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Stockholders' Equity
 3 Months Ended
Sep. 30, 2015
Stockholders' Equity  
Stockholders' Equity

 

5. Stockholders’ Equity

 

Stock-based Compensation

 

As of September 30, 2015, the Company maintained two share-based employee compensation plans (the “OSI Plans”): the 2012 Incentive Award Plan (“2012 Plan”) and the Amended and Restated 2006 Equity Participation Plan (“2006 Plan”).  Upon stockholder approval of the 2012 Plan, the Company ceased to make grants under the 2006 Plan.

 

The Company recorded stock-based compensation expense in the condensed consolidated statements of operations as follows (in thousands):

 

 

 

Three Months Ended September 30,

 

 

 

2014

 

2015

 

Cost of goods sold

 

$
205 

 

$
292 

 

Selling, general and administrative

 
5,763 

 
4,108 

 

Research and development

 
27 

 
65 

 

 

 

 

 

 

 

Stock based compensation expense

 
5,995 

 
4,465 

 

Less: Related income tax benefit

 
2,406 

 
1,699 

 

 

 

 

 

 

 

Stock based compensation expense, net

 

$
3,589 

 

$
2,766 

 

 

 

 

 

 

 

 

 

 

As of September 30, 2015, total unrecognized compensation cost related to share-based compensation grants were estimated at $1.3 million for stock options and $26.9 million for restricted stock and restricted stock units (“RSUs”) under the OSI Plans.  The Company expects to recognize these costs over a weighted-average period of 1.9 years.

 

The following summarizes stock option activity during the three months ended September 30, 2015:

 

 

 

 

 

Weighted Average

 

Weighted-Average

 

Aggregate

 

 

 

Number of

 

Exercise

 

Remaining Contractual

 

Intrinsic Value

 

 

 

Options

 

Price

 

Term

 

(in thousands)

 

Outstanding at June 30, 2015

 
1,012,650

 

$
27.30

 

 

 

 

 

Granted

 
33,088

 

$
74.48

 

 

 

 

 

Exercised

 
(57,731

)

$
27.03

 

 

 

 

 

Expired or forfeited

 
(3,087

)

$
63.48

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Outstanding at September 30, 2015

 
984,920

 

$
28.79

 

4.7 years

 

$
47,444

 

 

 

 

 

 

 

 

 

 

 

 

 

Exercisable at September 30, 2015

 
904,813

 

$
25.39

 

4.3 years

 

$
46,662

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The following summarizes restricted stock and RSU award activity during the three months ended September 30, 2015:

 

 

 

 

 

Weighted-

 

 

 

 

 

Average

 

 

 

Shares

 

Fair Value

 

Nonvested at June 30, 2015

 
659,906

 

$
63.75

 

Granted

 
329,185

 

$
73.15

 

Vested

 
(378,470

)

$
65.49

 

Forfeited

 
(41,707

)

$
67.62

 

 

 

 

 

 

 

 

Nonvested at September 30, 2015

 
568,914

 

$
67.75

 

 

 

 

 

 

 

 

 

As of September 30, 2015, there were 2,778,349 shares available for grant under the 2012 Plan.  Under the terms of that plan, restricted stock and RSUs granted from the pool of shares available for grant on or after December 12, 2012 reduce the pool by 1.87 shares for each award granted.  Restricted stock and RSUs forfeited and returned to the pool of shares available for grant increase the pool by 1.87 shares for each award forfeited.

 

The Company granted 151,469 and 139,300 performance-based RSUs during the three months ended September 30, 2014 and 2015, respectively. These performance-based RSUs are contingent on the achievement of certain financial performance metrics. The payout can range from zero to 250% of the original number of shares or units awarded.

 

Share Repurchase Program

 

In March 1999, the Board of Directors authorized a stock repurchase program of up to 2 million shares. In both September 2004 and April 2013, the Board of Directors authorized an additional 1 million shares for repurchase pursuant to this program.  As of September 30, 2015, there were 479,764 of available shares that may be repurchased under this program. In October 2015, the Board of Directors authorized an additional 500,000 shares for repurchase pursuant to this program. This program does not have an expiration date. Upon repurchase, the shares are restored to the status of authorized but unissued, and we record them as a reduction in the number of shares of common stock issued and outstanding in the consolidated financial statements.