XML 68 R13.htm IDEA: XBRL DOCUMENT
v2.4.0.6

Stock-Based Compensation Plans | 12 Months Ended
--- | ---
Sep. 30, 2012
Stock-Based Compensation Plans [Abstract] |
Stock-Based Compensation Plans |
6. | Stock-Based Compensation Plans
The Company has stock-based compensation plans under which it grants stock options, restricted stock awards and performance share awards. Accounting guidance requires all share-based payments to be recognized as an operating expense, based on their fair values, over the requisite service period. The Company’s stock-based compensation expenses for the years ended September 30 were allocated to the following expense categories (in thousands):
|  | 2012 |  |  | 2011 |  |  | 2010 |
Product costs |  | $ | 35 |  |  | $ | 79 |  |  | $ | 60 |
Research and development |  |  | 511 |  |  |  | 1,156 |  |  |  | 2,466 |
Selling, general and administrative |  |  | 2,125 |  |  |  | 2,415 |  |  |  | 2,061 |
Total continuing operations |  |  | 2,671 |  |  |  | 3,650 |  |  |  | 4,587 |
Discontinued operations |  |  | 62 |  |  |  | 602 |  |  |  | 1,288 |
Total stock-based compensation expense |  | $ | 2,733 |  |  | $ | 4,252 |  |  | $ | 5,875 |
As of September 30, 2012, approximately $2.9 million of total unrecognized compensation costs related to non-vested awards is expected to be recognized over a weighted average period of approximately 2.7 years. The unrecognized compensation costs include $0.8 million associated with performance share awards that are currently anticipated to be fully expensed because the performance conditions are expected to be met. Stock Option Plans The Company uses the Black-Scholes option pricing model to determine the weighted average grant date fair value of stock options granted. The weighted average per share fair values of stock options granted during fiscal 2012, 2011 and 2010 were $5.26, $3.96, and $6.78, respectively. The assumptions used as inputs in the model for the years ended September 30 were as follows:
|  | 2012 |  |  | 2011 |  |  | 2010 |
Risk-free interest rates |  |  | 0.82 | % |  |  | 1.45 | % |  |  | 1.95 | %
Expected life |  |  | 4.8 years |  |  |  | 4.8 years |  |  |  | 4.8 years |
Expected volatility |  |  | 50 | % |  |  | 45 | % |  |  | 41 | %
Dividend yield |  |  | 0 | % |  |  | 0 | % |  |  | 0 | %
The risk-free interest rate assumption was based on the U.S. Treasury’s rates for U.S. Treasury zero-coupon bonds with maturities similar to those of the expected term of the award. The expected life of options granted is determined based on the Company’s experience. Expected volatility is based on the Company’s stock price movement over a period approximating the expected term. Based on management’s judgment, dividend rates are expected to be zero for the expected life of the options. The Company also estimates forfeitures of options granted, which are based on historical experience. The Company’s Incentive Stock Options (“ISO”) are granted at a price of at least 100% of the fair market value of the common stock of the Company on the date of the grant or 110% with respect to optionees who own more than 10% of the total combined voting power of all classes of stock. ISOs generally expire in seven years or upon termination of employment and generally are exercisable at a rate of 20% per year commencing one year after the date of grant. Non-qualified stock options are granted at fair market value on the date of grant. Non-qualified stock options expire in seven to ten years or upon termination of employment or service as a Board member. Non-qualified stock options granted prior to May 2008 generally become exercisable with respect to 20% of the shares on each of the first five anniversaries following the grant date, and non-qualified stock options granted subsequent to April 2008 generally become exercisable with respect to 25% of the shares on each of the first four anniversaries following the grant date. Shareholders approved the 2009 Equity Incentive Plan (“2009 Plan”) at the February 8, 2010 Annual Meeting of Shareholders. The 2009 Plan has 1,500,000 shares authorized, plus the number of shares that have not yet been awarded under the 2003 Equity Incentive Plan, or were awarded and subsequently returned to the pool of available shares under the 2003 Equity Incentive Plan pursuant to its terms. At September 30, 2012, there were 1,448,000 shares available for future awards. As of September 30, 2012, the aggregate intrinsic value of the option shares outstanding and option shares exercisable was $6.2 million and $1.0 million, respectively. At September 30, 2012, the average remaining contractual life of options outstanding and options exercisable was 4.3 and 3.2 years, respectively. The total pre-tax intrinsic value of options exercised during fiscal 2012 was $0.1 million. The intrinsic value represents the difference between the exercise price and the fair market value of the Company’s common stock on the last day of the respective fiscal period end. There were no stock options exercised in fiscal 2011. There was no intrinsic value associated with options exercised during fiscal 2010 as the Company’s stock price of $11.92 per share on September 30, 2010 was below the value of options exercised. The following table summarizes all stock options activity and stock options outstanding and exercisable under the stock option plans during fiscal 2012, 2011 and 2010:
|  | Number of Shares |  |  | Weighted Average Exercise Price |
Outstanding at September 30, 2009 |  |  | 1,669,570 |  |  | $ | 32.82 |
Granted |  |  | 388,635 |  |  |  | 22.88 |
Exercised |  |  | (20,350 | ) |  |  | 20.74 |
Forfeited |  |  | (545,534 | ) |  |  | 30.58 |
Outstanding at September 30, 2010 |  |  | 1,492,321 |  |  | $ | 31.22 |
Granted |  |  | 551,773 |  |  |  | 9.96 |
Exercised |  |  | — |  |  |  | — |
Forfeited |  |  | (528,906 | ) |  |  | 25.15 |
Outstanding at September 30, 2011 |  |  | 1,515,188 |  |  | $ | 25.59 |
Granted |  |  | 299,832 |  |  |  | 12.46 |
Exercised |  |  | (11,379 | ) |  |  | 10.03 |
Forfeited |  |  | (478,203 | ) |  |  | 29.76 |
Outstanding at September 30, 2012 |  |  | 1,325,438 |  |  | $ | 21.25 |
Exercisable at September 30, 2012 |  |  | 661,006 |  |  | $ | 29.67 |
