Electronic Arts 2012 Annual Report Download - page 188

ESPP
Pursuant to our ESPP, eligible employees may authorize payroll deductions of between 2 percent and 10 percent
of their compensation to purchase shares at 85 percent of the lower of the market price of our common stock on
the date of commencement of the offering or on the last day of each six-month purchase period.
At our Annual Meeting of Stockholders, held on July 28, 2011, our stockholders approved amendments to the
ESPP to increase the number of shares authorized under the ESPP by 3.5 million shares. As of March 31, 2012,
we had 6 million shares of common stock reserved for future issuance under the ESPP.
During fiscal year 2012, we issued approximately 2.4 million shares under the ESPP with exercise prices for
purchase rights ranging from $12.95 to $15.98. During fiscal years 2012, 2011 and 2010, the estimated weighted-
average fair values of purchase rights were $4.98, $4.67 and $6.50, respectively.
We issue new common stock out of the ESPP’s pool of authorized shares. The fair values above were estimated
on the date of grant using the Black-Scholes option-pricing model assumptions.
Deferred Compensation Plan
We have a Deferred Compensation Plan (“DCP”) for the benefit of a select group of management or highly
compensated employees and Directors, which is unfunded and intended to be a plan that is not qualified within the
meaning section 401(a) of the Internal Revenue Code. The DCP permits the deferral of the annual base salary and/
or Director fees up to a maximum amount. The deferrals are held in a separate trust, which has been established by
us to administer the DCP. The trust is a grantor trust and the specific terms of the trust agreement provide that the
assets of the trust are available to satisfy the claims of general creditors in the event of our insolvency. The assets
held by the trust are classified as trading securities and are held at fair value on our Consolidated Balance Sheets.
The assets and liabilities of the DCP are presented in other assets and other liabilities on our Consolidated Balance
Sheets, respectively, with changes in the fair value of the assets and in the deferred compensation liability
recognized as compensation expense. The estimated fair value of the assets was $11 million and 12 million as of
March 31, 2012 and 2011, respectively. As of March 31, 2012 and 2011, $12 million and $13 million, respectively,
was recorded to recognize undistributed deferred compensation due to employees.
401(k) Plan and Registered Retirement Savings Plan
We have a 401(k) plan covering substantially all of our U.S. employees, and a Registered Retirement Savings
Plan covering substantially all of our Canadian employees. These plans permit us to make discretionary
contributions to employees’ accounts based on our financial performance. We contributed an aggregate of $13
million, $9 million and $10 million to these plans in fiscal years 2012, 2011 and 2010, respectively.
Stock Repurchase Program
In February 2011, we announced that our Board of Directors authorized a program to repurchase up to $600
million of our common stock over the next 18 months. We completed our program in April 2012. We
repurchased approximately 32 million shares in the open market since the commencement of the program,
including pursuant to pre-arranged stock trading plans. During the fiscal year 2012, we repurchased and retired
approximately 25 million shares of our common stock for approximately $471 million, net of commissions.
(15) ACCUMULATED OTHER COMPREHENSIVE INCOME
We classify items of other comprehensive income (loss) by their nature in a financial statement and display the
accumulated other comprehensive income balance separately from retained earnings (accumulated deficit) and
paid-in capital in the equity section of our Consolidated Balance Sheets. Accumulated other comprehensive
income primarily includes foreign currency translation adjustments and the net of tax amounts for unrealized
gains (losses) on available-for-sale securities and derivative instruments designated as cash flow hedges. Foreign
currency translation adjustments are not adjusted for income taxes as they relate to indefinite investments in
non-U.S. subsidiaries.
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