Morgan Stanley 2015 Annual Report Download - page 231

MORGAN STANLEY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Unvested RSU Activity.
2015
Number of Shares
Weighted Average
Grant Date Fair
Value
(shares in millions)
Unvested RSUs at beginning of period ......................................... 87 $ 26.44
Granted .............................................................. 34 34.76
Vested ............................................................... (48) 27.06
Canceled ............................................................. (3) 28.72
Unvested RSUs at end of period(1) ............................................ 70 29.91
(1) Unvested RSUs represent awards where recipients have yet to satisfy either the explicit vesting terms or retirement-eligible requirements. At December 31,
2015, approximately 63 million unvested RSUs with a weighted average grant date fair value of $29.84 were expected to vest.
The aggregate fair value of awards that vested during 2015, 2014 and 2013 was $1,693 million, $1,517 million and $842
million, respectively.
Stock Options.
Stock options generally have an exercise price not less than the fair value of the Company’s common stock on the date of
grant, vest and become exercisable over a three-year period and expire five to 10 years from the date of grant, subject to
accelerated expiration upon certain terminations of employment. Stock options have vesting, restriction and cancellation
provisions that are generally similar to those of RSUs. The weighted average fair value of the Company’s stock options
granted during 2013 was $5.41, utilizing the following weighted average assumptions.
Weighted Average Assumptions.
Grant Year
Risk-Free Interest
Rate
Expected
Life
Expected Stock
Price Volatility
Expected Dividend
Yield
2013 ............................................... 0.6% 3.9 years 32.0% 0.9%
No stock options were granted during 2015 or 2014.
The Company’s expected option life has been determined based upon historical experience. The expected stock price
volatility assumption was determined using the implied volatility of exchange-traded options, in accordance with accounting
guidance for share-based payments. The risk-free interest rate was determined based on the yields available on U.S. Treasury
zero-coupon issues.
Stock Option Activity.
2015
Number of Options
Weighted Average
Exercise Price
(options in millions)
Options outstanding at beginning of period ..................................... 19 $ 51.30
Expired ............................................................. (2) 45.32
Options outstanding at end of period(1) ........................................ 17 52.26
Options exercisable at end of period ........................................... 15 55.02
(1) At December 31, 2015, approximately 16 million options with a weighted average exercise price of $52.43 were vested.
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