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Share-based Compensation | 12 Months Ended
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Jun. 30, 2020
Share-based Payment Arrangement, Noncash Expense [Abstract] |
Share-based Compensation | Share-based Compensation 2018 Omnibus Incentive Plan The 2009 Share Option/Share Issuance Plan (the “2009 Plan”) was approved in September 2009 at the annual general meeting of shareholders in connection with the Company's IPO. At the annual general meeting of shareholders in November 2018, the 2009 Plan was approved to be terminated and the 2018 Omnibus Incentive Plan (the "2018 Plan") was effective. No further awards will be made under the 2009 Plan. The 2018 Plan authorized the board of directors to grant incentive share options, non-statutory share options and restricted shares to employees, directors, non-employee directors and consultants of the Company and its subsidiaries for up to 2,065,000 common shares. The 2018 Plan does not include an evergreen authorization, therefore the Company is not permitted to increase the number of shares reserved in the share pool without obtaining further shareholder approval. Outstanding shares under the 2018 Plan and awards granted under the 2009 Plan that expire, are forfeited or cancelled or terminate prior to the issuance of the shares subject to those awards or are settled in cash will be available for subsequent issuance under the 2018 Plan. As of June 30, 2020, 1,606,154 shares were available for grant under the 2018 Plan. Beginning with the 2014 Annual Shareholders Meeting, on the date of each annual shareholders meeting, each individual who commences service as a non-employee Board member by reason of his or her election to the Board at such annual meeting and each individual who is to continue to serve as a non-employee Board member, whether or not that individual is standing for re-election to the Board at that particular annual meeting, will automatically be granted an award in the form of restricted share units ("RSU") covering that number of common shares determined by dividing ninety-five thousand dollars ($95,000) by the average fair market value per share for the ninety (90)-day period preceding the grant date. Under the 2018 Plan, incentive share options and RSU are to be granted at a price that is not less than 100% and nonstatutory share options are to be granted at not less than 85% of the fair value of the common shares, at the date of grant for employees and consultants. Options and RSUs generally vest over a four-year to five-year period, and are exercisable for a maximum period of ten years after the date of grant. The fair value of RSU, including time-based restricted stock units and performance-based restricted stock units is based on the market price of the Company's share on the date of grant. Time-based Restricted Stock Units ("TRSU") The following table summarizes the Company's TRSU activities:
|  | Number of Restricted Stock Units |  | Weighted Average Grant Date Fair Value Per Share |  | Weighted Average Remaining Recognition Period (Years) |  | Aggregate Intrinsic Value
Nonvested at June 30, 2017 |  | 974,365 |  |  | $ | 13.51 |  |  | 1.68 |  | $ | 16,244,748 |
Granted |  | 482,397 |  |  | $ | 16.46 |  |  |  |  |
Vested |  | (468,051 | ) |  | $ | 13.24 |  |  |  |  |
Forfeited |  | (69,688 | ) |  | $ | 14.25 |  |  |  |  |
Nonvested at June 30, 2018 |  | 919,023 |  |  | $ | 15.14 |  |  | 1.62 |  | $ | 13,086,888 |
Granted |  | 527,022 |  |  | $ | 11.28 |  |  |  |  |
Vested |  | (499,954 | ) |  | $ | 13.09 |  |  |  |  |
Forfeited |  | (39,750 | ) |  | $ | 13.82 |  |  |  |  |
Nonvested at June 30, 2019 |  | 906,341 |  |  | $ | 14.09 |  |  | 1.62 |  | $ | 8,465,225 |
Granted |  | 505,440 |  |  | $ | 8.51 |  |  |  |  |
Vested |  | (455,893 | ) |  | $ | 13.53 |  |  |  |  |
Forfeited |  | (23,750 | ) |  | $ | 13.19 |  |  |  |  |
Nonvested at June 30, 2020 |  | 932,138 |  |  | $ | 11.36 |  |  | 1.66 |  | 10,141,661 |
