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The remaining weighted-average contractual term of
nonvested restricted shares at May 31, 2007 is the same as the
period over which the remaining cost of the awards will be
recognized, which is approximately 2.1 years. The fair value of
the nonvested restricted share awards have been calculated
using the market value of the shares on the date of issuance.
For the years ended May 31, 2007, 2006 and 2005, the
weighted-average grant date fair value for restricted share
grants was $18.78, $17.76 and $17.24, respectively. The total
fair value of shares vested during the years ended May 31,
2007, 2006 and 2005 was $0.8 million, $0.5 million and
$0.2 million, respectively. We anticipate that approximately
1.6 million shares at a weighted-average grant-date fair value
of $15.84 and a weighted-average remaining contractual term
of 2.1 years will ultimately vest, based upon the unique terms
and participants of each plan. Approximately 3,471 shares of
restricted stock were vested at June 1, 2006, with 23,139
restricted shares vested as of May 31, 2007. The total intrinsic
value of restricted shares converted during the years ended
May 31, 2007, 2006 and 2005 was $1.1 million, $0.9 million
and $0.5 million, respectively.
Total unrecognized compensation cost related to nonvested
restricted shares of common stock awards granted was
$13.1 million as of May 31, 2007. That cost is expected to be
recognized over a weighted-average period of 2.1 years.
We did not receive any cash from employees as a result of
employee vesting and release of restricted shares for the year
ended May 31, 2007..
We lease certain property, plant and equipment under
long-term operating lease agreements, some of which provide
for increased rental payments based upon increases in the
cost-of-living index. The following table illustrates our future
minimum lease commitments under all non-cancelable lease
agreements, for each of the next five years and in the
aggregate, as of May 31, 2007:
Total rental expense for all operating leases amounted to
$28.8 million in fiscal 2007, $26.8 million in fiscal 2006 and
$29.4 million in fiscal 2005.
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We sponsor several pension plans for our employees, including
our principal plan (the “Retirement Plan”), which is a noncontributory
defined benefit pension plan covering
substantially all domestic non-union employees. Pension
benefits are provided for certain domestic union employees
through separate plans. Employees of our foreign subsidiaries
receive pension coverage, to the extent deemed appropriate,
through plans that are governed by local statutory
requirements.
The Retirement Plan provides benefits that are based upon
years of service and average compensation with accrued
benefits vesting after five years. Benefits for union employees
are generally based upon years of service, or a combination of
years of service and average compensation. Our pension
funding policy is to contribute an amount on an annual basis
that can be deducted for federal income tax purposes, using a
different actuarial cost method and different assumptions
from those used for financial reporting. For the fiscal year
ending May 31, 2008, we expect to contribute approximately
$10.3 million to the retirement plans in the U.S.; and
approximately $8.7 million to our foreign plans.
During the fiscal year ended May 31, 2007, we adopted the
provisions of Statement of Financial Accounting Standards
No. 158 (“SFAS No. 158”), “Employer’s Accounting for Defined
Benefit Pension and Other Postretirement Plans – an
amendment of FASB Statements No. 87, 88, 106 and 132(R).”
SFAS No. 158 requires the recognition of the funded status of
each defined benefit pension plan and nonpension,
postretirement benefit plan on the balance sheet. Under this
new pronouncement, each overfunded plan is recognized as
an asset and each underfunded plan is recognized as a liability.
The initial impact of SFAS No. 158, due to previously
unrecognized actuarial gains and losses and prior service costs
or credits, as well as future gains and losses and plan changes,
is recognized as a component of accumulated other
comprehensive income (loss) in the stockholders’ equity section
of the balance sheet, net of applicable taxes.
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