----

----

----

----

| x                                                                    | ANNUAL      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES      EXCHANGE     |
|----------------------------------------------------------------------|----------------------------------------------------------------------------------------|
|                                                                 | ACT      OF 1934                                                                       |
|                                                                 |                                                                                   |
| For      the fiscal year ended: December 31, 2008                    |
| or                                                                   |
|                                                                 |                                                                                   |
| o                                                                    | TRANSITION      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES      EXCHANGE |
|                                                                 | ACT      OF 1934                                                                       |
|                                                                 |                                                                                   |
| For      the transition period from: _____________ to  _____________ |

----

----

| Nevada                                 | 001-28099         | 77-0571784               |
|----------------------------------------|-------------------|--------------------------|
| (State      or Other Jurisdiction      | (Commission       | (I.R.S.      Employer    |
| of      Incorporation or Organization) | File      Number) | Identification      No.) |

----

| Securities      registered pursuant to Section 12(b) of the Act: |
|------------------------------------------------------------------|
|                                                             |   |   |
| Title      of each class                                         |   | Name      of each exchange on which registered |
|                                                             |   |   |
|                                                             |   |   |
| Securities      registered pursuant to Section 12(g) of the Act: |
|                                                             |   |   |
| Common      Stock                                                |
|                                                             | (Title      of Class) |   |

----

| Indicate      by check mark if the registrant is a well-known seasoned issuer, as      defined in Rule 405 of the Securities Act.                                                                                                                                                                                                                                                      |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                        | o |  Yes | x |  No |
|                                                                                                                                                                                                                                                                                                                                                                                        |
| Indicate      by check mark if the registrant is not required to file reports pursuant      to Section 13 or Section 15(d) of the Act.                                                                                                                                                                                                                                                      |
|                                                                                                                                                                                                                                                                                                                                                                                        | o |  Yes | x |  No |
|                                                                                                                                                                                                                                                                                                                                                                                        |
| Indicate      by check mark whether the registrant (1) has filed all reports required to      be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934      during the preceding 12 months (or for such shorter period that the      registrant was                                                                                                                           |
| required      to file such reports), and (2) has been subject to such filing      requirements for the past 90 days.                                                                                                                                                                                                                                                                        | x |  Yes | o |  No |
|                                                                                                                                                                                                                                                                                                                                                                                        |
| Indicate      by check mark if disclosure of delinquent filers pursuant to Item 405 of      Regulation S-K (§229.405 of thischapter)      is not contained herein, and will not be contained, to the best of      registrant’s knowledge, in definitive proxy or                                                                                                                 |
| information      statements incorporated by reference in Part III of this Form 10-K or any      amendment to this                                                                                                                                                                                                                                                                           |
| Form      10-K.                                                                                                                                                                                                                                                                                                                                                                             | x |   |
|                                                                                                                                                                                                                                                                                                                                                                                        |
| Indicate      by check mark whether the registrant is a large accelerated filer, an      accelerated filer, a non-accelerated filer, or a smaller reporting      company.                                                                                                                                                                                                                   |
|                                                                                                                                                                                                                                                                                                                                                                                        |   |
| Large      accelerated filer                                                                                                                                                                                                                                                                                                                                                                | o |   | o | Accelerated      filer | o |   |
| Non-accelerated      filer                                                                                                                                                                                                                                                                                                                                                                  | o |   | o | Smaller      reporting company | x |   |
|                                                                                                                                                                                                                                                                                                                                                                                        |   |
| Indicate      by check mark whether the registrant is a shell company (as defined in      Rule 12b-2 of the Act).                                                                                                                                                                                                                                                                           | x |  Yes | o |  No |
|                                                                                                                                                                                                                                                                                                                                                                                        |   |
| State      the aggregate market value of the voting and non-voting common equity held      by non-affiliates computed by reference to the price at which the common      equity was last sold, or the average bid and asked price of such common      equity, as of the last business day of the registrant’s most recently      completed second fiscal quarter.  $608,507 |
|                                                                                                                                                                                                                                                                                                                                                                                        |
| Indicate      the number of shares outstanding of each of the registrant’s classes of      common stock, as of the latest practicable date. 20,283,573 shares as of      April 10, 2009.                                                                                                                                                                                              |
|                                                                                                                                                                                                                                                                                                                                                                                        |
| APPLICABLE      ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY                                                                                                                                                                                                                                                                                                                                  |
| PROCEEDINGS      DURING THE PRECEDING FIVE YEARS:                                                                                                                                                                                                                                                                                                                                           |
|                                                                                                                                                                                                                                                                                                                                                                                        |
| Indicate      by check mark whether the registrant has filed all documents and reports      required to be filed by Section 12, 13 or 15(d) of the Securities Exchange      Act of 1934 subsequent to the distribution of securities under a plan      confirmed by                                                                                                                         |
| a      court.                                                                                                                                                                                                                                                                                                                                                                               | o | Yes | o | No |
|                                                                                                                                                                                                                                                                                                                                                                                        |
| DOCUMENTS      INCORPORATED BY REFERENCE                                                                                                                                                                                                                                                                                                                                                    |

