Stock-Based Compensation

6 Months Ended

Jan. 31, 2014

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

Disclosure of Compensation Related Costs, Share-based Payments

STOCK-BASED COMPENSATION

We determine the fair value of stock options and restricted stock issued under our long term incentive plans as of the grant date. We recognized the related compensation expense over the period from the date of grant to the date when the award is no longer contingent on the employee providing additional service to the Company.

The Oil-Dri Corporation of America 2006 Long Term Incentive Plan (the “2006 Plan”) permits the grant of stock options, stock appreciation rights, restricted stock, restricted stock units, performance awards and other stock-based and cash-based awards. Our employees and outside directors are eligible to receive grants under the 2006 Plan. The total number of shares of stock subject to grants under the 2006 Plan may not exceed 937,500. Stock options have been granted to our outside directors with a vesting period of one year and stock options granted to employees generally vest 25%two years after the grant date and in each of the three following anniversaries of the grant date. In addition, restricted shares have been issued under the 2006 Plan as described in the restricted stock section below.

The Oil-Dri Corporation of America Outside Director Stock Plan provides for grants of stock options to directors. Stock options have been granted to our directors with a one year vesting period. There are no shares available for future grants under this plan. All shares of stock issued under this plan were from treasury stock.

Stock Options

A summary of stock option transactions as of January 31, 2014 is shown below:

	Number of Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value
	(in thousands)				(Years)	(in thousands)
Options outstanding, July 31, 2013	60		$	14.25	2.3	$	1,059
Exercised	(4	)	$	12.00		$	90
Forfeitures	(8	)	$	9.43
Options outstanding, January 31, 2014	48		$	15.27	2.3	$	911
Options exercisable, January 31, 2014	48		$	15.27	2.3	$	911

There were no stock options exercised during the second quarter of fiscal 2014. The amount of cash received from the exercise of stock options during the second quarter of fiscal 2013 was $591,000 and the related tax benefit was $255,000. The amount of cash received from the exercise of stock options during the first six months of fiscal 2014 was $51,000 and the related tax benefit was $24,000. The amount of cash received from the exercise of stock options during the first six months of fiscal 2013 was $652,000 and the related tax benefit was $268,000.

No stock options were granted in the first six months of either fiscal 2014 or 2013.

Restricted Stock

All of our non-vested restricted stock as of January 31, 2014 was issued under the 2006 Plan with vesting periods between two years and five years.

Under the 2006 Plan, no new restricted shares of common stock were granted in the second quarter of either fiscal 2014 or fiscal 2013. In the first quarter of fiscal 2014, 22,000 restricted shares of Common Stock and 10,000 restricted shares of Class B stock were granted. In the first quarter of fiscal 2013, 7,000 restricted shares of Class B stock were granted.

Included in our stock-based compensation expense in the second quarter of fiscal years 2014 and 2013 was $319,000 and $210,000, respectively, related to non-vested restricted stock. In the first six months of fiscal years 2014 and 2013, the expense related to unvested restricted stock was $560,000 and 413,000, respectively.

A summary of restricted stock transactions under the plan is shown below:

	Restricted Shares (in thousands)		Weighted Average Grant Date Fair Value
Non-vested restricted stock outstanding at July 31, 2013	117		$	22.24
Vested	(27	)	$	21.67
Granted	32		$	34.55
Forfeitures	(4	)	$	21.80
Non-vested restricted stock outstanding at January 31, 2014	118		$	25.72