Stock-Based Compensation

3 Months Ended

Sep. 30, 2020

Share-based Payment Arrangement [Abstract]

Stock Compensation Accounting

The weighted average estimated fair value of option awards granted was $31.11 and $33.15 during the three months ended September 30, 2020 and 2019, respectively.

We utilized the Black-Scholes option valuation model with the following weighted average assumptions:


	Three Months Ended September 30,
	2020		2019
Risk-free interest rate	0.3	%	1.5	%
Expected dividend yield	0.0	%	0.0	%
Expected life (in years)	5.3		4.5
Expected volatility factor	32.7	%	26.8	%

The stock-based compensation expense under all equity plans and its classification in the unaudited consolidated statements of operations for the three months ended September 30, 2020 and 2019 are as follows:


	Three Months Ended September 30,
	2020		2019
	(Dollars in Thousands)
Recorded as expenses:
Cost of maintenance	$	316	$	398
Cost of services and other	450		543
Selling and marketing	1,244		1,547
Research and development	1,722		2,102
General and administrative	2,536		4,685
Total stock-based compensation	$	6,268	$	9,275

A summary of stock option and restricted stock unit ("RSU") activity under all equity plans for the three months ended September 30, 2020 is as follows:


	Stock Options						Restricted Stock Units
	Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value (in 000’s)		Shares	Weighted Average Grant Date Fair Value
Outstanding at June 30, 2020	1,410,139	$	76.19	6.67	$	49,705	352,921	$	112.45
Granted	7,929	105.42					5,103	107.20
Settled (RSUs)	—						(40,095)	96.65
Exercised	(12,943)	24.38					—
Cancelled / Forfeited	(4,644)	126.62					(2,985)	124.78
Outstanding at September 30, 2020	1,400,481	$	76.65	6.27	$	71,762	314,944	$	114.27
Vested and exercisable at September 30, 2020	1,012,572	$	62.08	5.61	$	65,829	—
Vested and expected to vest as of September 30, 2020	1,357,921	$	75.46	6.21	$	71,128	279,100	$	114.20

The weighted average grant-date fair value of RSUs granted was $107.20 and $133.15 during the three months ended September 30, 2020 and 2019, respectively. The total fair value of shares vested from RSU grants was $5.1 million and $10.5 million during the three months ended September 30, 2020 and 2019, respectively.

At September 30, 2020, the total future unrecognized compensation cost related to stock options was $8.8 million and is expected to be recorded over a weighted average period of 2.2 years. At September 30, 2020, the total future unrecognized compensation cost related to RSUs was $27.8 million and is expected to be recorded over a weighted average period of 2.2 years. Amounts represent compensation cost, net of estimated forfeitures.

The total intrinsic value of options exercised was $1.0 million and $1.3 million during the three months ended September 30, 2020 and 2019, respectively. We received cash proceeds from option exercises of $0.3 million and $1.0 million during the three months ended September 30, 2020 and 2019, respectively. We withheld taxes on vested RSUs of $1.8 million and $3.4 million during the three months ended September 30, 2020 and 2019, respectively.

As of September 30, 2020, common stock reserved for future issuance under equity compensation plans was 6.0 million shares.

Employee Stock Purchase Plan

On July 26, 2018, our Board of Directors approved the Aspen Technology, Inc. 2018 Employee Stock Purchase Plan (the "ESPP"), which provides for the issuance of up to 250,000 shares of common stock to participating employees. The ESPP is intended to be a qualified employee stock purchase plan under Section 423 of the Internal Revenue Code of 1986, or the IRC. The ESPP was approved at our Annual Meeting of Stockholders on December 7, 2018. The ESPP currently provides for a purchase price equal to 85% of the lower of (a) the fair market value of the common stock on the first trading day of each ESPP offering period and (b) the fair market value of the common stock on the last day of the offering period. Our initial offering period was January 1, 2019 through June 30, 2019. Our current offering period is July 1, 2020 through December 31, 2020.

During the three months ended September 30, 2020 and 2019, we recorded stock-based compensation expense of approximately $0.2 million and $0.1 million, respectively, associated with the ESPP. As of September 30, 2020, there were 217,739 shares of common stock available for issuance under the ESPP.