Garmin 2005 Annual Report Download - page 97

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67
each award is ten years. All awards vest evenly over a three-year period. During 2005, 2004, and 2003, options to
purchase 5,500, 6,621, and 3,648 shares were granted under this plan.
A summary of the Company’s stock-based compensation activity and related information under the 2005
Equity Incentive Plan, the 2000 Equity Incentive Plan and the 2000 Non-employee Directors’ Option Plan for the
years ended December 31, 2005, December 25, 2004, and December 27, 2003 is provided below:
Weighted-Average
Exercise Price Number of Shares
(In Thousands)
Outstanding at December 28, 2002 18.90 1,874
Granted 54.30 581
Exercised 14.91 (176)
Canceled 18.19 (22)
Outstanding at December 27, 2003 28.42 2,257
Granted 39.74 703
Exercised 17.12 (202)
Canceled 32.15 (33)
Outstanding at December 25, 2004 32.12 2,725
Granted 53.01 836
Exercised 21.36 (322)
Canceled 37.01 (62)
Outstanding at December 31, 2005 38.57 3,177
December 31, December 25, December 27,
2005 2004 2003
Weighted-average fair value of options
granted during the year $18.96 $14.26 $22.01
Exercise Options Remaining Options
Price Outstanding Life (Years) Exercisable
(In Thousands) (In Thousands)
$14-$24 796 5.25 722
$25-$34 371 7.04 194
$35-$44 1,037 9.00 120
$45-$54 521 7.98 195
$55-$64 450 9.96 -
$65-$74 2 9.99 -
3,177 7.80 1,231
Stock Options as of December 31, 2005
The weighted-average remaining contract life for options outstanding at December 31, 2005 is 7.80 years.
Pro forma information regarding net income and earnings per share is required by SFAS No. 123.
SFAS No. 123 requires the pro forma information be determined as if the Company has accounted for its employee
stock options under the fair value method of that statement. As described below, the fair value accounting provided
under SFAS No. 123 requires the use of option valuation models that were not developed for use in valuing
employee stock options. The fair value for these options was estimated at the date of grant using a Black-Scholes
option pricing model with the following weighted-average assumptions for 2005, 2004, and 2003: risk-free interest
rate of 4.10%, 3.80%, and 4.25% , respectively; dividend yields of 0.98%, 1.3% and 1.0% for 2005, 2004 and 2003,
respectively; volatility factor of the expected market price of the Company’s common stock of 0.3224, 0.3577, and