Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Jun. 30, 2014 | Feb. 26, 2015 | |
Document Information [Line Items] | |||
Document Type | 10-K | ||
Amendment Flag | FALSE | ||
Document Period End Date | 31-Dec-14 | ||
Document Fiscal Year Focus | 2014 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | PCO | ||
Entity Registrant Name | Pendrell Corp | ||
Entity Central Index Key | 1359555 | ||
Current Fiscal Year End Date | -19 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Accelerated Filer | ||
Entity Public Float | $304,995,185 | ||
Class A common stock | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 212,811,443 | ||
Class B common stock | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 53,660,000 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ||
Cash and cash equivalents | $168,793 | $184,567 |
Accounts receivable | 131 | 402 |
Other receivables-net of reserve $2,750 in both periods | 69 | 38 |
Prepaid expenses and other current assets | 774 | 1,722 |
Total current assets | 169,767 | 186,729 |
Property in service-net of accumulated depreciation of $1,227 and $722, respectively | 3,372 | 3,778 |
Other assets | 54 | 75 |
Intangible assets-net of accumulated amortization of $43,567 and $31,272, respectively | 109,702 | 139,687 |
Goodwill | 21,209 | 21,725 |
Total | 304,104 | 351,994 |
Current liabilities: | ||
Accounts payable | 281 | 166 |
Accrued expenses | 5,824 | 5,671 |
Other liabilities | 6,891 | 2,669 |
Total current liabilities | 12,996 | 8,506 |
Deferred tax liability | 1,521 | 1,488 |
Other non-current liabilities | 5,207 | |
Total liabilities | 14,517 | 15,201 |
Commitments and contingencies (Note 8) | ||
Shareholders' equity and noncontrolling interests: | ||
Preferred stock, $0.01 par value, 75,000,000 shares authorized, no shares issued or outstanding | ||
Additional paid-in capital | 1,952,880 | 1,941,818 |
Accumulated deficit | -1,671,135 | -1,619,993 |
Total Pendrell shareholders' equity | 284,414 | 324,488 |
Noncontrolling interests | 5,173 | 12,305 |
Total shareholders' equity and noncontrolling interests | 289,587 | 336,793 |
Total | 304,104 | 351,994 |
Class A common stock | ||
Shareholders' equity and noncontrolling interests: | ||
Common stock, value | 2,132 | 2,126 |
Class B common stock | ||
Shareholders' equity and noncontrolling interests: | ||
Common stock, value | $537 | $537 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, except Share data, unless otherwise specified | ||
Other receivables, reserve | $2,750 | $2,750 |
Property in service, accumulated depreciation | 1,227 | 722 |
Intangible assets, accumulated amortization | $43,567 | $31,272 |
Preferred stock, par value | $0.01 | $0.01 |
Preferred stock, shares authorized | 75,000,000 | 75,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Class A common stock | ||
Common stock, par value | $0.01 | $0.01 |
Common stock, shares authorized | 900,000,000 | 900,000,000 |
Common stock, shares issued | 270,745,381 | 270,220,116 |
Common stock, shares outstanding | 212,976,489 | 212,451,224 |
Class B common stock | ||
Common stock, par value | $0.01 | $0.01 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 84,663,382 | 84,663,382 |
Common stock, shares outstanding | 53,660,000 | 53,660,000 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 12 Months Ended | |||||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |||
Income Statement [Abstract] | ||||||
Revenue | $42,534 | $13,128 | $33,775 | |||
Operating expenses: | ||||||
Cost of revenues | 14,170 | 7,872 | 314 | |||
Patent administration and related costs | 6,386 | 4,405 | 3,655 | |||
Patent litigation | 9,880 | 4,564 | 2,538 | |||
General and administrative | 27,467 | 25,939 | 29,844 | |||
Stock-based compensation | 9,405 | 12,345 | 8,597 | |||
Amortization of intangibles | 15,929 | 15,864 | 13,471 | |||
Impairment of finite-lived intangibles and goodwill | 11,013 | 0 | 0 | |||
Total operating expenses | 94,250 | 70,989 | 58,419 | |||
Operating loss | -51,716 | -57,861 | -24,644 | |||
Interest income | 94 | 131 | 238 | |||
Interest expense | -193 | -195 | -2,483 | |||
Gain on deconsolidation of subsidiaries | 48,685 | |||||
Gain on settlement of Boeing litigation | 10,000 | |||||
Gain associated with disposition of assets | 5,599 | |||||
Other income (expense) | -16 | -55 | 1,588 | |||
Income (loss) before income taxes | -51,831 | -57,980 | 38,983 | |||
Income tax benefit (expense) | -6,303 | 1,034 | ||||
Net income (loss) | -58,134 | -57,980 | 40,017 | |||
Net loss attributable to noncontrolling interests | -7,132 | -2,918 | -67 | |||
Net income (loss) attributable to Pendrell | ($51,002) | ($55,062) | $40,084 | |||
Basic income (loss) per share attributable to Pendrell | ($0.19) | ($0.21) | $0.16 | |||
Diluted income (loss) per share attributable to Pendrell | ($0.19) | ($0.21) | $0.15 | |||
Weighted average shares outstanding used to compute basic income (loss) per share | 264,407,498 | 262,119,403 | 256,955,003 | |||
Weighted average shares outstanding used to compute diluted income (loss) per share | 264,407,498 | [1] | 262,119,403 | [1] | 263,824,279 | [1] |
[1] | Stock options, stock appreciation rights, restricted stock awards and units totaling 28,113,540, 34,408,579 and 26,593,976 for the years ended December 31, 2014, 2013 and 2012, respectively, were excluded from the calculation of diluted income (loss) per share as their inclusion was anti-dilutive. |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (Loss) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Statement of Comprehensive Income [Abstract] | |||
Net income (loss) | ($58,134) | ($57,980) | $40,017 |
Other comprehensive income (loss): | |||
Cumulative translation adjustments | -1,019 | ||
Reclassification of cumulative translation adjustment loss included in net income | 0 | 0 | 12,679 |
Comprehensive income (loss) | -58,134 | -57,980 | 51,677 |
Comprehensive loss attributable to noncontrolling interests | 7,132 | 2,918 | 67 |
Comprehensive income (loss) attributable to Pendrell | ($51,002) | ($55,062) | $51,744 |
Consolidated_Statements_Change
Consolidated Statements Changes in Shareholders' Equity (USD $) | Total | Common stock | Common stock | Common stock | Additional paid-in capital | Treasury stock | Accumulated other comprehensive income (loss) | Accumulated deficit | Shareholder's Equity | Noncontrolling interests |
In Thousands, except Share data | Class A common stock | Class B common stock | ||||||||
Beginning Balance at Dec. 31, 2011 | $312,778 | $3,497 | $2,794,970 | ($877,833) | ($11,660) | ($1,603,941) | $305,033 | $7,745 | ||
Beginning Balance (in shares) at Dec. 31, 2011 | 206,696,021 | 53,660,000 | ||||||||
Vesting of Class A common stock issued for Ovidian acquisition | 2,618 | 2,618 | 2,618 | |||||||
Issuance of Class A common stock from exercise of stock options | 780 | 38 | 742 | 780 | ||||||
Issuance of Class A common stock from exercise of stock options (in shares) | 3,769,985 | |||||||||
Class A common stock withheld at vesting to cover statutory tax obligations | -220 | -1 | -219 | -220 | ||||||
Class A common stock withheld at vesting to cover statutory tax obligations (in shares) | -88,056 | |||||||||
Stock-based compensation and issuance of restricted stock, net of forfeitures | 8,227 | 11 | 8,210 | 6 | 8,227 | |||||
Stock-based compensation and issuance of restricted stock, net of forfeitures (in shares) | 1,104,124 | |||||||||
Reclassification due to reincorporation | -890 | -877,014 | 878,046 | -142 | ||||||
Shares held by Liquidating Trust | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Shares held by Liquidating Trust (in shares) | 200,000 | |||||||||
Other comprehensive income | 11,660 | 11,660 | 11,660 | |||||||
Net income (loss) | 40,017 | 40,084 | 40,084 | -67 | ||||||
Ending Balance at Dec. 31, 2012 | 375,860 | 2,655 | 1,929,526 | -1,563,999 | 368,182 | 7,678 | ||||
Ending Balance (in shares) at Dec. 31, 2012 | 211,682,074 | 53,660,000 | ||||||||
Vesting of Class A common stock issued for Ovidian acquisition | 1,743 | 1,743 | 1,743 | |||||||
Issuance of Class A common stock from exercise of stock options and warrants | 186 | 2 | 184 | 186 | ||||||
Issuance of Class A common stock from exercise of stock options and warrants (in shares) | 165,312 | |||||||||
Class A common stock withheld at vesting to cover statutory tax obligations | -2,660 | -6 | -1,722 | -932 | -2,660 | |||||
Class A common stock withheld at vesting to cover statutory tax obligations (in shares) | -567,728 | |||||||||
Stock-based compensation and issuance of restricted stock, net of forfeitures | 12,099 | 12 | 12,087 | 12,099 | ||||||
Stock-based compensation and issuance of restricted stock, net of forfeitures (in shares) | 1,171,566 | |||||||||
Noncontrolling interest in Provitro | 7,545 | 7,545 | ||||||||
Net income (loss) | -57,980 | -55,062 | -55,062 | -2,918 | ||||||
Ending Balance at Dec. 31, 2013 | 336,793 | 2,663 | 1,941,818 | -1,619,993 | 324,488 | 12,305 | ||||
Ending Balance (in shares) at Dec. 31, 2013 | 212,451,224 | 53,660,000 | ||||||||
Vesting of Class A common stock issued for Ovidian acquisition | 2,229 | 2,229 | 2,229 | |||||||
Issuance of Class A common stock from exercise of stock options | 429 | 5 | 424 | 429 | ||||||
Issuance of Class A common stock from exercise of stock options (in shares) | 514,938 | |||||||||
Class A common stock withheld at vesting to cover statutory tax obligations | -775 | -2 | -633 | -140 | -775 | |||||
Class A common stock withheld at vesting to cover statutory tax obligations (in shares) | -161,823 | |||||||||
Stock-based compensation and issuance of restricted stock, net of forfeitures | 9,045 | 3 | 9,042 | 9,045 | ||||||
Stock-based compensation and issuance of restricted stock, net of forfeitures (in shares) | 172,150 | |||||||||
Net income (loss) | -58,134 | -51,002 | -51,002 | -7,132 | ||||||
Ending Balance at Dec. 31, 2014 | $289,587 | $2,669 | $1,952,880 | ($1,671,135) | $284,414 | $5,173 | ||||
Ending Balance (in shares) at Dec. 31, 2014 | 212,976,489 | 53,660,000 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Operating activities: | |||
Net income (loss) including noncontrolling interest | ($58,134) | ($57,980) | $40,017 |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | |||
Stock-based compensation | 9,405 | 12,345 | 8,597 |
Amortization of prepaid compensation from Ovidian acquisition | 1,380 | 2,763 | 2,993 |
Amortization of intangibles | 15,929 | 15,864 | 13,471 |
Impairment of finite-lived intangibles and goodwill | 11,013 | 0 | 0 |
Depreciation | 523 | 472 | 213 |
Unrealized foreign exchange (gains) losses | 1 | 6 | -446 |
Non-cash cost of patents monetized | 794 | 252 | |
Loss associated with the abandonment and/or disposition of patents | 2,765 | 46 | |
Gain on deconsolidation of subsidiaries | -48,685 | ||
Gain associated with disposition of assets | -5,599 | ||
Other | 221 | 192 | |
Other changes in certain assets and liabilities, net of acquisitions: | |||
Accounts receivable | 271 | 8,128 | -7,925 |
Other receivables | -31 | 818 | -91 |
Prepaid expenses and other current/non-current assets | 969 | -239 | 408 |
Accounts payable | 115 | -409 | 32 |
Accrued interest payable | 1,704 | ||
Accrued expenses and other current/non-current liabilities | 1,470 | 2,591 | -8,722 |
Net cash used in operating activities | -13,309 | -15,151 | -4,033 |
Investing activities: | |||
Purchases of property and intangible assets | -119 | -2,356 | -29,513 |
Proceeds associated with disposition of assets | 15,647 | ||
Acquisition of controlling interest in Provitro, net of cash acquired | -9,204 | ||
Net cash used in investing activities | -119 | -11,560 | -13,866 |
Financing activities: | |||
Proceeds from exercise of stock options and warrants | 429 | 185 | 780 |
Payment of statutory taxes for stock awards | -775 | -2,660 | -220 |
Payment of accrued obligations for purchased intangible assets | -2,000 | ||
Net cash provided by (used in) financing activities | -2,346 | -2,475 | 560 |
Effect of foreign exchange rate changes on cash | 715 | ||
Net decrease in cash and cash equivalents | -15,774 | -29,186 | -16,624 |
Cash and cash equivalents-beginning of period | 184,567 | 213,753 | 230,377 |
Cash and cash equivalents-end of period | 168,793 | 184,567 | 213,753 |
Supplemental disclosures: | |||
Income taxes paid | 6,272 | 2,156 | |
Income taxes received | 751 | ||
Supplemental disclosure of non-cash investing and financing activities: | |||
Accrued obligations for purchases of property and intangible assets | $5,573 |
Organization_and_Business
Organization and Business | 12 Months Ended |
Dec. 31, 2014 | |
Accounting Policies [Abstract] | |
Organization and Business | 1. Organization and Business |
Overview—These consolidated financial statements include the accounts of Pendrell Corporation (“Pendrell”) and its consolidated subsidiaries (collectively referred to as the “Company”). Since 2011, the Company’s strategy, through its consolidated subsidiaries, has been to invest in, acquire and develop businesses with unique technologies that are often protected by intellectual property (“IP”) rights, and that present the opportunity to address large, global markets. The Company’s subsidiaries focus on licensing the IP rights they hold to third parties and pursuing relevant product opportunities. The Company regularly evaluates its existing investments to determine whether retention or disposition is appropriate, and investigates new investment and business acquisition opportunities. The Company also advises its clients on various IP strategies and transactions. | |
Pendrell was originally incorporated in 2000 as a Delaware corporation. On November 14, 2012, the Company reincorporated from Delaware to Washington. The reincorporation merely changed the Company’s legal domicile. The Company’s consolidated financial condition and results of operations immediately after consummation of the reincorporation were the same as those immediately prior to the reincorporation. | |
The Company was formed in 2000 to operate a next generation global mobile satellite communications system. The Company began its exit from the satellite business in 2011 with the sale of its interests in DBSD North America, Inc. and its subsidiaries (collectively referred to as “DBSD”) to DISH Network Corporation (“DISH Network”). During 2012, the Company completed its exit with (i) the sale of its medium earth orbit (“MEO”) satellite assets (“MEO Assets”) that had been in storage for nominal consideration, (ii) the transfer of its in-orbit MEO satellite (“F2”) to a new operator who assumed responsibility for all F2 operating costs effective April 1, 2012 and (iii) the deconsolidation of its MEO-related international subsidiaries (“International Subsidiaries”). |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Accounting Policies [Abstract] | |||||||||||||
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies | ||||||||||||
Principles of Consolidation and Basis of Presentation—The consolidated financial statements of the Company include the assets and liabilities of its wholly-owned subsidiaries and subsidiaries it controls or in which it has a controlling financial interest. Noncontrolling interests on the consolidated balance sheets include third-party investments in entities that the Company consolidates, but does not wholly own. Noncontrolling interests are classified as part of equity and the Company allocates net income (loss), other comprehensive income (loss) and other equity transactions to its noncontrolling interests in accordance with their applicable ownership percentages. All intercompany transactions and balances have been eliminated in consolidation. All information in these financial statements is in U.S. dollars. These financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). | |||||||||||||
Segment Information—The Company operates in and reports on one segment (IP management). Operating segments are based upon the Company’s internal organization structure, the manner in which its operations are managed, and the criteria used by its Chief Operating Decision Maker. Substantially all of the Company’s revenue are generated by operations located within the United States, and the Company does not have any long-lived assets located in foreign countries. | |||||||||||||
Use of Estimates—The preparation of financial statements in conformity with GAAP requires management 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 amounts of revenues and expenses during the reporting period. Actual results could differ materially from these estimates. | |||||||||||||
On an ongoing basis, the Company evaluates its estimates, including among others, those related to the fair value of acquired intangible assets and goodwill, the useful lives and potential impairment of intangible assets and property and equipment, the value of stock awards for the purpose of determining stock-based compensation expense, accrued liabilities (including bonus accruals), valuation allowances related to the ability to realize deferred tax assets, allowances for doubtful receivables and certain tax liabilities. Estimates are based on historical experience and other factors, including the current economic environment as deemed appropriate under the circumstances. Estimates and assumptions are adjusted when facts and circumstances dictate. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates. Any changes in estimates used to prepare these financial statements will be reflected in the financial statements in future periods. | |||||||||||||
Reclassifications—Certain prior period amounts have been reclassified to conform to current year presentation. The reclassifications had no effect on previously reported net loss of the Company or the noncontrolling interest holder. Such reclassifications relate to the Company’s presentation of expenses in its consolidated statements of operations, including the presentation of “cost of revenues” and “patent litigation” as separate captions; as such costs were previously included in “patent administration, litigation and related costs” and “general and administrative.” The following is a summary of the revised expense categories: | |||||||||||||
Cost of revenue—Cost of revenue consists of certain costs that are variable in nature and are directly attributable to the Company’s revenue generating activities including (i) payments to third parties to whom the Company has an obligation to share revenue, (ii) commissions, and (iii) success fees. Additionally, in periods when patent sales occur, cost of revenue includes the net book value and other related costs associated with the sold patents. Depending on the patents being monetized, revenue share payments as a percentage of revenues may vary significantly. | |||||||||||||
Patent administration and related costs—Patent administration and related costs are comprised of (i) patent-related maintenance and prosecution costs incurred to maintain the Company’s patents, (ii) other costs that support its patent monetization efforts, and (iii) costs associated with the abandonment of patents, including the write-off of any remaining net book value. | |||||||||||||
Patent litigation—Patent litigation costs consist of costs and expenses incurred in connection with the Company’s patent-related enforcement and litigation activities. These may include non-contingent or contingent fee obligations to external counsel. | |||||||||||||
General and administrative—General and administrative expenses are primarily comprised of (i) personnel costs, (ii) general legal fees, (iii) professional fees, (iv) acquisition investigation costs, and (v) general office related costs. | |||||||||||||
Cash and Cash Equivalents—Cash and cash equivalents are defined as short-term, highly liquid investments with original maturities from the date of purchase of 90 days or less. Cash and cash equivalents are comprised of the following (in thousands): | |||||||||||||
December 31, | |||||||||||||
2014 | 2013 | ||||||||||||
Cash | $ | 18,403 | $ | 18,043 | |||||||||
Money market funds | 150,390 | 166,524 | |||||||||||
$ | 168,793 | $ | 184,567 | ||||||||||
The fair value of money market funds at December 31, 2014 and 2013 was classified as Level 1 in the hierarchy established by the Financial Accounting Standards Board (“FASB”) as amounts were based on quoted prices available in active markets for identical investments as of the reporting date. | |||||||||||||
Accounts Receivable—Accounts receivable consists of amounts billed to customers under licensing arrangements, patent sales arrangements or consulting services. The majority of the Company’s customers are well-established operating companies with investment-grade credit. For the periods ended December 31, 2014 and December 31, 2013, the Company did not incur any losses on its accounts receivable. Based upon historical collections experience and specific client information, the Company has determined that an allowance for doubtful accounts was not required at either December 31, 2014 or December 31, 2013. Carrying amounts of such receivables approximate their fair value due to their short-term nature. | |||||||||||||
Other Receivables—As of December 31, 2014 and 2013 the Company recorded a receivable due from Jay & Jayendra (Pty) Ltd, a South African corporation or its designated affiliate (collectively, the “J&J Group”) for reimbursement of operating expenses related to the Company’s MEO Assets of $2.7 million and a corresponding full reserve against the receivable as a result of the J&J Group’s failure to fulfill its obligation to reimburse the Company. The Company has obtained an enforcement judgment in South Africa (where J&J Group is domiciled), but due to the uncertainty of collection, the Company continues to maintain a full reserve against the receivable. Other receivables also include amounts for state income taxes, interest and other miscellaneous items. | |||||||||||||
Prepaid Expenses and Other Current Assets—As of December 31, 2014 and 2013 prepaid expenses and other current assets consisted primarily of insurance prepayments and prepayments related to rent and security deposits associated with certain of the Company’s leased facilities. | |||||||||||||
Property in Service—Property in service consists primarily of computer equipment, software, furniture and fixtures and leasehold improvements. Property in service is recorded at cost, net of accumulated depreciation, and is depreciated using the straight-line method. Computer equipment and furniture and fixtures are depreciated over their estimated useful lives ranging from three to five years. Software is depreciated over the shorter of its contractual license period or three years. Leasehold improvements are amortized over the shorter of their estimated useful lives or the term of the respective lease. Significant additions and improvements to property in service are capitalized. Repair and maintenance costs are expensed as incurred. | |||||||||||||
Other Assets—As of December 31, 2014 and 2013, other assets consisted primarily of long-term security deposits associated with the Company’s leased facilities. | |||||||||||||
Business Combinations—The Company accounts for business combinations using the acquisition method and, accordingly, the identifiable assets acquired and liabilities assumed are recorded at their acquisition date fair values. This valuation requires management to make significant estimates and assumptions, especially with respect to intangible assets. Valuation methodologies may include the cost, market or income approach. Critical estimates in valuing intangible assets include but are not limited to estimates about: future expected cash flows from customers, proprietary technology, the acquired company’s brand awareness and market position and discount rates. The estimates are based upon assumptions the Company believes to be reasonable, but which are inherently uncertain and unpredictable. Goodwill is calculated as the excess of the purchase price over the fair value of net assets, including the amount assigned to identifiable intangible assets. Subsequent changes to assets, liabilities, valuation allowance or uncertain tax positions that relate to the acquired company and existed at the acquisition date that occur both within the measurement period and as a result of new information about facts and circumstances that existed at the acquisition date are recognized as an adjustment to goodwill. Acquisition-related costs, including advisory, legal, accounting, valuation and other costs, are expensed in the periods in which the costs are incurred. The results of operations of acquired businesses are included in the consolidated financial statements from the acquisition date. | |||||||||||||
Intangible Assets and Goodwill— The Company amortizes finite-lived intangible assets, including patents, acquired in purchase transactions over their expected useful lives. The Company assigns goodwill and indefinite-lived intangible assets to its reporting units based on the expected benefit from the synergies arising from each business combination. | |||||||||||||
The Company evaluates finite-lived intangible assets when events or circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. These events or circumstances could include: a significant change in the business climate, legal factors, operating performance indicators, or changes in technology or customer requirements. Recoverability of an asset or asset group is measured by a comparison of the carrying amount to the future undiscounted net cash flows expected to be generated by the asset or asset group over its life. This comparison requires management to make judgments regarding estimated future cash flows. The Company’s ability to realize the estimated future cash flows may be affected by factors such as changes in operating performance, changes in business strategy, invalidation of patents, unfavorable judgments in legal proceedings and changes in economic conditions. If the Company’s estimates of the undiscounted cash flows do not equal or exceed the carrying value of the asset or asset group, an impairment charge equal to the amount by which the recorded value of the asset or asset group exceeds its fair value is recognized. | |||||||||||||
The Company evaluates goodwill for impairment on an annual basis during the fourth quarter, or more frequently if circumstances indicate that the carrying value of a Company reporting unit exceeds fair value. When evaluating goodwill and indefinite-lived intangible assets for impairment, the Company first performs a qualitative assessment to determine if fair value of the reporting unit is more likely than not greater than the carrying amount. If this assessment indicates that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, then the Company further evaluates the estimated fair value of the reporting unit through the use of discounted cash flow models, which requires management to make significant judgments as to the estimated future cash flows utilized. The Company’s ability to realize the future cash flows utilized in its fair value calculations may be affected by factors such as changes in its operating performance, changes in its business strategy, invalidation of its patents, unfavorable judgments in legal proceedings and changes in economic conditions. The results of the models are compared to the carrying amount of the reporting unit. If such comparison indicates that the fair value of the reporting unit is lower than the carrying amount, impairment would exist and the impairment charge would be measured by comparing the implied fair value of the reporting unit’s goodwill to its carrying value. | |||||||||||||
