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Stock-Based Compensation
9 Months Ended
Sep. 30, 2015
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Stock-Based Compensation
Stock-Based Compensation
Aggregate stock-based compensation expense for the three and nine months ended September 30, 2015 was $3 million and $14 million, which reflects expense incurred for stock option and restricted stock unit awards granted under the Halyard Health, Inc. Equity Participation Plan and the Halyard Health, Inc. Outside Directors’ Compensation Plan (together, the “Plans”). Aggregate stock-based compensation expense for the three and nine months ended September 30, 2014 was $3 million and $5 million, which reflects expense allocated to us for awards granted under Kimberly-Clark’s equity incentive plans.
Stock Options
Stock-based compensation expense related to stock options was $1 million and $5 million for the three and nine months ended September 30, 2015. A summary of stock option activity under the Plans is presented below:
 
Shares
(in thousands)
 
Weighted-
Average
Exercise
Price
 
Weighted-
Average
Remaining
Contractual
Term (Years)
 
Aggregate
Intrinsic
Value
(in millions)
Outstanding at December 31, 2014
611

 
$
34.94

 
 
 
 
Granted
628

 
45.52

 
 
 
 
Exercises
(37
)
 
31.05

 
 
 
 
Forfeitures
(53
)
 
37.90

 
 
 
 
Outstanding at September 30, 2015
1,149

 
$
40.71

 
8.9
 
$
0.2

Exercisable at September 30, 2015
210

 
$
33.26

 
7.7
 
$
0.2


The following table summarizes information about options outstanding as of September 30, 2015:
 
 
 
 
Stock Options Outstanding
 
Stock Options Exercisable
Range of
Exercise Prices
 
Shares
(in thousands)
 
Weighted-
Average
Remaining
Contractual
Term (Years)
 
Shares
(in thousands)
 
Weighted- Average
Exercise
Price
$25
to
$35
 
215

 
7.3
 
125

 
$
29.97

$35
to
$45
 
320

 
8.8
 
77

 
37.45

$45+
 
614

 
9.5
 
8

 
45.53

 
 
 
 
1,149

 
8.9
 
210

 
$
33.26


Restricted Share Units
Stock-based compensation expense related to restricted share units was $2 million and $9 million for the three and nine months ended September 30, 2015. A summary of restricted share unit activity is presented below:
 
Shares
(in thousands)
 
Weighted-
Average
Fair Value
Outstanding at December 31, 2014
375

 
$
37.88

Granted
213

 
45.59

Vested
(62
)
 
38.29

Forfeitures
(23
)
 
39.43

Outstanding at September 30, 2015
503

 
$
41.02


Prior Year Expense under Kimberly-Clark Equity Incentive Plans
Kimberly-Clark maintains several equity incentive plans in which our executives and employees participated prior to the Spin-off. All awards granted under Kimberly-Clark’s plans were based on common shares of Kimberly-Clark stock and, as such, were reflected in Kimberly-Clark’s consolidated statements of equity and not in our combined statement of invested equity. Prior to the Spin-off, Kimberly-Clark allocated stock-based compensation expense to Halyard for employees of Kimberly-Clark’s health care business that became Halyard employees upon the Spin-off. Stock-based compensation expense charged to us by Kimberly-Clark under their incentive plans was $3 million and $5 million for the three and nine months ended September 30, 2014, respectively.