----

----

----

|                 |   |                                                                                                                         |   | Page   |
|----------------------|--------|------------------------------------------------------------------------------------------------------------------------------|--------|--------|
| PART      I          |   |                                                                                                                         |   |   |
|                 |   |                                                                                                                         |   |   |
| Item      1.         |   | Business                                                                                                                     |   | 4      |
| Item      1A.        |   | Risk      Factors                                                                                                            |   | 6      |
| Item      1B.        |   | Unresolved      Staff Comments                                                                                               |   | 6      |
| Item      2.         |   | Properties                                                                                                                   |   | 6      |
| Item      3.         |   | Legal      Proceedings                                                                                                       |   | 6      |
| Item      4.         |   | Submission      of Matters to a Vote of Security Holders                                                                     |   | 6      |
|                 |   |                                                                                                                         |   |   |
| PART      II         |   |                                                                                                                         |   |   |
|                 |   |                                                                                                                         |   |   |
| Item      5.         |   | Market      for Registrant’s Common Equity, Related Stockholder Matters and Issuer      Purchases of Equity Securities |   | 7      |
| Item      6.         |   | Selected      Financial Data                                                                                                 |   | 7      |
| Item      7.         |   | Management’s      Discussion and Analysis of Financial Condition and Results of      Operations                        |   | 7      |
| Item      7A.        |   | Quantitative      and Qualitative Disclosures about Market Risk                                                              |   | 9      |
| Item      8.         |   | Financial      Statements and Supplementary Data                                                                             |   |        |
| Item      9.         |   | Changes      in and Disagreements With Accountants on Accounting and Financial      Disclosures                              |   | 10     |
| Item      9A(T).     |   | Controls      and Procedures                                                                                                 |   | 10     |
| Item      9B         |   | Other      Information                                                                                                       |   | 11     |
| PART      III        |   |                                                                                                                         |   |   |
|                 |   |                                                                                                                         |   |   |
| Item      10.   |   | Directors,      Executive Officers and Corporate Governance                                                                  |   | 12     |
| Item      11.        |   | Executive      Compensation                                                                                                  |   | 13     |
| Item      12.        |   |    Security      Ownership of Certain Beneficial Owners and Management and Related      Stockholder Matters   |   | 13     |
| Item      13.        |   | Certain      Relationships and Related Transactions, and Director      Independence                                          |   | 14     |
| Item      14.        |   | Principal      Accounting Fees and Services.                                                                                 |   | 14     |
| Item      15.        |   | Exhibits,      Financial Statement Schedules                                                                                 |   | 14     |
| SIGNATURES           |   |                                                                                                                         |   |   |

----

| Item      1. | Business. |
|--------------|-----------|

----

|   | · | Potential      for growth and profitability, indicated by new technology, anticipated      market expansion, or new products; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------|

|   | · | Our      perception of how any particular business opportunity will be received by      the investment community and by our  stockholders; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Whether,      following the business combination, the financial condition of the      business opportunity would be, or would have a significant prospect in the      foreseeable future of becoming sufficient to enable our securities to      qualify for listing on a exchange or on a national automated securities      quotation system, such as the stockmarket. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Capital      requirements and anticipated availability of required funds, to be      provided by us or from operations, through the sale of additional      securities, through joint ventures or similar arrangements, or from other      sources; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | The      extent to which the business opportunity can be  advanced; |
|--------|--------|---------------------------------------------------------------------|

|   | · | Competitive      position as compared to other companies of similar size and experience      within the industry segment as well as within the industry as a      whole; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Strength      and diversity of existing management, or management prospect that are      scheduled for recruitment; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------|

|   | · | The      cost of our participation as compared to the perceived tangible and      intangible values and potential;and |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------|

|   | · | The      accessibility of required management expertise, personnel, raw materials,      services, professional assistance, and other required    items. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Item      1A. | Risk      Factors. |
|---------------|--------------------|

| Item      1B. | Unresolved      Staff Comments. |
|---------------|---------------------------------|

| Item      2. | Properties. |
|--------------|-------------|

| Item      3. | Legal      Proceedings. |
|--------------|-------------------------|

| Item      4. | Submission      of Matters to a Vote of SecurityHolders. |
|--------------|----------------------------------------------------------|

----

| Item      5. | Market      for Registrant’s Common Equity, Related Stockholder Matters and Issuer      Purchases of Equity Securities. |
|--------------|-------------------------------------------------------------------------------------------------------------------------------|

| Common      Stock         |   | High   |   |   | Low    |   |
|---------------------------|--------|--------|--------|--------|--------|--------|
| 2008                      |   |   |   |   |   |   |
| First      Quarter        |   | $      | 0.145  |   |   | $      | 0.07 |   |
| Second      Quarter       |   | $      | 0.25   |   |   | $      | 0.55 |   |
| Third      Quarter   |   | $      | 0.13   |   |   | $      | 0.05 |   |
| Fourth      Quarter       |   | $      | 0.10   |   |   | $      | 0.01 |   |
|                      |   |   |   |   |   |   |   |   |
| 2007                      |   |   |   |   |   |   |   |   |
| First      Quarter        |   | $      | 0.18   |   |   | $      | 0.09 |   |
| Second      Quarter       |   | $      | 0.11   |   |   | $      | 0.066 |   |
| Third      Quarter   |   | $      | 0.12   |   |   | $      | 0.085 |   |
| Fourth      Quarter       |   | $      | 0.11   |   |   | $      | 0.041 |   |

| Item      6. | Selected      Financial Data. |
|--------------|-------------------------------|

| Item      7. | Management’s      Discussion and Analysis of Financial Condition and Results of      Operation. |
|--------------|-------------------------------------------------------------------------------------------------------|

----

----

| Item 7A. | Quantitative      and Qualitative Disclosures About MarketRisk. |
|----------|-----------------------------------------------------------------|

| Item 8. | Financial      Statements and SupplementaryData.  |
|---------|--------------------------------------------------------|

----

| Item 9. | Changes      in and Disagreements With Accountants on Accounting and Financial      Disclosure. |
|---------|-------------------------------------------------------------------------------------------------|

| Item    9A(T) | Controls      and Procedures. |
|---------------|-------------------------------|

|   | a. | The      deficiency was identified as the Company’s limited segregation of duties      amongst the Company’s employees with respect to the Company’s control      activities. This deficiency is the result of the Company’s limited number      of employees. This deficiency may affect management’s ability to determine      if errors or inappropriate actions have taken place.  Management      is required to apply its judgment in evaluating the cost-benefit      relationship of possible changes in our disclosure controls and      procedures. |
|--------|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | b. | The      deficiency was identified with respect to the Company’s Board of      Directors.  This deficiency is the result of the Company’s      limited number of external board members.  This deficiency may      give the impression to the investors that the board is not independent      from management.  Management and the Board of Directors are      required to apply their judgment in evaluating the cost-benefit      relationship of possible changes in the organization of the Board of      Directors. |
|--------|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Item      9B. | Other      Information. |
|---------------|-------------------------|