In January 2015, the Company suspended further development of its proprietary micro-propagation technology and related laboratory processes that are designed to facilitate production on a commercial scale of certain plants, particularly timber bamboo. Although the Company continued to pursue revenue generating business opportunities through the fourth quarter, it was unable to identify opportunities to commercialize the technology. The Company determined that the suspension of technology development provided additional evidence about conditions that existed prior to December 31, 2014. Accordingly, the Company took an $11.0 million impairment charge during the fourth quarter of its year ended December 31, 2014. The charge is equal to the sum of its unamortized investment in its developed Provitro™ technology and the goodwill associated with its February 21, 2013 acquisition of Provitro Biosciences LLC (“Provitro”). | |||||||||||||
For the years ended December 31, 2013 and 2012, the Company recorded no such impairment charges. | |||||||||||||
Fair Value of Financial Instruments—The Company determines the fair value of its financial instruments based on the fair value hierarchy established by the FASB. The three levels of inputs used to measure fair value are as follows: | |||||||||||||
Level 1—Quoted prices in active markets for identical assets and liabilities. | |||||||||||||
Level 2—Quoted prices in active markets for similar assets and liabilities or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. | |||||||||||||
Level 3—Unobservable inputs that are supported by little or no market activity and are significant to the fair value of the assets and liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. | |||||||||||||
As of December 31, 2014 and 2013, the Company’s financial instruments included its cash and cash equivalents, accounts receivable, other receivables, accounts payable and certain other assets and liabilities. The Company determines the carrying value of its financial instruments, based on the hierarchy established by the FASB, approximate the fair value of the financial instruments as they are equivalent to cash or due to their short-term nature. | |||||||||||||
Foreign Currency Translation and Foreign Currency Transactions and Accumulated Other Comprehensive Income (Loss)—The reporting currency for the Company’s operations is U.S. dollars. The Company translates the activities of its subsidiaries with functional currencies other than the U.S. dollar at the average exchange rate prevailing during the period. Gains and losses on foreign currency transactions are recognized as a component of other income (expense) in the consolidated statements of operations in the period in which they occur. Assets and liabilities denominated in foreign currencies are translated at the exchange rates prevailing at the balance sheet date. Translation adjustments resulting from these processes are recognized as a component of accumulated other comprehensive income (loss). | |||||||||||||
For the years ended, December 31, 2014 and 2013, there were no gains or losses on intercompany foreign currency translations. For the year ended December 31, 2012, gains on intercompany foreign currency translations of $0.1 million have been excluded from net income (loss) and reported as a component of accumulated other comprehensive income (loss) due to their long-term investment nature. | |||||||||||||
The Company recognizes applicable cumulative translation adjustments as a component of other operating income (loss) in the period in which a subsidiary is substantially liquidated or deconsolidated. For the year ended December 31, 2014 and 2013, there were no reclassifications of cumulative translation gains or losses resulting from the deconsolidation or liquidation of subsidiaries. For the year ended December 31, 2012, the Company reclassed net loss of $12.7 resulting from the deconsolidation of its International Subsidiaries. | |||||||||||||
The Company had no accumulated other comprehensive income or (loss) as of December 31, 2014 and 2013 due to the deconsolidation of the Company’s International Subsidiaries effective June 29, 2012. | |||||||||||||
Revenue Recognition— The Company derives its operating revenue from IP monetization activities, including patent licensing and patent sales, and from IP consulting services. Although the Company’s revenue may occur in different forms, it regards its IP monetization activities as integrated and not separate revenue streams. For example, a third party relationship could involve consulting and licensing activities, or the acquisition of a patent portfolio can lead to licensing, consulting and patent sales revenue. | |||||||||||||
The Company’s patent licensing agreements often provide for the payment of contractually determined upfront license fees representing all or a majority of the revenue that will be generated from such agreements for nonexclusive, nontransferable, limited duration licenses. These agreements typically grant (i) a nonexclusive license to make, sell, distribute, and use certain specified products that read on the Company’s patents, (ii) a covenant not to enforce patent rights against the licensee based on such activities, and (iii) the release of the licensee from certain claims. | |||||||||||||
Certain of the Company’s patent licensing agreements provide for future royalties or future payment obligations triggered upon satisfaction of conditions. Future royalties and future payments are recognized in revenue upon satisfaction of any related conditions, provided that all revenue recognition criteria, as described below, have been met. | |||||||||||||
The Company sells patents from its portfolios from time to time. These sales are part of the Company’s ongoing operations. Consequently, the related proceeds are recorded as revenue. | |||||||||||||
The timing and amount of revenue recognized from IP monetization activities depend on the specific terms of each agreement and the nature of the deliverables and obligations. Fees earned from IP consulting services are generally recognized as the services are performed. For agreements that are deemed to contain multiple elements, consideration is allocated to each element of an agreement that has stand-alone value using the relative fair value method. The Company recognizes revenue when (i) persuasive evidence of an arrangement exists, (ii) all material obligations have been substantially performed pursuant to agreement terms, services have been rendered to the customer or delivery has occurred, (iii) amounts are fixed or determinable, and (iv) collectability is reasonably assured. As a result of the contractual terms of our patent monetization agreements and the unpredictable nature, form and frequency of monetizing transactions, our revenue may fluctuate substantially from period to period. | |||||||||||||
Research and Development—The Company incurs costs associated with research and development activities and expenses the costs in the period incurred. Research and development expenses during the period were not material for separate disclosure and are included in general and administrative expenses. | |||||||||||||
Stock-Based Compensation—The Company records stock-based compensation on stock options, stock appreciation rights, restricted stock awards, restricted stock units and other stock awards issued to employees, directors, consultants and/or advisors based on the estimated fair value on the date of grant and recognizes compensation cost over the requisite service period for awards expected to vest. The fair value of stock options and stock appreciation rights is estimated on the date of grant using the Black-Scholes option pricing model (“Black-Scholes Model”) based on the single option award approach. The fair value of restricted stock awards and restricted stock units is determined based on the number of shares granted and either the quoted market price of the Company’s Class A common stock on the date of grant for time-based and performance-based awards, or the fair value on the date of grant using the Monte Carlo Simulation model (“Monte Carlo Simulation”) for market-based awards. The fair value of stock options, restricted stock awards and restricted stock units with service conditions are amortized to expense on a straight-line basis over the requisite service periods of the awards, which is generally the vesting period. The fair value of stock options, stock appreciation rights, restricted stock awards and restricted stock units with performance conditions deemed probable of being achieved and cliff vesting is amortized to expense over the requisite service period using the straight-line method of expense recognition. The fair value of restricted stock awards and restricted stock units with performance and market conditions are amortized to expense over the requisite service period using the straight-line method of expense recognition. The fair value of stock-based payment awards as determined by the Black-Scholes Model and the Monte Carlo Simulation are affected by the Company’s stock price as well as other assumptions. These assumptions include, but are not limited to, the expected stock price volatility over the term of the awards and actual and projected employee stock option exercise behaviors. Forfeitures are estimated at the date of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. | |||||||||||||
The Company accounts for the modification of the terms or conditions of a stock-based payment award as an exchange of the original award for a new award. Compensation expense for modified stock-based payment awards is equal to the fair value of the original award plus the incremental cost conveyed as a result of the modification expensed over the remaining life of the award. | |||||||||||||
Income Taxes—The Company accounts for income taxes using the asset and liability method under which deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to reverse. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that includes the enactment date. A valuation allowance against deferred tax assets (“DTAs”) is recorded when it is more likely than not that the assets will not be realized. | |||||||||||||
The Company records an unrecognized 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 tax authorities. The Company’s policy is to recognize interest and/or penalties related to unrecognized tax benefits as income tax expense. | |||||||||||||
Contingencies—Outcomes of legal proceedings and claims brought by and against the Company are subject to significant uncertainty. The Company accrues an estimated loss from a loss contingency, such as a legal claim, by a charge to income if it is probable that an asset has been impaired or a liability has been incurred and the amount of the loss can be reasonably estimated. The Company discloses a contingency if there is at least a reasonable possibility that a loss has been incurred. In determining whether a contingent loss should be accrued or disclosed, the Company evaluates, among other factors, the degree of probability of an unfavorable outcome and the ability to make a reasonable estimate of the amount of loss. Changes in these factors could materially impact the Company’s financial position, results of operations or cash flows. For contingencies that might result in a gain, the Company does not record the gain until realized. | |||||||||||||
Income (Loss) Per Share—Basic income (loss) per share is calculated based on the weighted average number of Class A common stock and Class B common stock (the “Common Shares”) outstanding during the period. Diluted income (loss) per share is calculated by dividing the income (loss) allocable to common shareholders by the weighted average Common Shares outstanding plus dilutive potential Common Shares. Prior to the satisfaction of vesting conditions, unvested restricted stock awards are considered contingently issuable and are excluded from weighted average Common Shares outstanding used for computation of basic income (loss) per share. | |||||||||||||
Potential dilutive Common Shares consist of the incremental Class A common stock issuable upon the exercise of outstanding stock options (both vested and non-vested), stock appreciation rights, warrants, and unvested restricted stock awards and units, calculated using the treasury stock method. The calculation of dilutive shares outstanding excludes out-of-the-money stock options (i.e., such options’ exercise prices were greater than the average market price of the Company’s Class A common shares for the period) because their inclusion would have been antidilutive. | |||||||||||||
The following table sets forth the computation of basic and diluted income (loss) per share (in thousands, except share and per share data): | |||||||||||||
Year ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Net income (loss) attributable to Pendrell | $ | (51,002 | ) | $ | (55,062 | ) | $ | 40,084 | |||||
Weighted average common shares outstanding | 266,336,617 | 265,684,341 | 261,335,347 | ||||||||||
Less: weighted average unvested restricted stock awards | (1,929,119 | ) | (3,564,938 | ) | (4,380,344 | ) | |||||||
Shares used for computation of basic income (loss) per share | 264,407,498 | 262,119,403 | 256,955,003 | ||||||||||
Add back: weighted average unvested restricted stock awards and units | — | — | 4,977,877 | ||||||||||
Add back: dilutive stock options and stock appreciation rights | — | — | 1,891,399 | ||||||||||
Shares used for computation of diluted income (loss) per share(1) | 264,407,498 | 262,119,403 | 263,824,279 | ||||||||||
Basic income (loss) per share attributable to Pendrell | $ | (0.19 | ) | $ | (0.21 | ) | $ | 0.16 | |||||
Diluted income (loss) per share attributable to Pendrell | $ | (0.19 | ) | $ | (0.21 | ) | $ | 0.15 | |||||
-1 | Stock options, stock appreciation rights, restricted stock awards and units totaling 28,113,540, 34,408,579 and 26,593,976 for the years ended December 31, 2014, 2013 and 2012, respectively, were excluded from the calculation of diluted income (loss) per share as their inclusion was anti-dilutive. | ||||||||||||
New Accounting Pronouncements—In August 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, which requires management to assess an entity’s ability to continue as a going concern every reporting period including interim periods, and to provide related footnote disclosure in certain circumstances. Compliance with this ASU is required for annual periods beginning after December 15, 2016. Early adoption is permitted. The adoption of this ASU in 2014 did not have an impact on the Company’s financial position, results of operations or cash flows. | |||||||||||||
In June 2014, the FASB issued ASU No. 2014-12, Compensation-Stock Compensation (Topic 718)—Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (a consensus of the FASB Emerging Issues Task Force). ASU No. 2014-12 requires that a performance target that affects vesting and could be achieved after the requisite service period shall be treated as a performance condition. Compliance with this ASU is required for annual periods beginning after December 15, 2015. Early adoption is permitted. The adoption of this ASU in 2014 did not have a material impact on the Company’s financial position, results of operations or cash flows. | |||||||||||||
In May 2014, the FASB issued ASU No. 2014-09, Revenue (Topic 606): Revenue from Contracts with Customers, which supersedes existing revenue recognition guidance under GAAP. The core principle of ASU 2014-09 is to recognize as revenue the amount that an entity expects to be entitled for goods or services at the time the goods or services are transferred to customers. ASU 2014-09 defines a five step process to achieve this core principle that will likely require more judgment and estimates within the revenue recognition process than are required under existing GAAP. Compliance with this ASU is required for annual periods beginning after December 15, 2016, and interim periods therein. Early adoption is not permitted. The Company is currently assessing the impact, if any, of implementing this ASU. |
Business_Combinations
Business Combinations | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Business Combinations [Abstract] | |||||
Business Combinations | 3. Business Combinations | ||||
On February 21, 2013, the Company acquired a 68.75% interest in Provitro. Accordingly, the activities of Provitro from the acquisition date though December 31, 2014 have been included in the Company’s consolidated statement of operations for the years ended December 31, 2014 and 2013. Acquisition-related costs, including advisory, legal, accounting, valuation and other costs associated with the acquisition of Provitro of $0.4 million, are included in general and administrative expenses for the year ended December 31, 2013. | |||||
The following table summarizes the allocation of the $16.6 million cash paid for the assets acquired and liabilities assumed as a result of the Provitro acquisition on February 21, 2013 (in thousands): | |||||
Tangible assets acquired and liabilities assumed: | |||||
Cash | $ | 7,396 | |||
Other current and noncurrent assets, net of liabilities | 430 | ||||
Property in service | 2,950 | ||||
Net tangible assets acquired | 10,776 | ||||
Identifiable intangible assets (developed technology) | 12,853 | ||||
Goodwill | 516 | ||||
Fair value of assets acquired | 24,145 | ||||
Fair value of 31.25% noncontrolling interest | (7,545 | ) | |||
Total purchase price | $ | 16,600 | |||
These allocations were based on fair value estimates as of the closing date of the acquisition and are included in the Company’s consolidated balance sheet at December 31, 2013. The Company used the cost approach to value the $12.9 million of definite-lived intangible assets related to the developed Provitro™ technology. | |||||
During the years ended December 31, 2014 and 2013, Provitro incurred $2.4 million and $2.9 million, respectively, of operating expenses which have been included in general and administrative expenses. | |||||
From acquisition through year-end 2014, the Company had been developing its strategy to commercialize the Provitro™ technology, but had yet to generate revenue associated with the technology. In January 2015, the Company suspended further development of the Provitro™ technology due to the Company’s inability to identify near-term opportunities for commercialization. Accordingly, the Company took an $11.0 million impairment charge during the fourth quarter of its year ended December 31, 2014. The impairment charge is equal to the sum of its unamortized investment in its developed Provitro™ technology and the goodwill associated with its acquisition of Provitro. |
Disposition_of_Satellite_Asset
Disposition of Satellite Assets | 12 Months Ended |
Dec. 31, 2014 | |
Text Block [Abstract] | |
Disposition of Satellite Assets | 4. Disposition of Satellite Assets |
During the first quarter of 2012, the Company sold the real property it held for use in its satellite business in Brazil for approximately $5.6 million and sold the remainder of its MEO Assets. On June 29, 2012, the Company transferred its International Subsidiaries to the Liquidating Trust. All of the property in Brazil, the MEO Assets and substantially all of the assets of the International Subsidiaries had been written off in prior years. The disposal of the Company’s satellite assets and transfer of its International Subsidiaries to a Liquidating Trust resulted in the elimination of approximately $61.9 million in satellite-related liabilities, a one-time $48.7 million gain, and the triggering of tax losses of approximately $2.4 billion, which the Company believes can be carried forward to offset taxable income for up to 20 years. |
Intangible_Assets_and_Goodwill
Intangible Assets and Goodwill | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||
Intangible Assets and Goodwill | 5. Intangible Assets and Goodwill | ||||||||
2014 Impairment of Finite-Lived Intangibles and Goodwill | |||||||||
The Company evaluates its finite-lived intangible assets when events or circumstances indicate that the carrying amount of a finite-lived intangible asset or asset group may not be recoverable. In January 2015, the Company suspended further development of the Provitro™ technology as it had been unable to identify near-term opportunities to commercialize the technology. The Company determined that this suspension provided additional evidence about conditions that existed prior to December 31, 2014, triggering an impairment analysis of the finite-lived intangibles associated with its Provitro asset group. In its impairment analysis, the Company compared the carrying amount of the Provitro™ technology to the future undiscounted net cash flows expected to be generated by the Provitro™ technology. The Company concluded that the anticipated undiscounted cash flows from the Provitro™ technology did not exceed the carrying value of the Provitro™ technology, prompting the Company to recognize a $10.5 million non-cash impairment charge in its results of operations for the year ended December 31, 2014. | |||||||||
The Company evaluates its goodwill for impairment on an annual basis during the fourth quarter, or more frequently if circumstances indicate that the carrying value of a Company reporting unit exceeds fair value. Upon the completion of the goodwill impairment analysis in the fourth quarter of the year ended December 31, 2014, the Company determined that there was no impairment associated with its IP management reporting unit. However, in light of the impairment of the Provitro™ technology, the Company determined that the goodwill related to its acquisition of Provitro was impaired and recorded a $0.5 million non-cash impairment charge in its results of operations for the year ended December 31, 2014. | |||||||||
For the years ended December 31, 2013 and 2012, the Company recorded no such impairment charges for finite-lived assets or goodwill. | |||||||||
Intangible Assets | |||||||||
The Company has determined that purchased trade names for both Ovidian and ContentGuard have indefinite lives as the Company expects to generate cash flows related to these assets indefinitely. Consequently, the trade names are not amortized, but are reviewed for impairment at least annually in the fourth quarter, or more frequently if circumstances indicate the carrying values of the assets may exceed their fair values. | |||||||||
Intangible assets with finite useful lives consist of acquired patents, developed technology, customer relationships and trade secrets which are amortized on a straight-line basis over the expected period of benefit which range from six to thirteen years. | |||||||||
The following table presents details of the Company’s intangible assets and related amortization (in thousands): | |||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Cost: | |||||||||
Patents | $ | 139,902 | $ | 144,739 | |||||
Developed technology(1) | — | 12,853 | |||||||
Customer relationships | 6,615 | 6,615 | |||||||
Trade names | 4,812 | 4,812 | |||||||
Trade secrets | 1,940 | 1,940 | |||||||
Total cost | 153,269 | 170,959 | |||||||
Accumulated amortization: | |||||||||
Patents | (40,321 | ) | (27,925 | ) | |||||
Developed technology(1) | — | (1,071 | ) | ||||||
Customer relationships | (2,680 | ) | (1,872 | ) | |||||
Trade names | — | — | |||||||
Trade secrets | (566 | ) | (404 | ) | |||||
Total accumulated amortization | (43,567 | ) | (31,272 | ) | |||||
Intangible assets, net | $ | 109,702 | $ | 139,687 | |||||
-1 | The Company recorded a non-cash impairment charge of $10.5 million related to Provitro’s developed technology reducing the carrying value to zero during the fourth quarter of the year ended December 31, 2014. | ||||||||
The following table presents the expected period of benefit of the Company’s intangible assets with finite useful lives: | |||||||||
Weighted | |||||||||
Average Lives | |||||||||
Patents | 10 years | ||||||||
Customer relationships | 9 years | ||||||||
Trade secrets | 12 years | ||||||||
The Company has used, and may continue to use, different structures and forms of consideration for its acquisitions of intangible assets. Acquisitions may be consummated through the use of cash, equity, seller financing, third party debt, earn-out obligations, revenue sharing, profit sharing, or some combination of these types of consideration. Consequently, the acquisition values reflected in the Company’s investing activities may represent lower amounts than would be reflected, for example, in a situation where cash alone was utilized to complete the acquisition. | |||||||||
During the year ended December 31, 2013, the Company expanded its patent holdings through the acquisition of additional patents covering memory and storage technologies for electronic devices. During 2012, the Company acquired patent portfolios covering wireless handset and infrastructure technologies, e-commerce, mobile applications, video delivery, security, and other technologies. Although no patents were purchased during the year ended December 31, 2014, the Company was issued 37 patents and filed applications for an additional 62 patents. | |||||||||
During the years ended December 31, 2014 and 2013, the Company sold patents in several transactions and has included the gross proceeds in revenue. Cost associated with the patents sold, including any remaining net book value, are included in cost of revenues. Certain of the patents sold, as well as certain of those licensed, were subject to an obligation to pay a substantial portion of the net proceeds to a third party. These costs are also included in cost of revenues. In future periods, these third party payments as a percentage of revenues may vary significantly based on the structure utilized for any given acquisition. | |||||||||
During the year ended December 31, 2014, the Company abandoned certain patents that were not part of existing licensing programs or for which the Company determined that it would no longer allocate resources to their maintenance and enforcement. Losses on the abandonment of patents for the year ended December 31, 2014 were $2.8 million. For the year ended December 31, 2013, patents with a combined book value of less than $0.1 million were abandoned. There were no abandonments for the year ended December 31, 2012. Costs associated with the abandonment of patents, including any remaining net book value, are included in patent administration and related costs. | |||||||||
