Barnes and Noble 2012 Annual Report Download - page 43

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Company’s stock option plans and represents the period
of time that stock option awards granted are expected to be
outstanding. The expected term assumption incorporates
the contractual term of an option grant, which is ten years,
as well as the vesting period of an award, which is gener-
ally pro-rata vesting annually over four years. The risk-
free interest rate is based on the implied yield on a U.S.
Treasury constant maturity with a remaining term equal to
the expected term of the option granted.
The Company recognizes stock-based compensation costs,
net of estimated forfeitures, for only those shares expected
to vest on a straight-line basis over the requisite service
period of the award. The Company estimates the forfeiture
rates based on its historical experience.
The weighted average assumptions relating to the valua-
tion of the Company’s stock options for fi scal years 
and  are shown below. No stock options were granted
during fi scal .
Fiscal Year 2012 2010
Weighted average fair value
of grants $9.85 $5.72
Volatility 78.52% 41.30%
Risk-free interest rate 0.92% 2.59%
Expected life 5 years 5 years
Expected dividend yield 0.00% 4.53%
Stock-Based Compensation Activity
The following table presents a summary of the Company’s
stock option activity:
NUMBER OF
SHARES
(in thousands)
WEIGHTED
AVERAGE
EXERCISE
PRICE
WEIGHTED
AVERAGE
REMAINING
CONTRACTUAL
TERM
AGGREGATE
INTRINSIC
VALUE
(in thousands)
Balance,
May 2, 2009 5,561 $ 20.14 3.83 years $33,633
Granted 500 22.07
Exercised (313) 13.96
Forfeited (250) 30.69
Balance,
May 1, 2010 5,498 20.19 3.49 years $ 13,782
Exercised (1,024) 16.83
Forfeited (598) 20.57
Balance,
April 30, 2011 3,876 21.02 3.40 years —
Granted 1,563 15.70
Exercised (92) 11.89
Forfeited (1,487) 21.86
Balance,
April 28, 2012 3,860 $ 18.76 5.70 years $ 574
Vested and
expected to vest
in the future at
April 28, 2012 3,860 $ 18.76 5.70 years $ 574
Exercisable at
April 28, 2012 2,132 $ 20.74 2.68 years $ 515
Available for
grant at
April 28, 2012 1,001
The aggregate intrinsic value in the table above represents
the total pre-tax intrinsic value (the diff erence between
the Company’s closing stock price on the last trading day of
the related fi scal year and the exercise price, multiplied by
the related in-the-money options) that would have been
received by the option holders had they exercised their
options at the end of the fi scal year. This amount changes
based on the market value of the Company’s common
stock. Total intrinsic value of options exercised for fi scal
, fi scal  and fi scal  (based on the diff erence
between the Company’s stock price on the exercise date and
the respective exercise price, multiplied by the number of
options exercised) was ,  and ,, respectively.
2012 Annual Report 41