TiVo 2003 Annual Report Download - page 73

Table of Contents
1999 Equity Incentive Plan
In April 1999, the Company's stockholders approved the 1999 Equity Incentive Plan (the "1999 Plan"). Amendments to the 1999 Plan were adopted in
July 1999. The 1999 Plan allows the grant of options to purchase shares of the Company's common stock to employees and other individuals at a price equal
to the fair market value of the common stock at the date of grant. The options vest 25 percent after the first year of service, and the remaining 75 percent vest
ratably over the next 36 months. Options expire 10 years after the grant date, based on continued employment. If the optionee's employment terminates,
options expire 90 days from the date of termination. The terms of the 1999 Plan allow individuals to early exercise options granted prior to August 8, 2001
from the date of grant, prior to full vesting. For options granted subsequent to August 8, 2001, options are exercisable only as the options vest. In the event
that the individual terminates their employment or service to the Company before becoming fully vested, the Company has the right to repurchase any
exercised, unvested shares at the original option price. As of January 31, 2004, the number of shares authorized for option grants under the 1999 Plan is
26,322,952, which includes the annual increase of 5,217,886 shares, which was effective December 31, 2003. The number of shares authorized for option
grants is subject to an annual increase of the greater of 7% of outstanding shares or 4,000,000 shares, up to a maximum of 40,000,000 shares. As of January
31, 2004, 11,345,431 shares of the total authorized remain available for future stock option grants. As of January 31, 2004, options to purchase 12,691,568
shares of common stock are outstanding under the Company's 1999 Equity Incentive Plan of which 7,868,160 are exercisable.
1999 Non-Employee Directors' Stock Option Plan
In July 1999, the Company adopted the 1999 Non-Employee Directors' Stock Option Plan (the "Directors' Plan"). The Directors' Plan provides for the
automatic grant of options to purchase shares of the Company's common stock to non-employee directors at a price equal to the fair market value of the stock
at the date of the grant. Initial options granted to new directors vest monthly over two years from the date of grant. Annual options granted to existing
directors vest upon grant. The option term is ten years after the grant date, based on continued director service. If the director's service terminates, options
expire 90 days from the date the director's service terminated. The number of shares authorized for option grants under the Directors' Plan is 1,000,000,
subject to an annual increase of 100,000 shares. The annual increase of 100,000 shares authorized for grant under the Directors' Plan was made December 31,
2003. As of January 31, 2004, 688,333 shares of the total authorized remain available for future grants. As of January 31, 2004, options to purchase 290,000
shares of common stock are outstanding, of which 197,499 are exercisable under the Company's 1999 Non-Employee Director's Stock Option Plan.
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 period or on the common stock purchase date. The offering periods begin on May 1 and on November 1 of each year. Under the Employee Stock
Purchase Plan, the board may 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, 2004, the total number of shares reserved for issuance under this plan is
2,000,000. 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 408,096 shares of common stock issued as a result of purchases under the Employee Stock Purchase Plan
during the year ended January 31, 2004. As of January 31, 2004, of the total 2,000,000 shares reserved for issuance under the Employee Stock Purchase Plan,
there were 713,022 shares available for future purchases.
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