Note 3. Stock-Based Compensation

The Company accounts for all share-based payments in accordance with ASC Topic 718, "Compensation—Stock Compensation" ("ASC 718"). Stock‑based compensation expense included in operating expenses for the thirteen and thirty-nine week periods ended May 28, 2016 and May 30, 2015 was as follows:


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	May 28,		May 30,		May 28,		May 30,
	2016		2015		2016		2015
Stock options(1)	$	1,044	$	1,029	$	3,296	$	3,699
Restricted share awards		1,420		1,852		4,619		6,381
Restricted stock units		785		142		2,197		967
Associate Stock Purchase Plan		54		74		190		252
Total stock-based compensation	$	3,303	$	3,097	$	10,302	$	11,299

(1)

Tax benefits related to these expenses for the thirteen week periods ended May 28, 2016 and May 30, 2015 were $396 and $391, respectively, and for the thirty-nine week periods ended May 28, 2016 and May 30, 2015 were $1,252 and $1,406, respectively.

Stock options

The fair value of each option grant is estimated on the date of grant using the Black‑Scholes option pricing model with the following assumptions:



		Thirty-Nine Weeks Ended
		May 28,			May 30,
		2016			2015
Expected life (in years)		3.9			3.9
Risk-free interest rate		1.09	%		1.09	%
Expected volatility		21.82	%		24.49	%
Expected dividend yield		2.40	%		1.70	%
Weighted-average grant-date fair value	$	8.03		$	14.06

A summary of the Company’s stock option activity for the thirty-nine week period ended May 28, 2016 is as follows:



	Options	Weighted-Average Exercise Price per Share		Weighted-Average Remaining Contractual Term (in years)	Aggregate Intrinsic Value
Outstanding on August 29, 2015	1,274	$	73.10
Granted	586		58.90
Exercised	(99)		51.25
Canceled/Forfeited	(56)		75.87
Outstanding on May 28, 2016	1,705	$	69.40	4.7	$	14,405
Exercisable on May 28, 2016	672	$	70.48	3.2	$	4,799

The unrecognized share‑based compensation cost related to stock option expense at May 28, 2016 was $8,285 and will be recognized over a weighted average period of 2.7 years. The total intrinsic value of options exercised, which represents the difference between the exercise price and market value of common stock measured at each individual exercise date, during the thirty-nine week periods ended May 28, 2016 and May 30, 2015 was $2,164 and $2,466, respectively.

Restricted share awards

A summary of the non‑vested restricted share award (“RSA”) activity under the Company’s 2005 Omnibus Incentive Plan and 2015 Omnibus Incentive Plan for the thirty-nine week period ended May 28, 2016 is as follows:



	Shares	Weighted-Average Grant-Date Fair Value
Non-vested restricted share awards at August 29, 2015	391	$	75.39
Granted	1		62.31
Vested	(110)		67.34
Canceled/Forfeited	(10)		78.25
Non-vested restricted share awards at May 28, 2016	272	$	78.47

The fair value of each RSA is the closing stock price on the New York Stock Exchange of the Company’s Class A common stock on the date of grant. Upon vesting, a portion of the RSA award may be withheld to satisfy the minimum statutory withholding taxes. The remaining RSAs will be settled in shares of the Company’s Class A common stock when vested. The unrecognized compensation cost related to RSAs at May 28, 2016 was $10,845 and will be recognized over a weighted average period of 2.5 years.

Restricted stock units

A summary of the Company’s non-vested Restricted Stock Unit (“RSU”) award activity for the thirty-nine week period ended May 28, 2016 is as follows:



	Shares		Weighted- Average Grant- Date Fair Value
Non-vested restricted stock unit awards at August 29, 2015	62	$	55.09
Granted	207		58.83
Vested	(2)		58.89
Canceled/Forfeited	(4)		58.78
Non-vested restricted stock unit awards at May 28, 2016	263	$	57.94

The fair value of each RSU is the closing stock price on the New York Stock Exchange of the Company’s Class A common stock on the date of grant. Upon vesting, a portion of the RSU award may be withheld to satisfy the minimum statutory withholding taxes. The remaining RSUs will be settled in shares of the Company’s Class A common stock when vested. These awards accrue dividend equivalents on outstanding units (in the form of additional stock units) based on dividends declared on the Company’s Class A common stock and these dividend equivalents convert to unrestricted common stock on the vesting dates of the underlying RSUs. The dividend equivalents are not included in the RSU table above. The unrecognized compensation cost related to the RSUs at May 28, 2016 was $9,503 and is expected to be recognized over a weighted average period of 3.3 years.