Performance-based Restricted Stock Units ("PRSU") In March each year since year 2017, the Company granted PRSU to certain personnel. The number of shares to be ultimately earned under the PRSU is determined based on the level of attainment of predetermined financial goals. The PRSU vests in four equal annual installments from the first anniversary date after the grant date if certain predetermined financial goals were met. The Company recorded approximately $1.5 million, $2.8 million and $1.9 million of expenses for these PRSUs during the years ended June 30, 2020, 2019 and 2018, respectively. During the quarter ended June 30, 2019, the Company announced an incentive program. Under this program, each participant’s award is denominated in stock and subject to achievement of certain objective goals within certain timelines. In June 2020, the Company believed it was most likely that predetermined goal measures would be met. The Company recorded $0.6 million of non-cash compensation expense for these awards in the quarter ended June 30, 2020. The expense was reported in the other current liabilities line on the consolidated balance sheet as the total amount of bonus is to be settled in variable number of RSU’s at the completion of the objective goals. Such non-cash compensation expense was recorded as part of stock compensation expense in the consolidated statements of operations. The following table summarizes the Company's PRSU activities:
|  | Number of Performance-based Restricted Stock Units |  | Weighted Average Grant Date Fair Value Per Share |  | Weighted Average Remaining Recognition Period (Years) |  | Aggregate Intrinsic Value
Nonvested at June 30, 2017 |  | 170,000 |  |  | $ | 17.58 |  |  | 2.21 |  | $ | 2,833,900 |
Granted |  | 298,050 |  |  | $ | 16.22 |  |  |  |  |
Vested |  | (38,247 | ) |  | $ | 17.58 |  |  |  |  |
Forfeited |  | (7,503 | ) |  | $ | 17.26 |  |  |  |  |
Nonvested at June 30, 2018 |  | 422,300 |  |  | $ | 16.63 |  |  | 2.06 |  | $ | 6,013,552 |
Granted |  | 291,750 |  |  | $ | 11.18 |  |  |  |  |
Vested |  | (111,623 | ) |  | $ | 16.68 |  |  |  |  |
Forfeited |  | (5,703 | ) |  | $ | 16.78 |  |  |  |  |
Nonvested at June 30, 2019 |  | 596,724 |  |  | $ | 13.95 |  |  | 1.88 |  | $ | 5,573,402 |
Granted |  | 155,000 |  |  | $ | 7.36 |  |  |  |  |
Vested |  | (110,659 | ) |  | $ | 16.68 |  |  |  |  |
Forfeited |  | (298,290 | ) |  | $ | 11.32 |  |  |  |  |
Nonvested at June 30, 2020 |  | 342,775 |  |  | $ | 12.38 |  |  | 1.60 |  | 3,729,392 |
Market-based Restricted Stock Units ("MSUs") During the quarter ended September 30, 2018, the Company granted 1.3 million market-based restricted stock units ("MSUs") to certain personnel. The number of shares to be earned at the end of the performance period is determined based on the Company’s achievement of specified stock prices and revenue thresholds during the performance period from January 1, 2019 to December 31, 2021 as well as the recipients remaining in continuous service with the Company through such period. The MSUs vest in four equal annual installments after the end of performance period. The Company estimated the grant date fair values of its MSUs with derived service periods of 4.5 to 7.5 years using a Monte-Carlo simulation model with the following assumptions: Risk-free interest rate of 2.7%, expected term of 3.5 years, expected volatility of 38.8% and dividend yield of 0%. The Company recorded approximately $0.6 million and $0.4 million of expense for these MSUs during the years ended June 30, 2020 and 2019, respectively. Subsequent to June 30, 2020, the Company's Board of Directors approved the modification of the performance period of the MSU. See Note 14. Stock Option The following table summarizes the Company's stock option activities:
|  |  |  |  | Weighted |  |
|  |  | Weighted |  | Average |  |
|  |  | Average |  | Remaining |  |
| Number of |  | Exercise Price |  | Contractual |  | Aggregate
| Shares |  | Per Share |  | Term (in years) |  | Intrinsic Value
Outstanding at June 30, 2017 | 1,053,367 |  |  | $ | 10.98 |  |  | 4.43 |  |  |
Granted | — |  |  | $ | — |  |  |  |  |
Exercised | (166,389 | ) |  | $ | 11.00 |  |  |  |  | $ | 959,257 |
Canceled or forfeited | — |  |  | $ | — |  |  |  |  |
Outstanding at June 30, 2018 | 886,978 |  |  | $ | 10.97 |  |  | 4.03 |  |
Granted | — |  |  | $ | — |  |  |  |  |
Exercised | (10,500 | ) |  | $ | 10.50 |  |  |  |  | $ | 43,415 |
Canceled or forfeited | — |  |  | $ | — |  |  |  |  |
Outstanding at June 30, 2019 | 876,478 |  |  | $ | 10.98 |  |  | 3.06 |  |  |
Granted | — |  |  | $ | — |  |  |  |  |
Exercised | (2,500 | ) |  | $ | 10.50 |  |  |  |  | $ | 4,726 |
