Share-Based Compensation

3 Months Ended

Sep. 30, 2015

8.	Share-Based Compensation

As of September 30, 2015, we had share-based compensation plans which are described in Note 11 of the consolidated financial statements included in our Annual Report on Form 10-K for the year ended June 30, 2015. We recognize stock compensation expense over the requisite service period of the individual grantees, which generally equals the vesting period. As of September 30, 2015, we had 89,447 stock options outstanding and 422,303 restricted shares outstanding (after giving effect to the retroactive rescission of 120,000 RSAs previously granted to our CEO as described in Note 2 - Immaterial Restatement of Previously Issued Financial Statements and Reclassification). No stock options were granted, exercised, or cancelled during the three months ended September 30, 2015. We recorded share-based compensation related to the issuance of restricted stock to employees and board members as follows:

	Three Months Ended
	September 30,
	2015		2014

Share-based compensation expense included in the consolidated statement of operations:
Cost of sales	$	1	$	14
Sales and marketing		30		40
Research and development		31		28
General and administrative		105		144
Total		167		226

A summary of the activity of our time-based, service condition restricted shares during the three months ended September 30, 2015, is presented below:

		Weighted-
		Average
		Grant Date
Restricted Stock Awards	Shares	Fair Value

Non-vested at July 1, 2015⁽¹⁾	250,690	$	6.61
Granted	212,500		4.68
Vested	(31,199)		5.83
Forfeited	(15,075)		6.72
Non-vested at September 30, 2015	416,916	$	5.68

⁽¹⁾Reflects the retroactive rescission of 120,000 restricted stock awards previously granted to the Company's president and CEO.

During the three months ended September 30, 2015, 20,500 previously granted performance-based restricted shares were forfeited due to a failure to meet performance goals associated with our fiscal year 2015 financial results. A summary of the activity of our performance-based restricted shares during the three months ended September 30, 2015, is presented below:

			Weighted-
			Average
			Grant Date
Performance Stock Awards	Shares		Fair Value

Non-vested at July 1, 2015		25,887	$	5.84
Granted		-		-
Vested		-		-
Forfeited		(20,500)		6.93
Non-vested at September 30, 2015		5,387	$	5.14