As a result of the Separation of USPS, shared-based awards issued by the Company were modified. The number of stock options and exercise price were adjusted to generally preserve the intrinsic value immediately prior to the Separation. There was no incremental share-based compensation expense recognized as a result of the modification of the awards.

under the 2011 Omnibus Incentive Plan, the 2007 Employee Incentive Plan and the 2010 Non-Employee Director Incentive Plan (the “CSC Equity Incentive Plans”) held by CSC employees and non-employee directors were converted into an adjusted award relating to DXC common shares subject to the same terms and conditions after the HPES Merger as the terms and conditions applicable to such awards prior to the HPES Merger.

Under the terms of the CSC Equity Incentive Plans and the individual award agreements, all unvested equity incentive awards, including all stock options and CSC RSUs held by all participants under the plans, including its named executive officers and directors, are subject to accelerated vesting in whole or in part upon the occurrence of a change in control or upon the participant’s termination of employment on or after the occurrence of a change in control under certain circumstances ("CIC events"). As a result of CIC events triggered by the HPES Merger, approximately 3.6 million unvested awards became vested on April 1, 2017 and $26 million of incremental stock compensation expense was recognized. CSC options granted in fiscal 2017 vested 33% upon the HPES Merger; the remaining 67% were converted into DXC RSUs based on the accounting value of the options. These RSUs will vest on the second and third anniversaries of the original option grant date. For equity incentive awards granted by HPE under HPE equity incentive plans to HPES employees prior to the HPES Merger, outstanding options (vested and unvested) and unvested RSU awards were converted upon the HPES Merger into economically equivalent DXC option and RSU awards, with terms and conditions substantially the same as the terms of such awards prior to the HPES Merger.

In March 2017, prior to the HPES Merger, the board of directors and shareholders of HPES approved DXC’s 2017 Omnibus Incentive Plan (the “DXC Employee Equity Plan”), DXC’s 2017 Non-Employee Director Incentive Plan (the “DXC Director Equity Plan”) and DXC’s 2017 Share Purchase Plan (“DXC Share Purchase Plan”). The terms of the DXC Employee Equity Plan and DXC Director Equity Plans are substantially similar to the terms of the CSC Equity Incentive Plans. The former allows DXC to grant stock options (including incentive stock options), stock appreciation rights ("SARs"), restricted stock, RSUs (including PSUs), and cash awards intended to qualify for the performance-based compensation exemption to the $1 million deduction limit under Section 162(m) of the Internal Revenue Code (collectively the "Awards"). Awards are typically subject to vesting over the 3-year period following the grant date. Vested stock options are generally exercisable for a term of 10 years from the grant date. All of DXC’s employees are eligible for awards under the plan. The Company issues authorized but previously unissued shares upon the granting of stock options and the settlement of RSUs and PSUs.

The Compensation Committee of the Board of Directors has broad authority to grant awards and otherwise administer the DXC Employee Equity Plan. The plan became effective March 30, 2017 and will continue in effect for a period of 10 years thereafter, unless terminated earlier by the Board. The Board has the authority to amend the plan in such respects as it deems desirable, subject to approval of DXC’s stockholders for material modifications.

RSUs represent the right to receive one share of DXC common stock upon a future settlement date, subject to vesting and other terms and conditions of the award, plus any dividend equivalents accrued during the award period. In general, if the employee’s status as a full-time employee is terminated prior to the vesting of the RSU grant in full, then the RSU grant is automatically canceled on the termination date and any unvested shares and dividend equivalents are forfeited. Certain executives were awarded service-based "career share" RSUs for which the shares are settled over the 10 anniversaries following the executive's separation from service as a full-time employee, provided the executive complies with certain non-competition covenants during that period.

The terms of the DXC Director Equity Plan allow DXC to grant RSU awards to non-employee directors of DXC. Such RSU awards vest in full at the earlier of (i) the first anniversary of the grant date or (ii) the next annual meeting date, and are automatically redeemed for DXC common stock and dividend equivalents either at that time or, if an RSU deferral election form is submitted, upon the date or event elected by the director. Distributions made upon a director’s separation from the Board may occur in either a lump sum or in annual installments over periods of 5, 10, or 15 years, per the director’s election. In addition, RSUs vest in full upon a change in control of DXC.

The DXC Share Purchase Plan allows DXC’s employees located in the United Kingdom to purchase shares of DXC’s common stock at the fair market value of such shares on the applicable purchase date. There were 28,779 shares purchased under this plan during fiscal 2020.



	Fiscal Years Ended
(in millions)	March 31, 2020		March 31, 2019		March 31, 2018
Total share-based compensation cost	$	68	$	74	$	93
Related income tax benefit	$	12	$	15	$	21
Total intrinsic value of options exercised	$	8	$	44	$	136
Tax benefits from exercised stock options and awards	$	14	$	39	$	84

As of March 31, 2020, total unrecognized compensation expense related to unvested DXC RSUs, net of expected forfeitures was $123 million, respectively. The unrecognized compensation expense for unvested RSUs is expected to be recognized over a weighted-average period of 1.86 years.



