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SHARE-BASED COMPENSATION | 9 Months Ended
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Mar. 31, 2023
Share-Based Payment Arrangement [Abstract] |
SHARE-BASED COMPENSATION | NOTE 8. SHARE-BASED COMPENSATION Through June 2014, we had two equity compensation plans, the Second Amended and Restated 2004 Stock Option Plan (the “Employee Stock Option Plan”) and the Amended and Restated 2004 Directors’ Stock Option Plan (the “Directors’ Stock Option Plan”) (collectively, the “Former Stock Option Plans”). The Employee Stock Option Plan and Director’s Stock Option Plan were terminated in June 2014 and December 2014, respectively. In September 2016, our Board approved the establishment of the 2016 Equity Incentive Plan, which was approved by our shareholders at our 2016 Annual Meeting. The 2016 Equity Incentive Plan provides for the award of up to 1,500,000 shares of our common stock in the form of incentive stock options, nonstatutory stock options, stock appreciation rights, restricted shares, restricted stock units, performance awards, and other stock-based awards. As of March 31, 2023, 200,000 performance awards and 372,000 non-qualified stock options have been granted under the 2016 Equity Incentive Plan. Former Stock Option Plans No options were granted under the Former Stock Option Plans during the three or nine months ended March 31, 2023 and 2022. As of March 31, 2023, there was no unrecognized compensation cost under the Former Stock Option Plans, as all remaining outstanding stock options have been exercised during fiscal 2023. The following is a summary of stock option activity for the nine months ended March 31, 2023 and 2022:
Schedule of stock option activity |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Nine Months Ended March 31, |
|  | 2023 |  |  | 2022 |
|  | Number of Shares |  |  | Weighted-Average Exercise Price |  |  | Number of Shares |  |  | Weighted-Average Exercise Price |
Outstanding at July 1, |  |  | 6,500 |  |  | $ | 1.82 |  |  |  | 31,500 |  |  | $ | 1.81 |
Options granted |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Options exercised |  |  | (6,500 | ) |  |  | 1.82 |  |  |  | (25,000 | ) |  |  | 1.80 |
Options forfeited |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Outstanding at end of period |  |  | — |  |  | $ | — |  |  |  | 6,500 |  |  | $ | 1.82 |
Stock Options Exercisable at March 31, |  |  | — |  |  | $ | — |  |  |  | 6,500 |  |  | $ | 1.82 |
Performance Awards In December 2017, the Compensation Committee of our Board of Directors granted 200,000 performance awards to our employees, which will generally be paid in shares of our common stock. Whether any performance awards vest, and the amount that does vest, is tied to the completion of service periods that range from 7 months to 9.5 years at inception and the achievement of our common stock trading at certain pre-determined prices. The weighted average fair value of the performance awards granted was $4.46, calculated using the weighted average fair market value for each award, using a Monte Carlo simulation. In February 2020, the Compensation Committee reallocated 48,000 previously forfeited awards, having the same remaining terms and conditions, to certain other employees. The weighted average fair value of the performance awards reallocated in 2020 was $16.90, calculated using the weighted average fair market value for each award, using a Monte Carlo simulation. In December 2021, the Compensation Committee reallocated an additional 17,500 previously forfeited awards, having the same remaining terms and conditions, to other employees. The weighted average fair value of the performance awards reallocated in 2021 was $20.34, calculated using the weighted average fair market value for each award, using a Monte Carlo simulation. During the three months ended March 31, 2023 and 2022, we recorded share-based compensation expense of $30,000 and $81,000, respectively, related to outstanding performance awards. During the nine months ended March 31, 2023 and 2022, we recorded share-based compensation expense of $91,000 and $123,000, respectively, related to outstanding performance awards. On March 31, 2023, there was approximately $232,000 of unrecognized compensation cost related to non-vested performance awards expected to be expensed over the weighted-average period of 2.25 years. On July 1, 2022, it was determined by the Compensation Committee of our Board of Directors that the vesting of performance awards for 37,500 shares of common stock had been achieved. Each participant elected a net issuance to cover their individual withholding taxes and therefore we issued 23,641 shares and paid $223,000 of participant-related payroll tax liabilities. Non-Qualified Stock Options In December 2020, the Compensation Committee of our Board of Directors granted 310,000 non-qualified stock options to our directors and certain employees under the 2016 Equity Incentive Plan. Whether any stock options vest, and the amount that does vest, is tied to the completion of service periods that range from 18 months to 10.5 years from the date of grant and the achievement of our common stock trading at certain pre-determined prices. The weighted average fair value of the stock option awards granted was $16.72, calculated using a Monte Carlo simulation. In December 2021, the Compensation Committee reallocated 5,000 previously forfeited non-qualified stock options, having the same remaining terms and conditions, to another employee at a weighted average fair value of $6.69 calculated using a Monte Carlo simulation. During the three months ended March 31, 2023 and 2022, we recorded compensation expense of $168,000 and $271,000, respectively, related to these options. During the nine months ended March 31, 2023 and 2022, we recorded compensation expense of $479,000 and $799,000, respectively, related to these options. As of March 31, 2023, none of these non-qualified options have vested and there was approximately $2.5 million of unrecognized compensation cost related to these non-vested non-qualified stock options. In February 2021, the Compensation Committee of our Board of Directors granted 62,000 stock options to our directors and certain employees under the 2016 Equity Incentive Plan. Whether any stock options vest, and the amount that does vest, is tied to the completion of service periods that range from 4 months to 1.3 years at inception and the achievement of our common stock trading at certain pre-determined prices. Of these stock options, 4,250 were forfeited and the remaining 57,750 vested on July 1, 2021, as our common stock met the pre-determined prices set forth in the underlying agreements. We recorded compensation expense of $59,000 for the three and nine months ended March 31, 2021, related to these options. The weighted fair value of the stock option awards granted was $3.16, calculated using a Monte Carlo simulation. Employee Stock Purchase Plan In September 2014, our Board approved the establishment of an Employee Stock Purchase Plan (the “ESPP”), which was approved by our shareholders at our 2014 Annual Meeting. The ESPP conforms to the provisions of Section 423 of the Internal Revenue Code, has coterminous offering and purchase periods of six months, and bases the pricing to purchase shares of our common stock on a formula so as to result in a per share purchase price that approximates a 15% discount from the market price of a share of our common stock at the end of the purchase period. Our Board of Directors also approved the provision that shares formerly reserved for issuance under the Former Stock Option Plans in excess of shares issuable pursuant to outstanding options under those plans, aggregating 704,715 shares, be reserved for issuance pursuant to the ESPP. During the three months ended March 31, 2023 and 2022, we recorded ESPP share-based compensation expense in the amount of $8,000 and $5,000, respectively, and 2,956 and 1,446 shares were purchased, respectively, and allocated to employees based upon their contributions at prices of $14.79 and $21.11, respectively, per share. During the nine months ended March 31, 2023 and 2022, we recorded ESPP share-based compensation expense in the amount of $14,000 and $11,000, respectively. On a cumulative basis, since the inception of the ESPP, employees have purchased a total of 32,249 shares of our common stock.

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