0000796505
2011-12-31
0000796505
2011-09-30
0000796505
2011-10-01
2011-12-31
0000796505
2010-10-01
2010-12-31
0000796505
2010-09-30
0000796505
2010-12-31
0000796505
2012-01-20
iso4217:USD
iso4217:USD
xbrli:shares
xbrli:shares
7375003
11281027
3878000
1849000
2026758
3228864
2528067
2757151
994000
994000
228551
170243
17030379
20280285
930690
986031
5314000
2707000
2570511
2570511
-3537692
-3558797
199467
199467
11621670
9035775
29582739
30302091
969756
1439611
1035146
2465132
72726
106383
2077628
4011126
56202
61794
2133830
4072920
0.01
0.01
500
500
0
0
123262
122707
50000000
50000000
0.01
0.01
12326233
12270691
12326233
12270691
53621722
53402138
-26296075
-27295674
27448909
26229171
29582739
30302091
9165201
7246669
5370919
4280716
3794282
2965953
2773114
2459319
1021168
506634
27182
29508
500
27182
30008
1048350
536642
48751
35484
999599
501158
0.08
0.04
0.08
0.04
12299554
12019289
12726293
12629943
96081
105236
21105
21105
-21081
112153
58287
1202106
925045
230693
-92949
-58308
3045
-1939090
120342
685420
1641269
63430
38413
5232000
160659
596000
195527
-4699430
-3545
70305
37722
37681
10530
107986
48252
-3906024
1685976
5285719
6971695
Clearfield, Inc.
10-Q
--09-30
12326233
false
0000796505
Yes
No
Smaller Reporting Company
No
2012
Q1
2011-12-31
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
<font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Note
1.  Basis of Presentation</font>
</div><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
accompanying condensed financial statements are unaudited and
have been prepared by the Company in accordance with
accounting principles generally accepted in the United States
of America for interim financial information, pursuant to the
rules and regulations of the Securities and Exchange
Commission.  Pursuant to these rules and
regulations, certain financial information and footnote
disclosures normally included in the financial statements
have been condensed or omitted.  However, in the
opinion of management, the financial statements include all
adjustments, consisting of normal recurring accruals,
necessary for a fair presentation of the financial position
and results of operations and cash flows of the interim
periods presented. Operating results for the interim periods
presented are not necessarily indicative of results to be
expected for the full year or for any other interim period,
due to variability in customer purchasing patterns and
seasonal, operating and other factors. These condensed
financial statements should be read in conjunction with the
financial statements and notes thereto included in the
Company’s Annual Report on Form 10-K for the year ended
September 30, 2011.</font>
</div><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
preparation of the Company’s financial statements,
management is required to make estimates and assumptions that
affect reported amounts of assets and liabilities and related
revenues and expenses during the reporting periods. As future
events and their effects cannot be determined with precision,
actual results could differ significantly from these
estimates.</font>
</div><br/>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
<font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Note
2.  Net Income Per Share</font>
</div><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Basic
net income per common share (“EPS”) is computed
by dividing net income by the weighted average number of
common shares outstanding for the reporting period. Diluted
EPS equals net income divided by the sum of the weighted
average number of shares of common stock outstanding plus all
additional common stock equivalents, such as stock options,
when dilutive.</font>
</div><br/><table cellpadding="0" cellspacing="0" width="100%" style="">
<tr>
<td valign="bottom" style="PADDING-BOTTOM: 0.5pt">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" style="PADDING-BOTTOM: 0.5pt">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td colspan="6" nowrap="nowrap" valign="bottom" style="BORDER-BOTTOM: black 0.75pt solid">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Three
Months Ended December 31</font>
</div>
</td>
<td nowrap="nowrap" valign="bottom" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
</tr>
<tr>
<td valign="bottom" style="PADDING-BOTTOM: 0.5pt">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" style="PADDING-BOTTOM: 0.5pt">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td colspan="2" nowrap="nowrap" valign="bottom" style="BORDER-BOTTOM: black 0.75pt solid">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2011</font>
</div>
</td>
<td nowrap="nowrap" valign="bottom" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" style="PADDING-BOTTOM: 0.5pt">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td colspan="2" nowrap="nowrap" valign="bottom" style="BORDER-BOTTOM: black 0.75pt solid">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2010</font>
</div>
</td>
<td nowrap="nowrap" valign="bottom" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
</tr>
<tr>
<td valign="bottom">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Net
income per common share — basic:</font>
</div>
</td>
<td valign="bottom">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td colspan="2" nowrap="nowrap" valign="bottom">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td nowrap="nowrap" valign="bottom" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td colspan="2" nowrap="nowrap" valign="bottom">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td nowrap="nowrap" valign="bottom" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
</tr>
<tr style="background-color: #CCEEFF;">
<td valign="bottom" width="80%">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Net
income</font>
</div>
</td>
<td align="right" valign="bottom" width="1%">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font>
</td>
<td valign="bottom" width="7%" style="TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">999,599</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td align="right" valign="bottom" width="1%">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font>
