The grant date fair value of restricted share units and performance share units is based on the market value of Fabrinet's ordinary shares on the date of grant.


	Three Months Ended				Nine Months Ended
(in thousands)	March 29, 2024		March 31, 2023		March 29, 2024		March 31, 2023
Share-based compensation expense by type of award:
Restricted share units	$	3,833	$	3,945	$	12,800	$	12,845
Performance share units	2,893		2,774		8,640		8,372
Total share-based compensation expense	6,726		6,719		21,440		21,217
Tax effect on share-based compensation expense	—		—		—		—
Net effect on share-based compensation expense	$	6,726	$	6,719	$	21,440	$	21,217


	Three Months Ended				Nine Months Ended
(in thousands)	March 29, 2024		March 31, 2023		March 29, 2024		March 31, 2023
Cost of revenue	$	1,561	$	1,453	$	5,427	$	5,028
Selling, general and administrative expense	5,165		5,080		16,013		16,003
Restructuring and other related costs	—		186		—		186
Total share-based compensation expense	$	6,726	$	6,719	$	21,440	$	21,217

The Company did not capitalize any share-based compensation expense as part of any asset costs during the three and nine months ended March 29, 2024 and March 31, 2023.

On December 12, 2019, the Company’s shareholders approved Fabrinet’s 2020 Equity Incentive Plan (the “2020 Plan”). Upon the approval of the 2020 Plan, Fabrinet’s Amended and Restated 2010 Performance Incentive Plan (the “2010 Plan”) was simultaneously terminated. The 2020 Plan provides for the grant of equity awards thereunder with respect to (i) 1,700,000 ordinary shares, plus (ii) up to 1,300,000 ordinary shares that, as of immediately prior to the termination of the 2010 Plan, had been reserved but not issued pursuant to any awards granted under the 2010 Plan and are not subject to any awards thereunder. Upon termination of the 2010 Plan, 1,281,619 ordinary shares were reserved for issuance under the 2020 Plan pursuant to clause (ii) of the preceding sentence.

On November 2, 2017, the Company adopted the 2017 Inducement Equity Incentive Plan (the “2017 Inducement Plan”) with a reserve of 160,000 ordinary shares authorized for future issuance solely for the granting of inducement share options and equity awards to new employees. The 2017 Inducement Plan was adopted without shareholder approval in reliance on the “employment inducement exemption” provided under the New York Stock Exchange Listed Company Manual.

The following table summarizes the number of equity awards outstanding and ordinary shares available for grant under each of the Equity Incentive Plans as of March 29, 2024:


(share units)	Restricted Share Units outstanding	Performance Share Units outstanding	Ordinary Shares available for future grant
2020 Plan	311,565	171,078	1,753,905
2017 Inducement Plan	—	—	111,347
Total	311,565	171,078	1,865,252

Restricted share units granted to employees generally vest in equal installments over three or four years on each anniversary of the vesting commencement date. Restricted share units granted to non-employee directors generally cliff vest 100% on the first of January, approximately one year from the grant date, provided the director continues to serve through such date.

Performance share units granted to executives will vest, if at all, at the end of a two-year performance period based on the Company’s achievement of pre-defined performance criteria, which consist of revenue and non-GAAP operating margin targets. The actual number of performance share units that may vest at the end of the performance period ranges from 0% to 100% of the award grant.


	Number of Shares	Weighted- Average Grant Date Fair Value Per Share
Balance as of June 30, 2023	368,765	$	97.49
Granted	119,097	$	162.02
Vested	(161,927)	$	88.75
Forfeited	(14,370)	$	119.71
Balance as of March 29, 2024	311,565	$	125.67


	Number of Shares	Weighted- Average Grant Date Fair Value Per Share
Balance as of June 24, 2022	459,626	$	75.14
Granted	154,113	$	119.23
Vested	(220,004)	$	67.23
Forfeited	(19,697)	$	91.84
Balance as of March 31, 2023	374,038	$	97.08


	Number of Shares	Weighted- Average Grant Date Fair Value Per Share
Balance as of June 30, 2023	204,016	$	108.81
Granted	73,936	$	158.91
Vested	(106,874)	$	101.05
Forfeited	—	$	—
Balance as of March 29, 2024	171,078	$	135.31


	Number of Shares	Weighted- Average Grant Date Fair Value Per Share
Balance as of June 24, 2022	285,882	$	81.64
Granted	97,142	$	117.35
Vested	(179,008)	70.05
Forfeited	—	$	—
Balance as of March 31, 2023	204,016	$	108.81

As of March 29, 2024, there was $16.3 million and $9.7 million of unrecognized share-based compensation expense related to restricted share units and performance share units, respectively, under the Equity Incentive Plans that is expected to be recorded over a weighted-average period of 2.6 and 1.1 years, respectively.

For the nine months ended March 29, 2024 and March 31, 2023, the Company withheld an aggregate of 102,543 shares and 172,929 shares, respectively, upon the vesting of restricted share units and performance shares units, based upon the closing share price on the vesting date to settle employee tax withholding obligations. For the nine months ended March 29, 2024 and March 31, 2023, the Company then remitted cash of $12.7 million and $17.7 million, respectively, to the appropriate taxing authorities and presented it as a financing activity within the unaudited condensed consolidated statements of cash flows. The payment was recorded as a reduction of additional paid-in capital.