TripAdvisor 2013 Annual Report Download - page 167

(2) The amounts reported in this column represent the aggregate grant date fair value of awards computed in
accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification Topic
718 (“ASC 718”), excluding the effect of estimated forfeitures. These amounts reflect an estimate of the
grant date fair value and may not correspond to the actual value that will be realized by our named executive
officers from their equity awards. Stock awards consist of RSUs valued using the closing price of
TripAdvisor’s common stock on the NASDAQ Stock Market on the grant date. Stock option awards were
valued at the date of grant using a Black-Scholes Merton option pricing model (the “Black-Scholes
Model”). The Black-Scholes Model incorporates various assumptions including expected volatility,
expected term, risk-free rate of return and expected dividend yield. The expected volatility for the awards
above was based on the average of our historical stock price volatility and certain peer group companies
based on daily price observations over a period equivalent or approximate to the expected term of the stock
option awards. The decision to use a weighted average volatility factor with our peer group was based upon
the relatively short period of availability of data on TripAdvisor common stock. The expected term was
based on using the simplified method for all stock options as we do not have sufficient historical exercise
data on TripAdvisor common stock. Our expected dividend yield is zero, as we have not paid any dividends
on TripAdvisor common stock to date and do not expect to pay any cash dividends for the foreseeable
future. The grant date fair value of the 2013 stock option awards was determined using the following
assumptions:
Expected
Term
(years)
Risk-Free
Interest Rate
(%)
Expected
Volatility
(%)
Expected
Dividend Yield
(% of grant
date closing
price)
6.25(a) 1.07(a) 51.75(a) 0.00(a)
5.75(b) 1.83(b) 49.64(b) 0.00(b)
(a) Grant date assumptions used to determine fair value of February 28, 2013 grants.
(b) Grant date assumptions used to determine fair value of August 28, 2013 grants.
(3) See the following table for additional information regarding the amounts reported in the “All Other
Compensation” column for 2013 above.
2013 All Other Compensation
Stephen
Kaufer ($)
Julie M.B.
Bradley ($)
Seth J.
Kalvert ($)
Gift Card(a) .......................................... 100 100 100
Tax Gross-Up on Gift Card(b) ........................... 40 40 40
401(k) Company Match(c) .............................. 7,650 7,650 5,990
Dividend Equivalents(d) ................................ 2,311 875 717
(a) Represents the amount of a gift card that was given to all employees as a holiday bonus.
(b) Represents the amount of the tax gross-up paid in connection with the gift cards described above.
(c) Represents matching contributions of TripAdvisor under the TripAdvisor Retirement Savings Plan as in
effect through December 31, 2013, pursuant to which TripAdvisor matches $0.50 for each dollar a
participant contributes, up to the first 6% of eligible compensation, subject to limits imposed by the Code.
(d) Represents amounts paid in cash for accrued dividend equivalents on vested RSUs that were assumed by
TripAdvisor in the Spin-Off.
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