CDNS » Topics » Stock Options

This excerpt taken from the CDNS 10-Q filed May 1, 2009.
Stock Options
 
The exercise price of each stock option granted under Cadence’s employee equity incentive plans is equal to or greater than the market price of Cadence’s common stock on the date of grant. Generally, option grants vest over four years, expire no later than ten years from the grant date and are subject to the employee’s continuing service to Cadence. The options granted under the 1995 Directors Plan vest one year from the date of grant. Options assumed in connection with acquisitions generally have exercise prices that differ from the fair value of Cadence’s common stock on the date of acquisition and such options generally continue to vest under their original vesting schedules and expire on the original dates stated in the acquired company’s option agreements. The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model. The weighted average grant date fair value of options granted and the weighted average assumptions used in the Black-Scholes option pricing model for the three months ended April 4, 2009 and March 29, 2008 were as follows:
 
                 
    Three Months Ended  
    April 4,
    March 29,
 
    2009     2008  
 
Dividend yield
    None       None  
Expected volatility
    66.9%       45.0%  
Risk-free interest rate
    1.87%       2.51%  
Expected life (in years)
    4.5       4.5  
Weighted average fair value of options granted
  $ 2.27     $ 4.29  
 
The computation of the expected volatility assumption used in the Black-Scholes option pricing model for new grants is based on implied volatility. When establishing the expected life assumption, Cadence reviews annual historical employee exercise behavior with respect to option grants having similar vesting periods. The risk-free interest rate for the period within the expected term of the option is based on the yield of United States Treasury notes in effect at the time of grant. Cadence has not historically paid dividends, so the expected dividend yield used in the calculation is zero.
 
This excerpt taken from the CDNS 10-Q filed Dec 11, 2008.
Stock Options
 
The exercise price of each stock option granted under Cadence’s employee equity incentive plans is equal to or greater than the market price of Cadence’s common stock on the date of grant. Generally, option grants vest over four years, expire no later than ten years from the grant date and are subject to the employee’s continuing service to Cadence. The options granted under the 1995 Directors Plan vest one year from the date of grant. Options assumed in connection with acquisitions generally have exercise prices that differ from the fair value of Cadence’s common stock on the date of acquisition and such options generally continue to vest under their original vesting schedules and expire on the original dates stated in the acquired company’s option agreements. The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model. The weighted average grant date fair value of options granted and the weighted average assumptions used in the model for the three months ended March 29, 2008 and March 31, 2007 were as follows:
 
                 
    Three Months Ended  
    March 29,
    March 31,
 
    2008     2007  
 
Dividend yield
    None       None  
Expected volatility
    45.0%       23.0%  
Risk-free interest rate
    2.51%       4.54%  
Expected life (in years)
    4.5       4.4  
Weighted average fair value of options granted
  $ 4.29     $ 4.75  
 
The computation of the expected volatility assumption used in the Black-Scholes pricing model for new grants is based on implied volatility. When establishing the expected life assumption, Cadence reviews annual historical employee exercise behavior with respect to option grants having similar vesting periods. The risk-free interest rate for the period within the expected term of the option is based on the yield of United States Treasury notes in effect at the time of grant. Cadence has not historically paid dividends; thus the expected dividend yield used in the calculation is zero.


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This excerpt taken from the CDNS 10-Q filed Dec 11, 2008.
Stock Options
 
The exercise price of each stock option granted under Cadence’s employee equity incentive plans is equal to or greater than the market price of Cadence’s common stock on the date of grant. Generally, option grants vest over four years, expire no later than ten years from the grant date and are subject to the employee’s continuing service to Cadence. The options granted under the 1995 Directors Plan vest one year from the date of grant. Options assumed in connection with acquisitions generally have exercise prices that differ from the fair value of Cadence’s common stock on the date of acquisition and such options generally continue to vest under their original vesting schedules and expire on the original dates stated in the acquired company’s option agreements. The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model. The weighted average grant date fair value of options granted and the weighted average assumptions used in the model for the three and nine months ended September 27, 2008 and September 29, 2007 were as follows:
 
                                 
    Three Months Ended     Nine Months Ended  
    September 27,
    September 29,
    September 27,
    September 29,
 
    2008     2007     2008     2007  
 
Dividend yield
    N/A       None       None       None  
Expected volatility
    N/A       27.0%       42.9%       23.2%  
Risk-free interest rate
    N/A       4.26%       2.76%       4.68%  
Expected life (in years)
    N/A       4.4       4.5       4.4  
Weighted average fair value of options granted
    N/A     $ 6.41     $ 4.22     $ 5.14  
 
Cadence did not grant any stock options during the three months ended September 27, 2008. The computation of the expected volatility assumption used in the Black-Scholes pricing model for new grants is based on implied volatility. When establishing the expected life assumption, Cadence reviews annual historical employee exercise behavior with respect to option grants having similar vesting periods. The risk-free interest rate for the period within the expected term of the option is based on the yield of United States Treasury notes in effect at the time of grant. Cadence has not historically paid dividends; thus the expected dividend yield used in the calculation is zero.


