EQUITY INCENTIVE PLANS

Share-Based Compensation Expense

The following table presents the details of the Company's share-based compensation expense (amounts in thousands):



	Year Ended March 31,
	2016			2015			2014
Cost of sales	$	8,252	⁽¹⁾	$	9,010	⁽¹⁾	$	7,340	⁽¹⁾
Research and development	32,022			28,164			24,554
Selling, general and administrative	31,146			21,422			21,893
Pre-tax effect of share-based compensation	71,420			58,596			53,787
Income tax benefit	23,012			10,640			5,722
Net income effect of share-based compensation	$	48,408		$	47,956		$	48,065

⁽¹⁾ During the year ended March 31, 2016, $7.9 million of share-based compensation expense was capitalized to inventory, and $8.3 million of previously capitalized share-based compensation expense in inventory was sold. During the year ended March 31, 2015, $6.8 million of share-based compensation expense was capitalized to inventory, and $9.0 million of previously capitalized share-based compensation expense in inventory was sold. During the year ended March 31, 2014, $7.4 million of share-based compensation expense was capitalized to inventory, and $7.3 million of previously capitalized share-based compensation expense in inventory was sold.

The amount of unearned share-based compensation currently estimated to be expensed in the remainder of fiscal 2017 through fiscal 2021 related to unvested share-based payment awards at March 31, 2016 is $134.5 million. The weighted average period over which the unearned share-based compensation is expected to be recognized is approximately 2.30 years.

Combined Incentive Plan Information

RSU share activity under the 2004 Plan is set forth below:



	Number of Shares
Nonvested shares at April 1, 2013	6,009,831
Granted	1,616,632
Forfeited/expired	(282,964	)
Vested	(1,813,465	)
Nonvested shares at March 31, 2014	5,530,034
Granted	1,446,968
Forfeited/expired	(266,415	)
Vested	(1,441,671	)
Nonvested shares at March 31, 2015	5,268,916
Granted	2,479,729
Assumed upon acquisition	525,442
Forfeited/expired	(360,072	)
Vested	(1,606,273	)
Nonvested shares at March 31, 2016	6,307,742

The total intrinsic value of RSUs which vested during the years ended March 31, 2016, 2015 and 2014 was $72.1 million, $67.6 million and $74.6 million, respectively. The aggregate intrinsic value of RSUs outstanding at March 31, 2016 was $304.0 million, calculated based on the closing price of the Company's common stock of $48.20 per share on March 31, 2016. At March 31, 2016, the weighted average remaining expense recognition period was 2.35 years.

The weighted average fair value per share of the RSUs awarded is calculated based on the fair market value of the Company's common stock on the respective grant dates discounted for the Company's expected dividend yield. The weighted average fair value per share of RSUs awarded in fiscal 2016, 2015 and 2014 was $38.92, $42.02 and $34.24, respectively.

Stock option and stock appreciation right (SAR) activity under the Company's stock incentive plans in the three years ended March 31, 2016 is set forth below:



	Number of Shares		Weighted Average Exercise Price per Share
Outstanding at April 1, 2013	2,269,803		$	25.58
Granted	—		—
Exercised	(1,675,663	)	25.91
Canceled	(20,529	)	22.78
Outstanding at March 31, 2014	573,611		24.75
Granted	27,654		46.66
Assumed upon acquisition	666,586		29.33
Exercised	(477,618	)	26.42
Canceled	(105,934	)	28.17
Outstanding at March 31, 2015	684,299		28.41
Granted	244		41.09
Assumed upon acquisition	604,900		35.03
Exercised	(221,987	)	25.30
Canceled	(153,948	)	31.52
Outstanding at March 31, 2016	913,508		$	33.00

The total intrinsic value of options and SARs exercised during the years ended March 31, 2016, 2015 and 2014 was $4.7 million, $9.6 million and $25.5 million, respectively. This intrinsic value represents the difference between the fair market value of the Company's common stock on the date of exercise and the exercise price of each equity award.

The aggregate intrinsic value of options and SARs outstanding at March 31, 2016 was $13.9 million. The aggregate intrinsic value of options and SARS exercisable at March 31, 2016 was $8.8 million. The aggregate intrinsic values were calculated based on the closing price of the Company's common stock of $48.20 per share on March 31, 2016.

As of March 31, 2016 and 2015, the number of option and SAR shares exercisable was 553,844 and 283,133, respectively, and the weighted average exercise price per share was $32.33 and $26.90, respectively.

The weighted average fair values per share of stock options granted in the years ended March 31, 2016 and 2015 was $8.85 and $9.00, respectively. The fair values per share of stock options granted in the years ended March 31, 2016 and 2015 were estimated utilizing the following assumptions:



	Year Ended March 31,
	2016		2015
Expected term (in years)	6.5		6.5
Volatility	29.50	%	26.65	%
Risk-free interest rate	1.54	%	1.59	%
Dividend yield	3.00	%	3.00	%

There were no stock options granted in the year ended March 31, 2014.