</td>
<td valign="bottom" width="7%" style="TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">501,158</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
</tr>
<tr>
<td valign="bottom" width="80%">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Weighted
average shares outstanding basic</font>
</div>
</td>
<td align="right" valign="bottom" width="1%">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="7%" style="TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">12,299,554</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td align="right" valign="bottom" width="1%">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="7%" style="TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">12,019,289</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
</tr>
<tr style="background-color: #CCEEFF;">
<td valign="bottom" width="80%" style="PADDING-BOTTOM: 4px">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Net
income per common share</font>
</div>
</td>
<td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="BORDER-BOTTOM: black 2.25pt double; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font>
</td>
<td valign="bottom" width="7%" style="BORDER-BOTTOM: black 2.25pt double; TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0.08</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2.25pt double; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="BORDER-BOTTOM: black 2.25pt double; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font>
</td>
<td valign="bottom" width="7%" style="BORDER-BOTTOM: black 2.25pt double; TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0.04</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2.25pt double; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
</tr>
<tr>
<td valign="bottom" width="80%">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="7%" style="TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="7%" style="TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
</tr>
<tr style="background-color: #CCEEFF;">
<td valign="bottom" width="80%">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Net
income per common share — diluted</font>
</div>
</td>
<td valign="bottom" width="1%">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="7%" style="TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="7%" style="TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
</tr>
<tr>
<td valign="bottom" width="80%">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Net
income</font>
</div>
</td>
<td align="right" valign="bottom" width="1%">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font>
</td>
<td valign="bottom" width="7%" style="TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">999,599</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td align="right" valign="bottom" width="1%">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font>
</td>
<td valign="bottom" width="7%" style="TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">501,158</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
</tr>
<tr style="background-color: #CCEEFF;">
<td valign="bottom" width="80%">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Weighted
average shares outstanding</font>
</div>
</td>
<td align="right" valign="bottom" width="1%">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="7%" style="TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">12,299,554</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td align="right" valign="bottom" width="1%">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="7%" style="TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">12,019,289</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
</tr>
<tr>
<td align="left" valign="bottom" width="80%" style="PADDING-BOTTOM: 0.5pt">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Dilutive
impact of common stock equivalent outstanding</font>
</div>
</td>
<td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 0.5pt">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="7%" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">426,739</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 0.5pt">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="7%" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">610,654</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
</tr>
<tr style="background-color: #CCEEFF;">
<td valign="bottom" width="80%">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Weighted
average shares outstanding— diluted</font>
</div>
</td>
<td align="right" valign="bottom" width="1%">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="7%" style="TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">12,726,293</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td align="right" valign="bottom" width="1%">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="7%" style="TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">12,629,943</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
</tr>
<tr>
<td valign="bottom" width="80%" style="PADDING-BOTTOM: 4px">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Net
income per common share — diluted</font>
</div>
</td>
<td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="BORDER-BOTTOM: black 2.25pt double; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font>
</td>
<td valign="bottom" width="7%" style="BORDER-BOTTOM: black 2.25pt double; TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0.08</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2.25pt double; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="BORDER-BOTTOM: black 2.25pt double; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font>
</td>
<td valign="bottom" width="7%" style="BORDER-BOTTOM: black 2.25pt double; TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0.04</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2.25pt double; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
</tr>
</table><br/>
<div style="DISPLAY: block; TEXT-INDENT: 0pt">
<font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Note  3.
