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The
pro forma amounts and fair value of each option grant is estimated
on the date of grant using the Black-Scholes option pricing model
with the following weighted-average assumptions used for grants
in 1999, 1998 and 1997: risk free interest rates of 4.79%, 5.55%,
and 6.51%, respectively; expected dividend yields of 1.09%, 1.28%,
and 1.42%, respectively; expected volatility of 31.0%, 24.4%, and
18.0%, respectively; and expected lives of 6 years for each year
presented.
Other
Stock Plans
The
Company has a compensatory Stock Award Plan which allows for grants
of common shares to certain key employees. Distribution of 25% or
more of each award, as elected by the grantee, is deferred until
after retirement or involuntary termination. Commencing on the first
anniversary of a grant following retirement, the remainder is distributable
in five equal annual installments. During 1999, 104,448 shares were
distributed. No awards were granted in 1999, 1998 or 1997. At September
30, 1999, 2,532,816 shares were reserved for future issuance, of
which awards for 431,428 shares have been granted.
The
Company has a compensatory Restricted Stock Plan for Non-Employee
Directors which reserves for issuance 300,000 shares of the Company’s
common stock. In 1997, 1,560 restricted shares were issued in accordance
with the provisions of the plan. No restricted shares were issued
in 1999 or 1998.
In
November 1996, in connection with the discontinuation of pension
benefits that otherwise would have been accrued and provided to
directors of the Company, the Company established the 1996 Directors’
Deferral Plan. This Plan allowed members of the Board of Directors
to defer receipt of the lump sum present value of all their accrued
and unpaid past service pension benefits as of December 1, 1996,
in the form of shares of the Company’s common stock or cash. In
addition, the Plan provides a means to defer director compensation,
from time to time, on a deferred stock or cash basis. As of September
30, 1999, 138,003 shares were held in trust, of which 11,373 shares
represented Directors’ compensation in 1999, in accordance with
the provisions of the Plan. Under the Plan, which is unfunded, directors
have an unsecured contractual commitment from the Company to pay
directors the amounts due to them under the Plan.
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For
the years ended September 30, 1999, 1998, and 1997, the following
table sets forth the computations of basic and diluted earnings
per share, restated to reflect the 1998 two-for-one stock split
(shares in thousands):
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