Electronic Arts 2009 Annual Report Download - page 29

Proxy Statement
• a risk-free interest rate (the weighted-average risk-free interest rate of all assumed Eligible Options was
2.3%); and
• no expected dividends.
The following table provides, for illustrative purposes only, information regarding the Exchange Program based on
the assumptions presented above and information regarding our outstanding stock options as of March 28, 2009:
Total Shares Subject to Eligible
Options(1)
Weighted-Average
Exercise Price of
the Eligible Options
Weighted-Average
Expected Term of
the Eligible
Options (in years)
Average
Exchange Ratio
(Surrendered
Stock Options
to New Restricted
Stock Units)
Total Restricted Stock Units
Granted (Assuming 100%
Participation)(2)
18,432,341 $49.76 6.1 3.4 to 1 5,482,504
1We may exclude an immaterial number of shares subject to Eligible Options in a few non-US jurisdictions,
where local laws would make the exchange of options for restricted stock units or restricted stock awards
infeasible or impractical.
2Fractional shares have been rounded down.
The total number of restricted stock units a participating employee will receive with respect to a surrendered
Eligible Option will be determined by dividing the number of shares subject to the surrendered option by the
applicable exchange ratio and rounding down to the nearest whole share.
The actual exchange ratios will be established just prior to the commencement of the Exchange Program, and
will vary from the assumptions presented in this discussion due to:
• the trading price of our common stock prior to the commencement of the Exchange Program in
comparison to the trading price used in determining the average exchange ratio set forth above,
• stock option forfeitures that may occur between March 28, 2009 and the commencement of the Exchange
Program, or
• a change to any of the other factors used in the Black-Scholes calculation used to determine the average
exchange ratio.
Outstanding options with an exercise price equal to or less than the 52-week high trading price of our common
stock prior to the Exchange Date will be excluded, as will any stock options granted within the 12 months
preceding the commencement of the Exchange Program.
Election to Participate. Eligible employees will receive a tender offer document and will be able to voluntarily
elect to participate in the Exchange Program. If you are both a stockholder and an employee holding Eligible
Options, note that voting to approve the Exchange Program does not constitute an election to participate in the
Exchange Program. The written exchange offer documents will be provided if and when the Exchange Program
is initiated; you can elect to participate only after that time. Eligible employees will have an election period of at
least 20 business days from the commencement of the Exchange Program in which to determine whether they
wish to participate.
Vesting of Restricted Stock Units. Restricted stock units issued in the Exchange Program will be completely
unvested at the time they are granted and will become vested on the basis of the participant’s continued
employment with us or any of our subsidiaries. The restricted stock units will have a minimum vesting period of
approximately one year and a maximum vesting period of three years from the Exchange Date, depending on the
extent to which the corresponding Eligible Options were vested upon surrender, as set forth in the table below.
21