KOPIN CORP, 10-K filed on 3/12/2015
Annual Report
Document and Entity Information (USD $)
12 Months Ended
Dec. 27, 2014
Mar. 6, 2015
Jun. 28, 2014
Document Documentand Entity Information [Abstract]
 
 
 
Document Type
10-K 
 
 
Amendment Flag
false 
 
 
Document Period End Date
Dec. 27, 2014 
 
 
Document Fiscal Year Focus
2014 
 
 
Document Fiscal Period Focus
FY 
 
 
Trading Symbol
KOPN 
 
 
Entity Registrant Name
KOPIN CORP 
 
 
Entity Central Index Key
0000771266 
 
 
Current Fiscal Year End Date
--12-27 
 
 
Entity Well-known Seasoned Issuer
No 
 
 
Entity Current Reporting Status
Yes 
 
 
Entity Voluntary Filers
No 
 
 
Entity Filer Category
Accelerated Filer 
 
 
Entity Common Stock, Shares Outstanding
 
65,790,407 
 
Entity Public Float
 
 
$ 219,868,655 
CONSOLIDATED BALANCE SHEETS (USD $)
Dec. 27, 2014
Dec. 28, 2013
Current assets:
 
 
Cash and equivalents
$ 14,635,801 
$ 16,756,666 
Marketable debt securities, at fair value
76,223,135 
95,972,535 
Accounts receivable, net of allowance of $266,000 and $202,000 in 2014 and 2013, respectively
3,758,832 
2,388,461 
Unbilled receivables
43,492 
0 
Inventory
4,081,886 
3,078,055 
Prepaid taxes
378,637 
233,642 
Prepaid expenses and other current assets
802,837 
1,178,643 
Total current assets
99,924,620 
119,608,002 
Property, plant and equipment, net
4,589,421 
6,034,963 
Goodwill
976,451 
1,016,132 
Intangible assets, net
616,759 
1,581,502 
Other assets
1,900,828 
3,024,458 
Accounts and Notes Receivable, Net
14,933,335 
14,866,666 
Total assets
122,941,414 
146,131,723 
Current liabilities:
 
 
Accounts payable
5,503,734 
3,868,865 
Accrued payroll and expenses
1,985,691 
1,436,391 
Accrued warranty
716,000 
716,000 
Billings in excess of revenue earned
586,471 
547,681 
Other accrued liabilities
3,169,028 
3,157,394 
Deferred tax liabilities
1,282,000 
1,512,771 
Total current liabilities
13,242,924 
11,239,102 
Asset retirement obligations
311,187 
329,435 
Commitments and contingencies
   
   
Stockholders’ equity:
 
 
Preferred stock, par value $.01 per share: authorized, 3,000 shares; none issued
0 
0 
Common stock, par value $.01 per share: authorized, 120,000,000 shares; issued 77,731,604 shares in 2014 and 77,567,631 shares in 2013; outstanding 63,077,715 in 2014 and 62,560,946 in 2013, respectively
751,832 
745,935 
Additional paid-in capital
324,625,694 
320,511,458 
Treasury stock (12,102,258 and 12,032,537 shares in 2014 and 2013, respectively, at cost)
(42,741,551)
(42,442,932)
Accumulated other comprehensive income
3,126,239 
3,441,997 
Accumulated deficit
(175,915,255)
(147,703,211)
Total Kopin Corporation stockholders’ equity
109,846,959 
134,553,247 
Noncontrolling interest
(459,656)
9,939 
Total stockholders’ equity
109,387,303 
134,563,186 
Total liabilities and stockholders’ equity
$ 122,941,414 
$ 146,131,723 
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)
Dec. 27, 2014
Dec. 28, 2013
Accounts receivable, allowance
$ 266,000 
$ 202,000 
Preferred stock, par value
$ 0.01 
$ 0.01 
Preferred stock, authorized
3,000 
3,000 
Preferred stock, issued
0 
0 
Common stock, par value
$ 0.01 
$ 0.01 
Common stock, authorized
120,000,000 
120,000,000 
Common stock, issued
77,731,604 
77,567,631 
Common stock, outstanding
63,077,715 
62,560,978 
Treasury stock, shares
12,102,258 
12,032,537 
CONSOLIDATED STATEMENT OF OPERATIONS (USD $)
12 Months Ended
Dec. 27, 2014
Dec. 28, 2013
Dec. 29, 2012
Revenues:
 
 
 
Net component revenues
$ 26,956,741 
$ 20,574,812 
$ 31,298,419 
Research and development revenues
4,850,724 
2,322,897 
3,343,441 
Total revenues
31,807,465 
22,897,709 
34,641,860 
Expenses:
 
 
 
Cost of component revenues
19,638,149 
20,655,216 
22,041,953 
Research and development-funded programs
5,236,791 
1,550,873 
2,178,472 
Research and development-internal
15,499,230 
15,983,147 
12,121,689 
Selling, general and administrative
19,908,020 
19,124,750 
17,165,870 
Goodwill and Intangible Asset Impairment
0 
1,511,414 
1,704,770 
Total expenses
60,282,190 
58,825,400 
55,212,754 
Loss from operations
(28,474,725)
(35,927,691)
(20,570,894)
Other income and expense:
 
 
 
Interest income
966,403 
1,118,617 
1,126,344 
Other income, net
271,537 
235,917 
173,829 
Foreign Currency Transaction Gain (Loss), Unrealized
91,725 
(387,351)
(1,032,588)
Gain on sales of investments
0 
1,899,291 
856,170 
Loss on investment in Intoware
0 
0 
(557,594)
Impairment of equity and cost investments
(1,319,287)
(5,000,442)
0 
Total other income and expense
10,378 
(2,133,968)
566,161 
Loss from continuing operations before benefit (provision) for income taxes, and equity losses in unconsolidated affiliates and net loss of noncontrolling interest
(28,464,347)
(38,061,659)
(20,004,733)
Tax benefit (provision)
180,000 
12,933,209 
(1,099,000)
Loss before equity losses in unconsolidated affiliates and net loss of noncontrolling interest
(28,284,347)
(25,128,450)
(21,103,733)
Equity losses in unconsolidated affiliates
(386,442)
(625,098)
(679,587)
Loss from continuing operations
(28,670,789)
(25,753,548)
(21,783,320)
Income from discontinued operations, net of tax
0 
20,147,532 
2,789,048 
Net loss
(28,670,789)
(5,606,016)
(18,994,272)
Net loss attributable to the noncontrolling interest
458,745 
896,400 
632,342 
Net loss attributable to the controlling interest
(28,212,044)
(4,709,616)
(18,361,930)
Basic:
 
 
 
Continuing operations (in dollars per share)
$ (0.45)
$ (0.40)
$ (0.33)
Discontinued operations (in dollars per share)
$ 0.00 
$ 0.32 
$ 0.04 
Net (loss) income per share (in dollars per share)
$ (0.45)
$ (0.08)
$ (0.29)
Diluted:
 
 
 
Continuing operations (in dollars per share)
$ (0.45)
$ (0.40)
$ (0.33)
Discontinued operations (in dollars per share)
$ 0.00 
$ 0.32 
$ 0.04 
Net (loss) income per share (in dollars per share)
$ (0.45)
$ (0.08)
$ (0.29)
Weighted average number of common shares outstanding:
 
 
 
Basic (in shares)
62,638,675 
62,347,852 
63,617,680 
Diluted (in shares)
62,638,675 
62,347,852 
63,617,680 
Foreign currency translation adjustments
(1,102,859)
231,321 
2,687,344 
Unrealized holding gain (loss) on marketable securities
681,346 
(116,134)
730,967 
Reclassifications of loss in net loss
(6,477)
(1,936,121)
(586,433)
Other comprehensive (loss) income
(427,990)
(1,820,934)
2,831,878 
Comprehensive loss
(29,098,779)
(7,426,950)
(16,162,394)
Comprehensive gain attributable to the noncontrolling interest
570,977 
871,867 
167,232 
Comprehensive loss attributable to the controlling interest
$ (28,527,802)
$ (6,555,083)
$ (15,995,162)
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (USD $)
Total
Common Stock
Additional Paid-in Capital
Treasury Stock
Accumulated Other Comprehensive Income (Loss)
Accumulated Deficit
Total Kopin Corporation Stockholders' Equity
Noncontrolling Interest
Stockholders' Equity, Total [Member]
Beginning Balance at Dec. 31, 2011
 
 
 
 
 
 
 
 
 
Increase (Decrease) in Stockholders' Equity [Roll Forward]
 
 
 
 
 
 
 
 
 
Vesting of restricted stock (in shares)
 
671,568 
 
 
 
 
 
 
 
Vesting of restricted stock
 
$ 6,716 
$ (6,716)
 
 
 
 
 
 
Stock-based compensation expense
3,851,672 
 
3,851,672 
 
 
 
3,851,672 
 
 
Other comprehensive (loss) income
2,831,878 
 
 
 
2,366,768 
 
2,366,768 
465,110 
 
Acquisition of KTC (2010) and Ikanos (2012) and eMDT (2013) equity interest
 
 
 
 
 
 
 
1,384,039 
 
Restricted stock for tax withholding obligations (in shares)
 
(201,182)
 
 
 
 
 
 
 
Restricted stock for tax withholding obligations
(628,634)
(2,013)
(626,621)
 
 
 
(628,634)
 
 
Treasury stock purchase
(3,455,529)
 
 
(3,455,529)
 
 
(3,455,529)
 
 
Net income (loss)
(18,994,272)
 
 
 
 
(18,361,930)
(18,361,930)
(632,342)
 
Ending Balance at Dec. 29, 2012
155,085,910 
736,966 
318,928,495 
(34,450,978)
6,512,792 
(142,993,596)
148,733,679 
6,352,230 
 
Ending Balance (in shares) at Dec. 29, 2012
 
73,696,644 
 
 
 
 
 
 
 
Increase (Decrease) in Stockholders' Equity [Roll Forward]
 
 
 
 
 
 
 
 
 
Vesting of restricted stock (in shares)
 
1,216,900 
 
 
 
 
 
 
 
Vesting of restricted stock
 
12,169 
(12,169)
 
 
 
 
 
 
Stock-based compensation expense
3,804,408 
 
3,804,408 
 
 
 
3,804,408 
 
 
Other comprehensive (loss) income
(1,820,934)
 
 
 
(1,845,466)
 
(1,845,466)
24,532 
 
Other Comprehensive Income Loss Foreign Currency Transaction And Translation Adjustments Before Tax
(4,253,680)
 
 
 
(1,580,629)
 
 
(2,673,051)
 
Acquisition of KTC (2010) and Ikanos (2012) and eMDT (2013) equity interest
200,198 
 
 
 
 
 
 
200,198 
 
Stockholders' Equity Attributable to Noncontrolling Interest
9,939 
 
(1,020,130)
 
355,300 
 
(664,830)
(2,997,570)
(3,662,400)
Restricted stock for tax withholding obligations (in shares)
 
(320,061)
 
 
 
 
 
 
 
Restricted stock for tax withholding obligations
(1,192,346)
(3,200)
(1,189,146)
 
 
 
(1,192,346)
 
 
Treasury stock purchase
(7,991,954)
 
 
(7,991,954)
 
 
(7,991,954)
 
 
Net income (loss)
(5,606,016)
 
 
 
 
(4,709,616)
(4,709,616)
(896,400)
 
Ending Balance at Dec. 28, 2013
134,563,186 
745,935 
320,511,458 
(42,442,932)
3,441,997 
(147,703,211)
134,553,247 
9,939 
 
Ending Balance (in shares) at Dec. 28, 2013
 
74,593,483 
 
 
 
 
 
 
 
Options Outstanding - Aggregate intrinsic value on December 29, 2012
13,000 
 
 
 
 
 
 
 
 
Increase (Decrease) in Stockholders' Equity [Roll Forward]
 
 
 
 
 
 
 
 
 
Exercise of stock options (in shares)
(36,750)
36,750 
 
 
 
 
 
 
 
Exercise of stock options
137,812 
368 
137,445 
 
 
 
137,812 
 
 
Vesting of restricted stock (in shares)
 
843,116 
 
 
 
 
 
 
 
Vesting of restricted stock
 
8,431 
(8,431)
 
 
 
 
 
 
Stock-based compensation expense
5,059,572 
 
5,059,572 
 
 
 
5,059,572 
 
 
Other comprehensive (loss) income
(427,990)
 
 
 
(315,758)
 
 
(112,232)
 
Acquisition of KTC (2010) and Ikanos (2012) and eMDT (2013) equity interest
0 
 
(101,382)
 
 
 
 
101,382 
(101,382)
Stockholders' Equity Attributable to Noncontrolling Interest
(459,656)
 
 
 
 
 
 
 
 
Restricted stock for tax withholding obligations (in shares)
 
(290,142)
 
 
 
 
 
 
 
Restricted stock for tax withholding obligations
(975,869)
(2,901)
(972,968)
 
 
 
(975,869)
 
 
Treasury stock purchase
(298,619)
 
 
(298,619)
 
 
(298,619)
 
 
Net income (loss)
(28,670,789)
 
 
 
 
(28,212,044)
(28,212,044)
(458,745)
 
Ending Balance at Dec. 27, 2014
$ 109,387,303 
$ 751,833 
$ 324,625,694 
$ (42,741,551)
$ 3,126,239 
$ (175,915,255)
$ 109,846,959 
$ (459,656)
 
Ending Balance (in shares) at Dec. 27, 2014
 
75,183,207 
 
 
 
 
 
 
 
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)
12 Months Ended
Dec. 27, 2014
Dec. 28, 2013
Dec. 29, 2012
Cash flows from operating activities:
 
 
 
Net loss
$ (28,670,789)
$ (5,606,016)
$ (18,994,272)
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
 
 
 
Depreciation and amortization
3,002,014 
3,646,725 
9,111,943 
Accretion (amortization) of premium or discount on marketable debt securities
53,437 
360,403 
(287,439)
Stock-based compensation
4,827,772 
4,203,408 
4,486,990 
Net gain on investment transactions
0 
(1,899,291)
(856,170)
Losses in unconsolidated affiliates
102,305 
625,098 
679,587 
Goodwill and Intangible Asset Impairment
0 
1,511,414 
1,704,770 
Gain (Loss) on Sale of Business
0 
(33,452,176)
0 
Gain (Loss) on Disposition of Property Plant Equipment, Excluding Oil and Gas Property and Timber Property
283,333 
0 
0 
Deferred income taxes
(230,725)
252,687 
2,162,246 
Foreign Currency Transaction Gain (Loss), before Tax
(96,819)
341,590 
1,236,194 
Loss on remeasurement of investment in Intoware
0 
0 
557,594 
Asset Impairment Charges
1,319,287 
5,000,442 
0 
Change in allowance for bad debt
63,340 
(107,694)
(129,370)
Change in warranty reserves
489,332 
733,428 
402,938 
Changes in assets and liabilities:
 
 
 
Accounts receivable
(1,286,407)
4,853,073 
4,363,447 
Inventory
(1,520,824)
2,262,547 
3,466,568 
Prepaid expenses and other current assets
191,367 
(179,858)
126,580 
Accounts payable and accrued expenses
1,829,591 
(773,471)
(2,996,339)
Billings in excess of revenue earned
38,790 
(672,714)
(1,247,066)
Net cash (used in) provided by operating activities
(19,604,996)
(18,900,405)
3,788,201 
Cash flows from investing activities:
 
 
 
