Audiovox 2010 Annual Report Download - page 75

Audiovox Corporation and Subsidiaries
Notes to Consolidated Financial Statements, continued
February 28, 2010
(Dollars in thousands, except share and per share data)
r) Other Income (Loss)
Other income (loss) is comprised of the following:
Year Year Year
Ended Ended Ended
February 28, February 28, February 29,
2010 2009 2008
Gain on sale of Bliss-tel investment $ - $ - $ 1,533
Other-than-temporary impairment of investment in Bliss-tel marketable
securities (1,000) - -
Interest Income 990 1,260 3,078
Rental income 537 538 552
Other 6,767 (3,467) (454)
Total other, net $ 7,294 $ (1,669) $ 4,709
Other income (loss) includes a gain of $5,400 net of deferred taxes from the Company’s acquisition of its Schwaiger
operation for the year ended February 28, 2010.
s) Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to be disposed of
Long-lived assets and certain identifiable intangibles are reviewed for impairment in accordance with ASC 350
whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.
Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future
undiscounted net cash flows expected to be generated by the asset. Recoverability of assets held for sale is measured by
comparing the carrying amount of the assets to their estimated fair market value. If such assets are considered to be
impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceed
the fair value of the assets.
t) Accounting for Stock-Based Compensation
The Company has stock option plans under which employees and non-employee directors may be granted incentive
stock options (“ISO's”) and non-qualified stock options (“NQSO's”) to purchase shares of Class A common stock. Under
the stock option plans, the exercise price of the ISO's will not be less than the market value of the Company's Class A
common stock or greater than 110% of the market value of the Company's Class A common stock on the date of grant.
The exercise price of the NQSO's may not be less than 50% of the market value of the Company's Class A common
stock on the date of grant. The options must be exercised no later than ten years after the date of grant. The vesting
requirements are determined by the Board of Directors at the time of grant. Exercised options are issued from authorized
Class A Common Stock. As of February 28, 2010, 1,533,428 shares were available for future grants under the terms of
these plans.
Options are measured at the fair value of the award at the date of grant and are recognized as an expense over the
requisite service period. Compensation expense related to stock-based awards with vesting terms are amortized using the
straight-line attribution method.
The Company granted 861,250 options in September of 2009, one-half vested on November 30, 2009 and one-half will
vest on November 30, 2010, expire three years from date of vesting (November 30, 2012 and November 30, 2013,
respectively), have an exercise price equal to $6.37 (the sales price of the Company’s stock on the day prior to the date of
grant) have a contractual term between 3.2 and 4.2 years and a grant date fair value of $2.69 per share determined based
upon a Black-Sholes valuation model (refer to the table below for assumptions used to determine fair value).
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Source: AUDIOVOX CORP, 10-K, May 14, 2010 Powered by Morningstar® Document Research℠