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Technology Stocks : 3DFX -- Ignore unavailable to you. Want to Upgrade?

To: Sun Tzu who wrote (10527)	2/5/1999 3:45:00 PM
From: Michael G. Potter	Read Replies (1) \| Respond to of 16960

From the 10-K. Of course, they're still underwater ... OPTION REPRICINGS In October 1998, the 3Dfx Board determined that the purposes of the 1995 Employee Stock Plan and the 1997 Supplemental Plan were not being adequately achieved with respect to those employees holding options with exercise prices greater than the then-current market value of 3Dfx's Common Stock and that it was in the best interests of 3Dfx and 3Dfx's shareholders that 3Dfx retain and motivate such employees. The 3Dfx Board decided therefore to provide such option holders, excluding executive officers, the opportunity to exchange their options for new ones with exercise prices equal to the then-current market value of 3Dfx's Common Stock. On October 27, 1998, upon approval of the 3Dfx Board, 3Dfx offered certain employees who were holders of outstanding options under the 1995 Employee Stock Plan and 1997 Supplemental Plan with exercise prices in excess of $10.88 per share the opportunity to exchange such options for new stock options with an exercise price of $10.88 per share, the fair market value of 3Dfx's Common Stock at the close of business on that date. Executive officers were not entitled to participate in the October repricing. Subsequently, however, the 3Dfx Board determined that it was necessary, in order to retain and motivate its executive officers, to offer them the opportunity to exchange their options with exercise prices equal to the then-current market value of 3Dfx's Common Stock. The repricing for executive officers occurred on December 3, 1998 and such options were repriced at an exercise price of $13.13. The named executive officers named below participated in the December repricing. In both the October and December Repricings, any option holder accepting such offer was not permitted to exercise the repriced option (including both vested and unvested shares) in the first twelve months following the date of the applicable repricing. A total of 221 employees of 3Dfx were eligible to participate in the October repricing. Those eligible employees' existing options had an average exercise price of $18.07 per share prior to the repricing. Of such eligible employees, 195 participated in the October repricing. All eight executive officers who were eligible to participate in the December repricing did so and those officers' existing options had an average exercise price of $21.31 per share prior to the repricing. 10-YEAR OPTION REPRICINGS LENGTH OF ORIGINAL NUMBER OF MARKET OPTION SECURITIES PRICE OF EXERCISE TERM UNDERLYING STOCK AT PRICE AT NEW REMAINING OPTIONS TIME OF TIME OF EXERCISE AT DATE OF NAME AND REPRICED REPRICING REPRICING PRICE REPRICING PRINCIPAL POSITION DATE (#) ($) ($) ($) (# OF YRS) ------------------ ---------------- ----------- --------- --------- -------- ---------- L. Gregory Ballard......... -- -- -- -- -- -- President, Chief Executive Officer and Director Karl Chicca................ December 3, 1998 10,000 13.13 24.50 13.13 9.2 Vice President, Operations Michael Howse.............. December 3, 1998 25,000 13.13 26.75 13.13 9.4 Vice President, Corporate Marketing and Business Development Darlene R. Kindler......... December 3, 1998 40,000 13.13 24.50 13.13 9.2 Vice President, Third Party Janet Leising.............. December 3, 1998 10,000 13.13 24.50 13.13 9.2 Vice President, Engineering December 3, 1998 10,000 13.13 17.13 13.13 9.6 LENGTH OF ORIGINAL NUMBER OF MARKET OPTION SECURITIES PRICE OF EXERCISE TERM UNDERLYING STOCK AT PRICE AT NEW REMAINING OPTIONS TIME OF TIME OF EXERCISE AT DATE OF NAME AND REPRICED REPRICING REPRICING PRICE REPRICING PRINCIPAL POSITION DATE (#) ($) ($) ($) (# OF YRS) ------------------ ---------------- ----------- --------- --------- -------- ---------- Scott D. Sellers........... December 3, 1998 50,000 13.13 15.75 13.13 8.9 Sr. Vice President, Product Development and Director Gary Tarolli............... December 3, 1998 50,000 13.13 15.75 13.13 8.9 Vice President and Chief Technology Officer Jordan G. Watters.......... December 3, 1998 15,000 13.13 17.06 13.13 8.8 Vice President, Worldwide Sales December 3, 1998 20,000 13.13 22.13 13.13 9.2 David Zacarias............. December 3, 1998 100,000 13.13 24.50 13.13 9.2 Vice President, Administration and Chief Financial Officer The 3Dfx Board intends that its compensation program shall be fair and motivating and shall be successful in attracting and retaining qualified employees and in linking compensation directly to 3Dfx's success. The 3Dfx Board and the Compensation Committee intend to review this program on an ongoing basis to evaluate its continued effectiveness. THE COMPENSATION COMMITTEE Alex Leupp James Whims