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Stockholders' Equity
12 Months Ended
Sep. 30, 2011
Stockholders' Equity  
Stockholders' Equity

12. Stockholders' Equity

  • 2006 Omnibus Long-Term Incentive Plan

        In conjunction with the Company's initial public offering, the board of directors and the Company's shareholders approved the 2006 Omnibus Long-Term Incentive Plan, or the 2006 Plan, on December 2, 2005. The 2005 Stock Option and Incentive Plan was terminated when the 2006 Plan became effective, immediately after the closing of the initial public offering.

        A portion of the options and restricted shares granted to employees vest based on certain performance conditions being satisfied by the Company. Performance-based stock options are tied to the Company's annual performance against pre-established internal targets and the actual payout under these awards may vary from zero to 100% of an employee's target payout, based upon the Company's actual performance during the previous twelve months. The performance-based stock options are also subject to vesting requirements and generally vest when the performance condition has been satisfied. The fair value for stock options granted during the period was estimated at the grant date using the Black-Scholes option pricing model, as described in Note 2, and the fair value of restricted shares granted is based on the closing price of the shares on the grant date. Compensation cost is recognized when the performance condition has been satisfied or when it becomes probable that the performance condition will be satisfied.

        Under the 2006 Plan, 5,000,000 shares of common stock were initially reserved for issuance. In February 2009, at the Company's annual meeting of stockholders, the stockholders approved an increase of 5,000,000 shares of the Company's common stock to the shares available for issuance under the 2006 Plan. At September 30, 2009, there were 5,189,996 shares remaining reserved for issuance in connection with awards under the 2006 Plan. During fiscal year 2010, the Company granted options to purchase 624,566 shares to employees and directors with exercise prices between $9.05 and $13.96, and options to purchase 75,467 shares were forfeited. During fiscal year 2010, the Company granted 699,410 restricted shares to employees and directors at prices ranging from $9.05 to $13.96, and 45,026 restricted shares were forfeited. At September 30, 2010, there were 3,986,513 shares remaining reserved for issuance in connection with awards under the 2006 Plan. During fiscal year 2011, the Company granted options to purchase 321,072 shares to employees and directors with exercise prices between $14.30 and $17.02, and options to purchase 73,591 shares were forfeited. During fiscal year 2011, the Company granted 736,340 restricted shares to employees and directors at prices ranging from $12.88 to $25.52, and 150,112 restricted shares were forfeited. At September 30, 2011, there were 3,152,804 shares remaining reserved for issuance in connection with awards under the 2006 Plan. The maximum number of shares subject to options or stock appreciation rights that can be awarded under the 2006 Plan to any person is 1,000,000 per year. The maximum number of shares that can be awarded under the 2006 Plan to any person, other than pursuant to an option or stock appreciation right, is 700,000 per year. These shares and options generally vest over a period of one to four years conditioned on continued employment for the incentive period.

        The 2006 Plan permits the granting of options to purchase shares of common stock intended to qualify as incentive stock options under the Internal Revenue Code and stock options that do not qualify as incentive stock options ("non-qualified stock options"). The exercise price of each stock option may not be less than 100% of the fair market value of the common stock on the date of grant. However, if a grant recipient, who holds at least 10% of the common stock of the Company, receives an incentive stock option, the exercise price of such incentive stock option may not be less than 110% of the fair market value of the common stock on the date of grant. The term of each stock option is fixed by the compensation committee and may not exceed 10 years from the date of grant.

        The compensation committee may also award under the 2006 Plan:

  • restricted stock, which are shares of common stock subject to restrictions;

    stock units, which are common stock units subject to restrictions;

    dividend equivalent rights, which are rights entitling the recipient to receive credits for dividends that would be paid if the recipient had held a specified number of shares of common stock;

    stock appreciation rights, which are rights to receive a number of shares or, in the discretion of the compensation committee and subject to applicable law, an amount in cash or a combination of shares and cash, based on the increase in the fair market value of the shares underlying the right during a stated period specified by the compensation committee;

    unrestricted stock, which are shares of common stock granted without restrictions as a bonus; and
     
    performance and annual incentive awards, ultimately payable in common stock or cash, as determined by the compensation committee (the compensation committee may grant multi-year and annual incentive awards subject to achievement of specified goals tied to business criteria set forth in the 2006 Plan).
  • Share Repurchase Program

