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Stock-Based Incentive Plan | 3 Months Ended
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Sep. 30, 2021
Share-based Payment Arrangement [Abstract] |
Stock-Based Incentive Plan | Stock-Based Incentive Plan The Evolution Petroleum Corporation 2016 Equity Incentive Plan ("2016 Plan"), approved in the December 2016 annual meeting, authorized the issuance of 1,100,000 shares of common stock prior to its expiration on December 8, 2026. On December 9, 2020, an amendment to the 2016 Plan was approved by our stockholders which increased the number of shares available for issuance by 2,500,000 shares. Incentives under the 2016 Plan may be granted to employees, directors, and consultants of the Company in any one or a combination of the following forms: incentive stock options and non-statutory stock options, stock appreciation rights, restricted stock awards and restricted stock unit awards, performance share awards, performance cash awards, and other forms of incentives valued in whole or in part by reference to, or otherwise based on, our common stock, including its appreciation in value. There were 2,009,354 shares available for grant under the 2016 Plan as of September 30, 2021. Time-Vested Restricted Stock, Performance-Based Restricted Stock and Performance-Based Contingent Shares The Company has primarily granted equity awards with market-based vesting conditions that relate specifically to the price of our common stock, the intrinsic value indexed solely to our common stock and the intrinsic value indexed to our common stock compared to the performance of the common stock of our peers. The awards with market-based vesting conditions are classified as Time-Vested Restricted Stock, Performance-Based Restricted Stock and Performance-Based Contingent Shares. Time-Vested Restricted Stock contain service-based vesting conditions and expire after a maximum of four years from the date of grant if unvested. Performance-Based Restricted Stock contain market-based vesting conditions that are based on the Company’s common stock performance and expire after a maximum of four years from the date of grant if unvested. The common shares underlying the Time-Vested Restricted Stock and Performance-Based Restricted Stock are issued on the date of grant and participate in dividends paid by the Company. Performance-Based Contingent Shares contain market-based vesting conditions that are based on the Company’s common stock performance and expire after a maximum of four years from the date of grant if unvested. The Performance-Based Contingent Shares do not participate in dividends and are only issued upon the attainment of market-based vesting conditions that generally have a lower probability of achievement. Shares underlying Performance-Based Contingent Shares are reserved from the Plan they were granted under. Historically, the Company has granted equity awards with conditions for vesting that are based on Company-specific performance goals such as earnings, revenues, and other operational goals and require that the recipient remain an employee or director of the Company through the vesting date. The Company recognizes compensation expense for awards with Company-performance vesting conditions ratably over the expected vesting period based on the grant date fair value of the Company’s common stock and when it is deemed probable, for accounting purposes, that the performance criteria will be achieved. The expected vesting period may be deemed to be shorter than the term of the award. As of September 30, 2021, there were no awards outstanding with vesting conditions based on Company-specific performance goals such as earnings, revenues, and other operational goals. During three months ended September 30, 2021, a total of 196,940 equity awards were granted related to our fiscal year 2022 long-term incentive pay program that included 65,647 shares of Time-Vested Restricted Stock, which vests in three equal amounts on June 30, 2022, 2023 and 2024, and 131,293 shares of Performance-Based Restricted Stock. No equity awards were granted during the three months ended September 30, 2020. Time-Vested Restricted Stock shares are service-based awards that vest with continuous employment by the Company, generally in annual installments over terms of three to four years. Awards to the Company's directors have one-year cliff vesting. Time-Vested Restricted Stock grants are valued at the fair market value of the Company's common stock on the date of grant and amortized over the service period. Performance-Based Restricted Stock and Performance-Based Contingent Share grants vest if the trailing total returns on the Company’s common stock for a specified three-year period exceed the corresponding total returns of various quartiles of indices consisting of peer companies. Additionally, some Performance-Based Contingent Shares vest when the average of the Company's closing common stock price over a defined quarterly measurement period meets or exceeds a required common stock price. The Company utilizes third-party independent assessments of fair values and expected vesting periods of these awards that are determined using a Monte Carlo simulation based on the historical volatility of the Company's total return compared to the historical volatilities of the other peer companies in the index. Compensation expense for awards with market-based vesting conditions is based on the fair value of the awards at the date of grant and recognized over the expected vesting period using the straight-line method, so long as the holder remains an employee or director of the Company. Previously recognized compensation expense is only reversed for the awards with market-based vesting conditions if the requisite service period is not rendered and the award is forfeited by the holder. No equity awards were granted during the three months ended September 30, 2020. For market-based awards granted during the three months ended September 30, 2021, the assumptions used in the Monte Carlo simulation valuations, expected lives and fair values were as follows:
| September 30, |  | September 30,
| 2021 |  | 2020
Weighted average fair value of market-based awards granted | $ | 3.31 |  |  | $ | — |
Risk-free interest rate | 0.53 | % |  | — | %
Expected vesting term in years | 3 |  | 0
Expected volatility | 64.7 | % |  | — | %
Dividend yield | 6.3 | % |  | — | %
Unvested Restricted Stock awards at September 30, 2021 consisted of the following:
| Number of Restricted Shares |  | Weighted Average Grant-Date Fair Value
Time-Vested Restricted Stock awards | 342,341 |  |  | $ | 3.56 |
Performance-Based Restricted Stock awards | 389,594 |  |  | 3.34 |
Unvested Restricted Stock at September 30, 2021 | 731,935 |  |  | $ | 3.44 |
The following table sets forth the Restricted Stock transactions for the three months ended September 30, 2021:
| Number of Restricted Shares |  | Weighted Average Grant-Date Fair Value |  | Unamortized Compensation Expense at September 30, 2021 |  | Weighted Average Remaining Amortization Period (Years)
Unvested at July 1, 2021 | 669,295 |  |  | $ | 3.37 |  |  |  |  |
Time-Vested Restricted Stock shares granted | 65,647 |  |  | 4.77 |  |  |  |  |
Performance-Based Restricted Stock shares granted | 131,293 |  |  | 3.31 |  |  |  |  |
Vested | (54,510) |  |  | 3.71 |  |  |  |  |
Forfeited and expired | (79,790) |  |  | 3.47 |  |  |  |  |
Unvested Restricted Stock at September 30, 2021 | 731,935 |  |  | $ | 3.44 |  |  | $ | 1,932,587 |  |  | 2.16
Unvested Performance-Based Contingent Share awards in table below consists solely of market-based awards:
| Number of Contingent Restricted Shares |  | Weighted Average Grant-Date Fair Value |  | Unamortized Compensation Expense at September 30, 2021 |  | Weighted Average Remaining Amortization Period (Years)
Unvested at July 1, 2021 | 323,080 |  |  | $ | 2.84 |  |  |  |  |
Forfeited | (22,640) |  |  | $ | 1.76 |  |  |  |  |
Unvested contingent shares at September 30, 2021 | 300,440 |  |  | $ | 2.92 |  |  | $ | 120,692 |  |  | 1.74
Stock-based compensation expense related to Time-Vested Restricted Stock, Performance-Based Restricted Stock, and Performance-Based Contingent Shares for the three months ended September 30, 2021 and 2020 was $197,826 and $300,351, respectively.

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