Computer Associates 2015 Annual Report Download - page 89

Note 14 — Stock Plans
Share-based incentive awards are provided to employees under the terms of the Company’s equity incentive compensation
plans (the Plans). The Plans are administered by the Compensation Committee. Awards under the Plans may include stock
options, restricted stock awards (RSAs), restricted stock units (RSUs), performance share units (PSUs), stock appreciation
rights or any combination thereof. The non-employee members of the Company’s Board of Directors receive deferred stock
units under a separate director compensation plan. The Company typically settles awards under employee and
non-employee director compensation plans with stock held in treasury.
All Plans, with the exception of acquired companies’ stock plans, have been approved by the Company’s shareholders. The
Company grants all new annual performance cash incentive bonuses, long-term performance bonuses, non-statutory stock
options, RSAs, RSUs and other equity-based awards under the 2011 Incentive Plan, which replaced the 2007 Incentive Plan.
Outstanding awards under the 2007 Incentive Plan and 2002 Incentive Plan, as amended, are satisfied under their respective
Plans. Approximately 45 million shares of common stock were originally available to be granted to select employees and
consultants under the 2011 Incentive Plan. Under the 2011 Incentive Plan, no more than 10 million incentive stock options
may be granted. The 2011 Incentive Plan will continue until the earlier of (i) termination by the Board or (ii) the tenth
anniversary of the date of the Company’s 2011 Annual Meeting of Stockholders. Awards to the non-employee directors are
granted under the 2012 Compensation Plan for Non-Employee Directors, which replaced the 2003 Compensation Plan for
Non-Employee Directors, as amended.
Share-Based Compensation: The Company recognized share-based compensation in the following line items in the
Consolidated Statements of Operations for the periods indicated:
YEAR ENDED MARCH 31,
(in millions) 2015 2014 2013
Costs of licensing and maintenance $ 5 $ 4 $ 3
Cost of professional services 444
Selling and marketing 30 28 30
General and administrative 29 26 23
Product development and enhancements 19 19 17
Share-based compensation expense before tax $87$81$77
Income tax benefit (28) (26) (25)
Net share-based compensation expense $59$55$52
The tax benefit from share-based incentive awards provided to employees that was recorded for book purposes exceeded
that which was deductible for tax purposes by $1 million, $5 million and $2 million for fiscal years 2015, 2014 and 2013,
respectively. The tax effect of this temporary difference in tax expense was recorded to ‘‘Additional paid-in capital’’ in the
Consolidated Balance Sheets and did not affect the Company’s Consolidated Statements of Operations.
The following table summarizes information about unrecognized share-based compensation costs at March 31, 2015:
UNRECOGNIZED WEIGHTED
SHARE-BASED AVERAGE PERIOD
COMPENSATION EXPECTED TO BE
COSTS RECOGNIZED
(in millions) (in years)
Stock option awards $ 6 1.8
Restricted stock units 16 1.9
Restricted stock awards 55 1.9
Performance share units 23 2.3
Total unrecognized share-based compensation costs $ 100 2.0
There were no capitalized share-based compensation costs at March 31, 2015, 2014 or 2013.
Stock Option Awards: Stock options are awards issued to employees that entitle the holder to purchase shares of the
Company’s stock at a fixed price. Stock option awards are generally granted at an exercise price equal to the Company’s fair
market value on the date of grant and with a contractual term of 10 years, unless the Compensation Committee establishes
a shorter expiration period or the stock options are forfeited. Stock option awards generally vest one-third per year and
become fully vested three years from the grant date.
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