Lendway (LDWY) 10-K 18 Mar 16 2015 FY Annual report Financial data

Document and Entity Information

Document and Entity Information - USD ($)	12 Months Ended
	Dec. 31, 2015	Mar. 14, 2016	Jun. 30, 2015
Document and Entity Information
Entity Registrant Name	INSIGNIA SYSTEMS INC/MN
Entity Central Index Key	875,355
Document Type	10-K
Document Period End Date	Dec. 31, 2015
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Smaller Reporting Company
Entity Public Float			$ 26,395,000
Entity Common Stock, Shares Outstanding		11,611,303
Document Fiscal Year Focus	2,015
Document Fiscal Period Focus	FY

BALANCE SHEETS

BALANCE SHEETS - USD ($)	Dec. 31, 2015	Dec. 31, 2014
Current Assets:
Cash and cash equivalents	$ 8,523,000	$ 7,237,000
Accounts receivable, net	8,392,000	7,492,000
Available-for-sale investments	9,490,000	9,698,000
Inventories	391,000	523,000
Income tax receivable	1,000	287,000
Prepaid expenses and other	492,000	715,000
Total Current Assets	27,289,000	25,952,000
Other Assets:
Property and equipment, net	1,584,000	1,467,000
Other, net	2,841,000	3,056,000
Total Assets	31,714,000	30,475,000
Current Liabilities:
Accounts payable	3,355,000	3,088,000
Accrued liabilities:
Compensation	1,494,000	1,199,000
Other	715,000	719,000
Income tax payable	264,000	82,000
Deferred revenue	164,000	172,000
Total Current Liabilities	5,992,000	5,260,000
Long-Term Liabilities:
Deferred tax liabilities	199,000	170,000
Accrued income taxes	528,000	486,000
Deferred rent	275,000
Total Long-Term Liabilities	$ 1,002,000	$ 656,000
Commitments and Contingencies
Shareholders' Equity:
Common stock, par value $.01: Authorized shares - 40,000,000 Issued shares - 11,721,000 in 2015 and 12,216,000 in 2014 Outstanding shares - 11,633,000 in 2015 and 12,191,000 in 2014.	$ 116,000	$ 122,000
Additional paid-in capital	17,810,000	19,177,000
Retained earnings	6,805,000	5,271,000
Accumulated other comprehensive loss	(11,000)	(11,000)
Total Shareholders' Equity	24,720,000	24,559,000
Total Liabilities and Shareholders' Equity	$ 31,714,000	$ 30,475,000

BALANCE SHEETS (Parenthetical)

BALANCE SHEETS (Parenthetical) - $ / shares	Dec. 31, 2015	Dec. 31, 2014
Balance Sheets
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	40,000,000	40,000,000
Common stock, shares issued	11,721,000	12,216,000
Common stock, shares outstanding	11,633,000	12,191,000

STATEMENTS OF COMPREHENSIVE INC

STATEMENTS OF COMPREHENSIVE INCOME - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Statements of Comprehensive Income
Services revenues	$ 26,391,000	$ 24,473,000
Products revenues	1,820,000	1,832,000
Total Net Sales	28,211,000	26,305,000
Cost of services	14,237,000	13,261,000
Cost of goods sold	1,303,000	1,262,000
Total Cost of Sales	15,540,000	14,523,000
Gross Profit	12,671,000	11,782,000
Operating Expenses:
Selling	4,498,000	5,822,000
Marketing	1,623,000	1,527,000
General and administrative	4,086,000	3,966,000
Total Operating Expenses	10,207,000	11,315,000
Operating Income	2,464,000	467,000
Other income	76,000	42,000
Income Before Taxes	2,540,000	509,000
Income tax expense	1,006,000	298,000
Net Income	1,534,000	211,000
Other comprehensive income, net of tax:
Unrealized loss on available for sale securities		(11,000)
Comprehensive Income	$ 1,534,000	$ 200,000
Net income (loss) per share:
Basic	$ 0.13	$ 0.02
Diluted	$ 0.13	$ 0.02
Shares used in calculation of net income per share:
Basic	12,044,000	12,635,000
Diluted	12,216,000	12,873,000

STATEMENTS OF SHAREHOLDERS' EQU

STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($)	Common Stock	Additional Paid-In Capital	Retained Earnings	Accumulated Other Comprehensive Loss	Total
Balances at Dec. 31, 2013	$ 128,000	$ 20,982,000	$ 5,060,000		$ 26,170,000
Balances, shares at Dec. 31, 2013	12,782,000
Issuance of common stock, net	$ 2,000	214,000			216,000
Issuance of common stock, shares	166,000
Repurchase of common stock, net	$ (8,000)	(2,442,000)			(2,450,000)
Repurchase of common stock, shares	(787,000)
Value of stock-based compensation		403,000			403,000
Value of stock-based compensation, shares	30,000
Excess tax benefit (deficiency) from stock awards		20,000			20,000
Net income			211,000		211,000
Other comprehensive loss, net of tax				$ (11,000)	(11,000)
Balances at Dec. 31, 2014	$ 122,000	19,177,000	5,271,000	(11,000)	24,559,000
Balances, shares at Dec. 31, 2014	12,191,000
Issuance of common stock, net	$ 1,000	47,000			48,000
Issuance of common stock, shares	69,000
Repurchase of common stock, net	$ (7,000)	(1,755,000)			(1,762,000)
Repurchase of common stock, shares	(664,000)
Value of stock-based compensation		353,000			353,000
Value of stock-based compensation, shares	37,000
Excess tax benefit (deficiency) from stock awards		(12,000)			(12,000)
Net income			1,534,000		1,534,000
Balances at Dec. 31, 2015	$ 116,000	$ 17,810,000	$ 6,805,000	$ (11,000)	$ 24,720,000
Balances, shares at Dec. 31, 2015	11,633,000

STATEMENTS OF CASH FLOWS

STATEMENTS OF CASH FLOWS - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Operating Activities:
Net income	$ 1,534,000	$ 211,000
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization	1,156,000	1,177,000
Changes in allowance for doubtful accounts	(10,000)	72,000
Deferred income tax expense	29,000	57,000
Stock-based compensation	353,000	403,000
Gain on sale of property and equipment	(30,000)	(3,000)
Changes in operating assets and liabilities:
Accounts receivable	(890,000)	(3,277,000)
Inventories	132,000	(216,000)
Income tax receivable	286,000	(276,000)
Prepaid expenses and other	224,000	(424,000)
Accounts payable	(73,000)	452,000
Accrued liabilities	291,000	177,000
Income tax payable	170,000	80,000
Accrued income taxes	42,000	28,000
Excess tax deficiency (benefit) from stock-based awards	12,000	(20,000)
Deferred revenue	(8,000)	(89,000)
Net cash provided by (used in) operating activities	3,218,000	(1,648,000)
Investing Activities:
Purchases of property and equipment	(444,000)	(427,000)
Acquisition of selling rights and other		(542,000)
Purchases of investments	(5,441,000)	(12,474,000)
Proceeds received from sale or maturity of investments	5,649,000	2,765,000
Proceeds received from sale of property and equipment	30,000	14,000
Net cash used in investing activities	(206,000)	(10,664,000)
Financing Activities:
Proceeds from issuance of common stock, net	48,000	216,000
Excess tax (deficiency) benefit from stock-based awards	(12,000)	20,000
Repurchase of common stock, net	(1,762,000)	(2,450,000)
Net cash used in financing activities	(1,726,000)	(2,214,000)
Increase (decrease) in cash and cash equivalents	1,286,000	(14,526,000)
Cash and cash equivalents at beginning of year	7,237,000	21,763,000
Cash and cash equivalents at end of year	8,523,000	7,237,000
Supplemental disclosures for cash flow information:
Cash paid during the year for income taxes	653,000	$ 482,000
Non-cash financing activities:
Purchases of property and equipment included in accounts payable	340,000
Tenant allowance in other assets and deferred rent	$ 275,000

