On November 26, 2019, the Company’s board of directors approved the 2019 Equity Incentive Plan (2019 Plan), which became effective on December 10, 2019, the date immediately before the Company’s Registration Statement on Form S-1 was declared effective by the SEC.

The Company’s 2016 Equity Incentive Plan (2016 Plan), which was adopted in February 2016, was terminated concurrent to the effective date of the 2019 Plan. The Company’s 2006 Equity Incentive Plan (2006 Plan), which was adopted in April 2006, was terminated upon the adoption of the 2016 Plan. There were no equity-based awards granted under the 2016 Plan and the 2006 Plan after their termination; however, all outstanding awards under the 2016 Plan and the 2006 Plan continue to remain subject to the terms of the respective Equity Incentive Plan until such awards are exercised or until they terminate or expire by their terms. The 2019 Plan, 2016 Plan and 2006 Plan are collectively referred to as the “Equity Incentive Plans.”

The 2019 Plan authorizes the award of stock options, restricted stock units (RSUs), restricted stock awards, stock appreciation rights, performance awards, cash awards, and stock bonus awards. The Company initially reserved 7,100,000 shares of its common stock, plus any reserved shares not issued or subject to outstanding grants under the 2016 Plan, for issuance pursuant to awards granted under the Company’s 2019 Plan. The number of shares reserved for issuance under the 2019 Plan increases automatically on July 1 of each of 2020 through 2029 by the number of shares equal to the lesser of 5% of the total number of outstanding shares of the Company’s common stock as of the immediately preceding June 30, or a number as may be determined by the Company’s board of directors. In addition, the following shares of common stock from the 2016 Plan and the 2006 Plan will be available for grant and issuance under the 2019 Plan:

The total number of common shares available for issuance under the Equity Incentive Plans was 10,211,011 shares as of June 30, 2021.

In connection with the acquisition of Divvy, the Company assumed and replaced the stock options that were granted to Divvy employees after May 1, 2019 and were outstanding on the acquisition date under the Divvy 2016 Plan. The assumed equity awards will be settled in shares of the Company’s common stock and will retain the terms and conditions under which they were originally granted. No additional equity awards will be granted under the Divvy 2016 Plan and the forfeited awards will not be returned to the Divvy 2016 Plan.

The Company may grant incentive and non-statutory stock options to employees, nonemployee directors, and consultants of the Company under the Equity Incentive Plans. Stock options granted generally vest and become exercisable ratably over a requisite service period of four years following the date of the grant and expire ten years from the date of the grant. The Company may grant stock options with early exercise provisions, but subject to repurchase conditions. There were no outstanding unvested stock options that had been early exercised as of June 30, 2021.

The Company may also grant stock options with double-trigger vesting conditions. The unvested shares of options granted with double trigger vesting conditions will vest 50% in the event of a sale of the Company and the termination of the holder of the stock options.

The exercise price of incentive stock options granted must be at least equal to 100% of the fair value of the Company’s common stock at the date of grant. The exercise price of non-statutory options granted must be at least equal to 85% of the fair value of the Company’s common stock at the date of grant.

A summary of stock option activity as of June 30, 2021, and changes during the year ended June 30, 2021, is presented below:

	Number of shares (in thousands)			Weighted average exercise price per share		Weighted average remaining contractual term (in years)	Aggregate intrinsic value (in thousands)
Outstanding at June 30, 2020		9,019		$	10.53	8.26	$	718,563
Granted⁽¹⁾		1,289		$	18.24
Exercised		(3,359	)	$	8.03
Forfeited		(397	)	$	10.90
Outstanding at June 30, 2021		6,552		$	13.31	7.87	$	1,113,025
Vested and expected to vest at June 30, 2021 ⁽²⁾		6,070		$	13.20	7.85	$	1,031,708
Vested and exercisable at June 30, 2021		2,608		$	11.23	7.53	$	448,497

The weighted-average grant date fair value of options granted during the years ended June 30, 2021, 2020 and 2019 was $132.04, $11.04 and $4.24 per share, respectively. The total intrinsic value of options exercised during the years ended June 30, 2021, 2020 and 2019 was $387.1 million, $191.3 million and $3.8 million, respectively. The intrinsic value was calculated as the difference between the estimated fair value of the Company’s common stock at exercise and the exercise price of the in-the-money options.

The fair value of options granted during the years ended June 30, 2021, 2020 and 2019 was estimated at the date of grant using the Black-Scholes option-pricing model with the following assumptions:

	Year ended June 30,
	2021	2020	2019
Expected term (in years)	4.00 to 6.25	6.25	6.25
Expected volatility	35.0% to 85.1%	50.0% to 100.6%	46.0% to 51.0%
Risk-free interest rate	0.38% to 1.03%	0.35% to 1.88%	2.19% to 2.89%
Expected dividend yield	0%	0%	0%

Prior to the IPO, the fair value of the shares of common stock underlying stock options had historically been determined by the Company’s Board of Directors. Because there had been no public market for the Company’s common stock, the Board of Directors determined fair value of the common stock at the time of grant of the option by considering a number of objective and subjective factors including important developments in the Company’s operations, valuations performed by an independent third party, sales of preferred stock, actual operating results and financial performance, the conditions in the industry and the economy in general, the stock price performance and volatility of comparable public companies, and the lack of liquidity of the Company’s common stock, among other factors.

