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Equity Transactions
 3 Months Ended
Sep. 30, 2021
Equity [Abstract]  
Equity Transactions

7.Equity Transactions

 

Stock Options

 

The following table summarizes the activity relating to the Company’s stock options for the three months ended September 30, 2021:

 

   Options   Weighted-
Average
Exercise Price		   Weighted
Remaining
Average
Contractual
Term		   Aggregate
Intrinsic Value		 
Outstanding at June 30, 2021   755,200   $4.34    4.4   $2,569,232 
Granted   1,365,835    7.74    5.0    — 
Options Forfeited   (73,125)   (13.91)   —    — 
Outstanding at September 30, 2021   2,047,910   $9.79    4.6   $42,824 
Exercisable at  September 30, 2021   509,667   $9.36    4.4   $42,824 

 

The fair value of each option grant on the date of grant is estimated using the Black-Scholes option. The pricing model reflects the following weighted-average assumptions for the three months ended September 30, 2021:

 

   September 30,
2021		   June 30, 2021 
Expected life of options (In years)   5    5 
Expected volatility   74.96%   77.29%
Risk free interest rate   0.80%   0.39%
Dividend Yield   0%   0%

 

Expected volatility is based on the historical volatilities of the daily closing price of the common stock of three comparable companies and the expected life of options is based on historical data with respect to employee exercise periods. The Company accounts for forfeitures as they are incurred.

 

The Company recorded stock option-based compensation expense of $1,926,962 and $0 for three-month periods ended September 30, 2021 and 2020, respectively.

 

As of September 30, 2021, there was approximately $6.8 million of unrecognized compensation cost related to non-vested stock options granted to Directors and Officers, which is expected to be recognized over a weighted-average period of approximately 4.7 years.

The following is a summary of stock options outstanding and exercisable by exercise price as of September 30, 2021:

 

  Exercise Price   Outstanding   Weighted Average
Contract Life		   Exercisable 
  $2.80    7,200    3.3    7,200 
  $3.75    4,800    2.3    4,800 
  $6.25    1,600    2.1    1,600 
  $7.50    25,600    4.4    25,600 
  $7.74    1,365,835    4.9    273,167 
  $8.75    1,600    2.5    1,600 
  $9.54    800    4.0    800 
  $9.90    800    4.0    800 
  $12.50    4,000    1.3    4,000 
  $13.91    618,475    4.2    172,900 
  $25.00    1,600    1.0    1,600 
  $26.25    4,400    0.6    4,400 
  $27.50    800    0.5    800 
  $28.75    1,600    0.8    1,600 
  $31.25    4,000    0.1    4,000 
  $42.09    4,800    4.3    4,800 
        2,047,910         509,667 

 

Stock Warrants

 

The following table summarizes warrant activity during the three months ended September 30, 2021:

 

   Number of
Shares		   Weighted
Average
Exercise Price		   Weighted
Average
Remaining
Life (Years)		   Aggregate
Intrinsic Value		 
Outstanding and exercisable at June 30, 2021   158,761   $10.37    3.1   $1,765,437 
Granted   —   —    —    — 
Exercised   —   —    —    — 
Outstanding and exercisable at September 30, 2021   158,761   $10.37    2.8   $486,666 

 

Of the above warrants, 9,391 expire in the fiscal year ending June 30, 2022, 4,815 expire in the fiscal year ending June 30, 2023, 2,714 expire in the fiscal year ending June 30, 2025, and 141,841 expire in the fiscal year ending June 30, 2026.

 

Issuance of common stock for cash

 

On August 11, 2021, the Company closed a registered public offering issuing 2,500,000 of its Class A common stock at $8.00 per share, resulting in net proceeds to the Company of approximately $17.8 million, net of issuance costs of approximately $2.2 million

 

On September 24, 2021, the Company issued 92,000 of its Class A common stock at $8.00 per share in connection with the underwriters’ exercise of its over-allotment option in for the August 2021 registered public offering, resulting in net proceeds to the Company of approximately $707,000, net of issuance cost of approximately $29,000.

Issuance of Shares for Services

 

On August 20, 2021, the Company awarded 58,759 restricted stock units (“RSUs”) to the President and CEO under the Company’s 2019 Omnibus Incentive Equity Plan (the “2019 Omnibus Plan”) as his salary for the period from April 27, 2021, the date of his appointment, through December 31, 2021. The number of RSUs awarded was based on a prorated annual base salary of $600,000 at a 10% discount to the grant date fair value of $7.74 per share of the Company’s common stock. Each RSU awarded the to the CEO entitles him to receive one share of common stock upon vesting. A total of 15,339 RSUs (representing the pro rata portion of the RSU award for the period from April 27, 2021 to June 30, 2021) vested at the grant date, 21,710 RSUs vested at September 30, 2021, and 21,710 will vest at December 31, 2021. Accordingly, during the three months ended September 30, 2021, 37,049 RSUs vested and 37,049 shares of common were issued to the CEO.

 

The Company recorded stock-based compensation expense related to these RSUs of $286,759 and $0 for three- month periods ended September 30, 2021 and 2020, respectively.

 

Issuance of Stock Options

 

On August 20, 2021, the Company granted, under the 2019 Omnibus Plan, stock options to purchase 1,365,835 shares of common stock to the executive management team. Twenty percent (20%) of the shares underlying the options awarded vested on the grant date, and the remaining 80% vest equally over a 5-year period, on the first, second, third, fourth and fifth anniversary of the grant date. The option price per share is $7.74 per share, the grant date fair value, and the options terminate on the tenth anniversary of the grant date.

 

Forfeiture of Stock Options

 

On August 27, 2021, the Chief Executive Officer forfeited unvested stock options to purchase up to 73,125 shares of common stock that were previously granted to him as compensation as an independent director of the board.