Disclosure of Compensation Related Costs, Share Based Payments

The 2009 Stock Incentive Plan (the “Plan”), was approved by the Board in June 2009 and approved by the shareholders in September 2009. The Plan replaced the 2000 Option Plan and the Non-employee Director Stock Plan (together, the “Prior Plans”). There are 2,657,030 shares available for grant at July 31, 2018. Awards made under the Plan may take the form of stock options, restricted stock or restricted stock units. Each share issued pursuant to a stock option will reduce the shares available for grant by one, and each share issued pursuant to an award of restricted stock or restricted stock units will reduce the shares available for grant by two. We account for stock-based compensation by estimating the fair value of stock options using the Black Scholes model, and value restricted stock unit awards granted under the Plan using the market price of a share of our common stock on the date of grant. For market based awards we use the "Monte Carlo" approach to estimate the value of the awards, which simulates the prices of the Company’s and each member of the peer groups' common stock price at the end of the relevant performance period, taking into account volatility and the specifics surrounding each total shareholder return metric under the relevant plan. We recognize these amounts as an operating expense in our consolidated statements of income ratably over the requisite service period using the straight-line method, as adjusted for certain retirement provisions. All awards have been granted at no cost to the grantee and/or non-employee member of the Board. Additional information regarding the Plan is provided in the Company’s 2009 Proxy Statement.

At July 31, 2018, options for 178,073 shares (which expire between 2019 and 2021) were outstanding for the Plan and Prior Plans. Information concerning the issuance of stock options under the Plan and Prior Plans is presented in the following table:



	Number of option shares	Weighted average option exercise price
Outstanding at April 30, 2018	181,673	$	39.48
Granted	—	—
Exercised	3,600	41.16
Forfeited	—	—
Outstanding at July 31, 2018	178,073	$	39.45

At July 31, 2018, all 178,073 outstanding options were vested, and had an aggregate intrinsic value of $12,452 and a weighted average remaining contractual life of 2.40 years. The aggregate intrinsic value for the total of all options exercised during the three months ended July 31, 2018, was $225.

Information concerning the unvested restricted stock units under the Plan is presented in the following table:




Unvested at April 30, 2018	338,981
Granted	164,248
Vested	(100,250	)
Forfeited	(361	)
Performance Award Adjustments	(7,717	)
Unvested at July 31, 2018	394,901

Total compensation costs recorded for the three months ended July 31, 2018 and 2017, respectively, were $10,154 and $9,807 for the stock option, restricted stock, and restricted stock unit awards to employees. As of July 31, 2018, there were no unrecognized compensation costs related to the Plan for stock options and $14,079 of unrecognized compensation costs related to restricted stock units which are expected to be recognized through fiscal 2022. Certain awards in the 2017 long term incentive plan grant have performance-based conditions based on the three-year average return on invested capital (ROIC) calculation. Based on the results of fiscal year 2018 and revised forecast for fiscal 2019 and 2020, adjustments were made to the shares awarded to the projected most likely outcome based on expected ROIC. The compensation costs related to this adjustment have been recorded in the first quarter of fiscal 2019.