STOCKHOLDERS EQUITY

6 Months Ended

Dec. 31, 2021

Stockholders' equity:

(13) STOCKHOLDERS EQUITY

(13) STOCKHOLDERS’ EQUITY

Financing Transactions – On June 21, 2019, the Company entered into an equity distribution agreement (the “2019 Equity Distribution Agreement”) with Canaccord Genuity LLC (“Canaccord”), pursuant to which the Company may, from time to time, sell shares of the Company’s common stock at market prices by methods deemed to be an “at-the-market offering” as defined in Rule 415 promulgated under the Securities Act of 1933, as amended. The 2019 Equity Distribution Agreement and related prospectus is limited to sales of up to an aggregate maximum $40.0 million of shares of the Company’s common stock. The Company pays Canaccord 3.0% of the gross proceeds as a commission.

No proceeds were raised under the 2019 Equity Distribution Agreement during the three and six months ended December 31, 2021 and 2020.

Stock Purchase Warrants – During the three and six months ended December 31, 2021, the Company received $280,000 and issued 350,000 shares of common stock upon the exercise provisions of 350,000 Series J warrants at an exercise price of $0.80 per share.

Stock Options – For the three and six months ended December 31, 2021, the Company recorded stock-based compensation related to stock options of $380,735 and $779,547, respectively. For the three and six months ended December 31, 2020, the Company recorded stock-based compensation related to stock options of $473,963 and $955,785, respectively.

A summary of stock option activity is as follows:

	Number of Shares			Weighted Average Exercise Price		Weighted Average Remaining Term in Years		Aggregate Intrinsic Value
Outstanding - June 30, 2021		21,882,500		$	0.72		7.2	$	1,034,273
Granted		103,150			0.49
Forfeited		(118,152	)		0.70
Exercised		(43,600	)		0.37
Expired		(73,349	)		0.70
Outstanding - December 31, 2021		21,750,549		$	0.72		6.7	$	373,722
Exercisable at December 31, 2021		13,571,910		$	0.75		5.6	$	370,833
Expected to vest at December 31, 2021		8,178,639		$	0.68		8.6	$	2,889

Stock options granted to the Company’s executive officers and employees generally vest over a 48-month period, while stock options granted to its non-employee directors vest over a 12-month period.

Included in the outstanding options in the table above are 1,605,573 and 332,785 unvested performance-based stock options granted to executive officers and other employees, respectively, which were granted in June 2020 and 2021. The performance-based stock options vest on annual performance criteria through the fiscal years ending June 30, 2025 relating to advancement of MC1r programs, including initiation of clinical trials and licensing of Vyleesi in additional countries or regions.

Restricted Stock Units – For the three and six months ended December 31, 2021, the Company recorded stock-based compensation related to restricted stock units of $242,706 and $476,621, respectively. For the three and six months ended December 31, 2020, the Company recorded stock-based compensation related to restricted stock units of $388,720 and $728,072, respectively.

A summary of restricted stock unit activity is as follows:

Outstanding at June 30, 2021	14,840,762
Granted	-
Forfeited	(81,117	)
Vested	(1,624,158	)
Outstanding at December 31, 2021	13,135,487

Included in outstanding restricted stock units in the table above are 7,123,500 vested shares that have not been issued as of December 31, 2021 due to a provision in the restricted stock unit agreements to delay delivery.

Time-based restricted stock units granted to the Company’s executive officers, employees, and non-employee directors generally vest over 48 months, 48 months, and 12 months, respectively.

Included in the outstanding restricted stock units in the table above are 1,630,020 and 275,208 unvested performance-based restricted stock units granted to executive officers and other employees, respectively, which were granted in June 2019, 2020, and 2021. The performance-based restricted stock units vest on annual performance criteria through the fiscal years ending June 30, 2025 relating to advancement of MC1r programs, including initiation of clinical trials and licensing of Vyleesi in additional countries or regions.

In June 2021, the Company granted 450,000 performance-based restricted stock units included in the table above to its executive officers which vest if, prior to June 22, 2023, the price per share of the Company’s common stock, as traded on the NYSE American, was at least $2.00 for at least twenty consecutive trading days.

In connection with the vesting of restricted share units during the six months ended December 31, 2021, the Company withheld 372,176 shares with aggregate values of $208,270 in satisfaction of minimum tax withholding obligations.