FAIR VALUE MEASUREMENTS AND FINANCIAL INSTRUMENTS (Tables)

3 Months Ended

Mar. 31, 2013

Fair Value Measurements and Financial Instruments [Abstract]

Assets and Liabilities Measured at Fair Value on Recurring Basis Using Significant Observable Inputs (Level 2)

Assets and liabilities measured at fair value on a recurring basis using significant observable inputs (Level 2) from January 1, 2013 to March 31, 2013 are summarized as follows:

	Warrant liability (Level 2)
Balance at January 1, 2013	$	354,000
Change in fair value included in earnings		108,000
Exercise of warrants		-
Balance at March 31, 2013	$	462,000

Fair Value of Warrants Using Black-Scholes Option Pricing Model

The Company estimates the fair value of its warrants as of March 31, 2013 and December 31, 2012 using the Black-Scholes option pricing model using the following assumptions:

	March 31, 2013			December 31, 2012
Series A and B Warrants
Market price of common stock:	$	5.120		$	4.390
Exercise price:		3.50			3.50
Remaining contractual life (years):		0.58			0.83
Dividend yield:		-			-
Expected volatility:		36.40	%		51.41	%
Risk-free interest rate:		0.10	%		0.13	%
Fair value – Series A and B Warrants	$	423,000		$	319,000
Underwriter Warrants
Market price of common stock:	$	5.120		$	4.390
Exercise price:		4.80			4.80
Remaining contractual life (years):		1.43			1.68
Dividend yield:		-			-
Expected volatility:		51.23	%		61.26	%
Risk-free interest rate:		0.17	%		0.21	%
Fair value – Underwriter Warrants	$	39,000		$	35,000
Fair value – Total	$	462,000		$	354,000