Note 13 - Stock-Based Compensation and Purchase Plans

12 Months Ended

Jun. 30, 2014

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

13. STOCK-BASED COMPENSATION AND PURCHASE PLANS

Stock-Based Compensation Plans

Under incentive compensation plans, the Company is authorized to make grants of stock options, restricted stock and performance share units to provide equity incentive compensation to key employees and directors. In fiscal 2004, the Company began granting stock awards instead of stock options. The stock award program offers employees and directors the opportunity to earn shares of our stock over time, rather than options that give the employees and directors the right to purchase stock at a set price. The Company has stock plans for directors, officers and certain key employees.

Total compensation cost recognized in income for equity based compensation awards was $6.6 million, $3.3 million, and $3.8 million for the years ended June 30, 2014, 2013 and 2012, respectively, primarily within Selling, General, and Administrative Expenses. The total income tax benefit recognized in the consolidated statement of operations for equity-based compensation plans was $2.3 million, $1.2 million, and $1.3 million for the years ended June 30, 2014, 2013 and 2012, respectively.

458,513 shares of common stock were reserved for issuance under various compensation plans at June 30, 2014.

Restricted Stock Awards

The Company may award shares of restricted stock to eligible employees and non-employee directors of the Company at no cost, giving them in most instances all of the rights of stockholders, except that they may not sell, assign, pledge or otherwise encumber such shares and rights during the restriction period. Such shares and rights are subject to forfeiture if certain employment conditions are not met. During the restriction period, recipients of the shares are entitled to dividend equivalents on such shares, providing that such shares are not forfeited. Dividends are accumulated and paid out at the end of the restriction period. During 2014, 2013 and 2012, the Company granted 62,698, 44,388, and 52,884 shares, respectively, of restricted stock to eligible participants. Restrictions on the stock awards generally lapse between fiscal 2015 and fiscal 2017. For the years ended June 30, 2014, 2013 and 2012, $3.3 million, $1.5 million, and $1.4 million, respectively, was recognized as compensation expense related to restricted stock awards. Substantially all awards are expected to vest.

A summary of restricted stock awards activity during the year ended June 30, 2014 is as follows:

	Restricted Stock Awards
	Number			Aggregate
	of			Intrinsic
	Shares			Value
Outstanding, June 30, 2013		172,490		$	9,098,848
Granted		62,698
Exercised / vested		(88,826	)		4,932,618
Canceled		(2,267	)
Outstanding, June 30, 2014		144,095		$	10,732,196

Performance stock units during 2014, 2013 and 2012 had a weighted average grant date fair value of $58.84, $44.59, and $29.05, respectively. The grant date fair value of restricted stock awards is determined based on the closing price of the Company’s common stock on the date of grant. The total intrinsic value of awards exercised during the years ended June 30, 2014, 2013, and 2012 was $3.1 million, $3.5 million, and $2.4 million, respectively.

As of June 30, 2014, there was $2.4 million of unrecognized compensation costs related to awards expected to be recognized over a weighted-average period of 1.22 years.

Executive Compensation Program

The Company operates a compensation program for key employees. The plan contains both an annual component as well as long-term component. Under the annual component, participants may elect to defer up to 50% of their annual incentive compensation in restricted stock which is purchased at a discount to the market. Additionally, non-employee directors of the Company may defer a portion of their director’s fees in restricted stock units which is purchased at a discount to the market. During the restriction period, recipients of the shares are entitled to dividend equivalents on such units, providing that such shares are not forfeited. Dividend equivalents are accumulated and paid out at the end of the restriction period. The restrictions on the units expire after three years. At June 30, 2014 and 2013 respectively, 52,431 and 105,967 shares of restricted stock units are outstanding and subject to restrictions that lapse between fiscal 2014 and fiscal 2016. The compensation expense associated with this incentive program is charged to income over the restriction period. The Company recorded compensation expense related to this program of $0.7 million, $0.6 million, and $0.4 million for the years ended June 30, 2014, 2013 and 2012, respectively.

As of June 30, 2014, there was $0.2 million of unrecognized compensation costs related to awards expected to be recognized over a weighted-average period of 1.00 years

The fair value of the awards under the annual component of this incentive program is measured using the Black-Scholes option-pricing model. Key assumptions used to apply this pricing model are as follows:

	2014			2013			2012
Risk-free interest rates		0.70	%		0.25	%		0.25	%
Expected life of option grants (in years)		3			3			3
Expected volatility of underlying stock		38.9	%		47.4	%		63.2	%
Expected quarterly dividends (per share)	$	0.08		$	0.07		$	0.06

Under the long-term component, grants of performance share units (“PSUs”) are made annually to key employees and the share units are earned based on the achievement of certain overall corporate financial performance targets over the performance period. At the end of the performance period, the number of shares of common stock issued will be determined by adjusting upward or downward from the target in a range between 50% and 200%. No shares will be issued if the minimum performance threshold is not achieved. The final performance percentage, on which the payout will be based, considering the performance metrics established for the performance period, will be certified by the Compensation Committee of the Board of Directors.

The awards granted by the Committee provided that the PSUs will be converted to shares of common stock if the Company’s EBITDA (earnings before interest, taxes, depreciation and amortization) and return on assets meet specified levels approved by the Committee. A participant’s right to any shares that are earned will vest in three equal installments. An executive whose employment terminates prior to the vesting of any installment for a reason other than death, disability, retirement, or following a change in control, will forfeit the shares represented by that installment. In certain circumstances, such as death, disability, or retirement, PSUs are paid on a pro-rata basis. In the event of a change in control, vesting of the awards granted is accelerated.

A summary of the awards activity under the executive compensation program during the year ended June 30, 2014 is as follows:

	Annual Component							Performance Stock Units
				Weighted
	Number			Average		Aggregate		Number			Aggregate
	of			Exercise		Intrinsic		of			Intrinsic
	Shares			Price		Value		Shares			Value
Non-vested, June 30, 2013		105,967		$	23.68	$	1,683,260		41,003		$	2,162,926
Granted		15,608			39.56				87,220
Vested		(68,504	)		22.49		2,308,140		(58,584	)		2,386,361
Forfeited		(639	)		28.78				(29,273	)
Non-vested, June 30, 2014		52,432		$	29.91	$	1,360,566		40,366		$	2,156,759

Restricted stock awards granted under the annual component of this program in fiscal 2014, 2013, and 2012 had a grant date fair value of $69.47, $55.61, and $40.78, respectively. The PSUs granted in fiscal 2014, 2013 and 2012 had a grant date fair value of $54.48, $44.20, and $26.60, respectively. The total intrinsic value of awards vested under the executive compensation program during the years ended June 30, 2014, 2013 and 2012 was $2.2 million, $3.1 million, and $5.4 million, respectively.

The Company recognized compensation expense related to the PSUs of $2.7 million, $1.3 million, and $2.1 million for the years ended June 30, 2014, 2013 and 2012, respectively. The total unrecognized compensation costs related to non-vested performance share units was $1.3 million at June 30, 2014, which is expected to be recognized over a weighted average period of 1.90 years.

Employee Stock Purchase Plan

The Company has an Employee Stock Purchase Plan that allows employees to purchase shares of common stock of the Company at a discount from the market each quarter. Shares of our stock may be purchased by employees quarterly at 95% of the fair market value on the last day of each quarter. Shares of stock reserved for the plan were 97,890 at June 30, 2014. Shares purchased under this plan aggregated 4,473, 5,813, and 9,185 in 2014, 2013 and 2012, respectively, at an average price of $58.54, $48.16, and $34.48, respectively.