----

| Item      10. | Directors,      Executive Officers and CorporateGovernance. |
|---------------|-------------------------------------------------------------|

| Name              |   | Age |   | Position(s)                                       |
|-------------------|--------|-----|--------|---------------------------------------------------|
| Paul      Goodman |   | 47  |   | President,      Secretary, Treasurer and Director |

|   | · | any      breach of the director's duty of loyalty to us or our      stockholders, |
|--------|--------|-----------------------------------------------------------------------------------|

|   | · | acts      or omission not in good faith or that involve intentional misconduct or a      knowing violation of law, |
|--------|--------|--------------------------------------------------------------------------------------------------------------------|

|   | · | payments      of dividends or approval of stock repurchases or redemptions that are      prohibited by Delaware law, or |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------|

|   | · | any      transaction from which the director derives an improper personal      benefit. |
|--------|--------|-----------------------------------------------------------------------------------------|

----

| Item      11. | Executive      Compensation. |
|---------------|------------------------------|

| Item      12.  | Security      Ownership of Certain Beneficial Owners and Management and Related      Stockholder Matters. |
|---------------------|-----------------------------------------------------------------------------------------------------------|

| Name      and Address of Beneficial Owners              |   | Number      ofShares ofCommon      Stock(1) |      |   | Percentageof      Class |   |
|---------------------------------------------------------|--------|--------------------------------------------------|-----------|--------|-------------------------|--------|
| Officers and Directors                                  |   |                                             |      |   |                    |   |
|                                                    |   |                                             |      |   |                    |   |
| Paul      Goodman                                       |   |                                             | 80,000    |   |                    |   | * |   |
|                                                    |   |                                             |      |   |                    |   |   |   |
| All      officers and directors as a group (one person) |   |                                             | 80,000    |   |                    |   | * |   |
|                                                    |   |                                             |      |   |                    |   |   |   |
| Baytree      Capital, LLC                               |   |                                             | 6,200,000 | (2)    |                    |   | 30.5 | % |

----

| * - | Less      than 1.0% |
|-----|---------------------|

| (1) | Unless      otherwise indicated, we believe that all persons named in the table have      sole voting and investment power with respect to all securities      beneficially owned by them. Beneficial ownership exists when a person has      either the power to vote or sell our Common Stock.  A person is      deemed to be the beneficial owner of securities that can be acquired by      such person within 60 days whether upon the exercise of options, warrants      or otherwise.   |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Includes      shares of Common Stock held by Michael Gardner. Mr. Gardner is the      managing member of Baytree Capital Associates  LLC. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------|

----

| Item      13. | Certain      Relationships and Related Transactions, and Director      Independence. |
|---------------|--------------------------------------------------------------------------------------|

|   | None |
|--------|------|

| Item      14. | Principal      Accounting Fees and Services. |
|---------------|----------------------------------------------|

| Item      15. | Exhibits,      Financial Statement Schedules. |
|---------------|-----------------------------------------------|

|   | (a) | Documents      filed as part of the report. |
|--------|-----|---------------------------------------------|

|   | (1) | All      Financial Statements |
|--------|-----|-------------------------------|

|   | (2) | Financial      Statements Schedule |
|--------|-----|------------------------------------|

|   | (3) | Exhibits |
|--------|-----|----------|

----

| Exhibit      Number |   | Description                                                                                                                                                                                                            |
|---------------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 3.1                 |   | Articles      of Incorporation of the Registrant.*                                                                                                                                                                     |
|                |   |                                                                                                                                                                                                                   |
| 3.2                 |   | Certificate      of Amendment to the Articles of Incorporation of the      Registrant.*                                                                                                                                |
|                |   |                                                                                                                                                                                                                   |
| 3.3                 |   | By-Laws      of Registrant.*                                                                                                                                                                                           |
|                |   |                                                                                                                                                                                                                   |
| 4.1                 |   | Form      of Common Stock Certificate *                                                                                                                                                                                |
|                |   |                                                                                                                                                                                                                   |
| 10.1                |   | 1999      Stock Option Plan (Incorporated by reference to Exhibit 4.1 to the      Registrant's Registration Statement on Form S-8 (Commission File Number      333-46712) filed with the SEC on September 27,2000).*** |
|                |   |                                                                                                                                                                                                                   |
| 10.2                |   | 2005      Equity Compensation Plan (incorporated by reference to the Company's      definitive proxy statement filed with the SEC on April 5,      2005).***                                                           |
|                |   |                                                                                                                                                                                                                   |
| 10.3                |   | Form      of Option Agreement.***                                                                                                                                                                                      |
|                |   |                                                                                                                                                                                                                   |
| 14                  |   | Code      of Ethics.**                                                                                                                                                                                                 |
|                |   |                                                                                                                                                                                                                   |
| 21.1                |   | Subsidiaries      of Registrant                                                                                                                                                                                        |
|                |   |                                                                                                                                                                                                                   |
| 23.2                |   | Consent      of Brightman Almagor & Co                                                                                                                                                                             |
|                |   |                                                                                                                                                                                                                   |
| 31                  |   | CEO      and CFO certifications required under Section 302 of the Sarbanes-Oxley      Act of 2002                                                                                                                      |
|                |   |                                                                                                                                                                                                                   |
| 32                  |   | CEO      and CFO certifications required under Section 906 of the Sarbanes-Oxley      Act of 2002                                                                                                                      |
|                |   |                                                                                                                                                                                                                   |
| *                   |   | Incorporated      into this Report by reference to the Registrant's Registration Statement      on Form 10 dated November 15, 1999.                                                                                    |
|                |   |                                                                                                                                                                                                                   |
| **                  |   | Incorporated      into this Report by reference to Exhibit 99 to the Registrant's Annual      Report on Form-10KSB filed April 14, 2005.                                                                               |
|                |   |                                                                                                                                                                                                                   |
| ***                 |   | Incorporated      into this Report by reference to the Registrant's Annual Report on      Form-10KSB filed April 12, 2007.                                                                                             |