As of December 31, 2014, the Company, through its subsidiaries, holds more than 1,200 issued patents worldwide, with additional patent applications pending. | |||||||||
The Company recorded amortization expense related to purchased intangible assets of $15.9 million, $15.9 million and $13.5 million for the years ended December 31, 2014, 2013, and 2012, respectively, which is included in amortization of intangibles in the consolidated statements of operations. | |||||||||
The estimated future amortization expense of purchased intangible assets as of December 31, 2014 is as follows (in thousands): | |||||||||
Year ending December 31, | Amount | ||||||||
2015 | $ | 14,332 | |||||||
2016 | 14,371 | ||||||||
2017 | 14,147 | ||||||||
2018 | 13,966 | ||||||||
2019 | 13,781 | ||||||||
Thereafter | 34,293 | ||||||||
Total | $ | 104,890 | |||||||
Goodwill | |||||||||
Goodwill represents the excess of purchase price over the fair value of net assets acquired in the Company’s acquisitions of Ovidian on June 17, 2011, ContentGuard on October 31, 2011 and Provitro on February 21, 2013. | |||||||||
The changes in the carrying amount of goodwill for the years ended December 31, 2014 and 2013 are as follows (in thousands): | |||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Beginning balance | $ | 21,725 | $ | 21,209 | |||||
Impairment of goodwill | (516 | ) | — | ||||||
Acquisition of Provitro | — | 516 | |||||||
Ending balance | $ | 21,209 | $ | 21,725 | |||||
Accrued_expenses
Accrued expenses | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Payables and Accruals [Abstract] | |||||||||
Accrued expenses | 6. Accrued expenses | ||||||||
The following table summarizes accrued expenses (in thousands): | |||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Accrued payroll and related expenses | $ | 2,570 | $ | 2,242 | |||||
Accrued legal, professional and other expenses | 3,254 | 3,429 | |||||||
$ | 5,824 | $ | 5,671 | ||||||
Other_liabilities
Other liabilities | 12 Months Ended |
Dec. 31, 2014 | |
Other Liabilities Disclosure [Abstract] | |
Other liabilities | 7. Other liabilities |
From time to time the Company agrees to make contingent and non-contingent future payments in connection with acquisition transactions. The Company recognizes the contingent portion of these future payments as liabilities when they are estimable and it is probable that they will be paid. At December 31, 2014, other current liabilities include an installment payment obligation of $4.0 million due in 2015 related to the 2013 acquisition of the Company’s memory and storage technologies portfolio. Additionally, other current liabilities include approximately $2.2 million of expense related to restricted stock awards. At December 31, 2013, installment payment obligations included in current and non-current liabilities were $2.0 million and $4.0 million, respectively. Additionally, other non-current liabilities included approximately $1.4 million of expense related to restricted stock awards. |
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||
Commitments and Contingencies | 8. Commitments and Contingencies | ||||||||||||
Purchase Commitments—The Company’s contractual obligations include an installment payment obligation arising from the 2013 acquisition of the Company’s memory and technology storage technologies portfolio of which $4.0 million is due in 2015. | |||||||||||||
Lease and Commitments—The Company has operating lease agreements for its main office in Kirkland, Washington, and offices in California, Texas, Washington, D.C. and Finland. Total rental expense included in general and administrative expenses in the Company’s consolidated statements of operations for the years ended December 31, 2014, 2013 and 2012 was as follows (in thousands): | |||||||||||||
Year ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Rent expense | $ | 662 | $ | 875 | $ | 637 | |||||||
As of December 31, 2014, future minimum payments under the Company’s lease agreements were as follows (in thousands): | |||||||||||||
Operating | |||||||||||||
leases | |||||||||||||
2015 | $ | 626 | |||||||||||
2016 | 612 | ||||||||||||
2017 | 591 | ||||||||||||
2018 | 425 | ||||||||||||
2019 | 205 | ||||||||||||
Total minimum payments | $ | 2,459 | |||||||||||
Litigation—In the opinion of management, except for those matters described below and elsewhere in this report, to the extent so described, litigation, contingent liabilities and claims against the Company in the normal course of business are not expected to involve any judgments or settlements that would be material to the Company’s financial condition, results of operations or cash flows. | |||||||||||||
Enforcement Action against Amazon et. al.—On December 18, 2013, ContentGuard filed a patent infringement lawsuit against Amazon.com, Inc., Apple Inc., Blackberry Corporation (fka Research in Motion Corporation), Huawei Device USA, Inc. and Motorola Mobility LLC (the “ContentGuard Defendants”) in the Eastern District of Texas, in which ContentGuard alleged that these ContentGuard Defendants infringed and continue to infringe nine of its patents by making, using, selling or offering for sale certain mobile communication and computing devices (the “Amazon Litigation”). On January 17, 2014, ContentGuard filed an amended complaint in the Amazon Litigation adding certain affiliates of the original defendants, along with HTC Corporation, HTC America Inc., Samsung Electronics Co., Ltd., Samsung Electronics America, Inc. and Samsung Telecommunications America, LLC. In August 2014, DirecTV intervened in the case and thereby became an additional ContentGuard Defendant, against whom ContentGuard asserted additional infringement claims. In February 2015, the presiding judge heard claim construction arguments from all parties. Trials are scheduled for September 2015. The Company is unable to anticipate the timing or outcome of the Amazon Litigation. | |||||||||||||
Google Actions—On January 31, 2014, Google Inc. (“Google”) filed a declaratory judgment suit in the Northern District of California alleging that Google does not infringe the nine patents asserted in the Amazon Litigation. On February 5, 2014, ContentGuard filed a patent infringement action in the Eastern District of Texas against Google, in which ContentGuard alleges that Google has infringed and continues to infringe the same nine patents. In April 2014, the presiding judge in the Eastern District of Texas, with the endorsement of the presiding judge in the Northern District of California, ruled that all claims by and against Google will be resolved in the Eastern District of Texas, and not in the Northern District of California. The presiding judge also declined to consolidate the Google actions with the Amazon Litigation. In February 2015, the presiding judge heard claim construction arguments. Trial is scheduled for September 2015. The Company is unable to anticipate the timing or outcome of the actions by and against Google. | |||||||||||||
IPR and CBM Petitions by ContentGuard Defendants—In December 2014, Apple filed with the United States Patent and Trademark Office (the “USPTO”) twenty-nine inter partes review (“IPR”) petitions and three covered business method (“CBM”) petitions , through which Apple is challenging the validity of all nine patents asserted in the Amazon Litigation. Also in December 2014, Google filed three CBMs, challenging the validity of three of the nine asserted patents. The USPTO will decide in the coming months whether to initiate review proceedings on some or all of the IPR and CBM petitions. The USPTO’s Patent Trial and Appeal Board (“PTAB”), which hears all IPR and CBM challenges, will administer and hear argument in any initiated proceedings. The Company is unable to predict whether or not proceedings will be initiated, or whether or not such proceedings will impact the timing or outcome of our claims against the ContentGuard Defendants. | |||||||||||||
ZTE IPRs—In early 2012, ContentGuard and its subsidiaries filed lawsuits in United States and German courts, alleging that ZTE Corporation, ZTE (USA) Inc. and ZTE Deutschland GmbH (collectively “ZTE”) infringed and continue to infringe ContentGuard patents by making, using, selling or offering for sale certain mobile communication and computing devices. ZTE subsequently filed IPR petitions with the USPTO, challenging the validity of six U.S. patents asserted by ContentGuard against ZTE. The PTAB terminated proceedings with respect to two patents, both of which emerged with valid patent claims. ZTE’s claims against the other four patents, all of which are also asserted against the ContentGuard Defendants, went to trial. Following trial, the PTAB rejected ZTE’s remaining challenges, and confirmed the validity of all claims in the four patents. ZTE’s time for appeal expired with no appeals filed. As a result, the decisions of the PTAB, as against ZTE, are now final. Nonetheless, all four affirmed patents have been challenged in fourteen new IPRs filed by Apple, as described in the paragraph above. The Company is unable to predict whether, and to what extent, the PTAB will allow Apple to challenge these patents in new proceedings. | |||||||||||||
ZTE Enforcement Actions—Meanwhile, in response to the claims filed against ZTE in Germany, in which ContentGuard GmbH alleged infringement of three European patents, ZTE filed a nullity action against two of the patents and an opposition proceeding against the third patent. The infringement and nullity proceedings in Germany, along with all U.S. court actions, were “put to rest” or stayed as the result of a standstill agreement signed by ContentGuard and ZTE in December 2013. ZTE prevailed in the opposition proceeding, resulting in the revocation of one European patent. ContentGuard must decide whether to appeal the revocation prior to end of the first quarter of 2015. The Company is unable to anticipate the timing or outcome of the opposition proceedings. | |||||||||||||
J&J Collection—In November 2012, the Company obtained an arbitration judgment in the U.K. against Jay and Jayendra (Pty), a South African corporation (“J&J Group”) for approximately $4.0 million. J&J Group submitted multiple appeals to the U.K. courts, the last of which was rejected in July 2013. In December 2014, the Company obtained an enforcement judgment against J&J Group from a South African court. J&J’s time to appeal the enforcement judgment expired with no appeals filed, and the Company has commenced action to enforce the judgment. Due to the uncertainty of collection, the Company has not recognized the gain associated with the judgment. The Company is unable to anticipate the timing or outcome of the collection proceedings against J&J Group. |
Shareholders_Equity
Shareholders' Equity | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||
Shareholders' Equity | 9. Shareholders’ Equity | ||||||||||||||||||||
Common Stock—The Company’s Articles of Incorporation authorizes two classes of common stock, Class A and Class B. The rights of the holders of shares of Class A common stock and Class B common stock are identical, except with respect to voting and conversion. Holders of shares of Class A common stock are entitled to one vote per share. Holders of shares of Class B common stock are entitled to ten votes per share. The Class B common stock is convertible at any time at the option of its holder into shares of Class A common stock. Each share of Class B common stock is convertible into one share of Class A common stock. Additionally, subject to certain exceptions, shares of Class B common stock will automatically convert into shares of Class A common stock if the shares of Class B common stock are sold or transferred. Class A common stock is not convertible. Eagle River Satellite Holdings, LLC, the Company’s controlling shareholder, together with its affiliates Eagle River Investments, LLC, Eagle River, Inc. and Eagle River Partners, LLC held an economic interest of approximately 33.3% and a voting interest of approximately 65.1% in the Company as of December 31, 2014. | |||||||||||||||||||||
Stock Incentive Plan—On November 14, 2012, the Company’s shareholders approved the Pendrell Corporation 2012 Equity Incentive Plan (the “2012 Plan”). Effective upon the approval of the 2012 Plan, the Company’s 2000 Stock Incentive Plan, as amended and restated (the “2000 Plan”) was terminated. No additional awards will be granted under the 2000 Plan. | |||||||||||||||||||||
The purpose of the 2012 Plan is to assist the Company in securing and retaining the services of skilled employees, directors, consultants and/or advisors of the Company and to provide incentives for such individuals to exert maximum efforts toward the Company’s success. The 2012 Plan allows for the grant of stock options, stock appreciation rights, performance stock awards, performance cash awards, restricted stock awards, restricted stock unit awards and other stock awards (collectively, “Awards”) to employees, directors, consultants and/or advisors who provide services to the Company or its subsidiaries. | |||||||||||||||||||||
Under the 2012 Plan, the aggregate number of shares of Class A common stock that may be issued pursuant to Awards from and after the effective date of the 2012 Plan will not exceed, in the aggregate, the sum of 37,952,546 shares, plus any shares subject to outstanding stock awards granted under the 2000 Plan that (i) expire or terminate for any reason prior to exercise or settlement; (ii) are forfeited, cancelled or otherwise returned due to the failure to meet a condition required to vest such shares; or (iii) are reacquired, withheld or not issued to satisfy a tax withholding obligation in connection with an award. As of December 31, 2014, 22,380,966 shares were reserved and remain available for grant under the 2012 Plan. | |||||||||||||||||||||
Stock-Based Compensation—The Company records stock-based compensation based on the estimated fair value on the date of grant and recognizes compensation cost over the requisite service period for awards expected to vest. The Company estimates its forfeiture rate for Awards based on the Company’s historical rate of forfeitures due to terminations and expectations for forfeitures in the future. The Company’s estimated forfeiture rate was 5% for the years ended December 31, 2014, 2013 and 2012. | |||||||||||||||||||||
Stock-based compensation expense included in the Company’s consolidated statements of operations for the years ended December 31, 2014, 2013 and 2012 was as follows (in thousands): | |||||||||||||||||||||
Year ended December 31, | |||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||
Stock options(1) | $ | 7,268 | $ | 5,723 | $ | 4,564 | |||||||||||||||
Restricted stock awards(1)(2)(3) | 2,137 | 6,622 | 4,033 | ||||||||||||||||||
Total stock-based compensation expense | $ | 9,405 | $ | 12,345 | $ | 8,597 | |||||||||||||||
-1 | On November 19, 2014, Benjamin G. Wolff resigned from his positions as President and Chief Executive Officer of the Company. The Company entered into a separation agreement in accordance with the terms of Mr. Wolff’s Amended and Restated Employment Letter Agreement (the “Agreement”). The Agreement provided for the vesting of all options, shares of restricted stock (“RSAs”) and restricted stock units (“RSUs”) in which Mr. Wolff would have vested had he remained actively employed by the Company through the second anniversary of his resignation, excluding any unvested performance-based RSAs or performance-based RSUs. The Agreement also provided for an extension of the exercise period for Mr. Wolff’s vested stock options until December 15, 2015. The extension of the exercise period is considered a modification and resulted in additional stock-based compensation expense of $0.7 million, as determined using a Black-Scholes model, which was recognized on the modification date as the options were vested pursuant to the Agreement. The accelerated vesting of the options, RSUs and RSAs resulted in $2.1 million of additional stock-based compensation expense in the year ended December 31, 2014. | ||||||||||||||||||||
-2 | Stock-based compensation expense for the year ended December 31, 2014, 2013 and 2012, includes $0.8 million, $0.8 million and $0.6 million of expense, respectively, related to 250,000 Class A common stock restricted stock awards that are required to be treated as a liability. As of December 31, 2014 and 2013, $2.2 million and $1.4 million, respectively, were accrued for such awards. | ||||||||||||||||||||
-3 | In August 2012, the Company’s Board of Directors approved a modification which applied additional alternative vesting criteria to 3,175,000 shares of restricted stock previously granted to 12 employees. As a result of the modification the Company recorded an additional $1.0 million of stock-based compensation expense for the year ended December 31, 2012, which represents the incremental fair value of the modified restricted stock. | ||||||||||||||||||||
At December 31, 2014, the balance of stock-based compensation cost to be expensed in future years related to unvested stock-based awards, as adjusted for expected forfeitures, is as follows (in thousands): | |||||||||||||||||||||
2015 | $ | 2,894 | |||||||||||||||||||
2016 | 1,428 | ||||||||||||||||||||
2017 | 763 | ||||||||||||||||||||
2018 | 203 | ||||||||||||||||||||
2019 and thereafter | — | ||||||||||||||||||||
$ | 5,288 | ||||||||||||||||||||
The weighted average period over which the unearned stock-based compensation expense is expected to be recognized is approximately 2.2 years. | |||||||||||||||||||||
Stock Options and Stock Appreciation Rights—The Company has granted stock options and stock appreciation rights to employees, directors, consultants and advisors in connection with their service to the Company. Stock options to purchase the Company’s Class A common stock are granted at the fair market value of the stock on the date of grant. The Company has both service-based stock options and performance-based stock options. The majority of service-based stock options granted to employees become exercisable over a four year period, while stock options granted to non-employee directors generally vest over one year. Performance-based stock options become exercisable, and stock appreciation rights will be triggered, if the Company achieves specified performance goals during the performance period and the grantee remains employed during the subsequent vesting period. Stock options generally expire 10 years after the date of grant or up to three months after termination of employment, whichever occurs earlier. | |||||||||||||||||||||
The weighted average fair value of stock options and stock appreciation rights granted during the years ended December 31, 2014, 2013 and 2012 was estimated using the Black-Scholes Model with the following assumptions: | |||||||||||||||||||||
Year ended December 31, | |||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||
Weighted average expected volatility | 55 | % | 55 | % | 57 | % | |||||||||||||||
Weighted average risk-free interest rate | 1.9 | % | 1.2 | % | 1.1 | % | |||||||||||||||
Expected dividend yield | 0 | % | 0 | % | 0 | % | |||||||||||||||
Weighted average expected term in years | 6.2 | 5.8 | 6.2 | ||||||||||||||||||
Weighted average estimated fair value per option granted | $ | 0.79 | $ | 0.88 | $ | 0.68 | |||||||||||||||
The assumptions used to calculate the fair value are evaluated and revised, as necessary, to reflect market conditions and the Company’s experience. | |||||||||||||||||||||
Prior to the third quarter of 2012, the Company’s expected stock price volatility rate was a blend of the Company’s historical stock price volatility and a peer historical volatility, which the Company believed was in line with its change in business direction and was more reflective of the Company’s expected future volatility at that time. In the third quarter of 2012, the Company modified the expected stock price volatility rate to a rate based solely on the Company’s peer historical volatility. The change occurred simultaneous with the Company’s complete exit from its historical satellite business as a result of the divesture of its remaining MEO Assets and the deconsolidation of its International Subsidiaries on June 29, 2012. The Company is now focused on its IP investment, advisory and asset management business and has determined that a volatility rate based solely on a peer group is more representative of the Company’s business direction and expected future volatility. | |||||||||||||||||||||
The risk-free interest rate is based upon U.S. Treasury bond interest rates appropriate for the term of the Company’s employee stock options and stock appreciation rights. The expected dividend yield is based on the Company’s history and expectation of dividend payments. The expected term has been estimated using the simplified method which permit entities, under certain circumstances, to continue to use the simplified method in developing estimates of the expected term of “plain-vanilla” share options and stock appreciation rights. | |||||||||||||||||||||
The Company granted the following stock options and stock appreciation rights to certain employees in connection with their continued or new employment with the Company during the years ended December 31, 2014, 2013 and 2012 (dollars in thousands): | |||||||||||||||||||||
Year ended December 31, | |||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||
Service-based | 4,374,000 | 1,248,000 | 15,450,875 | ||||||||||||||||||
Performance-based | — | 250,000 | — | ||||||||||||||||||
Stock options issued as Board of Director compensation | 300,000 | 300,000 | 300,000 | ||||||||||||||||||
Total granted | 4,674,000 | 1,798,000 | 15,750,875 | ||||||||||||||||||
Fair value of grants | $ | 3,702 | $ | 1,585 | $ | 10,712 | |||||||||||||||
The Company’s stock option and stock appreciation rights activity for the years ended December 31, 2014, 2013 and 2012 is summarized as follows: | |||||||||||||||||||||
Number of | Weighted | Weighted | Aggregate | ||||||||||||||||||
options/SARs | average | average | intrinsic | ||||||||||||||||||
exercise | remaining | value(1) | |||||||||||||||||||
price | life | (in thousands) | |||||||||||||||||||
(in years) | |||||||||||||||||||||
Outstanding at December 31, 2011 | 14,195,000 | $ | 3.23 | ||||||||||||||||||
Granted | 15,750,875 | 1.27 | |||||||||||||||||||
Exercised | (597,875 | ) | 1.25 | ||||||||||||||||||
Forfeited | (862,625 | ) | 3.04 | ||||||||||||||||||
Outstanding at December 31, 2012 | 28,485,375 | 2.19 | |||||||||||||||||||
Granted | 1,798,000 | 1.73 | |||||||||||||||||||
Exercised | (165,312 | ) | 1.13 | ||||||||||||||||||
Forfeited | (1,621,600 | ) | 2.2 | ||||||||||||||||||
Outstanding at December 31, 2013 | 28,496,463 | 2.17 | |||||||||||||||||||
Granted | 4,674,000 | 1.49 | |||||||||||||||||||
Exercised | (992,499 | ) | 1.18 | ||||||||||||||||||
Forfeited(2) | (6,623,938 | ) | 2.65 | ||||||||||||||||||
Outstanding at December 31, 2014(3) | 25,554,026 | $ | 1.96 | 4.93 | $ | 2,494 | |||||||||||||||
Exercisable at December 31, 2014(3) | 16,987,290 | $ | 1.79 | 3.39 | $ | 1,970 | |||||||||||||||
Vested and expected to vest at December 31, 2014(3) | 25,175,679 | $ | 1.96 | 4.88 | $ | 2,468 | |||||||||||||||
-1 | Aggregate intrinsic value represents total pretax intrinsic value (i.e., the difference between the Company’s closing stock price on the last trading day of 2014 and the exercise price, times the number of shares) that would have been received by the option holders had all option holders exercised their stock options and stock appreciation rights on the last business day of the fiscal year. | ||||||||||||||||||||
-2 | In association with the departure of the Company’s former CEO, during the year ended December 31, 2014 an additional 375,000 stock options vested due to accelerated vesting of shares and an additional 375,000 shares forfeited. | ||||||||||||||||||||
-3 | In association with the departure of the Company’s former CEO, and in accordance with the terms of Mr. Wolff’s Agreement, the exercise period for Mr. Wolff’s vested stock options was extended until December 15, 2015. Excluding Mr. Wolff’s 8,927,500 vested options with a weighted average exercise price of $1.42 and a weighted average remaining life of 0.96 years, the weighted average exercise price and weighted average remaining life for all other outstanding, exercisable, and vested and expected to vest options and stock appreciation rights, is as follows: | ||||||||||||||||||||
Number of | Weighted | Weighted | |||||||||||||||||||
Options/ | average | average | |||||||||||||||||||
SARs | exercise | remaining | |||||||||||||||||||
price | life | ||||||||||||||||||||
(in years) | |||||||||||||||||||||
Outstanding at December 31, 2014 | 16,626,526 | $ | 2.24 | 7.06 | |||||||||||||||||
Exercisable at December 31, 2014 | 8,059,790 | 2.19 | 6.09 | ||||||||||||||||||
Vested and expected to vest at December 31, 2014 | 16,248,179 | 2.26 | 7.03 | ||||||||||||||||||
The intrinsic value of stock options exercised during the year ended December 31, 2014 was $0.4 million. The total fair value of options which vested during the years ended December 31, 2014, 2013 and 2012 was approximately $7.3 million, $5.8 million and $4.1 million, respectively. | |||||||||||||||||||||
The following table summarizes significant ranges of outstanding and exercisable stock options and stock appreciation rights as of December 31, 2014: | |||||||||||||||||||||
Outstanding stock options and | Exercisable stock options | ||||||||||||||||||||
stock appreciation rights | and stock appreciation rights | ||||||||||||||||||||
Range of exercise prices | Number of | Weighted | Weighted | Number of | Weighted | ||||||||||||||||
options/SARs | average | average | options/SARs | average | |||||||||||||||||
exercise | remaining | exercise | |||||||||||||||||||
price | life (in | price | |||||||||||||||||||
years) | |||||||||||||||||||||
$0.00—$2.00 | 18,270,063 | $ | 1.29 | 4.96 | 11,887,990 | $ | 1.25 | ||||||||||||||
$2.01—$4.00 | 5,163,963 | 2.62 | 5.31 | 3,979,300 | 2.67 | ||||||||||||||||
$4.01—$6.00 | 1,620,000 | 4.9 | 2.84 | 1,120,000 | 4.4 | ||||||||||||||||
$6.01—$10.00 | 500,000 | 10 | 6.46 | — | — | ||||||||||||||||
25,554,026 | $ | 1.96 | 4.93 | 16,987,290 | $ | 1.79 | |||||||||||||||
Restricted Stock Awards—The Company has granted restricted stock awards to employees and consultants in connection with their service to the Company. The Company’s stock grants can be categorized as either service-based awards, performance-based awards, and/or market-based awards. | |||||||||||||||||||||
The Company granted the following shares of Class A common stock underlying restricted stock awards to certain employees in connection with their continued or new employment with the Company and to members of its board of directors during the years ended December 31, 2014, 2013 and 2012 (dollars in thousands): | |||||||||||||||||||||
