Stock Options

3 Months Ended

May 28, 2011

Stock Options

Stock Options

8. Stock Options

        On March 21, 2011, the Company launched a Stock Option Exchange Program ("Program") for eligible associates only. Under the Program, eligible associates had the opportunity to surrender certain stock options for a lesser number of new stock options with an exercise price that was determined based on the closing market price on April 21, 2011, the day the Program concluded. The number of new options was determined by applying exchange ratios that resulted in providing new stock options with an aggregate fair value that approximated the aggregate fair value of the options they replaced. The new options vest over two years and have a five year life with an exercise price of $1.03. A total of 14.0 million options with an average exercise price in excess of $1.77 were cancelled and 5.3 million new options were granted with an exercise price of $1.03. The Company recognized a minimal incremental compensation expense as a result of the Program.

        Following is a summary of stock option transactions for the quarter ended May 28, 2011:

		Shares
Outstanding at February 26, 2011			74,298
	Granted		5,312
	Exercised		(65	)
	Cancelled		(15,765	)
Outstanding at May 28, 2011			63,780