Stock-Based Compensation

STOCK OPTION PLANS

The number of shares authorized for issuance under the Company’s 2005 Stock Incentive Plan, as amended and restated (the “2005 Plan”), is 15,252 shares at June 30, 2017. As reflected in the Company's registration statement on Form S-8 filed on February 4, 2016, the Company's number of shares authorized for issuance under the 2005 Plan increased by 2 shares as a result of forfeitures, cancellations and/or terminations from the Company's 1997 Stock Option Plan. The 2005 Plan provides for the grant of non-qualified and incentive stock options, restricted stock, stock appreciation rights and deferred stock awards to employees and non-employees. All stock options are granted with an exercise price of not less than 100% of the fair value of the Company’s common stock at the date of grant and the options generally have a term of seven years. There were 2,559 shares available for future grant under the 2005 Plan at June 30, 2017.

As part of the Company's ongoing annual equity grant program for employees, the Company grants performance-based restricted stock awards to certain executives pursuant to the 2005 Plan. Performance awards vest based on the requisite service period subject to the achievement of specific financial performance targets. Based on the performance targets, some of these awards require graded vesting which results in more rapid expense recognition compared to traditional time-based vesting over the same vesting period. The Company monitors the probability of achieving the performance targets on a quarterly basis and may adjust periodic stock compensation expense accordingly. The performance targets include: (i) the achievement of internal performance targets only, and (ii) the achievement of internal performance targets in relation to a peer group of companies.

EMPLOYEE STOCK PURCHASE PLAN

The number of shares authorized for issuance under the Company’s 1997 Employee Stock Purchase Plan, as amended and restated (“ESPP”), is 1,800 shares. Under the ESPP, rights are granted to purchase shares of common stock at 85% of the lesser of the market value of such shares at either the beginning or the end of each six-month offering period. The ESPP permits employees to purchase common stock through payroll deductions, which may not exceed 10% of an employee’s compensation as defined in the ESPP. The number of shares issued under the ESPP during fiscal years 2017, 2016, and 2015 was 96, 88 and 79, respectively. Shares available for future purchase under the ESPP totaled 302 at June 30, 2017.

STOCK OPTION AND AWARD ACTIVITY

The following table summarizes activity of the Company’s stock option plans since June 30, 2015:



	Options Outstanding
	Number of Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value as of 6/30/2017
Outstanding at June 30, 2015	830		$	13.43	1.66
Granted	—		—
Exercised	(524	)	13.12
Cancelled	(48	)	17.25
Outstanding at June 30, 2016	258		$	13.34	1.06
Granted	—		—
Exercised	(207	)	13.29
Cancelled	—		—
Outstanding at June 30, 2017	51		$	13.53	0.60	$	1,442
Vested and expected to vest at June 30, 2017	51		$	13.53	0.60	$	1,442
Exercisable at June 30, 2017	51		$	13.53	0.60	$	1,442

The intrinsic value of the options exercised during fiscal years 2017, 2016, and 2015 was $3,762, $1,976 and $3,373, respectively. Non-vested stock options are subject to the risk of forfeiture until the fulfillment of specified conditions. As of June 30, 2017 and 2016, there was $0 of total unrecognized compensation cost related to non-vested options granted under the Company’s stock plans. There were no stock options granted during fiscal years 2017, 2016 or 2015.

The following table summarizes the status of the Company’s non-vested restricted stock awards since June 30, 2015:



	Non-Vested Restricted Stock Awards
	Number of Shares		Weighted Average Grant Date Fair Value
Outstanding at June 30, 2015	1,866		$	10.72
Granted	667		16.26
Vested	(743	)	10.93
Forfeited	(124	)	11.70
Outstanding at June 30, 2016	1,666		$	13.09
Granted	718		24.72
Vested	(769	)	11.94
Forfeited	(51	)	15.02
Outstanding at June 30, 2017	1,564		$	18.93

The total fair value of restricted stock awards vested during fiscal year 2017, 2016, and 2015 was $19,402, $12,185 and $9,078, respectively.

Non-vested restricted stock awards are subject to the risk of forfeiture until the fulfillment of specified conditions. As of June 30, 2017, there was $12,160 of total unrecognized compensation cost related to non-vested restricted stock awards granted under the Company’s stock plans that is expected to be recognized over a weighted-average period of 1.5 years from June 30, 2017. As of June 30, 2016, there was $10,938 of total unrecognized compensation cost related to non-vested restricted stock awards granted under the Company’s stock plans that is expected to be recognized over a weighted-average period of 1.6 years from June 30, 2016.

STOCK-BASED COMPENSATION EXPENSE

The Company recognizes expense for its share-based payment plans in the consolidated statements of operations for the fiscal years 2017, 2016, and 2015 in accordance with FASB ASC 718. The Company had $194 and $93 of capitalized stock-based compensation expense on the Consolidated Balance Sheet as of June 30, 2017 and 2016. In the prior years, the Company did not capitalize any such costs on the consolidated balance sheets, as such costs that qualified for capitalization were not material. Under the fair value recognition provisions of FASB ASC 718, stock-based compensation cost is measured at the grant date based on the value of the award and is recognized as expense over the service period. The following table presents share-based compensation expenses from continuing operations included in the Company’s consolidated statement of operations:



	Year Ended June 30,
	2017			2016			2015
Cost of revenues	$	531		$	441		$	493
Selling, general and administrative	13,212			7,864			6,751
Research and development	1,598			1,269			1,396
Share-based compensation expense before tax	15,341			9,574			8,640
Income taxes	(5,874		)	(3,727		)	(3,332		)
Share-based compensation expense, net of income taxes	$	9,467		$	5,847		$	5,308