Canon 2008 Annual Report Download - page 90

Download and view the complete annual report

Please find page 90 of the 2008 Canon annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 102

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102

88
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
CANON INC. AND SUBSIDIARIES
Thousands of U.S. dollars
Be
f
ore-tax
a
moun
t
T
ax
(
expense
)
o
r bene
fi
t
N
et-o
f
-ta
x
a
moun
t
2008:
Forei
g
n currenc
y
translation ad
j
ustment
s
$ (2,908,318) $ 64,758 $ (2,843,560)
Net unrea
l
ize
d
gains an
d
l
osses on securities
:
A
mount arising
d
uring t
h
e yea
r
(175,351) 71,780 (103,571)
R
eclassifi cation ad
j
ustments for
g
ains and losses realized in net income 81,033 (34,077) 46,956
Net c
h
an
g
e
d
urin
g
t
h
e
y
ear (94,318) 37,703 (56,615)
Net gains an
d
l
osses on
d
erivative instruments
:
A
mount arisin
g
durin
g
the
y
ea
r
254,187 (101,627) 152,560
R
eclassi
fi
cation adjustments
f
or gains and losses realized in net income (211,308) 84,484 (126,824)
Net c
h
ange
d
uring t
h
e year 42,879 (17,143) 25,736
P
ension liabilit
y
ad
j
ustments
:
A
mount arisin
g
d
urin
g
t
h
e
y
ea
r
(1,175,132) 479,066 (696,066)
R
eclassi
fi
cation adjustments
f
or gains and losses realized in net income (50,066) 21,780 (28,286)
Net chan
g
e durin
g
the
y
ear (1,225,198) 500,846 (724,352)
O
ther com
p
rehensive income (loss) $ (4,184,955) $ 586,164 $ (3,598,791)
On May 1, 2008, based on the approval of the stockholders,
the Company granted stock options to its directors, executive
o
ffi
cers and certain emplo
y
ees to acquire 592,000 shares o
f
co
mm
o
n
stock.
These option awards vest after two years of continuous
service beginning on the grant date and have a four year con
-
tractual term. The
g
rant date
f
air value o
f
each option
g
ranted
was ¥1,247 (
$
13.70)
.
The compensation cost recognized for these stock options for
the year ended December 31, 2008 was ¥246 million ($2,703
thousand
)
and is included in selling, general and administrative
expenses in the consolidated statements o
f
income
.
18. Stock-Based Compensation
The fair value of each o
p
tion award is estimated on the date
of grant using the Black-Scholes option pricing model that uses
the assumptions presented below
:
Expected term of option (in
y
ears) 4.
0
Expecte
d
vo
l
ati
l
ity 37.39
%
Dividend yield 2.10
%
Risk-
f
ree interest rate 0.95
%
A summary of option activity under the stock option plan as of
and for the year ended December 31, 2008 is presented below
:
S
h
a
r
es
Wei
g
hted-avera
ge
exerc
i
se
p
r
i
c
e
Weig
h
te
d-
a
v
erage
r
emainin
g
co
n
t
r
actua
l
te
rm
Agg
re
g
at
e
i
n
t
rin
s
i
c
v
a
l
ue
Yen
U
.
S
.
do
ll
a
r
s
Year
Millions of
y
e
n
Thousands of
U.S.
d
o
ll
ar
s
Outstandin
g
at Januar
y
1, 200
8
—
—
—
G
r
a
n
ted
592,000 ¥5,502 $60.46
For
f
eited —— —
Outstandin
g
at December 31, 200
8
592,000 ¥5,502 $60.46 3.3 ¥ — $ —
At December 31, 2008, all option awards were nonvested,
but ex
p
ected to be vested, and there was ¥492 million ($5,407
thousand) of total unrecognized compensation cost related to
nonvested stock option. That cost is expected to be recognized
over 1.33
y
ears
.