Document And Entity Information
v3.8.0.1
Document And Entity Information - shares
9 Months Ended
Sep. 30, 2017
Nov. 01, 2017
Document And Entity Information [Abstract]    
Document Type 10-Q  
Amendment Flag false  
Document Period End Date Sep. 30, 2017  
Document Fiscal Period Focus Q3  
Document Fiscal Year Focus 2017  
Entity Registrant Name COMMUNICATIONS SYSTEMS INC  
Entity Central Index Key 0000022701  
Current Fiscal Year End Date --12-31  
Entity Filer Category Smaller Reporting Company  
Entity Common Stock, Shares Outstanding   8,969,037

Condensed Consolidated Balance Sheets
v3.8.0.1
Condensed Consolidated Balance Sheets - USD ($)
Sep. 30, 2017
Dec. 31, 2016
CURRENT ASSETS:    
Cash and cash equivalents $ 17,066,485 $ 10,443,274
Investments 725,112 5,805,276
Trade accounts receivable, less allowance for doubtful accounts of $117,000 and $77,000, respectively 13,807,564 14,552,191
Inventories 15,017,656 22,204,902
Prepaid income taxes 612,676 1,400,118
Other current assets 1,047,320 967,332
TOTAL CURRENT ASSETS 48,276,813 55,373,093
PROPERTY, PLANT AND EQUIPMENT, net 12,963,718 15,719,403
OTHER ASSETS:    
Goodwill   1,462,503
Other assets, net 19,803 622,017
TOTAL OTHER ASSETS 19,803 2,084,520
TOTAL ASSETS 61,260,334 73,177,016
CURRENT LIABILITIES:    
Accounts payable 5,391,519 6,953,710
Accrued compensation and benefits 2,618,752 2,149,973
Other accrued liabilities 1,711,065 1,851,938
Dividends payable 398,210 412,542
TOTAL CURRENT LIABILITIES 10,119,546 11,368,163
LONG TERM LIABILITIES:    
Long-term compensation plans 34,287 16,299
Uncertain tax positions 3,649 106,864
Deferred income taxes   52,998
TOTAL LONG-TERM LIABILITIES 37,936 176,161
COMMITMENTS AND CONTINGENCIES (Footnote 7)
STOCKHOLDERS' EQUITY    
Preferred stock, par value $1.00 per share; 3,000,000 shares authorized; none issued
Common stock, par value $.05 per share; 30,000,000 shares authorized; 8,963,516 and 8,877,379 shares issued and outstanding, respectively 448,176 443,869
Additional paid-in capital 41,894,426 41,279,281
Retained earnings 9,386,374 20,596,203
Accumulated other comprehensive loss (626,124) (686,661)
TOTAL STOCKHOLDERS' EQUITY 51,102,852 61,632,692
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 61,260,334 $ 73,177,016

Condensed Consolidated Balance Sheets (Parenthetical)
v3.8.0.1
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($)
$ in Thousands
Sep. 30, 2017
Dec. 31, 2016
Condensed Consolidated Balance Sheets [Abstract]    
Trade accounts receivable, allowance for doubtful accounts $ 117 $ 77
Preferred stock, par value $ 1.00 $ 1.00
Preferred stock, shares authorized 3,000,000 3,000,000
Preferred stock, shares issued 0 0
Common stock, par value $ 0.05 $ 0.05
Common stock, shares authorized 30,000,000 30,000,000
Common stock, shares issued 8,963,516 8,877,379
Common stock, shares outstanding 8,963,516 8,877,379

