NOTES TO CONSOLIDATED FINANCIAL STATEMENTS If we had adopted the provisions of SFAS No. 123 to our option grants and ESPP as of January 1, 2002, our net income  to common shareholders and related basic and diluted earnings per share would be as follows: The effects of applying SFAS No. 123 in this pro forma disclosure are not indicative of future amounts. In June 2004, the Emerging Issues Task Force (“EITF”) issued EITF 03-01, “The Meaning of Other-Than-Temporary  Impairment and Its Application to Certain Investments”, which provides guidance to determine when an investment is  considered impaired, whether the impairment is other than temporary, and the measurement of an impairment loss.  EITF 03-01 was effective for the first interim period beginning after June 15, 2004. The adoption of EITF 03-01 did not  have a material impact on our financial position, results of operations or cash flows. In December 2004, FASB issued SFAS No.123(R) “Share-Based Payment”, which replaces SFAS No.123, “Accounting for  Stock-Based Compensation”, and supersedes APB Opinion No. 25, “Accounting for Stock Issued to Employees”. SFAS  No. 123(R) requires an entity to measure the cost of employee services received in exchange for an award of equity  instruments based on the grant date fair value of the award. SFAS No. 123(R) is effective beginning July 1, 2005, and  is required to be adopted using a “modified prospective” method. Under the modified prospective method, SFAS No.  123(R) applies to new awards and to awards modified, repurchased or cancelled after the effective date. Additionally,  compensation cost for the unvested portion of awards as of the effective date is required to be recognized as the awards  vest after the effective date. The adoption of SFAS No. 123(R) will not have a material impact on our financial position,  results of operations or cash flows.  In December 2004, FASB issued SFAS No. 153, “Exchange of Nonmonetary Assets, an amendment of APB Opinion  No. 29”, which addresses the measurement of exchanges of nonmonetary assets. SFAS No. 153 eliminates the  exception for nonmonetary exchanges of similar productive assets and replaces it with a general exception for exchange  of nonmonetary assets that do not have commercial substance. It also specifies that a nonmonetary exchange has  commercial substance if the future cash flows of the entity are expected to change significantly as a result of the  exchange. SFAS No. 153 is effective beginning July 1, 2005. The adoption of SFAS No. 153 will not have a material impact  on our financial position, results of operations or cash flows. Certain reclassifications have been made to amounts in prior year financial statements to conform with current  year presentations. Recent Accounting Pronouncements Reclassifications transforming camden 77 year ended december 31, in thousands, except per share amounts  2004 2003 2002 Net income, as reported $ 41,341 $ 29,430 $ 74,612  Add: stock-based employee compensation expense included  in reported net income 3,842 3,247 2,918  Deduct: total stock-based employee compensation expense determined under fair value method for all awards (4,536) (4,113) (3,521) Pro forma net income  40,647 $ 28,564  $ 74,009  Net income per share: Basic – as reported  1.00  $ 0.75 Basic – pro forma  0.98 0.73 1.83 Diluted – as reported 0.98 0.71 1.73  Diluted – pro forma 0.96 0.69  1.71