Lendway (LDWY) 10-Q 5 Nov 21 2021 Q3 Quarterly report Financial data

Cover

Cover - shares	9 Months Ended
	Sep. 30, 2021	Nov. 03, 2021
Cover [Abstract]
Entity Registrant Name	INSIGNIA SYSTEMS INC/MN
Entity Central Index Key	0000875355
Document Type	10-Q
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Small Business	true
Entity Shell Company	false
Entity Emerging Growth Company	false
Entity Current Reporting Status	Yes
Document Period End Date	Sep. 30, 2021
Entity Filer Category	Non-accelerated Filer
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2021
Entity Common Stock Shares Outstanding		1,768,114
Document Quarterly Report	true
Document Transition Report	false
Entity File Number	1-13471
Entity Incorporation State Country Code	MN
Entity Tax Identification Number	41-1656308
Entity Address Address Line 1	212 Third Ave N
Entity Address Address Line 2	Ste 356
Entity Address City Or Town	Minneapolis
Entity Address State Or Province	MN
Entity Address Postal Zip Code	55401
City Area Code	763
Local Phone Number	392-6200
Security 12b Title	Common Stock, $0.01 par value
Trading Symbol	ISIG
Security Exchange Name	NASDAQ
Entity Interactive Data Current	Yes

CONDENSED BALANCE SHEETS

CONDENSED BALANCE SHEETS - USD ($)	Sep. 30, 2021	Dec. 31, 2020
Current Assets:
Cash and cash equivalents	$ 3,649,000	$ 7,128,000
Restricted cash	85,000	0
Accounts receivable, net	4,203,000	5,857,000
Inventories	87,000	85,000
Income tax receivable	242,000	241,000
Prepaid expenses and other	837,000	711,000
Total Current Assets	9,103,000	14,022,000
Other Assets:
Property and equipment, net	114,000	75,000
Operating lease right-of-use assets	202,000	37,000
Other, net	37,000	155,000
Total Assets	9,456,000	14,289,000
Current Liabilities:
Accounts payable	1,506,000	3,148,000
Accrued liabilities:
Compensation	395,000	424,000
Sales tax	1,275,000	1,011,000
Other	842,000	1,071,000
Current portion of long-term debt	0	464,000
Current portion of operating lease liabilities	75,000	56,000
Deferred revenue	211,000	180,000
Total Current Liabilities	4,304,000	6,354,000
Long-Term Liabilities:
Accrued income taxes	703,000	677,000
Long-term debt, net of current portion	0	590,000
Operating lease liabilities	127,000	0
Total Long-Term Liabilities	830,000	1,267,000
Commitments and Contingencies	0	0
Shareholders' Equity:
Common stock, par value $.01: Authorized shares - 5,714,000, Issued and outstanding shares - 1,768,000 at September 30, 2021 and 1,748,000 at December 31, 2020, respectively	18,000	17,000
Additional paid-in capital	16,443,000	16,238,000
Accumulated deficit	(12,139,000)	(9,587,000)
Total Shareholders' Equity	4,322,000	6,668,000
Total Liabilities and Shareholders' Equity	$ 9,456,000	$ 14,289,000

CONDENSED BALANCE SHEETS (Paren

CONDENSED BALANCE SHEETS (Parenthetical) - $ / shares	Sep. 30, 2021	Dec. 31, 2020
CONDENSED BALANCE SHEETS
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	5,714,000	5,714,000
Common stock, shares issued	1,768,000	1,748,000
Common stock, shares outstanding	1,768,000	1,748,000

CONDENSED STATEMENTS OF OPERATI

CONDENSED STATEMENTS OF OPERATIONS (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
CONDENSED STATEMENTS OF OPERATIONS (Unaudited)
Services revenues	$ 3,493,000	$ 4,317,000	$ 14,975,000	$ 11,850,000
Products revenues	0	118,000	0	578,000
Total Net Sales	3,493,000	4,435,000	14,975,000	12,428,000
Cost of services	2,948,000	3,764,000	12,293,000	9,953,000
Cost of goods sold	0	112,000	0	492,000
Impairment loss - services	0	0	0	159,000
Total Cost of Sales	2,948,000	3,876,000	12,293,000	10,604,000
Gross Profit	545,000	559,000	2,682,000	1,824,000
Operating Expenses:
Selling	425,000	585,000	1,406,000	2,232,000
Marketing	266,000	192,000	761,000	800,000
General and administrative	779,000	840,000	4,052,000	2,836,000
Gain on sale of business	0	(195,000)		(195,000)
Total Operating Expenses	1,470,000	1,422,000	6,219,000	5,673,000
Operating Loss	(925,000)	(863,000)	(3,537,000)	(3,849,000)
Other income (expense):
Gain on forgiveness of debt and accrued interest	0	0	1,062,000	0
Interest income (expense)	14,000	(21,000)	(46,000)	(55,000)
Miscellaneous	(1,000)	6,000	1,000	47,000
Loss Before Taxes	(912,000)	(878,000)	(2,520,000)	(3,857,000)
Income tax expense (benefit)	9,000	8,000	32,000	(203,000)
Net Loss	$ (921,000)	$ (886,000)	$ (2,552,000)	$ (3,654,000)
Net loss per share:
Basic	$ (0.52)	$ (0.51)	$ (1.45)	$ (2.11)
Diluted	$ (0.52)	$ (0.51)	$ (1.45)	$ (2.11)
Shares used in calculation of net loss per share:
Basic	1,766,000	1,740,000	1,757,000	1,730,000
Diluted	1,766,000	1,740,000	1,757,000	1,730,000

CONDENSED STATEMENTS OF SHAREHO

CONDENSED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited) - USD ($)	Total	Common Stock	Additional Paid-In Capital	Retained Earnings (Accumulated Deficit)
Balance, shares at Dec. 31, 2019		1,725,000
Balance, amount at Dec. 31, 2019	$ 11,083,000	$ 16,000	$ 16,039,000	$ (4,972,000)
Value of stock-based compensation, Shares		0
Value of stock-based compensation	49,000	$ 0	49,000	0
Issuance of common stock, net, shares		5,000
Issuance of common stock, net, amount	20,000	$ 0	20,000	0
Net loss	(925,000)	$ 0	0	(925,000)
Balance, shares at Mar. 31, 2020		1,730,000
Balance, amount at Mar. 31, 2020	10,227,000	$ 16,000	16,108,000	(5,897,000)
Balance, shares at Dec. 31, 2019		1,725,000
Balance, amount at Dec. 31, 2019	11,083,000	$ 16,000	16,039,000	(4,972,000)
Net loss	(3,654,000)
Balance, shares at Sep. 30, 2020		1,749,000
Balance, amount at Sep. 30, 2020	7,602,000	$ 17,000	16,211,000	(8,626,000)
Balance, shares at Mar. 31, 2020		1,730,000
Balance, amount at Mar. 31, 2020	10,227,000	$ 16,000	16,108,000	(5,897,000)
Value of stock-based compensation, Shares		0
Value of stock-based compensation	59,000	0	59,000	0
Net loss	(1,843,000)	$ 0	0	(1,843,000)
Repurchase of common stock upon vesting of restricted stock units, shares		4,000
Repurchase of common stock upon vesting of restricted stock units, amount	0	$ 0	0	0
Balance, shares at Jun. 30, 2020		1,734,000
Balance, amount at Jun. 30, 2020	8,443,000	$ 16,000	16,167,000	(7,740,000)
Value of stock-based compensation, Shares		0
Value of stock-based compensation	37,000	0	37,000	0
Issuance of common stock, net, amount	9,000	0	9,000	0
Net loss	(886,000)	$ 0	0	(886,000)
Vesting of restricted stock units offset by repurchase of common stock upon vesting of retricted stock units and awards, shares		13,000
Vesting of restricted stock units offset by repurchase of common stock upon vesting of retricted stock units and awards, amount	(1,000)	$ 1,000	(2,000)	0
Common stock issued for accrued liabilities, shares		2,000
Balance, shares at Sep. 30, 2020		1,749,000
Balance, amount at Sep. 30, 2020	7,602,000	$ 17,000	16,211,000	(8,626,000)
Balance, shares at Dec. 31, 2020		1,748,000
Balance, amount at Dec. 31, 2020	6,668,000	$ 17,000	16,238,000	(9,587,000)
Value of stock-based compensation, Shares		$ 0
Value of stock-based compensation	56,000		56,000	0
Issuance of common stock, net, shares		6,000
Issuance of common stock, net, amount	26,000	$ 1,000	25,000	0
Net loss	(737,000)	$ 0	0	(737,000)
Balance, shares at Mar. 31, 2021		1,754,000
Balance, amount at Mar. 31, 2021	6,013,000	$ 18,000	16,319,000	(10,324,000)
Balance, shares at Dec. 31, 2020		1,748,000
Balance, amount at Dec. 31, 2020	6,668,000	$ 17,000	16,238,000	(9,587,000)
Net loss	(2,552,000)
Balance, shares at Sep. 30, 2021		1,768,000
Balance, amount at Sep. 30, 2021	4,322,000	$ 18,000	16,443,000	(12,139,000)
Balance, shares at Mar. 31, 2021		1,754,000
Balance, amount at Mar. 31, 2021	6,013,000	$ 18,000	16,319,000	(10,324,000)
Value of stock-based compensation, Shares		0
Value of stock-based compensation	86,000	0	86,000	0
Net loss	(894,000)	$ 0	0	(894,000)
Repurchase of common stock upon vesting of restricted stock units, shares		11,000
Repurchase of common stock upon vesting of restricted stock units, amount	(9,000)	$ 0	(9,000)	0
Balance, shares at Jun. 30, 2021		1,765,000
Balance, amount at Jun. 30, 2021	5,196,000	$ 18,000	16,396,000	(11,218,000)
Value of stock-based compensation, Shares		0
Value of stock-based compensation	56,000	0	56,000	0
Net loss	(921,000)	$ 0	0	(921,000)
Repurchase of common stock upon vesting of restricted stock units, shares		3,000
Repurchase of common stock upon vesting of restricted stock units, amount	(9,000)	$ 0	(9,000)	0
Balance, shares at Sep. 30, 2021		1,768,000
Balance, amount at Sep. 30, 2021	$ 4,322,000	$ 18,000	$ 16,443,000	$ (12,139,000)

