Stock-Based Compensation

12 Months Ended

Mar. 31, 2022

Share-based Payment Arrangement [Abstract]

As of March 31, 2022, the Company maintains the 2017 Equity Incentive Plan (“2017 EIP”). The 2017 EIP reserved 4,173,554 shares of common stock for the grant of various classes of nonqualified stock options, restricted stock units, market condition-based on total shareholder return (“TSR”) and performance condition-based share units (“PSU”) 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 2017 EIP. Shares subject to stock option or stock appreciation right awards, that have been retained by the Company in payment or satisfaction of the exercise price and any applicable tax withholding obligation of such awards, shall not be available for future grant under the 2017 EIP.

As of March 31, 2022, 2,822,479 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.

Stock Options

During fiscal 2022, the Company granted to management and other key employees 246,222 non-qualified options that vest ratably over 3 years from the date of grant. Options expire 10 years from the date of grant.

The Company recognized stock-based compensation expense relating to stock options of $6,235, with a related tax benefit of $738 for fiscal 2022, $3,514 with a related tax benefit of $368 for fiscal 2021 and $2,996 with a related tax benefit of $565 for fiscal 2020.

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


	2022		2021		2020
Risk-free interest rate	0.89	%	0.39	%	1.52	%
Dividend yield	0.76	%	0.93	%	1.21	%
Expected life (years)	6		6		6
Volatility	37.3	%	37.2	%	29.1	%

The following table summarizes the Company’s stock option activity in the years indicated:


	Number of Options	Weighted- Average Remaining Contract Term (Years)	Weighted- Average Exercise Price		Aggregate Intrinsic Value
Options outstanding as of March 31, 2019	554,906	8.0	$	72.31	$	1,040
Granted	284,109		57.75		—
Exercised	(24,826)		57.60		383
Forfeited	(22,607)		72.19		88
Expired	—		—		—
Options outstanding as of March 31, 2020	791,582	7.8	$	67.55	$	—
Granted	295,068		79.62		—
Exercised	(247,975)		66.11		6,382
Forfeited	(34,854)		69.20		290
Expired	(4,320)		80.25		—
Options outstanding as of March 31, 2021	799,501	7.8	$	72.31	$	14,781
Granted	246,222		97.32		—
Exercised	(42,640)		65.71		1,079
Forfeited	(27,478)		71.26		520

Options outstanding as of March 31, 2022	975,605	7.5	$	78.94	$	3,605
Options exercisable as of March 31, 2022	472,571	6.1	$	72.71	$	2,250
Options vested and expected to vest, as of March 31, 2022	960,129	7.4	$	78.77	$	3,590

The following table summarizes information regarding stock options outstanding as of March 31, 2022:


Range of Exercise Prices	Number of Options	Weighted- Average Remaining Contractual Life (Years)	Weighted- Average Exercise Price
$57.60-$60.00	194,661	7.0	$	57.73
$60.01-$70.00	56,530	2.9	$	68.78
$70.01-$80.00	222,765	7.3	$	75.27
$80.01-$90.00	260,247	7.2	$	83.00
$90.01-100.99	241,402	9.4	$	97.43
	975,605	7.5	$	78.94

Restricted Stock Units, Market and Performance-condition based Awards

Non-Employee Directors

In fiscal 2022, the Company granted to non-employee directors 24,055 deferred restricted stock units (“DSU”) at the fair value of $60.29 per restricted stock unit at the date of grant. In fiscal 2021, such grants amounted to 39,726 restricted stock units at the fair value of $39.93 per restricted stock unit at the date of grant and in fiscal 2020, such grants amounted to 40,462 restricted stock units at the fair value of $39.74 per restricted stock unit at the date of grant. The awards vest immediately upon the date of grant and are settled in shares of common stock six months after termination of service as a director.

The Company also granted to non-employee directors, during fiscal 2022, fiscal 2021 and 2020, 781, 1,435 and 1,147 restricted stock units, respectively, at fair values of $88.27, $71.53 and $58.05, respectively, under the deferred compensation plan for non-employee directors.

Employees

In fiscal 2022, the Company granted to management and other key employees 229,600 restricted stock units that vest ratably over four years from the date of grant, at the fair value of $91.81 per restricted stock unit.

In fiscal 2021, the Company granted to management and other key employees 283,101 restricted stock units that vest ratably over four years from the date of grant at the fair value of $75.39 per restricted stock unit.

In fiscal 2020, the Company granted to management and other key employees 301,321 restricted stock units that vest ratably over four years from the date of grant at a fair value of $57.75 per restricted stock unit, 62,512 PSUs at the fair value of $50.69 and 51,063 TSRs at a weighted average fair value of $62.05 per unit at the date of grant, that cliff vest three years from the date of grant.

For purposes of determining the fair value of the PSUs granted in fiscal 2020, the Company used the market price at the date of grant to which a discount for illiquidity was applied to reflect post vesting restrictions.

For purposes of determining the fair value of TSRs granted in fiscal 2020, the Company used a Monte Carlo Simulation with the following assumptions:


	2020
Risk-free interest rate	1.50	%
Dividend yield	—	%
Expected life (years)	3
Volatility	34.39	%

A summary of the changes in restricted stock units, TSRs and PSUs awarded to employees and directors that were outstanding under the Company’s equity compensation plans during fiscal 2022 is presented below:


	Restricted Stock Units (RSU)			Market condition-based Share Units (TSR)			Performance condition-based Share Units (PSU)
	Number of RSU	Weighted- Average Grant Date Fair Value		Number of TSR	Weighted- Average Grant Date Fair Value		Number of PSU	Weighted- Average Grant Date
Non-vested awards as of March 31, 2021	880,284	$	60.07	125,960	$	83.48	98,346	$	57.55
Granted	254,436	88.27		—	—		—	—
Stock dividend	7,639	64.22		670	71.04		714	56.04
Performance factor	—	—		1,116	—		—	—
Vested	(228,765)	68.34		(46,295)	104.89		(670)	68.48
Forfeitures	(35,829)	73.40		(6,468)	70.77		(21,517)	64.25
Non-vested awards as of March 31, 2022	877,765	$	65.48	74,983	$	71.25	76,873	$	55.56

The Company recognized stock-based compensation expense relating to restricted stock units, TSRs and PSUs of $18,054, with a related tax benefit of $3,072 for fiscal 2022, $16,303, with a related tax benefit of $2,121 for fiscal 2021 and $17,784, with a related tax benefit of $2,544 for fiscal 2020.

All Award Plans

As of March 31, 2022, unrecognized compensation expense associated with the non-vested equity awards outstanding was $48,867 and is expected to be recognized over a weighted-average period of 24 months.