The table above includes stock options activity related to discontinued operations, however, there were no stock options outstanding or exercisable related to discontinued operations as of September 30, 2012. Restricted Stock Awards The Company has entered into restricted stock agreements with certain key employees, covering the issuance of common stock (“Restricted Stock”). Under accounting guidance these shares are considered to be non-vested shares. The Restricted Stock is released to the key employees if they are employed by the Company at the end of the vesting period. Compensation has been recognized for the estimated fair value of the common shares and is being charged to income over the vesting term. The stock-based compensation table above includes Restricted Stock expenses recognized related to these awards, which totaled $0.2 million, $0.6 million and less than $0.1 million during fiscal 2012, 2011 and 2010, respectively. The following table summarizes all restricted stock awards activity during fiscal 2012, 2011 and 2010:
|  | Number of Shares |  |  | Weighted Average Grant Price |
Balance at September 30, 2009 |  |  | 100,895 |  |  | $ | 35.80 |
Granted |  |  | 30,440 |  |  |  | 18.49 |
Vested |  |  | (83,195 | ) |  |  | 36.32 |
Forfeited |  |  | (7,068 | ) |  |  | 33.39 |
Balance at September 30, 2010 |  |  | 41,072 |  |  | $ | 22.33 |
Granted |  |  | 66,533 |  |  |  | 10.01 |
Vested |  |  | (23,978 | ) |  |  | 19.38 |
Forfeited |  |  | (11,000 | ) |  |  | 20.79 |
Balance at September 30, 2011 |  |  | 72,627 |  |  | $ | 12.25 |
Vested |  |  | (67,627 | ) |  |  | 11.52 |
Forfeited |  |  | (1,000 | ) |  |  | 22.35 |
Balance at September 30, 2012 |  |  | 4,000 |  |  | $ | 22.11 |
The table above includes restricted stock awards activity related to discontinued operations, however, there were no restricted stock awards outstanding related to discontinued operations as of September 30, 2012. Performance Share Awards The Company has entered into performance share agreements with certain key employees, covering the issuance of common stock (“Performance Shares”). The Performance Shares vest upon the achievement of all or a portion of certain performance objectives, which must be achieved during the performance period. Performance objectives selected by the Organization and Compensation Committee of the Board of Directors (the “Committee”) were cumulative earnings per share and cumulative revenue for the three-year performance periods beginning on October 1, 2010 and ending on September 30, 2013 and beginning on October 1, 2011 and ending on September 30, 2014. Shares will be issued to participants as soon as practicable following the end of the performance periods subject to Committee approval and verification of results. The compensation cost related to the number of shares to be granted under each performance period is fixed on the grant date, which is the date the performance period begins. Compensation is recognized in each period based on management’s best estimate of the achievement level of the grants’ specified performance objectives and the resulting vesting amounts. In fiscal 2012, the Company recognized expense of $1.0 million related to likely achievement of performance objectives for three-year Performance Shares granted in fiscal 2012 (62,497 shares) and fiscal 2011 (68,533 shares). In fiscal 2011, the Company recognized expense of $0.2 million related to 68,533 three-year Performance Shares awarded in fiscal 2011. In fiscal 2010, the Company recognized expense of less than $0.1 million related to specific performance objectives achieved by certain individuals. The Company did not recognize any expense in fiscal 2012, 2011 or 2010 related to three-year Performance Shares granted in fiscal 2010 (4,373 shares) as the performance objectives were not met. The stock-based compensation table above includes the Performance Shares expenses. The fair values of the Performance Shares, at target, were $0.8 million and $0.7 million for grants awarded in fiscal 2012 and 2011, respectively. The aggregate number of shares that could be awarded to key employees if the minimum, target and maximum performance goals are met, based upon the fair value at the date of grant is as follows:
Performance Period |  | Minimum Shares |  |  | Target Shares |  |  | Maximum Shares |
Fiscal 2011 — 2013 |  |  | 13,707 |  |  |  | 68,533 |  |  |  | 137,066 |
Fiscal 2012 — 2014 |  |  | 12,499 |  |  |  | 62,497 |  |  |  | 124,994 |
1999 Employee Stock Purchase Plan Under the 1999 Employee Stock Purchase Plan (“Stock Purchase Plan”), the Company is authorized to issue up to 400,000 shares of common stock. All full-time and part-time employees can choose to have up to 10% of their annual compensation withheld, with a limit of $25,000, to purchase the Company’s common stock at purchase prices defined within the provisions of the Stock Purchase Plan. As of September 30, 2012 and 2011, there were less than $0.1 million of employee contributions in each period included in accrued liabilities in the consolidated balance sheets. Stock compensation expense recognized related to the Stock Purchase Plan totaled less than $0.1 million, $0.1 million and $0.2 million, during fiscal 2012, 2011 and 2010, respectively. The stock-based compensation table above includes the Stock Purchase Plan expenses.

X
- Details
Name: | us-gaap_DisclosureOfCompensationRelatedCostsSharebasedPaymentsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Staff Accounting Bulletin (SAB) -Number Topic 14 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5070-113901 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 50 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6406099&loc=d3e25284-112666 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5047-113901 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher AICPA -Name Statement of Position (SOP) -Number 93-6 -Paragraph 53 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 40 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6418621&loc=d3e17540-113929 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 123R -Paragraph 64, 65, A240 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5444-113901 + Details
Name: | us-gaap_DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration