AMD 2007 Annual Report Download - page 247

Spansion Inc.
Notes to Consolidated Financial Statements—(Continued)
• a change in the Board such that individuals who comprised the Board at the effective date of the 2005 Equity Incentive Plan cease to constitute at
least a majority of the Board; and
• the consummation of a reorganization, share exchange, merger, consolidation, or a sale or other dispositions of all or substantially all of the
Company’s assets.
Shares Available to Grant
Number of awards available for grant under the 2005 Equity Incentive Plan:
Amounts reserved for grant 9,500,000
Stock options granted through December 31, 2006, net of cancelled stock options (2,134,906)
Restricted stock awards granted through December 31, 2006, net of cancelled restricted stock awards (3,749,503)
Shares available for grant 3,615,591
The Company grants stock options that generally vest ratably over a period of four years and expire if not exercised by the seventh anniversary of the grant
date. RSU awards have no exercise price or expiration date. The Company grants RSU awards that generally vest ratably over a four-year period, except for
awards of 2.3 million shares granted on the date of the Company’s IPO (December 15, 2005), which vested 25 percent on April 28, 2006 and the remainder in
equal installments quarterly over the remaining 36 months.
Valuation and Expense Information
The following table sets forth the total recorded stock-based compensation expense, by financial statement caption, resulting from the Company’s stock
options and RSU awards under Statement 123(R) for the year ended December 31, 2006:
Year Ended
Dec. 31, 2006
(in thousands)
Cost of sales $ 8,653
Research and development 4,326
Marketing, general and administrative 4,326
Stock-based compensation expense under Statement 123(R) before income taxes(1) 17,305
Income tax benefit(2) —
Stock-based compensation expense under Statement 123(R) after income taxes(1) $ 17,305
(1) Stock-based compensation expense under Statement 123(R) does not include the compensation expense of AMD stock options and AMD RSU awards
granted to the Company’s employees, which were accounted for under EITF Issue Nos. 96-18 and 00-12.
(2) There is no income tax benefit relating to stock option expenses because all of the Company’s U.S. deferred tax assets, net of U.S. deferred tax liabilities
continue to be subject to a full valuation allowance.
Source: ADVANCED MICRO DEVIC, 10-K, February 26, 2008