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STOCK PROGRAMS | 9 Months Ended
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Mar. 31, 2021
Share-based Payment Arrangement [Abstract] |
STOCK PROGRAMS | STOCK PROGRAMS Total net stock-based compensation expense is attributable to the granting of, and the remaining requisite service periods of stock options, restricted stock units (“RSUs”), performance share units (“PSUs”), long-term PSUs, long-term price-vested units (“PVUs”) and share units. Compensation expense attributable to net stock-based compensation was $86 million and $71 million for the three months ended March 31, 2021 and 2020, respectively, and was $255 million and $210 million for the nine months ended March 31, 2021 and 2020, respectively. Stock Options During the nine months ended March 31, 2021, the Company granted stock options in respect of approximately 1.5 million shares of Class A Common Stock with an exercise price per share of $218.40 and a weighted-average grant date fair value per share of $54.61. The fair value of each option grant was estimated on the date of grant using the Black-Scholes option-pricing model. The aggregate intrinsic value of stock options exercised during the nine months ended March 31, 2021 was $317 million. Restricted Stock Units The Company granted RSUs in respect of approximately 1.0 million shares of Class A Common Stock during the nine months ended March 31, 2021 with a weighted-average grant date fair value per share of $219.01 that, at the time of grant, are scheduled to vest as follows: 0.3 million in fiscal 2022, 0.4 million in fiscal 2023 and 0.3 million in fiscal 2024. Vesting of RSUs is generally subject to the continued employment or the retirement of the grantees. The RSUs are accompanied by dividend equivalent rights, payable upon settlement of the RSUs either in cash or shares (based on the terms of the particular award) and, as such, were valued at the closing market price of the Company’s Class A Common Stock on the date of grant. Performance Share Units During the nine months ended March 31, 2021, the Company granted PSUs with a target payout of approximately 0.1 million shares of Class A Common Stock with a weighted-average grant date fair value per share of $218.11, which will be settled in stock subject to the achievement of the Company’s net sales and diluted net earnings per common share for the three fiscal years ending June 30, 2023, all subject to continued employment or the retirement of the grantees. For PSUs granted, no settlement will occur for results below the applicable minimum threshold. PSUs are accompanied by dividend equivalent rights that will be payable in cash upon settlement of the PSUs and, as such, were valued at the closing market value of the Company’s Class A Common Stock on the date of grant. In September 2020, approximately 0.2 million shares of the Company’s Class A Common Stock were issued, and related accrued dividends were paid, relative to the target goals set at the time of the issuance, in settlement of 0.5 million PSUs which vested as of June 30, 2020. Long-term Performance Share Units In March 2021, the Company granted to the Company’s Chief Executive Officer (“CEO”) PSUs with an aggregate payout of 68,578 shares of the Company's Class A Common Stock, to incentivize him to continue serving through at least June 30, 2024. Generally, no portion of this award will vest unless the Company has achieved positive Cumulative Operating Income, as defined in the performance share unit award agreement, during the relevant performance period, and delivery of shares of the Company’s Class A Common Stock, if any, will be made on September 2, 2025. The PSUs are accompanied by dividend equivalent rights that will be payable in cash at the same time as any delivery of shares of the Company's Class A Common Stock. The aggregate grant date fair value of the PSUs of approximately $20 million was estimated using the closing stock price of the Company's Class A Common Stock on the date of grant. As of March 31, 2021, the total unrecognized compensation cost related to unvested PSU awards was $20 million and the related period over which it is expected to be recognized is approximately 3.3 years, subject to the performance condition being met. Long-term Price-Vested Units In March 2021, the Company granted to the Company’s CEO PVUs with an aggregate payout of 85,927 shares, divided into three tranches, of the Company's Class A Common Stock, to incentivize him to continue serving through at least June 30, 2024. Generally, no portion of this award will vest unless the Company has achieved positive Cumulative Operating Income, as defined in the price-vested unit award agreement, during the relevant performance period. In addition, the vesting of each tranche is contingent upon the Company’s achievement of the respective stock price goal, which means that the average closing price per share of the Company’s Class A Common Stock traded on the New York Stock Exchange be at or above the applicable stock price goal (noted in the table below) for 20 consecutive trading days during the applicable performance period. The number of shares subject to each tranche of the price-vested unit award, as well as the stock price goals, service periods, performance periods and share delivery dates for each tranche are as follows:
|  | Number of Shares per Tranche |  | Stock Price Goal (per Share) |  | Service Period |  | Performance Period for Stock Price Goal |  | Performance Period for Cumulative Operating Income Goal |  | Share Delivery Date
First tranche |  | 27,457 |  |  | $ | 323.03 |  |  | March 11, 2021 - June 30, 2024 |  | March 11, 2021 - June 30, 2024 |  | July 1, 2021 - June 30, 2025 |  | September 2, 2025
Second tranche |  | 28,598 |  |  | $ | 333.21 |  |  | March 11, 2021 - June 30, 2024 |  | March 11, 2021 - June 30, 2024 |  | July 1, 2021 - June 30, 2025 |  | September 2, 2025
Third tranche |  | 29,872 |  |  | $ | 343.61 |  |  | March 11, 2021 - June 30, 2024 |  | March 11, 2021 - June 30, 2024 |  | July 1, 2021 - June 30, 2025 |  | September 2, 2025
Total shares |  | 85,927 |  |  |  |  |  |  |  |  |  |  |
Generally, delivery of shares of the Company’s Class A Common Stock, if any, will be made on September 2, 2025. The PVUs are accompanied by dividend equivalent rights that will be payable in cash at the same time as any delivery of shares of the Company's Class A Common Stock. The aggregate grant date fair value of the PVUs of approximately $20 million was estimated using the Monte Carlo Method, which requires certain assumptions. The assumptions used for this award were as follows:
Expected volatility |  | 31.8 | %
Dividend yield |  | 0.8 | %
Risk-free interest rate |  | 0.4 | %
Expected term |  | 3.3 years
As of March 31, 2021, the total unrecognized compensation cost related to unvested PVU awards was $20 million and the related period over which it is expected to be recognized is approximately 3.3 years, subject to the performance conditions and stock price goals being met.

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