Condensed Consolidated Statements Of Loss And Comprehensive Loss
v3.8.0.1
Condensed Consolidated Statements Of Loss And Comprehensive Loss - USD ($)
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Condensed Consolidated Statements Of Loss And Comprehensive Loss [Abstract]        
Sales $ 20,412,439 $ 25,616,640 $ 63,280,980 $ 76,594,526
Cost of sales 17,108,532 18,926,042 48,001,368 55,759,167
Gross profit 3,303,907 6,690,598 15,279,612 20,835,359
Operating expenses:        
Selling, general and administrative expenses 7,161,323 7,866,009 21,516,625 27,550,271
Pension liability adjustment gains       (4,147,836)
Impairment loss     1,617,389  
Restructuring expense 796,231   2,325,861  
Total operating expenses 7,957,554 7,866,009 25,459,875 23,402,435
Operating loss (4,653,647) (1,175,411) (10,180,263) (2,567,076)
Other income (expenses):        
Investment and other income 38,869 19,259 78,888 119,395
Gain (Loss) on sale of assets 26,222 (60,088) (32,024) 748,234
Interest and other expense (42,799) (44,228) (61,839) (94,375)
Foreign currency translation loss       (4,238,497)
Other income (expense), net 22,292 (85,057) (14,975) (3,465,243)
Loss from operations before income taxes (4,631,355) (1,260,468) (10,195,238) (6,032,319)
Income tax (benefit) expense (109,340) 3,301 (67,014) 242,617
Net loss (4,522,015) (1,263,769) (10,128,224) (6,274,936)
Other comprehensive income, net of tax:        
Additional minimum pension liability adjustments       (4,147,836)
Unrealized (loss) gain on available-for-sale securities (240) (2,729) (3,187) 35,575
Foreign currency translation adjustment 31,508 15,465 63,724 4,168,590
Total other comprehensive income 31,268 12,736 60,537 56,329
Comprehensive loss $ (4,490,747) $ (1,251,033) $ (10,067,687) $ (6,218,607)
Basic net loss per share: $ (0.50) $ (0.14) $ (1.13) $ (0.71)
Diluted net loss per share: $ (0.50) $ (0.14) $ (1.13) $ (0.71)
Weighted Average Basic Shares Outstanding 8,960,606 8,849,236 8,934,235 8,816,042
Weighted Average Dilutive Shares Outstanding 8,960,606 8,849,236 8,934,235 8,816,042
Dividends declared per share $ 0.04 $ 0.04 $ 0.12 $ 0.36

Condensed Consolidated Statement Of Changes In Stockholders' Equity
v3.8.0.1
Condensed Consolidated Statement Of Changes In Stockholders' Equity - 9 months ended Sep. 30, 2017 - USD ($)
Common Stock [Member]
Additional Paid-In Capital [Member]
Retained Earnings [Member]
Accumulated Other Comprehensive Loss [Member]
Total
BALANCE at Dec. 31, 2016 $ 443,869 $ 41,279,281 $ 20,596,203 $ (686,661) $ 61,632,692
BALANCE, Shares at Dec. 31, 2016 8,877,379        
Net loss     (10,128,224)   (10,128,224)
Issuance of common stock under Employee Stock Purchase Plan $ 907 79,857     80,764
Issuance of common stock under Employee Stock Purchase Plan, Shares 18,139        
Issuance of common stock to Employee Stock Ownership Plan $ 2,362 216,396     218,758
Issuance of common stock to Employee Stock Ownership Plan, Shares 47,248        
Issuance of common stock under Executive Stock Plan $ 1,128 0     1,128
Issuance of common stock under Executive Stock Plan, Shares 22,555        
Share based compensation   327,261     327,261
Other share retirements, Shares (1,805)        
Other share retirements $ (90) (8,369) 789   (7,670)
Shareholder dividends     (1,082,394)   (1,082,394)
Other comprehensive income       60,537 60,537
BALANCE at Sep. 30, 2017 $ 448,176 $ 41,894,426 $ 9,386,374 $ (626,124) $ 51,102,852
BALANCE, Shares at Sep. 30, 2017 8,963,516        

