Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Feb. 07, 2014 | Jun. 30, 2013 | |
Document and Entity Information [Abstract] | ' | ' | ' |
Entity Registrant Name | 'AWARE INC /MA/ | ' | ' |
Entity Central Index Key | '0001015739 | ' | ' |
Trading Symbol | 'awre | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' |
Entity Voluntary Filers | 'No | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' |
Entity Filer Category | 'Accelerated Filer | ' | ' |
Entity Well-Known Seasoned Issuer | 'No | ' | ' |
Entity Common Stock, Shares Outstanding | ' | 22,624,375 | ' |
Entity Public Float | ' | ' | $66,554,082 |
Document Type | '10-K | ' | ' |
Document Period End Date | 31-Dec-13 | ' | ' |
Amendment Flag | 'false | ' | ' |
Document Fiscal Year Focus | '2013 | ' | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $72,660 | $71,074 |
Accounts receivable (less allowance for doubtful accounts of $20 at December 31, 2013 and 2012) | 4,582 | 3,457 |
Receivable from patent arrangement | ' | 1,121 |
Inventories | 1,601 | ' |
Deferred tax assets | 383 | 817 |
Prepaid expenses and other current assets | 695 | 528 |
Total current assets | 79,921 | 76,997 |
Property and equipment, net | 5,582 | 5,904 |
Investments | 2,754 | 2,010 |
Long term deferred tax assets | 762 | 943 |
Other assets | 310 | ' |
Total assets | 89,329 | 85,854 |
Current liabilities: | ' | ' |
Accounts payable | 1,516 | 328 |
Accrued expenses | 108 | 148 |
Accrued compensation | 571 | 817 |
Accrued professional fees | 118 | 142 |
Deferred revenue | 1,848 | 2,204 |
Total current liabilities | 4,161 | 3,639 |
Long-term deferred revenue | 18 | 319 |
Commitments and contingent liabilities (Note 9) | ' | ' |
Stockholders' equity: | ' | ' |
Preferred stock, $1.00 par value; 1,000,000 shares authorized, none outstanding | ' | ' |
Common stock, $.01 par value; shares authorized, 70,000,000 in 2013 and 2012; issued and outstanding 22,574,251 in 2013 and 22,509,518 in 2012 | 226 | 225 |
Additional paid-in capital | 101,293 | 100,561 |
Accumulated other comprehensive loss | -125 | -50 |
Accumulated deficit | -16,244 | -18,840 |
Total stockholders' equity | 85,150 | 81,896 |
Total liabilities and stockholders' equity | $89,329 | $85,854 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parentheticals) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, except Share data, unless otherwise specified | ||
Statement Of Financial Position [Abstract] | ' | ' |
Allowance for doubtful accounts (in dollars) | $20 | $20 |
Preferred stock, par value (in dollars per share) | $1 | $1 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares outstanding | ' | ' |
Common stock, par value (in dollars per share) | $0.01 | $0.01 |
Common stock, shares authorized | 70,000,000 | 70,000,000 |
Common stock, shares issued | 22,574,251 | 22,509,518 |
Common stock, shares outstanding | 22,574,251 | 22,509,518 |
CONSOLIDATED_STATEMENTS_OF_INC
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Revenue: | ' | ' | ' |
Software licenses | $8,241 | $9,525 | $7,801 |
Software maintenance | 3,866 | 3,038 | 2,590 |
Services | 3,148 | 2,571 | 3,662 |
Hardware sales | 3,182 | ' | ' |
Royalties | 920 | 2,170 | 2,146 |
Total revenue | 19,357 | 17,304 | 16,199 |
Costs and expenses: | ' | ' | ' |
Cost of hardware sales | 2,365 | ' | ' |
Cost of services | 1,503 | 1,542 | 1,518 |
Research and development | 4,085 | 3,489 | 3,203 |
Selling and marketing | 3,344 | 3,370 | 2,973 |
General and administrative | 3,522 | 3,860 | 5,005 |
Total costs and expenses | 14,819 | 12,261 | 12,699 |
Operating income before patent related income | 4,538 | 5,043 | 3,500 |
Gain on sale of patent assets | ' | 86,394 | ' |
Income from patent arrangement | 780 | 1,121 | ' |
Operating income after patent related income | 5,318 | 92,558 | 3,500 |
Other income | 23 | 85 | ' |
Interest income | 328 | 227 | 83 |
Income from continuing operations before income taxes | 5,669 | 92,870 | 3,583 |
Provision for income taxes | 1,917 | 20,487 | 2 |
Income from continuing operations | 3,752 | 72,383 | 3,581 |
Loss from discontinued operations, net of income taxes | -1,156 | -76 | -1,014 |
Net income | 2,596 | 72,307 | 2,567 |
Basic net income per share: | ' | ' | ' |
Basic net income per share from continuing operations (in dollars per share) | $0.17 | $3.32 | $0.17 |
Basic net loss per share from discontinued operations (in dollars per share) | ($0.05) | $0 | ($0.05) |
Basic net income per share (in dollars per share) | $0.12 | $3.32 | $0.12 |
Diluted net income per share: | ' | ' | ' |
Diluted net income per share from continuing operations (in dollars per share) | $0.16 | $3.28 | $0.17 |
Diluted net loss per share from discontinued operations (in dollars per share) | ($0.05) | $0 | ($0.05) |
Diluted net income per share (in dollars per share) | $0.11 | $3.28 | $0.12 |
Weighted-average shares - basic (in shares) | 22,543 | 21,814 | 20,534 |
Weighted-average shares - diluted (in shares) | 22,641 | 22,071 | 20,735 |
Comprehensive income: | ' | ' | ' |
Net income | 2,596 | 72,307 | 2,567 |
Other comprehensive income (net of tax): | ' | ' | ' |
Unrealized losses on available for sale securities | -75 | -30 | -20 |
Comprehensive income | $2,521 | $72,277 | $2,547 |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Cash flows from operating activities: | ' | ' | ' |
Net income | $2,596 | $72,307 | $2,567 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ' | ' | ' |
Depreciation and amortization | 458 | 453 | 475 |
Stock-based compensation | 662 | 321 | 1,277 |
Gain on sale of patent assets | ' | -86,394 | ' |
Amortization of premium (discount) on investments | 15 | -18 | -9 |
Gain on sale of investments | -23 | -85 | ' |
Deferred tax benefit on other comprehensive income | 81 | ' | ' |
Loss on disposal of property and equipment | 28 | ' | ' |
Provision for doubtful accounts | ' | 4 | ' |
Increase (decrease) from changes in assets and liabilities: | ' | ' | ' |
Accounts receivable | -1,125 | 85 | 1,422 |
Receivable from patent arrangement | 1,121 | -1,121 | ' |
Inventories | -1,601 | 547 | 1,316 |
Prepaid expenses and other current assets | -167 | -315 | 22 |
Deferred tax assets | 563 | -1,760 | ' |
Accounts payable | 1,188 | -71 | -166 |
Accrued expenses, compensation and professional | -310 | 9 | -590 |
Deferred revenue | -657 | 744 | 515 |
Net cash provided by (used in) operating activities | 2,829 | -15,294 | 6,829 |
Cash flows from investing activities: | ' | ' | ' |
Purchases of property and equipment | -160 | -116 | -331 |
Proceeds from sale of property and equipment | 24 | ' | ' |
Purchases of investments | -2,008 | -2,065 | -737 |
Sales of investments | 1,117 | 855 | ' |
Proceeds from sale of patent assets, net | ' | 86,394 | ' |
Purchase of other assets | -338 | ' | ' |
Net cash provided by (used in) investing activities | -1,365 | 85,068 | -1,068 |
Cash flows from financing activities: | ' | ' | ' |
Proceeds from issuance of common stock | 65 | 6,526 | 1,826 |
Payment of dividends | ' | -66,024 | ' |
Excess tax benefits from stock-based compensation | 128 | 14,395 | ' |
Payments made for taxes of employees who surrendered shares related to unrestricted stock | -71 | -174 | -224 |
Repurchase of common stock | ' | ' | -735 |
Net cash provided by (used in) financing activities | 122 | -45,277 | 867 |
Increase in cash and cash equivalents | 1,586 | 24,497 | 6,628 |
Cash and cash equivalents, beginning of year | 71,074 | 46,577 | 39,949 |
Cash and cash equivalents, end of year | 72,660 | 71,074 | 46,577 |
Supplemental disclosure: | ' | ' | ' |
Cash paid for income taxes | $542 | $7,954 | $2 |
CONSOLIDATED_STATEMENTS_OF_STO
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (USD $) | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | (Accumulated Deficit) | Total |
In Thousands, except Share data, unless otherwise specified | |||||
Balance at Dec. 31, 2010 | $200 | $77,373 | ' | ($27,690) | $49,883 |
Balance (in shares) at Dec. 31, 2010 | 20,042,000 | ' | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' | ' |
Exercise of common stock options | 6 | 1,804 | ' | ' | 1,810 |
Exercise of common stock options (in shares) | 596,000 | ' | ' | ' | ' |
Issuance of unrestricted stock | 3 | -3 | ' | ' | ' |
Issuance of unrestricted stock (in shares) | 300,000 | ' | ' | ' | ' |
Shares surrendered by employees to pay taxes related to unrestricted stock | -1 | -223 | ' | ' | -224 |
Shares surrendered by employees to pay taxes related to unrestricted stock (in shares) | -70,000 | ' | ' | ' | ' |
Repurchase of common stock | -2 | -733 | ' | ' | -735 |
Repurchase of common stock (in shares) | -250,000 | ' | ' | ' | ' |
Issuance of common stock under employee stock purchase plan | ' | 17 | ' | ' | 17 |
Issuance of common stock under employee stock purchase plan (in shares) | 5,000 | ' | ' | ' | ' |
Stock-based compensation expense | ' | 1,277 | ' | ' | 1,277 |
Accumulated other comprehensive loss: | ' | ' | ' | ' | ' |
Unrealized loss on securities | ' | ' | -20 | ' | -20 |
Net income | ' | ' | ' | 2,567 | 2,567 |
Balance at Dec. 31, 2011 | 206 | 79,512 | -20 | -25,123 | 54,575 |
Balance (in shares) at Dec. 31, 2011 | 20,623,000 | ' | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' | ' |
Exercise of common stock options | 18 | 6,481 | ' | ' | 6,499 |
Exercise of common stock options (in shares) | 1,764,000 | ' | ' | ' | ' |
Issuance of unrestricted stock | 1 | -1 | ' | ' | ' |
Issuance of unrestricted stock (in shares) | 151,000 | ' | ' | ' | ' |
Shares surrendered by employees to pay taxes related to unrestricted stock | ' | -174 | ' | ' | -174 |
Shares surrendered by employees to pay taxes related to unrestricted stock (in shares) | -33,000 | ' | ' | ' | ' |
Issuance of common stock under employee stock purchase plan | ' | 27 | ' | ' | 27 |
Issuance of common stock under employee stock purchase plan (in shares) | 5,000 | ' | ' | ' | ' |
Stock-based compensation expense | ' | 321 | ' | ' | 321 |
Tax benefits from stock-based awards | ' | 14,395 | ' | ' | 14,395 |
Dividend payment | ' | ' | ' | -66,024 | -66,024 |
Accumulated other comprehensive loss: | ' | ' | ' | ' | ' |
Unrealized loss on securities | ' | ' | -30 | ' | -30 |
Net income | ' | ' | ' | 72,307 | 72,307 |
Balance at Dec. 31, 2012 | 225 | 100,561 | -50 | -18,840 | 81,896 |
Balance (in shares) at Dec. 31, 2012 | 22,510,000 | ' | ' | ' | 22,509,518 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' | ' |
Exercise of common stock options | ' | 26 | ' | ' | 26 |
Exercise of common stock options (in shares) | 6,000 | ' | ' | ' | ' |
Issuance of unrestricted stock | 1 | -1 | ' | ' | ' |
Issuance of unrestricted stock (in shares) | 65,000 | ' | ' | ' | ' |
Shares surrendered by employees to pay taxes related to unrestricted stock | ' | -71 | ' | ' | -71 |
Shares surrendered by employees to pay taxes related to unrestricted stock (in shares) | -14,000 | ' | ' | ' | ' |
Issuance of common stock under employee stock purchase plan | ' | 40 | ' | ' | 40 |
Issuance of common stock under employee stock purchase plan (in shares) | 7,000 | ' | ' | ' | ' |
Stock-based compensation expense | ' | 662 | ' | ' | 662 |
Tax benefits from stock-based awards | ' | 128 | ' | ' | 128 |
Deferred tax asset write-off | ' | -52 | ' | ' | -52 |
Accumulated other comprehensive loss: | ' | ' | ' | ' | ' |
Unrealized loss on securities | ' | ' | -156 | ' | -156 |
Deferred tax benefit on unrealized losses | ' | ' | 81 | ' | 81 |
Net income | ' | ' | ' | 2,596 | 2,596 |
Balance at Dec. 31, 2013 | $226 | $101,293 | ($125) | ($16,244) | $85,150 |
Balance (in shares) at Dec. 31, 2013 | 22,574,000 | ' | ' | ' | 22,574,251 |
NATURE_OF_BUSINESS
NATURE OF BUSINESS | 12 Months Ended | |
Dec. 31, 2013 | ||
Organization, Consolidation and Presentation Of Financial Statements [Abstract] | ' | |
NATURE OF BUSINESS | ' | |
1 | NATURE OF BUSINESS | |
We are a leading provider of software and services to the biometrics industry. Our software products are used in government and commercial biometrics systems, which are capable of determining or verifying an individual’s identity. We also offer engineering services related to software customization, integration, and installation, as well as complete systems development. We sell our biometrics software products and services globally through systems integrators, OEMs, and directly to end user customers |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | ||||||||||||
2 | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||||||||||||
Basis of Presentation - The consolidated financial statements include the accounts of Aware, Inc. and its subsidiary. All significant intercompany transactions have been eliminated. | |||||||||||||
Use of Estimates – The preparation of our financial statements in conformity with accounting principles generally accepted in the United States of America requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. The most significant estimates included in the financial statements pertain to revenue recognition, reserves for doubtful accounts, useful lives of fixed assets, valuation allowance for deferred income tax assets, and accrued liabilities. Actual results could differ from those estimates. | |||||||||||||
Fair Value Measurements - The Financial Accounting Standards Board (“FASB”) Codification defines fair value, and establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to the unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurements) and the lowest priority to unobservable inputs (level 3 measurements). The three levels of the fair value hierarchy under the FASB Codification are: i) Level 1 – valuations that are based on quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date; ii) Level 2 – valuations that are based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly; and iii) Level 3 – valuations that require inputs that are both significant to the fair value measurement and unobservable. | |||||||||||||
Cash and cash equivalents, which primarily include money market mutual funds, were $72.7 million and $71.1 million as of December 31, 2013 and December 31, 2012, respectively. We classified our cash equivalents of $68.6 million and $67.1 million as of December 31, 2013 and 2012, respectively, within Level 1 of the fair value hierarchy because they are valued using quoted market prices. | |||||||||||||
Our investments, which consist of high yield corporate debt securities, are also classified within Level 1 of the fair value hierarchy because they are valued using quoted market prices. We categorize our investments as available-for-sale securities, and carry them at fair value in our financial statements. We had $2.8 million and $2.0 million of available-for-sale investments as of December 31, 2013 and December 31, 2012, respectively. | |||||||||||||
As of December 31, 2013, our assets that are measured at fair value on a recurring basis and whose carrying values approximate their respective fair values include the following (in thousands): | |||||||||||||
Fair Value Measurement at December 31, 2013 Using: | |||||||||||||
Quoted Prices in | Significant Other | Significant | |||||||||||
Active Markets for | Observable Inputs | Unobservable | |||||||||||
Identical Assets | Inputs | ||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||
Corporate debt securities | $ | 2,754 | $ | - | $ | - | |||||||
Money market funds (included in cash and cash equivalents) | 68,556 | ||||||||||||
Total | $ | 71,310 | $ | - | $ | - | |||||||
As of December 31, 2012, our assets that are measured at fair value on a recurring basis and whose carrying values approximate their respective fair values include the following (in thousands): | |||||||||||||
Fair Value Measurement at December 31, 2012 Using: | |||||||||||||
Quoted Prices in | Significant Other | Significant | |||||||||||
Active Markets for | Observable Inputs | Unobservable | |||||||||||
Identical Assets | Inputs | ||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||
Corporate debt securities | $ | 2,010 | $ | - | $ | - | |||||||
Money market funds (included in cash and cash equivalents) | 67,050 | ||||||||||||
Total | $ | 69,060 | $ | - | $ | - | |||||||
Cash and Cash Equivalents – Cash and cash equivalents, which consist primarily of money market funds and demand deposits, are stated at fair value. All highly liquid investments purchased with an original maturity of three months or less are considered cash equivalents. Our cash balances exceed the Federal Deposit Insurance Corporation limits. The Company does not believe it is exposed to significant credit risk related to cash and cash equivalents. | |||||||||||||
Investments - At December 31, 2013 and 2012, we categorized all investment securities as available-for-sale, since we may liquidate these investments currently. In calculating realized gains and losses, cost is determined using specific identification. Unrealized gains and losses on available-for-sale securities are excluded from earnings and reported in a separate component of stockholders’ equity called Accumulated Comprehensive Income. | |||||||||||||
Realized gains on investments were $23,000 and $85,000 in the years ended December 31, 2013 and 2012, respectively. There were no realized gains or losses on investments in the year ended December 31, 2011. | |||||||||||||
Unrealized losses on investments were $156,000, $30,000, and $20,000 in the years ended December 31, 2013, 2012, and 2011. | |||||||||||||
The amortized cost of our corporate debt securities was $3.0 million at December 31, 2013. Corporate debt securities comprising investments mature in 2015 to 2018. | |||||||||||||
