Stamps.com 2006 Annual Report Download - page 58

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STAMPS.COM INC.
NOTES TO FINANCIAL STATEMENTS
8. Income Taxes – (continued)
Differences between the provision for income taxes and income taxes at the statutory federal income tax rate are as follows (in thousands):
9. Commitments and Contingencies
Operating Leases
The following is a schedule of significant future minimum lease payments under operating leases at December 31, 2006 (in thousands):
Total rent expense from operations for the years ended December 31, 2006, 2005 and 2004 were $657,000, $646,000, and $1.1 million,
respectively.
In November 2003, we entered into a facility lease agreement commencing on March 2004 for our corporate headquarters with aggregate
lease payments of approximately $4.0 million through February 2010. As of December 31, 2006, the Company maintained a letter of credit for
the facility lease in the amount of $554,000.
10. Employee Stock Plans
Stock Incentive Plans
The 1999 Stock Incentive Plan (the “1999 Plan”) serves as the successor to the 1998 Stock Plan (the “Predecessor Plan”). The 1999 Plan
became effective in June 1999. At that time, all outstanding options under the Predecessor Plan were transferred to the 1999 Plan, and no
further option grants can be made under the Predecessor Plan. All outstanding options under the Predecessor Plan continue to be governed by
the terms and conditions of the existing option agreements for those grants, unless the Company’s compensation committee decides to extend
one or more features of the 1999 Plan to those options.
As of December 31, 2006, the total number of shares authorized for issuance under the 1999 Plan approximated 7,654,262 which amount
includes an automatic annual increase to the share reserve of 3% of the Company’s outstanding common shares on the last trading day in
December. The automatic increase on January 1, 2006 was approximately 692,000 shares based upon 23,063,000 shares outstanding on the last
day of 2005.
F-18
2006
2005
2004
Income tax at statutory federal rate
$
5,653
$
3,630
$
(1,609
)
State income taxes, net of federal benefit
1,095
645
(276
)
Effect of permanent differences
1
1
3
Other
(4,336
)
(1,165
)
—
Change in valuation allowance
(2,249
)
(2,865
)
1,883
$
164
$
246
$
1
Operating
Years ended:
2007
694
2008
751
2009
794
2010
134
2011 —
Thereafter —
$
2,373