Stock-Based Compensation Plans

The Company’s equity incentive plans are broad-based, long-term retention programs that cover employees, consultants and non-employee directors of the Company. These plans are intended to attract and retain talented employees, consultants and non-employee directors and to provide such persons with a proprietary interest in the Company.

Stock-Based Compensation

The following table summarizes stock-based compensation expense related to stock awards granted under the Company’s equity incentive plans and rights to acquire stock granted under the Company’s 1990 Employee Qualified Stock Purchase Plan (ESPP):



	Three Months Ended				Nine Months Ended
(In thousands)	December 28, 2013		December 29, 2012		December 28, 2013		December 29, 2012
Stock-based compensation included in:
Cost of revenues	$	1,966	$	1,517	$	5,628	$	4,718
Research and development	11,912		9,654		33,474		27,681
Selling, general and administrative	10,461		8,591		29,251		24,217
	$	24,339	$	19,762	$	68,353	$	56,616

During the first nine months of fiscal 2014 and 2013, the tax benefits realized for the tax deduction from option exercises and other awards credited to additional paid-in capital were $17.0 million and $5.4 million, respectively.

The fair values of stock options and stock purchase plan rights under the Company’s equity incentive plans and ESPP were estimated as of the grant date using the Black-Scholes option pricing model. The Company’s expected stock price volatility assumption for stock options is estimated using implied volatility of the Company’s traded options. The expected life of options granted is based on the historical exercise activity as well as the expected disposition of all options outstanding. The expected life of options granted also considers the actual contractual term. The weighted-average fair value per share of stock options granted during the first nine months of fiscal 2014 and 2013 was $6.06 and $6.20, respectively. No options were granted in the third quarter of fiscal 2014. These fair values per share were estimated at the date of grant using the following weighted-average assumptions:



	Three Months Ended				Nine Months Ended
	December 28, 2013		December 29, 2012		December 28, 2013		December 29, 2012
Expected life of options (years)	—		4.9		4.7		4.9
Expected stock price volatility	—	%	28.0	%	24.0	%	28.0	%
Risk-free interest rate	—	%	0.7	%	0.9	%	0.7	%
Dividend yield	—	%	2.6	%	2.6	%	2.6	%

The estimated fair values of restricted stock unit (RSU) awards were calculated based on the market price of Xilinx common stock on the date of grant, reduced by the present value of dividends expected to be paid on Xilinx common stock prior to vesting. The per share weighted-average fair values of RSUs granted during the third quarter of fiscal 2014 was $42.37 ($31.47 for the third quarter of fiscal 2013), and for the first nine months of fiscal 2014 was $38.13 ($31.15 for the first nine months of fiscal 2013), which were calculated based on estimates at the date of grant using the following weighted-average assumptions:



	Three Months Ended				Nine Months Ended
	December 28, 2013		December 29, 2012		December 28, 2013		December 29, 2012
Risk-free interest rate	0.7	%	0.3	%	0.7	%	0.4	%
Dividend yield	2.2	%	2.6	%	2.5	%	2.7	%

Employee Stock Option Plans

A summary of the Company’s option plans activity and related information is as follows:



	Options Outstanding
(Shares in thousands)	Number of Shares		Weighted-Average Exercise Price Per Share
March 31, 2012	17,788		$	28.32
Granted	92		$	33.83
Exercised	(3,564	)	$	24.68
Forfeited/cancelled/expired	(1,563	)	$	39.54
March 30, 2013	12,753		$	28.01
Granted	5		$	38.99
Exercised	(4,788	)	$	29.31
Forfeited/cancelled/expired	(49	)	$	35.43
December 28, 2013	7,921		$	27.18
Options exercisable at:
December 28, 2013	7,423		$	27.04
March 30, 2013	11,639		$	28.07

The types of awards allowed under the 2007 Equity Incentive Plan (2007 Equity Plan) include incentive stock options, non-qualified stock options, RSUs, restricted stock and stock appreciation rights. To date, the Company has issued a mix of non-qualified stock options and RSUs under the 2007 Equity Plan. On August 14, 2013, the stockholders approved an amendment to increase the authorized number of shares reserved for issuance under the 2007 Equity Plan by 2.0 million shares and to extend the term of the 2007 Equity Plan to December 31, 2023. As of December 28, 2013, 15.5 million shares remained available for grant under the 2007 Equity Plan.

The total pre-tax intrinsic value of options exercised during the three and nine months ended December 28, 2013 was $5.5 million and $70.7 million, respectively. The total pre-tax intrinsic value of options exercised during the three months and nine months ended December 29, 2012 was $8.6 million and $20.3 million, respectively.

This intrinsic value represents the difference between the exercise price and the fair market value of the Company’s common stock on the date of exercise.

RSU Awards

A summary of the Company’s RSU activity and related information is as follows:



	RSUs Outstanding
(Shares in thousands)	Number of Shares		Weighted-Average Grant-Date Fair Value Per Share
March 31, 2012	5,239		$	29.01
Granted	3,018		$	31.58
Vested	(1,778	)	$	27.01
Cancelled	(483	)	$	29.69
March 30, 2013	5,996		$	30.83
Granted	2,760		$	37.97
Vested	(1,698	)	$	29.14
Cancelled	(243	)	$	31.91
December 28, 2013	6,815		$	34.10

Employee Stock Purchase Plan

Under the ESPP, shares are only issued during the second and fourth quarters of each fiscal year. Employees purchased 529 thousand shares for $14.6 million during the second quarter of fiscal 2014 and 521 thousand shares for $14.1 million in the second quarter of fiscal 2013. The per-share weighted-average fair value of stock purchase rights granted under the ESPP during the second quarter of fiscal 2014 and 2013 was $11.24 and $8.53, respectively. The fair values of stock purchase plan rights granted in the second quarter of fiscal 2014 and 2013 were estimated at the date of grant using the following assumptions:



	2014		2013
Expected life of options (years)	1.25		1.25
Expected stock price volatility	23.0	%	29.0	%
Risk-free interest rate	0.2	%	0.2	%
Dividend yield	2.1	%	2.7	%

The next scheduled purchase under the ESPP is in the fourth quarter of fiscal 2014. On August 14, 2013, the stockholders approved an amendment to increase the authorized number of shares reserved for issuance under the ESPP by 2.0 million shares. As of December 28, 2013, 10.4 million shares were available for future issuance out of 50.5 million shares authorized.