Allowance for Doubtful Accounts – Accounts are charged to the allowance for doubtful accounts as they are deemed uncollectible based on a periodic review of the accounts. | |||||||||||||
Inventories – Inventories are stated at the lower of cost or net realizable value. Cost is determined by the first-in, first-out (“FIFO”) method. We evaluate all inventories for net realizable value on a quarterly basis, and record provisions for excess and obsolete inventory when required. There was no reserve for excess and obsolete inventory as of December 31, 2013. | |||||||||||||
Property and Equipment – Property and equipment is stated at cost. Depreciation and amortization of property and equipment is provided using the straight-line method over the estimated useful lives of the assets. Upon retirement or sale, the costs of the assets disposed of and the related accumulated depreciation are removed from the accounts and any resulting gain or loss on disposal is included in the determination of income or loss. Expenditures for repairs and maintenance are charged to expense as incurred. | |||||||||||||
The estimated useful lives of assets used by us are: | |||||||||||||
Building | 30 years | ||||||||||||
Building improvements | 5 to 20 years | ||||||||||||
Furniture and fixtures | 5 years | ||||||||||||
Computer, office & manufacturing equipment | 3 years | ||||||||||||
Purchased software | 3 years | ||||||||||||
Impairment of Long-Lived Assets – We review long-lived assets for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable or that the useful lives of these assets are no longer appropriate. Each impairment test is based on a comparison of the undiscounted cash flows estimated to be generated by those assets over their estimated economic life to the related carrying value of those assets to determine if the assets are impaired. If an impairment is indicated, the asset is written down to its estimated fair value. The cash flow estimates used to identify the potential impairment reflect our best estimates using appropriate assumptions and projections at that time. We believe that no significant impairment of our long-lived assets has occurred as of December 31, 2013 and 2012. | |||||||||||||
Revenue Recognition – We recognize revenue when there is persuasive evidence of an arrangement, the sales price is fixed or determinable, collection of the related receivable is reasonably assured, and delivery has occurred or services have been rendered. | |||||||||||||
Persuasive evidence of an arrangement: We use contracts signed by both the customer and us or written purchase orders issued by the customer as evidence of an arrangement. | |||||||||||||
Product delivery: We deem delivery to have occurred: (i) upon shipment when products are shipped FOB shipping point, or (ii) upon delivery at a customer’s location when products are shipped FOB destination, or (iii) when software is delivered electronically. If customer acceptance provisions apply, revenue is not recognized until delivery has occurred and we have received such acceptance. If we are required to provide installation services, revenue is not recognized until installation is complete. | |||||||||||||
Fixed or determinable fee: We consider fees to be fixed or determinable if the fee is not subject to refund or adjustment and the payment terms are within normal established practices. If the fee is not fixed or determinable, we recognize the revenue as amounts become due and payable. | |||||||||||||
Collection is deemed probable: We conduct a credit review for significant transactions at the time of the arrangement to determine the credit-worthiness of the customer. Collection is deemed probable if we expect that the customer will pay amounts under the arrangement as payments become due. | |||||||||||||
We categorize revenue as software licenses, software maintenance, services, hardware sales, or royalties. In addition to the general revenue recognition policies described above, specific revenue recognition policies apply to each category of revenue. | |||||||||||||
Software licenses | |||||||||||||
Software licenses consist of revenue from the sale of software licenses for biometrics and imaging applications. We recognize revenue from software licenses upon delivery when licenses are sold in single element arrangements. | |||||||||||||
Software maintenance | |||||||||||||
Software maintenance consists of revenue from the sale of software maintenance contracts for biometrics and imaging software. Software maintenance contracts entitle customers to receive software support and software updates, if and when they become available, during the term of the maintenance contract. We recognize software maintenance revenue ratably over the related contract period. | |||||||||||||
Services | |||||||||||||
Service revenue consists of fees from biometrics customers for engineering services we provide to them. We recognize services revenue as services are delivered when services are sold in single element arrangements. | |||||||||||||
Hardware sales | |||||||||||||
Hardware sales consist of sales of biometrics equipment to a single U.S. government customer. We recognize hardware sales upon delivery and acceptance of the equipment by the customer. | |||||||||||||
Royalties | |||||||||||||
Royalty revenue consists of royalties we receive under DSL silicon IP contracts with customers that have incorporated our intellectual property into their products. Since we cannot reasonably estimate royalty revenue, such revenue is recognized in the quarter in which a final report is received from a customer. Royalty reports are typically received in the quarter immediately following the quarter in which sales of royalty-bearing products occur. | |||||||||||||
Multiple element arrangements | |||||||||||||
In addition to selling software licenses, software maintenance and services in single element arrangements, we also sell these three products and hardware as part of multiple element arrangements. The various combinations of multiple element arrangements and our revenue recognition for each are described as follows: | |||||||||||||
● | Software licenses and software maintenance. When software licenses and software maintenance contracts are sold together, we recognize software license revenue upon delivery, provided we have vendor specific objective evidence (“VSOE”) for the fair value of the maintenance contract fee, and we recognize the fair value of maintenance contract revenue ratably over the related contract period. | ||||||||||||
● | Software licenses and services. When software licenses and engineering services are sold together, the total fee is generally recognized by applying contract accounting. We have adopted the percentage-of-completion method of contract accounting, and we generally use an input method (i.e., labor hours) to determine our completion percentage. The software license portion of the arrangement is classified as software license revenue and the engineering services portion is classified as services revenue. | ||||||||||||
● | Software licenses, software maintenance and services. When we sell software licenses, software maintenance and services together, revenue is recognized as follows: i) software maintenance revenue is separated from the other two elements and is recognized ratably over the related software maintenance contract period; provided we have VSOE for the fair value of the maintenance element; and ii) the total fee from the software license and engineering service elements is recognized by applying the contract accounting method described in the previous paragraph. | ||||||||||||
● | Hardware sales, software maintenance, and services. We have a multiple element arrangement with one customer that involves the delivery of hardware, maintenance, and services. We determined that these elements qualified as separate units of accounting because they have value to the customer on a standalone basis. We recognize revenue from this arrangement as follows: i) hardware revenue is recognized upon delivery and acceptance of the equipment by the customer; ii) maintenance revenue is recognized ratably over the related contract period; and iii) service revenue is recognized as services are delivered. | ||||||||||||
Income Taxes – We compute deferred income taxes based on the differences between the financial statement and tax basis of assets and liabilities using enacted rates in effect in the years in which the differences are expected to reverse. We establish a valuation allowance to offset temporary deductible differences, net operating loss carryforwards and tax credits when it is more likely than not that the deferred tax assets will not be realized. | |||||||||||||
We recognize the tax benefit from an uncertain tax position only if it is more-likely-than-not that the tax position will be sustained upon examination by the taxing authorities, based on the technical merits of the tax position. The evaluation of an uncertain tax position is based on factors that include, but are not limited to, changes in the tax law, the measurement of tax positions taken or expected to be taken in tax returns, the effective settlement of matters subject to audit, and changes in facts or circumstances related to a tax position. Any changes to these estimates, based on the actual results obtained and/or a change in assumptions, could impact our tax provision in future periods. Interest and penalty charges, if any, related to unrecognized tax benefits would be classified as a provision for income tax in the statement of income. | |||||||||||||
Capitalization of Software Costs – We capitalize certain internally developed software development costs after technological feasibility of the product has been established. No software costs were capitalized for the years ended December 31, 2013, 2012 and 2011, because such costs incurred subsequent to the establishment of technological feasibility, but prior to commercial availability, were immaterial. | |||||||||||||
Research and Development Costs – Costs incurred in the research and development of our products are expensed as incurred. | |||||||||||||
Concentration of Credit Risk – At December 31, 2013 and 2012, we had cash and cash equivalents, in excess of federally insured deposit limits of approximately $72.4 million and $70.8 million, respectively. | |||||||||||||
Concentration of credit risk with respect to net accounts receivable consisted of $2.7 million, $0.2 million, $0.2 million, $0.2 million and $0.2 million with five customers, respectively, at December 31, 2013, and $1.1 million, $0.6 million, $0.5 million, $0.4 million and $0.3 million with five customers, respectively, at December 31, 2012. | |||||||||||||
Concentration of credit risk with respect to our investment portfolio consisted of $0.8 million, $0.5 million, $0.5 million, $0.5 million, and $0.4 million with five issuers of corporate debt securities, respectively, at December 31, 2013, and $1.0 million and $1.0 million with two issuers of corporate debt securities, respectively, at December 31, 2012. | |||||||||||||
Stock-Based Compensation – We grant stock options and stock to our employees and directors. We measure stock-based compensation cost at the grant date based on the fair value of the award and recognize stock-based compensation expense on a straight-line basis over the requisite service period of the award. | |||||||||||||
We use the Black-Scholes option valuation model to estimate the fair value of stock option awards. This valuation model takes into account the exercise price of the award, as well as a variety of significant assumptions. The assumptions used to estimate the fair value of stock options include the expected term, the expected volatility of our stock over the expected term, the risk-free interest rate over the expected term, and our expected annual dividend yield. | |||||||||||||
For stock awards, we determine the fair value of the award by using the fair market value of our stock on the date of grant; provided the number of shares in the grant is fixed on the grant date. | |||||||||||||
Computation of Earnings per Share – Basic earnings per share is computed by dividing income available to common shareholders by the weighted average number of common shares outstanding. Diluted earnings per share is computed by dividing income available to common shareholders by the weighted average number of common shares outstanding plus additional common shares that would have been outstanding if dilutive potential common shares had been issued. For the purposes of this calculation, stock options are considered common stock equivalents in periods in which they have a dilutive effect. Stock options that are antidilutive are excluded from the calculation. | |||||||||||||
Fair Value of Financial Instruments – The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and accrued expenses approximate fair value because of their short-term nature. The carrying amount of investments is based on the fair value of the individual securities in our investment portfolio. | |||||||||||||
Advertising Costs – Advertising costs are expensed as incurred and were not material for 2013, 2012, and 2011. | |||||||||||||
Recent Accounting Pronouncements – There were no recently issued accounting pronouncements applicable to us that we had not adopted as of December 31, 2013. | |||||||||||||
Reclassifications - Certain prior period amounts have been reclassified to be consistent with the current period presentation, particularly as a result of the discontinued operations presentation of our DSL service assurance business. See Note 4 to the Consolidated Financial Statements. | |||||||||||||
Segments – Following the shutdown of our DSL Service Assurance Segment as described in Note 4, we organize ourselves into a single segment reporting to the chief operating decision makers. We have sales outside of the United States, which are described in Note 10. All long-lived assets are maintained in the United States. |
PATENT_RELATED_INCOME
PATENT RELATED INCOME | 12 Months Ended | |
Dec. 31, 2013 | ||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |
PATENT RELATED INCOME | ' | |
3 | PATENT RELATED INCOME | |
In the years ended December 31, 2013 and 2012, we derived patent related income from two sources, which are described below: | ||
Gain on sale of patent assets. In 2011, we engaged an intellectual property law firm to help us conduct a process to sell a portion of our patent portfolio pertaining to wireless and certain DSL patents. The process produced two significant patent sales for a total of $86.4 million of net gains in the year ended December 31, 2012. This income was included on a separate line of the consolidated statements of income and comprehensive income entitled “Gain on sale of patent assets.” The two patent sales are described below: | ||
Wireless patent sale. On April 26, 2012, we entered into an agreement with an unaffiliated third party to sell a portion of our patent portfolio pertaining to wireless technology for $75.0 million. The proceeds from the sale were reduced by $3.8 million of transaction costs, which consisted primarily of fees from the law firm that assisted us in the sale. The transaction closed in June 2012 and resulted in a gain of $71.2 million. | ||
DSL patent sale. On August 22, 2012, we entered into an agreement with an unaffiliated third party to sell a portion of our patent portfolio pertaining to digital subscriber line (“DSL”) technology for $16.0 million. The proceeds from the sale were reduced by $0.8 million of transaction costs, which also consisted primarily of fees from the law firm that assisted us in the sale. The transaction closed in September 2012 and resulted in a gain of $15.2 million. | ||
Income from patent arrangement. In December 2010, we entered into an arrangement with an unaffiliated third party under which we assigned patents in return for royalties on proceeds from patent monetization efforts by the third party. In the years ended December 31, 2013 and 2012, we recorded income related to this arrangement of $0.8 million and $1.1 million, respectively. Such income was included on a separate line of the consolidated statements of income and comprehensive income entitled “Income from patent arrangement.” |
DISCONTINUED_OPERATIONS
DISCONTINUED OPERATIONS | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Discontinued Operations and Disposal Groups [Abstract] | ' | ||||||||||||||||
DISCONTINUED OPERATIONS | ' | ||||||||||||||||
4 | DISCONTINUED OPERATIONS | ||||||||||||||||
Our board of directors approved the shutdown of our DSL service assurance hardware and software product lines in 2012 and 2013, respectively. Both product lines were previously components of our DSL Service Assurance Segment. Results from the DSL Service Assurance Segment have been reported as discontinued operations because we no longer have any significant continuing involvement with, or cash flows from, this segment. | |||||||||||||||||
Loss from the discontinued DSL Service Assurance Segment was (in thousands): | |||||||||||||||||
Years ended December 31, | |||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||
Revenue | $ | 3,216 | $ | 5,431 | $ | 8,387 | |||||||||||
Expenses | 5,120 | 5,558 | 9,401 | ||||||||||||||
Loss before income taxes | (1,904 | ) | (127 | ) | (1,014 | ) | |||||||||||
Income tax benefit | (748 | ) | (51 | ) | - | ||||||||||||
Loss from discontinued operations | ($ | 1,156 | ) | ($ | 76 | ) | ($ | 1,014 | ) | ||||||||
