AMD 1997 Annual Report Download - page 86

ADVANCED MICRO DEVICES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)
12. STOCK-BASED BENEFIT PLANS
Stock Option Plans. The Company has several stock option plans under which
key employees have been granted incentive (ISOs) and nonqualified (NSOs) stock
options to purchase the Company's common stock. Generally, options are
exercisable within four years from the date of grant and expire five to ten
years after the date of grant. ISOs granted under the plans have exercise
prices of not less than 100 percent of the fair market value of the common
stock at the date of grant. Exercise prices of NSOs range from $0.01 to the
fair market value of the common stock at the date of grant. At December 28,
1997, 3,172 employees were eligible and participating in the plans.
On July 10, 1996, the Compensation Committee of the Board of Directors of
AMD approved a stock option repricing program pursuant to which employees of
the Company (excluding officers) could elect to cancel certain unexercised
stock options in exchange for new stock options with an exercise price of
$11.88, equal to the closing price of the Company's common stock on the New
York Stock Exchange on July 15, 1996. Approximately 6.1 million options were
eligible for repricing, of which 5.3 million were repriced. The vesting
schedules and expiration dates of repriced stock options were extended by one
year, and certain employees canceled stock options for four shares of common
stock in exchange for repriced options for three shares of common stock.
The following is a summary of stock option activity and related information:
1997 1996 1995
------------------ ------------------ -----------------------
WEIGHTED- WEIGHTED-
AVERAGE AVERAGE
EXERCISE EXERCISE PRICE
OPTIONS PRICE OPTIONS PRICE OPTIONS PER SHARE
------- --------- ------- --------- ------- --------------
(SHARES IN THOUSANDS)
Options:
Outstanding at
beginning of year.... 18,651 $12.17 16,329 $16.77 14,825 $0.50 - $30.25
Granted............... 3,392 34.33 11,245 12.96 4,327 3.13 - 35.88
Canceled.............. (782) 16.05 (7,042) 26.64 (510) 0.50 - 35.75
Exercised............. (3,481) 8.03 (1,881) 4.07 (2,313) 0.50 - 30.25
------ ------ ------
Outstanding at end of
year................. 17,780 17.07 18,651 12.17 16,329 0.50 - 35.88
====== ====== ======
Available for grant at
beginning of year.... 3,845 751 3,386
Available for grant at
end of year.......... 966 3,845 751
The following table summarizes information about options outstanding at
December 28, 1997:
OPTIONS OUTSTANDING OPTIONS EXERCISABLE
------------------------------------------------ --------------------------
NUMBER WEIGHTED-AVERAGE WEIGHTED- NUMBER WEIGHTED-
OUTSTANDING REMAINING CONTRACTUAL AVERAGE EXERCISABLE AVERAGE
RANGE OF EXERCISE PRICES AT 12/28/97 LIFE (YEARS) EXERCISE PRICE AT 12/28/97 EXERCISE PRICE
------------------------ ----------- --------------------- -------------- ----------- --------------
(SHARES IN THOUSANDS)
$ 0.01 - $ 9.38 2,953 5.34 $ 5.70 2,360 $ 5.89
9.50 - 11.88 4,718 7.51 11.71 2,374 11.61
12.13 - 18.75 5,744 7.54 14.50 2,409 14.36
18.81 - 44.50 4,365 8.68 33.93 1,156 29.52
------ -----
$ 0.01 - $44.50 17,780 7.45 17.07 8,299 13.28
====== =====
F-21
Source: ADVANCED MICRO DEVIC, 10-K405, March 03, 1998