Johnson Controls 2013 Annual Report Download - page 84

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84
The assumptions used to determine the fair value of the SAR awards at September 30, 2013 were as follows:
Expected life of SAR (years) 0.05 - 3.3
Risk-free interest rate 0.02% - 0.74%
Expected volatility of the Company’s stock 41.00%
Expected dividend yield on the Company’s stock 2.03%
A summary of SAR activity at September 30, 2013, and changes for the year then ended, is presented below:
Weighted
Average
SAR Price
Shares
Subject to
SAR
Weighted
Average
Remaining
Contractual
Life (years)
Aggregate
Intrinsic
Value
(in millions)
Outstanding, September 30, 2012 $ 26.93 3,775,878
Granted 27.85 1,018,650
Exercised 23.67 (923,570)
Forfeited or expired 28.42 (126,167)
Outstanding, September 30, 2013 $ 27.94 3,744,791 6.3 $ 51
Exercisable, September 30, 2013 $ 27.44 1,884,356 4.3 $ 27
In conjunction with the exercise of SARs granted, the Company made payments of $11 million, $2 million and $4 million during
the fiscal years ended September 30, 2013, 2012 and 2011, respectively.
Restricted (Nonvested) Stock
The 2012 Plan provides for the award of restricted stock or restricted stock units to certain key employees. These awards are
typically share settled unless the employee is a non-U.S. employee or elects to defer settlement until retirement at which point the
award would be settled in cash. Restricted awards typically vest 50% after two years from the grant date and 50% after four years
from the grant date. The 2012 Plan allows for different vesting terms on specific grants with approval by the Board of Directors.
A summary of the status of the Company’s nonvested restricted stock awards at September 30, 2013, and changes for the fiscal
year then ended, is presented below:
Weighted
Average
Price
Shares/Units
Subject to
Restriction
Nonvested, September 30, 2012 $ 30.46 997,059
Granted 30.14 515,700
Vested 36.85 (233,150)
Forfeited 28.74 (37,750)
Nonvested, September 30, 2013 $ 29.18 1,241,859
At September 30, 2013, the Company had approximately $16 million of total unrecognized compensation cost related to nonvested
restricted stock arrangements granted. That cost is expected to be recognized over a weighted-average period of 2.7 years.
Performance Share Awards
The 2012 Plan permits the grant of performance-based share unit ("PSU") awards. The number of PSUs granted is equal to the
PSU award value divided by the closing price of the Company's common stock at the grant date. The PSUs are generally contingent
on the achievement of pre-determined performance goals over a three-year performance period as well as on the award holder's
continuous employment until the vesting date. Each PSU that is earned will be settled with a share of the Company's common
stock following the completion of the performance period, unless the award holder elected to defer a portion or all of the award
until retirement which would then be settled in cash.