Seagate 2010 Annual Report Download - page 112

Table of Contents
SEAGATE TECHNOLOGY PLC
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Stock Compensation Expense
The Company recorded $51 million, $57 million and $83 million of stock-based compensation during fiscal years 2011, 2010 and 2009,
respectively. Management has made an estimate of expected forfeitures and is recognizing compensation costs only for those equity awards
expected to vest. When estimating forfeitures, the Company considers voluntary termination behavior as well as analysis of actual forfeited
awards.
Cash Flows from Excess Tax Benefits
The cash flows resulting from excess tax benefits (tax benefits related to the excess of proceeds from employee's exercises of stock options
over the stock-
based compensation cost recognized for those options) are classified as financing cash flows. The Company did not recognize any
cash flows from excess tax benefits during fiscal years 2011, 2010 and 2009.
Stock Option Activity
The Company issues new ordinary shares upon exercise of stock options. The following is a summary of option activities:
The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the quoted price of the
Company's ordinary shares for the options that were in-the-money at July 1, 2011. During fiscal years 2011, 2010 and 2009, the aggregate
intrinsic value of options exercised under the Company's stock option plans was $76 million, $41 million and $12 million, respectively,
determined as of the date of option exercise. The aggregate fair value of options vested during fiscal year 2011 was approximately $44 million.
At July 1, 2011, the total compensation cost related to options granted to employees but not yet recognized was approximately $28 million,
net of estimated forfeitures of approximately $1 million. This cost is being amortized on a straight-line basis over a weighted-average remaining
term of approximately 2.4 years and will be adjusted for subsequent changes in estimated forfeitures.
105
Options
Number of
Shares
Weighted
-
Average
Exercise
Price
Weighted
-
Average
Remaining
Contractual
Term
Aggregate
Intrinsic
Value
(In millions)
(In years)
(Dollars In millions)
Outstanding at July 2, 2010
54.6
$
12.73
3.9
$
232
Granted
3.1
12.14
Exercised
(7.9
)
6.45
Forfeitures
(1.3
)
9.59
Expirations
(2.1
)
21.74
Outstanding at July 1, 2011
46.4
$
13.44
3.3
$
259
Vested and expected to vest at July 1,
2011
45.2
$
13.59
3.1
$
247
Exercisable at July 1, 2011
32.8
$
16.14
2.6
$
126