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sonc:segment
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--08-31
Q3
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10-Q
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Accelerated Filer
SONIC CORP
295903000
314327000
38389000
17734000
38764000
18670000
13124000
11202000
11338000
11338000
10669000
10669000
12850000
12850000
10351000
10351000
8108000
8108000
7963000
7963000
1271000
385000
851000
202000
94268000
37038000
95436000
37857000
94268000
37038000
95436000
37857000
1200000
2021
2024
<div> <p style="text-align: left;"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">5. Impairment of Long-Lived Assets and Goodwill</font></b></p>
<p style="text-align: left;"><i><font style="font-family: TimesNewRomanPS-ItalicMT,Times New Roman,Times,serif;" class="_mt" size="2">Long-Lived Assets</font></i></p>
<p style="text-align: left;"> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">The Company assesses long-lived assets used in operations for possible impairment when events and circumstances indicate that such assets might be impaired and the undiscounted cash flows estimated to be generated by those assets are less than their carrying amount. No material impairment charges for long-lived assets were recorded during the first nine months of fiscal year 2012 or in the same period last year. Projecting the cash flows for the impairment analysis involves significant estimates with regard to the performance of each drive-in, and it is reasonably possible that the estimates of cash flows may change in the near term resulting in the need to write down operating assets to fair value.</font></p>
<p style="text-align: left;"><i><font style="font-family: TimesNewRomanPS-ItalicMT,Times New Roman,Times,serif;" class="_mt" size="2">Goodwill</font></i></p>
<p style="text-align: left;"> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">The Company evaluated goodwill for impairment in conjunction with the sale of <font class="_mt">34</font> Company Drive-Ins to franchisees during the second quarter of fiscal year 2012. As of the date of the evaluation, the fair value of the Company's reporting units exceeded their carrying value. The Company is required to test goodwill for impairment on an annual basis and between annual tests as a result of allocating goodwill to Company Drive-Ins that are sold or whenever indications of impairment arise including, but not limited to, a significant decline in cash flows from store operations. Such tests could result in impairment charges. As of May 31, 2012, the Company had $77.0 million of goodwill, of which $<font class="_mt">71.0</font> million was attributable to the Company Drive-Ins segment and $<font class="_mt">6.0</font> million was attributable to the Franchise Operations segment. The decrease in goodwill since August 31, 2011, was a result of allocating goodwill to Company Drive-Ins sold during the first nine months of fiscal year 2012. For more information regarding the Company's goodwill and other intangible assets information, see note 1 - Summary of Significant Accounting Policies in the Notes to Consolidated Financial Statements in the Company's Annual Report on Form 10-K for the year ended August 31, 2011.</font></p> </div>
34
-39883000
25300000
760778000
759271000
464875000
444944000
<div> <div>
<p style="text-align: left;"><i><font style="font-family: TimesNewRomanPS-ItalicMT,Times New Roman,Times,serif;" class="_mt" size="2">Reclassifications</font></i></p>
<p style="text-align: left;"> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Certain amounts reported in previous years, which are not material, have been combined and reclassified to conform to the current year presentation. Effective April 1, 2010, the Company revised its compensation program at the Company Drive-In level. As a result of these changes, noncontrolling interests are immaterial for the periods presented and have been included in "payroll and other employee benefits" on the Condensed Consolidated Statements of Income and in "other noncurrent liabilities" on the Condensed Consolidated Balance Sheets.</font></p></div> </div>
<div> <table border="0" cellspacing="0">
<tr><td width="44%"> </td>
<td width="2%"> </td>
<td width="6%"> </td>
<td width="2%"> </td>
<td width="3%"> </td>
<td width="6%"> </td>
<td width="2%"> </td>
<td width="2%"> </td>
<td width="8%"> </td>
<td width="2%"> </td>
<td width="2%"> </td>
<td width="6%"> </td>
<td width="2%"> </td></tr>
<tr valign="bottom"><td width="44%" align="left"> </td>
<td width="21%" colspan="6" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">Three months ended</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">May 31,</font></b></td>
<td width="22%" colspan="6" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">Nine months ended</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">May 31,</font></b></td></tr>
<tr valign="bottom"><td width="44%" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" width="10%" colspan="3" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">2012</font></b></td>
<td style="border-bottom: #000000 1px solid;" width="11%" colspan="3" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">2011</font></b></td>
<td style="border-bottom: #000000 1px solid;" width="12%" colspan="3" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">2012</font></b></td>
<td style="border-bottom: #000000 1px solid;" width="10%" colspan="3" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">2011</font></b></td></tr>
<tr valign="bottom"><td width="44%" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Provision (benefit) for income taxes</font></td>
<td width="2%" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td width="6%" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">8,667</font></b></td>
<td width="2%" align="right"> </td>
<td width="3%" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font> </td>
<td width="6%" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">(2,742</font></td>
<td width="2%" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></td>
<td width="2%" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td width="8%" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">13,125</font></b></td>
<td width="2%" align="right"> </td>
<td width="2%" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font> </td>
<td width="6%" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">2,195</font></td>
<td width="2%" align="left"> </td></tr>
<tr valign="bottom"><td width="44%" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Effective income tax rate</font></td>
<td width="2%" align="left"> </td>
<td width="6%" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">37.6</font></b></td>
<td width="2%" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">%</font></b></td>
<td width="3%" align="left"><b> </b></td>
<td width="6%" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">37.1</font></td>
<td width="2%" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">%</font></td>
<td width="2%" align="left"> </td>
<td width="8%" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">37.8</font></b></td>
<td width="2%" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">%</font></b> </td>
<td width="2%" align="left"><b> </b></td>
<td width="6%" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">24.0</font></td>
<td width="2%" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">%</font></td></tr></table> </div>
32296000
32296000
28983000
28983000
3300000
1295000
3930000
1651000
3045000
1315000
3317000
1500000
24558000
24411000
11135000
11755000
4775000
4333000
33532000
32344000
229399000
229692000
41297000
42363000
6621000
6457000
7269000
7382000
313000
49000
376000
203000
679742000
666714000
93457000
97946000
886000
2036000
30302000
28735000
86036000
38865000
29509000
41672000
-47171000
12163000
<div> <p style="text-align: left;"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">6. Contingencies</font></b></p>
<p style="text-align: left;"> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">The Company is involved in various legal proceedings and has certain unresolved claims pending. Based on the information currently available, management believes that all claims currently pending are either covered by insurance or would not have a material adverse effect on the Company's business, operating results or financial condition.</font></p>
<div> </div><br />