        On December 2, 2008, the Company's Board of Directors approved a $10.0 million share repurchase program. Under the program, the Company is authorized to repurchase the issued and outstanding shares of common stock. Share repurchases may be made through open market purchases, privately negotiated transactions or otherwise, at times and in such amounts as management deems appropriate. The timing and actual number of shares repurchased will depend on a variety of factors including price, corporate and regulatory requirements and other market conditions. The repurchase program may be discontinued or suspended at any time, and will be funded using our available cash. On February 2, 2010, the Company's Board of Directors approved an additional $10.0 million for the share repurchase program. On November 30, 2010, our Board of Directors approved an additional $10.0 million for the share repurchase program. On May 3, 2011, the Company's Board of Directors approved an additional $10.0 million for the share repurchase program. The Company's Board of Directors reviews the share repurchase program periodically, the last such review having occurred in May 2011. During the year ended September 30, 2009, 707,462 shares were purchased under the program for approximately $3,874,000. During the year ended September 30, 2010, 1,225,019 shares were purchased under the program for approximately $14,471,000. During the year ended September 30, 2011, 229,575 shares were purchased under the program for approximately $3,541,000. As of September 30, 2011, approximately $18,114,000 may yet be expended under the program.

  • Stock Option Activity

        A summary of the Company's stock option activity for the years ended September 30, 2011 and 2010 is as follows:

 
  Options   Weighted-
Average
Exercise Price
 

Options outstanding at September 30, 2009

    4,609,226   $ 10.95  

Options granted

    624,566     10.92  

Options exercised

    (411,036 )   7.88  

Options canceled

    (75,467 )   12.24  
             

Options outstanding at September 30, 2010

    4,747,289     11.20  

Options granted

    321,072     15.21  

Options exercised

    (2,100,223 )   11.26  

Options canceled

    (73,591 )   13.18  
             

Options outstanding at September 30, 2011

    2,894,547     11.55  
             

Options exercisable at September 30, 2011

    1,536,884     12.05  
             

        The following table summarizes information about options outstanding at September 30, 2011:

 
  Options Outstanding  
Range of Exercise Price
  Number Outstanding   Weighted-
Average
Remaining
Contractual Life
  Weighted-
Average
Exercise Price
 

$2.00 – 8.00

    456,090     6.99   $ 7.34  

$8.23 – $20.88

    2,438,457     6.99     12.33  
                   

 

    2,894,547     6.99     11.54  
                   

        Volatility rates from 40% – 72%, a dividend rate of 0%, risk free interest rates that ranged from 0.26% – 5.05% and a forfeiture rate of 19.0%,

        The intrinsic value of outstanding and exercisable options at September 30, 2011 is approximately $59,403,000 and $30,766,000, respectively, based on a stock price of $32.07 on September 30, 2011.

        The weighted average grant date fair value of options granted during 2011, 2010 and 2009 was $15.21, $4.02, and $3.51, respectively.

        The intrinsic value of options exercised at September 30, 2011, 2010, and 2009 was $43,706,000, $3,342,000, and $1,090,000, respectively.

  • Restricted Share Activity

        A summary of the Company's restricted share activity for the years ended September 30, 2011 and 2010 is as follows:

 
  Restricted
Shares
  Weighted-
Average
Fair Value
 

Unvested restricted shares at September 30, 2009

    462,836   $ 8.88  

Restricted shares granted

    699,410     10.00  

Restricted shares vested

    (144,053 )   8.47  

Restricted shares canceled

    (45,026 )   9.30  
             

Unvested restricted shares at September 30, 2010

    973,167     9.73  

Restricted shares granted

    736,340     16.20  

Restricted shares vested

    (265,313 )   9.77  

Restricted shares canceled

    (150,112 )   12.06  
             

Unvested restricted shares at September 30, 2011

    1,294,082     13.13  
             

        For the years ended September 30, 2011, 2010 and 2009, the Company recorded stock-based compensation of $9,136,000, $7,891,000 and $6,465,000, respectively. The total costs related to unvested awards, not yet recognized, as of September 30, 2011 was $19,068,000, which will be recognized over the weighted average vesting period of 29 months.