Canceled or forfeited | (230,000 | ) |  | $ | 17.11 |  |  |  |  |
Outstanding at June 30, 2020 | 643,978 |  |  | $ | 8.79 |  |  | 2.89 |  | $ | 1,544,664 |
Options vested and expected to vest | 643,978 |  |  | $ | 8.79 |  |  | 2.89 |  | $ | 1,544,664 |
Exercisable at June 30, 2020 | 643,978 |  |  | $ | 8.79 |  |  | 2.89 |  | $ | 1,544,664 |
The aggregate intrinsic value for options outstanding at June 30, 2020 in the table above is based on the Company’s common stock closing price on June 30, 2020. Information with respect to stock options outstanding and exercisable as of June 30, 2020 is as follows:
|  | Options Outstanding |  | Options Exercisable
Range of Exercise Prices |  | Number Outstanding |  | Weighted-Average Remaining Contractual Life (Years) |  | Weighted-Average Exercise Price |  | Number Exercisable |  | Weighted-Average Exercise Price
$7.21 - $7.21 |  | 6,875 |  |  | 3.58 |  | $ | 7.21 |  |  | 6,875 |  |  | $ | 7.21 |
$7.44 - $7.44 |  | 331,139 |  |  | 3.71 |  | $ | 7.44 |  |  | 331,139 |  |  | $ | 7.44 |
$7.56 - $9.19 |  | 132,150 |  |  | 3.14 |  | $ | 8.47 |  |  | 132,150 |  |  | $ | 8.47 |
$9.90 - $12.68 |  | 168,000 |  |  | 1.11 |  | $ | 11.64 |  |  | 168,000 |  |  | $ | 11.64 |
$12.91 - $12.91 |  | 5,814 |  |  | 0.79 |  | $ | 12.91 |  |  | 5,814 |  |  | $ | 12.91 |
$7.21 - $12.91 |  | 643,978 |  |  | 2.89 |  | $ | 8.79 |  |  | 643,978 |  |  | $ | 8.79 |
The 2018 Employee Share Purchase Plan At the annual general meeting of shareholders in November 2018, the 2018 Employee Share Purchase Plan ("Purchase Plan" or "ESPP") Plan was approved, under which 1,430,000 common shares are available for issuance. The ESPP Plan does not include an evergreen authorization, therefore the Company is not permitted to increase the number of shares reserved in the share pool without obtaining further shareholder approval. The Purchase Plan provided for a series of overlapping offering periods with a duration of 24 months, generally beginning on May 15 and November 15 of each year. The Purchase Plan allows employees to purchase common shares through payroll deductions of up to 15% of their eligible compensation. Such deductions will accumulate over a six-month accumulation period without interest. After such accumulation period, common shares will be purchased at a price equal to 85% of the fair market value per share on either the first day of the offering period or the last date of the accumulation period, whichever is less. The maximum number of shares that may be purchased by a participant on any purchase date may not exceed 875 shares for a total of 3,500 shares per a 24-month offering period. In addition, no participant may purchase more than $25,000 worth of common stock in any one calendar year period. No more than 200,000 common shares may be purchased by all participants on any purchase date. The ESPP is compensatory and results in compensation expense. The fair values of common shares to be issued under the ESPP were determined using the Black-Scholes option pricing model with the following assumptions:
| Year Ended June 30,
| 2020 |  | 2019 |  | 2018
Volatility rate | 46.4% - 58.3% |  | 40.1% - 40.7% |  | 42.1% - 45.3%
Risk-free interest rate | 0.2% - 1.6% |  | 2.1% - 2.9% |  | 1.4% - 2.6%
Expected term | 1.3 years |  | 1.3 years |  | 1.3 years
Dividend yield | —% |  | —% |  | —%
The weighted-average estimated fair value of employee stock purchase rights granted pursuant to the ESPP during the years ended June 30, 2020, 2019 and 2018 was $4.33, $3.84 and $5.81 per share, respectively. Share-based Compensation Expenses The total share-based compensation expense related to TRSU, PSUs, MSUs, stock options and ESPP described above, recognized in the consolidated statements of operations for the years presented was as follows:
| Year Ended June 30,
| 2020 |  | 2019 |  | 2018
| (in thousands)
Cost of goods sold | $ | 1,530 |  |  | $ | 1,963 |  |  | $ | 1,641 |
Research and development | 2,895 |  |  | 2,453 |  |  | 1,855 |
Selling, general and administrative | 6,029 |  |  | 8,761 |  |  | 7,916 |
| $ | 10,454 |  |  | $ | 13,177 |  |  | $ | 11,412 |
Total unrecognized share-based compensation expense as of June 30, 2020 was $10.7 million including estimated forfeitures, which is expected to be recognized over a weighted-average period of 1.8 years.

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