Summary of Significant Accounti

Summary of Significant Accounting Policies	12 Months Ended
	Dec. 31, 2015
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies	1. Summary of Significant Accounting Policies . Description of Business . Insignia Systems, Inc. (the “Company”) markets in-store advertising products, programs and services to retailers and consumer packaged goods manufacturers. The Company operates in a single reportable segment. The Company’s products include the Insignia Point-of-Purchase Services (POPS ® ) in-store marketing program, thermal sign card supplies for the Company’s Impulse Retail System, and laser printable cardstock and label supplies. Additionally, in October 2014, the Company announced the introduction of a new product, The Like Machine TM , which is an in-store consumer approval device. The Company licenses this product from TLM Holdings, LLC (“TLMH”), a company in which Insignia’s Chief Sales and Marketing Officer, Tim Halfmann, is the majority owner and serves as a principal. In March 20l6, the Company and TLMH signed a new distribution agreement for the sale of The Like Machine to Insignia’s customers. This new agreement replaces the Company’s prior license agreement with TLMH. Mr. Halfmann has resigned from Insignia, effective April 30, 2016 in order to focus his efforts more fully on The Like Machine product and its evolution going forward. Revenue Recognition . Revenues are recognized by the Company when persuasive evidence of an arrangement exists, shipment has occurred, the price is fixed, and collectability is reasonably assured. The Company recognizes revenue from Insignia POPSigns and The Like Machine ratably over the period of service. The Company recognizes revenue related to equipment and sign card sales at the time the products are shipped to customers. Revenue associated with maintenance agreements is recognized ratably over the life of the contract. Revenue that has been billed and not yet earned is reflected as deferred revenue on the balance sheet . We account for taxes collected for customers on a net basis. In May 2014, the Financial Accounting Standards Board (“FASB”) issued guidance creating Accounting Standards Codification (“ASC”) Section 606, “Revenue from Contracts with Customers”. The new section will replace Section 605, “Revenue Recognition” and creates modifications to various other revenue accounting standards for specialized transactions and industries. The section is intended to conform revenue accounting principles with a concurrently issued International Financial Reporting Standards with previously differing treatment between United States practice and those of much of the rest of the world, as well as, to enhance disclosures related to disaggregated revenue information. The updated guidance is effective for annual reporting periods beginning after December 15, 2017, and interim periods within that reporting period. Early application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. The Company is studying the implications of this guidance in order to evaluate the expected impact on its financial statements. Cash and Cash Equivalents . The Company considers all highly liquid investments with an original maturity date of three months or less to be cash equivalents. Cash equivalents are stated at cost, which approximates fair value. At December 31, 2015, $7,815,000 was invested in an insured cash sweep account. At December 31, 2014, $6,329,000 was invested in an overnight repurchase account and $500,000 was invested in certificates of deposit. The balances in cash accounts, at times, may exceed federally insured limits. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash and cash equivalents. Amounts held in checking accounts during the years ended December 31, 2015 and 2014, were fully insured under the Federal Deposit Insurance Corporation (“FDIC”). Amounts held in insured cash sweep accounts during the year ended December 31, 2015 were fully insured under the FDIC. Amounts held in repurchase accounts during the years ended December 31, 2015 and 2014, were secured by Federal Home Loan securities and were fully insured by the FDIC. Bank certificates of deposit at December 31, 2014, were held at various institutions with amounts at each institution at or below the $250,000 insured limit of the FDIC. Fair Value of Financial Measurements . Fair value of financial instruments and selected non-financial assets and liabilities is measured in accordance with ASC 820-10, “Fair Value Measurements.” Fair value is defined as the exit price, or the amount that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants as of the measurement date. ASC 820-10 also establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would use in valuing the asset or liability, developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect management’s assumptions about the factors market participants would use in valuing the asset or liability developed based upon the best information available in the circumstances. The hierarchy is divided into three levels. Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 inputs include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active and inputs (other than quoted prices) that are observable for the asset or liability, either directly or indirectly. Level 3 inputs are unobservable inputs for the asset or liability. Categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Certain of the Company’s financial assets and liabilities are recorded at their carrying amounts that approximate fair value, based on their short-term nature. These financial assets and liabilities include cash and cash equivalents, accounts receivable and accounts payable. The Company measures its available-for-sale investments at fair value on a recurring basis and the fair value hierarchy used to determine these fair values is as follows as of December 31, 2015 and 2014: Fair Value Measurements Using Total Carrying Value at December 31 Quoted Prices in Active Markests (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets as of December 31, 2015: Available-for-sale securities — — Assets as of December 31, 2014: Available-for-sale securities — — Available-for-sale securities in the preceding table are carried at fair value with unrealized gains and losses reported as a component of shareholders’ equity as accumulated other comprehensive loss, net of tax. Fair value for available-for-sale securities is based on quoted prices for similar assets in active markets or quoted prices for identical or similar assets in markets in which there were fewer transactions. Amortization of premiums or discounts arising at acquisition, and gains or losses on the disposition of available-for-sale securities are reported as other income. Realized gains and losses, if any, are calculated on the specific identification method and are included in other income in the statements of comprehensive income. Accounts Receivable . The majority of the Company’s accounts receivable is due from companies in the consumer packaged goods industry. Credit is extended based on evaluation of a customer’s financial condition and, generally, collateral is not required. Accounts receivable are due within 30-90 days and are stated at amounts due from customers, net of an allowance for doubtful accounts. Accounts receivable outstanding longer than the contractual payment terms are considered past due. The Company determines its allowance by considering a number of factors, including the length of time trade accounts receivable are past due, the Company’s previous loss history, the customer’s current ability to pay its obligation to the Company, and the condition of the general economy and the industry as a whole. The Company writes-off accounts receivable when they become uncollectible, and payments subsequently received on such receivables are credited to the allowance for doubtful accounts. Changes in the Company’s allowance for doubtful accounts are as follows: December 31 2015 2014 Beginning balance $ $ Bad debt provision ) Accounts written-off ) — Ending balance $ $ Inventories . Inventories are primarily comprised of parts and supplies for the Impulse machine, sign cards, and roll stock. Inventory is valued at the lower of cost or market using the first-in, first-out (FIFO) method, and consists of the following: December 31 2015 2014 Raw materials $ $ Work-in-process Finished goods $ $ Property and Equipment . Property and equipment is recorded at cost. Significant additions or improvements extending asset lives are capitalized, while repairs and maintenance are charged to expense when incurred. Depreciation is provided in amounts sufficient to relate the cost of assets to operations over their estimated useful lives. The straight-line method of depreciation is used for financial reporting purposes and accelerated methods are used for tax purposes. Estimated useful lives of the assets are as follows: Production tooling, machinery and equipment 1 - 6 years Office furniture and fixtures 3 years Computer equipment and software 3 years Web development 3 years Leasehold improvements are amortized over the shorter of the remaining term of the lease or estimated life of the asset. Impairment of Long-Lived Assets . The Company records impairment losses on long-lived assets used in operations when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets are less than the assets’ carrying amount. Impaired assets are then recorded at their estimated fair value. There were no impairment losses during the years ended December 31, 2015 and 2014. Income Taxes . Income taxes are accounted for under the liability method. Deferred income taxes are provided for temporary differences between the financial reporting and tax basis of assets and liabilities. Deferred taxes are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or the entire deferred tax asset will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of the enactment. It is the Company’s policy to provide for uncertain tax positions and the related interest and penalties based upon management’s assessment of whether a tax benefit is more likely than not to be sustained upon examination by tax authorities. The Company recognizes interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense. Stock-Based Compensation . The Company measures and recognizes compensation expense for all stock-based payments at fair value. We use the Black-Scholes option pricing model to determine the weighted average fair value of options and employee stock purchase plan rights. The determination of fair value of share-based payment awards on the date of grant using an option-pricing model is affected by our stock price as well as by assumptions regarding a number of complex and subjective variables. These variables 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. Restricted stock units are valued at the closing market price of the Company’s stock date of the grant. The expected lives of the options and employee stock purchase plan rights are based on evaluations of historical and expected future employee exercise behavior. The risk-free interest rate is based on the U.S. Treasury rates at the date of grant with maturity dates approximately equal to the expected term at grant date. Volatility is based on historical and expected future volatility of the Company’s stock. The Company has not historically issued any dividends beyond a one-time dividend in 2011 and does not expect to in the future. Forfeitures are estimated at the time of the grant and revised, if necessary, in subsequent periods if actual forfeitures differ from estimates. Advertising Costs . Advertising costs are charged to operations as incurred. Advertising expenses were approximately $42,000 and $183,000 during the years ended December 31, 2015 and 2014, respectively. Net Income Per Share . Basic net income per share is computed by dividing net income by the weighted average shares outstanding and excludes any dilutive effects of stock options and restricted stock units. Diluted net income per share gives effect to all diluted potential common shares outstanding during the year. Weighted aver age common shares outstanding for the years ended December 31, 2015 and 2014 were as follows: Year ended December 31 2015 2014 Denominator for basic net income per share - weighted average shares Effect of dilutive securities: Stock options and restricted stock units Denominator for diluted net income per share - weighted average shares Options to purchase approximately 613,000 shares of common stock with a weighted average exercise price of $3.79 were outstanding at December 31, 2015 and were not included in the computation of common stock equivalents because their exercise prices were higher than the average fair market value of the common shares during the year. Options to purchase approximately 592,000 shares of common stock with a weighted average exercise price of $4.24 were outstanding at December 31, 2014 and were not included in the computation of common stock equivalents because their exercise prices were higher than the average fair market value of the common shares during the year. Use of Estimates . The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from these estimates.