Condensed Consolidated Statements Of Cash Flows
v3.8.0.1
Condensed Consolidated Statements Of Cash Flows - USD ($)
9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
CASH FLOWS FROM OPERATING ACTIVITIES:    
Net loss $ (10,128,224) $ (6,274,936)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:    
Depreciation and amortization 2,489,661 2,754,189
Share based compensation 327,261 505,306
Deferred taxes (52,998) (11,083)
Impairment loss 1,617,389  
Change in fair value of acquisition-related contingent consideration   (135,316)
Loss (gain) on sale of assets 537,470 (748,234)
Excess tax benefit from share-based payments   63,304
Changes in assets and liabilities:    
Trade accounts receivable 765,055 1,443,908
Inventories 7,232,732 352,653
Prepaid income taxes 789,209 (141,566)
Other assets, net 358,160 (148,010)
Accounts payable (1,648,259) (1,188,066)
Accrued compensation and benefits 701,546 224,713
Other accrued liabilities (157,422) 352,789
Income taxes payable (103,215) (49,657)
Other   58,001
Net cash provided by (used in) operating activities 2,728,365 (2,942,005)
CASH FLOWS FROM INVESTING ACTIVITIES:    
Capital expenditures (389,616) (1,889,283)
Proceeds from the sale of property, plant and equipment 220,366 972,595
Proceeds from the sale of investments 5,076,978 2,014,023
Net cash provided by investing activities 4,907,728 1,097,335
CASH FLOWS FROM FINANCING ACTIVITIES:    
Borrowings on line of credit   4,894,046
Payments against line of credit   (4,894,046)
Cash dividends paid (1,096,726) (4,269,451)
Mortgage principal payments   (103,603)
Proceeds from issuance of common stock, net of shares withheld 74,222 92,191
Excess tax expense benefit from share-based payments   (63,304)
Payment of deferred consideration related to acquisition   (300,000)
Net cash used in financing activities (1,022,504) (4,644,167)
EFFECT OF FOREIGN EXCHANGE RATE CHANGES ON CASH 9,622 (90,510)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 6,623,211 (6,579,347)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 10,443,274 9,812,737
CASH AND CASH EQUIVALENTS AT END OF PERIOD 17,066,485 3,233,390
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:    
Income taxes (refunded) paid (646,660) 443,106
Interest paid 29,297 43,630
Dividends declared not paid 398,210 413,966
Capital expenditures in accounts payable $ 75,525 57,181
Acquisition costs in accrued consideration   $ 6,918

Summary Of Significant Accounting Policies
v3.8.0.1
Summary Of Significant Accounting Policies
9 Months Ended
Sep. 30, 2017
Summary Of Significant Accounting Policies [Abstract]  
Summary Of Significant Accounting Policies

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES



Description of Business



Communications Systems, Inc. (herein collectively called “CSI” or the “Company”) is a Minnesota corporation organized in 1969 that operates primarily as a holding company conducting its business through four business units having operations in the United States and the United Kingdom.

CSI is principally engaged through its Suttle business unit in the manufacture and sale of connectivity infrastructure products for broadband and voice communications and through its Transition Networks business unit in the manufacture of core media conversion products, Ethernet switches, and other connectivity and data transmission products. Through its JDL Technologies business unit the Company provides technology solutions including virtualization, managed services, wired and wireless network design and implementation, HIPAA-compliant IT services, and converged infrastructure configuration and deployment. Through its Net2Edge business unit, the Company enables telecommunications carriers to connect legacy networks to high-speed services.



The Company classifies its businesses into four segments corresponding to the Suttle, Transition Networks, JDL Technologies and Net2Edge business units. Non-allocated general and administrative expenses are separately accounted for as “Other” in the Company’s segment reporting. Intersegment revenues are eliminated upon consolidation.



Financial Statement Presentation



The condensed consolidated balance sheets and condensed consolidated statement of changes in stockholders’ equity as of September 30, 2017 and the related condensed consolidated statements of loss and comprehensive loss, and the condensed consolidated statements of cash flows for the periods ended September 30, 2017 and 2016 have been prepared by Company management.  In the opinion of management, all adjustments (which include only normal recurring adjustments, except where noted) necessary to present fairly the financial position, results of operations, and cash flows at September 30, 2017 and 2016 and for the periods then ended have been made.



Certain information and footnote disclosures normally included in consolidated financial statements prepared in accordance with generally accepted accounting principles in the United States of America have been condensed or omitted.  We recommend these condensed consolidated financial statements be read in conjunction with the financial statements and notes thereto included in the Company’s December 31, 2016 Annual Report to Shareholders on Form 10-K.  The results of operations for the period ended September 30, 2017 are not necessarily indicative of operating results for the entire year.



The presentation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the balance sheet date, and the reported amounts of revenues and expenses during the reporting period.  The estimates and assumptions used in the accompanying condensed consolidated financial statements are based upon management’s evaluation of the relevant facts and circumstances as of the time of the financial statements.  Actual results could differ from those estimates.