5


Table of Contents

This excerpt taken from the CDNS 10-Q filed Dec 11, 2008.
Stock Options
 
The exercise price of each stock option granted under Cadence’s employee equity incentive plans is equal to or greater than the market price of Cadence’s common stock on the date of grant. Generally, option grants vest over four years, expire no later than ten years from the grant date and are subject to the employee’s continuing service to Cadence. The options granted under the 1995 Directors Plan vest one year from the date of grant. Options assumed in connection with acquisitions generally have exercise prices that differ from the fair value of Cadence’s common stock on the date of acquisition and such options generally continue to vest under their original vesting schedules and expire on the original dates stated in the acquired company’s option agreements. The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model. The weighted average grant date fair value of options granted and the weighted average assumptions used in the model for the three and six months ended June 28, 2008 and June 30, 2007 were as follows:
 
                                 
    Three Months Ended     Six Months Ended  
    June 28,
    June 30,
    June 28,
    June 30,
 
    2008     2007     2008     2007  
 
Dividend yield
    None       None       None       None  
Expected volatility
    38.0%       24.0%       42.9%       23.1%  
Risk-free interest rate
    3.36%       4.92%       2.76%       4.70%  
Expected life (in years)
    4.5       4.4       4.5       4.4  
Weighted average fair value of options granted
  $ 4.04     $ 6.24     $ 4.22     $ 5.09  


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The computation of the expected volatility assumption used in the Black-Scholes pricing model for new grants is based on implied volatility. When establishing the expected life assumption, Cadence reviews annual historical employee exercise behavior with respect to option grants having similar vesting periods. The risk-free interest rate for the period within the expected term of the option is based on the yield of United States Treasury notes in effect at the time of grant. Cadence has not historically paid dividends; thus the expected dividend yield used in the calculation is zero.
 
This excerpt taken from the CDNS 10-Q filed Jul 29, 2008.
Stock Options
 
The exercise price of each stock option granted under Cadence’s employee equity incentive plans is equal to or greater than the market price of Cadence’s common stock on the date of grant. Generally, option grants vest over four years, expire no later than ten years from the grant date and are subject to the employee’s continuing service to Cadence. The options granted under the 1995 Directors Plan vest one year from the date of grant. Options assumed in connection with acquisitions generally have exercise prices that differ from the fair value of Cadence’s common stock on the date of acquisition and such options generally continue to vest under their original vesting schedules and expire on the original dates stated in the acquired company’s option agreements. The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model. The weighted average grant date fair value of options granted and the weighted average assumptions used in the model for the three and six months ended June 28, 2008 and June 30, 2007 were as follows:
 
                                 
    Three Months Ended     Six Months Ended  
    June 28,
    June 30,
    June 28,
    June 30,
 
    2008     2007     2008     2007  
 
Dividend yield
    None       None       None       None  
Expected volatility
    38.0%       24.0%       42.9%       23.1%  
Risk-free interest rate
    3.36%       4.92%       2.76%       4.70%  
Expected life (in years)
    4.5       4.4       4.5       4.4  
Weighted average fair value of options granted
  $ 4.04     $ 6.24     $ 4.22     $ 5.09  
 
The computation of the expected volatility assumption used in the Black-Scholes pricing model for new grants is based on implied volatility. When establishing the expected life assumption, Cadence reviews annual historical employee exercise behavior with respect to option grants having similar vesting periods. The risk-free interest rate for the period within the expected term of the option is based on the yield of United States Treasury notes in effect at


5


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the time of grant. Cadence has not historically paid dividends; thus the expected dividend yield used in the calculation is zero.
 
This excerpt taken from the CDNS 10-Q filed Apr 25, 2008.
Stock Options
 
The exercise price of each stock option granted under Cadence’s employee equity incentive plans is equal to or greater than the market price of Cadence’s common stock on the date of grant. Generally, option grants vest over four years, expire no later than ten years from the grant date and are subject to the employee’s continuing service to Cadence. The options granted under the 1995 Directors Plan vest one year from the date of grant. Options assumed in connection with acquisitions generally have exercise prices that differ from the fair value of Cadence’s common stock on the date of acquisition and such options generally continue to vest under their original vesting schedules and expire on the original dates stated in the acquired company’s option agreements. The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model. The weighted average grant date fair value of options granted and the weighted average assumptions used in the model for the three months ended March 29, 2008 and March 31, 2007 were as follows:
 
                 
    Three Months Ended  
    March 29,
    March 31,
 
    2008     2007  
 
Dividend yield
    None       None  
Expected volatility
    45.0%       23.0%  
Risk-free interest rate
    2.51%       4.54%  
Expected life (in years)
    4.5       4.4  
Weighted average fair value of options granted
  $ 4.29     $ 4.75  
 
The computation of the expected volatility assumption used in the Black-Scholes pricing model for new grants is based on implied volatility. When establishing the expected life assumption, Cadence reviews annual historical employee exercise behavior with respect to option grants having similar vesting periods. The risk-free interest rate for the period within the expected term of the option is based on the yield of United States Treasury notes in effect at the time of grant. Cadence has not historically paid dividends; thus the expected dividend yield used in the calculation is zero.