----

|                    | BAY      ACQUISITION CORP. |                                            |
|-------------------------|----------------------------|-------------------------------------------------|
|                    |                       |                                            |   |
| Date:      May 18, 2009 | By:                        | /s/      Paul Goodman                           |   |
|                    |                       | Paul      Goodman                               |   |
|                    |                       | President      (Principal Executive Officer and |   |
|                    |                       | Principal      Financial Officer)               |   |

| Signature             |   | Title    |   | Date                   |
|-----------------------|--------|----------|--------|------------------------|
|                  |   |     |   |                   |
|                  |   |     |   |                   |
| /s/      Paul Goodman |   | Director |   | May 18,      2009 |
| Paul      Goodman     |   |     |   |                   |

----

|                                                                                       |   | Page   |
|--------------------------------------------------------------------------------------------|--------|--------|
|                                                                                       |   |   |
| Report      of Independent Registered Public Accounting Firms                              |   |   |
|                                                                                       |   |   |
| Financial      Statements:                                                                 |   |   |
|                                                                                       |   |   |
|        Consolidated      Balance Sheets as of December 31, 2008 and 2007              |   | 20     |
|                                                                                       |   |   |
|        Consolidated      Statements of Operations for the years ended                 |   |   |
|        December      31, 2008 and 2007                                                |   | 21     |
|                                                                                       |   |   |
|        Consolidated      Statements of Shareholders’ Equity for the years ended |   |   |
|        December      31, 2008 and 2007                                                |   | 22     |
|                                                                                       |   |   |
|        Consolidated      Statements of Cash Flows for the years ended                 |   |   |
|        December      31, 2008 and 2007                                                |   | 23     |
|                                                                                       |   |   |
|        Notes      to Consolidated Financial Statements                                |   | 24     |

----

----

----

|                                                                                            |   | December      31, |   |   | December      31, |   |
|-------------------------------------------------------------------------------------------------|--------|-------------------|--------|--------|-------------------|--------|
|                                                                                            |   | 2008              |   |   | 2007              |   |
| Assets                                                                                          |   |              |   |   |              |   |
| Current      assets:                                                                            |   |              |   |   |              |   |
|   Cash      and cash equivalents                                                      |   | $                 | 215    |   |              | $      | 154 |   |
|   Short      term deposits                                                            |   |              | -      |   |              |   | 260 |   |
|   Trade      receivables                                                              |   |              | -      |   |              |   | 203 |   |
|   Work      in progress                                                               |   |              | -      |   |              |   | 89 |   |
|   Other      current assets                                                           |   |              | -      |   |              |   | 22 |   |
|                                                                                            |   |              |   |   |              |   |   |   |
|         Total      current assets                       |   |              | 215    |   |              |   | 728 |   |
|                                                                                            |   |              |   |   |              |   |   |   |
| Property      and equipment, net                                                                |   |              | -      |   |              |   | 140 |   |
| Long-term      deposit                                                                          |   |              | -      |   |              |   | 7 |   |
| Severance      pay funds                                                                        |   |              | -      |   |              |   | 241 |   |
|                                                                                            |   |              |   |   |              |   |   |   |
|         Total      assets                               |   | $                 | 215    |   |              | $      | 1,116 |   |
|                                                                                            |   |              |   |   |              |   |   |   |
| Liabilities and Shareholders'      Equity                                                       |   |              |   |   |              |   |   |   |
| Current      liabilities:                                                                       |   |              |   |   |              |   |   |   |
|   Trade      payables                                                                 |   | $                 | 16     |   |              | $      | 341 |   |
|   Other      accounts payable                                                         |   |              | -      |   |              |   | 490 |   |
|   Deferred      revenues                                                              |   |              | -      |   |              |   | 146 |   |
|   Deferred      tax liability                                                         |   |              | -      |   |              |   | 729 |   |
|                                                                                            |   |              |   |   |              |   |   |   |
|         Total      current liabilities                  |   |              | 16     |   |              |   | 1,706 |   |
|                                                                                            |   |              |   |   |              |   |   |   |
| Long-term      loans                                                                            |   |              | -      |   |              |   | 14 |   |
| Accrued      severance pay                                                                      |   |              | -      |   |              |   | 893 |   |
|                                                                                            |   |              |   |   |              |   |   |   |
|         Total      liabilities                          |   |              | 16     |   |              |   | 2,613 |   |
|                                                                                            |   |              |   |   |              |   |   |   |
| Commitments      and contingencies                                                              |   |              |   |   |              |   |   |   |
|                                                                                            |   |              |   |   |              |   |   |   |
| Shareholders'      equity:                                                                      |   |              |   |   |              |   |   |   |
|   Common      stock $0.001 par value; 100,000,000 shares authorized,                  |   |              |   |   |              |   |   |   |
|     20,283,573      and 55,947,331 issued and outstanding                   |   |              | 20     |   |              |   | 56 |   |
|   Additional      paid-in capital                                                     |   |              | 14,250 |   |              |   | 7,366 |   |
|   Treasury      stock (35,663,758 shares)                                             |   |              | (4,957 | )      |              |   | - |   |
|   Accumulated      deficit                                                            |   |              | (9,114 | )      |              |   | (8,824 | ) |
|   Accumulated      other comprehensive income                                         |   |              | -      |   |              |   | (95 | ) |
|                                                                                            |   |              |   |   |              |   |   |   |
|         Total      shareholders' equity                 |   |              | 199    |   |              |   | (1,497 | ) |
|                                                                                            |   |              |   |   |              |   |   |   |
|         Total      liabilities and shareholders' equity |   | $                 | 215    |   |              | $      | 1,116 |   |
|                                                                                            |   |              |   |   |              |   |   |   |
|                                                                                            |   |              | -      |   |              |   | - |   |

