Share-Based Compensation

We maintain a long-term incentive plan (the Plan) for key team members and non-employee members of our Board of Directors. The Plan allows us to grant equity-based compensation awards, including stock options, stock appreciation rights, performance share units, restricted stock units, restricted stock awards, or a combination of awards (collectively, share-based awards). The number of unissued common shares reserved for future grants under the Plan was 31.5 million and 14.0 million at January 30, 2016 and January 31, 2015, respectively.

Compensation expense associated with share-based awards is recognized on a straight-line basis over the shorter of the vesting period or the minimum required service period. Share-based compensation expense for continuing operations recognized in the Consolidated Statements of Operations was $118 million, $73 million, and $106 million in 2015, 2014, and 2013, respectively. The related income tax benefit was $46 million, $29 million, and $41 million in 2015, 2014, and 2013, respectively.

Share information includes all outstanding awards for continuing and discontinued operations.

Restricted Stock

We issue restricted stock units and performance-based restricted stock units generally with three-year cliff vesting from the grant date (collectively restricted stock) to certain team members. The final number of shares issued under performance-based restricted stock units will be based on our total shareholder return relative to a retail peer group over a three-year performance period. We also regularly issue restricted stock units to our Board of Directors, which vest quarterly over a one-year period and are settled in shares of Target common stock upon departure from the Board. The fair value for restricted stock is calculated based on the stock price on the date of grant, incorporating an analysis of the total shareholder return performance measure where applicable. The weighted average grant date fair value for restricted stock was $73.76, $70.50, and $62.76 in 2015, 2014, and 2013, respectively.



Restricted Stock Activity	Total Nonvested Units
	Restricted Stock ^(a)		Grant Date Fair Value ^(b)
January 31, 2015	4,713		$	65.11
Granted	1,677		73.76
Forfeited	(704	)	65.87
Vested	(1,460	)	61.51
January 30, 2016	4,226		$	69.49


^(a)	Represents the number of shares of restricted stock, in thousands. For performance-based restricted stock units, assumes attainment of maximum payout rates as set forth in the performance criteria. Applying actual or expected payout rates, the number of outstanding restricted stock units and performance-based restricted stock units at January 30, 2016 was 3,471 thousand.


^(b)	Weighted average per unit.

The expense recognized each period is partially dependent upon our estimate of the number of shares that will ultimately be issued. At January 30, 2016, there was $149 million of total unrecognized compensation expense related to restricted stock, which is expected to be recognized over a weighted average period of 1.3 years. The fair value of restricted stock vested and converted to shares of Target common stock was $90 million, $40 million, and $28 million in 2015, 2014, and 2013, respectively.

Performance Share Units

We issue performance share units to certain team members that represent shares potentially issuable in the future. Issuance is based upon our performance relative to a retail peer group over a three-year performance period on certain measures including domestic market share change, return on invested capital, and EPS growth. In 2015 we also issued strategic alignment performance share units to certain team members. Issuance is based on performance against four strategic metrics identified as vital to Target's success, including total sales growth, digital channel sales growth, EBIT growth, and return on invested capital, over a two-year performance period. The fair value of performance share units is calculated based on the stock price on the date of grant. The weighted average grant date fair value for performance share units was $74.19, $73.12, and $57.22 in 2015, 2014, and 2013, respectively.



Performance Share Unit Activity	Total Nonvested Units
	Performance Share Units ^(a)		Grant Date Fair Value ^(b)
January 31, 2015	3,600		$	63.16
Granted	2,190		74.19
Forfeited	(1,728	)	60.48
Vested	(39	)	55.58
January 30, 2016	4,023		$	70.70


^(a)	Represents the number of performance share units, in thousands. Assumes attainment of maximum payout rates as set forth in the performance criteria. Applying actual or expected payout rates, the number of outstanding units at January 30, 2016 was 1,812 thousand.


^(b)	Weighted average per unit.

The expense recognized each period is dependent upon our estimate of the number of shares that will ultimately be issued. Future compensation expense for unvested awards could reach a maximum of $230 million assuming payout of all unvested awards. The unrecognized expense is expected to be recognized over a weighted average period of 2.0 years. The fair value of performance share units vested and converted was $2 million in 2015, $11 million in 2014, and $14 million in 2013.

Stock Options

Through 2013, we granted nonqualified stock options to certain team members that generally vest and become exercisable annually in equal amounts over a four-year period and expire 10 years after the grant date. We previously granted options with a ten-year term to the non-employee members of our Board of Directors that vest immediately, but are not exercisable until one year after the grant date.



Stock Option Activity	Stock Options
	Total Outstanding						Exercisable
	Number of Options ^(a)		Exercise Price ^(b)		Intrinsic Value ^(c)		Number of Options ^(a)	Exercise Price ^(b)		Intrinsic Value ^(c)
January 31, 2015	16,725		$	53.04	$	344	12,843	$	52.02	$	277
Granted	—		—
Expired/forfeited	(404	)	55.77
Exercised/issued	(5,821	)	52.07
January 30, 2016	10,500		$	53.47	$	199	9,405	$	52.57	$	187


^(a)	In thousands.


^(b)	Weighted average per share.


^(c)	Represents stock price appreciation subsequent to the grant date, in millions.



Stock Option Exercises (millions)	2015		2014		2013
Cash received for exercise price	$	303	$	374	$	422
Intrinsic value	159		143		197
Income tax benefit	77		41		77

The weighted average remaining life of exercisable options is 4.6 years, and the weighted average remaining life of all outstanding options is 4.7 years. The total fair value of options vested was $23 million, $37 million, and $53 million in 2015, 2014, and 2013, respectively.