10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 _____________________________________________________

 FORM 10-Q

 _____________________________________________________

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2022

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to ___________

Commission File No. 000-52082

 ____________________________________________________

CARDIOVASCULAR SYSTEMS, INC.

(Exact name of registrant as specified in its charter)

 ____________________________________________________

Delaware	41-1698056
(State or other jurisdiction of	(IRS Employer
incorporation or organization)	Identification No.)

1225 Old Highway 8 Northwest

St. Paul, Minnesota 55112-6416

(Address of principal executive offices, including zip code)

Registrant’s telephone number, including area code: (651) 259-1600

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, One-tenth of One Cent ($0.001) Par Value Per Share	CSII	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes x    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	x	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  x

The number of shares outstanding of the registrant’s Common Stock, $0.001 par value per share, as of May 2, 2022 was: 40,785,123 shares.

Cardiovascular Systems, Inc.

Table of Contents

 

	PAGE
PART I. FINANCIAL INFORMATION
ITEM 1. Consolidated Financial Statements (unaudited)	3
Consolidated Balance Sheets	3
Consolidated Statements of Operations	4
Consolidated Statements of Comprehensive Income	5
Consolidated Statements of Changes in Stockholders’ Equity	6
Consolidated Statements of Cash Flows	8
Notes to Consolidated Financial Statements	9
ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	18
ITEM 3. Quantitative and Qualitative Disclosures About Market Risk	27
ITEM 4. Controls and Procedures	27
PART II. OTHER INFORMATION
ITEM 1. Legal Proceedings	28
ITEM 1A. Risk Factors	28
ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds	28
ITEM 3. Defaults Upon Senior Securities	28
ITEM 4. Mine Safety Disclosures	28
ITEM 5. Other Information	28
ITEM 6. Exhibits	28
Signatures	30

2

PART I. — FINANCIAL INFORMATION

ITEM 1.    CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Cardiovascular Systems, Inc.

Consolidated Balance Sheets

(Dollars in thousands, except per share and share amounts)

(Unaudited)

 

	March 31, 2022		June 30, 2021
ASSETS
Current assets
Cash and cash equivalents	$	66,953	$	71,070
Marketable securities	105,098		135,968
Accounts receivable, net	34,666		40,033
Inventories	32,854		32,313
Prepaid expenses and other current assets	5,742		5,285
Total current assets	245,313		284,669
Property and equipment, net	29,097		28,894
Intangible assets, net	16,080		15,376
Strategic investments	30,733		20,657
Other assets	2,768		2,971
Total assets	$	323,991	$	352,567
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable	$	13,598	$	14,061
Accrued expenses	30,011		38,189
Deferred revenue	2,812		2,400
Total current liabilities	46,421		54,650
Long-term liabilities
Financing obligation	20,385		20,596
Deferred revenue	—		2,194
Other liabilities	3,687		4,169
Total liabilities	70,493		81,609
Commitments and contingencies (see Note 10)
Common stock, $0.001 par value; authorized 100,000,000 common shares; issued and outstanding 40,784,179 at March 31, 2022 and 40,215,554 at June 30, 2021, respectively	39		39
Additional paid in capital	667,552		652,288
Accumulated other comprehensive income	(212)		11
Accumulated deficit	(413,881)		(381,380)
Total stockholders’ equity	253,498		270,958
Total liabilities and stockholders’ equity	$	323,991	$	352,567

The accompanying notes are an integral part of these unaudited consolidated financial statements.

3

Cardiovascular Systems, Inc.

Consolidated Statements of Operations

(Dollars in thousands, except per share and share amounts)

(Unaudited)

 

	Three Months Ended				Nine Months Ended
	March 31,				March 31,
	2022		2021		2022		2021
Net revenues	$	56,221	$	63,273	$	173,726	$	187,986
Cost of goods sold	14,790		14,013		47,171		40,497
Gross profit	41,431		49,260		126,555		147,489
Expenses:
Selling, general and administrative	41,680		41,442		123,933		121,785
Research and development	9,052		13,163		27,947		31,816
Amortization of intangible assets	346		304		996		912
Total expenses	51,078		54,909		152,876		154,513
Loss from operations	(9,647)		(5,649)		(26,321)		(7,024)
Other (income) expense, net:
Interest expense	408		412		1,227		1,323
Interest income and other, net	(460)		(120)		(567)		(400)
Total other (income) expense, net	(52)		292		660		923
Loss before income taxes	(9,595)		(5,941)		(26,981)		(7,947)
Provision for income taxes	63		63		262		189
Net loss	$	(9,658)	$	(6,004)	$	(27,243)	$	(8,136)
Basic and diluted earnings per share	$	(0.25)	$	(0.15)	$	(0.70)	$	(0.21)
Basic and diluted weighted average shares outstanding	39,287,632		38,911,454		39,190,865		38,800,622

The accompanying notes are an integral part of these unaudited consolidated financial statements.

4

Cardiovascular Systems, Inc.

Consolidated Statements of Comprehensive Income

(Dollars in thousands)

(Unaudited)

	Three Months Ended				Nine Months Ended
	March 31,				March 31,
	2022		2021		2022		2021
Net loss	$	(9,658)	$	(6,004)	$	(27,243)	$	(8,136)
Other comprehensive loss:
Unrealized loss on available-for-sale debt securities	(154)		(72)		(223)		(226)
Comprehensive loss	$	(9,812)	$	(6,076)	$	(27,466)	$	(8,362)

The accompanying notes are an integral part of these unaudited consolidated financial statements.

5

Cardiovascular Systems, Inc.

Consolidated Statements of Changes in Stockholders’ Equity

(Dollars in thousands, except per share amounts)

(Unaudited)

	Common Stock		Additional Paid  In Capital		Accumulated Other Comprehensive Income		Accumulated Deficit		Total
Balances at June 30, 2021	$	39	$	652,288	$	11	$	(381,380)	$	270,958
Stock-based compensation related to restricted stock awards, net	—		5,523		—		—		5,523
Shares withheld for payroll taxes	—		—		—		(4,990)		(4,990)
Employee stock purchase plan activity	—		324		—		—		324
Unrealized loss on available-for-sale debt securities	—		—		(17)		—		(17)
Exercise of stock options	—		12		—		—		12
Net loss	—		—		—		(8,618)		(8,618)
Balances at September 30, 2021	$	39	$	658,147	$	(6)	$	(394,988)	$	263,192
Stock-based compensation related to restricted stock awards, net	—		3,659		—		—		3,659
Shares withheld for payroll taxes	—		—		—		(161)		(161)
Employee stock purchase plan activity	—		1,854		—		—		1,854
Unrealized loss on available-for-sale debt securities	—		—		(52)		—		(52)
Net loss	—		—		—		(8,967)		(8,967)
Balances at December 31, 2021	$	39	$	663,660	$	(58)	$	(404,116)	$	259,525
Stock-based compensation related to restricted stock awards, net	—		3,538		—		—		3,538
Shares withheld for payroll taxes	—		—		—		(107)		(107)
Employee stock purchase plan activity	—		354		—		—		354
Unrealized loss on available-for-sale debt securities	—		—		(154)		—		(154)
Net loss	—		—		—		(9,658)		(9,658)
Balances at March 31, 2022	$	39	$	667,552	$	(212)	$	(413,881)	$	253,498

The accompanying notes are an integral part of these unaudited consolidated financial statements.

6

Cardiovascular Systems, Inc.

Consolidated Statements of Changes in Stockholders’ Equity

(Dollars in thousands, except per share amounts)

(Unaudited)

	Common Stock		Additional Paid  In Capital		Accumulated Other Comprehensive Income (Loss)		Accumulated Deficit		Total
Balances at June 30, 2020	$	39	$	631,559	$	269	$	(363,075)	$	268,792
Stock-based compensation related to restricted stock awards, net	—		4,836		—		—		4,836
Shares withheld for payroll taxes	—		—		—		(3,410)		(3,410)
Employee stock purchase plan activity	—		332		—		—		332
Unrealized loss on available-for-sale debt securities	—		—		(69)		—		(69)
Net loss	—		—		—		(2,076)		(2,076)
Balances at September 30, 2020	$	39	$	636,727	$	200	$	(368,561)	$	268,405
Stock-based compensation related to restricted stock awards, net	—		3,545		—		—		3,545
Shares withheld for payroll taxes	—		—		—		(407)		(407)
Employee stock purchase plan activity	—		2,430		—		—		2,430
Unrealized loss on available-for-sale debt securities	—		—		(85)		—		(85)
Net loss	—		—		—		(56)		(56)
Balances at December 31, 2020	$	39	$	642,702	$	115	$	(369,024)	$	273,832
Stock-based compensation related to restricted stock awards, net	—		3,332		—		—		3,332
Shares withheld for payroll taxes	—		—		—		(1,009)		(1,009)
Employee stock purchase plan activity	—		372		—		—		372
Unrealized loss on available-for-sale debt securities	—		—		(72)		—		(72)
Net loss	—		—		—		(6,004)		(6,004)
Balances at March 31, 2021	$	39	$	646,406	$	43	$	(376,037)	$	270,451

The accompanying notes are an integral part of these unaudited consolidated financial statements.

7

Cardiovascular Systems, Inc.

Consolidated Statements of Cash Flows

(Dollars in thousands)

(Unaudited)

 

	Nine Months Ended
	March 31,
	2022		2021
Cash flows from operating activities
Net loss	$	(27,243)	$	(8,136)
Adjustments to reconcile net loss to net cash from operating activities
Depreciation of property and equipment	2,835		2,231
Amortization of intangible assets	996		912
Stock-based compensation	13,804		12,488
Charges incurred in connection with acquired IPR&D	—		3,353
Provision for doubtful accounts	50		—
(Gain) loss on disposal of equipment	(15)		138
Amortization of premium (accretion of discount) on marketable securities	1,106		1,026
Other	(402)		—
Changes in assets and liabilities
Accounts receivable	5,317		(12,844)
Inventories	(541)		(5,661)
Prepaid expenses and other assets	467		425
Accounts payable	(266)		1,147
Accrued expenses and other liabilities	(8,769)		3,910
Deferred revenue	(1,782)		(1,409)
Net cash used in operating activities	(14,443)		(2,420)
Cash flows from investing activities
Purchases of property and equipment	(3,220)		(2,758)
Acquisitions	(1,700)		(3,353)
Investments in strategic ventures	(9,674)		(8,374)
Purchases of marketable securities	(85,076)		(156,628)
Sales of marketable securities	13,692		4,885
Maturities of marketable securities	100,462		61,350
Net cash provided by (used in) investing activities	14,484		(104,878)
Cash flows from financing activities
Proceeds from employee stock purchase plan	1,242		2,098
Payments of employee taxes related to vested restricted stock	(5,258)		(4,826)
Exercise of stock options	12		—
Principal payments made on financing obligation	(154)		(104)
Net cash used in financing activities	(4,158)		(2,832)
Net change in cash and cash equivalents	(4,117)		(110,130)
Cash and cash equivalents
Beginning of period	71,070		185,463
End of period	$	66,953	$	75,333

The accompanying notes are an integral part of these unaudited consolidated financial statements.

8

CARDIOVASCULAR SYSTEMS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(For the Nine Months Ended March 31, 2022 and 2021)

(Dollars in thousands, except per share and share amounts)

(Unaudited)

1. Basis of Presentation

Cardiovascular Systems, Inc. (the “Company”), based in St. Paul, Minnesota, is a medical device company focused on developing and commercializing innovative solutions for treating vascular and coronary disease. The Company’s Orbital Atherectomy Systems (“OAS”) treat calcified and fibrotic plaque in arterial vessels throughout the leg and heart in a few minutes of treatment time, and address many of the limitations associated with existing surgical, catheter and pharmacological treatment alternatives. 

The Company prepared the unaudited interim consolidated financial statements and related unaudited financial information in the footnotes in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial statements. The year-end consolidated balance sheet was derived from the Company’s audited consolidated financial statements, but does not include all disclosures as required by GAAP. These interim consolidated financial statements reflect all adjustments consisting of normal recurring accruals, which, in the opinion of management, are necessary for a fair statement of the Company’s consolidated financial position, the results of its operations, its changes in stockholders’ equity, and its cash flows for the interim periods. Certain amounts in the prior years' consolidated financial statements have been reclassified to conform to the current year presentation. These interim consolidated financial statements should be read in conjunction with the consolidated annual financial statements and the notes thereto included in the Company's Annual Report on Form 10-K for the year ended June 30, 2021. The nature of the Company’s business is such that the results of any interim period may not be indicative of the results to be expected for the entire year.

The preparation of the Company’s consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company has been impacted by the COVID-19 pandemic. The full extent to which the COVID-19 pandemic will directly or indirectly impact the Company's business, results of operations and financial condition, including sales, expenses, reserves and allowances, manufacturing, clinical trials, research and development costs and employee-related amounts, will depend on future developments that are highly uncertain, including as a result of new information that may emerge concerning COVID-19 and the actions taken to contain or treat COVID-19, as well as the economic impact on the Company's customers and markets. The Company has made estimates of the impact of COVID-19 within these consolidated financial statements and there may be changes to those estimates in future periods. Actual results could differ from those estimates.

2. Selected Consolidated Financial Statement Information

Accounts Receivable, Net

Accounts receivable consists of the following:

	March 31,		June 30,
	2022		2021
Accounts receivable	$	35,871	$	41,634
Less: Allowance for doubtful accounts	(1,205)		(1,601)
Accounts receivable, net	$	34,666	$	40,033

9

Inventories

Inventories consist of the following:

	March 31,		June 30,
	2022		2021
Raw materials	$	12,337	$	11,621
Work in process	3,781		3,469
Finished goods	16,736		17,223
Inventories	$	32,854	$	32,313

WIRION Recall

In November 2021, the Company initiated a voluntary recall of unused WIRION embolic protection systems. In connection with the recall, the Company recorded a reserve for approximately $2,849 during the nine months ended March 31, 2022, which amount represents inventory that has no future intended use.

Property and Equipment, Net

Property and equipment consists of the following:

	March 31,		June 30,
	2022		2021
Land	$	572	$	572
Building	22,420		22,420
Equipment	24,045		21,203
Furniture	3,376		3,376
Leasehold improvements	812		804
Construction in progress	2,175		2,848
	53,400		51,223
Less: Accumulated depreciation	(24,303)		(22,329)
Property and equipment, net	$	29,097	$	28,894

Accrued Expenses

Accrued expenses consist of the following:

	March 31,		June 30,
	2022		2021
Acquisition consideration	$	10,000	$	10,000
Commissions	4,784		7,869
Salaries and bonus	6,726		11,699
Accrued vacation	2,349		3,011
Clinical Studies	1,255		1,478
Accrued excise, sales and other taxes	960		1,464
Other accrued expenses	3,937		2,668
Accrued expenses	$	30,011	$	38,189

10

WIRION Acquisition Consideration

Following the successful completion of the manufacturing transfer of the WIRION system to the Company, the Company has agreed to pay an additional consideration of $10,000, half of which may be paid by the Company through an issuance of shares of its common stock. The Company reviewed this liability in response to the voluntary recall of the WIRION system referred to above and determined that it remains probable and appropriately recorded in accrued liabilities as of March 31, 2022, although this payment will be made at a later date than originally anticipated due to the recall.

3. Revenue

The following table disaggregates the Company’s net revenues by product category and geography for the following periods:

	Three Months Ended				Nine Months Ended
	March 31,				March 31,
Product Category	2022		2021		2022		2021
Peripheral	$	37,370	$	42,295	$	115,282	$	129,183
Coronary	18,851		20,978		58,444		58,803
Total net revenues	$	56,221	$	63,273	$	173,726	$	187,986
Geography
United States	$	51,843	$	59,593	$	162,356	$	180,331
International	4,378		3,680		11,370		7,655
Total net revenues	$	56,221	$	63,273	$	173,726	$	187,986

Revenue of $1,782 was recognized in the nine months ended March 31, 2022 that was deferred as of June 30, 2021. As of March 31, 2022 and June 30, 2021, the Company had a liability of $1,254 and $1,985, respectively, related to estimates of variable consideration which are recorded within accounts payable on the consolidated balance sheet.

4. Acquisitions

Peripheral Support Catheters

During fiscal 2021, the Company acquired a line of peripheral support catheters from WavePoint Medical, LLC (“WavePoint”) and also engaged WavePoint to develop a portfolio of specialty catheters.

The acquisition of peripheral support catheters was accounted for as an asset acquisition. As consideration in this transaction, the Company made an upfront payment of $3,353 to WavePoint, which was accounted for as a charge incurred in connection with acquired in process research and development ("IPR&D"). During the nine months ended March 31, 2022, the peripheral support catheters received 510(k) clearance and the Company made an additional $1,700 payment to WavePoint pursuant to the terms of the parties' agreement, which amount was capitalized as developed technology.

5. Intangible Assets

The Company’s finite-lived intangible assets are stated at cost less accumulated amortization and include developed technology and trade name assets acquired in asset acquisitions, as well as costs incurred to obtain patents. Developed technology and trade name assets are amortized over 10 to 15 years. Patent costs are amortized beginning at the time of patent approval over a useful life not exceeding 20 years.

11

The components of intangible assets, net are as follows:

	March 31, 2022						June 30, 2021
	Gross Carrying Amount		Accumulated Amortization		Net Book Value		Gross Carrying Amount		Accumulated Amortization		Net Book Value
Developed technology	$	17,324	$	(2,863)	$	14,461	$	15,624	$	(1,997)	$	13,627
Patents	1,866		(872)		994		1,866		(780)		1,086
Trade name	760		(135)		625		760		(97)		663
Total intangible assets, net	$	19,950	$	(3,870)	$	16,080	$	18,250	$	(2,874)	$	15,376

Amortization expense expected for the next five years and thereafter is as follows:

Remainder of fiscal 2022	$	345
Fiscal 2023	1,381
Fiscal 2024	1,377
Fiscal 2025	1,374
Fiscal 2026	1,373
Thereafter	10,230
	$	16,080

6. Debt

Revolving Credit Facility

In March 2017, the Company entered into a Loan and Security Agreement (the “Loan Agreement”) with Silicon Valley Bank (“SVB”). In March 2020, the Company entered into the First Amendment to the Loan Agreement (the "Amendment"). The Amendment extended the maturity date of the Loan Agreement by two years, to March 31, 2022, and increased the maximum amount available under the senior, secured revolving credit facility (the “Revolver”) to $50,000 (the “Maximum Dollar Amount”). In March 2022, the Company entered into the Second Amendment to the Loan Agreement (the "Second Amendment"). The Second Amendment extended the maturity date of the Loan Agreement by one year, to March 31, 2023.

Advances under the Revolver may be made from time to time up to the Maximum Dollar Amount, subject to certain borrowing limitations. The Revolver bears interest at a floating per annum rate equal to the Wall Street Journal prime rate, less 0.75%. Interest on borrowings is due monthly and the principal balance is due at maturity. Upon the Revolver’s maturity, any outstanding principal balance, unpaid accrued interest, and all other obligations under the Revolver will be due and payable. The Company will incur a fee equal to 1.5% of the Maximum Dollar Amount upon termination of the Loan Agreement, as amended by the Second Amendment (the "Amended Loan Agreement"), or the Revolver for any reason prior to the date that is fifteen days prior to the maturity date, unless refinanced with SVB.

The Company’s obligations under the Amended Loan Agreement are secured by certain of the Company’s assets, including, among other things, accounts receivable, deposit accounts, inventory, equipment, general intangibles and records pertaining to the foregoing. The collateral does not include the Company’s intellectual property, but the Company has agreed not to encumber its intellectual property without the consent of SVB. The Amended Loan Agreement contains customary covenants limiting the Company’s ability to, among other things, incur debt or liens, make certain investments and loans, enter into transactions with affiliates, undergo certain fundamental changes, dispose of assets, or change the nature of its business. In addition, the Amended Loan Agreement contains financial covenants requiring the Company to maintain, at all times when any amounts are outstanding under the Revolver, either (i) minimum unrestricted cash at SVB and unused availability on the Revolver of at least $10,000 or (ii) minimum trailing three-month Adjusted EBITDA of $1,000. If the Company does not comply with the various covenants under the Amended Loan Agreement or an event of default under the Amended Loan Agreement occurs, such as a material adverse change, the interest rate on outstanding amounts will increase by 5% and SVB may, subject to various customary cure rights and the other terms and conditions of the Amended Loan Agreement, decline to provide additional advances under the Revolver, require the immediate payment of all amounts outstanding under the Revolver, and foreclose on all collateral.

12

The Company is required to pay a fee equal to 0.15% per annum on the unused portion of the Revolver, payable quarterly in arrears. The Company is not obligated to draw any funds under the Revolver and has not done so under the Revolver since entering into the Loan Agreement. No amounts are outstanding as of March 31, 2022.

