Computer Associates 2006 Annual Report Download - page 160

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Note 9 — Stock Plans (Continued)
The following table summarizes the activity of RSA’s under the Plans (no RSA’s were granted prior to fiscal year
2004):
Number
of Shares
Weighted Average
Grant Date
Fair Value
(shares in thousands)
Outstanding at March 31, 2003............................... — $ —
Restricted stock granted .................................. 627 26.86
Restricted stock released.................................. — —
Restricted stock cancelled ................................. — —
Outstanding at March 31, 2004............................... 627 $26.86
Restricted stock granted .................................. 577 25.30
Restricted stock released.................................. (105) 26.96
Restricted stock cancelled ................................. (382) 26.75
Outstanding at March 31, 2005............................... 717 $25.64
Restricted stock granted .................................. 354 27.41
Restricted stock released.................................. (302) 26.12
Restricted stock cancelled ................................. (63) 23.51
Outstanding at March 31, 2006............................... 706 $26.51
The total cash received from employees as a result of employee stock option exercises in fiscal years 2006, 2005,
and 2004 was approximately $97 million, $73 million, and $57 million, respectively. The Company settles
employee stock option exercises with stock held in treasury. The total intrinsic value of options exercised during the
fiscal years 2006, 2005 and 2004 was $41 million, $36 million and $45 million, respectively. The tax benefits
realized by the Company for stock options exercised during fiscal years 2006, 2005, and 2004 was approximately
$19 million, $14 million, and $7 million, respectively. The total intrinsic value of restricted awards released during
the fiscal years 2006 and 2005 was $9 million and $4 million, respectively. There were no restricted awards released
during fiscal year 2004.
Upon adoption of SFAS No. 123(R), the Company has elected to treat awards with only service conditions and with
graded vesting as one award. Consequently, the total compensation expense is recognized ratably over the entire
vesting period, so long as compensation cost recognized at any date at least equals the portion of the grant-date value
of the award that is vested at that date.
The Company completed its acquisition of Niku during the quarter ended September 30, 2005. Pursuant to the
merger agreement, options to purchase Niku common stock were converted (using a ratio of 0.732) into options to
purchase approximately 0.8 million shares of the Company’s stock. The weighted average fair value of the options
on the date of acquisition was $15.96. The fair value of each option grant was estimated on the date of grant using
the Black-Scholes option pricing model. The weighted average assumptions that were used for option grants were as
follows:
Dividend yield ............................................................ 0.58%
Expected volatility factor .................................................... 0.45
Risk-free interest rate....................................................... 4.0%
Expected life (in years) ..................................................... 3.8
Refer to Note 2, “Acquisitions, Divestitures, and Restructuring,” for additional information concerning the
acquisition of Niku.
The Company completed its acquisition of Concord during the quarter ended June 30, 2005. Pursuant to the merger
agreement, options to purchase Concord common stock were converted (using a ratio of 0.626) into options to
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