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STOCK-BASED COMPENSATION
The Company accounts for employee stock-based
compensation using the intrinsic value method prescribed by Accounting
Principles Board (APB) Opinion No. 25, "Accounting for Stock Issued
to Employees" and related interpretations. Under this method, the
Company records no compensation expense for stock options granted
when the exercise price of those options is equal to or greater
than the market price of the Company's common stock on the date
of grant. As allowed by SFAS No. 123, "Accounting for Stock Based
Compensation," the Company has continued to apply APB No. 25 for
the purposes of determining net income.
In December 2002, the Financial Accounting
Standards Board (FASB) issued SFAS No. 148, "Accounting for Stock
Based Compensation - Transition and Disclosure, an amendment of
SFAS No. 123." The Company has adopted the disclosure requirements
of SFAS No. 148 and has elected to record employee compensation
expense utilizing the intrinsic value method permitted under APB
25. The Company accounts for its employees' stock-based compensation
plan under APB Opinion No. 25 and its related interpretations. Accordingly,
any deferred compensation expense would be recorded for stock options
based on the excess of the market value of the common stock on the
date the options were granted over the aggregate exercise price
of the options. This deferred compensation would be amortized over
the vesting period of each option to the extent that the market
value exceeds the exercise price of the option. Had compensation
cost been determined consistent with SFAS No. 123 "Accounting for
Stock Based Compensation" for all options, the Company's net income
and earnings per share would have been as follows:
Repriced options are accounted for as compensatory
options using variable accounting treatment in accordance with FASB
Interpretation No. 44, "Accounting for Certain Transactions involving
Stock Based Compensation - on Interpretation of APB No. 25" (FIN
44). Under variable plan accounting, compensation expense is adjusted
for increases or decreases in the fair market value of the
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