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StockBased Compensation
 6 Months Ended
Dec. 31, 2023
StockBased Compensation  
Stock-based Compensation

9. Stock-Based Compensation

 

Our directors, officers, and key employees are granted stock-based compensation through our Amended and Restated Omnibus Incentive Plan, as amended (the “Omnibus Plan”), through October 2018 and after that date, through our 2018 Stock and Incentive Compensation Plan (the “SICP”). Such stock-based compensation may include, among other things, incentive stock options, non-qualified stock options, restricted stock awards (“RSAs”) and restricted stock units (“RSUs”). The SICP is administered by the Compensation Committee of the Board of Directors. At our 2018 Annual Stockholders Meeting, our stockholders approved the SICP under which an aggregate of 1,650,870 shares of our Class A common stock were authorized for issuance pursuant to awards granted thereunder. At our 2022 Annual Stockholders Meeting, our stockholders authorized an additional 2,100,000 shares of our Class A common stock for issuance pursuant to awards granted thereunder. As of December 31, 2023, 1,488,881 shares of Class A common stock were authorized and available for issuance pursuant to awards granted under the SICP. The Company’s executive officers are eligible to earn incentive compensation consisting of equity-based awards, as well as cash bonuses, based on the achievement of certain individual and/or Company performance goals set by the Compensation Committee.

Stock-based compensation expense is based primarily on the fair value of the award as of the grant date, and is recognized as an expense over the requisite service period.

 

The following table shows total stock-based compensation expense for the three and six months ended December 31, 2023 and 2022, the majority of which is included in selling, general and administrative (“SG&A”) expenses in these unaudited Condensed Consolidated Statements of Comprehensive Income (Loss):

 

 

 

Three Months Ended December 31,

 

 

Six Months Ended December 31,

 

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock options

 

$30,037

 

 

$59,284

 

 

$61,515

 

 

$118,049

 

RSAs

 

 

108,922

 

 

 

66,850

 

 

 

131,309

 

 

 

66,850

 

RSUs

 

 

172,820

 

 

 

361,413

 

 

 

359,030

 

 

 

587,246

 

Total

 

$311,779

 

 

$487,547

 

 

$551,854

 

 

$772,145

 

   

We also adopted the LightPath Technologies, Inc. Employee Stock Purchase Plan (the “2014 ESPP”). The 2014 ESPP permits employees to purchase Class A common stock through payroll deductions, subject to certain limitations. A discount of approximately $2,000 for each of the six months ended December 31, 2023 and 2022, respectively, is included in SG&A expenses in these unaudited Condensed Consolidated Statements of Comprehensive Income (Loss), which represents the value of the 10% discount given to the employees purchasing stock under the 2014 ESPP.

 

Grant Date Fair Values and Underlying Assumptions; Contractual Terms

 

We estimate the fair value of each stock option as of the date of grant, using the Black-Scholes-Merton pricing model. The fair value of 2014 ESPP shares is the amount of the discount the employee obtains at the date of the purchase transaction.

 

Most stock options granted vest ratably over two to four years and are generally exercisable for ten years. The assumed forfeiture rates used in calculating the fair value of RSA and RSU grants was 0%, and the assumed forfeiture rates used in calculating the fair value of options for performance and service conditions were 20% for each of the six months December 31, 2023 and 2022. The volatility rate and expected term are based on seven-year historical trends in Class A common stock closing prices and actual forfeitures. The interest rate used is the U.S. Treasury interest rate for constant maturities.

 

No stock options were granted during either of the six-month periods ended December 31, 2023 or December 31, 2022.

 

Restricted Stock Awards

 

RSAs are granted primarily to our executive officers, employees and consultants, and typically vest over a one to three year period from the date of grant, although some may vest immediately upon grant. The stock underlying RSAs is issued upon vesting.

 

Restricted Stock Units

 

RSUs are granted primarily to our directors, although RSU awards may also be made to executive officers, employees and consultants. RSUs typically vest over a one to four year period from the date of grant, although some may vest immediately upon grant.

Information Regarding Current Share-Based Compensation Awards

 

A summary of the activity for share-based compensation awards in the six months ended December 31, 2023 is presented below:

 

 

 

 Stock Options

 

 

 Restricted Stock Units (RSUs)

 

 

 Restricted Stock Awards (RSAs)

 

 

 

 

 

 

Weighted-

 

 

Weighted-

 

 

 

 

 

Weighted-

 

 

 

 

 

Weighted-

 

 

 

 

 

 

Average

 

 

Average

 

 

 

 

 

Average

 

 

 

 

 

Average

 

 

 

 

 

 

Exercise

 

 

Remaining

 

 

 

 

 

Remaining

 

 

 

 

 

Remaining

 

 

 

 Shares

 

 

 Price

 

 

 Contract

 

 

 Shares

 

 

 Contract

 

 

 Shares

 

 

 Contract

 

June 30, 2023

 

 

534,462

 

 

$2.03

 

 

 

6.1

 

 

 

1,596,222

 

 

 

1.1

 

 

 

101,733

 

 

 

0.7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Granted

 

 

—

 

 

 

—

 

 

 

 

 

 

 

15,448

 

 

 

 

 

 

 

134,674

 

 

 

 

 

Exercised

 

 

—

 

 

 

—

 

 

 

 

 

 

 

(15,448)

 

 

 

 

 

 

(111,666)

 

 

 

 

Cancelled/Forfeited

 

 

—

 

 

 

—

 

 

 

 

 

 

 

—

 

 

 

 

 

 

 

(5,465)

 

 

 

 

December 31, 2023

 

 

534,462

 

 

$2.03

 

 

 

5.6

 

 

 

1,596,222

 

 

 

1.1

 

 

 

119,276

 

 

 

0.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Awards exercisable/

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

vested as of

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2023

 

 

401,316

 

 

$1.97

 

 

 

5.3

 

 

 

1,309,249

 

 

 

—

 

 

 

—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Awards unexercisable/

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

unvested as of

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2023

 

 

133,146

 

 

$2.19

 

 

 

6.6

 

 

 

286,973

 

 

 

1.1

 

 

 

119,276

 

 

 

0.4

 

 

 

 

534,462

 

 

 

 

 

 

 

 

 

 

 

1,596,222

 

 

 

 

 

 

 

119,276

 

 

 

 

 

  

As of December 31, 2023, there was approximately $483,000 of total unrecognized compensation cost related to non-vested share-based compensation arrangements (including stock options, RSAs and RSUs) granted. We expect to recognize the compensation cost as follows:

 

Fiscal Year Ending:

 

Stock Options

 

 

RSAs

 

 

RSUs

 

 

Total

 

June 30, 2024 (remaining six months)

 

$

31,923

 

 

$

43,392

 

 

$

121,663

 

 

$

196,978

 

June 30, 2025

 

 

33,885

 

 

 

66,219

 

 

 

130,589

 

 

 

230,693

 

June 30, 2026

 

 

—

 

 

 

27,777

 

 

 

19,829

 

 

 

47,606

 

June 30, 2027

 

 

—

 

 

 

7,500

 

 

 

—

 

 

 

7,500

 

 

 

$65,808

 

 

$144,888

 

 

$272,081

 

 

$482,777