Share-based Payments

12 Months Ended

Mar. 31, 2024

18. Share-based Payments

2022 Incentive Award Plan (the “2022 Plan”)

In September 2022, the Company’s shareholders approved the 2022 Incentive Award Plan (the “2022 Plan”), which replaced the 2010 Incentive Award Plan and the 2014 Non-Employee Director Incentive Award Plan. Under the 2022 Plan, a total of 924,200 shares of the Company’s common stock were reserved for grants to its employees, non-employee directors, and consultants. At March 31, 2024 there were (i) 132,133 options to purchase shares of common stock outstanding, (ii) 100,624 shares of restricted stock units outstanding, and (iii) 581,227 shares of performance stock units outstanding under the 2022 Plan. At March 31, 2023, there were 52,768 shares of restricted stock units outstanding under the 2022 Plan. There were 430,129 and 871,432 shares of common stock available for grant under the 2022 Plan at March 31, 2024 and 2023, respectively.

2014 Non-Employee Director Incentive Award Plan

At March 31, 2024 there were no restricted stock units outstanding under the 2014 Non-Employee Director Incentive Award Plan. At March 31, 2023, there were 10,417 restricted stock units outstanding under this plan. No shares of common stock remain available for grant under this plan.

2010 Incentive Award Plan

At March 31, 2024 and 2023, respectively, there were (i) 140,299 and 266,169 shares of restricted stock units outstanding, (ii) 975,884 and 1,226,745 options to purchase shares of common stock outstanding, and (iii) 192,696 and 192,696 shares of performance stock units outstanding under the 2010 Incentive Award Plan. In addition, at March 31, 2023, there were 100,000 restricted shares outstanding. No shares of common stock remain available for grant under this plan.

2004 Non-Employee Director Stock Option Plan

In addition, at March 31, 2024, there were no options to purchase shares of common stock outstanding under the 2004 Non-Employee Director Stock Option Plan. At March 31, 2023, options to purchase 6,000 shares of common stock were outstanding under the 2004 Non-Employee Director Stock Option Plan. No options remain available for grant under this plan.

Stock Options

The Company granted options to purchase 132,133 shares of common stock during the year ended March 31, 2024. The Company did not grant any stock options during the years ended March 31, 2023 and 2022. The following summarizes the Black-Scholes option-pricing model assumptions used to derive the weighted average fair value of the stock options granted during the year ended March 31, 2024.

	Year Ended March 31,
	2024

Weighted average risk free interest rate		4.53	%
Weighted average expected holding period (years)		6.57
Weighted average expected volatility		51.29	%
Weighted average expected dividend yield		-
Weighted average fair value of options granted	$	3.75

The following is a summary of stock option transactions:

	Number of			Weighted Average
	Shares			Exercise Price

Outstanding at March 31, 2023		1,232,745		$	20.20
Granted		132,133		$	9.32
Exercised		-		$	-
Forfeited/Cancelled		(116,328	)	$	19.70
Expired		(140,533	)	$	9.66
Outstanding at March 31, 2024		1,108,017		$	20.29

At March 31, 2024, options to purchase 132,133 shares of common stock were unvested at the weighted average exercise price of $9.32.

Based on the market value of the Company’s common stock at March 31, 2024, 2023, and 2022, the pre-tax intrinsic value of options exercised was $0, $2,427,000, and $245,000, respectively. The total fair value of stock options vested during the years ended March 31, 2024, 2023, and 2022 was $324,000, $1,140,000, and $2,174,000, respectively.

The following summarizes information about the options outstanding at March 31, 2024:

		Options Outstanding								Options Exercisable
						Weighted								Weighted
				Weighted		Average						Weighted		Average
				Average		Remaining			Aggregate			Average		Remaining			Aggregate
Range of				Exercise		Life			Intrinsic			Exercise		Life			Intrinsic
Exercise price		Shares		Price		In Years			Value	Shares		Price		In Years			Value
$	9.32 to $17.38		341,027	$	12.99		7.43				208,894	$	15.32		6.14
$	19.00 to $22.73		410,633		19.58		4.78				410,633		19.58		4.78
$	22.93 to $27.40		164,133		26.35		2.55				164,133		26.35		2.55
$	28.68 to $31.13		192,224		29.60		1.95				192,224		29.60		1.95
			1,108,017	$	20.29		4.77	$	-		975,884	$	21.78		4.14	$	-

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, 2024 based on the Company’s closing stock price of $8.04 as of that date.

At March 31, 2024, there was $409,000 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 2.5 years.

