ADT 2006 Annual Report Download - page 37

Option Grants in Last Fiscal Year
The following table shows all grants of stock options to the Named Officers during fiscal 2006
under the Tyco International Ltd. 2004 Stock and Incentive Plan.
Percentage of
Total Options
No. of Securities Granted Exercise Grant Date
Underlying to Employees in Price Expiration Present
Named Officer Options Grant Fiscal Year(1) ($/Share)(2) Date Value ($)(4)
Edward D. Breen .......... 500,000 4.64% $29 11/21/2015 $4,678,850
Christopher J. Coughlin ...... 250,000 2.32% $29 11/21/2015 $2,339,425
William B. Lytton .......... 161,000 1.50% $29 11/21/2015 $1,506,590
Juergen Gromer ........... 107,333 1.00% $29 5/21/2016(3) $1,004,390
53,667 0.50% $29 11/21/2015 $ 502,200
Thomas Lynch ............ 140,000 1.30% $29 11/21/2015 $1,310,078
(1) Represents the percentage of all options granted in fiscal 2006 under the Tyco International Ltd.
2004 Stock and Incentive Plan.
(2) Options were granted at an exercise price equal to the fair market value of Tyco common shares
on the date of grant. The options vest one-third per year on each anniversary of the grant date.
Except as indicated for Dr. Gromer, options have a ten-year term, subject in certain cases to
earlier expiration following termination of employment.
(3) Represents the two-thirds portion of Dr. Gromer’s total option grants that are made with respect
to his Swiss employment services.
(4) Pursuant to SEC rules, the amounts report reflect a grant date present value calculated using the
Black-Scholes option-pricing model, which is a method of calculating the hypothetical value of
options on the date of grant. The following assumptions were used in calculating the Black-Scholes
values: expected time of exercise of five years; risk-free interest rate of 4.20%; assumed annual
volatility of underlying Tyco International common shares of 34%; and dividend yield on Tyco
International common shares of 1.4%. The interest rate represents the yield of a zero coupon U.S.
government bond on the grant date with a maturity date similar to the expected life of the option.
The assumed annual volatility was calculated based on ten years of historical Tyco International
share price movements and the grant date implied volatility rates for exchange traded options on
Tyco International shares. The dividend yield is based on the most recent dividend payment prior
to grant by Tyco International and the grant date price of Tyco International common shares.
Aggregated Option Exercises in Last Fiscal Year and Fiscal Year-End Option Values
The following table summarizes the exercise of options on Tyco International common shares by
the Named Officers during the fiscal year ended September 29, 2006 and the number and value of
unexercised options on Tyco International common shares held by such officers as of the end of the
fiscal year.
No. of Securities
Underlying Value of Unexercised,
Number of Unexercised Options at In-the Money Options
Shares Fiscal Year End Held at Fiscal Year End(1)
Acquired Value
Name On Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
Edward D. Breen ........ * * 7,150,000 1,900,000 $117,638,000 $14,368,000
Christopher J. Coughlin . . . * * 116,668 483,332 * *
Willam B. Lytton ........ * * 915,001 410,999 $ 9,476,086 $ 13,750
Juergen Gromer ......... 450,000 $5,486,685 2,365,309 419,332 $ 855,350 $ 15,125
Thomas Lynch .......... * * 343,334 411,666 * *
(1) Based on the price of $27.96, which is the average of the high and low prices of Tyco common
shares on the NYSE on September 29, 2006.
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