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## NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) 

The following table summarizes total compensation costs related to unvested awards not yet recognized and the weighted average period over which it is expected to be recognized at September 30, 2011: 

<img src='content_image/262405.jpg'>

The fair value of each option grant under the Company’s plan is estimated on the date of the grant using the Black-Scholes option pricing model with the following weighted average assumptions. The fair value of the restricted and performance awards is equal to the closing market price of the Company’s common stock on the date of grant. 

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The Company used an arithmetic average of historical volatility and implied volatility to calculate its expected volatility during the year ended September 30, 2011. Historical volatility was determined by calculating the mean reversion of the weekly-adjusted closing stock price over the expected life of the options. The implied volatility was calculated by analyzing the 52-week minimum and maximum prices of publicly traded call options on the Company’s common stock. The Company concluded that an arithmetic average of these two calculations provided for the most reasonable estimate of expected volatility under the guidance of ASC 718. 

The risk-free interest rate assumption is based upon observed Treasury bill interest rates appropriate for the expected life of the Company’s employee stock options. 

The expected life of employee stock options represents a calculation based upon the historical exercise, cancellation and forfeiture experience for the Company across its demographic population. The Company believes that this historical data is the best estimate of the expected life of a new option and that generally all groups of the Company’s employee’s exhibit similar behavior. 

## 12. EMPLOYEE BENEFIT PLAN, PENSIONS AND OTHER RETIREE BENEFITS 

The Company maintains the following pension and retiree benefit plans: 

• 401(k) plan covering substantially all employees based in the United States 

• Pre-merger defined benefit pension plan covering certain former employees 

401(k) Plan: 

The Company maintains a 401(k) plan covering substantially all of its employees based in the United States under which all employees at least 21 years old are eligible to receive discretionary Company contributions. 