----

|                                                     |   | Years      Ended  |       |
|----------------------------------------------------------|--------|-------------------|------------|
|                                                     |   | December      31, |       |   | December      31, |   |
|                                                     |   | 2008              |       |   | 2007 |   |
| Revenue                                                  |   | $                 | -          |   |   | $ | - |   |
|                                                     |   |              |       |   |   |   |   |   |
| Cost      of revenue                                     |   |              | -          |   |   |   | - |   |
|                                                     |   |              |       |   |   |   |   |   |
| Gross      profit                                        |   |              | -          |   |   |   | - |   |
|                                                     |   |              |       |   |   |   |   |   |
| General      and administrative expenses                 |   |              | 39         |   |   |   | - |   |
|                                                     |   |              |       |   |   |   |   |   |
| Loss      from continuing operations before taxes        |   |              | (39        | ) |   |   | - |   |
|                                                     |   |              |       |   |   |   |   |   |
| Provision      for income taxes                          |   |              | -          |   |   |   | - |   |
|                                                     |   |              |       |   |   |   |   |   |
| Net      loss from continuing operations                 |   |              | (39        | ) |   |   | - |   |
|                                                     |   |              |       |   |   |   |   |   |
| Loss      from discontinued operations                   |   |              | (251       | ) |   |   | (1,245 | ) |
|                                                     |   |              |       |   |   |   |   |   |
| Provision      for income taxes                          |   |              | -          |   |   |   | 26 |   |
|                                                     |   |              |       |   |   |   |   |   |
| Net      loss from discountinued operations              |   |              | (251       | ) |   |   | (1,271 | ) |
|                                                     |   |              |       |   |   |   |   |   |
| Net      loss applicable to common shares                |   | $                 | (290       | ) |   | $ | (1,271 | ) |
|                                                     |   |              |       |   |   |   |   |   |
|                                                     |   |              |       |   |   |   |   |   |
| Net      loss per share:                                 |   |              |       |   |   |   |   |   |
|    Basic      - Continuing Operations     |   | $                 | (0.01      | ) |   | $ | (0.02 | ) |
|    Diluted      - Discontinued Operations |   | $                 | (0.01      | ) |   | $ | (0.02 | ) |
|                                                     |   |              |       |   |   |   |   |   |
| Weighted      average shares outstanding                 |   |              |       |   |   |   |   |   |
|    Basic      and Diluted                 |   |              | 39,434,523 |   |   |   | 55,947,330 |   |

----

|                                          |   |   |         |   |   |   |         | Additional |   |   |         |   |   |        |         |   | Other              |   |         |               |   |   |         |   |
|-----------------------------------------------|--------|--------|--------------|--------|--------|--------|--------------|------------|--------|--------|--------------|--------|--------|-------------|--------------|--------|--------------------|--------|--------------|--------------------|--------|--------|--------------|--------|
|                                          |   | Common |         |   | Par    |   |         | Paid-in    |   |   | Treasury     |   |   | Accumulated |         |   | Comprehensive      |   |         | Comprehensive      |   |   |         |   |
|                                          |   | Stock  |         |   | Value  |   |         | Capital    |   |   | Stock        |   |   | Deficit     |         |   | Income      (loss) |   |         | Income      (loss) |   |   | Total        |   |
| Balance      December 31, 2006                |   |   | 55,947,331   |   |   | $      | 56           |       |   | $      | 7,203        |   |   | $           | -            |   |               | $      | (7,553       | )                  |   | $      | (20          | )      |   |   |   |   | $ | (314 | ) |
|                                          |   |   |         |   |   |   |         |       |   |   |         |   |   |        |         |   |               |   |         |               |   |   |         |   |   |   |   |   |   |   |   |
| Stock      based compensation                 |   |   |         |   |   |   |         |       |   |   | 163          |   |   |        | -            |   |               |   |         |               |   |   |         |   |   |   |   |   |   | 163 |   |
|                                          |   |   |         |   |   |   |         |       |   |   |         |   |   |        |         |   |               |   |         |               |   |   |         |   |   |   |   |   |   |   |   |
| Net      loss                                 |   |   |         |   |   |   |         |       |   |   |         |   |   |        |         |   |               |   | (1,271       | )                  |   |   |         |   |   |   | (1,271 | ) |   |   | (1,271 | ) |
|                                          |   |   |         |   |   |   |         |       |   |   |         |   |   |        |         |   |               |   |         |               |   |   |         |   |   |   |   |   |   |   |   |   |
| Foreign      currency translation adjustments |   |   |         |   |   |   |         |       |   |   |         |   |   |        |         |   |               |   |         |               |   |   | (75          | )      |   |   | (75 | ) |   |   | (75 | ) |
|                                          |   |   |         |   |   |   |         |       |   |   |         |   |   |        |         |   |               |   |         |               |   |   |         |   |   |   |   |   |   |   |   |   |
| Comprehensive      loss                       |   |   |         |   |   |   |         |       |   |   |         |   |   |        |         |   |               |   |         |               |   |   |         |   |   | $ | (1,346 | ) |   |   |   |   |
|                                          |   |   |    |   |   |   |    |       |   |   |    |   |   |        |    |   |               |   |    |               |   |   |    |   |   |   |   |   |   |   |    |   |
|                                          |   |   |         |   |   |   |         |       |   |   |         |   |   |        |         |   |               |   |         |               |   |   |         |   |   |   |   |   |   |   |   |   |
| Balance      December 31, 2007                |   |   | 55,947,331   |   |   |   | 56           |       |   |   | 7,366        |   |   |        | -            |   |               |   | (8,824       | )                  |   |   | (95          | )      |   |   |   |   |   |   | (1,497 | ) |
|                                          |   |   |         |   |   |   |         |       |   |   |         |   |   |        |         |   |               |   |         |               |   |   |         |   |   |   |   |   |   |   |   |   |
|  Reversal      of May 2005 acquisition   |   |   | (35,663,758  | )      |   |   | (36          | )          |   |   | 6,884        |   |   |        | (4,957       | )      |               |   |         |               |   |   |         |   |   |   |   |   |   |   | 1,891 |   |
|                                          |   |   |         |   |   |   |         |       |   |   |         |   |   |        |         |   |               |   |         |               |   |   |         |   |   |   |   |   |   |   |   |   |
|  Net      Loss                           |   |   |         |   |   |   |         |       |   |   |         |   |   |        |         |   |               |   | (290         | )                  |   |   |         |   |   |   | (290 | ) |   |   | (290 | ) |
|                                          |   |   |         |   |   |   |         |       |   |   |         |   |   |        |         |   |               |   |         |               |   |   |         |   |   |   |   |   |   |   |   |   |
| Translation      adjustment                   |   |   |         |   |   |   |         |       |   |   |         |   |   |        |         |   |               |   |         |               |   |   | 95           |   |   |   | 95 |   |   |   | 95 |   |
|                                          |   |   |         |   |   |   |         |       |   |   |         |   |   |        |         |   |               |   |         |               |   |   |         |   |   |   |   |   |   |   |   |   |
| Comprehensive      loss                       |   |   |         |   |   |   |         |       |   |   |         |   |   |        |         |   |               |   |         |               |   |   |         |   |   | $ | (195 | ) |   |   |   |   |
|                                          |   |   |    |   |   |   |    |       |   |   |    |   |   |        |    |   |               |   |    |               |   |   |    |   |   |   |   |   |   |   |    |   |
|                                          |   |   |         |   |   |   |         |       |   |   |         |   |   |        |         |   |               |   |         |               |   |   |         |   |   |   |   |   |   |   |   |   |
|  Balance      December 31, 2008          |   |   | 20,283,573   |   |   | $      | 20           |       |   | $      | 14,250       |   |   | $           | (4,957       | )      |               | $      | (9,114       | )                  |   | $      | -            |   |   |   |   |   |   | $ | 199 |   |