CONDENSED STATEMENTS OF CASH FL

CONDENSED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)	9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020
Operating Activities:
Net loss	$ (2,552,000)	$ (3,654,000)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	46,000	386,000
Impairment loss	0	159,000
Gain on sale of business	(7,000)	(195,000)
Changes in allowance for doubtful accounts	34,000	112,000
Stock-based compensation expense	198,000	145,000
Gain on forgiveness of debt and accrued interest	(1,062,000)	0
Changes in operating assets and liabilities:
Accounts receivable	1,620,000	1,810,000
Inventories	(2,000)	80,000
Income tax receivable	(1,000)	(121,000)
Prepaid expenses and other	(27,000)	(148,000)
Accounts payable	(1,655,000)	(768,000)
Accrued liabilities	28,000	346,000
Accrued income taxes	26,000	25,000
Deferred revenue	31,000	176,000
Net cash used in operating activities	(3,323,000)	(1,647,000)
Investing Activities:
Purchases of property and equipment	(81,000)	(56,000)
Proceeds from sale of custom print business	0	200,000
Proceeds from sale of property and equipment	16,000	0
Net cash provided by (used in) investing activities	(65,000)	144,000
Financing Activities:
Cash dividends paid ($0.70 per share)	(14,000)	(14,000)
Proceeds from issuance of common stock, net	26,000	20,000
Repurchase of common stock upon vewsting of restricted stock awards	(18,000)	(1,000)
Proceeds from PPP loan	0	1,054,000
Net cash provided by (used in) financing activities	(6,000)	1,059,000
Decrease in cash and cash equivalents	(3,394,000)	(444,000)
Cash and cash equivalents and restricted cash at beginning of period	7,128,000	7,510,000
Cash and cash equivalents and restricted cash at end of period	3,734,000	7,066,000
Supplemental disclosures for cash flow information:
Cash refunded during the period for income taxes	6,000	107,000
Purchases of property and equipment included in accounts payable	13,000	22,000
Common stock issued for accrued liabilities	0	9,000
Receivables recorded from sale of cusom print business	0	100,000
Operating lease right of use asset obtained in exchange for lease obligations	219,000	0
Forgiveness of debt and accrued interest	$ 1,062,000	$ 0

Summary of Significant Accounti

Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2021
Summary of Significant Accounting Policies
1. Summary of Significant Accounting Policies	1. Summary of Significant Accounting Policies. Description of Business . Reverse Stock Split. Sale of Custom Print Business. Basis of Presentation . Cash and Cash Equivalents and Restricted Cash. September 30, December 31, 2021 2020 Cash and cash equivalents $ 3,649,000 $ 7,128,000 Restricted cash 85,000 — Total cash, cash equivalents and restricted cash $ 3,734,000 $ 7,128,000 Restricted Cash. Inventories . September 30, December 31, 2021 2020 Work-in-process $ 2,000 $ 2,000 Finished goods 85,000 83,000 $ 87,000 $ 85,000 Property and Equipment . September 30, December 31, 2021 2020 Property and Equipment: Production tooling, machinery and equipment $ 26,000 $ 2,349,000 Office furniture and fixtures 95,000 425,000 Computer equipment and software 740,000 1,447,000 Leasehold improvements 19,000 — Construction in-progress 4,000 17,000 884,000 4,238,000 Accumulated depreciation and amortization (770,000 ) (4,163,000 ) Net Property and Equipment $ 114,000 $ 75,000 Depreciation expense was approximately $14,000 and $46,000 in the three and nine months ended September 30, 2021, respectively, and was $85,000 and $255,000 in the three and nine months ended September 30, 2020, respectively. Stock-Based Compensation During the nine months ended September 30, 2021 and 2020, no equity awards were issued by the Company, except those awarded to non-employee members of the Board of Directors. In June 2021, non-employee members of the Board of Directors received restricted stock grants totaling 5,514 shares pursuant to the 2018 Equity Incentive Plan (the “2018 Plan”). The shares underlying the awards were assigned a value of $8.16 per share, which was the closing price of the Company’s common stock on the date of grant, for a total grant date value of $45,000. The shares are scheduled to vest the day immediately preceding the date of the next annual shareholder meeting. The awards granted to directors in December 2020 vested in full on the day immediately preceding the date of the 2021 annual shareholder meeting, June 9, 2021. In July 2020, the Company issued 11,053 shares of common stock in settlement of $9,000 of total deferred fees as a result of a non-employee director’s departure from the Board of Directors. The Company’s non-employee directors are eligible to participate in a director deferred compensation plan, which allows a director to make voluntary deferrals of up to 100% of their annual cash retainers relating to Board and committee service. The Company estimated the fair value of stock-based awards granted during the nine months ended September 30, 2021 under the Company’s employee stock purchase plan using the following weighted average assumptions: expected life of 1.0 year, expected volatility of 142.2%, dividend yield of 0% and risk-free interest rate of 0.1%. Total stock-based compensation expense recorded for the three and nine months ended September 30, 2021 was $56,000 and $198,000, respectively, and for the three and nine months ended September 30, 2020 was $37,000 and $145,000, respectively. Net Loss per Share . Due to the net loss incurred during the three and nine months ended September 30, 2021 and 2020 all outstanding stock options were anti-dilutive for the periods. Weighted average common shares outstanding for the three and nine months ended September 30, 2021 and 2020 were as follows: Three Months Ended Nine Months Ended September 30 September 30 2021 2020 2021 2020 Denominator for basic net loss per share - weighted average shares 1,766,000 1,740,000 1,757,000 1,730,000 Effect of dilutive securities: Stock options and restricted stock units — — — — Denominator for diluted net loss per share - weighted average shares 1,766,000 1,740,000 1,757,000 1,730,000

