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DR PEPPER SNAPPLE GROUP, INC.
NOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS
(Continued)
98
PERFORMANCE SHARE UNITS
In 2011, the Compensation Committee of the Board approved a PSU plan. Each PSU is equivalent in value to one share of
the Company's common stock. PSUs will vest three years from the beginning date of a pre-determined performance period to the
extent the Company has met two performance criteria during the performance period: (i) the percentage growth of net income and
(ii) the percentage yield from operating free cash flow.
The table below summarizes PSU activity for the year ended December 31, 2014. The fair value of performance share units
is determined based on the number of units granted and the grant date price of common stock.
PSUs
Weighted
Average Grant
Date Fair
Value
Weighted
Average
Remaining
Contractual
Term (Years)
Aggregate
Intrinsic Value
(in millions)
Outstanding as of January 1, 2014 422,866 $ 39.88 1.26 $ 21
Granted 154,157 51.88
Vested and released (104,165) 36.42 5
Forfeited (28,577) 38.16
Outstanding as of December 31, 2014 444,281 44.97 1.07 32
As of December 31, 2014, there was $14 million of unrecognized compensation cost related to unvested PSUs granted under
the DPS Stock Plans that is expected to be recognized over a weighted average period of 1.46 years.
During the year ended December 31, 2014, 104,165 shares subject to previously granted PSUs vested. A majority of these
vested PSUs were net share settled. The Company withheld 30,944 shares based upon the Company's closing stock price on the
vesting date to settle the employees' minimum statutory obligation for the applicable income and other employment taxes.
Subsequently, the Company remitted the required funds to the appropriate taxing authorities.
Total payments for the employees' tax obligations to the relevant taxing authorities were $2 million for the year ended
December 31, 2014. There were no payments made to the relevant taxing authorities for the years ended December 31, 2013 and
December 31, 2012 for the employees' tax obligations as the Company did not have any PSUs that were vested and released. These
payments are reflected as a financing activity within the consolidated statements of cash flows. These payments were used for tax
withholdings related to the net share settlements of PSUs and dividend equivalent units. These payments had the effect of share
repurchases by the Company as they reduced the number of shares that would have otherwise been issued on the vesting date and
were recorded as a reduction of additional paid-in capital.