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, 2018. 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 1,614 shares available for future grant under the 2005 Plan at June 30, 2018.

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 2018, 2017, and 2016 was 82, 96 and 88, respectively. Shares available for future purchase under the ESPP totaled 220 at June 30, 2018.

STOCK OPTION AND AWARD ACTIVITY

The following table summarizes activity of the Company’s stock option plans since June 30, 2016:



	Options Outstanding
	Number of Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value as of 6/30/2018
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
Granted	—		—
Exercised	(47	)	14.12
Cancelled	—		—
Outstanding at June 30, 2018	4		$	5.52	3.13	$	114
Vested and expected to vest at June 30, 2018	4		$	5.52	3.13	$	114
Exercisable at June 30, 2018	4		$	5.52	3.13	$	114

The intrinsic value of the options exercised during fiscal years 2018, 2017, and 2016 was $1,780, $3,762 and $1,976, respectively. Non-vested stock options are subject to the risk of forfeiture until the fulfillment of specified conditions. As of June 30, 2018 and 2017, 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 2018, 2017 or 2016.

The following table summarizes the status of the Company’s non-vested restricted stock awards since June 30, 2016:



	Non-Vested Restricted Stock Awards
	Number of Shares		Weighted Average Grant Date Fair Value
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
Granted	521		47.28
Vested	(821	)	46.71
Forfeited	(129	)	31.41
Outstanding at June 30, 2018	1,135		$	27.26

The total fair value of restricted stock awards vested during fiscal years 2018, 2017, and 2016 was $38,344, $19,402 and $12,185, respectively.

Non-vested restricted stock awards are subject to the risk of forfeiture until the fulfillment of specified conditions. As of June 30, 2018, there was $24,740 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 2.3 years from June 30, 2018. 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.

STOCK-BASED COMPENSATION EXPENSE

The Company recognizes expense for its share-based payment plans in the consolidated statements of operations for the fiscal years 2018, 2017, and 2016 in accordance with ASC 718. The Company had $317, $194 and $93 of capitalized stock-based compensation expense on the consolidated balance sheet as of June 30, 2018, 2017, and 2016, respectively. Under the fair value recognition provisions of 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,
	2018			2017			2016
Cost of revenues	$	502		$	531		$	441
Selling, general and administrative	14,828			13,212			7,864
Research and development	1,984			1,598			1,269
Stock-based compensation expense before tax	17,314			15,341			9,574
Income taxes	(5,713		)	(5,874		)	(3,727		)
Stock-based compensation expense, net of income taxes	$	11,601		$	9,467		$	5,847