Revenue Recognition

Revenue Recognition	9 Months Ended
	Sep. 30, 2021
Revenue Recognition
2. Revenue Recognition	2. Revenue Recognition. Revenue from Contracts with Customers Taxes collected from customers and remitted to governmental authorities are excluded from revenue on the net basis of accounting. The Company includes shipping and handling fees in revenues. Shipping and handling costs associated with outbound freight after control over a product has been passed to a customer are accounted for as a fulfillment cost and are included in cost of goods sold. Performance Obligations A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account under Topic 606. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. The following is a description of the Company’s performance obligations included in its primary revenue streams and the timing or method of revenue recognition for each: In-Store Signage Solution Services. Each of the individual activities under the Company’s services, including production activities, are inputs to an integrated sign display service. Customers receive and consume the benefits from the promotional displays over the duration of the contracted display cycle. Additionally, the display of the signs does not have an alternative use to the Company and the Company has an enforceable right to payment for services performed to date. As a result, the Company recognizes the transaction price for service performance obligations as revenue over time. Given the nature of the Company’s performance obligations is to provide a display service over the duration of a specified period or periods, the Company recognizes revenue on a straight-line basis over the display service period as it best reflects the timing of transfer of its sign solutions. Non-POPS Solutions Products . Disaggregation of Revenue In the following table, revenue is disaggregated by major revenue stream and timing of revenue recognition. Three months ended September 30, 2021 Nine months ended September 30, 2021 Services Revenues Products Revenue Total Revenue Services Revenues Products Revenue Total Revenue Timing of revenue recognition: Products and services transferred over time $ 1,482,000 $ - $ 1,482,000 $ 5,366,000 $ - $ 5,366,000 Products and services transferred at a point in time 2,011,000 - 2,011,000 9,609,000 - 9,609,000 Total $ 3,493,000 $ - $ 3,493,000 $ 14,975,000 $ - $ 14,975,000 Three months ended September 30, 2020 Nine months ended September 30, 2020 Services Revenues Products Revenue Total Revenue Services Revenues Products Revenue Total Revenue Timing of revenue recognition: Products and services transferred over time $ 2,024,000 $ - $ 2,024,000 $ 7,366,000 $ - $ 7,366,000 Products and services transferred at a point in time 2,293,000 118,000 2,411,000 4,484,000 578,000 5,062,000 Total $ 4,317,000 $ 118,000 $ 4,435,000 $ 11,850,000 $ 578,000 $ 12,428,000 Contract Costs Sales commissions that are paid to internal or external sales representatives are eligible for capitalization as they are incremental costs that would not have been incurred without entering into a specific sales arrangement and are recoverable through the expected margin on the transaction. The Company is applying the practical expedient in Accounting Standards Codification 340-40-25-4 that allows the incremental costs of obtaining a contract to be recorded as an expense when incurred when the amortization period of the asset that would have otherwise been recognized is one year or less. These costs are included in selling expenses. Deferred Revenue Significant changes in deferred revenue during the period are as follows: Balance at December 31, 2020 $ 180,000 Reclassification of beginning deferred revenue to revenue, as a result of performance obligations satisfied (148,000 ) Cash received in advance and not recognized as revenue 179,000 Balance at September 30, 2021 $ 211,000 Transaction Price Allocated to Remaining Performance Obligations The Company applies the practical expedient in paragraph 606-10-50-14 and does not disclose information about remaining performance obligations that have original expected durations of one year or less, which reflect the majority of its performance obligations. This practical expedient is being applied to arrangements for certain incomplete services and unshipped custom signage materials. Among our contracts with an expected duration of greater than one year, we anticipate that revenue of $29,000, $116,000 and $60,000 related to performance obligations that are unsatisfied (or partially unsatisfied) as of September 30, 2021 will be recognized during the remainder of fiscal 2021, 2022 and 2023, respectively.

Selling Arrangement

Selling Arrangement	9 Months Ended
	Sep. 30, 2021
Selling Arrangement
3. Selling Arrangement.	3. Selling Arrangement.