<p style="text-align: left;"> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">The Company has obligations under various lease agreements with third-party lessors related to the real estate for certain Company Drive-In operations that were sold to franchisees. Under these agreements, which expire through <font class="_mt">2024</font>, the Company remains secondarily liable for the lease payments for which it was responsible as the original lessee. As of May 31, 2012, the amount remaining under these guaranteed lease obligations totaled $<font class="_mt">8.5</font> million. At this time, the Company does not anticipate any material defaults under the foregoing leases; therefore, no liability has been provided. In addition, capital lease obligations totaling $<font class="_mt">1.2</font> million are still reflected as liabilities as of May 31, 2012, for properties sold to franchisees and for which the <font class="_mt">Company remains secondarily liable through</font> <font class="_mt">2021</font>. At this time, the Company also does not anticipate any material defaults under these capital leases.</font></p> </div>
0.01
0.01
245000000
245000000
118309000
118309000
1183000
1183000
<div> <div>
<p style="text-align: left;"><i><font style="font-family: TimesNewRomanPS-ItalicMT,Times New Roman,Times,serif;" class="_mt" size="2">Principles of Consolidation</font></i></p>
<p style="text-align: left;"> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">The accompanying financial statements include the accounts of the Company, its wholly owned subsidiaries and its Company Drive-Ins. All significant intercompany accounts and transactions have been eliminated.</font></p></div> </div>
259065000
96011000
255273000
91400000
108741000
40466000
106363000
38539000
338962000
123411000
335365000
118842000
<div> <p style="text-align: left;"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">7. Debt</font></b></p>
<p style="text-align: left;"> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">In connection with the Company's May 2011 refinancing of its Series 2006-1 Senior Secured Variable Funding Notes, Class A-1 (the "2006 Variable Funding Notes") and Series 2006-1 Senior Secured Fixed Rate Notes, Class A-2, the Company recognized a $28.2 million loss from the early extinguishment of debt during the third quarter of fiscal year 2011, which primarily consisted of a $<font class="_mt">25.3</font> <font class="_mt">million prepayment </font>premium and the write-off of unamortized deferred loan fees remaining from the refinanced debt. In addition, the Company's deferred hedging loss was reclassified from accumulated other comprehensive income into earnings during the third quarter of fiscal year 2011. Prior to the refinancing, during the second quarter of fiscal year 2011, the Company repurchased $<font class="_mt">62.5</font> million of its 2006 Variable Funding Notes in a privately negotiated transaction. The Company recognized a gain of $<font class="_mt">5.2</font> million on the extinguishment of the notes during the second fiscal quarter of 2011. These transactions are reflected within "net loss from early extinguishment of debt" in the accompanying Condensed Consolidated Statements of Income.</font></p> </div>
62500000
2897000
3519000
27228000
30253000
30806000
10139000
31264000
10288000
0.11
-0.08
0.36
0.24
0.11
-0.08
0.36
0.24
<div> <div>
<p style="text-align: left;"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">2. Earnings (Loss) Per Share</font></b></p>
<p style="text-align: left;"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">The following table presents the calculation of basic and diluted earnings (loss) per share:</font></p>
<div class="MetaData">
<div>
<table border="0" cellspacing="0">
<tr><td width="42%"> </td>
<td width="3%"> </td>
<td width="9%"> </td>
<td width="4%"> </td>
<td width="10%"> </td>
<td width="3%"> </td>
<td width="5%"> </td>
<td width="9%"> </td>
<td width="4%"> </td>
<td width="6%"> </td></tr>
<tr valign="bottom"><td align="left"> </td>
<td colspan="5" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">Three months ended</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">May 31,</font></b></td>
<td colspan="4" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">Nine months ended</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">May 31,</font></b></td></tr>
<tr valign="bottom"><td align="left"> </td>
<td style="border-bottom: #000000 1px solid;" colspan="2" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">2012</font></b></td>
<td style="border-bottom: #000000 1px solid;" colspan="3" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">2011</font></b></td>
<td style="border-bottom: #000000 1px solid;" colspan="2" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">2012</font></b></td>
<td style="border-bottom: #000000 1px solid;" colspan="2" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">2011</font></b></td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Numerator:</font></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Net income (loss)</font></td>
<td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">14,407</font></b></td>
<td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">(4,651</font></td>
<td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></td>
<td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">21,583</font></b></td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">6,939</font></td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Denominator:</font></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Weighted average common shares</font><br /><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">outstanding – basic</font></td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">59,936</font></b></td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">61,842</font></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">60,736</font></b></td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">61,723</font></td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Effect of dilutive employee stock options and</font><br /><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">unvested restricted stock units</font></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">25</font></b></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">158</font></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">31</font></b></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">150</font></td></tr>
<tr valign="bottom"><td style="text-indent: 1px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Weighted average common shares – diluted</font></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">59,961</font></b></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">62,000</font></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">60,767</font></b></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">61,873</font></td></tr>
<tr><td colspan="10"> </td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Net income (loss) per common share – basic</font></td>
<td style="border-bottom: #000000 3px double;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">0.24</font></b></td>
<td style="border-bottom: #000000 3px double;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">(0.08</font></td>
<td style="border-bottom: #000000 3px double;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></td>
<td style="border-bottom: #000000 3px double;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">0.36</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">0.11</font></td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Net income (loss) per common share – diluted</font></td>
<td style="border-bottom: #000000 3px double;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">0.24</font></b></td>
<td style="border-bottom: #000000 3px double;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">(0.08</font></td>
<td style="border-bottom: #000000 3px double;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></td>
<td style="border-bottom: #000000 3px double;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">0.36</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">0.11</font></td></tr>
<tr><td colspan="10"> </td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Anti-dilutive securities excluded</font><sup><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">(1)</font></sup></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">7,382</font></b></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">6,457</font></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">7,269</font></b></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">6,621</font></td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: ArialMT,Arial,Helvetica,sans-serif;" class="_mt" size="1">—————————</font></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td></tr></table></div>
