SHARE-BASED COMPENSATION

9 Months Ended

Dec. 31, 2011

SHARE-BASED COMPENSATION

SHARE-BASED COMPENSATION

Note 5.   SHARE-BASED COMPENSATION

The provisions of ASC 718-10-55 requires the measurement and recognition of compensation expense for all share-based payment awards made to our employees and directors, including employee stock options, based on estimated fair values. The following table summarizes stock-based compensation expense related to employee stock options and employee stock purchases for the three months ended December 31, 2011 and 2010, which was allocated as follows:

	Three Months Ended					Nine Months Ended
	December 31, 2011			December 31, 2010		December 31, 2011		December 31, 2010
Cost of sales	$	734		$	823	$	2,202	$	2,469
Sales and marketing	(2,447		)	3,268		2,577		9,804
General and administrative	9,029			18,731		41,177		55,765
Research and development	2,850			3,722		8,551		11,166
Stock-based compensation expense	$	10,166		$	26,544	$	54,507	$	79,204

The Black-Scholes model requires the use of actual employee exercise behavior data and the application of a number of assumptions, including expected volatility, risk-free interest rate and expected dividends. Stock options of 20,000 and 235,000 were granted during the three and nine months ended December 31, 2011, respectively.

As of December 31, 2011, $222,000 of total unrecognized compensation costs related to nonvested stock options is expected to be recognized over a period of five years.