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Stockholders' Equity
 9 Months Ended
Mar. 31, 2017
Stockholders' Equity  
Stockholders' Equity

 

7. Stockholders’ Equity

 

Stock-based Compensation

 

As of March 31, 2017, the Company maintained the following share-based employee compensation 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. In addition, pursuant to the acquisition of AS&E, the Company assumed two share-based employee compensation plans: the AS&E 2005 Equity and Incentive Plan (“2005 AS&E Plan”) and the AS&E 2014 Equity and Incentive Plan (“2014 AS&E Plan”). No new RSU grants will be made under the 2005 AS&E Plan or the 2014 AS&E Plan. The 2012 Plan, the 2006 Plan, the 2005 AS&E Plan and the 2014 AS&E Plan are collectively referred to as the “OSI Plans”.

 

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

 

 

 

Three Months Ended
March 31,

 

Nine Months Ended
March 31,

 

 

 

2016

 

2017

 

2016

 

2017

 

Cost of goods sold

 

$
302

 

$
417

 

$
899

 

$
1,116

 

Selling, general and administrative

 
4,456

 
5,627

 
12,475

 
15,909

 

Research and development

 
70

 
159

 
208

 
335

 

Restructuring

 

—

 

—

 

—

 
2,902

 

 

 

 

 

 

 

 

 

 

 

Stock-based compensation expense before taxes

 

$
4,828

 

$
6,203

 

$
13,582

 

$
20,262

 

Less: related income tax benefit

 
(1,850

)
(2,378

)
(5,184

)
(7,828

)

 

 

 

 

 

 

 

 

 

 

Stock-based compensation expense, net of estimated taxes

 

$
2,978

 

$
3,825

 

$
8,398

 

$
12,434

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of March 31, 2017, total unrecognized compensation cost related to share-based compensation grants were estimated at $0.7 million for stock options and $20.3 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 nine months ended March 31, 2017:

 

 

 

Number of
Options

 

Weighted-
Average
Exercise
Price

 

Weighted-Average
Remaining Contractual
Term

 

Aggregate
Intrinsic Value
(in thousands)

 

Outstanding at June 30, 2016

 
934,112

 

$
28.67

 

 

 

 

 

Granted

 
17,344

 

$
73.69

 

 

 

 

 

Exercised

 
(159,278

)

$
24.88

 

 

 

 

 

Expired or forfeited

 
(3,725

)

$
68.91

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Outstanding at March 31, 2017

 
788,453

 

$
30.24

 

3.6 years

 

$
33,775

 

 

 

 

 

 

 

 

 

 

 

 

 

Exercisable at March 31, 2017

 
739,020

 

$
27.44

 

3.2 years

 

$
33,678

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The following summarizes restricted stock and RSU award activity during the nine months ended March 31, 2017:

 

 

 

Shares

 

Weighted-
Average
Fair Value

 

Nonvested at June 30, 2016

 
530,498

 

$
67.94

 

Granted

 
377,610

 
64.50

 

Vested

 
(294,893

)
68.05

 

Net replacement RSUs (1)

 
24,606

 
67.76

 

Forfeited

 
(19,065

)
68.24

 

 

 

 

 

 

 

Nonvested at March 31, 2017

 
618,756

 

$
65.77

 

 

 

 

 

 

 

 

 

(1)

Pursuant to the acquisition of AS&E, the Company assumed unvested RSUs originally granted by AS&E and converted them into RSUs for the Company’s common stock.

 

As of March 31, 2017, there were approximately 1.3 million shares available for grant under the 2012 Plan.  Under the terms of the 2012 Plan, RSUs and restricted stock granted from the pool of shares available for grant reduce the pool by 1.87 shares for each award granted. RSUs and restricted stock 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 139,300 and 155,488 performance-based RSUs during the nine months ended March 31, 2016 and 2017, respectively. These performance-based RSUs are contingent on the achievement of certain performance metrics. The payout can range from zero to 250% of the original number of shares or units awarded.

 

Share Repurchase Program

 

In April 2016, the Board of Directors authorized a stock repurchase program totaling 1.0 million shares.  During the three months ended March 31, 2017, 82,640 shares were repurchased under this program, which leaves available 872,481shares under this program. This program does not expire. Upon repurchase, the shares are restored to the status of authorized but unissued, and the Company records them as a reduction in the number of shares of common stock issued and outstanding in the consolidated financial statements.