Stock-Based Compensation

9 Months Ended

Oct. 31, 2017

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

Stock-Based Compensation

4.	Stock-Based Compensation

We grant stock awards for a fixed number of shares to employees, consultants’, and directors pursuant to our shareholder-approved equity incentive plans.

The total compensation cost for vested awards not yet recognized is approximately $6,750 as of October 31, 2017. The vested awards are expected to fully recognized as compensation expense by the end of fiscal year 2018.

During the three and nine months ended October 31, 2017 and 2016, no stock options and no restricted stock units were granted.

We account for stock-based compensation using the modified prospective method, which requires measurement of compensation cost for all stock awards at fair value on date of grant and recognition of compensation over the service period for awards expected to vest. The fair value of stock options is determined using the Black-Scholes valuation model for options with ratable term vesting. The valuation model requires the input of subjective assumptions. These assumptions include estimating the length of time optionees will retain their vested stock options before exercising them (the “expected term”), the estimated volatility of our common stock price over the expected term, and the number of awards that will ultimately not complete their vesting requirements (“forfeitures”). Changes in these subjective assumptions can materially affect the estimate of fair value of stock-based compensation and, consequently, the related amount recognized as an expense on the consolidated statements of operations. As required under applicable accounting rules, we review our value stock-based awards granted in future periods. The values derived from using either the Lattice Binomial or the Black-Scholes model are recognized as an expense over the vesting period, net of estimated forfeitures. The estimation of stock awards that will ultimately vest requires significant judgment. Actual results, and future changes in estimates, may differ from our current estimates.

The compensation expense recognized is summarized in the table below (in thousands except per share amounts):

		Three Months Ended								Nine Months Ended
		October 31,								October 31,
		2017				2016				2017				2016

Stock-based compensation expense		$	7			$	-			$	19			$	18
Impact on basic and diluted earnings per share		$	-			$	-			$	-			$	-

Transactions and other information related to stock options outstanding under these plans for the three and nine months ended October 31, 2017 are summarized below:

		Outstanding Options
						Weighted-Ave.
		Number of				Exercise
		Shares				Price
Balance, January 31, 2017			1,100,000			$	0.37
Options granted			-				-
Options canceled or expired			-				-
Options exercised			-				-
Balance, October 31, 2017			1,100,000			$	0.37
Stock Options Exercisable at October 31, 2017			760,000			$	0.44

As of October 31, 2017, the stock awards outstanding have an aggregate intrinsic value of $0, based on a closing market price of $0.03 per share on October 31, 2017. The following table summarizes information about the Company’s stock awards outstanding at October 31, 2017:

									Awards Outstanding												Options Exercisable
Range of									Number of options				Weighted-Ave. Remaining Contractural				Weighted-Ave. Exercise/Grant				Number of options				Weighted-Ave. Exercise
Exercise / Grant Prices									Outstanding				Life				Price				Exercisable				Price
$	0.09									300,000				8.99			$	0.09				-			$	0.09
$	0.14		-		$	0.16				300,000				7.63			$	0.15				300,000			$	0.15
$	0.40									385,000				4.75			$	0.40				385,000			$	0.40
$	1.09									100,000				1.03			$	1.00				60,000			$	1.09
$	4.53									15,000				0.33			$	4.53				15,000			$	4.53
										1,100,000												760,000

Shares available under the plans for future grants at October 31, 2017 totaled 323,535.