2. STOCK-BASED COMPENSATION

The Company’s 2008 Stock Option Plan (“the Plan”) was used to promote our long-term interests by providing a means of attracting and retaining officers, directors and key employees and aligning their interests with those of our shareholders. The Plan is described more fully in Note 9 in the Notes to the Consolidated Financial Statements in our Form 10‑K for the fiscal year ended September 30, 2018. In March 2018, our shareholders approved the amendment and restatement of the Plan in the form of the Amended and Restated 2018 Equity Incentive Plan (the "Equity Plan") and the Company currently grants equity awards from the Equity Plan. The purpose of the Equity Plan is to promote our long-term interests by providing a means of attracting and retaining officers, directors and key employees. The maximum number of common shares that may be granted under the Equity Plan is 700 shares plus the remaining shares from the 2008 Stock Option Plan.

All options granted under the Plan and the Equity Plan had an exercise price equal to the fair market value of the underlying common shares on the date of grant. We expense the estimated fair value of stock options over the vesting periods of the grants. We recognize expense for awards subject to graded vesting using the straight-line attribution method, reduced for estimated forfeitures. Forfeitures are revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates and an adjustment is recognized at that time. Stock based compensation expense for the three and nine months ended June 30, 2019 was $71 and $196, respectively. Stock based compensation expense for the three and nine months ended June 30, 2018 was $33 and $102, respectively. The additional expense in the nine months ending June 30, 2019 was due to the grants issued to our new Chief Executive Officer in January 2019, option grants to all employees that were issued as of February 6, 2019 as well as option grants for employees related to the Smithers Avanza acquisition, as described in Note 9.

A summary of our stock option activity for the nine months ended June 30, 2019 is as follows (in thousands except for share prices):


		Weighted-		Weighted-
		Average		Average
	Options	Exercise		Grant Date
	(shares)	Price		Fair Value

Outstanding - September 30, 2018	301	$	1.73	$	1.38
Exercised	(7)	$	1.13	$	0.94
Granted	483	$	1.50	$	1.10
Forfeited	(4)	$	1.75	$	1.39
Outstanding - June 30, 2019	773	$	1.59	$	1.21

The weighted-average assumptions used to compute the fair value of the options granted in the nine months ended June 30, 2019 were as follows:


Risk-free interest rate	2.51	%
Dividend yield	0.00	%
Volatility of the expected market price of the Company's common shares	71.1%-72.5	%
Expected life of the options (years)	8.0

As of June 30, 2019, our total unrecognized compensation cost related to non-vested stock options was $540 and is expected to be recognized over a weighted-average service period of 1.4 years.

During the nine months ended June 30, 2019, we granted a total of 45 shares, of which 10 shares are restricted, to our CEO under the terms of his employment agreement. A summary of our restricted share activity for the nine months ended June 30, 2019 is as follows:


		Restricted
		Shares

Outstanding – September 30, 2018		—
Granted		45
Unrestricted at Grant		(35)
Forfeited		—
Outstanding - June 30, 2019		10

As of June 30, 2019, our total unrecognized compensation cost related to non-vested restricted stock was $9 and is expected to be recognized over a weighted-average service period of 1.55 years. The total fair value of the unrestricted shares granted during the three and nine months ended June 30, 2019 was $44.