Accounting for Stock-Based Compensation

9 Months Ended

Feb. 28, 2013

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 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:

	Nine Months Ended
	February 28/29,
	2013		2012
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 nine-month periods ended February 28, 2013 and February 29, 2012 was $0.3 million and $3.3 million, respectively.   Expense charged to operations for stock options was $1.0 million and $1.1 million during the third quarters of fiscal years 2013 and 2012, respectively, and $2.6 million and $3.3 million during the nine months ended February 28, 2013 and February 29, 2012, 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 Directors with a grant date fair value per share of $11.56.  Expense charged to operations for restricted stock was $2.3 million and $2.7 million during the third quarters of fiscal years 2013 and 2012, respectively, and $5.4 million and $6.6 million during the nine months ended February 28, 2013 and February 29, 2012, respectively.