Stock-Based Compensation

Equity Classified Share-Based Awards

Stock-based compensation expense recognized for our equity classified share-based awards was $8 million for each of the three months ended September 30, 2015 and 2014, and $24 million and $25 million for the nine months ended September 30, 2015 and 2014, respectively. We did not record any significant tax benefits related to stock-based compensation expense in any period as we are not benefiting from a significant portion of our deferred tax assets, including deductions related to stock-based compensation expense. In addition, we did not capitalize any stock-based compensation expense as part of the cost of an asset for the nine months ended September 30, 2015 and 2014. At September 30, 2015, there was unrecognized compensation cost of $31 million related to restricted stock which is expected to be recognized over a weighted average period of 1.2 years.

A summary of our restricted stock and restricted stock unit activity for the Calpine Equity Incentive Plans for the nine months ended September 30, 2015, is as follows:



	Number of Restricted Stock Awards	Weighted Average Grant-Date Fair Value
Nonvested — December 31, 2014	4,201,868	$	18.01
Granted	1,577,932	$	21.40
Forfeited	240,259	$	19.64
Vested	1,589,073	$	16.54
Nonvested — September 30, 2015	3,950,468	$	19.85

The total fair value of our restricted stock and restricted stock units that vested during the nine months ended September 30, 2015 and 2014 was approximately $34 million and $31 million, respectively.

Liability Classified Share-Based Awards

Performance share units granted under the Equity Plan are settled in cash with payouts based on the relative performance of Calpine’s TSR over a three-year performance period compared with the TSR performance of the S&P 500 companies over the same period. The performance share units vest on the last day of the performance period and will be settled in cash; thus, these awards are classified as a liability and measured at fair value using a Monte Carlo simulation model at each reporting date until settlement. Stock-based compensation expense recognized related to our liability classified share-based awards was $(1) million and nil for the three months ended September 30, 2015 and 2014, respectively, and $(5) million and $5 million for the nine months ended September 30, 2015 and 2014, respectively.

A summary of our performance share unit activity for the nine months ended September 30, 2015, is as follows:



	Number of Performance Share Units	Weighted Average Grant-Date Fair Value
Nonvested — December 31, 2014	867,479	$	21.93
Granted	365,667	$	23.91
Forfeited	89,117	$	22.33
Vested⁽¹⁾	8,254	$	22.56
Nonvested — September 30, 2015	1,135,775	$	22.53

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(1)	In accordance with the applicable performance share unit agreements, performance share units granted to employees who meet the retirement eligibility requirements stipulated in the Equity Plan are fully vested upon the later of the date on which the employee becomes eligible to retire or one-year anniversary of the grant date.

For a further discussion of the Calpine Equity Incentive Plans, see Note 12 in our 2014 Form 10-K.