Quarterly report pursuant to Section 13 or 15(d)

STOCKHOLDERS' EQUITY

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STOCKHOLDERS' EQUITY
 9 Months Ended
Jun. 30, 2011
Stockholders' Equity Note [Abstract]  
Stockholders' Equity Note Disclosure [Text Block]
NOTE 8 —
STOCKHOLDERS’ EQUITY
 
Preferred Stock
 
On March 25, 2011 Beacon offered in a private placement 350 units (the "Series C-1 Units "), to two existing shareholders, at a purchase price of $2 per Series C-1 Unit.  Each Series C-1 Unit is comprised of (i) one (1) share of $2 Stated Value Series C-1 Convertible Preferred Stock (with each share having 130% nonparticipating liquidation preference, bearing dividends at a rate of 6% per annum payable quarterly in cash or additional Preferred Stock at the holder’s option and convertible at the holder’s discretion into 2,000 shares of the Company’s Common Stock, at a conversion price of $0.75, and (ii) a five (5) year warrant to purchase 1,000 shares of its Common Stock (each, an "Investor Warrant ") at a purchase price of $0.75 per share (collectively the "Series C-1 Offering ").  As of June 30, 2011, we completed the sale of 350 Series C-1 Units for an aggregate purchase price of $525 and issued 350,000 warrants having a fair value, as determined using the Black Scholes pricing model, of $112.
 
On May 4, 2011 Beacon offered in a private placement 100 units (the "Series C-2 Units "), at a purchase price of $2 per Series C-2 Unit.  A Series C-2 Unit comprised of (i) one (1) share of $2 Stated Value Series C-2 Convertible Preferred Stock (with each share having 125% nonparticipating liquidation preference, bearing dividends at a rate of 6% per annum payable quarterly in cash or additional Preferred Stock at the company’s option and convertible at the holder’s discretion into 2,000 shares of the Company’s Common Stock, at a conversion price of $0.75, and (ii) a five (5) year warrant to purchase 1,000 shares of its Common Stock (each, an "Investor Warrant ") at a purchase price of $0.75 per share (collectively the "Series C-2 Offering ").  As of June 30, 2011, we completed the sale of 100 Series C-2 Units for an aggregate purchase price of $150 and issued 100,000 warrants having a fair value, as determined using the Black Scholes pricing model, of $32.
 
Each share of preferred stock has voting rights equal to the equivalent number of common shares into which it is convertible. The holders of the Series A and Series A-1 are entitled to receive contractual cumulative dividends in preference to any dividend on the common stock at the rate of 10% per annum on the initial investment amount commencing on the date of issue.  The holders of the Series B, C-1 and C-2 are entitled to receive contractual cumulative dividends in preference to any dividend on the common stock (but subject to the rights of the previously issued series of preferred stock) at the rate of 6% per annum on the initial investment amount commencing on the date of issue.  Such dividends are payable on January 1, April 1, July 1 and October 1 of each year.  Dividends accrued but unpaid as of June 30, 2011, are $46, $58, $105 and $8 for Series A, A-1, B and C-1, respectively.
 
For services performed in connection with Series C private placements, Beacon paid a placement agent fee of $68 and issued 90,000 placement agent warrants.  Using the Black Scholes pricing model, we determined the fair value of the warrants and recorded as other expense of $29.
 
 The Company applies the classification and measurement principles enumerated in ASC 815 with respect to accounting for its issuances of the preferred stock. The Company is required, under Nevada law, to obtain the approval of its Board of Directors in order to effectuate a merger, consolidation or similar event resulting in a more than 50% change in control or a sale of all or substantially all of its assets.
 
We evaluate convertible preferred stock at each reporting date for appropriate balance sheet classification.