Lease

Lease	9 Months Ended
	Sep. 30, 2021
Lease
4. Lease	4. Leases. The Company’s leases include options to renew. The exercise of lease renewal options is at the Company’s sole discretion. Therefore, the renewals to extend the lease terms are not included in the Company’s right of use assets and lease liabilities as they are not reasonably certain of exercise. The Company regularly evaluates the renewal options and when they are reasonably certain of exercise, the Company includes the renewal period in its lease term. The Company used its incremental borrowing rate in determining the present value of the lease payments based on the information available at the lease commencement date. The cost components of the Company’s operating leases were as follows for the periods ended September 30, 2021: Three months ended September 30, 2021 Prior Corporate Corporate Additional Operating Headquarters Headquarters Office Space Warehouse Leases Operating lease cost $ — $ 11,000 $ — $ 4,000 $ 11,000 Variable lease cost — 7,000 — 4,000 7,000 Short-term lease cost — — 7,000 — 7,000 Total $ — $ 18,000 $ 7,000 $ 8,000 $ 25,000 Nine months ended September 30, 2021 Prior Corporate Corporate Additional Operating Headquarters Headquarters Office Space Warehouse Leases Operating lease cost $ 38,000 $ 11,000 $ — $ 9,000 $ 58,000 Variable lease cost 24,000 7,000 — 9,000 40,000 Short-term lease cost — — 28,000 — 28,000 Total $ 62,000 $ 18,000 $ 28,000 $ 18,000 $ 126,000 Variable lease costs consist primarily of taxes, insurance, and common area or other maintenance costs which are paid based on actual costs incurred by the lessor. Maturities of the Company’s lease liabilities for is corporate headquarters and its warehouse operating leases are as follows as of September 30, 2021: Maturity of Lease Liabilities Operating Leases 2021 $ 21,000 2022 83,000 2023 72,000 2024 40,000 Total lease payments $ 216,000 Less: Interest 14,000 Present value of lease liabilities $ 202,000 The remaining lease terms as of September 30, 2021 for the Company’s corporate headquarters and its warehouse leases were 2.8 years and 1.5 years, respectively. The discount rate for both leases is 4.75%. The cash outflow for operating leases for the three and nine months ended September 30, 2021 was $15,000 and $76,000, respectively. The cash outflow for operating leases for the three and nine months ended September 30, 2020 was $86,000 and $178,000, respectively. Operating lease liabilities and right-of-use assets were increased for new non-cash leases by $219,000 for the nine months ended September 30, 2021.

Income Taxes

Income Taxes	9 Months Ended
	Sep. 30, 2021
Income Taxes
5. Income Taxes	5. Income Taxes. Deferred income taxes are determined based on the estimated future tax effects of differences between the financial statements and tax basis of assets and liabilities given the provisions of enacted tax laws. In providing for deferred taxes, the Company considers tax regulations of the jurisdictions in which we operate, estimates of future taxable income and available tax planning strategies. If tax regulations, operating results or the ability to implement tax-planning strategies vary, adjustment to the carrying value of deferred tax assets and liabilities may be required. Valuation allowances are recorded related to deferred tax assets based on the “more likely than not” criteria. At September 30, 2021 and December 31, 2020, the Company had a valuation allowance of approximately $2,811,000 and $1,946,000, respectively, against its entire net deferred tax asset because the Company does not believe it is more likely than not that it will realize its net deferred tax asset. As of September 30, 2021, and December 31, 2020, the Company had unrecognized tax benefits totaling $703,000 and $677,000, respectively, including interest, which relates to state nexus issues. The amount of the unrecognized tax benefits, if recognized, that would affect the effective income tax rates of future periods is $703,000. The Company believes that it is reasonably possible that a decrease of up to $650,000 in unrecognized tax benefits related to state exposures may be necessary within the coming year, which would reduce accrued income taxes and increase income tax benefit. In March 2020, Congress passed the Coronavirus Aid, Relief and Economic Security (“CARES”) Act. The CARES Act, among other provisions, allows for companies to carry back federal NOLs generated in 2018, 2019 and 2020 for up to five years for refunds of federal taxes paid. This provision created an opportunity for the Company to utilize NOLs not previously expected to be utilized. Thus, in 2020 the Company reversed approximately $215,000 of its valuation allowance against the NOLs in its deferred tax assets which the Company carried back to claim a refund of federal taxes paid. As the Company expects to receive the tax refund from the ability to carry back the NOLs within the next 12 months, this discrete benefit has been recorded within income taxes receivable on the balance sheet. In addition to the $215,000 recognized, $17,000 was included as a discrete tax benefit for 2020 and included in income taxes receivable related to the NOL carry back due to differences in the federal tax rate utilized for the deferred tax asset compared to the rates in effect for the years in which the NOL is being carried back.

Concentrations

Concentrations	9 Months Ended
	Sep. 30, 2021
Concentrations
6. Concentrations	6. Concentrations.

Legal Proceedings

Legal Proceedings	9 Months Ended
	Sep. 30, 2021
Legal Proceedings
7. Legal Proceedings	7. Legal Proceedings. In August 2019, News America filed an answer and counterclaim. In October 2019, News America moved for a judgment on the pleadings. Management believes that the counterclaim is without merit, and the Company filed a response brief on November 11, 2019. The Company also moved to dismiss the counterclaim against it. The court heard oral arguments from both parties on January 14, 2020, and subsequently denied both motions. On July 10, 2020 the parties cross-moved for summary judgment on the counterclaim. On December 7, 2020, the Court granted News America’s motion for summary judgment on the counterclaim in part, requiring Insignia to strike certain allegations from its complaint and finding News America’s request for attorneys’ fees and costs premature. Following the close of discovery, on August 27, 2021, News America moved for summary judgment on Insignia’s claims. On September 17, 2021, Insignia filed its response opposing summary judgment. On October 1, 2021, News America filed its reply brief. The court is scheduled to hear argument on the motion on January 26, 2022. At this stage of the proceedings, the Company is unable to determine the likelihood of an unfavorable outcome or estimate any potential resulting liability.

Loan

Loan	9 Months Ended
	Sep. 30, 2021
Loan
8. Loan	8. Loan. In accordance with the requirements of the CARES Act, the Company used the proceeds from the loan exclusively for qualified expenses under the PPP, including payroll costs, rent and utility costs, as further detailed in the CARES Act and applicable guidance issued by the SBA. Interest was accrued on the outstanding balance of the Note at a rate of 1.00% per annum. The Note was scheduled to mature on April 22, 2022 and required 18 equal monthly payments of principal and interest. The Company’s application for forgiveness of the entire principal amount and all accrued interest under the Note was approved by the SBA on January 29, 2021. Accordingly, for the nine months ended September 30, 2021 the debt of $1,054,000, plus accrued interest of $8,000, was eliminated with a gain on debt forgiveness and accrued interest included in other income.

