XML 30 R20.htm IDEA: XBRL DOCUMENT
v3.23.1

Share-Based Compensation | 9 Months Ended
--- | ---
Mar. 25, 2023
Share-Based Payment Arrangement [Abstract] |
Share-Based Compensation | 13. Share-Based Compensation Share-Based Compensation Plans On October 29, 2019, our stockholders approved: (i) our 2019 Equity and Incentive Compensation Plan, or the 2019 Incentive Plan, to replace our Amended and Restated 2010 Incentive Compensation Plan, or the 2010 Incentive Plan, and (ii) our 2019 Employee Stock Purchase Plan, or the 2019 ESPP, to replace our Amended and Restated 2010 Employee Stock Purchase Plan. Awards outstanding at October 29, 2019 under our prior share-based compensation plans were not impacted by the approval of the 2019 Incentive Plan and continue to remain outstanding and vest by their terms under the applicable share-based compensation plan. Shares underlying certain share-based awards forfeited under the 2010 Incentive Plan subsequent to the approval of the 2019 Incentive Plan automatically transfer to and become available for award issuance from the 2019 Incentive Plan. The 2019 Incentive Plan authorizes our Board of Directors to provide equity-based compensation in the form of stock options, stock appreciation rights, restricted stock, RSUs, cash incentive awards, performance shares, PSUs, and other stock-based awards. The 2019 Incentive Plan has been amended and restated, and t he cumulative number of shares approved by stockholders is 5,288,000 as of October 25, 2022. The 2019 ESPP authorizes the Company to provide eligible employees with an opportunity to acquire an equity interest in the Company through the purchase of stock at a discount, with an initial authorization of 1,500,000 shares. Effective August 19, 2019, we adopted the 2019 Inducement Equity Plan, and 650,000 shares of our common stock were reserved for issuance under the 2019 Inducement Equity Plan, subject to adjustment for stock dividends, stock splits, or other changes in our common stock or capital structure. The 2019 Inducement Equity Plan was intended to comply with Rule 5635(c)(4) of the Nasdaq Stock Market Listing Rules, which provide an exception to the Nasdaq Stock Market Listing Rules on the shareholder approval requirement for the issuance of securities with regards to grants to employees of the Company or its subsidiaries as an inducement material to such individuals entering into employment with the Company or its subsidiaries. An individual was eligible to receive an award under the 2019 Inducement Equity Plan only if he or she was not previously an employee or director of our Company (or is returning to work after a bona-fide period of non-employment), and an award under the 2019 Inducement Equity Plan is a material inducement for him or her to accept employment with our Company. No new awards may be granted under the 2019 Inducement Equity Plan. Share-Based Compensation Share-based compensation and the related tax benefit recognized in our condensed consolidated statements of income were as follows (in millions):
|  | Three Months Ended |  |  | Nine Months Ended |
|  | March |  |  | March |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Cost of revenue |  | $ | 0.9 |  |  | $ | 0.9 |  |  | $ | 3.0 |  |  | $ | 3.2 |
Research and development |  |  | 12.1 |  |  |  | 18.0 |  |  |  | 39.5 |  |  |  | 57.4 |
Selling, general, and administrative |  |  | 16.8 |  |  |  | 15.2 |  |  |  | 49.9 |  |  |  | 45.7 |
Total |  | $ | 29.8 |  |  | $ | 34.1 |  |  | $ | 92.4 |  |  | $ | 106.3 |
Income tax benefit on share-based compensation |  | $ | (2.8 | ) |  | $ | (3.4 | ) |  | $ | (10.7 | ) |  | $ | (20.1 | )
Included in the preceding table is share-based compensation for our cash-settled phantom stock units, which we granted in October 2019 (see Phantom Stock Units below) (in millions):
|  | Three Months Ended |  |  | Nine Months Ended |
|  | March |  |  | March |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Cost of revenue |  | $ | - |  |  | $ | 0.1 |  |  | $ | 0.1 |  |  | $ | 0.2 |
Research and development |  |  | - |  |  |  | 6.4 |  |  |  | 0.3 |  |  |  | 26.7 |
Selling, general, and administrative |  |  | - |  |  |  | 1.4 |  |  |  | 0.3 |  |  |  | 5.6 |
Total |  | $ | - |  |  | $ | 7.9 |  |  | $ | 0.7 |  |  | $ | 32.5 |
Historically, we have issued new shares in connection with our equity-settled share-based compensation plans, however, treasury shares are also available for issuance. Any additional shares repurchased under our common stock repurchase program will be available for issuance under our share-based compensation plans. Share-Based Compensation Plan Activity Stock Options Stock option activity was as follows:
|  | Stock |  |  | Weighted |  |  | Aggregate |
|  | Option |  |  | Average |  |  | Intrinsic |
|  | Awards |  |  | Exercise |  |  | Value |
|  | Outstanding |  |  | Price |  |  | (in millions) |
Balance as of June 2022 |  |  | 31,185 |  |  | $ | 61.51 |  |  |  |
Exercised |  |  | (27,359 | ) |  | $ | 62.17 |  |  |  |
Expired |  |  | (557 | ) |  | $ | 81.89 |  |  |  |
Balance as of March 2023 |  |  | 3,269 |  |  | $ | 52.50 |  |  | $ | 183.6 |
The aggregate intrinsic value was determined using the closing price of our common stock on March 24, 2023 of $108.65. Restricted Stock Units RSUs granted generally vest ratably over three to four years from the vesting commencement date. RSU activity was as follows:
|  |  |  |  | Aggregate |
|  | RSU |  |  | Intrinsic |
|  | Awards |  |  | Value |
|  | Outstanding |  |  | (in millions) |
Balance as of June 2022 |  |  | 1,220,573 |  |  |  |
Granted |  |  | 769,320 |  |  |  |
Delivered |  |  | (561,484 | ) |  |  |
Forfeited |  |  | (73,625 | ) |  |  |
Balance as of March 2023 |  |  | 1,354,784 |  |  | $ | 147.2 |
