EA gives workers options on their options

Since its high-water mark for July of 2005, Electronic Arts stock has lost about a third of its value. As a result, one of its employee perks, stock options, has become less desirable considering that the workers are in some cases retaining the right to purchase stock in the company at more than 115 percent of what it trades for in the open market.

Now, in an attempt to better its employee incentive program and keep more people with the company, EA has announced its intent to convert those stock options into restricted stock rights, at a ratio of 3-to-1 or 4-to-1, depending on the options. Employees would have to remain with the company for at least two years and at most four years before the restricted shares become eligible for vesting.

Before it can go into effect, the program must be approved by stockholders at the company's annual meeting July 27. The company's nine board of director spots will also be voted on at the meeting. EA is advising its shareholders to reelect eight of the existing boardmembers, and to vote former Nokia executive vice president and chief financial officer Richard A. Simonson to the soon-to-be vacated ninth seat.

EA is also making a change to its incentive program that doesn't require shareholder approval. The company plans to dole out stock options for more than 2.2 million shares, as well as 600,000 restricted stock units to "a select group of key employees" that includes its executives.