Stock-Based Compensation

9 Months Ended

Mar. 31, 2021

Share-based Payment Arrangement [Abstract]

The Company adopted a long term incentive plan which became effective on January 1, 2014, and reserves for issuance up to 1,700,000 shares of Malibu Boats, Inc. Class A Common Stock for the Company’s employees, consultants, members of its board of directors and other independent contractors at the discretion of the compensation committee. Incentive stock awards authorized under the Incentive Plan include unrestricted shares of Class A Common Stock, stock options, stock appreciation rights, restricted stock, restricted stock units, dividend equivalent awards and performance awards. As of March 31, 2021, 596,372 shares remain available for future issuance under the long term incentive plan.

On November 3, 2020, under the Incentive Plan, the Company granted approximately 33,000 restricted service based stock units and 25,000 restricted service based stock awards to key employees under the Incentive Plan. The grant date fair value of these awards was $3,145 based on a stock price of $54.47 per share on the date of grant. Approximately 58% of the awards vest ratably over three years and approximately 42% of the awards vest ratably over four years. Stock-based compensation expense attributable to the service based units and awards is amortized on a straight-line basis over the requisite service period.

On November 3, 2020, under the Incentive Plan, the Company granted to key employees a target amount of approximately 18,000 restricted stock awards with a performance condition. The number of shares that will ultimately be issued, if any, is based on the attainment of a specified amount of earnings during the fiscal year ending June 30, 2023. The maximum number of shares that can be issued if an elevated earnings target is met is approximately 28,000. The grant date fair value of the awards were estimated to be $1,002, based on a stock price of $54.47. Compensation costs associated with the performance awards are recognized over the requisite service period based on probability of achievement in accordance with ASC Topic 718, Compensation—Stock Compensation.

On November 3, 2020, under the Incentive Plan, the Company granted to key employees a target amount of approximately 18,000 stock awards with a market condition. The number of shares that will ultimately be issued, if any, is based on a total shareholder return ("TSR") computation that involves comparing the movement in the Company's stock price to movement in a market index from the grant date through November 6, 2023. The maximum number of shares that can be issued if an elevated TSR target is met is approximately 37,000. The grant date fair value of the awards were estimated to be $1,293, which is estimated using a Monte Carlo simulation. The Monte Carlo simulation model utilizes multiple input variables that determine the probability of satisfying the market condition stipulated in the award grant and calculates the fair market value for the stock award. Compensation costs are recognized over the requisite service period based on probability of achievement in accordance with ASC Topic 718, Compensation—Stock Compensation.

The following is a summary of the changes in the Company's stock options for the nine months ended March 31, 2021:



	Shares	Weighted Average Exercise Price/Share
Total outstanding options as of June 30, 2020	173,348	$	32.61
Options granted	—	—
Options exercised	(11,625)	32.24

Outstanding options as of March 31, 2021	161,723	32.64
Exercisable as of March 31, 2021	85,737	$	31.67

The following is a summary of the changes in non-vested restricted stock units and restricted stock awards for the nine months ended March 31, 2021:


	Number of Restricted Stock Units and Restricted Stock Awards Outstanding	Weighted Average Grant Date Fair Value
Total Non-vested Restricted Stock Units and Restricted Stock Awards as of June 30, 2020	277,696	$	35.43
Granted	140,916	54.83
Vested	(92,766)	32.51
Forfeited	(4,237)	41.51
Total Non-vested Restricted Stock Units and Restricted Stock Awards as of March 31, 2021	321,609	$	44.69

Stock compensation expense attributable to the Company's share-based equity awards was $1,449 and $816 for the three months ended March 31, 2021 and 2020, respectively, and $4,060 and $2,306 for the nine months ended March 31, 2021 and 2020. Stock compensation expense attributed to share-based equity awards issued under the Incentive Plan is recognized on a straight-line basis over the terms of the respective awards and is included in general and administrative expense in the Company's unaudited interim condensed consolidated statement of operations and comprehensive income. Awards vesting during the three and nine months ended March 31, 2021 include 947 and 12,898 fully vested restricted stock units issued to non-employee directors for their service as directors for the Company.