STOCK-BASED COMPENSATION

3 Months Ended

Apr. 28, 2012

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

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION

The following table summarizes the Company’s stock-based compensation expense (in thousands):

	Thirteen Weeks Ended
	April 28, 2012		April 30, 2011
Deferred Awards	$	2,377	$	2,384
Performance Awards	620		359
Total stock-based compensation expense (1)	$	2,997	$	2,743

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(1) During the First Quarter 2012 and First Quarter 2011, approximately $0.2 million and $0.4 million, respectively, were included in cost of sales. All other stock-based compensation is included in selling, general & administrative expenses.

The Company recognized a tax benefit related to stock-based compensation expense of $1.2 million and $1.1 million for the First Quarter 2012 and First Quarter 2011, respectively.

Awards Granted During the First Quarter 2012

Pursuant to an employment agreement and amendments thereto with its Chief Executive Officer and President, the Company granted Deferred Awards of 196,768 shares of its common stock that vest over three years.  In addition, the Company granted Performance Awards that provide for the issuance of 100,180 Target Shares if the Company meets its operating income target for fiscal 2012.  The Performance Awards have a minimum threshold that would provide 50% of the Target Shares and a maximum target that would provide 200% of the Target Shares.  Depending on the final operating income, the percentage earned can be 0%, or any percentage including and between 50% and 200%.  Any earned Performance Awards cliff vest in February 2014.

Additionally, during the First Quarter 2012, the Company granted Deferred Awards of 221,830 shares of its common stock to employees, including new hire awards, which vest ratably over three years.  The Company also granted Performance Awards to employees that provide for the issuance of 114,560 Target Shares if the Company meets its operating income target for fiscal 2012.  The Performance Awards have a minimum threshold that would provide 50% of the Target Shares and a maximum target that would provide 200% of the Target Shares.  Depending on the final operating income, the percentage earned can be 0%, or any percentage including and between 50% and 200%.  Any earned Performance Awards cliff vest after three years.

On January 29, 2012, the Company made its annual grant of Deferred Awards to the members of its Board of Directors.  Total shares of common stock granted were 16,032 and vest after one year.

Changes in the Company’s Unvested Stock Awards during the First Quarter 2012

Deferred Awards

	Number of Shares		Weighted Average Grant Date Fair Value
	(in thousands)
Unvested Deferred Awards beginning of period	406		$	47.96
Granted	435		48.68
Vested	(99	)	49.29
Forfeited	(25	)	49.21
Unvested Deferred Awards, end of period	717		$	48.17

Total unrecognized stock-based compensation expense related to unvested Deferred Awards approximated $31.6 million as of April 28, 2012, which will be recognized over a weighted average period of approximately 2.6 years.

Performance Awards

	Number of Performance Shares (1)		Weighted Average Grant Date Fair Value
	(in thousands)
Unvested Performance Awards, beginning of period	6		$	46.08
Granted	215		48.72
Vested	(1	)	45.38
Forfeited	(1	)	47.30
Unvested Performance Awards, end of period	219		$	48.67

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(1) For those awards in which the performance period is complete, the number of unvested shares is based on actual shares that will vest upon completion of the service period. For those awards in which the performance period is not yet complete, the number of unvested shares is based on the participants earning their Target Shares at 100%.  As of April 28, 2012, the Company estimates that for those awards in which the performance period is not yet complete, participants will earn 100% of their Target Shares. The cumulative expense recognized reflects changes in estimates as they occur.

Based on the current number of Performance Awards expected to be earned, the total unrecognized stock-based compensation expense related to unvested Performance Awards approximated $10.1 million as of April 28, 2012, which will be recognized over a weighted average period of approximately 2.5 years.

Stock Options

At April 28, 2012, there were no unvested stock options.

Outstanding Stock Options

Changes in the Company’s outstanding stock options for First Quarter 2012 were as follows:

	Number of Options		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life	Aggregate Intrinsic Value
	(in thousands)				(in years)	(in thousands)
Options outstanding at beginning of period	154		$	30.98	4.2	$	2,943
Granted	—		—		—	—
Exercised	(1	)	31.94		N/A	29
Forfeited	(1	)	24.60		N/A	13
Options outstanding and exercisable at end of period	152		$	31.00	4.0	$	2,397