----

|                                                                                                            |   | Year      Ended   |   |
|-----------------------------------------------------------------------------------------------------------------|--------|-------------------|--------|
|                                                                                                            |   | December      31, |   |   | December      31, |   |
|                                                                                                            |   | 2008              |   |   | 2007 |   |
| Cash      flows from operating activities:                                                                      |   |              |   |   |   |   |
|   Net      loss                                                                                       |   | $                 | (39    | ) |   | $ | - |   |
|   Adjustments      to reconcile net loss to net cash provided by (used in) operating      activities: |   |              |   |   |   |   |   |   |
|   Increase      in accounts payable                                                                   |   |              | 16     |   |   |   | - |   |
| Net      cash provided by operating activities                                                                  |   |              | (23    | ) |   |   | - |   |
|                                                                                                            |   |              |   |   |   |   |   |   |
| Discontinued      Operations                                                                                    |   |              |   |   |   |   |   |   |
| Loss      from discontinued operations                                                                          |   |              | (251   | ) |   |   | (1,271 | ) |
|   Adjustments      to reconcile net cash provided by discontinued operations                          |   |              | 359    |   |   |   | 445 |   |
|                                                                                                            |   |              |   |   |   |   |   |   |
| Net      cash provided by (used in) operating activities - discontinued      operations                         |   |              | 108    |   |   |   | (826 | ) |
|                                                                                                            |   |              |   |   |   |   |   |   |
| Cash      flows from investing activities:                                                                      |   |              |   |   |   |   |   |   |
| Discontinued      Operations                                                                                    |   |              |   |   |   |   |   |   |
|   Adjustments      to reconcile net cash used in discontinued operations                              |   |              | (119   | ) |   |   | (1 | ) |
| Net      cash used in investing activities                                                                      |   |              | (119   | ) |   |   | (1 | ) |
|                                                                                                            |   |              |   |   |   |   |   |   |
| Cash      flows from financing activities:                                                                      |   |              |   |   |   |   |   |   |
| Discontinued      Operations                                                                                    |   |              |   |   |   |   |   |   |
|   Adjustments      to reconcile net cash provided by discontinued operations                          |   |              | -      |   |   |   | 22 |   |
| Net      cash provided by financing activities                                                                  |   |              | -      |   |   |   | 22 |   |
|                                                                                                            |   |              |   |   |   |   |   |   |
| Effect      of exchange rates changes on cash                                                                   |   |              | 95     |   |   |   | 33 |   |
|                                                                                                            |   |              |   |   |   |   |   |   |
| Net      increase (decrease) in cash                                                                            |   |              | 61     |   |   |   | (772 | ) |
| Cash      at beginning of period                                                                                |   |              | 154    |   |   |   | 926 |   |
|                                                                                                            |   |              |   |   |   |   |   |   |
| Cash      at end of period                                                                                      |   | $                 | 215    |   |   | $ | 154 |   |
|                                                                                                            |   |              |   |   |   |   |   |   |
| Supplemental Cash Flow      Information                                                                         |   |              |   |   |   |   |   |   |
| During      the period, cash was paid for the following:                                                        |   |              |   |   |   |   |   |   |
|     Interest                                                                                |   |              | -      |   |   |   | - |   |
|     Income      taxes                                                                       |   |              | -      |   |   |   | - |   |

----

----

PROPERTY AND EQUIPMENT

|                                                      |   | years  |   |
|-----------------------------------------------------------|--------|--------|--------|
| Motor      vehicles                                       |   |   | 7      |   |
| Office      furniture and equipment (including computers) |   |   | 3-17   |   |

The Company’s obligation for severance pay is provided by monthlydeposits with insurance companies (“Severance pay funds”). Severance pay fundspresented in the balance sheet include profits accumulated to balance sheetdate. The amounts deposited may only be withdrawn after fulfillment of theobligations pursuant to Israeli Severance Pay Law or labor agreements. The valueof the deposited funds is based on the cash surrender value of these funds andincludes immaterial profits.

