Red Lobster 1999 Annual Report Download - page 21

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Notes
to Consolidated Financial Statements
42
NOTE 17 – EMPLOYEE STOCK PURCHASE PLAN
Effective January 1, 1999, the Company adopted the
Darden Restaurants Employee Stock Purchase Plan to
provide eligible employees who have completed one
year of service an opportunity to purchase shares of its
common stock, subject to certain limitations. Under the
plan, employees may elect to purchase shares at the
lower of 85 percent of the fair market value of the
Company’s common stock as of the first or last trading
days of each quarterly participation period. During 1999,
employees purchased 55,000 shares of common stock.
An additional 1,345,000 shares are available for issuance
as of May 30, 1999.
As the Company applies APB 25 in accounting for its
Employee Stock Purchase Plan, no compensation cost
has been recognized for shares issued under the plan.
The impact of recognizing compensation expense for
purchases made under the plan in 1999 in accordance
with the fair value method specified in SFAS 123 is
not significant to the Company’s financial statement
disclosures.
NOTE 18 – COMMITMENTS AND CONTINGENCIES
Darden makes trade commitments in the course of its
normal operations and is subject to litigation incident to
the conduct of its ongoing business. As of May 30, 1999,
the Company was contingently liable for approximately
$26,963, primarily relating to outstanding letters of credit.
In the opinion of management, there are no unusual
commitments or contingencies at May 30, 1999, that
would materially affect the financial position or operating
results of Darden.
NOTE 19 – QUARTERLY DATA (UNAUDITED)
Summarized quarterly data for 1999 and 1998 are as follows:
Fiscal 1999 — Quarters Ended
Aug. 30 Nov. 29 Feb. 28 May 30 Total
Sales $ 886,057 $ 791,168 $ 866,907 $ 913,975 $ 3,458,107
Gross Profit 175,105 147,111 182,510 208,464 713,190
Earnings before Interest and Taxes 59,306 29,443 62,939 83,727 235,415
Earnings before Taxes 53,871 24,657 58,517 78,830 215,875
Net Earnings 35,179 15,919 38,353 51,087 140,538
Net Earnings per Share:
Basic $ 0.25 $ 0.11 $ 0.28 $ 0.38 $ 1.02
Diluted $ 0.24 $ 0.11 $ 0.27 $ 0.37 $ 0.99
Fiscal 1998 — Quarters Ended
Aug. 24 Nov. 23 Feb. 22 May 31 Total
Sales $ 809,331 $ 745,263 $ 811,261 $ 921,162 $ 3,287,017
Gross Profit 161,620 132,534 165,650 198,783 658,587
Earnings before Interest and Taxes 40,943 16,509 50,307 65,997 173,756
Earnings before Taxes 36,250 11,786 45,228 60,408 153,672
Net Earnings 24,408 7,530 29,758 40,018 101,714
Net Earnings per Share:
Basic $ 0.16 $ 0.05 $ 0.20 $ 0.28 $ 0.69
Diluted $ 0.16 $ 0.05 $ 0.20 $ 0.27 $ 0.67