The consolidated statements of income and comprehensive income for the years ended December 31, 2012 and 2011 have been reclassified to reflect the effect of discontinued operations as set forth above. | |||||||||||||||||
We incurred one-time costs related to the shutdown of the DSL service assurance hardware and software product lines. Shutdown costs for each product line were: | |||||||||||||||||
DSL service assurance hardware product line. In 2012, we incurred one-time shutdown costs related to the hardware product line of approximately $282,000, the majority of which were severance and employee-related costs. All such costs were incurred, paid, and included in loss from discontinued operations for the year ended December 31, 2012. | |||||||||||||||||
DSL service assurance software product line. In 2013, we incurred one-time shutdown costs related to the software product line of approximately $2.9 million. Such costs comprise: i) $3.7 million of payments to customers to terminate contracts, which were offset by $1.2 million of deferred revenue obligations that were relieved as a result of such contract terminations; ii) $311,000 of severance and employee-related costs; and iii) $48,000 of asset write-offs. All such costs were incurred and included in loss from discontinued operations for the year ended December 31, 2013. All DSL service assurance software product line exit costs were paid in 2013, with the exception of $90,000 of severance costs, which were paid in early January 2014. | |||||||||||||||||
The following table is a rollforward of our exit costs liability accounts. Unpaid severance and employee-related costs at December 31, 2013 were included in “Accrued compensation” in the consolidated balance sheets. (in thousands): | |||||||||||||||||
Customer | Severance | Other | Total | ||||||||||||||
Contract | and Employee- | Costs | |||||||||||||||
Termination Costs | Related Costs | ||||||||||||||||
Year ended December 31, 2013 | |||||||||||||||||
Balance at January 1, 2013 | $ | - | $ | - | $ | - | $ | - | |||||||||
Amount charged to expense | 2,553 | 311 | 48 | 2,912 | |||||||||||||
Deferred revenue offset | 1,179 | - | - | 1,179 | |||||||||||||
Payments/write-offs | (3,732 | ) | (221 | ) | (48 | ) | (4,001 | ) | |||||||||
Balance at December 31, 2013 | $ | - | $ | 90 | $ | - | $ | 90 | |||||||||
Year ended December 31, 2012 | |||||||||||||||||
Balance at January 1, 2012 | $ | - | $ | - | $ | - | $ | - | |||||||||
Amount charged to expense | - | 282 | - | 282 | |||||||||||||
Payments | - | (282 | ) | - | (282 | ) | |||||||||||
Balance at December 31, 2012 | $ | - | $ | - | $ | - | $ | - | |||||||||
There were no assets or liabilities remaining on the balance sheet as of December 31, 2013 related to the DSL Service Assurance Segment, except for $90,000 of severance costs, which were paid in early January 2014. |
INVENTORIES
INVENTORIES | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Inventory Disclosure [Abstract] | ' | ||||||||
INVENTORIES | ' | ||||||||
5 | INVENTORIES | ||||||||
Inventories consisted of the following at December 31 (in thousands): | |||||||||
2013 | 2012 | ||||||||
Raw materials | $ | 1,584 | $ | - | |||||
Finished goods | 17 | - | |||||||
Total | $ | 1,601 | $ | - |
PROPERTY_AND_EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Property, Plant and Equipment [Abstract] | ' | ||||||||
PROPERTY AND EQUIPMENT | ' | ||||||||
6 | PROPERTY AND EQUIPMENT | ||||||||
Property and equipment consisted of the following at December 31 (in thousands): | |||||||||
2013 | 2012 | ||||||||
Land | $ | 1,056 | $ | 1,080 | |||||
Building and improvements | 9,060 | 9,060 | |||||||
Computer equipment | 557 | 605 | |||||||
Purchased software | 88 | 131 | |||||||
Furniture and fixtures | 778 | 779 | |||||||
Office equipment | 191 | 181 | |||||||
Total | 11,730 | 11,836 | |||||||
Less accumulated depreciation and amortization | (6,148 | ) | (5,932 | ) | |||||
Property and equipment, net | $ | 5,582 | $ | 5,904 | |||||
Depreciation expense was $0.5 million, $0.4 million, and $0.5 million, for the years ended December 31, 2013, 2012, and 2011, respectively. In 2013, 2012 and 2011, we identified $266,000, $958,000, and $78,000, of assets no longer in use, and retired the assets and related accumulated depreciation. |
INCOME_TAXES
INCOME TAXES | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
Income Tax Disclosure [Abstract] | ' | |||||||||||||
INCOME TAXES | ' | |||||||||||||
7. INCOME TAXES | ||||||||||||||
We made provisions for income taxes related to continuing operations in the years ended December 31, 2013 and 2012 of $1.9 million and $20.5 million, respectively. We made no provision for income taxes in the year ended 2011, except for $2,000 of state excise taxes. The components of the provision for income taxes are as follows (in thousands): | ||||||||||||||
Year ended December 31, | ||||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Current: | ||||||||||||||
Federal | $ | 1,000 | $ | 20,654 | $ | - | ||||||||
State | 273 | 1,594 | 2 | |||||||||||
1,273 | 22,248 | 2 | ||||||||||||
Deferred: | ||||||||||||||
Federal | 471 | (1,354 | ) | - | ||||||||||
State | 173 | (407 | ) | - | ||||||||||
644 | (1,761 | ) | - | |||||||||||
Total provision for income taxes | $ | 1,917 | $ | 20,487 | $ | 2 | ||||||||
A reconciliation of the U.S. federal statutory rate to the effective tax rate is as follows: | ||||||||||||||
Year ended December 31, | ||||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Federal statutory rate | 34 | % | 35 | % | 34 | % | ||||||||
State rate, net of federal benefit | 5 | 5 | 6 | |||||||||||
Tax credits | (2 | ) | - | (9 | ) | |||||||||
Permanent adjustments | (1 | ) | - | - | ||||||||||
Change in valuation allowance | - | (18 | ) | (50 | ) | |||||||||
Non-qualified option cancellations and forfeitures | - | - | 11 | |||||||||||
Nondeductible compensation expense | - | - | (1 | ) | ||||||||||
Prior year adjustment | (2 | ) | - | (2 | ) | |||||||||
Expiring NOLs and tax credits | - | - | 10 | |||||||||||
Other | - | - | 1 | |||||||||||
Effective tax rate | 34 | % | 22 | % | 0 | % | ||||||||
Total income tax expense for the year ended December 31, 2013 was $1.2 million, including $1.9 million that was recorded in continuing operations less a tax benefit of $0.7 million that was recorded in discontinued operations. Income tax expense for 2013 was based on the U.S. statutory rate of 34%, increased by state income taxes. Tax expense in 2013 also reflects two items related to 2012, including: | ||||||||||||||
● | a tax benefit of $95,000 related to the 2012 research tax credit. This credit was extended retroactively back to January 1, 2012, by the American Taxpayer Relief Act of 2012, which was enacted on January 2, 2013; and | |||||||||||||
● | a tax benefit of $148,000 related to a reduction in the estimate of the 2012 tax expense recorded in our 2012 financial statements. | |||||||||||||
Total income tax expense for the year ended December 31, 2012 was $20.4 million, including $20.5 million that was recorded in continuing operations less a tax benefit of $51,000 that was recorded in discontinued operations. The Company’s actual tax liability for 2012 was $7.8 million as taxes that were currently payable were reduced by a $14.4 million equity adjustment. This equity adjustment is described more fully below. | ||||||||||||||
In 2012, we used a significant portion of our available deferred tax assets to reduce income taxes on pre-tax income. A substantial portion of the deferred tax assets we utilized comprised cumulative deductions for stock options in excess of book expense. Under income tax accounting rules, the portion of tax benefits attributable to such deductions must be recorded as an adjustment to equity versus a reduction of income tax expense. In the year ended December 31, 2012, the tax benefits from such stock-based awards were $14.4 million, which we recorded as an equity adjustment to additional paid-in capital. | ||||||||||||||
Income tax expense in 2012 was also reduced by a $1.8 million reversal of the valuation allowance on our remaining deferred tax assets at December 31, 2012. We reversed the valuation allowance because based on all the available evidence, we believed that it is more likely than not that our deferred tax assets will be realizable. In reaching this determination, we evaluated: i) our most recent years operating results; ii) our future financial plans; and iii) the nature of the components comprising deferred tax assets at December 31, 2012. | ||||||||||||||
As of December 31, 2013 and 2012, we had deferred tax assets for which we had recorded no valuation allowance. The principal components of deferred tax assets were as follows at December 31 (in thousands): | ||||||||||||||
2013 | 2012 | |||||||||||||
Capitalized research and development costs | $ | 364 | $ | 817 | ||||||||||
Research and development and other tax credit carryforwards | - | 27 | ||||||||||||
Other | 781 | 916 | ||||||||||||
Total | 1,145 | 1,760 | ||||||||||||
Less valuation allowance | (- | ) | (- | ) | ||||||||||
Deferred tax assets, net | $ | 1,145 | $ | 1,760 | ||||||||||
We will continue to assess the level of valuation allowance required in future periods. Should evidence regarding the realizability of tax assets change at a future point in time, the valuation allowance will be adjusted accordingly. | ||||||||||||||
As a result of significant taxable income in 2012 and the utilization of research and development credits thereon, we conducted a review to determine whether any of our prior year research and development tax credits represented an uncertain tax position. Based on that review, we determined that $1.9 million of federal credits and $1.0 million of state credits could not be supported and therefore, those credits were written off. In addition to the write-off, we also determined that $1.9 million of federal credits and $1.0 million of state credits represented an uncertain tax position for which we established a valuation allowance. A rollforward of the uncertain tax position related to our research and development tax credits is as follows (in thousands): | ||||||||||||||
Uncertain tax positions at December 31, 2011 | $ | - | ||||||||||||
Increase due to positions taken in prior periods | 2,945 | |||||||||||||
Uncertain tax positions at December 31, 2012 | $ | 2,945 | ||||||||||||
Increase due to positions taken in prior periods | - | |||||||||||||
Uncertain tax positions at December 31, 2013 | $ | 2,945 | ||||||||||||
Uncertain tax positions of $2.6 million will impact our tax rate if realized. The difference between this amount and the total uncertain tax positions in the table above is the federal tax effect on state tax credits. | ||||||||||||||
In addition to deferred tax assets carried on our balance sheet, we also had net federal and state research and development credit carryforwards available at December 31, 2013 of $4.9 million and $0.7 million. These credits were not recorded as tax assets as they relate to excess stock compensation deductions that may not be recorded as tax assets under generally accepted accounting principles until the amounts have been utilized to reduce our tax liability. To the extent that these assets are used to reduce future taxes, the benefit will be recorded as a reduction to additional paid-in capital. In 2013, we recorded a tax benefit of $128,000 to equity related to the use of these tax credits to reduce our tax liability. | ||||||||||||||
Our policy is to recognize interest and penalties related to uncertain tax positions in income tax expense. As of December 31, 2013, we had no accrued interest or penalties related to uncertain tax positions. | ||||||||||||||
The tax years from 1998 through 2013 are subject to examination by the IRS and state tax authorities. |
EQUITY_AND_STOCK_COMPENSATION_
EQUITY AND STOCK COMPENSATION PLANS | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||
Shareholders Equity and Share Based Payments [Abstract] | ' | ||||||||||||||||||||||||
EQUITY AND STOCK COMPENSATION PLANS | ' | ||||||||||||||||||||||||
8. EQUITY AND STOCK COMPENSATION PLANS | |||||||||||||||||||||||||
Fixed Stock Option Plans – We have two fixed option plans. Under our 1996 Stock Option Plan (“1996 Plan”), we were authorized to grant incentive stock options and nonqualified stock options to our employees and directors for up to 6,100,000 shares of common stock. There were no shares available for grant under the 1996 Plan as of December 31, 2013. Under our 2001 Nonqualified Stock Plan (“2001 Plan”), we are authorized to grant nonqualified stock options, stock appreciation rights and stock awards to our employees and directors for up to 8,000,000 shares of common stock. As of December 31, 2013, there were 4,632,086 shares available for grant under the 2001 Plan. | |||||||||||||||||||||||||
Under both plans, options are granted at exercise prices as determined by the Board of Directors and have terms ranging from four to a maximum of ten years. Our options generally vest over three to five years, although we have granted options in the past that were 50% or fully vested on the date of grant. | |||||||||||||||||||||||||
The following table presents stock-based employee compensation expenses included in our consolidated statements of income and comprehensive income (in thousands): | |||||||||||||||||||||||||
Years ended December 31, | |||||||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||||||
Cost of services | $ | 34 | $ | 16 | $ | 29 | |||||||||||||||||||
Research and development | 81 | 51 | 110 | ||||||||||||||||||||||
Selling and marketing | 14 | 126 | 108 | ||||||||||||||||||||||
General and administrative | 533 | 83 | 859 | ||||||||||||||||||||||
Loss from discontinued operations | - | 45 | 171 | ||||||||||||||||||||||
Stock-based compensation expense | $ | 662 | $ | 321 | $ | 1,277 | |||||||||||||||||||
Stock-based compensation expenses in the preceding table include expenses associated with grants of: i) stock options; ii) stock appreciation rights (SARs); and iii) unrestricted shares of our common stock. The method used to determine stock-based compensation expense for each type of equity grant is described in the following paragraphs. | |||||||||||||||||||||||||
Stock Option and SAR Grants. For the years ended December 31, 2013, 2012, and 2011, we granted stock options for 0, 50,000, and 0 shares, respectively. No SARS were granted during the three year period ended December 31, 2013. We estimate the fair value of stock options and SARs using the Black-Scholes valuation model. | |||||||||||||||||||||||||
The Black-Scholes valuation model takes into account the exercise price of the award, as well as a variety of significant assumptions. The assumptions used to estimate the fair value of stock options and SARs include the expected term, the expected volatility of our stock over the expected term, the risk-free interest rate over the expected term, and our expected annual dividend yield. We believe that the valuation technique and the approach utilized to develop the underlying assumptions are appropriate in calculating the fair values of stock options granted in the year ended December 31, 2012. Estimates of fair value are not intended to predict actual future events or the value ultimately realized by persons who receive equity awards. | |||||||||||||||||||||||||
Specific assumptions used to determine the fair value of options granted during the years ended December 31, 2013, 2012 and 2011, using the Black-Scholes valuation model were: | |||||||||||||||||||||||||
Year Ended | Year Ended | Year Ended | |||||||||||||||||||||||
December 31, | December 31, | December 31, | |||||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||||||
Expected term (1) | n/a | 5 years | n/a | ||||||||||||||||||||||
Expected volatility factor (2) | n/a | 58-63% | n/a | ||||||||||||||||||||||
Risk-free interest rate (3) | n/a | 0.92% | n/a | ||||||||||||||||||||||
Expected annual dividend yield | n/a | n/a | n/a | ||||||||||||||||||||||
(1) The expected term for each grant for the year ended December 31, 2012 was determined based on the contractual term of the option. | |||||||||||||||||||||||||
(2) The expected volatility for each grant is estimated based on an average of historical volatility over a period of time which we believe to be representative of our future volatility. | |||||||||||||||||||||||||
(3) The risk-free interest rate for each grant is based on the U.S. Treasury yield curve in effect at the time of grant for a period equal to the expected term of the stock option. | |||||||||||||||||||||||||
We do not estimate our forfeiture rates as the actual forfeiture rate is known at the end of each reporting period due to the timing of our stock option vesting. | |||||||||||||||||||||||||
Unrestricted Stock Grants. Our 2001 Plan permits us to grant shares of unrestricted stock to our directors, officers and employees. Stock-based compensation expense for stock grants is determined based on the fair market value of our stock on the date of grant; provided the number of shares in the grant is fixed on the grant date. | |||||||||||||||||||||||||
We granted 130,000, 0, and 105,000 shares of unrestricted stock during the years ended December 31, 2013, 2012, and 2011, respectively. The accounting treatment of those awards is described below: | |||||||||||||||||||||||||