Year ended December 31, | |||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||
Service-based(1) | 250,000 | 211,250 | 3,401,813 | ||||||||||||||||||
Market-based(2)(3)(4)(5) | 150,000 | 300,000 | 2,927,812 | ||||||||||||||||||
Shares issued as Board of Director compensation | 279,349 | 348,698 | 145,124 | ||||||||||||||||||
Total granted | 679,349 | 859,948 | 6,474,749 | ||||||||||||||||||
Fair value of grants | $ | 869 | $ | 1,198 | $ | 9,979 | |||||||||||||||
-1 | The service-based restricted stock awards generally vest at a rate of 25% per year over four years. | ||||||||||||||||||||
-2 | The market-based RSUs granted during the year ended December 31, 2014 fully vest when both of the following have occurred: (i) the average closing price of the Company’s Class A common stock, measured over any period of 60 consecutive calendar days, has reached or exceeded $3.00 per share (the “Price Trigger”), and (ii) the first anniversary of the grant date has occurred. If the Price Trigger is not achieved by the third anniversary of the grant date, then none of the market-based RSUs will vest. | ||||||||||||||||||||
-3 | The market-based RSUs granted during the year ended December 31, 2013 consisted of two awards of 150,000 units each would have vested only after designated time periods had elapsed and designated stock prices had been met. These awards were forfeited during the year ended December 31, 2014. | ||||||||||||||||||||
-4 | The market-based RSUs granted during the year ended December 31, 2012 vest based upon, (i) the Company’s common stock achieving an average closing price of $2.00 for 60 consecutive calendar days, and (ii) upon the Company’s common stock achieving an average closing price of $3.00 for 60 consecutive calendar days. During the year ended December 31, 2013 the market condition of an average closing stock price of $2.00 for 60 consecutive calendar days was met and 2,780,164 restricted stock awards vested. | ||||||||||||||||||||
-5 | On August 24, 2012, the Company’s Board of Directors approved a modification which added alternative vesting criteria for 3,175,000 shares of restricted stock previously granted to employees, including the 2,975,000 granted in 2011. The performance conditions were modified to encourage the attainment of key performance targets and retention of skilled employees. The new terms for the modified restricted stock with performance conditions provide for vesting to occur on the earlier of the Company’s achievement of certain financial targets or modified share price targets. No other terms of the restricted stock awards were modified. | ||||||||||||||||||||
The Company’s restricted stock award activity for the years ended December 31, 2014, 2013 and 2012 is summarized as follows: | |||||||||||||||||||||
Number of | Weighted | ||||||||||||||||||||
restricted | average | ||||||||||||||||||||
stock awards | grant date | ||||||||||||||||||||
fair value | |||||||||||||||||||||
Unvested—December 31, 2011 | 4,610,909 | $ | 2.18 | ||||||||||||||||||
Granted | 6,474,749 | 1.55 | |||||||||||||||||||
Vested | (559,783 | ) | 1.57 | ||||||||||||||||||
Forfeited | (717,500 | ) | 1.62 | ||||||||||||||||||
Unvested—December 31, 2012 | 9,808,375 | 1.84 | |||||||||||||||||||
Granted | 859,948 | 1.39 | |||||||||||||||||||
Vested | (4,298,239 | ) | 1.53 | ||||||||||||||||||
Forfeited | (457,968 | ) | 1.76 | ||||||||||||||||||
Unvested—December 31, 2013 | 5,912,116 | 1.62 | |||||||||||||||||||
Granted | 679,349 | 1.28 | |||||||||||||||||||
Vested | (1,844,012 | ) | 1.87 | ||||||||||||||||||
Forfeited | (2,187,939 | ) | 1.23 | ||||||||||||||||||
Unvested—December 31, 2014 | 2,559,514 | $ | 1.67 | ||||||||||||||||||
During the year ended December 31, 2014, 1,042,188 stock awards vested due to the accelerated vesting of Mr. Wolff’s RSAs and RSUs and 801,824 vested as a result of the Company’s employees achieving service targets. Certain holders of the vested RSAs and RSUs exercised their right to have their awards net-share settled to cover statutory employee taxes related to the vesting of the RSAs and RSUs. The settlement of these awards resulted in the Company repurchasing and/or cancelling 504,435 shares for $0.8 million. Of this amount, $0.2 million was charged to retained earnings and $0.6 million was charged to additional paid in capital. | |||||||||||||||||||||
During the year ended December 31, 2013, 2,780,164 market-based RSAs and RSUs vested as a result of the Company’s achievement of the market condition of an average closing stock price of $2.00 for 60 consecutive calendar days and 1,518,075 service-based RSAs and RSUs vested as a result of the achievement of service targets. The net-share settlement of certain of these awards resulted in the Company repurchasing and/or cancelling 1,107,901 shares for $2.7 million. Of this amount, $1.0 million was charged to retained earnings and $1.7 million was charged to additional paid in capital. | |||||||||||||||||||||
During the year ended December 31, 2012 all vested awards were service based awards. | |||||||||||||||||||||
Warrants—In connection with the settlement of long-term debt in 2002, the Company issued warrants to purchase shares of the Company’s Class A common stock. Each warrant contained provisions for the adjustment of the exercise price and the number of shares issuable upon the exercise of the warrant in the event of certain dilutive transactions. During the fourth quarter of 2012, warrants to purchase a total of 3.2 million shares of the Company’s Class A common stock were exercised at a price of $0.01 per share. As of December 31, 2014 and 2013, there were no additional warrants outstanding. |
Gain_on_Deconsolidation_of_Sub
Gain on Deconsolidation of Subsidiaries | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Text Block [Abstract] | |||||
Gain on Deconsolidation of Subsidiaries | 10. Gain on Deconsolidation of Subsidiaries | ||||
After the sale of the MEO Assets, the Company’s only remaining satellite-related assets were housed in the International Subsidiaries. Due to cumbersome corporate laws in the jurisdictions in which the International Subsidiaries are domiciled, the Company could not liquidate and dissolve the International Subsidiaries in a cost effective manner; nor could it merely abandon the entities. Accordingly, the Company determined that the most expeditious path to divestiture was a complete disposition of the International Subsidiaries into the Liquidating Trust. | |||||
As a result of the transfer of the International Subsidiaries to the Liquidating Trust, control of the International Subsidiaries now rests with the trustee of the Liquidating Trust rather than the Company. Although the Company no longer has control of the International Subsidiaries, it remains a creditor in the same manner as other third party creditors due to significant loans made to the International Subsidiaries The Company determined that its status as a creditor does not render the Liquidating Trust a variable interest entity, and therefore deconsolidated the International Subsidiaries from its consolidated financial operating results effective June 29, 2012. | |||||
As a result of the deconsolidation of the International Subsidiaries, the Company recognized a gain of $48.7 million principally through the elimination of $61.9 million of liabilities associated with the International Subsidiaries, including liabilities for uncertain tax positions, net of the recognition of cumulative translation adjustment losses associated with the International Subsidiaries of $12.7 million previously recognized in accumulated other comprehensive loss in shareholders’ equity. | |||||
The following table summarizes the International Subsidiaries obligations, excluding $10.0 million for liabilities related to uncertain tax positions, prior to the transfer to the Liquidating Trust on June 29, 2012 (in thousands): | |||||
June 29, | |||||
2012 | |||||
Accrued expenses | $ | 6,568 | |||
Accrued interest | 30,474 | ||||
Capital lease obligations | 14,881 | ||||
$ | 51,923 | ||||
The Company continued to accrue expenses associated with contractual obligations of the International Subsidiaries until the liabilities were transferred to the Liquidating Trust. During the year ended December 31, 2012, the Company recorded general and administrative expenses related to the International Subsidiaries of $0.3 million and recorded $2.5 million of interest expense related to the contractual obligations of the International Subsidiaries. |
Gain_on_settlement_of_Boeing_L
Gain on settlement of Boeing Litigation | 12 Months Ended |
Dec. 31, 2014 | |
Text Block [Abstract] | |
Gain on settlement of Boeing Litigation | 11. Gain on settlement of Boeing Litigation |
The Company was in litigation with Boeing, arising out of agreements with Boeing for the development and launch of its MEO satellites and related launch vehicles. In February 2009, the trial court entered judgment in the Company’s favor for approximately $603.2 million. On April 13, 2012, the California Court of Appeal overturned the judgment. The reversal was the culmination of a three year Court of Appeal process. The Court of Appeal also ordered the Company to reimburse Boeing for its appellate costs, including the cost of an appellate bond, which would have been material. | |
On June 25, 2012, the Company settled its litigation against Boeing. As part of the settlement, the Company agreed to withdraw its petition for review to the California Supreme Court in exchange for a $10.0 million payment from Boeing and Boeing’s waiver of its right to appellate costs. The settlement agreement and mutual release between the Company and Boeing fully releases and discharges any and all claims between Boeing and the Company. As a result of the agreement, the Company recorded a gain on litigation settlement of $10.0 million during the year ended December 31, 2012. |
Income_Taxes
Income Taxes | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||
Income Taxes | 12. Income Taxes | ||||||||||||
The Company’s income tax expense (benefit) for the years ended December 31, 2014, 2013 and 2012 consists of the following (in thousands): | |||||||||||||
Year ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
United States—deferred | $ | 33 | $ | — | $ | — | |||||||
Foreign—current | 6,270 | — | (1,034 | ) | |||||||||
$ | 6,303 | $ | — | $ | (1,034 | ) | |||||||
For the year ended December 31, 2014, the Company recorded a tax provision of $6.3 million related to foreign taxes withheld on revenue generated from a license agreement with a licensee domiciled in a foreign jurisdiction. In general, foreign taxes withheld may be claimed as a deduction on future U.S. corporate income tax returns, or as a credit against future U.S. federal income tax liabilities, subject to certain limitations. However, due to uncertainty regarding the Company’s ability to utilize the deduction or credit resulting from the foreign withholding, at December 31, 2014, the Company established a full valuation allowance against this deferred tax asset. | |||||||||||||
The foreign-current income tax benefit recorded for the year ended December 31, 2012 was primarily due to expiration of the statute of limitations associated with previously recorded uncertain tax positions, including interest and penalties. | |||||||||||||
A reconciliation of the federal statutory income tax rate of 34% to the Company’s effective income tax rate is as follows: | |||||||||||||
Year ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Statutory tax rate | 34 | % | 34 | % | 34 | % | |||||||
Change in valuation allowance | (95.75 | ) | (9.33 | ) | (28.71 | ) | |||||||
Release of uncertain tax position | 62.77 | — | — | ||||||||||
Foreign withholding taxes | (7.98 | ) | — | — | |||||||||
Deferred tax adjustments | — | (43.17 | ) | — | |||||||||
§338(h)(10) asset sale treatment upon DBSD sale to DISH | — | 21.22 | — | ||||||||||
Liquidation and deconsolidation of subsidiaries | — | (0.02 | ) | (52.91 | ) | ||||||||
Change in state rate | (0.13 | ) | (0.10 | ) | 40.89 | ||||||||
Expiration of NOLs | (0.13 | ) | (1.11 | ) | 0.78 | ||||||||
Other | (4.94 | ) | (1.49 | ) | 0.89 | ||||||||
Foreign tax benefit | — | — | 2.41 | ||||||||||
Effective tax rate | (12.16 | )% | — | (2.65 | )% | ||||||||
The significant components of the Company’s net deferred tax assets and liabilities are as follows (in thousands): | |||||||||||||
December 31, | December 31, | ||||||||||||
2014 | 2013 | ||||||||||||
Deferred tax assets: | |||||||||||||
Net operating and capital losses | $ | 938,235 | $ | 894,798 | |||||||||
Basis difference in Liquidating Trust | 29,381 | 31,642 | |||||||||||
Accrued expenses and other | 14,824 | 10,150 | |||||||||||
Total deferred tax assets | 982,440 | 936,590 | |||||||||||
Valuation allowance | (955,133 | ) | (905,502 | ) | |||||||||
Net deferred tax assets | $ | 27,307 | $ | 31,088 | |||||||||
Deferred tax liabilities: | |||||||||||||
Intangibles | $ | (28,828 | ) | $ | (32,576 | ) | |||||||
Total deferred tax liabilities | $ | (28,828 | ) | $ | (32,576 | ) | |||||||
Net deferred tax liabilities | $ | (1,521 | ) | $ | (1,488 | ) | |||||||
As of December 31, 2014, the Company had federal tax net operating loss carryforwards in the United States (“NOLs”) of approximately $2.5 billion. A significant portion of the NOL was triggered when the Company disposed of its satellite business and transferred the International Subsidiaries to the Liquidating Trust. The Company believes the NOL can be carried forward to offset certain future taxable income that may be generated during the NOL carryforward period. The NOL carryforward period begins to expire in 2025 with a significant portion expiring in 2032. The use of the NOL will be significantly limited if the Company undergoes a Tax Ownership Change under Section 382 of the Internal Revenue Code (“Tax Ownership Change”). Broadly, the Company will have a Tax Ownership Change if, over a three year testing period, the portion of all stock of the Company, by value, owned by one or more 5% shareholder increases by more than 50 percentage points. For purposes of this test, shareholders that own less than 5% of the stock of the Company are aggregated into one or more separate “public groups”, each of which is treated as a 5% shareholder. In general, shares traded within a public group are not included in the Tax Ownership Change test. As discussed below, the Board of Directors adopted a Tax Benefits Preservation Plan designed to preserve shareholder value and the value of certain tax assets primarily associated with NOLs under Section 382. As of December 31, 2014, the Company also had tax loss carryforwards in the state of California of approximately $1.4 billion, a portion of which will expire in 2015. A significant portion of the California loss carryforward was generated when the Company disposed of its satellite business and will expire in 2032. The impacts of a Tax Ownership Change, discussed above, would apply to the California tax losses as well. | |||||||||||||
For all years presented, the Company has considered all available evidence, including the history of tax losses and the uncertainty around future taxable income. Based on the weight of the evidence available at December 31, 2014, a valuation allowance has been recorded to reduce the value of the Company’s DTA, including the DTA associated with the NOL, to an amount that is more likely than not to be realized. | |||||||||||||
As of December 31, 2013, the Company had unrecognized tax benefits of $37.7 million. During the year ended December 31, 2014, the IRS consented to the Company’s request for reasonable cause relief regarding the availability of an additional $95.7 million of NOLs. As a result, the Company released $32.5 million of unrecognized tax benefit during the year, resulting in a remaining unrecognized tax benefit of $5.1 million at December 31, 2014, with no accrued interest and penalties. The additional $95.7 million of NOLs is included in the $2.5 billion NOL carryforward discussed above. | |||||||||||||
A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands): | |||||||||||||
December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Beginning of period | $ | 37,665 | $ | 19,452 | $ | 4,686 | |||||||
Additions based on tax positions related to the current year | — | — | 19,452 | ||||||||||
Additions for tax positions related to prior years | — | 32,533 | 144 | ||||||||||
Reductions for tax positions of prior years | (32,533 | ) | (14,320 | ) | (4,830 | ) | |||||||
End of period | $ | 5,132 | $ | 37,665 | $ | 19,452 | |||||||
The unrecognized tax benefits at December 31, 2014, if fully recognized, would decrease the Company’s effective tax rate. The Company estimates a reduction in its unrecognized tax benefits of approximately $5.1 million may occur within the next twelve months upon resolution of determinations by taxing authorities. | |||||||||||||
The Company and its subsidiaries file U.S. federal income tax returns and tax returns in various state and foreign jurisdictions. The Company is also open to examination for the years ended 2000 and forward with respect to NOLs generated and carried forward from those years. The Company is open to examination by foreign jurisdictions for tax years 2011 forward. | |||||||||||||
Certain Taxes Payable Irrespective of NOLs—Under the Internal Revenue Code and related Treasury Regulations, the Company may “carry forward” its NOLs in certain circumstances to offset current and future income and thus reduce its federal income tax liability, subject to certain restrictions. To the extent that the NOLs do not otherwise become limited, the Company believes that it will be able to carry forward a significant amount of NOLs. However, these NOLs will not impact all taxes to which the Company may be subject. For instance, state or foreign income taxes and/or revenue based taxes may be payable if the Company’s income or revenue is attributed to jurisdictions that impose such taxes; the Company’s NOLs do not entirely offset its income for alternative minimum tax; and the NOLs will not offset federal personal holding company tax liability that Pendrell or one or more of its corporate subsidiaries may incur. This is not an exhaustive list, but merely illustrative of the types of taxes to which the Company’s NOLs are not applicable. | |||||||||||||
Personal Holding Company Determination—The Internal Revenue Code imposes an additional tax on the undistributed income of personal holding companies. A personal holding company is a corporation with five or fewer individual shareholders whose ownership exceeds 50% of the corporation’s outstanding shares, measured by share value (“Concentrated Ownership”), and which generates personal holding company income (“PHCI”) that constitutes 60% or more of its adjusted ordinary gross income. Broadly, PHCI includes such things as dividends, interest, rents and royalties. For a corporate subsidiary, Concentrated Ownership is determined by reference to ownership of the parent corporation(s), and the subsidiary’s income is subject to additional tests to determine whether the income renders the subsidiary a personal holding company. Due to the significant number of shares held by the Company’s largest shareholders and the type of income that the Company generates, the Company must continually assess share ownership of Pendrell and its consolidated subsidiary ContentGuard to determine whether or not there is Concentrated Ownership of either corporation. | |||||||||||||
In the year ended December 31, 2014, the Company determined that ContentGuard was not a personal holding company through 2014. The Company also determined that Pendrell, the parent company, met the Concentrated Ownership test through 2014. However, Pendrell did not have sufficient PHCI to create a PCH tax obligation. The Company does not anticipate any resulting PHC tax liability for current or prior years. If either Pendrell or ContentGuard is determined to be a PHC in the future, generates net PHCI, and does not distribute to its shareholders a proportionate dividend in the full amount of the net PHCI, then the undistributed net PHCI will be taxed (at 20% under current law). | |||||||||||||
Tax Benefits Preservation Plan—Effective January 29, 2010, the Board of Directors adopted the Tax Benefits Preservation Plan to help the Company preserve its ability to utilize fully its NOLs and to help preserve potential future NOLs. As discussed above, if the Company experiences a “Tax Ownership Change,” as defined in Section 382 of the Internal Revenue Code, the Company’s ability to use the NOLs could be significantly limited. | |||||||||||||
The Tax Benefits Plan is intended to act as a deterrent to any person or group acquiring, without the approval of the Company’s Board of Directors, beneficial ownership of 4.9% or more of the Company’s securities, defined to include: (i) shares of its Class A common stock and Class B common stock, (ii) shares of its preferred stock, (iii) warrants, rights, or options to purchase its securities, and (iv) any interest that would be treated as “stock” of the Company for purposes of Section 382 or pursuant to Treasury Regulation § 1.382-2T(f)(18). | |||||||||||||
Holders of 4.9% or more of the Company’s securities outstanding as of the close of business on January 29, 2010 will not trigger the Tax Benefits Plan so long as they do not (i) acquire additional securities constituting one-half of one percent (0.5%) or more of the Company’s securities outstanding as of the date of the Tax Benefits Plan (as adjusted to reflect any stock splits, subdivisions and the like), or (ii) fall under 4.9% ownership of the Company’s securities and then re-acquire securities that increase their ownership to 4.9% or more of the Company’s securities. The Board of Directors may exempt certain persons whose acquisition of securities is determined by the Board of Directors not to jeopardize the Company’s tax benefits or to otherwise be in the best interest of the Company and its shareholders. The Board of Directors may also exempt certain transactions. |
Employee_Benefits
Employee Benefits | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Postemployment Benefits [Abstract] | |||||||||||||
Employee Benefits | 13. Employee Benefits | ||||||||||||
The Company provides its eligible employees with medical and dental benefits, insurance arrangements to cover death in service, long-term disability and personal accident, as well as a defined contribution retirement plan. Expense related to contributions by the Company under the defined contribution retirement plan included in general and administrative expenses in the Company’s consolidated statements of operations for the years ended December 31, 2014, 2013 and 2012 was as follows (in thousands): | |||||||||||||
Year ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Defined contribution expenses | $ | 264 | $ | 291 | $ | 242 |
Related_Parties
Related Parties | 12 Months Ended |
Dec. 31, 2014 | |
Related Party Transactions [Abstract] | |
Related Parties | 14. Related Parties |
The Company considers its related parties to be its principal shareholders and their affiliates. | |
Eagle River Satellite Holdings, LLC (“ERSH”), Eagle River Investments, Eagle River, Inc. and Eagle River Partners, LLC (“ERP”)—ERSH is the Company’s controlling shareholder. ERSH, together with its affiliates Eagle River Investments, LLC, Eagle River, Inc. and ERP (collectively, “Eagle River”) holds an economic interest of approximately 33.3% of the Company’s outstanding common stock and a voting interest of approximately 65.1% in the Company as of December 31, 2014. On November 26, 2012, Eagle River Investments, LLC exercised warrants to purchase three million shares of the Company’s Class A common stock at an exercise price of $0.01 per share. | |
Prior to July 2012, the Company subleased from Eagle River, Inc. the office space for the Company’s headquarters in Kirkland, Washington. The sublease was a pass-through agreement, pursuant to which the Company paid rent to Eagle River, Inc. and reimbursed costs and expenses to Eagle River, Inc. that Eagle River, Inc. paid to its third-party landlord. The sublease expired contemporaneously with the expiration of the underlying prime lease in July 2012. Payments made to Eagle River, Inc. under this agreement during the year ended December 31, 2012 totaled $0.2 million. |
Quarterly_Financial_Data
Quarterly Financial Data | 12 Months Ended | ||||||||||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||
Quarterly Financial Data | 15. Quarterly Financial Data (Unaudited) | ||||||||||||||||||||||||||||||||
The following table contains selected unaudited statement of operations information for each quarter of the years ended December 31, 2014 and 2013. The quarterly financial data reflects all normal recurring adjustments necessary for a fair presentation of the information for the periods presented. The operating results for any quarter are not necessarily indicative of results for any future period. | |||||||||||||||||||||||||||||||||
In 2013, the Company established a bonus plan to award annual bonuses based on objectives established by the Company’s compensation committee. During the year, operational and financial performance was measured against the established performance objectives to determine the potential bonus payout. Although the Company believes it made significant progress in 2013, it did not meet certain of the objectives set forth in the bonus plan. Accordingly, during the fourth quarter of the year ended December 31, 2013, the Company decreased its estimate of the potential bonus payout as a result of not achieving certain of its 2013 performance objectives. | |||||||||||||||||||||||||||||||||
The Company’s bonus accrual at September 30, 2013 was $2.6 million. As a result of the change in estimate, the full-year accrual was reduced to $1.2 million at December 31, 2013. In prior quarters, the Company had expensed on average just under $0.9 million per quarter related to bonuses in general and administrative expenses. The change in estimate created a credit of $1.4 million in general and administrative expenses in the fourth quarter related to the potential bonus payout; or a swing of approximately $2.3 million less expense as compared to the average in the prior three quarters. | |||||||||||||||||||||||||||||||||
Unaudited quarterly results were as follows (in thousands, except per share data): | |||||||||||||||||||||||||||||||||
Three months ended | |||||||||||||||||||||||||||||||||
March 31, | June 30, | September 30, | December 31, | ||||||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||||||
Revenue | $ | 38,135 | $ | 10,992 | $ | 2,935 | $ | 802 | $ | 618 | $ | 781 | $ | 846 | $ | 553 | |||||||||||||||||
Operating income (loss) | 7,134 | (13,053 | ) | (13,563 | ) | (16,739 | ) | (14,096 | ) | (15,037 | ) | (31,191 | ) | (13,032 | ) | ||||||||||||||||||