As of June 30, 2021, the total unamortized stock-based compensation cost related to the unvested stock options was $96.4 million, which the Company expects to amortize over a weighted-average period of 2.5 years. The Company received $28.2 million, $12.2 million and $1.7 million from options exercised during the years ended June 30, 2021, 2020 and 2019, respectively.

In February 2020, the Company began issuing RSUs to certain employees and nonemployee board members under the 2019 Plan. A summary of RSU activity during the year ended June 30, 2020 is presented below:

	Number of shares (in thousands)			Weighted average grant date fair value
Nonvested at June 30, 2020		1,141		$	66.16
Granted		425		$	134.29
Vested		(297	)	$	66.34
Forfeited		(93	)	$	72.89
Nonvested at June 30, 2021		1,176		$	90.20

The fair value of the RSU grant is determined based upon the market closing price of the Company’s common stock on the date of grant. The RSUs vest over the requisite service period, which ranges between 1 year and 4 years from the date of grant, subject to the continued employment of the employees and services of the nonemployee board members. The total fair value of RSUs vested during the years ended June 30, 2021 and 2020 was $40.0 million and $0.2 million, respectively.

As of June 30, 2021, the total unamortized stock-based compensation expense related to the unvested RSUs was $86.6 million, which the Company expects to amortize over a weighted-average period of 3.2 years.

On November 26, 2019, the Company’s board of directors approved the 2019 Employee Stock Purchase Plan (ESPP), which became effective on December 11, 2019, the date the Company’s Registration Statement on Form S-1 was declared effective by the SEC. The ESPP is intended to qualify under Section 423 of the Internal Revenue Code of 1986 (as amended) and will provide eligible employees a means to acquire shares of common stock through payroll deductions. Under the ESPP, the Company initially reserved for issuance 1,400,000 shares of common stock, which will increase automatically on July 1 of each fiscal year during the term of the ESPP by the number of shares equal to 1% of the total number of shares of common stock and preferred stock (on as-converted basis) outstanding as of the immediately preceding June 30th, unless the board of directors elects to authorize a lesser number of shares; provided, that, the total number of shares issued under the ESPP may not exceed 14,000,000 shares of common stock.

The ESPP provides for consecutive offering periods during which eligible employees can participate in the ESPP and be granted the right to purchase shares.

The offering period that commenced on August 15, 2020 shall end on September 6, 2021, with the first purchase period ending on February 14, 2021 and the second purchase period ending on September 6, 2021. Subsequent offering periods shall be for a 12-month period commencing on February 7th and September 7th, with each such offering period consisting of two separate purchase periods ending on September 6th and February 6th, and February 6th and September 6th, respectively.

Eligible employees can contribute up to 15% of their eligible compensation, subject to limitation as provided for in the ESPP, and purchase the common stock at a purchase price per share equal to 85% of the lesser of the fair market value of the common stock on (i) the offering date or (ii) the purchase date.

The fair value of ESPP offerings was estimated at the date of each offering using the Black-Scholes option-pricing model with the following assumptions during the years ended June 30, 2021 and 2020:

	Year ended June 30,
	2021			2020
Expected term (in years)	0.50 to 1.00			0.5 to 1.17
Expected volatility	81.0% to 88.4%				50.0	%
Risk-free interest rate	0.05% to 0.13%			1.47% to 1.56%
Expected dividend yield		0	%		0	%

As of June 30, 2021, the total unrecognized compensation expense related to the ESPP was $2.1 million, which is expected to be amortized over the next 12 months.

Stock-based compensation cost from stock options, RSUs and ESPP was included in the following line items in the accompanying consolidated statements of operations and consolidated balance sheets (in thousands):

	Year ended June 30,
	2021		2020		2019
Cost of revenue	$	2,938	$	1,257	$	331
Research and development		16,091		5,495		1,128
Sales and marketing		8,547		2,777		922
General and administrative		44,411		8,535		1,701
Property and equipment (capitalized internal-use software)		464		—		—
Total	$	72,451	$	18,064	$	4,082

The Company has an agreement with a customer to issue warrants for up to 5.6 million shares of the Company’s common stock at an exercise price of $4.50 per share over a period of five years, ending in September 2023. Issuance of the warrants is contingent upon certain performance conditions and subject to certain limits. As of June 30, 2021, there were no warrants issued or issuable under this agreement. The Company has concluded that the performance conditions for the issuance of this warrant are not probable of being met.