Callaway 1998 Annual Report Download - page 30

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CALLAWAY GOLF COMPANY
28
(in thousands, except per share data) Year ended December 31,
1998 1997 1996
Net (loss) income $(26,564) $132,704 $122,337
Weighted-average shares outstanding:
Weighted-average shares outstanding - Basic 69,463 68,407 66,832
Dilutive securities 3,291 3,829
Weighted average shares outstanding - Diluted 69,463 71,698 70,661
(Loss) earnings per common share
Basic $(0.38) $1.94 $1.83
Diluted $(0.38) $1.85 $1.73
NOTE 6
EARNINGS PER COMMON SHARE
The schedule below summarizes the elements included in the calculation of basic and diluted (loss) earnings per common
share for the years ended December 31, 1998, 1997 and 1996.
For the year ended December 31, 1998, all dilutive securities were excluded from the calculation of diluted loss per share,
as their effect would have been antidilutive. For the years ended December 31, 1997 and 1996, 917,000 and 269,000
options, respectively, were excluded from the calculations, as their effect would have been antidilutive.
NOTE 7
STOCK OPTIONS AND RIGHTS
Options
The Company had the following fixed stock option plans, under which shares were available for grant at December 31, 1998:
the 1991 Stock Incentive Plan (the “1991 Plan”), the 1995 Employee Stock Incentive Plan (the “1995 Plan”), the 1996 Stock
Option Plan (the “1996 Plan”), the 1998 Stock Incentive Plan (the “1998 Plan”), the Promotion, Marketing and
Endorsement Stock Incentive Plan (the “Promotion Plan”) and the Non-Employee Directors Stock Option Plan (the
“Directors Plan”).
The 1991 Plan, the 1996 Plan and the 1998 Plan permit the granting of options or other stock awards to the Company’s
officers, employees and consultants. Under the 1991 Plan, option prices may be less than the market value at the date of
grant, while under the 1996 Plan and the 1998 Plan options may not be granted at option prices that are less than fair mar-
ket value at the date of grant. The 1995 Plan permits the granting of options or other stock awards to only employees and
consultants of the Company at option prices that may be less than market value at the date of grant. The 1995 Plan and the
1996 Plan were amended in 1998 to increase the maximum number of options to acquire shares of Common Stock to
4,600,000 and 6,000,000 shares, respectively.
During 1996 and 1995, the Company granted options to purchase shares to two key officers, under separate plans,
in conjunction with terms of their initial employment (the “Key Officer Plans”). The 1990 Amended and Restated
Stock Option Plan (the “1990 Plan”) permitted the granting of options to officers, employees and consultants. No
shares are available for grant under the Key Officer Plans or the 1990 Plan.
Under the Promotion Plan, shares of Common Stock may be granted in the form of options or other stock awards to
golf professionals and other endorsers at prices that may be less than the market value of the stock at the grant date. The
Directors Plan permits the granting of options to purchase shares of Common Stock to Directors of the Company who are
not employees, at prices based on a non-discretionary formula, which currently may not be less than the market value of
the stock at the date of grant.