Except to the extent updated or described below, the significant accounting policies set forth in Note 1 to the consolidated financial statements in the Company's Annual Report on Form 10-K for the year ended December 31, 2016, appropriately represent, in all material respects, the current status of accounting policies, and are incorporated herein by reference.



Accumulated Other Comprehensive Loss



The components of accumulated other comprehensive loss, net of tax, are as follows:







 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 



 

Foreign Currency Translation

 

Unrealized (loss)/gain on securities

 

Accumulated Other Comprehensive Loss

December 31, 2016

 

$

(704,000)

 

$

17,000 

 

$

(687,000)



 

 

 

 

 

 

 

 

 

Net current period change

 

 

64,000 

 

 

(3,000)

 

 

61,000 



 

 

 

 

 

 

 

 

 

September 30, 2017

 

$

(640,000)

 

$

14,000 

 

$

(626,000)



The Company recognized $4,238,000 in foreign currency translation losses within the statement of loss and comprehensive loss during the first quarter of 2016 due to the substantial liquidation of our Austin Taylor facility in the U.K.  Refer to Note 11 for further information regarding the pension liability adjustment recognized in income in the first quarter of 2016.

 


Summary Of Significant Accounting Policies (Policy)
v3.8.0.1
Summary Of Significant Accounting Policies (Policy)
9 Months Ended
Sep. 30, 2017
Summary Of Significant Accounting Policies [Abstract]  
Description Of Business

Description of Business



Communications Systems, Inc. (herein collectively called “CSI” or the “Company”) is a Minnesota corporation organized in 1969 that operates primarily as a holding company conducting its business through four business units having operations in the United States and the United Kingdom.

CSI is principally engaged through its Suttle business unit in the manufacture and sale of connectivity infrastructure products for broadband and voice communications and through its Transition Networks business unit in the manufacture of core media conversion products, Ethernet switches, and other connectivity and data transmission products. Through its JDL Technologies business unit the Company provides technology solutions including virtualization, managed services, wired and wireless network design and implementation, HIPAA-compliant IT services, and converged infrastructure configuration and deployment. Through its Net2Edge business unit, the Company enables telecommunications carriers to connect legacy networks to high-speed services.



The Company classifies its businesses into four segments corresponding to the Suttle, Transition Networks, JDL Technologies and Net2Edge business units. Non-allocated general and administrative expenses are separately accounted for as “Other” in the Company’s segment reporting. Intersegment revenues are eliminated upon consolidation.

Financial Statement Presentation

Financial Statement Presentation



The condensed consolidated balance sheets and condensed consolidated statement of changes in stockholders’ equity as of September 30, 2017 and the related condensed consolidated statements of loss and comprehensive loss, and the condensed consolidated statements of cash flows for the periods ended September 30, 2017 and 2016 have been prepared by Company management.  In the opinion of management, all adjustments (which include only normal recurring adjustments, except where noted) necessary to present fairly the financial position, results of operations, and cash flows at September 30, 2017 and 2016 and for the periods then ended have been made.



Certain information and footnote disclosures normally included in consolidated financial statements prepared in accordance with generally accepted accounting principles in the United States of America have been condensed or omitted.  We recommend these condensed consolidated financial statements be read in conjunction with the financial statements and notes thereto included in the Company’s December 31, 2016 Annual Report to Shareholders on Form 10-K.  The results of operations for the period ended September 30, 2017 are not necessarily indicative of operating results for the entire year.



The presentation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the balance sheet date, and the reported amounts of revenues and expenses during the reporting period.  The estimates and assumptions used in the accompanying condensed consolidated financial statements are based upon management’s evaluation of the relevant facts and circumstances as of the time of the financial statements.  Actual results could differ from those estimates.



Except to the extent updated or described below, the significant accounting policies set forth in Note 1 to the consolidated financial statements in the Company's Annual Report on Form 10-K for the year ended December 31, 2016, appropriately represent, in all material respects, the current status of accounting policies, and are incorporated herein by reference.

