XML 56 R11.htm IDEA: XBRL DOCUMENT
v3.20.1

FAIR VALUE MEASUREMENTS | 3 Months Ended
--- | ---
Mar. 28, 2020
Fair Value Disclosures [Abstract] |
FAIR VALUE MEASUREMENTS | 4. FAIR VALUE MEASUREMENTS Financial instruments are categorized as Level 1, Level 2 or Level 3 based upon the method by which their fair value is computed. An investment is categorized as Level 1 when its fair value is based on unadjusted quoted prices in active markets for identical assets that the Company has the ability to access at the measurement date. An investment is categorized as Level 2 if its fair market value is based on quoted market prices for similar assets in active markets, quoted prices for identical or similar assets in markets that are not active, based on observable inputs such as interest rates, yield curves, or derived from or corroborated by observable market data by correlation or other means. An investment is categorized as Level 3 if its fair value is based on assumptions developed by the Company about what a market participant would use in pricing the assets. The following table details the fair value measurements of the Company’s financial assets: SCHEDULE OF FAIR VALUE MEASUREMENT OF FINAL INSTRUMENTS
|  |  |  |  | Fair Value Measurement March 28, 2020 Using: |
|  | Total |  |  | Level 1 |  |  | Level 2 |  |  | Level 3 |
Cash and Cash Equivalents |  | $ | 8,333,603 |  |  | $ | 8,333,603 |  |  | $ | - |  |  | $ | - |
U.S. Government Securities |  |  | 3,038,100 |  |  |  | - |  |  |  | 3,038,100 |  |  |  | - |
Corporate Debt |  |  | 6,269,859 |  |  |  | - |  |  |  | 6,269,859 |  |  |  | - |
Equity Investments |  |  | 4,346,642 |  |  |  | 244,194 |  |  |  | - |  |  |  | 4,102,448 |
|  | $ | 21,988,204 |  |  | $ | 8,577,797 |  |  | $ | 9,307,959 |  |  | $ | 4,102,448 |
|  |  |  |  | Fair Value Measurement at December 28, 2019 Using: |
|  | Total |  |  | Level 1 |  |  | Level 2 |  |  | Level 3 |
Cash and Cash Equivalents |  | $ | 6,029,247 |  |  | $ | 6,029,247 |  |  | $ | - |  |  | $ | - |
U.S. Government Securities |  |  | 8,296,870 |  |  |  | - |  |  |  | 8,296,870 |  |  |  | - |
Corporate Debt |  |  | 7,456,127 |  |  |  | - |  |  |  | 7,456,127 |  |  |  | - |
Equity Investments |  |  | 4,537,159 |  |  |  | 386,711 |  |  |  | - |  |  |  | 4,150,448 |
|  | $ | 26,319,403 |  |  | $ | 6,415,958 |  |  | $ | 15,752,997 |  |  | $ | 4,150,448 |
Transfers between levels of the fair value hierarchy are reported at the beginning of the reporting period in which they occur. Changes in Level 3 investments were as follows: SCHEDULE OF FAIR VALUE, ASSETS MEASURED ON RECURRING BASIS, UNOBSERVABLE INPUT RECONCILIATION
|  | December 28, 2019 |  |  | Net unrealized losses |  |  | Purchases, issuances and settlements |  |  | Transfers in and or out of Level 3 |  |  | March 28, 2020 |
Equity Investments |  | $ | 4,537,159 |  |  | $ | (190,517) |  |  | $ | - |  |  | $ | - |  |  | $ | 4,346,642 |
The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate fair value because of their short-term nature. If accrued liabilities were carried at fair value, these would be classified as Level 2 in the fair value hierarchy. Marketable Debt Securities The corporate debt consists of floating rate notes with a maturity that is over multiple years but has interest rates that are reset every three months based on the then-current three-month London Interbank Offering Rate (“three-month Libor”). The Company validates the fair market values of the financial instruments above by using discounted cash flow models, obtaining independent pricing of the securities or through the use of a model that incorporates the three-month Libor, the credit default swap rate of the issuer and the bid and ask price spread of the same or similar investments which are traded on several markets. Equity Investments The Company acquired an equity interest in a company in the first quarter of 2018. The Company made a $1.0 million capital contribution during the three months ended March 31, 2018. The Company also contributed certain intellectual property. During the three months ended March 28, 2020, the Company recorded a $0.1 million unrealized loss on this equity investment due to a fluctuation in the foreign exchange rate. As of March 28, 2020, the Company owned an 11% interest in this investment and the fair value of this equity investment was $3.5 million at March 28, 2020. In 2017 the Company had a warrant to acquire up to 15% of the next round of equity offered by a customer as part of the licensing of technology to the customer. The Company used the pricing and terms of the qualified financing round by the customer in determining the value of its Series A warrant and recorded a gain of $2.0 million. The Company acquired an equity interest in the customer by exercising the Series A warrant into Series A shares in the second quarter of 2018 and recorded a loss of less than $0.1 million. In addition, the Company acquired shares of the customer’s Series B shares valued at $2.5 million based on the fair value of the Series B at the closing in May 2019. During the second quarter of 2019, the Company recognized a $0.8 million gain based on an observable price change for the Series A shares by using the customer’s Series B capital structure, pricing of the shares being offered and the liquidation preference of Series B. In the fourth quarter of 2019 the Company reviewed the financial condition and other factors of the customer and as a result, recorded an impairment charge of $5.2 million to reduce our investment in the customer to zero. On September 30, 2019 the Company entered into an Asset Purchase Agreement (the “Solos Purchase Agreement”) pursuant to which the Company sold and licensed certain assets of our SolosTM (“Solos”) product line and WhisperTM Audio (“Whisper”) technology. As consideration for the transaction the Company received a 20.0% equity stake in Solos Incorporation (“Solos Inc.”). The Company did not have an observable price change for similar investments of its equity investments and recorded no impairment charges on its equity investments during the three months ended March 28, 2020.

X
- References No definition available. + Details
Name: | us-gaap_FairValueDisclosuresAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=117815213&loc=d3e19207-110258 + Details
Name: | us-gaap_FairValueDisclosuresTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration