iRobot 2015 Annual Report Download - page 146

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Letter of Credit Facility
The Company has an unsecured revolving letter of credit facility with Bank of America, N.A. The credit facility is
available to fund letters of credit on the Company's behalf up to an aggregate outstanding amount of $5 million. The Company
may terminate at any time, subject to proper notice, or from time to time permanently reduce the amount of the credit facility.
The Company pays a fee on outstanding letters of credit issued under the credit facility of up to 1.5% per annum of the
outstanding letters of credit. The maturity date for letters of credit issued under the credit facility must be no later than 365
days following the maturity date of the credit facility.
As of January 2, 2016, there were letters of credit outstanding of $1.5 million under the revolving letter of credit
facility. The credit facility contains customary terms and conditions for credit facilities of this type, including restrictions on the
Company's ability to incur or guaranty additional indebtedness, create liens, enter into transactions with affiliates, make loans
or investments, sell assets, pay dividends or make distributions on, or repurchase stock, and consolidate or merge with other
entities. In addition, the Company is required to meet certain financial covenants customary with this type of agreement,
including maintaining a maximum ratio of indebtedness to Adjusted EBITDA and a minimum specified interest coverage ratio.
The credit facility also contains customary events of default, including for payment defaults, breaches of
representations, breaches of affirmative or negative covenants, cross defaults to other material indebtedness, bankruptcy, and
failure to discharge certain judgments. If a default occurs and is not cured within any applicable cure period or is not waived,
the lender may accelerate the obligations under the credit facility.
As of January 2, 2016, the Company was in compliance with all covenants under the revolving letter of credit facility.
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.
On April 2, 2014, the Company announced a stock repurchase program. Under the program, the Company may purchase
up to $50 million of its common stock from May 1, 2014 to April 30, 2015. On March 19, 2015, the Company announced an
additional stock repurchase program, which authorized the repurchase of $50 million of its common stock from May 1, 2015 to
April 30, 2016. During 2015 and 2014, the Company repurchased 1,260,276 shares totaling $37.4 million and 55,973 shares
totaling $1.7 million, respectively, in the open market under these stock repurchase plans. During the fourth quarter of 2015, the
Company replaced the then-current stock repurchase program with a new stock repurchase program, effective January 4, 2016
and ending on December 31, 2016, pursuant to which the Company is authorized to purchase up to one million shares or $40
million of its common stock, whichever occurs earlier.
9. Stock Option Plans and Stock-Based Compensation
The Company has options outstanding under three stock incentive plans: the 2005 Stock Option and Incentive Plan (the
"2005 Plan"), the Evolution Robotics, Inc. 2007 Stock Plan (the "2007 Plan") and the 2015 Stock Option and Incentive Plan
(the "2015 Plan" and together with the 2005 Plan and the 2007 Plan, the “Plans”). All options that remained outstanding under
the 2004 Stock Option and Incentive Plan as of December 27, 2014 were exercised during fiscal 2015. The 2015 Plan is the
only one of the three plans under which new awards may currently be granted. Under the 2015 Plan, which became effective
May 20, 2015, 3,100,000 shares were initially reserved for issuance in the form of incentive stock options, non-qualified stock
options, stock appreciation rights, deferred stock awards, restricted stock units, unrestricted stock awards, cash-based awards,
performance share awards and dividend equivalent rights. Stock awards returned to the Plans, with the exception of those
issued under the 2007 Plan, as a result of their expiration, cancellation or termination are automatically made available for
issuance under the 2015 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, 2016, there were 2,484,296 shares available for future grant under the 2015 Plan.