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Stock Based Compensation
 3 Months Ended
Sep. 30, 2025
Stock Based Compensation  
Stock-based Compensation

10. Stock-Based Compensation

 

Our directors, officers, and key employees are granted stock-based compensation through our 2002 Amended and Restated Omnibus Incentive Plan, as amended (the “2002 Omnibus Plan”), through October 2018 and after that date, through our 2018 Stock and Incentive Compensation Plan (the “2018 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 2018 SICP is administered by the Compensation Committee of the Board of Directors. To date, our stockholders approved an aggregate of 11,215,625 shares of our Class A Common Stock for issuance pursuant to awards granted under the 2002 Omnibus Plan or SICP. As of September 30, 2025, 4,158,204 shares of Class A Common Stock were authorized and available for issuance pursuant to awards granted under the 2018 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 months ended September 30, 2025 and 2024, 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

September 30,

 

 

 

2025

 

 

2024

 

Stock options

 

$50,607

 

 

$146,979

 

RSAs

 

 

63,186

 

 

 

10,809

 

RSUs

 

 

242,829

 

 

 

106,687

 

Total

 

$356,622

 

 

$264,475

 

 

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. The discount for the three months ended September 30, 2024 was $1,100, 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.  The 2014 ESPP expired in January 2025. A new Employee Stock Purchase Plan (“2025 ESPP”) was approved by the stockholders on June 16, 2025 with the first offering period beginning July 1, 2025. The first purchase of shares under the 2025 ESPP will occur immediately after the offering period ends December 31, 2025.

 

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 and 2025 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 three months ended September 30, 2025 and 2024. 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.

 

The Company estimated the fair value of each stock award as of the date of grant using the following assumptions:

 

 

 

Three Months

 Ended

September 30,

2025

 

Weighted-average expected volatility

 

 

74.0%

Dividend yields

 

 

0%

Weighted-average risk-free interest rate

 

 

4.05%

Weighted-average expected term, in years

 

 

7.50

 

 

No stock options were granted during the three months ended September 30, 2024.

 

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 three months ended September 30, 2025 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, 2025

 

 

720,619

 

 

$2.10

 

 

 

7.2

 

 

 

1,080,953

 

 

 

0.6

 

 

 

121,912

 

 

 

1.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Granted

 

 

27,717

 

 

$4.17

 

 

 

 

 

 

 

—

 

 

 

 

 

 

 

8,583

 

 

 

 

 

Exercised

 

 

—

 

 

 

 

 

 

 

 

 

 

 

—

 

 

 

 

 

 

 

(8,583)

 

 

 

 

Cancelled/Forfeited

 

 

(9,579)

 

$1.74

 

 

 

 

 

 

 

—

 

 

 

 

 

 

 

—

 

 

 

 

 

September 30, 2025

 

 

738,757

 

 

$2.13

 

 

 

7.2

 

 

 

1,080,953

 

 

 

0.5

 

 

 

121,912

 

 

 

0.9

 

Awards exercisable/

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

vested as of

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30, 2025

 

 

363,081

 

 

$1.99

 

 

 

4.7

 

 

 

718,739

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Awards unexercisable/

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

unvested as of

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30, 2025

 

 

375,676

 

 

$2.26

 

 

 

9.6

 

 

 

362,214

 

 

 

0.5

 

 

 

121,912

 

 

 

0.9

 

 

 

 

738,757

 

 

 

 

 

 

 

 

 

 

 

1,080,953

 

 

 

 

 

 

 

121,912

 

 

 

 

 

 

As of September 30, 2025, there was approximately $1.0 million of total unrecognized compensation cost related to non-vested share-based compensation arrangements (including stock options, RSAs and RSUs) granted. The expected compensation cost to be recognized is as follows:

 

Fiscal Year Ending:

 

Stock Options

 

 

RSAs

 

 

RSUs

 

 

Total

 

June 30, 2026 (remaining nine months)

 

$145,855

 

 

$72,607

 

 

$228,122

 

 

$446,584

 

June 30, 2027

 

 

194,880

 

 

 

47,062

 

 

 

110,083

 

 

 

352,025

 

June 30, 2028

 

 

161,664

 

 

 

-

 

 

 

18,252

 

 

 

179,916

 

 

 

$502,399

 

 

$119,669

 

 

$356,457

 

 

$978,525