Note 8. Share-Based Compensation

The Company records share-based compensation expense in respect of options, multi-year performance based restricted stock units (“MRSUs”) and restricted stock units (“RSUs”) issued under its share incentive plans. Share-based compensation expense amounted to $1,380 and $814 in the nine month periods ended December 31, 2015 and December 31, 2014, respectively.

Share option activity

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, 2015		1,208,118		$	5.58		103
Granted		396,427			14.86		120
Exercised		(8,612	)		4.66		—
Forfeited		(6,695	)		12.08		—
Outstanding — December 31, 2015		1,589,238		$	7.87		99
Exercisable —December 31, 2015		634,466		$	4.13		91

The closing price of the Company’s Ordinary Shares on The NASDAQ Global Market on December 31, 2015 was $16.00.

The following table summarizes the options granted in the current financial year with their exercise prices, the fair value of ordinary shares as of the applicable grant date, and the intrinsic value:

Grant Date	Number of Options Granted		Exercise Price		Ordinary Shares Fair Value Per Share at Grant Date		Per Share Intrinsic Value of Options
May 20, 2015		312,300	$	15.17	$	15.17	$	6.08
August 5, 2015		8,000	$	16.70	$	16.70	$	6.54
September 2, 2015		25,000	$	16.34	$	16.34	$	6.52
October 31, 2015		39,727	$	11.62	$	11.62	$	4.76
November 4, 2015		11,400	$	13.00	$	13.00	$	5.33

Determining the fair value of share incentive awards

The fair value of each share incentive grant was determined by the Company using the Black-Scholes options pricing model.

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 volatilities of a number of the Company’s publicly listed peers over a period equal to the expected terms of the options as the Company did not have a sufficient trading history to use the volatility of its own ordinary shares.

Fair value of ordinary shares. The fair value of the ordinary shares is based upon the closing price of the Company’s shares on The NASDAQ Global Market on the last trading day prior to the date of grant.

Risk-Free Interest Rate. The risk-free interest rate is based on the US Treasury 10-year bond yield in effect at the time of grant.

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 assumptions applicable to the share options issued in the current financial year is as follows:

	May 20, 2015			August 5, 2015			September 2, 2015			October 31, 2015			November 4, 2015
Risk-free interest rate		2.29	%		2.27	%		2.18	%		2.14	%		2.23	%
Expected lives (years)		3			3			3			3			3
Volatility		57.14	%		55.67	%		57.01	%		58.86	%		58.86	%
Dividend yield		—			—			—			—			—
Grant date fair value (per share)	$	15.17		$	16.70		$	16.34		$	11.62		$	13.00
Number granted		312,300			8,000			25,000			39,727			11,400

The Company awarded 137,000 MRSUs on May 20, 2015. These MRSUs will vest if the volume weighted average price of the Company’s ordinary shares exceeds $60 for a continuous twenty day period between April 1, 2018 and December 31, 2018. The Company determined the grant date fair value of the MRSUs using a barrier option pricing model with the same grant date fair value per share, risk free interest rate, volatility and dividend yield assumptions as the options awarded on the same date. This resulted in a grant date fair value of $6.09 per MRSU on May 20, 2015. On September 2, 2015 the Company issued 25,000 RSUs which will vest if specific sales performance targets are met prior to December 31, 2022. The Company expects these performance targets to be met and share based compensation expense is being recognized on these awards over the period to the date when the sales performance targets are expected to be achieved. The Company also issued 10,000 RSUs on May 20, 2015, 9,867 RSUs on September 4, 2015 and 10,328 RSUs on October 31, 2015 which vest over a two year period from the date of grant. On November 4, 2015 the Company issued 8,000 RSUs which vest over a three year period from the date of grant.

During the quarter ended September 30, 2014, the Company awarded 50,000 RSUs to a non-executive director upon his appointment as a director of the Company. These vest in equal annual installments over the four year period following the date of grant. During the nine months ended December 31, 2015, 12,500 of these RSUs vested resulting in the issuance of 12,500 ordinary shares and at December 31, 2015, 37,500 of these RSUs remained outstanding.