<p style="margin: 0px;"> </p>
<p style="text-align: left;"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="1">(1) <font class="_mt">Anti-dilutive securities consist of stock options and unvested restricted stock units that were not included in the computation of diluted earnings per share because either the exercise price of the options was greater than the average market price of the common stock or the total assumed proceeds under the treasury stock method resulted in negative incremental shares and thus the inclusion would have been anti-dilutive.</font></font></p></div></div>
<div> </div><br /> </div>
0.240
0.371
0.378
0.376
<div> <div class="MetaData">
<p style="text-align: left;"> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">The table below sets forth our fair value hierarchy for financial assets measured at fair value on a recurring basis as of May 31, 2012, (in thousands):</font></p>
<div>
<table border="0" cellspacing="0">
<tr><td width="27%"> </td>
<td width="3%"> </td>
<td width="19%"> </td>
<td width="4%"> </td>
<td width="12%"> </td>
<td width="6%"> </td>
<td width="12%"> </td>
<td width="5%"> </td>
<td width="8%"> </td></tr>
<tr valign="bottom"><td align="left"> </td>
<td style="border-bottom: #000000 1px solid;" colspan="2" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Quoted Prices in</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Active Markets</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">for Identical</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Assets</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">(Level 1)</font></b></td>
<td style="border-bottom: #000000 1px solid;" colspan="2" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Significant</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Other</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Observable</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Inputs</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">(Level 2)</font></b></td>
<td style="border-bottom: #000000 1px solid;" colspan="2" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Significant</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Unobservable</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Inputs</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">(Level 3)</font></b></td>
<td style="border-bottom: #000000 1px solid;" colspan="2" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Total</font></b></td></tr>
<tr valign="bottom"><td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">Assets:</font></b></td>
<td align="right"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Cash equivalents</font></td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">10,669</font></b></td>
<td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></b></td>
<td style="text-indent: 2px;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></b></td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">10,669</font></b></td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Restricted cash (current)</font></td>
<td align="right"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">10,351</font></b></td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></b></td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></b></td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">10,351</font></b></td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Restricted cash (noncurrent)</font></td>
<td style="border-bottom: #000000 1px solid;" align="right"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">7,963</font></b></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></b></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></b></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">7,963</font></b></td></tr>
<tr valign="bottom"><td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">Total</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">28,983</font></b></td>
<td style="border-bottom: #000000 3px double;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></b></td>
<td style="border-bottom: #000000 3px double; text-indent: 2px;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">28,983</font></b></td></tr></table></div>
<p style="margin: 0px;"> </p>
<p style="text-align: left;"> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">The table below sets forth our fair value hierarchy for financial assets measured at fair value on a recurring basis as of August 31, 2011, (in thousands):</font></p>
<div>
<table border="0" cellspacing="0">
<tr><td width="27%"> </td>
<td width="3%"> </td>
<td width="19%"> </td>
<td width="4%"> </td>
<td width="12%"> </td>
<td width="8%"> </td>
<td width="10%"> </td>
<td width="7%"> </td>
<td width="7%"> </td></tr>
<tr valign="bottom"><td align="left"> </td>
<td style="border-bottom: #000000 1px solid;" colspan="2" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Quoted Prices in</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Active Markets</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">for Identical</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Assets</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">(Level 1)</font></b></td>
<td style="border-bottom: #000000 1px solid;" colspan="2" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Significant</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Other</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Observable</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Inputs</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">(Level 2)</font></b></td>
<td style="border-bottom: #000000 1px solid;" colspan="2" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Significant</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Unobservable</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Inputs</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">(Level 3)</font></b></td>
<td style="border-bottom: #000000 1px solid;" colspan="2" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Total</font></b></td></tr>
<tr valign="bottom"><td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">Assets:</font></b></td>
<td align="right"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Cash equivalents</font></td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">11,338</font></td>
<td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></td>
<td style="text-indent: 2px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></td>
<td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">11,338</font></td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Restricted cash (current)</font></td>
<td align="right"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">12,850</font></td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">12,850</font></td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Restricted cash (noncurrent)</font></td>
<td style="border-bottom: #000000 1px solid;" align="right"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">8,108</font></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">8,108</font></td></tr>
<tr valign="bottom"><td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">Total</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">32,296</font></td>
<td style="border-bottom: #000000 3px double;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></td>
<td style="border-bottom: #000000 3px double; text-indent: 2px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></td>
<td style="border-bottom: #000000 3px double;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td style="border-bottom: #000000 3px double;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">32,296</font></td></tr></table></div></div> </div>
<div> <div>
<p style="text-align: left;"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">8. Fair Value of Financial Instruments</font></b></p>
<p style="text-align: left;"> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">The fair value of financial instruments is the amount at which the instrument could be exchanged in a current transaction between willing parties. The Company has no financial liabilities that are required to be measured at fair value on a recurring basis.</font></p>
<p style="text-align: left;"> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">The Company categorizes its assets and liabilities recorded at fair value based upon the following fair value hierarchy established by the Financial Accounting Standards Board:</font></p>
<ul>
<li>
