On June 5, 2006, 1,500,000 options were granted to the chief executive officer of the Company resulting in non-cash compensation expense amounting to approximately $1,527,000. On October 23, 2006, 230,000 options were granted to employees resulting in non-cash compensation expense of approximately $184,000. On February 9, 2007, 1,070,000 options were granted to employees and directors resulting in non-cash compensation expense of approximately $584,000. Additional non-cash compensation for the nine months ended February 28, 2007 amounted to $61,000 for vesting of employee stock options in accordance with SFAS No 123(R).

Payments of Board of Director fees increased by approximately $67,000 for the three months ended February 28, 2007 as compared to the three months ended February 28, 2006 due to the initiation of monthly director payments in the third quarter of fiscal 2006.