Cash, Cash Equivalents and Investments</font>
</div><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Company currently invests its excess cash in money market
accounts and bank certificates of deposit (CDs) with a term
of not more than three years. CDs with original maturities of
more than three months are reported as held-to-maturity
investments and are carried at amortized cost. The maturity
dates of the Company’s CDs at December 31, 2011 and
September 30, 2011 are as follows:</font>
</div><br/><table cellpadding="0" cellspacing="0" width="100%" style="">
<tr>
<td valign="bottom" style="PADDING-BOTTOM: 0.5pt">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" style="PADDING-BOTTOM: 0.5pt">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td colspan="2" nowrap="nowrap" valign="bottom" style="BORDER-BOTTOM: black 0.75pt solid">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">December
31,</font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2011</font>
</div>
</td>
<td nowrap="nowrap" valign="bottom" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td colspan="3" nowrap="nowrap" valign="bottom" style="BORDER-BOTTOM: black 0.75pt solid">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">September
30,</font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2010</font>
</div>
</td>
<td nowrap="nowrap" valign="bottom" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
</tr>
<tr style="background-color: #CCEEFF;">
<td align="left" valign="bottom" width="80%">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Less
than one year</font>
</div>
</td>
<td align="right" valign="bottom" width="1%">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font>
</td>
<td valign="bottom" width="7%" style="TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">3,878,000</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td align="right" valign="bottom" width="1%">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font>
</td>
<td valign="bottom" width="7%" style="TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1,849,000</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
</tr>
<tr>
<td align="left" valign="bottom" width="80%" style="PADDING-BOTTOM: 0.5pt">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1-3
years</font>
</div>
</td>
<td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 0.5pt">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="7%" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">5,314,000</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 0.5pt">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="7%" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2,707,000</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
</tr>
<tr style="background-color: #CCEEFF;">
<td align="left" valign="bottom" width="80%" style="PADDING-BOTTOM: 4px">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total</font>
</div>
</td>
<td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="BORDER-BOTTOM: black 2.25pt double; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font>
</td>
<td valign="bottom" width="7%" style="BORDER-BOTTOM: black 2.25pt double; TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">9,192,000</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2.25pt double; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="BORDER-BOTTOM: black 2.25pt double; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font>
</td>
<td valign="bottom" width="7%" style="BORDER-BOTTOM: black 2.25pt double; TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">4,445,000</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2.25pt double; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
</tr>
</table><br/>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Note
4.  Stock Based Compensation</font>
</div><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Company recorded $112,153 of compensation expense related to
current and past option grants, restricted stock grants and
the Company’s Employee Stock Purchase Plan for the
three-month period ended December 31, 2011.  The
Company recorded $58,287 of compensation expense related to
current and past equity awards for the three-month period
ended December 31, 2010.  This expense is included
in selling, general and administrative
expense.  There was no tax benefit from recording
this non-cash expense.  As of December 31, 2011,
$1,021,887 of total unrecognized compensation expense related
to non-vested awards is expected to be recognized over a
weighted average period of approximately 5.6 years.</font>
</div><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We
used the Black-Scholes option pricing model to determine the
weighted average fair value of options during the three-month
period ended December 31, 2010</font>.  The
weighted-average fair values at the grant date for options
issued during the three months ended December 31, 2010 was
$1.92. This fair value was estimated at grant date using the
weighted-average assumptions listed below.</font>
</div><br/><table cellpadding="0" cellspacing="0" width="100%" style="">
<tr>
<td valign="bottom" style="PADDING-BOTTOM: 0.5pt">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" style="PADDING-BOTTOM: 0.5pt">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td colspan="2" nowrap="nowrap" valign="bottom" style="BORDER-BOTTOM: black 0.75pt solid">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Three
months ended</font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">December
31, 2010</font>
</div>
</td>
<td nowrap="nowrap" valign="bottom" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
</tr>
<tr style="background-color: #CCEEFF;">
<td valign="bottom" width="90%">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Dividend
yield</font>
</div>
</td>
<td align="right" valign="bottom" width="1%">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="7%" style="TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">%</font>
</td>
</tr>
<tr>
<td valign="bottom" width="90%">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Expected
volatility</font>
</div>
</td>
