As of March 31, 2017, the Company maintains the Second Amended and Restated EnerSys 2010 Equity Incentive Plan (“2010 EIP”). The 2010 EIP reserved 3,177,477 shares of common stock for the grant of various classes of nonqualified stock options, restricted stock units, market share units and other forms of equity-based compensation. Shares subject to any awards that expire without being exercised or that are forfeited or settled in cash shall again be available for future grants of awards under the 2010 EIP. Shares subject to awards that have been retained by the Company in payment or satisfaction of the exercise price and any applicable tax withholding obligation of an award shall not count against the limit described above.

As of March 31, 2017, 823,554 shares are available for future grants. The Company’s management equity incentive plans are intended to provide an incentive to employees and non-employee directors of the Company to remain in the service of the Company and to increase their interest in the success of the Company in order to promote the long-term interests of the Company. The plans seek to promote the highest level of performance by providing an economic interest in the long-term performance of the Company. The Company settles employee share-based compensation awards with newly issued shares.

During fiscal 2017, the Company granted to management and other key employees 242,068 non-qualified options that vest 3 years from the date of grant. Options granted prior to fiscal 2017, as well as the options granted in fiscal 2017 expire 10 years from the date of grant.

The Company recognized stock-based compensation expense relating to stock options of $1,705 with a related tax benefit of $457 for fiscal 2017, $1,419 with a related tax benefit of $477 for fiscal 2016 and $1,470 with a related tax benefit of $502 for fiscal 2015.

For purposes of determining the fair value of stock options granted in fiscal 2017 and fiscal 2016, the Company used a Black-Scholes Model with the following assumptions:



	2017		2016		2015
Risk-free interest rate	1.41	%	1.79	%	1.94	%
Dividend yield	1.22	%	1.02	%	1.00	%
Expected life (years)	6		6		6
Volatility	30.4	%	32.75	%	40.48	%



	Number of Options		Weighted- Average Remaining Contract Term (Years)	Weighted- Average Exercise Price			Aggregate Intrinsic Value
Options outstanding as of March 31, 2014	66,173		1.4	$	14.77		$	3,608
Granted	76,512			69.85			—
Exercised	(39,868	)		14.50			1,819
Options outstanding as of March 31, 2015	102,817		7.0	$	55.86		$	1,291
Granted	127,966			68.40			—
Exercised	(11,986	)		14.64			639
Expired	(8,500	)		—			—
Options outstanding as of March 31, 2016	210,297		8.5	$	67.54		$	218
Granted	242,068			57.60		—	—
Exercised	(263	)		18.25		—	12
Expired	(434	)		—			—
Options outstanding as of March 31, 2017	451,668		8.4	$	62.29		$	7,520
Options exercisable as of March 31, 2017	98,788		7.2	$	66.55		$	1,224
Options vested and expected to vest, as of March 31, 2017	442,808		8.4	$	62.36		$	7,340



	Options Outstanding
Range of Exercise Prices	Number of Options	Weighted- Average Remaining Contractual Life	Weighted- Average Exercise Price
$15.01-$20.00	5,122	0.2	$	18.34
$55.01-$60.00	242,068	9.1	57.60
$65-01-$69.85	204,478	7.7	68.94
	451,668	8.4	$	62.29

In fiscal 2017, the Company granted to non-employee directors 25,708 deferred restricted stock units at the fair value of $69.97 per restricted stock unit at the date of grant. In fiscal 2016, such grants amounted to 28,970 restricted stock units at the fair value of $55.32 per restricted stock unit at the date of grant and in fiscal 2015, amounted to 14,781 restricted stock units at the fair value of $61.16 per restricted stock unit at the date of grant. The awards vest immediately upon the date of grant and are payable in shares of common stock six months after termination of service as a director.

In fiscal 2017, the Company granted 1,239 restricted stock units and in fiscal 2016 and 2015, granted 565 and 3,434 restricted stock units, respectively, at various fair values, under deferred compensation plans.

In fiscal 2017, the Company granted to management and other key employees 237,358 restricted stock units at the fair value of $57.60 per restricted stock unit and 83,720 performance market share units at a weighted average fair value of $70.79 per unit at the date of grant.

In fiscal 2016, the Company granted to management and other key employees 120,287 restricted stock units at the fair value of $68.40 per restricted stock unit and 212,635 performance market share units at a weighted average fair value of $59.94 per market share unit at the date of grant.

In fiscal 2015, the Company granted to management and other key employees 118,312 restricted stock units at the fair value of $69.83 per restricted stock unit and 152,300 market share units at a weighted average fair value of $70.42 per market share unit at the date of grant.

For purposes of determining the fair value of performance market share units granted in fiscal 2017, fiscal 2016, and fiscal 2015, the Company used a Monte Carlo Simulation with the following assumptions:



	2017		2016		2015
Risk-free interest rate	0.94	%	1.00	%	0.87	%
Dividend yield	—	%	—	%	—	%
Expected life (years)	3		3		3
Volatility	31.74	%	25.52	%	30.83	%

A summary of the changes in restricted stock units and market share units awarded to employees and directors that were outstanding under the Company’s equity compensation plans during fiscal 2017 is presented below:



	Restricted Stock Units (RSU)				Performance Market Share Units and Market Share Units (MSU)
	Number of RSU		Weighted- Average Grant Date Fair Value		Number of MSU		Weighted- Average Grant Date Fair Value
Non-vested awards as of March 31, 2016	502,440		$	51.26	548,946		$	64.46
Granted	264,305		56.40		83,720		70.79
Stock dividend	5,943		51.82		4,357		65.41
Performance factor	—		—		45,065		65.03
Vested	(160,453	)	50.63		(232,947	)	65.03
Canceled	(11,960	)	63.02		—		—
Non-vested awards as of March 31, 2017	600,275		$	51.96	449,141		$	65.41

The Company recognized stock-based compensation expense relating to restricted stock units and market share units of $17,480, with a related tax benefit of $4,210 for fiscal 2017, $18,184, with a related tax benefit of $4,446 for fiscal 2016 and $23,789, with a related tax benefit of $4,790 for fiscal 2015.