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10. STOCK-BASED COMPENSATION
 3 Months Ended
Jun. 30, 2020
STOCK-BASED COMPENSATION  
NOTE 10 - STOCK-BASED COMPENSATION

 

NOTE 10—STOCK-BASED COMPENSATION

 

As of June 30, 2020, 2,417,454 shares of common stock were available for grant under the Company’s 2016 Equity Incentive Plan.

 

The following table summarizes the Company’s stock option activities for the three months ended June 30, 2020:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted

 

 

 

 

 

 

 

 

 

 

 

Number of Shares

 

Average

 

Weighted

 

 

 

 

 

 

Shares

 

Underlying

 

Remaining

 

Average

 

 

 

 

 

 

Available for

 

Options

 

Contractual

 

Exercise

 

Intrinsic

 

 

    

Grant

    

Outstanding

    

Life (Years)

    

Price

    

Value

 

Balance at March 31, 2020

 

2,522,314

 

8,135,791

 

 

 

$

6.17

 

 

 

 

Granted

 

(114,110)

 

114,110

 

 

 

$

7.65

 

 

 

 

Exercised

 

 —

 

(321,188)

 

 

 

$

6.21

 

$

428,272

 

Forfeited

 

9,250

 

(9,500)

 

 

 

$

7.92

 

 

 

 

Balance at June 30, 2020

 

2,417,454

 

7,919,213

 

5.48

 

$

6.19

 

 

 

 

Options vested and exercisable

 

 

 

5,407,382

 

4.18

 

$

5.64

 

$

8,712,915

 

Options vested and expected to vest

 

 

 

7,859,438

 

5.46

 

$

6.18

 

$

9,282,831

 

 

The weighted average fair value per underlying share of options granted during the three months ended June 30, 2020 and 2019 was $2.80 and $2.70, respectively.

 

Options outstanding by exercise price at June 30, 2020 were as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Number of

 

Options Outstanding

 

Options Exercisable

 

 

 

 

 

 

Shares

 

Weighted

 

Weighted Average

 

 

 

Weighted

 

 

 

 

 

 

Underlying

 

Average

 

Remaining

 

Number

 

Average

 

 

 

 

 

 

Options

 

Exercise

 

Contractual

 

Vested and

 

Exercise

 

Exercise Price

    

Outstanding

    

Price

    

Life (Years)

    

Exercisable

    

Price

 

$

3.40

-

4.81

 

902,585

 

$

4.06

 

3.82

 

902,585

 

$

4.06

 

$

4.90

-

4.99

 

1,316,046

 

$

4.97

 

4.95

 

1,316,046

 

$

4.97

 

$

5.13

-

5.59

 

926,721

 

$

5.32

 

4.14

 

891,496

 

$

5.32

 

$

5.69

-

6.28

 

838,702

 

$

5.99

 

4.55

 

650,263

 

$

5.98

 

$

6.45

-

6.70

 

1,197,400

 

$

6.63

 

5.41

 

652,453

 

$

6.58

 

$

6.82

-

7.26

 

1,192,855

 

$

7.06

 

5.47

 

661,556

 

$

6.95

 

$

7.40

-

8.06

 

737,571

 

$

7.75

 

8.82

 

135,626

 

$

7.59

 

$

8.09

 

 

 

83,860

 

$

8.09

 

7.58

 

41,804

 

$

8.09

 

$

8.30

 

 

 

614,893

 

$

8.30

 

9.07

 

46,973

 

$

8.30

 

$

9.20

 

 

 

108,580

 

$

9.20

 

0.59

 

108,580

 

$

9.20

 

 

 

 

 

 

7,919,213

 

$

6.19

 

5.48

 

5,407,382

 

$

5.64

 

 

The following table summarizes stock-based compensation expense by line item in the Condensed Consolidated Statements of Operations, all relating to employee stock plans:

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30,

 

 

 

2020

 

2019

    

 

 

 

 

 

 

 

 

Cost of revenues

 

$
88

 

$

55

 

Research and development

 

 
413

 

 

399

 

Selling, general and administrative

 

 
254

 

 
197

 

Total

 

$

755

 

$

651

 

 

As stock-based compensation expense recognized in the Condensed Consolidated Statement of Operations is based on awards ultimately expected to vest, it has been reduced for estimated forfeitures in accordance with authoritative guidance.  The Company estimates forfeitures at the time of grant and revises the original estimates, if necessary, in subsequent periods if actual forfeitures differ from those estimates.

 

No tax benefit related to stock-based compensation was recognized in the three months ended June 30, 2020 due to a full valuation allowance. There were no windfall tax benefits realized from exercised stock options in either of these periods. Compensation cost capitalized within inventory at June 30, 2020 was immaterial. As of June 30, 2020, the Company’s total unrecognized compensation cost was $4.5 million, which will be recognized over a weighted average period of 2.03 years.  The Company calculated the fair value of stock-based awards in the periods presented using the Black-Scholes option pricing model and the following weighted average assumptions:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30,

 

 

 

 

 

 

2020

 

 

 

 

2019

 

    

 

 

 

 

Stock Option Plans:

 

 

 

 

 

 

 

 

 

 

 

Risk-free interest rate

 

 

 
0.36

%

 

 

 
2.30

%

 

Expected life (in years)

 

 

 
5.00

 

 

 

 
5.00

 

 

Volatility

 

 

 
41.9

%

 

 

 
37.3

%

 

Dividend yield

 

 

 

 —

%

 

 

 

 —

%

 

Employee Stock Purchase Plan:

 

 

 

 

 

 

 

 

 

 

 

Risk-free interest rate

 

 

 
0.15

%

 

 

 
2.43

%

 

Expected life (in years)

 

 

 
0.50

 

 

 

 
0.50

 

 

Volatility

 

 

 
67.1

%

 

 

 
43.1

%

 

Dividend yield

 

 

 

 —

%

 

 

 

 —

%