Cardinal Health 2011 Annual Report Download - page 98

1
7.
S
HARE-BA
S
ED
CO
MPEN
S
ATI
O
N AND
S
AVIN
GS
PLAN
S
Sh
are-Base
d
Com
p
ensation P
l
an
s
We maintain stock incentive plans (collectively, the “Plans”) for the benefit of certain of our officers
,
di
rectors an
d
emp
l
oyees. Emp
l
oyee stoc
k
opt
i
ons grante
d
un
d
er t
h
eP
l
ans
f
rom
fi
sca
l
2008 t
h
roug
hfi
sca
l
201
1
g
enerall
y
vest in equal annual installments over three
y
ears and are exercisable for periods up to seven
y
ear
s
f
rom the date of grant at a price equal to the market price of the Common Shares underlying the option at the dat
e
of
grant. Emp
l
oyee stoc
k
opt
i
ons grante
d
un
d
er t
h
eP
l
ans
d
ur
i
ng
fi
sca
l
2007 genera
ll
y vest
i
n equa
l
annua
l
installments over four
y
ears and are exercisable for periods up to seven
y
ears from the date of
g
rant at a pric
e
equal to the market price of the Common Shares underlying the option at the date of grant. Employee restricte
d
s
h
ares an
d
restr
i
cte
d
s
h
are un
i
ts grante
d
un
d
er t
h
eP
l
ans s
i
nce
fi
sca
l
2007 genera
ll
y vest
i
n equa
li
nsta
ll
ment
s
o
ver three
y
ears and entitle holders to dividends or cash dividend equivalents. Restricted shares and restricte
d
share units accrue dividends or cash dividend equivalents that are payable upon vesting of the awards.
T
he compensation expense reco
g
nized for all share-based compensation awards is net of estimate
d
f
orfeitures and is recognized using the straight-line method over the applicable service period. We classify share
-
b
ase
d
compensat
i
on w
i
t
hi
n SG&A expenses to correspon
d
w
i
t
h
t
h
e same
li
ne
i
tem as t
h
ema
j
or
i
ty o
f
t
h
e cas
h
compensation paid to emplo
y
ees. However, as described in Note 3, certain share-based compensation incurred i
n
connection with the Spin-Off is classified within restructuring and employee severance
.
T
he followin
g
table provides total share-based compensation expense from continuin
g
operations b
y
t
y
pe o
f
a
ward for fiscal 2011, 2010 and 2009:
F
iscal Year Ended June 30
,
(
in millions
)
2
0
1
1
2
010
(
1
)(
2
)
2009
(
3
)(
4
)
R
estr
i
cte
d
s
h
are an
d
s
h
are un
i
t expens
e
......................
$
52.2
$
56.8
$
62.
8
Emplo
y
ee stock option expense
............................
25
.
9
41.0 36.6
Employee stock purchase plan expens
e
.
..................... 0.0 1.
1
12.6
S
toc
k
apprec
i
at
i
on r
i
g
h
t(
i
ncome)/expens
e
.
................... 1.4
0
.
6
(2
.
1)
T
ota
l
s
h
are-
b
ase
d
compensat
i
on expense
f
rom cont
i
nu
i
ng
operat
i
on
s
...........................................
$
79.5
$
99.5
$
109.9
(1) Exc
l
u
d
es s
h
are-
b
ase
d
compensat
i
on expense c
h
arge
d
to
di
scont
i
nue
d
operat
i
ons, w
hi
c
h
was approx
i
mate
ly
$
2.3 million, net of tax benefits of $1.5 million, durin
g
fiscal 2010
.
(2) Share-based compensation expense charged to restructuring and employee severance related to the Spin-Of
f
was approximately
$
9.9 million, net of tax benefits of
$
5.7 million, during fiscal 2010
.
(3) Excludes share-based compensation expense char
g
ed to discontinued operations, which was approximatel
y
$
14.1 million, net of tax benefits of
$
6.3 million, during fiscal 2009.
(4) S
h
are-
b
ase
d
compensat
i
on expense c
h
arge
d
to restructur
i
ng an
d
emp
l
oyee severance re
l
ate
d
to t
h
eSp
i
n-O
ff
was approximatel
y
$4.9 million, net of tax benefits of $2.6 million, durin
g
fiscal 2009
.
Th
e
f
o
ll
ow
i
ng ta
bl
e summar
i
zes t
h
e tota
l
tax
b
ene
fi
t
f
rom cont
i
nu
i
ng operat
i
ons re
l
ate
d
to s
h
are-
b
ase
d
com
p
ensation for fiscal 2011, 2010 and 2009:
F
iscal Year Ended June 30
,
(
in millions
)
2
0
1
1
20
1
0
2
009
T
ax benefit from continuing operations related to share-based
c
ompensat
i
on
...............................................
$
28.9
$
36.1
$
37.
3
72