Black & Decker 2010 Annual Report Download - page 106

The following weighted-average stock options, warrants and Equity Purchase Contracts to purchase the
Company’s common stock were not included in the computation of diluted shares outstanding because the
effect would be anti-dilutive (in thousands):
2010 2009 2008
Number of stock options ................................... 2,760 3,519 2,101
Number of stock warrants .................................. 4,939 4,939 5,069
Number of shares related to May 2010 equity purchase contracts ..... 2,210 5,893 6,035
Number of shares related to the convertible preferred units ......... 1,054 ——
The Company has warrants outstanding which entitle the holder to purchase up to 4,938,624 shares of its
common stock with a strike price of approximately $86.50. These warrants are anti-dilutive since the strike
price is greater than the market price of the Company’s common stock.
The Convertible Notes outstanding, described more fully in Note H, Long-Term Debt and Financing
Arrangements, had a very minor dilutive impact during the year.
As of January 1, 2011 there were no shares related to the Convertible Preferred Units included in the
calculation of diluted earnings per share because the effect of the conversion option was not dilutive. These
Convertible Preferred Units, as well as the equity purchase contracts and convertible note hedge, are discussed
more fully in Note H, Long-Term Debt and Financing Arrangements.
COMMON STOCK SHARE ACTIVITY — Common stock share activity for 2010, 2009 and 2008 was as
follows:
2010 2009 2008
Outstanding, beginning of year .................... 80,478,624 78,876,034 80,378,787
Shares issued as part of the merger ................. 78,497,261 ——
Shares issued from Equity Units Offering ............ 5,180,776 ——
Issued from treasury ............................ 2,298,603 2,178,203 737,698
Returned to treasury ............................ (107,834) (575,613) (2,240,451)
Outstanding, end of year ........................ 166,347,430 80,478,624 78,876,034
In 2009, in addition to the common stock share activity described in the Stock-Based Compensation Plans and
Equity Option sections of this footnote, the Company issued 242,653 shares of common stock from treasury
and received cash proceeds of $9.5 million during the year.
COMMON STOCK RESERVED — Common stock shares reserved for issuance under various employee and
director stock plans at January 1, 2011 and January 2, 2010 are as follows:
2010 2009
Employee stock purchase plan .................................. 2,956,667 3,100,855
Other stock-based compensation plans ............................ 5,035,575 4,086,625
Total shares reserved ......................................... 7,992,242 7,187,480
PREFERRED STOCK PURCHASE RIGHTS — Each outstanding share of common stock has a one share
purchase right. Each purchase right may be exercised to purchase one two-hundredth of a share of Series A
Junior Participating Preferred Stock at an exercise price of $220.00, subject to adjustment. The rights, which
do not have voting rights, expire on March 10, 2016, and may be redeemed by the Company at a price of
$0.01 per right at any time prior to the tenth day following the public announcement that a person has
acquired beneficial ownership of 15% or more of the outstanding shares of common stock. In the event that
the Company is acquired in a merger or other business combination transaction, provision shall be made so
that each holder of a right (other than a holder who is a 14.9%-or-more shareowner) shall have the right to
receive, upon exercise thereof, that number of shares of common stock of the surviving Company having a
market value equal to two times the exercise price of the right. Similarly, if anyone becomes the beneficial
owner of more than 15% of the then outstanding shares of common stock (except pursuant to an offer for all
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