----

|                    |   | YEAR      ENDED DECEMBER 31, |   |
|-------------------------|--------|------------------------------|--------|
|                    |   | 2008                         |   |   | 2007 |   |
| Operating      expenses |   |                         | 95     |   |   |   | 163 |   |
| Total                   |   | $                            | 95     |   |   | $ | 163 |   |

|   | 1. | Revenue      from installation automated material handling  system |
|--------|----|--------------------------------------------------------------------|

|   | 2. | Revenues      from sale of software and products |
|--------|----|--------------------------------------------------|

----

|   | 3. | Revenues      from maintenance services and support  |
|--------|----|-----------------------------------------------------------|

|   | 4. | Revenues      from sale of spare parts |
|--------|----|----------------------------------------|

|   | 5. | Revenues      from commissions |
|--------|----|--------------------------------|

|   | 6. | Deferred      revenue |
|--------|----|-----------------------|

| Balance,      at January 1, 2007                   |   | $      | 65     |   |
|----------------------------------------------------|--------|--------|--------|--------|
| Warranties      issued during the year             |   |   | 3      |   |
| Warranties      expired or settled during the year |   |   | (44    | )      |
|                                               |   |   |   |   |
| Balance,      at December 31, 2007                 |   | $      | 24     |   |

----

RECENT ACCOUNTING PRONOUNCEMENTS

|   | 1. | In      September 2006, the FASB issued SFAS No. 157, “Fair Value      Measurements” (SFAS No. 157). The purpose of SFAS No. 157 is to      define fair value, establish a framework for measuring fair value, and      enhance disclosures about fair value measurements. The measurement and      disclosure requirements are effective for the Company beginning in the      first quarter of fiscal year 2008. The Company does not believe that the      adoption of SFAS No. 157 will have a significant impact on its      consolidated financial statement. |
|--------|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 2. | In      February 2007, the FASB issued SFAS No. 159, “The Fair      Value Option for Financial Assets and Financial Liabilities” (SFAS      No. 159). SFAS No. 159 permits companies to choose to measure      certain financial instruments and certain other items at fair value. The      standard requires that unrealized gains and losses on items for which the      fair value option has been elected be reported in earnings. SFAS      No. 159 is effective for the Company beginning in the first quarter      of fiscal year 2008, although earlier adoption is permitted. The Company      does not believe that the adoption of SFAS No. 159 will have a significant      impact on its consolidated financialstatement. |
|--------|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 3. | In      June 2007, the FASB ratified Emerging Issues Task Force (EITF)       Issue No. 07-3,      “Accounting for Nonrefundable Advance Payments for Goods or Services to Be      Used in Future Research and Development Activities” (EITF 07-3).      EITF 07-3 requires non-refundable advance payments for goods and services      to be used in future research and development activities to be recorded as      an asset and the payments to be expensed when the research and development      activities are performed. EITF 07-3 applies prospectively for new      contractual arrangements entered into beginning in the first quarter of      fiscal year 2008. We currently recognize these non-refundable advanced      payments as an expense upon payment. The adoption of EITF 07-3 is not      expected to have a significant impact on the Company's consolidated      financial statements. |
|--------|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 4. | In      December 2007, the FASB issued SFAS No. 141(R)      “Business Combinations” (“SFAS 141(R)”) and SFAS No. 160,      “Non-controlling Interests in Consolidated Financial Statement”      (“SFAS 160”) . SFAS 141(R) requires the acquiring entity      in a business combination to record all assets acquired and liabilities      assumed at their respective acquisition-date fair values and changes other      practices under FAS 141, some of which could have a material impact      on how we account for business combinations. SFAS 141(R) also      requires additional disclosure of information surrounding a business      combination, such that users of the entity’s financial statements can      fully understand the nature and financial impact of the business      combination. SFAS 160 requires entities to report non-controlling      (minority) interests in subsidiaries as equity in the consolidated      financial statements. The Company is required to adopt SFAS 141(R)      and SFAS 160 simultaneously in its fiscal year beginning      November 1, 2009. The provisions of SFAS 141(R) will only impact      the Company if it is a party to a business combination after the      pronouncement has been adopted. Currently, the Company does not believe      that the adoption of SFAS No. 141R and SFAS No. 160 will have a      significant impact on its consolidated financial  statement. |
|--------|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

|                 |   | December      31, |   |
|----------------------|--------|-------------------|--------|
|                 |   | 2007              |   |
| Cash                 |   | $                 | 74     |   |
| Deposits      in USD |   |              | 80     |   |
|                 |   |              |   |   |
|                 |   | $                 | 154    |   |

|                     |   | Annual      Interestrate      as      of |   |              |   |
|--------------------------|--------|------------------------------------------|--------|-------------------|--------|
|                     |   | December      31,                        |   | December      31, |   |
|                     |   | 2007                                     |   | 2007              |   |
|                     |   | %                                   |   |              |   |
| Deposits      in NIS (1) |   | 3.3                                      |   | $                 | 159    |   |
| Deposits      in USD (2) |   | 3.9-4.0                                  |   |              | 101    |   |
|                     |   |                                     |   | $                 | 260    |   |

----

| (1) | The      deposits include a balance in the amount of $87 that serves as collateral      for a bank guarantee issued to secure a bid submittal, a balance of $11      serves as collateral for bank guarantees issued to secure rental fees (see      Note 11a) and a balance of $42 serves as collateral for bank guarantees      issued to secure advances received from  customers. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |                                                                                                                                                                                                               |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2)    | The      deposits include a balance of $27 serves as collateral for bank guarantees      issued to secure advances received from customers and a balance of $74      serves as collateral against creditline. |