Year ended December 31, 2013. In April 2013, we granted 130,000 shares of unrestricted stock to directors, officers and employees. The shares were issued in two equal installments shortly after June 30, 2013 and December 31, 2013. We expensed $623,000 of stock-based compensation expense related to this grant in the year ended December 31, 2013. There was no unamortized stock-based compensation charge associated with this stock grant as of December 31, 2013. | |||||||||||||||||||||||||
We issued shares of common stock related to the April 2013 grant as follows: i) 51,374 net shares of common stock were issued in early July 2013 after employees surrendered 13,626 shares for which we paid $71,000 of withholding taxes on their behalf; and ii) 49,936 net shares of common stock were issued in early January 2014 after employees surrendered 15,064 shares for which we paid $92,000 of withholding taxes on their behalf. | |||||||||||||||||||||||||
Year ended December 31, 2012. No shares of unrestricted stock were granted in 2012, however we granted shares of unrestricted common stock in 2010 that affected results for the year ended December 31, 2012. Activity in 2012 related to the 2010 stock grant was: i) 2012 stock-based compensation expense included $189,000 related to the 2010 grant; and ii) we issued 118,113 net shares of common stock after employees surrendered 33,441 shares for which we paid $174,000 of withholding taxes on their behalf. | |||||||||||||||||||||||||
Year ended December 31, 2011. Our former President and CEO resigned in April 2011. As part of his separation arrangement he was granted 105,000 shares of common stock, which resulted in a stock-based compensation charge of $362,000 in the year ended December 31, 2011. We issued 71,662 net shares of common stock after he surrendered 33,338 shares for which we paid $115,000 of withholding taxes on his behalf. | |||||||||||||||||||||||||
The aforementioned 2010 stock grant also affected results for the year ended December 31, 2011. Activity in 2011 related to the 2010 stock grant was: i) 2011 stock-based compensation expense included $443,000 related to the 2010 grant; and ii) we issued a net of 157,988 shares of common stock after employees surrendered 36,998 shares for which we paid $109,000 of withholding taxes on their behalf. | |||||||||||||||||||||||||
A summary of stock option transactions for our two fixed stock option plans for the years ended December 31, 2013, 2012, and 2011 are presented below: | |||||||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||||||
Weighted | Weighted | Weighted | |||||||||||||||||||||||
Shares | Average | Shares | Average | Shares | Average | ||||||||||||||||||||
Exercise | Exercise | Exercise | |||||||||||||||||||||||
Price | Price | Price | |||||||||||||||||||||||
Outstanding at beginning of year | 1,063,025 | $ | 5.63 | 2,835,952 | $ | 4.42 | 5,082,891 | $ | 4.3 | ||||||||||||||||
Granted | - | - | 50,000 | 4.6 | - | - | |||||||||||||||||||
Exercised | (6,163 | ) | 4.27 | (1,779,616 | ) | 3.71 | (632,685 | ) | 3.02 | ||||||||||||||||
Forfeited or cancelled | (51,873 | ) | 4.83 | (43,311 | ) | 4.33 | (1,614,254 | ) | 4.59 | ||||||||||||||||
Outstanding at end of year | 1,004,989 | $ | 5.68 | 1,063,025 | $ | 5.63 | 2,835,952 | $ | 4.42 | ||||||||||||||||
Exercisable at year end | 986,237 | $ | 5.7 | 1,027,525 | $ | 5.66 | 2,772,109 | $ | 4.44 | ||||||||||||||||
The number of option shares vested and expected to vest at December 31, 2013 was 1,004,989 and those options had a weighted average exercise price of $5.68. | |||||||||||||||||||||||||
No stock options were granted in the years ended December 31, 2013 and 2011. All options granted during the year ended December 31, 2012 had exercise prices equal to the fair market value of our common stock on the date of grant, and the weighted average grant date fair values of options granted were $2.38. | |||||||||||||||||||||||||
At December 31, 2013, the weighted average remaining contractual term for total options outstanding and total options exercisable was approximately 1 year for each. | |||||||||||||||||||||||||
At December 31, 2013, the aggregate intrinsic value of options outstanding and options exercisable was approximately $0.4 million for each. The intrinsic value of a stock option is the amount by which the market value of the underlying stock exceeds the exercise price of the option. The aggregate intrinsic value of options exercised during the year ended December 31, 2013 was approximately $4,000. | |||||||||||||||||||||||||
The following table summarizes the stock options outstanding at December 31, 2013: | |||||||||||||||||||||||||
Options Outstanding | Options Exercisable | ||||||||||||||||||||||||
Exercise Price | Number | Weighted | Weighted Average | Number | Weighted | ||||||||||||||||||||
Range | Average | Remaining | Average | ||||||||||||||||||||||
Exercise | Contractual | Exercise | |||||||||||||||||||||||
Price | Term (in years) | Price | |||||||||||||||||||||||
$0 to $2 | 188 | $ | 1.95 | 0.08 | 188 | $ | 1.95 | ||||||||||||||||||
$2 to $3 | 42,813 | 2.77 | 2.67 | 42,813 | 2.77 | ||||||||||||||||||||
$3 to $4 | 53,000 | 3.45 | 3.63 | 44,666 | 3.52 | ||||||||||||||||||||
$4 to $5 | 58,150 | 4.64 | 3.93 | 58,150 | 4.64 | ||||||||||||||||||||
$5 to $6 | 29,000 | 5.07 | 3.14 | 29,000 | 5.07 | ||||||||||||||||||||
$6 to $7 | 821,838 | 6.07 | 0.75 | 811,420 | 6.07 | ||||||||||||||||||||
1,004,989 | $ | 5.68 | 1.24 | 986,237 | $ | 5.7 | |||||||||||||||||||
At December 31, 2013, unrecognized compensation expense related to non-vested stock options was approximately $46,000, which is expected to be recognized over a weighted average period of 1.0 years. | |||||||||||||||||||||||||
We issue common stock from previously authorized but unissued shares to satisfy option exercises and purchases under our Employee Stock Purchase Plan. | |||||||||||||||||||||||||
Employee Stock Purchase Plan - In June 1996, we adopted an Employee Stock Purchase Plan (the “ESPP Plan”) under which eligible employees could purchase common stock at a price equal to 85% of the lower of the fair market value of the common stock at the beginning or end of each six-month offering period. On November 29, 2005 we amended the ESPP Plan to provide that eligible employees may purchase common stock at a price equal to 95% of the fair market value of the common stock as of the end of each six-month offering period. There is no stock-based compensation expense related to our Employee Stock Purchase Plan because it is not considered a compensatory plan. The plan does not have a look-back feature, and has a minimal discount of 5% of the fair market value of the common stock as of the end of each six-month offering period. Participation in the ESPP Plan is limited to 6% of an employee’s compensation, may be terminated at any time by the employee and automatically ends on termination of employment. A total of 350,000 shares of common stock have been reserved for issuance. As of December 31, 2013 there were 108,959 shares available for future issuance under the ESPP Plan. We issued 7,196, 4,661, and 5,563 common shares under the ESPP Plan in 2013, 2012, and 2011, respectively. | |||||||||||||||||||||||||
Dividends - In April 2012, our board of directors declared a special cash dividend of $1.15 per share. The dividend was paid on May 25, 2012 to shareholders of record as of May 11, 2012. The total amount of the dividend paid was $25.5 million. | |||||||||||||||||||||||||
In November 2012, our board of directors declared a second special cash dividend of $1.80 per share. The dividend was paid on December 17, 2012 to shareholders of record as of December 3, 2012. The total amount of the dividend paid was $40.5 million. | |||||||||||||||||||||||||
Share Repurchases – In July 2011, we purchased 250,000 shares of our common stock at a price of $2.90 per share from a shareholder in a privately negotiated transaction. In addition, we paid a broker commission of 4 cents per share in connection with the transaction. |
COMMITMENTS_AND_CONTINGENT_LIA
COMMITMENTS AND CONTINGENT LIABILITIES | 12 Months Ended | |
Dec. 31, 2013 | ||
Commitments and Contingencies Disclosure [Abstract] | ' | |
COMMITMENTS AND CONTINGENT LIABILITIES | ' | |
9 | COMMITMENTS AND CONTINGENT LIABILITIES | |
Lease Commitments – We own our principal office and research facility in Bedford, Massachusetts, which we have occupied since November 1997. We also conducted a portion of our activities in a leased facility in California in 2011 and 2012. We terminated that lease in September 2012 by making a one-time payment of $15,000. | ||
Rental expense, including the cost of the 2012 termination buyout of the California lease, was approximately $0, $25,000, and $17,000 in 2013, 2012 and 2011, respectively. | ||
Litigation - There are no material pending legal proceedings to which we are a party or to which any of our properties are subject which, either individually or in the aggregate, are expected to have a material adverse effect on our business, financial position or results of operations. | ||
Guarantees and Indemnification Obligations – We enter into agreements in the ordinary course of business that require us: i) to perform under the terms of the contracts, ii) to protect the confidentiality of our customers’ intellectual property, and iii) to indemnify customers, including indemnification against third party claims alleging infringement of intellectual property rights. We also have agreements with each of our directors and executive officers to indemnify such directors or executive officers, to the extent legally permissible, against all liabilities reasonably incurred in connection with any action in which such individual may be involved by reason of such individual being or having been a director or officer of the Company. | ||
Given the nature of the above obligations and agreements, we are unable to make a reasonable estimate of the maximum potential amount that we could be required to pay. Historically, we have not made any significant payments on the above guarantees and indemnifications and no amount has been accrued in the accompanying consolidated financial statements with respect to these guarantees and indemnifications. |
BUSINESS_SEGMENTS_AND_MAJOR_CU
BUSINESS SEGMENTS AND MAJOR CUSTOMERS | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Segment Reporting [Abstract] | ' | ||||||||||||
BUSINESS SEGMENTS AND MAJOR CUSTOMERS | ' | ||||||||||||
10. BUSINESS SEGMENTS AND MAJOR CUSTOMERS | |||||||||||||
Upon the shutdown of the DSL Service Assurance Segment in 2013, we organize ourselves into a single segment that reports to the chief operating decision makers. | |||||||||||||
We conduct our operations in the United States and sell our products and services to domestic and international customers. Revenues were generated from the following geographic regions (in thousands): | |||||||||||||
Year ended December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
United States | $ | 13,909 | $ | 12,158 | $ | 12,276 | |||||||
Rest of world | 5,448 | 5,146 | 3,923 | ||||||||||
$ | 19,357 | $ | 17,304 | $ | 16,199 | ||||||||
There were no single foreign countries from which we derived 10% or more of total revenue in the years ended December 31, 2013, 2012, and 2011. | |||||||||||||
The portion of total revenue that was derived from major customers was as follows: | |||||||||||||
Year ended December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Customer A | 21 | % | 5 | % | 10 | % |
EMPLOYEE_BENEFIT_PLAN
EMPLOYEE BENEFIT PLAN | 12 Months Ended | |
Dec. 31, 2013 | ||
Compensation and Retirement Disclosure [Abstract] | ' | |
EMPLOYEE BENEFIT PLAN | ' | |
11 | EMPLOYEE BENEFIT PLAN | |
In 1994, we established a qualified 401(k) Retirement Plan (the “Plan”) under which employees are allowed to contribute certain percentages of their pay, up to the maximum allowed under Section 401(k) of the Internal Revenue Code. Our contributions to the Plan are at the discretion of the Board of Directors. Our contributions were approximately $189,000, $233,000, and $239,000 in 2013, 2012 and 2011, respectively. |
NET_INCOME_PER_SHARE
NET INCOME PER SHARE | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Earnings Per Share [Abstract] | ' | ||||||||||||
NET INCOME PER SHARE | ' | ||||||||||||
12 | NET INCOME PER SHARE | ||||||||||||
Net income per share is calculated as follows (in thousands, except per share data): | |||||||||||||
Year ended December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Net income: | |||||||||||||
Income from continuing operations | $ | 3,752 | $ | 72,383 | $ | 3,581 | |||||||
Loss from discontinued operations | (1,156 | ) | (76 | ) | (1,014 | ) | |||||||
Net income | $ | 2,596 | $ | 72,307 | $ | 2,567 | |||||||
Shares outstanding: | |||||||||||||
Weighted-average common shares outstanding | 22,543 | 21,814 | 20,534 | ||||||||||
Additional dilutive common stock equivalents | 98 | 257 | 201 | ||||||||||
Diluted shares outstanding | 22,641 | 22,071 | 20,735 | ||||||||||
Basic net income per share: | |||||||||||||
Basic net income per share from continuing operations | $ | 0.17 | $ | 3.32 | $ | 0.17 | |||||||
Basic net loss per share from discontinued operations | (0.05 | ) | (0.00 | ) | (0.05 | ) | |||||||
Basic net income per share | $ | 0.12 | $ | 3.32 | $ | 0.12 | |||||||
Diluted net income per share: | |||||||||||||
Diluted net income per share from continuing operations | $ | 0.16 | $ | 3.28 | $ | 0.17 | |||||||
Diluted net loss per share from discontinued operations | (0.05 | ) | (0.00 | ) | (0.05 | ) | |||||||
Diluted net income per share | $ | 0.11 | $ | 3.28 | $ | 0.12 | |||||||
For the years ended December 31, 2013, 2012 and 2011, options to purchase 823,338, 821,838, and 2,518,914 shares of common stock at weighted average exercise prices of $6.07, $6.07, and $4.62 per share, respectively, were outstanding, but were not included in the computation of diluted EPS because the options’ exercise prices were greater than the average market price of the common shares and thus would be anti-dilutive. |
QUARTERLY_RESULTS_OF_OPERATION
QUARTERLY RESULTS OF OPERATIONS UNAUDITED | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ' | ||||||||||||||||
QUARTERLY RESULTS OF OPERATIONS - UNAUDITED | ' | ||||||||||||||||
12. QUARTERLY RESULTS OF OPERATIONS – UNAUDITED | |||||||||||||||||
The following table is a summary of certain items in the consolidated statements of income and comprehensive income for each of our quarters in the two-year period ended December 31, 2013 (in thousands, except per share data). The impact of the discontinued operations as described in Note 4 is included in all periods. Certain amounts differ from those previously reported on Form 10-Q due to the effect of discontinued operations. | |||||||||||||||||
2013 Quarters Ended | |||||||||||||||||
31-Mar | 30-Jun | 30-Sep | 31-Dec | ||||||||||||||
Revenue | $ | 4,979 | $ | 4,427 | $ | 4,314 | $ | 5,637 | |||||||||
Operating income before patent related income | 2,202 | 543 | 1,039 | 754 | |||||||||||||
Income from patent arrangement | 780 | - | - | - | |||||||||||||
Income from continuing operations | 1,972 | 465 | 790 | 525 | |||||||||||||
Income (loss) from discontinued operations | (115 | ) | (158 | ) | (1,943 | ) | 1,060 | ||||||||||
Net income (loss) | 1,857 | 307 | (1,153 | ) | 1,585 | ||||||||||||
Net income (loss) per share – basic | $ | 0.08 | $ | 0.01 | ($ | 0.05 | ) | $ | 0.07 | ||||||||
Net income (loss) per share – diluted | $ | 0.08 | $ | 0.01 | ($ | 0.05 | ) | $ | 0.07 | ||||||||
2012 Quarters Ended | |||||||||||||||||
31-Mar | 30-Jun | 30-Sep | 31-Dec | ||||||||||||||
Revenue | $ | 4,161 | $ | 3,514 | $ | 4,771 | $ | 4,858 | |||||||||
Operating income before patent related income | 1,120 | 390 | 1,767 | 1,766 | |||||||||||||
Gain on sale of patent assets | - | 71,226 | 15,167 | - | |||||||||||||
Income from patent arrangement | - | - | - | 1,121 | |||||||||||||
Income from continuing operations | 1,167 | 54,938 | 10,272 | 6,006 | |||||||||||||
Income (loss) from discontinued operations | (49 | ) | (12 | ) | 25 | (40 | ) | ||||||||||
Net income | 1,118 | 54,926 | 10,297 | 5,966 | |||||||||||||
Net income per share – basic | $ | 0.05 | $ | 2.52 | $ | 0.46 | $ | 0.27 | |||||||||
Net income per share – diluted | $ | 0.05 | $ | 2.49 | $ | 0.46 | $ | 0.26 | |||||||||
Quarterly amounts may not sum to annual amounts due to rounding and dilution. |
OFFBALANCE_SHEET_ARRANGEMENTS
OFF-BALANCE SHEET ARRANGEMENTS | 12 Months Ended |
Dec. 31, 2013 | |
Off Balance Sheet Arrangements [Abstract] | ' |
OFF-BALANCE SHEET ARRANGEMENTS | ' |
13. OFF-BALANCE SHEET ARRANGEMENTS | |
We do not currently have any arrangements with unconsolidated entities, such as entities often referred to as structured finance, special purpose entities, or variable interest entities which are often established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes. Accordingly, we are not exposed to any financing, liquidity, market or credit risk if we had such relationships. | |
During 2011 and 2012 we disclosed that we had a patent arrangement with an unaffiliated third party that we classified as a variable interest entity. We also disclosed that: i) we had no equity interest in this entity; ii) we were not contractually obligated to fund this entity, therefore our maximum exposure to loss as a result of our involvement with this entity was zero; iii) we may receive royalties in the future if certain conditions are met; iv) we were not the primary beneficiary of this entity; v) we have not consolidated this entity’s results into our financial statements, therefore we carried the assets and liabilities of this entity in our balance sheet at zero; and vi) prior to September 30, 2012, this arrangement had no impact on our results of operations, financial position or cash flows in any previous periods. | |
