Stock Based Compensation

9 Months Ended

Jun. 30, 2012

Disclosure Of Compensation Related Costs, Share-Based Payments [Abstract]

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

Note 7 - Stock Based Compensation

The fair value of the stock options granted is estimated at the date of grant using the Black-Scholes option pricing model. The weighted average assumptions for grants during the nine months ended June 30, 2012 and 2011 used in the Black-Scholes option pricing model were as follows:

	Nine Months Ended			Nine Months Ended
	June 30, 2012			June 30, 2011
Expected term in years		5 years			3 years
Risk-free interest rate		2.64	%		3.95	%
Expected volatility		93.62	%		85.21	%
Expected dividend yield		0.00	%		0.00	%

The expected volatility was determined with reference to the historical volatility of the Company's stock. The Company uses historical data to estimate option exercise and employee termination within the valuation model. The expected term of options granted represents the period of time that the options granted are expected to be outstanding. This estimate was increased form three to five years in 2012. The risk-free interest rate for periods within the contractual life of the option is based on the U.S. Treasury rate in effect at the time of grant. The dividend yield is expected to be 0.00% because historically the Company has not paid dividends on common stock.

During the three months ended June 30, 2012, no stock options were granted or exercised. During the three months ended June 30, 2012, 121,980 options were cancelled or expired with a weighted average exercise price of $1.76.

During the three months ended June 30, 2012 and 2011, 6,666 and 25,000 shares of restricted stock vested with the value of $26,131 and $100,500, respectively. During the nine months ended June 30, 2012 and 2011, 44,666 and 25,000 shares of restricted stock vested with the value of $178,636 and $100,500, respectively.

Stock Compensation Expense for the three months ended June 30, 2012 and 2011 is as follows:

	Three Months Ended		Three Months Ended
Stock Compensation Expense	June 30, 2012		June 30, 2011
Stock Grants		43,000		-0-
Restricted Stock Grants		159,552		100,500
Option Grants		37,206		21,948
Employee Stock Purchase Plan		3,300		-0-
Total	$	243,058	$	122,448

During the nine months ended June 30, 2012, 43,960 stock options were granted at an exercise price of $3.03 per share. These options were granted as Directors’ Compensation for the twelve months ending January 31, 2013, were fully exercisable when granted and expire five years from the grant date. During the nine months ended June 30, 2012, 138,373 options were exercised at an exercise price of $1.58 per share in a cashless exercise, resulting in 41,205 common shares issued. During the nine months ended June 30, 2012, 151,980 stock options were cancelled with an weighted average exercise price of $2.83.

Stock Compensation Expense for the nine months ended June 30, 2012 and 2011 is as follows:

	Nine Months Ended		Nine Months Ended
Stock Compensation Expense	June 30, 2012		June 30, 2011
Stock Grants		152,041		189,892
Restricted Stock Grants		465,303		108,125
Option Grants		168,675		199,038
Employee Stock Purchase Plan		35,568		-0-
Total	$	821,586	$	497,055

At June 30, 2012, there was $1,252,861 in unrecognized stock compensation expense based on unvested options and unvested restricted stock. At June 30, 2011, there was $1,725,677 in unrecognized stock compensation expense based on unvested options and unvested restricted stock.

A summary of restricted stock activity for the nine months ended June 30, 2012 and 2011 is presented below:

Restricted Stock Activity for the Nine Months ended June 30, 2012	Shares		Weighted-Average Grant-Date Fair Value
Nonvested at September 30, 2011		403,000	$	4.02
Granted		-0-		-0-
Vested		44,666	$	4.00
Cancelled		-0-		-0-
Nonvested at June 30, 2012		358,334	$	4.02

Restricted Stock Activity for the Nine Months ended June 30, 2011	Shares		Weighted-Average Grant-Date Fair Value
Nonvested at September 30, 2010		7,500	$	3.75
Granted		423,000	$	4.02
Vested		27,500	$	4.00
Cancelled		-0-		-0-
Nonvested at June 30, 2012		403,000	$	4.02