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Note 8 - Stockholders' Equity

6 Months Ended

Sep. 30, 2022

Notes to Financial Statements

Share-Based Payment Arrangement [Text Block]

Note 8. Stockholders' Equity

Stock-Based Compensation

During the six months ended September 30, 2022, we issued stock options, restricted stock units ("RSUs") and performance-based restricted stock units ("PSUs") pursuant to the Mesa Laboratories, Inc. 2021 Equity Incentive Plan (the "2021 Equity Plan"), which authorizes the issuance of 330 shares of common stock to eligible participants.

Expense recognized related to stock-based compensation is as follows:

		*Three Months Ended September 30,*								*Six Months Ended September 30,*
		*2022*				*2021*				*2022*				*2021*
Stock-based compensation expense		$	4,371			$	2,039			$	7,803			$	4,236
Amount of income tax (benefit) recognized in earnings			(89	)			(719	)			(2,081	)			(3,504	)
Stock-based compensation expense, net of tax		$	4,282			$	1,320			$	5,722			$	732

Stock-based compensation expense is included in cost of revenues, selling, general and administrative, and research and development expense in the accompanying unaudited Condensed Consolidated Statements of Operations.

The following is a summary of stock option award activity for the six months ended September 30, 2022:

		*Stock Options*
		*Shares Subject to Options*				*Weighted- Average Exercise Price per Share*				*Weighted-Average Remaining Contractual Life (Years)*				*Aggregate Intrinsic Value*
Outstanding as of March 31, 2022			202			$	167.14				2.9			$	18,261
Awards granted			42				185.57
Awards forfeited or expired			(6	)			227.42
Awards exercised			(42	)			101.34
Outstanding as of September 30, 2022			196			$	183.13				3.2			$	1,978

The stock options granted during the six months ended September 30, 2022 vest in equal installments on the first, second, and third anniversary of the grant date.

The following is a summary of RSU award activity for the six months ended September 30, 2022:

		*Time-Based Restricted Stock Units*								*Performance-Based Restricted Stock Units*
		*Number of Shares*				*Weighted- Average Grant Date Fair Value per Share*				*Number of Shares*				*Weighted- Average Grant Date Fair Value per Share*
Outstanding as of March 31, 2022⁽¹⁾			51			$	252.86				55			$	288.45
Awards granted⁽¹⁾			39				187.44				19				172.15
Performance adjustment⁽²⁾			-				-				2				202.00
Awards forfeited			(5	)			241.94				-				-
Awards distributed⁽²⁾			(24	)			247.29				(10	)			202.00
Outstanding as of September 30, 2022⁽¹⁾			61			$	214.47				66			$	265.39

⁽¹⁾	Balances for performance-based restricted stock units ("PSUs") are reflected at target.

⁽²⁾	During the six months ended September 30, 2022, the fiscal year 2020 PSUs vested and were distributed at 126% of target, based on actual performance results and completion of service conditions.

The outstanding time-based RSUs vest and settle in shares of our common stock on a one-for-one basis. Substantially all of the RSUs granted during the six months ended September 30, 2022 vest in equal installments on the first, second, and third anniversary of the grant date. We recognize the expense relating to RSUs, net of estimated forfeitures, on a straight-line basis over the vesting period.

PSUs vest upon completion of the service period described in the award agreement and based on achievement of the performance targets described in the award agreements. We recognize the expense relating to the performance-based RSUs based on the probable outcome of achievement of the performance targets on a straight-line basis over the service period.

During the six months ended September 30, 2022, the Compensation Committee of the Board of Directors created a plan to award 19 PSUs at target (the "FY 23 PSUs") that are subject to both service and performance conditions to eligible employees. The performance period for the FY 23 PSUs is from April 1, 2022 until March 31, 2023 and the service period is from April 1, 2022 until March 31, 2025. Of the total FY 23 PSUs granted, 13 vest based on our achievement of specific performance criteria during fiscal year 2023 and they have a grant date fair value of $185.57. The remaining 6 awards will be settled in shares of our common stock, but they are subject to performance criteria that are subjective and as such do not have a grant date. The awards will be marked-to-market each reporting period during the performance period. The quantity of shares that will be issued upon vesting will range from 0% to 200% of the targeted number of shares; if the defined minimum targets are not met, then no shares will vest.

During fiscal year 2020, we awarded 8 PSUs (the "FY 20 PSUs") subject to both service and performance conditions to eligible employees. The FY 20 PSUs had a grant date fair value of $202.00 per share and vested during the six months ended September 30, 2022. Based on actual performance targets achieved, the awards vested at 126% of target, resulting in a total of 10 awards distributed.