Stockholders' Equity

12 Months Ended

Nov. 30, 2013

Stockholders' Equity

Stockholders' Equity

12. Stockholders' Equity

• Per Share Results

        Basic and diluted results per share were based on the following:

	For the Fiscal Years Ended,
	Nov. 30, 2013			Dec. 1, 2012		Dec. 3, 2011
Income (loss) from continuing operations for computation of basic and diluted per share results, net of tax	$	1,910		$	196	$	(1,308	)
(Loss) income from discontinued operations for computation of basic and diluted per share results, net of tax		(7,731	)		770		(1,166	)
Net (loss) income	$	(5,821	)	$	966	$	(2,474	)
Weighted average shares outstanding for computation of basic per share results		5,144,000			5,138,000		5,130,000
Incremental shares from assumed exercise of Griffin stock options(a)		8,000			5,000		—
Adjusted weighted average shares for computation of diluted per share results		5,152,000			5,143,000		5,130,000

(a)

Incremental shares from the assumed exercise of Griffin stock options are not included in periods where inclusion of such shares would be anti-dilutive. Such assessment is based on income (loss) from continuing operations when net income includes discontinued operations. For the fiscal year ended December 3, 2011, the incremental shares from the assumed exercise of stock options would have been 8,000 shares.

• Griffin Stock Option Plan

        The Griffin Land & Nurseries, Inc. 2009 Stock Option Plan (the "2009 Stock Option Plan") makes available options to purchase 386,926 shares of Griffin common stock, including 161,926 options to purchase the 161,926 shares that were available for issuance under Griffin's prior stock option plan. The Compensation Committee of Griffin's Board of Directors administers the 2009 Stock Option Plan. Options granted under the 2009 Stock Option Plan may be either incentive stock options or non-qualified stock options granted at fair market value on the date approved by Griffin's Compensation Committee. Vesting of all of Griffin's stock options is solely based upon service requirements and does not contain market or performance conditions.

        Stock options granted will expire ten years from the grant date. In accordance with the 2009 Stock Option Plan, stock options granted to non-employee directors upon their initial election to the board of directors are fully exercisable immediately upon the date of the option grant. Stock options granted to non-employee directors upon their reelection to the board of directors vest on the second anniversary from the date of grant. Stock options granted to employees vest in equal installments on the third, fourth and fifth anniversaries from the date of grant. None of the stock options outstanding at November 30, 2013 may be exercised as stock appreciation rights.

        The following options were granted by Griffin under the 2009 Stock Option Plan to non-employee directors either upon their initial election or their reelection to Griffin's Board of Directors and to Griffin's employees:

	For the Fiscal Years Ended,
	November 30, 2013				December 1, 2012			December 3, 2011
	Number of Shares		Fair Value per Option at Grant Date		Number of Shares		Fair Value per Option at Grant Date	Number of Shares		Fair Value per Option at Grant Date
Non-employee directors		8,112	$	12.94		10,996	$10.66 - $14.89		8,712	$12.03
Employees		—				—			104,500	$10.37 - $12.88
Total		8,112				10,996			113,212

        The fair values were estimated as of the date of each grant using the Black-Scholes option-pricing model. The following assumptions were used in determining the fair values of each option:

	For the Fiscal Years Ended,
	Nov. 30, 2013			Dec. 1, 2012	Dec. 3, 2011
Expected volatility		40.3	%	39.6% - 41.1%	42.0% - 43.4%
Range of risk free interest rates		1.33	%	1.02% - 1.19%	2.06% - 2.81%
Expected option term (in years)		8.5		8.5	5 to 8.5
Annual dividend yield		0.7	%	0% - 0.7%	1.4%

        Compensation expense and related tax benefits for stock options were as follows:

	For the Fiscal Years Ended,
	Nov. 30, 2013		Dec. 1, 2012		Dec. 3, 2011
Compensation expense	$	467	$	604	$	564
Related tax benefit	$	114	$	148	$	138

        For all years presented, forfeiture rates of 0%, 22.6% and 41.1%, respectively, were utilized based on the historical activity of the grantees, including the groups in which the grantees are part of, such as directors, executives and employees.

Number of option holders at November 30, 2013 17

        As of November 30, 2013, the unrecognized compensation expense related to nonvested stock options that will be recognized during future periods is as follows:

Fiscal 2014	$	262
Fiscal 2015	$	111
Fiscal 2016	$	12

        The total grant date fair value of options vested during fiscal 2013, fiscal 2012 and fiscal 2011 was $466, $523 and $269, respectively. The intrinsic value of options exercised in fiscal 2013, fiscal 2012 and fiscal 2011 was $114, $49 and $137, respectively. A summary of the activity under the 2009 Griffin Stock Option Plan is as follows:

	Number of Shares			Weighted Avg. Exercise Price
Outstanding at November 27, 2010		149,611		$	29.69
Granted in 2011		113,212			28.68
Exercised in 2011		(10,667	)		17.45
Forfeited in 2011		(7,638	)		28.47
Outstanding at December 3, 2011		244,518			29.79
Granted in 2012		10,996			25.45
Exercised in 2012		(6,741	)		17.80
Forfeited in 2012		(4,932	)		32.43
Outstanding at December 1, 2012		243,841			29.88
Granted in 2013		8,112			29.58
Exercised in 2013		(6,776	)		11.81
Forfeited in 2013		(5,500	)		31.12
Outstanding at November 30, 2013		239,677		$	30.35

Range of Exercise Prices	Outstanding at Nov. 30, 2013		Weighted Avg. Exercise Price		Weighted Avg. Remaining Contractual Life (in years)		Total Intrinsic Value
$23.00 - $28.00		21,276	$	25.37		6.0		162
$28.00 - $32.00		127,826	$	28.96		6.9		517
$32.00 - $35.00		90,575	$	33.48		4.9		2
		239,677	$	30.35		6.1	$	681

• Accumulated Other Comprehensive Loss

        As of November 30, 2013, Griffin held 2,452,462 shares of common stock in Centaur Media and accounts for its investment in Centaur Media as an available-for-sale security under ASC 320-10. Accordingly, the investment in Centaur Media is carried at its fair value on Griffin's consolidated balance sheet, with increases or decreases recorded, net of tax, as a component of other comprehensive income. Upon the sale of shares in Centaur Media, the change, net of tax, in the value of the shares of Centaur Media that were sold during the time Griffin held those shares is reclassified from accumulated other comprehensive income and included in Griffin's consolidated statement of operations. In fiscal 2013, $716 was reclassified from accumulated other comprehensive loss for the sale of 2,824,688 shares of Centaur common stock. There were no sales of Centaur common stock in either fiscal 2012 or fiscal 2011.

        Griffin complies with ASC 715-10 which requires an employer to recognize the overfunded or underfunded status of a defined benefit postretirement plan as an asset or liability on its statement of financial position and to recognize changes in that funded status in the year in which the changes occur through comprehensive income. As a result, in fiscal 2013, noncurrent liabilities decreased by $116 and other comprehensive income increased by $68, after tax. In fiscal 2012 and fiscal 2011, noncurrent liabilities increased by $62 and $37, respectively, and other comprehensive income decreased by $48 and $35, respectively, after tax.

        Accumulated other comprehensive loss, and activity for the period, is comprised of the following:

	Unrealized loss on cash flow hedges			Unrealized gain on investment in Centaur Media			Actuarial gain on postretirement benefit plan		Total
Balance December 1, 2012	$	(2,011	)	$	1,054		$	236	$	(721	)
Other comprehensive income (loss) before reclassfications		100			310			68		478
Amounts reclassified		510			(716	)		—		(206	)
Net current period activity for other comprehensive loss		610			(406	)		68		272
Balance November 30, 2013	$	(1,401	)	$	648		$	304	$	(449	)

        Changes in accumulated other comprehensive income (loss) are as follows:

	For the Fiscal Years Ended,
	November 30, 2013									December 1, 2012									December 3, 2011
	Pre-Tax			Tax (Expense) Benefit			Net-of-Tax			Pre-Tax			Tax (Expense) Benefit			Net-of-Tax			Pre-Tax			Tax (Expense) Benefit			Net-of-Tax
Reclassifications included in net (loss) income:
Realized gain on sale of Centaur Media (gain on sale)	$	(1,099	)	$	383		$	(716	)	$	—		$	—		$	—		$	—		$	—		$	—
Loss on cash flow hedges (interest expense)		810			(300	)		510			666			(246	)		420			730			(270	)		460
Total reclassifications included in net (loss) income		(289	)		83			(206	)		666			(246	)		420			730			(270	)		460
Mark to market adjustment on Centaur Media for the increase (decrease) in fair value		481			(169	)		312			1,111			(389	)		722			(2,098	)		735			(1,363	)
Mark to market adjustment on Centaur Media for the increase (decrease) in exchange gain		(1	)		(1	)		(2	)		110			(38	)		72			1			—			1
Increase (decrease) in fair value adjustment on Griffin's cash flow hedges		159			(59	)		100			(1,442	)		533			(909	)		(1,664	)		616			(1,048	)
Actuarial gain (loss) on postretirement benefits program		108			(40	)		68			(77	)		29			(48	)		(56	)		21			(35	)
Total change in other comprehensive income (loss)		747			(269	)		478			(298	)		135			(163	)		(3,817	)		1,372			(2,445	)
Total other comprehensive income (loss)	$	458		$	(186	)	$	272		$	368		$	(111	)	$	257		$	(3,087	)	$	1,102		$	(1,985	)

• Cash Dividends

        In November 2011, Griffin's Board of Directors considered its dividend policy for succeeding years and decided that, beginning in fiscal 2012, rather than continuing to pay a quarterly dividend, it will consider the payment of an annual dividend at the end of its fiscal year. This change permits the Board to evaluate better both Griffin's prior full year results and its cash needs for the succeeding year when determining whether to declare an annual dividend.

        In fiscal 2013 and fiscal 2012, Griffin declared annual dividends of $0.20 per common share, which were paid in the fiscal 2014 first quarter and fiscal 2013 first quarter, respectively. In fiscal 2011, Griffin declared dividends of $0.10 per common share for each quarter which were paid in the last three quarters of fiscal 2011 and in the fiscal 2012 first quarter to its common stockholders.

• Treasury Stock

        In fiscal 2013 and fiscal 2011, Griffin did not receive any shares of its common stock in connection with the exercise of stock options. In fiscal 2012, Griffin received 1,355 shares of its common stock in connection with the exercise of stock options. The shares received were recorded as treasury stock, which resulted in an increase in treasury stock of $40.