EQUITY

12 Months Ended

Dec. 31, 2011

Equity [Abstract]

Stockholders' Equity Note Disclosure [Text Block]

EQUITY

(a) General

At the annual meeting of stockholders on June 10, 2010, the Company’s stockholders approved an amendment to its Certificate of Incorporation to increase the number of authorized shares of capital stock from 20,000,000 shares to 30,000,000 shares, all of which shall be Common Stock. The increase in authorized shares was done pursuant to a Certificate of Amendment to the Certificate of Incorporation filed with the Secretary of State of the State of Delaware on, and effective as of, June 15, 2010.

At December 31, 2011 the Company had issued and outstanding 17,523,609 shares of its common stock, par value $0.01 per share. Holders of outstanding common stock are entitled to receive dividends when, as and if declared by the Board and to share ratably in the assets of the Company legally available for distribution in the event of a liquidation, dissolution or winding up of the Company. Holders of common stock do not have subscription, redemption, conversion or other preemptive rights. Holders of the common stock are entitled to elect all of the Directors on the Company’s Board.  Holders of the common stock do not have cumulative voting rights, meaning that the holders of more than 50% of the common stock can elect all of the Company’s Directors.  Except as otherwise required by Delaware General Corporation Law, all stockholder action is taken by vote of a majority of shares of common stock present at a meeting of stockholders at which a quorum (a majority of the issued and outstanding shares of common stock) is present in person or by proxy or by written consent pursuant to Delaware law (other than the election of Directors, who are elected by a plurality vote).

  The Company is not authorized to issue preferred stock.  Accordingly, no preferred stock is issued or outstanding.

(b)Dividends

On October 17, 2011, the Board of Directors of the Company approved the payment of a quarterly dividend of $0.035 per share and a 2011 year-end declaration of a special dividend of $0.05 per share.

The quarterly dividend was paid on November 28, 2011 ($614) to common shareholders of record on November 16, 2011. The special year-end dividend ($876) was paid on January 9, 2012 to stockholders of record on December 30, 2011. The special year-end dividend is reflected in the Company's year end Consolidated Balance Sheet in Other Current Liabilities (see Note 15). (See Note 26 - Subsequent Events.)

(c) Capital Raise

(i)           March 2010 Capital Raise

On March 8, 2010, the Company completed a registered direct offering through a placement agent of 2,231,818 shares of its common stock pursuant to separate subscription agreements between the Company and each of the investors at $5.50 per share to certain accredited investors for gross proceeds of approximately $12,275. The aggregate net proceeds from the offering, after deducting the placement agent’s fee and the offering expenses payable by the Company in connection with the offering, was $11,467.

(ii)           December 2010 Capital Raise

On December 17, 2010, the Company entered into a Placement Agent Agreement (the “Placement Agent Agreement”) related to a registered direct offering of up to 1,150,000 shares of its common stock.  Under the terms of the transaction and pursuant to separate subscription agreements between the Company and each of the investors, the Company sold the common stock at $3.50 per share for gross proceeds of $4,027.  The Placement Agent Agreement provided for the payment of a placement agent fee equal to 7% ($282) of the gross proceeds of the offering, plus a warrant exercisable for an additional 80,500 shares (see Note 18(i)). The aggregate net proceeds from the offering, after deducting the placement agent’s fee and expenses in connection with the offering, was $3,709.

(d) Summary Employee Option Information

The Company’s stock option plans provide for the grant to officers, directors and other key employees of options to purchase shares of common stock.  The purchase price may be paid in cash or at the end of the option term, if the option is "in-the-money", it is automatically exercised "net" . In a net exercise of an option, the Company does not require a payment of the exercise price of the option from the optionee, but reduces the number of shares of common stock issued upon the exercise of the option by the smallest number of whole shares that has an aggregate fair market value equal to or in excess of the aggregate exercise price for the option shares covered by the option exercised.  Each option is exercisable to one share of the Company’s common stock.  Most options expire within five to ten years from the date of the grant, and generally vest over three year period from the date of the grant. At December 31, 2011, 876,334 options were available for grant under the 2006 Amended and Restated  Stock Incentive Plan and 76,667 options were available for grant under the 2006 Director Plan. In 2009, 2010 and 2011, all options granted to non-employees were from the 2006 Amended and Restated Stock Incentive Plan which permits grants to non-employees.

