Adobe looks at option exchange

Software maker Adobe Systems wants to let employees exchange overvalued stock options. In a proxy statement filed with the Securities and Exchange Commission, the company said it will seek shareholder approval at its annual meeting April 9 for a plan that would allow workers to exchange options priced at $40 a share and above for an equal or smaller number of shares at a new price based on Adobe's closing price the date the new options are granted. The exchange ratio would range from 1-to-1 to 2-to-1, depending on the price of the original shares.

Adobe shares, which peaked around $87 in 2000, closed at $32.18 Monday. About 2,800 employees with options representing approximately 11.9 million shares would be eligible for the exchange, Adobe said in the filing. Adobe did not estimate the anticipated cost of the exchange.