15. Stock Options

12 Months Ended

Jun. 30, 2022

15. Stock Options

Stock Options

15. Stock Options

2012 Plan

The Company’s 2012 Plan expired in February 2022, which provided for the grant of options to purchase up to 1,193,000 shares of the Company’s Common Stock, par value $.05 per share (“Common Stock”), plus up to 57,000 shares under options previously granted under the 2002 Stock Option Plan of the Company (the “Prior Plan”).

The 2012 Plan provided for the granting of incentive or non-incentive stock options. Incentive stock options may be granted to employees at an exercise price equal to 100% (or 110% if the optionee owns directly or indirectly more than 10% of the outstanding voting stock) of the fair market value of the shares of Common Stock on the date of the grant. Non-incentive stock options shall be granted at the fair market value of the shares of Common Stock on the date of grant.

2022 Plan

The Company’s 2022 Plan provides for the issuance of up to 1,750,000 shares of the Company’s Common Stock, par value $.05 per share, plus outstanding options granted under the Company’s 2012 Stock Option Plan that expire or are forfeited. Incentive stock options may be granted to employees at an exercise price equal to 100% (or 110% if the optionee owns directly or indirectly more than 10% of the outstanding voting stock) of the fair market value of the shares of Common Stock on the date of the grant. Nonstatutory stock options shall be granted at the fair market value of the shares of Common Stock on the date of grant. As of June 30, 2022, 1,832,113 shares of Common Stock were available for grant of options under the 2022 Plan, of which 142,113 shares of Common Stock are from either terminated or expired options from the 2012 Plan.

During the years ended June 30, 2022 and 2021, the Company granted 60,000 and 1,094,171 options under the 2012 Plan, respectively, to employees that had a fair value of $268,848 and $7,929,600, respectively. During the year ended June 30, 2022 the Company granted 60,000 options under the 2022 Plan, to employees that had a fair value of $262,372.

The following table summarizes the weighted-average assumptions used for the Black-Scholes option pricing model to determine the fair value of our stock options for the years ended June 30, 2022 and 2021, respectively:

	Year Ended			Year Ended
	June 30, 2022			June 30, 2021
Expected term (in years)		10			10
Risk-free interest rate		1.91	%		1.40	%
Expected volatility		72	%		66	%
Dividend rate		0			0

Total stock-based compensation costs were $2,350,600 and $2,108,000 for the years ended June 30, 2022 and 2021, respectively. Stock-based compensation costs related to nonvested awards expected to be recognized in the future are $3,187,300 and $5,935,000 as of June 30, 2022 and 2021, respectively. The weighted-average period over which the nonvested awards is expected to be recognized are 1.51 years and 2.27 years as of June 30, 2022 and 2021, respectively. 

The following table summarizes option activity under all plans during the years ended June 30, 2022 and 2021:

	Year Ending
	June 30, 2022					June 30, 2021
Shares under option:	Shares			Weighted-Average Exercise Price		Shares			Weighted-Average Exercise Price
Outstanding, beginning of year		1,180,757		$	8.73		96,586		$	4.35
Granted		120,000			5.78		1,094,171			9.07
Exercised		-			-		(1,000	)		3.05
Forfeited		(142,113	)		8.98		(9,000	)		3.11
Outstanding, end of year		1,158,644		$	8.40		1,180,757		$	8.73
Options exercisable at year-end		567,594		$	8.13		296,821		$	7.69
Weighted average fair value per share of options granted during the fiscal year				$	4.43				$	7.25

	As of June 30, 2022 Options Outstanding						As of June 30, 2022 Exercisable
Range Exercise Price	Number Outstanding		Remaining Contractual Life (Years)		Average Exercise Price		Number Outstanding		Average Exercise Price
$5.35 - $ 11.30		1,097,939		8.34	$	8.68		506,889	$	8.70
$2.91 - $ 4.65		60,705		4.51	$	3.37		60,705	$	3.37
		1,158,644						567,594

	As of June 30, 2021 Options Outstanding						As of June 30, 2021 Exercisable
Range Exercise Price	Number Outstanding		Remaining Contractual Life (Years)		Average Exercise Price		Number Outstanding		Average Exercise Price
$5.35 - $ 11.30		1,120,052		9.35	$	9.03		238,351	$	8.76
$2.91 - $ 4.65		60,705		5.28	$	3.36		58,470	$	3.32
		1,180,757						296,821