Logitech 2004 Annual Report Download - page 115

LOGITECH INTERNATIONAL S.A.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Compensation expense is recognized over the vesting period when the exercise price of an option is less
than the fair market value of the underlying stock on the date of grant. Compensation expense of $92,000 and
$196,000 was recorded in fiscal years 2003 and 2002 for such option grants. These amounts were accrued as a
liability when the expense was recognized and subsequently credited to additional paid-in capital upon exercise
of the related stock option. No compensation expense was recognized in fiscal year 2004 and no further
compensation expense will be recognized in future periods related to these historical grants.
A summary of activity under the stock option plans is as follows (exercise prices are weighted averages):
Year ended March 31,
2004 2003 2002
Number
Exercise
Price Number
Exercise
Price Number
Exercise
Price
Outstanding, beginning of year .......... 7,737,136 $21 7,787,950 $17 7,846,660 $12
Granted ............................. 1,249,880 $33 1,581,725 $31 2,355,375 $27
Exercised ........................... (1,577,644) $16 (1,301,845) $ 9 (1,998,981) $ 7
Cancelled or expired ................... (245,274) $34 (330,694) $30 (415,104) $15
Outstanding, end of year ................ 7,164,098 $26 7,737,136 $21 7,787,950 $17
Exercisable, end of year ................ 3,291,734 $19 3,612,857 $13 2,796,675 $ 9
The following table summarizes information regarding stock options outstanding at March 31, 2004
(exercise prices and contractual lives are weighted averages):
Options Outstanding Options Exercisable
Range of
Exercise Price Number
Exercise
Price
Contractual
Life (years) Number
Exercise
Price
$ 2 – $10.99 1,669,232 $ 6 4.6 1,668,399 $ 6
$11 – $26.99 1,003,021 $23 7.5 310,106 $23
$27 – $30.99 1,380,105 $28 7.8 455,721 $28
$31 – $36.99 2,324,250 $33 8.5 492,197 $34
$37 – $64.99 787,490 $43 7.6 365,311 $44
$ 2 – $64.99 7,164,098 $26 7.2 3,291,734 $19
Defined Contribution Plans
Certain of the Company’s subsidiaries have defined contribution employee benefit plans covering all or a
portion of their employees. Contributions to these plans are discretionary for certain plans and are based on
specified or statutory requirements for others. The charges to expense for these plans for the years ended
March 31, 2004, 2003 and 2002, were $5.1 million, $3.4 million and $2.7 million.
Defined Benefit Plan
One of the Company’s subsidiaries sponsors a noncontributory defined benefit pension plan covering
substantially all of its employees. Retirement benefits are provided based on employees’ years of service and
earnings. The Company’s practice is to fund amounts sufficient to meet the requirements set forth in the
applicable employee benefit and tax regulations. Net pension costs for the years ended March 31, 2004, 2003 and
2002 were $.9 million, $.4 million and $.3 million. The plan’s net pension liability at March 31, 2004 and 2003
was $1.6 million and $.8 million.
F-18