Yahoo 2014 Annual Report Download - page 139

contributions at a rate of 25 percent, up to the IRS prescribed amount. Both employee and employer
contributions vest immediately upon contribution. During 2012, 2013, and 2014, the Company’s
contributions to the 401(k) Plan amounted to approximately $19 million, $18 million, and $19 million,
respectively. The Company also contributed approximately $22 million, $17 million, and $16 million to
its other defined contribution retirement benefit plans outside of the U.S. for 2012, 2013, and 2014,
respectively.
Stock Plans.The Stock Plan provides for the issuance of stock-based awards to employees,
including executive officers, and consultants. The Stock Plan permits the granting of incentive stock
options, non-statutory stock options, restricted stock, restricted stock units, stock appreciation
rights, and dividend equivalents.
Options granted under the Stock Plan before May 19, 2005 generally expire 10 years after the grant
date, and options granted after May 19, 2005 generally expire seven years after the grant date.
Options generally become exercisable over a four-year period based on continued employment and
vest either monthly, quarterly, semi-annually, or annually.
The Stock Plan permits the granting of restricted stock and restricted stock units (collectively
referred to as “restricted stock awards”). The restricted stock award vesting criteria are generally the
passing of time, meeting certain performance-based objectives, or a combination of both, and
continued employment through the vesting period (which varies but generally does not exceed four
years). Restricted stock award grants are generally measured at fair value on the date of grant based
on the number of shares granted and the quoted price of the Company’s common stock. Such value
is recognized as an expense over the corresponding service period.
The Stock Plan provides for the issuance of a maximum of 784 million shares of which 87 million
shares were still available for award grant purposes as of December 31, 2014. Each share of the
Company’s common stock issued in settlement of “full-value awards” (which include all awards other
than options and stock appreciation rights) granted on or after June 25, 2009 under the Stock Plan
counted as 1.75 shares against the Stock Plan’s share limit. Each share of the Company’s common
stock issued in settlement of “full-value awards” granted on or after June 25, 2014 under the Stock
Plan is counted as 2.5 shares against the Stock Plan’s share limit.
The Directors’ Plan provides for the grant of nonqualified stock options and restricted stock units to
non-employee directors of the Company. The Directors’ Plan provides for the issuance of up to
9 million shares of the Company’s common stock, of which approximately 5 million were still available
for award grant purposes as of December 31, 2014. Each share of the Company’s common stock
issued in settlement of restricted stock units granted after the Company’s 2006 annual meeting of
shareholders under the Directors’ Plan is counted as 1.75 shares against the Directors’ Plan’s share
limit.
Options granted under the Directors’ Plan before May 25, 2006 generally become exercisable, based
on continued service as a director, for initial grants to new directors, in equal monthly installments
over four years, and for annual grants, with 25 percent of such options vesting on the one year
anniversary of the date of grant and the remaining options vesting in equal monthly installments over
the remaining 36-month period thereafter. Such options generally expire seven to 10 years after the
grant date. Options granted on or after May 25, 2006 become exercisable, based on continued
service as a director, in equal quarterly installments over one year. Such options generally expire
seven years after the grant date.
Restricted stock units granted under the Directors’ Plan generally vest in equal quarterly installments
over a one-year period following the date of grant and, once vested, are generally payable in an
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