Share-based Compensation

3 Months Ended

Sep. 30, 2011

Share-based Compensation {1}

Share-based Compensation

Share-based compensation expense has been allocated as follows:

	Three months ended		Nine months ended
	September 30, 2011	September 30, 2010	September 30, 2011	September 30, 2010
Cost of goods sold	$                 -	$                 -	$                 -	$                 -
Sales and marketing	4	7	14	31
Research and development	4	8	12	22
General and administrative	40	47	105	169
	$              48	$              62	$            131	$            222

As of September 30, 2011 the total remaining unrecognized compensation cost related to non-vested stock options, net of forfeitures, was approximately $­­­­447.

During the three and nine months ended September 30, 2011, we granted 96,611 and 101,611 stock options respectively. During the three and nine months ended September 30, 2010 we granted 10,500 and 152,250 stock options, respectively.  We use judgment in determining the fair value of the share-based payments on the date of grant using an option-pricing model with assumptions regarding a number of highly complex and subjective variables.  These variables include the risk-free interest rate of the awards, the expected life of the awards, the expected volatility over the term of the awards, the expected dividends of the awards, and an estimate of the amount of awards that are expected to be forfeited.  We use the Black-Scholes option pricing model to determine the fair value of share-based payments granted under ASC Topic 718.