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76 SPECTRUM BRANDS | 2006 ANNUAL REPORT
The following table summarizes the stock option transactions:
2006 2005 2004
Weighted- Weighted- Weighted-
Average Aggregate Average Average
Exercise Intrinsic Exercise Exercise
Options Price Value Options Price Options Price
Outstanding, beginning of period 1,988 $14.64 $16,938 3,300 $14.56 4,923 $13.55
Granted – – – – – 294 16.16
Exercised (28) 13.08 4 (1,276) 14.44 (1,783) 11.85
Forfeited (49) 15.46 – (36) 14.03 (134) 17.04
Outstanding, end of period 1,911 $14.65 $ – 1,988 $14.64 3,300 $14.56
Options exercisable, end of period 1,659 $14.74 $ – 1,467 $14.97 1,995 $15.09
The following table summarizes information about options outstanding and options outstanding and exercisable as of September 30, 2006:
Options Outstanding Options Outstanding and Exercisable
Weighted- Weighted- Weighted-
Average Average Average
Range of Number of Remaining Exercise Number of Exercise
Exercise Prices Shares Contractual Life Price Shares Price
$4.39 149 1.00 years $ 4.39 149 $ 4.39
$11.32 – $15.00 1,276 5.66 13.49 1,045 13.49
$16.19 – $21.50 210 2.00 18.69 201 18.69
$21.63 – $28.70 276 2.80 22.52 264 22.52
1,911 4.48 $14.65 1,659 $14.74
2006 Form 10-K Annual Report
Spectrum Brands, Inc.
(x) Restructuring and Related Charges
The costs of plans to (i) exit an activity of an acquired company,
(ii) involuntarily terminate employees of an acquired company, or
(iii) relocate employees of an acquired company are measured and
recorded in accordance with the provisions of EITF 95-3,
“Recognition of Liabilities in Connection with a Purchase Business
Combination.” Under EITF 95-3, if certain conditions are met, such
costs are recognized as a liability assumed as of the consummation
date of the purchase business combination and included in the allo-
cation of the acquisition cost. Costs related to activities or employ-
ees of the acquired company that do not meet the conditions
prescribed in EITF 95-3 are treated as restructuring and related
charges and expensed as incurred.
Restructuring and related charges are recognized and mea-
sured according to the provisions of SFAS 146, “Accounting for
Costs Associated with Exit or Disposal Activities.” Under SFAS 146,
restructuring charges include, but are not limited to, termination
and related costs consisting primarily of severance costs and
retention bonuses, and contract termination costs consisting pri-
marily of lease termination costs. Related charges, as defi ned by
the Company, include, but are not limited to, other costs directly
associated with exit and integration activities, including impair-
ment of property and other assets, departmental costs of full-time
incremental integration employees, and any other items related to
the exit or integration activities. Costs for such activities are esti-
mated by management after evaluating detailed analyses of the cost
to be incurred. See Note 16, Restructuring and Related Charges,
for a more complete discussion of recent restructuring initiatives
and related costs.
(y) Adoption of New Accounting Pronouncements
In September 2006, the Financial Accounting Standards Board
(“FASB”) issued FASB Statement No. 158, “Employers’ Accounting
for Defi ned Benefi t Pension and Other Postretirement Plans—An
Amendment of FASB Statements No. 87, 88, 106, and 132R,” (“SFAS
158”). This new standard requires an employer to: (i) recognize
in its statement of fi nancial position an asset for a plan’s over-
funded status or a liability for a plan’s underfunded status; (ii)
measure a plan’s assets and its obligations that determine its
funded status as of the end of the employer’s fi scal year (with lim-
ited exceptions); and (iii) recognize changes in the funded status
of a defi ned benefi t postretirement plan in the year in which the
changes occur. Those changes will be reported in comprehensive
income of a business entity and in changes in net assets of a not-
for-profi t organization. SFAS 158 applies to plan sponsors that
are public and private companies and nongovernmental not-for-
profi t organizations. The requirement to recognize the funded
status of a benefi t plan and the disclosure requirements are effec-
tive as of the end of the fi scal year ending after December 15,
2006, for entities with publicly traded equity securities, and at
the end of a company’s fi rst fi scal year ending after June 15, 2007,
for all other entities. The requirement to measure plan assets and
benefi t obligations as of the date of the employer’s fi scal year-end