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STOCK-BASED COMPENSATION | 12 Months Ended
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Dec. 31, 2021
Share-based Payment Arrangement [Abstract] |
STOCK-BASED COMPENSATION | STOCK-BASED COMPENSATION Vimeo currently has one active plan, the 2021 Stock and Annual Incentive Plan (the "2021 Plan"), including an Israeli Appendix, which was adopted in connection with the Spin-off. The 2021 Plan replaced the Vimeo, LLC 2012 Incentive Plan, the Vimeo, Inc. 2017 Incentive Plan and the Vimeo, Inc. 2019 Incentive Plan (including an Israeli Appendix), collectively referred to as the “Prior Plans.” The Prior Plans were automatically terminated and replaced and superseded by the 2021 Plan upon the completion of the Spin-off. Any and all awards granted under the Prior Plans, remain in effect on their pre Spin-off terms pursuant to the 2021 Plan, subject to adjustment in connection with the Spin-off and the Vimeo Merger. The 2021 Plan also covers vested IAC stock options that were converted into Vimeo stock options in connection with the Spin-off. The 2021 Plan authorizes the Company to grant equity awards to its employees, officers, directors and consultants covering an aggregate of up to 10.0 million shares of the Company's common stock (in addition to previously-awarded shares). At December 31, 2021, there are 8.4 million shares available for grant under the 2021 Plan. Equity awards provided for in the 2021 Plan include SARs, stock options, RSUs, and other stock-based awards related to shares of Vimeo common stock. The exercise price of stock options and SARs cannot be less than the market value of Vimeo common stock on the grant date. In connection with the settlement of stock-based awards, shares of Vimeo common stock may be issued either from authorized but unissued shares or from treasury stock. SARs issued to date generally vest in four equal annual installments over a four‑year period. RSUs issued to date generally cliff vest in either one year or three years from the grant date. Vimeo recorded stock-based compensation expense of $44.9 million, $11.7 million, and $5.3 million for the years ended December 31, 2021, 2020, and 2019 respectively. Included in stock-based compensation expense in the year ended December 31, 2021 is a modification charge of $9.5 million in connection with the Spin-off and Vimeo Merger. The form of awards granted to the Company’s employees and non-employee directors in 2021 were generally restricted stock units (“RSUs”) and in the case of the Chairman of the Vimeo Board of Directors, 4,870,500 shares of Vimeo common stock (“Vimeo Restricted Shares”); and in prior years, generally stock appreciation rights ("SARs") and in the case of certain executives, performance-based SARs. At December 31, 2021, there was $78.1 million of unrecognized compensation cost, net of estimated forfeitures, related to all outstanding SARs and RSUs which is expected to be recognized over a weighted-average period of 2.3 years. Additionally, there was $81.7 million of unrecognized compensation cost related to the Vimeo Restricted Shares, which is expected to be recognized over the remaining vesting period of 8.8 years. For more information on the impact of the Spin-off and the Vimeo Merger on equity awards refer to "Note 1—Organizatio n and Basis of Presentatio n." Vimeo is currently in an NOL position with a full valuation allowance. Therefore, no income tax benefit was recognized in the accompanying consolidated statement of operations for the years ended December 31, 2021, 2020, and 2019 related to equity awards. Stock appreciation rights and stock options The weighted average grant date fair value for SARs granted during the years ended December 31, 2020 and 2019 is $2.16 and $2.14, respectively. Stock options outstanding as of December 31, 2021 relate solely to the conversion of vested IAC stock options into Vimeo stock options in connection with the Spin-off as more fully described in "Note 1—Organizatio n and Basis of Presentatio n. The summary of the weighted average assumptions used to value SARs at their grant date for the years ended December 21, 2020 and 2019 is as follows.
|  |  | Years Ended December 31,
|  |  | 2020 |  | 2019
Expected volatility |  |  | 38 | % |  | 41 | %
Risk-free interest rate |  |  | 1.0 | % |  | 1.8 | %
Expected term |  |  | 3.3 years |  | 3.4 years
Dividend yield |  |  | — | % |  | — | %
The total intrinsic value of awards exercised during the years ended December 31, 2021, 2020, and 2019 is $49.4 million, $23.9 million, and $0.6 million, respectively. Total cash received from the exercise of stock options for the year ended December 31, 2021 was $3.4 million. There was no cash received from exercises of SARs, as by their nature, are settled net of the exercise price with the award holder entitled to receive value equal to any appreciation in the award. SARs and stock options outstanding at December 31, 2021 and changes during the year ended December 31, 2021 are as follows:
|  | SARs and stock options |  | Weighted average exercise price |  | Weighted average remaining contractual term in years |  | Aggregate intrinsic value
|  | (Shares and intrinsic value in thousands)
Outstanding Vimeo OpCo SARs at December 31, 2020 |  | 13,897 |  | $ | 6.42 |  |  |  |  |
Granted |  | 63 |  | 35.35 |  |  |  |  |
Exercised |  | (305) |  | 5.52 |  |  |  |  |
Forfeited or Expired |  | (178) |  | 6.56 |  |  |  |  |