	Number of Option Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value (in millions)
Outstanding as of March 31, 2017	4,767,396		$	38.70	8.01	$	145
Granted	—		$	—
HPE options converted to DXC options at Merger	2,654,970		$	46.56
CSC Options converted to RSUs due to Merger	(1,521,519	)	$	51.00
Exercised	(2,916,045	)	$	40.39		$	136
Canceled/Forfeited	(14,890	)	$	69.52
Expired	(36,411	)	$	36.69
Outstanding as of March 31, 2018 ⁽¹⁾	2,933,501		$	32.54	5.24	$	185
Granted	—		$	—
Issued due to Separation modification	400,170		$	31.72
Exercised	(969,103	)	$	37.33		$	44
Canceled/Forfeited	(14,607	)	$	48.33
Expired	(31,193	)	$	25.03
Outstanding as of March 31, 2019	2,318,768		$	30.40	4.80	$	79
Granted	—		$	—
Exercised	(331,172	)	$	31.36		$	8
Canceled/Forfeited	(2,213	)	$	55.95
Expired	(115,568	)	$	34.97
Outstanding as of March 31, 2020	1,869,815		$	29.92	4.27	$	—
Vested and expected to vest in the future as of March 31, 2020	1,869,815		$	29.92	4.27	$	—
Exercisable as of March 31, 2020	1,869,815		$	29.92	4.27	$	—



	As of March 31, 2020
	Options Outstanding				Options Exercisable
Range of Option Exercise Price	Number Outstanding	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term	Number Exercisable	Weighted Average Exercise Price
$8.96 - $24.47	545,394	$	19.03	2.85	545,394	$	19.03
$25.14 - $41.92	833,679	$	28.08	4.62	833,679	$	28.08
$42.05 - $58.80	490,742	$	45.13	5.24	490,742	$	45.13
	1,869,815				1,869,815

The total fair value of stock options vested during fiscal 2020, 2019 and 2018 was $0 million, $0 million and $22 million, respectively. The cash received from stock options exercised during fiscal 2020, 2019 and 2018 was $9 million, $34 million and $98 million, respectively.

The Company also grants PSUs, which generally vest over a period of 3 years. The number of PSUs that ultimately vest is dependent upon the Company’s achievement of certain specified financial performance criteria over a three-year period. If the specified performance criteria are met, awards are settled for shares of DXC common stock and dividend equivalents upon the filing with the SEC of the Annual Report on Form 10-K for the last fiscal year of the performance period. PSU awards include the potential for accelerated vesting of 25% of the shares granted after each of the first and second fiscal years if certain of the Company's performance targets are met early, and are subject to final vesting based on the participant's continued employment through the end of the three-year performance period. Compensation expense during the performance period is estimated at each reporting date using management's expectation of the probable achievement of the specified performance criteria and is adjusted to the extent the expected achievement changes. In the table below, such awards are reflected at the number of shares originally granted.



	Number of Shares		Weighted Average Grant Date Fair Value
Outstanding as of March 31, 2017	3,710,985		$	34.86
Granted	1,828,667		$	82.34
HPE RSUs converted to DXC RSUs due to Merger	95,816		$	69.34
Options converted to RSUs due to Merger	609,416		$	32.58
Released/Issued	(1,934,446	)	$	35.93
Canceled/Forfeited	(324,822	)	$	59.34
Outstanding as of March 31, 2018 ⁽¹⁾	3,985,616		$	47.25
Granted	1,136,002		$	77.10
Issued due to Separation modification	649,649		$	51.98
Released/Issued	(2,207,467	)	$	33.05
Canceled/Forfeited	(754,025	)	$	62.01
Outstanding as of March 31, 2019	2,809,775		$	67.27
Granted	3,166,405		$	45.58
Released/Issued	(1,039,346	)	$	54.39
Canceled/Forfeited	(762,358	)	$	59.46
Outstanding as of March 31, 2020	4,174,476		$	55.45

The Company has one stock incentive plan which authorizes the issuance of stock options, restricted stock and other share-based incentives to non-employee directors upon terms approved by the Company’s Board of Directors. As of March 31, 2020, 39,451 shares of DXC common stock remained available for the grant of future RSUs or other share-based incentives to nonemployee directors.

RSU awards to non-employee directors are granted at a price of $0. For RSU awards granted in fiscal 2014 and thereafter, RSUs vest and settle at the earlier of (i) the one-year anniversary of the grant date, or (ii) the date of the Company's first Annual Meeting of the Stockholders held after the grant date. Alternatively, settlement of the RSU may be deferred per election of the non-employee director. For awards granted in fiscal 2013 and prior, vested RSUs were automatically settled for shares of DXC common stock and dividend equivalents when the non-employee director ceases to be a director of the Company. At the holder’s election, the RSUs may be settled (i) in their entirety, upon the day the holder ceases to be a director, or (ii) in substantially equal amounts upon the first five, ten or fifteen anniversaries of such termination of service.



	Number of Shares		Weighted Average Grant Date Fair Value
Outstanding as of March 31, 2017	85,766		$	34.19
Granted	22,900		$	84.40
Released/Issued	(39,980	)	$	45.25
Canceled/Forfeited	(2,300	)	$	85.35
Outstanding as of March 31, 2018 ⁽¹⁾	66,386		$	37.26
Granted	19,200		$	87.88
Issued due to Separation modification	10,488		$	37.69
Released/Issued	(20,324	)	$	51.59
Canceled/Forfeited	—		$	—
Outstanding as of March 31, 2019	75,750		$	46.31
Granted	62,200		$	35.90
Released/Issued	(23,335	)	$	60.90
Canceled/Forfeited	—		$	—
Outstanding as of March 31, 2020	114,615		$	37.69