<td align="right" valign="bottom" width="1%">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="7%" style="TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">74.17</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">%</font>
</td>
</tr>
<tr style="background-color: #CCEEFF;">
<td valign="bottom" width="90%">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Average
risk-free interest rate</font>
</div>
</td>
<td align="right" valign="bottom" width="1%">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="7%" style="TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1.58</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">%</font>
</td>
</tr>
<tr>
<td valign="bottom">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Expected
life</font>
</div>
</td>
<td align="right" valign="bottom">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td align="right" colspan="2" nowrap="nowrap" valign="bottom">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">6
years</font>
</div>
</td>
<td nowrap="nowrap" valign="bottom" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
</tr>
<tr style="background-color: #CCEEFF;">
<td valign="bottom">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Vesting
period</font>
</div>
</td>
<td align="right" valign="bottom">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td align="right" colspan="2" nowrap="nowrap" valign="bottom">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">3
years</font>
</div>
</td>
<td nowrap="nowrap" valign="bottom" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
</tr>
</table><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">During
the three month period ended December 31, 2011, the Company
did not grant any incentive stock options or non-qualified
stock options. During the three-month period ended December
31, 2010, the Company granted key employees incentive stock
options to purchase an aggregate of 5,000 shares of common
stock with a contractual term of 7 years, a three year
vesting term and an exercise price of $3.00 with a fair value
of $1.92 per share.</font>
</div><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">During
the three month period ended December 31, 2011, exercised
stock options totaled 46,106 shares, resulting in $37,681 of
proceeds to the Company. During the three month period ended
December 31, 2010, exercised stock options totaled 7,132
shares, resulting in $10,530 of proceeds to the
Company.</font>
</div><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
expected stock price volatility is based on the historical
volatility of the Company’s stock for a period
approximating the expected life. The expected life represents
the period of time that options are expected to be
outstanding after their grant date. The risk-free interest
rate reflects the interest rate at grant date on zero-coupon
U.S. governmental bonds having a remaining life similar to
the expected option term.</font>
</div><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Employee
Stock Purchase Plan</font>
</div><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Clearfield,
Inc.’s Employee Stock Purchase Plan (ESPP) allows
participating employees to purchase shares of the
Company’s common stock at a discount through payroll
deductions. The ESPP is available to all employees subject to
certain eligibility requirements. Terms of the ESPP provide
that participating employees may purchase the Company’s
common stock on a voluntary after-tax basis. Employees may
purchase the Company’s common stock at a price that is
no less than the lower of 85% of the fair market value of one
share of common stock at the beginning or end of each stock
purchase period or phase. The ESPP is carried out in
six-month phases, with phases beginning on January 1 and July
1 of each calendar year. For the phases that ended on
December 31, 2011 and December 31, 2010, employees purchased
11,267 and 17,710 shares at a price of $6.24 and $2.13 per
share, respectively. After the employee purchase on December
31, 2011, 256,504 shares of common stock were available for
future purchase under the ESPP.</font>
</div><br/>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
<font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Note
5.  Inventories</font>
</div><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Inventories
consist of the following as of:</font>
</div><br/><table cellpadding="0" cellspacing="0" width="100%" style="">
<tr>
<td valign="bottom" style="PADDING-BOTTOM: 0.5pt">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" style="PADDING-BOTTOM: 0.5pt">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td colspan="2" nowrap="nowrap" valign="bottom" style="BORDER-BOTTOM: black 0.75pt solid">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">December
31,</font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2011</font>
</div>
</td>
<td nowrap="nowrap" valign="bottom" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" style="PADDING-BOTTOM: 0.5pt">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td colspan="2" nowrap="nowrap" valign="bottom" style="BORDER-BOTTOM: black 0.75pt solid">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">September
30,</font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2011</font>
</div>
</td>
<td nowrap="nowrap" valign="bottom" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
</tr>
<tr style="background-color: #CCEEFF;">
<td align="left" valign="bottom" width="80%">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Raw
materials</font>
</div>
</td>
<td align="right" valign="bottom" width="1%">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font>
</td>
<td valign="bottom" width="7%" style="TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2,102,051</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td align="right" valign="bottom" width="1%">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font>
</td>
<td valign="bottom" width="7%" style="TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2,158,647</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
</tr>
<tr>
<td align="left" valign="bottom" width="80%">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Work-in-progress</font>
</div>
