2K Sports 2009 Annual Report Download - page 105

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Stock Options
As of October 31, 2009 and 2008, there were outstanding stock options granted under our stock option
plans to purchase in the aggregate approximately 3,803,000 and 4,347,000 shares of our common stock,
respectively, vesting at various times from 2009 to 2010 and expiring at various times from 2009 to 2017.
Options granted generally vest over a period of three to four years and expire within a period of five to ten
years.
Pursuant to the Management Agreement, in August 2007, we issued stock options to ZelnickMedia to
acquire 2,009,075 shares of our common stock at an exercise price of $14.74 per share, which vest over
36 months and expire 10 years from the date of grant. Each month, we remeasure the fair value of the
unvested portion of such options and record compensation expense for the difference between total earned
compensation at the end of the period, and total earned compensation at the beginning of the period. As a
result, changes in the price of our common stock impacts compensation expense or benefit recognized
from period to period. For the years ended October 31, 2009, 2008 and 2007 we recorded $3,968, $11,254
and $1,283 respectively, of stock-based compensation (a component of general and administrative
expenses) related to this option grant.
The following table summarizes the activity in options awarded to employees and ZelnickMedia under our
option plans and also includes non-plan options:
2009 2008 2007
Weighted Weighted Weighted
Average Average Average
Exercise Exercise Exercise
(options in thousands) Options Price Options Price Options Price
Outstanding at beginning of year 4,347 $18.92 5,914 $19.72 5,802 $20.70
Granted ——— — 2,465 15.53
Exercised (2) 10.42 (1,236) 21.00 (679) 15.39
Forfeited (542) 22.24 (331) 19.36 (1,674) 18.70
Outstanding at end of year 3,803 $18.45 4,347 $18.92 5,914 $19.72
Exercisable at year-end 3,133 $19.08 2,588 $20.84 2,750 $22.06
Weighted average fair value of options
granted during the year $— $ — $11.45
Remaining weighted average contractual life
of options exercisable (years) 4.1 3.8 2.2
The total estimated fair value of options vested during fiscal years 2009, 2008 and 2007 was $7,848; $19,376
and $13,777, respectively.
The following summarizes information about stock options outstanding and exercisable at October 31,
2009 (options in thousands):
Options Outstanding Options Exercisable
Weighted
Average Weighted Weighted
Number of Remaining Average Number of Average
Exercise Price Ranges Options Contractual Exercise Options Exercise
From To Outstanding Life Price Exercisable Price
$10.42 $15.39 2,128 7.5 $14.54 1,560 $14.47
15.50 20.68 322 1.9 18.86 253 18.69
20.70 24.51 435 0.8 22.59 402 22.72
25.10 26.59 918 0.6 25.42 918 25.42
3,803 10.8 18.45 3,133 19.08
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