OfficeMax 2008 Annual Report Download - page 88

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employment. There were 8,008 and 9,377 stock units allocated to the accounts of these executive
officers at December 27, 2008 and December 29, 2007, respectively. As a result of an amendment
to the plan, no additional deferrals can be allocated to the stock unit accounts.
Stock Options
In addition to the 2003 DSCP and the 2003 Plan discussed above, the Company has the
following shareholder-approved stock option plans: the Key Executive Stock Option Plan
(‘‘KESOP’’), the Director Stock Option Plan (‘‘DSOP’’) and the Director Stock Compensation Plan
(‘‘DSCP’’). No further grants will be made under the KESOP, DSOP or DSCP.
The KESOP provided for the grant of options to purchase shares of common stock to key
employees of the Company. The exercise price of awards under the KESOP was equal to the fair
market value of the Company’s common stock on the date the options were granted. Options
granted under the KESOP expire, at the latest, ten years and one day following the grant date.
The DSOP, which was available only to nonemployee directors, provided for annual grants of
options. The exercise price of awards under the DSOP was equal to the fair market value of the
Company’s common stock on the date the options were granted. The options granted under the
DSOP expire upon the earlier of three years after the director ceases to be a director or ten years
after the grant date.
Under the KESOP and DSOP, options may not, except under unusual circumstances, be
exercised until one year following the grant date. Under the 2003 DSCP, options may be exercised
six months after the grant date.
A summary of stock option activity for the years ended December 27, 2008, December 29,
2007 and December 30, 2006 is presented in the table below:
2008 2007 2006
Wtd. Avg. Wtd. Avg. Wtd. Avg.
Shares Ex. Price Shares Ex. Price Shares Ex. Price
Balance at beginning
of year .......... 1,596,295 $31.84 1,753,188 $31.81 5,759,545 $32.39
Options granted ..... — — 35,000 31.39 — —
Options exercised .... — — (187,843) 31.49 (3,993,857) 32.62
Options forfeited and
expired .......... (100,500) 30.08 (4,050) 32.88 (12,500) 37.57
Balance at end of year 1,495,795 $31.95 1,596,295 $31.84 1,753,188 $31.81
Exercisable at end of
year ............ 1,400,462 1,409,896 1,522,390
Weighted average fair
value of options
granted (Black-
Scholes) ......... — $ 7.95 —
84