</td>
<td align="right" valign="bottom" width="1%">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="7%" style="TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">162,077</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td align="right" valign="bottom" width="1%">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="7%" style="TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">304,793</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
</tr>
<tr style="background-color: #CCEEFF;">
<td align="left" valign="bottom" width="80%" style="PADDING-BOTTOM: 0.5pt">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Finished
goods</font>
</div>
</td>
<td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 0.5pt">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="7%" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">263,939</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 0.5pt">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="7%" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">293,711</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="BORDER-BOTTOM: black 0.75pt solid; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
</tr>
<tr>
<td valign="bottom" width="80%" style="PADDING-BOTTOM: 4px">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="BORDER-BOTTOM: black 2.25pt double; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font>
</td>
<td valign="bottom" width="7%" style="BORDER-BOTTOM: black 2.25pt double; TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2,528,067</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2.25pt double; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
<td valign="bottom" width="1%" style="BORDER-BOTTOM: black 2.25pt double; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font>
</td>
<td valign="bottom" width="7%" style="BORDER-BOTTOM: black 2.25pt double; TEXT-ALIGN: right">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2,757,151</font>
</td>
<td nowrap="nowrap" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2.25pt double; TEXT-ALIGN: left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"> </font>
</td>
</tr>
</table><br/>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
<font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Note
6.  Facilities</font>
</div><br/><table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent-1" width="100%" style="">
<tr valign="top">
<td>
<div align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"> During
the second quarter of fiscal 2011, the Company
received and accepted a purchase offer on its
Aberdeen, South Dakota facility.  The Company
had not occupied the facility since fiscal year
2006.  In June 2011, the Company completed
the sale of the facility and land in the amount of
$725,000. The final proceeds to the Company after
transaction costs were $660,000. The Company recorded
a gain on the sale of these assets of approximately
$37,000 in the third quarter of fiscal
2011. </font>
</div>
</td>
</tr>
</table><br/>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Note
7.  Major Customer Concentration</font>
</div><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">One
customer, Power & Telephone Supply Company (Power &
Tel) who serves as a reseller of the Company’s product
to a range of Tier 2 and Tier 3 Telco carriers as well as
cable service operators, comprised approximately 25% and 27%
of total sales for the three months ended December 31, 2011
and 2010, respectively.</font>
</div><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">At
December 31, 2011, two customers accounted for 23% of
accounts receivable.  KGP Logistics, Inc.,
(KGP)  a reseller, accounted for 13% and Power
& Tel accounted for 10%.  At December 31, 2010,
Power & Tel accounted for 29% of accounts
receivable.  KGP’s sales did not exceed 10%
of total sales for the three months ended December 31, 2011
or 2010. Power & Tel and KGP purchase our product through
a standard form of purchase order.</font>
</div><br/>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
<font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Note
8. Goodwill and Patents</font>
</div><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Company analyzes its goodwill for impairment annually or at
an interim period when events occur or changes in
circumstances indicate potential impairment.  The
result of the analysis performed in the fourth fiscal quarter
ended September 30, 2011 did not indicate an impairment of
goodwill.  During the quarter ended December 31,
2011, there were no triggering events that indicate potential
impairment exists.</font>
</div><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Company capitalizes legal costs incurred to obtain patents.
Once accepted by either the U.S. Patent Office or the
equivalent office of a foreign country, these legal costs are
amortized using the straight-line method over the remaining
estimated lives, not exceeding 17 years. The Company
currently has three patents pending with the U.S. Patent
Office and in foreign countries.</font>
</div><br/>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
<font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Note
9. Income Taxes</font>
</div><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Company recorded a provision for income taxes of
approximately $49,000 and $35,000, for the three months ended
December 31, 2011 and 2010, respectively.  The
Company’s tax provision includes estimated current
federal alternative minimum taxes and state franchise taxes,
but is primarily related to deferred tax expense related to
book and income tax basis difference in goodwill on prior
asset acquisitions.  Our year-to-date net change in
valuation allowance is $373,000.   This change
consists of $395,000 of tax benefit as a result of a
reduction in valuation allowance after considering current
financial condition and potential future taxable
income.  This reduction is partially offset by a
$22,000 increase  in valuation  allowance
from the current year AMT tax credit generated as its
utilization does not meet the “more likely than
not” approach as required by Accounting Standards
