Stock-Based Compensation Plans

6 Months Ended

Dec. 31, 2019

Equity [Abstract]

Stock-Based Compensation Plans

10. Stock-Based Compensation Plans

Stock Option Awards

For the three and six months ended December 31, 2019 and 2018, the compensation cost relating to stock option awards that has been charged against income for the Company's stock option plans, excluding the compensation cost for restricted stock, was $281,023 and $502,358, and $500,087 and $844,601, respectively. As of December 31, 2019, there was approximately $3.9 million of total unrecognized compensation cost related to non-vested share-based compensation arrangements to be recognized over a weighted-average period of 3.1 years.

Stock options typically expire 10 years from the date of grant and vest over service periods, which typically are 4 years. All options are granted at fair market value, as defined in the applicable plans. 

The fair value of each option award was estimated on the date of grant using the Black-Scholes option valuation model that uses the assumptions noted in the following table. The expected volatility represents the historical price changes of the Company's stock over a period equal to that of the expected term of the option. The Company uses the simplified method for determining the option term. The risk-free rate was based on the U.S. Treasury yield curve in effect at the time of grant. The expected dividend yield is based upon historical and projected dividends. The Company has historically not paid dividends, and it does not expect to do so in the near term.

There were options to purchase 185,500 and 182,000 shares granted during the six months ended December 31, 2019 and 2018, respectively. The fair value was estimated based on the weighted average assumptions of:

	For the six months ended
	December 31,
	2019			2018
Risk-free interest rates		1.67	%		2.90	%
Expected option life in years		6.25			6.25
Expected stock price volatility		54.69	%		55.87	%
Expected dividend yield		0	%		0	%

A summary of option activity under the Company's equity plans as of December 31, 2019, and changes during the six months ended December 31, 2019 is presented below:

	Options
				Weighted
				Average		Aggregate
	Outstanding			Exercise		Intrinsic
	Shares			Price		Value
Vested and exercisable at June 30, 2019		1,163,856		$	10.28	$	19,409,569
Granted		185,500			21.41
Exercised		(141,750	)		8.29
Forfeited		(47,500	)		13.99
Expired		-			-
Outstanding as of December 31, 2019		1,160,106		$	12.15	$	8,084,272
Vested and exercisable at December 31, 2019		663,979		$	8.94	$	6,420,769

The total fair value of stock options vested during the six months ended December 31, 2019 was $863,924. The number and weighted-average grant-date fair value of non-vested stock options at December 31, 2019 was 496,127 and $8.93, respectively. The number and weighted-average grant-date fair value of stock options which vested during the six months ended December 31, 2019 was 148,999 and $5.80, respectively.

Restricted Stock Awards

On December 15, 2016, the Company issued 400,000 shares of restricted stock to its Chief Executive Officer. These awards vest over a period of up to five years, subject to meeting certain service, performance and market conditions. These awards were valued at approximately $3.6 million. Compensation expense recorded in the three and six months ended December 31, 2019 and 2018 related to these awards was $123,629 and $144,953, and $247,378 and $871,329, respectively. As of December 31, 2019, there was approximately $886,365 of total unrecognized compensation cost related to non-vested restricted stock awards to be recognized over a weighted-average period of 1.82 years. The awards contain a combination of vesting terms that include time vesting, performance vesting relating to revenue achievement, and market vesting related to obtaining certain levels of Company stock prices. At December 31, 2019, the Company has estimated that it is probable that the performance conditions will be met. The awards were valued using a Monte Carlo valuation model using a stock price at the date of grant of $9.60, a term of 3 to 5 years, a risk-free interest rate of 1.6% to 2.1% and a volatility factor of 66.5%. As of December 31, 2019, 186,600 shares from this set of awards have vested.