Share-Based Compensation

9 Months Ended

Jun. 30, 2012

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

Share-Based Compensation

SHARE-BASED COMPENSATION

Share-based compensation cost is measured at the grant date, based on the estimated fair value of the award, and is recognized as an expense over the requisite service period, which is generally the vesting period of the equity award. As of June 30, 2012, unrecognized compensation cost, net of estimated forfeitures, related to stock options and restricted stock awards was approximately $7.1 million and $14.8 million, respectively, which we expect to recognize over a weighted average period of approximately 2.4 years.

Stock Options

Under our stock incentive plans, the exercise price of each stock option must be equal to or greater than the fair market value of our common stock on the date of grant, with all outstanding options having a maximum term of 10 years. Options vest ratably over a period from the end of the first to the fourth year from the date of grant. Each option is for the purchase of one share of our common stock.

The per share weighted average fair value of stock options granted during the nine months ended June 30, 2012 was $16.90. We estimated the fair value of each stock option then outstanding using the Black-Scholes pricing model and the following assumptions for the nine months ended June 30, 2012:

Risk-Free Interest Rate	0.9	%
Expected Volatility	44	%
Expected Life (Years)	5.4
Dividend Yield	None

The average risk-free interest rate is based on the five-year U.S. treasury security rate in effect as of the grant date. We estimated expected volatility using six-year historical volatility and estimated the expected term of the stock options using historical data for the last ten years. We have never paid any cash dividends on our common stock.

A summary of stock option activity during the nine months ended June 30, 2012 is as follows:

	Number of Options (000s)	Wtd. Avg. Exercise Price		Wtd. Avg. Remaining Contractual Life (Years)	Aggregate Intrinsic Value (000s)
Outstanding at September 30, 2011	1,480	$	25.44	6.1	$	13,198
Granted	320	$	41.60
Exercised	(196)	$	16.72		$	5,828
Forfeited	(59)	$	36.34
Outstanding at June 30, 2012	1,545	$	29.48	6.3	$	12,934
Exercisable at June 30, 2012	950	$	24.03	4.9	$	13,117

Restricted Stock

We have awarded restricted stock under the 2007 Plan to certain employees and to our non-employee directors. All current awards of restricted stock to employees are subject to a vesting and restriction period ranging from three to four years, subject to early termination as provided in the 2007 Plan. In addition, certain awards of restricted stock are subject to market conditions. All awards of restricted stock to non-employee directors are subject to a vesting and restriction period of a minimum of 13 months, subject to early termination as provided in the 2007 Plan. We value restricted stock awards based on the fair market value of our common stock on the date of grant and also adjust fair market value for any awards subject to market conditions, where applicable.

A summary of restricted stock activity for the nine months ended June 30, 2012 is as follows:

	Number of Shares (000s)	Wtd. Avg. Fair Value
Unvested at September 30, 2011	560	$	34.54
Granted	391	$	41.36
Vested	(207)	$	33.07
Forfeited	(41)	$	38.49
Unvested at June 30, 2012	703	$	38.54