Quarterly report pursuant to Section 13 or 15(d)

9. Stock Options

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9. Stock Options

6 Months Ended

Mar. 31, 2016

From time to time, the Company grants stock options and restricted stock awards to officers, directors, employees and consultants. These awards are valued based on the grant date fair value of the instruments, net of estimated forfeitures. The value of each award is amortized on a straight-line basis over the requisite service period.

Stock Options

The following table summarizes stock option activity for the six months ended March 31, 2016:

			Weighted		Weighted
			Average		Average
	Number of		Exercise		Remaining
	Shares		Price		Contractual Life		Intrinsic Value
Outstanding at September 30, 2015		1,050,000	$	1.87		4.76	$	225,750
Granted		–
Exercised		–
Forfeited		–
Outstanding at March 31, 2016		1,050,000	$	1.87		4.26	$	125,375
Exercisable at March 31, 2016		675,000	$	1.73		3.76	$	125,375

The Company recognized compensation expense of $174,855 and $48,399 during the six months ended March 31, 2016 and 2015, respectively, related to stock option awards granted to certain employees and executives based on the grant date fair value of the awards, net of estimated forfeitures.

At March 31, 2016, the Company had $84,913 of unrecognized compensation expense (net of estimated forfeitures) associated with stock option awards which the Company expects will be recognized through June 2017.

The exercise price for options outstanding and exercisable at March 31, 2016 is as follows:

Outstanding				Exercisable
Number of		Exercise		Number of		Exercise
Options		Price		Options		Price
	187,500	$	0.83		187,500	$	0.83
	150,000		1.25		150,000		1.25
	187,500		1.67		37,500		1.67
	37,500		2.08		–		2.08
	37,500		2.50		–		2.50
	450,000		2.53		300,000		2.53
	1,050,000				675,000

The following table summarizes information about the Company’s non-vested shares as of March 31, 2016:

			Weighted- Average
	Number of		Grant-Date
Non-vested Shares	Shares		Fair Value
Nonvested at September 30, 2015		375,000	$	1.44
Granted		–
Vested		–
Nonvested at March 31, 2016		375,000	$	1.44

- Definition

The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details.

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