Financing Obligation

In March 2017, in connection with the sale of the Company’s headquarters facility in St. Paul, Minnesota (the “Facility”), the Company entered into a Lease Agreement to lease the Facility. The Lease Agreement has an initial term of 15 years, with four consecutive renewal options of 5 years each at the Company’s option, with a base annual rent in the first year of $1,638 and annual escalations of 3% thereafter. Rent during subsequent renewal terms will be at the then fair market rental rate. As the lease terms resulted in a capital lease classification, the Company accounted for the sale and leaseback of the Facility as a financing transaction where the assets remain on the Company’s balance sheet and a financing obligation was recorded for $20,944. As lease payments are made, they will be allocated between interest expense and a reduction of the financing obligation, resulting in a value of the financing obligation that is equivalent to the net book value of the assets at the end of the lease term. The effective interest rate is 7.89%. At the end of the lease (including any renewal option terms), the Company will remove the assets and financing obligation from its balance sheet.

Payments under the initial term of the Lease Agreement as of March 31, 2022 are as follows:

Remainder of fiscal 2022	$	475
Fiscal 2023	1,913
Fiscal 2024	1,970
Fiscal 2025	2,029
Fiscal 2026	2,090
Thereafter	13,286
	$	21,763

7. Marketable Securities & Fair Value Measurements

The Company’s marketable securities are classified on the consolidated balance sheet as follows:

	March 31,		June 30,
	2022		2021
Short-term available-for-sale debt securities	$	94,236	$	129,908
Long-term available-for-sale debt securities	10,621		5,748
Available-for-sale debt securities	104,857		135,656
Mutual funds	241		312
Total marketable securities	$	105,098	$	135,968

Available-for-sale debt securities are invested in the following financial instruments:

			As of March 31, 2022
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
Commercial paper	$	37,450	$	—	$	—	$	37,450
Corporate debt	44,982		1		(117)		44,866
Asset backed securities	16,665		—		(79)		16,586
U.S. government securities	5,972		—		(17)		5,955
Total available-for-sale debt securities	$	105,069	$	1	$	(213)	$	104,857

13

			As of June 30, 2021
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
Commercial paper	$	47,361	$	—	$	—	$	47,361
U.S. government securities	20,229		1		—		20,230
Corporate debt	57,134		12		(12)		57,134
Asset backed securities	10,922		10		(1)		10,931
Total available-for-sale debt securities	$	135,646	$	23	$	(13)	$	135,656

The following table provides information by level for the Company’s marketable securities that were measured at fair value on a recurring basis:

			Fair Value Measurements as of March 31, 2022 Using Inputs Considered as
	Fair Value		Level 1		Level 2		Level 3
Commercial paper	$	37,450	$	—	$	37,450	$	—
U.S. government securities	5,955		—		5,955		—
Corporate debt	44,866		—		44,866		—
Asset backed securities	16,586		—		16,586		—
Mutual funds	241		124		117		—
Total marketable securities	$	105,098	$	124	$	104,974	$	—

			Fair Value Measurements as of June 30, 2021 Using Inputs Considered as
	Fair Value		Level 1		Level 2		Level 3
Commercial paper	$	47,361	$	—	$	47,361	$	—
U.S. government securities	20,230		—		20,230		—
Corporate debt	57,134		—		57,134		—
Asset backed securities	10,931		—		10,931		—
Mutual funds	312		136		176		—
Total marketable securities	$	135,968	$	136	$	135,832	$	—

The Company’s marketable securities classified within Level 1 are valued using real-time quotes for transactions in active exchange markets. Marketable securities within Level 2 are valued using readily available pricing sources. There were no transfers of assets between Level 1 and Level 2 of the fair value measurement hierarchy during the nine months ended March 31, 2022. Any transfers between levels would be recognized on the date of the event or when a change in circumstances causes a transfer.

Strategic Investments

The Company holds equity investments that do not have readily determined fair values. The Company has elected to measure these investments at cost minus impairment, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. Impairment is reviewed each reporting period by performing a qualitative assessment considering impairment indicators to evaluate whether the investment is impaired.

As of March 31, 2022 and June 30, 2021, the carrying value of these investments was $12,353 and $11,706, respectively. During the nine months ended March 31, 2022, no impairment indicators were noted. The Company is committed to funding an additional $1,410 into these investments in the future. The Company holds options to acquire all outstanding equity or certain developed technologies with respect to some of these strategic investments.

The Company also holds strategic investments accounted for as available-for-sale debt securities, which had carrying values and approximated fair values of $18,380 and $8,951 as of March 31, 2022 and June 30, 2021, respectively. The fair values of these investments are measured using Level 3 inputs and are not included in the tables above. Impairment is assessed similar to

14

the Company's other strategic investments and no impairment indicators were noted during the nine months ended March 31, 2022.

8. Stock-Based Compensation

On November 15, 2017, the Company’s stockholders approved the 2017 Equity Incentive Plan (the “2017 Plan”) for the purpose of granting equity awards to employees, directors and consultants. On March 12, 2020, the Company’s Board of Directors approved the Amended and Restated 2017 Equity Incentive Plan, which amends the 2017 Plan. On August 19, 2021, the Company's Board of Directors adopted an amendment to the 2017 Plan, which was approved by the Company's stockholders on November 11, 2021, that increased the number of shares available for issuance under the 2017 Plan by 1,700,000 shares.

Equity awards classified as restricted stock and performance-based restricted stock are treated as issued shares when granted; however, these shares are not included in the computation of basic weighted average shares outstanding. When shares vest, unless the holder elects to pay the payroll tax liability in cash or through a sale of shares, the Company withholds the appropriate amount of shares to settle the payroll tax liability, on behalf of the individual receiving the shares, as an adjustment to accumulated deficit.

Restricted Stock

The value of each restricted stock award is equal to the fair market value of the Company’s common stock at the date of grant. Vesting of time-based restricted stock awards ranges from one year to three years. The estimated fair value of restricted stock awards, including the effect of estimated forfeitures, is recognized on a straight-line basis over the restricted stock’s vesting period.

Restricted stock award activity for the nine months ended March 31, 2022 is as follows:

	Number of Shares	Weighted Average Fair Value
Outstanding at June 30, 2021	467,942	$	35.61
Granted	556,934	$	28.16
Forfeited	(97,041)	$	33.89
Vested	(227,219)	$	36.44
Outstanding at March 31, 2022	700,616	$	29.68

Performance-Based Restricted Stock

The Company also grants performance-based restricted stock awards to certain executives and other management. In August 2021, the Company granted an aggregate maximum of 306,550 shares that vest based on the Company’s total shareholder return relative to total shareholder return of the Company’s peer group (a market condition), as measured by the closing prices of the stock of the Company and the peer group members for the 90 trading days preceding July 1, 2021 compared to the closing prices of the stock of the Company and the peer group members for the 90 trading days preceding July 1, 2024. Vesting of these awards will be determined on the date that the Company’s Annual Report on Form 10-K for the fiscal year ending June 30, 2024 is filed.

To calculate the estimated fair value of these restricted stock awards with market conditions, the Company uses a Monte Carlo simulation, which uses the expected average stock prices to estimate the expected number of shares that will vest. The Monte Carlo simulation resulted in an aggregate fair value of approximately $6,090, which the Company will recognize as expense using the straight-line method over the period that the awards are expected to vest. Stock-based compensation expense related to an award with a market condition will be recognized regardless of whether the market condition is satisfied, provided that the requisite service has been provided.

Performance-based restricted stock awards granted in fiscal 2021 and 2020 that are outstanding vest based on the Company’s total shareholder return relative to total shareholder return of the Company’s peer group (a market condition), as measured by the closing prices of the stock of the Company and the peer group members for the 90 trading days preceding July 1, 2020 and July 1, 2019, respectively, compared to the closing prices of the stock of the Company and the peer group members for the 90 trading days preceding July 1, 2023 and July 1, 2022, respectively.

15

Performance-based restricted stock award activity for the nine months ended March 31, 2022 is as follows:

	Number of Shares	Weighted Average Fair Value
Outstanding at June 30, 2021	760,584	$	20.26
Granted	306,550	$	19.87
Forfeited	(130,739)	$	22.73
Vested	(147,001)	$	22.32
Outstanding at March 31, 2022	789,394	$	19.52

Unrecognized stock compensation related to unvested stock awards outstanding as of March 31, 2022 was $20,014.

9. Leases

The Company leases its Texas manufacturing facility under an operating lease agreement which expires in April 2026. The Company also leases office equipment under lease agreements that expire at various dates through December 2026. As discussed in Note 6, the Company also leases its Minnesota headquarters facility which is accounted for as a financing obligation.

Operating lease right-of-use assets and liabilities are recognized based on the present value of future minimum lease payments over the lease term at commencement dates. The Company considers fixed or variable payment terms, prepayments, incentives, and options to extend, terminate or purchase. Renewal, termination or purchase options affect the lease term used for determining lease asset value only if the option is reasonably certain to be exercised. The Company uses its incremental borrowing rate based on information available at the lease commencement date in determining the present value of lease payments unless the lease provides an implicit interest rate.

Operating lease cost is classified within the consolidated statement of operations based on the nature of the leased asset. The Company's operating lease cost was $387 and $377 for the nine months ended March 31, 2022 and 2021, respectively. Cash paid for operating lease liabilities approximated operating lease cost for the nine months ended March 31, 2022. There were $103 and $2,238 of operating lease right-of-use assets obtained in exchange for new lease liabilities during the nine months ended March 31, 2022 and 2021, respectively.

	March 31,		June 30,
	2022		2021
Right-of-use assets
Other assets	$	1,936	$	2,212
Operating lease liabilities
Accrued expenses	510		487
Other liabilities	1,426		1,725
Total operating lease liabilities	$	1,936	$	2,212

Future minimum lease payments under the agreements as of March 31, 2022 are as follows:

Remainder of fiscal 2022	$	134
Fiscal 2023	528
Fiscal 2024	503
Fiscal 2025	494
Fiscal 2026	406
Thereafter	2
Total lease payments	2,067
Less imputed interest	(131)
Total operating lease liabilities	$	1,936

16

As of March 31, 2022, the weighted average remaining lease term for operating leases was 4.0 years and the weighted average discount rate used to determine operating lease liabilities was 2.51%.

10. Commitment and Contingencies

In the ordinary conduct of business, the Company is subject to various lawsuits and claims covering a wide range of matters including, but not limited to, employment claims, commercial disputes and product liability claims. While the outcome of these matters is uncertain, the Company does not believe there are any significant matters as of March 31, 2022 that are probable or estimable, for which the outcome could have a material adverse impact on its consolidated balance sheets or statements of operations.

11. Earnings Per Share

The following table presents a reconciliation of the numerators and denominators used in the basic and diluted earnings per common share computations (in thousands except share and per share amounts):

	Three Months Ended				Nine Months Ended
	March 31,				March 31,
	2022		2021		2022		2021
Numerator
Net loss	$	(9,658)	$	(6,004)	$	(27,243)	$	(8,136)
Income allocated to participating securities	—		—		—		—
Net loss available to common stockholders	$	(9,658)	$	(6,004)	$	(27,243)	$	(8,136)
Denominator
Weighted average common shares outstanding – basic	39,287,632		38,911,454		39,190,865		38,800,622
Effect of dilutive stock options(1)	—		—		—		—
Effect of dilutive restricted stock units(2)	—		—		—		—
Effect of performance-based restricted stock awards(3)	—		—		—		—
Weighted average common shares outstanding – diluted	39,287,632		38,911,454		39,190,865		38,800,622
Earnings per common share – basic and diluted	$	(0.25)	$	(0.15)	$	(0.70)	$	(0.21)

(1)At March 31, 2022 and 2021, 76,019 and 42,528 stock options, respectively, were outstanding. The effect of the shares that would be issued upon exercise of these options has been excluded from the calculation of diluted loss per share for all periods presented because those shares are anti-dilutive.

(2)At March 31, 2022 and 2021, 310,415 and 282,763 additional shares of common stock, respectively, were issuable upon the settlement of outstanding restricted stock units. The effect of the shares that would be issued upon settlement of these restricted stock units has been excluded from the calculation of diluted loss per share for all periods presented because those shares are anti-dilutive.

(3)At March 31, 2022 and 2021, 789,394 and 760,584 performance-based restricted stock awards, respectively, were outstanding. The effect of the potential vesting of these awards has been excluded from the calculation of diluted loss per share for all periods presented because those shares are anti-dilutive.

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ITEM 2.    MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and the related notes appearing under Item 1 of Part I of this Quarterly Report on Form 10-Q. Some of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report on Form 10-Q, including information with respect to our plans and strategy for our business and expected financial results, includes forward-looking statements that involve risks and uncertainties. You should review the “Risk Factors” discussed in our Annual Report on Form 10-K for the year ended June 30, 2021 and subsequent Quarterly Reports on Form 10-Q, including in Item 1A of Part II of this Quarterly Report on Form 10-Q, for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

OVERVIEW

We are a medical technology company leading the way in the effort to successfully treat patients suffering from peripheral and coronary artery diseases, including those with arterial calcium, the most difficult form of arterial disease to treat. We are committed to clinical rigor, constant innovation and a defining drive to set the industry standard to deliver safe and effective medical devices that improve the lives of patients facing this difficult disease state. We have developed patented orbital atherectomy systems (“OAS”) for both peripheral and coronary clinical applications. The primary base of our business is catheter-based platforms capable of treating a broad range of vessel sizes and plaque types, including calcified plaque, which address many of the limitations associated with other treatment alternatives.

Peripheral

Our peripheral artery disease (“PAD”) products are catheter-based platforms capable of treating a broad range of plaque types in leg arteries both above and below the knee, including calcified plaque, and address many of the limitations associated with other existing surgical, catheter and pharmacological treatment alternatives. The micro-invasive devices use small access sheaths that can provide procedural benefits, allow physicians to treat PAD patients in even the small and tortuous vessels located below the knee, and facilitate access through alternative sites in the ankle, foot and wrist, as well as in the groin.

The United States Food and Drug Administration (“FDA”) has granted us 510(k) clearances for our Peripheral OAS as a therapy in patients with PAD, as discussed in Item 1 of Part I of our Annual Report on Form 10-K for the year ended June 30, 2021. We refer to these products in this Quarterly Report on Form 10-Q as the “Peripheral OAS.” In addition to our Peripheral OAS, we also offer support products within the peripheral space. Peripheral sales in the United States during the nine months ended March 31, 2022 represented 66% of revenue.

Coronary

Our coronary artery disease (“CAD”) product, the Diamondback 360 Coronary OAS (“Coronary OAS”), is a catheter-based platform designed to facilitate stent delivery in patients with CAD who are acceptable candidates for percutaneous transluminal coronary angioplasty or stenting due to de novo, severely calcified coronary artery lesions. The Coronary OAS design is similar to technology used in our Peripheral OAS, customized specifically for the coronary application. In addition to the Coronary OAS, we also offer support products within the coronary space as we expand treatment to a broader patient population with complex coronary artery disease.

We have received premarket approval (“PMA”) from the FDA to market the Coronary OAS as a treatment for severely calcified coronary arteries. Coronary sales in the United States during the nine months ended March 31, 2022 represented approximately 27% of revenue.

International

We serve a growing patient population globally through an expanding distribution and sales network. Sales of our approved products in Japan are made through our exclusive Japan distributor, Medikit Co., Ltd. ("Medikit"). Sales of our products in the rest of the world, which primarily includes certain countries in Southeast Asia, Europe, Canada and the Middle East, are made through a network of distributors and sales agents. International sales during the nine months ended March 31, 2022 represented approximately 7% of revenue.

Impact of COVID-19

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The COVID-19 pandemic in the United States and internationally has caused us to experience ongoing disruptions in the procedures using our products. Procedures have been postponed, and may continue to be postponed, as a result of reduced availability of physicians or lab space to treat patients, the lack of personal protective equipment and active virus test kits, different treatment prioritizations, increased cost pressures and burdens on the overall healthcare infrastructure that result in reallocation of resources, customer staffing shortages, and governmental guidelines and restrictions. In addition, patients have elected to defer or avoid treatment for procedures that use our products due to anxiety about the potential spread of COVID-19 in facilities. Finally, our personnel and the personnel of our distribution partners experienced restrictions on their ability to access many customers, hospitals, labs and other medical facilities for sales activities, training and case support as they may have been deemed to be “non-essential” personnel by those facilities, and there has been a reduction in procedure activity in these accounts.

In addition to the impact on procedure volumes, we experienced other disruptions as a result of the COVID-19 pandemic. For example, enrollment in our ECLIPSE clinical trial was paused for several months. Other disruptions included restrictions on the ability of our personnel and personnel of our distribution partners to travel; delays in approvals by regulatory bodies; delays in product development efforts, which has also disrupted or delayed our ability to launch affected products; reallocation of company resources from our strategic priorities; supply chain disruptions that limited, delayed or prevented us from acquiring the components used to develop and manufacture our products or ship those products once manufactured; disruptions in our relationships with our distributors due to the impact of the COVID-19 pandemic on their operations; temporary closures of our facilities; loss of employee productivity; additional government requirements to “shelter at home” or other incremental mitigation efforts that may further impact our capacity to manufacture, sell and support the use of our products; and we have experienced an increase in employee turnover, which we believe has been consistent with broader market conditions. To address the continuing uncertainties associated with the pandemic and utilize our resources more effectively, we have reduced our field clinical support and realigned a small number of our sales representatives in territories or regions where procedural volumes no longer warrant incremental case support.

Throughout the pandemic, we have operated our manufacturing facilities and continued to ship product. Most of our office-based employees have telecommuted, and our field employees have continued to support cases in clinical settings where they are able to have access. We took and continue to take several actions intended to protect the health and well-being of our workforce and our customers. We will continue to monitor developments at the local, state and national levels in order to ensure that we and our employees have current information for purposes of making decisions in the dynamic and unpredictable environment and that we comply with applicable requirements.

We are monitoring the spread of variants, and continue to track hospitalizations resulting from these variants. In particular, disruptions in procedures beginning in early December with the Omicron variant outbreak, which continued to adversely affect our business in the third quarter. Many factors may increase or decrease procedure volumes, which would have an impact on our revenue and financial results, including vaccination levels and mandates, the spread of new, more viral or deadly variants of the SARS-CoV-2 virus, easing of social restrictions and government restrictions on elective and semi-elective cases, level of patient anxiety, medical facility and workforce capacity, and sales representative access to facilities to support cases.

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CRITICAL ACCOUNTING POLICIES AND SIGNIFICANT JUDGMENTS AND ESTIMATES

Our management’s discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of our consolidated financial statements requires us to make estimates, assumptions and judgments that affect amounts reported in those statements. Our estimates, assumptions and judgments, including those related to revenue recognition, deferred revenue and stock-based compensation, are updated as appropriate at least quarterly. We use authoritative pronouncements, our technical accounting knowledge, cumulative business experience, judgment and other factors in the selection and application of our accounting policies. While we believe that the estimates, assumptions and judgments that we use in preparing our consolidated financial statements are appropriate, these estimates, assumptions and judgments are subject to factors and uncertainties regarding their outcome. Therefore, actual results may materially differ from these estimates.

Some of our significant accounting policies require us to make subjective or complex judgments or estimates. An accounting estimate is considered to be critical if it meets both of the following criteria: (1) the estimate requires assumptions about matters that are highly uncertain at the time the accounting estimate is made, and (2) different estimates that reasonably could have been used, or changes in the estimate that are reasonably likely to occur from period to period, would have a material impact on the presentation of our financial condition, results of operations, or cash flows.

Our critical accounting policies are identified in Item 7 of Part II of our Annual Report on Form 10-K for the fiscal year ended June 30, 2021 under the heading “Critical Accounting Policies and Significant Judgments and Estimates.”

