H O N I N D U S T R I E S I n c . a n d S U B S I D I A R I E S included in the Cash, Cash Equivalents, and Investments note included  in the Notes to Consolidated Financial Statements. Capital expenditures were $34.8 million in 2003, $25.9 million in  2002, and $36.9 million in 2001. Expenditures during 2003, 2002,  and 2001 have been consistently focused on machinery and equipment  needed to support new products, process improvements, and cost  savings initiatives. Expenditures in 2003 also included the purchase  from a related party of a previously leased hearth products plant for  $3.6 million.  Other long-term obligations includes $2,959,000 earn-out on convert- ible debentures included in current liabilities, $69,000 of financial  guarantees with customers, and $8,865,000 of payments included in  long-term liabilities, due to members who are participants in the  Company’s salary deferral program. During 2001, the Company completed the acquisition of three small  hearth products distributors for a total purchase price of approximately  $7.6 million. The acquisitions were accounted for using the purchase  method, and the results of the three distributors have been included in  the Company’s financial statements since the date of acquisition. On  January 5, 2004, the Company completed the acquisition of Paoli Inc.,  a provider of wood case goods and seating, for approximately $80 mil- lion. The acquisition will be accounted for using the purchase method. Cash dividends were $0.52 per common share for 2003, $0.50 for  2002, and $0.48 for 2001. Further, the Board of Directors announced  a 7.7% increase in the quarterly dividend from $0.13 to $0.14 per com- mon share effective with the March 1, 2004, dividend payment for  shareholders of record at the close of business February 20, 2004. The  previous quarterly dividend increase was from $0.125 to $0.13, effec- tive with the February 28, 2003, dividend payment for shareholders of  record at the close of business on February 21, 2003. A cash dividend  has been paid every quarter since April 15, 1955, and quarterly divi- dends are expected to continue. The average dividend payout  percentage for the most recent three-year period has been 32% of  prior year earnings. Long-term debt, including capital lease obligations, was 1% of total  capitalization at January 3, 2004, 2% at December 28, 2002, and 12%  at December 29, 2001. The reductions in long-term debt during 2003  and 2002 were due to the retirement of Industrial Revenue Bonds.  The Company does not expect future capital resources to be a constraint  on planned growth. Additional borrowing capacity of $136 million,  less amounts used for designated letters of credit, is available through  a revolving bank credit agreement in the event cash generated from  operations should be inadequate to meet future needs. Certain of the  Company’s credit agreements include covenants that limit the assump- tion of additional debt and lease obligations. The Company has been,  and currently is, in compliance with the covenants related to the debt  agreements. During 2003, the Company repurchased 762,300 shares of its com- mon stock at a cost of approximately $21.5 million, or an average  price of $28.22 per share. During 2002, the Company repurchased  614,580 shares of its common stock at a cost of approximately $15.7  million, or an average price of $25.60 per share. During 2001, the  Company repurchased 1,472,937 shares at a cost of approximately  $35.1 million, or an average price of $23.80 per share.  The Company has contingent liabilities that have arisen in the course of  its business, including pending litigation, preferential payments claims  in customer bankruptcies, environmental remediation, taxes, and other  The following table discloses the Company’s obligations and commit- ments to make future payments under contracts:  PAYMENTS DUE BY PERIOD CAPITAL EXPENDITURE INVESTMENTS ACQUISITIONS CASH DIVIDENDS LONG-TERM DEBT CONTRACTUAL OBLIGATIONS LITIGATION AND UNCERTAINTIES COMMON SHARE REPURCHASES 37 Less than  1 – 3  4 – 5   After (In thousands) Total  1 year  years  years  5 years Long-term debt  $ 28,933  26,243  212  95  2,383 Capital lease obligations 2,338  523  799  426  590 Operating leases  50,750  13,012  19,166  9,510  9,062 Transportation service  contract  9,650  4,794  4,856  –  – Other long-term  obligations  11,893  4,289  1,430  914  5,260 Total $ 103,564  48,861  26,463  10,945  17,295