Stock-Based Compensation

12 Months Ended

Jun. 30, 2013

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Stock-Based Compensation

NOTE 17—STOCK-BASED COMPENSATION

The 2010 Equity Incentive Plan (the “2010 Plan”) replaced the 2008 Equity Incentive Plan and all remaining available shares from the 2008 Equity Incentive Plan will be available for distribution under the 2010 Plan. Generally, the Company can issue incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock and other stock-based compensation under the 2010 PlanGenerally, for incentive stock options, a percentage of the options awarded become exercisable on the date of grant and on each anniversary date of grant, and for nonqualified stock options a percentage of the options awarded become exercisable on each anniversary of the date of grant. The option period expires ten years from the date of grant, except for awards to individuals who own more than 10% of the Company’s outstanding stock. Awards to these individuals expire after five years from the date of grant and are exercisable at 110% of the market price at the date of grant.

Previously, nonqualified stock options have been granted to directors, which vest immediately. The option period expires ten years from the date of grant, and the exercise price is the market price at the date of grant.

For the years ended June 30, 2013, 2012, and 2011, compensation expense of $205,597, $138,785, and $117,203, respectively, was recognized in the income statement related to the vesting of option awards.

As of June 30, 2013, there was $363,000 of compensation expense related to unvested awards not yet recognized in the financial statements. The weighted-average period over which this expense is to be recognized is 1.4 years.

The aggregate intrinsic value of all options that were exercisable at June 30, 2013 was $486,000. The aggregate intrinsic value of all options outstanding at June 30, 2013 was $1,315,000. The Company has not issued any stock option awards to directors of the Company since the institution of the regulatory orders detailed in Note 15 – Regulatory Matters.

Options outstanding at June 30, 2013 were as follows:

	Outstanding				Exercisable
Range of Exercise Price	Number		Weighted Average Remaining Life		Number		Weighted Average Exercise Price
$1.39 to $4.42		693,300		8.2		268,765	$	2.20
$8.32 to $12.40		141,221		2.1		159,259	$	8.45
Total		834,521		7.1		428,024	$	4.53

A summary of stock-based compensation activity is as follows:

	2013 Total options outstanding
	Shares			Weighted- Average Exercise Price
Options outstanding, beginning of year		740,256		$	4.15
Forfeited		(42,800	)	$	2.01
Expired		(40,435	)	$	8.63
Exercised		(106,500	)	$	1.84
Granted		284,000		$	2.26
Options outstanding, end of year		834,521		$	3.67
Options exercisable, end of year		428,024		$	4.53

The weighted-average remaining contractual life of options outstanding as of June 30, 2013 was 7.1 years. The weighted-average remaining contractual life of vested options outstanding as of June 30, 2013 was 5.0 years.

No options were exercised in the twelve-month period ended June 30, 2012.

The fair value for stock options granted to executive officers and certain other employees was determined at the date of grant using a Black-Scholes options-pricing model and the following assumptions:

	2013			2012			2011
Expected weighted average risk-free interest rate		0.83	%		2.43	%		3.32	%
Expected weighted average life (in years)		6.00			6.00			6.00
Expected volatility		56.75	%		34.00	%		34.00	%
Expected dividend yield		0.00	%		0.00	%		0.00	%

The weighted-average fair value of the fiscal 2013 grants was $1.17 per option. The expected average risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant for periods corresponding with the life of the option. The expected average life represents the weighted-average period of time that options granted are expected to be outstanding giving consideration to vesting schedules, historical exercise and forfeiture patterns. Expected volatility is based on historical volatilities of the Company’s common stock. The expected dividend yield is based on historical information.

There were 420,790 shares of restricted stock issued to directors, executive officers and certain other employees with a weighted average fair value of $1.84 per share at June 30, 2013. The total fair value of restricted shares issued at June 30, 2013 was $773,148. For the years ended June 30, 2013, 2012 and 2011 compensation expense related to the vesting of restricted stock awards of $261,844, $215,813 and $166,124, respectively was recognized. As of June 30, 2013, there was $115,930 of compensation expense related to unvested awards not yet recognized in the financial statements. The weighted-average period of time over which this expense is to be recognized was 1.1 years at June 30, 2013.

A summary of changes in the Company’s restricted stock for the twelve months ended June 30, 2013 is as follows:

Nonvested Shares	Shares			Weighted- Average Grant-Date Fair Value
Nonvested at July 1, 2012		162,333		$	303,537
Granted		77,937			157,433
Vested		(132,604	)		(259,606	)
Forfeited		(5,000	)		(8,950	)
Nonvested at June 30, 2013		102,666		$	192,414

There were 1,963,210 shares available for future issuance under the existing stock plan at June 30, 2013.