IHOP 2014 Annual Report Download - page 108

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DineEquity, Inc. and Subsidiaries
Notes to the Consolidated Financial Statements (Continued)
13. Stock-Based Incentive Plans (Continued)
89
As of December 31, 2014, total unrecognized compensation cost related to restricted stock and restricted stock units of
$9.1 million and $3.2 million related to stock options is expected to be recognized over a weighted average period of
approximately 1.49 years for restricted stock and restricted stock units and 1.37 years years for stock options.
Equity Classified Awards - Stock Options
The per share fair values of the stock options granted have been estimated as of the date of grant using the Black-Scholes
option pricing model. The Black-Scholes model considers, among other factors, the expected life of the option and the
historical volatility of the Company's stock price. The Black-Scholes model meets the requirements of U.S. GAAP, but the fair
values generated by the model may not be indicative of the actual fair values of the Company's stock-based awards. The
following table summarizes the assumptions used to value options granted in the respective periods:
2014 2013 2012
Risk free interest rate ...................................................................................... 1.6% 0.8% 0.9%
Weighted average historical volatility............................................................. 51.1% 83.4% 84.5%
Dividend yield................................................................................................. 3.7% 4.2% —%
Expected years until exercise.......................................................................... 4.6 4.6 4.7
Forfeitures ....................................................................................................... 11.0% 11.0% 11.0%
Weighted average fair value of options granted.............................................. $ 26.87 $ 36.00 $ 33.53
Stock option activity for the years ended December 31, 2014, 2013 and 2012 is summarized as follows:
Number of
Shares Under
Option
Weighted
Average
Exercise Price
Per Share
Weighted
Average
Remaining
Contractual
Term (in Years)
Aggregate
Intrinsic
Value
(in Millions)
Outstanding at December 31, 2011 ..................................... 1,318,640 $ 32.06
Granted ................................................................................ 147,674 51.63
Exercised ............................................................................. (455,217) 20.91
Forfeited .............................................................................. (39,381) 46.97
Expired ................................................................................ (13,470) 38.64
Outstanding at December 31, 2012 ..................................... 958,246 39.67
Granted ................................................................................ 81,328 72.28
Exercised ............................................................................. (225,272) 40.31
Forfeited .............................................................................. (39,243) 55.78
Outstanding at December 31, 2013 ..................................... 775,059 42.09
Granted ................................................................................ 120,932 81.53
Exercised ............................................................................. (256,910) 31.95
Forfeited .............................................................................. (20,966) 69.18
Outstanding at December 31, 2014 ..................................... 618,115 $ 53.10 6.0 $ 31.2
Vested and Expected to Vest at December 31, 2014............ 600,708 $ 52.36 5.9 $ 30.8
Exercisable at December 31, 2014 ...................................... 433,793 $ 44.09 4.8 $ 25.8
The total intrinsic value of options exercised during the years ended December 31, 2014, 2013 and 2012 was $13.2
million, $7.5 million and $15.0 million, respectively.
Cash received from options exercised under all stock-based payment arrangements for the years ended December 31, 2014,
2013 and 2012 was $8.2 million, $9.1 million and $9.3 million, respectively. The actual tax benefit realized for the tax
deduction from option exercises under the stock-based payment arrangements totaled $4.3 million, $3.7 million and $6.2
million, respectively, for the years ended December 31, 2014, 2013 and 2012.