STOCK-BASED COMPENSATION

The Company has two stock-based compensation methods available when determining employee compensation.

(1)Long-Term Incentive Compensation Plans

Long-Term Incentive Compensation Plan

The Long-Term Incentive Compensation Plan provides for shares of common stock to be awarded to officers and key employees based on performance targets set by the Compensation Committee of the Board of Directors (the “Committee”). The Company’s shareholders previously approved 700,000 shares to be issued under the plan. As of September 30, 2018, 102,183 shares have been issued. The Committee selected fully-diluted earnings per share as the performance goal for the three-year performance periods July 1, 2016 – June 30, 2019 (2017-2019) and July 1, 2017 – June 30, 2020 (2018-2020), and July 1, 2018 – June 30, 2021 (2019-2021). The Committee also selected total shareholder return as a performance goal for the executive officers for the three-year performance periods 2017-2019, 2018-2020 and 2019-2021. Stock awards will be issued to participants as soon as practicable following the end of the performance periods subject to verification of results and Committee approval. The compensation cost related to the number of shares to be granted under each performance period is fixed on the grant date, which is the date the performance period begins.

During the quarters ended September 30, 2018 and September 30, 2017, the Company recorded no plan expense. If the target performance goals for 2017-2019, 2018-2020 and 2019-2021 plans would be achieved, the total amount of compensation cost recognized over the requisite performance periods would be $0.9 million, $0.6 million and $0.4 million, respectively.

(2)Stock Plans

Omnibus Stock Plan

The Omnibus Stock Plan is for key employees, officers and directors and provides for the granting of incentive and nonqualified stock options, restricted stock, restricted stock units, stock appreciation rights and performance units. The Company’s shareholders previously approved 700,000 shares to be issued under the plan.

Under the plan, options were granted at an exercise price equal to the fair market value of the underlying common stock at the date of grant and exercisable for up to 10 years. All options were exercisable when granted. It is the Company’s policy to issue new shares upon exercise of stock options. The Company accepts shares of the Company’s common stock as payment for the exercise price of options. Shares received as payment are retired upon receipt. During the quarters ended September 30, 2018 and 2017, the Company issued options for 36,095 and 21,439 common shares and recorded expense of $0.3 million and $0.2 million related to stock option grants, respectively.

Under the plan, the Company issued 2,590 and 1,863 shares to non-executive directors as compensation and recorded expense of $0.1 million during the quarters ended September 30, 2018 and 2017, respectively.

During the quarter ended September 30, 2018, the Company recorded $0.2 million compensation expense for grants of an aggregate 39,666 restricted stock units under the plan to four executive officers as per their notification of award letters dated July 1, 2018. During the quarter ended September 30, 2017, the Company recorded $0.1 million compensation expense for grants of an aggregate 6,280 restricted stock units under the plan to two executive officers as per their notification of award letters dated July 1, 2017.

During the quarter ended September 30, 2017, the Company issued 2,000 restricted stock units outside of the plan to its Chief Executive Officer as compensation expense related to a Letter Agreement signed June 29, 2012. This was the final restricted stock unit issuance related to the Letter Agreement.

At September 30, 2018, 437,117 shares were available for future grants under the plan.

2006 and 2009 Stock Option Plans

The stock option plans were for key employees, officers and directors and provided for granting incentive and nonqualified stock options. Under the plans, options were granted at an exercise price equal to the fair market value of the underlying common stock at the date of grant and exercisable for up to 10 years. All options were exercisable when granted. No additional options can be granted under the 2006 and 2009 stock option plans.

A summary of the status of the Company’s stock plans as of September 30, 2018, June 30, 2018 and 2017 and the changes during the periods then ended is presented below:



			Weighted		Aggregate
	Shares		Average		Intrinsic Value
	(in thousands)		Exercise Price		(in thousands)
Outstanding and exercisable at June 30, 2017	187	$	27.21	$	5,039
Granted	21		45.21
Exercised	(21)		18.89
Canceled	(21)		26.77
Outstanding and exercisable at June 30, 2018	166	$	30.65	$	1,841
Granted	36		32.80
Exercised	(3)		17.23
Canceled	(3)		45.46
Outstanding and exercisable at September 30, 2018	196	$	30.97	$	744

The following table summarizes information for options outstanding and exercisable at September 30, 2018:



		Options
		Outstanding and	Weighted Average
	Range of	Exercisable	Remaining		Exercise
	Prices	(in thousands)	Life (Years)		Price
$	6.96 - 13.90	17	2.1	$	11.16
	17.23 - 19.77	26	3.5		18.88
	20.50 - 27.57	36	4.8		25.54
	31.06 - 32.80	65	8.3		32.30
	43.09 - 47.45	52	8.0		45.36
$	6.96 - 47.45	196	6.4	$	30.97