Adobe 2001 Annual Report Download - page 89

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ADOBE SYSTEMS INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(In thousands, except share and per share data)
Note 11. Stockholders’ Equity (Continued)
In addition, in fiscal 2001, 2000, and 1999, we purchased call options from independent third parties
that entitled us to buy 3.9 million, 4.2 million, and 4.9 million shares, respectively, of our common stock on
certain dates at specified prices. At November 30, 2001, approximately 2.6 million call options were
outstanding that expire on various dates through July 2002 with an average exercise price of $24.09 per
share, resulting in a total potential cash outlay of approximately $63.3 million in fiscal 2002 if all call
options are exercised.
Currently, all put warrants have a corresponding call option with an identical expiry date.
Consequently, either the call option or put warrant, but not both, will be exercised.
We repurchased approximately 5.9 million, 7.2 million, and 22.4 million shares in fiscal 2001, 2000,
and 1999, respectively, at a cost of $319.9 million, $255.5 million, and $448.7 million, respectively.
Stock Repurchase Program II—Additional Authorization above Dilution Coverage
In September 1997, Adobe’s Board of Directors authorized, subject to certain business and market
conditions, the purchase of up to 60.0 million shares of our common stock over a two-year period. This
program was completed in the first quarter of fiscal 1999. Under this program, we repurchased
approximately 3.3 million shares in fiscal 1999 at a cost of $30.5 million.
In April 1999, the Board authorized a 5.0 million share repurchase program, which allows us to
purchase shares in the open market and enter into contracts to repurchase shares during future quarters by
selling put warrants and buying call options. During fiscal 2001, approximately 4.9 million put warrants
were written and 3.5 million call options were purchased at prices ranging from $32.60 to $39.58. As of
November 30, 2001, there were no put warrants or options outstanding in this program. During fiscal 2001,
we repurchased approximately 4.7 million shares at a cost of $165.2 million. We did not repurchase any
shares under this program in fiscal 2000.
In addition to the April 1999 5.0 million share repurchase program, our Board of Directors authorized
in March 2001, subject to certain business and market conditions, the purchase of up to an additional
5.0 million shares of our common stock over a two-year period. We have not made any purchases under
this 5.0 million share repurchase program.
Combined Programs
Our put and call option contracts provide that we, at our option, can settle with physical delivery or
net shares equal to the difference between the exercise price and the value of the option as determined by
the contract.
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