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STOCK BASED COMPENSATION
 3 Months Ended
Sep. 30, 2012
STOCK BASED COMPENSATION

NOTE 12—STOCK BASED COMPENSATION

Stock-Based Compensation Plans

The Company’s 2010 Equity Incentive Plan and 2005 Equity Incentive Plan are described in its Annual Report. As of September 30, 2012, the Company had 1,414,579 authorized shares available for future issuance under all of its stock incentive plans.

Employee Stock-based Compensation

The following table shows total stock-based compensation expense included in the Condensed Consolidated Statements of Operations for the months ended September 30, 2012 and 2011 (in thousands):

 

     Three Months Ended September 30,  
     2012      2011  

Cost of sales

    $ 81       $ 6   

Research and development

      266         116   

Sales, general and administrative

      309         229   
  

 

 

     

 

 

  
   $ 656       $ 351   
  

 

 

     

 

 

  

Stock Options

The following is a summary of option activity for the Company’s stock incentive plans for the three months ended September 30, 2012:

 

     Common Stock Options Outstanding  
     Number
of Shares		     Weighted
Average
Exercise
Price		      Weighted
Average
Remaining
Contractual
Life (Years)		      Aggregate
Intrinsic
Value		  
                         (In thousands)  

Balance, June 30, 2012

      3,347,445        1.45         

Granted

      —          —           

Exercised

      (29,705 )      3.42         

Forfeitures and cancellations

      (11,803 )      5.53         
  

 

 

          

Balance, September 30, 2012

      3,305,937      $ 1.42         6.34       $ 34,809   
  

 

 

    

 

 

     

 

 

     

 

 

  

Vested and expected to vest as of September 30, 2012

      3,274,056      $ 1.39         6.32       $ 34,570   
  

 

 

    

 

 

     

 

 

     

 

 

  

Vested and exercisable as of September 30, 2012

      2,563,713      $ 0.63         5.83       $ 28,903   
  

 

 

    

 

 

     

 

 

     

 

 

  

During the three months ended September 30, 2012 and 2011, the aggregate intrinsic value of options exercised under the Company’s stock incentive plans was $178,000 and $397,000, respectively, as determined as of the date of option exercise.

 

As of September 30, 2012, the Company had unrecognized compensation costs of $1.6 million related to stock options which the Company expects to recognize over a weighted-average period of 2.4 years. Future option grants will increase the amount of compensation expense to be recorded in these periods.

The Company estimates the fair value of employee stock options using the Black-Scholes option pricing model. The fair value of employee stock options is being amortized on a straight-line basis over the requisite service period of the awards. The Company did not grant any employee stock options during the three months ended September 30, 2012. For the three months ended September 30, 2011, the fair value of employee stock options was estimated using the following weighted average assumptions:

 

     Three Months Ended
September 30, 2011		  
    

Expected term

      6.1 years   

Expected volatility

      49 % 

Risk-free interest rate

      1.8 % 

Expected dividend yield

      —     

Weighted average grant date fair value

    $ 4.03   

 

Restricted Stock Units (“RSUs”)

The following table summarizes the activity of the RSUs made by the Company:

 

     Number of
Shares		     Weighted
Average Grant
Date Fair Value		  

Non-vested RSUs, June 30, 2012

      453,620      $ 9.42   

RSUs granted

      257,500        13.86   

RSUs vested

      (7,290 )     12.14   

RSUs cancelled

      (10,000 )     28.78   
  

 

 

    

Non-vested RSUs, September 30, 2012

      693,830      $ 10.76   
  

 

 

    

 

 

  

The intrinsic value of RSUs vested in the three months ended September 30, 2012 and 2011 was $91,000 and $25,000, respectively. The total intrinsic value of all outstanding RSUs was $8.3 million as of September 30, 2012.

As of September 30, 2012, there was unrecognized compensation costs related to RSUs of $6.2 million which the Company expects to recognize over a weighted average period of 3.8 years.