Proceeds from sale of marketable debt securities
39,801,276 
17,130,488 
37,305,871 
Purchase of marketable debt securities
(19,867,896)
(49,329,891)
(39,853,837)
Proceeds from Divestiture of Businesses, Net of Cash Divested
0 
55,188,020 
0 
Cash included in current assets held for sale
0 
0 
(2,388,812)
Purchases of cost based investment
0 
(3,583,611)
(2,249,784)
Proceeds from sale of investments
0 
2,597,289 
856,170 
Other assets
(38,134)
(10,552)
43,564 
Proceeds from Sale of Machinery and Equipment
250,000 
0 
0 
Capital expenditures
(1,489,986)
(741,543)
(9,831,967)
Net cash provided by (used in) investing activities
18,655,260 
21,461,684 
(15,930,572)
Cash flows from financing activities:
 
 
 
Treasury stock purchases
(298,619)
(7,991,954)
(3,455,529)
Purchase of noncontrolling interest in Kowon
0 
 
0 
Payments to Noncontrolling Interests
 
(3,662,400)
 
Settlements of restricted stock for tax withholding obligations
(975,869)
(1,192,346)
(628,634)
Proceeds from exercise of stock options
137,813 
0 
0 
Net cash used in financing activities
(1,136,675)
(12,846,700)
(4,084,163)
Effect of exchange rate changes on cash
(34,454)
(93,300)
266,758 
Net decrease in cash and equivalents
(2,120,865)
(10,378,721)
(15,959,776)
Cash and equivalents:
 
 
 
Beginning of year
16,756,666 
27,135,387 
43,095,163 
End of year
14,635,801 
16,756,666 
27,135,387 
Supplemental disclosure of cash flow information:
 
 
 
Income taxes paid
 
95,000 
75,000 
Supplemental schedule of noncash investing activities:
 
 
 
Income Taxes Paid, Net
(18,000)
 
 
Construction in progress included in accrued expenses
373,000 
105,000 
360,000 
Notes Receivable, Fair Value Disclosure
0 
14,866,000 
0 
Intoware
 
 
 
Cash flows from investing activities:
 
 
 
Cash paid to acquire Intoware and FDD, net of cash acquired
0 
0 
188,223 
eMDT
 
 
 
Cash flows from investing activities:
 
 
 
Payments to Acquire Business Three, Net of Cash Acquired
$ 0 
$ 211,484 
$ 0 
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies
 Summary of Significant Accounting Policies
The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America 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 date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Fiscal Year
The Company’s fiscal year ends on the last Saturday in December. The fiscal years ended December 27, 2014, December 28, 2013 and December 29, 2012 include 52 weeks, and are referred to as fiscal years 2014, 2013 and 2012, respectively, herein.
Principles of Consolidation
The consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries, a majority owned 93% subsidiary, Kowon Technology Co., Ltd. (Kowon), located in Korea, a majority owned 58% subsidiary, Intoware Ltd. (Intoware), located in the United Kingdom, (formerly known as Ikanos Consulting Limited) and a majority owned 80% subsidiary, eMDT America Inc (eMDT), located in California (collectively the Company). All intercompany transactions and balances have been eliminated. Amounts of Kowon, Intoware and eMDT not attributable to the Company are referred to as noncontrolling interests in the consolidated statements of operations and consolidated statements of comprehensive loss. Investments in business entities in which the Company does not have control but has the ability to exercise significant influence over operating and financial policies are accounted for by the equity method.
In 2013, the Company paid approximately $3.7 million to acquire an additional 15% ownership in its Kowon subsidiary which raised its ownership from 78% to 93%. The Company ceased its production activities at its Kowon facility in 2013 but as of December 27, 2014, the closure of this facility did not meet the criteria for assets held for sale.
Revenue Recognition
The Company recognizes revenue if four basic criteria have been met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred and services rendered; (3) the price to the buyer is fixed or determinable; and (4) collectability is reasonably assured. The Company does not recognize revenue for products prior to customer acceptance unless it believes the product meets all customer specifications and the Company has a history of consistently achieving customer acceptance of the product. Provisions for product returns and allowances are recorded in the same period as the related revenues. The Company analyzes historical returns, current economic trends and changes in customer demand and acceptance of product when evaluating the adequacy of sales returns and other allowances. Certain product sales are made to distributors under agreements allowing for a limited right of return on unsold products. Sales to distributors are primarily made for sales to the distributors' customers and not for their stocking of inventory. The Company delays revenue recognition for its estimate of distributor claims of right of return on unsold products based upon its historical experience with the Company’s products and specific analysis of amounts subject to return based upon discussions with the Company’s distributors or their customers.
The Company recognizes revenues from long-term research and development contracts on the percentage-of-completion method of accounting as work is performed, based upon the ratio of costs or hours already incurred to the estimated total cost of completion or hours of work to be performed. Revenue recognized at any point in time is limited to the amount funded by the U.S. government or contracting entity. The Company accounts for product development and research contracts that have established prices for distinct phases as if each phase were a separate contract. In some instances, the Company is contracted to create a deliverable which is anticipated to be qualified and go into full rate production stages. In those cases, the revenue recognition methodology will change from the percentage of completion method to the units-of-delivery method as new contracts are received after formal qualification has been completed. Under certain of its research and development contracts, the Company recognizes revenue on a milestone methodology.  This revenue is recognized when the Company achieves specified milestones based on its past performance.
 
The Company classifies amounts earned on contracts in progress that are in excess of amounts billed as unbilled receivables and classifies amounts received in excess of amounts earned as billings in excess of revenues earned. The Company invoices based on dates specified in the related agreement or in periodic installments based upon its invoicing cycle. The Company recognizes the entire amount of an estimated ultimate loss in its financial statements at the time the loss on a contract becomes known.
Research and Development Costs
Research and development expenses are incurred in support of internal display product development programs or programs funded by agencies or prime contractors of the U.S. government and commercial partners. Research and development costs include staffing, purchases of materials and laboratory supplies, circuit design costs, fabrication and packaging of experimental display products, and overhead, and are expensed immediately.
Cash and Equivalents and Marketable Securities
The Company considers all highly liquid, short-term debt instruments with original maturities of three months or less to be cash equivalents.
Marketable debt securities consist primarily of commercial paper, medium-term corporate notes, and United States government and agency backed securities. The Company classifies these marketable debt securities as available-for-sale at fair value in “Marketable debt securities, at fair value.” The investments in Vuzix Corporation (Vuzix) and GCS Holdings are included in "Other Assets" as available-for-sale and at fair value. The Company records the amortization of premium and accretion of discounts on marketable debt securities in the results of operations.
The Company uses the specific identification method as a basis for determining cost and calculating realized gains and losses with respect to marketable debt securities. The gross gains and losses realized related to sales of marketable debt securities were not material during fiscal years 2014, 2013 and 2012.
Inventory
Inventory is stated at the lower of cost (determined on the first-in, first-out method) or market and consists of the following at December 27, 2014 and December 28, 2013:
 
2014
 
2013
Raw materials
$
2,057,202

 
$
1,441,569

Work-in-process
1,551,799

 
1,003,540

Finished goods
472,885

 
632,946

 
$
4,081,886

 
$
3,078,055


Property, plant and equipment
Property, plant and equipment are recorded at cost. Depreciation and amortization are provided using the straight-line method over the estimated useful lives of the assets, generally 3 to 10 years. Leasehold improvements and leased equipment are amortized over the shorter of the term of the lease or the useful life of the improvement or equipment. As discussed below, obligations for asset retirement are accrued at the time property, plant and equipment is initially purchased or as such obligations are generated from use.

Intangible assets

At December 27, 2014 intangible assets consisted of patents. At December 28, 2013, intangible assets include patents, customer relationships, developed technology and trademarks. Customer relationships represent the fair value of the underlying relationships with customers. Developed technology represents the fair value of technology as it exists in current products and has value through its continued use or reuse. The trademark represents the brand and name recognition associated with the marketing of products and was determined to have a finite life.
Identifiable intangible assets are amortized using the straight-line method over the estimated useful lives of the assets, generally three to seven years.

Product Warranty
The Company generally sells products with a limited warranty of product quality and a limited indemnification of customers against intellectual property infringement claims related to the Company’s products. The Company accrues for known warranty and indemnification issues if a loss is probable and can be reasonably estimated, and accrues for estimated incurred but unidentified issues based on historical activity. As of December 27, 2014 and December 28, 2013, the Company had warranty reserves of $0.7 million. For the fiscal years 2014, 2013 and 2012 warranty claims and reversals were approximately $0.4 million, $0.8 million and $2.2 million, respectively.
Asset Retirement Obligations
The Company recorded asset retirement obligations (ARO) liabilities of $0.3 million at December 27, 2014 and December 28, 2013, respectively. This represents the legal obligations associated with retirement of the Company’s assets when the timing and/or method of settling the obligation are conditional on a future event that may or may not be within the control of the Company.
 
2014
 
2013
Beginning balance
$
329,435

 
$
322,477

Additions
—

 
—

Charges
—

 
—

Accretion and exchange rate change
(18,248
)
 
6,958

Ending balance
$
311,187

 
$
329,435


Income Taxes
The consolidated financial statements reflect provisions for federal, state, local and foreign income taxes. The Company recognizes deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis, as well as operating loss and tax credit carryforwards. The Company measures deferred tax assets and liabilities using enacted tax rates expected to apply to taxable income in the years in which those temporary differences and carryforwards are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company provides valuation allowances if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

Foreign Currency
Assets and liabilities of non-U.S. operations where the functional currency is other than the U.S. dollar are translated from the functional currency into U.S. dollars at year end exchange rates, and revenues and expenses at average rates prevailing during the year. Resulting translation adjustments are accumulated as part of accumulated other comprehensive income. Transaction gains or losses are recognized in income or loss in the period in which they occur.
Net (Loss) Income Per Share
Basic net (loss) income per share is computed using the weighted-average number of shares of common stock outstanding during the period less any unvested restricted shares. Diluted earnings per common share is calculated using weighted-average shares outstanding and contingently issuable shares, less weighted-average shares reacquired during the period. The net outstanding shares are adjusted for the dilutive effect of shares issuable upon the assumed conversion of the Company’s common stock equivalents, which consist of outstanding stock options and unvested restricted stock.
Weighted-average common shares outstanding used to calculate earnings per share, is as follows:
 
 
2014
 
2013
 
2012
Weighted-average common shares outstanding—basic
62,638,675

 
62,347,852

 
63,617,680

Stock options and nonvested restricted common stock
—

 
—

 
—

Weighted-average common shares outstanding—diluted
62,638,675

 
62,347,852

 
63,617,680


The following were not included in weighted-average common shares outstanding- diluted because they are anti-dilutive or performance conditions have not been met at the end of the period.
 
 
2014
 
2013
 
2012
Nonvested restricted common stock
2,551,631

 
3,024,148

 
2,283,048

Stock options
130,500

 
558,850

 
983,680

Total
2,682,131

 
3,582,998

 
3,266,728


    
Not included in weighted average common shares outstanding-diluted are the warrants to purchase 200,000 shares of the
Company’s common stock for $3.49 per share.
Concentration of Credit Risk
Financial instruments that potentially subject the Company to concentration of credit risk other than marketable securities consist principally of trade accounts receivable and the note receivable from IQE, plc. Trade receivables are primarily derived from sales to manufacturers of consumer electronic devices and wireless components or military applications.
The Company primarily invests its excess cash in government backed and corporate financial instruments that management believes to be of high credit worthiness, which bear lower levels of relative credit risk. The Company relies on rating agencies to ascertain the credit worthiness of its marketable securities and, where applicable, guarantees by the Federal Deposit Insurance Company. The Company sells its products to customers worldwide and generally does not require collateral. The Company maintains a reserve for potential credit losses.
Fair Value of Financial Instruments
Financial instruments consist of current assets (except inventories, income tax receivables and prepaid assets) and certain current liabilities. Current assets (excluding marketable securities which are recorded at fair value) and current liabilities are carried at cost, which approximates fair value.
Stock-Based Compensation
The fair value of stock option awards is estimated on the date of grant using the Black-Scholes-Merton option-pricing model. There were no stock options granted in fiscal years 2014, 2013 or 2012.
 
The fair value of nonvested restricted common stock awards is generally the market value of the Company’s equity shares on the date of grant. The nonvested restricted common stock awards require the employee to fulfill certain obligations, including remaining employed by the Company for one, two or four years (the vesting period) and in certain cases also require meeting either performance criteria or the Company’s stock achieving a certain price. The performance criteria primarily consist of the achievement of established milestones. For nonvested restricted common stock awards which solely require the recipient to remain employed with the Company, the stock compensation expense is amortized over the anticipated service period. For nonvested restricted common stock awards which require the achievement of performance criteria, the Company reviews the probability of achieving the performance goals on a periodic basis. If the Company determines that it is probable that the performance criteria will be achieved, the amount of compensation cost derived for the performance goal is amortized over the service period. If the performance criteria are not met, no compensation cost is recognized and any previously recognized compensation cost is reversed. The Company recognizes compensation costs on a straight-line basis over the requisite service period for time vested awards.

In 2013, the Company granted compensation awards to its Chief Executive Officer that consisted of two grants of 150,000 shares of restricted stock each. One of the grants will vest at the end of the first 10 consecutive trading day period following the grant date during which the Company’s common stock trades at a price per share equal to or greater than $6.00. The other award will vest at the end of the first 10 consecutive trading day period following the grant date during which the Company’s common stock trades at a price per share equal to or greater than $7.00. In 2012, the Company granted compensation awards to its Chief Executive Officer that consisted of a grant of 260,000 shares of restricted stock and a grant of 380,000 shares of phantom stock to be settled in cash. The 260,000 shares of restricted stock and the 380,000 shares of phantom stock will vest at the end of the first 10 consecutive trading day period following the grant date during which the Company’s common stock trades at a price per share equal to or greater than $5.25, prior to September 12, 2016. The vesting of the awards upon achieving a closing stock price of $6.00, $7.00 and $5.25 for 10 consecutive days is considered a market condition. The accounting for the 150,000, 150,000 and 260,000 shares requires the fair market value of the shares to be determined on the grant day and then this fair market value is expensed straight-line over the derived service period. The accounting for the phantom stock award requires the Company to periodically assess the fair market value of the award, with increases or decreases in the fair market value being reflected in the statements of operations.

In 2013, the Company granted a compensation award to its Chief Executive Officer that consisted of a grant of 300,000 shares of restricted stock that will vest upon the Company shipping 50,000 units of a new display. The compensation cost of this award will be recognized over the period the Company ships the displays. As of December 27, 2014, these awards were not yet earned and no compensation expense has been recorded.
Comprehensive Loss
Comprehensive loss is the total of net (loss) income and all other non-owner changes in equity including such items as unrealized holding (losses) gains on marketable equity and debt securities classified as available-for-sale and foreign currency translation adjustments.

