Grading watches is often used as a way to help determine antique watch 
value, and below is a reference guide that will provide the knowledge needed for accurately evaluating and judging quality and condition of watches as well as determining value.

Pristine Mint (G-10) - watch grade 100%:
New Old Stock. Absolutely factory new, sealed in a factory box - wax paper still intact and all tags and papers, etc. The pristine mint grade will command significant premiums. (A select group of watches may be assigned to a "rarity grade," which is historical or technically important, such as early horological examples.)

Mint Plus (G-9) - watch grade 99%:
Still in factory box. (exceptional, perfect)

Mint (G-8) - watch grade 97%:
Same as factory new but with very little use - perhaps opened, used briefly, stored away, may still be in box. No faint scratches and no trace of a screwdriver mark - original in every way in regards to the crystal, hands, dial, case, movement. (trade show)

Near Mint (G-7) - watch grade 93%:
Completely original in every way; however, faint marks seen with a loop 
only; expertly repaired; movement may have been cleaned and oiled. 
(excellent)

Extra Fine (G-6) - watch grade 87%:
May or may not be in a factory box; looks as though the watch was used 
very little; original case, hands, dial and movement. If watch was repaired, all original replacement parts have been used. Faint case scratches are evident but hard to detect with the eye. No dents or hairlines on the dial are detectable.

Fine (G-5) - watch grade 80%:
May have new hands and crystal, but with original case, dial and movement. Faint hairlines but no chips on dial; no large scratches and no brass seen on case; slight stain on the movement; movement must be sharp with only minor scratches.

Average to Good (G-4) - watch grade 75%:
In the original case, dial and movement. Movement may have had a part 
replaced, but the part is near to the original. No brass showing through 
on a gold-filled case; no rust or chips in the dial; hairlines in the dial that 
are hard to see. Marks are difficult to detect. (usually wholesale price; 
what a dealer may pay)

Fair (G-3) - watch grade 60%:
Hairlines in dial and small clips; small amount of brass visible on a gold-filled case; some rust showing on the movement; small dent in the case and/or wear in case dial and movement. Appears well-used and may not have the original case or dial.

Poor (G2) - watch grade 30%:
Watch not working; needs new dial; case is well worn; many dents; hands may be gone; replacement crystal may be needed.

Scrap (G-1) - watch grade 15%:
Movement is not working; bad dial; rusty movement; badly worn and brass showing; case may be missing; not original parts; no crystal or hands. (useful only for parts)


- from Collecting Watches by Sughart and Hanson