RESULTS OF OPERATIONS

The following table sets forth our results of operations expressed as dollar amounts (in thousands) and the changes between the specified periods expressed as percent increases or decreases:

	Three Months Ended March 31,						Nine Months Ended March 31,
	2022		2021		Percent Change		2022		2021		Percent Change
Net revenues	$	56,221	$	63,273	(11.1)	%	$	173,726	$	187,986	(7.6)	%
Cost of goods sold	14,790		14,013		5.5		47,171		40,497		16.5
Gross profit	41,431		49,260		(15.9)		126,555		147,489		(14.2)
Expenses:
Selling, general and administrative	41,680		41,442		0.6		123,933		121,785		1.8
Research and development	9,052		13,163		(31.2)		27,947		31,816		(12.2)
Amortization of intangible assets	346		304		13.8		996		912		9.2
Total expenses	51,078		54,909		(7.0)		152,876		154,513		(1.1)
Loss from operations	(9,647)		(5,649)		70.8		(26,321)		(7,024)		(274.7)
Other (income) expense, net	(52)		292		(117.8)		660		923		(28.5)
Loss before income taxes	(9,595)		(5,941)		61.5		(26,981)		(7,947)		(239.5)
Provision for income taxes	63		63		—		262		189		38.6
Net loss	$	(9,658)	$	(6,004)	60.9		$	(27,243)	$	(8,136)	(234.8)

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Comparison of Three Months Ended March 31, 2022 with Three Months Ended March 31, 2021

Net revenues. Net revenues decreased by $7.1 million, or 11.1%, from $63.3 million for the three months ended March 31, 2021 to $56.2 million for the three months ended March 31, 2022. U.S. peripheral revenues decreased $4.9 million, or 11.7%, while U.S. coronary revenues decreased $2.8 million, or 16.0%. Both therapies were adversely affected by the impact of the Omicron variant of the SARS-CoV-2 virus, which began to surge in the U.S. in early December 2021. Contributing factors to the decreased case volumes from the Omicron variant were disruptions of referral patterns, deferrals of elective procedures, and staffing shortages. We have also been adversely affected by an increasingly competitive environment and reimbursement pressures in the office-based lab setting. Increased revenue from increased customer adoption of interventional support products partially offset the revenue declines from decreased case volumes in the peripheral and coronary franchise. International revenue was $4.4 million for the three months ended March 31, 2022, compared with international revenue of $3.7 million for the three months ended March 31, 2021. Although international sales were also impacted by the ongoing COVID-19 pandemic, increases in international sales were driven by a stronger recovery in Japan, increased adoption in Europe, and the commencement of sales into other territories. In the fourth quarter of fiscal 2022, we expect our revenue will continue to be impacted by the COVID-19 pandemic's effect on case volumes but to a lesser degree than previous quarters in fiscal 2022. Longer-term we expect revenue growth to improve when the pandemic subsides, driven by increasing the number of physicians using the devices; increasing the usage per physician; introducing new and improved products; generating additional clinical data; and continuing expansion into new geographies, partially offset by potential decreases in average selling prices. However, ongoing factors such as staffing shortages may continue to have an adverse impact.

Cost of Goods Sold. Cost of goods sold was $14.8 million for the three months ended March 31, 2022, an increase of 5.5% from $14.0 million for the three months ended March 31, 2021. These amounts represent the cost of materials, labor and overhead for single-use catheters, guide wires, pumps, and other ancillary products. Gross margin decreased to 73.7% for the three months ended March 31, 2022 from 77.9% for the three months ended March 31, 2021. The increase in cost of goods sold and decrease in gross margin was primarily due to lower unit volumes as well as increased sales of lower margin products. We expect that gross margin in the fourth quarter of fiscal 2022 will be approximately the same as the three months ended March 31, 2022. We anticipate that there will be a continued shift of sales mix into interventional support products and international markets in addition to declining average selling prices which will also impact gross margins. Quarterly margin fluctuations could also occur based on production volumes, timing of new product introductions, sales mix, pricing changes, or other unanticipated circumstances.

Selling, General and Administrative Expenses. Our selling, general and administrative expenses were $41.7 million for the three months ended March 31, 2022, an increase of 0.6% from $41.4 million for the three months ended March 31, 2021. Selling, general and administrative expense increases were led by costs associated with new product introductions and travel-related expenditures due to resumption of live meetings and tradeshows. These increases were partially offset by reduced commission expenses due to lower sales in the current year period and a decrease in incentive compensation expense due to lower performance. Selling, general and administrative expenses for the three months ended March 31, 2022 and 2021 include $3.4 million and $3.1 million, respectively, for stock-based compensation. We expect our selling, general and administrative expenses for the fourth quarter of fiscal 2022 to be greater than amounts incurred for the three months ended March 31, 2022.

Research and Development Expenses. Research and development expenses decreased by 31.2%, from $13.2 million for the three months ended March 31, 2021 to $9.1 million for the three months ended March 31, 2022. Research and development expenses relate to specific projects to develop new products or expand into new markets, such as the development of new versions of the Peripheral and Coronary OAS, shaft designs and crown designs, and expanded product offerings, including our percutaneous ventricular assist device, and to clinical trials. The decrease was primarily due to in process research and development ("IPR&D") charges incurred with our asset acquisition of a line of peripheral microcatheters in the three months ended March 31, 2021. We expect an increase in research and development expense in the fourth quarter of fiscal 2022 from what we incurred during the three months ended March 31, 2022. Quarterly fluctuations could occur based on the number of projects and studies, the progress of such projects and studies, the rate of study enrollment, acquisitions of IPR&D and possible charges in connection with those acquisitions, and the timing of expenditures.

21

Comparison of Nine Months Ended March 31, 2022 with Nine Months Ended March 31, 2021

Net revenues. Net revenues decreased by $14.3 million, or 7.6%, from $188.0 million for the nine months ended March 31, 2021 to $173.7 million for the nine months ended March 31, 2022. U.S. peripheral revenues decreased $14.1 million, or 10.9% and U.S. coronary revenues decreased $3.9 million, or 7.5%. Both therapies were adversely affected by the impact of the Delta and Omicron variants of the SARS-CoV-2 virus, especially within the hospital setting. Contributing factors to the decreased case volumes from the Delta and Omicron variants were disruptions of referral patterns, deferrals of elective procedures, staffing shortages and heightened summer seasonality in the quarter ended September 30, 2021. We have also been adversely affected by an increasingly competitive environment and reimbursement pressures in the office-based lab setting. Increased revenue from new product launches and increased customer adoption of interventional support products partially offset the revenue declines from decreased case volumes in the peripheral and coronary franchise. International revenue was $11.4 million for the nine months ended March 31, 2022, compared with international revenue of $7.7 million for the nine months ended March 31, 2021. Although international sales were also impacted by the ongoing COVID-19 pandemic, increases in international sales were driven by Coronary OAS sales in Europe, a stronger recovery in Japan, and the commencement of sales into other territories.

Cost of Goods Sold. Cost of goods sold was $47.2 million for the nine months ended March 31, 2022, an increase of 16.5% from $40.5 million for the nine months ended March 31, 2021. These amounts represent the cost of materials, labor and overhead for single-use catheters, guide wires, pumps, and other ancillary products. Gross margin decreased to 72.8% for the nine months ended March 31, 2022 from 78.5% for the nine months ended March 31, 2021. The increase in cost of goods sold and decrease in gross margin were primarily due to the $2.8 million reserve related to the voluntary recall of the WIRION device, lower unit volumes, as well as increased sales of lower margin products.

Selling, General and Administrative Expenses. Our selling, general and administrative expenses were $123.9 million for the nine months ended March 31, 2022, an increase of 1.8% from $121.8 million for the nine months ended March 31, 2021. Selling, general and administrative expense increases were led by costs associated with new product introductions and the resumption of travel-related expenditures due to increased live meetings and tradeshows, in addition to annual salary increases for our employees. These increases were partially offset by reduced commission expenses due to lower sales in the current year period and a decrease in incentive compensation expense due to lower performance. Selling, general and administrative expenses for the nine months ended March 31, 2022 and 2021 include $11.5 million and $10.5 million, respectively, for stock-based compensation.

Research and Development Expenses. Research and development expenses decreased by 12.2%, from $31.8 million for the nine months ended March 31, 2021 to $27.9 million for the nine months ended March 31, 2022. Research and development expenses relate to specific projects to develop new products or expand into new markets, such as the development of new versions of the Peripheral and Coronary OAS, shaft designs and crown designs, and expanded product offerings, including our percutaneous ventricular assist device, and to clinical trials. The decrease was primarily due to IPR&D charges incurred with our asset acquisition of a line of peripheral microcatheters in the nine months ended March 31, 2021.

LIQUIDITY AND CAPITAL RESOURCES

We had cash, cash equivalents and highly liquid marketable securities of $172.1 million and $207.0 million at March 31, 2022 and June 30, 2021, respectively. As of March 31, 2022, we had an accumulated deficit of $413.9 million. We have historically funded our operating losses primarily from the issuance of common and preferred stock, convertible promissory notes, and debt.

A summary of our cash flow activities (in thousands) is as follows:

	Nine Months Ended
	March 31,
	2022		2021
Net cash used in operating activities	$	(14,443)	$	(2,420)
Net cash provided by (used in) investing activities	14,484		(104,878)
Net cash used in financing activities	(4,158)		(2,832)
Net change in cash and cash equivalents	$	(4,117)	$	(110,130)

22

Changes in Liquidity

Operating Activities

Net cash used in operating activities was $14.4 million for the nine months ended March 31, 2022, primarily due to the net loss of $27.2 million, and $5.6 million relating to changes in working capital as a result of the payout of annual bonuses and commissions, partially offset by non-cash expenditures for the nine months ended March 31, 2022.

Net cash used in operating activities was $2.4 million for the nine months ended March 31, 2021, primarily due to the net loss of $8.1 million, and $14.4 million relating to changes in working capital as a result of the recovery from the initial wave of the COVID-19 pandemic in our business, partially offset by non-cash expenditures for the nine months ended March 31, 2022.

Investing Activities

Net cash provided by investing activities was $14.5 million for the nine months ended March 31, 2022, as maturities and sales of marketable securities exceeded marketable security purchases. These amounts were partially offset by a product acquisition of peripheral microcatheters, additional payments relating to strategic investments and capital expenditures as we continue to grow our business.

Net cash used in investing activities was $104.9 million for the nine months ended March 31, 2021, primarily due to investing cash from our June 2020 equity offering into marketable securities. We also deployed cash into strategic investments, product acquisitions and capital expenditures as we continue to grow our business. These uses of cash were partially offset by maturities and sales of marketable securities.

Financing Activities

Net cash used in financing activities was $4.2 million and $2.8 million for the nine months ended March 31, 2022 and 2021, respectively, primarily due to payment of payroll taxes on the employee vesting of stock awards, partially offset by proceeds from employee stock purchases.

Our future liquidity and capital requirements will be influenced by numerous factors, including the extent and duration of future operating losses, the level and timing of future sales and expenditures, the results and scope of ongoing research and product development programs, working capital required to support our business operations, the receipt of and time required to obtain regulatory clearances and approvals, our sales and marketing programs, the continuing acceptance of our products in the marketplace, competing technologies, market and regulatory developments, ongoing facility requirements, potential strategic transactions (including the potential acquisition of, or investments in, businesses, technologies and products), international expansion, the existence, defense and resolution of legal proceedings, and the severity and duration of the COVID-19 pandemic. As discussed in the "Overview" above, the total impact of disruptions from COVID-19 has had a material impact on our financial condition and results of operations, but once the pandemic subsides, we expect our U.S. business to improve. We will continue to closely monitor our liquidity and capital resources through the disruption caused by COVID-19 and will continue to evaluate our financial position to assess additional spending reductions and our liquidity needs. As of March 31, 2022, we believe our current cash, cash equivalents and marketable securities will be sufficient to fund working capital requirements, including open purchase commitments, capital expenditures and operations for the foreseeable future, including at least the next twelve months, as well as to fund payments under our lease agreements, payments under development agreements and future payments relating to our asset acquisition of the WIRION embolic protection system. If needed, we have the ability to borrow under our senior, secured revolving credit facility. We intend to retain any future earnings to support operations and to finance the growth and development of our business. We do not anticipate paying any dividends in the foreseeable future.

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Facility Sale and Lease

On December 29, 2016, we entered into a Purchase and Sale Agreement, as subsequently amended (collectively, the “Sale Agreement”), with Krishna Holdings, LLC (“Krishna”), providing for the sale to Krishna of our headquarters facility in St. Paul, Minnesota (the “Facility”) for a cash purchase price of $21.5 million. On March 30, 2017, the sale of the Facility under the Sale Agreement closed. We received proceeds of approximately $20.9 million ($21.5 million less $556,000 of transaction expenses). In connection with the closing of the facility sale, we entered into a Lease Agreement (the “Lease Agreement”) with Krishna Holdings, LLC, Apex Holdings, LLC, Kashi Associates, LLC, Keva Holdings, LLC, S&V Ventures, LLC, Polo Group LLC, SPAV Holdings LLC, Star Associates LLC, and The Global Villa, LLC. The Lease Agreement has an initial term of fifteen years, with four consecutive renewal options of five years each, with a base annual rent in the first year of $1.6 million and annual escalations of 3%. See Note 6 to our Consolidated Financial Statements included in Item 1 of Part I of this Quarterly Report on Form 10-Q for additional discussion.

Revolving Credit Facility

In March 2017, we entered into a Loan and Security Agreement (the “Loan Agreement”) with Silicon Valley Bank (“SVB”). In March 2020, we entered into the First Amendment to the Loan Agreement (the "Amendment"). The Amendment extended the maturity date of the Loan Agreement by two years, to March 31, 2022, and increased the maximum amount available under the senior, secured revolving credit facility (the "Revolver") to $50.0 million (the “Maximum Dollar Amount”). In March 2022, the Company entered into the Second Amendment to the Loan Agreement (the "Second Amendment"). The Second Amendment extended the maturity date of the Loan Agreement by one year, to March 31, 2023.

Advances under the Revolver may be made from time to time up to the Maximum Dollar Amount, subject to certain borrowing limitations. The Revolver bears interest at a floating per annum rate equal to the Wall Street Journal prime rate, less 0.75%. Interest on borrowings is due monthly and the principal balance is due at maturity. Upon the Revolver’s maturity, any outstanding principal balance, unpaid accrued interest, and all other obligations under the Revolver will be due and payable. We will incur a fee equal to 1.5% of the Maximum Dollar Amount upon termination of the Loan Agreement, as amended by the Second Amendment (the "Amended Loan Agreement"), or the Revolver for any reason prior to the date that is fifteen days prior to the maturity date, unless refinanced with SVB.

Our obligations under the Amended Loan Agreement are secured by certain of our assets, including, among other things, accounts receivable, deposit accounts, inventory, equipment, general intangibles and records pertaining to the foregoing. The collateral does not include our intellectual property, but we agreed not to encumber our intellectual property without the consent of SVB. The Amended Loan Agreement contains customary covenants limiting our ability to, among other things, incur debt or liens, make certain investments and loans, enter into transactions with affiliates, undergo certain fundamental changes, dispose of assets, or change the nature of our business. In addition, the Amended Loan Agreement contains financial covenants requiring us to maintain, at all times when any amounts are outstanding under the Revolver, either (i) minimum unrestricted cash at SVB and unused availability on the Revolver of at least $10.0 million or (ii) minimum trailing three-month Adjusted EBITDA (as defined in the Amended Loan Agreement) of $1.0 million. If we do not comply with the various covenants under the Amended Loan Agreement or an event of default under the Amended Loan Agreement occurs, such as a material adverse change, the interest rate on outstanding amounts will increase by 5% and SVB may, subject to various customary cure rights and the other terms and conditions of the Amended Loan Agreement, decline to provide additional advances under the Revolver, require the immediate payment of all amounts outstanding under the Revolver, and foreclose on all collateral.

We are required to pay a fee equal to 0.15% per annum on the unused portion of the Revolver, payable quarterly in arrears. We are not obligated to draw any funds under the Revolver and have not done so under the Revolver since entering into the Loan Agreement. No amounts were outstanding as of March 31, 2022 and we currently do not have plans to borrow under the Amended Loan Agreement.

NON-GAAP FINANCIAL INFORMATION

To supplement our condensed consolidated financial statements prepared in accordance with GAAP, our management uses a non-GAAP financial measure referred to as “Adjusted EBITDA.” Reconciliations of this non-GAAP measure to the most comparable U.S. GAAP measure for the respective periods can be found in the following table. In addition, an explanation of the manner in which our management uses this measure to conduct and evaluate our business, the economic substance behind our management's decision to use this measure, the substantive reasons why our management believes that this measure provides useful information to investors, the material limitations associated with the use of this measure and the manner in which our management compensates for those limitations is included following the reconciliation table.

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	Three Months Ended				Nine Months Ended
	March 31,				March 31,
	2022		2021		2022		2021
Net loss	$	(9,658)	$	(6,004)	$	(27,243)	$	(8,136)
Less: Other (income) expense, net	(52)		292		660		923
Less: Provision for income taxes	63		63		262		189
Loss from operations	(9,647)		(5,649)		(26,321)		(7,024)
Add: Stock-based compensation	3,892		3,704		13,804		12,488
Add: Depreciation and amortization	1,286		1,056		3,831		3,143
Adjusted EBITDA	$	(4,469)	$	(889)	$	(8,686)	$	8,607

Adjusted EBITDA decreased for the three and nine months ended March 31, 2022 as compared to the three and nine months ended March 31, 2021 primarily due to a greater loss from operations in the current year.

Use and Economic Substance of Non-GAAP Financial Measures Used and Usefulness of Such Non-GAAP Financial Measures to Investors

We use Adjusted EBITDA as a supplemental measure of performance and believe this measure facilitates operating performance comparisons from period to period and company to company by factoring out potential differences caused by depreciation and amortization expense, and stock-based compensation. Our management uses Adjusted EBITDA to analyze the underlying trends in our business, assess the performance of our core operations, establish operational goals and forecasts that are used to allocate resources and evaluate our performance period over period and in relation to our competitors’ operating results. Additionally, our management is partially evaluated on the basis of Adjusted EBITDA when determining achievement of their incentive compensation performance targets. Management does not use this Adjusted EBITDA measure as a liquidity measure or in the calculation of our financial covenants under the revolving credit facility with Silicon Valley Bank.

We believe that presenting Adjusted EBITDA provides investors greater transparency to the information used by our management for its financial and operational decision-making and allows investors to see our results “through the eyes” of management. We also believe that providing this information better enables our investors to understand our operating performance and evaluate the methodology used by our management to evaluate and measure such performance.

The following is an explanation of each of the items that management excluded from Adjusted EBITDA and the reasons for excluding each of these individual items:

•Stock-based compensation. We exclude stock-based compensation expense from our non-GAAP financial measures primarily because such expense, while constituting an ongoing and recurring expense, is not an expense that requires cash settlement.

•Depreciation and amortization expense. We exclude depreciation and amortization expense from our non-GAAP financial measures primarily because such expenses, while constituting ongoing and recurring expenses, are not expenses that require cash settlement and are not used by our management to assess the core profitability of our business operations.

Our management also believes that excluding these above items from our non-GAAP results is useful to investors to understand our operational performance, liquidity and ability to make additional investments in our company.

Beginning with the quarter ended March 31, 2022, following correspondence from the staff of the U.S. Securities and Exchange Commission, we no longer exclude IPR&D charges incurred in connection with asset acquisitions from Adjusted EBITDA or any other reported non-GAAP financial measures. For purposes of comparability, we have revised the reconciliation table above for three and nine months ended March 31, 2021 to reflect this approach.

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Material Limitations Associated with the Use of Non-GAAP Financial Measures and Manner in which We Compensate for these Limitations

Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as a substitute for our financial results prepared in accordance with GAAP. Some of the limitations associated with our use of these non-GAAP financial measures are:

•Items such as stock-based compensation do not directly affect our cash flow position; however, such items reflect economic costs to us and are not reflected in our Adjusted EBITDA, and therefore these non-GAAP measures do not reflect the full economic effect of these items.

•Non-GAAP financial measures are not based on any comprehensive set of accounting rules or principles and therefore other companies may calculate similarly titled non-GAAP financial measures differently than we do, limiting the usefulness of those measures for comparative purposes.

•Our management exercises judgment in determining which types of charges or other items should be excluded from the non-GAAP financial measures we use. We compensate for these limitations by relying primarily upon our GAAP results and using non-GAAP financial measures only supplementally.

We provide detailed reconciliations of each non-GAAP measure to its most directly comparable GAAP measure. We encourage investors to review these reconciliations. We qualify our use of non-GAAP financial measures with cautionary statements as set forth above.

INFLATION

We do not believe that inflation had a material impact on our business and operating results during the periods presented.

RECENT ACCOUNTING PRONOUNCEMENTS

For a description of recent accounting pronouncements, see Note 1 to the Consolidated Financial Statements included in Item 8 of Part II of our Annual Report on Form 10-K for the year ended June 30, 2021.

PRIVATE SECURITIES LITIGATION REFORM ACT

The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking statements. Such “forward-looking” information is included in this Quarterly Report on Form 10-Q and in other materials filed or to be filed by us with the SEC (as well as information included in oral statements or other written statements made or to be made by us). Forward-looking statements include all statements based on future expectations. This Quarterly Report on Form 10-Q contains forward-looking statements that involve risks and uncertainties, including, but not limited to, (i) our expectations regarding the impact of the COVID-19 pandemic on our operations; (ii) our expectation of continued sales of our products internationally, including the specific products to be sold, the territories in which such products will be sold, the timing of such sales, and whether such sales will be through distributors or directly by us; (iii) seasonality in our business; (iv) our expectation that our revenue will continue to be impacted by the COVID-19 pandemic during our fourth quarter but to a lesser extent than prior quarters in fiscal 2022, and that our revenue growth will improve; (v) our expectation that we will incur selling, general and administrative expenses in the fourth quarter of fiscal 2022 that are higher than the amounts incurred in the three months ended March 31, 2022; (vi) our expectation that gross margin in the fourth quarter of fiscal 2022 will be similar to the gross margin in the three months ended March 31, 2022; (vii) our expectation that we will incur research and development expenses in the fourth quarter of fiscal 2022 that are higher than the amounts incurred in the three months ended March 31, 2022; (viii) our belief that our current cash and cash equivalents will be sufficient to fund working capital requirements, capital expenditures and operations for the foreseeable future, as well as to fund certain other anticipated expenses; (ix) our intention to retain any future earnings to support operations and to finance the growth and development of our business; (x) our dividend expectations; (xi) our plan not to borrow under our loan and security agreement; and (xii) the anticipated impact of adoption of recent accounting pronouncements on our financial statements.