In connection with the stock option exercises during the years ended December 31, 2009, 2010 and 2011, the Company received proceeds of $273, $159 and $211, respectively.  During the years ended December 31, 2009, 2010 and 2011, all 257,168, 67,500 and 231,831 shares issued in connection with option exercises were newly issued shares. The intrinsic value of options exercised in 2009, 2010 and 2011 were $1,592, $247 and $707, respectively. The intrinsic value of options outstanding and options exercisable at December 31, 2011 was $2,631 and $2,513, respectively.

During 2011, 148,165 options were exercised and 304,167 options were forfeited in connection with the “net exercise” of 452,332 options. The 452,332 options which were exercised under this method had a weighted average exercise price exercise price of $2.69. In addition, during 2011, 83,666 options were exercised for cash. Such options had a weighted average exercise price exercise price of $2.51.

Of the 359,500, 235,000 and 141,666 options the Company granted to employees in the years ended December 31, 2009, 2010 and 2011, respectively, 300,000, 95,000 and 141,666 options were granted to employees who were related parties (directors and executive officers) under various option plans.  During 2009, 224,668 options were exercised by related parties and 46,667 options were forfeited. During 2010, 67,500 options were exercised by related parties and 120,000 options were forfeited. During 2011, 159,779 options were exercised by related parties and 351,221 options were forfeited. As of December 31, 2009, 2010 and 2011, the number of outstanding options held by the related parties was 1,547,165, 1,574,665 and 1,199,999 options, respectively.

The weighted average grant-date fair value of the options granted during 2009 , 2010 and 2011, amounted to $1.47, $3.47 and $2.17 per option, respectively. The Company utilized the Black-Scholes option-pricing model to estimate fair value, utilizing the following assumptions for the respective years (all in weighted averages):

	2009		2010		2011
Risk-free interest rate	2.1	%	2.8	%	1.8	%
Expected term of options, in years	5.7		6.3		5.5
Expected annual volatility	70	%	68	%	62	%
Expected dividend yield	None		None		1.8	%

The expected term of the options is the length of time until the expected date of exercising the options.  With respect to determining expected exercise behavior, the Company has grouped its option grants into certain groups in order to track exercise behavior and establish historical rates.  The Company estimated volatility by considering historical stock volatility over the expected term of the option.  The risk-free interest rates are based on the U.S. Treasury yields for a period consistent with the expected term.  Up to October 17, 2011, the Company expected no dividends to be paid.  On October 17, 2011, the Company approved the payment of a quarterly dividend of $0.035 per share and a 2011 year-end declaration of a special dividend of $0.05 per share (see Note 18(b)). The expected dividend yield for 2011 takes into account a quarterly dividend of $0.035 per share on options grants from that date. The Company believes that the valuation technique and the approach utilized to develop the underlying assumptions are appropriate in determining the estimated fair value of the Company’s stock options granted in the years ended December 31, 2009, 2010 and 2011.  Estimates of fair value are not intended to predict actual future events or the value ultimately realized by persons who receive equity awards.

(e) Non-Employee Options

On October 4, 2011, the Company granted an outside consultant an option for the purchase of 25,000 shares of the Company’s common stock.  The options vest over 90 days, have an exercise price of $5.30 and expire after seven years. The Company used the Black-Scholes valuation method to estimate the fair value of the options granted to the consultant.  The Company used a risk free interest rate of 1.3%, an expected life of seven years, an annual volatility of 62% and no expected dividends to determine the value the options granted.  The Company estimated the fair value of each option granted to be $3.23. The Company recorded $79 to selling, general and administrative expense with respect to the option granted to the consultant in the year ended December 31, 2011.

In January 2010, the Company granted an outside consultant an option for the purchase of 25,000 shares of the Company’s common stock.  The options vested after twelve months, have an exercise price of $7.38 and expire after seven years. The Company used the Black-Scholes valuation method to estimate the fair value of the options granted to the consultant.  The Company used a risk free interest rate of 3.4%, an expected life of seven years, an annual volatility of 69% and no expected dividends to determine the value the options granted.  The Company estimated the fair value of each option granted to be $5.01. The Company recorded $124 and $1 to selling, general and administrative expense with respect to the option granted to the consultant in the year ended December 31, 2010 and 2011, respectively.

