TripAdvisor 2014 Annual Report Download - page 89

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Aggregate intrinsic value represents the difference between the closing stock price of our common stock and the exercise price
of outstanding, in-the-money options. Our closing stock price as reported on NASDAQ as of December 31, 2014 was $74.66. The
total intrinsic value of stock options exercised for the years ended December 31, 2014, 2013, and 2012 were $75 million, $58 million,
and $25 million, respectively.
The fair value of stock option grants under the 2011 Plan and Viator Plan has been estimated at the date of grant using the
Black–Scholes option pricing model with the following weighted average assumptions for the periods presented:
December 31,
2014 2013 2012
Risk free interest rate ................................................. 1.79%1.41% 1.03 %
Expected term (in years) ............................................ 5.80 6.06 6.21
Expected volatility ..................................................... 44.04%50.78% 53.46 %
Expected dividend yield ............................................. — % — % — %
The weighted-average grant date fair value of options granted, excluding assumed acquisition-related options, was $46.65,
$28.30, and $20.36 for the years ended December 31, 2014, 2013 and 2012, respectively. The weighted-average grant date fair value
of assumed acquisition-related options was $80.31 for the year ended December 31, 2014. There were no assumed acquisition-related
options granted for the years ended December 31, 2013 and 2012. The total fair value of stock options vested for the years ended
December 31, 2014, 2013, and 2012 were $34 million, $27 million, and $10 million, respectively.
2014 RSU Activity
During the year ended December 31, 2014, we issued 752,460 RSUs under the 2011 Incentive Plan for which the fair value was
measured based on the quoted price of our common stock on the date of grant. These RSUs generally vest over a four-year requisite
service period.
The following table presents a summary of our RSU activity:
Weighted
Average
Grant- Aggregate
RSUs Date Fair Intrinsic
Outstanding Value Per Share Value
(in thousands) (in millions)
Unvested RSUs outstanding as of December 31, 2013 ..................................... 1,135 49.64
Granted .............................................................................................................. 752 93.36
Vested and released (1) ..................................................................................... (307) 46.78
Cancelled ........................................................................................................... (132) 67.50
Unvested RSUs outstanding as of December 31, 2014 ..................................... 1,448 $ 71.33 $ 108
(1) Inclusive of 103,641 RSUs withheld to satisfy employee minimum tax withholding requirements due to net share settlement.
Potential shares which had been convertible under RSUs that were withheld under net share settlement remain in the authorized
but unissued pool under the 2011 Plan and can be reissued by the Company. Total payments for the employees’ tax obligations
to the taxing authorities due to net share settlements are reflected as a financing activity within the consolidated statements of
cash flows.
Other Equity Activity
Upon Spin-Off, we entered into a warrant agreement (the “Warrant Agreement”) with Mellon Investor Services LLC and issued
warrants exercisable for TripAdvisor common stock in respect of previously outstanding warrants exercisable for Expedia common
stock that were adjusted on account of Expedia’s reverse stock split and the Spin-Off. In total, at Spin-Off, the warrants could have
been converted into a maximum of 8,046,698 shares of our common stock without any further adjustments to the Warrant Agreement
and had an expiration date of May 7, 2012.