Earthlink 2006 Annual Report Download - page 93

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EARTHLINK, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Employee Stock Purchase Plan
In January 2005, the Company terminated its employee stock purchase plan (“ESPP”). Under the terms of the ESPP, eligible employees
were able to have up to 15% of eligible compensation deducted from their pay to purchase EarthLink common stock. Under the ESPP,
withholdings were used to purchase shares at the beginning of each quarter at a per share purchase price equal to 85% of the lesser of the
closing price on the first trading day of the just completed quarter or the closing price on the last trading day of the just completed quarter.
During the years ended December 31, 2004 and 2005, employees purchased approximately 223,000 and 47,000 shares, respectively, pursuant
to the ESPP at weighted average per share purchase prices of $7.58 and $9.14, respectively.
Warrants
Prior to December 31, 2000, the Company issued warrants to purchase shares of the Company’s common stock to certain members of its
Board of Directors, customers, consultants, lessors, creditors and others. As of December 31, 2006, warrants to purchase a total of 61,000
shares of common stock were outstanding at exercise prices ranging from $4.02 to $5.50. The warrants are currently exercisable and expire at
various dates through October 2007.
During the year ended December 31, 2006, the Company sold warrants in connection with the issuance of Notes permitting the purchasers
to acquire up to approximately 28.4 million shares of the Company’s common stock. See Note 10, “Stockholders’ Equity,” for a description of
those warrants.
Options Outstanding
The following table summarizes information concerning stock option activity as of and for year ended December 31, 2006:
92
Weighted
Weighted
Average
Average
Remaining
Aggregate
Exercise
Contractual
Intrinsic
Stock Options
Price
Term (Years)
Value
(shares and dollars in thousands)
Outstanding as of December 31, 2005
19,831
$
11.90
Granted
3,729
7.94
Exercised
(717
)
6.00
Forfeited and expired
(2,373
)
12.88
Outstanding as of December 31, 2006
20,470
11.27
6.4
$
4,559
Vested and expected to vest as of December 31, 2006
18,691
$
11.52
6.1
$
4,386
Exercisable as of December 31, 2006
12,200
$
13.02
4.8
$
2,947