STOCK-BASED COMPENSATION PLAN AND WARRANTS (Tables)

9 Months Ended

Sep. 30, 2013

STOCK-BASED COMPENSATION PLAN AND WARRANTS [Abstract]

Summary of the status of stock options

A summary of the status of stock options under the Plan as of September 30, 2013 and December 31, 2012 is as follows:

	9/30/2013					12/31/2012
	Number of Shares			Weighted Average Exercise Price		Number of Shares			Weighted Average Exercise Price
Outstanding at beginning of year		7,728,877		$	1.01		5,645,202		$	1.10
Granted		2,176,535		$	1.67		2,354,275		$	0.80
Exercised		(293,650	)	$	0.98		(230,600	)	$	1.09
Expired and Cancelled		(4,500	)	$	1.67		(40,000	)	$	0.86
		9,607,262					7,728,877
Outstanding, end of period		9,607,262		$	1.16		7,728,877		$	1.01
Exercisable at end of period		8,920,148		$	1.14		7,582,022		$	1.03

Stock option valuation assumptions

The fair value of each stock option granted is estimated on the date of grant using the Black-Scholes option valuation model.  This model uses the assumptions listed in the table below for stock options granted in 2013.  Expected volatilities are based on the historical volatility of the Company’s stock.  The risk-free rate for periods within the expected life of the option is based on the U.S. Treasury yield curve in effect at the time of grant.

	9/30/2013
Weighted average fair value per option granted	$	1.04
Risk-free interest rate		0.65 - 0.81	%
Expected dividend yield		0.00	%
Expected lives		2.695
Expected volatility		99.79 - 108	%

Stock options outstanding by price range

Stock options outstanding at September 30, 2013 are as follows:

				Weighted
				Average		Weighted
				Remaining		Average
		Options		Contractual		Exercise		Options
Range of Exercise Prices		Outstanding		Life		Price		Exercisable
$	0.01-$1.50		7,090,227		2.8	$	0.97		6,990,247
$	1.51-$3.00		2,382,035		4.5	$	1.67		1,794,901
$	3.01-$5.00		135,000		4.6	$	3.11		135,000
			9,607,262		3.3	$	1.17		8,920,148

Summary of warrant activity

The summary of the status of the warrants issued by the Company as of September 30, 2013 and December 31, 2012 are as follows:

	9/30/2013					12/31/2012
	Number of Warrants			Weighted Average Exercise Price		Number of Warrants			Weighted Average Exercise Price
Outstanding at beginning of year		23,376,250		$	1.46		23,736,108		$	1.55
Granted		2,610,295		$	1.27		650,000		$	0.83
Exercised		(2,287,730	)	$	1.28		(490,424	)	$	0.62
Cashless Exercises		(7,995,763	)	$	1.44		(335,541	)	$	0.91
Expired and Cancelled		(242,812	)	$	0.89		(183,893	)	$	14.73
		15,460,241					23,376,250
Outstanding, end of period		15,460,241		$	1.47		23,376,250		$	1.46
Exercisable at end of period		15,460,241		$	1.47		23,376,250		$	1.46