<p align="justify"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Level 1 valuations use quoted prices in active markets for identical assets or liabilities that are accessible at</font> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">the measurement date. An active market is a market in which transactions for the asset or liability occur</font> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">with sufficient frequency and volume to provide pricing information on an ongoing basis.</font></p>
</li>
<li>
<p align="justify"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Level 2 valuations use inputs other than actively quoted market prices included within Level 1 that are</font> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">observable for the asset or liability, either directly or indirectly. Level 2 inputs include: (a) quoted prices for</font> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">similar assets or liabilities in active markets, (b) quoted prices for identical or similar assets or liabilities in</font> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">markets that are not active, (c) inputs other than quoted prices that are observable for the asset or liability</font> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">such as interest rates and yield curves observable at commonly quoted intervals and (d) inputs that are</font> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">derived principally from or corroborated by observable market data by correlation or other means.</font></p>
</li>
<li>
<p align="justify"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Level 3 valuations use unobservable inputs for the asset or liability. Unobservable inputs are used to the</font> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">extent observable inputs are not available, thereby allowing for situations in which there is little, if any,</font> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">market activity for the asset or liability at the measurement date.</font></p></li></ul></div>
<div> </div><br />
<div>
<div class="MetaData">
<p style="text-align: left;"> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">The table below sets forth our fair value hierarchy for financial assets measured at fair value on a recurring basis as of May 31, 2012, (in thousands):</font></p>
<div>
<table border="0" cellspacing="0">
<tr><td width="27%"> </td>
<td width="3%"> </td>
<td width="19%"> </td>
<td width="4%"> </td>
<td width="12%"> </td>
<td width="6%"> </td>
<td width="12%"> </td>
<td width="5%"> </td>
<td width="8%"> </td></tr>
<tr valign="bottom"><td align="left"> </td>
<td style="border-bottom: #000000 1px solid;" colspan="2" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Quoted Prices in</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Active Markets</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">for Identical</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Assets</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">(Level 1)</font></b></td>
<td style="border-bottom: #000000 1px solid;" colspan="2" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Significant</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Other</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Observable</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Inputs</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">(Level 2)</font></b></td>
<td style="border-bottom: #000000 1px solid;" colspan="2" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Significant</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Unobservable</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Inputs</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">(Level 3)</font></b></td>
<td style="border-bottom: #000000 1px solid;" colspan="2" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Total</font></b></td></tr>
<tr valign="bottom"><td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">Assets:</font></b></td>
<td align="right"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Cash equivalents</font></td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">10,669</font></b></td>
<td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></b></td>
<td style="text-indent: 2px;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></b></td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">10,669</font></b></td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Restricted cash (current)</font></td>
<td align="right"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">10,351</font></b></td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></b></td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></b></td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">10,351</font></b></td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Restricted cash (noncurrent)</font></td>
<td style="border-bottom: #000000 1px solid;" align="right"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">7,963</font></b></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></b></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></b></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">7,963</font></b></td></tr>
<tr valign="bottom"><td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">Total</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">28,983</font></b></td>
<td style="border-bottom: #000000 3px double;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></b></td>
<td style="border-bottom: #000000 3px double; text-indent: 2px;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">28,983</font></b></td></tr></table></div>
<p style="margin: 0px;"> </p>
<p style="text-align: left;"> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">The table below sets forth our fair value hierarchy for financial assets measured at fair value on a recurring basis as of August 31, 2011, (in thousands):</font></p>
<div>
<table border="0" cellspacing="0">
<tr><td width="27%"> </td>
<td width="3%"> </td>
<td width="19%"> </td>
<td width="4%"> </td>
<td width="12%"> </td>
<td width="8%"> </td>
<td width="10%"> </td>
<td width="7%"> </td>
<td width="7%"> </td></tr>
<tr valign="bottom"><td align="left"> </td>
<td style="border-bottom: #000000 1px solid;" colspan="2" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Quoted Prices in</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Active Markets</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">for Identical</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Assets</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">(Level 1)</font></b></td>
<td style="border-bottom: #000000 1px solid;" colspan="2" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Significant</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Other</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Observable</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Inputs</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">(Level 2)</font></b></td>
<td style="border-bottom: #000000 1px solid;" colspan="2" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Significant</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Unobservable</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Inputs</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">(Level 3)</font></b></td>
<td style="border-bottom: #000000 1px solid;" colspan="2" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="1">Total</font></b></td></tr>
<tr valign="bottom"><td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">Assets:</font></b></td>
<td align="right"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Cash equivalents</font></td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">11,338</font></td>
<td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></td>
<td style="text-indent: 2px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></td>
<td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">11,338</font></td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Restricted cash (current)</font></td>
<td align="right"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">12,850</font></td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">12,850</font></td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Restricted cash (noncurrent)</font></td>
<td style="border-bottom: #000000 1px solid;" align="right"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">8,108</font></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">8,108</font></td></tr>
<tr valign="bottom"><td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">Total</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">32,296</font></td>
<td style="border-bottom: #000000 3px double;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></td>
<td style="border-bottom: #000000 3px double; text-indent: 2px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">—</font></td>