Accumulated Other Comprehensive Loss

Accumulated Other Comprehensive Loss



The components of accumulated other comprehensive loss, net of tax, are as follows:







 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 



 

Foreign Currency Translation

 

Unrealized (loss)/gain on securities

 

Accumulated Other Comprehensive Loss

December 31, 2016

 

$

(704,000)

 

$

17,000 

 

$

(687,000)



 

 

 

 

 

 

 

 

 

Net current period change

 

 

64,000 

 

 

(3,000)

 

 

61,000 



 

 

 

 

 

 

 

 

 

September 30, 2017

 

$

(640,000)

 

$

14,000 

 

$

(626,000)



The Company recognized $4,238,000 in foreign currency translation losses within the statement of loss and comprehensive loss during the first quarter of 2016 due to the substantial liquidation of our Austin Taylor facility in the U.K.  Refer to Note 11 for further information regarding the pension liability adjustment recognized in income in the first quarter of 2016.


Summary Of Significant Accounting Policies (Tables)
v3.8.0.1
Summary Of Significant Accounting Policies (Tables)
9 Months Ended
Sep. 30, 2017
Summary Of Significant Accounting Policies [Abstract]  
Components Of Accumulated Other Comprehensive Loss



 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 



 

Foreign Currency Translation

 

Unrealized (loss)/gain on securities

 

Accumulated Other Comprehensive Loss

December 31, 2016

 

$

(704,000)

 

$

17,000 

 

$

(687,000)



 

 

 

 

 

 

 

 

 

Net current period change

 

 

64,000 

 

 

(3,000)

 

 

61,000 



 

 

 

 

 

 

 

 

 

September 30, 2017

 

$

(640,000)

 

$

14,000 

 

$

(626,000)




Summary Of Significant Accounting Policies (Narrative) (Details)
v3.8.0.1
Summary Of Significant Accounting Policies (Narrative) (Details)
3 Months Ended 9 Months Ended
Mar. 31, 2016
USD ($)
Sep. 30, 2017
segment
Sep. 30, 2016
USD ($)
Summary Of Significant Accounting Policies [Abstract]      
Number of segments | segment   4  
Foreign currency translation loss | $ $ 4,238,000   $ 4,238,497

Summary Of Significant Accounting Policies (Components Of Accumulated Other Comprehensive Loss) (Details)
v3.8.0.1
Summary Of Significant Accounting Policies (Components Of Accumulated Other Comprehensive Loss) (Details)
9 Months Ended
Sep. 30, 2017
USD ($)
Accumulated Other Comprehensive Income (Loss) [Line Items]  
BALANCE $ 61,632,692
BALANCE 51,102,852
Foreign Currency Translation [Member]  
Accumulated Other Comprehensive Income (Loss) [Line Items]  
BALANCE (704,000)
Net current period change 64,000
BALANCE (640,000)
Unrealized (Loss)/Gain On Securities [Member]  
Accumulated Other Comprehensive Income (Loss) [Line Items]  
BALANCE 17,000
Net current period change (3,000)
BALANCE 14,000
Accumulated Other Comprehensive Loss [Member]  
Accumulated Other Comprehensive Income (Loss) [Line Items]  
BALANCE (686,661)
Net current period change 61,000
BALANCE $ (626,124)

Cash Equivalents And Investments
v3.8.0.1
Cash Equivalents And Investments
9 Months Ended
Sep. 30, 2017
Cash Equivalents And Investments [Abstract]  
Cash Equivalents And Investments

NOTE 2 – CASH EQUIVALENTS AND INVESTMENTS



The following tables show the Company’s cash equivalents and available-for-sale securities’ amortized cost, gross unrealized gains, gross unrealized losses and fair value by significant investment category recorded as cash and cash equivalents or short and long term investments as of September 30, 2017 and December 31, 2016:  





 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30, 2017



Amortized Cost

 

Gross Unrealized Gains

 

Gross Unrealized Losses

 

Fair Value

 

Cash Equivalents

 

Short-Term Investments

 

Long-Term Investments



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash equivalents:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Money Market funds

$

8,986,000 

 

$

 -

 

$

 -

 

$

8,986,000 

 

$

8,986,000 

 

$

 -

 

$

 -

Subtotal

 