The components of accumulated other comprehensive income are as follows:
 
Cumulative
Translation
Adjustment
 
Unrealized Holding
 Gain (Loss) on
Marketable
Securities
 
Accumulated Other
Comprehensive
Income
Balance as of December 31, 2011
$
1,319,870

 
$
2,826,154

 
$
4,146,024

Changes during year
2,222,234

 
144,534

 
2,366,768

Balance as of December 29, 2012
3,542,104

 
2,970,688

 
6,512,792

Changes during year
(1,017,403
)
 
(2,053,392
)
 
(3,070,795
)
Balance as of December 28, 2013
2,524,701

 
917,296

 
3,441,997

Changes during year
(990,626
)
 
674,868

 
(315,758
)
Balance as of December 27, 2014
$
1,534,075

 
$
1,592,164

 
$
3,126,239



Impairment of Long-Lived Assets
The Company periodically reviews the carrying value of its long-lived assets to determine if facts and circumstances suggest that they may be impaired or that the amortization or depreciation period may need to be changed. The carrying value of a long-lived asset is considered impaired when the anticipated identifiable undiscounted cash flows from such asset are less than its carrying value. For assets that are to be held and used, impairment is measured based upon the amount by which the carrying amount of the asset exceeds its fair value. The carrying value of the Company’s long-lived assets was $4.6 million at December 27, 2014.
Recently Issued Accounting Pronouncements
In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers (Topic 606). The reporting standard requires the Company to identify the performance obligations in a contract, determine the transaction price, allocate the transaction price to each of the obligations and then recognizes the transaction price as the obligations are fulfilled. The standard also requires certain new disclosures. The standard is effective for annual and interim reporting periods beginning after December 15, 2016. The Company is currently assessing the potential impact of the adoption of ASU 2014-09 on its consolidated financial statements.
Statement of Comprehensive Income

During the twelve months ended December 27, 2014, the change in the Company's accumulated other comprehensive income was the net of $(1.1) million cumulative translation adjustment and $0.7 million unrealized holding gains on marketable securities.
Discontinued Operations
Discontinued Operations
Discontinued Operations
On January 16, 2013, (the Closing Date), the Company sold its III-V product line, including all of the outstanding equity interest in KTC Wireless, LLC (KTC), a wholly owned subsidiary of the Company, to IQE KC, LLC (IQE) and IQE plc (Parent, and collectively with IQE, the Buyer) pursuant to a Purchase Agreement (the Purchase Agreement) entered into on January 10, 2013 for an aggregate purchase price of approximately $75 million, subject to certain adjustments, including working capital adjustments and escrow (the Sale). After adjustments for working capital items the final purchase price was $70.2 million of which $55.2 million was paid to the Company in 2013 and the remaining $15 million will be paid to the Company on the third anniversary of the Closing Date. Payment of the $15 million was recorded at its estimated discount value of $14.8 million and is secured by liens on certain assets of the business sold.
The operating results of the III-V product line prior to the Sale are reported within Income from discontinued operations, net of tax, in the consolidated statement of operations and have been excluded from segment results.
The following table summarizes the results from discontinued operations:
 
 
 
December 28, 2013
 
December 29, 2012
Net product and research and development revenues
$
2.3

 
$
58.8

(Loss) gain from discontinued operations before income taxes
(0.2
)
 
4.5

(Provision) benefit for income taxes on discontinued operations
—

 
(1.7
)
Discontinued operations, net of tax
(0.2
)
 
2.8

Gain on sale, net of $13.1 million of tax
20.4

 
—

Income from discontinued operations, net of tax
$
20.2

 
$
2.8

Property, Plant and Equipment
Property, Plant and Equipment
Property, Plant and Equipment
Property, plant and equipment consisted of the following at December 27, 2014 and December 28, 2013:
 
 
Useful Life
 
2014
 
2013
Land
 
 
$
877,485

 
$
915,595

Buildings
10 years
 
2,298,367

 
2,398,188

Equipment
3-5 years
 
19,696,919

 
20,993,220

Leasehold improvements
Life of the lease
 
3,652,395

 
3,441,553

Furniture and fixtures
3 years
 
886,985

 
910,270

Equipment under construction
 
 
657,142

 
623,503

 
 
 
28,069,293

 
29,282,329

Accumulated depreciation and amortization
 
 
(23,479,872
)
 
(23,247,366
)
Net property, plant and equipment
 
 
$
4,589,421

 
$
6,034,963


There were no material gains or losses on disposals of long-lived assets in fiscal years 2014, 2013 and 2012. Depreciation expense for the fiscal years 2014, 2013 and 2012 was approximately $2.6 million, $2.4 million and $3.5 million, respectively.
Other Assets and Amounts Due to / Due From Affiliates
Other Assets and Amounts Due To / Due From Affiliates
Other Assets and Note Receivable
Other assets consist of the following as of December 27, 2014 and December 28, 2013:
 
 
2014
 
2013
Marketable Equity Securities
 
 
 
        Vuzix Corporation
$
1,500,777

 
$
1,433,102

 GCS Holdings
180,347

 
—

Non-Marketable Securities—Equity Method Investments
 
 
 
 KoBrite
—

 
1,421,592

Other
219,704

 
169,764

Total Other Assets
$
1,900,828

 
$
3,024,458


Marketable Equity Securities
As of December 27, 2014, the Company had an investment in Vuzix Corporation and GCS Holdings which had a fair market values of $1.5 million and $0.2 million, respectively and adjusted cost basis of $0.0 million and $0.0 million, respectively.
Non-Marketable Securities—Equity Method Investments
Equity losses in unconsolidated affiliates recorded in the consolidated statement of operations are as follows:
 
 
2014
 
2013
 
2012
KoBrite
$
(102,305
)
 
$
(406,811
)
 
$
(573,265
)
Intoware
—

 
—

 
(106,322
)
Ask Ziggy
$
(284,137
)
 
$
(218,287
)
 
$
—

Total
$
(386,442
)
 
$
(625,098
)
 
$
(679,587
)

In the second quarter of 2014 the Company wrote-off its $1.3 million investment in KoBrite. Prior to the write-off, the Company accounted for its 12% ownership interest in Kobrite using the equity method. One of the Company’s directors is a member of the Board of Directors of Bright LED, principal investor of KoBrite.
During the three months ended March 31, 2012, the Company acquired a 25% interest in Intoware Limited, a private company, for $0.7 million. On July 10, 2012, the Company invested an additional $2.5 million in Intoware and in 2013 Intoware repurchased stock from an employee. These transactions increased the Company’s interest in Intoware to 58%. For the six month period ended June 30, 2012, the Company recorded the results of operations of Intoware on the equity method of accounting and commencing in the third quarter of 2012 the Company consolidated Intoware.
The Company invested $1.0 million and $1.6 million in 2012 and 2013, respectively, in a private company Ask Ziggy (AZ). At December 28, 2013, the Company determined that the AZ investment was impaired and wrote the investment down to $0. The Company continued to fund AZ during the year ended December 27, 2014.
Summarized financial information for 2012 includes Kobrite for the period ended September 30, 2012 (Kobrite's results are recorded one quarter in arrears) and Intoware's operating results for the six month period January 1, 2012 through June 30, 2012. Summarized financial information for 2013 includes Kobrite for the year ended September 30, 2013 and AZ for the five month period August 1, 2013 through December 28, 2013. As of December 27, 2014, the Company no longer has any equity-method investments with value in the financial statements.
 
 
2013
 
2012
Current assets
$
7,769,000

 
$
9,581,000

Noncurrent assets
10,663,000

 
12,701,000

Current liabilities
1,207,000

 
1,215,000

Revenues
5,085,000

 
6,010,000

Margin loss
(2,501,000
)
 
(2,732,000
)
Loss from operations
(6,114,000
)
 
(4,938,000
)
Net loss
(5,526,000
)
 
(5,308,000
)

 
The Company has a loan to a non-officer employee for approximately $140,000 at December 27, 2014, which is currently due.
During the first quarter of 2013, the Company acquired four patents for $1.8 million and hired the patents' inventor. Upon commencement of employment the Company issued to the employee 400,000 shares of the Company's common stock, of which 100,000 shares were immediately vested and 300,000 shares were to vest upon the achievement of certain milestones.
During the twelve months ended December 28, 2013, the Company recorded impairment charges of $2.5 million related to the write-off of a cost based investment.

The Company has a $15.0 million note receivable as a result of the sale of its III-V product line and investment in KTC which is due January 16, 2016. The note receivable is carried on the Company’s financial statements at a discount amount of $14.9 million on December 27, 2014. The note receivable is collateralized by certain assets of the buyer of III-V product line. The buyer has outstanding debt and the repayment of the note receivable is subject to the buyer remaining within its debt compliance obligations at the time of repayment.
Business Combinations
Business Combinations
Business Combinations

eMDT
In April 2013, the Company acquired 51% of the outstanding stock of eMDT, a private company, for $400,000. In connection with the acquisition, the Company allocated excess purchase price in the amount of approximately $400,000 to goodwill.  During the second quarter of 2014, the Company paid approximately $0.3 million to acquire an additional 29% ownership in its eMDT subsidiary increasing its ownership percentage to 80%. As of December 27, 2014, the Company has an option to acquire the remaining equity of the Company for $200,000.

The results of operations of the eMDT acquisition have been included in the consolidated statements of operations from the time the Company assumed majority ownership, approximately April 17, 2013. eMDT's net loss from operations included in the consolidated results of operation for the year ended December 28, 2013 was $0.3 million. The transaction related costs associated with the eMDT acquisition were considered immaterial and are included within selling, general and administrative expense for the fiscal year ended December 28, 2013. The goodwill will not be deductible for tax purposes.
Financial Instruments
Financial Instruments
Financial Instruments
Fair Value Measurements
Under accounting guidance, 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 Company’s investments are either held by brokers or in the case of publicly-held corporation, by the Company. The brokers who hold the Company’s investments provide periodic reporting on both the cost and fair value of the securities. The Company performs various procedures to corroborate the fair value provided by the brokers. Debt securities reflected in the table below include investments such as certificates of deposit, commercial paper, corporate bonds, government bonds, and money market fund deposits. When the Company uses observable market prices for identical securities that are traded in less active markets, its debt investments are classified as Level 2. When observable market prices for identical securities are not available, the Company prices our debt investments using non-binding market consensus prices that are corroborated with observable market data; quoted market prices for similar instruments; or pricing models, such as a discounted cash flow model, with all significant inputs derived from or corroborated with observable market data. Non-binding market consensus prices are based on quotes from brokers. The discounted cash flow model uses observable market inputs, such as US treasury-based yield curves.
 
The following table details the fair value measurements within the fair value hierarchy of the Company’s financial assets:
 
 
 
 
Fair Value Measurement at December 27, 2014 Using:
 
Total
 
Level 1        
 
Level 2        
 
Level 3        
Money Markets and Cash Equivalents
$
14,635,802

 
$
14,635,802

 
$
—

 
$
—

U.S. Government Securities
57,697,142

 
21,218,340

 
36,478,802

 
—

Corporate Debt
5,970,983

 
—

 
5,970,983

 
—

Certificates of Deposit
12,555,010

 
—

 
12,555,010

 
—

Vuzix Corporation
1,500,777

 
1,500,777

 
—

 
—

GCS Holdings
180,347

 
180,347

 
—

 
—

 
$
92,540,061

 
$
37,535,266

 
$
55,004,795

 
$
—

 
 
 
 
Fair Value Measurement at December 28, 2013 Using:
 
Total
 
Level 1        
 
Level 2        
 
Level 3        
Money Markets and Cash Equivalents
$
16,756,666

 
$
16,756,666

 
$
—

 
$
—

U.S. Government Securities
68,284,392

 
16,542,003

 
51,742,389

 
—

Corporate Debt
12,984,331

 
—

 
12,984,331

 
—

Certificates of Deposit
14,703,812

 
—

 
14,703,812

 
—

Vuzix Corporation
1,433,102

 
1,433,102

 
—

 
—

 
$
114,162,303

 
$
34,731,771

 
$
79,430,532

 
$
—


The corporate debt consists of floating rate notes with a maturity that is over multiple years but has interest rates which are reset every three months based on the then current three month London Interbank Offering Rate (3 month Libor). The Company determines the fair market values of these corporate debt instruments through the use of a model which incorporates the 3 month Libor, the credit default swap rate of the issuer and the bid and ask price spread of same or similar investments which are traded on several markets.
The carrying amounts of cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate fair value because of their short term nature. The carrying amount of accrued liabilities is classified as Level 2 in the fair value hierarchy.
Marketable Debt Securities
Investments in available-for-sale marketable debt securities are as follows at December 27, 2014 and December 28, 2013:
 
 
 
Amortized Cost
 
Unrealized Gains
 
Unrealized Losses
 
Fair Value
 
2014
 
2013
 
2014
 
2013
 
2014
 
2013
 
2014
 
2013
U.S. government and agency backed securities
$
57,897,914

 
$
68,970,505

 
$
—

 
$
—

 
$
(200,772
)
 
$
(686,113
)
 
$
57,697,142

 
$
68,284,392

Corporate debt and certificates of deposits
18,564,823

 
27,767,513

 
—

 
—

 
(38,830
)
 
(79,370
)
 
18,525,993

 
27,688,143

Total
$
76,462,737

 
$
96,738,018

 
$
—

 
$
—

 
$
(239,602
)
 
$
(765,483
)
 
$
76,223,135

 
$
95,972,535


 
The contractual maturity of the Company’s marketable debt securities is as follows at December 27, 2014:
 
 
Less than
One year
 
One to
Five years
 
Greater than
Five years
 
Total
U.S. government and agency backed securities
$
14,618,790

 
$
35,548,345

 
$
7,530,007

 
$
57,697,142

Corporate debt and certificates of deposits
15,883,913

 
1,680,830

 
961,250

 
18,525,993

Total
$
30,502,703

 
$
37,229,175

 
$
8,491,257

 
$
76,223,135


Other-than-Temporary Impairments
The Company reviews its marketable debt securities on a quarterly basis for the presence of other-than-temporary impairment (OTTI).
If the Company determines that an OTTI has occurred it further estimates the amount of OTTI resulting from a decline in the credit worthiness of the issuer (credit-related OTTI) and the amount of non credit-related OTTI. Noncredit-related OTTI can be caused by such factors as market illiquidity. Credit-related OTTI is recognized in earnings while noncredit-related OTTI on securities not expected to be sold is recognized in other comprehensive income (OCI). The Company did not record any OTTI for the fiscal years 2014, 2013 and 2012.
Stockholders' Equity and Stock-Based Compensation
Stockholders' Equity and Stock-Based Compensation
Stockholders’ Equity and Stock-Based Compensation
In March 2013, the Company’s Board of Directors authorized the repurchase of up to $30 million of the Company’s common stock in open market or negotiated transactions through March 2014. Since the plan’s inception through December 27, 2014, the Company has purchased 2,241,121 shares of its common stock for $8,290,573.
The Company has stock-based awards outstanding under two plans. In 2001, the Company adopted a 2001 Equity Incentive Plan (the Equity Plan). The Equity Plan authorized 7,100,000 shares of common stock, to be issued to employees, non-employees, and members of the Board of Directors (the Board). The Equity Plan had a ten year life and therefore no new equity awards may be issued under this plan. In 2010, the Company adopted a 2010 Equity Incentive Plan (the 2010 Equity Plan) which authorized the issuance of shares of common stock to employees, non-employees, and the Board. The 2010 Equity Plan has been subsequently amended to increase the number of authorized shares. The number of shares authorized is 500,000 plus the number of shares of common stock which were available for grant under the Equity Plan, the number of shares of common stock which were the subject of awards outstanding under the Equity Plan and are forfeited, terminated, canceled or expire after the adoption of the 2010 Equity Plan and the number of shares of common stock delivered to the Company either in exercise of an Equity Plan award or in satisfaction of a tax withholding obligation. The option price of statutory incentive stock options shall not be less than 100% of the fair market value of the stock at the date of grant, or in the case of certain statutory incentive stock options, at 110% of the fair market value at the time of the grant. The option price of nonqualified stock options is determined by the Board or Compensation Committee. Options must be exercised within a ten-year period or sooner if so specified within the option agreement. The term and vesting period for restricted stock awards and options granted under the 2010 Equity Plan are determined by the Board’s compensation committee.
During the six months ended June 28, 2014, the 2010 Equity Plan was amended to increase the number of authorized shares by 1.9 million. The Company has available approximately 3.0 million shares of common stock available for issuance under the Company’s 2010 Equity Plan in excess of shares of common stock which have already been reserved for under previously issued equity awards.
Stock Options
A summary of stock option activity under the stock award plans as of December 27, 2014 and changes during the twelve month period is as follows:
 
2014
 
Shares
 
Weighted
Average
Exercise
Price
Balance, beginning of year
558,850

 
$
5.09

Options forfeited/canceled
(391,600
)
 
5.75

Options exercised
(36,750
)
 
3.75

Balance, end of year
130,500

 
$
3.49

Exercisable, end of year
130,500

 
 


The Company has 130,500 stock options outstanding at December 27, 2014 which will expire by May 19, 2015 and have exercise prices that range from $3.15 to $3.87. The aggregate intrinsic value of the options at December 27, 2014 was approximately $13,000. No stock options were issued in 2014, 2013 or 2012. The intrinsic value of options exercised in 2014, 2013 and 2012 was approximately $26,000, $0 and $0, respectively. The Company has issued warrants to purchase 200,000 shares of the Company’s stock at $3.49. During the year ended December 29, 2012, the warrants became fully vested.
 
