Stock Based Compensation

9 Months Ended

Jun. 30, 2015

Stockholders Equity Note [Abstract]

Stockholders Equity Note Disclosure [Text Block]

Note 8 - Stock Based Compensation

The fair value of the stock options granted is estimated at the date of grant using the Black-Scholes option pricing model. The weighted average assumptions for the stock option grant during the nine months ended June 30, 2015 used in the Black-Scholes option pricing model were as follows:

	Nine Months Ended
	June 30, 2015
Expected term in years		3 years
Risk-free interest rate		0.77	%
Expected volatility		89.46	%
Expected dividend yield		0.00	%

The expected volatility was determined with reference to the historical volatility of the Company's stock. The Company uses historical data to estimate option exercise and employee termination within the valuation model. The expected term of options granted represents the period of time that the options granted are expected to be outstanding. The risk-free interest rate for periods within the contractual life of the option is based on the U.S. Treasury rate in effect at the time of grant. The dividend yield is expected to be 0.00% because historically the Company has not paid dividends on common stock.

During the three months ended June 30, 2015, no stock options were granted. During the nine months ended June 30, 2015, 36,232 stock options were granted at the exercise price of $1.82 per share. These options were granted as a component of Directors’ Compensation for the twelve months ending January 31, 2016 and were fully exercisable when granted, and expire three years from the grant date. The stock-based compensation expense of $25,000 will be recognized over the requisite service period.

A summary of stock option activity for the nine months ended June 30, 2015 is presented below:

			Weighted Average		Weighted Average
	Options		Exercise Price per		Remain Contractual
	Outstanding		Share		Term (in Years)
Balance at September 30, 2014		430,532	$	3.33		0.31
Granted		36,232		1.82
Exercised		-		-
Cancelled		(408,552)		3.99
Balance at June 30, 2015		58,212	$	2.28		2.22
Outstanding and exercisable at June 30, 2015		58,212	$	2.28		2.22

A summary of restricted stock activity for the nine months ended June 30, 2015 is presented below:

Restricted Stock Activity for the Nine			Weighted-Average
Months ended June 30, 2015	Shares		Grant-Date Fair Value
Nonvested at September 30, 2014		54,000	$	1.04
Granted		-		-
Vested		(27,000)	$	1.04
Cancelled		-		-
Nonvested at June 30, 2015		27,000	$	1.04

Stock Compensation Expense for the three and nine months ended June 30, 2015 and 2014 is as follows:

	Three Months Ended		Three Months Ended
Stock Compensation Expense	June 30, 2015		June 30, 2014
Stock Grants	$	106,000	$	112,000
Restricted Stock Grants		7,000		51,000
Option Grants		6,000		-
Employee Stock Purchase Plan		1,000		1,000
Total	$	120,000	$	164,000
	Nine Months Ended		Nine Months Ended
Stock Compensation Expense	June 30, 2015		June 30, 2014
Stock Grants	$	243,000	$	213,000
Restricted Stock Grants		21,000		188,000
Option Grants		10,000		-
Employee Stock Purchase Plan		3,000		2,000
Total	$	277,000	$	403,000

At June 30, 2015 there was approximately $46,000 in unrecognized stock compensation cost, which is expected to be recognized over a weighted average period of two months.

In addition to the above stock compensation expense, the Company’s 90%-owned Xcede subsidiary issued options for its common stock to certain employees and directors that resulted in approximately $7,000 and $21,000 of stock compensation expense in the three and nine months ended June 30, 2015. At June 30, 2015 there was approximately $98,000 in unrecognized Xcede stock compensation cost.