McKesson 2005 Annual Report Download - page 86

McKESSON CORPORATION
FINANCIAL NOTES (Continued)
could be material. Additionally, if there is further modification to the tentative amended contract terms and conditions and implementation
plan, it is possible that the terms of that agreement may result in significant losses, that could be material.
20. 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 (“Board”.)
In 2001, the Board approved a plan to repurchase up to $250.0 million of common stock of the Company in open market or private
transactions. In 2004 and 2003, we repurchased 3.9 million and 0.9 million shares for $115.1 million and $25.0 million. Since the inception of
this plan, we repurchased 8.3 million shares for $249.9 million. In 2004, the Board approved a new plan to repurchase up to $250.0 million of
additional common stock of the Company. Under this plan, we have repurchased 1.4 million shares for $41.5 million in 2004. No common
stock was repurchased under either of the plans in 2005. The repurchased shares will be used to support the Company’s stock-based employee
compensation plans and for other general corporate purposes.
In 2005, the Board renewed the common stock rights plan. Under the renewal of the plan, effective October 22, 2004, the Board declared a
dividend distribution of one right (a “Right”) for each outstanding share of Company common stock. Each Right entitles the holder to
purchase, upon the occurrence of certain triggering events, a unit consisting of one one-hundredth of a share of Series A Junior Participating
Preferred Stock. Triggering events include, without limitation, the acquisition by another entity of 15% or more of the Company’s common
stock without the prior approval of the Board. The Rights have certain anti-takeover effects that will cause substantial dilution to the ownership
interest of a person or group that attempts to acquire the Company on terms not approved by the Board. The new Rights will expire in 2014,
unless the date is extended or the Rights are redeemed or exchanged earlier by the Board.
We have several equity compensation plans (stock option, restricted stock and stock purchase plans) for the benefit of certain officers,
directors and employees. As a result of acquisitions, we also have 17 other option plans under which no further awards have been made since
the date of acquisition. Under the active equity compensation plans, we were authorized to grant up to 117.3 million shares as of March 31,
2005, of which 100.8 million shares have been granted.
The following is a summary of options outstanding at March 31, 2005:
Expiration dates range from April 2005 to February 2015.
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O
p
tions Outstandin
g
O
p
tions Exercisable
Wei
g
hted-
Number of Average Weighted- Number of
Options Remaining Average Options Weighted-
Range of Exercise Outstanding At Contractual Exercise Exercisable at Average
Prices Year End Life (Years) Price Year End Exercise Price
$ 0.01 - $ 13.67 87,467 4 $ 0.75 77,467 $ 0.84
$ 13.68 - $ 27.35 4,899,316 4 21.58 4,706,291 21.41
$ 27.36 - $ 41.02 41,766,275 6 33.04 41,102,059 33.09
$ 41.03 - $ 54.70 1,917,743 3 47.59 1,917,743 47.59
$ 54.71 - $ 68.37 724,392 3 58.26 724,392 58.26
$ 68.38 - $ 82.04 8,972,847 3 72.90 8,972,847 72.90
$ 82.05 - $ 95.72 389,532 3 90.76 389,532 90.76
$ 95.73 - $123.07 373,334 3 113.50 373,334 113.50
$ 123.08 - $136.74 373,334 3 136.74 373,334 136.74
59,504,240 5 40.37 58,636,999 40.54