The Company records share-based compensation expense in respect of options and restricted share units ("RSUs"), issued under its share incentive plans and in respect of deferred shares issued to employees. Share-based compensation expense amounted to $6,951 in the year ended March 31, 2022 and $4,984 in the year ended March 31, 2021.

The 2012 Option Plan (the "Option Plan") was designed in order to grant options on ordinary shares in the capital of the Company to certain of its directors and employees. The purpose of the Option Plan is to provide employees with an opportunity to participate directly in the growth of the value of the Company by receiving options for shares.

The total number of shares in respect of which options may be granted under the 2012 Option Plan is limited at 839,509. Options generally vest over a period of three years but certain employees have shorter vesting periods. The contractual life of all options is 10 years. Options were not exercisable before the Company became a public company and all outstanding options become exercisable in the event of an acquisition of 75% or more of the share capital of the Company by a third party. No further awards will be granted under the 2012 Option Plan.

The 2014 Stock Incentive Plan was approved by the directors and shareholders immediately prior to the Company’s initial public offering in April 2014. The 2014 Plan was designed to provide flexibility to attract and retain the services of qualified employees, officers, directors, consultants and other service providers upon whose judgment, initiative and efforts the successful conduct and development of the business depends, and to provide additional incentives to such persons to devote their effort and skill to the advancement and betterment of the Company, by providing them an opportunity to participate in the ownership of the Company and thereby have an interest in its success and increased value.

Under the 2014 Plan, 1,500,000 ordinary shares were initially reserved for issuance. This number is subject to adjustment in the event of a recapitalization, share split, share consolidation, reclassification, share dividend or other change in the Company’s capital structure and automatically increases annually on April 1 of each year. A resolution passed at the Annual Shareholder meeting held on October 29, 2020 amended this annual automatic increase to 0.75% of the number of ordinary shares issued and outstanding on the immediately preceding March 31, or such lesser number of shares as determined by the Board or the remuneration committee. The number of shares reserved for issuance under the plan was also increased by 750,000 as a result of a resolution passed at the Annual Shareholder meeting held on October 28, 2016, by 550,000 as a result of a resolution passed at the Annual Shareholder meeting held on October 31, 2018 and by a further 750,000 as a result of a resolution passed at the Annual Shareholder meeting held on October 29, 2020. The plan provides for the issuance of share options, restricted shares, RSUs (including multi-year performance based restricted share units or "MRSUs") or share appreciation rights ("SARs"). The Company has only issued options, RSUs and MRSUs under the plan prior to March 31, 2022. To the extent that an award terminates, or expires for any reason, then any shares subject to the award may be used again for new grants. However, shares which are (i) not issued or delivered as a result of the net settlement of outstanding SARs or options; (ii) used to pay the exercise price related to outstanding options; (iii) used to pay withholding taxes related to outstanding options or SARs; or (iv) repurchased on the open market with the proceeds from an option exercise, will not be available for grant under the 2014 Plan. As of March 31, 2022, there were 1.4 million shares available for future grants under the 2014 Plan.

The following table summarizes share option activity:


	Number of Share Options Outstanding			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Months)
Outstanding — March 31, 2021		1,810,785		$	7.69		68
Granted		1,907,605			3.22		120
Exercised		(4,837	)		1.44		—
Forfeited		(863,005	)		7.13		—
Outstanding — March 31, 2022		2,850,548		$	4.88		90
Exercisable — March 31, 2022		1,128,881		$	7.46		57

The following table summarizes the options granted in the year ended March 31, 2022 with their exercise prices, the fair value of ordinary shares as of the applicable grant date, and the intrinsic value, if any:


Grant Date	Number of Options Granted		Exercise Price		Ordinary Shares Fair Value Per Share at Grant Date		Per Share Intrinsic Value of Options
April 1, 2021 (1)		857,015	$	3.68	$	3.68	$	2.41
June 10, 2021		133,386		4.37		4.37		2.85
August 1, 2021		118,734		3.41		3.41		2.21
August 3, 2021		4,556		3.38		3.38		2.20
September 1, 2021		36,813		3.07		3.07		2.01
October, 4, 2021		147,134		2.72		2.72		1.79
October 5, 2021		235,477		2.91		2.91		1.91
October 31, 2021		144,240		2.53		2.53		1.66
November 19, 2021		123,267		2.08		2.08		1.37
February 1, 2022		106,983		1.62		1.62		1.54

(1)

On April 1, 2021, in connection with the appointment of Manuel O. Méndez as Chief Executive Officer, we granted Mr. Méndez 857,015 options to purchase ordinary shares at an exercise price of $3.68 per share. These grants, which were issued outside of our 2014 Stock Incentive Plan, were approved by our Board of Directors and the Remuneration Committee of our Board pursuant to the inducement grant exception under Nasdaq Rule 5635(c)(4), as an inducement that is material to Mr. Méndez joining our Company. The options vest in three equal installments on each first, second and third anniversary of the grant date. The options have a term of ten years and will be forfeited if not exercised before the expiration of their term. In addition, in the event Mr. Méndez’s service is terminated, any options not vested shall be forfeited upon termination. During the quarter ended December 31, 2021, 138,227 of the stock options originally granted to Mr. Méndez were cancelled and cash settled in connection with an amendment to his employment agreement with the Company and shown as forfeited in the share option activity table.

The fair value of each grant of share options was determined by the Company using the Black-Scholes options pricing model. The total fair value of option awards in the years ended March 31, 2022 and March 31, 2021 amounted to $6,150 and $889, respectively.

Assumptions used in the option pricing models are discussed below. Each of these inputs is subjective and generally requires significant judgment to determine.

Expected volatility. The expected volatility was based on the historical share volatility of the Company’s ordinary shares over a period equal to the expected terms of the options.

Fair value of ordinary shares. The fair value of ordinary shares has been based on the share price of the Company’s shares on the Nasdaq Global Market immediately prior to the grant of the options concerned.

Risk-Free Interest Rate. The risk-free interest rate is based on the grant date yield of the 10 year U.S. Treasury bond

Expected term. The expected term is determined after giving consideration to the contractual terms of the share-based awards, graded vesting schedules ranging from one to three years and expectations of future employee behavior as influenced by changes to the terms of its share-based awards.

Expected dividend. According to the terms of the awards, the exercise price of the options is adjusted to take into account any dividends paid. As a result, dividends are not required as an input to the model, as these reductions in the share price are offset by a corresponding reduction in exercise price.

A summary of the weighted-average assumptions applicable to the share options is as follows:


	Year-ended March 31,
	2022			2021
Risk-free interest rate		1.61	%		0.77	%
Expected lives (years)		6			6
Volatility		74.40	%		73.70	%
Dividend yield		—			—
Grant date fair value (per share)	$	3.22		$	5.38
Number granted		1,907,605			258,026

At March 31, 2022, 2,267,648 RSUs were subject to time based vesting and the weighted average remaining vesting period was 13 months. In addition, 24,549 RSUs were subject to vesting based on the achievement of various business milestones related mainly to the development, approval and marketing of MosaiQ. 1,225,361 RSUs were subject to vesting based on the achievement of financial objectives in the year 2024. During the year-ended March 31, 2022, 181,159 of the outstanding RSUs were cancelled and cash settled in connection with an amendment to the employment agreement between Mr. Méndez and the Company. The Company recognized $820 in stock compensation related to the cash settlement of Mr. Méndez's RSU and stock options described above.

The fair value of the Company’s ordinary shares was $1.20 per share on March 31, 2022.

As of March 31, 2022, total compensation cost related to share options and RSUs granted but not yet recognized was $10.0 million net of estimated forfeitures. This cost will be amortized to expense over a weighted average remaining period of 25 months and will be adjusted for subsequent changes in estimated forfeitures.