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OTHER ASSETS AND AMOUNTS DUE TO / FROM AFFILIATES
9 Months Ended
Sep. 24, 2011
OTHER ASSETS AND AMOUNTS DUE TO / FROM AFFILIATES

7. OTHER ASSETS AND AMOUNTS DUE TO / FROM AFFILIATES

Marketable Equity Securities

At September 24, 2011 the Company had an investment in AWSC, with a fair market value of $1.7 million and an adjusted cost basis of $0.7 million, as compared to a fair market value of $4.0 million and an adjusted cost basis of $0.7 million at December 25, 2010. During the second quarter of 2011 the Company sold 300,000 shares of AWSC and recorded a gain of $0.4 million. One of the Company’s directors is a director of AWSC and several directors and officers own amounts ranging from 0.1% to 0.5% of the outstanding stock of AWSC.

During the first quarter of 2010 the Company sold the remainder of its investment in Micrel, Inc. and recorded a gain of $0.7 million.

Non-Marketable Securities—Equity Method Investment

In January 2011, KoBrite issued additional equity and the Company’s ownership percentage was reduced from approximately 19% to approximately 12%. As of September 24, 2011 the carrying value of the investment was $2.5 million. The Company accounts for its interest in KoBrite using the equity method and for the three and nine months ended September 24, 2011 recorded equity losses in unconsolidated affiliates of $0.1 million and $0.2 million respectively, as compared to $0.2 million and $.4 million, respectively, for the three and nine months ended September 25, 2010. One of the Company’s directors is also a member of the Board of Directors of Bright LED, one of the principle investors in KoBrite.

Summarized financial information for KoBrite for the three and nine month periods ended June 25, 2011 and June 25, 2010 is as follows (KoBrite’s results are recorded one quarter in arrears):

 

     Three Months Ended     Nine Months Ended  
     September 24,
2011		     September 25,
2010		     September 24,
2011		     September 25,
2010		  

Revenue

    $ 2,883,000      $ 3,233,000      $ 5,172,000      $ 10,047,000   

Gross margin

      (52,000 )      (452,000 )      (451,000 )      (599,000 ) 

Loss from operations

      (595,000 )      (1,048,000 )      (1,849,000 )      (2,123,000 ) 

Net loss

    $ (423,000 )    $ (963,000 )    $ (1,737,000 )    $ (1,903,000 ) 

Amounts Due from and Due to Affiliates

Related party receivables from AWSC approximated $1.5 million and $2.6 million at September 24, 2011 and December 25, 2010, respectively.

In fiscal year 2008 the Company entered into an agreement wherein it agreed to sell certain of its patents that it was no longer using to a party who would attempt to sub-license the patents. Under the terms of the agreement the amount the Company would receive for the sale of the patents was a percentage of any license fees, after expenses, from the sublicense. In each of the nine months ended September 24, 2011 and September 25, 2010 the Company recorded $0.2 million of gains from the sale of these patents.