<td style="border-bottom: #000000 3px double;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td style="border-bottom: #000000 3px double;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">32,296</font></td></tr></table></div></div>
<p style="margin: 0px;"> </p><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">
</font>
<p style="text-align: left;"> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">At May 31, 2012, the fair value of the Company's Series 2011-1 Senior Secured Fixed Rate Notes, Class A-2 (the "2011 Fixed Rate Notes") was estimated at $<font class="_mt">510.0</font> million versus a carrying value of $<font class="_mt">485.7</font> million, including accrued interest. At August 31, 2011, the fair value of the 2011 Fixed Rate Notes approximated the carrying value of $<font class="_mt">497.0</font> million, including accrued interest. The fair value of the 2011 Fixed Rate Notes is estimated using Level 2 inputs from market information available for public debt transactions for companies with ratings that are similar to the Company's ratings and from information gathered from brokers who trade in the Company's notes.</font></p></div> </div>
83559000
31996000
83011000
30600000
88650000
34825000
89980000
35599000
-23025000
5200000
-28230000
81625000
76996000
71000000
6000000
0
8500000
9134000
-7393000
34708000
23074000
<div> <p style="text-align: left;"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">4. Income Taxes</font></b></p>
<p style="text-align: left;"> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">The following table presents the Company's provision for income taxes and effective income tax rate for the periods below:</font></p>
<div>
<table border="0" cellspacing="0">
<tr><td width="44%"> </td>
<td width="2%"> </td>
<td width="6%"> </td>
<td width="2%"> </td>
<td width="3%"> </td>
<td width="6%"> </td>
<td width="2%"> </td>
<td width="2%"> </td>
<td width="8%"> </td>
<td width="2%"> </td>
<td width="2%"> </td>
<td width="6%"> </td>
<td width="2%"> </td></tr>
<tr valign="bottom"><td width="44%" align="left"> </td>
<td width="21%" colspan="6" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">Three months ended</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">May 31,</font></b></td>
<td width="22%" colspan="6" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">Nine months ended</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">May 31,</font></b></td></tr>
<tr valign="bottom"><td width="44%" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" width="10%" colspan="3" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">2012</font></b></td>
<td style="border-bottom: #000000 1px solid;" width="11%" colspan="3" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">2011</font></b></td>
<td style="border-bottom: #000000 1px solid;" width="12%" colspan="3" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">2012</font></b></td>
<td style="border-bottom: #000000 1px solid;" width="10%" colspan="3" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">2011</font></b></td></tr>
<tr valign="bottom"><td width="44%" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Provision (benefit) for income taxes</font></td>
<td width="2%" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td width="6%" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">8,667</font></b></td>
<td width="2%" align="right"> </td>
<td width="3%" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font> </td>
<td width="6%" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">(2,742</font></td>
<td width="2%" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></td>
<td width="2%" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td width="8%" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">13,125</font></b></td>
<td width="2%" align="right"> </td>
<td width="2%" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font> </td>
<td width="6%" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">2,195</font></td>
<td width="2%" align="left"> </td></tr>
<tr valign="bottom"><td width="44%" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Effective income tax rate</font></td>
<td width="2%" align="left"> </td>
<td width="6%" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">37.6</font></b></td>
<td width="2%" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">%</font></b></td>
<td width="3%" align="left"><b> </b></td>
<td width="6%" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">37.1</font></td>
<td width="2%" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">%</font></td>
<td width="2%" align="left"> </td>
<td width="8%" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">37.8</font></b></td>
<td width="2%" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">%</font></b> </td>
<td width="2%" align="left"><b> </b></td>
<td width="6%" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">24.0</font></td>
<td width="2%" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">%</font></td></tr></table></div>
<p style="margin: 0px;"> </p>
<p style="text-align: left;"> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">The increase in the Company's effective income tax rate during the first nine months of fiscal year 2012 was primarily attributable to a $<font class="_mt">1.1</font> million decrease in the Company's liability for unrecognized tax benefits resulting from the settlement of state tax audits during the first quarter of fiscal year 2011 and the expiration of tax credit programs during the second quarter of fiscal year 2012.</font></p> </div>
12776000
10707000
2195000
-2742000
13125000
8667000
7269000
611000
1488000
834000
-6517000
7665000
-1832000
-1286000
4816000
-2455000
150000
158000
31000
25000
24414000
7991000
23807000
7836000
-46926000
-36060000
-23330000
-7662000
513000
161000
477000
174000
679742000
666714000
71279000
71401000
556767000
546428000
497000000
485700000
18940000
19450000
497000000
510000000
481835000
470562000
-84751000
-39601000
-10656000
-12182000
48236000
63946000
6939000
-4651000
21583000
14407000
11086000
14606000
2
56060000
28667000
58038000
30736000
4347000
1828000
4605000
2056000
<div> <p style="text-align: left;"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">1. Basis of Presentation</font></b></p>
<p style="text-align: left;"> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles ("GAAP") and with the rules and regulations of the Securities and Exchange Commission. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements of Sonic Corp. (the "Company"). In the opinion of management, these financial statements reflect all adjustments of a normal recurring nature, including recurring accruals, necessary for the fair presentation of the Company's financial position, results of operations and cash flows for the interim periods presented in conformity with GAAP. In certain situations, recurring accruals, including franchise royalties, are based on more limited information at interim reporting dates than at the Company's fiscal year end due to the abbreviated reporting period. Actual results may differ from these estimates. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the fiscal year ended August 31, 2011 included in the Company's Annual Report on Form 10-K. Interim results are not necessarily indicative of the results that may be expected for a full year or any other interim period.</font></p>
<div>
<p style="text-align: left;"><i><font style="font-family: TimesNewRomanPS-ItalicMT,Times New Roman,Times,serif;" class="_mt" size="2">Principles of Consolidation</font></i></p>
<p style="text-align: left;"> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">The accompanying financial statements include the accounts of the Company, its wholly owned subsidiaries and its Company Drive-Ins. All significant intercompany accounts and transactions have been eliminated.</font></p></div>
<div>
<p style="text-align: left;"><i><font style="font-family: TimesNewRomanPS-ItalicMT,Times New Roman,Times,serif;" class="_mt" size="2">Reclassifications</font></i></p>
<p style="text-align: left;"> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Certain amounts reported in previous years, which are not material, have been combined and reclassified to conform to the current year presentation. Effective April 1, 2010, the Company revised its compensation program at the Company Drive-In level. As a result of these changes, noncontrolling interests are immaterial for the periods presented and have been included in "payroll and other employee benefits" on the Condensed Consolidated Statements of Income and in "other noncurrent liabilities" on the Condensed Consolidated Balance Sheets.</font></p></div>
