AbbVie 2014 Annual Report Download - page 95

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13NOV201221352027
The following table summarizes AbbVie stock option activity for both AbbVie and Abbott employees for
the year ended December 31, 2014:
Weighted-
Weighted- Average
average remaining Aggregate
(options in thousands, aggregate intrinsic value in millions) Options exercise price life (in years) intrinsic value
Outstanding at December 31, 2013 35,994 $27.48 3.6 $ 912
Granted 1,134 51.53
Exercised (8,765) 27.18
Lapsed (83) 25.97
Outstanding at December 31, 2014 28,280 $28.53 3.3 $1,044
Exercisable at December 31, 2014 25,497 $27.20 2.8 $ 975
The aggregate intrinsic value in the table above represents the difference between the exercise price
and the company’s closing stock price on the last day of trading for the year ended December 31, 2014.
The total intrinsic value of options exercised in 2014 and 2013 was $253 million and $229 million,
respectively. For options issued under Abbott’s incentive stock programs to AbbVie employees prior to the
separation, the total intrinsic value of options exercises in 2012 was $170 million. The total fair value of
options vested during 2014 was $8 million.
The excess tax benefit realized from option exercises totaled $46 million for 2014. As of December 31,
2014, $4 million of unrecognized compensation cost related to stock options is expected to be recognized
as expense over approximately the next two years.
RSAs & RSUs
RSAs generally vest over three or five years. For RSAs that vest over five years, no more than one-third
of the award vests in any one year. RSUs vest over three years and, upon vesting, the recipient receives
one share of common stock for each vested RSU. In addition, AbbVie grants selected executives and other
key employees performance-based RSAs and RSUs with vesting contingent upon meeting various
company-wide performance goals, including AbbVie achieving a 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, 2014:
Weighted-average
(share units in thousands) Share units grant date fair value
Outstanding at December 31, 2013 14,910 $32.07
Granted 5,112 51.55
Vested (6,638) 29.43
Lapsed (569) 38.48
Outstanding at December 31, 2014 12,815 $40.98
The fair market value of RSAs and RSUs vested in 2014 and 2013 was $338 million and $285 million,
respectively. 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 was $123 million. The weighted-average grant-date fair
2014 Form 10-K 89