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Share-Based Compensation
 9 Months Ended
Jun. 30, 2013
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 calculated 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, 2013, unrecognized compensation cost, net of estimated forfeitures, related to stock options and restricted stock awards was approximately $4.3 million and $18.7 million, respectively, which we expect to recognize over a weighted average period of approximately 2.0 years.

On December 7, 2012, our Board of Directors adopted, and our shareholders subsequently approved on February 14, 2013, the Atwood Oceanics, Inc. 2013 Long-Term Incentive Plan (the "2013 Plan"). Under the 2013 Plan, up to 2,200,000 shares of common stock were authorized for issuance to eligible participants in the form of restricted stock and restricted stock unit awards (which we refer to as "restricted stock awards") or upon exercise of stock options granted pursuant to the 2013 Plan. We also maintain two other stock incentive plans, the Atwood Oceanics, Inc. Amended and Restated 2007 Long-Term Incentive Plan (as amended, the “2007 Plan”) and the Atwood Oceanics, Inc. Amended and Restated 2001 Stock Incentive Plan (as amended, the “2001 Plan”). Up to 4,000,000 shares of common stock were authorized for issuance under each of the 2007 Plan and the 2001 Plan to eligible participants in the form of restricted stock awards or upon exercise of stock options granted. No additional awards of any kind have or will be made under the 2007 Plan as a result of the implementation of the 2013 Plan. Likewise, no additional awards of any kind were made under the 2001 Plan since the implementation of the 2007 Plan. All stock incentive plans currently in effect have been approved by our shareholders.

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 one share 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 ranging from the end of the first to the fourth year from the date of grant for stock options. Each option is for the purchase of one share of our common stock.

A summary of stock option activity during the nine months ended June 30, 2013 is as follows:
 
 
Number of Options (000s)
 
Wtd. Avg. Exercise Price
 
Wtd. Avg. Remaining Contractual Life (Years)
 
Aggregate Intrinsic Value (000s)
Outstanding at October 1, 2012
1,450

 
$
29.74

 
6.1
 
$
22,663

Granted
—

 
$
—

 
 
 
 
Exercised
(338)

 
$
19.08

 
 
 
$
11,546

Forfeited
(20)

 
$
39.31

 
 
 
 
Outstanding at June 30, 2013
1,092

 
$
32.81

 
6.1
 
$
21,022

Exercisable at June 30, 2013
726

 
$
29.33

 
5.2
 
$
16,487



Restricted Stock

We have awarded restricted stock 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 acceleration upon certain events as set forth in the terms of the grant. In addition, certain awards of restricted stock to employees are subject to market-based performance conditions. The number of shares that vest based on market-based performance conditions will depend on the degree of achievement of specified corporate performance criteria which are strictly market-based. 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 acceleration upon certain events as set forth in the terms of the grant. We value restricted stock awards based on the fair market value of our common stock on the date of grant and also adjust to fair market value for any awards subject to market-based performance conditions, where applicable.

A summary of restricted stock activity for the nine months ended June 30, 2013 is as follows:
 
 
Number of Shares (000s)
 
Wtd. Avg. Fair Value
Unvested at October 1, 2012
701
 
$
38.54

Granted
347
 
$
46.69

Vested
(162)
 
$
35.49

Forfeited
(27)
 
$
41.82

Unvested at June 30, 2013
859
 
$
42.31