In August 2012, certain contractual provisions of the arrangement were amended. As a result, the arrangement was no longer considered a variable interest entity under generally accepted accounting principles, and we ceased to classify it as such once the amendment was signed. |
Valuation_and_Qualifying_Accou
Valuation and Qualifying Accounts | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||
Valuation and Qualifying Accounts [Abstract] | ' | ||||||||||||||||||||
Schedule of valuation and qualifying accounts | ' | ||||||||||||||||||||
Schedule II - Valuation and Qualifying Accounts – Years ended December 31, 2013, 2012, and 2011 | |||||||||||||||||||||
(in thousands) | |||||||||||||||||||||
Col. A | Col. B | Col. C(1) | Col. C(2) | Col. D | Col. E | ||||||||||||||||
Additions | |||||||||||||||||||||
Balance at | Charged to | Charged | Deductions | Balance | |||||||||||||||||
Beginning | Costs and | to Other | Charged to | at End | |||||||||||||||||
of Period | Expenses | Accounts | Reserves | of Period | |||||||||||||||||
Allowance for doubtful accounts receivable: | |||||||||||||||||||||
2013 | $ | 20 | $ | - | $ | - | $ | - | $ | 20 | |||||||||||
2012 | $ | 30 | $ | - | $ | - | $ | 10 | $ | 20 | |||||||||||
2011 | $ | 30 | $ | - | $ | - | $ | - | $ | 30 | |||||||||||
Inventory reserves: | |||||||||||||||||||||
2013 | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||
2012 | $ | 1,403 | $ | 126 | $ | - | $ | 1,529 | $ | - | |||||||||||
2011 | $ | 989 | $ | 450 | $ | - | $ | 36 | $ | 1,403 | |||||||||||
Warranty reserves: | |||||||||||||||||||||
2013 | $ | 10 | $ | - | $ | - | $ | 10 | $ | - | |||||||||||
2012 | $ | - | $ | 12 | $ | - | $ | 2 | $ | 10 | |||||||||||
2011 | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||
Deferred tax asset valuation allowance: | |||||||||||||||||||||
2013 | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||
2012 | $ | 40,476 | $ | - | $ | - | $ | 40,476 | $ | - | |||||||||||
2011 | $ | 41,759 | $ | - | ($ | 1,283 | ) | $ | - | $ | 40,476 |
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||
Basis of Presentation | ' | ||||||||||||
Basis of Presentation - The consolidated financial statements include the accounts of Aware, Inc. and its subsidiary. All significant intercompany transactions have been eliminated. | |||||||||||||
Use of Estimates | ' | ||||||||||||
Use of Estimates – The preparation of our financial statements in conformity with accounting principles generally accepted in the United States of America requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. The most significant estimates included in the financial statements pertain to revenue recognition, reserves for doubtful accounts, useful lives of fixed assets, valuation allowance for deferred income tax assets, and accrued liabilities. Actual results could differ from those estimates. | |||||||||||||
Fair Value Measurements | ' | ||||||||||||
Fair Value Measurements - The Financial Accounting Standards Board (“FASB”) Codification defines fair value, and establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to the unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurements) and the lowest priority to unobservable inputs (level 3 measurements). The three levels of the fair value hierarchy under the FASB Codification are: i) Level 1 – valuations that are based on quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date; ii) Level 2 – valuations that are based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly; and iii) Level 3 – valuations that require inputs that are both significant to the fair value measurement and unobservable. | |||||||||||||
Cash and cash equivalents, which primarily include money market mutual funds, were $72.7 million and $71.1 million as of December 31, 2013 and December 31, 2012, respectively. We classified our cash equivalents of $68.6 million and $67.1 million as of December 31, 2013 and 2012, respectively, within Level 1 of the fair value hierarchy because they are valued using quoted market prices. | |||||||||||||
Our investments, which consist of high yield corporate debt securities, are also classified within Level 1 of the fair value hierarchy because they are valued using quoted market prices. We categorize our investments as available-for-sale securities, and carry them at fair value in our financial statements. We had $2.8 million and $2.0 million of available-for-sale investments as of December 31, 2013 and December 31, 2012, respectively. | |||||||||||||
As of December 31, 2013, our assets that are measured at fair value on a recurring basis and whose carrying values approximate their respective fair values include the following (in thousands): | |||||||||||||
Fair Value Measurement at December 31, 2013 Using: | |||||||||||||
Quoted Prices in | Significant Other | Significant | |||||||||||
Active Markets for | Observable Inputs | Unobservable | |||||||||||
Identical Assets | Inputs | ||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||
Corporate debt securities | $ | 2,754 | $ | - | $ | - | |||||||
Money market funds (included in cash and cash equivalents) | 68,556 | ||||||||||||
Total | $ | 71,310 | $ | - | $ | - | |||||||
As of December 31, 2012, our assets that are measured at fair value on a recurring basis and whose carrying values approximate their respective fair values include the following (in thousands): | |||||||||||||
Fair Value Measurement at December 31, 2012 Using: | |||||||||||||
Quoted Prices in | Significant Other | Significant | |||||||||||
Active Markets for | Observable Inputs | Unobservable | |||||||||||
Identical Assets | Inputs | ||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||
Corporate debt securities | $ | 2,010 | $ | - | $ | - | |||||||
Money market funds (included in cash and cash equivalents) | 67,050 | ||||||||||||
Total | $ | 69,060 | $ | - | $ | - | |||||||
Cash and Cash Equivalents | ' | ||||||||||||
Cash and Cash Equivalents – Cash and cash equivalents, which consist primarily of money market funds and demand deposits, are stated at fair value. All highly liquid investments purchased with an original maturity of three months or less are considered cash equivalents. Our cash balances exceed the Federal Deposit Insurance Corporation limits. The Company does not believe it is exposed to significant credit risk related to cash and cash equivalents. | |||||||||||||
Investments | ' | ||||||||||||
Investments - At December 31, 2013 and 2012, we categorized all investment securities as available-for-sale, since we may liquidate these investments currently. In calculating realized gains and losses, cost is determined using specific identification. Unrealized gains and losses on available-for-sale securities are excluded from earnings and reported in a separate component of stockholders’ equity called Accumulated Comprehensive Income. | |||||||||||||
Realized gains on investments were $23,000 and $85,000 in the years ended December 31, 2013 and 2012, respectively. There were no realized gains or losses on investments in the year ended December 31, 2011. | |||||||||||||
Unrealized losses on investments were $156,000, $30,000, and $20,000 in the years ended December 31, 2013, 2012, and 2011. | |||||||||||||
The amortized cost of our corporate debt securities was $3.0 million at December 31, 2013. Corporate debt securities comprising investments mature in 2015 to 2018. | |||||||||||||
Allowance for Doubtful Accounts | ' | ||||||||||||
Allowance for Doubtful Accounts – Accounts are charged to the allowance for doubtful accounts as they are deemed uncollectible based on a periodic review of the accounts. | |||||||||||||
Inventories | ' | ||||||||||||
Inventories – Inventories are stated at the lower of cost or net realizable value. Cost is determined by the first-in, first-out (“FIFO”) method. We evaluate all inventories for net realizable value on a quarterly basis, and record provisions for excess and obsolete inventory when required. There was no reserve for excess and obsolete inventory as of December 31, 2013. | |||||||||||||
Property and Equipment | ' | ||||||||||||
Property and Equipment – Property and equipment is stated at cost. Depreciation and amortization of property and equipment is provided using the straight-line method over the estimated useful lives of the assets. Upon retirement or sale, the costs of the assets disposed of and the related accumulated depreciation are removed from the accounts and any resulting gain or loss on disposal is included in the determination of income or loss. Expenditures for repairs and maintenance are charged to expense as incurred. | |||||||||||||
The estimated useful lives of assets used by us are: | |||||||||||||
Building | 30 years | ||||||||||||
Building improvements | 5 to 20 years | ||||||||||||
Furniture and fixtures | 5 years | ||||||||||||
Computer, office & manufacturing equipment | 3 years | ||||||||||||
Purchased software | 3 years | ||||||||||||
Impairment of Long-Lived Assets | ' | ||||||||||||
Impairment of Long-Lived Assets – We review long-lived assets for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable or that the useful lives of these assets are no longer appropriate. Each impairment test is based on a comparison of the undiscounted cash flows estimated to be generated by those assets over their estimated economic life to the related carrying value of those assets to determine if the assets are impaired. If an impairment is indicated, the asset is written down to its estimated fair value. The cash flow estimates used to identify the potential impairment reflect our best estimates using appropriate assumptions and projections at that time. We believe that no significant impairment of our long-lived assets has occurred as of December 31, 2013 and 2012. | |||||||||||||
Revenue Recognition | ' | ||||||||||||
Revenue Recognition – We recognize revenue when there is persuasive evidence of an arrangement, the sales price is fixed or determinable, collection of the related receivable is reasonably assured, and delivery has occurred or services have been rendered. | |||||||||||||
Persuasive evidence of an arrangement: We use contracts signed by both the customer and us or written purchase orders issued by the customer as evidence of an arrangement. | |||||||||||||
Product delivery: We deem delivery to have occurred: (i) upon shipment when products are shipped FOB shipping point, or (ii) upon delivery at a customer’s location when products are shipped FOB destination, or (iii) when software is delivered electronically. If customer acceptance provisions apply, revenue is not recognized until delivery has occurred and we have received such acceptance. If we are required to provide installation services, revenue is not recognized until installation is complete. | |||||||||||||
Fixed or determinable fee: We consider fees to be fixed or determinable if the fee is not subject to refund or adjustment and the payment terms are within normal established practices. If the fee is not fixed or determinable, we recognize the revenue as amounts become due and payable. | |||||||||||||
Collection is deemed probable: We conduct a credit review for significant transactions at the time of the arrangement to determine the credit-worthiness of the customer. Collection is deemed probable if we expect that the customer will pay amounts under the arrangement as payments become due. | |||||||||||||
We categorize revenue as software licenses, software maintenance, services, hardware sales, or royalties. In addition to the general revenue recognition policies described above, specific revenue recognition policies apply to each category of revenue. | |||||||||||||
Software licenses | |||||||||||||
Software licenses consist of revenue from the sale of software licenses for biometrics and imaging applications. We recognize revenue from software licenses upon delivery when licenses are sold in single element arrangements. | |||||||||||||
Software maintenance | |||||||||||||
Software maintenance consists of revenue from the sale of software maintenance contracts for biometrics and imaging software. Software maintenance contracts entitle customers to receive software support and software updates, if and when they become available, during the term of the maintenance contract. We recognize software maintenance revenue ratably over the related contract period. | |||||||||||||
Services | |||||||||||||
Service revenue consists of fees from biometrics customers for engineering services we provide to them. We recognize services revenue as services are delivered when services are sold in single element arrangements. | |||||||||||||
Hardware sales | |||||||||||||
Hardware sales consist of sales of biometrics equipment to a single U.S. government customer. We recognize hardware sales upon delivery and acceptance of the equipment by the customer. | |||||||||||||
Royalties | |||||||||||||
Royalty revenue consists of royalties we receive under DSL silicon IP contracts with customers that have incorporated our intellectual property into their products. Since we cannot reasonably estimate royalty revenue, such revenue is recognized in the quarter in which a final report is received from a customer. Royalty reports are typically received in the quarter immediately following the quarter in which sales of royalty-bearing products occur. | |||||||||||||
Multiple element arrangements | |||||||||||||
In addition to selling software licenses, software maintenance and services in single element arrangements, we also sell these three products and hardware as part of multiple element arrangements. The various combinations of multiple element arrangements and our revenue recognition for each are described as follows: | |||||||||||||
● | Software licenses and software maintenance. When software licenses and software maintenance contracts are sold together, we recognize software license revenue upon delivery, provided we have vendor specific objective evidence (“VSOE”) for the fair value of the maintenance contract fee, and we recognize the fair value of maintenance contract revenue ratably over the related contract period. | ||||||||||||
● | Software licenses and services. When software licenses and engineering services are sold together, the total fee is generally recognized by applying contract accounting. We have adopted the percentage-of-completion method of contract accounting, and we generally use an input method (i.e., labor hours) to determine our completion percentage. The software license portion of the arrangement is classified as software license revenue and the engineering services portion is classified as services revenue. | ||||||||||||
● | Software licenses, software maintenance and services. When we sell software licenses, software maintenance and services together, revenue is recognized as follows: i) software maintenance revenue is separated from the other two elements and is recognized ratably over the related software maintenance contract period; provided we have VSOE for the fair value of the maintenance element; and ii) the total fee from the software license and engineering service elements is recognized by applying the contract accounting method described in the previous paragraph. | ||||||||||||
● | Hardware sales, software maintenance, and services. We have a multiple element arrangement with one customer that involves the delivery of hardware, maintenance, and services. We determined that these elements qualified as separate units of accounting because they have value to the customer on a standalone basis. We recognize revenue from this arrangement as follows: i) hardware revenue is recognized upon delivery and acceptance of the equipment by the customer; ii) maintenance revenue is recognized ratably over the related contract period; and iii) service revenue is recognized as services are delivered. | ||||||||||||
Income Taxes | ' | ||||||||||||
Income Taxes – We compute deferred income taxes based on the differences between the financial statement and tax basis of assets and liabilities using enacted rates in effect in the years in which the differences are expected to reverse. We establish a valuation allowance to offset temporary deductible differences, net operating loss carryforwards and tax credits when it is more likely than not that the deferred tax assets will not be realized. | |||||||||||||
We recognize the tax benefit from an uncertain tax position only if it is more-likely-than-not that the tax position will be sustained upon examination by the taxing authorities, based on the technical merits of the tax position. The evaluation of an uncertain tax position is based on factors that include, but are not limited to, changes in the tax law, the measurement of tax positions taken or expected to be taken in tax returns, the effective settlement of matters subject to audit, and changes in facts or circumstances related to a tax position. Any changes to these estimates, based on the actual results obtained and/or a change in assumptions, could impact our tax provision in future periods. Interest and penalty charges, if any, related to unrecognized tax benefits would be classified as a provision for income tax in the statement of income. | |||||||||||||
Capitalization of Software Costs | ' | ||||||||||||
Capitalization of Software Costs – We capitalize certain internally developed software development costs after technological feasibility of the product has been established. No software costs were capitalized for the years ended December 31, 2013, 2012 and 2011, because such costs incurred subsequent to the establishment of technological feasibility, but prior to commercial availability, were immaterial. | |||||||||||||
Research and Development Costs | ' | ||||||||||||
Research and Development Costs – Costs incurred in the research and development of our products are expensed as incurred. | |||||||||||||
Concentration of Credit Risk | ' | ||||||||||||
Concentration of Credit Risk – At December 31, 2013 and 2012, we had cash and cash equivalents, in excess of federally insured deposit limits of approximately $72.4 million and $70.8 million, respectively. | |||||||||||||
Concentration of credit risk with respect to net accounts receivable consisted of $2.7 million, $0.2 million, $0.2 million, $0.2 million and $0.2 million with five customers, respectively, at December 31, 2013, and $1.1 million, $0.6 million, $0.5 million, $0.4 million and $0.3 million with five customers, respectively, at December 31, 2012. | |||||||||||||
Concentration of credit risk with respect to our investment portfolio consisted of $0.8 million, $0.5 million, $0.5 million, $0.5 million, and $0.4 million with five issuers of corporate debt securities, respectively, at December 31, 2013, and $1.0 million and $1.0 million with two issuers of corporate debt securities, respectively, at December 31, 2012. | |||||||||||||
Stock-Based Compensation | ' | ||||||||||||
Stock-Based Compensation – We grant stock options and stock to our employees and directors. We measure stock-based compensation cost at the grant date based on the fair value of the award and recognize stock-based compensation expense on a straight-line basis over the requisite service period of the award. | |||||||||||||
We use the Black-Scholes option valuation model to estimate the fair value of stock option awards. This valuation model takes into account the exercise price of the award, as well as a variety of significant assumptions. The assumptions used to estimate the fair value of stock options include the expected term, the expected volatility of our stock over the expected term, the risk-free interest rate over the expected term, and our expected annual dividend yield. | |||||||||||||
For stock awards, we determine the fair value of the award by using the fair market value of our stock on the date of grant; provided the number of shares in the grant is fixed on the grant date. | |||||||||||||
Computation of Earnings per Share | ' | ||||||||||||
Computation of Earnings per Share – Basic earnings per share is computed by dividing income available to common shareholders by the weighted average number of common shares outstanding. Diluted earnings per share is computed by dividing income available to common shareholders by the weighted average number of common shares outstanding plus additional common shares that would have been outstanding if dilutive potential common shares had been issued. For the purposes of this calculation, stock options are considered common stock equivalents in periods in which they have a dilutive effect. Stock options that are antidilutive are excluded from the calculation. | |||||||||||||
Fair Value of Financial Instruments | ' | ||||||||||||
Fair Value of Financial Instruments – The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and accrued expenses approximate fair value because of their short-term nature. The carrying amount of investments is based on the fair value of the individual securities in our investment portfolio. | |||||||||||||
Advertising Costs | ' | ||||||||||||
Advertising Costs – Advertising costs are expensed as incurred and were not material for 2013, 2012, and 2011. | |||||||||||||
Recent Accounting Pronouncements | ' | ||||||||||||
Recent Accounting Pronouncements – There were no recently issued accounting pronouncements applicable to us that we had not adopted as of December 31, 2013. | |||||||||||||
Reclassifications | ' | ||||||||||||
Reclassifications - Certain prior period amounts have been reclassified to be consistent with the current period presentation, particularly as a result of the discontinued operations presentation of our DSL service assurance business. See Note 4 to the Consolidated Financial Statements. | |||||||||||||
Segments | ' | ||||||||||||
Segments – Following the shutdown of our DSL Service Assurance Segment as described in Note 4, we organize ourselves into a single segment reporting to the chief operating decision makers. We have sales outside of the United States, which are described in Note 10. All long-lived assets are maintained in the United States. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||
Schedule of assets measured at fair value on a recurring basis | ' | ||||||||||||
Fair Value Measurement at December 31, 2013 Using: | |||||||||||||
Quoted Prices in | Significant Other | Significant | |||||||||||
Active Markets for | Observable Inputs | Unobservable | |||||||||||
Identical Assets | Inputs | ||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||
Corporate debt securities | $ | 2,754 | $ | - | $ | - | |||||||
Money market funds (included in cash and cash equivalents) | 68,556 | ||||||||||||
Total | $ | 71,310 | $ | - | $ | - | |||||||
Fair Value Measurement at December 31, 2012 Using: | |||||||||||||
Quoted Prices in | Significant Other | Significant | |||||||||||
Active Markets for | Observable Inputs | Unobservable | |||||||||||
Identical Assets | Inputs | ||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||
Corporate debt securities | $ | 2,010 | $ | - | $ | - | |||||||
Money market funds (included in cash and cash equivalents) | 67,050 | ||||||||||||
Total | $ | 69,060 | $ | - | $ | - | |||||||
Schedule of estimated useful lives assets | ' | ||||||||||||
Building | 30 years | ||||||||||||
Building improvements | 5 to 20 years | ||||||||||||
Furniture and fixtures | 5 years | ||||||||||||
Computer, office & manufacturing equipment | 3 years | ||||||||||||
Purchased software | 3 years |
DISCONTINUED_OPERATIONS_Tables
DISCONTINUED OPERATIONS (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Discontinued Operations and Disposal Groups [Abstract] | ' | ||||||||||||||||
Schedule of income (loss) from discontinued operations attributable to the DSL service assurance segment | ' | ||||||||||||||||
Years ended December 31, | |||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||
Revenue | $ | 3,216 | $ | 5,431 | $ | 8,387 | |||||||||||
Expenses | 5,120 | 5,558 | 9,401 | ||||||||||||||
Loss before income taxes | (1,904 | ) | (127 | ) | (1,014 | ) | |||||||||||
Income tax benefit | (748 | ) | (51 | ) | - | ||||||||||||
Loss from discontinued operations | ($ | 1,156 | ) | ($ | 76 | ) | ($ | 1,014 | ) | ||||||||
Schedule of rollforward of the exit costs liability accounts | ' | ||||||||||||||||
Customer | Severance | Other | Total | ||||||||||||||
Contract | and Employee- | Costs | |||||||||||||||
Termination Costs | Related Costs | ||||||||||||||||
Year ended December 31, 2013 | |||||||||||||||||
Balance at January 1, 2013 | $ | - | $ | - | $ | - | $ | - | |||||||||
Amount charged to expense | 2,553 | 311 | 48 | 2,912 | |||||||||||||
Deferred revenue offset | 1,179 | - | - | 1,179 | |||||||||||||
Payments/write-offs | (3,732 | ) | (221 | ) | (48 | ) | (4,001 | ) | |||||||||
Balance at December 31, 2013 | $ | - | $ | 90 | $ | - | $ | 90 | |||||||||
Year ended December 31, 2012 | |||||||||||||||||
Balance at January 1, 2012 | $ | - | $ | - | $ | - | $ | - | |||||||||
Amount charged to expense | - | 282 | - | 282 | |||||||||||||
Payments | - | (282 | ) | - | (282 | ) | |||||||||||
Balance at December 31, 2012 | $ | - | $ | - | $ | - | $ | - |
INVENTORIES_Tables
INVENTORIES (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Inventory Disclosure [Abstract] | ' | ||||||||
Schedule of inventories | ' | ||||||||
2013 | 2012 | ||||||||
Raw materials | $ | 1,584 | $ | - | |||||
Finished goods | 17 | - | |||||||
Total | $ | 1,601 | $ | - |
PROPERTY_AND_EQUIPMENT_Tables
PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Property, Plant and Equipment [Abstract] | ' | ||||||||
Schedule of property and equipment | ' | ||||||||
2013 | 2012 | ||||||||
Land | $ | 1,056 | $ | 1,080 | |||||
Building and improvements | 9,060 | 9,060 | |||||||
Computer equipment | 557 | 605 | |||||||
Purchased software | 88 | 131 | |||||||
Furniture and fixtures | 778 | 779 | |||||||
Office equipment | 191 | 181 | |||||||
Total | 11,730 | 11,836 | |||||||
Less accumulated depreciation and amortization | (6,148 | ) | (5,932 | ) | |||||
Property and equipment, net | $ | 5,582 | $ | 5,904 |
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Income Tax Disclosure [Abstract] | ' | ||||||||||||
Schedule of components of the provision for income taxes | ' | ||||||||||||
Year ended December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Current: | |||||||||||||
Federal | $ | 1,000 | $ | 20,654 | $ | - | |||||||
State | 273 | 1,594 | 2 | ||||||||||
1,273 | 22,248 | 2 | |||||||||||
Deferred: | |||||||||||||
Federal | 471 | (1,354 | ) | - | |||||||||
State | 173 | (407 | ) | - | |||||||||
644 | (1,761 | ) | - | ||||||||||
Total provision for income taxes | $ | 1,917 | $ | 20,487 | $ | 2 | |||||||
Schedule of reconciliation of the U.S. federal statutory rate to the effective tax rate | ' | ||||||||||||
Year ended December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Federal statutory rate | 34 | % | 35 | % | 34 | % | |||||||
State rate, net of federal benefit | 5 | 5 | 6 | ||||||||||
Tax credits | (2 | ) | - | (9 | ) | ||||||||
Permanent adjustments | (1 | ) | - | - | |||||||||
Change in valuation allowance | - | (18 | ) | (50 | ) | ||||||||
Non-qualified option cancellations and forfeitures | - | - | 11 | ||||||||||
Nondeductible compensation expense | - | - | (1 | ) | |||||||||
Prior year adjustment | (2 | ) | - | (2 | ) | ||||||||
Expiring NOLs and tax credits | - | - | 10 | ||||||||||
Other | - | - | 1 | ||||||||||
Effective tax rate | 34 | % | 22 | % | 0 | % | |||||||
Schedule of components of deferred tax assets | ' | ||||||||||||
2013 | 2012 | ||||||||||||
Capitalized research and development costs | $ | 364 | $ | 817 | |||||||||
Research and development and other tax credit carryforwards | - | 27 | |||||||||||
Other | 781 | 916 | |||||||||||
Total | 1,145 | 1,760 | |||||||||||
Less valuation allowance | (- | ) | (- | ) | |||||||||
Deferred tax assets, net | $ | 1,145 | $ | 1,760 | |||||||||
Schedule of rollforward of the uncertain tax position related to research and development tax credits | ' | ||||||||||||
Uncertain tax positions at December 31, 2011 | $ | - | |||||||||||
Increase due to positions taken in prior periods | 2,945 | ||||||||||||
Uncertain tax positions at December 31, 2012 | $ | 2,945 | |||||||||||
Increase due to positions taken in prior periods | - | ||||||||||||
Uncertain tax positions at December 31, 2013 | $ | 2,945 |
EQUITY_AND_STOCK_COMPENSATION_1
EQUITY AND STOCK COMPENSATION PLANS (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||
Shareholders Equity and Share Based Payments [Abstract] | ' | ||||||||||||||||||||||||
Schedule of stock-based employee compensation expense included in consolidated statements of income and comprehensive income | ' | ||||||||||||||||||||||||
Years ended December 31, | |||||||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||||||
Cost of services | $ | 34 | $ | 16 | $ | 29 | |||||||||||||||||||
Research and development | 81 | 51 | 110 | ||||||||||||||||||||||
Selling and marketing | 14 | 126 | 108 | ||||||||||||||||||||||
General and administrative | 533 | 83 | 859 | ||||||||||||||||||||||
Loss from discontinued operations | - | 45 | 171 | ||||||||||||||||||||||
Stock-based compensation expense | $ | 662 | $ | 321 | $ | 1,277 | |||||||||||||||||||
Schedule of assumption used to determine the fair value of options granted | ' | ||||||||||||||||||||||||
Year Ended | Year Ended | Year Ended | |||||||||||||||||||||||
December 31, | December 31, | December 31, | |||||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||||||
Expected term (1) | n/a | 5 years | n/a | ||||||||||||||||||||||
Expected volatility factor (2) | n/a | 58-63% | n/a | ||||||||||||||||||||||
Risk-free interest rate (3) | n/a | 0.92% | n/a | ||||||||||||||||||||||
Expected annual dividend yield | n/a | n/a | n/a | ||||||||||||||||||||||
(1) The expected term for each grant for the year ended December 31, 2012 was determined based on the contractual term of the option. | |||||||||||||||||||||||||
(2) The expected volatility for each grant is estimated based on an average of historical volatility over a period of time which we believe to be representative of our future volatility. | |||||||||||||||||||||||||
(3) The risk-free interest rate for each grant is based on the U.S. Treasury yield curve in effect at the time of grant for a period equal to the expected term of the stock option. | |||||||||||||||||||||||||
Schedule of the summary of stock option transactions for two fixed stock option plans | ' | ||||||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||||||
Weighted | Weighted | Weighted | |||||||||||||||||||||||
Shares | Average | Shares | Average | Shares | Average | ||||||||||||||||||||
Exercise | Exercise | Exercise | |||||||||||||||||||||||
Price | Price | Price | |||||||||||||||||||||||
Outstanding at beginning of year | 1,063,025 | $ | 5.63 | 2,835,952 | $ | 4.42 | 5,082,891 | $ | 4.3 | ||||||||||||||||
Granted | - | - | 50,000 | 4.6 | - | - | |||||||||||||||||||
Exercised | (6,163 | ) | 4.27 | (1,779,616 | ) | 3.71 | (632,685 | ) | 3.02 | ||||||||||||||||
Forfeited or cancelled | (51,873 | ) | 4.83 | (43,311 | ) | 4.33 | (1,614,254 | ) | 4.59 | ||||||||||||||||
Outstanding at end of year | 1,004,989 | $ | 5.68 | 1,063,025 | $ | 5.63 | 2,835,952 | $ | 4.42 | ||||||||||||||||
Exercisable at year end | 986,237 | $ | 5.7 | 1,027,525 | $ | 5.66 | 2,772,109 | $ | 4.44 | ||||||||||||||||
Schedule of the summary of stock options outstanding | ' | ||||||||||||||||||||||||
Options Outstanding | Options Exercisable | ||||||||||||||||||||||||
Exercise Price | Number | Weighted | Weighted Average | Number | Weighted | ||||||||||||||||||||
Range | Average | Remaining | Average | ||||||||||||||||||||||
Exercise | Contractual | Exercise | |||||||||||||||||||||||
Price | Term (in years) | Price | |||||||||||||||||||||||
$0 to $2 | 188 | $ | 1.95 | 0.08 | 188 | $ | 1.95 | ||||||||||||||||||
$2 to $3 | 42,813 | 2.77 | 2.67 | 42,813 | 2.77 | ||||||||||||||||||||
$3 to $4 | 53,000 | 3.45 | 3.63 | 44,666 | 3.52 | ||||||||||||||||||||
$4 to $5 | 58,150 | 4.64 | 3.93 | 58,150 | 4.64 | ||||||||||||||||||||
$5 to $6 | 29,000 | 5.07 | 3.14 | 29,000 | 5.07 | ||||||||||||||||||||
$6 to $7 | 821,838 | 6.07 | 0.75 | 811,420 | 6.07 | ||||||||||||||||||||
1,004,989 | $ | 5.68 | 1.24 | 986,237 | $ | 5.7 |
BUSINESS_SEGMENTS_AND_MAJOR_CU1
BUSINESS SEGMENTS AND MAJOR CUSTOMERS (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Segment Reporting [Abstract] | ' | ||||||||||||
Schedule of revenues generated from geographic regions | ' | ||||||||||||
Year ended December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
United States | $ | 13,909 | $ | 12,158 | $ | 12,276 | |||||||
Rest of world | 5,448 | 5,146 | 3,923 | ||||||||||
$ | 19,357 | $ | 17,304 | $ | 16,199 | ||||||||
Schedule of total revenue that was derived from major customers | ' | ||||||||||||
Year ended December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Customer A | 21 | % | 5 | % | 10 | % |
NET_INCOME_PER_SHARE_Tables
NET INCOME PER SHARE (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Earnings Per Share [Abstract] | ' | ||||||||||||
Schedule of net income per share | ' | ||||||||||||
Year ended December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Net income: | |||||||||||||
Income from continuing operations | $ | 3,752 | $ | 72,383 | $ | 3,581 | |||||||
Loss from discontinued operations | (1,156 | ) | (76 | ) | (1,014 | ) | |||||||
Net income | $ | 2,596 | $ | 72,307 | $ | 2,567 | |||||||
Shares outstanding: | |||||||||||||
Weighted-average common shares outstanding | 22,543 | 21,814 | 20,534 | ||||||||||
Additional dilutive common stock equivalents | 98 | 257 | 201 | ||||||||||
Diluted shares outstanding | 22,641 | 22,071 | 20,735 | ||||||||||
Basic net income per share: | |||||||||||||
Basic net income per share from continuing operations | $ | 0.17 | $ | 3.32 | $ | 0.17 | |||||||
Basic net loss per share from discontinued operations | (0.05 | ) | (0.00 | ) | (0.05 | ) | |||||||
Basic net income per share | $ | 0.12 | $ | 3.32 | $ | 0.12 | |||||||
Diluted net income per share: | |||||||||||||
Diluted net income per share from continuing operations | $ | 0.16 | $ | 3.28 | $ | 0.17 | |||||||
Diluted net loss per share from discontinued operations | (0.05 | ) | (0.00 | ) | (0.05 | ) | |||||||
Diluted net income per share | $ | 0.11 | $ | 3.28 | $ | 0.12 |
QUARTERLY_RESULTS_OF_OPERATION1
QUARTERLY RESULTS OF OPERATIONS UNAUDITED (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ' | ||||||||||||||||
Schedule of quarterly financial information | ' | ||||||||||||||||
2013 Quarters Ended | |||||||||||||||||
31-Mar | 30-Jun | 30-Sep | 31-Dec | ||||||||||||||
Revenue | $ | 4,979 | $ | 4,427 | $ | 4,314 | $ | 5,637 | |||||||||
Operating income before patent related income | 2,202 | 543 | 1,039 | 754 | |||||||||||||
Income from patent arrangement | 780 | - | - | - | |||||||||||||
Income from continuing operations | 1,972 | 465 | 790 | 525 | |||||||||||||
Income (loss) from discontinued operations | (115 | ) | (158 | ) | (1,943 | ) | 1,060 | ||||||||||
