iRobot 2009 Annual Report Download - page 112

On February 12, 2010, the Company entered into an agreement to amend its credit facility, including the
following changes:
• The amount available for borrowing was reduced to $40 million.
• Under the amended agreement, the interest on loans under the Company’s credit facility will accrue, at its
election, at either (i) the greater of the BBA LIBOR Daily Floating Rate or the Prime Rate of Lender plus
fifty (50) basis points, or (ii) the LIBOR rate plus 2.00%.
• The credit facility termination date was extended to June 5, 2012.
• The borrowing base calculation was deleted from the agreement.
• A minimum specified interest coverage ratio covenant was added to the financial covenants.
• The minimum specified annual net income covenant was replaced with a minimum adjusted EBITDA covenant.
8. Common Stock
Common stockholders are entitled to one vote for each share held and to receive dividends if and when
declared by the Board of Directors and subject to and qualified by the rights of holders of the preferred stock. Upon
dissolution or liquidation of the Company, holders of common stock will be entitled to receive all available assets
subject to any preferential rights of any then outstanding preferred stock.
9. Stock Option Plans
The Company has options outstanding under three stock incentive plans: the 1994 Stock Option Plan (the “1994
Plan”), the 2004 Stock Option and Incentive Plan (the “2004 Plan”) and the 2005 Stock Option and Incentive Plan (the
“2005 Plan” and together with the 1994 Plan and the 2004 Plan, the “Plans”). The 2005 Plan is the only one of the three
plans under which new awards may currently be granted. Under the 2005 Plan, which became effective October 10,
2005, 1,583,682 shares were initially reserved for issuance in the form of incentive stock options, non-qualified stock
options, stock appreciation rights, deferred stock awards and restricted stock awards. Additionally, the 2005 Plan
provides that the number of shares reserved and available for issuance under the plan will automatically increase each
January 1, beginning in 2007, by 4.5% of the outstanding number of shares of common stock on the immediately
preceding December 31. Stock options returned to the Plans as a result of their expiration, cancellation or termination are
automatically made available for issuance under the 2005 Plan. Eligibility for incentive stock options is limited to those
individuals whose employment status would qualify them for the tax treatment associated with incentive stock options in
accordance with the Internal Revenue Code of 1986, as amended. As of January 2, 2010, there were 3,124,979 shares
available for future grant under the 2005 Plan.
Options granted under the Plans are subject to terms and conditions as determined by the compensation
committee of the board of directors, including vesting periods. Options granted under the Plans are exercisable in
full at any time subsequent to vesting, generally vest over periods from zero to five years, and expire seven or ten
years from the date of grant or, if earlier, 60 or 90 days from employee termination. The exercise price of incentive
stock options is equal to the closing price on the NASDAQ Global Market on the date of grant. The exercise price of
nonstatutory options may be set at a price other than the fair market value of the common stock.
On September 25, 2009, in connection with his employment, the Company granted the president of its newly-
created healthcare business unit a stock option exercisable for 100,000 shares of the Company’s common stock at
the closing price of $12.82 and 25,000 restricted stock units. The stock option will vest 25% on the first anniversary
of the grant date and quarterly over the following three years, and the restricted stock units will vest 25% on each
anniversary of the grant date.
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iROBOT CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)