HEWLETT PACKARD CO | 2013 | FY | 3


 
  2013   2012  

Weighted-average fair value of grants per unit

  $ 13.14 (1) $ 27.00 (2)

(1)
Reflects the weighted-average fair value for the second year of the three-year performance period applicable to PRUs granted in fiscal 2012. The estimated fair value of the Target Shares for the third year for PRUs granted in fiscal year 2012 will be determined on the measurement date applicable to those PRUs, which will occur during the period that the annual performance goals are approved for those PRUs, and the expense will be amortized over the remainder of the applicable three-year performance period.

(2)
Reflects the weighted-average fair value for the first year of the three-year performance period applicable to PRUs granted in fiscal 2012.

hpq:ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentOtherThanOptionsGrantsInPeriodWeightedAverageGrantDateFairValueTableTextBlock

Information about options outstanding at October 31, 2013 was as follows:

 
  Options Outstanding    
   
 
 
  Options Exercisable  
 
   
  Weighted-
Average
Remaining
Contractual
Life
   
 
Range of Exercise Prices
  Shares
Outstanding
  Weighted-
Average
Exercise
Price
  Shares
Exercisable
  Weighted-
Average
Exercise
Price
 
 
  In thousands
  In years
   
  In thousands
   
 

$0-$9.99

    616     4.3   $ 7     595   $ 7  

$10-$19.99

    27,161     6.7   $ 14     3,991   $ 14  

$20-$29.99

    18,906     5.6   $ 25     8,204   $ 25  

$30-$39.99

    20,018     0.5   $ 32     19,940   $ 32  

$40-$49.99

    16,422     1.4   $ 43     16,263   $ 43  

$50-$59.99

    667     3.2   $ 52     580   $ 52  

$60 and over

    252     0.7   $ 73     252   $ 73  
                             

 

    84,042     3.9   $ 27     49,825   $ 33  
                             

us-gaap:ScheduleOfShareBasedCompensationSharesAuthorizedUnderStockOptionPlansByExercisePriceRangeTextBlock

 
  2013   2012   2011  
 
  Shares   Weighted-
Average
Exercise
Price
  Weighted-
Average
Remaining
Contractual
Term
  Aggregate
Intrinsic
Value
  Shares   Weighted-
Average
Exercise
Price
  Weighted-
Average
Remaining
Contractual
Term
  Aggregate
Intrinsic
Value
  Shares   Weighted-
Average
Exercise
Price
  Weighted-
Average
Remaining
Contractual
Term
  Aggregate
Intrinsic
Value
 
 
  In thousands
   
  In years
  In millions
  In thousands
   
  In years
  In millions
  In thousands
   
  In years
  In millions
 

Outstanding at beginning of year

    87,296   $ 29                 120,243   $ 28                 142,916   $ 28              

Granted(1)

    25,785   $ 15                 7,529   $ 27                 18,804   $ 21              

Exercised

    (10,063 ) $ 19                 (29,683 ) $ 20                 (37,121 ) $ 23              

Forfeited/cancelled/expired

    (18,976 ) $ 25                 (10,793 ) $ 35                 (4,356 ) $ 39              
                                                                     

Outstanding at end of year

    84,042   $ 27     3.9   $ 303     87,296   $ 29     3.0   $ 15     120,243   $ 28     3.0   $ 460  
                                                                     

Vested and expected to vest at end of year

    80,004   $ 27     3.7   $ 274     85,935   $ 29     2.9   $ 15     117,066   $ 28     2.9   $ 442  
                                                                     

Exercisable at end of year

    49,825   $ 33     1.8   $ 58     68,437   $ 31     1.9   $ 12     97,967   $ 29     2.0   $ 332  
                                                                     

(1)
In connection with fiscal 2011 acquisitions, HP assumed options to purchase approximately 6 million shares with a weighted-average exercise price of $14 per share.

us-gaap:ScheduleOfShareBasedCompensationStockOptionsActivityTableTextBlock

 
  2013   2012   2011  

Weighted-average fair value of grants per option(1)

  $ 4.26   $ 9.06   $ 7.85  

Expected volatility(2)

    42 %   42 %   41 %

Risk-free interest rate(3)

    1.07 %   1.17 %   1.20 %

Expected dividend yield(4)

    3.64 %   1.83 %   1.97 %

Expected term in months(5)

    71     67     63  

(1)
The fair value calculation was based on stock options granted during the period.

(2)
Determined using implied volatility from traded options on HP's stock.

(3)
Determined using the yield on U.S. Treasury zero-coupon issues.

(4)
Determined using a constant dividend yield during the expected term of the option.

(5)
Determined using historical exercise and post-vesting termination patterns.

us-gaap:ScheduleOfShareBasedPaymentAwardStockOptionsValuationAssumptionsTableTextBlock

 
  2013   2012   2011  

Weighted-average fair value of grants per unit

  $ 0.00 (1) $ 3.35 (2) $ 27.59 (3)

Expected volatility(4)

    33 %   41 %   30 %

Risk-free interest rate

    0.18 %   0.14 %   0.38 %

Expected dividend yield

    3.94 %   1.78 %   0.75 %

Expected term in months

    12     15     19  

(1)
Reflects the weighted-average fair value for the third year of the three-year performance period applicable to PRUs granted in fiscal 2011. The weighted-average fair value per unit is zero based on the result of the Monte-Carlo simulation model using the weighted-average assumptions on the measurement date.

(2)
Reflects the weighted-average fair value for the third year of the three-year performance period applicable to PRUs granted in fiscal 2010 and for the second year of the three-year performance period applicable to PRUs granted in fiscal 2011.

(3)
Reflects the weighted-average fair value for the third year of the three-year performance period applicable to PRUs granted in fiscal 2009, for the second year of the three-year performance period applicable to PRUs granted in fiscal 2010 and for the first year of the three-year performance period applicable to PRUs granted in fiscal 2011.

(4)
HP uses historic volatility for PRU awards when simulating multivariate prices for companies in the S&P 500.

us-gaap:ScheduleOfShareBasedPaymentAwardStockOptionsValuationAssumptionsTableTextBlock