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SHAREHOLDERS' EQUITY | 12 Months Ended
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Dec. 31, 2012
SHAREHOLDERS' EQUITY [Abstract] |
SHAREHOLDERS' EQUITY | NOTE 8 - SHAREHOLDERS' EQUITY
| A. | Rights of Shares:
Holders of ordinary shares are entitled to participate equally in the payment of cash dividends and bonus shares (stock dividends) and, in the event of the liquidation of the Company, in the distribution of assets after satisfaction of liabilities to creditors. Each ordinary share is entitled to one vote on all matters to be voted on by shareholders.
| B. | Share Purchase Agreement:
On February 28, 2007, the Company entered into Share Purchase Agreement with four investors for the private placement of 1,937,983 ordinary shares of the Company, at a price of $2.58 per share, for gross proceeds of $5,000. As part of the transaction, the Company issued warrants to the investors for the purchase of 1,453,485 additional ordinary shares at an exercise price of $3.05 per share. On March 13, 2007, the shares were issued and the proceeds from the private placement were received. 872,092 warrants were exercised and converted into 336,134 shares by one investor in March, 2010. 581,393 warrants were exercised and converted into 581,393 shares by another investor during January 2011.
| C. | Employee Incentive Plans:
The Company's Board of directors approves, from time to time, employee incentive plans, the last of which was approved in October 2007. Employee incentive plans include stock options, restricted stock units and restricted stock awards. Stock Options The following table summarizes the effects of stock-based compensation resulting from the application of ASC 718 included in the Statements of Operations as follows:
|  | Year ended December 31, |
|  | 2 0 1 2 |  |  | 2 0 1 1 |  |  | 2 0 1 0 |
Cost of Revenues: |  |  |  |  |  |  |  |  |
Products |  | $ | 305 |  |  | $ | 202 |  |  | $ | 97 |
Services |  |  | 106 |  |  |  | 91 |  |  |  | 35 |
Research and Development expenses |  |  | 921 |  |  |  | 601 |  |  |  | 313 |
Sales and Marketing expenses |  |  | 497 |  |  |  | 470 |  |  |  | 141 |
General and Administration expenses |  |  | 96 |  |  |  | 71 |  |  |  | 124 |
Total |  | $ | 1,925 |  |  | $ | 1,435 |  |  | $ | 710 |
Stock options usually vest over four years and their term may not exceed 10 years. The exercise price of each option is usually the market price of the underlying share at the date of each grant. Through December 31, 2012, 9,958,551 share options have been issued under the plans, of which 3,834,167 options have been exercised, 4,280,037 options have been cancelled, and 867,134 options were exercisable as of December 31, 2012. The weighted average fair value (in dollars) of the options granted during 2012, 2011and 2010, according to Black-Scholes option-pricing model, amounted to $5.32, $5.94 and $4.06 per option, respectively. Fair value was determined on the basis of the price of the Company's share. Summary of the status of the Company's share option plans as of December 31, 2012, 2011 and 2010, as well as changes during each of the years then ended, is presented below:
|  | 2 0 1 2 |  |  | 2 0 1 1 |  |  | 2 0 1 0 |
|  | Share |  |  | Weighted average exercise |  |  | Share |  |  | Weighted average exercise |  |  | Share |  |  | Weighted average exercise |
|  | options |  |  | price |  |  | options |  |  | Price |  |  | options |  |  | price |
Outstanding - beginning of year |  |  | 1,575,814 |  |  |  | 4.84 |  |  |  | 1,631,072 |  |  | 2.96 |  |  |  | 1,827,862 |  |  |  | 1.99 |
Granted |  |  | 452,494 |  |  |  | 7.98 |  |  |  | 444,237 |  |  | 8.81 |  |  |  | 490,500 |  |  |  | 5.66 |
Exercised |  |  | 131,922 |  |  |  | 2.03 |  |  |  | 436,601 |  |  | 2.12 |  |  |  | 557,407 |  |  |  | 2.45 |
Cancelled |  |  | 52,039 |  |  |  | 7.1 |  |  |  | 62,894 |  |  | 4.05 |  |  |  | 129,883 |  |  |  | 1.73 |
Outstanding - year end |  |  | 1,844,347 |  |  |  | 5.75 |  |  |  | 1,575,814 |  |  | 4.84 |  |  |  | 1,631,072 |  |  |  | 2.96 |
Options exercisable at year-end |  |  | 867,134 |  |  |  | 3.86 |  |  |  | 634,252 |  |  | 2.95 |  |  |  | 697,336 |  |  |  | 2.23 |
The following table summarizes information about share options outstanding as of December 31, 2012:
Outstanding as of |  |  | Exercisable as of |
December 31, 2012 |  |  | December 31, 2012 |
prices Range of exercise |  |  | Number outstanding |  |  | Weighted average remaining contractual life |  |  | Weighted average exercise price |  |  | Number exercisable |  |  | Weighted average exercise price |
(US dollars) |  |  |  |  |  | (in years) |  |  | (US dollars) |  |  |  |  |  | (US dollars) |
0.43-1.79 |  |  |  | 344,407 |  |  | 5.72 |  |  | 1.22 |  |  |  | 284,936 |  |  | 1.23 |
2.86-2.87 |  |  |  | 229,709 |  |  | 1.42 |  |  | 2.86 |  |  |  | 229,709 |  |  | 2.86 |
4.20-4.78 |  |  |  | 133,000 |  |  | 7.46 |  |  | 4.23 |  |  |  | 83,792 |  |  | 4.24 |
