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Share-Based Compensation
9 Months Ended
May 31, 2012
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Share-based compensation
NOTE 12 — SHARE-BASED COMPENSATION
The Company recognizes share-based compensation at fair value in the financial statements. The fair value of each share-based award is estimated at the date of grant using either the Black-Scholes pricing model or a binomial model. Total compensation cost is amortized over the requisite service period using the accelerated method of amortization for grants with graded vesting or using the straight-line method for grants with cliff vesting. The Company recognized share-based compensation of $3.2 million and $9.2 million for the three and nine months ended May 31, 2012 and 2011, respectively, as a component of selling, general and administrative expenses. At May 31, 2012, the Company had $26.6 million of total unrecognized pre-tax compensation cost related to non-vested share-based compensation arrangements. The change in total unrecognized pre-tax compensation from August 31, 2011 relates to $24.0 million of grants during the year reduced by amortization and an adjustment for lower expected achievement of performance awards. This cost is expected to be recognized over approximately three years.
Combined information for shares subject to options and stock appreciation rights (“SARs”), excluding the cash component, for the nine months ended May 31, 2012 was as follows: 
 
Number
 
Weighted
Average
Exercise
Price
 
Weighted
Average
Remaining
Contractual Life
(Years)
Outstanding at September 1, 2011
2,807,498

 
$
27.45

 

Granted
828,463

 
11.63

 

Exercised
(80,210
)
 
12.43

 

Forfeited/Expired
(213,566
)
 
30.36

 

Outstanding at May 31, 2012
3,342,185

 
$
23.71

 
3.2

Exercisable at May 31, 2012
2,477,927

 
$
27.82

 
2.1



Information for restricted stock awards and performance-based restricted units (“PSUs”), excluding the cash component, for the nine months ended May 31, 2012 was as follows: 
 
Number
 
Weighted Average
Grant-Date
Fair Value
Outstanding at September 1, 2011
2,394,140

 
$
13.44

Granted
467,118

 
10.64

Vested
(286,649
)
 
14.65

Forfeited
(392,024
)
 
10.34

Outstanding at May 31, 2012
2,182,585

 
$
13.24



During the first quarter of 2012, the Compensation Committee (the “Committee”) of the Company’s Board of Directors approved a grant of restricted stock units (“RSUs”), SARs and PSUs to employees. The PSUs will vest upon the achievement of certain target levels of the performance goals and objectives of the Company over the performance period of approximately three years. The actual number of PSUs granted will be based on the level of achievement. Upon achievement of any of the performance goals, the awards will be paid out in cash. Additionally, a portion of the RSUs and SARs will be settled in cash. The Company accounts for the cash component of stock awards as a liability award and the liability is adjusted at each reporting period based on the share price of the Company’s common stock.