TiVo 2004 Annual Report Download - page 78

Table of Contents
Index to Financial Statements
1999 Employee Stock Purchase Plan
In July 1999, the Company adopted the 1999 Employee Stock Purchase Plan (the "Employee Stock Purchase Plan"). The Employee Stock Purchase
Plan provides a means for employees to purchase TiVo common stock through payroll deductions of up to 15% of their base compensation. The Company
offers the common stock purchase rights to eligible employees, generally all full-time employees who have been employed for at least 10 days. This plan
allows for common stock purchase rights to be granted to employees of TiVo at a price equal to the lower of 85% of the fair market value on the first day of
the offering or on the common stock purchase date. Each offering consists of up to two purchase periods. The purchase periods currently begin on May 1 and
on November 1 of each year and are six months in length. Under the Employee Stock Purchase Plan, the board may, in the future, specify offerings up to 27
months. On August 15, 2002, the board amended the 1999 Employee Stock Purchase Plan to change the effective date for automatic annual increases to the
reserve of shares issuable under the plan from December 31 to October 31. Effective October 31, 2002, the board approved the maximum annual increase of
500,000 shares to the total number of shares reserved for issuance under the Employee Stock Purchase Plan pursuant to the plan's automatic annual increase
provision. As of January 31, 2005, the total number of shares reserved for issuance under this plan is 2,500,000. The number of shares available for stock
option issuance under this plan is subject to an annual increase on each October 31 through October 31, 2008, equal to the lowest of (i) 5 percent of the
outstanding shares of common stock on a diluted basis, (ii) 500,000 shares, or (iii) a smaller number as determined by the board of directors. There were
434,083 shares of common stock issued as a result of purchases under the Employee Stock Purchase Plan during the year ended January 31, 2005. As of
January 31, 2005, of the total 2,500,000 shares reserved for issuance under the Employee Stock Purchase Plan, there were 778,939 shares available for future
purchases.
A summary of the stock options activity for the 1997 Equity Incentive Plan, the 1999 Equity Incentive Plan and the 1999 Non-Employee Directors'
Stock Option Plan is presented in the table and narrative below:
Shares
Range of Exercise
Prices
Weighted
Average
Exercise
Prices
Outstanding at January 31, 2002 10,634,966 $ 9.86
Granted 2,366,800 $ 2.67 - $5.50 $ 3.95
Exercised (620,436) $ 2.47
Canceled (943,234) $ 9.71
Outstanding at January 31, 2003 11,438,096 $ 9.05
Granted 3,913,033 $ 4.98 - $13.50 $ 7.36
Exercised (1,555,287) $ 4.75
Canceled (582,472) $ 8.56
Outstanding at January 31, 2004 13,213,370 $ 9.09
Granted 4,070,750 $ 3.98 - $12.16 $ 6.77
Exercised (448,086) $ 8.42
Canceled (1,268,761) $ 11.46
Outstanding at January 31, 2005 15,567,273 $ 8.44
The weighted average fair values of options granted, whose option price equals the fair market value of the Company's common stock on the grant date,
during the fiscal years ended January 31, 2005, 2004, and 2003 were $2.92, $3.15, and $1.72, respectively.
On September 20, 2004 a stock option grant of 150,000 shares was made to a new employee with an option price less than the fair market value of the
Company's common stock for the date of grant. These stock options were granted as part of a compensation package pursuant to Nasdaq Marketplace Rule
4350(i)(1)(A0(iv) without stockholder approval. Stock options to purchase 58,000 shares were granted during the fiscal year ended January 31, 2004 with
option prices less than the fair market value of the Company's common stock for the date of grant.
A compensatory stock award of 35,000 shares of the company's common stock was granted to an employee during the fiscal year ended January 31,
2004. The fair value of the compensatory stock award granted during the fiscal year ended January 31, 2004 was $369,950 based on the closing price of
$10.57 per share on the date of grant.