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LONG-TERM INCENTIVE PLAN AWARDS | 9 Months Ended
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Mar. 31, 2022
Share-Based Payment Arrangement [Abstract] |
LONG-TERM INCENTIVE PLAN AWARDS | NOTE 9 - LONG-TERM INCENTIVE PLAN AWARDS We apply the provisions of ASC 718, “Compensation - Stock Compensation,” to all of our stock-based compensation awards and use the Black-Scholes option pricing model to value stock options. Under this application, we record compensation expense for all awards granted. In 2009, we adopted the Stock Incentive Plan (“2009 Plan”), which provided for the grant of incentive stock options and non-qualified stock options to our employees and directors. Options granted under the 2009 Plan generally have a term of ten years and generally vest and become exercisable at the rate of 33% after one year and 33% on the second and third anniversaries of the option grant dates. Historically, some stock option grants have included shorter vesting periods ranging from one to two years. In July of 2020, the Board of Directors adopted the 2020 Franklin Wireless Corp. Stock Option Plan (the “2020 Plan”), which covers 800,000 shares of Common Stock. The 2020 Plan provide for the grant of incentive stock options, non-qualified stock options and restricted stock to our employees, directors, and independent contractors. These options will have such vesting or other provisions as may be established by the Board of Directors at the time of each grant. The estimated forfeiture rate considers historical turnover rates stratified into employee pools in comparison with an overall employee turnover rate, as well as expectations about the future. We periodically revise the estimated forfeiture rate in subsequent periods if actual forfeitures differ from those estimates. There were $373,612 and $282,116 in compensation expenses recorded under this method for the nine months ended March 31, 2022 and 2021, respectively. A summary of the status of our stock options is presented below as of March 31, 2022:
Schedule of stock option activity |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  | Weighted- |  |  |  |
|  |  |  |  |  |  |  | Average |  |  |  |
|  |  |  |  | Weighted- |  |  | Remaining |  |  |  |
|  |  |  |  | Average |  |  | Contractual |  |  | Aggregate |
|  |  |  |  | Exercise |  |  | Life |  |  | Intrinsic |
Options |  | Shares |  |  | Price |  |  | (In Years) |  |  | Value |
Outstanding as of June 30, 2021 |  |  | 484,000 |  |  | $ | 3.67 |  |  |  | 2.83 |  |  | $ | 2,662,830 |
Granted |  |  | 388,000 |  |  |  | 3.38 |  |  |  | – |  |  |  | – |
Exercised |  |  | (3,999 | ) |  |  | 5.40 |  |  |  | – |  |  |  | – |
Cancelled |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |
Forfeited or expired |  |  | (7,000 | ) |  |  | 5.40 |  |  |  | – |  |  |  | – |
Outstanding as of March 31, 2022 |  |  | 861,001 |  |  | $ | 3.52 |  |  |  | 3.26 |  |  | $ | 804,040 |
Exercisable as of March 31, 2022 |  |  | 382,588 |  |  | $ | 3.04 |  |  |  | 1.88 |  |  | $ | 589,219 |
The aggregate intrinsic value in the preceding table represents the total pretax intrinsic value, based upon the Company’s closing stock price of $3.985 as of March 31, 2022, which would have been received by the option holders had all option holders exercised their options as of that date. The weighted-average grant-date fair value of stock options outstanding as of March 31, 2022, in the amount of 861,001 shares was $2.92 per share. As of March 31, 2022, there was unrecognized compensation cost of $1,503,518 related to non-vested stock options granted. A summary of the status of our stock options is presented below as of March 31, 2021:
|  |  |  |  |  |  |  | Weighted- |  |  |  |
|  |  |  |  |  |  |  | Average |  |  |  |
|  |  |  |  | Weighted- |  |  | Remaining |  |  |  |
|  |  |  |  | Average |  |  | Contractual |  |  | Aggregate |
|  |  |  |  | Exercise |  |  | Life |  |  | Intrinsic |
Options |  | Shares |  |  | Price |  |  | (In Years) |  |  | Value |
Outstanding as of June 30, 2020 |  |  | 251,291 |  |  | $ | 1.05 |  |  |  | 1.95 |  |  | $ | 1,124,525 |
Granted |  |  | 299,000 |  |  |  | 5.40 |  |  |  | – |  |  |  | – |
Exercised |  |  | (61,291 | ) |  |  | (1.22 | ) |  |  | – |  |  |  | – |
Cancelled |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |
Forfeited or expired |  |  | (4,000 | ) |  |  | (5.40 | ) |  |  | – |  |  |  | – |
Outstanding as of March 31, 2021 |  |  | 485,000 |  |  | $ | 3.67 |  |  |  | 3.08 |  |  | $ | 8,088,910 |
Exercisable as of March 31, 2021 |  |  | 190,000 |  |  | $ | 0.99 |  |  |  | 1.20 |  |  | $ | 3,678,650 |
The aggregate intrinsic value in the preceding table represents the total pretax intrinsic value, based upon our closing stock price of 20.35 as of March 31, 2021, which would have been received by the option holders had all option holders exercised their options as of that date. The weighted-average grant-date fair value of stock options outstanding as of March 31, 2021, in the amount of 485,000 shares, was $3.02 per share. As of March 31, 2021, there was unrecognized compensation cost of $909,276 related to non-vested stock options granted.

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