Estee Lauder 2003 Annual Report Download - page 78

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THEEST{E LAUDER COMPANIES INC.77
Asummary of the Company’s stock option programs as of June 30, 2003, 2002 and 2001, and changes during the years
then ended, is presented below:
2003 2002 2001
Weighted- Weighted- Weighted-
Average Average Average
Exercise Exercise Exercise
Shares Price Shares Price Shares Price
(Shares in thousands)
Outstanding at beginning of year 24,843.5 $35.10 23,393.2 $34.55 21,914.1 $33.14
Granted at fair value 6,651.2 32.02 2,175.3 39.07 2,709.5 42.80
Exercised (1,094.0) 15.16 (435.4) 17.85 (806.0) 16.50
Cancelled or Expired (858.5) 43.10 (289.6) 46.38 (424.4) 48.19
Outstanding at end of year 29,542.2 34.93 24,843.5 35.10 23,393.2 34.55
Options exercisable at year-end 16,425.6 32.31 13,149.5 27.59 8,497.6 21.69
Weighted-average fair value of
options granted during the year $12.35 $16.02 $17.01
Summarized information about the Company’s stock options outstanding and exercisable at June 30, 2003 is as follows:
Exercise Price RangeOptions
(a)
Average Life
(b)
Average Price
(c)
Options
(a)
Average Price
(c)
$ 3.10 14.1 4.3 $ 3.10 14.1 $ 3.10
$13.00 to $20.813 2,668.8 2.4 13.08 2,668.8 13.08
$21.313 to $30.52 5,960.1 4.1 23.88 5,478.9 23.37
$31.875 to $47.625 14,541.2 7.6 36.14 4,371.3 37.30
$49.75 to $53.50 6,358.0 6.1 51.77 3,892.5 52.14
$ 3.10 to $53.50 29,542.2 34.93 16,425.6 32.31
(a) Shares in thousands.
(b) Weighted average contractual life remaining in years.
(c) Weighted average exercise price.
Subsequent to June 30, 2003, the Company granted options under the terms of the Plans described above to purchase an
additional 2,211,200 of the Company’s Class A Common Stock with an exercise price equal to fair market value on the
date of grant. In addition, subsequent to June 30, 2003, the Company granted approximately 58,500 share units to a key
executive pursuant to the terms of the Fiscal 2002 Share Incentive Plan.
ExercisableOutstanding
Executive Employment Agreements
The executive employment agreements provide for the
issuance of 11,400,000 shares to be awarded in the form
of stock options and other stock awards to certain key
executives. The Company has reserved 661,600 shares of
its Class A Common Stock pursuant to such agreements
as of June 30, 2003. In accordance with such employment
agreements approximately 1,400 share units were granted
in fiscal 2003 and 900 share units were granted in fiscal
2002 and 2001. The reserve is solely for dividend equiva-
lents on units granted pursuant to one of the agreements.
Most of the stock options granted pursuant to the agree-
ments are exercisable and expire at various times from
November 2005 through July 2009. The share units will
be paid out in shares of Class A Common Stock at a time
to be determined by the Company, but no later than
90 days subsequent to the termination of employment of
the executive.