STOCKHOLDERS' EQUITY:

12 Months Ended

Mar. 31, 2012

STOCKHOLDERS' EQUITY:

STOCKHOLDERS' EQUITY:

12.          STOCKHOLDERS’ EQUITY:

The Company has authorized 200 million shares of $0.10 par value common stock and 1 million shares of $1.00 par value preferred stock.  The board of directors of the Company may designate the relative rights and preferences of the preferred stock when and if issued.  Such rights and preferences could include liquidation preferences, redemption rights, voting rights and dividends, and the shares could be issued in multiple series with different rights and preferences.  The Company currently has no plans for the issuance of any shares of preferred stock.

The Company has issued warrants to purchase shares of its common stock.  The following table shows outstanding warrants as of March 31, 2012:

	Number of warrants outstanding	Issued	Vesting date	Expiration date	Weighted average exercise price
AISS acquisition (fiscal 2003)	1,272,024	August 2002	August 2002	August 12, 2017	$	16.32
Toplander acquisition (fiscal 2003)	102,935	March 2004	March 2004	March 17, 2019	$	13.24
	1,374,959				$	16.09

On August 29, 2011, the board of directors adopted a common stock repurchase program for a twelve-month period ending August 23, 2012.  Under the repurchase program, the Company could purchase up to $50 million worth of its common stock.  Subsequently, the board of directors authorized the expansion of this existing stock repurchase program, effective December 5, 2011.  Under the expanded program, the Company may purchase up to an additional $39.1 million worth of its common stock, bringing the total amount authorized under the stock repurchase plan to $89.1 million through the period ending December 5, 2012.  Through March 31, 2012, the Company had repurchased 5.8 million shares of its common stock for $68.2 million.  Cash paid for repurchases of $65.5 million differs from the aggregate purchase price due to trades made at the end of the period which were settled subsequent to March 31, 2012.

The Company paid no dividends on its common stock for any of the years reported.

Stock Option Activity

The Company has stock option and equity compensation plans for which a total of 38.2 million shares of the Company’s common stock have been reserved for issuance since inception of the plans.  These plans provide that the exercise prices of qualified options will be at or above the fair market value of the common stock at the time of the grant.  Board policy has also required that nonqualified options be priced at or above the fair market value of the common stock at the time of grant.  At March 31, 2012, there were a total of 5.6 million shares available for future grants under the plans.

The per-share weighted-average fair value of the stock options granted during 2012 was $5.82.  This valuation was determined using a customized binomial lattice approach with the following weighted-average assumptions: dividend yield of 0.0%; risk-free interest rate of 2.2%; expected option life of 5.3 years; expected volatility of 44% and a suboptimal exercise multiple of 1.7.  The per-share weighted-average fair value of the stock options granted during 2011 was $7.54 on the date of grant using a customized binomial lattice approach with the following weighted-average assumptions:  dividend yield of 0.0%; risk-free interest rate of 3.4%; expected option life of 5.6 years; expected volatility of 52% and a suboptimal exercise multiple of 1.9.  The per-share weighted-average fair value of stock options granted during 2010 was $4.61 on the date of grant using a customized binomial lattice option pricing model with the following weighted-average assumptions: dividend yield of 0.0%; risk-free interest rate of 3.5%; expected option life of 5.4 years and expected volatility of 54%.

Total expense related to stock options was approximately $1.1 million for fiscal 2012, $2.4 million for fiscal 2011 and $2.4 million for 2010.  Future expense for these options is expected to be approximately $4.4 million in total over the next four years.

Activity in stock options was as follows:

	Number of shares		Weighted- average exercise price per share		Weighted- average remaining contractual term (in years)	Aggregate Intrinsic value (in thousands)
Outstanding at March 31, 2011	9,526,989		$	20.75
Granted	884,534
Exercised	(723,733	)				$	2,355
Forfeited or cancelled	(1,365,713	)
Outstanding at March 31, 2012	8,322,077		$	20.91	4.13	$	4,373
Exercisable at March 31, 2012	7,390,173		$	21.84	3.49	$	3,190

The aggregate intrinsic value for options exercised in fiscal 2010 was $1.1 million, for fiscal 2011 was $0.6 million and for fiscal 2012 was $2.4 million.  The aggregate intrinsic value at period end represents total pre-tax intrinsic value (the difference between Acxiom’s closing stock price on the last trading day of the period and the exercise price for each in-the-money option) that would have been received by the option holders had option holders exercised their options on March 31, 2012.  This amount changes based upon changes in the fair market value of Acxiom’s stock.

