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These excerpts taken from the C DEF 14A filed Mar 20, 2009. Table
I
Table of Contents
Our simple overhang and fully diluted overhang are stated in
Table II below, as of the February 27, 2009 record
date, and as estimated as of April 21, 2009, assuming the
new plan proposal is approved. The calculations are based on the
figures reported in Table I, and common shares outstanding
as of February 27, 2009. For these purposes, it is assumed
that the number of shares outstanding and the number of shares
subject to outstanding awards on April 21, 2009, will be
the same as on the record date. If the 2009 plan is approved, at
April 21, 2009, there will be a maximum of 108 million
shares available for grant as full-value awards, or a maximum of
250 million shares available for grant as stock options or
sars.
These figures do not include the 66.45 million shares
available for
purchase pursuant to the stockholder-approved, tax-qualified
2000 employee stock purchase plan, which expires on
April 30, 2010. However, these figures do include the
123.95 million shares subject to currently outstanding
options. As reported in Table I, the weighted average
exercise price of these options is $40.52, and their weighted
average remaining life is 2.9 years, making it extremely
unlikely that any shares will ever be issued on account of these
currently outstanding options. Additionally, shares subject to
these options will not become available for new awards if the
options are canceled or expire unexercised, or if any shares are
used to pay their exercise prices or withheld to pay taxes.
Table
II
“Burn rate” expresses the amount of equity in the form
of stock options or stock awards a company grants annually
relative to its number
of common shares outstanding. It is calculated as follows:
Table III shows our burn rates for the
12-month
periods ending December 31, 2006, 2007 and 2008, and the
three-year average. The calculations are based on annual grant
data contained in our annual reports on
Form 10-K
and the basic weighted average number of common shares
outstanding during those periods. The sharp increase in the burn
rate from
2007 to 2008 is due to the unanticipated decline in the market
price of the common stock in 2008. As mentioned previously,
significant changes were made to
cap, effective
with the January 2009 awards, in order to reduce the scope of
participation and the number of shares that would have to be
granted at current market prices.
Table
III
Table of Contents
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