12.

STOCK-BASED COMPENSATION

The Company’s equity awards consist of RSUs, PSUs and SARs. For a description of the Company’s stock-based compensation plans, see Note

“Stock-Based Compensation” in Notes to Consolidated Financial Statements included in the Annual Report on Form

-K for the year ended

January 31, 2019.

Performance Stock Units (“PSUs”)

June 2019,

the Company began issuing performance-based stock units (“PSUs”) to select employees. PSUs granted to employees under the

2016

Program are generally released

1/3

after each year of service for

three

years and are contingent upon employment with the Company and achievement of pre-determined performance objectives. To determine the anticipated achievement of the performance objectives, management must make assumptions regarding the likelihood of the Company meeting those targets. The number of PSUs that vest will be predicated on the Company achieving performance objectives during the measurement period subsequent to the date of grant. Depending on the financial performance levels achieved, a percentage of the PSUs (

200%

of the target award) will vest to the grantees of those stock units. There is

guarantee that such PSUs will vest in whole or in part.

Stock-Based Compensation

The following table sets forth reported stock-based compensation expense for the

three

and

six

months ended

July 31, 2019

and

2018:

	Three Months Ended July 31,				Six Months Ended July 31,
	201 9		201 8		201 9		201 8
	(in thousands)				(in thousands)
Cost of subscription	$	72	$	68	$	142	$	117
Cost of maintenance and other revenue		132		118		253		210
Cost of professional services		359		327		681		553
Sales and marketing		575		534		955		936
Research and development		441		413		868		728
General and administrative		1,609		1,904		2,593		2,926
Total stock-based compensation expense	$	3,188	$	3,364	$	5,492	$	5,470

RSU Information

The estimated fair value of RSUs was calculated based on the closing price of the Company’s common stock on the date of grant, reduced by the present value of dividends foregone during the vesting period.

The following table summarizes the activity for RSUs for the

six

months ended

July 31, 2019:

	RSUs			Weighted Average Grant Date Fair Value
	(in thousands)
Outstanding at January 31, 2019		663		$	36.64
Granted		261			39.74
Released (1)		(254	)		32.33
Forfeited		(26	)		37.56
Outstanding at July 31, 2019		644		$	39.55

(

)

The number of RSUs released includes shares withheld on behalf of employees to satisfy the minimum statutory tax withholding requirements.

The Company withholds a portion of the released shares as consideration for the Company’s payment of applicable employee income taxes. During the

three

months ended

July 31, 2019,

the Company withheld

76,000

shares for payment of these taxes at a value of

$3.2

million. During the

six

months ended

July 31, 2019,

the Company withheld

80,000

shares for payment of these taxes at a value of

$3.3

million.

Total unrecognized compensation cost related to RSUs was approximately

$24.1

million as of

July 31, 2019.

This cost is expected to be recognized over a weighted-average period of approximately

3.1

years.

PSU Information

The estimated fair value of PSUs was calculated based on the closing price of the Company’s common stock on the date of grant, reduced by the present value of dividends foregone during the vesting period.

The following table summarizes the activity for PSUs for the

six

months ended

July 31, 2019:

	PSUs		Weighted Average Grant Date Fair Value
	(in thousands)
Outstanding at January 31, 2019		—	$	—
Granted		93		39.82
Released		—		—
Forfeited		—		—
Outstanding at July 31, 2019		93	$	39.82

Total unrecognized compensation cost related to PSUs was approximately

$3.5

million as of

July 31, 2019.

This cost is expected to be recognized over a weighted-average period of approximately

1.9

years.

SAR Information

The following table summarizes the activity for outstanding SARs for the

six

months ended

July 31, 2019:

	SARs (in thousands)			Weighted Average Exercise Price per Share		Weighted Average Remaining Contractual Term (years)		Aggregate Intrinsic Value (in thousands)
Outstanding at January 31, 2019		2,533		$	20.81
Granted		—			—
Exercised		(17	)		11.44
Expired		—			—
Forfeited		—			—
Outstanding at July 31, 2019		2,516		$	20.87		3.0	$	55,181
Vested and exercisable at July 31, 2019		2,231	(1)	$	18.38		2.6	$	53,002

(

) The number of SARs vested and exercisable at

July 31, 2019

includes

877,500

Class A and

127,500

Class B shares previously held by Mr. Karl Lopker which were exercised on

August 22, 2019

by his estate, prior to their expiration date of

August 25, 2019.

Exercise prices for these SARs range from

$10.50

$31.65.

The aggregate intrinsic value in the table above represents the total pretax intrinsic value (the aggregate difference between the closing stock price of the Company’s common stock based on the last trading day as of

July 31, 2019,

and the exercise price for in-the-money SARs) that would have been received by the holders if all SARs had been exercised on

July 31, 2019.

The total intrinsic value of SARs exercised in the

six

months ended

July 31, 2019

was

$0.5

million.

The number of SARs exercised includes shares withheld on behalf of employees to satisfy minimum statutory tax withholding requirements. During the

three

months ended

July 31, 2019,

the Company withheld

2,000

shares for payment of these taxes at a value of

$98,000.

During the

six

months ended

July 31, 2019,

the Company withheld

4,000

shares for payment of these taxes at a value of

$0.2

million.

July 31, 2019,

there was approximately

$3.4

million of total unrecognized compensation cost related to unvested SARs. This cost is expected to be recognized over a weighted-average period of approximately

2.5

years.