Accounting for Stock-Based Compensation

3 Months Ended

Aug. 31, 2012

Accounting for Stock-Based Compensation

Accounting for Stock-Based Compensation

Note 3 — Accounting for Stock-Based Compensation

Stock Options

In July 2012, as part of our annual long-term stock incentive compensation, we granted 958,180 stock options to eligible employees at an exercise price of $12.90 and weighted average fair value of $4.6 million.  The fair value of stock options is estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions:

	Three Months Ended
	August 31,
	2012		2011
Risk-free interest rate	0.6	%	1.5	%
Expected volatility of common stock	51	%	46	%
Dividend yield	2.3	%	1.0	%
Expected option term in years	5.4		5.7

The total intrinsic value of stock options exercised during the three-month periods ended August 31, 2012 and 2011 was zero and $3.3 million, respectively.   Expense charged to operations for stock options during the three-month periods ended August 31, 2012 and 2011 was $0.7 and $1.1 million, respectively.

Restricted Stock

In July 2012, as part of our annual long-term stock incentive compensation, we granted 53,280 shares of performance-based restricted stock and 65,780 restricted shares to eligible employees.  The grant date fair value per share was $12.90.  We also granted 45,000 restricted shares to members of the Board of Director with a grant date fair value per share of $11.56.  Expense charged to operations for restricted stock during the three-month periods ended August 31, 2012 and 2011 was $2.2 million and $1.5 million, respectively.