The Company has a 2005 Stock Option Plan, a 2008 Stock Option Plan, a 2011 Stock Option Plan and a 2017 Stock Incentive Plan for the benefit of certain non-employee directors, officers, and key employees. Under these plans, a total of 4,350,000 shares of common stock have been authorized and reserved for issuance pursuant to grants approved by the Compensation Committee of the Board of Directors. Stock options granted under these plans have a maximum duration of 10 years, may be subject to certain vesting requirements, which are generally three to five years for officers, non-employee directors, and key employees, and are priced at the market value of the Company's common stock on the option's grant date. At December 31, 2019, there were a total of 193,070 shares of common stock available for grant under the plans.

Stock-based compensation is recognized as provided under FASB ASC Topic 718-10 and FASB ASC Topic 505-50. FASB ASC Topic 718-10 requires all share-based payments to employees, including grants of employee stock options, to be recognized as compensation expense over the requisite service period (generally the vesting period) in the consolidated financial statements based on their grant date fair values. The Company has applied the Black-Scholes valuation model in determining the grant date fair value of the stock option awards. Compensation expense is recognized only for those options expected to vest.

On October 15, 2018, the Compensation Committee and Board approved and adopted a new long-term incentive program that seeks to motivate and reward certain employees and to align management’s interest with shareholders' interest by focusing executives on the achievement of long-term results. The program is comprised of four components: Service Options, Performance Options, Restricted Stock, and Performance Shares.

Pursuant to this program, the Compensation Committee approved certain grants of Service Options, Performance Options, Restricted Stock and Performance Shares under the World Acceptance Corporation 2011 Stock Option Plan and the World Acceptance Corporation 2017 Stock Incentive Plan to certain employee directors, vice presidents of operations, vice presidents, senior vice presidents, and executive officers. Separately, the Compensation Committee approved certain grants of Service Options and Restricted Stock to certain of the Company's non-employee directors.

Under the long-term incentive program, up to 100% of the shares of restricted stock subject to the Performance Shares shall vest, if at all, based on the achievement of two trailing earnings per share performance targets established by the Compensation Committee that are based on earnings per share (measured at the end of each calendar quarter, commencing with the calendar quarter ending September 30, 2019) for the previous four calendar quarters. The Performance Shares are eligible to vest over the Performance Share Measurement Period and subject to each respective employee’s continued employment at the Company through the last day of the applicable Performance Share Measurement Period (or as otherwise provided under the terms of the applicable award agreement or applicable employment agreement).

The Restricted Stock awards vest in six equal annual installments, beginning on the first anniversary of the grant date, subject to each respective employee’s continued employment at the Company through each applicable vesting date or otherwise provided under the terms of the applicable award agreement or applicable employment agreement.

The Service Options vest in six equal annual installments, beginning on the first anniversary of the grant date, subject to each respective employee’s continued employment at the Company through each applicable vesting date or otherwise provided under the terms of the applicable award agreement or applicable employment agreement. The option price is equal to the fair market value of the common stock on the grant date and the Service Options have a 10-year term.

The Performance Options will fully vest if the Company attains the trailing earnings per share target over four consecutive calendar quarters occurring between September 30, 2018 and March 31, 2025 described below. Such performance target was established by the Compensation Committee and will be measured at the end of each calendar quarter commencing on September 30, 2019. The Performance Options are eligible to vest over the Option Measurement Period, subject to each respective employee’s continued employment at the Company through the last day of the Option Measurement Period or as otherwise provided under the terms of the applicable award agreement or applicable employment agreement. The option price is equal to the fair market value of the common stock on the grant date and the Performance Options have a 10-year term. The Performance Option performance target is set forth below.

The weighted-average fair value at the grant date for options issued during the nine months ended December 31, 2019 and 2018 was $64.49 and $53.12, respectively. Fair value was estimated at grant date using the weighted-average assumptions listed below:



	Three months ended December 31,		Nine months ended December 31,
	2019	2018	2019	2018

Dividend Yield	—%	—%	—%	—%
Expected Volatility	52.87%	48.95%	52.09%	48.95%
Average risk-free rate	1.64%	3.06%	1.66%	3.06%
Expected Life	6.0 years	6.7 years	6.2 years	6.7 years

The expected stock price volatility is based on the historical volatility of the Company's common stock for a period approximating the expected life. The expected life represents the period of time that options are expected to be outstanding after the grant date. The risk-free rate reflects the interest rate at grant date on zero coupon U.S. governmental bonds having a remaining life similar to the expected option term.



	Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value

Options outstanding, beginning of period	704,240		$	85.33
Granted during period	16,421		126.15
Exercised during period	(69,181	)	66.35
Forfeited during period	(10,093	)	98.68
Expired during period	(1,620	)	30.89
Options outstanding, end of period	639,767		$	88.36	6.7 years	$	4,285,681
Options exercisable, end of period	320,479		$	74.84	4.6 years	$	4,217,480

The aggregate intrinsic value reflected in the table above represents the total pre-tax intrinsic value (the difference between the closing stock price on December 31, 2019 and the exercise price, multiplied by the number of in-the-money options) that would have been received by option holders had all option holders exercised their options as of December 31, 2019. This amount will change as the market price of the common stock changes. The total intrinsic value of options exercised during the periods ended December 31, 2019 and 2018 was as follows:

As of December 31, 2019, total unrecognized stock-based compensation expense related to non-vested stock options amounted to approximately $11.7 million, which is expected to be recognized over a weighted-average period of approximately 4.4 years.

During the first nine months of fiscal 2020, the Company granted 7,203 shares of restricted stock (which are equity classified) to certain vice presidents, senior vice presidents, executive officers and non-employee directors, with a grant date weighted average fair value of $93.88 per share.

During fiscal 2019, the Company granted 760,420 shares of restricted stock (which are equity classified), to certain vice presidents, senior vice presidents, executive officers, and non-employee directors with a grant date weighted average fair value of $101.61.

During fiscal 2018, the Company granted 24,456 shares of restricted stock (which are equity classified) to certain executive officers, with a grant date weighted average fair value of $107.52 per share. One-third of these awards vest on each anniversary of the grant date over the three years following the grant date.

Compensation expense related to restricted stock is based on the number of shares expected to vest and the fair market value of the common stock on the grant date. The Company recognized compensation expense of $18.5 million and $7.5 million for the nine months ended December 31, 2019 and 2018, respectively, which is included as a component of general and administrative expenses in the Company’s consolidated statements of operations.

As of December 31, 2019, there was approximately $48.0 million of unrecognized compensation cost related to unvested restricted stock awards, which is expected to be recognized over the next 3.7 years based on current estimates.



	Shares		Weighted Average Fair Value at Grant Date

Outstanding at March 31, 2019	783,450		$	100.66
Granted during the period	7,203		93.88
Vested during the period	(89,419	)	92.93
Forfeited during the period	—		—
Outstanding at December 31, 2019	701,234		$	101.57



	Three months ended December 31,				Nine months ended December 31,
	2019		2018		2019		2018
Stock-based compensation related to equity classified awards:
Stock-based compensation related to stock options	$	1,168,033	$	1,361,349	$	4,394,143	$	2,424,986
Stock-based compensation related to restricted stock, net of adjustments and exclusive of cancellations	5,162,777		5,565,768		18,539,144		7,480,117
Total stock-based compensation related to equity classified awards	$	6,330,810	$	6,927,117	$	22,933,287	$	9,905,103