Equity Incentive Plan

3 Months Ended

Aug. 31, 2011

Equity Incentive Plan [Abstract]

Equity Incentive Plan

Note 5: Equity Incentive Plan

Our 2005 Equity Incentive Plan (the “Equity Incentive Plan”) authorizes our Board of Directors to grant incentive and non-statutory stock option grants, stock appreciation rights, restricted stock awards, restricted stock units, performance unit awards and performance share awards covering a maximum of 1,000 shares of our common stock. The Equity Incentive Plan replaced our prior stock option plans, under which there are no outstanding options. Pursuant to the Equity Incentive Plan, we have granted incentive and non-statutory options to directors, officers and key employees at prices not less than 100% of the fair market value on the day of grant. In addition, we have granted restricted stock and restricted stock units to directors, officers and key employees. The Equity Incentive Plan provides for a variety of vesting dates with the majority of the outstanding grants vesting at a rate of one-third per year over a period of three years from the date of grant. All outstanding options expire in October 2011.

Stock Options

The following table summarizes certain information relative to options for common stock:

					Weighted
					Average
			Weighted		Remaining
			Average		Contractual
			Exercise		Term (in
	Options		Price		years)
Outstanding at May 31, 2011		36	$	17.69
Granted		—		—
Exercised		—		—
Forfeited/canceled		—		—
Outstanding at August 31, 2011		36	$	17.69		0.1
Vested and expected to vest at August 31, 2011		36	$	17.69		0.1
Vested and exercisable at August 31, 2011		36	$	17.69		0.1

There were no stock options granted or vested during the three months ended August 31, 2011 and 2010. The aggregate intrinsic value of options exercised is calculated as the difference between the exercise price of the underlying awards and the closing price of our common stock on the Nasdaq Stock Market on the date of measurement. The aggregate intrinsic value of options exercised during the three months ended August 31, 2011 and 2010 was $0 and $7, respectively. Shares of newly issued common stock are issued upon any exercise of stock options.

Restricted Stock Units

Restricted stock units represent the right to receive one share of our common stock, provided that the vesting conditions are satisfied. The following table represents restricted stock unit activity for the three months ended August 31, 2011:

				Weighted
				Average
				Grant
	Restricted			Date
	Stock Units			Fair Value
Nonvested at May 31, 2011		204		$	11.36
Granted		84			16.83
Vested		(78	)		10.86
Forfeited/canceled		—			—
Nonvested at August 31, 2011		210		$	13.76

We granted 84 and 96 restricted stock units during the three months ended August 31, 2011 and 2010, respectively. As of August 31, 2011, we have unrecognized share-based compensation cost of approximately $2,567 associated with restricted stock unit awards. This cost is expected to be recognized over a weighted-average period of approximately 2.2 years.

Accounting for Share Based Payments

Accounting guidance requires all share-based payments to employees, including grants of employee stock options, restricted stock and restricted stock units, to be recognized as compensation expense in the consolidated financial statements based on their fair values. Compensation expense is recognized over the period that an employee provides service in exchange for the award.

We use the Black-Scholes option pricing model to calculate the fair value of any option grant. Our computation of expected volatility is based on historical volatility. Our computation of expected term is determined based on historical experience of similar awards, giving consideration to the contractual terms of the stock-based awards, vesting schedules and expectations of future employee behavior. The expected term represents the period that our option awards are expected to be outstanding and was determined based on historical experience of similar awards. The risk-free interest rate is based on U.S. Treasury zero-coupon issues with a term equal to the expected term of the option at the date of grant. Forfeitures are estimated at the date of grant based on historical experience. We use the market price of our common stock on the date of grant to calculate the fair value of each grant of restricted stock and restricted stock units.

We recorded $326 and $195 of stock-based compensation as part of selling, general and administrative expenses for the three months ended August 31, 2011 and 2010, respectively.

We receive a tax deduction for certain stock option exercises during the period the options are exercised, generally for the excess of the fair value of our common stock at the date of exercise over the exercise price of the options, and dividends paid on vested restricted stock units. Excess tax benefits are realized tax benefits from tax deductions for exercised options in excess of the deferred tax asset attributable to stock compensation costs for such options. The total tax benefit realized from stock option exercises, shares issued and dividend payments for vested restricted stock units for the three months ended August 31, 2011 and 2010 was $36 and $14, respectively. Cash received from stock option exercises was $0 and $149 for the three months ended August 31, 2011 and 2010, respectively.