Stock-based compensation

6 Months Ended

Apr. 30, 2011

10.		Stock-based compensation. The amended and restated 2004 long-term performance plan, approved by our shareholders in 2008, provides for the granting of stock options, stock appreciation rights, nonvested (restricted) stock, stock purchase rights, stock equivalent units, cash awards and other stock or performance-based incentives. The number of common shares available for grant of awards is 2.5% of the number of common shares outstanding as of the first day of each fiscal year.

		Stock Options

		Nonqualified or incentive stock options may be granted to our employees and directors. Generally, options granted to employees may be exercised beginning one year from the date of grant at a rate not exceeding 25% per year for executive officers and 20% per year for other employees and expire 10 years from the date of grant. Vesting accelerates upon the occurrence of events that involve or may result in a change of control. Option exercises are satisfied through the issuance of treasury shares on a first-in first-out basis.

		We recognized compensation expense related to stock options of $712 in the three months ended April 30, 2011 and $579 in the three months ended April 30, 2010. Amounts for the six months ended April 30, 2011 and April 30, 2010 were $1,431 and $1,114, respectively.

		The following table summarizes activity related to stock options for the six months ended April 30, 2011:


								Weighted
				Weighted-Average		Aggregate		Average
	Number of			Exercise Price Per		Intrinsic		Remaining
	Options			Share		Value		Term

Outstanding at October 31, 2010		2,362		$	20.15
Granted		287		$	43.32
Exercised		(762	)	$	19.04
Forfeited or expired		(3	)	$	22.50

Outstanding at April 30, 2011		1,884		$	24.12	$	61,889	6.6 years


Vested or expected to vest at April 30, 2011		1,805		$	23.83	$	59,809	6.5 years

Exercisable at April 30, 2011		969		$	19.67	$	36,139	5.0 years

		At April 30, 2011, there was $8,250 of total unrecognized compensation cost related to nonvested stock options. That cost is expected to be amortized over a weighted average period of approximately 2.2 years.

		The fair value of each option grant was estimated at the date of grant using the Black-Scholes option-pricing model with the following assumptions:


Six months ended	April 30, 2011			April 30, 2010


Expected volatility		.431-.451			.429-.442
Expected dividend yield		1.28	%		1.35-1.40	%
Risk-free interest rate		1.89%-2.25	%		2.27-3.18	%
Expected life of the option (in years)		5.4-6.3			5.4-6.3

The weighted-average expected volatility used to value the 2011 options was .443. The weighted-average expected volatility used to value the 2010 options was .436. The weighted-average dividend yield used to value the 2010 options was 1.39%.

		Historical information was the primary basis for the selection of the expected volatility, expected dividend yield and the expected lives of the options. The risk-free interest rate was selected based upon yields of U.S. Treasury issues with a term equal to the expected life of the option being valued.

		The weighted average grant date fair value of stock options granted during the six months ended April 30, 2011 and 2010 was $16.80 and $11.08, respectively.

		The total intrinsic value of options exercised during the three months ended April 30, 2011 and April 30, 2010 was $9,107 and $11,901, respectively. The total intrinsic value of options exercised during the six months ended April 30, 2011 and April 30, 2010 was $22,157 and $18,669, respectively.

		Cash received from the exercise of stock options was $9,282 for the six months ended April 30, 2011 and $10,588 for the six months ended April 30, 2010. The tax benefit realized from tax deductions from exercises was $6,919 for the six months ended April 30, 2011 and $6,071 for the six months ended April 30, 2010.

		Nonvested Common Shares

		We may grant nonvested common shares to our employees and directors. These shares may not be disposed of for a designated period of time (generally six months to five years) defined at the date of grant. For employee recipients, shares are forfeited on a pro-rata basis in the event employment is terminated as a consequence of the employee recipient’s retirement, disability or death. Termination for any other reason results in forfeiture of the shares. For non-employee directors, restrictions lapse upon the retirement, disability or death of the non-employee director. Termination of service as a director for any other reason results in a pro-rata forfeiture of shares.

		As shares are issued, deferred share-based compensation equivalent to the fair market value on the date of grant is charged to shareholders’ equity and subsequently amortized over the restriction period. Tax benefits arising from the lapse of restrictions on the shares are recognized when realized and credited to capital in excess of stated value.

		The following table summarizes activity related to nonvested shares during the six months ended April 30, 2011:


				Weighted-Average
	Number of			Grant Date Fair
	Shares			Value

Nonvested shares at October 31, 2010		80		$	24.70
Granted		37		$	43.32
Vested		(21	)	$	15.89
Forfeited		(1	)	$	43.32

Nonvested shares at April 30, 2011		95		$	33.85

		As of April 30, 2011, there was $2,230 of unrecognized compensation cost related to nonvested common shares. The cost is expected to be amortized over a weighted average period of 2.1 years.

		The amount charged to expense related to nonvested stock was $336 in the three months ended April 30, 2011 and $158 in the three months ended April 30, 2010. For the six months ended April 30, 2011 and April 30, 2010, the amounts were $616 and $337, respectively.

		Directors Deferred Compensation

		Non-employee directors may defer all or part of their compensation until retirement. Compensation may be deferred as cash or as share equivalent units. Deferred cash amounts are recorded as liabilities. Additional share equivalent units are earned when common share dividends are declared.

		The following table summarizes activity related to director deferred compensation share equivalent units during the six months ended April 30, 2011:


				Weighted-Average
	Number of			Grant Date Fair
	Shares			Value

Outstanding at October 31, 2010		267		$	16.54
Deferrals		2		$	48.94
Restricted stock units vested		18		$	16.55
Dividend equivalents		1		$	49.93
Distributions		(20	)	$	14.80

Outstanding at April 30, 2011		268		$	17.06

		The amount charged to expense related to this plan was $59 for the three months ended April 30, 2011 and $71 for the three months ended April 30, 2010. For the six months ended April 30, 2011 and April 30, 2010, the amounts were $156 and $171, respectively.

		Long-Term Incentive Compensation Plan

		Under the long-term incentive compensation plan, executive officers and selected other key employees receive common share awards based solely on corporate performance measures over three-year performance periods. Awards vary based on the degree to which corporate performance exceeds predetermined threshold, target and maximum performance levels at the end of a performance period. No payout will occur unless certain threshold performance objectives are exceeded.

		The amount of compensation expense is based upon current performance projections for each three-year period and the percentage of the requisite service that has been rendered. The calculations are also based upon the grant date fair value determined using the market price of common stock at the grant date, adjusted for dividends. This 2011 per-share value was $42.02 for both the executive officers and selected other key employees. The 2010 per-share values were $26.10 and $29.52 for the executive officers and $26.10 for the selected other key employees. The 2009 per-share value was $13.23. The amount charged to expense for the three months ended April 30, 2011 and 2010 was $874 and $374, respectively. For the six months ended April 30, 2011 and 2010, the amounts were $2,319 and $840, respectively. The cumulative amount recorded in shareholders’ equity at April 30, 2011 was $4,333.