Qualcomm 2006 Annual Report Download - page 86

72 qualcomm 2006
Notes to Consolidated Financial Statements continued
The Company’s determination of fair value of share-based payment awards on the date of grant using an option-pricing model is affected
by the Company’s stock price as well as assumptions regarding a number of highly complex and subjective variables. At September 24,
2006, total unrecognized estimated compensation cost related to non-vested stock options granted prior to that date was $1.2 billion,
which is expected to be recognized over a weighted-average period of 1.7 years. Total share-based compensation cost capitalized as part
of inventory and xed assets was $1 million during scal 2006. The total intrinsic value of stock options exercised during scal 2006 was
$1.1 billion. The Company recorded cash received from the exercise of stock options of $608 million and related tax benets of $421 million
during scal 2006. Upon option exercise, the Company issues new shares of stock.
Additional information about stock options outstanding at September 24, 2006 with exercise prices less than or above $37.86 per share,
the closing price at September 24, 2006, follows (number of shares in thousands):
Exercisable Unexercisable Total
Weighted Weighted Weighted
Average Average Average
Number Exercise Number Exercise Number Exercise
Stock Options of Shares Price of Shares Price of Shares Price
Less than $37.86 98,804 $19.59 37,751 $26.57 136,555 $21.52
Above $37.86 23,068 45.10 42,232 45.36 65,300 45.27
Total outstanding 121,872 $24.42 79,983 $36.49 201,855 $29.20
Information under FAS 123 for Periods Prior to Fiscal 2006. A summary of stock option transactions for all stock option plans follows
(number of shares in thousands):
Options Outstanding
Shares Exercise Price Per Share
Available Number Weighted
for Grant of Shares Range Average
Balance at September 28, 2003 23,746 212,972 $0.07 to $86.19 $17.28
Additional shares reserved 64,000 — — —
Options granted (31,252) 31,252 21.50 to 40.40 27.19
Options cancelled 4,420 (4,420) 2.30 to 70.00 28.15
Options exercised — (36,220) 0.14 to 37.34 7.85
Balance at September 26, 2004 60,914 203,584 $0.07 to $86.19 $20.25
Additional shares reserved(1) 765 — — —
Options assumed(1) (765) 765 0.09 to 38.48 24.32
Plan shares expired(2) (57) — — —
Options granted (34,434) 34,434 33.01 to 44.55 38.51
Options cancelled 5,821 (5,821) 1.60 to 70.00 31.16
Options exercised — (30,168) 0.07 to 43.00 11.52
Balance at September 25, 2005 32,244 202,794 $0.09 to $86.19 $24.35
(1) Represents activity related to options that were assumed as a result of acquisitions (Note 11).
(2) Represents shares available for future grant cancelled pursuant to the Iridigm and Spike acquisitions.
There were approximately 124,491,000 options exercisable with a weighted average exercise price of $21.11 per share at September 25,
2005. There were approximately 124,650,000 options exercisable with a weighted average exercise price of $17.41 per share at
September 26, 2004.
Employee Stock Purchase Plans
The Company has two employee stock purchase plans for all eligible
employees to purchase shares of common stock at 85% of the lower
of the fair market value on the rst or the last day of each six-month
offering period. Employees may authorize the Company to withhold
up to 15% of their compensation during any offering period, subject
to certain limitations. The 2001 Employee Stock Purchase Plan
authorizes up to approximately 24,309,000 shares to be granted.
The 1996 Non-Qualied Employee Stock Purchase Plan authorizes
up to 400,000 shares to be granted. During scal 2006, 2005 and
2004, approximately 2,220,000, 1,786,000 and 2,205,000 shares
were issued under the plans at an average price of $31.10, $29.63
and $18.60 per share, respectively. At September 24, 2006, approxi-
mately 13,226,000 shares were reserved for future issuance.