In June 2009, the Company granted several outside consultants options for the purchase of a total of 20,000 shares of the Company’s common stock.  The options vested over a period of three years, have an exercise price of $2.56 and expire after seven years.  The Company used the Black-Scholes valuation method to estimate the fair value of the options granted to the consultants.  The Company used a risk free interest rate of 3.3%, an expected life of seven years, an annual volatility of 75% and no expected dividends to determine the value the options granted.  The Company estimated the fair value of each option granted to be $1.83. The Company recorded $13 , $15 and $7 to selling, general and administrative expense with respect to the option granted to the outside consultants in the years ended December 31, 2009, 2010 and 2011, respectively.

In the years ended December 31, 2009, 2010 and 2011, the Company included $13, $139 and $87 respectively, of stock-based compensation expense in selling, general and administrative expense in its Consolidated Statements of Operations with respect to options granted to non-employees.

(f) Summary Employee and Non-Employee Option Information

A summary of the Company’s option plans as of December 31, 2009, 2010 and 2011, as well as changes during each of the years then ended, is presented below:

	2009				2010				2011
	Number  of Options (in shares)		Weighted Average Exercise Price		Number of Options (in shares)		Weighted Average Exercise Price		Number of Options (in shares)		Weighted Average Exercise Price
Outstanding at beginning of year	1,876,500		$	3.27	1,745,165		$	3.52	1,817,665		$	3.69
Granted at market price	379,500		$	2.52	260,000		$	5.58	166,666		$	4.63
Exercised	(257,168	)	$	1.06	(67,500	)	$	2.36	(231,831	)	$	2.62
Forfeited or expired	(253,667	)	$	2.65	(120,000	)	$	6.13	(364,167	)	$	3.00
Outstanding at end of year	1,745,165		$	3.52	1,817,665		$	3.69	1,388,333		$	4.17
Exercisable at end of year	1,421,831		$	3.52	1,572,455		$	3.62	1,267,915		$	4.08

Summary information regarding the options outstanding and exercisable at December 31, 2011 is as follows:

	Outstanding				Exercisable
Range of Exercise Prices	Number Outstanding	Weighted Average Remaining Contractual Life	Weighted Average Exercise Price		Number Exercisable	Weighted Average Exercise Price
	(in shares)	(in years)			(in shares)
$1.61 – 2.56	285,834	4.55	$	2.10	277,916	$	2.08
$2.96 – 3.90	316,666	2.15	$	3.48	316,666	$	3.48
$4.09 – 4.96	238,333	3.71	$	4.54	213,333	$	4.50
$5.00 – 6.00	522,500	4.48	$	5.39	435,000	$	5.41
$7.38	25,000	5.01	$	7.38	25,000	7.38
	1,388,333				1,267,915

Stock-based compensation expense included in the Company’s Statements of Operations was:

	Year ended December 31,
	2009		2010		2011
Cost of sales	$	2	$	—	$	—
Selling, general and administrative expense*	676		690		458
Total stock based compensation expense	$	678	$	690	$	458

* Stock compensation expense in 2011, includes $51 with respect to stock granted to a consultant for the year ended December 31, 2011.

In addition to the above amounts, the Company recorded stock compensation expense of $234 and $339 which is including in Loss from discontinued operations, net of income taxes with respect to Coreworx with respect to the year ended December 31, 2009 and period ending December 17, 2010, respectively. The Company also recorded stock compensation expense of $513, $440 and $176 with respect to CoaLogix operations in the years ended December 31, 2009 and 2010, and the period ended August 31, 2011, respectively which are also included in the Loss from discontinued operations, net of income taxes.

As at December 31, 2011, the total compensation cost related to non-vested awards not yet recognized was approximately $160 which the Company expects to recognize over a weighted-average period of approximately 1.1 years.

(g) DSIT Stock Option Plan

In November 2006, the Company adopted a Key Employee Stock Option Plan (the “DSIT Plan”) for its DSIT subsidiary to be administrated by a committee of board members of DSIT, currently comprised of the entire board of directors of DSIT. The purpose of the DSIT Plan and associated grants is to provide incentives to key employees of DSIT to further the growth, development and financial success of DSIT.

