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Share-Based Compensation
 6 Months Ended 12 Months Ended
Jun. 30, 2019
Dec. 31, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]    
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] Share-Based Compensation

We grant time-vesting restricted stock units and restricted stock (collectively, "RSUs"), nonqualified stock options ("options") and performance-vesting RSUs ("performance shares") to our employees and deferred share units ("DSUs") to members of our board of directors. We recognized share-based compensation expense of $47 million and $40 million during the three months ended June 30, 2019 and 2018, respectively, and $81 million and $68 million during the six months ended June 30, 2019 and 2018, respectively. As of June 30, 2019, unrecognized compensation costs for unvested awards was approximately $190 million, which are expected to be recognized over a weighted-average period of 1.9 years on a straight-line basis. As of June 30, 2019, there were 14.2 million shares of common stock available for future issuance under the Hilton 2017 Omnibus Incentive Plan, plus any shares subject to awards outstanding under our 2013 Omnibus Incentive Plan, which will become available for issuance under the Hilton 2017 Omnibus Incentive Plan if such outstanding awards expire or are terminated or are canceled or forfeited.

RSUs

During the six months ended June 30, 2019, we granted 1.0 million RSUs with a weighted average grant date fair value per share of $83.38, which generally vest in equal annual installments over two or three years from the date of grant.

Options

During the six months ended June 30, 2019, we granted 0.8 million options with a weighted average exercise price per share of $83.11, which vest over three years from the date of grant in equal annual installments and terminate 10 years from the date of grant or earlier if the individual's service terminates under certain circumstances.

The weighted average grant date fair value per share of the options granted during the six months ended June 30, 2019 was $21.08, which was determined using the Black-Scholes-Merton option-pricing model with the following assumptions:
Expected volatility(1)
23.51
%
Dividend yield(2)
0.81
%
Risk-free rate(3)
2.47
%
Expected term (in years)(4)
6.0

____________
(1) 
Estimated using historical movement of Hilton's stock price.
(2) 
Estimated based on the quarterly dividend and the three-month average stock price at the date of grant.
(3) 
Based on the yields of U.S. Department of Treasury instruments with similar expected lives.
(4) 
Estimated using the average of the vesting periods and the contractual term of the options.

As of June 30, 2019, 1.6 million options were exercisable.

Performance Shares

During the six months ended June 30, 2019, we granted 0.4 million performance shares with a weighted average grant date fair value per share of $83.11. The performance shares are settled at the end of the three-year performance period with: (i) 50 percent of the awards subject to achievement based on the compound annual growth rate ("CAGR") of the Company's earnings before interest expense, a provision for income taxes and depreciation and amortization ("EBITDA"), adjusted to exclude certain items ("Adjusted EBITDA"), referred to as EBITDA CAGR and (ii) 50 percent of the awards subject to achievement based on the Company's free cash flow ("FCF") per share CAGR, referred to as FCF CAGR. The total number of performance shares that vest related to each performance measure is based on an achievement factor that ranges from a zero percent to 200 percent payout, with 100 percent being the target. As of June 30, 2019, we determined that the performance conditions for the performance shares are probable of achievement and we recognized compensation expense, for both our outstanding EBITDA CAGR and FCF CAGR performance shares, at the maximum achievement percentage for the 2017 grants, between target and maximum for the 2018 grants and at target for the 2019 grants.
 Share-Based Compensation

We recognized share-based compensation expense of $127 million, $121 million and $81 million during the years ended December 31, 2018, 2017 and 2016, respectively, which included amounts reimbursed by hotel owners. The total tax benefit recognized related to share-based compensation expense was $42 million, $49 million and $31 million for the years ended December 31, 2018, 2017 and 2016, respectively. As of December 31, 2018 and 2017, we accrued $15 million in accounts payable, accrued expenses and other in our consolidated balance sheets for certain awards settled in cash.

As of December 31, 2018, unrecognized compensation costs for unvested awards was approximately $121 million, which is expected to be recognized over a weighted-average period of 1.7 years on a straight-line basis. As of December 31, 2018, there were 16.1 million shares of common stock available for future issuance under the Hilton 2017 Omnibus Incentive Plan, plus any shares subject to awards outstanding under our 2013 Omnibus Incentive Plan, which will become available for issuance under our 2017 Omnibus Incentive Plan as a result of such outstanding awards expiring or terminating or being canceled or forfeited.

