Quarterly report pursuant to Section 13 or 15(d)

Restricted Stock Awarded Outside the 2013 Stock Incentive Plan

Restricted Stock Awarded Outside the 2013 Stock Incentive Plan

6 Months Ended

Mar. 31, 2018

Restricted Stock Awarded Outside the 2013 Stock Incentive Plan

5.	Restricted Stock Awarded Outside the 2013 Stock Incentive Plan

On May 3, 2016, the Company awarded 2,000,000 shares of Restricted Stock to members of the Board of Directors and management in a private placement in reliance upon an exemption from registration afforded by Section 4(a)(2) of the Securities Act. The shares subject to this grant are outside the 2013 Plan and 100% shall fully vest on the second anniversary of the date of grant. In addition, in the event of a Change of Control (as such term is defined in the 2013 Plan), 100% of the grants will immediately vest.

Restricted Stock activity for the six months ended March 31, 2018 and 2017 is as follows:

	2018		2017
Non Vested at beginning of year		2,000,000		2,000,000
Awarded		-		-
Vested		-		-
Forfeited		-		-
Non Vested at March 31, 2018 and 2017		2,000,000		2,000,000

The weighted average restricted stock award date fair value information for the six months ended March 31, 2018 and 2017 follows:

	2018		2017
Non Vested at beginning of year	$	0.39	$	0.39
Awarded		-		-
Vested		-		-
Forfeited		-		-
Non Vested at March 31, 2018 and 2017	$	0.39	$	0.39

For the three months ended March 31, 2018 and 2017, compensation expense recorded for the restricted stock awards was approximately $96,000. For the six months ended March 31, 2018 and 2017, compensation expense recorded for the restricted stock awards was approximately $195,000.