STOCK-BASED COMPENSATION

6 Months Ended

Jul. 29, 2012

STOCK-BASED COMPENSATION

NOTE C. STOCK-BASED COMPENSATION

Equity Award Programs

Our Amended and Restated 2001 Long-Term Incentive Plan (the “Plan”) provides for grants of incentive stock options, nonqualified stock options, stock-settled stock appreciation rights (collectively, “option awards”), restricted stock awards, restricted stock units, deferred stock awards (collectively, “stock awards”) and dividend equivalents up to an aggregate of 25,759,903 shares. As of July 29, 2012, there were 7,746,763 shares available for future grant. Awards may be granted under the Plan to officers, employees and non-employee Board members of the company or any parent or subsidiary. Annual grants are limited to 1,000,000 shares covered by option awards and 400,000 shares covered by stock awards on a per person basis. All grants of option awards made under the Plan have a maximum term of seven years. The exercise price of these option awards is not less than 100% of the closing price of our stock on the day prior to the grant date. Option awards granted to employees generally vest over a period of four to five years. Stock awards granted to employees generally vest over a period of four years. Certain option awards, stock awards and other agreements contain vesting acceleration clauses resulting from events including, but not limited to, retirement, merger or a similar corporate event. Option and stock awards granted to non-employee Board members generally vest in one year. Non-employee Board members automatically receive stock awards on the date of their initial election to the Board and annually thereafter on the date of the annual meeting of stockholders (so long as they continue to serve as a non-employee Board member). Shares issued as a result of award exercises will be funded with the issuance of new shares.

Stock-Based Compensation Expense

We measure and record stock-based compensation expense in our consolidated financial statements for all employee stock-based awards using a fair value method. During the thirteen and twenty-six weeks ended July 29, 2012, we recognized total stock-based compensation expense, as a component of selling, general and administrative expenses, of $7,099,000 and $15,092,000, respectively (including stock-based compensation expense of $3,019,000 for the twenty-six weeks ended July 29, 2012, associated with the retirement of our former Executive Vice President, Chief Operating and Chief Financial Officer). During the thirteen and twenty-six weeks ended July 31, 2011, we recognized total stock-based compensation expense of $7,029,000 and $12,256,000, respectively.

Stock Options

The following table summarizes our stock option activity during the twenty-six weeks ended July 29, 2012:

	Shares
Balance at January 29, 2012		934,696
Granted		0
Exercised		(309,006	)
Canceled		(680	)
Balance at July 29, 2012 (100% vested)		625,010

Stock-Settled Stock Appreciation Rights

The following table summarizes our stock-settled stock appreciation right activity during the twenty-six weeks ended July 29, 2012:

	Shares
Balance at January 29, 2012		3,941,642
Granted		0
Converted into common stock		(635,455	)
Canceled		(181,213	)
Balance at July 29, 2012		3,124,974
Vested at July 29, 2012		1,332,811
Vested and expected to vest at July 29, 2012		2,483,470

Restricted Stock Units

The following table summarizes our restricted stock unit activity during the twenty-six weeks ended July 29, 2012:

	Shares
Balance at January 29, 2012		2,293,851
Granted		1,082,308
Released		(369,285	)
Canceled		(292,984	)
Balance at July 29, 2012		2,713,890
Vested and expected to vest at July 29, 2012		1,918,801