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Notes to Consolidated Financial Statements
International Business Machines Corporation and Subsidiary Companies
129
The tables below summarize RSU and PSU activity under the Plans during the years ended December31, 2014, 2013 and 2012.
RSUs
2014 2013 2012
Weighted-
Average
Grant Price
Number
of Units
Weighted-
Average
Grant Price
Number
of Units
Weighted-
Average
Grant Price
Number
of Units
Balance at January1 $166 8,635,317 $148 9,841,461 $129 12,218,601
RSUs granted 172 2,525,947 189 2,541,081 184 2,635,772
RSUs released 157 (2,401,761) 131 (2,952,363)117 (4,338,787)
RSUs canceled/forfeited 167 (1,025,226) 154 (794,862)139 (674,125)
Balance at December 31 $171 7,734,277 $166 8,635,317 $148 9,841,461
PSUs
2014 2013 2012
Weighted-
Average
Grant Price
Number
of Units
Weighted-
Average
Grant Price
Number
of Units
Weighted-
Average
Grant Price
Number
of Units
Balance at January1 $178 2,824,294 $151 3,172,201 $122 3,686,991
PSUs granted at target 180 1,430,098 195 869,875 185 1,004,003
Additional shares earned above target* 157 29,960 118 152,069 102 550,399
PSUs released 157 (1,027,181) 118 (1,321,784)102 (1,998,746)
PSUs canceled/forfeited 187 (116,464) 170 (48,067)131 (70,446)
Balance at December 31** $185 3,140,707 $178 2,824,294 $151 3,172,201
* Represents additional shares issued to employees after vesting of PSUs because final performance metrics exceeded specified targets.
** Represents the number of shares expected to be issued based on achievement of grant date performance targets. The actual number of shares issued will depend on final
performance against specified targets over the vesting period.
RSUs are stock awards granted to employees that entitle the
holder to shares of common stock as the award vests, typically
over a one- to five-year period. For RSUs, dividend equivalents
are not paid. The fair value of such RSUs is determined and fixed
on the grant date based on the company’s stock price adjusted
for the exclusion of dividend equivalents.
The remaining weighted-average contractual term of RSUs at
December31, 2014, 2013 and 2012 is the same as the period over
which the remaining cost of the awards will be recognized, which
is approximately three years. The fair value of RSUs granted during
the years ended December31, 2014, 2013 and 2012 was $434 mil
-
lion, $481 million and $486 million, respectively. The total fair value
of RSUs vested and released during the years ended December31,
2014, 2013 and 2012 was $378 million, $386 million and $509 mil-
lion, respectively. As of December31, 2014, 2013 and 2012, there
was $754 million, $871 million and $938 million, respectively, of
unrecognized compensation cost related to non-vested RSUs. The
company received no cash from employees as a result of employee
vesting and release of RSUs for the years ended December31,
2014, 2013 and 2012. In the second quarter of 2011, the company
granted equity awards valued at approximately $1thousand each
to about 400,000 non-executive employees. These awards were
made under the Plans and vest in December 2015.
specific cycle dates scheduled in advance. With respect to awards
given in connection with promotions or new hires, the company’s
policy requires approval of such awards prior to the grant date,
which is typically the date of the promotion or the date of hire.
Stock Awards
Stock awards are made in the form of Restricted Stock Units
(RSUs), including Retention Restricted Stock Units (RRSUs), or
Performance Share Units (PSUs).