STOCK-BASED COMPENSATION

3 Months Ended

Apr. 30, 2012

STOCK-BASED COMPENSATION [Abstract]

STOCK-BASED COMPENSATION

NOTE 4 - STOCK-BASED COMPENSATION

Stock options:

On April 2, 2012 and February 27, 2012, the Company issued 54,628 and 97,299, 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 April 2012 and February 2012 awards were made to the Company's senior executives.  In the event of a "change of control", certain unvested options may 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 April 2012 and February 2012, were $3.18 and $2.96,  respectively.

The following table summarizes stock option transactions for the three-month period ended April 30, 2012:

					Weighted
				Weighted	Average
				Average	Remaining	Aggregate
		Shares		Exercise Price	Life (years)	Intrinsic Value
Options:
	Outstanding at February 1, 2012	1,223,292		$10.2437	5.52
	Granted	151,924		10.0514
	Forfeited	(2,201	)	12.1800
	Expired	(9,956	)	5.5476
	Exercised	-		-
	Outstanding at April 30, 2012	1,363,059		$10.2534	5.58	$575,367
	Exercisable at April 30, 2012	1,075,225		$10.1895	4.65	$546,962

The aggregate intrinsic value of options exercised during the three-month period ended April 30, 2011 was $14,775.  The intrinsic value of stock options is the amount by which the market price of the stock on a given date, such as at the end of the period or on the day of exercise, exceeded the market price of stock on the date of grant.

In connection with the Separation Agreement between the Company and its former Chief Financial Officer, the Company agreed to accelerate the vesting date and extend the exercise date of certain stock options.  This was considered a stock option modification resulting in additional stock compensation expense of approximately $250,000, which was recorded in the three-month period ended April 30, 2012.