Share Based Compensation

9 Months Ended

Oct. 31, 2012

Share-based Compensation [Abstract]

Share Based Compensation

SHARE-BASED COMPENSATION

Under the Amended and Restated 2010 Stock Incentive Plan effective March 23, 2012, administered by the Personnel and Compensation Committee of the Board of Directors, two types of awards were granted during the nine months ended October 31, 2012.

Stock Option Awards

On April 2, 2012, the Company granted 151 non-qualified stock options. On August 27, 2012, the Company granted an additional 8 non-qualified stock options. Options are granted with exercise prices not less than market value of the Company's common stock at the date of grant. The stock options vest over a four-year period and expire after five years. Options contain retirement and change-in-control provisions that may accelerate the vesting period. The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model. The Company uses historical data to estimate option exercise and employee termination within this valuation model.

The fair value of options granted during the nine months ended October 31, 2012 was estimated using the following assumptions:

	Grant Date
	April 2, 2012		August 27, 2012
Risk-free interest rate	0.86	%	0.86	%
Expected dividend yield	1.33	%	1.41	%
Expected volatility factor	49.65	%	49.11	%
Expected option term (in years)	3.75		3.75

The weighted average grant date fair value of options granted during the nine months ended October 31, 2012 was $10.92.

The Company did not grant any options during the three and nine months ended October 31, 2011.

Restricted Stock Unit Awards

The Company granted 21 time-vested and 51 performance-based restricted stock units to employees during the three months ended April 30, 2012. Time-vested restricted stock units will vest, if at the end of the three-year period, the employee remains employed by the Company. The performance-based restricted stock units will vest if, at the end of the three-year performance period, the Company has achieved certain performance goals and the employee remains employed by the Company. The exact number of performance shares to be issued will vary from 0% to 150% of the target award, depending on the Company's actual performance over the three-year period in comparison to the target award goal based on return on sales (ROS), which is defined as net income divided by net sales. Dividends are cumulatively earned on both types of restricted stock units over the vesting period.

The fair value of a time-vested restricted stock unit is measured based upon the closing market price of the Company's common stock on the date of grant. The grant date fair value of the time-vested restricted stock units was $31.66.

The fair value of the performance-based restricted stock units is based upon the closing market price of the Company's common stock on the grant date multiplied by the number of restricted stock units granted, which is determined by an estimated ROS target over the three-year performance period. The estimated ROS performance used to estimate the number of restricted stock units expected to vest is evaluated at least quarterly. The number of restricted stock units issued at the vesting date will be based on actual results. The fair value of the performance-based restricted stock units on the grant date was $31.66.

No time-vested or performance-based restricted stock units were granted during the three months ended October 31, 2012 or the three and nine months ended October 31, 2011.