Plantronics 2005 Annual Report Download - page 99

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part ii
Stock through payroll deductions. The plan qualifies under Section 423 of the Internal Revenue Code.
Under the 2002 ESPP, which is effective through June 2012, the purchase price of our Common Stock is
equal to 85% of the lesser of the fair market value of our Common Stock on (i) the first day of the
offering period, or (ii) the last day of the offering period. Each offering period is six months long.
There were 56,806, 48,472 and 71,498 shares issued under the ESPP in fiscal 2003, 2004 and 2005,
respectively.
FAIR VALUE DISCLOSURES. All options in fiscal 2003, 2004 and 2005 were granted at an exercise
price equal to the market value of Plantronics’ Common Stock at the date of grant.
The fair value of options at date of grant was estimated using the Black-Scholes model. The following
assumptions were used and weighted-average fair values resulted:
Employee Stock
Employee Stock Options Purchase Plan
Fiscal Year Ended March 31, 2003 2004 2005 2003 2004 2005
Expected dividend yield 0.0% 0.0% 0.47% 0.0% 0.0% 0.53%
Expected life (in years) 6.0 6.0 5.1 0.5 0.5 0.5
Expected volatility 59.4% 56.0% 58.2% 46.2% 38.5% 33.4%
Risk-free interest rate 3.4% 3.2% 3.4% 1.2% 1.0% 2.4%
Weighted-average fair value $9.72 $14.81 $20.70 $3.02 $4.61 $7.07
Volatility is a measure of the amount by which a price has fluctuated over an historical period. The higher
the volatility, the more the returns on the stock can be expected to vary. The risk free interest rate is the
rate on a U.S. Treasury bill or bond that approximates the expected life of the option.
11. Goodwill and Intangibles
The aggregate amortization expense on intangibles for fiscal 2003, 2004 and 2005 was $0.9 million,
$0.7 million and $0.7 million, respectively. The following table presents information on acquired
intangible assets (in thousands):
2004 2005
Gross Gross
Carrying Accumulated Carrying Accumulated Useful
March 31, Amount Amortization Amount Amortization Life
Intangible assets
Technology $2,460 $(1,103) $2,460 $(1,389) 7 years
State contracts 1,300 (418) 1,300 (604) 7 years
Patents 1,170 (283) 1,420 (470) 7 years
Customer lists 533 (533) 533 (533) 3 years
Trademarks 300 (96) 300 (139) 7 years
Non-compete
agreements 200 (90) 200 (130) 5 years
Total $5,963 $(2,523) $6,213 $(3,265)
AR 2005 ⯗71