Stock-based Compensatin, Equity Grants, and Warrants

3 Months Ended

Dec. 31, 2014

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

Stock-based Compensation, Equity Grants, and Warrants

Stock-based compensation, equity grants, and warrants

Stock-based compensation expense

All grants of equity are presently made under the 2006 Long Term Incentive Plan. As of December 31, 2014, 0.9 million shares remained available for grant under the Plan. Options issued under the Plan are designated as either an incentive stock or a non-statutory stock option. No option may be granted with a term of more than 10 years from the date of grant. Exercisability of

option awards may depend on achievement of certain performance measures determined by the Compensation Committee of our Board. Shares issued upon option exercise are newly issued shares.

Stock-based compensation expense, shown in the table below, is recorded in general and administrative expenses included in our statement of operations:

		(in thousands)
		Three Months Ended
	Ref	December 31,
		2014		2013
DLH employees		$	96	$	108
Non-employee directors	(a)	177		109
Total compensation expense		$	273	$	217

Ref (a): Equity grants of restricted stock, in accordance with DLH compensation policy for non-employee directors. The shares vested immediately and stock expense was recognized accordingly.  

Unrecognized stock-based compensation expense

		(in thousands)
		Three Months Ended
		December 31,
	Ref	2014		2013
Unrecognized expense for DLH employees	(a)	$	249	$	201
Unrecognized expense for non-employee directors	(b)	125		150
Total unrecognized expense		$	374	$	351

Ref (a): Compensation expense for the portion of equity awards for which the requisite service has not been rendered is recognized as the requisite service is rendered. The compensation expense for that portion of awards has been based on the grant-date fair value of those awards as calculated for recognition purposes under applicable guidance.

Ref (b): Unrecognized stock expense related to prior years equity grants of restricted stock to non-employee directors, based on performance criteria, in accordance with DLH compensation policy for non-employee directors. The shares will vest and expense will be recorded upon future satisfaction of specified performance.

Stock option activity for the three months ended December 31, 2014

The aggregate intrinsic value in the table below represents the total pretax intrinsic value (i.e., the difference between the Company’s closing stock price on the last trading day of the period and the exercise price, times the number of shares) that would have been received by the option holders had all option holders exercised their in the money options on those dates. This amount will change based on the fair market value of the Company’s stock.

					(in years)
					Weighted
				Weighted	Average	(in thousands)
		(in thousands)		Average	Remaining	Aggregate
		Number of		Exercise	Contractual	Intrinsic
	Ref	Shares		Price	Term	Value
Options outstanding, September 30, 2014		2,380		$1.40	7.8	$	1,589
Granted		—
Cancelled	(a)	(44	)	$1.40
Options outstanding, December 31, 2014		2,336		$1.40	7.5	$	1,727

Ref (a): Shares canceled upon termination of employment or expiration of period to complete performance conditions.

Stock options shares outstanding, vested and unvested for the period ended

		(in thousands)
		Number of Shares
		December 31,
	Ref	2014	2013
Vested and exercisable		968	463
Unvested	(a)	1,368	1,755
Options outstanding		2,336	2,218

Ref (a): Certain awards vest upon satisfaction of certain performance criteria.