5


Table of Contents

This excerpt taken from the CDNS 10-Q filed Oct 30, 2007.
Stock Options
 
The exercise price of each stock option granted under Cadence’s employee equity incentive plans is equal to or greater than the market price of Cadence’s common stock on the date of grant. Generally, option grants vest over four years, expire no later than ten years from the grant date and are subject to the employee’s continuing service to Cadence. The options granted under the 1995 Directors Stock Option Plan vest one year from the date of grant. Options assumed in connection with acquisitions generally have exercise prices that differ from the fair value of Cadence’s common stock on the date of acquisition and such options generally continue to vest under their original vesting schedules and expire on the original dates stated in the acquired company’s option agreements. The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model. The weighted average grant date fair value of options granted and the weighted average assumptions used in the model for the three and nine months ended September 29, 2007 and September 30, 2006 were as follows:
 
                                 
    Three Months Ended     Nine Months Ended  
    September 29,
    September 30,
    September 29,
    September 30,
 
    2007     2006     2007     2006  
 
Dividend yield
    None       None       None       None  
Expected volatility
    27.0%       24.1%       23.2%       24.6%  
Risk-free interest rate
    4.26%       4.59%       4.68%       4.83%  
Expected life (in years)
    4.4       5.3       4.4       5.4  
Weighted average fair value of options granted
  $ 6.41     $ 5.16     $ 5.14     $ 5.62  
 
The computation of the expected volatility assumption used in the Black-Scholes pricing model for new grants is based on implied volatility. When establishing the expected life assumption, Cadence reviews annual historical employee exercise behavior with respect to option grants having similar vesting periods. The risk-free interest rate for the period within the expected term of the option is based on the yield of United States Treasury notes in effect at the time of grant. Cadence has not historically paid dividends; thus the expected dividend yield used in the calculation is zero.
 
This excerpt taken from the CDNS 10-Q filed Jul 27, 2007.
Stock Options
 
The exercise price of each stock option granted under Cadence’s employee equity incentive plans is equal to or greater than the market price of Cadence’s common stock on the date of grant. Generally, option grants vest over four years, expire no later than ten years from the grant date and are subject to the employee’s continuing service to Cadence. The options granted under the 1995 Directors Stock Option Plan vest one year from the date of grant. Options assumed in connection with acquisitions generally have exercise prices that differ from the fair value of Cadence’s common stock on the date of acquisition and such options generally continue to vest under their original vesting schedule and expire on the original dates stated in the acquired company’s option agreements. The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model. The weighted average grant date fair value of options granted and the weighted average assumptions used in the model for the three and six months ended June 30, 2007 and July 1, 2006 were as follows:
 
                         
    Three Months Ended   Six Months Ended
    June 30,
  July 1,
  June 30,
  July 1,
    2007   2006   2007   2006
 
Dividend yield
    None     None     None     None
Expected volatility
    24.0%     27.0%     23.1%     24.7%
Risk-free interest rate
    4.92%     5.10%     4.70%     4.89%
Expected life (in years)
    4.4     5.4     4.4     5.4
Weighted average fair value of options granted
  $   6.24   $   6.44   $   5.09   $   5.74
 
The computation of the expected volatility assumption used in the Black-Scholes pricing model for new grants is based on implied volatility. When establishing the expected life assumption, Cadence reviews annual historical employee exercise behavior with respect to option grants having similar vesting periods. The risk-free interest rate for the period within the expected term of the option is based on the yield of United States Treasury notes in effect at the time of grant. Cadence has not historically paid dividends, thus the expected dividends used in the calculation are zero.
 
This excerpt taken from the CDNS 10-Q filed Apr 30, 2007.
Stock Options
 
The exercise price of each stock option granted under Cadence’s employee equity incentive plans is equal to or greater than the market price of Cadence’s common stock on the date of grant. Generally, option grants vest over four years, expire no later than ten years from the grant date and are subject to the employee’s continuing service to Cadence. The options granted under the 1995 Directors Stock Option Plan vest one year from the date of grant. Options assumed in connection with acquisitions generally have exercise prices that differ from the fair value of Cadence’s common stock on the date of acquisition and such options generally continue to vest under their original vesting schedule and expire on the original dates stated in the acquired company’s option agreements. The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model. The weighted average grant date fair value of options granted during the three months ended March 31, 2007 and April 1, 2006, was $4.75 and $5.50, respectively. The weighted average assumptions used in the model for the three months ended March 31, 2007 and April 1, 2006 were as follows:
 
                     
    Three Months Ended
    March 31,
          April 1,
    2007           2006
 
Dividend yield
    None             None
Expected volatility
    23.0%             24.0%
Risk-free interest rate
    4.54%             4.82%
Expected life (in years)
    4.4             5.4
 
The computation of the expected volatility assumption used in the Black-Scholes pricing model for new grants is based on implied volatility. When establishing the expected life assumption, Cadence reviews annual historical employee exercise behavior with respect to option grants having similar vesting periods. The risk-free interest rate for the period within the expected term of the option is based on the yield of United States Treasury notes in effect at the time of grant. Cadence has not historically paid dividends, thus the expected dividends used in the calculation are zero.
 
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