3.SHARE-BASED COMPENSATION:

Share-based Compensation Plans

The Company has stock option and equity compensation plans for which a total of 28.9 million shares of the Company’s common stock have been reserved for issuance since the 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 requires that nonqualified options also be priced at or above the fair market value of the common stock at the time of grant. At September 30, 2016, there were a total of 2.2 million shares available for future grants under the plans.

Stock Option Activity

Stock option activity for the six-month period ended September 30, 2016 was:


				Weighted-‑average
		Weighted-average		remaining	Aggregate
	Number of	exercise price		contractual term	Intrinsic value
	shares	per share		(in years)	(in thousands)
Outstanding at March 31, 2016	3,604,102	$	14.52
Exercised	(498,180)	$	13.82		$	4,848
Forfeited or cancelled	(47,833)	$	16.24
Outstanding at September 30, 2016	3,058,089	$	14.60	5.4	$	36,961
Exercisable at September 30, 2016	2,353,864	$	14.49	4.6	$	28,685

The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value (the difference between Acxiom’s closing stock price on the last trading day of the quarter and the exercise price for each in-the-money option) that would have been realized by the option holders had option holders exercised their options on September 30, 2016. This amount changes based upon changes in the fair market value of Acxiom’s common stock.

A summary of stock options outstanding and exercisable as of September 30, 2016 is presented below:


					Options outstanding					Options exercisable
Range of						Weighted-average		Weighted-average			Weighted-average
exercise price					Options	remaining		exercise price		Options	exercise price
per share					outstanding	contractual life		per share		exercisable	per share

$	0.85	-	$	9.99	581,070	6.6	years	$	1.86	403,973	$	1.80
$	10.00	-	$	19.99	1,611,798	5.3	years	$	15.22	1,294,109	$	14.59
$	20.00	-	$	24.99	845,669	4.6	years	$	21.77	646,008	$	21.95
$	25.00	-	$	32.85	19,552	7.1	years	$	32.85	9,774	$	32.85
					3,058,089	5.4	years	$	14.60	2,353,864	$	14.49

Total expense related to stock options for the six months ended September 30, 2016 and 2015 was approximately $3.5 million and $5.9 million, respectively. Future expense for these options is expected to be approximately $6.1 million over the next four years.

Performance Stock Option Unit Activity

On June 29, 2016, the Company granted 633,604 performance-based stock option units with a value at the date of grant of $4.9 million, determined using a Monte Carlo simulation model. All of the units granted in the current period vest and become exercisable in three equal tranches, each being subject to attainment of performance criteria and a subsequent service period established by the compensation committee of the board of directors (“Comp Committee”). Each of the three tranches may vest in a number of stock options, from zero to 300% of the initial award, each having an exercise price of $21.40, based on the attainment of certain revenue growth and operating margin targets for the years ending March 31, 2017, 2018, and 2019 respectively. Each tranche is subject to a service period following the respective performance periods, such that each tranche will cliff vest in two separate 50% increments over two years beginning with the Comp Committee meeting that immediately follows the end of the respective performance period.

Performance stock option unit activity for the six-month period ended September 30, 2016 was:


				Weighted-average
			Weighted-average	remaining		Aggregate
	Number		exercise price	contractual term		intrinsic value
	of shares		per share	(in years)		(in thousands)
Outstanding at March 31, 2016	—	$	—
Granted	633,604	$	21.40
Outstanding at September 30, 2016	633,604	$	21.40	1.6	$	3,326
Exercisable at September 30, 2016	—	$	—	—	$	—

Total expense related to performance stock option units for the six months ended September 30, 2016 was $0.3 million. Future expense for these performance stock option units is expected to be approximately $4.6 million over the next five years.

Stock Appreciation Right (SAR) Activity

SAR activity for the six-month period ended September 30, 2016 was:


				Weighted-average
			Weighted-average	remaining		Aggregate
	Number		exercise price	contractual term		intrinsic value
	of shares		per share	(in years)		(in thousands)
Outstanding at March 31, 2016	245,404	$	40.00
Outstanding at September 30, 2016	245,404	$	40.00	0.5	$	—
Exercisable at September 30, 2016	—	$	—	—	$	—

Total expense related to SARs for the six months ended September 30, 2016 and 2015 was $0.1 million in both periods. Future expense for these SARs is expected to be approximately $0.1 million over the next year.

Restricted Stock Unit Activity

During the six months ended September 30, 2016, the Company granted time-vesting restricted stock units covering 1,257,215 shares of common stock with a value at the date of grant of $27.3 million. Of the restricted stock units granted in the current period, 1,045,041 vest in equal annual increments over four years, 24,160 vest in one year, and 188,014 vest 25% at the one-year anniversary and then over equal quarterly increments during the three subsequent years. Valuation of these units is equal to the quoted market price for the shares on the date of grant.

Non-vested time-vesting restricted stock unit activity for the six-month period ended September 30, 2016 was:


		Weighted average
		fair value per		Weighted-average
	Number	share at grant		remaining contractual
	of shares	date		term (in years)
Outstanding at March 31, 2016	2,279,895	$	19.69	2.12
Granted	1,257,215	$	21.74
Vested	(772,762)	$	20.28
Forfeited or cancelled	(95,560)	$	19.38
Outstanding at September 30, 2016	2,668,788	$	20.50	2.64

During the six months ended September 30, 2016, the Company granted performance-based restricted stock units covering 254,419 shares of common stock with a value at the date of grant of $6.3 million, determined using a Monte Carlo simulation model. All of the performance-based restricted stock units granted in the current period vest subject to attainment of performance criteria established by the Comp Committee. The units granted in the current period may vest in a number of shares from zero to 200% of the award, based on the total shareholder return of Acxiom common stock compared to total shareholder return of a group of peer companies established by the Comp Committee of the board of directors for the period from April 1, 2016 to March 31, 2019.

Non-vested performance-based restricted stock unit activity for the six-month period ended September 30, 2016 was:


		Weighted average
		fair value per		Weighted-average
	Number	share at grant		remaining contractual
	of shares	date		term (in years)
Outstanding at March 31, 2016	516,818	$	18.62	1.67
Granted	254,419	$	24.66
Forfeited or cancelled	(26,142)	$	17.57
Outstanding at September 30, 2016	745,095	$	20.72	1.63

Total expense related to all restricted stock units in the six months ended September 30, 2016 and 2015 was approximately $15.4 million and $8.5 million, respectively. Future expense for these restricted stock units is expected to be approximately $59.1 million over the next four years.

Other Performance Unit Activity

Other performance-based unit activity for the six-month period ended September 30, 2016 was:


		Weighted average
		fair value per		Weighted-average
	Number	share at grant		remaining contractual
	of shares	date		term (in years)
Outstanding at March 31, 2016	635,655	$	4.07	1.30
Outstanding at September 30, 2016	635,655	$	4.07	0.80

Total expense related to other performance units for the six months ended September 30, 2016 and 2015 was $0.5 million and $0.4 million, respectively. Future expense for these performance units is expected to be approximately $0.8 million over the next two years.