Stock Based Compensation

3 Months Ended

Dec. 31, 2015

Stockholders' Equity Note [Abstract]

Stockholders' Equity Note Disclosure [Text Block]

Note 9 - 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 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 zero because historically the Company has not paid dividends on common stock.

The Company’s Xcede joint venture adopted an Equity Incentive Plan in 2013 which provides for, among other incentives, the granting to officers, directors, employees and consultants options to purchase shares in Xcede’s common stock. The options granted generally vest over a 3 year period. The fair value of the stock options granted is estimated at the date of grant using the Black-Scholes option pricing model using assumptions generally consistent with those used for Company stock options. Because Xcede is not publicly traded, the expected volatility is estimated with reference to the average historical volatility of a group of publicly traded companies that are believed to have similar characteristics to Xcede.

Stock Compensation Expense for the three months ended December 31, 2015 and 2014 is as follows:

	Three Months Ended		Three Months Ended
Stock Compensation Expense	December 31, 2015		December 31, 2014
Stock Grants	$	83,000	$	57,000
Restricted Stock Grants		8,000		7,000
Option Grants		6,000		-
Employee Stock Purchase Plan		1,000		1,000
Subsidiary Option Grants		21,000		-
Total	$	119,000	$	65,000

At December 31, 2015 there was approximately $86,000 in unrecognized stock compensation cost for Dynasil, which is expected to be recognized over a weighted average period of eighteen months.

Restricted Stock Grants

A summary of restricted stock activity for the three months ended December 31, 2015 is presented below:

Restricted Stock Activity for the Three Months ended			Weighted-Average
December 31, 2015	Shares		Grant-Date Fair Value
Nonvested at September 30, 2015		27,000	$	1.04
Granted		40,000		1.70
Vested		-		-
Cancelled		-		-
Nonvested at December 31, 2015		67,000	$	1.43

Stock Option Grants

During the three months ended December 31, 2015, no Dynasil stock options were granted. A summary of stock option activity for the three months ended December 31, 2015 is presented below:

			Weighted Average		Weighted Average
	Options		Exercise Price per		Remain Contractual
	Outstanding		Share		Term (in Years)
Balance at September 30, 2015		58,212	$	2.28		1.96
Outstanding and exercisable at September 30, 2015		58,212	$	2.28		1.96
Granted		-		-
Exercised		-		-
Cancelled		-		-
Balance at December 31, 2015		58,212	$	2.28		1.71
Outstanding and exercisable at December 31, 2015		58,212	$	2.28		1.71

Subsidiary Stock Option Grants

During the three months ended December 31, 2015, 75,000 Xcede stock options were granted at an exercise price of $1.00 per share. These options vest over the next three years and expire ten years from the grant date. The weighted average assumptions for grants during the three months ended December 31, 2015 used in the Black-Scholes option pricing model were as follows:

Expected term in years	10 years
Risk-free interest rate	2.05	%
Expected volatility	82.42	%
Expected dividend yield	0.00	%

A summary of Xcede stock option activity for the three months ended December 31, 2015 is presented below:

			Weighted Average		Weighted Average
	Options		Exercise Price per		Remain Contractual
	Outstanding		Share		Term (in Years)
Balance at September 30, 2015		780,258	$	1.00		8.85
Outstanding and exercisable at September 30, 2015		180,293	$	1.00		8.50
Granted		75,000	$	1.00
Exercised		-		-
Cancelled		(35,000)	$	1.00
Balance at December 31, 2015		820,258	$	1.00		8.70
Outstanding and exercisable at December 31, 2015		201,512	$	1.00		8.21

At December 31, 2015, the Company’s Xcede joint venture had $195,000 of unrecognized stock compensation expense associated with stock options expected to be recognized over a weighted average period of nineteen months and $82,000 of unrecognized stock compensation expense that begin to vest upon the attainment of specific capital raising targets.