Investments

Investments	12 Months Ended
	Dec. 31, 2015
Investments.
Investments	2. Investments . The Company carries certain investments intended to increase the yield on available cash balances. The Company has classified all investments as current assets, as they are available to fund current operations. These investments are in debt securities, with an average maturity of approximately one year, and are classified as available-for-sale. These investments are accounted for in accordance with Accounting Standards Codification (“ASC”) 320-10, “Investments — Debt and Equity Securities.” At December 31, 2015 and 2014, the Company’s investment balances consisted solely of available-for-sale securities and were carried at fair value in accordance with ASC 820-10.

Line of Credit

Line of Credit	12 Months Ended
	Dec. 31, 2015
Line of Credit
Line of Credit	3. Line of Credit . The Company maintains a line of credit, which is collateralized by its available-for-sales investments. The total availability under the line of credit is $7,500,000 and outstanding amounts would bear interest at the 30-day LIBOR rate plus 2% (effective rate of 2.43% as of December 31, 2015). There were no amounts outstanding on this line of credit at any time during the years ended December 31, 2015 and 2014.

Selling Arrangement

Selling Arrangement	12 Months Ended
	Dec. 31, 2015
Selling Arrangement
Selling Arrangement	4. Selling Arrangement . In 2011, the Company paid News America Marketing In-Store, LLC (News America) $4,000,000 in exchange for a 10-year arrangement to sell signs with price into News America’s network of retailers as News America’s exclusive agent. The $4,000,000 is being amortized on a straight-line basis over the 10-year term of the arrangement. Amortization expense, which was $400,000 for each of the years ended December 31, 2015 and 2014, and is expected to be $400,000 per year over the next five years, is recorded within cost of services in the Company’s statements of comprehensive income. The net carrying amount of the selling arrangement is recorded within other assets on the Company’s balance sheet. A summary of the carrying amount of this selling arrangement is as follows as of December 31: 2015 2014 Gross cost $ $ Accumulated amortization ) ) Net carrying amount $ $

Retail Access and Distribution

Retail Access and Distribution Agreement	12 Months Ended
	Dec. 31, 2015
Retail Access and Distribution Agreement
Retail Access and Distribution Agreement	5. Retail Access and Distribution Agreement. On February 21, 2014, the Company and Valassis Sales and Marketing Services, Inc. (“Valassis”) entered into the Retail Access and Distribution Agreement (the “New Valassis Agreement”) that replaced all prior agreements. As a result of this new agreement, Valassis was no longer a reseller of the Company’s POPSign and the Company regained access to all consumer packaged goods manufacturers for the sale of POPSigns. The net amount paid to Valassis by the Company was $250,000, which is being amortized over the original term of the New Valassis Agreement, which is approximately four years. The net carrying amount of $128,000 is included in other assets on the Company’s balance sheet as of December 31, 2015. Amortization expense related to this agreement was approximately $64,000 during the year ended December 31, 2015 and $59,000 during the year ended December 31, 2014.

Property and Equipment

Property and Equipment	12 Months Ended
	Dec. 31, 2015
Property and Equipment
Property and Equipment	6. Property and Equipment . Property and equipment consists of the following at December 31: Year ended December 31 2015 2014 Property and Equipment: Production tooling, machinery and equipment $ $ Office furniture and fixtures Computer equipment and software Web site Leasehold improvements — Construction in-progress Accumulated depreciation and amortization ) ) Net Property and Equipment $ $ Depreciation expense for the years ended December 31, 2015 and 2014 was $665,000 and $702,000, respectively.

Commitments and Contingencies

Commitments and Contingencies	12 Months Ended
	Dec. 31, 2015
Commitments and Contingencies
Commitments and Contingencies	7. Commitments and Contingencies. Operating Leases . On September 14, 2015, the Company amended the lease for its headquarters to extend the term for five years, through March 31, 2021, and to reduce the square footage and rental rate per square foot effective January 1, 2016. Rent expense under the prior lease, excluding operating costs, was approximately $318,000 in the year ended December 31, 2015 and $445,000 in the year-ended December 31, 2014. During the year ended December 31, 2014, the Company abandoned a portion of its office space for the remaining lease term, which resulted in an expense of approximately $118,000. In connection with the amended lease, the Company incurred costs related to the build-out of its facility and other relocation costs, as well as costs for new furniture and equipment, a portion of which will be funded by a tenant allowance of $275,000, which was recorded as deferred rent and other assets as of December 31, 2015. Minimum future lease obligations under the amended lease, excluding operating costs, are approximately as follows for the years ending December 31: 2016 $ 2017 2018 2019 2020 Thereafter Retailer Agreements . The Company has contracts in the normal course of business with various retailers, some of which provide for fixed or store-based payments rather than sign placement-based payments resulting in minimum commitments each year in order to maintain the agreements. During the years ended December 31, 2015 and 2014, the Company incurred $3,661,000 and $2,585,000 of costs related to fixed and store-based payments, respectively. The amounts are recorded in cost of services in the Company’s statements of comprehensive income. Aggregate commitment amounts under agreements with retailers are approximately as follows for the years ending December 31: 2016 $ 2017 2018 On an ongoing basis the Company negotiates renewals of various retailer agreements. Upon the completion of future contract renewals, the annual commitment amounts for 2016 and thereafter are expected to be in excess of the amounts above. Legal . The Company is subject to various legal matters in the normal course of business. The outcome of these matters is not expected to have a material effect on the Company’s financial position or results of operations.