Restricted Stock Units and Restricted Stock (collectively “RSUs”)

During the year ended March 31, 2024, the Company granted 100,624 of time-based vesting restricted stock units, based on the closing market price on the grant date. During the years ended March 31, 2023 and 2022, the Company granted (i) performance-based restricted stock awards which had a threshold performance level of 33,333 shares, a target performance level of 66,667 shares, and a maximum performance level of 100,000 shares at the grant date for both periods and (ii) 229,121 and 163,703 of time-based vesting restricted stock units, respectively. The estimated grant date fair value of the RSUs of $800,000, $4,430,000, and $5,775,000, for the years ended March 31, 2024, 2023, and 2022, respectively, 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 years ended March 31, 2024, 2023, and 2022 were 42,720, 74,854, and 84,762, respectively, based on the value of these awards as determined by the Company’s closing stock price on the vesting date.

The following is a summary of non-vested RSUs:

	Number of Shares			Weighted Average Grant Date Fair Value

Outstanding at March 31, 2023		429,354		$	15.07
Granted		100,624		$	7.95
Vested		(210,485	)	$	15.58
Forfeited/Cancelled		(78,570	)	$	13.28
Outstanding at March 31, 2024		240,923		$	12.23

As of March 31, 2024, there was $1,435,000 of unrecognized compensation expense related to these awards, which will be recognized over the remaining vesting period of approximately 0.9 years.

Performance Stock Units (“PSUs”)

During the year ended March 31, 2024, the Company granted 585,583 PSUs, which vest, subject to continued employment, as follows: (i) if the stock price is greater than or equal to $10.00 per share, then 1/3 of the grant will vest, (ii) if the stock price is greater than or equal to $15.00 per share then the next 1/3 of the grant will vest, and (iii) if the stock price is greater than or equal to $20.00 per share then the final 1/3 of the grant will vest. Recipients are eligible to vest in between 50% and 150% of the third tranche by achieving a stock price between $17.50 and $25.00 per share (each stock price target must be met for thirty consecutive trading days). The Company calculated the fair value of these PSUs individually for each tranche using the Monte Carlo Simulation Model at the grant date. Compensation cost is recognized over the estimated derived service period. Compensation cost related to these awards will not be adjusted even if the market condition is not met.

During the years ended March 31, 2023 and 2022, the Company granted 126,028 and 84,593 of performance-based PSUs (at target performance levels), respectively, to its executives, which typically cliff vest after three-years subject to continued employment. These awards are contingent and granted separately for each of the following metrics: adjusted EBITDA, net sales, and relative total shareholder return (“TSR”). Compensation cost is determined at the grant date and recognized on a straight-line basis over the requisite service period to the extent the conditions are deemed probable. The number of shares earned at the end of the three-year period will vary, based only on actual performance, from 0% to 150% of the target number of PSUs granted. Adjusted EBITDA and net sales are considered performance conditions. The Company will reassess the probability of achieving each performance condition separately each reporting period. TSR is considered a market condition because it measures the Company’s return against the performance of the Russell 3000, excluding companies classified as financials and real estate, over a given period of time. Compensation cost related to the TSR award will not be adjusted even if the market condition is not met. The Company calculated the fair value of the PSUs for each component individually.

The fair value of PSUs subject to performance conditions is equal to the closing stock price on the grant date. The fair value of PSUs subject to a market condition is determined using the Monte Carlo simulation model. The following table summarizes the assumptions used in determining the fair value of the awards subject to market conditions:

	Year Ended March 31,
	2024			2023			2022
Risk free interest rate		4.32-4.35	%		3.35	%		0.47	%
Expected life in years		0.2-1.8			3			3
Expected volatility of MPA common stock		54.2-55.1	%		51.30	%		53.70	%
Expected average volatility of peer companies		-	%		62.70	%		59.30	%
Average correlation coefficient of peer companies		-	%		27.50			26.70
Expected dividend yield		-			-			-
Grant date fair value	$	3.57-8.37		$	16.02		$	26.89

The following is a summary of non-vested PSUs:

	Number of Shares			Weighted Average Grant Date Fair Value
Outstanding at March 31, 2023		192,696		$	17.48
Granted		585,583		$	4.50
Vested		-		$	-
Forfeited/Cancelled		(4,356	)	$	5.79
Outstanding at March 31, 2024		773,923		$	7.73

At March 31, 2024, there was $1,361,000 of unrecognized compensation expense related to these awards, which will be recognized over the weighted average remaining vesting period of approximately 1.0 year.