Share-Based Compensation Plans

6 Months Ended

Aug. 31, 2016

Note 15 – Share-Based Compensation Plans

We have share-based awards outstanding under several share-based compensation plans. During the periods reported, the Company had the following share-based compensation activity:

During the three months ended May 31, 2016, we granted options to purchase 1,500 shares of common stock to employees. The fair value of these options were estimated using the Black-Scholes option pricing model to estimate fair value of $28.74 for a grant with a term of four years. The following assumptions were used for the grant: expected life of 4.05 years; risk-free interest rate of 1.22 percent; zero dividend yield; and an expected volatility of 33.40 percent.

During the three- and six-months ended August 31, 2016, we issued 1,190 and 2,471 restricted shares, respectively, to non-employee Board members with a total grant date fair value of $0.12 and $0.25 million, respectively, and average share prices of $103.46 and $99.55, respectively.

During the three- and six-months ended August 31, 2016, we granted RSUs that may be settled for 4,650 and 83,582 shares of common stock, with average fair values at the grant dates of $94.58 and $97.63 per unit, respectively.

During the three months ended May 31, 2016, we granted PSUs that may be settled for up to 139,456 shares of common stock, with an average fair value of $97.12 per unit.

During the three months ended May 31, 2016, employee RSUs for 13,231 shares vested and settled with a total grant date fair value of $1.27 million and a share price of $95.92.

During the three- and six-months ended August 31, 2016, employees exercised stock options to purchase 38,032 and 111,667 shares of common stock, respectively.

During the three- and six-months ended August 31, 2016, employees purchased 14,580 shares of common stock for $1.12 million through our employee stock purchase plan.

We recorded the following share-based compensation expense in SG&A for the periods covered below:

SHARE-BASED PAYMENT EXPENSE

(in thousands, except per share data)


	Three Months Ended August 31,				Six Months Ended August 31,
	2016		2015		2016		2015
Stock options	$	667	$	644	$	1,407	$	1,337
Directors stock compensation		175		175		350		350
Performance based and other stock awards		2,096		887		6,847		2,132
Employee stock purchase plan		258		223		258		223
Share-based payment expense		3,196		1,929		8,862		4,042
Less income tax benefits		(693)		(274)		(2,214)		(593)
Share-based payment expense, net of income tax benefits	$	2,503	$	1,655	$	6,648	$	3,449

Earnings per share impact of share based payment expense:
Basic	$	0.09	$	0.06	$	0.24	$	0.12
Diluted	$	0.09	$	0.06	$	0.24	$	0.12