Shareholders' Equity

Shareholders' Equity	12 Months Ended
	Dec. 31, 2015
Shareholders' Equity
Shareholders' Equity	8. Shareholders’ Equity . Stock-Based Compensation . The Company’s stock-based compensation plans are administered by the Compensation Committee of the Board of Directors, which selects persons to receive awards and determines the number of shares subject to each award and the terms, conditions, performance measures and other provisions of the award. The following table summarizes the stock-based compensation expense that was recognized in the Company’s statements of comprehensive income for the years ended December 31, 2015 and 2014: Year ended December 31 2015 2014 Cost of sales $ $ Selling Marketing General and administrative $ $ The Company uses the Black-Scholes option-pricing model to estimate fair value of stock-based awards with the following weighted average assumptions: 2015 2014 Stock Options: Expected life (years) Expected volatility % % Dividend yield % % Risk-free interest rate % % 2015 2014 Stock Purchase Plan Options: Expected life (years) Expected volatility % % Dividend yield % % Risk-free interest rate % % The Company uses the graded attribution method to recognize expense for unvested options and restricted stock units. The amount of stock-based compensation recognized during a period is based on the value of the awards that are ultimately expected to vest. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The Company re-evaluates the forfeiture rate annually and adjusts it as necessary. As of December 31, 2015, there was approximately $120,000 of total unrecognized compensation costs related to the outstanding stock options, which is expected to be recognized over a weighted average period of 1.8 years. As of December 31, 2015, there was approximately $149,000 of total unrecognized compensation costs related to restricted stock units, which is expected to be recognized over a weighted average period of 1.7 years. Stock Options, Restricted Stock Units, and Other Stock-Based Compensation Awards . The Company maintains the 2003 Incentive Stock Option Plan (the “2003 Plan”) and the 2013 Omnibus Stock and Incentive Plan (the “2013 Plan”). The 2013 Plan replaced the 2003 Plan upon its ratification by shareholders in 2013. Awards granted under the 2003 Plan will remain in effect until they are exercised or expire according to their terms. Since May 2013, all equity awards are made under the 2013 Plan. In May 2015, the 2013 Plan was amended to increase the total number of shares available to a total of 1,100,000 shares. Under the terms of the 2013 Plan, as amended, the Company may grant up to 1,100,000 awards in a variety of instruments including incentive or non-qualified stock options and restricted stock units to employees, consultants and directors generally at an exercise price at or above 100% of fair market value at the close of business on the date of grant. Stock options expire 10 years after the date of grant and generally vest over three years. The Company issues new shares of common stock when stock options are exercised. The following table summarizes activity under the 2003 and 2013 Plans: Plan Shares Available for Grant Plan Options Outstanding Weighted Average Exercise Price Per Share Aggregate Intrinsic Value Balance at December 31, 2013 $ Shares reserved — Stock awards granted ) — Restricted stock units granted ) — Stock options granted ) Stock options exercised — ) $ Cancelled or forfeited - 2013 Plan ) Cancelled of forfeited - 2003 Plan — ) Balance at December 31, 2014 Shares reserved — Stock awards granted ) — Restricted stock units granted ) — Stock options granted ) Stock options exercised — ) $ Cancelled or forfeited - 2013 Plan ) Cancelled or forfeited - 2013 Plan restricted stock units — Cancelled of forfeited - 2003 Plan — ) Balance at December 31, 2015 The number of options exercisable under the Plans was: December 31, 2015 653,840 December 31, 2014 710,598 The following table summarizes information about the stock options outstanding at December 31, 2015: Options Outstanding Options Exercisable Ranges of Exercise Prices Number Outstanding Weighted Average Remaining Contractual Life Weighted Average Exercise Price Per Share Number Exercisable Weighted Average Exercise Price Per Share $1.61 - $2.46 6.57 years $ $ $2.79 - $4.22 7.73 years $5.49 4.41 years 7.06 years $ $ Options outstanding under the Plans expire at various dates during the period from January 2015 through December 2024 . Options outstanding at December 31, 2015 had an aggregate intrinsic value of $404,000. Options exercisable at December 31, 2015 had a weighted average remaining life of 6.45 years and an aggregate intrinsic value of $395,000. The weighted average grant-date fair value of options granted during the years ended December 31, 2015 and 2014 were $0.94 and $1.13, respectively. In June 2015 and May 2014, equity grants were made by the Company to the Board of Directors, pursuant to the 2013 Plan in the form of shares of common stock. The total number of shares granted to the Board of Directors was 37,233 and 29,701 during the years ended December 31, 2015 and 2014, respectively. The shares were issued at $2.82 per share in 2015 and $3.03 per share in 2014, based on the stock price on the date of grant, for a total value of $105,000 in 2015 and $90,000 in 2014, which is included in stock-based compensation. The Company issued 99,000 restricted stock units, under the 2013 Plan, during the year ended December 31, 2015. The units were assigned a weighted average value of $2.71 per share, based on the stock price on the date of the grant, and vest over a weighted average of 2.3 years. The Company issued 25,000 restricted stock units during the year ended December 31, 2014. The units were assigned a value of $3.03 per share, based on the stock price on the date of the grant, and vest over three years. Restricted stock unit transactions during the years ended December 31, 2015 and 2014 are summarized as follows: Number of Shares Weighted average grant date fair value Unvested shares at January 1, 2014 — $ — Granted Vested — — Forfeited or surrendered — — Unvested shares at December 31, 2014 $ Granted Vested ) Forfeited or surrendered ) Unvested shares at December 31, 2015 Employee Stock Purchase Plan. The Company has an Employee Stock Purchase Plan (the “Plan”) that enables employees to contribute up to 10% of their base compensation toward the purchase of the Company’s common stock at 85% of its market value on the first or last day of the year. During the years ended December 31, 2015 and 2014, employees purchased 18,000 and 27,000 shares under the Plan. At December 31, 2015, 134,000 shares were reserved for future employee purchases of common stock under the Plan. For the years ended December 31, 2015 and 2014, the Company recognized $16,000 and $26,000, respectively, of stock-based compensation expense related to the Plan. Stock Repurchase Plans. On December 3, 2013, the Board of Directors authorized the repurchase of up to $5,000,000 of the Company’s common stock on or before December 3, 2015. The Plan allowed the repurchases to be made in open market or privately negotiated transactions. This plan was terminated on November 3, 2015. On October 30, 2015, the Board authorized the repurchase of up to $5,000,000 of the Company’s common stock on or before October 30, 2017. The plan allows the repurchases to be made in open market or privately negotiated transactions. The plan does not obligate the Company to repurchase any particular number of shares, and may be suspended at any time at the Company’s discretion. For the years ended December 31, 2015 and December 31, 2014, the Company repurchased approximately 664,000 and 787,000 shares at a total cost of $1,762,000 and $2,450,000, respectively.

Income Taxes

Income Taxes	12 Months Ended
	Dec. 31, 2015
Income Taxes
Income Taxes	9. Income Taxes . I ncome tax expense consists of the following: Year Ended December 31 2015 2014 Current taxes - Federal $ $ Current taxes - State Deferred taxes - Federal ) Deferred taxes - State Income tax expense $ $ The actual tax expense attributable to income before taxes differs from the expected tax expense computed by applying the U.S. federal corporate income tax rate of 34% as follows: Year Ended December 31 2015 2014 Federal statutory rate % % Stock-based awards State taxes Other permanent differences Impact of uncertain tax positions Other ) ) Effective federal income tax rate % % For the year ended December 31, 2015 the Company has adopted Accounting Standard Update (ASU) 2015-17 to present balance sheet classification of deferred income taxes as noncurrent. As of December 31, 2014, $52,000 of current deferred tax assets were reclassified to noncurrent deferred income tax liabilities. Components of resulting noncurrent deferred tax assets (liabilities) are as follows: As of December 31 2015 2014 Deferred tax assets Accrued expenses $ $ Stock-based awards Reserve for bad debts Inventory reserve Net operating loss carryforwards — Other Total deferred tax assets $ $ Deferred tax liabilities Depreciation $ ) $ ) Prepaid expenses ) — Prepaid compensation ) ) Total deferred tax liabilities ) ) Net deferred income tax liabilities $ ) $ ) The Company evaluates all significant available positive and negative evidence, including the existence of losses in prior years and its forecast of future taxable income, in assessing the need for a valuation allowance. The underlying assumptions the Company uses in forecasting future taxable income require significant judgment and take into account the Company’s recent performance. The Company has recorded a liability of $528,000 and $486,000 for uncertain tax positions taken in tax returns in previous years as of December 31, 2015 and 2014, respectively. This liability is reflected as Accrued Income Taxes on the Company’s Balance Sheets. The Company files income tax returns in the United States and numerous state and local tax jurisdictions. Tax years 2012 and forward are open for examination and assessment by the Internal Revenue Service. With limited exceptions, tax years prior to 2012 are no longer open in major state and local tax jurisdictions. The Company does not anticipate that the total unrecognized tax benefits will change significantly prior to December 31, 2016. A reconciliation of the beginning and ending amount of the liability for uncertain tax positions is as follows: Balance at January 1, 2014 $ Increases due to current year positions Increases due to interest Balance at December 31, 2014 Increases due to current year positions Increases due to interest Balance at December 31, 2015 $

Employee Benefit Plans

Employee Benefit Plans	12 Months Ended
	Dec. 31, 2015
Employee Benefit Plans
Employee Benefit Plans	10. Employee Benefit Plans . The Company sponsors a Retirement Profit Sharing and Savings Plan under Section 401(k) of the Internal Revenue Code. The plan allows employees to defer up to 50% of their wages, subject to Federal limitations, on a pre-tax basis through contributions to the plan. During the years ended December 31, 2015 and 2014, the Company made matching contributions of $70,000 and $69,000, respectively.

Concentrations

Concentrations	12 Months Ended
	Dec. 31, 2015
Concentrations
Concentrations	11. Concentrations. Major Customers . During the year ended December 31, 2015, one customer accounted for 37% of the Company’s total net sales. At December 31, 2015, one customer represented 62% of the Company’s total accounts receivable. During the year ended December 31, 2014, two customers accounted for 33% and 10% of the Company’s total net sales. At December 31, 2014, one customer represented 48% of the Company’s total accounts receivable. Although there are a number of customers that the Company sells to, the loss of a major customer could adversely affect operating results. Additionally, the loss of a major retailer from the Company’s retail network could adversely affect operating results. Export Sales . Export sales accounted for less than 1% of total net sales during the years ended December 31, 2015 and 2014.

Severance Accrual

Severance Accrual	12 Months Ended
	Dec. 31, 2015
Severance Accrual
Severance Accrual	12. Severance Accrual. During the year ended December 31, 2015, the Company recorded a net charge of $265,000 to general and administrative expenses relating to the resignation of the Company’s Chief Executive Officer. This net charge consisted of severance costs of $350,000, reduced by the effect of forfeitures of previously expensed unvested stock options and restricted stock unit awards that together totaled $85,000. A severance accrual of $350,000 is included in accrued compensation on the Company’s balance sheet as of December 31, 2015. This amount was paid in January 2016.

