NOTE D--STOCK-BASED COMPENSATION

The Company has various stock compensation plans. During the quarter ended October 31, 2012, the Board of Directors of the Company approved grants of a total of 20,000 service-based restricted stock units to non-employee directors. These service-based restricted stock units vest daily through the end of the two-year vesting period as long as the recipient continuously remains a member of the Board, and entitle the recipient to receive one share of the Company’s common stock per unit granted. During the six months ended October 31, 2012, the Board of Directors of the Company also approved grants of non-statutory stock options and service-based and performance-based restricted stock units to key employees. The employee non-statutory stock option grants totaled 125,000 shares of the Company’s common stock with an exercise price of $17.62 per share. The options vest evenly over a three-year period and have a ten-year contractual term. The employee performance-based restricted stock units totaled 129,075 units and the employee service-based restricted stock units totaled 43,025 units. The performance-based restricted stock units entitle the recipients to receive one share of the Company’s common stock per unit granted if applicable performance conditions are met and the recipient remains continuously employed with the Company until the units vest. The service-based units entitle the recipients to receive one share of the Company’s common stock per unit granted if they remain continuously employed with the Company until the units vest. The Company’s restricted stock units granted to employees cliff-vest three years from the grant date.

For the three- and six-month periods ended October 31, 2012 and 2011, stock-based compensation expense was allocated as follows:


	Three Months Ended				Six Months Ended
	October 31,				October 31,
(in thousands)		2012		2011		2012		2011
Cost of sales and distribution	$	131	$	138	$	308	$	298
Selling and marketing expenses		189		187		430		389
General and administrative expenses		456		529		1,023		1,146
Stock-based compensation expense	$	776	$	854	$	1,761	$	1,833