8,986,000 

 

 

 -

 

 

 -

 

 

8,986,000 

 

 

8,986,000 

 

 

 -

 

 

 -



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Certificates of deposit

 

725,000 

 

 

 -

 

 

 -

 

 

725,000 

 

 

 -

 

 

725,000 

 

 

 -

Subtotal

 

725,000 

 

 

 -

 

 

 -

 

 

725,000 

 

 

 -

 

 

725,000 

 

 

 -



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

$

9,711,000 

 

$

 -

 

$

 -

 

$

9,711,000 

 

$

8,986,000 

 

$

725,000 

 

$

 -













 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2016



Amortized Cost

 

Gross Unrealized Gains

 

Gross Unrealized Losses

 

Fair Value

 

Cash Equivalents

 

Short-Term Investments

 

Long-Term Investments



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash equivalents:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Money Market funds

$

3,851,000 

 

$

 -

 

$

 -

 

$

3,851,000 

 

$

3,851,000 

 

$

 -

 

$

 -

Subtotal

 

3,851,000 

 

 

 -

 

 

 -

 

 

3,851,000 

 

 

3,851,000 

 

 

 -

 

 

 -



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Certificates of deposit

 

4,291,000 

 

 

4,000 

 

 

(1,000)

 

 

4,294,000 

 

 

 -

 

 

4,294,000 

 

 

 -

Corporate Notes/Bonds

 

1,511,000 

 

 

 -

 

 

 -

 

 

1,511,000 

 

 

 -

 

 

1,511,000 

 

 

 -

Subtotal

 

5,802,000 

 

 

4,000 

 

 

(1,000)

 

 

5,805,000 

 

 

 -

 

 

5,805,000 

 

 

 -



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

$

9,653,000 

 

$

4,000 

 

$

(1,000)

 

$

9,656,000 

 

$

3,851,000 

 

$

5,805,000 

 

$

 -



The following table summarizes the estimated fair value of our investments, designated as available-for-sale and classified by the contractual maturity date of the securities as of September 30, 2017:  





 

 

 

 

 

 



 

 

 

 

 

 



 

Amortized Cost

 

Estimated Market Value



 

 

 

 

Due within one year

 

$  

725,000 

 

$

725,000 



The Company did not recognize any gross realized gains or losses during the three and nine month periods ending September 30, 2017 and 2016, respectively. If the Company had realized gains or losses, they would be included within investment and other income in the accompanying condensed consolidated statement of loss and comprehensive loss.  

 


Cash Equivalents And Investments (Tables)
v3.8.0.1
Cash Equivalents And Investments (Tables)
9 Months Ended
Sep. 30, 2017
Cash Equivalents And Investments [Abstract]  
Schedule Of Cash Equivalents And Available-For-Sale Securities



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30, 2017



Amortized Cost

 

Gross Unrealized Gains

 

Gross Unrealized Losses

 

Fair Value

 

Cash Equivalents

 

Short-Term Investments

 

Long-Term Investments



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash equivalents:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Money Market funds

$

8,986,000 

 

$

 -

 

$

 -

 

$

8,986,000 

 

$

8,986,000 

 

$

 -

 

$

 -

Subtotal

 

8,986,000 

 

 

 -

 

 

 -

 

 

8,986,000 

 

 

8,986,000 

 

 

 -

 

 

 -



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Certificates of deposit

 

725,000 

 

 

 -

 

 

 -

 

 

725,000 

 

 

 -

 

 

725,000 

 

 

 -

Subtotal

 

725,000 

 

 

 -

 

 

 -

 

 

725,000 

 

 

 -

 

 

725,000 

 

 

 -



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

$

9,711,000 

 

$

 -

 

$

 -

 

$

9,711,000 

 

$

8,986,000 

 

$

725,000 

 

$

 -













 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2016



Amortized Cost

 

Gross Unrealized Gains

 

Gross Unrealized Losses

 

Fair Value

 

Cash Equivalents

 

Short-Term Investments

 

Long-Term Investments



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash equivalents:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Money Market funds

$

3,851,000 

 

$

 -

 

$

 -

 

$

3,851,000 

 

$

3,851,000 

 

$

 -

 