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2021
Summary of Significant Accounting Policies
Description of Business	Description of Business .
Reverse Stock Split	Reverse Stock Split.
Sale of our Custom Print Business	Sale of Custom Print Business.
Basis of Presentation	Basis of Presentation .
Cash and Cash Equivalents and Restricted Cash	Cash and Cash Equivalents and Restricted Cash. September 30, December 31, 2021 2020 Cash and cash equivalents $ 3,649,000 $ 7,128,000 Restricted cash 85,000 — Total cash, cash equivalents and restricted cash $ 3,734,000 $ 7,128,000
Restricted Cash	Restricted Cash.
Inventories	Inventories . September 30, December 31, 2021 2020 Work-in-process $ 2,000 $ 2,000 Finished goods 85,000 83,000 $ 87,000 $ 85,000
Property and Equipment	Property and Equipment . September 30, December 31, 2021 2020 Property and Equipment: Production tooling, machinery and equipment $ 26,000 $ 2,349,000 Office furniture and fixtures 95,000 425,000 Computer equipment and software 740,000 1,447,000 Leasehold improvements 19,000 — Construction in-progress 4,000 17,000 884,000 4,238,000 Accumulated depreciation and amortization (770,000 ) (4,163,000 ) Net Property and Equipment $ 114,000 $ 75,000 Depreciation expense was approximately $14,000 and $46,000 in the three and nine months ended September 30, 2021, respectively, and was $85,000 and $255,000 in the three and nine months ended September 30, 2020, respectively.
Stock-Based Compensation	Stock-Based Compensation During the nine months ended September 30, 2021 and 2020, no equity awards were issued by the Company, except those awarded to non-employee members of the Board of Directors. In June 2021, non-employee members of the Board of Directors received restricted stock grants totaling 5,514 shares pursuant to the 2018 Equity Incentive Plan (the “2018 Plan”). The shares underlying the awards were assigned a value of $8.16 per share, which was the closing price of the Company’s common stock on the date of grant, for a total grant date value of $45,000. The shares are scheduled to vest the day immediately preceding the date of the next annual shareholder meeting. The awards granted to directors in December 2020 vested in full on the day immediately preceding the date of the 2021 annual shareholder meeting, June 9, 2021. In July 2020, the Company issued 11,053 shares of common stock in settlement of $9,000 of total deferred fees as a result of a non-employee director’s departure from the Board of Directors. The Company’s non-employee directors are eligible to participate in a director deferred compensation plan, which allows a director to make voluntary deferrals of up to 100% of their annual cash retainers relating to Board and committee service. The Company estimated the fair value of stock-based awards granted during the nine months ended September 30, 2021 under the Company’s employee stock purchase plan using the following weighted average assumptions: expected life of 1.0 year, expected volatility of 142.2%, dividend yield of 0% and risk-free interest rate of 0.1%. Total stock-based compensation expense recorded for the three and nine months ended September 30, 2021 was $56,000 and $198,000, respectively, and for the three and nine months ended September 30, 2020 was $37,000 and $145,000, respectively.
Net Income (Loss) per Share	Net Loss per Share . Due to the net loss incurred during the three and nine months ended September 30, 2021 and 2020 all outstanding stock options were anti-dilutive for the periods. Weighted average common shares outstanding for the three and nine months ended September 30, 2021 and 2020 were as follows: Three Months Ended Nine Months Ended September 30 September 30 2021 2020 2021 2020 Denominator for basic net loss per share - weighted average shares 1,766,000 1,740,000 1,757,000 1,730,000 Effect of dilutive securities: Stock options and restricted stock units — — — — Denominator for diluted net loss per share - weighted average shares 1,766,000 1,740,000 1,757,000 1,730,000

Summary of Significant Accoun_3

Summary of Significant Accounting Policies (Tables)	9 Months Ended
	Sep. 30, 2021
Summary of Significant Accounting Policies
Schedule of cash and cash equivalents
Inventories
Schedule of property and Equipment
Weighted average common shares outstanding	Three Months Ended Nine Months Ended September 30 September 30 2021 2020 2021 2020 Denominator for basic net loss per share - weighted average shares 1,766,000 1,740,000 1,757,000 1,730,000 Effect of dilutive securities: Stock options and restricted stock units — — — — Denominator for diluted net loss per share - weighted average shares 1,766,000 1,740,000 1,757,000 1,730,000

Revenue Recognition (Tables)

