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McKESSON CORPORATION
FINANCIAL NOTES (Continued)
95
VII. Other Matters
We are involved in various other litigation and governmental proceedings, not described above, that arise in the
normal course of business. While it is not possible to determine with certainty the ultimate outcome or the duration
of any such litigation or governmental proceedings, we believe based on current knowledge and the advice of our
counsel that such litigation and proceedings will not have a material impact on our financial position or results of
operations.
18. Stockholders’ Equity
Each share of the Company’ s outstanding common stock is permitted one vote on proposals presented to
stockholders and is entitled to share equally in any dividends declared by the Company’ s Board of Directors (the
“Board”).
Share repurchase plans: The Board approved share repurchase plans in October 2003, August 2005, December
2005 and January 2006 which permitted the Company to repurchase up to a total of $1.0 billion ($250 million per
plan) of the Company’ s common stock. Under these plans, we repurchased 19 million shares for $958 million
during 2006. During 2007, we repurchased the remaining available shares under the January 2006 plan, fully
utilizing all of these repurchase plans.
In April and July 2006, the Board approved two new share repurchase plans which permitted the Company to
repurchase up to an additional $1.0 billion ($500 million per plan) of the Company’ s common stock. During 2007,
we repurchased a total of 20 million shares for $1.0 billion. As a result of these repurchases, we effectively
completed all of the 2007 share repurchase plans.
In April and September 2007, the Board approved two new plans to repurchase up to $2.0 billion of the
Company’ s common stock ($1.0 billion per plan). In 2008, we repurchased a total of 28 million shares for $1,686
million, fully utilizing the April 2007 plan, leaving $314 million remaining on the September 2007 plan. In April
2008, the Board approved a new plan to repurchase an additional $1.0 billion of the Company’ s common stock.
Stock repurchases may be made from time-to-time in open market or private transactions.
2005 Stock Plan (the “2005 Stock Plan”): The 2005 Stock Plan was adopted by the Board on May 25, 2005 and
approved by the Company’ s stockholders on July 25, 2005. The 2005 Stock Plan initially provided for the grant of
up to 13 million shares in the form of nonqualified stock options, incentive stock options, restricted stock awards,
restricted stock unit awards, stock appreciation rights, performance shares and other share-based awards to
employees, officers and directors of the Company. The 2005 Stock Plan replaced several other plans (the “Legacy
Plans”) and the remaining 11 million shares available for issuance under the Legacy Plans were cancelled, although
awards under those plans remain outstanding.
In July 2007, the Company’ s stockholders amended the 2005 Stock Plan to increase the number of shares of
common stock reserved for issuance under the 2005 Stock Plan by 15 million shares to an aggregate of 28 million
shares. As of March 31, 2008, 16 million shares remain available for grant under the 2005 Stock Plan. As a result
of acquisitions, we currently have 5 other option plans under which no further awards have been made since the date
of acquisition.
2000 Employee Stock Purchase Plan (the “ESPP”): The Company also has an ESPP under which 11 million
shares have been authorized for issuance. On July 25, 2007, the Company’ s stockholders approved an amendment
to the ESPP under which the number of shares of common stock reserved for issuance was increased by 5 million
shares to an aggregate of 16 million shares. Eligible employees may purchase a limited number of shares of the
Company’ s common stock at a discount of up to 15% of the market value at certain plan-defined dates. In each year
of 2008, 2007 and 2006, 1 million shares were issued under the ESPP. At March 31, 2008, 6 million shares were
available for issuance under the ESPP.
As previously discussed, during the first quarter of 2006, we called for the redemption of the Debentures, which
resulted in the exchange of the preferred securities for 5 million shares of our newly issued common stock.