Albertsons 2005 Annual Report Download - page 75

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SUPERVALU INC. and Subsidiaries
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The following table summarizes stock option information at year-end 2005:
Options Outstanding Options Exercisable
Range of Exercise Price
Number of
Options
Weighted-
Average
Remaining
Contractual Life
Weighted-
Average
Exercise
Price
Number of
Options
Weighted-
Average
Exercise
Price
$12.25 to $15.61 1,490,281 5.22 years $14.72 1,350,681 $14.67
15.69 to 15.90 1,516,845 7.59 15.89 437,862 15.87
16.08 to 22.25 1,535,462 5.10 19.83 1,323,262 20.01
22.44 to 27.51 1,177,336 3.51 23.69 1,066,127 23.60
27.52 to 29.21 1,878,808 6.41 28.12 1,195,863 28.20
29.29 to 29.90 2,010,702 9.02 29.89 410,309 29.88
29.96 to 34.46 1,694,164 5.29 31.05 1,370,353 30.99
$12.25 to $34.46 11,303,598 6.23 23.88 7,154,457 23.32
Option shares available for grant were 3.2 million and 6.2 million at February 26, 2005 and February 28,
2004, respectively. As of February 26, 2005, the company has reserved 14.5 million shares, in aggregate, for the
plans.
As of February 26, 2005, limited stock appreciation rights have been granted and are outstanding under the
1989 stock appreciation rights plan and the 1993 stock plan. Such rights relate to options granted to purchase
253,000 shares of common stock and are exercisable only upon a “change in control.” See the Shareholder Rights
Plan note in the Notes to the Consolidated Financial Statements.
In addition to the stock plans described above, the company incurs expenses under long-term incentive and
restricted stock plans at the discretion of the Board of Directors. Compensation expense under these plans was
$12.2 million, $2.2 million and $1.7 million for fiscal 2005, 2004 and 2003, respectively.
See Summary of Significant Accounting Policies in the Notes to Consolidated Financial Statements for the
impact of stock based compensation on pro forma net earnings and earnings per common share.
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 and results:
2005 2004 2003
Dividend yield 2.00% 2.00% 2.00%
Risk free interest rate 3.07% 2.10% 2.86%
Expected life 4.5 years 4.5 years 4.5 years
Expected volatility 31.79% 32.04% 34.66%
Estimated fair value of options granted per share $7.80 $4.25 $7.77
F-29