Stock Option Plans

9 Months Ended

Dec. 31, 2011

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

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

Stock Option Plans

Stock-based compensation expense is measured at the grant date, based on the fair value of the award, and is recognized on a straight-line basis over the vesting period. During the three and nine months ended December 31, 2011, stock-based compensation totaling $3,500 and $8,767, respectively, was recognized based on the fair value of the stock options granted. Stock-based compensation totaling $900 and $12,900 was recognized during the three and nine months ended December 31, 2010, respectively.

We estimate the fair value of stock options granted using the Black-Scholes option pricing model. Under this method, the average fair value of stock options granted by the Company during the nine months ended December 31, 2011 was $1.56 per share. In addition to the exercise price of the awards, certain weighted average assumptions were used to estimate the fair value of stock option grants as follows: expected volatility of 95.8%, expected dividend yield of 0%, risk-free interest rate of 1.55% and an expected option term of 6 years.

At December 31, 2011, outstanding options to purchase 1,257,667 shares of the Company’s common stock are fully vested. In addition, certain option grants contain disposition restrictions which prohibit the sale of 50% of the shares acquired by exercising the awarded options until the first anniversary of the grant date and the remaining 50% of the shares acquired by exercising the awarded options until the second anniversary of the grant date. As of December 31, 2011, the fair value of unamortized stock-based compensation expense related to unvested stock options was approximately $29,034 which is expected to be recognized over a remaining vesting period of three years.

The following table summarizes information about stock option activity for the nine months ended December 31, 2011:

						Weighted
				Weighted		Average
				Average		Remaining		Agregate
				Exercise		Contractual		Intrinsic
	Shares			Price		Term		Value
Outstanding at March 31, 2011		1,296,000		$	2.11		6.3 years
Granted		20,000		$	2.14		10 years
Expired		(25,000	)	$	2.50		7.5 years
Outstanding at December 31, 2011		1,291,000		$	2.10		5.6 years	$	95,200
Exercisable at December 31, 2011		1,257,667		$	2.11		5.5 years	$	79,200

Aggregate intrinsic value represents the total pretax intrinsic value, based on options with exercise prices less than the Company’s closing price of $2.00 as of December 31, 2011, which would have been recognized by the option holders had these option holders exercised their options as of that date.

During September 2011, the Company issued warrants to purchase an aggregate of 75,000 shares of the Company’s common stock in connection with consulting services for investor relations services. The warrants have a four and one-half year term and are currently exercisable as follows: warrants to purchase 25,000 shares of common stock at an exercise price of $3.00 per share; warrants to purchase 25,000 shares of common stock at an exercise price of $4.00 per share; and warrants to purchase 25,000 shares of common stock at an exercise price of $5.00 per share. The shares underlying the warrants are not registered and are subject to certain trading restrictions.

The Company recognized $82,250 of stock-based compensation expense related to investor relations services based on a fair value weighted average of the warrants of $1.17. The fair values of the warrants was calculated using the Black-Scholes option pricing model with the following weighted average assumptions: expected volatility, 93.6%; risk-free interest rates of 0.97%; expected option term, four and one-half years; and expected dividend yields of 0%.