Revenue Recognition (Tables)	9 Months Ended
	Sep. 30, 2021
Revenue Recognition
Deferred revenue	Balance at December 31, 2020 $ 180,000 Reclassification of beginning deferred revenue to revenue, as a result of performance obligations satisfied (148,000 ) Cash received in advance and not recognized as revenue 179,000 Balance at September 30, 2021 $ 211,000
Disaggregation of revenue	Three months ended September 30, 2021 Nine months ended September 30, 2021 Services Revenues Products Revenue Total Revenue Services Revenues Products Revenue Total Revenue Timing of revenue recognition: Products and services transferred over time $ 1,482,000 $ - $ 1,482,000 $ 5,366,000 $ - $ 5,366,000 Products and services transferred at a point in time 2,011,000 - 2,011,000 9,609,000 - 9,609,000 Total $ 3,493,000 $ - $ 3,493,000 $ 14,975,000 $ - $ 14,975,000 Three months ended September 30, 2020 Nine months ended September 30, 2020 Services Revenues Products Revenue Total Revenue Services Revenues Products Revenue Total Revenue Timing of revenue recognition: Products and services transferred over time $ 2,024,000 $ - $ 2,024,000 $ 7,366,000 $ - $ 7,366,000 Products and services transferred at a point in time 2,293,000 118,000 2,411,000 4,484,000 578,000 5,062,000 Total $ 4,317,000 $ 118,000 $ 4,435,000 $ 11,850,000 $ 578,000 $ 12,428,000

Lease (Tables)

Lease (Tables)	9 Months Ended
	Sep. 30, 2021
Lease
Cost components of operating leases	Three months ended September 30, 2021 Prior Corporate Corporate Additional Operating Headquarters Headquarters Office Space Warehouse Leases Operating lease cost $ — $ 11,000 $ — $ 4,000 $ 11,000 Variable lease cost — 7,000 — 4,000 7,000 Short-term lease cost — — 7,000 — 7,000 Total $ — $ 18,000 $ 7,000 $ 8,000 $ 25,000 Nine months ended September 30, 2021 Prior Corporate Corporate Additional Operating Headquarters Headquarters Office Space Warehouse Leases Operating lease cost $ 38,000 $ 11,000 $ — $ 9,000 $ 58,000 Variable lease cost 24,000 7,000 — 9,000 40,000 Short-term lease cost — — 28,000 — 28,000 Total $ 62,000 $ 18,000 $ 28,000 $ 18,000 $ 126,000
Maturity of Lease Liabilities	Maturity of Lease Liabilities Operating Leases 2021 $ 21,000 2022 83,000 2023 72,000 2024 40,000 Total lease payments $ 216,000 Less: Interest 14,000 Present value of lease liabilities $ 202,000

Summary of Significant Accoun_4

Summary of Significant Accounting Policies (Details) - USD ($)	Sep. 30, 2021	Dec. 31, 2020
Summary of Significant Accounting Policies
Cash and cash equivalents	$ 3,649,000	$ 7,128,000
Restricted cash	85,000	0
Total cash, cash equivalents and retricted cash	$ 3,734,000	$ 7,128,000

Summary of Significant Accoun_5

Summary of Significant Accounting Policies (Details 1) - USD ($)	Sep. 30, 2021	Dec. 31, 2020
Inventories
Work-in-process	$ 2,000	$ 2,000
Finished goods	85,000	83,000
Inventories	$ 87,000	$ 85,000

Summary of Significant Accoun_6

Summary of Significant Accounting Policies (Details 2) - USD ($)	Sep. 30, 2021	Dec. 31, 2020
Gross property and equipment	$ 884,000	$ 4,238,000
Accumulated depreciation and amortization	(770,000)	(4,163,000)
Net property and equipment	114,000	75,000
Production Tooling, Machinery and Equipment
Gross property and equipment	26,000	2,349,000
Office Furniture and Fixtures
Gross property and equipment	95,000	425,000
Computer Equipment and Software
Gross property and equipment	740,000	1,447,000
Leasehold improvements
Gross property and equipment	19,000
Construction in-Progress
Gross property and equipment	$ 4,000	$ 17,000

Summary of Significant Accoun_7

Summary of Significant Accounting Policies (Details 3) - shares	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Summary of Significant Accounting Policies
Denominator for basic net loss per share - weighted average shares	1,766,000	1,740,000	1,757,000	1,730,000
Effect of dilutive securities:
Denominator for diluted net loss per share - weighted average shares	1,766,000	1,740,000	1,757,000	1,730,000

Summary of Significant Accoun_8

Summary of Significant Accounting Policies (Details Narrative) - USD ($)	1 Months Ended		3 Months Ended		6 Months Ended	9 Months Ended
	Aug. 31, 2020	Jul. 31, 2020	Sep. 30, 2021	Sep. 30, 2020	Jun. 30, 2021	Sep. 30, 2021	Sep. 30, 2020
Summary of Significant Accounting Policies
Sale of custom print business	$ 300,000
Deferred fees		$ 9,000
Common stock shares issued in settlement of deferred fee		11,053
Gain on sale of print business	195,000					$ (7,000)	$ (195,000)
Cash received	200,000
Short-term receivable	75,000
Long-term receivable	$ 25,000
Depreciation expense			$ 14,000	$ 85,000		$ 46,000	255,000
Restricted stock granted					5,514
Restricted stock price per share					$ 8.16
Fair value of restricted shares					$ 45,000
Stock-based awards granted, estimated life						1 year
Stock-based awards granted, expected volatility						142.20%
Stock-based awards granted, dividend yield						0.00%
Stock-based awards granted, risk-free interest rate						0.10%
Stock-based compensation expense			$ 56,000	$ 37,000		$ 198,000	$ 145,000

Revenue Recognition (Details)

