Avid 2004 Annual Report Download - page 75

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61
Canceled
(114,508)
$19.55
(258,371)
$16.27
(530,953)
$16.47
Options outstanding at December 31,
3,584,189
$24.19
4,233,477
$17.58
6,842,557
$14.46
Options exercisable at December 31,
1,592,944
$18.74
1,943,057
$16.27
4,308,706
$15.18
Options available for future grant at
December 31,
1,474,151
2,188,769
3,213,214
The below-fair-value options were granted in connection with the purchase of M-Audio (see Note F).
The following table summarizes information about stock options outstanding at December 31, 2004:
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
$0.01 to $9.96
290,600
6.86
$6.65
106,298
$5.35
$9.98 to $12.80
663,742
6.37
$12.01
459,707
$12.13
$12.81 to $14.12
75,735
5.24
$13.46
64,489
$13.45
$14.13 to $20.25
630,240
5.93
$15.11
384,447
$15.65
$20.50 to $22.01
804,978
7.38
$21.89
310,076
$21.74
$23.01 to $62.03
1,118,894
8.35
$43.47
267,927
$37.60
$0.01 to $62.03
3,584,189
7.15
$24.19
1,592,944
$18.74
Had compensation cost for the Company’s stock-based compensation plans been determined based on the fair value at the
grant dates for the awards under these plans consistent with the methodology prescribed under SFAS No. 123, the
Company’s net income (loss) and earnings (loss) per share would have been adjusted to the pro forma amounts shown in
Note B – “Summary of Significant Accounting Policies,” as required under SFAS No. 148 “Accounting for Stock-Based
Compensation – Transition and Disclosure.”
Under SFAS 123, the fair value of each option grant is estimated on the date of grant using the Black-Scholes option
pricing model with the following weighted-average assumptions and results:
Stock Options
Stock Purchase Plan
2004
2003
2002
2004
2003
2002
Expected dividend yield
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
Risk-free interest rate
2.2%
2.0%
3.8%
1.9%
1.1%
3.8%
Expected volatility
61%
69%
73%
38%
71%
73%
Expected life (in years)
3.40
3.51
3.44
0.25
0.43
0.5
Fair value of options granted at
fair value
$19.66
$12.30
$6.94
$5.89
$7.97
$3.79
Fair value of options granted
below fair value
$35.14
–
–
–
–
–
L. EMPLOYEE BENEFIT PLANS
Employee Benefit Plans
The Company has a defined contribution employee benefit plan under section 401(k) of the Internal Revenue Code
covering substantially all U.S. employees. The 401(k) plan allows employees to make contributions up to a specified
percentage of their compensation. The Company may, upon resolution by the Board of Directors, make discretionary
contributions to the plan. The Company’s contribution to the plan is 50% of up to the first 6% of an employee’s salary
contributed to the plan by the employee. The Company’s contributions to this plan totaled $2.4 million, $2.1 million, and
$1.5 million in 2004, 2003 and 2002, respectively.