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STOCK-BASED COMPENSATION

12 Months Ended

Sep. 30, 2022

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION

15. STOCK-BASED COMPENSATION

On January 2, 2020 the Company granted its employees options to purchase 38,000 ordinary shares at the price of US$5.3 (“Tranche 21”), on April 14, 2021 the Company granted its employees options to purchase 160,000 ordinary shares at the price of US$13.99 (“Tranche 21”). On Jan 3, 2022 the Company granted its employees options to purchase 40,000 ordinary shares at the price of US$7.23.

All the options have an expiration date that is 5 to 10 years from the date of grant and vest immediately or over a period of 1 to 5 years. 33,000 and -nil- options under the 2009 Plan, and 284,370 and 303,060 options under the 2014 Plan were outstanding as of September 30, 2021 and 2022 respectively.

All the option awards have an exercise price of US$5.19 to US$20.7 and expire 5 to 10 years from the date of grant and vest immediately or over a period of 1 to 10 years.

For the options outstanding at September 30, 2021 and 2022, the weighted average remaining contractual lives are 0.26 and–nil- years, respectively.

The Company recorded share-based compensation expense for share options of RMB0.66 million and RMB 10.95 million and RMB1.04 million for the years ended September 30, 2020, 2021 and 2022 respectively. As of September 30, 2021 and 2022, there were RMB-nil- and RMB 0.17 million of total unrecognized compensation expense related to non-vested share-based compensation arrangement under the 2014 Plan.

Under the term of the 2014 Plan, on March 1, 2018, June 1, 2018 and September 1, 2018 the Company granted total of 22,500 restricted shares to its management at an aggregate value of US$167,925, based on the stock closing price of US$8.6, US$7.2 and US$6.6 at March 1, 2018, June 1, 2018 and September 1, 2018, respectively. The vesting period of these shares was 1 year from the grant date, which is March 1, 2019, June 1, 2019 and September 1, 2019, respectively. The Company issued a total of 320,000 restricted shares to its management and employees during the year ended September 30, 2020. The Company recorded share-based compensation expense for restricted shares of RMB11.6 million, RMB -nil- and RMB -nil- for the years ended September 30, 2020, 2021 and 2022, respectively.

During the fiscal year ended September 30, 2020, we awarded an aggregate of 30,000 treasury stock shares to its employees and recorded share-based compensation expense of RMB1,595, and resulted in decrease RMB7,212 cost of treasury stocks.

During the fiscal year ended September 30, 2021, we awarded an aggregate of 14,386 treasury stock shares to its employees, and resulted in decrease RMB4,223 cost of treasury stocks. We didn’t award any treasury stock shares in the fiscal year ended September 30, 2022.

A summary of the stock option activity under the 2009 and 2014 Plans is as follows:


		Tranche		Tranche		Tranche		Tranche		Tranche		Tranche		Tranche		Tranche		Tranche		Tranche		Tranche		Tranche		Tranche
		11		12		13		14		15		16		17		18		19		20		21		22		23
		January 4,		April 19,		May 16,		August 3,		January 3,		October 2,		December 22,		January 2,		March 1,		January 2,		January 2,		April 14,		January 3,
Grant date		2016		2016		2016		2016		2017		2017		2017		2018		2018		2019		2020		2021		2022

Outstanding as of September 30, 2019		13,500		60,000		20,000		20,000		18,000		2,500		8,800		29,000		20,000		36,000		38,000		—		—

Number of options granted		—		—		—		—		—		—		—		—		—		—		—		—		—
Options exercised		—		—		—		—		—		—		—		—		—		—		—		—		—
Options cancelled/expired		—		—		—		—		—		—		—		—		—		—		—		—		—
Outstanding as of September 30, 2020		13,500		60,000		20,000		20,000		18,000		2,500		8,800		29,000		20,000		36,000		38,000		—		—

Number of options granted		—		—		—		—		—		—		—		—		—		—		—		160,000		—
Options exercised		—		—		—		—		—		—		(1,000)		—		—		—		—		(20,930)		—
Options cancelled/expired		—		(60,000)		(20,000)		(20,000)		—		(2,500)		(6,000)		(10,000)		—		—		—		—		—
Outstanding as of September 30, 2021		13,500		—		—		—		18,000		—		1,800		19,000		—		—		—		139,070		—

Number of options granted		(1,000)																								40,000
Options exercised		(1,000)								(4,000)				(1,000)										(15,510)
Options cancelled/expired		(1,000)								(4,000)				(800)
Outstanding as of September 30, 2022		12,500		—		—		—		4,000		—		—		19,000		—		—		—		123,560		—
Options vested and exercisable
At September 30, 2021		13,500		—		—		—		18,000		—		1,800		19,000		—		—		—		139,070		—
At September 30, 2022		12,500		—		—		—		14,000		—		—		19,000		—		—		—		123,560		40,000
Weighted average fair value at the grant date (US$)		9.0		15.4		12.4		14.4		4.0		7.7		4.4		5.1		5.1		4.0		2.5		12.5		5.4

The fair value of each option granted is estimated on the date of grant using the Black-Scholes Option Pricing Model:


		Tranche		Tranche		Tranche		Tranche		Tranche		Tranche		Tranche		Tranche		Tranche		Tranche		Tranche		Tranche		Tranche
		11		12		13		14		15		16		17		18		19		20		21		22		23
Exercise price (US$)		13.8		20.5		16.5		20		20.7		16.5		8		9.1		8.2		5.19		5.3		15.85		7.23
Average risk-free interest rate		1.73	%	1.79	%	1.75	%	1.55	%	1.94	%	1.94	%	2.26	%	2.25	%	2.58	%	2.49	%	1.67	%	0.87	%	1.37	%
Expected option life (year)		5		10		10		10		5		5		5		5		5		5		5		5		5
Volatility rate		80.72	%	69.27	%	69.92	%	65.37	%	63.87	%	52.40	%	63.20	%	64.60	%	68.20	%	103	%	52.60	%	109.90	%	100.95	%
Dividend yield		—		—		—		—		—		—		—		—		—		—		—		—		—

The aggregate intrinsic value as of September 30, 2022 and 2021 is US$319 and US$219, respectively.