Adaptec 2002 Annual Report Download - page 75

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Under the program, participants were able to tender for cancellation stock options granted within the
specified period with exercise prices at or above $8.00 per share, in exchange for new options to be granted
at least six months and one day after the cancellation of the tendered options. Pursuant to the terms and
conditions set forth in the Company's offer, each eligible participant will receive a new option to purchase
an equivalent number of PMC shares for each tendered option with an exercise price of less than $60.00. For
each tendered option with an exercise price of $60.00 or more, each eligible participant will receive a new
option to purchase a number of PMC shares equal to one share for each four unexercised shares subject to the
tendered option.
On September 26, 2002, the Company accepted and cancelled 19.3 million options with a weighted average
exercise price of $35.98 and expects to grant approximately 16.5 million new options no earlier than March
27, 2003 and no later than April 30, 2003. The new options will have an exercise price equal to the closing
price of the Company's common stock on the date of grant and will be subject to a new vesting schedule.
NOTE 12. Income Taxes
The income tax provisions, calculated under Statement of Financial Accounting
Standard No. 109 (SFAS 109), consist of the following:
Year Ended December 31,
−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−
(in thousands) 2002 2001 2000
−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−
Current:
Federal $ − $ − $ 40
State 4 4 224
Foreign (27,291) (7,034) 100,880
−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−
(27,287) (7,030) 101,144
−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−
Deferred:
Federal − − (72)
Foreign 8,429 (10,733) 1,340
−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−
8,429 (10,733) 1,268
−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−
Provision for income taxes $ (18,858) $ (17,763) $ 102,412
==================================================
A reconciliation between the Company's effective tax rate and the U.S. Federal
statutory rate is as follows:
73