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Table of Contents VMware, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
The options exercised during the years ended December 31, 2014 , 2013 and 2012 had a pre-tax intrinsic value of $147 million , $256
million and $443 million , respectively.
Cash proceeds from the exercise of EMC stock options paid to EMC were $8 million , $11 million and $9 million for the years ended
December 31, 2014 , 2013 and 2012 , respectively. The pre-tax intrinsic value of EMC stock options held by VMware employees that were
exercised during the years ended December 31, 2014 , 2013 and 2012 were $7 million , $8 million and $11 million , respectively.
VMware Restricted Stock
VMware restricted stock primarily consists of restricted stock unit (“RSU”) awards granted to employees. RSUs are valued based on the
VMware stock price on the date of grant, and shares underlying RSU awards are not issued until the RSUs vest. Upon vesting, each RSU
converts into one share of VMware Class A common stock.
VMware restricted stock also includes performance stock unit (“PSU”) awards, which have been granted to certain of VMware’s executives
and employees. The PSU awards include performance conditions and, in certain cases, a time-
based vesting component. Upon vesting, each PSU
award will convert into VMware’s Class A common stock at various ratios ranging from 0.5 to 3.0 shares per PSU, depending upon the degree
of achievement of the performance target designated by each individual award. As of December 31, 2014 , the performance period for the
outstanding PSU awards was concluded. The number of PSUs outstanding as of December 31, 2014
reflects the PSU awards ultimately expected
to vest, subject to certain service conditions.
The following table summarizes restricted stock activity since January 1, 2012 (units in thousands):
As of December 31, 2014 , the 12.6 million units outstanding included 11.9 million of RSUs and 0.6 million of PSUs. The above table
includes RSUs issued for outstanding unvested RSUs in connection with business combinations.
Restricted stock that is expected to vest as of December 31, 2014 was as follows:
(1)
The aggregate intrinsic values represent the total pre-tax intrinsic values based on VMware's closing stock price of $82.52 as of December 31, 2014 , which would have been
received by the RSU holders had the RSUs been issued as of December 31, 2014 .
The total fair value of VMware RSUs, PSUs, and restricted stock that vested during the years ended December 31, 2014 , 2013 and 2012
was $480 million , $340 million and $347 million , respectively. As of December 31, 2014 , restricted stock
92
Number of Units
Weighted-
Average Grant
Date Fair
Value
(per unit)
Outstanding, January 1, 2012
9,540
$
72.74
Granted
7,832
101.73
Vested
(3,751
)
69.01
Forfeited
(1,451
)
81.53
Outstanding, December 31, 2012
12,170
91.93
Granted
7,391
76.20
Vested
(4,399
)
83.21
Forfeited
(2,306
)
90.55
Outstanding, December 31, 2013
12,856
85.85
Granted
6,189
92.82
Vested
(5,166
)
86.27
Forfeited
(1,294
)
88.03
Outstanding, December 31, 2014
12,585
88.88
Number of Units
(in thousands)
Weighted Average
Remaining Term (in
years)
Aggregate Intrinsic
Value
(1)
(in millions)
Expected to vest, December 31, 2014
10,989
1.33
$
907