Accounting For Stock-Based Compensation

6 Months Ended

Jan. 31, 2013

Accounting For Stock-Based Compenstation [Abstract]

Accounting For Stock-Based Compensation

Note D – Accounting for Stock-Based Compensation

          Stock-based compensation expense is recognized using the fair-value method for all awards. In addition to granting stock options, the Company also granted reload options related to options previously granted which were exercised during the first six months ended January 31, 2013. A reload stock option is granted for the number of shares tendered as payment for the exercise price and tax withholding obligation upon the exercise of a stock option with a reload provision. The option price of the reload option is equal to the market price of the stock on the date of exercise and will expire on the same date as the original option which was exercised. The Company determined the fair value of its option awards using the Black-Scholes option pricing model. The following assumptions were used to value the options, including reload options which generally have a shorter contractual life, granted during the six months ended January 31, 2013: range of less than 1 year to 8 years expected life; expected volatility range of 23.4 percent to 29.5 percent; risk-free interest rate range of 0.02 percent to 1.57 percent; and annual dividend yield of 1.0 percent. The expected life for options granted during the period represents the period of time that the options are expected to be outstanding based on the contractual life and historical data of option holder exercise and termination behavior. Expected volatilities are based upon historical volatility of the Company's stock over a period at least equal to the expected life of each option grant. Option grants are priced at the fair market value of the Company's stock on the date of grant. The weighted average fair value for options granted during the six months ended January 31, 2013 and 2012 was $8.33 per share and $9.43 per share, respectively. For the three and six months ended January 31, 2013, the Company recorded pre-tax stock option expense of $4.1 million and $5.5 million, respectively, and recorded $1.4 million and $1.8 million, respectively, of related tax benefit. For the three and six months ended January 31, 2012, the Company recorded pre-tax stock option expense of $4.3 million and $5.1 million, respectively, and recorded $1.5 million and $1.7 million, respectively, of related tax benefit.

          The following table summarizes stock option activity during the six months ended January 31, 2013:

	Options Outstanding			Weighted Average Exercise Price
Outstanding at July 31, 2012		8,056,327		$	20.97
Granted		910,442			33.77
Exercised		(1,148,958	)		14.00
Canceled		(66,727	)		34.20
Outstanding at January 31, 2013		7,751,084			23.39

          The total intrinsic value of options exercised during the six months ended January 31, 2013 and 2012 was $24.5 million and $22.3 million, respectively.

          The following table summarizes information concerning outstanding and exercisable options as of January 31, 2013:

Range of Exercise Prices	Number Outstanding		Weighted Average Remaining Contractual Life (Years)		Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercise Price
$0.00 to $15.89		1,496,222		1.58	$	15.26		1,496,222	$	15.26
$15.90 to $20.89		1,985,525		4.27		17.44		1,985,525		17.44
$20.90 to $25.89		1,423,462		6.24		21.78		1,423,462		21.78
$25.90 to $30.89		927,849		7.85		29.15		615,711		29.15
$30.90 and above		1,918,026		8.98		34.30		427,247		34.78
		7,751,084		5.71		23.39		5,948,167		20.39

          At January 31, 2013, the aggregate intrinsic value of options outstanding and exercisable was $110.2 million and $102.4 million, respectively.

          As of January 31, 2013, there was $10.2 million of total unrecognized compensation expense related to non-vested stock options granted under the 2010 Master Stock Incentive Plan. This unvested expense is expected to be recognized during the remainder of Fiscal Years 2013, 2014, 2015, and 2016.