Zoran eschews options for restricted stock in proposed exchange - 27 Apr 2009

Zoran eschews options for restricted stock in proposed exchange

Posted by Jack Davis on April 27th, 2009 at 6:14 pm | Categorized as Zoran | Tagged as Option exchange, Zoran

Sunnyvale
chip-maker Zoran’s board of directors last week approved a plan to
exchange shares held in underwater options for a lesser number of
shares of restricted stock, according to a preliminary proxy filing the company made today in advance of its June 26 annual meeting, where it will ask shareholders to approve the plan.

“Like many semiconductor companies, our stock price has experienced a
significant decline driven primarily by the impact the worldwide
economic downturn has had on our business,” says the company in its
presentation of the proposal “As a result, many of our employees

hold options with exercise prices significantly higher than the current market price of our common stock.”

Of the 8.4 million shares covered by all the outstanding options at
Zoran as of April 23, 2.1 million had exercise prices ranging from
$16.22 per share to $29.13 per share, while the closing price of
Zoran’s stock that day was $9.03. “These ‘out-of-the-money’ options are
no longer effective as performance and retention incentives,” the
company argues.

The company is limiting the options that may be exchanged to those that were granted

For more information on Zoran's Option Exchange.

Posted by Dan Walter

Performensation: Equity Compensation for High Performance Companies.