In some cases, you can identify forward-looking statements by the following words: “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “ongoing,” “plan,” “potential,” “predict,” “project,” “should,” “will,” “would,” or the negative of these terms or other comparable terminology, although not all forward-looking statements contain these words. Forward-looking statements are only predictions and are not guarantees of performance. These statements are based on our management’s beliefs and assumptions, which in turn are based on their interpretation of currently available information.

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These statements involve known and unknown risks, uncertainties and other factors that may cause our results or our industry’s actual results, levels of activity, performance or achievements to be materially different from the information expressed or implied by these forward-looking statements. These factors include the ongoing COVID-19 pandemic and the impact and scope thereof on us, our distribution partners, the supply chain and physicians and facilities, including government actions related to the COVID-19 outbreak, material delays and cancellations of procedures, delayed spending by healthcare providers, and distributor and supply chain disruptions; regulatory developments, clearances and approvals; approval of our products for distribution outside of the United States; approval of products for reimbursement and the level of reimbursement in the U.S., Japan and other foreign countries; dependence on market growth; agreements with third parties to sell their products; the ability of us and our distribution partners to successfully launch our products outside of the United States; our ability to maintain third-party supplier relationships and renew existing purchase agreements; our ability to maintain our relationships with distribution partners; the experience of physicians regarding the effectiveness and reliability of the products we sell; the reluctance of physicians, hospitals and other organizations to accept new products; the potential for unanticipated delays in enrolling medical centers and patients for clinical trials; actual clinical trial and study results; the impact of competitive products and pricing; our ability to comply with the financial covenants in our loan and security agreement and to make payments under and comply with the lease agreement for our corporate headquarters; unanticipated developments affecting our estimates regarding expenses, future revenues and capital requirements; the difficulty of successfully managing operating costs; our ability to manage our sales force strategy; actual research and development efforts and needs, including the timing of product development programs; successful development of new products; including agreements with development partners, advisors and other third parties; the ability of us and these third parties to meet development, contractual and other milestones; contractual rights and obligations; our ability to obtain and maintain intellectual property protection for product candidates; fluctuations in results and expenses based on new product introductions, sales mix, unanticipated warranty claims, and the timing of project expenditures; our ability to manage costs; our actual financial resources and our ability to obtain additional financing; investigations or litigation threatened or initiated against us; court rulings and future actions by the FDA and other regulatory bodies; international trade developments; the effects of hurricanes, flooding, and other natural disasters on our business; the impact of federal corporate tax reform on our business, operations and financial statements; shutdowns of the U.S. federal government; the potential impact of any future strategic transactions; and general economic conditions.

These and additional risks and uncertainties are described more fully in our Annual Report on Form 10-K for the year ended June 30, 2021 and subsequent Quarterly Reports on Form 10-Q, including in Item 1A of Part II of this Quarterly Report on Form 10-Q. Copies of filings made with the SEC are available through the SEC’s electronic data gathering analysis and retrieval system (EDGAR) at www.sec.gov.

You should read these risk factors and the other cautionary statements made in this Quarterly Report on Form 10-Q as being applicable to all related forward-looking statements wherever they appear in this Quarterly Report on Form 10-Q. We cannot assure you that the forward-looking statements in this Quarterly Report on Form 10-Q will prove to be accurate. Furthermore, if our forward-looking statements prove to be inaccurate, the inaccuracy may be material. You should read this Quarterly Report on Form 10-Q completely. Other than as required by law, we undertake no obligation to update these forward-looking statements, even though our situation may change in the future.

ITEM 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Other than the negative impact the COVID-19 pandemic has had and will continue to have on our business and results of operations as discussed elsewhere in this Quarterly Report on Form 10-Q, there have been no material changes in our primary risk exposures or management of market risks from those disclosed in our Annual Report on Form 10-K for the year ended June 30, 2021.

ITEM 4.    CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Our Chief Executive Officer and Chief Financial Officer, referred to collectively herein as the Certifying Officers, are responsible for establishing and maintaining our disclosure controls and procedures. The Certifying Officers have reviewed and evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of March 31, 2022. Based on that review and evaluation, which included inquiries made to certain other of our employees, the Certifying Officers have concluded that, as of the end of the period covered by this report, our disclosure controls and procedures, as designed and implemented, are effective.

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Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the three months ended March 31, 2022 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. — OTHER INFORMATION

ITEM 1.    LEGAL PROCEEDINGS

None.

ITEM 1A.    RISK FACTORS

In addition to the other information set forth in this Quarterly Report on Form 10-Q, including the important information in the section entitled “Private Securities Litigation Reform Act,” you should carefully consider the “Risk Factors” in our Annual Report on Form 10-K for the year ended June 30, 2021 for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in this Quarterly Report on Form 10-Q and materially adversely affect our business, financial condition and/or future operating results. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also might materially adversely affect our business, financial condition and/or operating results.

ITEM 2.    UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Company Repurchases of Equity Securities

The following table presents information with respect to purchases made by us of our common stock during the third quarter of fiscal 2022:

	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as part of Publicly Announced Plans or Programs	Approximate Dollar Value of Shares that May Yet Be Purchased under the Plan or Programs
January 1 to January 31, 2022	—	$	—	N/A	N/A
February 1 to February 28, 2022(1)	5,386	19.80		N/A	N/A
March 1 to March 31, 2022	—	—		N/A	N/A
	5,386	$	19.80

(1) Comprised of shares withheld pursuant to the terms of restricted stock awards under our stock-based compensation plans to offset tax withholding obligations that occur upon vesting and release of shares. The value of the shares withheld is the closing price of our common stock on the date the relevant transaction occurs.

ITEM 3.    DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4.    MINE SAFETY DISCLOSURES

None.

ITEM 5.    OTHER INFORMATION

None.

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ITEM 6.    EXHIBITS

Exhibit No.	Description
10.1†*	Fiscal 2022 Second Half Bonus Plan.
10.2†*	Separation Agreement, dated March 3, 2022, by and between the Company and Ryan Egeland.
10.3*	Second Amendment to Loan and Security Agreement, by and between Cardiovascular Systems, Inc. and Silicon Valley Bank, dated March 29, 2022.
31.1*	Certification of Chairman, President and Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*	Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1**	Certification of Chairman, President and Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2**	Certification of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101*	Financial statements from the Quarterly Report on Form 10-Q of the Company for the quarter ended March 31, 2022, formatted in Inline XBRL: (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Comprehensive Income, (iv) the Consolidated Statements of Changes in Stockholders’ Equity, (v) the Consolidated Statements of Cash Flows, and (vi) the Notes to Financial Statements.
104*	Cover page interactive data file (formatted in Inline XBRL and contained in Exhibit 101).

_______________________

*    Filed herewith.

**    Furnished herewith.

†    Compensatory plan or agreement.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized.

 

Dated: May 5, 2022		CARDIOVASCULAR SYSTEMS, INC.
	By	/s/ Scott R. Ward
		Scott R. Ward
		Chairman, President and Chief Executive Officer
		(Principal Executive Officer)
	By	/s/ Jeffrey S. Points
		Jeffrey S. Points
		Chief Financial Officer
		(Principal Financial and Accounting Officer)

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EX-10.1

Exhibit 10.1

FISCAL 2022 SECOND HALF BONUS PLAN

For the 6-month period ending June 30, 2022, each executive officer is eligible to receive cash incentive compensation pursuant to the second half fiscal 2022 Executive Officer Bonus Plan (the “Second Half Bonus Plan”), based on the Company’s achievement of revenue and Adjusted EBITDA financial goals for such period. In addition, Adjusted EBITDA may be further adjusted by the Human Resources and Compensation Committee (the “Committee”) to include or exclude the events set forth in Section 7(b) of the Company’s Amended and Restated 2017 Equity Incentive Plan and other unforeseen expenses. In light of continuing uncertainties relating to the ongoing COVID-19 pandemic and its impact on both the U.S. and global healthcare system and on the Company’s business, the Committee and the Board of Directors approved quarterly goals for the three months ended March 31, 2022 and the three months ending June 30, 2022.Target bonus amounts are weighted 75% for the revenue goals and 25% for the Adjusted EBITDA goals. Target bonus levels as a percentage of base salary are 57.5% for the Chief Executive Officer, 50% for the Chief Operating Officer and Chief Financial Officer, 37.5% for the General Counsel, and 30% for the other executive officers. Depending upon the Company’s performance against the goals, participants are eligible to earn up to 200% of each of the Adjusted EBITDA and revenue portions of their target bonus amount. The Second Half Bonus Plan goals are the same for all of the executive officers. No duplicate payments will be made between the Second Half Bonus Plan and the original full year cash bonus plan previously approved by the Committee and the Board.

EX-10.2

Exhibit 10.2

February 28, 2022

(Revised per your request and delivered via email on March 2, 2022)

Via Email

Personal and Confidential

Ryan Egeland

[ADDRESS REDACTED]

Re: Separation Agreement and Release

Dear Ryan:

As you know, your employment with Cardiovascular Systems, Inc. (“CSI”) will end effective at the close of business on March 3, 2022 (the “Separation Date). The purpose of this Separation Agreement and Release letter (“Agreement”) is to set forth the Salary Continuation Benefits and other benefits CSI will provide to you pursuant to the terms and conditions of CSI’s Executive Officer Severance Plan dated August 22, 2018 (the “Executive Officer Severance Plan”) in exchange for your agreement to the terms and conditions of this Agreement. Capitalized terms used but not otherwise defined in this Agreement will have the meaning set forth in Executive Officer Severance Plan. Please note that while we are giving this Agreement to you now for review, you may not execute this Agreement before your Separation Date.

By your signature below, you agree to the following terms and conditions:

1.End of Employment. Your employment with CSI will end effective at the close of business on the Separation Date. By signing below, you agree that as of the Separation Date you will be deemed to have also automatically resigned from all positions with CSI, if and as applicable. Upon your receipt of your final paycheck for services through the Separation Date, you will have received all wages, salary, bonuses, commissions and compensation owed to you by virtue of your employment with CSI or separation therefrom. If applicable, information regarding your right to elect COBRA coverage will be sent to you via separate letter. If elected, your COBRA period will begin April 1, 2022.

You are not eligible for any other payments or benefits by virtue of your employment with CSI or separation therefrom except for those expressly described in this Agreement. You will not receive the Salary Continuation Benefits and other benefits described in Section 2 of this Agreement if you (i) do not sign this Agreement and return it to CSI by the Offer Expiration, (ii) rescind this Agreement after signing it, or (iii) violate any of the terms and conditions set forth in this

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Agreement, Sections 9-13 of your Employment Agreement with CSI dated August 30, 2017 (your “Employment Agreement”), or any other written agreement in effect between you and CSI containing post-employment obligations. In addition, the benefits described in Section 2 of this Agreement shall be subject to reduction, cancellation, forfeiture, offset or recoupment as and to the extent required by the applicable provisions of any law (including without limitation Section 10D of the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder), government regulation or stock exchange listing requirement, or clawback policy or provision implemented by CSI pursuant to such law, regulation or listing requirement.

2.Salary Continuation Benefits and Other Benefits. Specifically in consideration of your signing this Agreement and subject to the limitations, obligations, and other provisions contained in this Agreement and the Executive Officer Severance Plan, CSI agrees as follows:

a.To pay you eighteen (18) months (the applicable Severance Period) of Salary Continuation Benefits based on your ending Base Salary, in the gross amount of $506,142.00, less applicable deductions and withholding, to be paid to you in substantially equal installments with the first such payment to be made to you on the sixtieth (60th) day following your Separation Date, provided the rescission periods described in Section 5 have expired without rescission, and continuing thereafter on CSI’s regular payday schedule. The first payment will include “catch-up” pay for the period between your Separation Date and the first payment date.

b.You will remain eligible for a pro-rata annual bonus under the Fiscal Year 2022 bonus plan(s) in which you participated, prorated for your period of employment during such bonus period (July 1, 2021 through June 30, 2022). Bonuses under such plan will be calculated following the close of Fiscal Year 2022 and, if any bonus is owing to you thereunder, such bonus will be paid to you in a lump sum payment, less applicable deductions and withholding, within ninety (90) days after the close of Fiscal Year 2022.

c.Provided you are eligible for and timely elect COBRA coverage, CSI shall pay the monthly employer portion toward your COBRA premiums necessary to continue your health, dental and/or life insurance coverage in effect for yourself and your eligible dependents as of the Separation Date until the earliest of (A) September 30, 2023 (B) the expiration of your eligibility for the continuation coverage under COBRA or any similar applicable state law, or (C) the date on which you participate in another employer’s group health insurance plan (such period from the Separation Date through the earliest of (A) through (C), the “COBRA Payment Period”). You shall timely pay your share of the COBRA premiums. Notwithstanding the foregoing, if CSI determines, in its sole discretion, that its payment of the COBRA premiums would result in a violation of the nondiscrimination rules of Section 105(h)(2) of the Code or any statute or regulation of similar effect (including but not limited to the 2010 Patient Protection and Affordable Care Act, as amended by the 2010 Health Care and Education Reconciliation Act), then in lieu of providing the COBRA premiums, CSI, in its sole discretion, may elect to instead pay you on the first day of each month of the COBRA Payment Period, a fully taxable cash

Page 3

payment equal to the COBRA premiums for that month, subject to applicable tax withholdings (such amount, the “Special Severance Payment”), for the remainder of the COBRA Payment Period. You may, but are not obligated to, use such Special Severance Payment toward the cost of COBRA premiums. If you participate in another group health plan or otherwise cease to be eligible for COBRA during the period provided in this clause, you must notify CSI within fifteen (15) days of such event, and all payments and obligations under this clause shall then cease.

d.To accelerate the vesting of 7,081 of your time-vested shares of CSI restricted stock that were previously granted to you that would have vested within the 12-month period following the Separation Date had you remained employed by CSI during such period such that they are deemed fully vested and not subject to any forfeiture or CSI call option as of the expiration of the rescission periods described in Section 5 below without rescission by you.

e.To provide for the vesting of up to 9,123, 8,178 and 2,589 of your performance-based shares of restricted stock that were previously granted to you that may vest in accordance with the Restricted Stock Agreements – Performance-Based Vesting relating to such shares following the Separation Date; provided, that the performance criteria for such vesting are met as determined by CSI in accordance with the terms for such shares of restricted stock (in or around August or September 2022, 2023 and 2024 (as applicable)) such that, if and to the extent applicable, such shares will become vested and not subject to any forfeiture or CSI call option as of such determination.

3.Release of Claims. Specifically in consideration of the pay and benefits described in Section 2, to which you would not otherwise be entitled, by signing this Agreement you, for yourself and anyone who has or obtains legal rights or claims through you, agree to the following:

a.You hereby do release and forever discharge the “Released Parties” (as defined in Section 3.e. below) of and from any and all manner of claims, demands, actions, causes of action, administrative claims, liability, damages, remedies, claims for punitive or liquidated damages, claims for attorney’s fees, costs and disbursements, individual or class action claims, or demands of any kind whatsoever, you have or might have against them or any of them, whether known or unknown, in law or equity, contract or tort, arising out of or in connection with your employment with CSI, or the termination of that employment, or otherwise, and however originating or existing, from the beginning of time through the date of your signing this Agreement.

b.This release includes, without limiting the generality of the foregoing, any claims you may have for, wages, salary, bonuses, commissions, penalties, deferred compensation, vacation, sick, PTO, and/or discretionary paid time off pay, separation or severance pay and/or benefits; tortious conduct, defamation, libel, slander, invasion of privacy, negligence, emotional distress; breach of implied or express contract (including, without limitation, arising under your Employment Agreement and/or the Executive Officer Severance Plan), estoppel; wrongful discharge (based on contract, common law, or statute, including any federal, state or local statute or

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ordinance prohibiting discrimination or retaliation in employment); violation of any of the following: the United States Constitution or the Minnesota Constitution; the Age Discrimination in Employment Act, 29 U.S.C. § 621 et seq., the Minnesota Human Rights Act, Minn. Stat. § 363A.01 etseq., Title VII of the Civil Rights Act, 42 U.S.C. § 2000e etseq., the Americans with Disabilities Act, 42 U.S.C. § 12101 etseq., the Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001 etseq., the Family and Medical Leave Act, 29 U.S.C. § 2601 etseq., the National Labor Relations Act, 29 U.S.C. § 151 etseq., the Sarbanes-Oxley Act, 15 U.S.C. § 7201 etseq.; any claim arising under Minn. Stat. Chapters 177 or 181; any claim for retaliation, including any claim for retaliation under Minn. Stat. Chapter 176; any claims related to whistleblower status, any claim arising under paid or unpaid sick, safe or other time off leave laws, and any claim for discrimination or harassment based on sex, race, color, creed, religion, age, national origin, marital status, familial status, sexual orientation, gender identity, disability, status with regard to public assistance, veteran or military status, genetic information, or any other legally-protected class under federal, state, county or local law. You hereby waive any and all relief not provided for in this Agreement. You understand and agree that, by signing this Agreement, you waive and release any claim to employment with CSI.

c.If you file, or have filed on your behalf, a charge, complaint, or action, you agree that the Salary Continuation Benefits and other benefits described above in Section 2 are in complete satisfaction of any and all claims in connection with such charge, complaint, or action and you waive, and agree not to take, any award of money or other damages from such charge, complaint, or action. Notwithstanding the foregoing, you do not waive your right to receive and fully retain a monetary award from a government-administered whistleblower award program, such as that administered by the Securities and Exchange Commission (“SEC”), for providing information directly to a governmental agency.

d.You are not, by signing this Agreement, releasing or waiving (1) any vested interest you may have in any 401(k) or profit sharing plan by virtue of your employment with CSI, (2) any rights or claims that may arise after the Agreement is signed by you, (3) the right to institute legal action for the purpose of enforcing the provisions of this Agreement, (4) any rights you have to workers’ compensation benefits, (5) any rights you have under state unemployment compensation benefits laws, (6) the right to file a charge or complaint with a governmental agency such as the Equal Employment Opportunity Commission (“EEOC”), the National Labor Relations Board (“NLRB”), the Occupational Safety and Health Administration (“OSHA”), the SEC or any other federal, state or local governmental agency, subject to Section 3(c) above, (7) the right to communicate with, testify, assist, or participate in an investigation, hearing, or proceeding conducted by, the EEOC, NLRB, OSHA, SEC or other governmental agency, (8) any rights you have under the Consolidated Omnibus Budget Reconciliation Act (“COBRA”), (9) your rights with regard to your restricted stock awards with CSI, if any, which shall be governed by those applicable operative agreement(s), as modified by Section 2 above, (10) the right to coverage and indemnification under CSI’s directors’ and officers’ insurance coverage as set forth in CSI’s D&O insurance policy and/or applicable law in effect from time to time, or (11) any claims

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arising under the Indemnification Agreement between you and CSI dated December 1, 2017 (the “Indemnification Agreement”). Further, nothing in this Agreement prohibits you from reporting possible violations of law or regulation to any governmental agency or regulatory authority, including but not limited to the SEC, or from making other disclosures that are protected under the whistleblower provisions of applicable law or regulation.

e.The “Released Parties,” as used in this Agreement, shall mean Cardiovascular Systems, Inc. and any parent, subsidiaries, divisions, affiliated entities, insurers, and its and their present and former officers, directors, shareholders, trustees, employees, agents, attorneys, representatives and consultants, and the successors and assigns of each, whether in their individual or official capacities, and the current and former trustees or administrators of any pension or other benefit plan applicable to the employees or former employees of CSI, in their official and individual capacities.

4.Notice of Right to Consult Attorney and Twenty-One (21) Calendar Day Consideration Period. By signing this Agreement, you acknowledge and agree that CSI has informed you by this Agreement that (1) you have the right to consult with an attorney of your choice prior to signing this Agreement, (2) you are entitled to at least Twenty-One (21) calendar days from your receipt of this Agreement to consider whether the terms are acceptable to you, and (3) if you sign the Agreement before the end of the 21-day consideration period, it will be your voluntary decision to do so because you have decided you do not need any additional time to decide whether to sign this Agreement.

