Hasbro 2009 Annual Report Download - page 80

Information with respect to stock options for the three years ended December 27, 2009 is as follows:
2009 2008 2007
Outstanding at beginning of year ............................ 11,651 14,495 17,309
Granted ............................................. 2,955 3,177 2,243
Exercised ........................................... (476) (5,753) (4,586)
Expired or canceled .................................... (783) (268) (471)
Outstanding at end of year................................. 13,347 11,651 14,495
Exercisable at end of year ................................. 7,839 6,345 9,731
Weighted average exercise price:
Granted ............................................. $ 22.73 27.10 32.42
Exercised ........................................... $ 19.35 21.02 18.04
Expired or canceled .................................... $ 31.53 27.49 26.60
Outstanding at end of year ............................... $ 23.23 23.76 22.01
Exercisable at end of year ............................... $ 21.70 21.01 20.48
With respect to the 13,347 outstanding options and 7,839 options exercisable at December 27, 2009, the
weighted average remaining contractual life of these options was 4.55 years and 3.73 years, respectively. The
aggregate intrinsic value of the options outstanding and exercisable at December 27, 2009 was $119,747 and
$82,373, respectively.
The Company uses the Black-Scholes valuation model in determining the fair value of stock options. The
weighted average fair value of options granted in fiscal 2009, 2008 and 2007 was $5.16, $4.46 and $7.39,
respectively. The fair value of each option grant is estimated on the date of grant using the Black-Scholes
option pricing model with the following weighted average assumptions used for grants in the fiscal years
2009, 2008 and 2007:
2009 2008 2007
Risk-free interest rate .................................... 1.87% 2.71% 4.79%
Expected dividend yield .................................. 3.52% 2.95% 1.97%
Expected volatility ...................................... 36% 22% 22%
Expected option life ..................................... 4years 5 years 5 years
The intrinsic values, which represent the difference between the fair market value on the date of exercise
and the exercise price of the option, of the options exercised in fiscal 2009, 2008 and 2007 were $4,044,
$83,747 and $54,629, respectively.
At December 27, 2009, the amount of total unrecognized compensation cost related to stock options was
$17,343 and the weighted average period over which this will be expensed is 23 months.
In 2009, 2008 and 2007, the Company granted 60, 36 and 31 shares of common stock, respectively, to its
non-employee members of its Board of Directors. Of these shares, the receipt of 51 shares from the 2009
grant, 30 shares from the 2008 grant and 19 shares from the 2007 grant has been deferred to the date upon
which the respective director ceases to be a member of the Company’s Board of Directors. These awards were
valued at the market value of the underlying common stock at the date of grant and vested upon grant. In
connection with these grants, compensation cost of $1,365, $1,260 and $990 was recorded in selling,
distribution and administration expense in 2009, 2008 and 2007, respectively.
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HASBRO, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements — (Continued)
(Thousands of Dollars and Shares Except Per Share Data)