Preferred Stock Dividends
 
 We follow the guidelines of ASC 505 Equity - Dividends and Stock Splits when accounting for pay-in-kind (“PIK”) dividends that are settled in convertible securities with beneficial conversion features. Therefore, we recorded $0 and $24 of deemed dividends for the three months ended June 30, 2011 and 2010, respectively, related to the conversion feature based on the difference between the effective conversion price of the conversion option and the fair value of the common stock on the PIK election dates.  We recorded $0 and $24 of deemed dividends for the three months ended June 30, 2011 and 2010, respectively, related to the conversion feature based on the difference between the effective conversion price of the conversion option and the fair value of the common stock on the PIK election dates.  We recorded $0 and $93 of deemed dividends for the nine months ended June 30, 2011 and 2010, respectively, related to the conversion feature based on the difference between the effective conversion price of the conversion option and the fair value of the common stock on the PIK election dates.
 
Issuance of non-employee compensatory options
 
During the fiscal year ended September 30, 2010, in consideration for services, we granted options to purchase 250,000 shares of Common Stock vesting ratably over a 36 month period.  We calculated the fair value of the options using the Black-Scholes option pricing model resulting in a fair value determination of $188, to be recognized over a 36 month period. For the three months ended June 30, 2011 and 2010, respectively we recognized share based compensation of $16 and $16, respectively related to these options.  For the nine months ended June 30, 2011 and 2010, respectively we recognized share based compensation of $47 and $19, respectively related to these options.
 
Stock Options and Other Equity Compensation Plans
 
During the three months ended December 31, 2010, our Board of Directors authorized the grant of employee stock options to purchase an aggregate of 725,115 shares of common stock.  The options have ten year terms with vesting periods ranging from 3 and 5 years.  We calculated the $447 fair value of the options using the Black-Scholes option pricing model with the assumptions shown below.
 
During the three months ended March 31, 2011, our Board of Directors authorized the grant of employee stock options to purchase an aggregate of 18,333 shares of common stock.  The options have ten year terms and vest over 3 years.  We calculated the $9 fair value of the options using the Black-Scholes option pricing model with the assumptions shown below.
 
During the three months ended June 30, 2011, our Board of Directors authorized the grant of employee stock options to purchase an aggregate of 100,000 shares of common stock.  The options have a ten year term and vest upon attainment of certain performance objectives.  As of June 30, 2011, we have not recorded any expense related to these options as the probability of achievement of the performance objectives is not likely.  We calculated the $31 fair value of the options using the Black-Scholes option pricing model with the following assumptions:
 
   
For the Three
   
For the Nine
 
   
Months Ended
   
Months Ended
 
   
June 30,
   
June 30,
 
   
2011
   
2011
 
Stock Price
  $ 0.34     $ 0.34 - $0.63  
Expected Life
    5.5       5.5 - 7.5  
Volatility
    166 %     166% - 178 %
Risk-free interest rate
    1.68 %     1.17% - 2.30 %
Dividend Yield
    0 %     0 %
Fair value of options
  $ 0.31     $ 0.31 - $0.62  
 
We recognized non-cash share-based employee compensation expenses as follows:
 
   
For the Three
   
For the Three
   
For the Nine
   
For the Nine
 
   
Months Ended
   
Months Ended
   
Months Ended
   
Months Ended
 
   
June 30,
   
June 30,
   
June 30,
   
June 30,
 
   
2011
   
2010
   
2011
   
2010
 
                         
Non-Cash Share-Based Compensation Expense
                       
Restricted Stock
  $ 19     $ 166     $ 19     $ 221  
Stock Options
    175       294       544       725  
Total Stock Compensation Expense
  $ 194     $ 460     $ 563     $ 946  
 
A summary of the status of our stock option plan and the changes during the three and nine months ended June 30, 2011, is presented in the table below:
               
Weighted
       
               
Average
       
         
Weighted
   
Remaining
   
Aggregate
 
   
Number
   
Average
   
Contractual
   
Intrinsic
 
   
Of Options
   
Exercise Price
   
Life
   
Value
 
                         
Options Outstanding at October 1, 2010
    3,718,533     $ 1.47              
Granted
    843,448       0.93              
Forfeited
    (868,893 )     (1.40 )            
Options Outstanding at June 30, 2011
    3,693,088     $ 1.00       8.46     $ -  
Options Exercisable, June 30, 2011
    1,841,865     $ 1.22       8.18     $ -  

As of June 30, 2011, there was $1,087 in unamortized share-based compensation cost. This cost is expected to be recognized over the remaining weighted average vesting period of approximately 3 years.