Quarterly Financial Data

Quarterly Financial Data	12 Months Ended
	Dec. 31, 2015
Quarterly Financial Data
Quarterly Financial Data	13. Quarterly Financial Data . (Unaudited) Quarterly data for the years ended December 31, 2015 and 2014 was as follows: Year Ended December 31, 2015 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Net sales $ $ $ $ Gross profit Net income Net income per share: Basic $ $ $ $ Diluted $ $ $ $ Year Ended Dece mber 31, 2014 Net sales $ $ $ $ Gross profit Net income (loss) ) Net income (loss) per share: Basic $ $ $ $ ) Diluted $ $ $ $ )

Summary of Significant Accoun20

Summary of Significant Accounting Policies (Policies)	12 Months Ended
	Dec. 31, 2015
Summary of Significant Accounting Policies
Description of Business	Description of Business . Insignia Systems, Inc. (the “Company”) markets in-store advertising products, programs and services to retailers and consumer packaged goods manufacturers. The Company operates in a single reportable segment. The Company’s products include the Insignia Point-of-Purchase Services (POPS ® ) in-store marketing program, thermal sign card supplies for the Company’s Impulse Retail System, and laser printable cardstock and label supplies. Additionally, in October 2014, the Company announced the introduction of a new product, The Like Machine TM , which is an in-store consumer approval device. The Company licenses this product from TLM Holdings, LLC (“TLMH”), a company in which Insignia’s Chief Sales and Marketing Officer, Tim Halfmann, is the majority owner and serves as a principal. In March 20l6, the Company and TLMH signed a new distribution agreement for the sale of The Like Machine to Insignia’s customers. This new agreement replaces the Company’s prior license agreement with TLMH. Mr. Halfmann has resigned from Insignia, effective April 30, 2016 in order to focus his efforts more fully on The Like Machine product and its evolution going forward.
Revenue Recognition	Revenue Recognition . Revenues are recognized by the Company when persuasive evidence of an arrangement exists, shipment has occurred, the price is fixed, and collectability is reasonably assured. The Company recognizes revenue from Insignia POPSigns and The Like Machine ratably over the period of service. The Company recognizes revenue related to equipment and sign card sales at the time the products are shipped to customers. Revenue associated with maintenance agreements is recognized ratably over the life of the contract. Revenue that has been billed and not yet earned is reflected as deferred revenue on the balance sheet . We account for taxes collected for customers on a net basis. In May 2014, the Financial Accounting Standards Board (“FASB”) issued guidance creating Accounting Standards Codification (“ASC”) Section 606, “Revenue from Contracts with Customers”. The new section will replace Section 605, “Revenue Recognition” and creates modifications to various other revenue accounting standards for specialized transactions and industries. The section is intended to conform revenue accounting principles with a concurrently issued International Financial Reporting Standards with previously differing treatment between United States practice and those of much of the rest of the world, as well as, to enhance disclosures related to disaggregated revenue information. The updated guidance is effective for annual reporting periods beginning after December 15, 2017, and interim periods within that reporting period. Early application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. The Company is studying the implications of this guidance in order to evaluate the expected impact on its financial statements.
Cash and Cash Equivalents	Cash and Cash Equivalents . The Company considers all highly liquid investments with an original maturity date of three months or less to be cash equivalents. Cash equivalents are stated at cost, which approximates fair value. At December 31, 2015, $7,815,000 was invested in an insured cash sweep account. At December 31, 2014, $6,329,000 was invested in an overnight repurchase account and $500,000 was invested in certificates of deposit. The balances in cash accounts, at times, may exceed federally insured limits. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash and cash equivalents. Amounts held in checking accounts during the years ended December 31, 2015 and 2014, were fully insured under the Federal Deposit Insurance Corporation (“FDIC”). Amounts held in insured cash sweep accounts during the year ended December 31, 2015 were fully insured under the FDIC. Amounts held in repurchase accounts during the years ended December 31, 2015 and 2014, were secured by Federal Home Loan securities and were fully insured by the FDIC. Bank certificates of deposit at December 31, 2014, were held at various institutions with amounts at each institution at or below the $250,000 insured limit of the FDIC.
Fair Value of Financial Measurements	Fair Value of Financial Measurements . Fair value of financial instruments and selected non-financial assets and liabilities is measured in accordance with ASC 820-10, “Fair Value Measurements.” Fair value is defined as the exit price, or the amount that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants as of the measurement date. ASC 820-10 also establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would use in valuing the asset or liability, developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect management’s assumptions about the factors market participants would use in valuing the asset or liability developed based upon the best information available in the circumstances. The hierarchy is divided into three levels. Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 inputs include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active and inputs (other than quoted prices) that are observable for the asset or liability, either directly or indirectly. Level 3 inputs are unobservable inputs for the asset or liability. Categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Certain of the Company’s financial assets and liabilities are recorded at their carrying amounts that approximate fair value, based on their short-term nature. These financial assets and liabilities include cash and cash equivalents, accounts receivable and accounts payable. The Company measures its available-for-sale investments at fair value on a recurring basis and the fair value hierarchy used to determine these fair values is as follows as of December 31, 2015 and 2014: Fair Value Measurements Using Total Carrying Value at December 31 Quoted Prices in Active Markests (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets as of December 31, 2015: Available-for-sale securities — — Assets as of December 31, 2014: Available-for-sale securities — — Available-for-sale securities in the preceding table are carried at fair value with unrealized gains and losses reported as a component of shareholders’ equity as accumulated other comprehensive loss, net of tax. Fair value for available-for-sale securities is based on quoted prices for similar assets in active markets or quoted prices for identical or similar assets in markets in which there were fewer transactions. Amortization of premiums or discounts arising at acquisition, and gains or losses on the disposition of available-for-sale securities are reported as other income. Realized gains and losses, if any, are calculated on the specific identification method and are included in other income in the statements of comprehensive income.
Accounts Receivable	Accounts Receivable . The majority of the Company’s accounts receivable is due from companies in the consumer packaged goods industry. Credit is extended based on evaluation of a customer’s financial condition and, generally, collateral is not required. Accounts receivable are due within 30-90 days and are stated at amounts due from customers, net of an allowance for doubtful accounts. Accounts receivable outstanding longer than the contractual payment terms are considered past due. The Company determines its allowance by considering a number of factors, including the length of time trade accounts receivable are past due, the Company’s previous loss history, the customer’s current ability to pay its obligation to the Company, and the condition of the general economy and the industry as a whole. The Company writes-off accounts receivable when they become uncollectible, and payments subsequently received on such receivables are credited to the allowance for doubtful accounts. Changes in the Company’s allowance for doubtful accounts are as follows: December 31 2015 2014 Beginning balance $ $ Bad debt provision ) Accounts written-off ) — Ending balance $ $
Inventories	Inventories . Inventories are primarily comprised of parts and supplies for the Impulse machine, sign cards, and roll stock. Inventory is valued at the lower of cost or market using the first-in, first-out (FIFO) method, and consists of the following: December 31 2015 2014 Raw materials $ $ Work-in-process Finished goods $ $
Property and Equipment	Property and Equipment . Property and equipment is recorded at cost. Significant additions or improvements extending asset lives are capitalized, while repairs and maintenance are charged to expense when incurred. Depreciation is provided in amounts sufficient to relate the cost of assets to operations over their estimated useful lives. The straight-line method of depreciation is used for financial reporting purposes and accelerated methods are used for tax purposes. Estimated useful lives of the assets are as follows: Production tooling, machinery and equipment 1 - 6 years Office furniture and fixtures 3 years Computer equipment and software 3 years Web development 3 years Leasehold improvements are amortized over the shorter of the remaining term of the lease or estimated life of the asset.
Impairment of Long-Lived Assets	Impairment of Long-Lived Assets . The Company records impairment losses on long-lived assets used in operations when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets are less than the assets’ carrying amount. Impaired assets are then recorded at their estimated fair value. There were no impairment losses during the years ended December 31, 2015 and 2014.
Income Taxes	Income Taxes . Income taxes are accounted for under the liability method. Deferred income taxes are provided for temporary differences between the financial reporting and tax basis of assets and liabilities. Deferred taxes are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or the entire deferred tax asset will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of the enactment. It is the Company’s policy to provide for uncertain tax positions and the related interest and penalties based upon management’s assessment of whether a tax benefit is more likely than not to be sustained upon examination by tax authorities. The Company recognizes interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense.
Stock-Based Compensation	Stock-Based Compensation . The Company measures and recognizes compensation expense for all stock-based payments at fair value. We use the Black-Scholes option pricing model to determine the weighted average fair value of options and employee stock purchase plan rights. The determination of fair value of share-based payment awards on the date of grant using an option-pricing model is affected by our stock price as well as by assumptions regarding a number of complex and subjective variables. These variables 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. Restricted stock units are valued at the closing market price of the Company’s stock date of the grant. The expected lives of the options and employee stock purchase plan rights are based on evaluations of historical and expected future employee exercise behavior. The risk-free interest rate is based on the U.S. Treasury rates at the date of grant with maturity dates approximately equal to the expected term at grant date. Volatility is based on historical and expected future volatility of the Company’s stock. The Company has not historically issued any dividends beyond a one-time dividend in 2011 and does not expect to in the future. Forfeitures are estimated at the time of the grant and revised, if necessary, in subsequent periods if actual forfeitures differ from estimates.
Advertising Costs	Advertising Costs . Advertising costs are charged to operations as incurred. Advertising expenses were approximately $42,000 and $183,000 during the years ended December 31, 2015 and 2014, respectively.
Net Income per Share	Net Income Per Share . Basic net income per share is computed by dividing net income by the weighted average shares outstanding and excludes any dilutive effects of stock options and restricted stock units. Diluted net income per share gives effect to all diluted potential common shares outstanding during the year. Weighted aver age common shares outstanding for the years ended December 31, 2015 and 2014 were as follows: Year ended December 31 2015 2014 Denominator for basic net income per share - weighted average shares Effect of dilutive securities: Stock options and restricted stock units Denominator for diluted net income per share - weighted average shares Options to purchase approximately 613,000 shares of common stock with a weighted average exercise price of $3.79 were outstanding at December 31, 2015 and were not included in the computation of common stock equivalents because their exercise prices were higher than the average fair market value of the common shares during the year. Options to purchase approximately 592,000 shares of common stock with a weighted average exercise price of $4.24 were outstanding at December 31, 2014 and were not included in the computation of common stock equivalents because their exercise prices were higher than the average fair market value of the common shares during the year.
Use of Estimates	Use of Estimates . The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from these estimates.