<p style="text-align: left;">
</p>
<p style="text-align: left;"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2"> </font></p>
<p> </p>
<p style="text-align: left;"> </p> </div>
7467000
13057000
66765000
23549000
65899000
22261000
17402000
16878000
1938000
-1162000
255000
-20000
613000
151000
3045000
1315000
3317000
1500000
-1373000
7806000
25534000
14739000
12938000
0.01
0.01
1000000
1000000
0
0
13764000
10805000
535000000
-878000
-2986000
6245000
190000
2710000
8562000
585235000
11271000
12850000
10351000
8108000
7963000
687431000
708295000
394767000
152098000
392790000
149427000
297454000
113745000
294037000
110070000
<div> <div class="MetaData">
<div>
<table border="0" cellspacing="0">
<tr><td width="42%"> </td>
<td width="3%"> </td>
<td width="9%"> </td>
<td width="4%"> </td>
<td width="10%"> </td>
<td width="3%"> </td>
<td width="5%"> </td>
<td width="9%"> </td>
<td width="4%"> </td>
<td width="6%"> </td></tr>
<tr valign="bottom"><td align="left"> </td>
<td colspan="5" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">Three months ended</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">May 31,</font></b></td>
<td colspan="4" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">Nine months ended</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">May 31,</font></b></td></tr>
<tr valign="bottom"><td align="left"> </td>
<td style="border-bottom: #000000 1px solid;" colspan="2" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">2012</font></b></td>
<td style="border-bottom: #000000 1px solid;" colspan="3" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">2011</font></b></td>
<td style="border-bottom: #000000 1px solid;" colspan="2" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">2012</font></b></td>
<td style="border-bottom: #000000 1px solid;" colspan="2" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">2011</font></b></td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Numerator:</font></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Net income (loss)</font></td>
<td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">14,407</font></b></td>
<td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">(4,651</font></td>
<td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></td>
<td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">21,583</font></b></td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">6,939</font></td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Denominator:</font></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Weighted average common shares</font><br /><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">outstanding – basic</font></td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">59,936</font></b></td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">61,842</font></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">60,736</font></b></td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">61,723</font></td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Effect of dilutive employee stock options and</font><br /><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">unvested restricted stock units</font></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">25</font></b></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">158</font></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">31</font></b></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">150</font></td></tr>
<tr valign="bottom"><td style="text-indent: 1px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Weighted average common shares – diluted</font></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">59,961</font></b></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">62,000</font></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">60,767</font></b></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">61,873</font></td></tr>
<tr><td colspan="10"> </td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Net income (loss) per common share – basic</font></td>
<td style="border-bottom: #000000 3px double;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">0.24</font></b></td>
<td style="border-bottom: #000000 3px double;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">(0.08</font></td>
<td style="border-bottom: #000000 3px double;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></td>
<td style="border-bottom: #000000 3px double;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">0.36</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">0.11</font></td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Net income (loss) per common share – diluted</font></td>
<td style="border-bottom: #000000 3px double;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">0.24</font></b></td>
<td style="border-bottom: #000000 3px double;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">(0.08</font></td>
<td style="border-bottom: #000000 3px double;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></td>
<td style="border-bottom: #000000 3px double;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">0.36</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">0.11</font></td></tr>
<tr><td colspan="10"> </td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Anti-dilutive securities excluded</font><sup><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">(1)</font></sup></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">7,382</font></b></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">6,457</font></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">7,269</font></b></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">6,621</font></td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: ArialMT,Arial,Helvetica,sans-serif;" class="_mt" size="1">—————————</font></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td></tr></table></div>
<p style="margin: 0px;"> </p>
<p style="text-align: left;"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="1">(1) <font class="_mt">Anti-dilutive securities consist of stock options and unvested restricted stock units that were not included in the computation of diluted earnings per share because either the exercise price of the options was greater than the average market price of the common stock or the total assumed proceeds under the treasury stock method resulted in negative incremental shares and thus the inclusion would have been anti-dilutive.</font></font></p></div> </div>
<div> <table border="0" cellspacing="0">
<tr><td width="35%"> </td>
<td width="3%"> </td>
<td width="9%"> </td>
<td width="2%"> </td>
<td width="3%"> </td>
<td width="10%"> </td>
<td width="2%"> </td>
<td width="4%"> </td>
<td width="9%"> </td>
<td width="2%"> </td>
<td width="3%"> </td>
<td width="7%"> </td>
<td width="2%"> </td></tr>
<tr valign="bottom"><td align="left"> </td>
<td colspan="6" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">Three months ended</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">May 31,</font></b></td>
<td colspan="6" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">Nine months ended</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">May 31,</font></b></td></tr>
<tr valign="bottom"><td align="left"> </td>
<td style="border-bottom: #000000 1px solid;" colspan="3" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">2012</font></b></td>
<td style="border-bottom: #000000 1px solid;" colspan="3" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">2011</font></b></td>
<td style="border-bottom: #000000 1px solid;" colspan="3" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">2012</font></b></td>
<td style="border-bottom: #000000 1px solid;" colspan="3" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">2011</font></b></td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Revenues:</font></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td></tr>
<tr valign="bottom"><td style="text-indent: 2px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Company Drive-Ins</font></td>
<td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">110,070</font></b></td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">113,745</font></td>
<td align="left"> </td>
<td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">294,037</font></b></td>
<td align="left"> </td>
<td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">297,454</font></td>
<td align="left"> </td></tr>
<tr valign="bottom"><td style="text-indent: 2px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Franchise Operations</font></td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">37,857</font></b></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">37,038</font></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">95,436</font></b></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">94,268</font></td>
