In addition to the link
@bruinsrme posted about removing the Apple activation lock. If you don't properly remove the lock than no one else can reuse your watch as it will remain "iCloud" lock to your account.
You should follow the normal process to "un pair" your watch from your iPhone, during those steps you will see the option to Erase All Contents and Settings from your watch.
You will also need to contact AT&T to actually have the $10 Unlimited Wearable plan removed from your billing account. It is a manual step that can't be done on your watch or iPhone.
Dave