RSUs

The following table provides information about our RSU grants for the last three fiscal years:
 
Year Ended December 31,
 
2018
 
2017
 
2016
 
(in millions, except per share data)

Number of shares granted
0.9

 
1.5

 
1.2

Weighted average grant date fair value per share
$
79.31

 
$
58.80

 
$
59.73

Aggregate intrinsic value of shares vested
$
123

 
$
78

 
$
40



The following table summarizes the activity of our RSUs during the year ended December 31, 2018:
 
Number of Shares
 
Weighted Average Grant Date Fair Value per Share
 
(in millions)
 
 
Outstanding as of December 31, 2017
2.8

 
$
51.44

Granted
0.9

 
79.31

Vested
(1.5
)
 
49.56

Forfeited
(0.2
)
 
56.09

Outstanding as of December 31, 2018
2.0

 
64.88



Options

The following table provides information about our option grants for the last three fiscal years:
 
Year Ended December 31,
 
2018
 
2017
 
2016
 
(in millions, except per share data)

Number of options granted
0.6

 
0.7

 
0.5

Weighted average exercise price per share
$
79.36

 
$
58.40

 
$
58.83

Weighted average grant date fair value per share
$
23.72

 
$
13.96

 
$
16.41



The weighted average grant date fair value per share of each of these option grants was determined using the Black-Scholes-Merton option-pricing model with the following assumptions:
 
Year Ended December 31,
 
2018
 
2017
 
2016
Expected volatility(1)
27.91
%
 
24.00
%
 
32.00
%
Dividend yield(2)
0.74
%
 
0.92% - 1.03%

 
1.43
%
Risk-free rate(3)
2.73
%
 
1.93% - 2.03%

 
1.36
%
Expected term (in years)(4)
6.0

 
6.0

 
6.0

____________
(1) 
Estimated using historical movement of Hilton's stock price.
(2) 
For the year ended December 31, 2018, estimated based on the quarterly dividend and the three-month average stock price at the grant date; for the years ended December 31, 2017 and 2016, estimated based on the expected annualized dividend payment at the grant date.
(3) 
Based on the yields of U.S. Department of Treasury instruments with similar expected lives.
(4) 
Estimated using the average of the vesting periods and the contractual term of the options.

The following table summarizes the activity of our options during the year ended December 31, 2018:
 
Number of Shares
 
Weighted Average Exercise Price per Share
 
(in millions)
 
 
Outstanding as of December 31, 2017
2.0

 
$
51.24

Granted
0.6

 
79.36

Exercised
(0.2
)
 
50.15

Outstanding as of December 31, 2018(1)
2.4

 
58.50

Exercisable as of December 31, 2018(2)
1.1

 
50.07

____________
(1) 
The aggregate intrinsic value was $36 million and the weighted average remaining contractual term was 8 years.
(2) 
The aggregate intrinsic value was $25 million and the weighted average remaining contractual term was 7 years.

Performance Shares

During the years ended December 31, 2018 and 2017, we issued performance shares with 50 percent of the shares subject to achievement based on the Company's EBITDA CAGR and the other 50 percent of the shares subject to achievement based on the Company's FCF CAGR. The performance shares are settled at the end of the three-year performance period.

In 2016, we modified the performance shares that were outstanding as of December 31, 2016, which were based on a measure of the Company’s total shareholder return relative to the total shareholder returns of members of a peer company group and the Company’s EBITDA CAGR, such that, upon completion of the spin-offs, they were converted to RSUs. We recognized $2.3 million, $3.3 million, and $0.3 million of incremental expense related to the modification of these awards during the years ended December 31, 2018, 2017 and 2016, respectively.

We determined that the performance conditions for performance shares issued in 2018 and 2017 are probable of achievement and, as of December 31, 2018, we recognized compensation expense related to these awards based on the following anticipated achievement percentages:
 
EBITDA CAGR
 
FCF CAGR
2017 performance shares
200
%
 
200
%
2018 performance shares
150
%
 
150
%


The following table provides information about our performance share grants for the last three fiscal years:
 
Year Ended December 31,
 
2018
 
2017
 
2016
 
(in millions, except per share data)

EBITDA CAGR:
 
 
 
 
 
Number of shares granted
0.2

 
0.2

 
0.3

Weighted average grant date fair value per share
$
79.36

 
$
58.40

 
$
58.83

Aggregate intrinsic value of shares vested
$
—

 
$
—

 
$
12

 
 
 
 
 
 
FCF CAGR:
 
 
 
 
 
Number of shares granted
0.2

 
0.2

 
N/A

Weighted average grant date fair value per share
$
79.36

 
$
58.40

 
N/A

Aggregate intrinsic value of shares vested
$
—

 
$
—

 
N/A

 
 
 
 
 
 
Relative Shareholder Return:
 
 
 
 
 
Number of shares granted
N/A

 
N/A

 
0.3

Weighted average grant date fair value per share
N/A

 
N/A

 
$
62.43

Aggregate intrinsic value of shares vested
N/A

 
N/A

 
$
16



The following table summarizes the activity of our performance shares during the year ended December 31, 2018:
 
EBITDA CAGR
 
FCF CAGR
 
Number of Shares
 
Weighted Average Grant Date Fair Value per Share
 
Number of Shares
 
Weighted Average Grant Date Fair Value per Share
 
(in millions)
 
 
 
(in millions)
 
 
Outstanding as of December 31, 2017
0.2

 
$
58.41

 
0.2

 
$
58.41

Granted
0.2

 
79.36

 
0.2

 
79.36

Outstanding as of December 31, 2018
0.4

 
69.53

 
0.4

 
69.53