Net income (loss) | 815 | (13,040 | ) | (13,588 | ) | (16,783 | ) | (14,117 | ) | (15,071 | ) | (31,244 | ) | (13,086 | ) | ||||||||||||||||||
Net income (loss) attributable to Pendrell | 1,730 | (12,366 | ) | (12,595 | ) | (15,822 | ) | (13,262 | ) | (14,228 | ) | (26,875 | ) | (12,646 | ) | ||||||||||||||||||
Basic income (loss) per share attributable to Pendrell | $ | 0.01 | $ | (0.05 | ) | $ | (0.05 | ) | $ | (0.06 | ) | $ | (0.05 | ) | $ | (0.05 | ) | $ | (0.10 | ) | $ | (0.05 | ) | ||||||||||
Diluted income (loss) per share attributable to Pendrell | $ | 0.01 | $ | (0.05 | ) | $ | (0.05 | ) | $ | (0.06 | ) | $ | (0.05 | ) | $ | (0.05 | ) | $ | (0.10 | ) | $ | (0.05 | ) |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Accounting Policies [Abstract] | |||||||||||||
Principles of Consolidation and Basis of Presentation | Principles of Consolidation and Basis of Presentation—The consolidated financial statements of the Company include the assets and liabilities of its wholly-owned subsidiaries and subsidiaries it controls or in which it has a controlling financial interest. Noncontrolling interests on the consolidated balance sheets include third-party investments in entities that the Company consolidates, but does not wholly own. Noncontrolling interests are classified as part of equity and the Company allocates net income (loss), other comprehensive income (loss) and other equity transactions to its noncontrolling interests in accordance with their applicable ownership percentages. All intercompany transactions and balances have been eliminated in consolidation. All information in these financial statements is in U.S. dollars. These financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). | ||||||||||||
Segment Information | Segment Information—The Company operates in and reports on one segment (IP management). Operating segments are based upon the Company’s internal organization structure, the manner in which its operations are managed, and the criteria used by its Chief Operating Decision Maker. Substantially all of the Company’s revenue are generated by operations located within the United States, and the Company does not have any long-lived assets located in foreign countries. | ||||||||||||
Use of Estimates | Use of Estimates—The preparation of financial statements in conformity with GAAP requires management 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 amounts of revenues and expenses during the reporting period. Actual results could differ materially from these estimates. | ||||||||||||
On an ongoing basis, the Company evaluates its estimates, including among others, those related to the fair value of acquired intangible assets and goodwill, the useful lives and potential impairment of intangible assets and property and equipment, the value of stock awards for the purpose of determining stock-based compensation expense, accrued liabilities (including bonus accruals), valuation allowances related to the ability to realize deferred tax assets, allowances for doubtful receivables and certain tax liabilities. Estimates are based on historical experience and other factors, including the current economic environment as deemed appropriate under the circumstances. Estimates and assumptions are adjusted when facts and circumstances dictate. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates. Any changes in estimates used to prepare these financial statements will be reflected in the financial statements in future periods. | |||||||||||||
Reclassifications | Reclassifications—Certain prior period amounts have been reclassified to conform to current year presentation. The reclassifications had no effect on previously reported net loss of the Company or the noncontrolling interest holder. Such reclassifications relate to the Company’s presentation of expenses in its consolidated statements of operations, including the presentation of “cost of revenues” and “patent litigation” as separate captions; as such costs were previously included in “patent administration, litigation and related costs” and “general and administrative.” The following is a summary of the revised expense categories: | ||||||||||||
Cost of revenue | Cost of revenue—Cost of revenue consists of certain costs that are variable in nature and are directly attributable to the Company’s revenue generating activities including (i) payments to third parties to whom the Company has an obligation to share revenue, (ii) commissions, and (iii) success fees. Additionally, in periods when patent sales occur, cost of revenue includes the net book value and other related costs associated with the sold patents. Depending on the patents being monetized, revenue share payments as a percentage of revenues may vary significantly. | ||||||||||||
Patent administration and related costs | Patent administration and related costs—Patent administration and related costs are comprised of (i) patent-related maintenance and prosecution costs incurred to maintain the Company’s patents, (ii) other costs that support its patent monetization efforts, and (iii) costs associated with the abandonment of patents, including the write-off of any remaining net book value. | ||||||||||||
Patent litigation | Patent litigation—Patent litigation costs consist of costs and expenses incurred in connection with the Company’s patent-related enforcement and litigation activities. These may include non-contingent or contingent fee obligations to external counsel. | ||||||||||||
General and administrative | General and administrative—General and administrative expenses are primarily comprised of (i) personnel costs, (ii) general legal fees, (iii) professional fees, (iv) acquisition investigation costs, and (v) general office related costs. | ||||||||||||
Cash and Cash Equivalents | Cash and Cash Equivalents—Cash and cash equivalents are defined as short-term, highly liquid investments with original maturities from the date of purchase of 90 days or less. Cash and cash equivalents are comprised of the following (in thousands): | ||||||||||||
December 31, | |||||||||||||
2014 | 2013 | ||||||||||||
Cash | $ | 18,403 | $ | 18,043 | |||||||||
Money market funds | 150,390 | 166,524 | |||||||||||
$ | 168,793 | $ | 184,567 | ||||||||||
The fair value of money market funds at December 31, 2014 and 2013 was classified as Level 1 in the hierarchy established by the Financial Accounting Standards Board (“FASB”) as amounts were based on quoted prices available in active markets for identical investments as of the reporting date. | |||||||||||||
Accounts Receivable | Accounts Receivable—Accounts receivable consists of amounts billed to customers under licensing arrangements, patent sales arrangements or consulting services. The majority of the Company’s customers are well-established operating companies with investment-grade credit. For the periods ended December 31, 2014 and December 31, 2013, the Company did not incur any losses on its accounts receivable. Based upon historical collections experience and specific client information, the Company has determined that an allowance for doubtful accounts was not required at either December 31, 2014 or December 31, 2013. Carrying amounts of such receivables approximate their fair value due to their short-term nature. | ||||||||||||
Other Receivables | Other Receivables—As of December 31, 2014 and 2013 the Company recorded a receivable due from Jay & Jayendra (Pty) Ltd, a South African corporation or its designated affiliate (collectively, the “J&J Group”) for reimbursement of operating expenses related to the Company’s MEO Assets of $2.7 million and a corresponding full reserve against the receivable as a result of the J&J Group’s failure to fulfill its obligation to reimburse the Company. The Company has obtained an enforcement judgment in South Africa (where J&J Group is domiciled), but due to the uncertainty of collection, the Company continues to maintain a full reserve against the receivable. Other receivables also include amounts for state income taxes, interest and other miscellaneous items. | ||||||||||||
Prepaid Expenses and Other Current Assets | Prepaid Expenses and Other Current Assets—As of December 31, 2014 and 2013 prepaid expenses and other current assets consisted primarily of insurance prepayments and prepayments related to rent and security deposits associated with certain of the Company’s leased facilities. | ||||||||||||
Property in Service | Property in Service—Property in service consists primarily of computer equipment, software, furniture and fixtures and leasehold improvements. Property in service is recorded at cost, net of accumulated depreciation, and is depreciated using the straight-line method. Computer equipment and furniture and fixtures are depreciated over their estimated useful lives ranging from three to five years. Software is depreciated over the shorter of its contractual license period or three years. Leasehold improvements are amortized over the shorter of their estimated useful lives or the term of the respective lease. Significant additions and improvements to property in service are capitalized. Repair and maintenance costs are expensed as incurred. | ||||||||||||
Other Assets | Other Assets—As of December 31, 2014 and 2013, other assets consisted primarily of long-term security deposits associated with the Company’s leased facilities. | ||||||||||||
Business Combinations | Business Combinations—The Company accounts for business combinations using the acquisition method and, accordingly, the identifiable assets acquired and liabilities assumed are recorded at their acquisition date fair values. This valuation requires management to make significant estimates and assumptions, especially with respect to intangible assets. Valuation methodologies may include the cost, market or income approach. Critical estimates in valuing intangible assets include but are not limited to estimates about: future expected cash flows from customers, proprietary technology, the acquired company’s brand awareness and market position and discount rates. The estimates are based upon assumptions the Company believes to be reasonable, but which are inherently uncertain and unpredictable. Goodwill is calculated as the excess of the purchase price over the fair value of net assets, including the amount assigned to identifiable intangible assets. Subsequent changes to assets, liabilities, valuation allowance or uncertain tax positions that relate to the acquired company and existed at the acquisition date that occur both within the measurement period and as a result of new information about facts and circumstances that existed at the acquisition date are recognized as an adjustment to goodwill. Acquisition-related costs, including advisory, legal, accounting, valuation and other costs, are expensed in the periods in which the costs are incurred. The results of operations of acquired businesses are included in the consolidated financial statements from the acquisition date. | ||||||||||||
Intangible Assets and Goodwill | Intangible Assets and Goodwill— The Company amortizes finite-lived intangible assets, including patents, acquired in purchase transactions over their expected useful lives. The Company assigns goodwill and indefinite-lived intangible assets to its reporting units based on the expected benefit from the synergies arising from each business combination. | ||||||||||||
The Company evaluates finite-lived intangible assets when events or circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. These events or circumstances could include: a significant change in the business climate, legal factors, operating performance indicators, or changes in technology or customer requirements. Recoverability of an asset or asset group is measured by a comparison of the carrying amount to the future undiscounted net cash flows expected to be generated by the asset or asset group over its life. This comparison requires management to make judgments regarding estimated future cash flows. The Company’s ability to realize the estimated future cash flows may be affected by factors such as changes in operating performance, changes in business strategy, invalidation of patents, unfavorable judgments in legal proceedings and changes in economic conditions. If the Company’s estimates of the undiscounted cash flows do not equal or exceed the carrying value of the asset or asset group, an impairment charge equal to the amount by which the recorded value of the asset or asset group exceeds its fair value is recognized. | |||||||||||||
The Company evaluates goodwill for impairment on an annual basis during the fourth quarter, or more frequently if circumstances indicate that the carrying value of a Company reporting unit exceeds fair value. When evaluating goodwill and indefinite-lived intangible assets for impairment, the Company first performs a qualitative assessment to determine if fair value of the reporting unit is more likely than not greater than the carrying amount. If this assessment indicates that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, then the Company further evaluates the estimated fair value of the reporting unit through the use of discounted cash flow models, which requires management to make significant judgments as to the estimated future cash flows utilized. The Company’s ability to realize the future cash flows utilized in its fair value calculations may be affected by factors such as changes in its operating performance, changes in its business strategy, invalidation of its patents, unfavorable judgments in legal proceedings and changes in economic conditions. The results of the models are compared to the carrying amount of the reporting unit. If such comparison indicates that the fair value of the reporting unit is lower than the carrying amount, impairment would exist and the impairment charge would be measured by comparing the implied fair value of the reporting unit’s goodwill to its carrying value. | |||||||||||||
In January 2015, the Company suspended further development of its proprietary micro-propagation technology and related laboratory processes that are designed to facilitate production on a commercial scale of certain plants, particularly timber bamboo. Although the Company continued to pursue revenue generating business opportunities through the fourth quarter, it was unable to identify opportunities to commercialize the technology. The Company determined that the suspension of technology development provided additional evidence about conditions that existed prior to December 31, 2014. Accordingly, the Company took an $11.0 million impairment charge during the fourth quarter of its year ended December 31, 2014. The charge is equal to the sum of its unamortized investment in its developed Provitro™ technology and the goodwill associated with its February 21, 2013 acquisition of Provitro Biosciences LLC (“Provitro”). | |||||||||||||
For the years ended December 31, 2013 and 2012, the Company recorded no such impairment charges. | |||||||||||||
Fair Value of Financial Instruments | Fair Value of Financial Instruments—The Company determines the fair value of its financial instruments based on the fair value hierarchy established by the FASB. The three levels of inputs used to measure fair value are as follows: | ||||||||||||
Level 1—Quoted prices in active markets for identical assets and liabilities. | |||||||||||||
Level 2—Quoted prices in active markets for similar assets and liabilities or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. | |||||||||||||
Level 3—Unobservable inputs that are supported by little or no market activity and are significant to the fair value of the assets and liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. | |||||||||||||
As of December 31, 2014 and 2013, the Company’s financial instruments included its cash and cash equivalents, accounts receivable, other receivables, accounts payable and certain other assets and liabilities. The Company determines the carrying value of its financial instruments, based on the hierarchy established by the FASB, approximate the fair value of the financial instruments as they are equivalent to cash or due to their short-term nature. | |||||||||||||
Foreign Currency Translation and Foreign Currency Transactions and Accumulated Other Comprehensive Income (Loss) | Foreign Currency Translation and Foreign Currency Transactions and Accumulated Other Comprehensive Income (Loss)—The reporting currency for the Company’s operations is U.S. dollars. The Company translates the activities of its subsidiaries with functional currencies other than the U.S. dollar at the average exchange rate prevailing during the period. Gains and losses on foreign currency transactions are recognized as a component of other income (expense) in the consolidated statements of operations in the period in which they occur. Assets and liabilities denominated in foreign currencies are translated at the exchange rates prevailing at the balance sheet date. Translation adjustments resulting from these processes are recognized as a component of accumulated other comprehensive income (loss). | ||||||||||||
For the years ended, December 31, 2014 and 2013, there were no gains or losses on intercompany foreign currency translations. For the year ended December 31, 2012, gains on intercompany foreign currency translations of $0.1 million have been excluded from net income (loss) and reported as a component of accumulated other comprehensive income (loss) due to their long-term investment nature. | |||||||||||||
The Company recognizes applicable cumulative translation adjustments as a component of other operating income (loss) in the period in which a subsidiary is substantially liquidated or deconsolidated. For the year ended December 31, 2014 and 2013, there were no reclassifications of cumulative translation gains or losses resulting from the deconsolidation or liquidation of subsidiaries. For the year ended December 31, 2012, the Company reclassed net loss of $12.7 resulting from the deconsolidation of its International Subsidiaries. | |||||||||||||
The Company had no accumulated other comprehensive income or (loss) as of December 31, 2014 and 2013 due to the deconsolidation of the Company’s International Subsidiaries effective June 29, 2012. | |||||||||||||
Revenue Recognition | Revenue Recognition— The Company derives its operating revenue from IP monetization activities, including patent licensing and patent sales, and from IP consulting services. Although the Company’s revenue may occur in different forms, it regards its IP monetization activities as integrated and not separate revenue streams. For example, a third party relationship could involve consulting and licensing activities, or the acquisition of a patent portfolio can lead to licensing, consulting and patent sales revenue. | ||||||||||||
The Company’s patent licensing agreements often provide for the payment of contractually determined upfront license fees representing all or a majority of the revenue that will be generated from such agreements for nonexclusive, nontransferable, limited duration licenses. These agreements typically grant (i) a nonexclusive license to make, sell, distribute, and use certain specified products that read on the Company’s patents, (ii) a covenant not to enforce patent rights against the licensee based on such activities, and (iii) the release of the licensee from certain claims. | |||||||||||||
Certain of the Company’s patent licensing agreements provide for future royalties or future payment obligations triggered upon satisfaction of conditions. Future royalties and future payments are recognized in revenue upon satisfaction of any related conditions, provided that all revenue recognition criteria, as described below, have been met. | |||||||||||||
The Company sells patents from its portfolios from time to time. These sales are part of the Company’s ongoing operations. Consequently, the related proceeds are recorded as revenue. | |||||||||||||
The timing and amount of revenue recognized from IP monetization activities depend on the specific terms of each agreement and the nature of the deliverables and obligations. Fees earned from IP consulting services are generally recognized as the services are performed. For agreements that are deemed to contain multiple elements, consideration is allocated to each element of an agreement that has stand-alone value using the relative fair value method. The Company recognizes revenue when (i) persuasive evidence of an arrangement exists, (ii) all material obligations have been substantially performed pursuant to agreement terms, services have been rendered to the customer or delivery has occurred, (iii) amounts are fixed or determinable, and (iv) collectability is reasonably assured. As a result of the contractual terms of our patent monetization agreements and the unpredictable nature, form and frequency of monetizing transactions, our revenue may fluctuate substantially from period to period. | |||||||||||||
Research and Development | Research and Development—The Company incurs costs associated with research and development activities and expenses the costs in the period incurred. Research and development expenses during the period were not material for separate disclosure and are included in general and administrative expenses. | ||||||||||||
Stock-Based Compensation | Stock-Based Compensation—The Company records stock-based compensation on stock options, stock appreciation rights, restricted stock awards, restricted stock units and other stock awards issued to employees, directors, consultants and/or advisors based on the estimated fair value on the date of grant and recognizes compensation cost over the requisite service period for awards expected to vest. The fair value of stock options and stock appreciation rights is estimated on the date of grant using the Black-Scholes option pricing model (“Black-Scholes Model”) based on the single option award approach. The fair value of restricted stock awards and restricted stock units is determined based on the number of shares granted and either the quoted market price of the Company’s Class A common stock on the date of grant for time-based and performance-based awards, or the fair value on the date of grant using the Monte Carlo Simulation model (“Monte Carlo Simulation”) for market-based awards. The fair value of stock options, restricted stock awards and restricted stock units with service conditions are amortized to expense on a straight-line basis over the requisite service periods of the awards, which is generally the vesting period. The fair value of stock options, stock appreciation rights, restricted stock awards and restricted stock units with performance conditions deemed probable of being achieved and cliff vesting is amortized to expense over the requisite service period using the straight-line method of expense recognition. The fair value of restricted stock awards and restricted stock units with performance and market conditions are amortized to expense over the requisite service period using the straight-line method of expense recognition. The fair value of stock-based payment awards as determined by the Black-Scholes Model and the Monte Carlo Simulation are affected by the Company’s stock price as well as other assumptions. These assumptions include, but are not limited to, the expected stock price volatility over the term of the awards and actual and projected employee stock option exercise behaviors. Forfeitures are estimated at the date of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. | ||||||||||||
The Company accounts for the modification of the terms or conditions of a stock-based payment award as an exchange of the original award for a new award. Compensation expense for modified stock-based payment awards is equal to the fair value of the original award plus the incremental cost conveyed as a result of the modification expensed over the remaining life of the award. | |||||||||||||
Income Taxes | Income Taxes—The Company accounts for income taxes using the asset and liability method under which deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to reverse. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that includes the enactment date. A valuation allowance against deferred tax assets (“DTAs”) is recorded when it is more likely than not that the assets will not be realized. | ||||||||||||
The Company records an unrecognized 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 tax authorities. The Company’s policy is to recognize interest and/or penalties related to unrecognized tax benefits as income tax expense. | |||||||||||||
Contingencies | Contingencies—Outcomes of legal proceedings and claims brought by and against the Company are subject to significant uncertainty. The Company accrues an estimated loss from a loss contingency, such as a legal claim, by a charge to income if it is probable that an asset has been impaired or a liability has been incurred and the amount of the loss can be reasonably estimated. The Company discloses a contingency if there is at least a reasonable possibility that a loss has been incurred. In determining whether a contingent loss should be accrued or disclosed, the Company evaluates, among other factors, the degree of probability of an unfavorable outcome and the ability to make a reasonable estimate of the amount of loss. Changes in these factors could materially impact the Company’s financial position, results of operations or cash flows. For contingencies that might result in a gain, the Company does not record the gain until realized. | ||||||||||||
Income (Loss) Per Share | Income (Loss) Per Share—Basic income (loss) per share is calculated based on the weighted average number of Class A common stock and Class B common stock (the “Common Shares”) outstanding during the period. Diluted income (loss) per share is calculated by dividing the income (loss) allocable to common shareholders by the weighted average Common Shares outstanding plus dilutive potential Common Shares. Prior to the satisfaction of vesting conditions, unvested restricted stock awards are considered contingently issuable and are excluded from weighted average Common Shares outstanding used for computation of basic income (loss) per share. | ||||||||||||
Potential dilutive Common Shares consist of the incremental Class A common stock issuable upon the exercise of outstanding stock options (both vested and non-vested), stock appreciation rights, warrants, and unvested restricted stock awards and units, calculated using the treasury stock method. The calculation of dilutive shares outstanding excludes out-of-the-money stock options (i.e., such options’ exercise prices were greater than the average market price of the Company’s Class A common shares for the period) because their inclusion would have been antidilutive. | |||||||||||||
The following table sets forth the computation of basic and diluted income (loss) per share (in thousands, except share and per share data): | |||||||||||||