The aggregate intrinsic value was determined using the closing price of our common stock on March 24, 2023 of $108.65. On the delivery date, we withhold shares to cover statutory tax withholding requirements and deliver a net quantity of shares to the recipient after such withholding. Until delivery of shares, the grantee has no rights as a stockholder with respect to any shares underlying the RSU award. Of the shares delivered, 164,864 shares valued at $19.9 million were withheld to meet statutory tax withholding requirements. Market Stock Units An MSU is a promise to deliver shares of our common stock at a future date based on the achievement of market-based performance requirements in accordance with the terms of the MSU grant agreement. MSU activity was as follows:
|  |  |  |  | Aggregate |
|  | MSU |  |  | Intrinsic |
|  | Awards |  |  | Value |
|  | Outstanding |  |  | (in millions) |
Balance as of June 2022 |  |  | 251,974 |  |  |  |
Granted |  |  | 279,681 |  |  |  |
Delivered |  |  | (304,334 | ) |  |  |
Balance as of March 2023 |  |  | 227,321 |  |  | $ | 24.7 |
The aggregate intrinsic value was determined using the closing price of our common stock on March 24, 2023 of $108.65. On the delivery date, we withhold shares to cover statutory tax withholding requirements and deliver a net quantity of shares to the recipient after such withholding. Until delivery of shares, the grantee has no rights as a stockholder with respect to any shares underlying the MSU award. Of the shares delivered, 159,379 shares valued at $18.5 million were withheld to meet statutory tax withholding requirements. We value MSUs using the Monte Carlo simulation model on the date of grant and amortize the compensation expense over the three- or four-year performance and service period on a ratable basis by tranche. The unrecognized share-based compensation cost of our outstanding MSUs was approximately $29.3 million as of March 2023, which will be recognized over a weighted average period of approximately 1.0 years. Performance Stock Units A PSU is a promise to deliver shares of our common stock at a future date based on the achievement of performance-based requirements in accordance with the terms of the PSU grant agreement. PSU activity was as follows:
|  |  |  |  | Aggregate |
|  | PSU |  |  | Intrinsic |
|  | Awards |  |  | Value |
|  | Outstanding |  |  | (in millions) |
Balance as of June 2022 |  |  | 257,903 |  |  |  |
Awarded |  |  | 279,095 |  |  |  |
Released |  |  | (264,964 | ) |  |  |
Forfeited |  |  | (7,355 | ) |  |  |
Balance as of March 2023 |  |  | 264,679 |  |  | $ | 28.8 |
The aggregate intrinsic value was determined using the closing price of our common stock on March 24, 2023 of $108.65. On the delivery date, we withhold shares to cover statutory tax withholding requirements and deliver a net quantity of shares to the recipient after such withholding. Until delivery of shares, the grantee has no rights as a stockholder with respect to any shares underlying the PSU award. Of the shares delivered, 122,133 shares valued at $13.8 million were withheld to meet statutory tax withholding requirements. We value PSUs using the aggregate intrinsic value on the date of grant adjusted for estimated performance achievement during the performance period and amortize the compensation expense over the three-year service period on a ratable basis. The unrecognized share-based compensation cost of our outstanding PSUs was approximately $35.2 million as of March 2023, which will be recognized over a weighted average period of approximately 0.9 years. Phantom Stock Units We initially granted phantom stock units to certain non-officer employees in October 2019 and there have been no subsequent phantom stock unit grants. Phantom stock units are cash-settled and entitle the recipient to receive a cash payment equal to the value of a single share for each unit based on the average closing share price of our stock over the thirty calendar days prior to the vesting date. The final vesting occurred on October 31, 2022, and no phantom stock units remain outstanding under this plan. Phantom stock activity was as follows:
|  | Phantom |  |
|  | Stock Units |  |
|  | Outstanding |  |
Balance as of June 2022 |  |  | 176,097 |  |
Paid |  |  | (173,436 | ) |
Forfeited |  |  | (2,661 | ) |
Balance as of March 2023 |  |  | - |  |
Employee Stock Purchase Plan Shares purchased, weighted average purchase price, cash received, and the aggregate intrinsic value for employee stock purchase plan purchases during the nine months ended March 2023, were as follows (in millions, except for shares purchased and weighted average price):
Shares purchased |  |  | 172,044 |
Weighted average purchase price |  | $ | 91.87 |
Cash received |  | $ | 15.8 |
Aggregate intrinsic value |  | $ | 2.8 |

X
- Definition The entire disclosure for share-based payment arrangement. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=128089324&loc=d3e5070-113901 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -URI https://asc.fasb.org/topic&trid=2228938 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (l) -URI https://asc.fasb.org/extlink&oid=128089324&loc=d3e5070-113901 Reference 4: http://www.xbrl.org/2003/role/exampleRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (a)(1) -URI https://asc.fasb.org/extlink&oid=128089324&loc=d3e5070-113901 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (h)(2)(i) -URI https://asc.fasb.org/extlink&oid=128089324&loc=d3e5070-113901 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (h)(2) -URI https://asc.fasb.org/extlink&oid=128089324&loc=d3e5070-113901 + Details
Name: | us-gaap_DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_DisclosureOfCompensationRelatedCostsSharebasedPaymentsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration