Strange Array Issue when using Object Offset

I’m having an issue with using the Array Modifier when I select the Object Offset option. My Goal is to create an aperture.
This is before I select Object Offset:

This is after I select Object Offset:

Does anyone have any ideas of what I’m doing wrong? I’m using blender 2.65, if there’s any other information that could help to solve my problem please let me know.

Added the .blend file.
CircularDoorFrame2.blend (459 KB)

Where is your blend file ? You have forgotten to attach it to the post or added a link to it.
ALWAYS, ALWAYS DO SO IN THE FUTURE FOR SUPPORT QUESTIONS. Otherwise your just making it more difficult for other users to be able to help you. Your screenshot misses out masses of useful info.