SHARE-BASED COMPENSATION

Our incentive plans permit the issuance of restricted stock and restricted stock unit awards (which we refer to as "restricted stock awards"), performance awards, stock appreciation rights and stock options. There are 1.9 million shares available for future grants at September 30, 2014. We deliver newly issued shares of common stock for restricted stock awards upon vesting or upon exercise of stock options.

Share-based compensation is recognized as an expense over the requisite service period on a straight-line basis. The total share-based compensation expense is based on the fair value of the award measured at the grant date.



	September 30,
(In thousands, except average service periods)	2014		2013		2012
Share-based compensation recognized	$	14,691	$	14,231	$	10,402
Unrecognized compensation cost, net of estimated forfeitures	16,478		19,898		19,483
Remaining weighted-average service period (years)	1.7		1.8		2.2

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 and 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.

The total fair value of stock options vested during fiscal years 2014, 2013 and 2012 was $2.8 million, $3.2 million and $2.5 million, respectively. Cash proceeds received for the exercise of options for the fiscal years 2014, 2013 and 2012 was $3.7 million, $9.2 million and $5.5 million, respectively. No stock options were granted during fiscal year 2014 or 2013. The weighted-average grant date fair value of stock options granted during fiscal year 2012 was $16.90 per share. For fiscal year 2012, we estimated the fair value of each stock option on the date of grant using the Black-Scholes pricing model and the following assumptions:



		Fiscal 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 determined expected volatility using a six-year historical volatility figure and determined the expected term of the stock options using 10 years of historical data. We have not historically paid dividends.

A summary of stock option activity for fiscal year 2014 is as follows:



	Number of Options (000s)		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)	Aggregate Intrinsic Value (000s)
Outstanding at October 1, 2013	989		$	33.21
Granted	—		—
Exercised	(125	)	29.44			$	2,637
Forfeited	(31	)	40.24
Outstanding at September 30, 2014	833		33.52		5.0	8,473
Exercisable at September 30, 2014	666		31.78		4.5	7,928

Restricted Stock

We have awarded restricted stock and restricted stock units 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, as set forth in the terms of the grant. Our restricted stock awards are subject to acceleration for change of control, retirement, death or disability. 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, such as change of control, 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. Our restricted stock holders have the right to receive dividend equivalents for restricted awards that vest for the dividends we will start paying in fiscal 2015. Recipients of restricted stock awards do not have the rights of a shareholder until shares of stock are issued to the recipient.

A summary of restricted stock activity for fiscal year 2014 is as follows:



	Number of Shares (000s)		Weighted Average Fair Value
Unvested at October 1, 2013	623		$	42.44
Granted	235		54.19
Vested	(175	)	38.04
Forfeited	(61	)	47.60
Unvested at September 30, 2014	622		47.62

Performance Units

We have made awards to certain employees that are subject to market-based performance conditions ("performance units"). All current awards of performance units are subject to a vesting and restriction period of three years. Our performance unit awards are subject to acceleration for change of control, retirement, death or disability. 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. The grant date fair value of the performance units we have granted was determined through use of the Monte Carlo simulation method. The grant date fair value per share for the performance units we granted in fiscal 2014, 2013 and 2012 was $53.55, $45.20 and $40.28, respectively. Our performance unit holders have the right to receive dividend equivalents for performance units that vest for the dividends we will start paying in fiscal 2015. Recipients of performance units do not have the rights of a shareholder until shares of stock are issued to the recipient.

A summary of performance unit stock activity for fiscal year 2014 is as follows:



	Number of Shares (000s)		Weighted Average Fair Value
Unvested at October 1, 2013	226		$	42.35
Granted	86		53.55
Vested	—		—
Forfeited	(48	)	43.10
Unvested at September 30, 2014	264		45.87