Summary of Significant Accoun21

Summary of Significant Accounting Policies (Tables)	12 Months Ended
	Dec. 31, 2015
Summary of Significant Accounting Policies
Schedule of Assets and Liabilities Measured at Fair Value on a Recurring Basis	Fair Value Measurements Using Total Carrying Value at December 31 Quoted Prices in Active Markests (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets as of December 31, 2015: Available-for-sale securities — — Assets as of December 31, 2014: Available-for-sale securities — —
Schedule Of Allowance For Doubtful Accounts	December 31 2015 2014 Beginning balance $ $ Bad debt provision ) Accounts written-off ) — Ending balance $ $
Schedule Of Inventories	December 31 2015 2014 Raw materials $ $ Work-in-process Finished goods $ $
Schedule Of Estimated Useful Lives	Production tooling, machinery and equipment 1 - 6 years Office furniture and fixtures 3 years Computer equipment and software 3 years Web development 3 years
Schedule Of Weighted Average Common Shares Outstanding	Year ended December 31 2015 2014 Denominator for basic net income per share - weighted average shares Effect of dilutive securities: Stock options and restricted stock units Denominator for diluted net income per share - weighted average shares

Selling Arrangement (Tables)

Selling Arrangement (Tables)	12 Months Ended
	Dec. 31, 2015
Selling Arrangement
Summary of the Carrying Amount of the Selling Arrangement	2015 2014 Gross cost $ $ Accumulated amortization ) ) Net carrying amount $ $

Property and Equipment (Tables)

Property and Equipment (Tables)	12 Months Ended
	Dec. 31, 2015
Property and Equipment
Schedule of Property and Equipment	Year ended December 31 2015 2014 Property and Equipment: Production tooling, machinery and equipment $ $ Office furniture and fixtures Computer equipment and software Web site Leasehold improvements — Construction in-progress Accumulated depreciation and amortization ) ) Net Property and Equipment $ $

Commitments and Contingencies (

Commitments and Contingencies (Tables)	12 Months Ended
	Dec. 31, 2015
Commitments and Contingencies
Schedule of Minimum Future Lease Obligations	2016 $ 2017 2018 2019 2020 Thereafter
Schedule of Aggregate Commitment Amounts	2016 $ 2017 2018

Shareholders' Equity (Tables)

Shareholders' Equity (Tables)	12 Months Ended
	Dec. 31, 2015
Shareholders' Equity
Summary of Stock-Based Compensation Expense	Year ended December 31 2015 2014 Cost of sales $ $ Selling Marketing General and administrative $ $
Schedule of Weighted Average Assumptions	2015 2014 Stock Options: Expected life (years) Expected volatility % % Dividend yield % % Risk-free interest rate % % 2015 2014 Stock Purchase Plan Options: Expected life (years) Expected volatility % % Dividend yield % % Risk-free interest rate % %
Summary of Activity Under Stock Option Plans	Plan Shares Available for Grant Plan Options Outstanding Weighted Average Exercise Price Per Share Aggregate Intrinsic Value Balance at December 31, 2013 $ Shares reserved — Stock awards granted ) — Restricted stock units granted ) — Stock options granted ) Stock options exercised — ) $ Cancelled or forfeited - 2013 Plan ) Cancelled of forfeited - 2003 Plan — ) Balance at December 31, 2014 Shares reserved — Stock awards granted ) — Restricted stock units granted ) — Stock options granted ) Stock options exercised — ) $ Cancelled or forfeited - 2013 Plan ) Cancelled or forfeited - 2013 Plan restricted stock units — Cancelled of forfeited - 2003 Plan — ) Balance at December 31, 2015
Schedule Of The Number Of Options Exercisable	December 31, 2015 653,840 December 31, 2014 710,598
Summary Of Information About Stock Options Outstanding	Options Outstanding Options Exercisable Ranges of Exercise Prices Number Outstanding Weighted Average Remaining Contractual Life Weighted Average Exercise Price Per Share Number Exercisable Weighted Average Exercise Price Per Share $1.61 - $2.46 6.57 years $ $ $2.79 - $4.22 7.73 years $5.49 4.41 years 7.06 years $ $
Summary of Restricted stock unit transactions	Number of Shares Weighted average grant date fair value Unvested shares at January 1, 2014 — $ — Granted Vested — — Forfeited or surrendered — — Unvested shares at December 31, 2014 $ Granted Vested ) Forfeited or surrendered ) Unvested shares at December 31, 2015

Income Taxes (Tables)

Income Taxes (Tables)	12 Months Ended
	Dec. 31, 2015
Income Taxes
Schedule Of Income Tax Expense	Year Ended December 31 2015 2014 Current taxes - Federal $ $ Current taxes - State Deferred taxes - Federal ) Deferred taxes - State Income tax expense $ $
Reconciliation Of Effective Income Tax Rate Percentage	Year Ended December 31 2015 2014 Federal statutory rate % % Stock-based awards State taxes Other permanent differences Impact of uncertain tax positions Other ) ) Effective federal income tax rate % %
Schedule of resulting noncurrent deferred tax assets (liabilities)	As of December 31 2015 2014 Deferred tax assets Accrued expenses $ $ Stock-based awards Reserve for bad debts Inventory reserve Net operating loss carryforwards — Other Total deferred tax assets $ $ Deferred tax liabilities Depreciation $ ) $ ) Prepaid expenses ) — Prepaid compensation ) ) Total deferred tax liabilities ) ) Net deferred income tax liabilities $ ) $ )
Reconciliation Of The Liability For Uncertain Tax Positions	Balance at January 1, 2014 $ Increases due to current year positions Increases due to interest Balance at December 31, 2014 Increases due to current year positions Increases due to interest Balance at December 31, 2015 $

Quarterly Financial Data (Table

Quarterly Financial Data (Tables)	12 Months Ended
	Dec. 31, 2015
Quarterly Financial Data
Schedule Of Quarterly Financial Data	Year Ended December 31, 2015 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Net sales $ $ $ $ Gross profit Net income Net income per share: Basic $ $ $ $ Diluted $ $ $ $ Year Ended Dece mber 31, 2014 Net sales $ $ $ $ Gross profit Net income (loss) ) Net income (loss) per share: Basic $ $ $ $ ) Diluted $ $ $ $ )

Summary of Significant Accoun28

Summary of Significant Accounting Policies - Cash and Cash Equivalents (Details) - USD ($)	Dec. 31, 2015	Dec. 31, 2014
Cash and Cash Equivalents
Insured cash sweep account	$ 7,815,000
Overnight repurchase account		$ 6,329,000
Certificates of deposit		$ 500,000

Summary of Significant Accoun29

Summary of Significant Accounting Policies - Fair Value (Details) - Recurring - USD ($)	Dec. 31, 2015	Dec. 31, 2014
Fair Value of Financial Measurements
Available-for-sale securities	$ 9,490,000	$ 9,698,000
Level 2
Fair Value of Financial Measurements
Available-for-sale securities	$ 9,490,000	$ 9,698,000

Summary of Significant Accoun30

Summary of Significant Accounting Policies - Doubtful Accounts (Details) - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Changes in allowance for doubtful accounts
Beginning balance	$ 89,000	$ 17,000
Bad debt provision	(5,000)	72,000
Accounts written-off	(5,000)
Ending balance	$ 79,000	$ 89,000

Summary of Significant Accoun31

Summary of Significant Accounting Policies - Inventories (Details) - USD ($)	Dec. 31, 2015	Dec. 31, 2014
Inventories
Raw materials	$ 69,000	$ 110,000
Work-in-process	4,000	8,000
Finished goods	318,000	405,000
Inventories	$ 391,000	$ 523,000

