2. ACQUISITIONS

In June 2010, we signed an agreement to purchase a 26% non-controlling interest in Eastern Condiments Private Limited (Eastern) for approximately $35 million. Eastern, based in India, is a leading brand of spices, seasonings and other related food products in India and the Middle East. The completion of the non-controlling interest is expected to occur in our fourth quarter of 2010 subject to regulatory approval.

3. EARNINGS PER SHARE AND STOCK ISSUANCES

The following table sets forth the reconciliation of average shares outstanding (in millions):

The following table sets forth the stock options and RSUs for the three and nine months ended August 31, 2010 and 2009 which were not considered in our earnings per share calculation since they were anti-dilutive.

The following table sets forth the common stock activity for the three and nine months ended August 31, 2010 and 2009 under the Company's stock option and employee stock purchase plans and the repurchases of common stock under its stock repurchase program (in millions):

As of August 31, 2010, $0.9 million remained of the $400 million share repurchase authorization that had been authorized by the Board of Directors in June 2005. In June 2010, our Board of Directors authorized a new share repurchase program to purchase up to $400 million of our outstanding shares.

4. COMPREHENSIVE INCOME

The following table sets forth the components of comprehensive income (in millions):

The other comprehensive income (loss) balances in the table above are net of deferred tax benefit (expense) of $1.1 million and ($3.7) million for the three and nine months ended August 31, 2010, respectively, and $0.2 million and $1.6 million for the three and nine months ended August 31, 2009, respectively.

The following table sets forth the components of accumulated other comprehensive (loss) income, net of tax where applicable (in millions):

5. PENSION AND POSTRETIREMENT BENEFITS

The following table presents the components of our pension expense of the defined benefit plans for the three months ended August 31 (in millions):

The following table presents the components of our pension expense of the defined benefit plans for the nine months ended August 31 (in millions):

During the nine months ended August 31, 2010 and 2009, we made $47.5 million and $52.2 million, respectively, in total contributions to our pension plans. Total contributions to our pension plans in 2010 are expected to be approximately $55 million. Total contributions to our pension plans in fiscal year 2009 were $72.3 million.

The following table presents the components of our other postretirement benefits expense (in millions):

6. STOCK-BASED COMPENSATION

The following table sets forth the stock-based compensation recorded in selling, general and administrative (SG&A) expense (in millions):

Our 2010 annual grant of stock options and restricted stock units (RSU) occurred in the second quarter, similar to the 2009 annual grant. The weighted-average grant-date fair value of an option granted in 2010 was $6.88 and in 2009 was $5.04 under a lattice pricing model. The fair values of option grants in the stated periods were computed using the following range of assumptions for our various stock compensation plans:

The following is a summary of all option activity for the nine months ended August 31:

As of August 31, 2010 the intrinsic value (the difference between the exercise price and the market price) for all options outstanding was $74.8 million and for exercisable options was $63.9 million. The total intrinsic value of all options exercised during the nine months ended August 31, 2010 and 2009 was $39.5 million and $7.9 million, respectively.

The following is a summary of all of our RSU activity for the nine months ended August 31, 2010 and 2009:

7. RESTRUCTURING ACTIVITIES

In November 2005, the Board of Directors approved a restructuring plan to consolidate our global manufacturing, rationalize our distribution facilities, improve our go-to-market strategy, eliminate administrative redundancies and rationalize our joint venture partnerships. From 2005 through 2009, we recorded total pre-tax charges of $128.7 million for this program.

As of November 30, 2009 this restructuring program was completed and all costs had been accrued.

During 2010 and 2009, the following cash was spent on our restructuring plan (in millions):

The cash received in 2010 includes $5.9 million in proceeds on the sale of our manufacturing facility in The Netherlands.

The following is a summary of restructuring activities for 2009 (in millions):

The restructuring charges incurred in 2009 related to the consolidation of production facilities in Europe, including the closure of our manufacturing plant in The Netherlands, and the reorganization of distribution networks in the U.K.

8. INCOME TAXES

The total amount of unrecognized tax benefits as of August 31, 2010 and November 30, 2009 were $15.9 million and $31.2 million, respectively. There was a decrease of $18.1 million in the gross liability for uncertain tax positions related to the expiration of statutes of limitations in various jurisdictions, the completion of a tax audit and the settlement of tax litigation. This decrease was partially offset by an increase of $2.8 million, of which $0.5 million relates to prior years and $2.3 million relates to 2010. We do not anticipate a significant change to the total amount of unrecognized tax benefits within the next twelve months.

We record interest and penalties on income taxes in income tax expense. We had accrued $0.9 million and $3.9 million of interest and penalties related to unrecognized tax benefits as of August 31, 2010 and November 30, 2009, respectively.

Income taxes for the three months and nine months ended August 31, 2010 include $16.1 million and $20.8 million, respectively, in discrete tax benefits. The discrete tax benefits in the third quarter of 2010 are mainly due to a $13.9 million reversal of a tax accrual for a closed tax year. This tax accrual was recorded in a prior period based on uncertainties about the tax aspects of transactions where we reorganized our European operations and divested certain of our joint ventures. In addition to the $13.9 million reversal, there were also other reversals of accruals for closed tax years and a tax benefit for the adjustment to a prior year tax provision after the actual tax return was filed. The discrete tax benefits for the nine months ended August 31, 2010 include the benefits noted in the third quarter and additional tax benefits recorded in the first six months of 2010 based on the settlement of tax audits.

Income taxes for the three months and nine months ended August 31, 2009 include $1.6 million and $2.8 million, respectively, of net discrete tax benefits. For the quarter, there are $3.0 million of benefits from adjustments to prior year tax accruals based on final tax return filings. This was partially offset by $1.4 million of a valuation allowance set up for certain deferred tax assets that may not be realized in future periods. For the year, there are $4.2 million of benefits from settlement of tax audits and adjustments to prior year tax accruals based on final tax return filings. This was partially offset by $1.4 million of a valuation allowance set up for certain deferred tax assets that may not be realized in future periods.

9. FINANCIAL INSTRUMENTS

We use derivative financial instruments to enhance our ability to manage risk, including foreign currency and interest rate exposures, which exist as part of our ongoing business operations. We do not enter into contracts for trading purposes, nor are we a party to any leveraged derivative instrument. The use of derivative financial instruments is monitored through regular communication with senior management and the use of written guidelines.

As of August 31, 2010, the maximum time frame for our foreign exchange forward contracts is 15 months. For all derivatives, the net amount of other comprehensive income expected to be reclassified in the next 12 months is $1.3 million as a reduction of earnings.

All derivatives are recognized at fair value in the balance sheet and recorded in either current or noncurrent other assets or other accrued liabilities or other long-term liabilities depending upon nature and maturity.

The following table discloses the fair values of derivative instruments on our balance sheet as of August 31, 2010 and 2009 (in millions):

As of August 31, 2010