Year ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Net income (loss) attributable to Pendrell | $ | (51,002 | ) | $ | (55,062 | ) | $ | 40,084 | |||||
Weighted average common shares outstanding | 266,336,617 | 265,684,341 | 261,335,347 | ||||||||||
Less: weighted average unvested restricted stock awards | (1,929,119 | ) | (3,564,938 | ) | (4,380,344 | ) | |||||||
Shares used for computation of basic income (loss) per share | 264,407,498 | 262,119,403 | 256,955,003 | ||||||||||
Add back: weighted average unvested restricted stock awards and units | — | — | 4,977,877 | ||||||||||
Add back: dilutive stock options and stock appreciation rights | — | — | 1,891,399 | ||||||||||
Shares used for computation of diluted income (loss) per share(1) | 264,407,498 | 262,119,403 | 263,824,279 | ||||||||||
Basic income (loss) per share attributable to Pendrell | $ | (0.19 | ) | $ | (0.21 | ) | $ | 0.16 | |||||
Diluted income (loss) per share attributable to Pendrell | $ | (0.19 | ) | $ | (0.21 | ) | $ | 0.15 | |||||
-1 | Stock options, stock appreciation rights, restricted stock awards and units totaling 28,113,540, 34,408,579 and 26,593,976 for the years ended December 31, 2014, 2013 and 2012, respectively, were excluded from the calculation of diluted income (loss) per share as their inclusion was anti-dilutive. | ||||||||||||
New Accounting Pronouncements | New Accounting Pronouncements—In August 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, which requires management to assess an entity’s ability to continue as a going concern every reporting period including interim periods, and to provide related footnote disclosure in certain circumstances. Compliance with this ASU is required for annual periods beginning after December 15, 2016. Early adoption is permitted. The adoption of this ASU in 2014 did not have an impact on the Company’s financial position, results of operations or cash flows. | ||||||||||||
In June 2014, the FASB issued ASU No. 2014-12, Compensation-Stock Compensation (Topic 718)—Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (a consensus of the FASB Emerging Issues Task Force). ASU No. 2014-12 requires that a performance target that affects vesting and could be achieved after the requisite service period shall be treated as a performance condition. Compliance with this ASU is required for annual periods beginning after December 15, 2015. Early adoption is permitted. The adoption of this ASU in 2014 did not have a material impact on the Company’s financial position, results of operations or cash flows. | |||||||||||||
In May 2014, the FASB issued ASU No. 2014-09, Revenue (Topic 606): Revenue from Contracts with Customers, which supersedes existing revenue recognition guidance under GAAP. The core principle of ASU 2014-09 is to recognize as revenue the amount that an entity expects to be entitled for goods or services at the time the goods or services are transferred to customers. ASU 2014-09 defines a five step process to achieve this core principle that will likely require more judgment and estimates within the revenue recognition process than are required under existing GAAP. Compliance with this ASU is required for annual periods beginning after December 15, 2016, and interim periods therein. Early adoption is not permitted. The Company is currently assessing the impact, if any, of implementing this ASU. |
Summary_of_Significant_Account2
Summary of Significant Accounting Policies (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Accounting Policies [Abstract] | |||||||||||||
Summary of Cash and Cash Equivalents | Cash and cash equivalents are comprised of the following (in thousands): | ||||||||||||
December 31, | |||||||||||||
2014 | 2013 | ||||||||||||
Cash | $ | 18,403 | $ | 18,043 | |||||||||
Money market funds | 150,390 | 166,524 | |||||||||||
$ | 168,793 | $ | 184,567 | ||||||||||
Computation of Basic and Diluted Income (Loss) Per Share | The following table sets forth the computation of basic and diluted income (loss) per share (in thousands, except share and per share data): | ||||||||||||
Year ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Net income (loss) attributable to Pendrell | $ | (51,002 | ) | $ | (55,062 | ) | $ | 40,084 | |||||
Weighted average common shares outstanding | 266,336,617 | 265,684,341 | 261,335,347 | ||||||||||
Less: weighted average unvested restricted stock awards | (1,929,119 | ) | (3,564,938 | ) | (4,380,344 | ) | |||||||
Shares used for computation of basic income (loss) per share | 264,407,498 | 262,119,403 | 256,955,003 | ||||||||||
Add back: weighted average unvested restricted stock awards and units | — | — | 4,977,877 | ||||||||||
Add back: dilutive stock options and stock appreciation rights | — | — | 1,891,399 | ||||||||||
Shares used for computation of diluted income (loss) per share(1) | 264,407,498 | 262,119,403 | 263,824,279 | ||||||||||
Basic income (loss) per share attributable to Pendrell | $ | (0.19 | ) | $ | (0.21 | ) | $ | 0.16 | |||||
Diluted income (loss) per share attributable to Pendrell | $ | (0.19 | ) | $ | (0.21 | ) | $ | 0.15 | |||||
-1 | Stock options, stock appreciation rights, restricted stock awards and units totaling 28,113,540, 34,408,579 and 26,593,976 for the years ended December 31, 2014, 2013 and 2012, respectively, were excluded from the calculation of diluted income (loss) per share as their inclusion was anti-dilutive. |
Business_Combinations_Tables
Business Combinations (Tables) | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Business Combinations [Abstract] | |||||
Summary of Cash Paid for Assets Acquired and Liabilities Assumed | The following table summarizes the allocation of the $16.6 million cash paid for the assets acquired and liabilities assumed as a result of the Provitro acquisition on February 21, 2013 (in thousands): | ||||
Tangible assets acquired and liabilities assumed: | |||||
Cash | $ | 7,396 | |||
Other current and noncurrent assets, net of liabilities | 430 | ||||
Property in service | 2,950 | ||||
Net tangible assets acquired | 10,776 | ||||
Identifiable intangible assets (developed technology) | 12,853 | ||||
Goodwill | 516 | ||||
Fair value of assets acquired | 24,145 | ||||
Fair value of 31.25% noncontrolling interest | (7,545 | ) | |||
Total purchase price | $ | 16,600 | |||
Intangible_Assets_and_Goodwill1
Intangible Assets and Goodwill (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||
Intangible Assets and Related Amortization | The following table presents details of the Company’s intangible assets and related amortization (in thousands): | ||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Cost: | |||||||||
Patents | $ | 139,902 | $ | 144,739 | |||||
Developed technology(1) | — | 12,853 | |||||||
Customer relationships | 6,615 | 6,615 | |||||||
Trade names | 4,812 | 4,812 | |||||||
Trade secrets | 1,940 | 1,940 | |||||||
Total cost | 153,269 | 170,959 | |||||||
Accumulated amortization: | |||||||||
Patents | (40,321 | ) | (27,925 | ) | |||||
Developed technology(1) | — | (1,071 | ) | ||||||
Customer relationships | (2,680 | ) | (1,872 | ) | |||||
Trade names | — | — | |||||||
Trade secrets | (566 | ) | (404 | ) | |||||
Total accumulated amortization | (43,567 | ) | (31,272 | ) | |||||
Intangible assets, net | $ | 109,702 | $ | 139,687 | |||||
-1 | The Company recorded a non-cash impairment charge of $10.5 million related to Provitro’s developed technology reducing the carrying value to zero during the fourth quarter of the year ended December 31, 2014. | ||||||||
Expected Period of Benefit of Intangible Assets with Finite Useful Lives | The following table presents the expected period of benefit of the Company’s intangible assets with finite useful lives: | ||||||||
Weighted | |||||||||
Average Lives | |||||||||
Patents | 10 years | ||||||||
Customer relationships | 9 years | ||||||||
Trade secrets | 12 years | ||||||||
Estimated Future Amortization Expense of Purchased Intangible Assets | The estimated future amortization expense of purchased intangible assets as of December 31, 2014 is as follows (in thousands): | ||||||||
Year ending December 31, | Amount | ||||||||
2015 | $ | 14,332 | |||||||
2016 | 14,371 | ||||||||
2017 | 14,147 | ||||||||
2018 | 13,966 | ||||||||
2019 | 13,781 | ||||||||
Thereafter | 34,293 | ||||||||
Total | $ | 104,890 | |||||||
Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill for the years ended December 31, 2014 and 2013 are as follows (in thousands): | ||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Beginning balance | $ | 21,725 | $ | 21,209 | |||||
Impairment of goodwill | (516 | ) | — | ||||||
Acquisition of Provitro | — | 516 | |||||||
Ending balance | $ | 21,209 | $ | 21,725 | |||||
Accrued_expenses_Tables
Accrued expenses (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Payables and Accruals [Abstract] | |||||||||
Summary of Accrued Expenses | The following table summarizes accrued expenses (in thousands): | ||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Accrued payroll and related expenses | $ | 2,570 | $ | 2,242 | |||||
Accrued legal, professional and other expenses | 3,254 | 3,429 | |||||||
$ | 5,824 | $ | 5,671 | ||||||
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||
Rental Expense | Total rental expense included in general and administrative expenses in the Company’s consolidated statements of operations for the years ended December 31, 2014, 2013 and 2012 was as follows (in thousands): | ||||||||||||
Year ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Rent expense | $ | 662 | $ | 875 | $ | 637 | |||||||
Future Minimum Payment Under Lease Agreements | As of December 31, 2014, future minimum payments under the Company’s lease agreements were as follows (in thousands): | ||||||||||||
Operating | |||||||||||||
leases | |||||||||||||
2015 | $ | 626 | |||||||||||
2016 | 612 | ||||||||||||
2017 | 591 | ||||||||||||
2018 | 425 | ||||||||||||
2019 | 205 | ||||||||||||
Total minimum payments | $ | 2,459 | |||||||||||
Shareholders_Equity_Tables
Shareholders' Equity (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||
Stock-Based Compensation Expense Included in Consolidated Statements of Operations | Stock-based compensation expense included in the Company’s consolidated statements of operations for the years ended December 31, 2014, 2013 and 2012 was as follows (in thousands): | ||||||||||||||||||||
Year ended December 31, | |||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||
Stock options(1) | $ | 7,268 | $ | 5,723 | $ | 4,564 | |||||||||||||||
Restricted stock awards(1)(2)(3) | 2,137 | 6,622 | 4,033 | ||||||||||||||||||
Total stock-based compensation expense | $ | 9,405 | $ | 12,345 | $ | 8,597 | |||||||||||||||
-1 | On November 19, 2014, Benjamin G. Wolff resigned from his positions as President and Chief Executive Officer of the Company. The Company entered into a separation agreement in accordance with the terms of Mr. Wolff’s Amended and Restated Employment Letter Agreement (the “Agreement”). The Agreement provided for the vesting of all options, shares of restricted stock (“RSAs”) and restricted stock units (“RSUs”) in which Mr. Wolff would have vested had he remained actively employed by the Company through the second anniversary of his resignation, excluding any unvested performance-based RSAs or performance-based RSUs. The Agreement also provided for an extension of the exercise period for Mr. Wolff’s vested stock options until December 15, 2015. The extension of the exercise period is considered a modification and resulted in additional stock-based compensation expense of $0.7 million, as determined using a Black-Scholes model, which was recognized on the modification date as the options were vested pursuant to the Agreement. The accelerated vesting of the options, RSUs and RSAs resulted in $2.1 million of additional stock-based compensation expense in the year ended December 31, 2014. | ||||||||||||||||||||
-2 | Stock-based compensation expense for the year ended December 31, 2014, 2013 and 2012, includes $0.8 million, $0.8 million and $0.6 million of expense, respectively, related to 250,000 Class A common stock restricted stock awards that are required to be treated as a liability. As of December 31, 2014 and 2013, $2.2 million and $1.4 million, respectively, were accrued for such awards. | ||||||||||||||||||||
-3 | In August 2012, the Company’s Board of Directors approved a modification which applied additional alternative vesting criteria to 3,175,000 shares of restricted stock previously granted to 12 employees. As a result of the modification the Company recorded an additional $1.0 million of stock-based compensation expense for the year ended December 31, 2012, which represents the incremental fair value of the modified restricted stock. | ||||||||||||||||||||
Stock-Based Compensation Cost to be Expensed in Future Years Related to Unvested Stock-Based Awards, as Adjusted for Expected Forfeitures | At December 31, 2014, the balance of stock-based compensation cost to be expensed in future years related to unvested stock-based awards, as adjusted for expected forfeitures, is as follows (in thousands): | ||||||||||||||||||||
2015 | $ | 2,894 | |||||||||||||||||||
2016 | 1,428 | ||||||||||||||||||||
2017 | 763 | ||||||||||||||||||||
2018 | 203 | ||||||||||||||||||||
2019 and thereafter | — | ||||||||||||||||||||
$ | 5,288 | ||||||||||||||||||||
Estimated Weighted Average Fair Value of Stock Options and Stock Appreciation Rights Granted Using Black-Scholes Model | The weighted average fair value of stock options and stock appreciation rights granted during the years ended December 31, 2014, 2013 and 2012 was estimated using the Black-Scholes Model with the following assumptions: | ||||||||||||||||||||
Year ended December 31, | |||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||
Weighted average expected volatility | 55 | % | 55 | % | 57 | % | |||||||||||||||
Weighted average risk-free interest rate | 1.9 | % | 1.2 | % | 1.1 | % | |||||||||||||||
Expected dividend yield | 0 | % | 0 | % | 0 | % | |||||||||||||||
Weighted average expected term in years | 6.2 | 5.8 | 6.2 | ||||||||||||||||||
Weighted average estimated fair value per option granted | $ | 0.79 | $ | 0.88 | $ | 0.68 | |||||||||||||||
Stock Options Granted and Stock Appreciation Rights | The Company granted the following stock options and stock appreciation rights to certain employees in connection with their continued or new employment with the Company during the years ended December 31, 2014, 2013 and 2012 (dollars in thousands): | ||||||||||||||||||||
Year ended December 31, | |||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||
Service-based | 4,374,000 | 1,248,000 | 15,450,875 | ||||||||||||||||||
Performance-based | — | 250,000 | — | ||||||||||||||||||
Stock options issued as Board of Director compensation | 300,000 | 300,000 | 300,000 | ||||||||||||||||||
Total granted | 4,674,000 | 1,798,000 | 15,750,875 | ||||||||||||||||||
Fair value of grants | $ | 3,702 | $ | 1,585 | $ | 10,712 | |||||||||||||||
Stock Option and Stock Appreciation Rights Activity | The Company’s stock option and stock appreciation rights activity for the years ended December 31, 2014, 2013 and 2012 is summarized as follows: | ||||||||||||||||||||
Number of | Weighted | Weighted | Aggregate | ||||||||||||||||||
options/SARs | average | average | intrinsic | ||||||||||||||||||
exercise | remaining | value(1) | |||||||||||||||||||
price | life | (in thousands) | |||||||||||||||||||
(in years) | |||||||||||||||||||||
Outstanding at December 31, 2011 | 14,195,000 | $ | 3.23 | ||||||||||||||||||
Granted | 15,750,875 | 1.27 | |||||||||||||||||||
Exercised | (597,875 | ) | 1.25 | ||||||||||||||||||
Forfeited | (862,625 | ) | 3.04 | ||||||||||||||||||
Outstanding at December 31, 2012 | 28,485,375 | 2.19 | |||||||||||||||||||
Granted | 1,798,000 | 1.73 | |||||||||||||||||||
Exercised | (165,312 | ) | 1.13 | ||||||||||||||||||
Forfeited | (1,621,600 | ) | 2.2 | ||||||||||||||||||
Outstanding at December 31, 2013 | 28,496,463 | 2.17 | |||||||||||||||||||
Granted | 4,674,000 | 1.49 | |||||||||||||||||||
Exercised | (992,499 | ) | 1.18 | ||||||||||||||||||
Forfeited(2) | (6,623,938 | ) | 2.65 | ||||||||||||||||||
Outstanding at December 31, 2014(3) | 25,554,026 | $ | 1.96 | 4.93 | $ | 2,494 | |||||||||||||||
Exercisable at December 31, 2014(3) | 16,987,290 | $ | 1.79 | 3.39 | $ | 1,970 | |||||||||||||||
Vested and expected to vest at December 31, 2014(3) | 25,175,679 | $ | 1.96 | 4.88 | $ | 2,468 | |||||||||||||||
-1 | Aggregate intrinsic value represents total pretax intrinsic value (i.e., the difference between the Company’s closing stock price on the last trading day of 2014 and the exercise price, times the number of shares) that would have been received by the option holders had all option holders exercised their stock options and stock appreciation rights on the last business day of the fiscal year. | ||||||||||||||||||||
-2 | In association with the departure of the Company’s former CEO, during the year ended December 31, 2014 an additional 375,000 stock options vested due to accelerated vesting of shares and an additional 375,000 shares forfeited. | ||||||||||||||||||||
-3 | In association with the departure of the Company’s former CEO, and in accordance with the terms of Mr. Wolff’s Agreement, the exercise period for Mr. Wolff’s vested stock options was extended until December 15, 2015. Excluding Mr. Wolff’s 8,927,500 vested options with a weighted average exercise price of $1.42 and a weighted average remaining life of 0.96 years, the weighted average exercise price and weighted average remaining life for all other outstanding, exercisable, and vested and expected to vest options and stock appreciation rights, is as follows: | ||||||||||||||||||||
Number of | Weighted | Weighted | |||||||||||||||||||
Options/ | average | average | |||||||||||||||||||
SARs | exercise | remaining | |||||||||||||||||||
price | life | ||||||||||||||||||||
(in years) | |||||||||||||||||||||
Outstanding at December 31, 2014 | 16,626,526 | $ | 2.24 | 7.06 | |||||||||||||||||
Exercisable at December 31, 2014 | 8,059,790 | 2.19 | 6.09 | ||||||||||||||||||
Vested and expected to vest at December 31, 2014 | 16,248,179 | 2.26 | 7.03 | ||||||||||||||||||
Summary of Significant Ranges of Outstanding and Exercisable Stock Options and Stock Appreciation Rights | The following table summarizes significant ranges of outstanding and exercisable stock options and stock appreciation rights as of December 31, 2014: | ||||||||||||||||||||
Outstanding stock options and | Exercisable stock options | ||||||||||||||||||||
stock appreciation rights | and stock appreciation rights | ||||||||||||||||||||
Range of exercise prices | Number of | Weighted | Weighted | Number of | Weighted | ||||||||||||||||
options/SARs | average | average | options/SARs | average | |||||||||||||||||
exercise | remaining | exercise | |||||||||||||||||||
price | life (in | price | |||||||||||||||||||
years) | |||||||||||||||||||||
$0.00—$2.00 | 18,270,063 | $ | 1.29 | 4.96 | 11,887,990 | $ | 1.25 | ||||||||||||||
$2.01—$4.00 | 5,163,963 | 2.62 | 5.31 | 3,979,300 | 2.67 | ||||||||||||||||
$4.01—$6.00 | 1,620,000 | 4.9 | 2.84 | 1,120,000 | 4.4 | ||||||||||||||||
$6.01—$10.00 | 500,000 | 10 | 6.46 | — | — | ||||||||||||||||
25,554,026 | $ | 1.96 | 4.93 | 16,987,290 | $ | 1.79 | |||||||||||||||
Restricted Stock Granted | The Company granted the following shares of Class A common stock underlying restricted stock awards to certain employees in connection with their continued or new employment with the Company and to members of its board of directors during the years ended December 31, 2014, 2013 and 2012 (dollars in thousands): | ||||||||||||||||||||
Year ended December 31, | |||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||
Service-based(1) | 250,000 | 211,250 | 3,401,813 | ||||||||||||||||||
Market-based(2)(3)(4)(5) | 150,000 | 300,000 | 2,927,812 | ||||||||||||||||||
Shares issued as Board of Director compensation | 279,349 | 348,698 | 145,124 | ||||||||||||||||||
Total granted | 679,349 | 859,948 | 6,474,749 | ||||||||||||||||||
Fair value of grants | $ | 869 | $ | 1,198 | $ | 9,979 | |||||||||||||||
-1 | The service-based restricted stock awards generally vest at a rate of 25% per year over four years. | ||||||||||||||||||||
-2 | The market-based RSUs granted during the year ended December 31, 2014 fully vest when both of the following have occurred: (i) the average closing price of the Company’s Class A common stock, measured over any period of 60 consecutive calendar days, has reached or exceeded $3.00 per share (the “Price Trigger”), and (ii) the first anniversary of the grant date has occurred. If the Price Trigger is not achieved by the third anniversary of the grant date, then none of the market-based RSUs will vest. | ||||||||||||||||||||
-3 | The market-based RSUs granted during the year ended December 31, 2013 consisted of two awards of 150,000 units each would have vested only after designated time periods had elapsed and designated stock prices had been met. These awards were forfeited during the year ended December 31, 2014. | ||||||||||||||||||||
-4 | The market-based RSUs granted during the year ended December 31, 2012 vest based upon, (i) the Company’s common stock achieving an average closing price of $2.00 for 60 consecutive calendar days, and (ii) upon the Company’s common stock achieving an average closing price of $3.00 for 60 consecutive calendar days. During the year ended December 31, 2013 the market condition of an average closing stock price of $2.00 for 60 consecutive calendar days was met and 2,780,164 restricted stock awards vested. | ||||||||||||||||||||
-5 | On August 24, 2012, the Company’s Board of Directors approved a modification which added alternative vesting criteria for 3,175,000 shares of restricted stock previously granted to employees, including the 2,975,000 granted in 2011. The performance conditions were modified to encourage the attainment of key performance targets and retention of skilled employees. The new terms for the modified restricted stock with performance conditions provide for vesting to occur on the earlier of the Company’s achievement of certain financial targets or modified share price targets. No other terms of the restricted stock awards were modified. | ||||||||||||||||||||
Restricted Stock Award Activity | The Company’s restricted stock award activity for the years ended December 31, 2014, 2013 and 2012 is summarized as follows: | ||||||||||||||||||||
Number of | Weighted | ||||||||||||||||||||
restricted | average | ||||||||||||||||||||
stock awards | grant date | ||||||||||||||||||||
fair value | |||||||||||||||||||||
Unvested—December 31, 2011 | 4,610,909 | $ | 2.18 | ||||||||||||||||||
Granted | 6,474,749 | 1.55 | |||||||||||||||||||
Vested | (559,783 | ) | 1.57 | ||||||||||||||||||
Forfeited | (717,500 | ) | 1.62 | ||||||||||||||||||
Unvested—December 31, 2012 | 9,808,375 | 1.84 | |||||||||||||||||||
Granted | 859,948 | 1.39 | |||||||||||||||||||
Vested | (4,298,239 | ) | 1.53 | ||||||||||||||||||
Forfeited | (457,968 | ) | 1.76 | ||||||||||||||||||
Unvested—December 31, 2013 | 5,912,116 | 1.62 | |||||||||||||||||||
Granted | 679,349 | 1.28 | |||||||||||||||||||
Vested | (1,844,012 | ) | 1.87 | ||||||||||||||||||
Forfeited | (2,187,939 | ) | 1.23 | ||||||||||||||||||
Unvested—December 31, 2014 | 2,559,514 | $ | 1.67 | ||||||||||||||||||
Gain_on_Deconsolidation_of_Sub1
Gain on Deconsolidation of Subsidiaries (Tables) | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Text Block [Abstract] | |||||
Summary of International Subsidiaries Obligations | The following table summarizes the International Subsidiaries obligations, excluding $10.0 million for liabilities related to uncertain tax positions, prior to the transfer to the Liquidating Trust on June 29, 2012 (in thousands): | ||||
June 29, | |||||
2012 | |||||
Accrued expenses | $ | 6,568 | |||
Accrued interest | 30,474 | ||||
Capital lease obligations | 14,881 | ||||
$ | 51,923 | ||||
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||
Income Tax Expense (Benefit) | The Company’s income tax expense (benefit) for the years ended December 31, 2014, 2013 and 2012 consists of the following (in thousands): | ||||||||||||
Year ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
United States—deferred | $ | 33 | $ | — | $ | — | |||||||
Foreign—current | 6,270 | — | (1,034 | ) | |||||||||
$ | 6,303 | $ | — | $ | (1,034 | ) | |||||||
Reconciliation of Federal Statutory Income Tax Rate of 34% to Effective Income Tax Rate | A reconciliation of the federal statutory income tax rate of 34% to the Company’s effective income tax rate is as follows: | ||||||||||||
Year ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Statutory tax rate | 34 | % | 34 | % | 34 | % | |||||||
Change in valuation allowance | (95.75 | ) | (9.33 | ) | (28.71 | ) | |||||||
Release of uncertain tax position | 62.77 | — | — | ||||||||||
Foreign withholding taxes | (7.98 | ) | — | — | |||||||||
Deferred tax adjustments | — | (43.17 | ) | — | |||||||||
§338(h)(10) asset sale treatment upon DBSD sale to DISH | — | 21.22 | — | ||||||||||
Liquidation and deconsolidation of subsidiaries | — | (0.02 | ) | (52.91 | ) | ||||||||
Change in state rate | (0.13 | ) | (0.10 | ) | 40.89 | ||||||||
Expiration of NOLs | (0.13 | ) | (1.11 | ) | 0.78 | ||||||||
Other | (4.94 | ) | (1.49 | ) | 0.89 | ||||||||
Foreign tax benefit | — | — | 2.41 | ||||||||||
Effective tax rate | (12.16 | )% | — | (2.65 | )% | ||||||||
Significant Components of Net Deferred Tax Assets and Liabilities | The significant components of the Company’s net deferred tax assets and liabilities are as follows (in thousands): | ||||||||||||
December 31, | December 31, | ||||||||||||
2014 | 2013 | ||||||||||||
Deferred tax assets: | |||||||||||||
Net operating and capital losses | $ | 938,235 | $ | 894,798 | |||||||||
Basis difference in Liquidating Trust | 29,381 | 31,642 | |||||||||||
Accrued expenses and other | 14,824 | 10,150 | |||||||||||
Total deferred tax assets | 982,440 | 936,590 | |||||||||||
Valuation allowance | (955,133 | ) | (905,502 | ) | |||||||||
Net deferred tax assets | $ | 27,307 | $ | 31,088 | |||||||||
Deferred tax liabilities: | |||||||||||||
Intangibles | $ | (28,828 | ) | $ | (32,576 | ) | |||||||
Total deferred tax liabilities | $ | (28,828 | ) | $ | (32,576 | ) | |||||||
Net deferred tax liabilities | $ | (1,521 | ) | $ | (1,488 | ) | |||||||
Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands): | ||||||||||||
December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Beginning of period | $ | 37,665 | $ | 19,452 | $ | 4,686 | |||||||
Additions based on tax positions related to the current year | — | — | 19,452 | ||||||||||
Additions for tax positions related to prior years | — | 32,533 | 144 | ||||||||||
Reductions for tax positions of prior years | (32,533 | ) | (14,320 | ) | (4,830 | ) | |||||||
End of period | $ | 5,132 | $ | 37,665 | $ | 19,452 | |||||||
Employee_Benefits_Tables