5.Notification of Rights under the Minnesota Human Rights Act (Minn. Stat. Chapter 363A) and the Federal Age Discrimination in Employment Act (29 U.S.C. § 621 et seq.). You are hereby notified of your right to rescind the release of claims contained in Section 3 with regard to claims arising under the Minnesota Human Rights Act, Minnesota Statutes Chapter 363A, within fifteen (15) calendar days of your signing this Agreement, and with regard to your rights arising under the federal Age Discrimination in Employment Act, 29 U.S.C. § 621 etseq., within seven (7) calendar days of your signing this Agreement. The two rescission periods shall run concurrently. In order to be effective, the rescission must (a) be in writing; (b) delivered to Steve Rempe, Chief Human Resources Officer, 1225 Old Highway 8 NW, St. Paul, MN 55112, by mail or email within the required period; and (c) if delivered by mail, the rescission must be postmarked within the required period, properly addressed to Steve Rempe as set forth above, and sent by certified mail, return receipt requested. You understand and agree that if you rescind any part of this Agreement in accordance with this Section 5, CSI will have no obligation to provide you the pay and benefits described in Section 2 of this Agreement and you will be obligated to return to CSI any pay and benefits already received in connection with Section 2 of this Agreement.

6.Return of Property. You acknowledge and agree that all documents and materials relating to the business of, or the services provided by, CSI are the sole property of CSI. You agree and represent that you have returned to CSI all of its property, including but not limited to, all

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medical device and other equipment, computers and related hardware, customer records and other documents and materials, whether on computer disc, hard drive or other form, and all copies thereof, within your possession or control, which in any manner relate to the business of, or the duties and services you performed on behalf of CSI. You agree that if after the Separation Date you discover additional CSI information or property in your possession you will promptly notify and return it to CSI.

7.Ongoing Obligations Under Your Employment Agreement. You are hereby reminded of your ongoing obligations to CSI under Paragraphs 9 – 13 of your Employment Agreement with CSI. Nothing in this Agreement or elsewhere is intended to or will be used in any way to prevent disclosure of confidential information in accordance with the immunity provisions set forth in Section 7 of the Defend Trade Secrets Act of 2016 (18 U.S.C. § 1833(b)), meaning disclosure (i) in confidence to a government official or attorney solely for the purpose of reporting or investigating a suspected legal violation; or (ii) under seal in connection with a lawsuit (including an anti-retaliation lawsuit).

8.Cooperation. You agree that through the twelve (12) month anniversary of the Separation Date, you will respond in a timely and helpful manner via telephone or email to CSI’s questions regarding your employment with CSI, such as, but not limited to, status of projects, customer matters, location of data, passwords, etc. In addition, you agree that you will cooperate and assist in the orderly transition of files and other information related to your work with CSI and, upon request, provide your assistance, knowledge, and expertise to CSI to address any problems or issues that may arise. You further agree that you will cooperate with CSI to respond to, defend, or address all claims, charges, complaints or litigation by or against CSI that has arisen or that may arise with respect to omissions, acts, transactions or other events that occurred during your employment with CSI. You also agree that you will provide truthful and accurate sworn testimony in the form of deposition, affidavit, and/or court testimony if requested by CSI. CSI will reimburse you for reasonable out-of-pocket expenses incurred as a result of your assistance unless such remuneration would be inappropriate or otherwise prohibited under the law.

9.Non-Disparagement and Confidentiality. You promise and agree not to disparage CSI, its directors, officers, shareholders, employees, products or services, and CSI agrees to instruct its Executive level employees as of the Separation Date not to disparage you. You further promise and agree not to disclose or discuss, directly or indirectly, in any manner whatsoever, any information regarding either (1) the contents and terms of this Agreement, or (2) the substance and/or nature of any dispute between CSI and any employee or former employee, including yourself. Notwithstanding the foregoing, nothing in this Section 9 or this Agreement shall prohibit or limit you from discussing or disclosing this confidential information with or to your legal and financial advisors and your spouse, if applicable, provided they agree to keep the information confidential, or from freely and truthfully communicating with, with or without notice to CSI, federal and state tax authorities, the state unemployment compensation department, other government agencies, or as otherwise required or allowed by law.

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10.Code Section 409A. It is intended that any amounts payable under the Agreement shall be exempt from or comply with the applicable requirements, if any, of Section 409A of the Internal Revenue Code of 1986, as amended, and the notices, regulations and other guidance of general applicability issued thereunder (“Code Section 409A”), and the parties will interpret the Agreement in a manner that will preclude the imposition of additional taxes and interest imposed under Code Section 409A. Any payments under this Agreement that may be excluded from Code Section 409A either as separation pay due to an involuntary separation from service or as a short-term deferral will be so excluded to the maximum extent possible. This Agreement may be amended (as mutually determined by the parties) to the extent necessary to comply with Code Section 409A.

11.Remedies. If either party breaches any term of this Agreement, if you breach any of the specific paragraphs of your Employment Agreement referenced in this Agreement, or if either party breaches any other written agreement in effect between you and CSI, the prevailing party in any enforcement action as determined by a court of competent jurisdiction shall be entitled to its available legal and equitable remedies, including but not limited to, in the case of your breach, CSI suspending and recovering any and all payments and benefits made or to be made under Section 2 of this Agreement, and payment by the non-prevailing party of the prevailing party’s attorneys’ fees and costs incurred in connection with such action. If either party seeks and/or obtains relief from an alleged breach of this Agreement, all of the provisions of this Agreement shall remain in full force and effect.

12.Non-Admission. It is expressly understood that this Agreement does not constitute, nor shall it be construed as, an admission by CSI or you of any liability or unlawful conduct whatsoever. CSI and you specifically deny any liability or unlawful conduct.Additionally, by signing this Agreement you acknowledge and agree that you are not aware, to the best of your knowledge, of any conduct, on your part or on the part of another employee at CSI, that violated CSI’s code of conduct, applicable policies and procedures, or applicable law or otherwise exposed CSI to any liability, whether criminal or civil, and whether to any government, individual or other entity. Further, you acknowledge and agree that you are not aware of any material violations by CSI and/or any of the Released Parties or employees of CSI of any statute, regulation or other rules that have not been addressed by CSI through appropriate compliance and/or corrective action.

13.Successors and Assigns. This Agreement is personal to you and may not be assigned by you without the written agreement of CSI. The rights and obligations of this Agreement shall inure to the successors and assigns of CSI.

14.Enforceability. If a court finds any term of this Agreement to be invalid, unenforceable, or void, the parties agree that the court shall modify such term to make it enforceable

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to the maximum extent possible. If the term cannot be modified, the parties agree that the term shall be severed and all other terms of this Agreement shall remain in effect.

15.Law, Jurisdiction and Venue, Jury Trial Waiver.This Agreement will be construed and interpreted in accordance with, and any dispute or controversy arising from any breach or asserted breach of this Agreement will be governed by, the laws of the State of Minnesota, without regard to any choice of law rules.Any action brought to enforce or interpret this Agreement must be brought in the state or federal courts for the State of Minnesota sitting in Hennepin County, Minnesota, and the parties hereby consent to the jurisdiction and venue of such courts in the event of any dispute.Each of the parties knowingly and voluntarily waives all right to trial by jury in any action or proceeding arising out of or relating to this Agreement or for recognition or enforcement of any judgment.

16.Full Agreement. This Agreement contains the full agreement between you and CSI and may not be modified, altered, or changed in any way except by written agreement signed by both parties. The parties agree that this Agreement supersedes and terminates any and all other written and oral agreements and understandings between the parties, except for Sections 9 - 14 of your Employment Agreement; any agreements regarding your restricted stock awards (as modified in Section 2 above); the Indemnification Agreement; and any other written agreement in effect between you and CSI containing post-employment obligations, which shall continue in full force and effect according to their terms and shall survive the termination of your employment.

17.Counterparts. This Agreement may be executed by facsimile or electronic transmission and in counterparts, each of which shall be deemed an original and all of which shall constitute one instrument.

18.Acknowledgment of Reading and Understanding. By signing this Agreement, you acknowledge that you have read this Agreement, including the release of claims contained in Section 3, and understand that the release of claims is a full and final release of all claims you may have against CSI and the other entities and individuals covered by the release. By signing, you also acknowledge and agree that you have entered into this Agreement knowingly and voluntarily, and that CSI has informed you that you have the right to consult with an attorney of your choice prior to signing this Agreement.

As noted above, you may not sign this Agreement until March 3, 2022. The deadline for you to accept this Agreement is 5:00 p.m. March 21, 2022, which is 21 calendar days following your receipt of this Agreement not including the date of receipt (the “Offer Expiration”). If not accepted by the Offer Expiration, the offer contained herein will expire. After you have reviewed this Agreement and obtained whatever advice and counsel you consider appropriate regarding it, please evidence your agreement to the provisions set forth in this Agreement by dating and signing the Agreement. Please then return a signed Agreement to me no later than the Offer Expiration. Please keep a copy for your records.

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Ryan, on behalf of CSI, we thank you for your service and wish you all the best.

Sincerely,

/s/ Steve Rempe

Steve Rempe

Chief Human Resources Officer

ACKNOWLEDGMENT AND SIGNATURE

By signing below, I, Ryan Egeland, acknowledge and agree to the following:

•I have had adequate time to consider whether to sign this Separation Agreement and Release.

•I have read this Separation Agreement and Release carefully.

•I understand and agree to all of the terms of the Separation Agreement and Release.

•I am knowingly and voluntarily releasing my claims against CSI and the other persons and entities defined as the Released Parties.

•I have not, in signing this Agreement, relied upon any statements or explanations made by CSI except as for those specifically set forth in this Separation Agreement and Release.

•I intend this Separation Agreement and Release to be legally binding.

•I am signing this Separation Agreement and Release on or after my last day of employment with CSI.

Accepted this 3rd day of March, 2022.

 /s/ Ryan Egeland

Ryan Egeland

EX-10.3

Exhibit 10.3

SECOND AMENDMENT

TO

LOAN AND SECURITY AGREEMENT

This Second Amendment to Loan and Security Agreement (this“Amendment”) is entered into this 29th day of March, 2022, by and between SILICON VALLEY BANK, a California corporation (“Bank”) and CARDIOVASCULAR SYSTEMS, INC., a Delaware corporation (“Borrower”).

Recitals

A.    Bank and Borrower have entered into that certain Loan and Security Agreement dated as of March 31, 2017, as amended by that certain First Amendment to Loan and Security dated as of March 26, 2020 (as the same may from time to time be further amended, modified, supplemented or restated, the “Loan Agreement”).

B.    Bank has extended credit to Borrower for the purposes permitted in the Loan Agreement.

C.    Borrower has requested that Bank amend the Loan Agreement to make certain revisions to the Loan Agreement as more fully set forth herein.

D.    Bank has agreed to so amend certain provisions of the Loan Agreement, but only to the extent, in accordance with the terms, subject to the conditions and in reliance upon the representations and warranties set forth below.

Agreement

    Now, Therefore, in consideration of the foregoing recitals and other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, and intending to be legally bound, the parties hereto agree as follows:

1.Definitions. Capitalized terms used but not defined in this Amendment shall have the meanings given to them in the Loan Agreement.

2.Amendments to Loan Agreement.

2.1Section 2.4 (Interest Rate).Subsection (a) of Section 2.4 is deleted in its entirety and replaced with the following:

“    (a)    Interest Rate. Subject to Section 2.4(b), the principal amount outstanding under the Revolving Line shall accrue interest at a floating per annum rate equal to the greater of (i) zero percent (0.00%) and (ii) Prime Rate minus three quarters of one percent (0.75%), which interest rate shall be payable monthly in accordance with Section 2.4(d) below.”

2.2Section 2.5 (Fees).Subsection (b) of Section 2.5 is deleted in its entirety and replaced with the following:

“    (b)    Termination Fee. Upon termination of this Agreement or the termination of the Revolving Line for any reason prior to the date that is fifteen (15) days prior to the Revolving Line Maturity Date, in addition to the payment of any other amounts then-owing, a termination fee in an amount equal to one and one half of one percent (1.50%) of the Revolving Line; providedthat no termination fee shall be charged if the credit facility hereunder is replaced with a new facility from Bank;”

2.3Section 6.2 (Financial Statements, Reports, Certificates).Subsection (b) of Section 6.2 is deleted in its entirety and replaced with the following:

“(b)    Account Receivable/Accounts Payable Reports. For any month in which Obligations were outstanding under the Revolving Line, within thirty (30) days after the end of such month, (A) monthly accounts receivable agings, aged by invoice date, (B) monthly accounts payable agings, aged by invoice date, and outstanding or held check registers, if any, and (C) monthly reconciliations of accounts receivable agings (aged by invoice date), transaction reports, Deferred Revenue report, and general ledger;”

2.4Section 13 (Definitions). The following terms and their respective definitions set forth in Section 13.1 are deleted in their entirety and replaced with the following:

“    “Revolving Line Maturity Date” is March 31, 2023.”

2.5Exhibit B (Compliance Certificate). The Compliance Certificate appearing as Exhibit B to the Loan Agreement is deleted in its entirety and replaced with the Compliance Certificate attached as Schedule 1 attached hereto.

3.Limitation of Amendments.

3.1Subject to Section 5 hereof, the amendments set forth in Section 2, above, are effective for the purposes set forth herein and shall be limited precisely as written and shall not be deemed to (a) be a consent to any amendment, waiver or modification of any other term or condition of any Loan Document, or (b) otherwise prejudice any right or remedy which Bank may now have or may have in the future under or in connection with any Loan Document.

3.2This Amendment shall be construed in connection with and as part of the Loan Documents and all terms, conditions, representations, warranties, covenants and agreements set forth in the Loan Documents, except as herein amended (including, without limitation, pursuant to the Updated Perfection Certificate), are hereby ratified and confirmed and shall remain in full force and effect.

4.Representations and Warranties. To induce Bank to enter into this Amendment, Borrower hereby represents and warrants to Bank as follows:

4.1Immediately after giving effect to this Amendment (a) the representations and warranties contained in the Loan Documents are true, accurate and complete in all material respects as of the date hereof (except to the extent such representations and warranties relate to an earlier date, in which case they are true and correct as of such date), and (b) no Event of Default has occurred and is continuing;

4.2Borrower has the power and authority to execute and deliver this Amendment and to perform its obligations under the Loan Agreement, as amended by this Amendment;

4.3The organizational documents of Borrower delivered to Bank on the Effective Date remain true, accurate and complete and have not been amended, supplemented or restated and are and continue to be in full force and effect;

4.4The execution and delivery by Borrower of this Amendment and the performance by Borrower of its obligations under the Loan Agreement, as amended by this Amendment, have been duly authorized;

4.5The execution and delivery by Borrower of this Amendment and the performance by Borrower of its obligations under the Loan Agreement, as amended by this Amendment, do not and will not contravene (a) any law or regulation binding on or affecting Borrower, (b) any contractual restriction with a Person binding on Borrower, (c) any order, judgment or decree of any court or other governmental or public body or authority, or subdivision thereof, binding on Borrower, or (d) the organizational documents of Borrower;

4.6The execution and delivery by Borrower of this Amendment and the performance by Borrower of its obligations under the Loan Agreement, as amended by this Amendment, do not require any order, consent, approval, license, authorization or validation of, or filing, recording or registration with, or exemption by any governmental or public body or authority, or subdivision thereof, binding on Borrower, except as already has been obtained or made; and

4.7This Amendment has been duly executed and delivered by Borrower and is the binding obligation of Borrower, enforceable against Borrower in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, liquidation, moratorium or other similar laws of general application and equitable principles relating to or affecting creditors’ rights.

5.Updated Perfection Certificate. Borrower has delivered an updated Perfection Certificate dated as of March 29, 2022 (the “Updated Perfection Certificate”), which Updated Perfection Certificate shall supersede in all respects that certain Perfection Certificate dated as of March 26, 2020 delivered by Borrower to Bank. Borrower and Bank acknowledge and agree that all references in the Loan Agreement to the “Perfection Certificate” or the Perfection Certificate as existing on the Effective Date shall hereinafter be deemed to be a reference to the Updated Perfection Certificate as existing as of the date hereof. Bank acknowledges that the Updated Perfection Certificate references events to occur after the date hereof and that such events shall be permitted under the Loan Agreement as of the date or dates such events occur.

6.Integration. This Amendment and the Loan Documents represent the entire agreement about this subject matter and supersede prior negotiations or agreements. All prior agreements, understandings, representations, warranties, and negotiations between the parties about the subject matter of this Amendment and the Loan Documents merge into this Amendment and the Loan Documents.

7.Counterparts. This Amendment may be executed in any number of counterparts and all of such counterparts taken together shall be deemed to constitute one and the same instrument.

8.Right of Set-Off. In consideration of Bank’s agreement to enter into this Amendment, Borrower hereby reaffirms and hereby grants to Bank, a lien, security interest and right of set off as security for all Obligations to Bank, whether now existing or hereafter arising upon and against all deposits, credits, collateral and property, now or hereafter in the possession, custody, safekeeping or control of Bank or any entity under the control of Bank (including a Bank subsidiary) or in transit to any of them. At any time after the occurrence and during the continuance of an Event of Default, without demand or notice, Bank may set off the same or any part thereof and apply the same to any liability or obligation of Borrower even though unmatured and regardless of the adequacy of any other collateral securing the loan. ANY AND ALL RIGHTS TO REQUIRE BANK TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER COLLATERAL WHICH SECURES THE OBLIGATIONS, PRIOR TO EXERCISING ITS RIGHT OF SETOFF WITH RESPECT TO SUCH DEPOSITS, CREDITS OR OTHER PROPERTY OF BORROWER, ARE HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED.

9.Effectiveness. As a condition precedent to the effectiveness of this Amendment and the Bank’s obligation to make further Advances under the Revolving Line, Bank shall have received the following documents prior to or concurrently with this Amendment, each in form and substance reasonably satisfactory to Bank:

9.1this Amendment and the Updated Perfection Certificate duly executed on behalf of Borrower;

9.2a good standing certificate of Borrower, certified by the jurisdiction of formation of Borrower, dated as of a date no earlier than thirty (30) days prior to the date hereof;

9.3certified copies, dated as of a recent date, of financing statement and other lien searches of Borrower, which shall be obtained by Bank, accompanied by written evidence (including any Uniform Commercial Code termination statements) that the Liens revealed in any such searched either (i) will be terminated prior to or in connection with this Amendment, or (ii) will constitute Permitted Liens;

9.4evidence reasonably satisfactory to Bank that the insurance policies required pursuant to Section 6.7 of the Loan Agreement are in full force and effect;

9.5Borrower’s payment of Bank’s reasonable and documented legal fees and expenses incurred in connection with this Amendment;

9.6evidence reasonably satisfactory to Bank that the insurance endorsements required by Section 6.7 of the Loan Agreement are in full force and effect; and

9.7such other documents as Bank may reasonably request to effectuate the terms of this Amendment.

10.Audit. Prior to the first Advance after the date hereof, Bank shall conduct an inspection of Borrower’s Accounts, the Collateral, and Borrower’s Books, with results satisfactory to Bank in its sole and absolute discretion.

11.Post-Closing Requirement. Within sixty (60) days after the date hereof or such later date as approved by Bank, Borrower shall deliver or cause to be delivered to Bank a duly executed Securities Account Control Agreement with SVB Asset Management and U.S. Bank, N.A. Failure to comply with the foregoing requirement within the time period noted shall constitute an Event of Default for which no grace or cure period shall apply.

[Signature page follows.]

In Witness Whereof, the parties hereto have caused this Amendment to be duly executed and delivered as of the date first written above.

BANK		BORROWER
SILICON VALLEY BANK		CARDIOVASCULAR SYSTEMS, INC.
By:	/s/ Brian Powers	By:	/s/ Jeffrey Points
Name:	Brian Powers	Name:	Jeffrey Points
Title:	Director	Title:	Chief Financial Officer

1

Schedule 1

EXHIBIT B

COMPLIANCE CERTIFICATE

TO:    SILICON VALLEY BANK                Date:

FROM: CARDIOVASCULAR SYSTEMS, INC.

The undersigned authorized officer of Cardiovascular Systems, Inc. (“Borrower”) certifies that under the terms and conditions of the Loan and Security Agreement between Borrower and Bank (the “Agreement”), (1) Borrower is in complete compliance for the period ending _______________ with all required covenants except as noted below, (2) there are no Events of Default, (3) all representations and warranties in the Agreement are true and correct in all material respects on this date except as noted below; provided, however, that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof; and provided, further that those representations and warranties expressly referring to a specific date shall be true, accurate and complete in all material respects as of such date, (4) Borrower, and each of its Subsidiaries, has timely filed all required tax returns and reports, and Borrower has timely paid all foreign, federal, state and local taxes, assessments, deposits and contributions owed by Borrower except as otherwise permitted pursuant to the terms of Section 5.9 of the Agreement, and (5) no Liens have been levied or claims made against Borrower or any of its Subsidiaries, if any, relating to unpaid employee payroll or benefits of which Borrower has not previously provided written notification to Bank. Attached are the required documents supporting the certification. The undersigned certifies that these are prepared in accordance with GAAP consistently applied from one period to the next except as explained in an accompanying letter or footnotes. The undersigned acknowledges that no borrowings may be requested at any time or date of determination that Borrower is not in compliance with any of the terms of the Agreement, and that compliance is determined not just at the date this certificate is delivered. Capitalized terms used but not otherwise defined herein shall have the meanings given them in the Agreement.

