STOCK-BASED COMPENSATION

6 Months Ended

Jul. 31, 2011

Notes to Financial Statements [Abstract]

NOTE 4 - STOCK-BASED COMPENSATION

The Company grants equity awards to its senior executives and non-employee Directors, typically in December of each year. Historically, this has consisted of stock option awards. In December 2010, the Company's Board of Directors approved a change in practice to begin awarding non-employee Directors restricted stock units ("RSUs").

Restricted Stock Units:

On December 17, 2010, the Company awarded an aggregate of 12,315 RSUs to its five non-employee Directors. Each RSU entitles the grantee to receive, from the Company, one common share at the one year anniversary vesting date in accordance with the terms of the award agreement. The award agreements provide for accelerated vesting in certain instances such as a "change in control" or death, and for pro-rata vesting in the event of a non-cause departure from the Board of Directors prior to the one year anniversary of the award. The weighted average grant

fair value per unit for awards granted on December 17, 2010 was $12.18 (which is the average of the high and low price of the Company's common shares as quoted on the NYSE that day). As of January 31, 2011, there was $149,997 of unrecognized compensation expense for these RSUs, which will be recognized in the fiscal year ending January 31, 2012. Prior to December 17, 2010, the Company had never granted any RSUs.

The following table summarizes RSU transactions for the six-month period ended July 31, 2011:

	Units
Non-vested at February 1, 2011	12,315
Granted	-
Vested	-
Forfeited	-
Non-vested at July 31, 2011	12,315

Stock options:

On December 17, 2010, December 11, 2009, and December 3, 2008, the Company issued 125,448, 236,083 and 206,600 stock options, respectively, with one-third exercisable one year from the grant date and the remaining two-thirds vesting two and three years from grant date, respectively. The December 2010 awards were made to the Company's senior executives; the awards in the prior two years were made to the Company's senior executives as well as the Company's non-employee Directors. In the event of a "change of control", any unvested options shall become immediately exercisable. Typically, the duration of options is for up to ten years from the date of grant, subject to earlier termination under various conditions. The fair value of options that we grant is amortized into compensation expense on a straight-line basis over their respective vesting period, net of estimated forfeitures. We estimate the fair value of options as of the grant date using the Black-Scholes option valuation model. The per share fair value weighted-averages at the date of grant for stock options granted in the month of December during the fiscal years ended January 31, 2011, 2010 and 2009 were $3.95, $3.26 and $3.41 per option, respectively.

The application of this valuation model relies on the following assumptions that are judgmental and sensitive in the determination of the compensation expense:

	Six Months Ended
	July 31,
	2011	2010
Expected term (years)	5.0	5.0
Risk-free interest rate	1.68% - 2.11%	1.90% - 3.53%
Expected volatility	39% - 45%	29% - 45%
Dividend yield	2.12% - 2.48%	1.88% - 2.48%

Historical information was the principal basis for the selection of the expected term and dividend yield. The expected volatility is based on a weighted-average combination of historical and implied volatilities over a time period that approximates the expected term of the option. The risk-free interest rate was selected based upon the U.S. Treasury Bill rates in effect at the time of grant for the expected term of the option.

The following table summarizes stock option transactions for the six-month period ended July 31, 2011:

					Weighted
				Weighted	Average
				Average	Remaining	Aggregate
		Shares		Exercise Price	Life (years)	Intrinsic Value
Options:
	Outstanding at February 1, 2011	1,274,204		$10.1942	6.29
	Granted	-		-
	Forfeited	-		-
	Expired	(26,000	)	11.7500
	Exercised	(5,000	)	8.5600
	Outstanding at July 31, 2011	1,243,204		$10.1683	5.94	$1,059,613

	Exercisable at July 31, 2011	921,358		$9.9011	5.01	$937,938

There were 5,000 options exercised during the six-month period ended July 31, 2011 and 30,226 options exercised during the six-month period ended July 31, 2010.

The following table summarizes information about the options outstanding and options exercisable as of July 31, 2011:

	Options Outstanding			Options Exercisable
		Weighted Average
		Remaining	Weighted Average		Weighted Average
	Shares	Life (years)	Exercise Price	Shares	Exercise Price
Range of prices:
$5.50 - 6.99	39,825	1.07	$5.5328	39,825	$5.5328
$7.00 - 8.99	116,450	3.57	7.4110	116,450	7.4110
$9.00 - 9.99	470,344	5.77	9.4848	326,949	9.3948
$10.00 - 10.99	155,337	5.26	10.8975	155,337	10.8975
$11.00 - 11.99	335,800	6.61	11.5426	282,797	11.5796
$12.00 - 12.99	125,448	9.39	12.1800	0	0
	1,243,204	5.94	$10.1683	921,358	$9.9011

As of July 31, 2011, there was $793,628 (excludes an unrecognized compensation cost of $149,997 related to RSUs) of total unrecognized compensation cost related to non-vested share-based compensation arrangements granted under the plans. The cost is expected to be recognized over a weighted-average period of 1.9 years.