Note 9 - Warrants

3 Months Ended

Mar. 31, 2012

Stockholders' Equity Note Disclosure [Text Block]

Note 9.  Warrants

Warrants Issued to Investors

The fair value of the warrants was determined using the Black-Scholes-Merton option-pricing model and the following weighted average assumptions were used:

	March 31, 2012			March 31, 2011
Stock Price	$	0.60		$	1.58
Exercise Price	$	2.56		$	2.56
Expected Volatility		107	%		94	%
Expected Dividend Yield	None			None
Expected Term (in years)		4.3			5.5
Risk-free Interest Rate		0.36	%		2.26	%

As of March 31, 2012, the value of the warrant liability was $0.6 million and the change in fair value during the three months ended March 31, 2012 was a gain of $77,000. The gain was recorded as other income in the statement of operations.

Warrant activity for the three months ended March 31, 2012 and 2011 is summarized as follows:

                  In thousands of dollars

	2012				2011
			Weighted				Weighted
			Average				Average
			Exercise				Exercise
	Warrants		Price		Warrants		Price
Outstanding at January 1,		2,476,654	$	2.49		1,757,115	$	4.61
Issued		-		-		1,800,000		2.56
Expired		-		-		-		-
Warrant redemption		-		-		-		-
Exercised		-		-		-		-
Outstanding at March 31,		2,476,654	$	2.49		3,557,115	$	3.23
Currently exercisable		2,476,654	$	2.49		1,757,115	$	4.61

The following table summarizes information about warrants outstanding at March 31, 2012:

		Warrants Outstanding and Exercisable
				Weighted Average		Weighted
				Remaining		Average
Range of				Contractual		Exercise
Exercise Prices		Warrants		Life (Years)		Price
$	1.00 to $2.30		676,654		4.1	$	2.30
$	2.31 to $4.00		1,800,000		4.5	$	2.56
			2,476,654		4.3	$	2.49