<td align="left"> </td></tr>
<tr valign="bottom"><td style="text-indent: 2px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Unallocated revenues</font></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">1,500</font></b></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">1,315</font></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">3,317</font></b></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">3,045</font></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td></tr>
<tr valign="bottom"><td align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">149,427</font></b></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">152,098</font></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">392,790</font></b></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">394,767</font></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td></tr>
<tr><td colspan="13"> </td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Income from Operations:</font></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td></tr>
<tr valign="bottom"><td style="text-indent: 2px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Company Drive-Ins</font></td>
<td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">18,670</font></b></td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">17,734</font></td>
<td align="left"> </td>
<td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">38,764</font></b></td>
<td align="left"> </td>
<td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">38,389</font></td>
<td align="left"> </td></tr>
<tr valign="bottom"><td style="text-indent: 2px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Franchise Operations</font></td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">37,857</font></b></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">37,038</font></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">95,436</font></b></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">94,268</font></td>
<td align="left"> </td></tr>
<tr valign="bottom"><td style="text-indent: 2px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Unallocated income</font></td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">1,651</font></b></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">1,295</font></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">3,930</font></b></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">3,300</font></td>
<td align="left"> </td></tr>
<tr valign="bottom"><td style="text-indent: 2px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Unallocated expenses:</font></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td></tr>
<tr valign="bottom"><td style="text-indent: 6px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Selling, general and administrative</font></td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">(16,951</font></b></td>
<td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></b></td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">(17,212</font></td>
<td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">(48,452</font></b></td>
<td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></b></td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">(48,778</font></td>
<td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></td></tr>
<tr valign="bottom"><td style="text-indent: 6px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Depreciation and amortization</font></td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">(10,288</font></b></td>
<td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></b></td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">(10,139</font></td>
<td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">(31,264</font></b></td>
<td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></b></td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">(30,806</font></td>
<td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Provision for impairment of long-lived</font><br /><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">assets</font></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">(203</font></b></td>
<td style="border-bottom: #000000 1px solid;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></b></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">(49</font></td>
<td style="border-bottom: #000000 1px solid;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">(376</font></b></td>
<td style="border-bottom: #000000 1px solid;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></b></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">(313</font></td>
<td style="border-bottom: #000000 1px solid;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></td></tr>
<tr valign="bottom"><td style="text-indent: 6px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Income from Operations</font></td>
<td style="border-bottom: #000000 3px double;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">30,736</font></b></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">28,667</font></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">58,038</font></b></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">56,060</font></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td></tr></table> </div>
<div> <div>
<p style="text-align: left;"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">9. Segment Information</font></b></p>
<p style="text-align: left;"> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Operating segments are generally defined as components of an enterprise for which separate discrete financial information is available as the basis for management to allocate resources and assess performance.</font></p>
<p style="text-align: left;"> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Based on internal reporting and management structure, the Company has <font class="_mt">two</font> reportable segments: Company Drive-Ins and Franchise Operations. The Company Drive-Ins segment consists of the drive-in operations in which the Company owns a controlling ownership interest and derives its revenues from operating drive-in restaurants. The Franchise Operations segment consists of franchising activities and derives its revenues from royalties, initial franchise fees and lease revenues received from franchisees. The accounting policies of the segments are the same as those described in the Summary of Significant Accounting Policies in our most recent Annual Report on Form 10-K. Segment information for total assets and capital expenditures is not presented as such information is not used in measuring segment performance or allocating resources between segments.</font></p></div>
<div> </div><br />
<div>
<p style="text-align: left;"> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">The following table presents the revenues and income from operations for each reportable segment, along with reconciliation to reported revenue and income from operations:</font></p>
<div>
<table border="0" cellspacing="0">
<tr><td width="35%"> </td>
<td width="3%"> </td>
<td width="9%"> </td>
<td width="2%"> </td>
<td width="3%"> </td>
<td width="10%"> </td>
<td width="2%"> </td>
<td width="4%"> </td>
<td width="9%"> </td>
<td width="2%"> </td>
<td width="3%"> </td>
<td width="7%"> </td>
<td width="2%"> </td></tr>
<tr valign="bottom"><td align="left"> </td>
<td colspan="6" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">Three months ended</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">May 31,</font></b></td>
<td colspan="6" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">Nine months ended</font></b><br /><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">May 31,</font></b></td></tr>
<tr valign="bottom"><td align="left"> </td>
<td style="border-bottom: #000000 1px solid;" colspan="3" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">2012</font></b></td>
<td style="border-bottom: #000000 1px solid;" colspan="3" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">2011</font></b></td>
<td style="border-bottom: #000000 1px solid;" colspan="3" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">2012</font></b></td>
<td style="border-bottom: #000000 1px solid;" colspan="3" align="center"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">2011</font></b></td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Revenues:</font></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td></tr>
<tr valign="bottom"><td style="text-indent: 2px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Company Drive-Ins</font></td>
