Note 3. Stock-Based Compensation

The Company accounts for all share-based payments in accordance with ASC Topic 718, "Compensation — Stock Compensation" ("ASC 718"). The stock-based compensation expense related to the stock option plans and the Associate Stock Purchase Plan included in operating expenses was $1,329 and $1,391 for the thirteen week periods ended June 1, 2013 and May 26, 2012, respectively and $4,097 and $4,310 for the thirty-nine week periods ended June 1, 2013 and May 26, 2012, respectively. Tax benefits related to these expenses for the thirteen week periods ended June 1, 2013 and May 26, 2012 were $483 and $501, respectively, and for the thirty-nine week periods ended June 1, 2013 and May 26, 2012 were $1,487 and $1,569, respectively.

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
	June 1, 2013			May 26, 2012
Expected life (in years)		3.8			4.8
Risk-free interest rate		0.55	%		1.01	%
Expected volatility		32.86	%		35.20	%
Expected dividend yield		1.70	%		1.70	%

A summary of the Company's stock option activity for the thirty-nine weeks ended June 1, 2013 is as follows:



	Options			Weighted- Average Exercise Price per Share		Weighted- Average Remaining Contractual Term (in years)		Aggregate Intrinsic Value
Outstanding on September 1, 2012		1,377		$	49.79
Granted		360			69.52
Exercised		(469	)		42.65
Canceled		(4	)		62.43
Outstanding on June 1, 2013		1,264		$	58.01		4.69	$	31,162
Exercisable on June 1, 2013		420		$	48.65		3.36	$	14,303

The weighted-average grant-date fair values of the stock options granted for the thirty-nine week periods ended June 1, 2013 and May 26, 2012 were $15.33 and $17.67, respectively. The unrecognized share-based compensation cost related to stock option expense at June 1, 2013 was $9,285 and will be recognized over a weighted average period of 1.7 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 June 1, 2013 and May 26, 2012 were $15,140 and $14,445, respectively.

A summary of the non-vested restricted share award activity under the Company's 2005 Omnibus Incentive Plan (the "Plan") for the thirty-nine weeks ended June 1, 2013 is as follows:



	Shares			Weighted- Average Grant-Date Fair Value
Non-vested restricted share awards at September 1, 2012		535		$	52.37
Granted		141			70.37
Vested		(157	)		45.11
Canceled/Forfeited		(10	)		58.57
Non-vested restricted share awards at June 1, 2013		509		$	59.47

Stock-based compensation expense recognized for the restricted share awards was $2,024 and $1,919 for the thirteen week periods ended June 1, 2013 and May 26, 2012, respectively, and $6,301 and $5,512 for the thirty-nine week periods ended June 1, 2013 and May 26, 2012, respectively. The unrecognized compensation cost related to restricted share awards granted under the Plan at June 1, 2013 was $18,071 and will be recognized over a weighted average period of 2.2 years.

A summary of the Company's non-vested restricted stock unit award activity including dividend equivalent units for the thirty-nine weeks ended June 1, 2013 is as follows:



	Shares		Weighted- Average Grant-Date Fair Value
Non-vested restricted stock unit awards at September 1, 2012		192	$	54.90
Granted		3		75.30
Vested		—		—
Canceled/Forfeited		—		—
Non-vested restricted stock unit awards at June 1, 2013		195	$	55.23

Stock-based compensation expense recognized for the restricted stock units was $532 and $529 for the thirteen week periods ended June 1, 2013 and May 26, 2012, respectively, and $1,591 and $1,588 for the thirty-nine week periods ended June 1, 2013 and May 26, 2012. The unrecognized compensation cost related to the restricted stock units at June 1, 2013 was $4,490 and is expected to be recognized over a period of 2.4 years.

- Definition

The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 718

-SubTopic 10

-Section 50

-Paragraph 1

-URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5047-113901

Reference 2: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 718

-SubTopic 10

-Section 50

-Paragraph 2

-URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5070-113901

Reference 3: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 505

-SubTopic 50

-Section 50

-Paragraph 1

-URI http://asc.fasb.org/extlink&oid=6406099&loc=d3e25284-112666

Reference 4: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 123R

-Paragraph 64, 65, A240

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 5: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 718

-SubTopic 40

-Section 50

-Paragraph 1

-URI http://asc.fasb.org/extlink&oid=6418621&loc=d3e17540-113929

Reference 6: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 718

-SubTopic 10

-Section 50

-Paragraph 4

-URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5444-113901

Reference 7: http://www.xbrl.org/2003/role/presentationRef

-Publisher SEC

-Name Staff Accounting Bulletin (SAB)

-Number Topic 14

Reference 8: http://www.xbrl.org/2003/role/presentationRef

-Publisher AICPA

-Name Statement of Position (SOP)

-Number 93-6

-Paragraph 53

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

+ Details