Nautilus 2003 Annual Report Download - page 53

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Table of Contents
required to consolidate, but in which it has a significant variable interest. FIN No. 46 consolidation requirements are effective for all
variable interest entities created after January 31, 2003, and to pre-existing entities in the first fiscal year or interim period ending after
December 15, 2003. Certain disclosure requirements are effective for financial statements issued after January 31, 2003. The adoption of
FIN No. 46 has no effect on the Company’s financial position, results of operations or cash flows.
In May 2003, the FASB issued SFAS No. 150, Accounting for Certain Financial Instruments with Characteristics of both Liabilities and
Equity , effective for financial instruments entered into or modified after May 31, 2003, and otherwise is effective at the beginning of the
first interim period beginning after June 15, 2003. The adoption of SFAS No. 150 has not had a material impact on the Company’s
financial position, results of operations, or cash flows.
Reclassifications – Certain amounts from 2002 and 2001 have been reclassified to conform to the 2003 presentation with no effect on
previously reported consolidated net income or stockholders’ equity.
2.
STOCK
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BASED COMPENSATION
The Company’s stock-based compensation plan was adopted in June 1995. The Company can issue nonqualified stock options to the
Company’s executive officers, directors and employees and incentive stock options to the Company’s executive officers and employees.
The plan was amended in June 2000 so the Company may grant options for up to 7,958,118 shares of common stock. At December 31,
2003, 844,754 shares are available for future issuance under the plan. The plan is administered by the Company’s Board of Directors
which determines the terms and conditions of the various grants awarded under these plans. Stock options granted generally have an
exercise price equal to the closing market price of the Company’s stock on the day before the date of grant, and vesting periods vary by
option granted, generally no longer than five years.
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