Cash received from option exercises under all share-based payment arrangements was approximately $0.1 million for fiscal year 2014. No tax benefits were realized during the three year period ended 2014 due to the existence of tax net operating loss carryforwards.
NonVested Restricted Common Stock
The Company has issued shares of nonvested restricted common stock to certain employees. Each award requires the employee to fulfill certain obligations, including remaining employed by the Company for one, two or four years (the vesting period) and in certain cases also meeting performance criteria. A summary of the activity for nonvested restricted common stock awards as of December 27, 2014 and changes during the twelve months then ended is presented below:
 
 
Shares
 
Weighted
Average
Grant
Fair Value
Balance, December 28, 2013
2,974,148

 
$
4.25

Granted
523,000

 
4.01

Forfeited
(102,400
)
 
3.33

Vested
(843,117
)
 
3.73

Balance, December 27, 2014
2,551,631

 
$
4.41



Included within the nonvested restricted common stock table above is 50,000 awards granted for which the performance conditions have yet to be determined and therefore a grant date has not yet been established for the award.  No stock based compensation expense has been recorded relating to this award during the three and twelve month period ended December 27, 2014.
The forfeitures in 2014 were primarily due to fact that the performance criteria were not met related to these awards.
Stock-Based Compensation
The following table summarizes stock-based compensation expense related to employee stock options and nonvested restricted common stock awards for the fiscal years 2014, 2013 and 2012 (no tax benefits were recognized):
 
 
2014
 
2013
 
2012
Cost of component revenues
$
766,221

 
$
414,842

 
$
513,789

Research and development
965,945

 
423,548

 
366,443

Selling, general and administrative
3,095,606

 
3,365,018

 
3,606,758

Total
$
4,827,772

 
$
4,203,408

 
$
4,486,990


Total unrecognized compensation expense for the nonvested restricted common stock as of December 27, 2014 totals $3.5 million and is expected to be recognized over a period of two years.
Concentrations of Risk
Concentrations of Risk
Concentrations of Risk
 
Ongoing credit evaluations of customers’ financial condition are performed and collateral, such as letters of credit, are generally not required. The following table depicts the customer’s trade receivable balance as a percentage of gross trade receivables as of the end of the year indicated. (The symbol “*” indicates that accounts receivables from that customer were less than 10% of the Company’s total accounts receivable.)
 
Percent of Gross
Accounts Receivable
Customer
2014
 
2013
Company A
1
 
22
Company B
5
 
12
Company C
9
 
12
Company D
32
 
*
Company E
14
 
*
Company F
8
 
*
Sales to significant non-affiliated customers for fiscal years 2014, 2013 and 2012, as a percentage of total revenues, is shown in the table below. Note the caption “Military Customers in Total” in the table below excludes research and development contracts. The Company sells its displays to Japanese customers through Ryoden Trading Company. (The symbol “*” indicates that sales to that customer were less than 10% of the Company’s total revenues.)
 
Sales as a Percent
of Total Revenue
 
Fiscal Year
Customer
2014
 
2013
 
2012
Military Customers in Total
45
 
38
 
57
Company A
*
 
18
 
12
Company C
11
 
*
 
*
Company D
26
 
13
 
22
Company E
*
 
*
 
21
Company F
*
 
*
 
*
U.S Government funded Research and Development Contracts
4
 
7
 
10
Income Taxes
Income Taxes
Income Taxes
The (benefit) provision for income taxes from continuing operations consists of the following for the fiscal years indicated:
 
 
Fiscal Year
 
2014
 
2013
 
2012
Current
 
 
 
 
 
Federal
$
—

 
$
(13,124,000
)
 
$
—

State
50,000

 
12,000

 
64,000

Foreign
—

 
(34,000
)
 
—

Total current provision (benefit)
50,000

 
(13,146,000
)
 
64,000

Deferred
 
 
 
 
 
Federal
(9,554,000
)
 
(3,616,000
)
 
(2,878,000
)
State
(1,709,000
)
 
644,000

 
(505,000
)
Foreign
411,000

 
(565,000
)
 
73,000

Change in valuation allowance
10,622,000

 
3,750,000

 
4,345,000

Total deferred (benefit) provision
(230,000
)
 
213,000

 
1,035,000

Total (benefit) provision for income taxes
$
(180,000
)
 
$
(12,933,000
)
 
$
1,099,000


Net operating losses were not utilized in 2014, 2013 and 2012 to offset federal and state taxes.
The actual income tax (benefit) provision reported from operations are different than those which would have been computed by applying the federal statutory tax rate to loss before income tax (benefit) provision. A reconciliation of income tax (benefit) provision from continuing operations as computed at the U.S. federal statutory income tax rate to the provision for income tax benefit is as follows:
 
 
Fiscal Year
 
2014
 
2013
 
2012
Tax provision at federal statutory rates
$
(9,964,000
)
 
$
(13,322,000
)
 
$
(7,002,000
)
State tax liability
33,000

 
8,000

 
42,000

Foreign deferred
371,000

 
(644,000
)
 
734,000

Foreign withholding
(196,000
)
 
308,000

 
1,170,000

Outside basis in KTC and Kowon, net
(394,000
)
 
(202,000
)
 
2,422,000

Goodwill
—

 
—

 
417,000

Nondeductible expenses
(21,000
)
 
306,000

 
(18,000
)
Increase in net state operating loss carryforwards
(177,000
)
 
(2,868,000
)
 
—

Utilization of net operating losses for U.K. research and development refund
1,089,000

 
—

 
—

Provision to tax return adjustments and state tax rate change
(516,000
)
 
(33,000
)
 
(462,000
)
Tax credits
(610,000
)
 
(390,000
)
 
(100,000
)
Non-deductible 162M compensation limitations
196,000

 
558,000

 
198,000

Non-deductible equity compensation
(687,000
)
 
(418,000
)
 
136,000

Other, net
74,000

 
14,000

 
(783,000
)
Change in valuation allowance
10,622,000

 
3,750,000

 
4,345,000

 
$
(180,000
)
 
$
(12,933,000
)
 
$
1,099,000


Pretax foreign losses from continuing operations were approximately $(2,588,000), $(4,966,000) and $(6,870,000) for fiscal years 2014, 2013 and 2012, respectively. The Company has made the decision to close Kowon and accordingly reflected a liability for unremitted earnings.
The benefit for income taxes for the fiscal year ended 2014 of $0.2 million represents the net of state and foreign withholding tax.

Deferred income taxes are provided to recognize the effect of temporary differences between tax and financial reporting. Deferred income tax assets and liabilities consist of the following:
 
 
Fiscal Year
 
2014
 
2013
Deferred tax liability:
 
 
 
Intangible asset
$
—

 
$
(141,000
)
       Foreign withholding liability
(1,282,000
)
 
(1,478,000
)
       Foreign unremitted earnings
(2,882,000
)
 
(3,276,000
)
Deferred tax assets:
 
 
 
Federal net operating loss carryforwards
22,758,000

 
15,322,000

State net operating loss carryforwards
1,689,000

 
624,000

Foreign net operating loss carryforwards
2,612,000

 
3,202,000

Equity awards
2,508,000

 
1,666,000

Tax credits
6,267,000

 
5,657,000

Equipment
1,024,000

 
838,000

Investments
5,279,000

 
4,594,000

Other
3,253,000

 
3,365,000

Net deferred tax assets
41,226,000

 
30,373,000

Valuation allowance
(42,508,000
)
 
(31,886,000
)
 
$
(1,282,000
)
 
$
(1,513,000
)

As of December 27, 2014, the Company has available for tax purposes federal net operating loss carryforwards (NOLs) of $65.0 million expiring through 2033. The Company has recognized a full valuation allowance on its net deferred tax assets as the Company has concluded that such assets are not more likely than not to be realized. The $10.6 million increase in valuation allowance during fiscal year 2014 was primarily due to an increase in net operating loss carryforwards. The 3.7 million increase in valuation allowance during fiscal year 2013 was primarily due to net operating losses generated of $8.6 million and the sale of III-V assets. The Company has not historically recorded, nor does it intend to record the tax benefits from stock awards until realized. Unrecorded benefits from stock awards approximated $10.3 million at December 27, 2014.
The Company has suspended operations and terminated the majority of employees at its Korean subsidiary, Kowon. The assets, primarily buildings and land, have been put up for sale. It is more likely than not that the Company's share of the net book value of its Korean investment would be repatriated to the U.S. resulting in a Korean withholding tax of $1.3 million. As a result of the Company no longer being permanently reinvested in Korea, a deferred tax liability for the unremitted earnings in the Korean subsidiary has been booked for $2.9 million.

In September 2013, the U.S. Department of the Treasury and the Internal Revenue Service released final regulations relating to guidance on applying tax rules to amounts paid to acquire, produce or improve tangible personal property as well as rules for materials and supplies. The Company is currently assessing these rules and the impacts to the financial statements, if any.
The Company’s income tax returns have not been examined by the Internal Revenue Service and are subject to examination for all years since 2001. State income tax returns are generally subject to examination for a period of three to five years after filing of the respective return. The state impact of any federal changes remains subject to examination by various states for a period of up to one year after formal notification to the states.
International jurisdictions have statutes of limitations generally ranging from three to seven years after filing of the respective return. Years still open to examination by tax authorities in major jurisdictions include Korea (2006 onward), Japan (2006 onward), Hong Kong (2008 onward) and United Kingdom (2011 onward). The Company is not currently under examination in these jurisdictions.
Accrued Warranty
Accrued Warranty
Accrued Warranty
The Company warrants its products against defect for 12 months. A provision for estimated future costs and estimated returns for credit relating to warranty is recorded in the period when product is shipped and revenue recognized, and is updated as additional information becomes available. The Company’s estimate of future costs to satisfy warranty obligations is based primarily on historical warranty expense experienced and a provision for potential future product failures. Changes in the accrued warranty for fiscal years 2014 and 2013 are as follows:
 
 
Fiscal Year Ended
 
December 27,
2014
 
December 28,
2013
Beginning Balance
$
716,000

 
$
716,000

Additions
389,000

 
798,000

Claim and reversals
(389,000
)
 
(798,000
)
Ending Balance
$
716,000

 
$
716,000

Employee Benefit Plan
Employee Benefit Plan
Employee Benefit Plan
The Company has an employee benefit plan pursuant to Section 401(k) of the Internal Revenue Code of 1986, as amended. In 2014, the plan allowed employees to defer an amount of their annual compensation up to a current maximum of $17,500 if they are under the age of 50 and $23,000 if they are over the age of 50. The Company matches 50% of all deferred compensation on the first 6% of each employee’s deferred compensation. The amount charged to operations in connection with this plan was approximately $224,000, $146,000 and $210,000 in fiscal years 2014, 2013 and 2012, respectively.
Commintments and Contingencies
Commitments and Contingencies
Commitments and Contingencies
Leases
The Company leases facilities located in Westborough, Massachusetts, Santa Clara, California, Scotts Valley, California, Dalgety Bay, Scotland and Nottingham, United Kingdom, under non-cancelable operating leases. The Westborough lease expires in 2023. The Santa Clara lease expires in 2016. The Scotts Valley lease expires in October 2015. The Dalgety Bay lease expires in 2016. The Company also leases two facilities in Nottingham, United Kingdom which expire in 2016 and 2017. Substantially all real estate taxes, insurance and maintenance expenses under these leases are the Company’s obligations and are expensed as incurred and were immaterial. The following is a schedule of minimum rental commitments under non-cancelable operating leases at December 27, 2014:
 
Fiscal Year ending,
Amount
2015
$
1,239,000

2016
908,000

2017
665,000

2018
641,000

2019
638,000

Thereafter
2,130,000

Total minimum lease payments
$
6,221,000


Amounts incurred under operating leases are recorded as rent expense on a straight-line basis and aggregated approximately $1.7 million in fiscal year 2014, $1.3 million in fiscal year 2013 and $0.8 million in fiscal year 2012.
Other Agreements
The Company has entered into various license agreements which require payment of royalties based upon a set percentage of product sales, subject in some cases, to certain minimum amounts. Total royalty expense approximated $37,000, $20,000 and $18,000, respectively, in fiscal years 2014, 2013 and 2012.

The Company received a $3.0 million grant in fiscal year 2008 from the Commonwealth of Massachusetts as an incentive to retain jobs in Massachusetts. As a result of the sale of the III-V product line the Company repaid all of such amounts to the state in 2013.
Litigation
Litigation
Litigation
The Company may engage in legal proceedings arising in the ordinary course of business. Claims, suits, investigations and proceedings are inherently uncertain and it is not possible to predict the ultimate outcome of such matters and our business, financial condition, results of operations or cash flows could be affected in any particular period.
Segments and Geographical Information
Segments and Geographical Information
Segments and Geographical Information
The Company’s chief operating decision maker is its Chief Executive Officer. During the year ended December 28, 2013, the Company transferred the manufacturing operations of Kowon to the Company's manufacturing facility in the United States and sold its III-V product line including its investment in KTC. As a result of these transactions, the Company has reorganized its operations to align with its new strategy to primarily focus on developing its wearable computing systems and its reflective display products. Accordingly, the Company has determined it has two reportable segments, FDD, the manufacturer of its reflective display products for test and simulation products, and Kopin, which is comprised of Kopin Corporation, Kowon, Intoware and eMDT.
 
