Energizer 2013 Annual Report Download - page 82

ENERGIZER HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in millions, except per share)
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 and potential pro rata vesting for retirement based on age and service requirements. The total
performance award expected to vest is being amortized over the vesting period.
In December 2012, the Company granted RSE awards to a group of key employees which included approximately 188,300
shares that vest ratably over four years or upon death or change of control. At the same time, the Company granted two RSE
awards to a group of key executives. One grant includes approximately 94,100 shares and vests, in most cases, on the third
anniversary of the date of grant or upon death or change of control. The second grant includes approximately 205,600 shares,
which vests on the date that the Company publicly releases its earnings for its 2015 fiscal year, contingent upon achievement of
performance targets with respect to adjusted cumulative earnings before interest taxes depreciation and amortization (EBITDA)
and adjusted return on invested capital, weighted equally, and subject to adjustment based on relative total shareholder return
during the three year performance period based on a relevant group of industrial and consumer goods companies. In addition,
the terms of the performance awards provide that the awards vest upon death and in some instances upon change of control and
potential pro rata vesting for retirement based on age and service requirements. The total performance awards expected to vest
will be amortized over the vesting period. The closing stock price on the date of the grant used to determine the award
estimated fair value was $81.45. The awards that are contingent upon achievement of performance targets have a 7% fair value
premium to the closing stock price on the date of the grant based on a simulation of outcomes under the relative total
shareholders' return metric required by the Accounting Standards Codification ("ASC") section 718.
In November 2013, which is fiscal 2014, the Company granted RSE awards to a group of key employees which included
approximately 179,800 shares that vest ratably over four years or upon death or change of control. At the same time, the
Company granted two RSE awards to a group of key executives. One grant includes approximately 39,800 shares and vests, in
most cases, on the third anniversary of the date of grant or upon death or change of control. The second grant includes
approximately 238,600 shares, which vests on the date that the Company publicly releases its earnings for its 2016 fiscal year,
contingent upon achievement of performance targets with respect to adjusted cumulative earnings before interest taxes
depreciation and amortization (EBITDA) and adjusted return on invested capital, weighted equally, and subject to adjustment
based on relative total shareholder return during the three year performance period based on a relevant group of industrial and
consumer goods companies. In addition, the terms of the performance awards provide that the awards vest upon death and in
some instances upon change of control and potential pro rata vesting for retirement based on age and service requirements. The
total performance awards expected to vest will be amortized over the vesting period. The closing stock price on the date of the
grant used to determine the award estimated fair value was $101.56. The awards that are contingent upon achievement of
performance targets will have a fair value premium added or subtracted to the closing stock price on the date of the grant based
on a simulation of outcomes under the relative total shareholders' return metric required by the Accounting Standards
Codification ("ASC") section 718.
The Company records estimated expense for the performance based grants based on target achievement of performance metrics
for the three year period for each respective program unless evidence exists that achievement above or below target for the
applicable performance metric is more 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 fiscal year (shares in millions):
Shares
Weighted-Average
Grant Date
Estimated Fair
Value
Nonvested RSE at October 1, 2012 1.96 $70.38
Granted 0.50 84.33
Vested (0.62) 67.92
Canceled (0.20) 69.10
Nonvested RSE at September 30, 2013 1.64 $75.75
As of September 30, 2013, there was an estimated $47.8 of total unrecognized compensation costs related to RSE granted to
date, which will be recognized over a weighted-average period of approximately 1.1 years. The amount recognized may vary as
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