Expedia 2008 Annual Report Download - page 97

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NOTE 9 — Stock-Based Awards and Other Equity Instruments
Pursuant to the 2005 Expedia, Inc. Stock and Annual Incentive Plan, we may grant restricted stock,
restricted stock awards, RSUs, stock options and other stock-based awards to directors, officers, employees
and consultants. As of December 31, 2008, we had approximately 8 million shares of common stock reserved
for new stock-based awards under the 2005 Stock and Annual Incentive Plan. We issue new shares to satisfy
the exercise or release of stock-based awards.
RSUs, which are stock awards that are granted to employees entitling the holder to shares of our common
stock as the award vests, have been our primary form of stock-based award. We record RSUs that will settle
in cash as a liability and we remeasure them to fair value at the end of each reporting period. These awards
that settle in cash and the resulting liability are insignificant. Our RSUs generally vest over five years, but
may accelerate in certain circumstances, including certain changes in control.
The following table presents a summary of RSU activity:
RSU’s
Weighted
Average Grant-
Date Fair
Value
(In thousands)
Balance as of January 1, 2006 .............................. 5,765 $24.08
Granted .............................................. 5,016 18.59
Vested and released...................................... (1,337) 23.94
Cancelled ............................................. (1,923) 23.09
Balance as of December 31, 2006 . .......................... 7,521 20.72
Granted .............................................. 3,768 22.92
Vested and released...................................... (1,538) 21.72
Cancelled ............................................. (1,489) 21.20
Balance as of December 31, 2007 . .......................... 8,262 21.43
Granted .............................................. 4,123 21.78
Vested and released...................................... (1,846) 21.76
Cancelled ............................................. (1,493) 22.20
Balance as of December 31, 2008 . .......................... 9,046 21.41
The total fair value of shares vested and released during the years ended December 31, 2008, 2007 and
2006 was $40 million, $33 million and $32 million. Included in RSUs outstanding at December 31, 2008 are
approximately 1 million RSUs awarded to certain senior executives, for which vesting is tied to achievement
of performance targets.
We have fully vested stock warrants with expiration dates through May 2012 outstanding, certain of
which were traded on the NASDAQ under the symbols “EXPEW” and “EXPEZ” until their expiration on
February 4, 2009. Each stock warrant is exercisable for a certain number of shares of our common stock or a
fraction thereof.
F-25
Expedia, Inc.
Notes to Consolidated Financial Statements — (Continued)