Codification (“ASC”) 740.</font>
</div><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
of September 30, 2011 the Company had U.S. federal and state
net operating loss (NOL) carry-forwards of approximately
$27,278,000 and $22,090,000, respectively, which expire in
fiscal years 2013 to 2028 if not utilized. In fiscal 2009,
the Company completed an Internal Revenue Code Section 382
analysis of the loss carry-forwards and determined that all
of its loss carry-forwards were utilizable and not restricted
under Section 382.</font>
</div><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Deferred
taxes recognize the impact of temporary differences between
the amounts of the assets and liabilities recorded for
financial statement purposes and these amounts measured in
accordance with tax laws. The Company’s realization of
net operating loss carry-forward and other deferred tax
temporary differences is contingent upon future taxable
earnings. The Company reviewed its deferred tax asset for
expected utilization using a “more likely than
not” approach as required by ASC 740 by assessing the
available positive and negative factors surrounding its
recoverability.</font>
</div><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">During
the fourth quarter of fiscal year 2011, the Company reversed
a portion of its valuation allowance in consideration of all
available positive and negative evidence, including our
historical operating results, current financial condition,
and potential future taxable income.  The reduction
in the valuation allowance in the fourth quarter resulted in
a non-cash income tax benefit of $2,481,000.  As of
September 30, 2011, the Company had a remaining valuation
allowance of approximately $6,042,000.</font>
</div><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Company future taxable income was evaluated based primarily
on anticipated operating results from fiscal years 2012
through 2014.  The Company determined that
projecting operating results beyond 2014 involves substantial
uncertainty and the Company discounted forecasts beyond 2014
as a basis to support its deferred tax
assets.  Based upon the assessment of all available
evidence, the Company reversed a portion of its valuation
allowance for the quarter ended December 31, 2011 in an
amount in which the tax benefit generated offsets the tax
provision to be realized from current year estimated taxable
income.  The Company will continue to assess the
assumptions it uses to determine the amount of its valuation
allowance and may adjust the valuation allowance in future
periods based on changes in assumptions of estimated future
taxable income and other factors. If the valuation allowance
is reduced, the Company would record an income tax benefit in
the period in which that determination is made. If the
valuation allowance is increased, we would record additional
income tax expense. For the three months ended December 31,
2011 and 2010, the Company has reduced its valuation
allowance by approximately $373,000 and $217,000
respectively.</font>
</div><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
of December 31, 2011, we do not have any unrecognized tax
benefits.  It is the Company’s practice to
recognize interest and penalties accrued on any unrecognized
tax benefits as a component of income tax
expense.  The Company does not expect any material
changes in its unrecognized tax positions over the next 12
months.</font>
</div><br/>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
<font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Note
10.  Accounting Pronouncements</font>
</div><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">Recent Accounting
Pronouncements:</font></font>
</div><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
May 2011, the Financial Accounting Standards Board (FASB)
issued Accounting Standards Update (ASU) No. 2011-04,
<font style="DISPLAY: inline; FONT-STYLE: italic">Amendments
to Achieve Common Fair Value Measurement and Disclosure
Requirements in U.S. GAAP and International Financial
Reporting Standards (Topic 820)—Fair Value
Measurement</font> (ASU 2011-04), to provide a consistent
definition of fair value and ensure that the fair value
measurement and disclosure requirements are similar between
U.S. GAAP and International Financial Reporting Standards.
ASU 2011-04 changes certain fair value measurement principles
and enhances the disclosure requirements for level 3 fair
value measurements. ASU 2011-04 is effective for us in our
first quarter of fiscal 2012 and should be applied
prospectively. Our adoption of ASU 2011-04 became effective
the first quarter of fiscal 2012 and had no material impact
on our financial statements.</font>
</div><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
June 2011, the FASB issued ASU No. 2011-05, <font style="DISPLAY: inline; FONT-STYLE: italic">Comprehensive
Income (Topic 220)—Presentation of Comprehensive
Income,</font> to require an entity to present the total of
comprehensive income, the components of net income, and the
components of other comprehensive income either in a single
continuous statement of comprehensive income or in two
separate but consecutive statements. ASU 2011-05 eliminates
the option to present the components of other comprehensive
income as part of the statement of equity. ASU 2011-05 is
effective for us beginning after December 15, 2012 and should
be applied retrospectively.</font>
</div><br/><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
September 2011, the FASB issued ASU No. 2011-08, <font style="DISPLAY: inline; FONT-STYLE: italic">Intangibles-Goodwill
and Other (Topic 350)—Testing Goodwill for
Impairment,</font> which is intended to simplify how entities
test for goodwill impairment  by permitting an
entity the option of performing a qualitative assessment to
determine whether further impairment testing is necessary.
The standard will be effective for annual and interim
goodwill impairments tests for fiscal years beginning after
December 15, 2011. Our adoption of ASU 2011-08 became
effective the first quarter of fiscal 2012 and had no
material impact on our financial statements.</font>
</div><br/>