Note 4 - Accounting For Stock-Based Compensation

9 Months Ended

Sep. 30, 2012

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

NOTE 4:-     ACCOUNTING FOR STOCK-BASED COMPENSATION

a. Stock option plans:

1. Under the Company's stock option plans, options may be granted to employees, officers, consultants, service providers and directors of the Company or its subsidiary.

2. As of September 30, 2012, the Company has authorized, by way of three Incentive Share Option Plans, the grant of options to officers, management, other key employees and others of up to 513,000, 240,000 and 1,519,000 shares, respectively, of the Company's common stock. As of September 30, 2012, options to purchase up to an aggregate of 410,145 shares of the Company's common stock are still available for future grant.

3. The options granted generally become fully exercisable after four years and expire no later than 10 years from the date of the option grant. Any options that are forfeited or cancelled before expiration become available for future grants.

	Nine months ended September 30, 2012
	Amount of options		Weighted average exercise price		Weighted average remaining contractual term (years)		Aggregate intrinsic value (*)
Outstanding at the beginning of the period		792,763	$	1.33		6.88	$	411
Outstanding at the end of the period		792,763	$	1.33		6.13	$	81
Exercisable options at the end of the period		488,513	$	1.20		4.82	$	78

(*) Calculation of aggregate intrinsic value is based on the share price of the Company's common stock as of September 30, 2012 ($ 1.35 per share).

a. Stock option plans (cont.):

4. Under the provisions of ASC 718, the fair value of each option is estimated on the date of grant using a Black-Sholes option valuation model that uses the assumptions such as stock price on the date of the grant, exercise price, risk-free interest rate, expected volatility, expected life and expected dividend yield of the option. Expected volatility is based exclusively on historical volatility of the entity's stock as allowed by ASC 718. The Company uses historical information with respect to the employee options exercised to estimate the expected term of options granted, representing the period of time that options granted are expected to be outstanding. The risk-free interest rate of period within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. No options were granted during the first nine month of 2012. The fair value for options granted in the three and nine months ended September 30, 2011 is amortized over their vesting period using a straight-line recognition method and estimated at the date of grant with the following assumptions:

	Three months ended September 30, 2011	Nine months ended September 30, 2011
	Unaudited	Unaudited
Dividend yield	0%	0%
Expected volatility	83%	83%
Risk-free interest rate	1.19%	1.73%
Expected life (in years)	6.25	6.25

The total employee's equity-based compensation expense related to all of the Company's equity-based awards, recognized for the nine months and three months ended September 30, 2012 is comprised as follows:

	Nine months ended				Three months ended
	September 30, 2012		September 30, 2011		September 30, 2012		September 30, 2011
	Unaudited		Unaudited		Unaudited		Unaudited
Sales and marketing  expenses		5		8		2		0
General and administrative		96		49		38		(13)
Total employees equity-based compensation expense		101		57		40		(13)

The weighted-average grant-date fair value of options granted during the first nine months of 2011 was $1.16.

As of September 30, 2012, there was $ 297 of total unrecognized compensation cost related to unvested share-based compensation arrangements granted under the stock option plans. That cost is expected to be recognized over a period of the next 35 months.

b. Employee Stock Ownership Plan: The Company has an Employee Stock Ownership Plan ("ESOP") covering eligible employees. The ESOP provides for the Employee Stock Ownership Trust ("ESOT") to distribute shares of the Company's Common shares as retirement benefits to the participants. The Company has not distributed shares since 1998. As of September 30, 2012, the ESOT held 167,504 shares of common stock.