Note

- Stock-based compensation

January 31, 2019

, the Company had

one

incentive stock plan under which new equity incentive awards

may

be granted:

•

2017

Omnibus Stock Incentive Plan as Amended

June 13, 2017,

as amended, which stockholders approved in

June 2017 (

"2017

Plan")

The Company has prior incentive plans under which previously granted awards remain outstanding, but under which

new awards

may

be granted. At

January 31, 2019,

the Company had reserved a total of

834,182

shares for grants and issuances under these incentive stock plans, which includes a reserve for issuances pursuant to unvested or unexercised prior awards, and shares for new grants or issuances pursuant to the

2017

Plan.

While the

2017

Plan provides for the grant of deferred shares, non-qualified stock options, incentive stock options, restricted shares, restricted stock units, and performance-based restricted stock units intended to qualify under section

422

of the Internal Revenue Code, to date the Company has issued only restricted shares and restricted stock units under the

2017

Plan and currently intends to continue this practice. The

2017

Plan authorizes awards to officers, employees, consultants, and directors.

Stock compensation expense

The Company recognized the following stock based compensation expense:

(In thousands)	2018		2017
Stock-based compensation expense	$	33	$	94
Restricted stock based compensation expense		1,132		1,353
Total stock-based compensation expense	$	1,165	$	1,447

Stock options

Options vest ratably over

years and are exercisable for up to

ten

years from the date of grant. To cover the exercise of vested options, the Company issues new shares from its authorized but unissued share pool. The Company calculates all stock compensation expense based on the grant date fair value of the option and recognizes expense on a straight-line basis over the

four

-year vesting period of the option.

The following summarizes the activity related to options outstanding under all plans for the years ended

January

31,

2018

and

2019.

The Company did

not

grant any stock options in

2017

2018.

(Shares in thousands)	Options			Weighted average exercise price		Weighted average remaining contractual term		Aggregate intrinsic value
Outstanding on January 31, 2017		524		$	11.55		4.5	$	534

Exercised		(35	)		6.80				45
Expired or forfeited		(131	)		18.54
Outstanding on January 31, 2018		358			9.44		4.0		482

Options exercisable on January 31, 2018		327		$	9.56		3.7		433

Exercised		(77	)		6.83				162
Expired or forfeited		(63	)		16.2
Outstanding on January 31, 2019		218			8.6		3.8		257

Options exercisable on January 31, 2019		207		$	8.69		3.6	$	239

Unvested options outstanding (shares in thousands)	Options			Weighted- average grant date fair value		Aggregate intrinsic value
Outstanding on January 31, 2018		31		$	8.24	$	50
Granted		—			—
Vested		(14	)
Expired or forfeited		(6	)		8.12
Outstanding on January 31, 2019		11		$	7.00	$	19

Based on historical experience the Company expects

94%

of these options to vest.

As of

January

31,

2019,

there was less than

$0.1

million of unrecognized compensation cost related to unvested stock options granted under the plans. That cost is expected to be recognized over the weighted-average period of

1.2

years.

Deferred stock

As part of their compensation, each year the Company will grant deferred stock units to each non-employee director, equal to the result of dividing the award amount by the fair market value of the common stock on the date of grant. The stock vests on the date of grant, however it is only distributed to the directors upon their separation from service. In

June 2018

the Company granted

21,450

deferred stock units from the

2017

Plan, and as of

January 31, 2019

, there were approximately

101,945

deferred stock units outstanding included in the restricted stock activity shown below.

As a result of certain events that occurred during

second

quarter of fiscal

2018,

including a settlement of a stock-based award previously granted to a retiring member of the Company's Board of Directors, the Company changed its method of accounting for deferred stock compensation arrangements granted to the Company's directors from liability accounting treatment to equity accounting treatment and, as such, reclassified

$0.7

million from a liability to additional paid in capital.

(In thousands)		2018				2017
Deferred compensation liabilities		$	-			$	815

Restricted stock

The Company has granted restricted stock to executive officers and employees. The restricted stock vest ratably over

three

four

years. The Company calculates restricted stock compensation expense based on the grant date fair value and recognizes expense on a straight-line basis over the vesting period. The following table summarizes restricted stock activity for the years ended

January

31,

2018

and

2019,

respectively:

(Shares in thousands)	Restricted shares			Weighted average price		Aggregate intrinsic value
Outstanding on January 31, 2017		290		$	8.75	$	2,533
Granted		178			8.06
Issued		(101	)
Forfeited		(7	)		7.15
Outstanding on January 31, 2018		360		$	9.05	$	3,254

Granted		148			9.76
Issued		(94	)
Forfeited		(131	)		7.92
Outstanding on January 31, 2019		283		$	8.74	$	2,476

As of

January 31, 2019

, there was

$1.2

million of unrecognized compensation cost related to unvested restricted stock granted under the plans. That cost is expected to be recognized over the weighted-average period of

2.2

years.