Please indicate compliance status by circling Yes/No under “Complies” column.
Reporting Covenants	Required				Complies
Monthly financial statements with Compliance Certificate*	Monthly within 30 days				Yes No
Quarterly financial statements with Compliance Certificate	Quarterly within 30 days				Yes No
Annual financial statements (CPA Audited) + CC	FYE within 120 days				Yes No
10-Q, 10-K and 8-K	Within 5 days after filing with SEC				Yes No N/A
A/R & A/P Agings, Deferred Revenue reports*	Monthly within 30 days				Yes No
Borrowing Base Reports*	Monthly within 30 days				Yes No
Board approved projections	FYE within 30 days				Yes No
Financial Covenants**		Required	Actual	Complies
Minimum Liquidity; or		$10,000,000	$	Yes No
Minimum Adjusted EBITDA		$1,000,000	$	Yes No

    *For any month in which Obligations were outstanding under the Revolving Line

**Tested when there are Obligations outstanding and prior to each Advance

Streamline Period	Applies
Adjusted Quick Ratio > 1.25:1.00	Yes No

2

The following financial covenant analyses and information set forth in Schedule 1 attached hereto are true and accurate as of the date of this Certificate.

The following are the exceptions with respect to the certification above: (If no exceptions exist, state “No exceptions to note.”)

---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Cardiovascular Systems, Inc.	BANK USE ONLY
	Received by:
		AUTHORIZED SIGNER
By:
Name:	Date:
Title:	Verified:
		AUTHORIZED SIGNER
	Date:
	Compliance Status:	Yes No

3

SCHEDULE 1 TO COMPLIANCE CERTIFICATE

FINANCIAL COVENANTS OF BORROWER

In the event of a conflict between this Schedule and the Loan Agreement, the terms of the Loan Agreement shall govern.

I.    Minimum Liquidity (Section 6.9(a))

Required:    Borrower shall maintain Liquidity (assuming that a Streamline Period is not in effect for purposes of calculating the Availability Amount) at all times, to be certified to Bank as of the last day of each month (or, if being measured in connection with the making of an Advance, calculated immediately prior to the making of such Advance) of at least Ten Million Dollars ($10,000,000).

Actual:    

A.	Unrestricted cash and Cash Equivalents of Borrower maintained at Bank or Bank’s Affiliates	$________
B.	Availability Amount	$________
C.	Liquidity (line A plus line B)	$________

Is line C equal to or greater than $10,000,000?

  No, not in compliance                      Yes, in compliance

4

II.    Minimum Adjusted EBITDA (Section 6.9(b))

Required:    Borrower shall achieve, measured on a trailing three (3) month basis as of the last day of each month (or, if being measured in connection with the making of an Advance, calculated as of the last day of the month immediately preceding the request for such Advance), Adjusted EBITDA of at least One Million Dollars ($1,000,000).

Actual:    

A.	Net Income	$________
B.	To the extent included in the determination of Net Income
	1.    The provision for income taxes	$________
	2.    Depreciation expense	$________
	3.    Amortization expense	$________
	4.    Interest Expense	$________
	5.    Non-cash stock compensation expense	$________
	6.    The sum of lines 1 through 5	$________
C.	Unfinanced Capital Expenditures	$________
D.	Adjusted EBITDA (line A plus line B minus line C)	$________

Is line D equal to or greater than $1,000,000?

  No, not in compliance                      Yes, in compliance

1

FOR PURPOSES OF THE STREAMLINE PERIOD AND CALCULATING THE ADJUSTED QUICK RATIO

Adjusted Quick Ratio

Required:    1.25:1.00

Actual:

A.	Aggregate value of the unrestricted and unencumbered cash and Cash Equivalents of Borrower maintained with Bank or Bank’s Affiliates	$________
B.	Aggregate value of the net billed accounts receivable of Borrower	$________
C.	Quick Assets (the sum of line A plus line B)	$________
D.	Aggregate value of Obligations to Bank	$________
E.	Without duplication of line D, the aggregate value of liabilities of Borrower (including all Indebtedness) that matures within one (1) year	$________
F.	Current Liabilities (the sum of line D plus line E)	$________
G.	Aggregate value of all amounts received or invoiced by Borrower in advance of performance under contracts and not yet recognized as revenue	$________
H.	Line F minus line G	$________
I.	Adjusted Quick Ratio (line C divided by line H)

Is line I equal to or greater than 1.25:1:00?

  No, Streamline Period not in effect              Yes, Streamline Period in effect

2

EX-31.1

Exhibit 31.1

CERTIFICATION UNDER SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Scott R. Ward, certify that:

1.    I have reviewed this quarterly report on Form 10-Q of Cardiovascular Systems, Inc.;

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.    The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)        Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)        Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)        Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)        Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.    The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)        All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)        Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ Scott R. Ward

Scott R. Ward
Chairman, President and Chief Executive Officer

Dated: May 5, 2022

EX-31.2

Exhibit 31.2

CERTIFICATION UNDER SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Jeffrey S. Points, certify that:

1.    I have reviewed this quarterly report on Form 10-Q of Cardiovascular Systems, Inc.;

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.    The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)        Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)        Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)        Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)        Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.    The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)        All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)        Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ Jeffrey S. Points

Jeffrey S. Points
Chief Financial Officer

Dated: May 5, 2022

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED

PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the filing of the Quarterly Report on Form 10-Q for the quarter ended March 31, 2022 (the “Report”) by Cardiovascular Systems, Inc. (“Registrant”), I, Scott R. Ward, the Chief Executive Officer of the Company, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that to the best of my knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

/s/ Scott R. Ward

Scott R. Ward
Chairman, President and Chief Executive Officer

Dated: May 5, 2022

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED

PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the filing of the Quarterly Report on Form 10-Q for the quarter ended March 31, 2022 (the “Report”) by Cardiovascular Systems, Inc. (“Registrant”), I, Jeffrey S. Points, the Chief Financial Officer of the Company, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that to the best of my knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

/s/ Jeffrey S. Points

Jeffrey S. Points
Chief Financial Officer

Dated: May 5, 2022

XML

Document and Entity Information - shares	9 Months Ended
	Mar. 31, 2022	May 02, 2022
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2022
Document Transition Report	false
Amendment Flag	false
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q3
Entity File Number	000-52082
Entity Registrant Name	CARDIOVASCULAR SYSTEMS, INC.
Entity Incorporation, State or Country Code	DE
Entity Central Index Key	0001180145
Current Fiscal Year End Date	--06-30
Entity Tax Identification Number	41-1698056
Entity Address, Address Line One	1225 Old Highway 8 Northwest
Entity Address, City or Town	St. Paul
Entity Address, State or Province	MN
Entity Address, Postal Zip Code	55112-6416
City Area Code	651
Local Phone Number	259-1600
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Title of 12(b) Security	Common Stock, One-tenth of One Cent ($0.001) Par Value Per Share
Trading Symbol	CSII
Security Exchange Name	NASDAQ
Entity Common Stock, Shares Outstanding		40,785,123

XML

Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Mar. 31, 2022	Jun. 30, 2021
Current assets
Cash and cash equivalents	$ 66,953	$ 71,070
Marketable securities	105,098	135,968
Accounts receivable, net	34,666	40,033
Inventories	32,854	32,313
Prepaid expenses and other current assets	5,742	5,285
Total current assets	245,313	284,669
Property and equipment, net	29,097	28,894
Intangible assets, net	16,080	15,376
Strategic investments	30,733	20,657
Other assets	2,768	2,971
Total assets	323,991	352,567
Current liabilities
Accounts payable	13,598	14,061
Accrued expenses	30,011	38,189
Deferred revenue	2,812	2,400
Total current liabilities	46,421	54,650
Long-term liabilities
Financing obligation	20,385	20,596
Deferred revenue	0	2,194
Other liabilities	3,687	4,169
Total liabilities	70,493	81,609
Commitments and contingencies (see Note 10)
Common stock, $0.001 par value; authorized 100,000,000 common shares; issued and outstanding 40,784,179 at March 31, 2022 and 40,215,554 at June 30, 2021, respectively	39	39
Additional paid in capital	667,552	652,288
Accumulated other comprehensive income	(212)	11
Accumulated deficit	(413,881)	(381,380)
Total stockholders’ equity	253,498	270,958
Total liabilities and stockholders’ equity	$ 323,991	$ 352,567

XML

Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares	Mar. 31, 2022	Jun. 30, 2021
Statement of Financial Position [Abstract]
Common stock, par value (in usd per share)	$ 0.001	$ 0.001
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	40,784,179	40,215,554
Common stock, shares outstanding	40,784,179	40,215,554

XML

Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Mar. 31, 2022	Mar. 31, 2021
Income Statement [Abstract]
Net revenues	$ 56,221	$ 63,273	$ 173,726	$ 187,986
Cost of goods sold	14,790	14,013	47,171	40,497
Gross profit	41,431	49,260	126,555	147,489
Expenses:
Selling, general and administrative	41,680	41,442	123,933	121,785
Research and development	9,052	13,163	27,947	31,816
Amortization of intangible assets	346	304	996	912
Total expenses	51,078	54,909	152,876	154,513
Loss from operations	(9,647)	(5,649)	(26,321)	(7,024)
Interest expense	408	412	1,227	1,323
Interest income and other, net	(460)	(120)	(567)	(400)
Total other (income) expense, net	(52)	292	660	923
Loss before income taxes	(9,595)	(5,941)	(26,981)	(7,947)
Provision for income taxes	63	63	262	189
Net loss	$ (9,658)	$ (6,004)	$ (27,243)	$ (8,136)
Basic earnings per share	$ (0.25)	$ (0.15)	$ (0.70)	$ (0.21)
Diluted earnings per share	$ (0.25)	$ (0.15)	$ (0.70)	$ (0.21)
Basic weighted average shares outstanding	39,287,632	38,911,454	39,190,865	38,800,622
Diluted weighted average shares outstanding	39,287,632	38,911,454	39,190,865	38,800,622

XML

Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Mar. 31, 2022	Mar. 31, 2021
Statement of Comprehensive Income [Abstract]
Net loss	$ (9,658)	$ (6,004)	$ (27,243)	$ (8,136)
Other comprehensive loss:
Unrealized loss on available-for-sale debt securities	(154)	(72)	(223)	(226)
Comprehensive Income (Loss), Net of Tax, Attributable to Parent, Total	$ (9,812)	$ (6,076)	$ (27,466)	$ (8,362)

XML

Consolidated Statements of Changes in Stockholders' Equity (Unaudited) Statement - USD ($) $ in Thousands	Total	Common Stock	Additional Paid  In Capital	Accumulated Other Comprehensive Income (Loss)	Accumulated Deficit
Beginning balance, value at Jun. 30, 2020	$ 268,792	$ 39	$ 631,559	$ 269	$ (363,075)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation related to restricted stock awards, net	4,836	0	4,836	0	0
Shares withheld for payroll taxes	(3,410)	0	0	0	3,410
Employee stock purchase plan activity	332	0	332	0	0
Unrealized loss on available-for-sale debt securities	(69)	0	0	(69)	0
Net loss	(2,076)	0	0	0	(2,076)
Ending balance, value at Sep. 30, 2020	268,405	39	636,727	200	(368,561)
Beginning balance, value at Jun. 30, 2020	268,792	39	631,559	269	(363,075)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Unrealized loss on available-for-sale debt securities	(226)
Net loss	(8,136)
Ending balance, value at Mar. 31, 2021	270,451	39	646,406	43	(376,037)
Beginning balance, value at Sep. 30, 2020	268,405	39	636,727	200	(368,561)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation related to restricted stock awards, net	3,545	0	3,545	0	0
Shares withheld for payroll taxes	(407)	0	0	0	407
Employee stock purchase plan activity	2,430	0	2,430	0	0
Unrealized loss on available-for-sale debt securities	(85)	0	0	(85)	0
Net loss	(56)	0	0	0	(56)
Ending balance, value at Dec. 31, 2020	273,832	39	642,702	115	(369,024)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation related to restricted stock awards, net	3,332	0	3,332	0	0
Shares withheld for payroll taxes	(1,009)	0	0	0	(1,009)
Employee stock purchase plan activity	372	0	372	0	0
Unrealized loss on available-for-sale debt securities	(72)			(72)
Net loss	(6,004)	0	0	0	(6,004)
Ending balance, value at Mar. 31, 2021	270,451	39	646,406	43	(376,037)
Beginning balance, value at Jun. 30, 2021	270,958	39	652,288	11	(381,380)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation related to restricted stock awards, net	5,523	0	5,523	0	0
Shares withheld for payroll taxes	(4,990)	0	0	0	(4,990)
Employee stock purchase plan activity	324	0	324	0	0
Unrealized loss on available-for-sale debt securities	(17)	0	0	(17)	0
Exercise of stock options	12	0	12	0	0
Net loss	(8,618)	0	0	0	(8,618)
Ending balance, value at Sep. 30, 2021	263,192	39	658,147	(6)	(394,988)
Beginning balance, value at Jun. 30, 2021	270,958	39	652,288	11	(381,380)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Unrealized loss on available-for-sale debt securities	(223)
Net loss	(27,243)
Ending balance, value at Mar. 31, 2022	253,498	39	667,552	(212)	(413,881)
Beginning balance, value at Sep. 30, 2021	263,192	39	658,147	(6)	(394,988)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation related to restricted stock awards, net	3,659	0	3,659	0	0
Shares withheld for payroll taxes	(161)	0	0	0	(161)
Employee stock purchase plan activity	1,854	0	1,854		0
Unrealized loss on available-for-sale debt securities	(52)	0	0	(52)	0
Net loss	(8,967)	0	0	0	(8,967)
Ending balance, value at Dec. 31, 2021	259,525	39	663,660	(58)	(404,116)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation related to restricted stock awards, net	3,538	0	3,538	0	0
Shares withheld for payroll taxes	(107)				107
Employee stock purchase plan activity	354		354
Unrealized loss on available-for-sale debt securities	(154)	0	0	(154)	0
Net loss	(9,658)	0	0	0	(9,658)
Ending balance, value at Mar. 31, 2022	$ 253,498	$ 39	$ 667,552	$ (212)	$ (413,881)

XML

Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Cash flows from operating activities
Net loss	$ (27,243)	$ (8,136)
Adjustments to reconcile net loss to net cash from operating activities
Depreciation of property and equipment	2,835	2,231
Amortization of intangible assets	996	912
Stock-based compensation	13,804	12,488
Charges incurred in connection with acquired IPR&D		3,353
Provision for doubtful accounts	50
(Gain) loss on disposal of equipment	(15)	138
Amortization of premium (accretion of discount) on marketable securities	(1,106)	(1,026)
Other	(402)	0
Changes in assets and liabilities
Accounts receivable	5,317	(12,844)
Inventories	(541)	(5,661)
Prepaid expenses and other assets	467	425
Accounts payable	(266)	1,147
Accrued expenses and other liabilities	(8,769)	3,910
Deferred revenue	(1,782)	(1,409)
Net cash used in operating activities	(14,443)	(2,420)
Cash flows from investing activities
Purchases of property and equipment	(3,220)	(2,758)
Acquisitions	(1,700)	(3,353)
Investments in strategic ventures	(9,674)	(8,374)
Purchases of marketable securities	(85,076)	(156,628)
Sales of marketable securities	13,692	4,885
Maturities of marketable securities	100,462	61,350
Net cash provided by (used in) investing activities	14,484	(104,878)
Cash flows from financing activities
Proceeds from employee stock purchase plan	1,242	2,098
Payments of employee taxes related to vested restricted stock	(5,258)	(4,826)
Exercise of stock options	12	0
Principal payments made on financing obligation	(154)	(104)
Net cash used in financing activities	(4,158)	(2,832)
Net change in cash and cash equivalents	(4,117)	(110,130)
Cash and cash equivalents
Beginning of period	71,070	185,463
End of period	$ 66,953	$ 75,333

XML

Basis of Presentation

9 Months Ended

Mar. 31, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

1. Basis of Presentation

Cardiovascular Systems, Inc. (the “Company”), based in St. Paul, Minnesota, is a medical device company focused on developing and commercializing innovative solutions for treating vascular and coronary disease. The Company’s Orbital Atherectomy Systems (“OAS”) treat calcified and fibrotic plaque in arterial vessels throughout the leg and heart in a few minutes of treatment time, and address many of the limitations associated with existing surgical, catheter and pharmacological treatment alternatives. 

The Company prepared the unaudited interim consolidated financial statements and related unaudited financial information in the footnotes in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial statements. The year-end consolidated balance sheet was derived from the Company’s audited consolidated financial statements, but does not include all disclosures as required by GAAP. These interim consolidated financial statements reflect all adjustments consisting of normal recurring accruals, which, in the opinion of management, are necessary for a fair statement of the Company’s consolidated financial position, the results of its operations, its changes in stockholders’ equity, and its cash flows for the interim periods. Certain amounts in the prior years' consolidated financial statements have been reclassified to conform to the current year presentation. These interim consolidated financial statements should be read in conjunction with the consolidated annual financial statements and the notes thereto included in the Company's Annual Report on Form 10-K for the year ended June 30, 2021. The nature of the Company’s business is such that the results of any interim period may not be indicative of the results to be expected for the entire year.

The preparation of the Company’s consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company has been impacted by the COVID-19 pandemic. The full extent to which the COVID-19 pandemic will directly or indirectly impact the Company's business, results of operations and financial condition, including sales, expenses, reserves and allowances, manufacturing, clinical trials, research and development costs and employee-related amounts, will depend on future developments that are highly uncertain, including as a result of new information that may emerge concerning COVID-19 and the actions taken to contain or treat COVID-19, as well as the economic impact on the Company's customers and markets. The Company has made estimates of the impact of COVID-19 within these consolidated financial statements and there may be changes to those estimates in future periods. Actual results could differ from those estimates.

XML

Selected Consolidated Financial Statement Information

9 Months Ended

Mar. 31, 2022

Quarterly Financial Information Disclosure [Abstract]

Selected Consolidated Financial Statement Information

2. Selected Consolidated Financial Statement Information

Accounts Receivable, Net

Accounts receivable consists of the following:

	March 31,		June 30,
	2022		2021
Accounts receivable	$	35,871	$	41,634
Less: Allowance for doubtful accounts	(1,205)		(1,601)
Accounts receivable, net	$	34,666	$	40,033

Inventories

Inventories consist of the following:

	March 31,		June 30,
	2022		2021
Raw materials	$	12,337	$	11,621
Work in process	3,781		3,469
Finished goods	16,736		17,223
Inventories	$	32,854	$	32,313

WIRION Recall

In November 2021, the Company initiated a voluntary recall of unused WIRION embolic protection systems. In connection with the recall, the Company recorded a reserve for approximately $2,849 during the nine months ended March 31, 2022, which amount represents inventory that has no future intended use.

Property and Equipment, Net

Property and equipment consists of the following:

	March 31,		June 30,
	2022		2021
Land	$	572	$	572
Building	22,420		22,420
Equipment	24,045		21,203
Furniture	3,376		3,376
Leasehold improvements	812		804
Construction in progress	2,175		2,848
	53,400		51,223
Less: Accumulated depreciation	(24,303)		(22,329)
Property and equipment, net	$	29,097	$	28,894

Accrued Expenses

Accrued expenses consist of the following:

	March 31,		June 30,
	2022		2021
Acquisition consideration	$	10,000	$	10,000
Commissions	4,784		7,869
Salaries and bonus	6,726		11,699
Accrued vacation	2,349		3,011
Clinical Studies	1,255		1,478
Accrued excise, sales and other taxes	960		1,464
Other accrued expenses	3,937		2,668
Accrued expenses	$	30,011	$	38,189

WIRION Acquisition Consideration

Following the successful completion of the manufacturing transfer of the WIRION system to the Company, the Company has agreed to pay an additional consideration of $10,000, half of which may be paid by the Company through an issuance of shares of its common stock. The Company reviewed this liability in response to the voluntary recall of the WIRION system referred to above and determined that it remains probable and appropriately recorded in accrued liabilities as of March 31, 2022, although this payment will be made at a later date than originally anticipated due to the recall.

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Revenue

9 Months Ended

Mar. 31, 2022

Revenue from Contract with Customer [Abstract]

Revenue

3. Revenue

The following table disaggregates the Company’s net revenues by product category and geography for the following periods:

	Three Months Ended				Nine Months Ended
	March 31,				March 31,
Product Category	2022		2021		2022		2021
Peripheral	$	37,370	$	42,295	$	115,282	$	129,183
Coronary	18,851		20,978		58,444		58,803
Total net revenues	$	56,221	$	63,273	$	173,726	$	187,986
Geography
United States	$	51,843	$	59,593	$	162,356	$	180,331
International	4,378		3,680		11,370		7,655
Total net revenues	$	56,221	$	63,273	$	173,726	$	187,986

Revenue of $1,782 was recognized in the nine months ended March 31, 2022 that was deferred as of June 30, 2021. As of March 31, 2022 and June 30, 2021, the Company had a liability of $1,254 and $1,985, respectively, related to estimates of variable consideration which are recorded within accounts payable on the consolidated balance sheet.

