Cabela's 2010 Annual Report Download - page 106

Download and view the complete annual report

Please find page 106 of the 2010 Cabela's annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 128

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128

96
CABELA’S INCORPORATED AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands Except Share and Per Share Amounts)
Ratio Required to be Considered
Actual Adequately-Capitalized Well-Capitalized
Amount Ratio Amount Ratio Amount Ratio
2010:
Total Capital to Risk-Weighted Assets $ 348,968 12.2% $ 229,687 8.0% $ 287,108 10.0%
Tier I Capital to Risk-Weighted Assets 312,400 10.9 114,843 4.0 172,265 6.0
Tier I Capital to Average Assets 312,400 10.2 122,875 4.0 153,594 5.0
2009:
Total Capital to Risk-Weighted Assets 216,634 27.8 62,421 8.0 78,026 10.0
Tier I Capital to Risk-Weighted Assets 194,587 24.9 31,211 4.0 46,816 6.0
Tier I Capital to Average Assets 194,587 23.7 32,847 4.0 41,058 5.0
At the beginning of 2010, WFB’s required capital was increased under regulatory capital requirements of
the applicable federal agencies due to the consolidation of the assets and liabilities of the Trust on WFB’s balance
sheet. In order for WFB to continue to meet the minimum requirements for the well-capitalized classification under
the regulatory framework for prompt corrective action, Cabela’s invested $150,000 in 2010 in additional paid-in
capital in WFB which qualified as Tier 1 capital.
In 2009, WFB received $25,000 from Cabela’s as additional paid-in capital which qualified as Tier 1 capital.
In December 2008, WFB received $25,000 from Cabela’s in exchange for 250,000 shares of WFB convertible
participating preferred stock. In February 2010, Cabela’s converted this preferred stock to additional paid-in capital
which qualified as Tier 1 capital.
20. STOCK BASED COMPENSATION PLANS AND EMPLOYEE BENEFIT PLANS
Stock-Based Compensation – The Company recognized total share-based compensation expense of $11,198,
$9,410, and $6,535 in 2010, 2009, and 2008, respectively. Compensation expense related to the Company’s share-
based payment awards is recognized in selling, distribution, and administrative expenses in the consolidated
statements of income. Compensation cost for awards is recognized using a straight-line amortization method over
the vesting period. As of January 1, 2011, the total unrecognized deferred share-based compensation balance for all
equity awards issued, net of expected forfeitures, was $9,370, net of tax, which is expected to be amortized over a
weighted average period of 1.8 years.
The fair value of options granted is estimated on the date of the grant using the Black-Scholes option pricing
model. The expected volatility for 2010, 2009, and 2008 was based on the historical volatility of the Company’s
common stock. The fair value of options in the years presented was estimated using the Black-Scholes model with
the following weighted average assumptions:
2010 2009 2008
Risk-free interest rate based on U.S. Treasury yield
curve in effect at the grant date 2.26 to 2.35% 1.86 to 2.48% 1.34 to 3.22%
Dividend yield - - -
Expected volatility 45 to 46% 45 to 46% 35 to 43%
Weighted average expected life based on historical information 5.0 years 5.0 years 5.0 years
Weighted average grant date fair value of options granted $ 7.02 $7.94 $5.49