A summary status of the DSIT Plan as of December 31, 2009, 2010 and 2011, as well as changes during the years then ended, is presented below (the table below has been adjusted to reflect a 100:1 stock split in 2011) :

	2009			2010			2011
	Number of Options (in shares)	Weighted Average Exercise Price		Number of Options (in shares)	Weighted Average Exercise Price		Number of Options (in shares)		Weighted Average Exercise Price
Outstanding at beginning of year	152,400	$	1.18	152,400	$	1.18	152,400		$	1.18
Granted at fair value	—	—		—	—		93,054		$	2.45
Exercised	—	—		—	—		—		—
Forfeited	—	—		—	—		(4,630	)	$	1.09
Outstanding at end of year	152,400	$	1.18	152,400	$	1.18	240,824		1.67
Exercisable at end of year*	—	—		—	—		—		—

* Options vest only upon an exit event for the Company.

On August 10, 2011, DSIT granted options to purchase 93,054 of its ordinary shares to senior management and employees of DSIT at an exercise price of NIS 9.38 ($2.67 at the then exchange rate) per share and exercisable for a period of seven years. These options vest and become exercisable only upon the occurrence of an initial public offering of DSIT or a merger, acquisition, reorganization, consolidation or similar transaction involving DSIT. In addition, DSIT also extended the expiration date of 147,770 previously granted options from December 31, 2013 to August 10, 2018. No other option terms were modified.

Summary information regarding the options under the Plan outstanding and exercisable at December 31, 2011 is as follows:

	Outstanding				Exercisable
Range of Exercise Prices	Number Outstanding	Weighted Average Remaining Contractual Life	Weighted Average Exercise Price		Number Exercisable	Weighted Average Exercise Price
	(in shares)	(in years)			(in shares)
$1.05 – $1.26	147,770	7.6	$	1.18	—	—
$2.45	93,054	7.6	$	2.45	—	—
	240,824		$	1.68	—	—

If all the options in the DSIT Plan are exercised, the Company’s holdings in DSIT will be diluted from 84% to approximately 71.4%.

(h) DSIT Warrants

As part of the Company’s August 2005 sale of its 68% owned dsIT Technologies subsidiary and its associated outsourcing consulting business, the Company issued to the purchaser a warrant to purchase 10% of DSIT for $200. Such warrant expires in August 2012.

(i) Warrants

The Company has issued warrants at exercise prices equal to or greater than market value of the Company’s common stock at the date of issuance.  A summary of warrant activity follows:

	2009				2010				2011
	Number  of shares underlying warrants		Weighted Average Exercise Price		Number of shares underlying warrants		Weighted Average Exercise Price		Number of shares underlying warrants	Weighted Average Exercise Price
Outstanding at beginning of year	784,023		$	4.06	246,904		$	4.50	313,806	$	4.29
Granted	—		—		80,500		$	3.68	—	—
Exercised	(537,119	)	$	3.85	(13,598	)	$	4.50	—	—
Forfeited or expired	—		—		—		—		—	—
Outstanding  and exercisable at end of year	246,904		$	4.50	313,806		$	4.29	313,806	$	4.29

Summary information regarding the warrants is as follows:

Exercise Price	Warrants Outstanding	Weighted Average Remaining Contractual Life
	(in shares)	(in years)
$3.68	80,500	4.0
$4.50	233,306	0.3

The 80,500 warrants that were granted in connection with the December 2010 Capital Raise (see Note 18(c)) are exercisable for shares of the Company’s Common Stock for five years at an exercise price of $3.68 per share. The Company allocated $153 to the value of the warrants based on a Black Scholes calculation using a five year expected life, an annual volatility of 59%, a discount rate of 2.0% and no dividends. The value allocated to the warrants was offset against additional paid-in-capital.

The warrants with an exercise price of $4.50 are subject to call for cancellation at the option of the Company on 20 business days notice, upon the common stock having achieved a volume weighted average price of $6.00 or more for 20 consecutive trading days.

During the years ended December 31, 2009 and 2010, the Company received proceeds of $2,069 and $61, respectively, from the exercise of warrants. No warrants were exercised in 2011.

(j) Stock Repurchase Program

In October, 2008, the Company’s Board of Directors authorized a share repurchase program of up to 1,000,000 shares of its common stock. The share repurchase program will be implemented at management’s discretion from time to time. During 2009, the Company acquired 433,795 shares of its common stock for $1,108.

As indicated in Note 4(b), the Company used 473,161 of its treasury shares to acquire shares of USSI. The treasury shares had a basis of $1,791 and a value of $2,229 on the date of the transfer. In accordance with generally accepted accounting principles, the Company recorded an adjustment of $438 to additional paid-in-capital as a result of the transfer of the treasury shares. As at December 31, 2010 and 2011, the Company owned a total of 801,920 of its own shares.