$

 -

Subtotal

 

3,851,000 

 

 

 -

 

 

 -

 

 

3,851,000 

 

 

3,851,000 

 

 

 -

 

 

 -



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Certificates of deposit

 

4,291,000 

 

 

4,000 

 

 

(1,000)

 

 

4,294,000 

 

 

 -

 

 

4,294,000 

 

 

 -

Corporate Notes/Bonds

 

1,511,000 

 

 

 -

 

 

 -

 

 

1,511,000 

 

 

 -

 

 

1,511,000 

 

 

 -

Subtotal

 

5,802,000 

 

 

4,000 

 

 

(1,000)

 

 

5,805,000 

 

 

 -

 

 

5,805,000 

 

 

 -



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

$

9,653,000 

 

$

4,000 

 

$

(1,000)

 

$

9,656,000 

 

$

3,851,000 

 

$

5,805,000 

 

$

 -



Schedule Of Estimated Fair Value Of Available-For-Sale Securities



 

 

 

 

 

 



 

 

 

 

 

 



 

Amortized Cost

 

Estimated Market Value



 

 

 

 

Due within one year

 

$  

725,000 

 

$

725,000 




Cash Equivalents And Investments (Narrative) (Details)
v3.8.0.1
Cash Equivalents And Investments (Narrative) (Details) - USD ($)
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Cash Equivalents And Investments [Abstract]        
Gross realized gains (losses) $ 0 $ 0 $ 0 $ 0

Cash Equivalents And Investments (Schedule Of Cash Equivalents And Available-For-Sale Securities) (Details)
v3.8.0.1
Cash Equivalents And Investments (Schedule Of Cash Equivalents And Available-For-Sale Securities) (Details) - USD ($)
Sep. 30, 2017
Dec. 31, 2016
Schedule of Available-for-sale Securities [Line Items]    
Amortized Cost $ 9,711,000 $ 9,653,000
Gross Unrealized Gains   4,000
Gross Unrealized Losses   (1,000)
Fair Value 9,711,000 9,656,000
Cash Equivalents 8,986,000 3,851,000
Short-Term Investments 725,112 5,805,276
Cash Equivalents [Member]    
Schedule of Available-for-sale Securities [Line Items]    
Amortized Cost 8,986,000 3,851,000
Fair Value 8,986,000 3,851,000
Cash Equivalents 8,986,000 3,851,000
Cash Equivalents [Member] | Money Market Funds [Member]    
Schedule of Available-for-sale Securities [Line Items]    
Amortized Cost 8,986,000 3,851,000
Fair Value 8,986,000 3,851,000
Cash Equivalents 8,986,000 3,851,000
Investments [Member]    
Schedule of Available-for-sale Securities [Line Items]    
Amortized Cost 725,000 5,802,000
Gross Unrealized Gains   4,000
Gross Unrealized Losses   (1,000)
Fair Value 725,000 5,805,000
Short-Term Investments 725,000 5,805,000
Investments [Member] | Certificates Of Deposit [Member]    
Schedule of Available-for-sale Securities [Line Items]    
Amortized Cost 725,000 4,291,000
Gross Unrealized Gains   4,000
Gross Unrealized Losses   (1,000)
Fair Value 725,000 4,294,000
Short-Term Investments $ 725,000 4,294,000
Investments [Member] | Corporate Notes/Bonds [Member]    
Schedule of Available-for-sale Securities [Line Items]    
Amortized Cost   1,511,000
Fair Value   1,511,000
Short-Term Investments   $ 1,511,000

Cash Equivalents And Investments (Schedule Of Estimated Fair Value Of Available-For-Sale Securities) (Details)
v3.8.0.1
Cash Equivalents And Investments (Schedule Of Estimated Fair Value Of Available-For-Sale Securities) (Details) - Investments [Member]
$ in Thousands
Sep. 30, 2017
USD ($)
Schedule of Available-for-sale Securities [Line Items]  
Amortized Cost, Due within one year $ 725
Estimated Fair Value, Due within one year $ 725

Stock-Based Compensation
v3.8.0.1
Stock-Based Compensation
9 Months Ended
Sep. 30, 2017
Stock-Based Compensation [Abstract]  
Stock-Based Compensation

NOTE 3 - STOCK-BASED COMPENSATION



Employee Stock Purchase Plan



Under the Company’s Employee Stock Purchase Plan (“ESPP”), employees are able to acquire shares of common stock at 85% of the price at the end of each current quarterly plan term.  The most recent term ended September 30, 2017.  The ESPP is considered compensatory under current Internal Revenue Service rules.  At September 30, 2017, after giving effect to the shares issued as of that date, 58,726 shares remain available for purchase under the ESPP.



