Share-based Compensation

12 Months Ended

Aug. 25, 2012

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Share-based Compensation

12. Share-based Compensation

In fiscal 2012, a total of 3,153 shares of unrestricted stock were granted to some of the Company's non-employee directors. In fiscal 2011, a total of 6,000 shares of restricted stock were granted to the Company's non-employee Directors subject to vesting in full one year from the date of grant. Accordingly, compensation expense related to the 2012 unrestricted stock was recognized on the date of grant while the compensation expense related to the 2011 restricted stock was recognized ratably over the vesting period.

In fiscal 2012, the Company granted a total of 8,620 stock appreciation rights under the 2010 Plan to the Company's non-employee directors.  Such stock appreciation rights were fully vested upon grant, expire on the earlier of the eighth anniversary of the grant date or the second anniversary of the date that the director ceases to be a member of the Board of Directors and must be settled in stock at the time of exercise.  Accordingly, compensation expense related to the stock appreciation rights were recognized on the date of grant.

On April 5, 2010, the Company entered into a Restricted Stock Award Agreement (the "Performance Criteria Restricted Stock Award Agreement") with its Chief Executive Officer ("CEO") pursuant to which the Company granted 350,000 shares (the "Performance Restricted Shares") of restricted common stock to the CEO.  The Performance Restricted Shares are earned if the Company achieves certain consolidated revenues and adjusted operating margins as set forth in the Performance Criteria Restricted Stock Award Agreement during certain performance periods in fiscal 2010, fiscal 2011 and fiscal 2012 as set forth in such agreement (collectively, the "Performance Criteria").  As of August 25, 2012, the performance criteria for fiscal 2010, fiscal 2011 and fiscal 2012 have been achieved and the related restricted shares have been earned.  The Performance Restricted Shares earned upon achievement of the Performance Criteria will vest in four equal amounts on the third, fourth, fifth and sixth anniversaries of the grant date provided that the CEO continues to be employed by the Company on each such date.  As the Company believed that it was probable that the Performance Criteria would be met, compensation expense began being recognized as of the grant date of these shares.  As required by accounting rules, the Company is recognizing compensation expense for each vesting tranche of the Performance Restricted Shares ratably from the service inception date to the vesting date for each tranche.  In the event Mr. Croatti's employment with the Company is terminated by the Company without cause or by reason of his death or disability, the Performance Restricted Shares will automatically vest in full.

Also on April 5, 2010, the Company entered into a Restricted Stock Award Agreement (the "Restricted Stock Award Agreement") with the CEO pursuant to which the Company granted 50,000 shares (the "Restricted Shares") of restricted common stock to the CEO. The Restricted Shares will vest in equal amounts on each of the first six anniversaries of the grant date provided that the CEO continues to be employed by the Company on each such date.  Compensation expense related to the Restricted Shares is being recognized ratably over the vesting period.  In the event Mr. Croatti's employment with the Company is terminated by the Company without cause or by reason of his death or disability, the Restricted Shares will automatically vest in full.

For the Performance Criteria Restricted Stock Award Agreement and the Restricted Stock Award Agreement, the fair value of the restricted shares was the closing price on April 5, 2010, which was $51.39.

Compensation expense for all share-based compensation, which includes Share-Based Awards and restricted stock grants, for the five fiscal years subsequent to August 25, 2012 is as follows (in thousands):

	Share-Based		Restricted
	Awards		Stock		Total
2013	$	1,281	$	4,066	$	5,347
2014		1,004		2,725		3,729
2015		681		1,697		2,378
2016		360		680		1,040
2017		47		-		47
Total	$	3,373	$	9,168	$	12,541

As of August 25, 2012, the total compensation cost not yet recognized related to non-vested share-based compensation grants was approximately $12.5 million.  The weighted average periods over which compensation cost for Share-Based Awards and restricted stock will be recognized are 2.5 years and 2.1 years, respectively.

The following table summarizes the Share-Based Award activity for the fiscal year ended August 25, 2012:

	Number of Shares			Weighted Average Exercise Price
Outstanding, August 27, 2011		527,400		$	38.48
Granted		120,120			50.55
Exercised		(73,250	)		32.91
Forfeited		(14,000	)		40.59
Outstanding, August 25, 2012		560,270		$	41.74
Exercisable, August 25, 2012		113,570		$	40.43