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Note 11 - Stock-based Compensation

6 Months Ended

Jul. 31, 2020

Share-based Payment Arrangement [Text Block]

11.

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 6 “Stock-Based Compensation” in Notes to Consolidated Financial Statements included in the Annual Report on Form 10-K for the year ended January 31, 2020.

Stock-Based Compensation

The following table sets forth reported stock-based compensation expense for the three and six months ended July 31, 2020 and 2019:

	Three Months Ended July 31,				Six Months Ended July 31,
	2020		2019		2020		2019
	(in thousands)				(in thousands)
Cost of subscription	$	139	$	72	$	246	$	142
Cost of maintenance		120		132		229		253
Cost of professional services		412		359		749		681
Sales and marketing		720		575		1,228		955
Research and development		560		441		1,011		868
General and administrative		2,000		1,609		2,893		2,593
Total stock-based compensation expense	$	3,951	$	3,188	$	6,356	$	5,492

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, 2020:

	RSUs (in thousands)			Weighted Average Grant Date Fair Value
Restricted stock at January 31, 2020		627		$	39.86
Granted		342			40.27
Released (1)		(246	)		35.75
Forfeited		(10	)		40.64
Restricted stock at July 31, 2020		713		$	41.46

(1)

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, 2020, the Company withheld 74,000 shares for payment of these taxes at a value of $3.1 million. During the six months ended July 31, 2020, the Company withheld 76,000 shares for payment of these taxes at a value of $3.2 million.

Total unrecognized compensation cost related to RSUs was approximately $27.8 million as of July 31, 2020. This cost is expected to be recognized over a weighted-average period of approximately 3.0 years.

PSU Information

The following table summarizes the activity for PSUs for the six months ended July 31, 2020:

	PSUs (in thousands)			Weighted Average Grant Date Fair Value
Performance stock units at January 31, 2020		90		$	39.82
Granted		93			40.54
Released (1)		(21	)		39.82
Forfeited		(9	)		39.82
Performance stock units at July 31, 2020		153		$	40.26

(1)

The number of PSUs 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 and six months ended July 31, 2020, the Company withheld 8,000 shares for payment of these taxes at a value of $0.3 million.

Total unrecognized compensation cost related to PSUs was approximately $3.4 million as of July 31, 2020. This cost is expected to be recognized over a period of approximately 1.4 years.

SAR Information

The following table summarizes the activity for outstanding SARs for the six months ended July 31, 2020:

	SARs (in thousands)			Weighted Average Exercise Price per Share		Weighted Average Remaining Contractual Term (years)		Aggregate Intrinsic Value (in thousands)
Outstanding at January 31, 2020		1,349		$	24.86
Granted		-			-
Exercised		(201	)		12.92
Expired		-			-
Forfeited		-			-
Outstanding at July 31, 2020		1,148		$	26.96		3.3	$	15,697
Vested and exercisable at July 31, 2020		1,005		$	24.23		3.1	$	15,323

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, 2020, 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, 2020. The total intrinsic value of SARs exercised in the six months ended July 31, 2020 was $6.0 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, 2020, the Company withheld 56,000 shares for payment of these taxes at a value of $2.4 million. During the six months ended July 31, 2020, the Company withheld 57,000 shares for payment of these taxes at a value of $2.4 million.

At July 31, 2020, there was approximately $1.9 million of total unrecognized compensation cost related to unvested SARs. This cost is expected to be recognized over a weighted-average period of approximately 1.7 years.