Revenue Recognition (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Total Net Sales	$ 3,493,000	$ 4,435,000	$ 14,975,000	$ 12,428,000
Products and Services Transferred Over Time
Total Net Sales	1,482,000	2,024,000	5,366,000	7,366,000
Products and Services Transferred at a Point in Time
Total Net Sales	2,011,000	2,411,000	9,609,000	5,062,000
Services
Total Net Sales	3,493,000	4,317,000	14,975,000	11,850,000
Services | Products and Services Transferred Over Time
Total Net Sales	1,482,000	2,024,000	5,366,000	7,366,000
Services | Products and Services Transferred at a Point in Time
Total Net Sales	2,011,000	2,293,000	9,609,000	4,484,000
Products
Total Net Sales	0	118,000	0	578,000
Products | Products and Services Transferred Over Time
Total Net Sales	0	0	0	0
Products | Products and Services Transferred at a Point in Time
Total Net Sales	$ 0	$ 118,000	$ 0	$ 578,000

Revenue Recognition (Details 1)

Revenue Recognition (Details 1)	9 Months Ended
	Sep. 30, 2021USD ($)
Revenue Recognition
Deferred revenue, beginning	$ 180,000
Reclassification of beginning deferred revenue to revenue, as a result of performance obligations satisfied	(148,000)
Cash received in advance and not recognized as revenue	179,000
Deferred revenue, ending	$ 211,000

Revenue Recognition (Details Na

Revenue Recognition (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Revenue	$ 3,493,000	$ 4,435,000	$ 14,975,000	$ 12,428,000
2021
Revenue			29,000
2022
Revenue			116,000
2023
Revenue			$ 60,000

Selling Arrangement (Details Na

Selling Arrangement (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2020	Mar. 31, 2020	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2011
Impairment loss		$ 159,000	$ 0	$ 159,000
Amortization expense	$ 34,000			$ 131,000
Selling Arrangement
Sale agreement to News America					$ 4,000,000
Agreement term period					10 years
Sale agreement description					the Company paid to News America Marketing In-Store, L.L.C. (“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

Leases (Details)

Leases (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2019	Sep. 30, 2021	Sep. 30, 2019
Operating lease cost	$ 11,000	$ 38,000	$ 58,000	$ 113,000
Variable lease cost	7,000	28,000	40,000	87,000
Short-term lease cost	7,000	18,000	28,000	37,000
Total	25,000	84,000	126,000	237,000
Warehouse
Operating lease cost	4,000		9,000
Variable lease cost	4,000		9,000
Short-term lease cost	0		0
Total	8,000		18,000
Prior Corporate Headquarters
Operating lease cost	0		38,000
Variable lease cost	0		24,000
Short-term lease cost	0		0
Total	0		62,000
Corporate Headquarters
Operating lease cost	11,000	38,000	11,000	113,000
Variable lease cost	7,000	28,000	7,000	87,000
Short-term lease cost	0	0	0	0
Total	18,000	66,000	18,000	200,000
Additional Office Space
Operating lease cost	0	0	0	0
Variable lease cost	0	0	0	0
Short-term lease cost	7,000	18,000	28,000	37,000
Total	$ 7,000	$ 18,000	$ 28,000	$ 37,000

Leases (Details 1)

Leases (Details 1)	Sep. 30, 2021USD ($)
Lease
2021	$ 21,000
2022	83,000
2023	72,000
2024	40,000
Total lease payments	216,000
Less: interest	14,000
Present value of lease liabilities	$ 202,000

Leases (Details Narrative)

Leases (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Restricted cash	$ 85,000		$ 85,000
Increase in Operating lease liabilities and right-of-use			219,000
Cash outflow for operating leases	$ 15,000	$ 86,000	$ 76,000	$ 178,000
Warehouse
Remaining lease term			1 year 6 months
Discount rate	4.75%		4.75%
Corporate Headquarters
Remaining lease term			2 years 9 months 18 days
Discount rate	4.75%		4.75%

Income Taxes (Details Narrative

Income Taxes (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020
Income Taxes
Income tax benefit (expense)	$ 9,000	$ 8,000	$ 32,000	$ (203,000)
Income tax rate, percentage	1.00%	0.90%	1.30%	(5.30%)
Valuation allowance against NOLs deferred tax assets			$ 2,811,000		$ 1,946,000
Refunds of federal taxes paid period					5 years
Deferred tax asset valuation allowance					$ 215,000
Unrecognized tax benefits	$ 703,000		703,000		677,000
Discrete tax benefit			215,000		$ 17,000
Tax recognized amount			650,000
Unrecognized tax benefits recognized effective income tax rates of future periods	$ 703,000		$ 703,000

Concentrations (Details Narrati

Concentrations (Details Narrative)	9 Months Ended		12 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020
Customer One | Total Net Sales
Customer's concentration risk percentage	16.00%	13.00%
Customer One | Accounts Receivable
Customer's concentration risk percentage	16.00%		17.00%
Customer Two | Total Net Sales
Customer's concentration risk percentage	10.00%	11.00%
Customer Two | Accounts Receivable
Customer's concentration risk percentage	13.00%		10.00%

Loan (Details Narrative)

Loan (Details Narrative)	1 Months Ended	9 Months Ended
	Apr. 30, 2020USD ($)integer	Sep. 30, 2021USD ($)
Loan (Details Narrative)
Debt face amount		$ 1,054,000
Rate of interest per annum	1.00%
Laon maturity date	Apr. 22, 2022
Number of monthly payments of principal and interest | integer	18
Accrued interest		$ 8,000
Paycheck protection program loan amount	$ 1,054,000