NOTE 7 - PROPERTY AND EQUIPMENT,NET

|   | A. | COMPOSITION |
|--------|----|-------------|

|   |
|--------|

|                                |   | December      31, |   |
|-------------------------------------|--------|-------------------|--------|
|                                |   | 2007              |   |
| Cost                                |   |              |   |   |
| Motor      vehicles                 |   | $                 | 153    |   |
| Office      furniture and equipment |   |              | 381    |   |
|                                |   |              | 534    |   |
| Accumulated      depreciation       |   |              | 394    |   |
| Equipment,      net                 |   | $                 | 140    |   |

|   | B. | Depreciation      expense for the years ended December 31, 2008 and 2007 amounted to $24 and      $44 respectively. In addition, the Company recognized in 2007 an      impairment loss of $44. |
|--------|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

NOTE 8 - OTHER ACCOUNTSPAYABLE

|                                        |   | December      31, |   |   | December      31, |   |
|---------------------------------------------|--------|-------------------|--------|--------|-------------------|--------|
|                                        |   | 2008              |   |   | 2007              |   |
| Payroll      and related expenses           |   | $                 | -      |   |              | $      | 77 |   |
| Provision      for employees vacation leave |   |              | -      |   |              |   | 165 |   |
| Government      authorities                 |   |              | -      |   |              |   | 85 |   |
| Provision      for warranty                 |   |              | -      |   |              |   | 24 |   |
| Accrued      Expenses                       |   |              | 16     |   |              |   | 139 |   |
|                                        |   |              |   |   |              |   |   |   |
|                                        |   | $                 | 16     |   |              | $      | 490 |   |

NOTE 9 - LONG-TERM LOANS

|   | a. | COMPOSITION: |
|--------|----|--------------|

|                           |   | Annual      interest rate |   |          |      |              |   |
|--------------------------------|--------|---------------------------|--------|---------------|-----------|-------------------|--------|
|                           |   | as      of                |   |          |      |              |   |
|                           |   | December      31,         |   | Years      of |      | December      31, |   |
|                           |   | 2007                      |   | maturity      |      | 2007              |   |
| From      bank                 |   |                      | 5.85   | %             | 2007-2010 |              | $      | 22 |   |
| From      Leasing Company      |   |                      | -      |          | 2007-2008 |              |   | 3 |   |
|                           |   |                      |   |          |      |              |   | 25 |   |
| Less      - current maturities |   |                      |   |          |      |              |   | (11 | ) |
|                           |   |                      |   |          |      |              | $      | 14 |   |

| 2008-      current maturities |   |   | 11 |   |
|-------------------------------|--------|--------|----|--------|
| 2009                          |   |   | 8  |   |
| 2010                          |   |   | 6  |   |
|                          |   | $      | 25 |   |

|   | b. | With      respect to collateral, see Note11b. |
|--------|----|-----------------------------------------------|

|   | a. | APPLICABLE      TAX LAWS – this pertains to discontinued  operations: |
|--------|----|-----------------------------------------------------------------------------|

----

|   | b. | TAX      LOSSES CARRYFORWARD this pertains to discontinued    operations: |
|--------|----|---------------------------------------------------------------------------|

|   | c. | FINAL      TAX ASSESSMENTS – this pertains to discontinued  operations: |
|--------|----|-------------------------------------------------------------------------------|

|   | d. | DEFERRED      TAXES – this pertains to discontinued  operations: |
|--------|----|------------------------------------------------------------------------|

DEFERRED TAX ASSETS:

|                                             |   | December 31, |   |
|--------------------------------------------------|--------|--------------|--------|
|                                             |   | 2007         |   |
| Short-term      deferred tax assets-net:         |   |         |   |
| Provision      for employees vacation leave      |   | $            | 165    |   |
| Valuation      allowance                         |   |         | (165   | ) |
|                                             |   | $            | -      |   |
| Long-term      deferred tax assets-net:          |   |         |   |   |
|                                             |   |         |   |   |
| Accrued      severance pay and others            |   | $            | 652    |   |
| Carryforward      tax losses of the company      |   |         | 993    |   |
| Carryforward      tax losses of the subsidiaries |   |         | 3,057  |   |
|                                             |   |         | 4,702  |   |
| Valuation      allowance                         |   |         | (4,702 | ) |
|                                             |   | $            | -      |   |

|   | e. | INCOME      TAX EXPENSES |
|--------|----|--------------------------|

|                  |   | For      the years endedDecember,      31 |   |
|-----------------------|--------|-------------------------------------------|--------|
|                  |   | 2008                                      |   |   | 2006 |   |
|                  |   |                                      |   |   |   |   |
| Current      non-U.S. |   | $                                         | -      |   |   | $ | 26 |   |

----

|   | a. | GUARANTEES: |
|--------|----|-------------|

|   | b. | CHARGES: |
|--------|----|----------|

NOTE 12 – RELATED PARTYTRANSACTIONS

|                             |   | Six      Months |   |   |              |   |
|----------------------------------|--------|-----------------|--------|--------|-------------------|--------|
|                             |   | Ended           |   |   | Year      Ended   |   |
|                             |   | June      30,   |   |   | December      31, |   |
|                             |   | 2008            |   |   | 2007              |   |
| Revenues                         |   | $               | 1,793  |   |              | $      | 2,745 |   |
| Cost      of Revenues            |   |            | 1,057  |   |              |   | 2,014 |   |
| Gross      Profit                |   |            | 736    |   |              |   | 731 |   |
| Operating      Expenses          |   |            | 819    |   |              |   | 1,961 |   |
| Operating      Loss              |   |            | (83    | )      |              |   | (1,230 | ) |
| Other      Income (Expense), net |   |            | (3     | )      |              |   | (15 | ) |
| Provision      for Taxes         |   |            | 216    |   |              |   | (26 | ) |
| Net      Income (Loss)           |   | $               | 130    |   |              | $      | (1,271 | ) |

----

----