Common Stock and Stock-Based Compensation (Tables)

12 Months Ended

May 31, 2011

Schedule of Compensation Cost for Share-based Payment Arrangements, Allocation of Share-based Compensation Costs by Plan

The following table summarizes the Company’s total stock-based compensation expense recognized in selling and administrative expense:


	Year Ended May 31,
	2011		2010		2009
	(in millions)
Stock options⁽¹⁾	$	77	$	135	$	129
ESPPs		14		14		14
Restricted stock		14		10		8

Subtotal		105		159		151
Stock options and restricted stock expense — restructuring ⁽²⁾		—		—		20

Total stock-based compensation expense	$	105	$	159	$	171

⁽¹⁾

Expense for stock options include the expense associated with stock appreciation rights. Accelerated stock option expense is recorded for employees eligible for accelerated stock option vesting upon retirement. In the first quarter of fiscal 2011, the Company changed the accelerated vesting provisions of its stock option plan. Under the new provisions, accelerated stock option expense for year ended May 31, 2011 was $12 million. The accelerated stock option expense for the years ended May 31, 2010 and 2009 was $74 million and $59 million, respectively.

⁽²⁾

In connection with the restructuring activities that took place during fiscal 2009, the Company recognized stock-based compensation expense relating to the modification of stock option agreements, allowing for an extended post-termination exercise period, and accelerated vesting of restricted stock as part of severance packages. See Note 16 — Restructuring Charges for further details.

Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions

pricing model, was $17.68, $23.43, and $17.13, respectively. The weighted average assumptions used to estimate these fair values are as follows:


	Year Ended May 31,
	2011			2010			2009
Dividend yield		1.6	%		1.9	%		1.5	%
Expected volatility		31.5	%		57.6	%		32.5	%
Weighted average expected life (in years)		5.0			5.0			5.0
Risk-free interest rate		1.7	%		2.5	%		3.4	%

Schedule of Share-based Compensation, Stock Options, Activity

The following summarizes the stock option transactions under the plan discussed above:


	Shares⁽¹⁾			Weighted Average Option Price
	(In millions)
Options outstanding May 31, 2008		36.6		$	40.14
Exercised		(4.0	)		35.70
Forfeited		(1.3	)		51.19
Granted		7.5			58.17

Options outstanding May 31, 2009		38.8		$	43.69
Exercised		(8.6	)		37.64
Forfeited		(0.6	)		51.92
Granted		6.4			52.79

Options outstanding May 31, 2010		36.0		$	46.60
Exercised		(7.0	)		42.70
Forfeited		(0.5	)		58.08
Granted		6.3			69.20

Options outstanding May 31, 2011		34.8		$	51.29
Options exercisable at May 31,
2009		21.4		$	36.91
2010		20.4			41.16
2011		20.1		$	44.05

⁽¹⁾

Includes activity on stock appreciation rights