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Stockholders' Equity | 6 Months Ended
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Dec. 31, 2024
Stockholders' Equity |
Stockholders' Equity | Note 11. Stockholders’ Equity Common Stock As of December 31, 2024, the Company had 34,076,846 shares of common stock outstanding. The Company began paying quarterly cash dividends on common stock in December 2013. As of December 31, 2024, the Company has cumulatively paid over $126.6 million in cash dividends. The Company paid dividends of $8.1 million and $8.0 million to its common stockholders during the six months ended December 31, 2024 and 2023, respectively. The following table reflects the dividends paid per share within the respective three-month periods:
​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Fiscal Year
​ |  | 2025 |  | 2024
Second fiscal quarter | ​ | $ | 0.120 | ​ | $ | 0.120
First fiscal quarter | ​ | ​ | 0.120 | ​ | ​ | 0.120
​ On October 21, 2024, the Company entered into an At-the-Market (“ATM”) equity Sales Agreement (the “ATM Sales Agreement”) with Roth Capital Partners, LLC (the “Lead Agent”), Northland Securities Inc., and A.G.P./Alliance Global Partners pursuant to which the Company may issue and sell, from time to time, up to $30.0 million of shares of common stock through or to the Lead Agent, acting as agent or principal. During the period ended December 31, 2024, the Company sold a total of approximately 0.4 million shares of its common stock under the ATM Sales Agreement for net proceeds of approximately $2.0 million, after deducting an initial $0.2 million in fees for due diligence incurred with the offering. The Company intends to use the net proceeds from any sales of common stock for general corporate purposes, including to redeem or repay outstanding indebtedness. The Company is not obligated to sell any shares of common stock in the future. On September 8, 2022, the Board of Directors approved a share repurchase program, under which the Company was authorized to repurchase up to $25.0 million of its common stock in the open market through December 31, 2024. The Company funded repurchases from working capital and cash provided by operating activities. The share repurchase program was complimentary to the existing dividend policy and was a tax efficient means to further improve shareholder return. The shares were repurchased from time to time in open market transactions, through privately negotiated transactions or by other means in accordance with federal securities laws. The Company repurchased a total of 0.8 million shares of its common stock under the program at a total cost of approximately $4.6 million, including incremental direct transaction costs. During the six months ended December 31, 2024 and 2023, the Company acquired treasury stock upon the ordinary course of scheduled vestings of employee stock-based awards to fund payroll tax withholding obligations. These treasury shares were subsequently cancelled. Such shares were valued at fair market value on the date of vesting. ​ The following table summarizes all treasury stock purchases during the six months ended December 31, 2024 and 2023 (in thousands, except per share amounts):
​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Six Months Ended
​ | ​ | December 31,
​ |  | 2024 | ​ | 2023
Number of treasury shares acquired | ​ | ​ | 36 | ​ | ​ | 29
Average cost per share | ​ | $ | 5.32 | ​ | $ | 7.29
Total cost of treasury shares acquired | ​ | $ | 191 | ​ | $ | 213
​ Expected Tax Treatment of Dividends For the fiscal year ended June 30, 2024, all common stock dividends for that fiscal year were treated for tax purposes as qualified dividend income to the recipients. Based on its current projections for the fiscal year ended June 30, 2025, the Company expects all common stock dividends for such period to be treated as qualified dividend income to the recipients. Such projections are based on the Company’s reasonable expectations as of December 31, 2024 and are subject to change based on the Company’s final tax calculations at the end of the fiscal year. Stock-Based Incentive Plan The Evolution Petroleum Corporation 2016 Equity Incentive Plan (the “2016 Plan”) authorized the issuance of 3.6 million shares of common stock prior to its expiration on December 8, 2026. On December 5, 2024 shareholders approved and adopted the amendment and restatement of the 2016 Plan (hereinafter the “Amended and Restated Plan”), which increased the shares authorized for issuance under the 2016 Plan by 2.1 million shares to a maximum of 5.7 million shares. The duration of the Amended and Restated Plan is indefinite, provided that no new awards shall be made under the Amended and Restated Plan on or after the tenth anniversary of the date the stockholders approved the Amended and Restated Plan. Incentives under the Amended and Restated 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, non-qualified stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, and performance share awards. As of December 31, 2024 and June 30, 2024, approximately 2.5 million shares and 0.9 million shares, respectively, remained available for grant under the Amended and Restated Plan. The Company estimates the fair value of stock-based compensation awards on the grant date to provide the basis for future compensation expense. During the three and six months ended December 31, 2024, the Company recognized $0.7 million and $1.2 million, respectively, related to stock-based compensation. During the three and six months ended December 31, 2023, the Company recognized $0.6 million and $1.0 million, respectively, related to stock-based compensation. Stock-based compensation expense is recorded as a component of “General and administrative expenses” on the unaudited condensed consolidated statements of operations. Time-Vested Restricted Stock Awards Time-vested restricted stock awards contain service-based vesting conditions and expire after a maximum of four years from the date of grant if unvested. The common shares underlying these awards are issued on the date of grant and participate in dividends paid by the Company. These service-based awards vest with continuous employment by the Company, generally in annual installments over terms of three to four years. Awards to the Company’s directors generally have one-year cliff vesting. For such awards, grant date fair value is based on market value of the Company’s common stock at the time of grant. This value is then amortized ratably over the service period. Previously recognized amortization expense subsequent to the last vesting date of an award is reversed in the event that the holder has no longer rendered service to the Company resulting in forfeiture of the award. Performance-Based Restricted Stock Awards and Performance-Based Contingent Stock Units Performance-based restricted stock awards and performance-based contingent stock units contain market-based vesting conditions based on the price of the Company’s common stock, the intrinsic value indexed solely to its common stock or the intrinsic value indexed to its common stock compared to the performance of the common stock of its peers. The common shares underlying the Company’s performance-based restricted stock awards are issued on the date of grant and participate in dividends paid by the Company and expire after a maximum of four years from the date of grant if unvested. Performance-based contingent share units do not participate in dividends and shares are only issued in part or in full upon the attainment of vesting conditions, generally have a lower probability of achievement and expire after a maximum of four years from the date of grant if unvested. Shares underlying performance-based contingent share units are reserved from the 2016 Plan. Performance-based restricted stock awards and contingent restricted stock units are valued using a Monte Carlo simulation and geometric Brownian motion techniques applied to the historical volatility of the Company’s total stock return compared to the historical volatilities of other companies or indices to which the Company compares its performance and/or the Company’s absolute total stock return. For certain awards, this Monte Carlo simulation also provides an expected vesting term. Stock-based compensation is recognized ratably over the expected vesting period, so long as the award holder remains an employee 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 by the holder resulting in forfeiture of the award or as a result of regulatory required clawback. Vesting of grants with performance-based vesting conditions is dependent on the future price of the Company’s common stock. Such awards vest in part or in full 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. During the six months ended December 31, 2024, the Company granted a total of 0.5 million equity awards that included 0.2 million time-vested restricted stock awards, 0.2 million performance-based restricted stock awards, and 0.1 million performance-based contingent stock units. During the six months ended December 31, 2023, the Company granted a total of 0.4 million equity awards that included 0.2 million time-vested restricted stock awards, 0.1 million performance-based restricted stock awards, and 0.1 million of performance-based contingent stock units. For performance-based awards granted during the six months ended December 31, 2024 and 2023, the assumptions used in the Monte Carlo simulation valuations were as follows:
​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Six Months Ended
​ | ​ | December 31,
​ |  | 2024 |  | 2023
Weighted average fair value of performance-based awards granted | ​ | $ | 3.90 | ​ | $ | 3.58
Risk-free interest rate | ​ | ​ | 3.45% | ​ | ​ | 4.87%
Expected term in years | ​ | ​ | 2.78 | ​ | ​ | 2.77
Expected volatility | ​ | ​ | 50.2% | ​ | ​ | 55.0%
Dividend yield | ​ | ​ | 8.4% | ​ | ​ | 7.4%
​ Unvested restricted stock awards as of December 31, 2024 consisted of the following:
​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | Weighted
​ | ​ | Number of | ​ | Average
​ | ​ | Restricted | ​ | Grant-Date
Award Type |  | Shares |  | Fair Value
Time-vested awards | ​ | 396,477 | ​ | $ | 6.35
Performance-based awards | ​ | 417,923 | ​ | ​ | 5.40
Unvested at December 31, 2024 | ​ | 814,400 | ​ | $ | 5.86
​ ​ The following table sets forth the restricted stock award transactions for the six months ended December 31, 2024: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | Weighted
​ | ​ | ​ | ​ | Weighted | ​ | Unamortized | ​ | Average
​ | ​ | Number of | ​ | Average | ​ | Compensation | ​ | Remaining
​ | ​ | Restricted | ​ | Grant-Date | ​ | Expense | ​ | Amortization
​ |  | Shares |  | Fair Value |  | (In thousands) |  | Period (Years)
Unvested at June 30, 2024 | ​ | 628,511 | ​ | ​ | 6.31 | ​ | $ | 2,492 | ​ | 1.8
Time-vested shares granted | ​ | 187,155 | ​ | ​ | 5.70 | ​ | ​ | ​ | ​ | ​
Performance-based shares granted | ​ | 189,477 | ​ | ​ | 4.82 | ​ | ​ | ​ | ​ | ​
Vested | ​ | (182,316) | ​ | ​ | 6.14 | ​ | ​ | ​ | ​ | ​
Forfeited | ​ | (8,427) | ​ | ​ | 6.05 | ​ | ​ | ​ | ​ | ​
Unvested at December 31, 2024 | ​ | 814,400 | ​ | $ | 5.86 | ​ | $ | 3,317 | ​ | 1.9
​ The following table sets forth contingent restricted stock unit transactions for the six months ended December 31, 2024:
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | Weighted
​ | ​ | ​ | ​ | ​ | ​ | ​ | Unamortized | ​ | Average
​ | ​ | Number of | ​ | Weighted Average | ​ | Compensation | ​ | Remaining
​ | ​ | Restricted | ​ | Grant-Date | ​ | Expense | ​ | Amortization
|  | Stock Units |  | Fair Value |  | (In thousands) |  | Period (Years)
Unvested at June 30, 2024 | ​ | 150,788 | ​ | $ | 2.86 | ​ | $ | 230 | ​ | 1.6
Performance-based awards granted | ​ | 142,112 | ​ | ​ | 2.67 | ​ | ​ | ​ | ​ | ​
Forfeited | ​ | (3,394) | ​ | ​ | 2.91 | ​ | ​ | ​ | ​ | ​
Unvested at December 31, 2024 | ​ | 289,506 | ​ | $ | 2.77 | ​ | $ | 484 | ​ | 2.1
​

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