Basis of Presentation and Significant Accounting Policies (Tables)

3 Months Ended

Dec. 31, 2013

Inventory

Inventory consists of the following (in thousands):

	December 31, 2013		September 30, 2013
Raw materials and supplies	$	458	$	516
Finished goods		1,095		931
	$	1,554	$	1,447

Results of Operations from Equity Method Investments

The results of operations for Mediasite KK, translated into US dollars based on the average conversion rate during the period, for their three month periods ended September 30, 2013 and 2012 are listed in the table below (in thousands).

	Three Months ended September 30, 2013		Three Months ended September 30, 2012
Revenue	$	1,794	$	2,182
Gross margin		1,094		1,625
Income from operations		261		504
Net income		159		307

Fair Value Assumptions for Stock Options Granted

The fair value of each option grant is estimated using the assumptions in the following table:

	Three months ended December 31,
	2013			2012
Expected life		4.8 years			4.8 years
Risk-free interest rate		0.60	%		0.37	%
Expected volatility		47.15	%		49.34	%
Expected forfeiture rate		12.19	%		12.32	%
Expected exercise factor		1.39			1.36
Expected dividend yield		0	%		0	%

Summary of Option Activity

A summary of option activity as of December 31, 2013 and changes during the three months then ended is presented below:

	Options			Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Period in Years
Outstanding at October 1, 2013		997,045		$	10.54		6.7
Granted		249,900			9.91		9.8
Exercised		(4,824	)		7.24		6.2
Forfeited		(6,133	)		13.41		6.4
Outstanding at December 31, 2013		1,235,988			10.41		7.1
Exercisable at December 31, 2013		708,101			11.51		5.5

Summary of Status of Company's Non-vested Shares

A summary of the status of the Company’s non-vested shares and changes during the three month period ended December 31, 2013 is presented below:

	2013
Non-vested Shares	Shares			Weighted-Average Grant Date Fair Value
Non-vested at October 1, 2013		430,605		$	3.28
Granted		249,900			3.38
Vested		(149,983	)		3.52
Forfeited		(2,635	)		3.72
Non-vested at December 31, 2013		527,887		$	3.26

Computation of Basic and Diluted Weighted Average Shares Used in Earnings Per Share Calculations

The following table sets forth the computation of basic and diluted weighted average shares used in the earnings per share calculations:

	Three Months Ended December 31,
	2013		2012
Denominator for basic earnings per share - weighted average common shares		3,995,321		3,897,880
Effect of dilutive options (treasury method)		—		—
Denominator for diluted earnings per share - adjusted weighted average common shares		3,995,321		3,897,880
Options outstanding during each period, but not included in the computation of diluted earnings per share because they are antidilutive		1,235,988		1,051,911