STOCK-BASED COMPENSATION

3 Months Ended

Dec. 31, 2011

STOCK-BASED COMPENSATION

2. STOCK-BASED COMPENSATION

The 2008 Stock Option Plan (“the Plan”) is used to promote our long-term interests by providing a means of attracting and retaining officers, directors and key employees and aligning their interests with those of our shareholders. The Plan is described more fully in Note 9 in the Notes to the Consolidated Financial Statements in our Form 10-K for the year ended September 30, 2011. All options granted under the plan had an exercise price equal to the market value of the underlying common shares on the date of grant. We expense the estimated fair value of stock options over the vesting periods of the grants. We recognize expense for awards subject to graded vesting using the straight-line attribution method, reduced for estimated forfeitures. Forfeitures are revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates and an adjustment is recognized at that time. The assumptions used are detailed in Note 9 to the Consolidated Financial Statements in our Form 10-K for the year ended September 30, 2011. Stock based compensation expense for the three months ended December 31, 2011 and 2010 was $47 and $54, respectively. During the three months ended December 31, 2011, there was no stock option activity. There were options on 673 shares outstanding at both December 31, 2011 and September 30, 2011 with a weighted average exercise price of $2.65 per share and a weighted average grant date fair value of $1.83 per share.