Energizer 2012 Annual Report Download - page 79

Download and view the complete annual report

Please find page 79 of the 2012 Energizer annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 124

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124

ENERGIZER HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in millions, except per share and percentage data)
CAGR for the three year period ending on September 30, 2013. Under the terms of the award, 100% of the grant vests if an
EPS CAGR of at least 12% is achieved, with smaller percentages vesting if the Company achieves an EPS CAGR between 5%
and 12%. In addition, the terms of the performance awards provide that the awards vest upon death, disability and in some
instances upon change of control. The total performance award expected to vest is being amortized over the vesting period.
In November 2010, the Company granted two RSE awards to executive officers. One grant includes approximately 47,900
shares and vests on the third anniversary of the date of grant or upon death, disability or change of control. The second grant
includes approximately 111,700 shares which vests on the date that the Company publicly releases its earnings for its 2013
fiscal year contingent upon the Company’s EPS CAGR for the three year period ending on September 30, 2013. Under the
terms of the award, 100% of the grant vests if an EPS CAGR of at least 12% is achieved, with smaller percentages vesting if
the Company achieves an EPS CAGR between 5% and 12%. In addition, the terms of the performance awards provide that the
awards vest upon death, disability and in some instances upon change of control. The total performance award expected to vest
is being amortized over the vesting period.
In November 2011, the Company granted RSE awards to certain employees which included approximately 310,000 shares that
in most cases vest ratably over four years or upon death, disability or change of control. At the same time, the Company granted
two RSE awards to key executives. One grant includes approximately 130,700 shares and vests on the third anniversary of the
date of grant or upon death, disability or change of control. The second grant includes approximately 305,000 shares which
vests on the date that the Company publicly releases its earnings for its 2014 fiscal year contingent upon the Company’s EPS
CAGR for the three year period ending on September 30, 2014. Under the terms of the award, 100% of the grant vests if an
EPS CAGR of at least 12% is achieved, with smaller percentages vesting if the Company achieves an EPS CAGR between 5%
and 12%. In addition, the terms of the performance awards provide that the awards vest upon death, disability and in some
instances upon change of control. The total performance award expected to vest is being amortized over the vesting period.
The Company records estimated expense for the performance based grants based on target achievement for the three year
period for each respective program unless evidence exists that a different ultimate EPS CAGR is likely to occur. The estimated
fair value of the award is determined using the closing share price of the Company's common stock on the date of the grant.
The following table summarizes RSE activity during the current year (shares in millions):
Shares
Weighted-Average
Grant Date
Estimated Fair
Valu e
Nonvested RSE at October 1, 2011 1.98 $ 69.86
Granted 0.76 70.26
Vested (0.45) 68.13
Canceled (0.33) 69.12
Nonvested RSE at September 30, 2012 1.96 $ 70.38
As of September 30, 2012, there was an estimated $48.4 of total unrecognized compensation costs related to RSE granted to
date, which will be recognized over a weighted-average period of approximately 1.3 years. The amount recognized may vary as
vesting for a portion of the awards depends on the achievement of the established EPS CAGR targets. The weighted-average
estimated fair value for RSE granted in fiscal 2012, 2011 and 2010 was $70.3, $74.9, and $65.6, respectively. The estimated
fair value of RSE vested in fiscal 2012, 2011 and 2010 was $29.3, $25.3, and $25.8, respectively.
(8) Pension Plans and Other Postretirement Benefits
The Company has several defined benefit pension plans covering substantially all of its employees in the U.S. and certain
employees in other countries. The plans provide retirement benefits based, in certain circumstances, on years of service and on
earnings.
In November 2012, which is the first fiscal quarter of 2013, the Company approved and communicated changes to its U.S.
pension plan, which is the most significant of the Company's pension obligations. Effective January 1, 2014, the pension
benefit earned to date by active participants under the legacy Energizer U.S. pension plan will be frozen and future service
benefits will no longer be accrued under this retirement program. It is expected that the Company will provide an enhanced
69