Outstanding Vimeo OpCo SARs prior to Spin-off |  | 13,477 |  |  | 6.57 |  |  |  |  |
Outstanding Vimeo SARs after Spin-off (a) |  | 13,686 |  | 6.49 |  |  |  |  |
Conversion of Vested IAC Stock Options (b) |  | 6,201 |  | 4.33 |  |  |  |  |
Exercised |  | (2,162) |  | 4.87 |  |  |  |  |
Forfeited or Expired |  | (238) |  | 7.01 |  |  |  |  |
Outstanding Vimeo SARs and Stock Options at December 31, 2021 |  | 17,487 |  |  | 5.91 |  |  | 6.1 |  | $ | 210,640 |
Exercisable Vimeo SARs and Stock Options at December 31, 2021 |  | 13,350 |  |  | $ | 5.38 |  |  | 5.5 |  | $ | 167,984 |
____________________ (a) Reflects the conversion of unvested Vimeo OpCo SARs into Vimeo SARs by multiplying each award of Unvested Vimeo OpCo SARs prior to Spin-off by the Vimeo Merger Exchange Ratio. (b) Reflects the conversion of vested IAC stock options into vested Vimeo stock options by multiplying each vested award of IAC stock options prior to the Spin-off by the Spin-off Exchange Ratio. As of December 31, 2021, the number, weighted-average exercise price, weighted-average remaining contractual term, and aggregate intrinsic value of Vimeo SARs and stock options that either had vested or are expected to vest approximate the corresponding amounts for Vimeo SARs and stock options outstanding. Restricted stock units The weighted-average fair value of Vimeo RSUs granted in 2021 was $26.11. The weighted average fair value of Vimeo OpCo RSUs granted (prior to the Spin-off) in the years ended December 31, 2021 and 2020 was $35.35 and $17.33, respectively. There were no Vimeo OpCo RSUs granted in the year ended December 31, 2019. The intrinsic value of RSUs that vested during the year ended December 31, 2021 was less than $0.1 million. There were no RSUs that vested during the years ended December 31, 2020 and 2019. Unvested RSUs outstanding at December 31, 2021 and changes during the year ended December 31, 2021 are as follows:
|  | Number of Shares |  | Weighted Average Grant Date Fair Value
|  | (Shares in thousands)
Unvested Vimeo OpCo RSUs at December 31, 2020 |  | 88 |  |  | $ | 17.33 |
Granted |  | 1,734 |  |  | 35.35 |
Forfeited |  | (5) |  |  | 35.35 |
Unvested Vimeo OpCo RSUs prior to Spin-off |  | 1,817 |  |  | 34.48 |
Unvested Vimeo RSUs after Spin-off (a) |  | 1,844 |  |  | 34.70 |
Granted |  | 1,619 |  |  | 26.11 |
Released |  | (2) |  |  | $ | 33.33 |
Forfeited |  | (117) |  |  | $ | 36.23 |
Unvested Vimeo RSUs at December 31, 2021 |  | 3,344 |  |  | $ | 30.49 |
_____________________ (a) Reflects the conversion of unvested Vimeo OpCo RSUs into Vimeo RSUs by multiplying each award of Unvested Vimeo OpCo RSUs prior to Spin-off by the Vimeo Merger Exchange Ratio. Vimeo Restricted Shares In connection with the Spin-off, pursuant to which Vimeo equity awards were issued as part of the adjustment of certain outstanding IAC equity awards, Vimeo entered into a Restricted Stock Agreement (the “RSA”) with Joseph Levin, Chairman of the Vimeo Board of Directors and IAC’s Chief Executive Officer. The terms of the RSA were determined pursuant to the existing requirements of Mr. Levin’s restricted stock agreement with IAC as in effect prior to the Spin-off. Vimeo Restricted Shares granted pursuant to the RSA will cliff vest on November 5, 2030 based on satisfaction of certain Vimeo stock price targets and Mr. Levin’s continuous service as a Vimeo director through the vesting date. The number of Vimeo Restricted Shares subject to the RSA is the result of the 3,000,000 shares of IAC Restricted common stock, subject to Mr. Levin’s restricted stock agreement with IAC, multiplied by the Spin-off Exchange Ratio. Mr. Levin may elect to accelerate vesting of the Vimeo Restricted Shares, effective on the 6th, 7th, 8th, or 9th anniversary of the original effective date of the IAC restricted stock agreement (November 5, 2020) (the “Effective Date”), in which case performance will be measured through such date, and Mr. Levin will receive a pro-rated portion of the award (based on the years elapsed from the Effective Date) and any remaining shares will be forfeited. The applicable stock price goals are proportionately lower on the earlier vesting dates. The value of the Vimeo Restricted Shares was determined using a lattice model that incorporated a Monte Carlo simulation of Vimeo's stock price and IAC’s stock price as this award contains a market condition. The attribution of the estimated fair values of the awards (the sum of the fair value of the original IAC award as of the Effective Date, plus any incremental value as a result of the modification to the original IAC award) between IAC and Vimeo, was determined on a proportional basis as a function of the estimated fair value of each respective award as of the date of the Spin-off. The amount allocated to Vimeo was $87.3 million and is expected to be recognized over the remaining requisite service period through November 2030 subject to Mr. Levin’s continuous service as a Vimeo director. Modification In connection with the Spin-off and Vimeo Merger, the Company modified certain equity awards resulting in a modification charge of $14.0 million, of which $9.5 million was recognized as stock-based compensation expense in the year ended December 31, 2021. The remaining charge, net of forfeitures, is expected to be recognized over the remaining requisite service period of the modified awards.

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