Adobe 2003 Annual Report Download - page 84

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were reserved for issuance upon exercise of outstanding options and approximately 0.7 million shares were
available for grant under the Directors Plan. The Directors Plan will continue until the earlier of (i)
termination by the Board or (ii) the date on which all of the shares available for issuance under the plan
have been issued and restrictions on issued shares have lapsed.
Stock option activity for fiscal 2003, 2002 and 2001 is presented below (in actual amounts):
November 28, 2003 November 29, 2002 November 30, 2001
Shares
Weighted-
Average
Exercise
Price
Shares
Weighted-
Average
Exercise
Price
Shares
Weighted-
Average
Exercise
Price
Outstanding at beginning of year ...
.
57,847,050 $ 35.64 54,284,317 $ 36.66 45,017,400 $ 38.26
Options granted ..............................
.
1,994,130 $ 33.12 11,973,680 $ 28.77 19,177,315 $ 28.38
Options exercised ...........................
.
(7,978,054) $ 23.81 (3,688,534) $ 15.99 (4,826,823) $ 12.55
Options canceled ............................
.
(9,393,473) $ 58.00 (4,722,413) $ 45.20 (5,083,575) $ 44.89
Outstanding at end of year..............
.
42,469,653 $ 32.80 57,847,050 $ 35.64 54,284,317 $ 36.66
Exercisable at end of year ..............
.
27,240,540 $ 34.60 26,402,239 $ 35.65 20,844,567 $ 29.27
Weighted average fair value of
options granted during the year ..
.
$ 11.69 $ 13.49 $ 15.20
Information regarding the stock options outstanding at November 28, 2003 is summarized below:
Options Outstanding Options Exercisable
Range of Exercise Prices
Number
Outstanding
Weighted
Average
Remaining
Contractual Life
Weighted
Average
Exercise
Price
Number
Exercisable
Weighted
Average Exercise
Price
$4.67 – 7.00................... 173,489 1.32 years $ 6.50 173,449 $ 6.46
$7.13 – 8.34................... 526,945 2.35 years 8.17 526,945 8.17
$8.45.............................. 3,132,913 2.50 years 8.45 3,132,343 8.45
$9.66 – 14.09................. 322,818 3.17 years 11.78 322,068 11.78
$14.86 – 22.19............... 632,833 5.81 years 18.47 266,478 18.35
$24.11 – 26.75............... 8,743,182 5.93 years 26.41 2,114,086 26.28
$26.95............................ 5,127,619 5.91 years 26.95 1,904,508 26.95
$27.00 – 27.69............... 5,537,400 5.32 years 27.65 3,954,894 27.68
$27.94 – 41.78............... 11,184,767 4.99 years 36.01 8,055,716 35.93
$44.05 – 65.34............... 6,930,021 4.75 years 59.06 6,633,628 59.06
$67.31 – 81.50............... 157,666 4.84 years 72.83 156,425 73.39
42,469,653 5.06 years $ 32.80 27,240,540 $ 34.60
Performance and Restricted Stock
The 1994 Performance and Restricted Stock Plan (“the Restricted Stock Plan”) provides for the
granting of restricted stock and/or performance awards to officers and key employees. As of November 28,
2003, we had reserved 8.0 million shares of our common stock for issuance under the Plan.
Restricted shares issued under the Restricted Stock Plan generally vest annually over two to three years
but are considered outstanding at the time of grant, as the stockholders are entitled to dividends and voting
rights. As of November 28, 2003, 24,593 shares were outstanding and not yet vested. In fiscal 2003, 2002,
and 2001, we granted 3,277, 9,321 and 56,146 shares of restricted stock, respectively, and the weighted
average fair value of the shares was $32.37, $27.88 and $39.44, respectively. Additionally, we charged $2.8
million, $6.8 million and $18.0 million to expense associated with restricted stock in fiscal 2003, 2002 and
2001, respectively. As of November 28, 2003, approximately 2.8 million shares were available for grant
under this Plan.
Performance awards issued under the Restricted Stock Plan entitle the recipient to receive, at our
discretion, shares or cash upon completion of the performance period subject to attaining identified
performance goals. Performance awards are generally measured over a three-year period and cliff vest at
the end of the three-year period. We accrue the projected value of these awards and charge this amount to