<td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">110,070</font></b></td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">113,745</font></td>
<td align="left"> </td>
<td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">294,037</font></b></td>
<td align="left"> </td>
<td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">297,454</font></td>
<td align="left"> </td></tr>
<tr valign="bottom"><td style="text-indent: 2px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Franchise Operations</font></td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">37,857</font></b></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">37,038</font></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">95,436</font></b></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">94,268</font></td>
<td align="left"> </td></tr>
<tr valign="bottom"><td style="text-indent: 2px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Unallocated revenues</font></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">1,500</font></b></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">1,315</font></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">3,317</font></b></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">3,045</font></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td></tr>
<tr valign="bottom"><td align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">149,427</font></b></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">152,098</font></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">392,790</font></b></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">394,767</font></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td></tr>
<tr><td colspan="13"> </td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Income from Operations:</font></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td></tr>
<tr valign="bottom"><td style="text-indent: 2px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Company Drive-Ins</font></td>
<td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">18,670</font></b></td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">17,734</font></td>
<td align="left"> </td>
<td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">38,764</font></b></td>
<td align="left"> </td>
<td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">38,389</font></td>
<td align="left"> </td></tr>
<tr valign="bottom"><td style="text-indent: 2px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Franchise Operations</font></td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">37,857</font></b></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">37,038</font></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">95,436</font></b></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">94,268</font></td>
<td align="left"> </td></tr>
<tr valign="bottom"><td style="text-indent: 2px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Unallocated income</font></td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">1,651</font></b></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">1,295</font></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">3,930</font></b></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">3,300</font></td>
<td align="left"> </td></tr>
<tr valign="bottom"><td style="text-indent: 2px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Unallocated expenses:</font></td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td>
<td align="left"> </td></tr>
<tr valign="bottom"><td style="text-indent: 6px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Selling, general and administrative</font></td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">(16,951</font></b></td>
<td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></b></td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">(17,212</font></td>
<td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">(48,452</font></b></td>
<td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></b></td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">(48,778</font></td>
<td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></td></tr>
<tr valign="bottom"><td style="text-indent: 6px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Depreciation and amortization</font></td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">(10,288</font></b></td>
<td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></b></td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">(10,139</font></td>
<td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></td>
<td align="left"> </td>
<td align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">(31,264</font></b></td>
<td align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></b></td>
<td align="left"> </td>
<td align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">(30,806</font></td>
<td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></td></tr>
<tr valign="bottom"><td align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Provision for impairment of long-lived</font><br /><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">assets</font></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">(203</font></b></td>
<td style="border-bottom: #000000 1px solid;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></b></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">(49</font></td>
<td style="border-bottom: #000000 1px solid;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">(376</font></b></td>
<td style="border-bottom: #000000 1px solid;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></b></td>
<td style="border-bottom: #000000 1px solid;" align="left"> </td>
<td style="border-bottom: #000000 1px solid;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">(313</font></td>
<td style="border-bottom: #000000 1px solid;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">)</font></td></tr>
<tr valign="bottom"><td style="text-indent: 6px;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">Income from Operations</font></td>
<td style="border-bottom: #000000 3px double;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">30,736</font></b></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">28,667</font></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="left"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></b></td>
<td style="border-bottom: #000000 3px double;" align="right"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">58,038</font></b></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td>
<td style="border-bottom: #000000 3px double;" align="left"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">$</font></td>
<td style="border-bottom: #000000 3px double;" align="right"><font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">56,060</font></td>
<td style="border-bottom: #000000 3px double;" align="left"> </td></tr></table></div>
<p style="margin: 0px;"> </p></div> </div>
48778000
17212000
48452000
16951000
4474000
3204000
51696000
48885000
918013000
939170000
30000000
4500000
56316000
59753000
3500000
<div> <p style="text-align: left;"><b><font style="font-family: TimesNewRomanPS-BoldMT,Times New Roman,Times,serif;" class="_mt" size="2">3. Stock Repurchase Program</font></b></p>
<p style="text-align: left;"> <font style="font-family: TimesNewRomanPSMT,Times New Roman,Times,serif;" class="_mt" size="2">On October 13, 2011, the Company's Board of Directors approved a stock repurchase program. Under the stock repurchase program, the Company was authorized to purchase up to $<font class="_mt">30.0</font> million of its outstanding shares of common stock through August 31, 2012. During the first nine months of fiscal year 2012, approximately <font class="_mt">3.5</font> million shares were acquired pursuant to this program for a total cost of $<font class="_mt">25.5</font> million. As of May 31, 2012, the total remaining amount authorized for repurchase was $<font class="_mt">4.5</font> million. Subsequent to the end of the third quarter of fiscal year 2012, the Company purchased the remaining amount authorized and completed its stock repurchase program.</font></p> </div>
866317000
890285000
25500000
-1100000
61873000
62000000
60767000
59961000
61723000
61842000
60736000
59936000
Anti-dilutive securities consist of stock options and unvested restricted stock units that were not included in the computation of diluted earnings per share because either the exercise price of the options was greater than the average market price of the common stock or the total assumed proceeds under the treasury stock method resulted in negative incremental shares and thus the inclusion would have been anti-dilutive.