Kopin
 
FDD
 
Total
2014
 
 
 
 
 
Revenues
$
28,333

 
$
3,474

 
$
31,807

Net loss attributable to the controlling interest
(26,402
)
 
(1,810
)
 
(28,212
)
Total assets from continuing operations
121,301

 
1,640

 
122,941

Long-lived assets from continuing operations
4,343

 
246

 
4,589

2013
 
 
 
 
 
Revenues
$
19,883

 
$
3,014

 
$
22,898

Net loss attributable to the controlling interest
(2,003
)
 
(2,707
)
 
(4,710
)
Total assets from continuing operations
143,953

 
2,179

 
146,132

Long-lived assets from continuing operations
5,488

 
547

 
6,035

2012
 
 
 
 
 
Revenues
$
31,879

 
$
2,763

 
$
34,642

Net loss attributable to the controlling interest
(17,067
)
 
(4,083
)
 
(21,150
)
Total assets from continuing operations
134,375

 
4,202

 
138,577

Long-lived assets from continuing operations
7,728

 
758

 
8,486



Geographical revenue information for the three years ended December 27, 2014, December 28, 2013 and December 29, 2012 was based on the location of the customers and is as follows:
 
 
Fiscal Year
 
2014
 
2013
 
2012
 
Revenue
 
% of Total
 
Revenue
 
% of Total
 
Revenue
 
% of Total
US
$
19,695,000

 
62
%
 
$
11,927,000

 
53
%
 
$
25,356,000

 
73
%
Other Americas
416,000

 
1
%
 
230,000

 
1
%
 
93,000

 
—
%
Total Americas
20,111,000

 
63
%
 
12,157,000

 
54
%
 
25,449,000

 
73
%
Asia-Pacific
8,245,000

 
26
%
 
8,292,000

 
36
%
 
7,132,000

 
21
%
Europe
3,451,000

 
11
%
 
2,449,000

 
10
%
 
2,061,000

 
6
%
  Total Revenues
31,807,000

 
100
%
 
$
22,898,000

 
100
%
 
$
34,642,000

 
100
%



Long-lived assets by geographic area are as follows:
 
 
Fiscal Years
 
2014
 
2013
United States of America
$
2,689,000

 
$
3,050,000

United Kingdom
377,000

 
795,000

Republic of Korea
1,523,000

 
2,190,000

 
$
4,589,000

 
$
6,035,000

Selected Quarterly Financial Information (Unaudited)
Selected Quarterly Financial Information (Unaudited)
Selected Quarterly Financial Information (Unaudited)
The following tables present Kopin’s quarterly operating results for the fiscal years ended December 27, 2014 and December 28, 2013. The information for each of these quarters is unaudited and has been prepared on the same basis as the audited consolidated financial statements. In the opinion of management, all necessary adjustments, consisting only of normal recurring adjustments, have been included to present fairly the unaudited consolidated quarterly results when read in conjunction with Kopin’s audited consolidated financial statements and related notes. These operating results are not necessarily indicative of the results of any future period.
Quarterly Periods During Fiscal Year Ended December 27, 2014:
 
 
Three months ended March 29, 2014
 
Three months
ended
June 28,
2014 (3)
 
Three months ended September 27, 2014
 
Three months
ended
December 27,
2014
 
(In thousands, except per share data)
Revenue
$
4,695

 
$
6,943

 
$
9,532

 
$
10,637

Gross profit (2)
$
2

 
$
753

 
$
3,861

 
$
2,701

Loss from operations
$
(9,614
)
 
$
(7,269
)
 
$
(5,520
)
 
$
(6,073
)
Net loss attributable to the controlling interest
$
(9,134
)
 
$
(8,806
)
 
$
(4,469
)
 
$
(5,302
)
Net loss per share from continuing operations (1):
 
 
 
 
 
 
 
Basic
$
(0.15
)
 
$
(0.14
)
 
$
(0.08
)
 
$
(0.08
)
Diluted
$
(0.15
)
 
$
(0.14
)
 
$
(0.08
)
 
$
(0.08
)
Shares used in computing net loss per share from continuing operations:
 
 
 
 
 
 
 
Basic
62,530

 
62,644

 
62,647

 
62,734

Diluted
62,530

 
62,644

 
62,647

 
62,734

 
(1)
Net loss per share is computed independently for each of the quarters presented; accordingly, the sum of the quarterly net income per share may not equal the total computed for the year.
(2)
Gross profit is defined as net product revenue less cost of product revenues.
(3)
Includes $1.3 million impact in loss from operations and net loss attributable to the controlling interest attributable to the write off of an investment for the three month period ended June 28, 2014, as described in Note 4.
 
Quarterly Periods During Fiscal Year Ended December 28, 2013:
 
 
Three months ended March 30, 2013
 
Three months ended June 29, 2013
 
Three months ended September 28, 2013
 
Three months
ended
December 28,
2013 (3)
 
(In thousands, except per share data)
Revenue
$
6,319

 
$
6,079

 
$
4,950

 
$
5,550

Gross profit (2)
$
(396
)
 
$
(595
)
 
$
267

 
$
645

(Loss) income from continuing operations
$
1,168

 
$
(8,062
)
 
$
(9,015
)
 
$
(9,844
)
Net loss attributable to the controlling interest
$
21,634

 
$
(7,910
)
 
$
(8,771
)
 
$
(9,660
)
Net loss per share from continuing operations (1):
 
 
 
 
 
 
 
Basic
$
0.34

 
$
(0.13
)
 
$
(0.14
)
 
$
(0.16
)
Diluted
$
0.34

 
$
(0.13
)
 
$
(0.14
)
 
$
(0.16
)
Shares used in computing net loss per share from continuing operations:
 
 
 
 
 
 
 
Basic
63,936

 
62,492

 
63,542

 
61,529

Diluted
63,936

 
62,492

 
63,542

 
61,529

 
(1)
Net loss per share is computed independently for each of the quarters presented; accordingly, the sum of the quarterly net income per share may not equal the total computed for the year.
(2)
Gross profit is defined as net component revenue less cost of component revenues.
(3)
Includes $4.0 million impact in loss from continuing operations and net loss attributable to the controlling interest attributable to the impairment of intangibles and write off of investments for the three month period ended December 28, 2013, as described in Notes 4 and 6.
Schedule II - Valuation and Qualifying Accounts
Schedule II - Valuation and Qualifying Accounts
SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS
Fiscal Years Ended December 27, 2014, December 28, 2013 and December 29, 2012
 
Description
Balance at
Beginning
of Year
 
Additions
Charged
to
Income
 
Deductions
from
Reserve
 
Balance at
End of
Year
Reserve deducted from assets—allowance for doubtful accounts:
 
 
 
 
 
 
 
2012
$
513,000

 
$
139,000

 
$
(341,000
)
 
$
311,000

2013
311,000

 
19,000

 
(128,000
)
 
202,000

2014
202,000

 
81,000

 
(17,000
)
 
266,000

Summary of Significant Accounting Policies (Policies)
Principles of Consolidation 
Principles of Consolidation
The consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries, a majority owned 93% subsidiary, Kowon Technology Co., Ltd. (Kowon), located in Korea, a majority owned 58% subsidiary, Intoware Ltd. (Intoware), located in the United Kingdom, (formerly known as Ikanos Consulting Limited) and a majority owned 80% subsidiary, eMDT America Inc (eMDT), located in California (collectively the Company). All intercompany transactions and balances have been eliminated. Amounts of Kowon, Intoware and eMDT not attributable to the Company are referred to as noncontrolling interests in the consolidated statements of operations and consolidated statements of comprehensive loss. Investments in business entities in which the Company does not have control but has the ability to exercise significant influence over operating and financial policies are accounted for by the equity method.
In 2013, the Company paid approximately $3.7 million to acquire an additional 15% ownership in its Kowon subsidiary which raised its ownership from 78% to 93%. The Company ceased its production activities at its Kowon facility in 2013 but as of December 27, 2014, the closure of this facility did not meet the criteria for assets held for sale.
Revenue Recognition 
Revenue Recognition
The Company recognizes revenue if four basic criteria have been met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred and services rendered; (3) the price to the buyer is fixed or determinable; and (4) collectability is reasonably assured. The Company does not recognize revenue for products prior to customer acceptance unless it believes the product meets all customer specifications and the Company has a history of consistently achieving customer acceptance of the product. Provisions for product returns and allowances are recorded in the same period as the related revenues. The Company analyzes historical returns, current economic trends and changes in customer demand and acceptance of product when evaluating the adequacy of sales returns and other allowances. Certain product sales are made to distributors under agreements allowing for a limited right of return on unsold products. Sales to distributors are primarily made for sales to the distributors' customers and not for their stocking of inventory. The Company delays revenue recognition for its estimate of distributor claims of right of return on unsold products based upon its historical experience with the Company’s products and specific analysis of amounts subject to return based upon discussions with the Company’s distributors or their customers.
The Company recognizes revenues from long-term research and development contracts on the percentage-of-completion method of accounting as work is performed, based upon the ratio of costs or hours already incurred to the estimated total cost of completion or hours of work to be performed. Revenue recognized at any point in time is limited to the amount funded by the U.S. government or contracting entity. The Company accounts for product development and research contracts that have established prices for distinct phases as if each phase were a separate contract. In some instances, the Company is contracted to create a deliverable which is anticipated to be qualified and go into full rate production stages. In those cases, the revenue recognition methodology will change from the percentage of completion method to the units-of-delivery method as new contracts are received after formal qualification has been completed. Under certain of its research and development contracts, the Company recognizes revenue on a milestone methodology.  This revenue is recognized when the Company achieves specified milestones based on its past performance.
 
The Company classifies amounts earned on contracts in progress that are in excess of amounts billed as unbilled receivables and classifies amounts received in excess of amounts earned as billings in excess of revenues earned. The Company invoices based on dates specified in the related agreement or in periodic installments based upon its invoicing cycle. The Company recognizes the entire amount of an estimated ultimate loss in its financial statements at the time the loss on a contract becomes known.
Research and Development Costs 
Research and Development Costs
Research and development expenses are incurred in support of internal display product development programs or programs funded by agencies or prime contractors of the U.S. government and commercial partners. Research and development costs include staffing, purchases of materials and laboratory supplies, circuit design costs, fabrication and packaging of experimental display products, and overhead, and are expensed immediately.
Cash and Cash Equivalents 
Cash and Equivalents and Marketable Securities
The Company considers all highly liquid, short-term debt instruments with original maturities of three months or less to be cash equivalents.
Marketable Securities 
Marketable debt securities consist primarily of commercial paper, medium-term corporate notes, and United States government and agency backed securities. The Company classifies these marketable debt securities as available-for-sale at fair value in “Marketable debt securities, at fair value.” The investments in Vuzix Corporation (Vuzix) and GCS Holdings are included in "Other Assets" as available-for-sale and at fair value. The Company records the amortization of premium and accretion of discounts on marketable debt securities in the results of operations.
The Company uses the specific identification method as a basis for determining cost and calculating realized gains and losses with respect to marketable debt securities. The gross gains and losses realized related to sales of marketable debt securities were not material during fiscal years 2014, 2013 and 2012
Inventory 
Inventory
Inventory is stated at the lower of cost (determined on the first-in, first-out method) or market and consists of the following at December 27, 2014 and December 28, 2013:
 
2014
 
2013
Raw materials
$
2,057,202

 
$
1,441,569

Work-in-process
1,551,799

 
1,003,540

Finished goods
472,885

 
632,946

 
$
4,081,886

 
$
3,078,055

Property, Plant and Equipment 
Property, plant and equipment
Property, plant and equipment are recorded at cost. Depreciation and amortization are provided using the straight-line method over the estimated useful lives of the assets, generally 3 to 10 years. Leasehold improvements and leased equipment are amortized over the shorter of the term of the lease or the useful life of the improvement or equipment. As discussed below, obligations for asset retirement are accrued at the time property, plant and equipment is initially purchased or as such obligations are generated from use.
Intangible Assets 
Intangible assets

At December 27, 2014 intangible assets consisted of patents. At December 28, 2013, intangible assets include patents, customer relationships, developed technology and trademarks. Customer relationships represent the fair value of the underlying relationships with customers. Developed technology represents the fair value of technology as it exists in current products and has value through its continued use or reuse. The trademark represents the brand and name recognition associated with the marketing of products and was determined to have a finite life.
Identifiable intangible assets are amortized using the straight-line method over the estimated useful lives of the assets, generally three to seven years.
Product Warranty 
Product Warranty
The Company generally sells products with a limited warranty of product quality and a limited indemnification of customers against intellectual property infringement claims related to the Company’s products. The Company accrues for known warranty and indemnification issues if a loss is probable and can be reasonably estimated, and accrues for estimated incurred but unidentified issues based on historical activity. As of December 27, 2014 and December 28, 2013, the Company had warranty reserves of $0.7 million. For the fiscal years 2014, 2013 and 2012 warranty claims and reversals were approximately $0.4 million, $0.8 million and $2.2 million, respectively.
Asset Retirement Obligations 
Asset Retirement Obligations
The Company recorded asset retirement obligations (ARO) liabilities of $0.3 million at December 27, 2014 and December 28, 2013, respectively. This represents the legal obligations associated with retirement of the Company’s assets when the timing and/or method of settling the obligation are conditional on a future event that may or may not be within the control of the Company.
 
2014
 
2013
Beginning balance
$
329,435

 
$
322,477

Additions
—

 
—

Charges
—

 
—

Accretion and exchange rate change
(18,248
)
 
6,958

Ending balance
$
311,187

 
$
329,435

Income Taxes 
Income Taxes
The consolidated financial statements reflect provisions for federal, state, local and foreign income taxes. The Company recognizes deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis, as well as operating loss and tax credit carryforwards. The Company measures deferred tax assets and liabilities using enacted tax rates expected to apply to taxable income in the years in which those temporary differences and carryforwards are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company provides valuation allowances if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

Foreign Currency 
Foreign Currency
Assets and liabilities of non-U.S. operations where the functional currency is other than the U.S. dollar are translated from the functional currency into U.S. dollars at year end exchange rates, and revenues and expenses at average rates prevailing during the year. Resulting translation adjustments are accumulated as part of accumulated other comprehensive income. Transaction gains or losses are recognized in income or loss in the period in which they occur.
Net (Loss) Income Per Share 
Net (Loss) Income Per Share
Basic net (loss) income per share is computed using the weighted-average number of shares of common stock outstanding during the period less any unvested restricted shares. Diluted earnings per common share is calculated using weighted-average shares outstanding and contingently issuable shares, less weighted-average shares reacquired during the period. The net outstanding shares are adjusted for the dilutive effect of shares issuable upon the assumed conversion of the Company’s common stock equivalents, which consist of outstanding stock options and unvested restricted stock.
Weighted-average common shares outstanding used to calculate earnings per share, is as follows:
 
 
2014
 
2013
 
2012
Weighted-average common shares outstanding—basic
62,638,675

 
62,347,852

 
63,617,680

Stock options and nonvested restricted common stock
—

 
—

 
—

Weighted-average common shares outstanding—diluted
62,638,675

 
62,347,852

 
63,617,680


The following were not included in weighted-average common shares outstanding- diluted because they are anti-dilutive or performance conditions have not been met at the end of the period.
 
 
2014
 
2013
 
2012
Nonvested restricted common stock
2,551,631

 
3,024,148

 
2,283,048

Stock options
130,500

 
558,850

 
983,680

Total
2,682,131

 
3,582,998

 
3,266,728


    
Not included in weighted average common shares outstanding-diluted are the warrants to purchase 200,000 shares of the
Company’s common stock for $3.49 per share.
Concentration of Credit Risk 
Concentration of Credit Risk
Financial instruments that potentially subject the Company to concentration of credit risk other than marketable securities consist principally of trade accounts receivable and the note receivable from IQE, plc. Trade receivables are primarily derived from sales to manufacturers of consumer electronic devices and wireless components or military applications.
The Company primarily invests its excess cash in government backed and corporate financial instruments that management believes to be of high credit worthiness, which bear lower levels of relative credit risk. The Company relies on rating agencies to ascertain the credit worthiness of its marketable securities and, where applicable, guarantees by the Federal Deposit Insurance Company. The Company sells its products to customers worldwide and generally does not require collateral. The Company maintains a reserve for potential credit losses.
Fair Value of Financial Instruments 
Fair Value of Financial Instruments
Financial instruments consist of current assets (except inventories, income tax receivables and prepaid assets) and certain current liabilities. Current assets (excluding marketable securities which are recorded at fair value) and current liabilities are carried at cost, which approximates fair value.
Stock-Based Compensation 
Stock-Based Compensation
The fair value of stock option awards is estimated on the date of grant using the Black-Scholes-Merton option-pricing model. There were no stock options granted in fiscal years 2014, 2013 or 2012.
 