Net income (loss) | 1,857 | 307 | (1,153 | ) | 1,585 | ||||||||||||
Net income (loss) per share – basic | $ | 0.08 | $ | 0.01 | ($ | 0.05 | ) | $ | 0.07 | ||||||||
Net income (loss) per share – diluted | $ | 0.08 | $ | 0.01 | ($ | 0.05 | ) | $ | 0.07 | ||||||||
2012 Quarters Ended | |||||||||||||||||
31-Mar | 30-Jun | 30-Sep | 31-Dec | ||||||||||||||
Revenue | $ | 4,161 | $ | 3,514 | $ | 4,771 | $ | 4,858 | |||||||||
Operating income before patent related income | 1,120 | 390 | 1,767 | 1,766 | |||||||||||||
Gain on sale of patent assets | - | 71,226 | 15,167 | - | |||||||||||||
Income from patent arrangement | - | - | - | 1,121 | |||||||||||||
Income from continuing operations | 1,167 | 54,938 | 10,272 | 6,006 | |||||||||||||
Income (loss) from discontinued operations | (49 | ) | (12 | ) | 25 | (40 | ) | ||||||||||
Net income | 1,118 | 54,926 | 10,297 | 5,966 | |||||||||||||
Net income per share – basic | $ | 0.05 | $ | 2.52 | $ | 0.46 | $ | 0.27 | |||||||||
Net income per share – diluted | $ | 0.05 | $ | 2.49 | $ | 0.46 | $ | 0.26 |
SUMMARY_OF_SIGNIFICANT_ACCOUNT3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Assets measured at fair value on recurring basis (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Fair Value Measurement, Quoted Prices in Active Markets for Identical Assets (Level 1) | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Investments, stated at fair value | $71,310 | $69,060 |
Corporate debt securities | Fair Value Measurement, Quoted Prices in Active Markets for Identical Assets (Level 1) | Fair value on recurring basis | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Investments, stated at fair value | 2,754 | 2,010 |
Corporate debt securities | Fair Value Measurement, Significant Other Observable Inputs (Level 2) | Fair value on recurring basis | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Investments, stated at fair value | ' | ' |
Corporate debt securities | Fair Value Measurement, Significant Unobservable Inputs (Level 3) | Fair value on recurring basis | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Investments, stated at fair value | ' | ' |
Money market funds (included in cash and cash equivalents) | Fair Value Measurement, Quoted Prices in Active Markets for Identical Assets (Level 1) | Fair value on recurring basis | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Investments, stated at fair value | 68,556 | 67,050 |
Money market funds (included in cash and cash equivalents) | Fair Value Measurement, Significant Other Observable Inputs (Level 2) | Fair value on recurring basis | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Investments, stated at fair value | ' | ' |
Money market funds (included in cash and cash equivalents) | Fair Value Measurement, Significant Unobservable Inputs (Level 3) | Fair value on recurring basis | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Investments, stated at fair value | ' | ' |
SUMMARY_OF_SIGNIFICANT_ACCOUNT4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Estimated useful lives of assets (Details 1) | 12 Months Ended |
Dec. 31, 2013 | |
Building | ' |
Property, Plant and Equipment [Line Items] | ' |
Estimated useful lives of assets | '30 years |
Building improvements | Minimum | ' |
Property, Plant and Equipment [Line Items] | ' |
Estimated useful lives of assets | '5 years |
Building improvements | Maximum | ' |
Property, Plant and Equipment [Line Items] | ' |
Estimated useful lives of assets | '20 years |
Furniture and fixtures | ' |
Property, Plant and Equipment [Line Items] | ' |
Estimated useful lives of assets | '5 years |
Computer, office & manufacturing equipment | ' |
Property, Plant and Equipment [Line Items] | ' |
Estimated useful lives of assets | '3 years |
Purchased software | ' |
Property, Plant and Equipment [Line Items] | ' |
Estimated useful lives of assets | '3 years |
SUMMARY_OF_SIGNIFICANT_ACCOUNT5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Detail Textuals) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
In Thousands, unless otherwise specified | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' |
Cash equivalents, which primarily include money market funds | $72,660 | $71,074 | $46,577 | $39,949 |
Fair Value Measurement, Quoted Prices in Active Markets for Identical Assets (Level 1) | ' | ' | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' |
Available-for-sale securities fair value | 71,310 | 69,060 | ' | ' |
Cash equivalents, which primarily include money market funds | 68,556 | 67,050 | ' | ' |
Fair value on recurring basis | Corporate debt securities | Fair Value Measurement, Quoted Prices in Active Markets for Identical Assets (Level 1) | ' | ' | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' |
Available-for-sale securities fair value | $2,754 | $2,010 | ' | ' |
SUMMARY_OF_SIGNIFICANT_ACCOUNT6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Detail Textuals 1) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Accounting Policies [Abstract] | ' | ' | ' |
Realized gains on investments | $23,000 | $85,000 | ' |
Unrealized losses on investments | -156,000 | -30,000 | -20,000 |
Cash and cash equivalents, in excess of federally insured deposit limits | $72,400,000 | $70,800,000 | ' |
SUMMARY_OF_SIGNIFICANT_ACCOUNT7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Detail Textuals 2) (Corporate debt securities, USD $) | Dec. 31, 2013 |
In Millions, unless otherwise specified | |
Corporate debt securities | ' |
Schedule of Available-for-sale Securities [Line Items] | ' |
Amortized cost corporate debt securities | $3 |
SUMMARY_OF_SIGNIFICANT_ACCOUNT8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Detail Textuals 3) (Accounts Receivable, Credit Concentration Risk, USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Customer | Customer | |
Concentration Risk [Line Items] | ' | ' |
Number of major customers | 5 | 5 |
Customer One | ' | ' |
Concentration Risk [Line Items] | ' | ' |
Concentration of risk, Amount | 2.7 | 1.1 |
Customer Two | ' | ' |
Concentration Risk [Line Items] | ' | ' |
Concentration of risk, Amount | 0.2 | 0.6 |
Customer Three | ' | ' |
Concentration Risk [Line Items] | ' | ' |
Concentration of risk, Amount | 0.2 | 0.5 |
Customer Four | ' | ' |
Concentration Risk [Line Items] | ' | ' |
Concentration of risk, Amount | 0.2 | 0.4 |
Customer Five | ' | ' |
Concentration Risk [Line Items] | ' | ' |
Concentration of risk, Amount | 0.2 | 0.3 |
SUMMARY_OF_SIGNIFICANT_ACCOUNT9
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Detail Textuals 4) (Investment Portfolio, Credit Concentration Risk, Corporate debt securities, USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Issuer | Issuer | |
Concentration Risk [Line Items] | ' | ' |
Number of issuer | 5 | 2 |
Issuer One | ' | ' |
Concentration Risk [Line Items] | ' | ' |
Concentration of risk, Amount | 0.8 | 1 |
Issuer Two | ' | ' |
Concentration Risk [Line Items] | ' | ' |
Concentration of risk, Amount | 0.5 | 1 |
Issuer Three | ' | ' |
Concentration Risk [Line Items] | ' | ' |
Concentration of risk, Amount | 0.5 | ' |
Issuer Four | ' | ' |
Concentration Risk [Line Items] | ' | ' |
Concentration of risk, Amount | 0.5 | ' |
Issuer Five | ' | ' |
Concentration Risk [Line Items] | ' | ' |
Concentration of risk, Amount | 0.4 | ' |
PATENT_RELATED_INCOME_Detail_T
PATENT RELATED INCOME (Detail Textuals ) (USD $) | 3 Months Ended | 12 Months Ended | ||||
In Thousands, unless otherwise specified | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
Patent Related Income [Abstract] | ' | ' | ' | ' | ' | ' |
Gain on sale of patent assets | ' | ' | $15,167 | $71,226 | ' | $86,394 |
Income from patent arrangement | $780 | $1,121 | ' | ' | $780 | $1,121 |
PATENT_RELATED_INCOME_Detail_T1
PATENT RELATED INCOME (Detail Textuals 1) (USD $) | 3 Months Ended | 12 Months Ended | 1 Months Ended | 2 Months Ended | 1 Months Ended | ||
Sep. 30, 2012 | Jun. 30, 2012 | Dec. 31, 2012 | Apr. 26, 2012 | Jun. 30, 2012 | Sep. 30, 2012 | Aug. 22, 2012 | |
Wireless patent | Wireless patent | DSL patent | DSL patent | ||||
Finite-Lived Intangible Assets [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Sale of patent | ' | ' | ' | $75,000,000 | ' | ' | $16,000,000 |
Transaction cost | ' | ' | ' | 3,800,000 | ' | ' | 800,000 |
Gain on sale of patent assets | $15,167,000 | $71,226,000 | $86,394,000 | ' | $71,200,000 | $15,200,000 | ' |
DISCONTINUED_OPERATIONS_Income
DISCONTINUED OPERATIONS - Income (loss) from discontinued operations attributable to DSL service (Details) (DSL Service Assurance, USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
DSL Service Assurance | ' | ' | ' |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' | ' |
Revenue | $3,216 | $5,431 | $8,387 |
Expenses | 5,120 | 5,558 | 9,401 |
Loss before income taxes | -1,904 | -127 | -1,014 |
Income tax benefit | -748 | -51 | ' |
Loss from discontinued operations | ($1,156) | ($76) | ($1,014) |
DISCONTINUED_OPERATIONS_exit_c
DISCONTINUED OPERATIONS - exit costs liability accounts (Details 1) (Digital Subscriber Line, Discontinued Operations, USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Restructuring Reserve [Roll Forward] | ' | ' |
Balance | ' | ' |
Amount charged to expense | 2,912 | 282 |
Deferred revenue offset | 1,179 | ' |
Payments/write-offs | -4,001 | 282 |
Balance | 90 | ' |
Contract Termination | ' | ' |
Restructuring Reserve [Roll Forward] | ' | ' |
Balance | ' | ' |
Amount charged to expense | 2,553 | ' |
Deferred revenue offset | 1,179 | ' |
Payments/write-offs | -3,732 | ' |
Balance | ' | ' |
Employee Severance | ' | ' |
Restructuring Reserve [Roll Forward] | ' | ' |
Balance | ' | ' |
Amount charged to expense | 311 | 282 |
Deferred revenue offset | ' | ' |
Payments/write-offs | -221 | -282 |
Balance | 90 | ' |
Other Restructuring | ' | ' |
Restructuring Reserve [Roll Forward] | ' | ' |
Balance | ' | ' |
Amount charged to expense | 48 | ' |
Deferred revenue offset | ' | ' |
Payments/write-offs | -48 | ' |
Balance | ' | ' |
DISCONTINUED_OPERATIONS_Detail
DISCONTINUED OPERATIONS (Detail Textuals) (DSL Service Assurance, USD $) | Dec. 31, 2012 |
In Thousands, unless otherwise specified | |
DSL Service Assurance | ' |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' |
Severance and employee related costs | $282,000 |
DISCONTINUED_OPERATIONS_Detail1
DISCONTINUED OPERATIONS (Detail Textuals 1) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Restructuring Cost and Reserve [Line Items] | ' | ' | ' |
Estimated shutdown cost | $2,900,000 | ' | ' |
Asset write-offs | 48,000 | ' | ' |
Digital Subscriber Line | Discontinued Operations | ' | ' | ' |
Restructuring Cost and Reserve [Line Items] | ' | ' | ' |
Liability for exit costs | 90,000 | ' | ' |
Deferred revenue obligations | 1,179,000 | ' | ' |
Payments/write-offs | -4,001,000 | 282,000 | ' |
Employee Severance And Retention Bonus | ' | ' | ' |
Restructuring Cost and Reserve [Line Items] | ' | ' | ' |
Severance and employee-related costs | 311,000 | ' | ' |
Contract Termination | Digital Subscriber Line | Discontinued Operations | ' | ' | ' |
Restructuring Cost and Reserve [Line Items] | ' | ' | ' |
Liability for exit costs | ' | ' | ' |
Deferred revenue obligations | 1,179,000 | ' | ' |
Payments/write-offs | ($3,732,000) | ' | ' |
INVENTORIES_Summary_of_invento
INVENTORIES - Summary of inventories (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Inventory Disclosure [Abstract] | ' | ' |
Raw materials | $1,584 | ' |
Finished goods | 17 | ' |
Total | $1,601 | ' |
PROPERTY_AND_EQUIPMENT_Summary
PROPERTY AND EQUIPMENT - Summary of property and equipment (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Public Utility, Property, Plant and Equipment [Line Items] | ' | ' |
Total | $11,730 | $11,836 |
Less accumulated depreciation and amortization | -6,148 | -5,932 |
Property and equipment, net | 5,582 | 5,904 |
Land | ' | ' |
Public Utility, Property, Plant and Equipment [Line Items] | ' | ' |
Total | 1,056 | 1,080 |
Building and improvements | ' | ' |
Public Utility, Property, Plant and Equipment [Line Items] | ' | ' |
Total | 9,060 | 9,060 |
Computer equipment | ' | ' |
Public Utility, Property, Plant and Equipment [Line Items] | ' | ' |
Total | 557 | 605 |
Purchased software | ' | ' |
Public Utility, Property, Plant and Equipment [Line Items] | ' | ' |
Total | 88 | 131 |
Furniture and fixtures | ' | ' |
Public Utility, Property, Plant and Equipment [Line Items] | ' | ' |
Total | 778 | 779 |
Office equipment | ' | ' |
Public Utility, Property, Plant and Equipment [Line Items] | ' | ' |
Total | $191 | $181 |
PROPERTY_AND_EQUIPMENT_Detail_
PROPERTY AND EQUIPMENT (Detail Textuals) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Property, Plant and Equipment [Abstract] | ' | ' | ' |
Depreciation expense | $500,000 | $400,000 | $500,000 |
Retired of assets | $266,000 | $958,000 | $78,000 |
INCOME_TAXES_Components_of_pro
INCOME TAXES - Components of provision for income taxes (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Current: | ' | ' | ' |
Federal | $1,000 | $20,654 | ' |
State | 273 | 1,594 | 2 |
Total current tax | 1,273 | 22,248 | 2 |
Deferred: | ' | ' | ' |
Federal | 471 | -1,354 | ' |
State | 173 | -407 | ' |
Total deferred tax | 644 | -1,761 | ' |
Total provision for income taxes | $1,917 | $20,487 | $2 |
INCOME_TAXES_Reconciliation_of
INCOME TAXES - Reconciliation of U.S. federal statutory rate (Details 1) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Income Tax Disclosure [Abstract] | ' | ' | ' |
Federal statutory rate | 34.00% | 35.00% | 34.00% |
State rate, net of federal benefit | 5.00% | 5.00% | 6.00% |
Tax credits | -2.00% | ' | -9.00% |
Permanent adjustments | -1.00% | ' | ' |
Change in valuation allowance | ' | -18.00% | -50.00% |
Non-qualified option cancellations and forfeitures | ' | ' | 11.00% |
Nondeductible compensation expense | ' | ' | -1.00% |
Prior year adjustment | -2.00% | ' | -2.00% |
Expiring NOLs and tax credits | ' | ' | 10.00% |
Other | ' | ' | 1.00% |
Effective tax rate | 34.00% | 22.00% | 0.00% |
INCOME_TAXES_Principal_compone
INCOME TAXES - Principal components of deferred tax assets (Details 2) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Income Tax Disclosure [Abstract] | ' | ' |
Capitalized research and development costs | $364 | $817 |
Research and development and other tax credit carryforwards | ' | 27 |
Other | 781 | 916 |
Total | 1,145 | 1,760 |
Less valuation allowance | ' | ' |
Deferred tax assets, net | $1,145 | $1,760 |
INCOME_TAXES_Rollforward_of_un
INCOME TAXES - Rollforward of uncertain tax position (Details 3) (Research and development tax credits, USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Research and development tax credits | ' | ' |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ' | ' |
Uncertain tax positions | $2,945 | ' |
Increase due to positions taken in prior periods | ' | 2,945 |
Uncertain tax positions | $2,945 | $2,945 |
INCOME_TAXES_Detail_Textuals
INCOME TAXES (Detail Textuals) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Income Tax Disclosure [Abstract] | ' | ' | ' |
Provision for income taxes | $1,917,000 | $20,487,000 | $2,000 |
Income from continuing operations before income taxes | 5,669,000 | 92,870,000 | 3,583,000 |
Tax benefits from stock-based awards | 128,000 | 14,395,000 | ' |
Total income tax expense | 1,200,000 | 20,400,000 | ' |
Income tax expense (benefit) from discontinuing operations | -700,000 | -51,000 | ' |
Actual tax liability | ' | 7,800,000 | ' |
U.S. statutory rate | 34.00% | 35.00% | 34.00% |
Amount of reduction in currently payable of income tax expense | ' | 14,400,000 | ' |
Amount of reduction in income tax expense | ' | 1,800,000 | ' |
Federal credits written off | ' | 1,900,000 | ' |
State credits written off | ' | 1,000,000 | ' |
Uncertain tax positions | 2,600,000 | ' | ' |
Net federal credit carryforwards related to excess stock compensation deductions | 4,900,000 | ' | ' |
State research and development credit carryforwards related to excess stock compensation deductions | 700,000 | ' | ' |
Tax benefit related to research tax credit | 95,000 | ' | ' |
Reduction in estimate tax expense | $148,000 | ' | ' |
EQUITY_AND_STOCK_COMPENSATION_2
EQUITY AND STOCK COMPENSATION PLANS - Stock-based employee compensation expenses (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' |
Stock-based compensation expense | $662,000 | $321,000 | $1,277,000 |
Cost of services | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' |
Stock-based compensation expense | 34,000 | 16,000 | 29,000 |
Research and development | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' |
Stock-based compensation expense | 81,000 | 51,000 | 110,000 |
Selling and marketing | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' |
Stock-based compensation expense | 14,000 | 126,000 | 108,000 |
General and administrative | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' |
Stock-based compensation expense | 533,000 | 83,000 | 859,000 |
Loss from discontinued operations | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' |
Stock-based compensation expense | ' | $45,000 | $171,000 |
EQUITY_AND_STOCK_COMPENSATION_3
EQUITY AND STOCK COMPENSATION PLANS - Assumptions used to determine fair value of options (Details 1) (Stock Options) | 12 Months Ended | |||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | |||
Expected term | ' | '5 years | [1] | ' | ||
Expected volatility factor | ' | [2] | ' | ' | [2] | |
Risk-free interest rate | ' | [3] | 0.92% | [3] | ' | [3] |
