SHARE-BASED PLANS

We have issued nonqualified stock options and restricted stock awards under our shareholder-approved equity compensation plans. Our restricted stock awards, as described below and in note 7 to the consolidated financial statements in our 2010 Form 10-K, are expensed and reported as nonvested shares. We recognized share-based compensation expense of $6.2 million and $5.8 million in the third quarter of 2011 and the third quarter of 2010, respectively, and $19.7 million and $19.7 million in the year-to-date 2011 and the year-to-date 2010, respectively.

The weighted-average fair value of stock options granted and assumptions used in the model to estimate the fair value of stock options granted during each of the respective periods were as follows:



	Third Quarter						Year-to-Date
	2011			2010			2011			2010
Weighted-average fair value of stock options granted	$	10.92		$	13.89		$	14.44		$	13.68
Risk-free interest rate	1.1		%	2.3		%	1.8		%	2.2		%
Expected life (years)	4.2			4.2			4.2			4.2
Expected volatility	40.9		%	43.7		%	41.7		%	45.7		%
Expected annual forfeiture rate	1.5		%	1.5		%	1.5		%	1.5		%

The following table summarizes stock option activity for the year-to-date 2011:



	Number of Options		Weighted Average Exercise Price Per Share		Weighted Average Remaining Contractual Term (years)	Aggregate Intrinsic Value (000's)
Outstanding stock options at January 29, 2011	3,578,683		$	24.59
Granted	878,000		41.19
Exercised	(162,525	)	21.34
Forfeited	(42,350	)	33.58
Outstanding stock options at April 30, 2011	4,251,808		$	28.05	4.9	$	55,582
Granted	19,250		32.95
Exercised	(139,750	)	18.39
Forfeited	(21,625	)	36.26
Outstanding stock options at July 30, 2011	4,109,683		$	28.36	4.7	$	33,083
Granted	15,000		$	31.47
Exercised	(31,425	)	$	16.29
Forfeited	(22,025	)	$	35.58
Outstanding stock options at October 29, 2011	4,071,233		$	28.43	4.5	$	40,548
Vested or expected to vest at October 29, 2011	4,004,820		$	28.46	4.5	$	39,823
Exercisable at October 29, 2011	1,832,732		$	23.15	3.3	$	26,574

The stock options granted in the year-to-date 2011 vest in equal amounts on the first four anniversaries of the grant date and have a contractual term of seven years. The number of stock options expected to vest was based on our annual forfeiture rate assumption.

The following table summarizes the nonvested restricted stock awards activity for the year-to-date 2011:



	Number of Shares		Weighted Average Grant-Date Fair Value Per Share
Outstanding nonvested restricted stock at January 29, 2011	503,784		$	35.88
Granted	532,900		41.21
Vested	(250,000	)	35.92
Forfeited	(3,900	)	37.50
Outstanding nonvested restricted stock at April 30, 2011	782,784		$	39.48
Granted	29,139		33.28
Vested	(21,784	)	34.88
Forfeited	(2,400	)	38.52
Outstanding nonvested restricted stock at July 30, 2011	787,739		$	39.38
Granted	1,800		31.47
Vested	—		—
Forfeited	(2,400	)	38.52
Outstanding nonvested restricted stock at October 29, 2011	787,139		$	39.37

The nonvested restricted stock awards granted in the year-to-date 2011 (other than the award granted to our Chairman, CEO and President, Steven S. Fishman) vest if certain financial performance objectives are achieved. If we meet a threshold financial performance objective and the recipient remains employed by us, the restricted stock will vest on the opening of our first trading window five years after the grant date of the award. If we meet a higher financial performance objective and the recipient remains employed by us, the restricted stock will vest on the first trading day after we file our Annual Report on Form 10-K with the SEC for the fiscal year in which the higher objective is met. The restricted stock will also vest on a prorated basis in the event that the recipient dies or becomes disabled after we meet the threshold financial performance objective but before the lapse of five years. On the grant date, we estimated a three-year period for vesting of the nonvested restricted stock awards granted in 2011 based on the projected achievement of the higher financial performance objective. The nonvested restricted stock award granted to Mr. Fishman in 2011 vests if we achieve a corporate financial goal for 2011 and he is employed by us on the anniversary of the grant date of the award. If either of the conditions is not achieved, the nonvested restricted stock award is forfeited. If both of the conditions are achieved, Mr. Fishman's 2011 nonvested restricted stock will vest on the first trading day after we file our Annual Report on Form 10-K for 2011 with the SEC.

On the grant date of the 2010 awards, we estimated a two-year period for vesting based on the assumed achievement of the higher financial performance objective. In the second quarter of 2011, we changed the estimated achievement date for the higher financial performance objective from two years to three years.

In the second quarter of 2011, 21,784 common shares underlying the restricted stock awards granted to the non-employee members of our Board of Directors in 2010 vested on the trading day immediately preceding our 2011 Annual Meeting of Shareholders. These awards were part of the annual compensation granted in 2010 to the non-employee members of the Board of Directors. Additionally, in the second quarter of 2011, each non-employee member of our Board of Directors received an annual restricted stock award having a grant date fair value of approximately $95,000. These restricted stock awards will vest on the earlier of (1) the trading day immediately preceding our 2012 Annual Meeting of Shareholders, or (2) the non-employee director’s death or disability. However, the restricted stock award will not vest if the non-employee director ceases to serve on our Board of Directors before either vesting event occurs.

The following activity occurred under our share-based plans during the respective periods shown:



	Third Quarter				Year-to-Date
(in thousands)	2011		2010		2011		2010
Total intrinsic value of stock options exercised	$	574	$	1,915	$	6,119	$	32,321
Total fair value of restricted stock vested	—		28		11,618		31,071

The total unearned compensation cost related to all share-based awards outstanding at October 29, 2011 was approximately $35.9 million. This compensation cost is expected to be recognized through September 2015 based on existing vesting terms with the weighted-average remaining expense recognition period being approximately 1.8 years from October 29, 2011.