The fair value of nonvested restricted common stock awards is generally the market value of the Company’s equity shares on the date of grant. The nonvested restricted common stock awards require the employee to fulfill certain obligations, including remaining employed by the Company for one, two or four years (the vesting period) and in certain cases also require meeting either performance criteria or the Company’s stock achieving a certain price. The performance criteria primarily consist of the achievement of established milestones. For nonvested restricted common stock awards which solely require the recipient to remain employed with the Company, the stock compensation expense is amortized over the anticipated service period. For nonvested restricted common stock awards which require the achievement of performance criteria, the Company reviews the probability of achieving the performance goals on a periodic basis. If the Company determines that it is probable that the performance criteria will be achieved, the amount of compensation cost derived for the performance goal is amortized over the service period. If the performance criteria are not met, no compensation cost is recognized and any previously recognized compensation cost is reversed. The Company recognizes compensation costs on a straight-line basis over the requisite service period for time vested awards.

In 2013, the Company granted compensation awards to its Chief Executive Officer that consisted of two grants of 150,000 shares of restricted stock each. One of the grants will vest at the end of the first 10 consecutive trading day period following the grant date during which the Company’s common stock trades at a price per share equal to or greater than $6.00. The other award will vest at the end of the first 10 consecutive trading day period following the grant date during which the Company’s common stock trades at a price per share equal to or greater than $7.00. In 2012, the Company granted compensation awards to its Chief Executive Officer that consisted of a grant of 260,000 shares of restricted stock and a grant of 380,000 shares of phantom stock to be settled in cash. The 260,000 shares of restricted stock and the 380,000 shares of phantom stock will vest at the end of the first 10 consecutive trading day period following the grant date during which the Company’s common stock trades at a price per share equal to or greater than $5.25, prior to September 12, 2016. The vesting of the awards upon achieving a closing stock price of $6.00, $7.00 and $5.25 for 10 consecutive days is considered a market condition. The accounting for the 150,000, 150,000 and 260,000 shares requires the fair market value of the shares to be determined on the grant day and then this fair market value is expensed straight-line over the derived service period. The accounting for the phantom stock award requires the Company to periodically assess the fair market value of the award, with increases or decreases in the fair market value being reflected in the statements of operations.

In 2013, the Company granted a compensation award to its Chief Executive Officer that consisted of a grant of 300,000 shares of restricted stock that will vest upon the Company shipping 50,000 units of a new display. The compensation cost of this award will be recognized over the period the Company ships the displays. As of December 27, 2014, these awards were not yet earned and no compensation expense has been recorded.
Comprehensive Income, Policy [Policy Text Block] 
Comprehensive Loss
Comprehensive loss is the total of net (loss) income and all other non-owner changes in equity including such items as unrealized holding (losses) gains on marketable equity and debt securities classified as available-for-sale and foreign currency translation adjustments.

The components of accumulated other comprehensive income are as follows:
 
Cumulative
Translation
Adjustment
 
Unrealized Holding
 Gain (Loss) on
Marketable
Securities
 
Accumulated Other
Comprehensive
Income
Balance as of December 31, 2011
$
1,319,870

 
$
2,826,154

 
$
4,146,024

Changes during year
2,222,234

 
144,534

 
2,366,768

Balance as of December 29, 2012
3,542,104

 
2,970,688

 
6,512,792

Changes during year
(1,017,403
)
 
(2,053,392
)
 
(3,070,795
)
Balance as of December 28, 2013
2,524,701

 
917,296

 
3,441,997

Changes during year
(990,626
)
 
674,868

 
(315,758
)
Balance as of December 27, 2014
$
1,534,075

 
$
1,592,164

 
$
3,126,239

Impairment Long-Lived Assets 
Impairment of Long-Lived Assets
The Company periodically reviews the carrying value of its long-lived assets to determine if facts and circumstances suggest that they may be impaired or that the amortization or depreciation period may need to be changed. The carrying value of a long-lived asset is considered impaired when the anticipated identifiable undiscounted cash flows from such asset are less than its carrying value. For assets that are to be held and used, impairment is measured based upon the amount by which the carrying amount of the asset exceeds its fair value. The carrying value of the Company’s long-lived assets was $4.6 million at December 27, 2014.
Recently Adopted Accounting Pronouncements 
Recently Issued Accounting Pronouncements
In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers (Topic 606). The reporting standard requires the Company to identify the performance obligations in a contract, determine the transaction price, allocate the transaction price to each of the obligations and then recognizes the transaction price as the obligations are fulfilled. The standard also requires certain new disclosures. The standard is effective for annual and interim reporting periods beginning after December 15, 2016. The Company is currently assessing the potential impact of the adoption of ASU 2014-09 on its consolidated financial statements.
Statement of Comprehensive Income

During the twelve months ended December 27, 2014, the change in the Company's accumulated other comprehensive income was the net of $(1.1) million cumulative translation adjustment and $0.7 million unrealized holding gains on marketable securities.
Summary of Significant Accounting Policies (Tables)
Schedule of Inventory, Current 
Inventory is stated at the lower of cost (determined on the first-in, first-out method) or market and consists of the following at December 27, 2014 and December 28, 2013:
 
2014
 
2013
Raw materials
$
2,057,202

 
$
1,441,569

Work-in-process
1,551,799

 
1,003,540

Finished goods
472,885

 
632,946

 
$
4,081,886

 
$
3,078,055

Schedule of Change in Asset Retirement Obligation 
The Company recorded asset retirement obligations (ARO) liabilities of $0.3 million at December 27, 2014 and December 28, 2013, respectively. This represents the legal obligations associated with retirement of the Company’s assets when the timing and/or method of settling the obligation are conditional on a future event that may or may not be within the control of the Company.
 
2014
 
2013
Beginning balance
$
329,435

 
$
322,477

Additions
—

 
—

Charges
—

 
—

Accretion and exchange rate change
(18,248
)
 
6,958

Ending balance
$
311,187

 
$
329,435

Schedule of Weighted Average Number of Shares 
Weighted-average common shares outstanding used to calculate earnings per share, is as follows:
 
 
2014
 
2013
 
2012
Weighted-average common shares outstanding—basic
62,638,675

 
62,347,852

 
63,617,680

Stock options and nonvested restricted common stock
—

 
—

 
—

Weighted-average common shares outstanding—diluted
62,638,675

 
62,347,852

 
63,617,680

Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share 
The following were not included in weighted-average common shares outstanding- diluted because they are anti-dilutive or performance conditions have not been met at the end of the period.
 
 
2014
 
2013
 
2012
Nonvested restricted common stock
2,551,631

 
3,024,148

 
2,283,048

Stock options
130,500

 
558,850

 
983,680

Total
2,682,131

 
3,582,998

 
3,266,728

Schedule of Accumulated Other Comprehensive Income (Loss) 
The components of accumulated other comprehensive income are as follows:
 
Cumulative
Translation
Adjustment
 
Unrealized Holding
 Gain (Loss) on
Marketable
Securities
 
Accumulated Other
Comprehensive
Income
Balance as of December 31, 2011
$
1,319,870

 
$
2,826,154

 
$
4,146,024

Changes during year
2,222,234

 
144,534

 
2,366,768

Balance as of December 29, 2012
3,542,104

 
2,970,688

 
6,512,792

Changes during year
(1,017,403
)
 
(2,053,392
)
 
(3,070,795
)
Balance as of December 28, 2013
2,524,701

 
917,296

 
3,441,997

Changes during year
(990,626
)
 
674,868

 
(315,758
)
Balance as of December 27, 2014
$
1,534,075

 
$
1,592,164

 
$
3,126,239

Discontinued Operations (Tables)
Schedule of Disposal Groups, Including Discontinued Operations, Income Statement, Balance Sheet and Additional Disclosures
The following table summarizes the results from discontinued operations:
 
 
 
December 28, 2013
 
December 29, 2012
Net product and research and development revenues
$
2.3

 
$
58.8

(Loss) gain from discontinued operations before income taxes
(0.2
)
 
4.5

(Provision) benefit for income taxes on discontinued operations
—

 
(1.7
)
Discontinued operations, net of tax
(0.2
)
 
2.8

Gain on sale, net of $13.1 million of tax
20.4

 
—

Income from discontinued operations, net of tax
$
20.2

 
$
2.8



Property, Plant and Equipment (Tables)
Property, Plant and Equipment
Property, plant and equipment consisted of the following at December 27, 2014 and December 28, 2013:
 
 
Useful Life
 
2014
 
2013
Land
 
 
$
877,485

 
$
915,595

Buildings
10 years
 
2,298,367

 
2,398,188

Equipment
3-5 years
 
19,696,919

 
20,993,220

Leasehold improvements
Life of the lease
 
3,652,395

 
3,441,553

Furniture and fixtures
3 years
 
886,985

 
910,270

Equipment under construction
 
 
657,142

 
623,503

 
 
 
28,069,293

 
29,282,329

Accumulated depreciation and amortization
 
 
(23,479,872
)
 
(23,247,366
)
Net property, plant and equipment
 
 
$
4,589,421

 
$
6,034,963

Other Assets and Amounts Due to / Due From Affiliates (Tables)
Equity Method Investments, Summarized Financial Information [Table Text Block] 
Summarized financial information for 2012 includes Kobrite for the period ended September 30, 2012 (Kobrite's results are recorded one quarter in arrears) and Intoware's operating results for the six month period January 1, 2012 through June 30, 2012. Summarized financial information for 2013 includes Kobrite for the year ended September 30, 2013 and AZ for the five month period August 1, 2013 through December 28, 2013. As of December 27, 2014, the Company no longer has any equity-method investments with value in the financial statements.
 
 
2013
 
2012
Current assets
$
7,769,000

 
$
9,581,000

Noncurrent assets
10,663,000

 
12,701,000

Current liabilities
1,207,000

 
1,215,000

Revenues
5,085,000

 
6,010,000

Margin loss
(2,501,000
)
 
(2,732,000
)
Loss from operations
(6,114,000
)
 
(4,938,000
)
Net loss
(5,526,000
)
 
(5,308,000
)
Equity Method Investments [Table Text Block] 
Equity losses in unconsolidated affiliates recorded in the consolidated statement of operations are as follows:
 
 
2014
 
2013
 
2012
KoBrite
$
(102,305
)
 
$
(406,811
)
 
$
(573,265
)
Intoware
—

 
—

 
(106,322
)
Ask Ziggy
$
(284,137
)
 
$
(218,287
)
 
$
—

Total
$
(386,442
)
 
$
(625,098
)
 
$
(679,587
)
Schedule of Other Assets [Table Text Block] 
Other assets consist of the following as of December 27, 2014 and December 28, 2013:
 
 
2014
 
2013
Marketable Equity Securities
 
 
 
        Vuzix Corporation
$
1,500,777

 
$
1,433,102

 GCS Holdings
180,347

 
—

Non-Marketable Securities—Equity Method Investments
 
 
 
 KoBrite
—

 
1,421,592

Other
219,704

 
169,764

Total Other Assets
$
1,900,828

 
$
3,024,458

Goodwill and Intangibles (Tables)
Schedule of Goodwill 
The Company’s goodwill balance is as follows: 
 
Fiscal Year Ended
 
December 27, 2014
 
December 28, 2013
Beginning Balance
$
1,016,132

 
$
684,789

Acquisition of Intoware
—

 
395,713

Adjustments
(39,681
)
 
(64,370
)
Ending Balance
$
976,451

 
$
1,016,132

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense 
The Company will amortize the remaining balance of intangible assets of $616,759 in 2015.
Financial Instruments (Tables)
Fair Value, by Balance Sheet Grouping 
The following table details the fair value measurements within the fair value hierarchy of the Company’s financial assets:
 
 
 
 
Fair Value Measurement at December 27, 2014 Using:
 
Total
 
Level 1        
 
Level 2        
 
Level 3        
Money Markets and Cash Equivalents
$
14,635,802

 
$
14,635,802

 
$
—

 
$
—

U.S. Government Securities
57,697,142

 
21,218,340

 
36,478,802

 
—

Corporate Debt
5,970,983

 
—

 
5,970,983

 
—

Certificates of Deposit
12,555,010

 
—

 
12,555,010

 
—

Vuzix Corporation
1,500,777

 
1,500,777

 
—

 
—

GCS Holdings
180,347

 
180,347

 
—

 
—

 
$
92,540,061

 
$
37,535,266

 
$
55,004,795

 
$
—

 
 
 
 
Fair Value Measurement at December 28, 2013 Using:
 
Total
 
Level 1        
 
Level 2        
 
Level 3        
Money Markets and Cash Equivalents
$
16,756,666

 
$
16,756,666

 
$
—

 
$
—

U.S. Government Securities
68,284,392

 
16,542,003

 
51,742,389

 
—

Corporate Debt
12,984,331

 
—

 
12,984,331

 
—

Certificates of Deposit
14,703,812

 
—

 
14,703,812

 
—

Vuzix Corporation
1,433,102

 
1,433,102

 
—

 
—

 
$
114,162,303

 
$
34,731,771

 
$
79,430,532

 
$
—

Available-for-sale Securities 
Investments in available-for-sale marketable debt securities are as follows at December 27, 2014 and December 28, 2013:
 
 
 
Amortized Cost
 
Unrealized Gains
 
Unrealized Losses
 
Fair Value
 
2014
 
2013
 
2014
 
2013
 
2014
 
2013
 
2014
 
2013
U.S. government and agency backed securities
$
57,897,914

 
$
68,970,505

 
$
—

 
$
—

 
$
(200,772
)
 
$
(686,113
)
 
$
57,697,142

 
$
68,284,392

Corporate debt and certificates of deposits
18,564,823

 
27,767,513

 
—

 
—

 
(38,830
)
 
(79,370
)
 
18,525,993

 
27,688,143

Total
$
76,462,737

 
$
96,738,018

 
$
—

 
$
—

 
$
(239,602
)
 
$
(765,483
)
 
$
76,223,135

 
$
95,972,535

Investments Classified by Contractual Maturity Date 
The contractual maturity of the Company’s marketable debt securities is as follows at December 27, 2014:
 
 
Less than
One year
 
One to
Five years
 
Greater than
Five years
 
Total
U.S. government and agency backed securities
$
14,618,790

 
$
35,548,345

 
$
7,530,007

 
$
57,697,142

Corporate debt and certificates of deposits
15,883,913

 
1,680,830

 
961,250

 
18,525,993

Total
$
30,502,703

 
$
37,229,175

 
$
8,491,257

 
$
76,223,135

Stockholders' Equity and Stock-Based Compensation (Tables)
Stock- Based Compensation 
A summary of stock option activity under the stock award plans as of December 27, 2014 and changes during the twelve month period is as follows:
 
2014
 
Shares
 
Weighted
Average
Exercise
Price
Balance, beginning of year
558,850

 
$
5.09

Options forfeited/canceled
(391,600
)
 
5.75

Options exercised
(36,750
)
 
3.75

Balance, end of year
130,500

 
$
3.49

Exercisable, end of year
130,500

 
 
NonVested Restricted Common Stock 
A summary of the activity for nonvested restricted common stock awards as of December 27, 2014 and changes during the twelve months then ended is presented below:
 
 
Shares
 
Weighted
Average
Grant
Fair Value
Balance, December 28, 2013
2,974,148

 
$
4.25

Granted
523,000

 
4.01

Forfeited
(102,400
)
 
3.33

Vested
(843,117
)
 
3.73

Balance, December 27, 2014
2,551,631

 
$
4.41

Stock-Based Compensation Expense 
The following table summarizes stock-based compensation expense related to employee stock options and nonvested restricted common stock awards for the fiscal years 2014, 2013 and 2012 (no tax benefits were recognized):
 
 
2014
 
2013
 
2012
Cost of component revenues
$
766,221

 
$
414,842

 
$
513,789

Research and development
965,945

 
423,548

 
366,443

Selling, general and administrative
3,095,606

 
3,365,018

 
3,606,758

Total
$
4,827,772

 
$
4,203,408

 
$
4,486,990

Concentrations of Risk (Tables)
Schedules of Concentration of Risk, by Risk Factor
The following table depicts the customer’s trade receivable balance as a percentage of gross trade receivables as of the end of the year indicated. (The symbol “*” indicates that accounts receivables from that customer were less than 10% of the Company’s total accounts receivable.)
 
