STOCK-BASED COMPENSATION

12 Months Ended

Sep. 30, 2015

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

9. STOCK-BASED COMPENSATION

Summary of Stock Option Plans and Activity

In March 2008, our shareholders approved the 2008 Stock Option Plan (the “Plan”) to replace the 1997 Outside Director Stock Option Plan and the 1997 Employee Stock Option Plan. Future common shares will be granted from the 2008 Stock Option Plan. The purpose of the Plan is to promote our long-term interests by providing a means of attracting and retaining officers, directors and key employees. The Compensation Committee administers the Plan and approve the particular officers, directors or employees eligible for grants. Under the Plan, employees are granted the option to purchase our common shares at fair market value on the date of the grant. Generally, options granted vest and become exercisable in four equal installments commencing one year from date of grant and expire upon the earlier of the employee’s termination of employment with us, or ten years from the date of grant. The Plan terminates in fiscal 2018. The maximum number of common shares that may be granted under the Plan is 500 shares. At September 30, 2015, 190 shares remained available for grants under the Plan.

The Compensation Committee has also issued non-qualified stock option grants with vesting periods different from the Plan. As of September 30, 2015 and 2014, total non-qualified stock options outstanding were 30 and 155, respectively.

The weighted-average assumptions used to compute the fair value of options granted for the fiscal years ended September 30 were as follows:

	2015		2014
Risk-free interest rate	2.15	%	2.36	%
Dividend yield	0.00	%	0.00	%
Volatility of the expected market price of the Company's common shares	95.70%- 100.10	%	94.50%- 94.70	%
Expected life of the options (years)	8.0		8.0

A summary of our stock option activity for all options and related information for the years ended September 30, 2015 and 2014, respectively, is as follows (in thousands except for share prices):

	Options (shares)	Weighted- Average Exercise Price		Weighted- Average Grant Date Fair Value		Weighted- Average Remaining Contractual Life	Aggregate Intrinsic Value

Outstanding - October 1, 2013	479	$	1.77
Exercised	(11)	$	1.14	$	0.95
Granted	40	$	2.69	$	2.25
Terminated	(82)	$	2.00
Outstanding - September 30, 2014	426	$	1.83	$	1.41	7.2	$	348

Outstanding - October 1, 2014	426	$	1.83
Exercised	(128)	$	1.38	$	1.12
Granted	65	$	2.07	$	1.72
Terminated	(44)	$	4.23
Outstanding - September 30, 2015	319	$	1.73	$	1.38	7.1	$	95

Exercisable at September 30, 2015	232	$	1.59	$	1.23	6.4	$	95

The aggregate intrinsic value is the product of the total options outstanding and the net positive difference of our common share price on September 30, 2015 and the options’ exercise price.

One hundred and twenty eight options with an intrinsic value of $74 were exercised using a cashless exercise in fiscal 2015, which resulted in the issuance of 30 common shares. Fifteen common shares with a value of $32 were withheld from a cashless option exercise for taxes owed by the employee. Eight options with an intrinsic value of $13 were exercised using a cashless exercise and 3 options with an intrinsic value of $4 were exercised using cash in fiscal 2014, which resulted in the issuance of 7 common shares. As of September 30, 2015, our total unrecognized compensation cost related to non-vested stock options was $126 and is expected to be recognized over a weighted-average service period of 1.65 years. As of September 30, 2015, there are 30 shares underlying outstanding options that were granted outside of the Plan. Stock-based compensation expense for employee stock options for the years ended September 30, 2015 and 2014 was $79 and $84, respectively.

The following table summarizes outstanding and exercisable options as of September 30, 2015 (in thousands except per share amounts):

		Weighted
		average	Weighted			Weighted
Range of		Remaining	average			average
Exercise Prices	Shares Outstanding	Contractual Life (Yrs)	Exercise Price		Shares Exercisable	Exercise Price
$0.79 - $1.01	86	5.54	$	0.96	86	$	0.96
$1.02 - $4.59	217	8.09	$	1.78	130	$	1.56
$4.60 - $8.79	16	2.93	$	5.09	16	$	5.09