Under Armour 2007 Annual Report Download - page 72

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The holders of the Series A Preferred Stock were entitled to receive cumulative preferential dividends at 8%
of the stated redemption value of $10 per share compounded annually if declared by the Board of Directors. The
Series A Preferred Stock was redeemable at the option of the holders in September 2008 at a redemption price of
$10 per share, plus 125% of accrued but unpaid dividends plus 25% of any previously declared dividends that
were not paid within 120 days after the respective year end (the “Redemption Price”). The Series A Preferred
Stock also carried a liquidation preference equal to its stated Redemption Price and could be redeemed by the
Company at any time at the then stated Redemption Price. The amount of the Redemption Price, including
issuance costs, was being accreted to the value of the Series A Preferred Stock each year. For the year ended
December 31, 2005, $5.3 million had been accreted to the Redemption Price of the Series A Preferred Stock.
As required, the Series A Preferred Stock was redeemed at the $10 stated value per share, or $12.0 million,
upon the initial public offering.
10. Other Income (Expense), Net
The components of other income (expense), net consisted of the following:
Year Ended December 31,
(In thousands) 2007 2006 2005
Interest income ............................................ $1,549 $2,231 $ 273
Interest expense ............................................ (800) (774) (3,188)
Unrealized foreign currency exchange rate gains (losses) ........... 2,567 (161) —
Realized foreign currency exchange rate gains ................... 174 520 79
Unrealized derivative losses .................................. (243) — —
Realized derivative losses .................................... (469) — —
Miscellaneous ............................................. — 353 —
Total other income (expense), net .......................... $2,778 $2,169 $(2,836)
For the years ended December 31, 2007, 2006 and 2005, the Company amortized and included in interest
expense $0.2 million, $0.2 million and $0.3 million, respectively, of deferred financing costs.
11. Provision for Income Taxes
The components of the provision for income taxes consisted of the following:
Year Ended December 31,
(In thousands) 2007 2006 2005
Current
Federal ................................................ $35,542 $24,083 $12,009
State .................................................. 5,379 2,630 1,509
Other foreign countries .................................... 473 116 68
41,394 26,829 13,586
Deferred
Federal ................................................ (4,257) (2,656) (573)
State .................................................. 290 (3,120) 242
Other foreign countries .................................... (942) (945) —
(4,909) (6,721) (331)
Provision for income taxes ................................. $36,485 $20,108 $13,255
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