2011 Executive Incentive Compensation Plan



On March 28, 2011 the Board adopted and on May 19, 2011 the Company’s shareholders approved the Company’s 2011 Executive Incentive Compensation Plan (“2011 Incentive Plan”).  The 2011 Incentive Plan authorizes incentive awards to officers, key employees and non-employee directors in the form of options (incentive and non-qualified), stock appreciation rights, restricted stock, restricted stock units, performance stock units (“deferred stock”), performance cash units, and other awards in stock, cash, or a combination of stock and cash.  The 2011 Incentive Plan, as amended, allows the issuance of up to 2,000,000 shares of common stock. 



During 2017, stock options covering 259,686 shares have been awarded to key executive employees and directors. These options expire seven years from the date of award and generally vest 25% each year beginning one year after the date of award.  The Company also granted deferred stock awards of 100,239 shares to key employees during the first quarter of 2017 under the Company’s long-term incentive plan for performance over the 2017 to 2019 period. The actual number of shares of deferred stock, if any, that are ultimately earned by the respective employees will be determined based on achievement against performance goals at the end of the three-year period ending December 31, 2019 and any shares earned will be issued in the first quarter of 2020 to those key employees still with the Company at that time. 



At September 30, 2017,  160,138 shares have been issued under the 2011 Incentive Plan, 1,292,968 shares are subject to currently outstanding options, deferred stock awards, and unvested restricted stock units, and 546,894 shares are eligible for grant under future awards.





Stock Option Plan for Directors



Shares of common stock are reserved for issuance to non-employee directors under options granted by the Company prior to 2011 under its Stock Option Plan for Non-Employee Directors (the “Director Plan”).  Under the Director Plan nonqualified stock options to acquire shares of common stock were automatically granted to each non-employee director concurrent with annual meetings of shareholders in 2010 and earlier years, with the exercise price of options granted being the fair market value of the common stock on the date of the respective shareholder meetings.  Options granted under the Director Plan expire 10 years from date of grant. No options have been granted under the Director Plan since 2011 when the Company amended the Director Plan to prohibit future option grants.  As of September 30, 2017, there were 51,000 shares subject to outstanding options under the Director Plan.



1992 Stock Plan



Under the Company’s 1992 Stock Plan (“the Stock Plan”), shares of common stock may be issued pursuant to stock options, restricted stock or deferred stock grants to officers and key employees.  Exercise prices of stock options under the Stock Plan cannot be less than fair market value of the stock on the date of grant.  Rules and conditions governing awards of stock options, restricted stock and deferred stock are determined by the Compensation Committee of the Board of Directors, subject to limitations in the Stock PlanThe Company amended the Stock Plan in 2011 to prohibit future equity awards. At September 30, 2017, after reserving for stock options and deferred stock awards granted in prior years and adjusting for forfeitures and issuances during the year, there were 10,230 shares reserved for issuance under the Stock Plan.



Changes in Stock Options Outstanding



The following table summarizes changes in the number of outstanding stock options under the 2011 Incentive Plan, the Director Plan and Stock Plan over the period December 31, 2016 to September 30, 2017:  





 

 

 

 

 

 

 



 

 

 

 

 

 

 



 

 

Weighted average

 

Weighted average



 

 

exercise price

 

remaining



Options

 

per share

 

contractual term

Outstanding – December 31, 2016

922,930 

 

$

 

10.10 

 

4.90 

Awarded

259,686 

 

 

 

4.42 

 

 

Exercised

 -

 

 

 

 -

 

 

Forfeited

(37,199)

 

 

 

11.57 

 

 

Outstanding – September 30, 2017

1,145,417 

 

 

 

8.76 

 

4.74