Stock Options

In 1995, the Company adopted the 1995 Stock Option Plan (the “1995 Plan”) for employees and directors. In August 1999, the Company adopted the 1999 Stock Option Plan (the “1999 Plan”) and in 2010, the Company’s Board of Directors approved the 2010 Stock Option Plan (the “2010 Plan”) (collectively, “the Plans”). The 2010 Plan was approved by the shareholders of the Company at the 2011 Annual Meeting of Stockholders. At the 2012 Annual Meeting of Stockholders, shareholders approved amending the 2010 Plan to increase the maximum aggregate number of shares of common stock that may be optioned and sold from 500,000 to 800,000. The options granted under the Plans may be either incentive stock options or non-qualified options. The Plans are administered by the Board of Directors or by a compensation committee of the Board of Directors. The Board of Directors has the exclusive power to select individuals to receive grants, to establish the terms of the options granted to each participant, provided that all options granted shall be granted at an exercise price not less than of the fair market value of the common stock covered by the option on the grant date and to make all determinations necessary or advisable under the Plans.

Following is a summary of options activity:

					Weighted
					Average		Aggregate
			Weighted		Remaining		Intrinsic
			Average		Contractual		Value at
			Exercise		Term		September
(in thousands, except exercise prices and contractual terms)	Options		Price		(Years)		30, 2015
Outstanding at September 30, 2012		785		8.36
Granted		10		8.70
Expired or cancelled		(30)		7.15
Exercised		-		-
Outstanding at September 30, 2013		765	$	8.41
Granted		-
Expired or cancelled		(385)		8.35
Exercised		(370)		8.40
Outstanding at September 30, 2014		10	$	8.70
Granted		-		-
Expired or cancelled		-		-
Exercised		(10)		8.70
Outstanding at September 30, 2015		-	$	-		-	$	-
Exercisable at September 30, 2015		-	$	-		-	$	-

On June 27, 2012, the Company issued 100,000 options to the Company’s directors. These options became exercisable in June 2013, had a strike price of $ 8.78 per share and were to expire in June 2014. The fair value of these options were estimated to be $ 160,488 at the date of grant using a Black-Scholes option-pricing model using the following weighted average assumptions:

Volatility	37	%
Expected life	1.5 years
Expected dividend yield	-
Risk free rate	0.31	%

On July 2, 2012, the Company issued 655,000 options to certain Company employees. Of these options, 442,500 were exchanged for existing options which were to expire in September 2012. These new options became exercisable in July 2013, had a strike price of $ 8.35 per share and were to expire in July 2014. The fair value of these options was estimated to be $ 966,493 at the date of grant using a Black-Scholes option-pricing model using the following weighted average assumptions:

Volatility	37	%
Expected life	1.5 years
Expected dividend yield	-
Risk free rate	0.30	%

In June 2013, the Company issued 10,000 options to a Company employee. These options became exercisable in June 2014, have a strike price of $ 8.70 per share and expire in June 2015. The fair value of these options was estimated to be $ 11,670 at the date of grant using a Black-Scholes option-pricing model using the following weighted average assumptions:

Volatility	27	%
Expected life	1.5 years
Expected dividend yield	-
Risk free rate	0.27	%

The Black-Scholes option valuation model was developed for use in estimating the fair value of traded options, which have no vesting restrictions and are fully transferable. In addition, option valuation models require the input of highly subjective assumptions including the expected stock price volatility. Because changes in the subjective input assumptions can materially affect the fair value estimate, in management's opinion, the existing models do not necessarily provide a reliable single measure of the fair value of its employee stock options. The expected life of awards granted represents the period of time that they are expected to be outstanding. The Company determined the initial expected life based on a simplified method, giving consideration to the contractual terms, vesting schedules and pre-vesting and post-vesting forfeitures. The Company has utilized the simplified method in accordance with US GAAP for the following reasons. Earlier in the Company’s existence, longer-term options (generally 5 -year lives) were issued to employees, Directors and outsiders. In more recent years, option terms have generally become shorter (1 - 3 year lives) and options were issued principally to management and Directors. Then in 2010, short-term options (2 -year lives) were issued to Directors, management and a substantial number of employees. Due to the changes in the terms of the option grants and the type of persons receiving the options, we believe that the historical exercise data may no longer provide a reasonable basis upon which to estimate expected term. Therefore, the Company believes that the use of the simplified method for determining the expected term of the Company’s options has been appropriate.

During the years ended September 30, 2015, 2014 and 2013, the Company recorded none, $159,370 and $847,183 of stock-based compensation, related to stock options, respectively. There was no unamortized stock compensation expense at September 30, 2015 related to stock options.