Equity Compensation

3 Months Ended

May. 30, 2015

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

General

Total share-based compensation expense for the thirteen weeks ended May 30, 2015 and May 31, 2014 was $2.4 million and $2.1 million, respectively.

Stock Option Activity

Stock options have been granted to non-employee directors, officers, and other key employees. Generally, options outstanding under the 2002 and Amended 2009 Incentive Plans are exercisable at a price equal to the fair market value on the date of grant, vest over four years, and expire ten years after the date of grant. During the thirteen weeks ended May 30, 2015 and May 31, 2014, the Company granted approximately 761,550 and 601,000 options, respectively. The estimated weighted-average fair value of the individual options granted during the thirteen weeks ended May 30, 2015 and May 31, 2014, was $6.57 and $8.57, respectively, on the date of the grant. The fair values for all options were determined using a Black-Scholes option-pricing model with the following weighted average assumptions:



	Thirteen Weeks Ended
	May 30, 2015		May 31, 2014
Dividend yield	1.49	%	1.20	%
Volatility	33.4	%	37.1	%
Risk-free interest rate	1.41	%	1.73	%
Expected life	5.0 years		5.0 years

The dividend yield assumption is based on the Company’s history and expectation of dividend payouts. The expected volatility assumption is based on the Company’s analysis of historical volatility. The risk-free interest rate assumption is based on the average daily closing rates during the period for U.S. treasury notes that have a life which approximates the expected life of the option. The expected life of employee stock options represents the weighted-average period the stock options are expected to remain outstanding based on historical exercise experience.

As of May 30, 2015, there was $10.0 million of total unrecognized compensation cost, net of estimated forfeitures, related to nonvested options. That cost is expected to be recognized over a weighted average period of 2.0 years.

Restricted Stock Activity

The Company has granted shares of the Company’s common stock to non-employee directors, officers, and other key employees that are subject to restrictions. The restricted stock granted to employees under the 2002 and Amended 2009 Incentive Plans either vest upon the achievement of specified levels of profitability growth over a three-year period or were granted such that they cliff-vest after a three-year period. For performance-based awards, should the profitability criteria not be met over the three-year period, the shares will be forfeited. All restricted stock awards issued to non-employee directors cliff-vest after a one-year period from the grant date. During the thirteen weeks ended May 30, 2015 and May 31, 2014, the Company granted approximately 181,000 and 168,000 restricted shares, respectively.

As of May 30, 2015, there was $8.1 million of total unrecognized compensation cost, net of estimated forfeitures, related to nonvested restricted stock. That cost is expected to be recognized over a weighted average period of 2.1 years.