THQ 2005 Annual Report Download - page 99

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76
The following table summarizes information about stock options exercisable at March 31, 2005:
Shares Weighted
Range of
Exercise Price
Exercisable at
March 31, 2005
Average Exercise
Price
$0.49 -$10.25............................................ 176,410$2.35
$11.33 - $16.70 ............................................ 649,232$ 1 3.90
$16.82 - $22.08 ............................................ 947,516 $ 20.03
$22.09 - $30.04 ............................................ 1,154,914$ 2 8.45
$30.93 - $38.53 ............................................ 68,067 $ 34.35
2,996,139 $ 21.81
12.Capital Stock Transactions
On September 10, 2002, we announced that our Board of Directors authorized the repurchase of up to
$25.0 million of our common stock from time to time on the open market or in private transactions. On
November 21, 2002, we announced that our Board of Directors authorized the repurchase of up to an
additional $25.0 million of our common stock from time to time on the open market or in private
transactions. On February 5, 2004, we announced that our Board of Directors authorized the repurchase of
an additional $25.0 million of our common stock, bringing the total authorized repurchase amount to$75.0
million. As of March 31, 2005, we have repurchased 3,449,000 shares of our common stock for
approximately $52.9 million, leaving $22.1 million available for future repurchases. There is no expiration
date for the authorized repurchases.
During the fiscal year ended March 31, 2005, we finalized the terms of warrants we committed to issue in
connection with a licensing agreement under which we had previously shipped product. We issued these
warrants to purchase 160,000 shares of common stock at $20.23 per share having an estimated fair value of
$2.0 million. Prior to finalizing the warrants terms, we estimated the fair value of the warrants commitment
based upon the terms subject to our then ongoing negotiationswith the licensor, and amortized this
estimated value to license amortization and royalties in accordance with our accounting policy described in
Note 5 over the periods during which we had been shipping product under the license. The fair value of the
finalized warrants was determined using the Black-Scholes option pricing model with the following
assumptions: an anticipated volatility of 67.2%, a weighted average risk-free interest rate of 2.9%, and a
term of 6 years. The fair value of the warrants are included in licenses in the consolidated balance sheet.
The fair value of the finalized warrants were less than previously estimated and as a result we recorded a
reduction in license amortization and royalties expense in the consolidated statement of operations for the
fiscal year ended March 31, 2005, of approximately $1.7million. The warrants expire December 31, 2009.
As of March 31, 2005, these warrants had not been exercised and are all outstanding.
In connection with a licensing agreement, in September 2003, we issued a warrant to purchase 100,000
shares of common stock at $15.68 per share having an estimated fair value of $1.4 million. The estimated
fair value was determined using the Black-Scholes option pricing model with the following assumptions: an
anticipated volatility of 87%, a weighted average risk-free interest rate of 4.87%, and a term of 10 years.
The fair value of the warrant is included in licenses in the consolidated balance sheet. The warrant expires
December 31, 2013. As of March 31, 2005, this warrant has not been exercised and is outstanding.
On July 1, 2002, we issued approximately 167,000 shares of common stock as part of the purchase price of
ValuSoft.
In connection with obtaining a license agreement, in February 2002, we issued a warrant to purchase
75,000 shares of common stock at $29.13 per share having a fair value of $1.2 million at the time of
issuance. The estimated fair value was determined using the Black-Scholes option pricing model with the
following assumptions: an anticipated volatility of 71%, a weighted average risk-free interest rate of 4.38%,