Columbia Sportswear 2003 Annual Report Download - page 55

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COLUMBIA SPORTSWEAR COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Rent escalation clauses, leasehold improvement funding, and other lease concessions present in the
Company’s leases are included in the computation of the minimum lease payments above and the minimum lease
payments are recognized on a straight-line basis over the minimum lease term.
The Company is a party to various legal claims, actions and complaints. Although the ultimate resolution of
legal proceedings cannot be predicted with certainty, management believes that disposition of these matters will
not have a material adverse effect on the Company’s consolidated financial statements.
NOTE 13—STOCK-BASED COMPENSATION
The Company’s 1997 Stock Incentive Plan (the “Plan”) provides for issuance of up to 5,400,000 shares of
the Company’s Common Stock of which 542,947 shares were available for future stock option grants under the
Plan at December 31, 2003. Options granted prior to 2001 generally become exercisable ratably over a five-year
period beginning from the date of grant and expire ten years from the date of grant. Options granted after 2000
generally become exercisable over a period of four years beginning one year after the date of grant and expire ten
years from the date of the grant.
The following table summarizes the stock option activity under the Company’s option plan:
Outstanding Exercisable
Number of
Shares
Weighted
Average
Exercise
Price
Number of
Shares
Weighted
Average
Exercise
Price
Options outstanding at January 1, 2001 ....................... 2,374,923 $11.89 712,139 $10.37
Granted................................................ 732,617 31.96
Cancelled .............................................. (178,146) 16.76
Exercised .............................................. (670,191) 10.73
Options outstanding at December 31, 2001 .................... 2,259,203 18.37 618,855 $11.07
Granted................................................ 823,780 38.27
Cancelled .............................................. (21,110) 27.98
Exercised .............................................. (410,665) 13.87
Options outstanding at December 31, 2002 .................... 2,651,208 25.17 906,787 $17.14
Granted................................................ 544,005 35.04
Cancelled .............................................. (62,799) 28.30
Exercised .............................................. (710,672) 20.42
Options outstanding at December 31, 2003 .................... 2,421,742 $28.67 963,994 $23.01
The Company continues to measure compensation cost for the Plan using the method of accounting
prescribed by APB 25. In electing to continue to follow APB 25 for expense recognition purposes, the Company
is required to provide the expanded disclosures required under SFAS No. 148 for stock-based compensation
granted, including disclosure of pro forma net income and earnings per share, as if the fair value based method of
accounting defined in the SFAS No. 123 “Accounting for Stock-Based Compensation”, had been adopted.
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