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)	Aggregate Intrinsic Value (In millions)
Vested or expected to vest	789,826	$	179.16	6.8	$	71
Exercisable	544,367	$	154.58	5.9	$	62

The total intrinsic value of stock options exercised during the nine months ended September 30, 2016 and 2015 were $15 million and $19 million, respectively, and $5 million for both the three months ended September 30, 2016 and 2015. As of September 30, 2016, there were $9 million in total unrecognized compensation costs related to stock options. These costs are expected to be recognized over a weighted average period of 1.8 years as the stock options vest.

We use the Black-Scholes option pricing model for purposes of valuing stock option awards. During the nine months ended September 30, 2016 and 2015, we used the weighted-average assumptions in the table below to compute the value of all options for shares of common stock granted to employees:



	Nine Months Ended September 30,
Assumptions:	2016			2015
Risk-free interest rate	1.51		%	1.08		%
Expected life in years	5.0			5.0
Expected volatility	24		%	24		%
Expected dividend yield	1.36		%	1.25		%
Estimated weighted-average fair value of options granted per share	$	49.39		$	40.94

The risk-free interest rate is based on the zero-coupon U.S. Treasury yield curve in effect at the time of grant. The expected life computation is derived from historical exercise patterns and anticipated future patterns. Expected volatilities are based on historical volatility of our stock.

Restricted Stock Plans

In January 2016, we reserved a maximum of 330,924 restricted shares for potential issuance as performance-based restricted shares to certain of our employees. The number of shares that will ultimately be granted under the performance awards will be based on our actual financial performance as compared to financial performance targets set by our board of directors and compensation committee for the year ending December 31, 2016. The maximum compensation expense to be recognized under these performance-based restricted shares is $80 million if the maximum financial performance target is met and all 330,924 shares vest. The compensation expense to be recognized under these performance-based restricted shares will be $39 million if the target financial performance is met, which would result in 165,462 shares vesting. These restricted shares are also subject to a market condition that could reduce the number of shares that are ultimately granted. We will recognize expense on an accelerated basis over the three-year vesting period based on our quarterly assessment of the probable 2016 actual financial performance as compared to the 2016 financial performance targets. As of September 30, 2016, we determined that it is probable that the financial performance level will be at target for 2016. Based on this assessment, we recorded non-cash compensation expense of $17 million and $6 million for the nine and three months ended September 30, 2016, respectively, related to these shares and the remaining $22 million in non-cash compensation expense will be recorded on an accelerated basis over the remaining vesting period, including $7 million of which will be recorded over the remainder of 2016.

The following is a summary of the non-vested restricted shares for the nine months ended September 30, 2016:



	Number of Restricted Stock Shares	Weighted Average Grant-Date Fair Value per Share
Non-vested at December 31, 2015	1,254,235	$	199.44
Granted	614,479	249.43
Vested	(476,581)	188.73
Forfeited	(66,266)	227.27
Non-vested at September 30, 2016	1,325,867	225.54

Restricted stock shares granted in the table above include both time-based and performance-based grants. Performance-based shares have been presented to reflect the actual shares to be issued based on the achievement of past performance targets. Non-vested performance-based restricted shares granted are presented in the table above at the maximum number of restricted shares that would vest if the maximum performance targets are met. As of September 30, 2016, there were $147 million in total unrecognized compensation costs related to the time-based restricted stock and the performance-based restricted stock. These costs are expected to be recognized over a weighted-average period of 1.4 years as the restricted stock vests. These unrecognized compensation costs assume that a target performance level will be met on the performance-based restricted shares granted in January 2016. During the nine months ended September 30, 2016 and 2015, the total fair value of restricted stock vested under all restricted stock plans was $120 million and $91 million, respectively.

Stock Repurchase Program

During the nine months ended September 30, 2015, we repurchased 2,635,974 shares of our common stock for $605 million under a stock repurchase plan. In connection with our acquisition of Interactive Data during the fourth quarter of 2015, we suspended our stock repurchase plan and that plan expired shortly thereafter. We did not repurchase any of our outstanding common stock during the nine months ended September 30, 2016. We recorded the receipt of the shares repurchased as treasury stock.

The timing and extent of future repurchases, that are not made pursuant to a Rule 10b5-1 trading plan will be at our discretion and will depend upon many conditions. Our management and board of directors periodically review whether or not to be active in repurchasing our stock. In making a determination regarding any stock repurchases, we consider multiple factors. The factors may include: overall stock market conditions, our common stock price movements, the remaining amount authorized for repurchases by our board of directors, the potential impact of a stock repurchase program on our corporate debt ratings, our expected free cash flow and working capital needs, our current and future planned strategic growth initiatives, and other potential uses of our cash and capital resources.

In August 2016, our board of directors approved an aggregate of $1.0 billion for future repurchases of our common stock with no fixed expiration date, subject to applicable laws and regulations. Repurchases may be made from time to time on the open market, through established plans, in privately-negotiated transactions or otherwise, in accordance with all applicable securities laws, rules and regulations. We have entered into a Rule 10b5-1 trading plan to govern some or all of the repurchases of our shares of common stock, and we began to repurchase shares in October 2016. We may discontinue the stock repurchases at any time and may terminate the Rule 10b5-1 trading plan at any time. The approval of our board of directors for the share repurchases does not obligate us to acquire any particular amount of our common stock. In addition, our board of directors may increase or decrease the amount of capacity we have for repurchases from time to time.

Stock Split

In August 2016, our board of directors approved pursuing an effective 5-for-1 split of ICE’s common stock that would be distributed in the form of a four share stock dividend per share of common stock, subject to both SEC and stockholder approval of an amendment and restatement to our Certificate of Incorporation to increase our authorized shares of common stock and capital stock. We received SEC approval on September 29, 2016 and stockholder approval on October 12, 2016 for the adoption of an amendment and restatement of our Certificate of Incorporation. Our board of directors, through a designated dividend committee, declared a 5-for-1 stock split of our common stock in the form of a stock dividend on October 12, 2016. Stockholders of record as of the close of market on October 27, 2016 will receive four additional shares for each share of ICE common stock held on such record date. The new shares will be payable on November 3, 2016 and our common stock is expected to begin trading on a split-adjusted basis on November 4, 2016. As previously announced, we retired all of our outstanding treasury shares effective upon the October 27, 2016 record date.

Treasury Stock

During the nine months ended September 30, 2016 and 2015, we received 208,091 shares and 194,696 shares, respectively, of common stock from certain of our employees related to tax withholdings made by us on our employee’s behalf for restricted stock and stock option exercises. We recorded the receipt of the shares as treasury stock. Treasury stock activity is presented in the accompanying consolidated statements of changes in equity, accumulated other comprehensive loss and redeemable non-controlling interest.

In connection with the record date for the 5-for-1 stock split on October 27, 2016, all shares of common stock held by us as treasury shares were canceled and extinguished. Therefore, as of the close of market on October 27, 2016, all 7,054,703 outstanding treasury stock shares were retired. In connection with the retirement, of the $1.5 billion value assigned to the treasury stock shares, $1.1 billion was allocated to additional paid-in capital and $371 million was allocated to retained earnings. The amount allocated to additional paid-in capital was determined based on the paid-in capital per share generated from the historical issuances of these treasury shares.