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CVS CAREMARK 61 2011 ANNUAL REPORT
5 SHARE REPURCHASE PROGRAMS
On August 23, 2011, the Company’s Board of Directors
authorized a share repurchase program for up to $4.0 bil-
lion of outstanding common stock (the “2011 Repurchase
Program”). The share repurchase authorization under the
2011 Repurchase Program, which was effective immediately,
permits the Company to effect repurchases from time to
time through a combination of open market repurchases, pri-
vately negotiated transactions, accelerated share repurchase
transactions, and/or other derivative transactions. The 2011
Repurchase Program may be modified or terminated by the
Board of Directors at any time.
Pursuant to the authorization under the 2011 Repurchase
Program, on August 24, 2011, the Company entered into a
$1.0 billion fixed dollar accelerated share repurchase (“ASR”)
agreement with Barclays Bank PLC (“Barclays”). The ASR
agreement contained provisions that establish the minimum
and maximum number of shares to be repurchased dur-
ing its term. Pursuant to the ASR agreement, on August 25,
2011, the Company paid $1.0 billion to Barclays in exchange
for Barclays delivering 20.3 million shares of common stock
to the Company. On September 16, 2011, upon establish-
ment of the minimum number of shares to be repurchased,
Barclays delivered an additional 5.4 million shares of com-
mon stock to the Company. The Company received an addi-
tional 1.6 million shares of common stock on December
29, 2011, due to the fluctuation in market price of common
stock over the term of the ASR agreement, which concluded
on December 28, 2011. The total of 27.3 million shares of
common stock delivered to the Company by Barclays over
the term of the ASR agreement were placed into treasury
stock. The Company accounted for the ASR agreement as
two separate transactions: (i) as shares of common stock
acquired in a treasury stock transaction and (ii) as a forward
contract indexed to the Company’s own common stock. As
such, the Company accounted for the shares that it received
under the ASR agreement as a repurchase of its common
stock for the purpose of calculating earnings per share. The
Company has determined that the forward contract indexed
to the Company’s common stock met all of the applicable
criteria for equity classification.
On June 14, 2010, the Company’s Board of Directors autho-
rized a share repurchase program for up to $2.0 billion of out-
standing common stock (the “2010 Repurchase Program”).
The share repurchase authorization under the 2010
Repurchase Program, which was effective immediately and
expired at the end of 2011, permitted the Company to effect
repurchases from time to time through a combination of open
market repurchases, privately negotiated transactions, accel-
erated share repurchase transactions, and/or other derivative
transactions. During the year ended December 31, 2011, the
Company repurchased an aggregate of 56.4 million shares of
common stock for approximately $2.0 billion, completing the
2010 Repurchase Program. The Company did not make any
share repurchases under the 2010 Repurchase Program dur-
ing the year ended December 31, 2010.
On November 4, 2009, the Company’s Board of Directors
authorized a share repurchase program for up to $2.0 bil-
lion of its outstanding common stock (the “2009 Repurchase
Program”). From November 4, 2009 through December 31,
2009, the Company repurchased 16.1 million shares of com-
mon stock for approximately $500 million under the 2009
Repurchase Program. During the year ended December 31,
2010, the Company repurchased 42.4 million shares of com-
mon stock for approximately $1.5 billion, completing the
2009 Repurchase Program.
On May 7, 2008, the Company’s Board of Directors autho-
rized, effective May 21, 2008, a share repurchase program
for up to $2.0 billion of its outstanding common stock (the
“2008 Repurchase Program”). From May 21, 2008 through
December 31, 2008, the Company repurchased approxi-
mately 0.6 million shares of common stock for $23 million
under the 2008 Repurchase Program. During the year ended
December 31, 2009, the Company repurchased approxi-
mately 57.0 million shares of common stock for approximately
$2.0 billion, completing the 2008 Repurchase Program.
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