Acer 2009 Annual Report Download - page 55

(20) Stock-based compensation plans
As of December 31, 2009, details of the employee stock option plans (“ESOP”) were as follows:
Stock Options
Employee stock
option plan 1
Employee stock
option plan 2
Employee stock
option plan 3
Employee stock
option plan 4
Grant date 2008/11/31 2008/09/01 (note 1) 2008/09/01 (note 1) 2009/10/30
Granted shares (in thousands) 14,000 8,717 1,067 14,000
Contractual life (in years) 3 4.97 2 3
Vesting period 2 years of service
subsequent to grant
date
1~3 years of service
subsequent to grant
date
1 year of service
subsequent to grant
date
2 years of service
subsequent to grant
date
Qualied employees (note 2) (note 3) (note 3) (note 2)
Note 1: The Company assumed the employee stock option plans 2 and 3 through the acquisition of E-Ten on September 1, 2008.
Note 2: The options are granted to eligible employees of the Company and its domestic or foreign subsidiaries, in which the Company
directly or indirectly, owns 50% or more of the subsidiary’s voting shares.
Note 3: The options are granted to eligible employees of the Company’s subsidiaries, in which the Company directly or indirectly owns
50% or more of equity interests.
The Consolidated Company utilized the Black-Scholes or the binomial option pricing model to value the stock
options granted, and the fair value of the option and main inputs to the valuation models were as follows:
2008 2009
Employee stock
option plan 1
Employee stock
option plan 2
Employee stock
option plan 3
Employee stock
option plan 4
Exercise price (NT$) 25.28 44.50 16.90 42.90
Expected remaining contractual life (in years) 34.26 0.56 3
Fair market value for underlying securities –
Acer shares (NT$) 45.95 59.10 59.10 78.00
Fair value of options granted (NT$) 25.124 25.47 ~ 26.11 42.20 ~ 42.58 40.356
Expected volatility 45.01% 34.98% 37.35% 40.74%
Expected dividend yield note 4 note 4 note 4 note 4
Risk-free interest rate 2.50% 2.40% 1.84% 1.03%
Note 4: According to the employee stock option plan, the option prices are adjusted to take into account dividends paid on the underlying
security. As a result, the expected dividend yield is excluded from the calculation.
Movements in number of stock options outstanding:
2008
The Company’s employee stock
option plan E-Ten’s Employee stock option plan
Number of
options
(in thousands)
Weighted-
average exercise
price
(NT$)
Number of
options
(in thousands)
Weighted-
average exercise
price
(NT$)
Outstanding, beginning of year - - - -
Granted 14,000 25.28 9,784 41.49
Forfeited - - (518) -
Exercised - - (173) 16.90
Outstanding, end of year 14,000 25.28 9,,093 41.66
Exercisable, end of year - 406
2009
The Company’s Employee stock
option plan
E-Ten’s Employee stock
Option plan
Number of
options
(in thousands)
Weighted-
average exercise
price
(NT$)
Number of
options
(in thousands)
Weighted-
average exercise
price
(NT$)
Outstanding, beginning of year 14,000 25.28 9,093 41.90
Granted 14,000 42.90 - -
Forfeited - - (890) -
Exercised - - (3,083) 38.12
Outstanding, end of year 28,000 33.62 5,120 41.52
Exercisable, end of year - 1,541
In 2008 and 2009, the Consolidated Companies recognized the compensation costs from the employee stock
option plans of NT$37,856 an NT$298,952, respectively, which were accounted for under operating expenses.
(21) Restructuring charges
In 2008 and 2009, due to the acquisition of Gateway Inc. and Packard Bell B.V., the Consolidated Companies
recognized restructuring charges of NT$1,582,408 and NT$164,595, respectively, which were accounted for
under “restructuring cost” of non-operating expenses and loss in the accompanying statements of income. These
restructuring charges were associated with severance payments to employees and integration of the information
technology system.
(22) Net income from discontinued operations
On July 1, 2007, the Company disposed all of its ownership interest in a subsidiary, Sertek Inc. According to
the sales agreement, if Sertek Inc. was able to achieve the stipulated profit in 2007, the Company would be
entitled to a contingent consideration. Accordingly, the Company obtained the contingent consideration in cash
amounting to NT$99,843 in March 2008.
Acer Incorporated 2009 Annual Report
104.
Acer Incorporated 2009 Annual Report
105. Financial Standing