5.48-6.70 |  |  |  | 302,567 |  |  | 6.70 |  |  | 6.39 |  |  |  | 163,821 |  |  | 6.36 |
7.40-7.91 |  |  |  | 337,494 |  |  | 6.62 |  |  | 7.81 |  |  |  | 5,208 |  |  | 7.40 |
8.38-8.40 |  |  |  | 390,501 |  |  | 5.86 |  |  | 8.39 |  |  |  | 66,750 |  |  | 8.40 |
10.12-10.83 |  |  |  | 106,669 |  |  | 4.84 |  |  | 10.47 |  |  |  | 32,918 |  |  | 10.41 |
|  |  |  | 1,844,347 |  |  | 5.74 |  |  | 5.75 |  |  |  | 867,134 |  |  | 3.86 |
Unrecognized compensation expense As of December 31, 2012, there was $2,093 of total unrecognized compensation cost related to non-vested employee options and $89 of total unrecognized compensation cost related to non-vested employee RSUs. These costs are generally expected to be recognized over a period of four years. Restricted Share Units Restricted Share Units ("RSU") grants are rights to receive shares of the Company's common stock on a one-for-one basis and vest 25% on each of the first, second, third and fourth anniversaries of the grant date and are not entitled to dividends or voting rights, if any, until they are vested. The fair value of the RSU awards is being recognized on a straight-line basis over vesting period. As of December 31, 2012, 346,619 RSU's, had been issued, 236,224 RSU's had been vested, 3,425 had been cancelled. As of December 31, 2011, 331,451 RSU's, had been issued, 153,812 RSU's had been vested, 1,350 had been cancelled.

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- Definition The entire disclosure for shareholders' equity, comprised of portions attributable to the parent entity and noncontrolling interest, if any, including other comprehensive income (as applicable). Including, but not limited to: (1) balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings; (2) accumulated balance for each classification of other comprehensive income and total amount of comprehensive income; (3) amount and nature of changes in separate accounts, including the number of shares authorized and outstanding, number of shares issued upon exercise and conversion, and for other comprehensive income, the adjustments for reclassifications to net income; (4) rights and privileges of each class of stock authorized; (5) basis of treasury stock, if other than cost, and amounts paid and accounting treatment for treasury stock purchased significantly in excess of market; (6) dividends paid or payable per share and in the aggregate for each class of stock for each period presented; (7) dividend restrictions and accumulated preferred dividends in arrears (in aggregate and per share amount); (8) retained earnings appropriations or restrictions, such as dividend restrictions; (9) impact of change in accounting principle, initial adoption of new accounting principle and correction of an error in previously issued financial statements; (10) shares held in trust for Employee Stock Ownership Plan (ESOP); (11) deferred compensation related to issuance of capital stock; (12) note received for issuance of stock; (13) unamortized discount on shares; (14) description, terms, and number of warrants or rights outstanding; (15) shares under subscription and subscription receivables, effective date of new retained earnings after quasi-reorganization and deficit eliminated by quasi-reorganization and, for a period of at least ten years after the effective date, the point in time from which the new retained dates; and (16) retroactive effective of subsequent change in capital structure. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 04 -Article 3 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21488-112644 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 02 -Paragraph 29, 30, 31 -Article 5 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Staff Accounting Bulletin (SAB) -Number Topic 4 -Section E Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Glossary Preferred Stock -URI http://asc.fasb.org/extlink&oid=6521494 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 11 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21564-112644 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section S99 -Paragraph 4 -Subparagraph (SAB TOPIC 4.C) -URI http://asc.fasb.org/extlink&oid=6959260&loc=d3e187143-122770 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21484-112644 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644 Reference 10: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 6 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21506-112644 Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 30 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6405834&loc=d3e23285-112656 Reference 12: http://www.xbrl.org/2003/role/presentationRef -Publisher AICPA -Name Accounting Research Bulletin (ARB) -Number 43 -Section B -Paragraph 7, 11A -Chapter 1 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. 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