STOCK-BASED COMPENSATION

12 Months Ended

Jun. 30, 2021

Share-based Payment Arrangement [Abstract]

The Company grants long-term equity-based awards under the 2018 Long Term Incentive Plan (the 2018 Plan). The 2018 Plan, which was approved by the Company's shareholders at its 2018 Annual Meeting, provides for the granting of nonqualified stock options (SOs), equity-based stock appreciation rights (SARs), restricted stock units (RSUs) and stock-settled performance units (PSUs), as well as cash-based performance grants, to employees and non-employee directors of the Company. Under the 2018 Plan, a maximum of 3,818,895 shares are approved for issuance. The 2018 Plan incorporates a fungible share design, under which full value awards (such as RSUs and PSUs) count against the shares reserved for issuance at a rate 2.0 times higher than appreciation awards (such as SARs and SOs). As of June 30, 2021, a maximum of 3,341,011 shares were available for grant under the 2018 Plan. All unvested awards are subject to forfeiture in event of termination of employment, unless accelerated. SAR and RSU awards granted under the 2018 Plan generally include various acceleration terms, including upon retirement for participants aged sixty-two years or older or who are aged fifty-five or older and have 15 years of continuous service.

The Company also has outstanding awards under the 2016 Long Term Incentive Plan (the 2016 Plan), although the 2016 Plan terminated in October 2018 and no additional awards have since been or will be made under the 2016 Plan. The 2016 Plan provided for the granting of SARs, RSAs, RSUs and PSUs, as well as cash-based performance grants, to employees and non-employee directors of the Company.

The Company also has outstanding awards under the Amended and Restated 2004 Long Term Incentive Plan (the 2004 Plan), although the 2004 Plan terminated in October 2016 and no additional awards have since been or will be made under the 2004 Plan. The 2004 Plan provided for the granting of nonqualified stock options, SARs, RSAs, RSUs and PSUs, as well as cash-based performance grants, to employees and non-employee directors of the Company.

Under the 2018 Plan, 2016 Plan and the 2004 Plan, stock-based awards are granted at an exercise price or initial value equal to the fair market value on the date of grant. There were no SARs granted in fiscal year 2021.

Using the fair value of each grant on the date of grant, the weighted average fair values per stock-based compensation award granted during fiscal years 2021, 2020 and 2019 were as follows:


	Fiscal Years
	2021		2020		2019

SOs (1)	$	2.89	$	—	$	—
RSUs (1)	7.15		16.48		21.12
PSUs (1)	5.83		12.09		14.05

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(1)The fair value of market-based SOs granted are estimated on the date of grant using either a Monte Carlo valuation model or a Black-Scholes valuation model. The fair value of market-based RSUs and PSUs granted are estimated on the date of grant using a Monte Carlo valuation model. The significant assumptions used in determining the estimated fair value of the market-based awards granted during fiscal years 2021, 2020 and 2019 were as follows:


	Fiscal Years
	2021		2020		2019

Risk-free interest rate	0.16 - 0.78%		1.43%		2.31 - 2.68%
Expected volatility	44.9 - 66.8%		33.9%		34.2 - 34.6%
Expected dividend yield	—	%	—	%	—	%
Expected term of share options	7.0 years		N/A		N/A

The risk-free interest rate is determined based on the U.S. Treasury rates approximating the expected life of the market-based SOs, RSUs and PSUs granted. Expected volatility is established based on historical volatility of the Company's stock price. The Company uses historical data to estimate pre-vesting forfeiture rates. The expected term is the mid-point between shares vesting and expiration.

Stock-based compensation expense was as follows:


	Fiscal Years
	2021		2020		2019

	(Dollars in thousands)
SARs & SOs	$	456	$	—	$	1,497
RSUs & PSUs	2,798		3,275		7,506
Total stock-based compensation expense (recorded in G&A)	3,254		3,275		9,003
Less: Income tax benefit (1)	—		(688)		(1,891)
Total stock-based compensation expense, net of tax	$	3,254	$	2,587	$	7,112

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(1)Federal statutory income tax rate utilized of 0% due to a valuation allowance in fiscal year 2021 and of 21% utilized in fiscal years 2020 and 2019.