Percent of Gross
Accounts Receivable
Customer
2014
 
2013
Company A
1
 
22
Company B
5
 
12
Company C
9
 
12
Company D
32
 
*
Company E
14
 
*
Company F
8
 
*
Sales to significant non-affiliated customers for fiscal years 2014, 2013 and 2012, as a percentage of total revenues, is shown in the table below. Note the caption “Military Customers in Total” in the table below excludes research and development contracts. The Company sells its displays to Japanese customers through Ryoden Trading Company. (The symbol “*” indicates that sales to that customer were less than 10% of the Company’s total revenues.)
 
Sales as a Percent
of Total Revenue
 
Fiscal Year
Customer
2014
 
2013
 
2012
Military Customers in Total
45
 
38
 
57
Company A
*
 
18
 
12
Company C
11
 
*
 
*
Company D
26
 
13
 
22
Company E
*
 
*
 
21
Company F
*
 
*
 
*
U.S Government funded Research and Development Contracts
4
 
7
 
10
Income Taxes (Tables)
Schedule of Components of Income Tax Expense (Benefit) 
The (benefit) provision for income taxes from continuing operations consists of the following for the fiscal years indicated:
 
 
Fiscal Year
 
2014
 
2013
 
2012
Current
 
 
 
 
 
Federal
$
—

 
$
(13,124,000
)
 
$
—

State
50,000

 
12,000

 
64,000

Foreign
—

 
(34,000
)
 
—

Total current provision (benefit)
50,000

 
(13,146,000
)
 
64,000

Deferred
 
 
 
 
 
Federal
(9,554,000
)
 
(3,616,000
)
 
(2,878,000
)
State
(1,709,000
)
 
644,000

 
(505,000
)
Foreign
411,000

 
(565,000
)
 
73,000

Change in valuation allowance
10,622,000

 
3,750,000

 
4,345,000

Total deferred (benefit) provision
(230,000
)
 
213,000

 
1,035,000

Total (benefit) provision for income taxes
$
(180,000
)
 
$
(12,933,000
)
 
$
1,099,000

Schedule of Effective Income Tax Rate Reconciliation 
The actual income tax (benefit) provision reported from operations are different than those which would have been computed by applying the federal statutory tax rate to loss before income tax (benefit) provision. A reconciliation of income tax (benefit) provision from continuing operations as computed at the U.S. federal statutory income tax rate to the provision for income tax benefit is as follows:
 
 
Fiscal Year
 
2014
 
2013
 
2012
Tax provision at federal statutory rates
$
(9,964,000
)
 
$
(13,322,000
)
 
$
(7,002,000
)
State tax liability
33,000

 
8,000

 
42,000

Foreign deferred
371,000

 
(644,000
)
 
734,000

Foreign withholding
(196,000
)
 
308,000

 
1,170,000

Outside basis in KTC and Kowon, net
(394,000
)
 
(202,000
)
 
2,422,000

Goodwill
—

 
—

 
417,000

Nondeductible expenses
(21,000
)
 
306,000

 
(18,000
)
Increase in net state operating loss carryforwards
(177,000
)
 
(2,868,000
)
 
—

Utilization of net operating losses for U.K. research and development refund
1,089,000

 
—

 
—

Provision to tax return adjustments and state tax rate change
(516,000
)
 
(33,000
)
 
(462,000
)
Tax credits
(610,000
)
 
(390,000
)
 
(100,000
)
Non-deductible 162M compensation limitations
196,000

 
558,000

 
198,000

Non-deductible equity compensation
(687,000
)
 
(418,000
)
 
136,000

Other, net
74,000

 
14,000

 
(783,000
)
Change in valuation allowance
10,622,000

 
3,750,000

 
4,345,000

 
$
(180,000
)
 
$
(12,933,000
)
 
$
1,099,000

Schedule of Deferred Tax Assets and Liabilities 
Deferred income taxes are provided to recognize the effect of temporary differences between tax and financial reporting. Deferred income tax assets and liabilities consist of the following:
 
 
Fiscal Year
 
2014
 
2013
Deferred tax liability:
 
 
 
Intangible asset
$
—

 
$
(141,000
)
       Foreign withholding liability
(1,282,000
)
 
(1,478,000
)
       Foreign unremitted earnings
(2,882,000
)
 
(3,276,000
)
Deferred tax assets:
 
 
 
Federal net operating loss carryforwards
22,758,000

 
15,322,000

State net operating loss carryforwards
1,689,000

 
624,000

Foreign net operating loss carryforwards
2,612,000

 
3,202,000

Equity awards
2,508,000

 
1,666,000

Tax credits
6,267,000

 
5,657,000

Equipment
1,024,000

 
838,000

Investments
5,279,000

 
4,594,000

Other
3,253,000

 
3,365,000

Net deferred tax assets
41,226,000

 
30,373,000

Valuation allowance
(42,508,000
)
 
(31,886,000
)
 
$
(1,282,000
)
 
$
(1,513,000
)
Accrued Warranty (Tables)
Accrued Warranty
Changes in the accrued warranty for fiscal years 2014 and 2013 are as follows:
 
 
Fiscal Year Ended
 
December 27,
2014
 
December 28,
2013
Beginning Balance
$
716,000

 
$
716,000

Additions
389,000

 
798,000

Claim and reversals
(389,000
)
 
(798,000
)
Ending Balance
$
716,000

 
$
716,000

Commintments and Contingencies (Tables)
Schedule of Future Minimum Rental Payments for Operating Leases
The following is a schedule of minimum rental commitments under non-cancelable operating leases at December 27, 2014:
 
Fiscal Year ending,
Amount
2015
$
1,239,000

2016
908,000

2017
665,000

2018
641,000

2019
638,000

Thereafter
2,130,000

Total minimum lease payments
$
6,221,000

Segments and Geographical Information (Tables)
Segments And Geographical Information 
 
Kopin
 
FDD
 
Total
2014
 
 
 
 
 
Revenues
$
28,333

 
$
3,474

 
$
31,807

Net loss attributable to the controlling interest
(26,402
)
 
(1,810
)
 
(28,212
)
Total assets from continuing operations
121,301

 
1,640

 
122,941

Long-lived assets from continuing operations
4,343

 
246

 
4,589

2013
 
 
 
 
 
Revenues
$
19,883

 
$
3,014

 
$
22,898

Net loss attributable to the controlling interest
(2,003
)
 
(2,707
)
 
(4,710
)
Total assets from continuing operations
143,953

 
2,179

 
146,132

Long-lived assets from continuing operations
5,488

 
547

 
6,035

2012
 
 
 
 
 
Revenues
$
31,879

 
$
2,763

 
$
34,642

Net loss attributable to the controlling interest
(17,067
)
 
(4,083
)
 
(21,150
)
Total assets from continuing operations
134,375

 
4,202

 
138,577

Long-lived assets from continuing operations
7,728

 
758

 
8,486

Revenues and Percentage of Revenues by Geographies 
Geographical revenue information for the three years ended December 27, 2014, December 28, 2013 and December 29, 2012 was based on the location of the customers and is as follows:
 
 
Fiscal Year
 
2014
 
2013
 
2012
 
Revenue
 
% of Total
 
Revenue
 
% of Total
 
Revenue
 
% of Total
US
$
19,695,000

 
62
%
 
$
11,927,000

 
53
%
 
$
25,356,000

 
73
%
Other Americas
416,000

 
1
%
 
230,000

 
1
%
 
93,000

 
—
%
Total Americas
20,111,000

 
63
%
 
12,157,000

 
54
%
 
25,449,000

 
73
%
Asia-Pacific
8,245,000

 
26
%
 
8,292,000

 
36
%
 
7,132,000

 
21
%
Europe
3,451,000

 
11
%
 
2,449,000

 
10
%
 
2,061,000

 
6
%
  Total Revenues
31,807,000

 
100
%
 
$
22,898,000

 
100
%
 
$
34,642,000

 
100
%
Long-Lived Assets by Geography 
Long-lived assets by geographic area are as follows:
 
 
Fiscal Years
 
2014
 
2013
United States of America
$
2,689,000

 
$
3,050,000

United Kingdom
377,000

 
795,000

Republic of Korea
1,523,000

 
2,190,000

 
$
4,589,000

 
$
6,035,000

Selected Quarterly Financial Information (Unaudited) (Tables)
Schedule of Quarterly Financial Information
Quarterly Periods During Fiscal Year Ended December 27, 2014:
 
 
Three months ended March 29, 2014
 
Three months
ended
June 28,
2014 (3)
 
Three months ended September 27, 2014
 
Three months
ended
December 27,
2014
 
(In thousands, except per share data)
Revenue
$
4,695

 
$
6,943

 
$
9,532

 
$
10,637

Gross profit (2)
$
2

 
$
753

 
$
3,861

 
$
2,701

Loss from operations
$
(9,614
)
 
$
(7,269
)
 
$
(5,520
)
 
$
(6,073
)
Net loss attributable to the controlling interest
$
(9,134
)
 
$
(8,806
)
 
$
(4,469
)
 
$
(5,302
)
Net loss per share from continuing operations (1):
 
 
 
 
 
 
 
Basic
$
(0.15
)
 
$
(0.14
)
 
$
(0.08
)
 
$
(0.08
)
Diluted
$
(0.15
)
 
$
(0.14
)
 
$
(0.08
)
 
$
(0.08
)
Shares used in computing net loss per share from continuing operations:
 
 
 
 
 
 
 
Basic
62,530

 
62,644

 
62,647

 
62,734

Diluted
62,530

 
62,644

 
62,647

 
62,734

 
(1)
Net loss per share is computed independently for each of the quarters presented; accordingly, the sum of the quarterly net income per share may not equal the total computed for the year.
(2)
Gross profit is defined as net product revenue less cost of product revenues.
(3)
Includes $1.3 million impact in loss from operations and net loss attributable to the controlling interest attributable to the write off of an investment for the three month period ended June 28, 2014, as described in Note 4.
 
Quarterly Periods During Fiscal Year Ended December 28, 2013:
 
 
Three months ended March 30, 2013
 
Three months ended June 29, 2013
 
Three months ended September 28, 2013
 
Three months
ended
December 28,
2013 (3)
 
(In thousands, except per share data)
Revenue
$
6,319

 
$
6,079

 
$
4,950

 
$
5,550

Gross profit (2)
$
(396
)
 
$
(595
)
 
$
267

 
$
645

(Loss) income from continuing operations
$
1,168

 
$
(8,062
)
 
$
(9,015
)
 
$
(9,844
)
Net loss attributable to the controlling interest
$
21,634

 
$
(7,910
)
 
$
(8,771
)
 
$
(9,660
)
Net loss per share from continuing operations (1):
 
 
 
 
 
 
 
Basic
$
0.34

 
$
(0.13
)
 
$
(0.14
)
 
$
(0.16
)
Diluted
$
0.34

 
$
(0.13
)
 
$
(0.14
)
 
$
(0.16
)
Shares used in computing net loss per share from continuing operations:
 
 
 
 
 
 
 
Basic
63,936

 
62,492

 
63,542

 
61,529

Diluted
63,936

 
62,492

 
63,542

 
61,529

 
(1)
Net loss per share is computed independently for each of the quarters presented; accordingly, the sum of the quarterly net income per share may not equal the total computed for the year.
(2)
Gross profit is defined as net component revenue less cost of component revenues.
(3)
Includes $4.0 million impact in loss from continuing operations and net loss attributable to the controlling interest attributable to the impairment of intangibles and write off of investments for the three month period ended December 28, 2013, as described in Notes 4 and 6.
Summary of Significant Accounting Policies (Details) (USD $)
3 Months Ended 12 Months Ended 12 Months Ended 3 Months Ended 12 Months Ended 12 Months Ended 12 Months Ended
Dec. 27, 2014
Sep. 27, 2014
Jun. 28, 2014
Mar. 29, 2014
Dec. 28, 2013
Sep. 28, 2013
Jun. 29, 2013
Mar. 30, 2013
Dec. 27, 2014
Dec. 28, 2013
Dec. 29, 2012
Dec. 31, 2011
Dec. 27, 2014
Non-vested restricted common stock
Dec. 28, 2013
Non-vested restricted common stock
Dec. 29, 2012
Non-vested restricted common stock
Dec. 27, 2014
Stock options
Dec. 28, 2013
Stock options
Dec. 29, 2012
Stock options
Dec. 27, 2014
Minimum
Dec. 27, 2014
Maximum
Dec. 27, 2014
Restricted stock
display_units
Dec. 28, 2013
Restricted stock
Dec. 27, 2014
Phantom stock
Dec. 28, 2013
Phantom stock
Dec. 28, 2013
Restricted stock and phantom stock
Dec. 28, 2013
Kowon
Mar. 14, 2013
Kowon
Dec. 27, 2014
Kowon
Dec. 28, 2013
Kowon
Dec. 27, 2014
Intoware
Dec. 27, 2014
eMDT
Dec. 27, 2014
Accumulated Net Unrealized Investment Gain (Loss)
Dec. 27, 2014
Accumulated Translation Adjustment
Dec. 28, 2013
Scenario, Adjustment
Dec. 29, 2012
Scenario, Adjustment
Dec. 27, 2014
Range One [Member]
Dec. 27, 2014
Range One [Member]
Restricted stock and phantom stock
Dec. 27, 2014
Range Two [Member]
Dec. 27, 2014
Range Two [Member]
Restricted stock and phantom stock
Dec. 27, 2014
Range Three [Member]
Dec. 27, 2014
Range Three [Member]
Restricted stock and phantom stock
Organization, Consolidation and Presentation of Financial Statements Disclosure [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Comprehensive Income (Loss), Net of Tax, Attributable to Parent
 
 
 
 
 
 
 
 
$ (28,527,802)
$ (6,555,083)
$ (15,995,162)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ (0.6)
$ (0.1)
 
 
 
 
 
 
Issuance Of Warrants Shares
 
 
 
 
 
 
 
 
200,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Finite-Lived Intangible Asset, Useful Life
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
3 years 
7 years 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Fiscal Year Duration
 
 
 
 
 
 
 
 
52 weeks 
52 
52 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Kopin's ownership percentage
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
93.00% 
78.00% 
58.00% 
80.00% 
 
 
 
 
 
 
 
 
 
 
Business Combination, Consideration Transferred
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
3,700,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Percentage of voting interests acquired
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
15.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Inventory, Net, Items Net of Reserve Alternative [Abstract]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Raw materials
2,057,202 
 
 
 
1,441,569 
 
 
 
2,057,202 
1,441,569 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Work-in-process
1,551,799 
 
 
 
1,003,540 
 
 
 
1,551,799 
1,003,540 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Finished goods
472,885 
 
 
 
632,946 
 
 
 
472,885 
632,946 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Inventory
4,081,886 
 
 
 
3,078,055 
 
 
 
