(7) STOCK OPTIONS

9 Months Ended

Sep. 30, 2011

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

(7) STOCK OPTIONS

On May 11, 2011, the Company issued five-year options to various employees to purchase up to 9,000 shares of the Company’s common stock at an exercise price of $11.91 per share.  The options will be fully vested in May 2012 and expire in May 2016

Total share-based compensation expense recognized in the Statement of Operations aggregated $3,893 for the three months ended September 30, 2011 and $0 for the same period in 2010.  The total share-based compensation expense for the nine months ended September 30, 2011 was $5,839 versus $0 for the same period in 2010.

To calculate the option-based compensation, the Company used the Black-Scholes option-pricing model. The Company’s determination of fair value of option-based awards on the date of grant using the Black-Scholes model is affected by the Company’s stock price as well as assumptions regarding a number of subjective variables. These variables include, but are not limited to, the Company’s expected stock price volatility over the term of the awards, risk-free interest rate, and the expected life of the options. The risk-free interest rate is based on a treasury instrument whose term is consistent with the expected life of the stock options. The expected volatility, holding period, and forfeitures of options are based on historical experience.