Stock Appreciation Rights & Stock Options:

SARs and SOs granted under the 2018 Plan, 2016 Plan and the 2004 Plan generally vest ratably over a three to five year period on each of the annual grant date anniversaries and expire ten years from the grant date. SARs granted subsequent to fiscal year 2012 vest ratably over a three year period with the exception of the April 2017 grant to the former Chief Executive Officer, which vested in full after two years. The SOs granted during fiscal year 2021 were granted in connection with the appointment of the Company's CEO and consist of options to purchase shares of the Company's common stock. The SOs are subject to both a four-year service-based condition and a performance-based vesting condition. Additionally, 0.4 million SOs are matching options that vest on the fourth anniversary of employment up to the number of RSUs the CEO still holds of the "sign-on" RSUs.

Activity for all the Company's outstanding SARs and SOs is as follows:


	Shares (in thousands)		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life	Aggregate Intrinsic Value (in thousands)
	SARs	SOs

Outstanding balance at June 30, 2020	1,285	—	$	11.79
Granted	—	1,459	6.53
Forfeited/Expired	(187)	—	14.74
Exercised	(57)	—	10.84
Outstanding balance at June 30, 2021	1,041	1,459	$	8.52	7.77	$	2,100
Exercisable at June 30, 2021	1,041	—	$	11.32	5.67	$	(2,040)
Unvested awards, net of estimated forfeitures	—	1,459	$	6.53	9.27	$	4,129

As of June 30, 2021, there was $2.5 million of unrecognized expense related to SOs that is to be recognized over a weighted average period of 4.09 years.

Restricted Stock Units:

RSUs granted to employees under the 2018 Plan, 2016 Plan and 2004 Plan generally vest ratably over a three to five year period on each of the annual grant date anniversaries or vest entirely after a one, three or five year period subsequent to the grant date. The CEO, who was appointed in October 2020, was granted 0.4 million "sign-on" RSUs that vest pro-rata over one year. RSUs granted to non-employee directors under the 2018 Plan, 2016 Plan and 2004 Plan generally vest in equal monthly amounts over a one year period from the Company's previous annual shareholder meeting date and distributions are deferred until the director's board service ends.

Activity for all the Company's RSUs is as follows:


	Shares/Units (in thousands)	Weighted Average Grant Date Fair Value		Aggregate Intrinsic Value (in thousands)
	RSUs

Outstanding balance at June 30, 2020	706	$	17.72
Granted	896	7.15
Forfeited	(231)	16.00
Vested	(196)	16.12
Outstanding balance at June 30, 2021	1,175	$	10.30	$	10,998
Vested at June 30, 2021	262	$	13.76	$	2,452
Unvested awards, net of estimated forfeitures	800	$	8.87	$	7,488

As of June 30, 2021, there was $3.2 million of unrecognized expense related to RSUs that is expected to be recognized over a weighted average period of 1.80 years.

Performance Share Units:

PSUs are grants of restricted stock units which are earned based on the achievement of performance goals established by the Compensation Committee over a performance period.

Activity for all of the Company's PSUs is as follows:


	Shares/Units (in thousands)	Weighted Average Grant Date Fair Value		Aggregate Intrinsic Value (in thousands)
	PSUs

Outstanding balance at June 30, 2020	710	$	13.90
Granted	62	5.83
Forfeited	(602)	13.52
Vested	(6)	25.11
Outstanding balance at June 30, 2021	164	$	12.56	$	1,535
Vested at June 30, 2021	—	$	—	$	—
Unvested awards, net of estimated forfeitures	141	$	10.81	$	1,320

PSUs granted in fiscal year 2021 have a performance period of three years, after which they will vest to the extent earned. There was $0.2 million of total unrecognized compensation expense related to the unvested awards to be recognized over 2.2 years.

PSUs granted in fiscal year 2020 have a performance period of three years, after which they will vest to the extent earned. There was $0.2 million of total unrecognized compensation expense related to the unvested awards to be recognized over 1.2 years.

PSUs granted in fiscal year 2019 have a performance period of three years, ending June 30, 2021. As of June 30, 2021, these awards have not been earned and will not vest.