Avid 1996 Annual Report Download - page 33

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contributions of approximately $400,000, $302,000, and $123,000 in 1996, 1995, and 1994, respectively.
1997 Profit Sharing Plan. In January 1997, the Board of Directors approved the 1997 Profit Sharing Plan (the Plan). The
Plan, effective January 1, 1997, covers substantially all employees of the Company and its participating subsidiaries, other
than those employees covered by other incentive plans. The Plan provides that the Company contribute a varying
percentage of salary (0% to 10%) based on the Company’s achieved target of return on invested capital in 1997, as defined
by the Plan.
Stock Plans
1989 Stock Option Plan. The 1989 Stock Option Plan (the "1989 Plan") allows for the issuance of incentive and non-
qualified stock options to purchase the Company's Common Stock. Incentive stock options may not be granted at less than
the fair market value of the Company's Common Stock at the date of grant and are exercisable for a term not to exceed ten
years. For holders of 10% or more of the total combined voting power of all classes of the Company's stock, options may
not be granted at less than 110% of the fair market value of the Common Stock at the date of grant, and the option term
may not exceed 5 years. In connection with the establishment of the 1993 Stock Incentive Plan, the 1989 Plan was
amended to provide that, subject to certain exceptions, no further options or awards could be issued thereunder.
1991 Stock Option Plan. Digidesign had an employee stock option plan whereby an aggregate of 1,500,000 shares of
common stock were reserved for issuance. Effective upon the acquisition by Avid, the stock option agreements were
assigned to Avid and Avid registered the 670,884 shares, equivalent to the number of options outstanding, taking into effect
the exchange ratio of .79 shares of Avid Common Stock for each share of Digidesign Common Stock. Under the plan,
options may be granted to employees, directors, consultants, and advisors to the Company. Incentive stock options may be
granted at prices not lower than fair market value, as established by the Board of Directors on the date of grant. Non-
qualified stock options may be granted at not less than 85% of fair market value, as established by the Board of Directors on
the date of grant. Avid has not granted any options under this plan. The options expire in a maximum of ten years and
may be either incentive stock options or non-qualified stock options, determined at the discretion of the Board of Directors.
Options are immediately exercisable, subject to a right of repurchase which generally lapses as to 25% of the subject shares
on the first anniversary of the vesting commencement date, and as to an additional 2.083% for each succeeding full month of
continuous employment.
1993 Stock Incentive Plan. Under the 1993 Stock Incentive Plan (the "1993 Plan"), a maximum of 800,000 shares of
Common Stock may be issued upon exercise of incentive stock options or non-qualified stock options, or in connection
with awards of restricted stock grants, stock appreciation rights or performance shares. The terms of the incentive stock
options granted under this plan are substantially the same as for those granted under the 1989 Plan. The options generally
vest ratably over a four-year period.
1993 Director Stock Option Plan. The 1993 Director Stock Option Plan (the "Director Plan"), as amended April 12, 1996,
provides for the grant of options to purchase up to a maximum of 220,000 shares of Common Stock of the Company to
non-employee directors of the Company, at an exercise price equal to the fair market value of the stock on the date of grant.
Certain options vest immediately whereas other options vest ratably over a four-year period from the date of grant.
1994 Stock Option Plan. The 1994 Stock Option Plan, as amended on February 12, 1996, allows for the issuance of
incentive and non-qualified options to purchase up to a maximum of 2,400,000 shares of the Company's Common Stock.
The terms of the options granted under this plan are essentially the same as for those granted under the 1989 Plan.
1997 Stock Incentive Plan. In February 1997, the Board of Directors approved the 1997 Stock Incentive Plan. This plan,
which is subject to shareholder approval, covers employees, consultants, and directors of the Company, and allows for the
issuance of incentive and non-qualified stock options and restricted stock grants to purchase the Company’s Common Stock.
An aggregate of 1,000,000 shares of Common Stock are reserved for issuance under the plan including up to 500,000 shares
of restricted stock which may be issued pursuant to the plan.
Employee Stock Purchase Plan. On July 31, 1996, the 1993 Employee Stock Purchase Plan (the "1993 Purchase Plan")
expired and was replaced with the 1996 Employee Stock Purchase Plan. The 1996 Employee Stock Purchase Plan
authorizes the issuance of a maximum of 200,000 shares of Common Stock in semi-annual offerings at a price equal to the
lower of 85% of the closing price on the applicable offering commencement date or 85% of the closing price on the
applicable offering termination date.