STOCKHOLDERS' EQUITY

9 Months Ended

Jun. 30, 2012

STOCKHOLDERS' EQUITY [Abstract]

STOCKHOLDERS' EQUITY

NOTE 4 - STOCKHOLDERS' EQUITY

On January 6, 2012, the Board of Directors granted a total of 4,750,000 stock options to officers and board of directors members of the Company under the Company's 2004 Stock Option Plan. The options vest over two years, are exercisable for a period of 2 years and have a $0.20 strike price. However, the options are only exercisable if the Company's share price reaches $0.75 per share and remains consistently at or above that level for a period of one month.  They have a grant-date fair value of $63,711 or $0.013 per share based on and independent valuation of the options using a lattice model and the following weighted average assumptions:

Risk free interest rate	0.25	%
Dividend yield	0.00	%
Annual volatility	105.97	%
Exit/Attrition rates	2.00	%
Target exercise multiple	2.14

During the nine months ended June 30, 2012, the Company recognized compensation expense of $13,819 related to the options grant as described above.  As of June 30, 2012, none of the options are exercisable, the weighted average remaining term is 1.5 years and the intrinsic value is zero. Unamortized compensation cost related to these options amounted to $49,892 which is expected to be recognized over a remaining period of 1.5 years.

In February 2010, the Company granted 237,500 shares for 2010 employee services rendered which had a vesting period of 2 years and a fair value of $156,750. The Company recognized stock based compensation expense for the nine months ended June 30, 2012 of $28,342 in connection with these shares. Unamortized compensation cost for these shares amounted to zero as of June 30, 2012.

During the nine months ended June 30, 2012, there were no new warrants granted and none were exercised, cancelled or expired.  As of June 30, 2012, the Company has 13,777,729 outstanding and exercisable warrants with a weighted average exercise price and remaining term of $0.32 per share and 2.7 years, respectively.  As of June 30, 2012, these warrants have an intrinsic value of zero.