Stock-based Compensation, Equity Grants, and Warrants (Tables)

3 Months Ended

Dec. 31, 2019

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

Schedule of Stock-based Compensation Expense

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

		(in thousands)
		Three Months Ended
	Ref	December 31,
		2019		2018
DLH employees		$	116	$	62
Non-employee directors	(a)	87		131
Total stock option expense		$	203	$	193

Ref (a): Equity grants of restricted stock units, in accordance with DLH compensation policy for non-employee directors were made in the first quarter of fiscal 2020 and in total 90,000 restricted stock units were granted.

Unrecognized stock-based compensation expense

		(in thousands)
		December 31,
	Ref	2019
Unrecognized expense for DLH employees	(a)	$	1,229
Unrecognized expense for non-employee directors		260
Total unrecognized expense		$	1,489

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. On a weighted average basis, this expense is expected to be recognized within the next 3.60 years.

Schedule of Stock Option Activity

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, 2019		2,134		$	4.36	5.9	$	4,815
Granted	(a)	250		$	4.17	—	—
Exercised		(20	)	$	1.34	—	—
Options outstanding, December 31, 2019		2,364		$	4.34	6.8	$	4,353

Ref (a): Utilizing a volatility range of 50% along with assumptions of a 10 year term and the aforementioned 10-day stock price threshold results in an indicated range of value of the Options granted during the quarter ended December 31, 2019, as follows using the Monte Carlo Method.

Schedule of Fair Value Assumptions of Stock Options

									Volatility
									50%
						Vesting		Expected
		Strike		Stock		Threshold		Term	Calculated
Grant Date	Ref	Price		Price		Price		(Years)	Fair Value
October 18, 2019	(a)	$	4.17	$	4.17	Service		10	$	2.54
October 18, 2019		$	4.17	$	4.17	$	8.00	10	$	2.56
October 18, 2019		$	4.17	$	4.17	$	10.00	10	$	2.53
October 18, 2019		$	4.17	$	4.17	$	12.00	10	$	2.51
Notes:
Results based on 100,000 simulations

Ref (a): Options granted vest after completion of a one year year service period.

Schedule of Option Shares Outstanding, Vested and Expected to Vest

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

		(in thousands)
		December 31,	September 30,
	Ref	2019	2019
Vested and exercisable	(a)	1,280	1,300
Unvested	(b)	1,084	834
Options outstanding		2,364	2,134

Ref (a): Weighted average exercise price of vested and exercisable shares was $1.52 and $1.51 at December 31, 2019 and September 30, 2019, respectively. Aggregate intrinsic value was approximately $3.5 million and $3.9 million at December 31, 2019 and September 30, 2019, respectively. Weighted average contractual term remaining was 3.7 and 3.8 years at December 31, 2019 and September 30, 2019, respectively.