XML

Acquisition

9 Months Ended

Mar. 31, 2022

Business Combinations [Abstract]

Acquisition

4. Acquisitions

Peripheral Support Catheters

During fiscal 2021, the Company acquired a line of peripheral support catheters from WavePoint Medical, LLC (“WavePoint”) and also engaged WavePoint to develop a portfolio of specialty catheters.

The acquisition of peripheral support catheters was accounted for as an asset acquisition. As consideration in this transaction, the Company made an upfront payment of $3,353 to WavePoint, which was accounted for as a charge incurred in connection with acquired in process research and development ("IPR&D"). During the nine months ended March 31, 2022, the peripheral support catheters received 510(k) clearance and the Company made an additional $1,700 payment to WavePoint pursuant to the terms of the parties' agreement, which amount was capitalized as developed technology.

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Intangible Assets

9 Months Ended

Mar. 31, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets

5. Intangible Assets

The Company’s finite-lived intangible assets are stated at cost less accumulated amortization and include developed technology and trade name assets acquired in asset acquisitions, as well as costs incurred to obtain patents. Developed technology and trade name assets are amortized over 10 to 15 years. Patent costs are amortized beginning at the time of patent approval over a useful life not exceeding 20 years.

The components of intangible assets, net are as follows:

	March 31, 2022						June 30, 2021
	Gross Carrying Amount		Accumulated Amortization		Net Book Value		Gross Carrying Amount		Accumulated Amortization		Net Book Value
Developed technology	$	17,324	$	(2,863)	$	14,461	$	15,624	$	(1,997)	$	13,627
Patents	1,866		(872)		994		1,866		(780)		1,086
Trade name	760		(135)		625		760		(97)		663
Total intangible assets, net	$	19,950	$	(3,870)	$	16,080	$	18,250	$	(2,874)	$	15,376

Amortization expense expected for the next five years and thereafter is as follows:

Remainder of fiscal 2022	$	345
Fiscal 2023	1,381
Fiscal 2024	1,377
Fiscal 2025	1,374
Fiscal 2026	1,373
Thereafter	10,230
	$	16,080

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Debt

9 Months Ended

Mar. 31, 2022

Debt Disclosure [Abstract]

Debt

6. Debt

Revolving Credit Facility

In March 2017, the Company entered into a Loan and Security Agreement (the “Loan Agreement”) with Silicon Valley Bank (“SVB”). In March 2020, the Company entered into the First Amendment to the Loan Agreement (the "Amendment"). The Amendment extended the maturity date of the Loan Agreement by two years, to March 31, 2022, and increased the maximum amount available under the senior, secured revolving credit facility (the “Revolver”) to $50,000 (the “Maximum Dollar Amount”). In March 2022, the Company entered into the Second Amendment to the Loan Agreement (the "Second Amendment"). The Second Amendment extended the maturity date of the Loan Agreement by one year, to March 31, 2023.

Advances under the Revolver may be made from time to time up to the Maximum Dollar Amount, subject to certain borrowing limitations. The Revolver bears interest at a floating per annum rate equal to the Wall Street Journal prime rate, less 0.75%. Interest on borrowings is due monthly and the principal balance is due at maturity. Upon the Revolver’s maturity, any outstanding principal balance, unpaid accrued interest, and all other obligations under the Revolver will be due and payable. The Company will incur a fee equal to 1.5% of the Maximum Dollar Amount upon termination of the Loan Agreement, as amended by the Second Amendment (the "Amended Loan Agreement"), or the Revolver for any reason prior to the date that is fifteen days prior to the maturity date, unless refinanced with SVB.

The Company’s obligations under the Amended Loan Agreement are secured by certain of the Company’s assets, including, among other things, accounts receivable, deposit accounts, inventory, equipment, general intangibles and records pertaining to the foregoing. The collateral does not include the Company’s intellectual property, but the Company has agreed not to encumber its intellectual property without the consent of SVB. The Amended Loan Agreement contains customary covenants limiting the Company’s ability to, among other things, incur debt or liens, make certain investments and loans, enter into transactions with affiliates, undergo certain fundamental changes, dispose of assets, or change the nature of its business. In addition, the Amended Loan Agreement contains financial covenants requiring the Company to maintain, at all times when any amounts are outstanding under the Revolver, either (i) minimum unrestricted cash at SVB and unused availability on the Revolver of at least $10,000 or (ii) minimum trailing three-month Adjusted EBITDA of $1,000. If the Company does not comply with the various covenants under the Amended Loan Agreement or an event of default under the Amended Loan Agreement occurs, such as a material adverse change, the interest rate on outstanding amounts will increase by 5% and SVB may, subject to various customary cure rights and the other terms and conditions of the Amended Loan Agreement, decline to provide additional advances under the Revolver, require the immediate payment of all amounts outstanding under the Revolver, and foreclose on all collateral.

The Company is required to pay a fee equal to 0.15% per annum on the unused portion of the Revolver, payable quarterly in arrears. The Company is not obligated to draw any funds under the Revolver and has not done so under the Revolver since entering into the Loan Agreement. No amounts are outstanding as of March 31, 2022.

Financing Obligation

In March 2017, in connection with the sale of the Company’s headquarters facility in St. Paul, Minnesota (the “Facility”), the Company entered into a Lease Agreement to lease the Facility. The Lease Agreement has an initial term of 15 years, with four consecutive renewal options of 5 years each at the Company’s option, with a base annual rent in the first year of $1,638 and annual escalations of 3% thereafter. Rent during subsequent renewal terms will be at the then fair market rental rate. As the lease terms resulted in a capital lease classification, the Company accounted for the sale and leaseback of the Facility as a financing transaction where the assets remain on the Company’s balance sheet and a financing obligation was recorded for $20,944. As lease payments are made, they will be allocated between interest expense and a reduction of the financing obligation, resulting in a value of the financing obligation that is equivalent to the net book value of the assets at the end of the lease term. The effective interest rate is 7.89%. At the end of the lease (including any renewal option terms), the Company will remove the assets and financing obligation from its balance sheet.

Payments under the initial term of the Lease Agreement as of March 31, 2022 are as follows:

Remainder of fiscal 2022	$	475
Fiscal 2023	1,913
Fiscal 2024	1,970
Fiscal 2025	2,029
Fiscal 2026	2,090
Thereafter	13,286
	$	21,763

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Marketable Securities & Fair Value Measurements

9 Months Ended

Mar. 31, 2022

Fair Value Disclosures [Abstract]

Marketable Securities & Fair Value Measurements

7. Marketable Securities & Fair Value Measurements

The Company’s marketable securities are classified on the consolidated balance sheet as follows:

	March 31,		June 30,
	2022		2021
Short-term available-for-sale debt securities	$	94,236	$	129,908
Long-term available-for-sale debt securities	10,621		5,748
Available-for-sale debt securities	104,857		135,656
Mutual funds	241		312
Total marketable securities	$	105,098	$	135,968

Available-for-sale debt securities are invested in the following financial instruments:

			As of March 31, 2022
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
Commercial paper	$	37,450	$	—	$	—	$	37,450
Corporate debt	44,982		1		(117)		44,866
Asset backed securities	16,665		—		(79)		16,586
U.S. government securities	5,972		—		(17)		5,955
Total available-for-sale debt securities	$	105,069	$	1	$	(213)	$	104,857

			As of June 30, 2021
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
Commercial paper	$	47,361	$	—	$	—	$	47,361
U.S. government securities	20,229		1		—		20,230
Corporate debt	57,134		12		(12)		57,134
Asset backed securities	10,922		10		(1)		10,931
Total available-for-sale debt securities	$	135,646	$	23	$	(13)	$	135,656

The following table provides information by level for the Company’s marketable securities that were measured at fair value on a recurring basis:

			Fair Value Measurements as of March 31, 2022 Using Inputs Considered as
	Fair Value		Level 1		Level 2		Level 3
Commercial paper	$	37,450	$	—	$	37,450	$	—
U.S. government securities	5,955		—		5,955		—
Corporate debt	44,866		—		44,866		—
Asset backed securities	16,586		—		16,586		—
Mutual funds	241		124		117		—
Total marketable securities	$	105,098	$	124	$	104,974	$	—

			Fair Value Measurements as of June 30, 2021 Using Inputs Considered as
	Fair Value		Level 1		Level 2		Level 3
Commercial paper	$	47,361	$	—	$	47,361	$	—
U.S. government securities	20,230		—		20,230		—
Corporate debt	57,134		—		57,134		—
Asset backed securities	10,931		—		10,931		—
Mutual funds	312		136		176		—
Total marketable securities	$	135,968	$	136	$	135,832	$	—

The Company’s marketable securities classified within Level 1 are valued using real-time quotes for transactions in active exchange markets. Marketable securities within Level 2 are valued using readily available pricing sources. There were no transfers of assets between Level 1 and Level 2 of the fair value measurement hierarchy during the nine months ended March 31, 2022. Any transfers between levels would be recognized on the date of the event or when a change in circumstances causes a transfer.

Strategic Investments

The Company holds equity investments that do not have readily determined fair values. The Company has elected to measure these investments at cost minus impairment, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. Impairment is reviewed each reporting period by performing a qualitative assessment considering impairment indicators to evaluate whether the investment is impaired.

As of March 31, 2022 and June 30, 2021, the carrying value of these investments was $12,353 and $11,706, respectively. During the nine months ended March 31, 2022, no impairment indicators were noted. The Company is committed to funding an additional $1,410 into these investments in the future. The Company holds options to acquire all outstanding equity or certain developed technologies with respect to some of these strategic investments.

The Company also holds strategic investments accounted for as available-for-sale debt securities, which had carrying values and approximated fair values of $18,380 and $8,951 as of March 31, 2022 and June 30, 2021, respectively. The fair values of these investments are measured using Level 3 inputs and are not included in the tables above. Impairment is assessed similar to

the Company's other strategic investments and no impairment indicators were noted during the nine months ended March 31, 2022.

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Stock-Based Compensation

9 Months Ended

Mar. 31, 2022

Share-based Payment Arrangement, Disclosure [Abstract]

Stock-Based Compensation

8. Stock-Based Compensation

On November 15, 2017, the Company’s stockholders approved the 2017 Equity Incentive Plan (the “2017 Plan”) for the purpose of granting equity awards to employees, directors and consultants. On March 12, 2020, the Company’s Board of Directors approved the Amended and Restated 2017 Equity Incentive Plan, which amends the 2017 Plan. On August 19, 2021, the Company's Board of Directors adopted an amendment to the 2017 Plan, which was approved by the Company's stockholders on November 11, 2021, that increased the number of shares available for issuance under the 2017 Plan by 1,700,000 shares.

Equity awards classified as restricted stock and performance-based restricted stock are treated as issued shares when granted; however, these shares are not included in the computation of basic weighted average shares outstanding. When shares vest, unless the holder elects to pay the payroll tax liability in cash or through a sale of shares, the Company withholds the appropriate amount of shares to settle the payroll tax liability, on behalf of the individual receiving the shares, as an adjustment to accumulated deficit.

Restricted Stock

The value of each restricted stock award is equal to the fair market value of the Company’s common stock at the date of grant. Vesting of time-based restricted stock awards ranges from one year to three years. The estimated fair value of restricted stock awards, including the effect of estimated forfeitures, is recognized on a straight-line basis over the restricted stock’s vesting period.

Restricted stock award activity for the nine months ended March 31, 2022 is as follows:

	Number of Shares	Weighted Average Fair Value
Outstanding at June 30, 2021	467,942	$	35.61
Granted	556,934	$	28.16
Forfeited	(97,041)	$	33.89
Vested	(227,219)	$	36.44
Outstanding at March 31, 2022	700,616	$	29.68

Performance-Based Restricted Stock

The Company also grants performance-based restricted stock awards to certain executives and other management. In August 2021, the Company granted an aggregate maximum of 306,550 shares that vest based on the Company’s total shareholder return relative to total shareholder return of the Company’s peer group (a market condition), as measured by the closing prices of the stock of the Company and the peer group members for the 90 trading days preceding July 1, 2021 compared to the closing prices of the stock of the Company and the peer group members for the 90 trading days preceding July 1, 2024. Vesting of these awards will be determined on the date that the Company’s Annual Report on Form 10-K for the fiscal year ending June 30, 2024 is filed.

To calculate the estimated fair value of these restricted stock awards with market conditions, the Company uses a Monte Carlo simulation, which uses the expected average stock prices to estimate the expected number of shares that will vest. The Monte Carlo simulation resulted in an aggregate fair value of approximately $6,090, which the Company will recognize as expense using the straight-line method over the period that the awards are expected to vest. Stock-based compensation expense related to an award with a market condition will be recognized regardless of whether the market condition is satisfied, provided that the requisite service has been provided.

Performance-based restricted stock awards granted in fiscal 2021 and 2020 that are outstanding vest based on the Company’s total shareholder return relative to total shareholder return of the Company’s peer group (a market condition), as measured by the closing prices of the stock of the Company and the peer group members for the 90 trading days preceding July 1, 2020 and July 1, 2019, respectively, compared to the closing prices of the stock of the Company and the peer group members for the 90 trading days preceding July 1, 2023 and July 1, 2022, respectively.

Performance-based restricted stock award activity for the nine months ended March 31, 2022 is as follows:

	Number of Shares	Weighted Average Fair Value
Outstanding at June 30, 2021	760,584	$	20.26
Granted	306,550	$	19.87
Forfeited	(130,739)	$	22.73
Vested	(147,001)	$	22.32
Outstanding at March 31, 2022	789,394	$	19.52

Unrecognized stock compensation related to unvested stock awards outstanding as of March 31, 2022 was $20,014.

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Leases

9 Months Ended

Mar. 31, 2022

Leases [Abstract]

Leases

9. Leases

The Company leases its Texas manufacturing facility under an operating lease agreement which expires in April 2026. The Company also leases office equipment under lease agreements that expire at various dates through December 2026. As discussed in Note 6, the Company also leases its Minnesota headquarters facility which is accounted for as a financing obligation.

Operating lease right-of-use assets and liabilities are recognized based on the present value of future minimum lease payments over the lease term at commencement dates. The Company considers fixed or variable payment terms, prepayments, incentives, and options to extend, terminate or purchase. Renewal, termination or purchase options affect the lease term used for determining lease asset value only if the option is reasonably certain to be exercised. The Company uses its incremental borrowing rate based on information available at the lease commencement date in determining the present value of lease payments unless the lease provides an implicit interest rate.

Operating lease cost is classified within the consolidated statement of operations based on the nature of the leased asset. The Company's operating lease cost was $387 and $377 for the nine months ended March 31, 2022 and 2021, respectively. Cash paid for operating lease liabilities approximated operating lease cost for the nine months ended March 31, 2022. There were $103 and $2,238 of operating lease right-of-use assets obtained in exchange for new lease liabilities during the nine months ended March 31, 2022 and 2021, respectively.

	March 31,		June 30,
	2022		2021
Right-of-use assets
Other assets	$	1,936	$	2,212
Operating lease liabilities
Accrued expenses	510		487
Other liabilities	1,426		1,725
Total operating lease liabilities	$	1,936	$	2,212

Future minimum lease payments under the agreements as of March 31, 2022 are as follows:

Remainder of fiscal 2022	$	134
Fiscal 2023	528
Fiscal 2024	503
Fiscal 2025	494
Fiscal 2026	406
Thereafter	2
Total lease payments	2,067
Less imputed interest	(131)
Total operating lease liabilities	$	1,936

As of March 31, 2022, the weighted average remaining lease term for operating leases was 4.0 years and the weighted average discount rate used to determine operating lease liabilities was 2.51%.

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Commitment and Contingencies

9 Months Ended

Mar. 31, 2022

Commitments and Contingencies Disclosure [Abstract]

Commitment and Contingencies

10. Commitment and Contingencies

In the ordinary conduct of business, the Company is subject to various lawsuits and claims covering a wide range of matters including, but not limited to, employment claims, commercial disputes and product liability claims. While the outcome of these matters is uncertain, the Company does not believe there are any significant matters as of March 31, 2022 that are probable or estimable, for which the outcome could have a material adverse impact on its consolidated balance sheets or statements of operations.

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Earnings Per Share

9 Months Ended

Mar. 31, 2022

Earnings Per Share [Abstract]

Earnings Per Share

11. Earnings Per Share

The following table presents a reconciliation of the numerators and denominators used in the basic and diluted earnings per common share computations (in thousands except share and per share amounts):

	Three Months Ended				Nine Months Ended
	March 31,				March 31,
	2022		2021		2022		2021
Numerator
Net loss	$	(9,658)	$	(6,004)	$	(27,243)	$	(8,136)
Income allocated to participating securities	—		—		—		—
Net loss available to common stockholders	$	(9,658)	$	(6,004)	$	(27,243)	$	(8,136)
Denominator
Weighted average common shares outstanding – basic	39,287,632		38,911,454		39,190,865		38,800,622
Effect of dilutive stock options(1)	—		—		—		—
Effect of dilutive restricted stock units(2)	—		—		—		—
Effect of performance-based restricted stock awards(3)	—		—		—		—
Weighted average common shares outstanding – diluted	39,287,632		38,911,454		39,190,865		38,800,622
Earnings per common share – basic and diluted	$	(0.25)	$	(0.15)	$	(0.70)	$	(0.21)

(1)At March 31, 2022 and 2021, 76,019 and 42,528 stock options, respectively, were outstanding. The effect of the shares that would be issued upon exercise of these options has been excluded from the calculation of diluted loss per share for all periods presented because those shares are anti-dilutive.

(2)At March 31, 2022 and 2021, 310,415 and 282,763 additional shares of common stock, respectively, were issuable upon the settlement of outstanding restricted stock units. The effect of the shares that would be issued upon settlement of these restricted stock units has been excluded from the calculation of diluted loss per share for all periods presented because those shares are anti-dilutive.

(3)At March 31, 2022 and 2021, 789,394 and 760,584 performance-based restricted stock awards, respectively, were outstanding. The effect of the potential vesting of these awards has been excluded from the calculation of diluted loss per share for all periods presented because those shares are anti-dilutive.