Summary of Significant Accoun32

Summary of Significant Accounting Policies - Property and Equipment (Details)	12 Months Ended
	Dec. 31, 2015
Production tooling, machinery and equipment. | Minimum
Property and Equipment
Estimated Useful lives	P1Y
Production tooling, machinery and equipment. | Maximum
Property and Equipment
Estimated Useful lives	P6Y
Office furniture and fixtures
Property and Equipment
Estimated Useful lives	P3Y
Computer equipment and software
Property and Equipment
Estimated Useful lives	P3Y
Web development
Property and Equipment
Estimated Useful lives	P3Y

Summary of Significant Accoun33

Summary of Significant Accounting Policies - (Details) - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Impairment of Long-Lived Assets
Impairment losses on long-lived assets	$ 0	$ 0
Advertising Costs
Advertising expense	$ 42,000	$ 183,000
Net Income Per Share
Denominator for basic net income per share - weighted average shares	12,044,000	12,635,000
Effect of dilutive securities: Stock options and restricted stock units	172,000	238,000
Denominator for diluted net income per share - weighted average shares	12,216,000	12,873,000
Stock Options
Net Income Per Share
Options not included in computation because they were anti-dilutive	613,000	592,000
Weighted average exercise of price of options outstanding that were anti-dilutive	$ 3.79	$ 4.24

Line of Credit (Details)

Line of Credit (Details)	12 Months Ended
	Dec. 31, 2015USD ($)
Line of credit, available borrowing capacity	$ 7,500,000
Line of credit, effective rate	2.43%
Line of credit outstanding amount	$ 0
30-day LIBOR
Line of credit, basis spread on variable rate	2.00%

Selling Arrangement - News Amer

Selling Arrangement - News America Marketing (Details) - Selling Agreement - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2011
Selling Arrangement
Payment for arrangement to sell signs			$ 4,000,000
Term of arrangement			10 years
Amortization expense	$ 400,000	$ 400,000
2,016	400,000
2,017	400,000
2,018	400,000
2,019	400,000
2,020	$ 400,000

Selling Arrangement - Carrying

Selling Arrangement - Carrying Amount (Details) - Selling Agreement - USD ($)	Dec. 31, 2015	Dec. 31, 2014
Selling Arrangement
Gross cost	$ 4,000,000	$ 4,000,000
Accumulated amortization	(1,883,000)	(1,483,000)
Net carrying amount	$ 2,117,000	$ 2,517,000

Retail Access and Distributio37

Retail Access and Distribution Agreement (Details) - Valassis - USD ($)	Aug. 11, 2014	Dec. 31, 2015	Dec. 31, 2014
Retail access and distribution agreement
Marketing and service agreement amortization period	4 years
Total consideration paid for marketing and service agreement	$ 250,000
Carrying value of agreement included on other assets		$ 128,000
Marketing and Service Agreement Amortization expense		$ 64,000	$ 59,000

Property and Equipment (Details

Property and Equipment (Details) - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Property and Equipment
Gross Property and Equipment	$ 5,756,000	$ 5,992,000
Accumulated depreciation and amortization	(4,172,000)	(4,525,000)
Net Property and Equipment	1,584,000	1,467,000
Depreciation expense	665,000	702,000
Production tooling, machinery and equipment
Property and Equipment
Gross Property and Equipment	3,722,000	3,976,000
Office furniture and fixtures
Property and Equipment
Gross Property and Equipment	145,000	260,000
Computer equipment and software
Property and Equipment
Gross Property and Equipment	1,233,000	1,065,000
Web site
Property and Equipment
Gross Property and Equipment	40,000	40,000
Leasehold improvements
Property and Equipment
Gross Property and Equipment		616,000
Construction in-progress
Property and Equipment
Gross Property and Equipment	$ 616,000	$ 35,000

Commitments and Contingencies -

Commitments and Contingencies - Leases (Details) - USD ($)	Sep. 14, 2015	Dec. 31, 2015	Dec. 31, 2014
Extended lease term	5 years
Rent expense		$ 318,000	$ 445,000
Portion funded by tenant allowance		275,000
Minimum future lease obligations
2,016		151,000
2,017		206,000
2,018		211,000
2,019		217,000
2,020		222,000
Thereafter		$ 57,000
Accrued liabilities
Rent expense from partial abandonment of office space for remaining lease term			$ 118,000

Commitments and Contingencies40

Commitments and Contingencies - Retailer Agreements (Details) - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Commitments and Contingencies
Fixed and store-based payments	$ 3,661,000	$ 2,585,000
Aggregate commitment amounts under agreements with retailers
2,016	3,101,000
2,017	1,716,000
2,018	$ 246,000

Shareholders' Equity - Stockbas

Shareholders' Equity - Stockbased Compensation (Details) - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Amount recognized in Statements of Comprehensive Income-
Stock-based compensation expense	$ 353,000	$ 403,000
Cost of sales
Amount recognized in Statements of Comprehensive Income-
Stock-based compensation expense	34,000	6,000
Selling
Amount recognized in Statements of Comprehensive Income-
Stock-based compensation expense	69,000	87,000
Marketing
Amount recognized in Statements of Comprehensive Income-
Stock-based compensation expense	15,000	12,000
General and administrative
Amount recognized in Statements of Comprehensive Income-
Stock-based compensation expense	$ 235,000	$ 298,000

Shareholders' Equity - Weighted

Shareholders' Equity - Weighted Average (Details) - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	May. 31, 2015
Stock Options
Black-Scholes Option-Pricing model assumptions
Expected life	3 years 4 months 24 days	3 years 7 months 6 days
Expected volatility	45.00%	50.00%
Dividend yield	0.00%	0.00%
Risk-free interest rate	1.20%	1.00%
Unrecognized compensation
Total unrecognized compensation costs related to the outstanding stock options	$ 120,000
Total unrecognized compensation costs weighted average period of recognition	1 year 9 months 18 days
Employee Stock Purchase Plan
Black-Scholes Option-Pricing model assumptions
Expected life	1 year	1 year
Expected volatility	37.00%	50.00%
Dividend yield	0.00%	0.00%
Risk-free interest rate	0.30%	0.10%
Stock option disclosures
Exercise price, expressed as percentage of fair value on date of grant	85.00%
Restricted stock units
Unrecognized compensation
Total unrecognized compensation costs weighted average period of recognition	1 year 8 months 12 days
Total unrecognized compensation costs related to restricted stock units	$ 149,000
2013 Plan
Stock option disclosures
Awards reserved for issuance	1,100,000		1,100,000
2013 Plan | Stock Options
Stock option disclosures
Expiration period from date of grant	10 years
Vesting period	3 years
2013 Plan | Stock Options | Minimum
Stock option disclosures
Exercise price, expressed as percentage of fair value on date of grant	100.00%
2013 Plan | Restricted stock units
Stock option disclosures
Vesting period	2 years 3 months 18 days	3 years

Shareholders' Equity - Option P

Shareholders' Equity - Option Plans (Details) - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Plan Shares Available for Grant
Balance at the beginning of the period (in shares)	307,767	95,968
Shares reserved	200,000	650,000
Balance at the end of the period (in shares)	477,534	307,767
Stock Options
Plan Shares Available for Grant
Stock options granted (in shares)	(200,000)	(426,000)
Plan Options Outstanding
Balance at the beginning of the period (in shares)	1,255,077	1,251,442
Stock options granted (in shares)	200,000	426,000
Stock options exercised (in shares)	(113,837)	(155,407)
Balance at the end of the period (in shares)	895,161	1,255,077
Weighted Average Exercise Price Per Share
Balance at the beginning of the period (in dollars per share)	$ 2.86	$ 2.72
Stock options granted (in dollars per share)	2.82	3.02
Stock options exercised (in dollars per share)	1.90	1.94
Balance at the end of the period (in dollars per share)	$ 2.73	$ 2.86
Aggregate Intrinsic Value, Stock options exercised (in dollars)	$ 105,012	$ 217,694
Restricted stock units
Plan Shares Available for Grant
Restricted stock units granted (in shares)	(99,000)	(25,000)
2013 Plan | Board of Directors
Plan Shares Available for Grant
Stock awards granted (in shares)	(37,233)	(29,701)
2013 Plan | Stock Options
Plan Shares Available for Grant
Cancelled or forfeited (in shares)	279,000	42,500
Plan Options Outstanding
Cancelled or forfeited (in shares)	(279,000)	(42,500)
Weighted Average Exercise Price Per Share
Cancelled (in dollars per share)	$ 2.87	$ 3.03
2013 Plan | Restricted stock units
Plan Shares Available for Grant
Restricted stock units granted (in shares)	(99,000)	(25,000)
Cancelled or forfeited (in shares)	27,000
Weighted Average Exercise Price Per Share
Cancelled, restricted stock units (in dollars per share)	$ 2.89
2003 Plan | Stock Options
Plan Options Outstanding
Cancelled or forfeited (in shares)	(167,079)	(224,458)
Weighted Average Exercise Price Per Share
Cancelled (in dollars per share)	$ 4.13	$ 2.95