Following is a summary of stock options outstanding as of March 31, 2012:

	Options outstanding				Options exercisable
Range of exercise price per share	Options outstanding	Weighted- average remaining contractual life	Weighted- average exercise price per share		Options exercisable	Weighted- average exercise price per share
$   3.69 - $   9.62	128,457	5.79 years	$	8.61	74,457	$	8.41
$ 10.22 - $ 15.00	2,020,341	6.39 years	$	12.90	1,177,151	$	12.37
$ 15.10 - $ 19.82	2,021,967	3.69 years	$	16.61	1,987,253	$	16.59
$ 20.12 - $ 25.00	2,122,378	3.97 years	$	22.92	2,122,378	$	22.92
$ 25.98 - $ 29.30	1,106,336	2.44 years	$	26.70	1,106,336	$	26.70
$ 30.93 - $ 39.12	679,996	2.19 years	$	35.79	679,996	$	35.79
$ 40.50 - $ 62.06	242,602	2.55 years	$	44.08	242,602	$	44.08
	8,322,077	4.13 years	$	20.91	7,390,173	$	21.84

Restricted Stock Unit Activity

Non-vested non performance-based restricted stock units and changes during the year ended March 31, 2012 were as follows:

	Number of shares		Weighted average fair value per share at grant date (in thousands)		Weighted-average remaining contractual term (in years)
Outstanding at March 31, 2011	1,195,043		$	13.42	2.16
Granted	787,451		$	13.26
Vested	(513,707	)	$	12.51
Forfeited or cancelled	(293,626	)	$	13.30
Outstanding at March 31, 2012	1,175,161		$	13.40	2.21

During fiscal 2012, the Company granted non performance-based restricted stock units covering 787,451 shares of common stock with a value at the date of grant of $10.4 million.  Of the restricted stock units granted in the current period, 654,357 vest in equal annual increments over four years and 133,094 vest in one year.  During fiscal 2011, the Company granted non performance-based restricted stock units covering 539,729 shares of common stock with a value at the date of grant of $9.4 million.  Of the restricted stock units granted, 467,641 vest in equal annual increments over four years and 72,088 vest in one year.  During fiscal 2010, the Company granted non performance-based restricted stock units covering 946,000 shares of common stock with a value at the date of grant of $9.4 million.   All of the restricted stock units vest in equal annual increments over four years. Valuation of non performance-based restricted stock units for all periods presented is equal to the quoted market price for the shares on the date of grant.

Non-vested performance-based restricted stock units and changes during the year ended March 31, 2012 were as follows:

	Number of shares		Weighted average fair value per share at grant date (in thousands)		Weighted-average remaining contractual term (in years)
Outstanding at March 31, 2011	586,269		$	15.26	0.51
Granted	530,137		$	10.16
Vested	(470,779	)	$	13.02
Forfeited or cancelled	(133,763	)	$	19.63
Outstanding at March 31, 2012	511,864		$	10.91	2.31

During fiscal 2012, the Company granted performance-based restricted stock units covering 530,137 shares of common stock with a value at the date of grant of $5.4 million.  All of the performance-based restricted stock units granted in the current period vest subject to attainment of performance criteria established by the compensation committee of the board of directors.  Of the units granted in the current period, 172,945 may vest in a number of shares from zero to 200% of the award, based on the total shareholder return of Acxiom stock compared to total shareholder return of a group of peer companies established by the committee for the period from April 1, 2011 to March 31, 2014.  The remaining 357,192 units represent inducement awards granted to the Company’s chief executive officer, chief financial officer, and chief revenue officer.  The executive officers may vest in up to 100% of the award based on price targets for the Company’s common stock during the determination period from January 26, 2013 to July 26, 2014.  The value of the performance units is determined using a Monte Carlo simulation model.

During fiscal 2011, the Company granted performance-based restricted stock units covering 191,790 shares of common stock with a value at the date of grant of $4.7 million.  The grants vest subject to attainment of performance criteria established by the compensation committee of the board of directors.  Each recipient of the performance units may vest in a number of shares from zero to 200% of their award, based on the total shareholder return of Acxiom stock compared to total shareholder return of a group of peer companies established by the committee for the period from April 1, 2010 to March 29, 2013.  The value of the performance units was determined using a Monte Carlo simulation model.

During fiscal 2010, the Company granted performance-based restricted stock units covering 599,000 shares of common stock with a value at the date of grant of $5.4 million.   The grants vest subject to 1) the Company’s achievement of certain performance criteria and 2) the individual remaining employed by the Company for three years from the date of grant.  If both criteria are met the units vest after three years.  In fiscal 2011, all of the 599,000 performance units were cancelled as the performance criteria was not met.

The expense related to restricted stock was $7.8 million in fiscal 2012, $10.7 million in fiscal 2011, and $7.7 million in fiscal 2010.  Future expense for these restricted stock units is expected to be approximately $7.2 million in fiscal 2013, $5.3 million in fiscal 2014, $2.4 million in fiscal 2015 and $0.3 million in fiscal 2016.

Qualified Employee Stock Purchase Plan

In addition to the share-based plans, the Company maintains a qualified employee stock purchase plan (“ESPP”) that permits substantially all employees to purchase shares of common stock.  Prior to July 1, 2009 the employees were allowed to purchase shares of stock at 85% of the market price.  Subsequent to that date, all purchases by employees have been at the market price.  The number of shares available for issuance at March 31, 2012 was approximately 1.0 million.  Approximately 207,553 shares were purchased under the ESPP during the combined fiscal years 2012, 2011, and 2010.  There was no expense to the Company for the years ended March 31, 2012 and 2011.  The expense for 2010 for the discount to the market price was $0.1 million.

Accumulated Other Comprehensive Income

The accumulated balances for each component of other comprehensive income are as follows (dollars in thousands):

	March 31, 2012			March 31, 2011
Foreign currency translation	$	14,664		$	16,883
Unrealized loss on interest rate swap	(1,063		)	(892		)
	$	13,601		$	15,991