Employee Benefits (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Postemployment Benefits [Abstract] | |||||||||||||
Expense Related to Contributions under Defined Contribution Retirement Included in General and Administrative Expense | Expense related to contributions by the Company under the defined contribution retirement plan included in general and administrative expenses in the Company’s consolidated statements of operations for the years ended December 31, 2014, 2013 and 2012 was as follows (in thousands): | ||||||||||||
Year ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Defined contribution expenses | $ | 264 | $ | 291 | $ | 242 |
Quarterly_Financial_Data_Table
Quarterly Financial Data (Tables) | 12 Months Ended | ||||||||||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||
Unaudited Quarterly Results | Unaudited quarterly results were as follows (in thousands, except per share data): | ||||||||||||||||||||||||||||||||
Three months ended | |||||||||||||||||||||||||||||||||
March 31, | June 30, | September 30, | December 31, | ||||||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||||||
Revenue | $ | 38,135 | $ | 10,992 | $ | 2,935 | $ | 802 | $ | 618 | $ | 781 | $ | 846 | $ | 553 | |||||||||||||||||
Operating income (loss) | 7,134 | (13,053 | ) | (13,563 | ) | (16,739 | ) | (14,096 | ) | (15,037 | ) | (31,191 | ) | (13,032 | ) | ||||||||||||||||||
Net income (loss) | 815 | (13,040 | ) | (13,588 | ) | (16,783 | ) | (14,117 | ) | (15,071 | ) | (31,244 | ) | (13,086 | ) | ||||||||||||||||||
Net income (loss) attributable to Pendrell | 1,730 | (12,366 | ) | (12,595 | ) | (15,822 | ) | (13,262 | ) | (14,228 | ) | (26,875 | ) | (12,646 | ) | ||||||||||||||||||
Basic income (loss) per share attributable to Pendrell | $ | 0.01 | $ | (0.05 | ) | $ | (0.05 | ) | $ | (0.06 | ) | $ | (0.05 | ) | $ | (0.05 | ) | $ | (0.10 | ) | $ | (0.05 | ) | ||||||||||
Diluted income (loss) per share attributable to Pendrell | $ | 0.01 | $ | (0.05 | ) | $ | (0.05 | ) | $ | (0.06 | ) | $ | (0.05 | ) | $ | (0.05 | ) | $ | (0.10 | ) | $ | (0.05 | ) |
Summary_of_Significant_Account3
Summary of Significant Accounting Policies - Additional Information (Detail) (USD $) | 0 Months Ended | 12 Months Ended | 3 Months Ended | ||
Jun. 29, 2012 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | |
Segment | |||||
Significant Accounting Policies [Line Items] | |||||
Number of operating and reporting segments | 1 | ||||
Losses on accounts receivable | $0 | $0 | |||
Allowance for doubtful accounts | 0 | 0 | 0 | ||
Impairment charges | 11,013,000 | 0 | 0 | ||
Gains (losses) on intercompany foreign currency transactions | 0 | 0 | 100,000 | ||
Reclassifications of cumulative translation gains or losses included in net income | -12,700,000 | 0 | 0 | -12,679,000 | |
Accumulated other comprehensive income or (loss) | 0 | 0 | 0 | ||
Provitro Biosciences LLC | |||||
Significant Accounting Policies [Line Items] | |||||
Impairment charges | 11,000,000 | ||||
Jay & Jayendra (Pty) Ltd | |||||
Significant Accounting Policies [Line Items] | |||||
Reimbursement of satellite system expenses from J&J Group | $2,700,000 | $2,700,000 | $2,700,000 | ||
Furniture and Fixtures | Minimum | |||||
Significant Accounting Policies [Line Items] | |||||
Property in Service, estimated useful life | 3 years | ||||
Furniture and Fixtures | Maximum | |||||
Significant Accounting Policies [Line Items] | |||||
Property in Service, estimated useful life | 5 years | ||||
Computer Equipment | Minimum | |||||
Significant Accounting Policies [Line Items] | |||||
Property in Service, estimated useful life | 3 years | ||||
Computer Equipment | Maximum | |||||
Significant Accounting Policies [Line Items] | |||||
Property in Service, estimated useful life | 5 years | ||||
Software | |||||
Significant Accounting Policies [Line Items] | |||||
Property in Service, estimated useful life | 3 years | ||||
Property in service, estimated useful lives, description | Software is depreciated over the shorter of its contractual license period or three years. | ||||
Leasehold Improvements | |||||
Significant Accounting Policies [Line Items] | |||||
Property in service, estimated useful lives, description | Leasehold improvements are amortized over the shorter of their estimated useful lives or the term of the respective lease. |
Summary_of_Cash_and_Cash_Equiv
Summary of Cash and Cash Equivalents (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | ||||
Cash and Cash Equivalents [Line Items] | ||||
Cash and cash equivalents | $168,793 | $184,567 | $213,753 | $230,377 |
Cash | ||||
Cash and Cash Equivalents [Line Items] | ||||
Cash and cash equivalents | 18,403 | 18,043 | ||
Money Market Funds | ||||
Cash and Cash Equivalents [Line Items] | ||||
Cash and cash equivalents | $150,390 | $166,524 |
Computation_of_Basic_and_Dilut
Computation of Basic and Diluted Income (Loss) Per Share (Detail) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||||||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |||
Earnings Per Share [Abstract] | ||||||||||||||
Net income (loss) attributable to Pendrell | ($26,875) | ($13,262) | ($12,595) | $1,730 | ($12,646) | ($14,228) | ($15,822) | ($12,366) | ($51,002) | ($55,062) | $40,084 | |||
Weighted average common shares outstanding | 266,336,617 | 265,684,341 | 261,335,347 | |||||||||||
Less: weighted average unvested restricted stock awards | -1,929,119 | -3,564,938 | -4,380,344 | |||||||||||
Shares used for computation of basic income (loss) per share | 264,407,498 | 262,119,403 | 256,955,003 | |||||||||||
Shares used for computation of basic income (loss) per share | 264,407,498 | 262,119,403 | 256,955,003 | |||||||||||
Add back: weighted average unvested restricted stock awards and units | 4,977,877 | |||||||||||||
Add back: dilutive stock options and stock appreciation rights | 1,891,399 | |||||||||||||
Shares used for computation of diluted income (loss) per share | 264,407,498 | [1] | 262,119,403 | [1] | 263,824,279 | [1] | ||||||||
Basic income (loss) per share attributable to Pendrell | ($0.10) | ($0.05) | ($0.05) | $0.01 | ($0.05) | ($0.05) | ($0.06) | ($0.05) | ($0.19) | ($0.21) | $0.16 | |||
Diluted income (loss) per share attributable to Pendrell | ($0.10) | ($0.05) | ($0.05) | $0.01 | ($0.05) | ($0.05) | ($0.06) | ($0.05) | ($0.19) | ($0.21) | $0.15 | |||
[1] | Stock options, stock appreciation rights, restricted stock awards and units totaling 28,113,540, 34,408,579 and 26,593,976 for the years ended December 31, 2014, 2013 and 2012, respectively, were excluded from the calculation of diluted income (loss) per share as their inclusion was anti-dilutive. |
Computation_of_Basic_and_Dilut1
Computation of Basic and Diluted Income (Loss) Per Share (Parenthetical) (Detail) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Earnings Per Share [Abstract] | |||
Securities excluded from calculation of diluted income (loss) per share | 28,113,540 | 34,408,579 | 26,593,976 |
Business_Combinations_Addition
Business Combinations - Additional Information (Detail) (USD $) | 12 Months Ended | 0 Months Ended | 3 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Feb. 21, 2013 | Dec. 31, 2014 | |
Business Acquisition [Line Items] | |||||
General and administrative expenses | $27,467,000 | $25,939,000 | $29,844,000 | ||
Impairment charges | 11,013,000 | 0 | 0 | ||
Provitro Biosciences LLC | |||||
Business Acquisition [Line Items] | |||||
Percentage of business acquisition interest | 68.75% | ||||
Acquisition-related costs | 400,000 | ||||
Cost of acquisition, cash paid | 16,600,000 | ||||
Definite-lived intangible assets related to developed technology | 12,853,000 | ||||
General and administrative expenses | 2,400,000 | 2,900,000 | |||
Impairment charges | $11,000,000 |
Summary_of_Cash_Paid_for_Asset
Summary of Cash Paid for Assets Acquired and Liabilities Assumed (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Feb. 21, 2013 |
In Thousands, unless otherwise specified | ||||
Business Acquisition [Line Items] | ||||
Goodwill | $21,209 | $21,725 | $21,209 | |
Provitro Biosciences LLC | ||||
Business Acquisition [Line Items] | ||||
Cash | 7,396 | |||
Other current and noncurrent assets, net of liabilities | 430 | |||
Property in service | 2,950 | |||
Net tangible assets acquired | 10,776 | |||
Identifiable intangible assets (developed technology) | 12,853 | |||
Goodwill | 516 | |||
Fair value of assets acquired | 24,145 | |||
Fair value of 31.25% noncontrolling interest | -7,545 | |||
Total purchase price | $16,600 |
Summary_of_Cash_Paid_for_Asset1
Summary of Cash Paid for Assets Acquired and Liabilities Assumed (Parenthetical) (Detail) (Provitro Biosciences LLC) | Feb. 21, 2013 |
Provitro Biosciences LLC | |
Business Acquisition [Line Items] | |
Noncontrolling interest shareholder | 31.25% |
Disposition_of_Satellite_Asset1
Disposition of Satellite Assets - Additional Information (Detail) (USD $) | 0 Months Ended | 12 Months Ended | 3 Months Ended | |
Jun. 29, 2012 | Dec. 31, 2012 | Mar. 31, 2012 | Dec. 31, 2014 | |
Significant Acquisitions and Disposals [Line Items] | ||||
Gain associated with disposition of assets | $5,599,000 | |||
Gain on deconsolidation of subsidiaries | 48,685,000 | 48,685,000 | ||
Operating loss carryforward | 2,500,000,000 | |||
Sale of Satellite Assets and Transfer of International Subsidiaries | ||||
Significant Acquisitions and Disposals [Line Items] | ||||
Elimination of liabilities | 61,900,000 | |||
Operating loss carryforward | 2,400,000,000 | |||
Carryforward of tax, maximum period | 20 years | |||
BRAZIL | ||||
Significant Acquisitions and Disposals [Line Items] | ||||
Gain associated with disposition of assets | $5,600,000 |
Intangible_Assets_and_Goodwill2
Intangible Assets and Goodwill - Additional Information (Detail) (USD $) | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Patent | Patent | |||
Finite-Lived Intangible Assets [Line Items] | ||||
Non-cash impairment charge | $10,500,000 | $10,500,000 | ||
Non-cash impairment charge of goodwill related to acquisition | 516,000 | |||
Impairment charges for finite-lived assets or goodwill | 11,013,000 | 0 | 0 | |
Number of patents purchased | 0 | |||
Number of patents issued | 37 | 37 | ||
Applications filed for additional patents | 62 | |||
Losses on abandonment of certain patents | -2,765,000 | -46,000 | ||
Abandoned assets combined book value | 100,000 | 0 | ||
Amortization of intangible assets | 15,929,000 | 15,864,000 | 13,471,000 | |
Ovidian | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Acquisitions date | 17-Jun-11 | |||
ContentGuard | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Acquisitions date | 31-Oct-11 | |||
Provitro Biosciences LLC | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Impairment charges for finite-lived assets or goodwill | $11,000,000 | |||
Acquisitions date | 21-Feb-13 | |||
Minimum | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Finite lived intangible asset, useful lives | 6 years | |||
Number of issued patents held | 1,200 | 1,200 | ||
Maximum | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Finite lived intangible asset, useful lives | 13 years |
Intangible_Assets_and_Related_
Intangible Assets and Related Amortization (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | |
In Thousands, unless otherwise specified | |||
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Intangible assets, gross | $153,269 | $170,959 | |
Intangible assets, accumulated amortization | -43,567 | -31,272 | |
Intangible assets, net | 109,702 | 139,687 | |
Trade names | |||
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Indefinite lived intangible assets, gross | 4,812 | 4,812 | |
Patents | |||
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Intangible assets, gross | 139,902 | 144,739 | |
Intangible assets, accumulated amortization | -40,321 | -27,925 | |
Developed technology | |||
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Intangible assets, gross | 12,853 | [1] | |
Intangible assets, accumulated amortization | -1,071 | [1] | |
Customer relationships | |||
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Intangible assets, gross | 6,615 | 6,615 | |
Intangible assets, accumulated amortization | -2,680 | -1,872 | |
Trade secrets | |||
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Intangible assets, gross | 1,940 | 1,940 | |
Intangible assets, accumulated amortization | ($566) | ($404) | |
[1] | The Company recorded a non-cash impairment charge of $10.5 million related to Provitro's developed technology reducing the carrying value to zero during the fourth quarter of the year ended December 31, 2014. |
Intangible_Assets_and_Related_1
Intangible Assets and Related Amortization (Parenthetical) (Detail) (USD $) | 3 Months Ended | 12 Months Ended |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2014 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Non-cash impairment charge | $10.50 | $10.50 |
Expected_Period_of_Benefit_of_
Expected Period of Benefit of Intangible Assets with Finite Useful Lives (Detail) | 12 Months Ended |
Dec. 31, 2014 | |
Patents | |
Finite-Lived Intangible Assets [Line Items] | |
Finite lived intangible asset, Weighted Average Lives | 10 years |
Customer relationships | |
Finite-Lived Intangible Assets [Line Items] | |
Finite lived intangible asset, Weighted Average Lives | 9 years |
Trade secrets | |
Finite-Lived Intangible Assets [Line Items] | |
Finite lived intangible asset, Weighted Average Lives | 12 years |
Estimated_Future_Amortization_
Estimated Future Amortization Expense of Purchased Intangible Assets (Detail) (USD $) | Dec. 31, 2014 |
In Thousands, unless otherwise specified | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2015 | $14,332 |
2016 | 14,371 |
2017 | 14,147 |
2018 | 13,966 |
2019 | 13,781 |
Thereafter | 34,293 |
Total | $104,890 |
Changes_in_Carrying_Amount_of_
Changes in Carrying Amount of Goodwill (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Beginning balance | $21,725 | $21,209 |
Impairment of goodwill | -516 | |
Acquisition of Provitro | 516 | |
Ending balance | $21,209 | $21,725 |
Summary_of_Accrued_Expenses_De
Summary of Accrued Expenses (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Payables and Accruals [Abstract] | ||
Accrued payroll and related expenses | $2,570 | $2,242 |
Accrued legal, professional and other expenses | 3,254 | 3,429 |
Accrued expenses | $5,824 | $5,671 |
Other_Liabilities_Additional_I
Other Liabilities - Additional Information (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Other current liabilities | ||
Other Liabilities [Line Items] | ||
Payment obligations | $2 | |
Other non-current liabilities | ||
Other Liabilities [Line Items] | ||
Payment obligations | 4 | |
Restricted stock awards liability | ||
Other Liabilities [Line Items] | ||
Expense related to restricted stock awards included in other current liabilities | 2.2 | |
Expense related to restricted stock awards included in other non-current liabilities | 1.4 | |
Restricted stock awards liability | Other non-current liabilities | ||
Other Liabilities [Line Items] | ||
Expense related to restricted stock awards included in other non-current liabilities | 1.4 | |
Due in 2015 | ||
Other Liabilities [Line Items] | ||
Purchase commitment contractual obligations due in 2015 | $4 |
Commitments_and_Contingencies_1
Commitments and Contingencies - Additional Information (Detail) (USD $) | 0 Months Ended | 12 Months Ended | |||
In Millions, unless otherwise specified | Jan. 31, 2014 | Dec. 18, 2013 | Dec. 31, 2014 | Feb. 28, 2009 | Nov. 30, 2012 |
Patent | Patent | Patent | |||
Gain And Loss Contingencies [Line Items] | |||||
Amount obtained from arbitration judgment | $603.20 | ||||
Covered business method petitions | |||||
Gain And Loss Contingencies [Line Items] | |||||
Number of inter partes review petitions | 3 | ||||
Due in 2015 | |||||
Gain And Loss Contingencies [Line Items] | |||||
Purchase commitment contractual obligations due in 2015 | 4 | ||||
Google Actions | |||||
Gain And Loss Contingencies [Line Items] | |||||
Number of alleged patents infringed | 9 | ||||
Enforcement Action Against Amazon | |||||
Gain And Loss Contingencies [Line Items] | |||||
Number of alleged patents infringed | 9 | ||||
ZTE IPRs | |||||
Gain And Loss Contingencies [Line Items] | |||||
Number of alleged patents infringed | 6 | ||||
Number of patents terminated | 2 | ||||
Number of patents remaining | 4 | ||||
New IPRs filed | 14 | ||||
J&J Arbitration | |||||
Gain And Loss Contingencies [Line Items] | |||||
Amount obtained from arbitration judgment | $4 | ||||
IPR and CBM Petitions by ContentGuard Defendants | |||||
Gain And Loss Contingencies [Line Items] | |||||
Number of alleged patents infringed | 9 | ||||
Number of inter partes review petitions | 29 | ||||
Number of challenging validity | 3 | ||||
ZTE Enforcement Actions | |||||
Gain And Loss Contingencies [Line Items] | |||||
Number of alleged patents infringed | 3 | ||||
Number of patents against nullity action filed | 2 | ||||
Number of revocation of patent | 1 |
Rent_Expense_Detail
Rent Expense (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Commitments and Contingencies Disclosure [Abstract] | |||
Rent expense | $662 | $875 | $637 |
Future_Minimum_Payment_under_L
Future Minimum Payment under Lease Agreements (Detail) (USD $) | Dec. 31, 2014 |
In Thousands, unless otherwise specified | |
Commitments and Contingencies Disclosure [Abstract] | |
2015 | $626 |
2016 | 612 |
2017 | 591 |
2018 | 425 |
2019 | 205 |
Total minimum payments | $2,459 |
Shareholders_Equity_Additional
Shareholders' Equity - Additional Information (Detail) (USD $) | 12 Months Ended | ||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Nov. 14, 2012 | Nov. 26, 2012 | |
Class of Stock [Line Items] | |||||
Estimated forfeiture rate | 5.00% | 5.00% | 5.00% | ||
Unearned stock-based compensation expense, weighted average period recognition | 2 years 2 months 12 days | ||||
Aggregate intrinsic value of stock options exercised | $400,000 | ||||
Stock options vested, total fair value | 7,300,000 | 5,800,000 | 4,100,000 | ||
Repurchasing and/or cancelling value related to the vesting of the restricted stock awards | 775,000 | 2,660,000 | 220,000 | ||
Warrant issued to purchase common stock | 3,200,000 | ||||
Warrant exercise price | $0.01 | ||||
Warrants outstanding | 0 | 0 | |||
Common stock | |||||
Class of Stock [Line Items] | |||||
Number of classes of common stock | 2 | ||||
Repurchasing and/or cancelling value related to the vesting of the restricted stock awards | 2,000 | 6,000 | 1,000 | ||
Accumulated deficit | |||||
Class of Stock [Line Items] | |||||
Repurchasing and/or cancelling value related to the vesting of the restricted stock awards | 140,000 | 932,000 | |||
Additional paid-in capital | |||||
Class of Stock [Line Items] | |||||
Repurchasing and/or cancelling value related to the vesting of the restricted stock awards | $633,000 | $1,722,000 | |||
Equity Incentive Plan Twenty Twelve | |||||
Class of Stock [Line Items] | |||||
Maximum number of shares to be issued | 37,952,546 | ||||
Shares reserved and available for grant | 22,380,966 | ||||
Directors Consultants And Employee Stock Option | |||||
Class of Stock [Line Items] | |||||
Stock options expiration period | 10 years | ||||
Directors Consultants And Employee Stock Option | Termination Of Employment [Member] | Maximum | |||||
Class of Stock [Line Items] | |||||
Stock options expiration period | 3 months | ||||
Directors Consultants And Employee Stock Option | Stock options issued as Board of Director compensation | |||||
Class of Stock [Line Items] | |||||
Stock options exercisable period | 1 year | ||||
Directors Consultants And Employee Stock Option | Service- based | |||||
Class of Stock [Line Items] | |||||
Stock options exercisable period | 4 years | ||||
Restricted Stock And Units Equity And Liability Awards | |||||
Class of Stock [Line Items] | |||||
Stock-awards vested | 1,844,012 | 4,298,239 | 559,783 | ||
Restricted Stock And Units Equity And Liability Awards | Service- based | |||||
Class of Stock [Line Items] | |||||
Stock-awards vested | 801,824 | ||||
Restricted Stock And Units Equity And Liability Awards | Market-based | |||||
Class of Stock [Line Items] | |||||
Stock-awards vested | 2,780,164 | ||||
Restricted Stock And Units Equity And Liability Awards | Market-based | Mr Wolffs Amended and Restated Employment Letter Agreement | |||||
Class of Stock [Line Items] | |||||
Stock-awards vested due to accelerated vesting | 1,042,188 | ||||
Restricted stock awards | |||||
Class of Stock [Line Items] | |||||
Repurchasing and/or cancelling shares related to the vesting of the restricted stock awards | 504,435 | 1,107,901 | |||
Restricted stock awards | Service- based | |||||
Class of Stock [Line Items] | |||||
Stock-awards vested | 1,518,075 | ||||
Restricted stock awards | Market-based | |||||
Class of Stock [Line Items] | |||||
Stock award, average closing price | $2 | ||||
Stock award, period consecutive trading days | 60 days | ||||
Principal Owner [Member] | |||||
Class of Stock [Line Items] | |||||
Eagle River's economic interest percentage | 33.30% | ||||
Eagle River's voting interest percentage | 65.10% | ||||
Warrant issued to purchase common stock | 3,000,000 | ||||
Warrant exercise price | $0.01 | ||||
Class A common stock | |||||
Class of Stock [Line Items] | |||||
Number of vote entitled per share | 1 | ||||
Class B common stock | |||||
Class of Stock [Line Items] | |||||
Number of vote entitled per share | 10 | ||||
Common Stock, Conversion Basis | 1 |
StockBased_Compensation_Expens
Stock-Based Compensation Expense Included in Condensed Consolidated Statements of Operations (Detail) (USD $) | 12 Months Ended | |||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||||
Stock-based compensation | $9,405 | $12,345 | $8,597 | |||
Restricted stock awards | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||||
Stock-based compensation | 2,137 | [1],[2],[3] | 6,622 | [1],[2],[3] | 4,033 | [1],[2],[3] |
Directors Consultants And Employee Stock Option | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||||
Stock-based compensation | $7,268 | [1] | $5,723 | [1] | $4,564 | [1] |
[1] | On November 19, 2014, Benjamin G. Wolff resigned from his positions as President and Chief Executive Officer of the Company. The Company entered into a separation agreement in accordance with the terms of Mr. Wolff's Amended and Restated Employment Letter Agreement (the "Agreement"). The Agreement provided for the vesting of all options, shares of restricted stock ("RSAs") and restricted stock units ("RSUs") in which he would have vested had he remained actively employed by the Company through the second anniversary of his resignation, excluding any unvested performance-based RSAs or performance-based RSUs. The Agreement also provided for an extension of the exercise period for Mr. Wolff's vested stock options until December 15, 2015. The extension of the exercise period is considered a modification and resulted in additional stock-based compensation expense of $0.7 million, as determined using a Black-Scholes model, which was recognized on the modification date as the options were vested pursuant to the Agreement. The accelerated vesting of the options, RSUs and RSAs resulted in $2.1 million of additional stock-based compensation expense in the year ended December 31, 2014. | |||||
[2] | In August 2012, the Company's Board of Directors approved a modification which added alternative vesting criteria required for 3,175,000 shares of restricted stock previously granted to 12 employees. As a result of the modification the Company recorded an additional $1.0 million of stock-based compensation expense for the year ended December 31, 2012, which represents the incremental fair value of the modified restricted stock. | |||||
[3] | Stock-based compensation expense for the year ended December 31, 2014, 2013 and 2012, includes $0.8 million, $0.8 million and $0.6 million of expense, respectively, related to 250,000 Class A common stock restricted stock awards that are required to be treated as a liability. As of December 31, 2014 and 2013, $2.2 million and $1.4 million, respectively, were accrued for such awards. |
StockBased_Compensation_Expens1
Stock-Based Compensation Expense Included in Condensed Consolidated Statements of Operations (Parenthetical) (Detail) (USD $) | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | |||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Aug. 24, 2012 | Dec. 31, 2011 | Nov. 19, 2014 | ||||
Employee | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||||||||
Stock-based compensation | $9,405,000 | $12,345,000 | $8,597,000 | ||||||
Restricted stock awards | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||||||||
Additional stock based compensation | 1,000,000 | ||||||||
Stock-based compensation | 2,137,000 | [1],[2],[3] | 6,622,000 | [1],[2],[3] | 4,033,000 | [1],[2],[3] | |||
Restricted stock awards affected by the modification | 3,175,000 | 2,975,000 | |||||||
Number of employees affected by modification | 12 | ||||||||
Restricted stock awards liability | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||||||||
Stock-based compensation | 800,000 | 800,000 | 600,000 | ||||||
Restricted stock awards accounted for liability awards | 250,000 | ||||||||
Accrued stock-based compensation, current | 2,200,000 | ||||||||
Accrued stock-based compensation, non-current | 1,400,000 | ||||||||
Mr Wolffs Amended and Restated Employment Letter Agreement | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||||||||
Additional stock based compensation expense, accelerated vesting of options | 2,100,000 | ||||||||
Stock-based compensation option exercise period | 15-Dec-15 | ||||||||
Mr Wolffs Amended and Restated Employment Letter Agreement | Stock options | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||||||||
Additional stock based compensation | $700,000 | ||||||||
[1] | In August 2012, the Company's Board of Directors approved a modification which added alternative vesting criteria required for 3,175,000 shares of restricted stock previously granted to 12 employees. As a result of the modification the Company recorded an additional $1.0 million of stock-based compensation expense for the year ended December 31, 2012, which represents the incremental fair value of the modified restricted stock. | ||||||||
[2] | On November 19, 2014, Benjamin G. Wolff resigned from his positions as President and Chief Executive Officer of the Company. The Company entered into a separation agreement in accordance with the terms of Mr. Wolff's Amended and Restated Employment Letter Agreement (the "Agreement"). The Agreement provided for the vesting of all options, shares of restricted stock ("RSAs") and restricted stock units ("RSUs") in which he would have vested had he remained actively employed by the Company through the second anniversary of his resignation, excluding any unvested performance-based RSAs or performance-based RSUs. The Agreement also provided for an extension of the exercise period for Mr. Wolff's vested stock options until December 15, 2015. The extension of the exercise period is considered a modification and resulted in additional stock-based compensation expense of $0.7 million, as determined using a Black-Scholes model, which was recognized on the modification date as the options were vested pursuant to the Agreement. The accelerated vesting of the options, RSUs and RSAs resulted in $2.1 million of additional stock-based compensation expense in the year ended December 31, 2014. | ||||||||