Shareholders' Equity - Price Ra

Shareholders' Equity - Price Range (Details) - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Options Outstanding
Number Outstanding (in shares)	895,161
Weighted Average Remaining Contractual Life	7 years 22 days
Weighted Average Exercise Price Per Share	$ 2.73
Options Exercisable
Number Exercisable (in shares)	653,840	710,598
Weighted Average Exercise Price Per Share	$ 2.66
Stock option disclosures
Aggregate intrinsic value of options outstanding (in dollars)	$ 404,000
Weighted average remaining life of options exercisable	6 years 5 months 12 days
Aggregate intrinsic value of options exercisable (in dollars)	$ 395,000
Weighted average grant-date fair value of options granted (in dollars per share)	$ 0.94	$ 1.13
Restricted stock units
Number of Shares
Outstanding at the beginning of the period (in shares)	25,000
Granted (in shares)	99,000	25,000
Vested ( in shares)	(8,334)
Forfeited or surrendered (in shares)	(27,000)
Outstanding at the end of the period (in shares)	88,666	25,000
Weighted average grant date fair value
Beginning balance fair value (per share)	$ 3.03
Granted (per share)	2.71	$ 3.03
Vested (per share)	3.03
Forfeited or surrendered (per share)	2.89
Ending balance fair value (per share)	2.72	$ 3.03
$1.61 - $2.46
Range of Exercise Prices
Lower (in dollars per share)	1.61
Upper (in dollars per share)	$ 2.46
Options Outstanding
Number Outstanding (in shares)	363,997
Weighted Average Remaining Contractual Life	6 years 6 months 26 days
Weighted Average Exercise Price Per Share	$ 1.78
Options Exercisable
Number Exercisable (in shares)	352,331
Weighted Average Exercise Price Per Share	$ 1.76
$2.79 - $4.22
Range of Exercise Prices
Lower (in dollars per share)	2.79
Upper (in dollars per share)	$ 4.22
Options Outstanding
Number Outstanding (in shares)	480,164
Weighted Average Remaining Contractual Life	7 years 8 months 23 days
Weighted Average Exercise Price Per Share	$ 3.16
Options Exercisable
Number Exercisable (in shares)	250,509
Weighted Average Exercise Price Per Share	$ 3.35
$ 5.49
Range of Exercise Prices
Exercise price (in dollars per share)	$ 5.49
Options Outstanding
Number Outstanding (in shares)	51,000
Weighted Average Remaining Contractual Life	4 years 4 months 28 days
Weighted Average Exercise Price Per Share	$ 5.49
Options Exercisable
Number Exercisable (in shares)	51,000
Weighted Average Exercise Price Per Share	$ 5.49
2013 Plan | Board of Directors
Stock option disclosures
Total number of shares granted to the Board of Directors (in shares)	37,233	29,701
Shares issue price (in dollars per share)	$ 2.82	$ 3.03
Total value of shares issued	$ 105,000	$ 90,000
2013 Plan | Restricted stock units
Stock option disclosures
Vesting period	2 years 3 months 18 days	3 years
Number of Shares
Granted (in shares)	99,000	25,000
Weighted average grant date fair value
Granted (per share)	$ 2.71	$ 3.03

Shareholders' Equity - Repurcha

Shareholders' Equity - Repurchase Plan (Details) - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Oct. 30, 2015	Dec. 03, 2013
Stock-Based Compensation:
Stock-based compensation expense	$ 353,000	$ 403,000
Stock Repurchase Plans
Repurchase of common stock, authorized			$ 5,000,000	$ 5,000,000
Repurchase of common stock, net	$ 1,762,000	$ 2,450,000
Common Stock
Stock Repurchase Plans
Repurchase of common stock, shares	664,000	787,000
Repurchase of common stock, net	$ 7,000	$ 8,000
Employee Stock Purchase Plan
Stock-Based Compensation:
Maximum percent of base compensation contributed towards purchase of shares	10.00%
Percent of market value for employee purchases	85.00%
Employees purchased shares	18,000	27,000
Shares are reserved for future employee purchases	134,000
Stock-based compensation expense	$ 16,000	$ 26,000

Income Taxes - Income Taxes (De

Income Taxes - Income Taxes (Details) - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Current taxes - Federal	$ 903,000	$ 204,000
Current taxes - State	74,000	37,000
Deferred taxes - Federal	(4,000)	51,000
Deferred taxes - State	33,000	6,000
Income tax expense	$ 1,006,000	298,000
Accounting Standards Update 2015 -17 - Balance Sheet Classification of Deferred Taxes | Adjustments for New Accounting Principle, Early Adoption
Current deferred tax assets		(52,000)
Noncurrent deferred income tax liabilities		$ 52,000

Income Taxes - Tax Reconciliati

Income Taxes - Tax Reconciliation (Details)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Reconciliation to effective federal income tax rate
Federal statutory rate	34.00%	34.00%
Stock options	1.20%	12.10%
State taxes	2.10%	2.30%
Other permanent differences	0.70%	5.30%
Impact of uncertain tax positions	1.70%	5.50%
Other	(0.10%)	(0.70%)
Effective federal income tax rate	39.60%	58.50%

Income Taxes - Deferred Tax Ass

Income Taxes - Deferred Tax Assets (Details) - USD ($)	Dec. 31, 2015	Dec. 31, 2014
Deferred Tax Assets:
Accrued expenses	$ 126,000	$ 68,000
Stock-based awards	83,000	73,000
Reserve for bad debts	29,000	32,000
Inventory reserve	12,000	13,000
Net operating loss carryforwards		32,000
Other	9,000	7,000
Total deferred tax assets	259,000	225,000
Deferred Tax Liabilities:
Depreciation	(322,000)	(324,000)
Prepaid expenses	(84,000)
Prepaid compensation	(52,000)	(71,000)
Total deferred tax liabilities	(458,000)	(395,000)
Net deferred income tax liabilities	$ (199,000)	$ (170,000)

Income Taxes - Uncertain Tax Po

Income Taxes - Uncertain Tax Positions (Details) - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Liability for uncertain tax positions
Balance at the beginning of the period	$ 486,000	$ 458,000
Increases due to current year positions	18,000	5,000
Increases due to interest	24,000	23,000
Balance at the end of the period	$ 528,000	$ 486,000

Employee Benefit Plans (Details

Employee Benefit Plans (Details) - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
401(k) Plan disclosures
Employee contribution percentage	50.00%
Matching employer contribution	$ 70,000	$ 69,000

Concentrations (Details)

Concentrations (Details)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Concentration Risk
Export sales of net sales	1.00%	1.00%
Net sales | Customer one
Concentration Risk
Customer's percentage of net sales	37.00%	33.00%
Net sales | Customer two
Concentration Risk
Customer's percentage of net sales		10.00%
Accounts receivable | Customer one
Concentration Risk
Customer's percentage of net sales	62.00%	48.00%

Severance Accrual (Details)

Severance Accrual (Details) - Chief Executive Officer	12 Months Ended
	Dec. 31, 2015USD ($)
Net charge to general and administrative expense relating to resignation of chief executive officer (CEO)	$ 265,000
Severance Costs	350,000
Forfeiture of stock options, restricted stock units	85,000
Severance Accrual	$ 350,000

Quarterly Financial Data (Detai

Quarterly Financial Data (Details) - USD ($)	3 Months Ended								12 Months Ended
	Dec. 31, 2015	Sep. 30, 2015	Jun. 30, 2015	Mar. 31, 2015	Dec. 31, 2014	Sep. 30, 2014	Jun. 30, 2014	Mar. 31, 2014	Dec. 31, 2015	Dec. 31, 2014
Quarterly Financial Data
Net sales	$ 7,449,000	$ 7,548,000	$ 6,673,000	$ 6,541,000	$ 6,038,000	$ 7,520,000	$ 6,344,000	$ 6,403,000	$ 28,211,000	$ 26,305,000
Gross profit	3,384,000	3,499,000	2,986,000	2,802,000	2,487,000	3,709,000	2,903,000	2,683,000	12,671,000	11,782,000
Net income (loss)	$ 627,000	$ 561,000	$ 250,000	$ 96,000	$ (398,000)	$ 424,000	$ 70,000	$ 115,000	$ 1,534,000	$ 211,000
Net income (loss) per share:
Basic	$ 0.05	$ 0.05	$ 0.02	$ 0.01	$ (0.03)	$ 0.03	$ 0.01	$ 0.01	$ 0.13	$ 0.02
Diluted	$ 0.05	$ 0.05	$ 0.02	$ 0.01	$ (0.03)	$ 0.03	$ 0.01	$ 0.01	$ 0.13	$ 0.02