Note 8 - Share-based Compensation

3 Months Ended

Sep. 30, 2016

Notes to Financial Statements

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

( 8 ) Share-based Compensation

For the three month periods ended September 30, 2016 and 2015, the Company recorded share-based compensation expense related to grants from equity incentive plans of $0.4 million and $0.6 million, respectively. No income tax benefit was recognized in the statements of operations and no share-based compensation expense was capitalized as part of any assets for the three month periods ended September 30, 2016 and 2015.

Stock Options

The fair value of each stock option award was estimated at its respective date of grant using the Black-Scholes method with the following assumptions:

	Three Months Ended September 3 0 ,
	201 6			201 5
Weighted-average risk-free interest rate		1.10	%		1.50	%
Dividend yield		—			—
Expected weighted-average volatility		.76			.75
Expected weighted-average life of options (years)		6.0			4.0
Weighted-average fair value of options granted	$	0.87		$	1.35

The risk-free rate interest rate is based on the expected life of the option and the corresponding U.S. Treasury bond, which in most cases is the U.S. five year Treasury bond. The expected term of stock options granted is derived from actual and expected option behavior and represents the period of time that options granted are expected to be outstanding. The Company uses historical data to estimate option exercise patterns and future employee terminations to determine expected life and forfeitures. Expected volatility is based on the historical volatility of the Company’s publicly traded common stock.

A summary of the Company’s outstanding stock option activity for the three months ended September 30, 2016 is as follows:

	Number of Stock Options			Weighted Average Exercise Price Per Option		Weighted-Average Remaining Contractual Term		Aggregate Intrinsic Value($000)
						(In Years)
Outstanding at June 30, 2016		4,751,423		$	4.07				-
Granted		1,310,000			1.33
Exercised		—			—
Forfeited or expired		(254,523	)		2.59
Outstanding at September 30, 2016		5,806,900		$	3.52		7.4	$	-

The total intrinsic value of stock options exercised during the three month period ended September 30, 2016 was zero, and no cash proceeds were received by the Company. Further, no actual tax benefits were realized, as the Company currently records a full valuation allowance for all tax benefits due to uncertainties with respect to its ability to generate sufficient taxable income in the future.

The following tables summarize information relating to outstanding and exercisable options as of September 30, 2016:

				September 30 , 2016
				Outstanding Weighted Average							Exercisable
Exercise Prices				Number of Stock Options		Remaining Contractual Life		Weighted Average Exercise Price		Number of Stock Options		Weighted Average Exercise Price
						(In Years)
$	1.30	—	1.40		1,514,167		9.82	$	1.34		9,167	$	1.37
$	1.50	—	2.45		1,617,547		8.02		2.26		491,460		2.37
$	2.47	—	4.07		2,274,000		5.79		3.29		1,587,290		3.61
$	4.15	—	39.60		401,186		4.89		18.08		308,686		22.02
					5,806,900		7.40	$	3.52		2,396,603		5.72

 

Restricted Stock Units and Market Stock Units (MSUs).

A summary of the Company’s outstanding restricted stock and market stock unit (MSU) activity for the three months ended September 30, 2016 is as follows:

	Shares			Weighted Average Grant Date Fair Value
Balance at June 30, 2016		49,206		$	4.00
Awarded		-			-
Released		-			-
Forfeited		(4,375	)		4.00
Balance at September 30, 2016		44,831		$	4.00

As of September 30, 2016 there was $2.9 million of unrecognized share-based compensation expense related to all unvested share-based awards. Unrecognized stock-based compensation expense for equity awards will be adjusted for future changes in estimated forfeitures. This balance is expected to be recognized over a weighted-average period of approximately 2.1 years.