[3] | Stock-based compensation expense for the year ended December 31, 2014, 2013 and 2012, includes $0.8 million, $0.8 million and $0.6 million of expense, respectively, related to 250,000 Class A common stock restricted stock awards that are required to be treated as a liability. As of December 31, 2014 and 2013, $2.2 million and $1.4 million, respectively, were accrued for such awards. |
StockBased_Compensation_Cost_t
Stock-Based Compensation Cost to be Expensed in Future Years Related to Unvested Stock-Based Awards, as Adjusted for Expected Forfeitures (Detail) (USD $) | Dec. 31, 2014 |
In Thousands, unless otherwise specified | |
Equity [Abstract] | |
2015 | $2,894 |
2016 | 1,428 |
2017 | 763 |
2018 | 203 |
2019 and thereafter | 0 |
Stock-based compensation cost to be expensed in future years related to unvested stock-based awards | $5,288 |
Estimated_Weighted_Average_Fai
Estimated Weighted Average Fair Value of Stock Options and Stock Appreciation Rights Granted Using Black-Scholes Model (Detail) (Stock options and stock appreciation rights, USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Stock options and stock appreciation rights | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted average expected volatility | 55.00% | 55.00% | 57.00% |
Weighted average risk-free interest rate | 1.90% | 1.20% | 1.10% |
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Weighted average expected term in years | 6 years 2 months 12 days | 5 years 9 months 18 days | 6 years 2 months 12 days |
Weighted average estimated fair value per option granted | $0.79 | $0.88 | $0.68 |
Stock_Options_Granted_and_Stoc
Stock Options Granted and Stock Appreciation Rights (Detail) (Stock options and stock appreciation rights, USD $) | 12 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock options and appreciation rights, Granted | 4,674,000 | 1,798,000 | 15,750,875 |
Stock options and appreciation rights, Fair value of grants | $3,702 | $1,585 | $10,712 |
Stock options issued as Board of Director compensation | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock options and appreciation rights, Granted | 300,000 | 300,000 | 300,000 |
Service- based | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock options and appreciation rights, Granted | 4,374,000 | 1,248,000 | 15,450,875 |
Performance- based | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock options and appreciation rights, Granted | 250,000 |
Stock_Option_Stock_Appreciatio
Stock Option Stock Appreciation Rights Activity (Detail) (Stock Options and Stock Appreciation Rights, USD $) | 12 Months Ended | |||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Stock Options and Stock Appreciation Rights | ||||
Number of Options | ||||
Outstanding at beginning of period | 28,496,463 | 28,485,375 | 14,195,000 | |
Granted | 4,674,000 | 1,798,000 | 15,750,875 | |
Exercised | -992,499 | -165,312 | -597,875 | |
Forfeited | -6,623,938 | [1] | -1,621,600 | -862,625 |
Outstanding at end of period | 25,554,026 | [2] | 28,496,463 | 28,485,375 |
Exercisable at end of period | 16,987,290 | [2] | ||
Vested and expected to vest at end of period | 25,175,679 | [2] | ||
Weighted average exercise price | ||||
Outstanding at beginning of period | $2.17 | $2.19 | $3.23 | |
Granted | $1.49 | $1.73 | $1.27 | |
Exercised | $1.18 | $1.13 | $1.25 | |
Forfeited | $2.65 | [1] | $2.20 | $3.04 |
Outstanding at end of period | $1.96 | [2] | $2.17 | $2.19 |
Exercisable at end of period | $1.79 | [2] | ||
Vested and expected to vest at end of period | $1.96 | [2] | ||
Weighted average remaining life (in years) | ||||
Outstanding at end of period | 4 years 11 months 5 days | [2] | ||
Exercisable at end of period | 3 years 4 months 21 days | [2] | ||
Vested and expected to vest at end of period | 4 years 10 months 17 days | [2] | ||
Aggregate intrinsic value | ||||
Outstanding at end of period | $2,494 | [2],[3] | ||
Exercisable at end of period | 1,970 | [2],[3] | ||
Vested and expected to vest at end of period | $2,468 | [2],[3] | ||
[1] | In association with the departure of the Company's former CEO, during the year ended December 31, 2014 an additional 375,000 stock options vested due to accelerated vesting of shares and an additional 375,000 shares forfeited. | |||
[2] | In association with the departure of the Company's former CEO, and in accordance with the terms of Mr. Wolff's Agreement, the exercise period for Mr. Wolff's vested stock options was extended until December 15, 2015. Excluding Mr. Wolff's 8,927,500 vested options with a weighted average exercise price of $1.42 and a weighted average remaining life of 0.96 years, the weighted average exercise price and weighted average remaining life for all other outstanding, exercisable, and vested and expected to vest options and stock appreciation rights, is as follows: | |||
[3] | Aggregate intrinsic value represents total pretax intrinsic value (i.e., the difference between the Company's closing stock price on the last trading day of 2014 and the exercise price, times the number of shares) that would have been received by the option holders had all option holders exercised their stock options and stock appreciation rights on the last business day of the fiscal year. |
Stock_Option_Stock_Appreciatio1
Stock Option Stock Appreciation Rights Activity (Parenthetical) (Detail) (Stock Options and Stock Appreciation Rights, USD $) | 12 Months Ended | ||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Shares forfeited | 6,623,938 | [1] | 1,621,600 | 862,625 | |
Vested and expected to vest at end of period | 25,175,679 | [2] | |||
Vested and expected to vest at end of period | $1.96 | [2] | |||
Vested and expected to vest at end of period | 4 years 10 months 17 days | [2] | |||
Outstanding at end of period | 25,554,026 | [2] | 28,496,463 | 28,485,375 | 14,195,000 |
Exercisable at end of period | 16,987,290 | [2] | |||
Outstanding at end of period | $1.96 | [2] | $2.17 | $2.19 | $3.23 |
Exercisable at end of period | $1.79 | [2] | |||
Outstanding at end of period | 4 years 11 months 5 days | [2] | |||
Exercisable at end of period | 3 years 4 months 21 days | [2] | |||
Excluding Benjamin G- Wolff | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vested and expected to vest at end of period | 16,248,179 | ||||
Vested and expected to vest at end of period | $2.26 | ||||
Vested and expected to vest at end of period | 7 years 11 days | ||||
Outstanding at end of period | 16,626,526 | ||||
Exercisable at end of period | 8,059,790 | ||||
Outstanding at end of period | $2.24 | ||||
Exercisable at end of period | $2.19 | ||||
Outstanding at end of period | 7 years 22 days | ||||
Exercisable at end of period | 6 years 1 month 2 days | ||||
Chief Executive Officer | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock options vested | 375,000 | ||||
Shares forfeited | 375,000 | ||||
Vested and expected to vest at end of period | 8,927,500 | ||||
Vested and expected to vest at end of period | $1.42 | ||||
Vested and expected to vest at end of period | 11 months 16 days | ||||
[1] | In association with the departure of the Company's former CEO, during the year ended December 31, 2014 an additional 375,000 stock options vested due to accelerated vesting of shares and an additional 375,000 shares forfeited. | ||||
[2] | In association with the departure of the Company's former CEO, and in accordance with the terms of Mr. Wolff's Agreement, the exercise period for Mr. Wolff's vested stock options was extended until December 15, 2015. Excluding Mr. Wolff's 8,927,500 vested options with a weighted average exercise price of $1.42 and a weighted average remaining life of 0.96 years, the weighted average exercise price and weighted average remaining life for all other outstanding, exercisable, and vested and expected to vest options and stock appreciation rights, is as follows: |
Summary_of_Significant_Ranges_
Summary of Significant Ranges of Outstanding and Exercisable Stock Options and Stock Appreciation Rights (Detail) (Stock Options and Stock Appreciation Rights, USD $) | 12 Months Ended | ||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Outstanding stock options and stock appreciation rights, Number of options/SARs | 25,554,026 | [1] | 28,496,463 | 28,485,375 | 14,195,000 |
Outstanding stock options and stock appreciation rights, Weighted average exercise price | $1.96 | [1] | $2.17 | $2.19 | $3.23 |
Outstanding stock options and stock appreciation rights, Weighted average remaining life (in years) | 4 years 11 months 5 days | [1] | |||
Exercisable stock options and stock appreciation rights, Number of options/SARs | 16,987,290 | [1] | |||
Exercisable stock options and stock appreciation rights, Weighted average exercise price | $1.79 | [1] | |||
$0.00-$2.00 | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Range of exercise prices, lower limit | $0 | ||||
Range of exercise prices, upper limit | $2 | ||||
Outstanding stock options and stock appreciation rights, Number of options/SARs | 18,270,063 | ||||
Outstanding stock options and stock appreciation rights, Weighted average exercise price | $1.29 | ||||
Outstanding stock options and stock appreciation rights, Weighted average remaining life (in years) | 4 years 11 months 16 days | ||||
Exercisable stock options and stock appreciation rights, Number of options/SARs | 11,887,990 | ||||
Exercisable stock options and stock appreciation rights, Weighted average exercise price | $1.25 | ||||
$2.01-$4.00 | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Range of exercise prices, lower limit | $2.01 | ||||
Range of exercise prices, upper limit | $4 | ||||
Outstanding stock options and stock appreciation rights, Number of options/SARs | 5,163,963 | ||||
Outstanding stock options and stock appreciation rights, Weighted average exercise price | $2.62 | ||||
Outstanding stock options and stock appreciation rights, Weighted average remaining life (in years) | 5 years 3 months 22 days | ||||
Exercisable stock options and stock appreciation rights, Number of options/SARs | 3,979,300 | ||||
Exercisable stock options and stock appreciation rights, Weighted average exercise price | $2.67 | ||||
$4.01-$6.00 | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Range of exercise prices, lower limit | $4.01 | ||||
Range of exercise prices, upper limit | $6 | ||||
Outstanding stock options and stock appreciation rights, Number of options/SARs | 1,620,000 | ||||
Outstanding stock options and stock appreciation rights, Weighted average exercise price | $4.90 | ||||
Outstanding stock options and stock appreciation rights, Weighted average remaining life (in years) | 2 years 10 months 2 days | ||||
Exercisable stock options and stock appreciation rights, Number of options/SARs | 1,120,000 | ||||
Exercisable stock options and stock appreciation rights, Weighted average exercise price | $4.40 | ||||
$6.01-$10.00 | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Range of exercise prices, lower limit | $6.01 | ||||
Range of exercise prices, upper limit | $10 | ||||
Outstanding stock options and stock appreciation rights, Number of options/SARs | 500,000 | ||||
Outstanding stock options and stock appreciation rights, Weighted average exercise price | $10 | ||||
Outstanding stock options and stock appreciation rights, Weighted average remaining life (in years) | 6 years 5 months 16 days | ||||
[1] | In association with the departure of the Company's former CEO, and in accordance with the terms of Mr. Wolff's Agreement, the exercise period for Mr. Wolff's vested stock options was extended until December 15, 2015. Excluding Mr. Wolff's 8,927,500 vested options with a weighted average exercise price of $1.42 and a weighted average remaining life of 0.96 years, the weighted average exercise price and weighted average remaining life for all other outstanding, exercisable, and vested and expected to vest options and stock appreciation rights, is as follows: |
Restricted_Stock_Granted_Detai
Restricted Stock Granted (Detail) (Class A common stock, Restricted stock awards, USD $) | 12 Months Ended | |||||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted stock awards granted | 679,349 | 859,948 | 6,474,749 | |||
Restricted stock awards granted, Fair value of grants | $869 | $1,198 | $9,979 | |||
Market-based | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted stock awards granted | 150,000 | [1],[2],[3],[4] | 300,000 | [1],[2],[3],[4] | 2,927,812 | [1],[2],[3],[4] |
Service- based | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted stock awards granted | 250,000 | [5] | 211,250 | [5] | 3,401,813 | [5] |
Stock options issued as Board of Director compensation | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted stock awards granted | 279,349 | 348,698 | 145,124 | |||
[1] | The market-based RSUs granted during the year ended December 31, 2014 fully vest when both of the following have occurred: (i) the average closing price of the Company's Class A common stock, measured over any period of 60 consecutive calendar days, has reached or exceeded $3.00 per share (the "Price Trigger"), and (ii) the first anniversary of the grant date has occurred. If the Price Trigger is not achieved by the third anniversary of the grant date, then none of the market-based RSUs will vest. | |||||
[2] | The market-based RSUs granted during the year ended December 31, 2013 consisted of two awards of 150,000 units each would have vested only after designated time periods had elapsed and designated stock prices (each a "Price Threshold") had been met. These awards were forfeited during the year ended December 31, 2014. | |||||
[3] | The market-based RSUs granted during the year ended December 31, 2012 vest based upon, (i) the Company's common stock achieving an average closing price of $2.00 for 60 consecutive calendar days, and (ii) upon the Company's common stock achieving an average closing price of $3.00 for 60 consecutive calendar days. During the year ended December 31, 2013 the market condition of an average closing stock price of $2.00 for 60 consecutive calendar days was met and 2,780,164 restricted stock awards vested. | |||||
[4] | On August 24, 2012, the Company's Board of Directors approved a modification which added alternative vesting criteria for 3,175,000 shares of restricted stock previously granted to employees, including the 2,975,000 granted in 2011. The performance conditions were modified to encourage the attainment of key performance targets and retention of skilled employees. The new terms for the modified restricted stock with performance conditions provide for vesting to occur on the earlier of the Company's achievement of certain financial targets or modified share price targets. No other terms of the restricted stock awards were modified. | |||||
[5] | The service-based restricted stock awards generally vest at a rate of 25% per year over four years. |
Restricted_Stock_Granted_Paren
Restricted Stock Granted (Parenthetical) (Detail) (Restricted stock awards, USD $) | 0 Months Ended | 12 Months Ended | |||
Aug. 24, 2012 | Dec. 31, 2011 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Restricted stock awards affected by the modification | 3,175,000 | 2,975,000 | |||
Service-based | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Restricted stock award vesting percentage | 25.00% | ||||
Service-based restricted stock awards vesting period | 4 years | ||||
Market-based | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Average closing price | $2 | ||||
Stock award, period consecutive trading days | 60 days | ||||
Condition one | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Average closing price | 3 | $2 | |||
Stock award, period consecutive trading days | 60 days | 60 days | |||
Condition one | Market-based | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Average closing price | $2 | ||||
Stock award, period consecutive trading days | 60 days | ||||
Restricted stock awards vested | 2,780,164 | ||||
2013 market award condition three awards | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Restricted stock award designated stock prices | 150,000 | ||||
2013 market award condition four awards | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Restricted stock award designated stock prices | 150,000 | ||||
Condition two | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Average closing price | $3 | ||||
Stock award, period consecutive trading days | 60 days |
Restricted_Stock_Activity_Deta
Restricted Stock Activity (Detail) (Restricted Stock And Units Equity And Liability Awards, USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Restricted Stock And Units Equity And Liability Awards | |||
Number of restricted stock awards | |||
Unvested Beginning Balance | 5,912,116 | 9,808,375 | 4,610,909 |
Granted | 679,349 | 859,948 | 6,474,749 |
Vested | -1,844,012 | -4,298,239 | -559,783 |
Forfeited | -2,187,939 | -457,968 | -717,500 |
Unvested Ending Balance | 2,559,514 | 5,912,116 | 9,808,375 |
Weighted average fair Value | |||
Unvested Beginning Balance | $1.62 | $1.84 | $2.18 |
Granted | $1.28 | $1.39 | $1.55 |
Vested | $1.87 | $1.53 | $1.57 |
Forfeited | $1.23 | $1.76 | $1.62 |
Unvested Ending Balance | $1.67 | $1.62 | $1.84 |
Gain_on_Deconsolidation_of_Sub2
Gain on Deconsolidation of Subsidiaries - Additional Information (Detail) (USD $) | 0 Months Ended | 12 Months Ended | ||
Jun. 29, 2012 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Effects of Deconsolidation of Subsidiaries [Line Items] | ||||
Gain on deconsolidation of subsidiaries | $48,685,000 | $48,685,000 | ||
Reclassification of cumulative translation adjustment loss included in net income | -12,700,000 | 0 | 0 | -12,679,000 |
General and administrative expenses | 27,467,000 | 25,939,000 | 29,844,000 | |
International Subsidiaries | ||||
Effects of Deconsolidation of Subsidiaries [Line Items] | ||||
Elimination of liabilities | 61,900,000 | |||
Liabilities for uncertain tax positions | 10,000,000 | |||
General and administrative expenses | 300,000 | |||
Interest expense | $2,500,000 |
Summary_of_International_Subsi
Summary of International Subsidiaries Obligations (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Jun. 29, 2012 |
In Thousands, unless otherwise specified | |||
Schedule of Accrued Liabilities [Line Items] | |||
Accrued expenses | $5,824 | $5,671 | |
Total current liabilities | 12,996 | 8,506 | |
International Subsidiaries | |||
Schedule of Accrued Liabilities [Line Items] | |||
Accrued expenses | 6,568 | ||
Accrued interest | 30,474 | ||
Capital lease obligations | 14,881 | ||
Total current liabilities | $51,923 |
Recovered_Sheet1
Gain on Settlement of Boeing Litigation - Additional Information (Detail) (USD $) | 0 Months Ended | 12 Months Ended | |
Apr. 13, 2012 | Dec. 31, 2012 | Feb. 28, 2009 | |
Litigation Settlement [Abstract] | |||
Judgment in Company's favor | $603,200,000 | ||
Court of Appeal process period | 3 years | ||
Gain on litigation settlement | $10,000,000 |
Income_Tax_Expense_Benefit_Det
Income Tax Expense (Benefit) (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2012 |
Income Tax Disclosure [Abstract] | ||
United States-deferred | $33 | |
Foreign-current | 6,270 | -1,034 |
Income tax benefit | $6,303 | ($1,034) |
Income_Taxes_Additional_Inform
Income Taxes - Additional Information (Detail) (USD $) | 12 Months Ended | |||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Shareholder | ||||
Operating Loss Carryforwards [Line Items] | ||||
Income tax provision | $6,303,000 | ($1,034,000) | ||
Statutory tax rate | 34.00% | 34.00% | 34.00% | |
Net operating loss carry forwards | 2,500,000,000 | |||
Net operating loss carry forwards, year expiration begins | 2025 | |||
Net operating loss carry forwards, year expiration | 2032 | |||
Income tax description | Broadly, the Company will have a Tax Ownership Change if, over a three year testing period, the portion of all stock of the Company, by value, owned by one or more 5% shareholder increases by more than 50 percentage points. For purposes of this test, shareholders that own less than 5% of the stock of the Company are aggregated into one or more separate "public groups", each of which is treated as a 5% shareholder. | |||
Tax ownership change testing period, year | 3 years | |||
Tax ownership change, shareholder ownership percentage | 5.00% | |||
Unrecognized tax benefit | 5,132,000 | 37,665,000 | 19,452,000 | 4,686,000 |
Availability of additional net operating losses for future use | 95,700,000 | |||
Unrecognized tax benefits due to reduction in net operating loss | 32,500,000 | |||
Estimated reduction of unrecognized tax benefits | 5,100,000 | |||
Personal holding company determination, number of shareholders limit | 5 | |||
Ownership percentage of individual shareholders in a personal holding company | 50.00% | |||
Personal holding company tax rate on net personal holding company income | 20.00% | |||
Tax Benefits Preservation Plan | Holders of 4.9% or more of the Companybs securities outstanding as of the close of business on January 29, 2010 will not trigger the Tax Benefits Preservation Plan so long as they do not (i) acquire additional securities constituting one-half of one percent (0.5%) or more of the Companybs securities outstanding as of the date of the Tax Benefits Preservation Plan (as adjusted to reflect any stock splits, subdivisions and the like), or (ii) fall under 4.9% ownership of the Companybs securities and then re-acquire securities that increase their ownership to 4.9% or more of the Companybs securities. The Board of Directors may exempt certain persons whose acquisition of securities is determined by the Board of Directors not to jeopardize the Companybs tax benefits or to otherwise be in the best interest of the Company and its shareholders. The Board of Directors may also exempt certain transactions. | |||
Additional percentage of beneficial interest acquired to trigger tax benefit preservation plan | 0.50% | |||
California Franchise Tax Board [Member] | ||||
Operating Loss Carryforwards [Line Items] | ||||
Net operating loss carry forwards | $1,400,000,000 | |||
Net operating loss carry forwards, year expiration | 2015 | |||
Minimum | ||||
Operating Loss Carryforwards [Line Items] | ||||
Tax ownership change, number of shareholders | 1 | |||
Tax ownership change, shareholder ownership percentage increase | 50.00% | |||
Percentage of adjusted ordinary gross income pertaining to individual shareholders | 60.00% | |||
Tax Benefits Preservation Plan trigger, ownership percentage | 4.90% |
Reconciliation_of_Federal_Stat
Reconciliation of Federal Statutory Income Tax Rate of 34% to Effective Income Tax Rate (Detail) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Income Tax Disclosure [Abstract] | |||
Statutory tax rate | 34.00% | 34.00% | 34.00% |
Change in valuation allowance | -95.75% | -9.33% | -28.71% |
Release of uncertain tax position | 62.77% | ||
Foreign withholding taxes | -7.98% | ||
Deferred tax adjustments | -43.17% | ||
B'338(h)(10) asset sale treatment upon DBSD sale to DISH | 21.22% | ||
Liquidation and deconsolidation of subsidiaries | -0.02% | -52.91% | |
Change in state rate | -0.13% | -0.10% | 40.89% |
Expiration of NOLs | -0.13% | -1.11% | 0.78% |
Other | -4.94% | -1.49% | 0.89% |
Foreign tax benefit | 2.41% | ||
Effective tax rate | -12.16% | -2.65% |
Significant_Components_of_Net_
Significant Components of Net Deferred Tax Assets and Liabilities (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Income Tax Disclosure [Abstract] | ||
Net operating and capital losses | $938,235 | $894,798 |
Basis difference in Liquidating Trust | 29,381 | 31,642 |
Accrued expenses and other | 14,824 | 10,150 |
Total deferred tax assets | 982,440 | 936,590 |
Valuation allowance | -955,133 | -905,502 |
Net deferred tax assets | 27,307 | 31,088 |
Intangibles | -28,828 | -32,576 |
Total deferred tax liabilities | -28,828 | -32,576 |
Net deferred tax liabilities | ($1,521) | ($1,488) |
Reconciliation_of_Beginning_an
Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Income Tax Disclosure [Abstract] | |||
Total liability, Beginning of period | $37,665 | $19,452 | $4,686 |
Additions based on tax positions related to the current year | 19,452 | ||
Additions for tax positions related to prior years | 32,533 | 144 | |
Reductions for tax positions of prior years | -32,533 | -14,320 | -4,830 |
Total liability, End of period | $5,132 | $37,665 | $19,452 |
Expense_Related_to_Contributio
Expense Related to Contributions under Defined Contribution Retirement Included in General and Administrative Expense (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Postemployment Benefits [Abstract] | |||
Defined contribution expenses | $264 | $291 | $242 |
Related_Parties_Additional_Inf
Related Parties - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2012 | Nov. 26, 2012 |
Related Party Transaction [Line Items] | |||
Warrant exercised | 3.2 | ||
Warrant exercise price | $0.01 | ||
Exercise date of warrants | 26-Nov-12 | ||
Subleases payment for office space use | $0.20 | ||
Principal Owner [Member] | |||
Related Party Transaction [Line Items] | |||
Eagle River's economic interest percentage | 33.30% | ||
Eagle River's voting interest percentage | 65.10% | ||
Warrant exercised | 3 | ||
Warrant exercise price | $0.01 |
Quarterly_Financial_Data_Addit
Quarterly Financial Data - Additional Information (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||
In Millions, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2013 |
Quarterly Financial Information Disclosure [Abstract] | |||||
Bonus accrual | $1.20 | $2.60 | $1.20 | ||
Bonus expenses | 0.9 | 0.9 | 0.9 | ||
Reversal of bonus expenses | -1.4 | ||||
Increase decrease in bonus expenses | $2.30 |
Unaudited_Quarterly_Results_De
Unaudited Quarterly Results (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Revenue | $846 | $618 | $2,935 | $38,135 | $553 | $781 | $802 | $10,992 | $42,534 | $13,128 | $33,775 |
Operating income (loss) | -31,191 | -14,096 | -13,563 | 7,134 | -13,032 | -15,037 | -16,739 | -13,053 | -51,716 | -57,861 | -24,644 |
Net income (loss) | -31,244 | -14,117 | -13,588 | 815 | -13,086 | -15,071 | -16,783 | -13,040 | -58,134 | -57,980 | 40,017 |
Net income (loss) attributable to Pendrell | ($26,875) | ($13,262) | ($12,595) | $1,730 | ($12,646) | ($14,228) | ($15,822) | ($12,366) | ($51,002) | ($55,062) | $40,084 |
Basic income (loss) per share attributable to Pendrell | ($0.10) | ($0.05) | ($0.05) | $0.01 | ($0.05) | ($0.05) | ($0.06) | ($0.05) | ($0.19) | ($0.21) | $0.16 |
Diluted income (loss) per share attributable to Pendrell | ($0.10) | ($0.05) | ($0.05) | $0.01 | ($0.05) | ($0.05) | ($0.06) | ($0.05) | ($0.19) | ($0.21) | $0.15 |