19. Share-based Payments

At the Company’s Annual Meeting of Shareholders held on December 17, 2003, the shareholders approved the Company’s 2003 Long-Term Incentive Plan (“Incentive Plan”) which had been adopted by the Company’s Board of Directors on October 31, 2003. Under the Incentive Plan, a total of 1,200,000 shares of the Company’s common stock were reserved for grants of Incentive Awards and all of the Company’s employees are eligible to participate. The 2003 Incentive Plan was terminated on October 31, 2013. As of March 31, 2015 and 2014, options to purchase 438,750 and 467,500 shares of common stock, respectively, were outstanding under the Incentive Plan. In January 2011, this Incentive Plan was replaced and no options were available for grant under the Incentive Plan.

In November 2004, the Company’s shareholders approved the 2004 Non-Employee Director Stock Option Plan (the “2004 Plan”) which provides for the granting of options to non-employee directors. At the Company’s Annual Meeting of Shareholders held on February 25, 2010, the Company’s shareholders approved an amendment to the 2004 Plan that increased the number of shares of common stock reserved for grant under the 2004 Plan from 175,000 to 275,000. As of March 31, 2015 and 2014, options to purchase 183,000 shares of common stock were outstanding for both years under the 2004 Plan. In March 2014, the 2004 Plan was replaced and no options were available for grant under this plan.

In January 2011, the Company’s shareholders approved the 2010 Incentive Award Plan (the “2010 Plan”) which replaced the 2003 Long-term Incentive Plan. At the Company’s Annual Meeting of Shareholders held on March 28, 2013, the Company’s shareholders approved an amendment and restatement of the 2010 Plan that increased the number of shares of common stock reserved for grant under the 2010 Plan from 750,000 to 1,750,000. At the Company’s Annual Meeting of Shareholders held on March 31, 2014, the Company’s shareholders approved the second amendment and restatement of the 2010 Plan that further increased the number of shares of common stock reserved for grant under the 2010 Plan from 1,750,000 to 2,750,000. Under the 2010 Plan, all of the Company’s employees are eligible to participate. As of March 31, 2015 and 2014, options to purchase 767,504 and 776,468 shares of common stock, respectively, were outstanding and 1,165,740 and 1,452,983 shares of common stock, respectively, were available for grant under the 2010 Plan.

At the Company’s Annual Meeting of Shareholders held on March 31, 2014, the shareholders approved the Company’s 2014 Non-Employee Director Incentive Award Plan (the “2014 Plan”) which had been adopted by the Company’s Board of Directors on February 23, 2014 and replaced the 2004 Plan. Under the 2014 Plan, a total of 342,000 shares of the Company’s common stock are reserved for grants to the Company’s non-employee directors. As of March 31, 2015, 10,656 shares of restricted stock were issued. As of March 31, 2015 and 2014, no options to purchase shares under the 2014 Plan were issued and 323,885 and 342,000 shares of common stock, respectively, were available for grant under the 2014 Plan.

The shares of common stock issued upon exercise of a previously granted stock option are considered new issuances from shares reserved for issuance upon adoption of the various plans. The Company requires that the option holders provide a written notice of exercise to the stock plan administrator and payment for the shares prior to issuance of the shares.

The following is a summary of stock option activity during the year ended March 31, 2015:

	Number of Shares			Weighted Average Exercise Price
Outstanding at March 31, 2014		1,426,968		$	9.21
Granted		82,537		$	22.99
Exercised		(108,734	)	$	9.81
Cancelled		(11,517	)	$	10.32
Outstanding at March 31, 2015		1,389,254		$	9.97

Based on the market value of the Company’s common stock at March 31, 2015, 2014 and 2013, the pre-tax intrinsic value of options exercised was $1,955,000, $12,593,000 and $493,000 respectively. The total fair value of stock options vested during the years ended March 31, 2015, 2014, and 2013 was $978,000, $459,000, and $687,000, respectively.

The following table summarizes information about the options outstanding at March 31, 2015:

		Options Outstanding								Options Exercisable
Range of Exercise price		Shares		Weighted Average Exercise Price		Weighted Average Remaining Life In Years		Aggregate Intrinsic Value		Shares		Weighted Average Exercise Price		Aggregate Intrinsic Value
$	4.170 to $6.250		81,000	$	5.22		4.02	$	1,828,000		80,000	$	5.20	$	1,808,000
$	6.460 to $7.430		458,335		6.52		7.45		9,749,000		430,637		6.53		9,156,000
$	8.700 to $9.900		251,299		9.34		8.22		4,636,000		77,236		9.39		1,421,000
$	10.010 to $11.900		195,250		10.21		0.81		3,432,000		195,250		10.21		3,432,000
$	12.000 to $25.510		403,370	$	15.12		3.96		5,111,000		285,112	$	12.31		4,414,000

			1,389,254	$	9.97		5.44	$	24,756,000		1,068,235	$	8.85	$	20,231,000

The aggregate intrinsic values in the above table represent the pre-tax value of all in-the-money options if all such options had been exercised on March 31, 2015 based on the Company’s closing stock price of $27.79 as of that date.

At March 31, 2015, there was $1,446,000 of total unrecognized compensation expense from stock-based compensation granted under the plans, which is related to non-vested shares. The compensation expense is expected to be recognized over a weighted average vesting period of 1.5 years.

Restricted Stock or Restricted Stock Units (collectively “RS”)

During the years ended March 31, 2015 and 2014, the Company granted 95,645 and 138,000 shares of RS, respectively, with an estimated grant date fair value of $2,316,000 and $1,286,000, respectively, which was based on the closing market price on the date of grant. The fair value related to these awards is recognized as compensation expense over the vesting period. These awards generally vest in three equal installments beginning each anniversary from the grant date, subject to continued employment. Upon vesting, these awards may be net share settled to cover the required withholding tax with the remaining amount converted into an equivalent number of shares of common stock. Total shares withheld during the year ended March 31, 2015 were 27,183 and was based on the value of these awards as determined by the Company’s closing stock price on the vesting date. There were no shares withheld during the year ended March 31, 2014.

The following is a summary of changes in the status of non-vested RS during the year ended March 31, 2015:

	Number of Shares			Weighted Average Grant Date Fair Value
Non-vested restricted stock at March 31, 2014		138,000		$	9.32
Restricted stock granted		95,645		$	24.21
Restricted stock vested		(50,402	)	$	10.51
Restricted stock cancelled		(1,800	)	$	9.32
Non-vested restricted stock at March 31, 2015		181,443		$	16.84

As of March 31, 2015, there was $2,283,000 of unrecognized compensation expense related to these awards, which will be recognized over the remaining vesting period of approximately 1.9 years.