Hewlett-Packard (HPQ)

Stock-based Compensation Expense and the Related Income Tax Benefits

        Total stock-based compensation expense before income taxes for fiscal 2009, 2008 and 2007 was $635 million, $606 million and $629 million, respectively. The resulting income tax benefit for fiscal 2009, 2008 and 2007 was $199 million, $178 million and $182 million, respectively.

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HEWLETT-PACKARD COMPANY AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

Note 2: Stock-Based Compensation (Continued)

        Cash received from option exercises and purchases under the ESPP in fiscal 2009 was $1.8 billion. The actual tax benefit realized for the tax deduction from option exercises of the share-based payment awards in fiscal 2009 totaled $252 million. Cash received from option exercises and purchases under the ESPP in fiscal 2008 was $1.8 billion. The actual tax benefit realized for the tax deduction from option exercises of the share-based payment awards in fiscal 2008 totaled $412 million.

Stock-based Compensation Expense and the Related Income Tax Benefits

        HP allocated stock-based compensation expense as follows for each of the fiscal years:

⁽¹⁾

Includes $105 million, $84 million and $58 million of stock-based compensation expense, net of taxes, relating to stock awards assumed through acquisitions and restricted stock awards granted in fiscal 2008, 2007, and 2006, respectively.

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HEWLETT-PACKARD COMPANY AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

Note 2: Stock-Based Compensation (Continued)

        Cash received from option exercises and purchases under the ESPP in fiscal 2008 was $1.8 billion. The actual tax benefit realized for the tax deduction from option exercises of the share-based payment awards in fiscal 2008 totaled $412 million. Cash received from option exercises and purchases under the ESPP in fiscal 2007 was $3.1 billion. The actual tax benefit realized for the tax deduction from option exercises of the share-based payment awards in fiscal 2007 totaled $675 million.

Stock-based Compensation Expense and the Related Income Tax Benefits

        HP allocated stock-based compensation expense as follows for each of the fiscal years:

⁽¹⁾

Includes
$105 million, $84 million and $58 million of stock-based compensation expense, net of taxes, relating to stock
awards assumed through acquisitions and restricted stock awards granted in fiscal 2008, 2007, and 2006, respectively.

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HEWLETT-PACKARD COMPANY AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

Note 2: Stock-Based Compensation (Continued)

        Cash
received from option exercises and purchases under the ESPP in fiscal 2008 was $1.8 billion. The actual tax benefit realized for the tax deduction from option exercises of
the share-based payment awards in fiscal 2008 totaled $412 million. Cash received from option exercises and purchases under the
ESPP in fiscal 2007 was $3.1 billion. The actual tax benefit realized for the tax deduction from option exercises of the share-based payment awards in fiscal 2007 totaled $675 million.