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Selected Consolidated Financial Statement Information (Tables)

9 Months Ended

Mar. 31, 2022

Quarterly Financial Information Disclosure [Abstract]

Schedule of Accounts Receivable

	March 31,		June 30,
	2022		2021
Accounts receivable	$	35,871	$	41,634
Less: Allowance for doubtful accounts	(1,205)		(1,601)
Accounts receivable, net	$	34,666	$	40,033

Schedule of Inventory

	March 31,		June 30,
	2022		2021
Raw materials	$	12,337	$	11,621
Work in process	3,781		3,469
Finished goods	16,736		17,223
Inventories	$	32,854	$	32,313

Schedule of Property and Equipment

	March 31,		June 30,
	2022		2021
Land	$	572	$	572
Building	22,420		22,420
Equipment	24,045		21,203
Furniture	3,376		3,376
Leasehold improvements	812		804
Construction in progress	2,175		2,848
	53,400		51,223
Less: Accumulated depreciation	(24,303)		(22,329)
Property and equipment, net	$	29,097	$	28,894

Schedule of Accrued Expenses

	March 31,		June 30,
	2022		2021
Acquisition consideration	$	10,000	$	10,000
Commissions	4,784		7,869
Salaries and bonus	6,726		11,699
Accrued vacation	2,349		3,011
Clinical Studies	1,255		1,478
Accrued excise, sales and other taxes	960		1,464
Other accrued expenses	3,937		2,668
Accrued expenses	$	30,011	$	38,189

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Revenue (Tables)

9 Months Ended

Mar. 31, 2022

Revenue from Contract with Customer [Abstract]

Disaggregation of Revenue

	Three Months Ended				Nine Months Ended
	March 31,				March 31,
Product Category	2022		2021		2022		2021
Peripheral	$	37,370	$	42,295	$	115,282	$	129,183
Coronary	18,851		20,978		58,444		58,803
Total net revenues	$	56,221	$	63,273	$	173,726	$	187,986
Geography
United States	$	51,843	$	59,593	$	162,356	$	180,331
International	4,378		3,680		11,370		7,655
Total net revenues	$	56,221	$	63,273	$	173,726	$	187,986

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Intangible Assets (Tables)

9 Months Ended

Mar. 31, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Finite-Lived Intangible Assets

	March 31, 2022						June 30, 2021
	Gross Carrying Amount		Accumulated Amortization		Net Book Value		Gross Carrying Amount		Accumulated Amortization		Net Book Value
Developed technology	$	17,324	$	(2,863)	$	14,461	$	15,624	$	(1,997)	$	13,627
Patents	1,866		(872)		994		1,866		(780)		1,086
Trade name	760		(135)		625		760		(97)		663
Total intangible assets, net	$	19,950	$	(3,870)	$	16,080	$	18,250	$	(2,874)	$	15,376

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense

Remainder of fiscal 2022	$	345
Fiscal 2023	1,381
Fiscal 2024	1,377
Fiscal 2025	1,374
Fiscal 2026	1,373
Thereafter	10,230
	$	16,080

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Debt (Tables)

9 Months Ended

Mar. 31, 2022

Debt Disclosure [Abstract]

Schedule of future minimum lease payments

Remainder of fiscal 2022	$	475
Fiscal 2023	1,913
Fiscal 2024	1,970
Fiscal 2025	2,029
Fiscal 2026	2,090
Thereafter	13,286
	$	21,763

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Marketable Securities & Fair Value Measurements (Tables)

9 Months Ended

Mar. 31, 2022

Fair Value Disclosures [Abstract]

Marketable Securities

	March 31,		June 30,
	2022		2021
Short-term available-for-sale debt securities	$	94,236	$	129,908
Long-term available-for-sale debt securities	10,621		5,748
Available-for-sale debt securities	104,857		135,656
Mutual funds	241		312
Total marketable securities	$	105,098	$	135,968

Schedule of Available-for-sale Securities Reconciliation

			As of March 31, 2022
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
Commercial paper	$	37,450	$	—	$	—	$	37,450
Corporate debt	44,982		1		(117)		44,866
Asset backed securities	16,665		—		(79)		16,586
U.S. government securities	5,972		—		(17)		5,955
Total available-for-sale debt securities	$	105,069	$	1	$	(213)	$	104,857

			As of June 30, 2021
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
Commercial paper	$	47,361	$	—	$	—	$	47,361
U.S. government securities	20,229		1		—		20,230
Corporate debt	57,134		12		(12)		57,134
Asset backed securities	10,922		10		(1)		10,931
Total available-for-sale debt securities	$	135,646	$	23	$	(13)	$	135,656

Fair Value, Assets Measured on Recurring Basis

			Fair Value Measurements as of March 31, 2022 Using Inputs Considered as
	Fair Value		Level 1		Level 2		Level 3
Commercial paper	$	37,450	$	—	$	37,450	$	—
U.S. government securities	5,955		—		5,955		—
Corporate debt	44,866		—		44,866		—
Asset backed securities	16,586		—		16,586		—
Mutual funds	241		124		117		—
Total marketable securities	$	105,098	$	124	$	104,974	$	—

			Fair Value Measurements as of June 30, 2021 Using Inputs Considered as
	Fair Value		Level 1		Level 2		Level 3
Commercial paper	$	47,361	$	—	$	47,361	$	—
U.S. government securities	20,230		—		20,230		—
Corporate debt	57,134		—		57,134		—
Asset backed securities	10,931		—		10,931		—
Mutual funds	312		136		176		—
Total marketable securities	$	135,968	$	136	$	135,832	$	—

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Stock-Based Compensation (Tables)

9 Months Ended

Mar. 31, 2022

Share-based Payment Arrangement, Disclosure [Abstract]

Restricted Stock Award Activity

	Number of Shares	Weighted Average Fair Value
Outstanding at June 30, 2021	467,942	$	35.61
Granted	556,934	$	28.16
Forfeited	(97,041)	$	33.89
Vested	(227,219)	$	36.44
Outstanding at March 31, 2022	700,616	$	29.68

Performance Based RSA Activity

	Number of Shares	Weighted Average Fair Value
Outstanding at June 30, 2021	760,584	$	20.26
Granted	306,550	$	19.87
Forfeited	(130,739)	$	22.73
Vested	(147,001)	$	22.32
Outstanding at March 31, 2022	789,394	$	19.52

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Leases (Tables)

9 Months Ended

Mar. 31, 2022

Leases [Abstract]

Lease, Cost

	March 31,		June 30,
	2022		2021
Right-of-use assets
Other assets	$	1,936	$	2,212
Operating lease liabilities
Accrued expenses	510		487
Other liabilities	1,426		1,725
Total operating lease liabilities	$	1,936	$	2,212

Lessee, Operating Lease, Liability, Maturity

Remainder of fiscal 2022	$	134
Fiscal 2023	528
Fiscal 2024	503
Fiscal 2025	494
Fiscal 2026	406
Thereafter	2
Total lease payments	2,067
Less imputed interest	(131)
Total operating lease liabilities	$	1,936

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Earnings Per Share (Tables)

9 Months Ended

Mar. 31, 2022

Earnings Per Share [Abstract]

Reconciliation of Numerators and Denominators Used in Basic and Diluted Earnings Per Common Share Computations

	Three Months Ended				Nine Months Ended
	March 31,				March 31,
	2022		2021		2022		2021
Numerator
Net loss	$	(9,658)	$	(6,004)	$	(27,243)	$	(8,136)
Income allocated to participating securities	—		—		—		—
Net loss available to common stockholders	$	(9,658)	$	(6,004)	$	(27,243)	$	(8,136)
Denominator
Weighted average common shares outstanding – basic	39,287,632		38,911,454		39,190,865		38,800,622
Effect of dilutive stock options(1)	—		—		—		—
Effect of dilutive restricted stock units(2)	—		—		—		—
Effect of performance-based restricted stock awards(3)	—		—		—		—
Weighted average common shares outstanding – diluted	39,287,632		38,911,454		39,190,865		38,800,622
Earnings per common share – basic and diluted	$	(0.25)	$	(0.15)	$	(0.70)	$	(0.21)

(1)At March 31, 2022 and 2021, 76,019 and 42,528 stock options, respectively, were outstanding. The effect of the shares that would be issued upon exercise of these options has been excluded from the calculation of diluted loss per share for all periods presented because those shares are anti-dilutive.

(2)At March 31, 2022 and 2021, 310,415 and 282,763 additional shares of common stock, respectively, were issuable upon the settlement of outstanding restricted stock units. The effect of the shares that would be issued upon settlement of these restricted stock units has been excluded from the calculation of diluted loss per share for all periods presented because those shares are anti-dilutive.

(3)At March 31, 2022 and 2021, 789,394 and 760,584 performance-based restricted stock awards, respectively, were outstanding. The effect of the potential vesting of these awards has been excluded from the calculation of diluted loss per share for all periods presented because those shares are anti-dilutive.

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Selected Consolidated Financial Statement Information - Accounts Receivable (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Jun. 30, 2021
Accounts Receivable
Accounts receivable	$ 35,871	$ 41,634
Less: Allowance for doubtful accounts	(1,205)	(1,601)
Accounts receivable, net	$ 34,666	$ 40,033

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Selected Consolidated Financial Statement Information - Inventories (Details) - USD ($) $ in Thousands	9 Months Ended
	Mar. 31, 2022	Jun. 30, 2021
Inventories
Raw materials	$ 12,337	$ 11,621
Work in process	3,781	3,469
Finished goods	16,736	17,223
Inventories	32,854	$ 32,313
Wirion recall disclosures
Wirion recall reserve expense	$ 2,849

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Selected Consolidated Financial Statement Information - Property and Equipment, Net (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Jun. 30, 2021
Property and Equipment
Land	$ 572	$ 572
Building	22,420	22,420
Equipment	24,045	21,203
Furniture	3,376	3,376
Leasehold improvements	812	804
Construction in progress	2,175	2,848
Property and equipment, gross	53,400	51,223
Less: Accumulated depreciation	(24,303)	(22,329)
Property and equipment, net	$ 29,097	$ 28,894

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Selected Consolidated Financial Statement Information - Accrued Expenses (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Jun. 30, 2021
Accrued Expenses
Accrued Acquisition Consideration	$ 10,000	$ 10,000
Accrued Sales Commission, Current	4,784	7,869
Accrued Salaries and Bonus	6,726	11,699
Accrued Vacation, Current	2,349	3,011
Accrued Clinical Studies	1,255	1,478
Accrued Taxes	960	1,464
Other Accrued Liabilities, Current	3,937	2,668
Accrued Liabilities, Current, Total	$ 30,011	$ 38,189

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Revenue - Disaggregate (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Mar. 31, 2022	Mar. 31, 2021
Disaggregation of Revenue [Line Items]
Net revenues	$ 56,221	$ 63,273	$ 173,726	$ 187,986
United States
Disaggregation of Revenue [Line Items]
Net revenues	51,843	59,593	162,356	180,331
International
Disaggregation of Revenue [Line Items]
Net revenues	4,378	3,680	11,370	7,655
Peripheral
Disaggregation of Revenue [Line Items]
Net revenues	37,370	42,295	115,282	129,183
Coronary
Disaggregation of Revenue [Line Items]
Net revenues	$ 18,851	$ 20,978	$ 58,444	$ 58,803

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Revenue - Narratives (Details) - USD ($) $ in Thousands	9 Months Ended
	Mar. 31, 2022	Jun. 30, 2021
Revenue from Contract with Customer [Abstract]
Revenue recognized previously deferred	$ 1,782
Volume-based rebates, discounts and incentives, current	$ 1,254	$ 1,985

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Acquisition (Details) - USD ($) $ in Thousands	9 Months Ended
	Mar. 31, 2021	Mar. 31, 2022
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Charges incurred in connection with acquired IPR&D	$ 3,353
WavePoint Peripheral Support Catheters
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Charges incurred in connection with acquired IPR&D	$ 3,353
Additional Consideration, Pending Catheter Approval		$ 1,700

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Intangible Assets - Finite-Lived (Details) - USD ($) $ in Thousands	9 Months Ended
	Mar. 31, 2022	Jun. 30, 2021
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Assets, Gross	$ 19,950	$ 18,250
Finite-Lived Intangible Assets, Accumulated Amortization	(3,870)	(2,874)
Finite-Lived Intangible Assets, Net, Total	$ 16,080	15,376
Developed Technology and Trade Names | Minimum
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Asset, Useful Life	10 years
Developed Technology and Trade Names | Maximum
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Asset, Useful Life	15 years
Developed Technology Rights
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Assets, Gross	$ 17,324	15,624
Finite-Lived Intangible Assets, Accumulated Amortization	(2,863)	(1,997)
Finite-Lived Intangible Assets, Net, Total	$ 14,461	13,627
Patents
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Asset, Useful Life	20 years
Finite-Lived Intangible Assets, Gross	$ 1,866	1,866
Finite-Lived Intangible Assets, Accumulated Amortization	(872)	(780)
Finite-Lived Intangible Assets, Net, Total	994	1,086
Trade Names
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Assets, Gross	760	760
Finite-Lived Intangible Assets, Accumulated Amortization	(135)	(97)
Finite-Lived Intangible Assets, Net, Total	$ 625	$ 663

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Intangible Assets - Amortization (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Jun. 30, 2021
Goodwill and Intangible Assets Disclosure [Abstract]
Remainder of fiscal 2022	$ 345
Fiscal 2023	1,381
Fiscal 2024	1,377
Fiscal 2025	1,374
Fiscal 2026	1,373
Thereafter	10,230
Finite-Lived Intangible Assets, Net, Total	$ 16,080	$ 15,376

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Debt - Revolving Credit Facility (Details) - Silicon Valley Bank - Revolving Credit Facility - USD ($) $ in Thousands	1 Months Ended
	Mar. 31, 2022	Mar. 31, 2020	Mar. 31, 2017
Line of Credit Facility [Line Items]
Percent Reduction to Prime Interest Rate			0.75%
Amendment One [Member]
Line of Credit Facility [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity		$ 50,000
Line of Credit Facility, Expiration Date		Mar. 31, 2022
Covenant, Unused Availability			$ 10,000
Covenant, Adjusted EBITDA			$ 1,000
Interest Rate Increase For Noncompliance			5.00%
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage	0.15%
Line of Credit Facility, Fair Value of Amount Outstanding	$ 0
Amendment Two [Member]
Line of Credit Facility [Line Items]
Line of Credit Facility, Expiration Date	Mar. 31, 2023
Early Termination Fee	1.50%

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Debt - Financing Obligation (Details) - Headquarter Facility $ in Thousands	1 Months Ended
	Mar. 31, 2017 lease_renewal_option	Mar. 31, 2022 USD ($)	Jun. 30, 2017 USD ($)
Debt Instrument [Line Items]
Lessee, Finance Lease, Term of Contract			15 years
Lessee, Finance Lease, Number Options To Renew | lease_renewal_option	4
Lessee, Finance Lease, Renewal Term			5 years
Base Annual Rent Under Facility Lease			$ 1,638
Annual Rent Escalation			3.00%
Financing Obligation			$ 20,944
Effective Interest Rate			7.89%
Remainder of fiscal 2022		$ 475
Fiscal 2023		1,913
Fiscal 2024		1,970
Fiscal 2025		2,029
Fiscal 2026		2,090
Fiscal 2026		13,286
Payments under lease agreement		$ 21,763

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Marketable Securities & Fair Value Measurements - Available-for-sale Measured at Fair Value (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Jun. 30, 2021
Marketable Securities [Abstract]
Short-term available-for-sale debt securities	$ 94,236	$ 129,908
Long-term available-for-sale debt securities	10,621	5,748
Recurring
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Amortized Cost	105,069	135,646
Unrealized Gains	1	23
Unrealized Losses	(213)	(13)
Fair Value	104,857	135,656
Marketable Securities [Abstract]
Total marketable securities	105,098	135,968
Recurring | Commercial Paper
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Amortized Cost	37,450	47,361
Unrealized Gains	0	0
Unrealized Losses	0	0
Fair Value	37,450	47,361
Marketable Securities [Abstract]
Total marketable securities	37,450	47,361
Recurring | Corporate Debt Securities
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Amortized Cost	44,982	57,134
Unrealized Gains	1	12
Unrealized Losses	(117)	(12)
Fair Value	44,866	57,134
Marketable Securities [Abstract]
Total marketable securities	44,866	57,134
Recurring | Asset-backed Securities
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Amortized Cost	16,665	10,922
Unrealized Gains	0	10
Unrealized Losses	(79)	(1)
Fair Value	16,586	10,931
Marketable Securities [Abstract]
Total marketable securities	16,586	10,931
Recurring | Equity Funds
Marketable Securities [Abstract]
Total marketable securities	241	312
Recurring | U.S. government securities
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Amortized Cost	5,972	20,229
Unrealized Gains	0	1
Unrealized Losses	(17)	0
Fair Value	5,955	20,230
Marketable Securities [Abstract]
Total marketable securities	$ 5,955	$ 20,230

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Marketable Securities & Fair Value Measurements - Fair Value Measurements (Details) - Recurring - USD ($) $ in Thousands	Mar. 31, 2022	Jun. 30, 2021
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total marketable securities	$ 105,098	$ 135,968
Commercial Paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total marketable securities	37,450	47,361
U.S. government securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total marketable securities	5,955	20,230
Corporate Debt Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total marketable securities	44,866	57,134
Asset-backed Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total marketable securities	16,586	10,931
Equity Funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total marketable securities	241	312
Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total marketable securities	124	136
Level 1 | Commercial Paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total marketable securities	0	0
Level 1 | U.S. government securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total marketable securities	0	0
Level 1 | Corporate Debt Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total marketable securities	0	0
Level 1 | Asset-backed Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total marketable securities	0	0
Level 1 | Equity Funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total marketable securities	124	136
Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total marketable securities	104,974	135,832
Level 2 | Commercial Paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total marketable securities	37,450	47,361
Level 2 | U.S. government securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total marketable securities	5,955	20,230
Level 2 | Corporate Debt Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total marketable securities	44,866	57,134
Level 2 | Asset-backed Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total marketable securities	16,586	10,931
Level 2 | Equity Funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total marketable securities	117	176
Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total marketable securities	0	0
Level 3 | Commercial Paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total marketable securities	0	0
Level 3 | U.S. government securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total marketable securities	0	0
Level 3 | Corporate Debt Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total marketable securities	0	0
Level 3 | Asset-backed Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total marketable securities	0	0
Level 3 | Equity Funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total marketable securities	$ 0	$ 0

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Marketable Securities & Fair Value Measurements - Narrative (Details) - USD ($)	9 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Jun. 30, 2021
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Transfer of assets between level 1 and 2	$ 0
Equity Securities without Readily Determinable Fair Value, Amount	12,353,000		$ 11,706,000
Future payments to acquire long-term investments	1,410,000
Payments to Acquire Debt Securities, Available-for-sale	85,076,000	$ 156,628,000
Other-than-temporary impairments	0
Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale debt securities	$ 18,380,000		$ 8,951,000

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Stock-Based Compensation - Narrative (Details) - USD ($) $ in Thousands	1 Months Ended	9 Months Ended
	Aug. 31, 2021	Mar. 31, 2022	Nov. 11, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount		$ 20,014
2017 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares authorized			1,700,000
Restricted Stock | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period		1 year
Restricted Stock | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period		3 years
Performance Shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Performance-based awards number preceding trading days		90 days
Grant Date Fair Value of Restricted Stock Awards, Quarterly Market Conditions	$ 6,090
Performance Shares | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Aggregate shares based on thresholds measuring total shareholder return	306,550

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Stock-Based Compensation - Restricted Stock Award Activity (Details)	9 Months Ended
	Mar. 31, 2022 $ / shares shares
Restricted Stock
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Awards outstanding, balance at beginning of period (in shares) | shares	467,942
Awards granted (in shares) | shares	556,934
Awards forfeited (in shares) | shares	(97,041)
Awards vested (in shares) | shares	(227,219)
Awards outstanding, balance at end of period (in shares) | shares	700,616
Weighted Average Fair Value
Awards outstanding, balance at beginning of period (per share) | $ / shares	$ 35.61
Awards granted (per share) | $ / shares	28.16
Awards forfeited (per share) | $ / shares	33.89
Awards vested (per share) | $ / shares	36.44
Awards outstanding, balance at end of period (per share) | $ / shares	$ 29.68
Performance Shares
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Awards outstanding, balance at beginning of period (in shares) | shares	760,584
Awards granted (in shares) | shares	306,550
Awards forfeited (in shares) | shares	(130,739)
Awards vested (in shares) | shares	(147,001)
Awards outstanding, balance at end of period (in shares) | shares	789,394
Weighted Average Fair Value
Awards outstanding, balance at beginning of period (per share) | $ / shares	$ 20.26
Awards granted (per share) | $ / shares	19.87
Awards forfeited (per share) | $ / shares	22.73
Awards vested (per share) | $ / shares	22.32
Awards outstanding, balance at end of period (per share) | $ / shares	$ 19.52

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Leases - Narrative (Details) - USD ($) $ in Thousands	9 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Leases [Abstract]
Operating lease, cost	$ 387	$ 377
Right-of-use asset obtained in exchange for operating lease liability	$ 103	$ 2,238
Operating lease, weighted average remaining lease term	4 years
Operating lease, weighted average discount rate, percent	2.51%

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Leases - Balance Sheet Information (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Jun. 30, 2021
Leases [Abstract]
Other assets	$ 1,936	$ 2,212
Accrued expenses	510	487
Other liabilities	1,426	1,725
Total operating lease liabilities	$ 1,936	$ 2,212

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Leases, Assets and Liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Jun. 30, 2021
Lessee, Operating Lease, Liability, Payment, Due
Remainder of fiscal 2022	$ 134
Fiscal 2023	528
Fiscal 2024	503
Fiscal 2025	494
Fiscal 2026	406
Thereafter	2
Total lease payments	2,067
Less imputed interest	(131)
Total operating lease liabilities	$ 1,936	$ 2,212

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Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended						9 Months Ended
	Mar. 31, 2022	Dec. 31, 2021	Sep. 30, 2021	Mar. 31, 2021	Dec. 31, 2020	Sep. 30, 2020	Mar. 31, 2022	Mar. 31, 2021	Jun. 30, 2021
Numerator
Net loss	$ (9,658)	$ (8,967)	$ (8,618)	$ (6,004)	$ (56)	$ (2,076)	$ (27,243)	$ (8,136)
Income allocated to participating securities	0			0			0	0
Net loss available to common stockholders	$ (9,658)			$ (6,004)			$ (27,243)	$ (8,136)
Denominator
Basic weighted average shares outstanding	39,287,632			38,911,454			39,190,865	38,800,622
Weighted average common shares outstanding – diluted	39,287,632			38,911,454			39,190,865	38,800,622
Earnings per share, basic and diluted
Basic earnings per share	$ (0.25)			$ (0.15)			$ (0.70)	$ (0.21)
Diluted earnings per share	$ (0.25)			$ (0.15)			$ (0.70)	$ (0.21)
Common stock, shares outstanding	40,784,179						40,784,179		40,215,554
Stock Options
Denominator
Effect of dilutive share-based payment arrangements (in shares)	0			0			0	0
Earnings per share, basic and diluted
Common stock, shares outstanding	76,019			42,528			76,019	42,528
Restricted Stock Units (RSUs)
Denominator
Effect of dilutive share-based payment arrangements (in shares)	0			0			0	0
Earnings per share, basic and diluted
Common stock, shares outstanding	310,415			282,763			310,415	282,763
Performance Shares
Denominator
Effect of dilutive share-based payment arrangements (in shares)	0			0			0	0
Earnings per share, basic and diluted
Common stock, shares outstanding	789,394			760,584			789,394	760,584