Share-Based Compensation

9 Months Ended

Mar. 31, 2016

9.	Share-Based Compensation

As of March 31, 2016, 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 March 31, 2016, we had 83,582 stock options outstanding and 488,152 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). During the nine months ended March 31, 2016, no stock options were granted or exercised; however, 8,097 stock options were cancelled. We recorded share-based compensation related to the issuance of restricted stock to employees and board members as follows:

	Three Months Ended March 31,				Nine Months Ended March 31,
	2016		2015		2016		2015

Share-based compensation expense included in the consolidated statement of operations:
Cost of sales	$	8	$	13	$	16	$	40
Sales and marketing		40		9		113		81
Research and development		7		24		85		75
General and administrative		124		85		347		301
Total	$	179	$	131	$	561	$	497

A summary of the activity of our time-based, service condition restricted shares during the nine months ended March 31, 2016, is presented below:

Restricted Stock Awards	Shares		Weighted- Average Grant Date Fair Value

Non-vested at July 1, 2015⁽¹⁾		250,690	$	6.62
Granted		356,500		4.87
Vested		(70,050)		6.55
Forfeited		(54,375)		5.91
Non-vested at March 31, 2016		482,765	$	5.41

⁽¹⁾

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

During the nine months ended March 31, 2016, 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 nine months ended March 31, 2016, is presented below:

Performance Stock Awards	Shares		Weighted- Average Grant Date Fair Value

Non-vested at July 1, 2015		25,887	$	5.84
Granted		-		-
Vested		-		-
Forfeited		(20,500)		6.93
Non-vested at March 31, 2016		5,387	$	6.96