Expected annual dividend yield | ' | ' | ' | |||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Method Used | ' | 'Black-Scholes valuation model | ' | |||
Maximum | ' | ' | ' | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | |||
Expected volatility factor | ' | 63.00% | [2] | ' | ||
Minimum | ' | ' | ' | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | |||
Expected volatility factor | ' | 58.00% | [2] | ' | ||
[1] | The expected term for each grant for the year ended December 31, 2012 was determined based on the contractual term of the option. | |||||
[2] | The expected volatility for each grant is estimated based on an average of historical volatility over a period of time which we believe to be representative of our future volatility. | |||||
[3] | The risk-free interest rate for each grant is based on the U.S. Treasury yield curve in effect at the time of grant for a period equal to the expected term of the stock option. |
EQUITY_AND_STOCK_COMPENSATION_4
EQUITY AND STOCK COMPENSATION PLANS - Summary of stock option transactions (Details 2) (Stock Option, USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Stock Option | ' | ' | ' |
Shares | ' | ' | ' |
Outstanding at beginning of year | 1,063,025 | 2,835,952 | 5,082,891 |
Granted | ' | 50,000 | ' |
Exercised | -6,163 | -1,779,616 | -632,685 |
Forfeited or cancelled | -51,873 | -43,311 | -1,614,254 |
Outstanding at end of year | 1,004,989 | 1,063,025 | 2,835,952 |
Exercisable at year end | 986,237 | 1,027,525 | 2,772,109 |
Weighted Average Exercise Price | ' | ' | ' |
Outstanding at beginning of year | $5.63 | $4.42 | $4.30 |
Granted | ' | $4.60 | ' |
Exercised | $4.27 | $3.71 | $3.02 |
Forfeited or cancelled | $4.83 | $4.33 | $4.59 |
Outstanding at end of year | $5.68 | $5.63 | $4.42 |
Exercisable at year end | $5.70 | $5.66 | $4.44 |
EQUITY_AND_STOCK_COMPENSATION_5
EQUITY AND STOCK COMPENSATION PLANS - Summarizes of stock options outstanding (Details 3) (Stock Option, USD $) | 12 Months Ended | |||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' |
Options outstanding, Number | 1,004,989 | 1,063,025 | 2,835,952 | 5,082,891 |
Options outstanding, Weighted average exercise price | $5.68 | $5.63 | $4.42 | $4.30 |
Options outstanding, Weighted average remaining contractual term (in years) | '1 year 2 months 27 days | ' | ' | ' |
Options exercisable, Number | 986,237 | 1,027,525 | 2,772,109 | ' |
Options exercisable, Weighted average exercise price | $5.70 | $5.66 | $4.44 | ' |
Exercise price range $0 to $2 | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' |
Exercise price range (lower) | $0 | ' | ' | ' |
Exercise price range (upper) | $2 | ' | ' | ' |
Options outstanding, Number | 188 | ' | ' | ' |
Options outstanding, Weighted average exercise price | $1.95 | ' | ' | ' |
Options outstanding, Weighted average remaining contractual term (in years) | '29 days | ' | ' | ' |
Options exercisable, Number | 188 | ' | ' | ' |
Options exercisable, Weighted average exercise price | $1.95 | ' | ' | ' |
Exercise price range $2 to $3 | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' |
Exercise price range (lower) | $2 | ' | ' | ' |
Exercise price range (upper) | $3 | ' | ' | ' |
Options outstanding, Number | 42,813 | ' | ' | ' |
Options outstanding, Weighted average exercise price | $2.77 | ' | ' | ' |
Options outstanding, Weighted average remaining contractual term (in years) | '2 years 8 months 1 day | ' | ' | ' |
Options exercisable, Number | 42,813 | ' | ' | ' |
Options exercisable, Weighted average exercise price | $2.77 | ' | ' | ' |
Exercise price range $3 to $4 | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' |
Exercise price range (lower) | $3 | ' | ' | ' |
Exercise price range (upper) | $4 | ' | ' | ' |
Options outstanding, Number | 53,000 | ' | ' | ' |
Options outstanding, Weighted average exercise price | $3.45 | ' | ' | ' |
Options outstanding, Weighted average remaining contractual term (in years) | '3 years 7 months 17 days | ' | ' | ' |
Options exercisable, Number | 44,666 | ' | ' | ' |
Options exercisable, Weighted average exercise price | $3.52 | ' | ' | ' |
Exercise price range $4 to $5 | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' |
Exercise price range (lower) | $4 | ' | ' | ' |
Exercise price range (upper) | $5 | ' | ' | ' |
Options outstanding, Number | 58,150 | ' | ' | ' |
Options outstanding, Weighted average exercise price | $4.64 | ' | ' | ' |
Options outstanding, Weighted average remaining contractual term (in years) | '3 years 11 months 5 days | ' | ' | ' |
Options exercisable, Number | 58,150 | ' | ' | ' |
Options exercisable, Weighted average exercise price | $4.64 | ' | ' | ' |
Exercise price range $5 to $6 | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' |
Exercise price range (lower) | $5 | ' | ' | ' |
Exercise price range (upper) | $6 | ' | ' | ' |
Options outstanding, Number | 29,000 | ' | ' | ' |
Options outstanding, Weighted average exercise price | $5.07 | ' | ' | ' |
Options outstanding, Weighted average remaining contractual term (in years) | '3 years 1 month 21 days | ' | ' | ' |
Options exercisable, Number | 29,000 | ' | ' | ' |
Options exercisable, Weighted average exercise price | $5.07 | ' | ' | ' |
Exercise price range $6 to $7 | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' |
Exercise price range (lower) | $6 | ' | ' | ' |
Exercise price range (upper) | $7 | ' | ' | ' |
Options outstanding, Number | 821,838 | ' | ' | ' |
Options outstanding, Weighted average exercise price | $6.07 | ' | ' | ' |
Options outstanding, Weighted average remaining contractual term (in years) | '9 months | ' | ' | ' |
Options exercisable, Number | 811,420 | ' | ' | ' |
Options exercisable, Weighted average exercise price | $6.07 | ' | ' | ' |
EQUITY_AND_STOCK_COMPENSATION_6
EQUITY AND STOCK COMPENSATION PLANS (Detail Textuals) (Incentive stock options and nonqualified stock options) | 12 Months Ended |
Dec. 31, 2013 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Description of compensation arrangement by share based payment award vesting rights | 'Our options generally vest over three to five years, although we have granted options in the past that were 50% or fully vested on the date of grant. |
Maximum | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Term of options are granted at exercise prices | '10 years |
Term of options vested | '5 years |
Minimum | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Term of options are granted at exercise prices | '4 years |
Term of options vested | '3 years |
Stock Option Plan 1996 | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Number of common stocks authorized to grant | 6,100,000 |
Stock Option Plan 2001 | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Number of common stocks authorized to grant | 8,000,000 |
Number of common stocks available to be issued | 4,632,086 |
EQUITY_AND_STOCK_COMPENSATION_7
EQUITY AND STOCK COMPENSATION PLANS (Detail Textuals 1) (USD $) | 12 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2011 | Jun. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Stock Options | Stock Options | Stock Options | Unrestricted Stock | Unrestricted Stock | Unrestricted Stock | Unrestricted Stock | Unrestricted Stock | Unrestricted Stock | Unrestricted Stock | Unrestricted Stock | Unrestricted Stock | ||||
President and CEO | April 2013 Grant | April 2013 Grant | April 2013 Grant | 2010 stock Grant | 2010 stock Grant | ||||||||||
Directors, Officers and Employees | Directors, Officers and Employees | Directors, Officers and Employees | President and CEO | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number stock issued | ' | ' | ' | 0 | 50,000 | 0 | 130,000 | 0 | 105,000 | 71,662 | 51,374 | 49,936 | 130,000 | 118,113 | 157,988 |
Number of common stock shares surrendered by employees withholding taxes | ' | ' | ' | ' | ' | ' | ' | ' | ' | 33,338 | 13,626 | 15,064 | ' | 33,441 | 36,998 |
Common stock value surrendered by employees withholding taxes | ' | ' | ' | ' | ' | ' | ' | ' | ' | $115,000 | $71,000 | $92,000 | ' | $174,000 | $109,000 |
Stock-based compensation expense | 662,000 | 321,000 | 1,277,000 | ' | ' | ' | ' | ' | ' | 362,000 | ' | ' | 623,000 | 189,000 | 443,000 |
Unrecognized compensation expense | ' | ' | ' | $46,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
EQUITY_AND_STOCK_COMPENSATION_8
EQUITY AND STOCK COMPENSATION PLANS (Detail Textuals 2) (Stock Options, USD $) | 12 Months Ended |
Dec. 31, 2013 | |
Stock Options | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Number of options expected to vest | 1,004,989 |
Weighted average exercise price of options expected to vest | $5.68 |
Weighted average grant date fair values exercise prices | $2.38 |
Weighted average remaining contractual term | '1 year |
Aggregate intrinsic value of options outstanding and exercisable out-of-the money | $400,000 |
Aggregate intrinsic value of options exercised during the year | 4,000 |
Unrecognized compensation expense | $46,000 |
Period for recognized over a weighted average period | '1 year |
EQUITY_AND_STOCK_COMPENSATION_9
EQUITY AND STOCK COMPENSATION PLANS (Detail Textuals 3) (USD $) | 1 Months Ended | 12 Months Ended | ||||||||
In Millions, except Share data, unless otherwise specified | Dec. 17, 2012 | Nov. 30, 2012 | 25-May-12 | Apr. 30, 2012 | Jul. 31, 2011 | Nov. 29, 2005 | Jun. 30, 1996 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Share Repurchases Plan | Employee Stock Purchase Plan | Employee Stock Purchase Plan | Employee Stock Purchase Plan | Employee Stock Purchase Plan | Employee Stock Purchase Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Repurchase of common stock (in shares) | ' | ' | ' | ' | 250,000 | ' | ' | ' | ' | ' |
Common stock price per share (in dollars per share) | ' | ' | ' | ' | $2.90 | ' | ' | ' | ' | ' |
Broker commission per share | ' | ' | ' | ' | $0.04 | ' | ' | ' | ' | ' |
Percentage of common stock at a price lower of the fair market value | ' | ' | ' | ' | ' | 95.00% | 85.00% | ' | ' | ' |
Period of common stock offering | ' | ' | ' | ' | ' | '6 months | '6 months | ' | ' | ' |
Minimal discount of fair market value of the common stock | ' | ' | ' | ' | ' | 5.00% | ' | ' | ' | ' |
Percentage of employee's compensation | ' | ' | ' | ' | ' | 6.00% | ' | ' | ' | ' |
Total Number of common stock Share reserved for issuance | ' | ' | ' | ' | ' | ' | ' | 350,000 | ' | ' |
Number of common stock Share reserved for issuance | ' | ' | ' | ' | ' | ' | ' | 108,959 | ' | ' |
Issuance of common stock under employee stock purchase plan (in shares) | ' | ' | ' | ' | ' | ' | ' | 7,196 | 4,661 | 5,563 |
Special dividends declared per share | ' | $1.80 | ' | $1.15 | ' | ' | ' | ' | ' | ' |
Special cash dividends paid | $40.50 | ' | $25.50 | ' | ' | ' | ' | ' | ' | ' |
COMMITMENTS_AND_CONTINGENT_LIA1
COMMITMENTS AND CONTINGENT LIABILITIES (Detail Textuals) (USD $) | Sep. 30, 2012 |
Commitments and Contingencies Disclosure [Abstract] | ' |
Payment for lease termination | $15,000 |
COMMITMENTS_AND_CONTINGENT_LIA2
COMMITMENTS AND CONTINGENT LIABILITIES (Detail Textuals 1) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Commitments and Contingencies Disclosure [Abstract] | ' | ' | ' |
Rental expense | $0 | $25,000 | $17,000 |
BUSINESS_SEGMENTS_AND_MAJOR_CU2
BUSINESS SEGMENTS AND MAJOR CUSTOMERS - Revenues generated from geographic regions (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenue | $5,637 | $4,314 | $4,427 | $4,979 | $4,858 | $4,771 | $3,514 | $4,161 | $19,357 | $17,304 | $16,199 |
United States | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenue | ' | ' | ' | ' | ' | ' | ' | ' | 13,909 | 12,158 | 12,276 |
Rest of World | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenue | ' | ' | ' | ' | ' | ' | ' | ' | $5,448 | $5,146 | $3,923 |
BUSINESS_SEGMENTS_AND_MAJOR_CU3
BUSINESS SEGMENTS AND MAJOR CUSTOMERS - Revenue derived from major customers (Details 1) (Sales revenue, Customer A) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Sales revenue | Customer A | ' | ' | ' |
Revenue, Major Customer [Line Items] | ' | ' | ' |
Concentration risk, percentage | 21.00% | 5.00% | 10.00% |
EMPLOYEE_BENEFIT_PLAN_Detail_T
EMPLOYEE BENEFIT PLAN (Detail Textuals) (Retirement Plans 401 K Defined Benefit, USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Retirement Plans 401 K Defined Benefit | ' | ' | ' |
Defined Benefit Plan Disclosure [Line Items] | ' | ' | ' |
Contribution by employer | $189,000 | $233,000 | $239,000 |
NET_INCOME_PER_SHARE_Calculati
NET INCOME PER SHARE - Calculation of net income per share (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Net income: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Income from continuing operations | $525 | $790 | $465 | $1,972 | $6,006 | $10,272 | $54,938 | $1,167 | $3,752 | $72,383 | $3,581 |
Loss from discontinued operation | 1,060 | -1,943 | -158 | -115 | -40 | 25 | -12 | -49 | -1,156 | -76 | -1,014 |
Net income | $1,585 | ($1,153) | $307 | $1,857 | $5,966 | $10,297 | $54,926 | $1,118 | $2,596 | $72,307 | $2,567 |
Shares outstanding: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted-average common shares outstanding | ' | ' | ' | ' | ' | ' | ' | ' | 22,543 | 21,814 | 20,534 |
Additional dilutive common stock equivalents | ' | ' | ' | ' | ' | ' | ' | ' | 98 | 257 | 201 |
Diluted shares outstanding | ' | ' | ' | ' | ' | ' | ' | ' | 22,641 | 22,071 | 20,735 |
Basic net income per share: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basic net income per share from continuing operations (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | $0.17 | $3.32 | $0.17 |
Basic net loss per share from discontinued operations (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ($0.05) | $0 | ($0.05) |
Basic net income per share (in dollars per share) | $0.07 | ($0.05) | $0.01 | $0.08 | $0.27 | $0.46 | $2.52 | $0.05 | $0.12 | $3.32 | $0.12 |
Diluted net income per share: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Diluted net income per share from continuing operations (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | $0.16 | $3.28 | $0.17 |
Diluted net loss per share from discontinued operations (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ($0.05) | $0 | ($0.05) |
Diluted net income per share (in dollars per share) | $0.07 | ($0.05) | $0.01 | $0.08 | $0.26 | $0.46 | $2.49 | $0.05 | $0.11 | $3.28 | $0.12 |
NET_INCOME_PER_SHARE_Detail_Te
NET INCOME PER SHARE (Detail Textuals) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Earnings Per Share [Abstract] | ' | ' | ' |
Weighted average price of anti-dilutive options (in dollars per shares) | $6.07 | $6.07 | $4.62 |
Stock Options | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' |
Anti-dilutive common stock share purchase (in shares) | 823,338 | 821,838 | 2,518,914 |
QUARTERLY_RESULTS_OF_OPERATION2
QUARTERLY RESULTS OF OPERATIONS - UNAUDITED - Summary of consolidated statements of comprehensive income (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Quarterly Financial Information Disclosure [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenue | $5,637 | $4,314 | $4,427 | $4,979 | $4,858 | $4,771 | $3,514 | $4,161 | $19,357 | $17,304 | $16,199 |
Operating income before patent related income | 754 | 1,039 | 543 | 2,202 | 1,766 | 1,767 | 390 | 1,120 | 4,538 | 5,043 | 3,500 |
Gain on sale of patent assets | ' | ' | ' | ' | ' | 15,167 | 71,226 | ' | ' | 86,394 | ' |
Income from patent arrangement | ' | ' | ' | 780 | 1,121 | ' | ' | ' | 780 | 1,121 | ' |
Income from continuing operations | 525 | 790 | 465 | 1,972 | 6,006 | 10,272 | 54,938 | 1,167 | 3,752 | 72,383 | 3,581 |
Income (loss) from discontinued operations | 1,060 | -1,943 | -158 | -115 | -40 | 25 | -12 | -49 | -1,156 | -76 | -1,014 |
Net income (loss) | $1,585 | ($1,153) | $307 | $1,857 | $5,966 | $10,297 | $54,926 | $1,118 | $2,596 | $72,307 | $2,567 |
Net income (loss) per share - basic (in dollars per share) | $0.07 | ($0.05) | $0.01 | $0.08 | $0.27 | $0.46 | $2.52 | $0.05 | $0.12 | $3.32 | $0.12 |
Net income (loss) per share - diluted (in dollars per share) | $0.07 | ($0.05) | $0.01 | $0.08 | $0.26 | $0.46 | $2.49 | $0.05 | $0.11 | $3.28 | $0.12 |
Valuation_and_Qualifying_Accou1
Valuation and Qualifying Accounts (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Allowance for doubtful accounts receivable | ' | ' | ' |
Valuation and Qualifying Accounts Disclosure [Line Items] | ' | ' | ' |
Balance at Beginning of Period | $20 | $30 | $30 |
Charged to Cost and Expense | ' | ' | ' |
Charged to Other Accounts | ' | ' | ' |
Deductions Charged to Reserves | ' | 10 | ' |
Balance at End of Period | 20 | 20 | 30 |
Inventory reserves | ' | ' | ' |
Valuation and Qualifying Accounts Disclosure [Line Items] | ' | ' | ' |
Balance at Beginning of Period | ' | 1,403 | 989 |
Charged to Cost and Expense | ' | 126 | 450 |
Charged to Other Accounts | ' | ' | ' |
Deductions Charged to Reserves | ' | 1,529 | 36 |
Balance at End of Period | ' | ' | 1,403 |
Warranty reserves | ' | ' | ' |
Valuation and Qualifying Accounts Disclosure [Line Items] | ' | ' | ' |
Balance at Beginning of Period | 10 | ' | ' |
Charged to Cost and Expense | ' | 12 | ' |
Charged to Other Accounts | ' | ' | ' |
Deductions Charged to Reserves | 10 | 2 | ' |
Balance at End of Period | ' | 10 | ' |
Deferred tax asset valuation allowance | ' | ' | ' |
Valuation and Qualifying Accounts Disclosure [Line Items] | ' | ' | ' |
Balance at Beginning of Period | ' | 40,476 | 41,759 |
Charged to Cost and Expense | ' | ' | ' |
Charged to Other Accounts | ' | ' | -1,283 |
Deductions Charged to Reserves | ' | 40,476 | ' |
Balance at End of Period | ' | ' | $40,476 |