Stock-Based Compensation

9 Months Ended

Mar. 31, 2021

Share-based Payment Arrangement [Abstract]

Stock Compensation Accounting

The weighted average estimated fair value of option awards granted was $45.63 and $37.54 during the three months ended March 31, 2021 and 2020, respectively, and $38.76 and $33.15 during the nine months ended March 31, 2021 and 2020, respectively.

We utilized the Black-Scholes option valuation model with the following weighted average assumptions:


	Nine Months Ended March 31,
	2021		2020
Risk-free interest rate	0.4	%	1.5	%
Expected dividend yield	0.0	%	0.0	%
Expected life (in years)	4.7		4.5
Expected volatility factor	34.1	%	26.8	%

The stock-based compensation expense under all equity plans and its classification in the unaudited consolidated statements of operations for the three and nine months ended March 31, 2021 and 2020 are as follows:


	Three Months Ended March 31,				Nine Months Ended March 31,
	2021		2020		2021		2020
	(Dollars in Thousands)
Recorded as expenses:
Cost of maintenance	$	234	$	343	$	688	$	1,104
Cost of services and other	412		450		1,198		1,477
Selling and marketing	1,869		1,472		4,655		4,228
Research and development	2,273		2,082		6,515		6,193
General and administrative	4,437		2,952		11,533		11,131
Total stock-based compensation	$	9,225	$	7,299	$	24,589	$	24,133

A summary of stock option and restricted stock unit ("RSU") activity under all equity plans for the nine months ended March 31, 2021 is as follows:


	Stock Options						Restricted Stock Units
	Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value (in 000’s)		Shares	Weighted Average Grant Date Fair Value
Outstanding at June 30, 2020	1,410,139	$	76.19	6.67	$	49,705	352,921	$	112.45
Granted	322,472	131.40					245,023	130.63
Settled (RSUs)	—						(148,386)	105.13
Exercised (Stock options)	(187,113)	62.05					—
Cancelled / Forfeited	(36,779)	115.82					(33,060)	115.97
Outstanding at March 31, 2021	1,508,719	$	88.77	6.67	$	83,915	416,498	$	125.49
Vested and exercisable at March 31, 2021	969,700	$	67.80	5.43	$	74,212
Vested and expected to vest as of March 31, 2021	1,451,661	$	87.34	6.58	$	82,837	365,640	$	125.51

As of March 31, 2021, common stock reserved for future issuance under equity compensation plans was 5.5 million shares.

Employee Stock Purchase Plan

On July 26, 2018, our Board of Directors approved the Aspen Technology, Inc. 2018 Employee Stock Purchase Plan (the "ESPP"), which provides for the issuance of up to 250,000 shares of common stock to participating employees. The ESPP is intended to be a qualified employee stock purchase plan under Section 423 of the Internal Revenue Code of 1986 (the "IRC"). The ESPP was approved at our Annual Meeting of Stockholders on December 7, 2018. The ESPP currently provides for a purchase price equal to 85% of the lower of (a) the fair market value of the common stock on the first trading day of each ESPP offering period and (b) the fair market value of the common stock on the last day of the offering period. Our initial offering period was January 1, 2019 through June 30, 2019, and our current offering period is January 1, 2021 through June 30, 2021.

We recorded stock-based compensation expense associated with the ESPP of $0.2 million and $0.2 million during the three months ended March 31, 2021 and 2020, respectively, and $0.5 million and $0.4 million during the nine months ended March 31, 2021 and 2020, respectively. As of March 31, 2021, there were 208,687 shares of common stock available for issuance under the ESPP.