Symantec 2012 Annual Report Download - page 175

SYMANTEC CORPORATION
Notes to Consolidated Financial Statements — (Continued)
stockholders, respectively. In addition to the shares currently reserved under the 2004 Plan, any shares reacquired
by us from options outstanding under the 1996 Plan upon their cancellation will also be added to the 2004 Plan
reserve. As of March 30, 2012, 80 million shares remained available for future issuance.
Performance-based restricted stock units
During the first quarter of fiscal 2012, we granted PRUs to certain senior level employees under our 2004
Plan. The PRU grants are in lieu of the stock option grants typically awarded as part of our annual compensation
program. These PRUs can be earned depending upon the achievement of a company-specific performance
condition and a market condition as follows: (1) our achievement of an annual target earnings per share for fiscal
2012 and (2) our two and three year cumulative relative total shareholder return ranked against that of other
companies that are included in the Standard & Poor’s 500 Index. These PRUs are also subject to a three year
continued service vesting provision with earlier vesting permitted under certain conditions, such as upon a
change of control of the company. The determination of the fair value of these awards takes into consideration
the likelihood of achievement of the market condition. The compensation expense for the PRUs is initially based
on the probability of achieving the target level of the company-specific performance condition, and will be
adjusted for subsequent changes in the estimated or actual outcome of this performance condition.
Assumed Clearwell stock options
In connection with our acquisition of Clearwell, we assumed all unexercised, outstanding options to
purchase Clearwell common stock. Each unexercised, outstanding option assumed was converted into an option
to purchase our common stock after applying the exchange ratio of 0.40906 shares of our common stock for each
share of Clearwell common stock which resulted in an allocation of approximately 1 million shares of our
common stock to the assumed options.
Furthermore, all shares obtained upon early exercise of unvested Clearwell options were converted into the
right to receive a cash consideration of $7.65 per share upon vesting. The total value of the early exercised,
unvested Clearwell shares on the date of acquisition was approximately $4 million, assuming no forfeitures.
Other stock option plans
Options remain outstanding under several other stock option plans, including the 1996 Plan, and various
plans assumed in connection with acquisitions. No further options may be granted under any of these plans.
Valuation of stock-based awards
The fair value of share-based awards for stock options was estimated using the Black-Scholes option pricing
model. The fair value of PRUs was estimated using a Monte Carlo simulation model. The fair value of each
restricted stock grant is equal to the market value of our common stock on the date of grant.
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