WeightWatchers 2004 Annual Report Download - page 85

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WEIGHT WATCHERS INTERNATIONAL, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
10. Stock Plans (Continued)
A summary of the stock option activity under the WeightWatchers.com Stock Incentive Plan is as
follows:
January 1, 2005 January 3, 2004 December 28, 2002
Weighted Weighted Weighted
Number of average Number of average Number of average
Shares exercise price Shares exercise price Shares exercise price
Options outstanding, beginning of
year ....................... 151 152 $0.50 164 $0.50
Granted .................... 23 $0.50 — —
Exercised ................... — $7.14 — —
Cancelled ................... (23) $0.50 (1) $0.50 (12) $0.50
Options outstanding, end of year . . . 151 $1.50 151 $0.50 152 $0.50
Options exercisable, end of year .... 141 $1.14 133 $0.50 115 $0.50
Options available for grant, end of
year ....................... 249 249 248
Weighted average fair value of
options granted during the year(1) . $4.70 — —
(1) The fair value of each option is estimated on the date of grant using the Black-Scholes option
pricing model with the following weighted average assumptions: (a) the exercise price of the
options equals the fair value of the underlying stock on the date of grant; (b) an expected term of
7 years; (c) dividend yield of 0%; (d) volatility of 64% and (e) a risk-free interest rate of 4.1%.
The following table summarizes information about stock options outstanding under the
WeightWatchers.com Stock Incentive Plan at January 1, 2005 by range of exercise price:
Options Outstanding Options Exercisable
Weighted
Average Weighted Weighted
Range of Remaining Average Average
Exercise Shares Contractual Exercise Shares Exercise
Prices Outstanding Life (Yrs.) Price Exercisable Price
$0.50 128 5.3 $0.50 128 $0.50
$7.14 23 9.6 $7.14 13 $7.14
151 141
WeightWatchers.com Stock Option Plan
WeightWatchers.com may grant incentive stock options and/or nonqualified stock options on its
common stock to its employees, consultants and certain non-employees under the terms of its stock
option plans. WeightWatchers.com is authorized to grant options to purchase a total of 3,400 shares of
its common stock under these plans. At January 1, 2005, there were options to purchase 2,806 shares of
WeightWatchers.com common stock outstanding.
F-23