AbbVie 2013 Annual Report Download - page 94

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minimum return on equity. The fair value of RSAs and RSUs (including performance-based awards) is
determined based on the number of shares granted and the quoted price of the common stock on the
date of grant. AbbVie assumes that the performance goals will be achieved. If such goals are not met,
no compensation cost is recognized and any previously recognized compensation cost is reversed.
The following table summarizes AbbVie RSA and RSU activity (including performance-based awards)
for both AbbVie and Abbott employees for the year ended December 31, 2013.
Weighted-average
(share units in thousands) Share units grant date fair value
Outstanding at December 31, 2012 — $ —
Awards converted on January 1, 2013 15,394 27.55
Granted 7,615 36.39
Vested (7,553) 27.33
Lapsed (546) 30.65
Outstanding at December 31, 2013 14,910 $32.07
Unvested shares at December 31, 2013 14,804 $32.08
The fair market value of RSAs and RSUs vested in 2013 was $285 million. For RSAs and RSUs issued
under Abbott’s incentive stock programs prior to the separation, the fair market value of RSAs and
RSUs vested in 2012 and 2011 was $123 million and $74 million, respectively. The weighted-average
grant-date fair value per share of RSAs and RSUs granted during 2012 and 2011 was $56.07 and
$46.85, respectively. Such amounts have not been adjusted to reflect the separation from Abbott.
As of December 31, 2013, $177 million of unrecognized compensation cost related to RSAs and RSUs
is expected to be recognized as expense over approximately the next two years.
Cash Dividends
On January 4, February 15, June 20, and September 19, 2013, the board of directors declared quarterly
cash dividends of $0.40 per share of common stock, which were paid on February 15, May 15,
August 15 and November 15, 2013, respectively. Additionally, on December 12, 2013, the board of
directors declared a quarterly cash dividend of $0.40 per share of common stock for stockholders of
record on January 15, 2014, which was paid on February 14, 2014.
The cash dividend of $0.40 per share of common stock declared on January 4, 2013 was declared from
pre-separation earnings and was recorded as a reduction of additional paid-in capital.
Stock Repurchase Program
On February 15, 2013, AbbVie’s board of directors authorized a $1.5 billion stock repurchase program.
Purchases of AbbVie shares may be made from time to time at management’s discretion depending on
the company’s cash flows, net debt level and market conditions. The plan has no time limit and can be
discontinued at any time. During 2013, AbbVie repurchased approximately 4 million shares for
$223 million in the open market. Shares repurchased under this program are recorded at acquisition
cost, including related expenses, and are available for general corporate purposes. AbbVie’s remaining
share repurchase authorization is $1.3 billion as of December 31, 2013.
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