4,081,886 
3,078,055 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Useful life of property, plant and equipment
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
3 years 
10 years 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Warranty reserves
700,000 
 
 
 
0 
 
 
 
700,000 
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Product warranty claims and reversals
 
 
 
 
 
 
 
 
400,000 
800,000 
2,200,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Asset retirement obligation, beginning balance
 
 
 
329,435 
 
 
 
322,477 
329,435 
322,477 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Accretion
 
 
 
 
 
 
 
 
0 
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Charges
 
 
 
 
 
 
 
 
0 
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Asset Retirement Obligation Increase/Decrease
 
 
 
 
 
 
 
 
(18,248)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Additional liabilities incurred
 
 
 
 
 
 
 
 
 
6,958 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Asset retirement obligation, ending balance
311,187 
 
 
 
329,435 
 
 
 
311,187 
329,435 
322,477 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted Average Number of Shares Outstanding Reconciliation [Abstract]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted-average common shares outstanding - basic (in shares)
62,734,000 
62,647,000 
62,644,000 
62,530,000 
61,529,000 
63,542,000 
62,492,000 
63,936,000 
62,638,675 
62,347,852 
63,617,680 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Stock options and non-vested restricted common stock
 
 
 
 
 
 
 
 
0 
0 
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted average common shares outstanding - diluted (in shares)
62,734,000 
62,647,000 
62,644,000 
62,530,000 
61,529,000 
63,542,000 
62,492,000 
63,936,000 
62,638,675 
62,347,852 
63,617,680 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Antidilutive securities excluded from computation of earnings per share
 
 
 
 
 
 
 
 
2,682,131 
3,582,998 
3,266,728 
 
2,551,631 
3,024,148 
2,283,048 
130,500 
558,850 
983,680 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Nonvested common stock awards employment obligations
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1 year 
 
2 years 
 
4 years 
 
Compensation awards, number of shares of stock granted
 
 
 
 
 
 
 
 
150,000 
 
 
 
 
 
 
 
 
 
 
 
260,000 
260,000 
380,000 
380,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Vesting period following the grant date
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
10 days 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Threshold closing price of common stock for vesting
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 6.00 
 
$ 7.00 
 
$ 5.25 
Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures
 
 
 
 
 
 
 
 
300,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Accumulated Other Comprehensive Income (Loss), Foreign Currency Translation Adjustment, Net of Tax
1,534,075 
 
 
 
2,524,701 
 
 
 
1,534,075 
2,524,701 
3,542,104 
1,319,870 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1,100,000)
 
 
 
 
 
 
 
 
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax, Portion Attributable to Parent
 
 
 
 
 
 
 
 
(990,626)
(1,017,403)
2,222,234 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Accumulated Other Comprehensive Income (Loss), Available-for-sale Securities Adjustment, Net of Tax
1,592,164 
 
 
 
917,296 
 
 
 
1,592,164 
917,296 
2,970,688 
2,826,154 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other Comprehensive Income (Loss), Available-for-sale Securities Adjustment, Net of Tax, Portion Attributable to Parent
 
 
 
 
 
 
 
 
674,868 
(2,053,392)
144,534 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Accumulated Other Comprehensive Income (Loss), Net of Tax
3,126,239 
 
 
 
3,441,997 
 
 
 
3,126,239 
3,441,997 
6,512,792 
4,146,024 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent
 
 
 
 
 
 
 
 
(315,758)
(3,070,795)
2,366,768 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Carrying value of long-lived assets excluding assets held for sale
4,600,000 
 
 
 
 
 
 
 
4,600,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other Comprehensive Income (Loss), Unrealized Holding Gain (Loss) on Securities Arising During Period, Net of Tax
 
 
 
 
 
 
 
 
$ 681,346 
$ (116,134)
$ 730,967 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 700,000 
 
 
 
 
 
 
 
 
 
Market Condition
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
50,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Exercise Price Of Warrants
$ 3.49 
 
 
 
 
 
 
 
$ 3.49 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Discontinued Operations (Details) (USD $)
12 Months Ended 3 Months Ended 12 Months Ended
Dec. 27, 2014
Dec. 28, 2013
Dec. 29, 2012
Jan. 16, 2013
Mar. 30, 2013
III-V product line including all outstanding equity interest in KTC Wireless, LLC
Dec. 28, 2013
III-V product line including all outstanding equity interest in KTC Wireless, LLC
Dec. 29, 2012
III-V product line including all outstanding equity interest in KTC Wireless, LLC
Jan. 16, 2013
III-V product line including all outstanding equity interest in KTC Wireless, LLC
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
 
 
 
 
 
 
 
 
Aggregate purchase price
 
 
 
 
 
 
 
$ 75,000,000 
Business Acquisition, Cost of Acquired Entity, Purchase Price
 
 
 
70,200,000 
 
 
 
 
Proceeds received from divestiture
 
 
 
 
55,200,000 
 
 
 
Consideration to be paid on the third anniversary of the Closing Date
 
 
 
 
 
 
 
15,000,000 
Accounts and Notes Receivable, Net
14,933,335 
14,866,666 
 
14,800,000 
 
 
 
 
Disposal Group, Including Discontinued Operation, Income Statement Disclosures [Abstract]
 
 
 
 
 
 
 
 
Net sales and other operating revenues
 
 
 
 
 
2,300,000 
58,800,000 
 
Income from operations before income taxes
 
 
 
 
 
(200,000)
4,500,000 
 
Provision for income taxes on operations
 
 
 
 
 
0 
(1,700,000)
 
Income from operations, net of tax
 
 
 
 
 
(200,000)
2,800,000 
 
Discontinued Operation, Gain (Loss) on Disposal of Discontinued Operation, Net of Tax
 
 
 
 
 
20,400,000 
0 
 
Income from discontinued operations, net of tax
$ 0 
$ 20,147,532 
$ 2,789,048 
 
 
$ 20,200,000 
$ 2,800,000 
 
Property, Plant and Equipment (Details) (USD $)
12 Months Ended
Dec. 27, 2014
Dec. 28, 2013
Dec. 29, 2012
Property, Plant and Equipment [Line Items]
 
 
 
Gross property, plant and equipment
$ 28,069,293 
$ 29,282,329 
 
Accumulated depreciation and amortization
(23,479,872)
(23,247,366)
 
Net property, plant and equipment
4,589,421 
6,034,963 
 
Depreciation expense
2,600,000 
2,400,000 
3,500,000 
Minimum
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Useful Life
3 years 
 
 
Maximum
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Useful Life
10 years 
 
 
Land
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Gross property, plant and equipment
877,485 
915,595 
 
Buildings
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Gross property, plant and equipment
2,298,367 
2,398,188 
 
Buildings |
Maximum
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Useful Life
10 years 
 
 
Equipment
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Gross property, plant and equipment
19,696,919 
20,993,220 
 
Equipment |
Minimum
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Useful Life
3 years 
 
 
Equipment |
Maximum
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Useful Life
5 years 
 
 
Leasehold improvements
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Gross property, plant and equipment
3,652,395 
3,441,553 
 
Furniture and fixtures
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Gross property, plant and equipment
886,985 
910,270 
 
Furniture and fixtures |
Maximum
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Useful Life
3 years 
 
 
Equipment under construction
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Gross property, plant and equipment
$ 657,142 
$ 623,503 
 
Other Assets and Amounts Due to / Due From Affiliates (Other Assets) (Details) (USD $)
Dec. 27, 2014
Dec. 28, 2013
Jan. 16, 2013
Schedule of Other Assets, Including Investments in Affiliates [Line Items]
 
 
 
Other
$ 219,704 
$ 169,764 
 
Other assets
1,900,828 
3,024,458 
 
Available-for-sale Securities, Fair Value Disclosure
76,223,135 
 
 
Notes, Loans and Financing Receivable, Gross, Noncurrent
 
 
15,000,000 
KoBrite
 
 
 
Schedule of Other Assets, Including Investments in Affiliates [Line Items]
 
 
 
Non-Marketable Securities - Equity Method Investments
 
1,421,592 
 
Vuzix
 
 
 
Schedule of Other Assets, Including Investments in Affiliates [Line Items]
 
 
 
Marketable Securities, Equity Securities
1,500,777 
1,433,102 
 
Available-for-sale Securities, Fair Value Disclosure
1,500,000 
 
 
Available-for-sale Equity Securities, Amortized Cost Basis
 
0 
 
GCS Holdings
 
 
 
Schedule of Other Assets, Including Investments in Affiliates [Line Items]
 
 
 
Marketable Securities, Equity Securities
180,347 
0 
 
Available-for-sale Securities, Fair Value Disclosure
$ 200,000 
 
 
Other Assets and Amounts Due to / Due From Affiliates (Marketable Equity Securities) (Details) (USD $)
12 Months Ended
Dec. 27, 2014
Dec. 28, 2013
Dec. 29, 2012
Equity Method Investments and Joint Ventures [Abstract]
 
 
 
Equity losses in unconsolidated affiliates
$ (386,442)
$ (625,098)
$ (679,587)
Gain on sales of investments
0 
1,899,291 
856,170 
Available-for-sale Securities, Fair Value Disclosure
$ 76,223,135 
 
 
Other Assets and Amounts Due to / Due From Affiliates (Non-Marketable Securities - Equity Method Investments) (Details) (USD $)
3 Months Ended 12 Months Ended 12 Months Ended 9 Months Ended 3 Months Ended 12 Months Ended 3 Months Ended
Dec. 27, 2014
Sep. 27, 2014
Jun. 28, 2014
Mar. 29, 2014
Dec. 28, 2013
Sep. 28, 2013
Jun. 29, 2013
Mar. 30, 2013
Dec. 27, 2014
Dec. 28, 2013
Dec. 29, 2012
Jan. 16, 2013
Dec. 28, 2013
Business Acquisition Two
Dec. 29, 2012
Business Acquisition Two
Sep. 28, 2013
Intoware
Sep. 29, 2012
Intoware
Mar. 30, 2013
Aurisound
Dec. 27, 2014
KoBrite
Dec. 28, 2013
KoBrite
Dec. 29, 2012
KoBrite
Dec. 27, 2014
Intoware
Dec. 28, 2013
Intoware
Dec. 29, 2012
Intoware
Dec. 27, 2014
Ask Ziggy
Dec. 28, 2013
Ask Ziggy
Dec. 29, 2012
Ask Ziggy
Sep. 28, 2013
Deferred Compensation, Share-based Payments [Member]
Founder of Acquired Company [Member]
Mar. 14, 2013
Deferred Compensation, Share-based Payments [Member]
Founder of Acquired Company [Member]
Achievement of Certain Milestones
Mar. 14, 2013
Deferred Compensation, Share-based Payments [Member]
Founder of Acquired Company [Member]
Immediate Vesting
Dec. 28, 2013
GCS [Member]
Dec. 28, 2013
Investee
Ask Ziggy
Schedule of Equity Method Investments [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity losses in unconsolidated affiliates
 
 
 
 
 
 
 
 
$ (386,442)
$ (625,098)
$ (679,587)
 
 
 
 
 
 
$ (102,305)
$ (406,811)
$ (573,265)
$ 0 
$ 0 
$ (106,322)
$ (284,137)
$ (218,287)
$ 0 
 
 
 
 
 
Equity Method Investment, Ownership Percentage
 
 
 
 
 
 
 
 
 
 
 
 
 
 
25.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Available-for-sale Equity Securities, Amortized Cost Basis
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
0 
0 
Payments to Acquire Other Investments
 
 
 
 
 
 
 
 
 
 
 
 
1,600,000 
1,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Purchase price
 
 
 
 
 
 
 
 
 
 
 
 
 
 
700,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Payments to Acquire Interest in Subsidiaries and Affiliates
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2,500,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Ownership percentage
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
58.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Summarized Financial Information
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Current assets
99,924,620 
 
 
 
119,608,002 
 
 
 
99,924,620 
119,608,002 
 
 
 
 
 
 
 
 
7,769,000 
9,581,000 
 
 
 
 
 
 
 
 
 
 
 
Noncurrent assets
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
10,663,000 
12,701,000 
 
 
 
 
 
 
 
 
 
 
 
Current liabilities
13,242,924 
 
 
 
11,239,102 
 
 
 
13,242,924 
11,239,102 
 
 
 
 
 
 
 
 
1,207,000 
1,215,000 
 
 
 
 
 
 
 
 
 
 
 
Revenues
10,637,000 
9,532,000 
6,943,000 
4,695,000 
5,550,000 
4,950,000 
6,079,000 
6,319,000 
31,807,465 
22,897,709 
34,641,860 
 
 
 
 
 
 
 
5,085,000 
6,010,000 
 
 
 
 
 
 
 
 
 
 
 
Margin loss
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(2,501,000)
(2,732,000)
 
 
 
 
 
 
 
 
 
 
 
Loss from operations
 
 
 
 
 
 
 
 
(28,474,725)
(35,927,691)
(20,570,894)
 
 
 
 
 
 
 
(6,114,000)
(4,938,000)
 
 
 
 
 
 
 
 
 
 
 
Net loss
 
 
 
 
 
 
 
 
(28,670,789)
(5,606,016)
(18,994,272)
 
 
 
 
 
 
 
(5,526,000)
(5,308,000)
 
 
 
 
 
 
 
 
 
 
 
Due from Employees, Current
140,000 
 
 
 
 
 
 
 
140,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Consideration transferred
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,800,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Deferred Compensation Arrangement with Individual, Shares Issued
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
400,000 
300,000 
100,000 
 
 
Other than Temporary Impairment Losses, Investments
 
 
 
 
 
 
 
 
2,500,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Notes, Loans and Financing Receivable, Gross, Noncurrent
 
 
 
 
 
 
 
 
 
 
 
$ 15,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business Combinations (Details) (USD $)
12 Months Ended 1 Months Ended 12 Months Ended 1 Months Ended
Dec. 27, 2014
Dec. 28, 2013
Dec. 29, 2012
Apr. 30, 2013
eMDT
Dec. 28, 2013
eMDT
Apr. 17, 2013
eMDT
Apr. 30, 2013
Noncontrolling Interest
Business Acquisition Two
Dec. 27, 2014
eMDT
Business Acquisition [Line Items]
 
 
 
 
 
 
 
 
Cumulative percentage of voting interests acquired
 
 
 
51.00% 
 
 
 
 
Business Combination, Consideration Transferred
 
 
 
$ 400,000 
 
 
 
 
Kopin's ownership percentage
 
 
 
 
 
 
 
80.00% 
Payments to Acquire Investments
0 
3,583,611 
2,249,784 
 
 
 
200,000 
 
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Less Noncontrolling Interest [Abstract]
 
 
 
 
 
 
 
 
Goodwill
976,451 
1,016,132 
684,789 
 
 
400,000 
 
 
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Changes, Additional Interest Issued to Parent
0.29 
 
 
 
 
 
 
 
Net loss included in consolidated operations
 
 
 
 
$ 300,000 
 
 
 
Goodwill and Intangibles (Details) (USD $)
12 Months Ended 3 Months Ended 12 Months Ended 3 Months Ended
Dec. 27, 2014
Dec. 28, 2013
Dec. 29, 2012
Dec. 27, 2014
Customer relationships
Dec. 27, 2014
Developed technology
Dec. 27, 2014
Trademark portfolio
Dec. 28, 2013
FDD
Dec. 27, 2014
FDD
Dec. 28, 2013
Intoware
Schedule of Finite-Lived Intangible Assets and Goodwill [Line Items]
 
 
 
 
 
 
 
 
 
Other Intangible Assets, Net
$ 616,759 
 
 
 
 
 
 
 
 
Impairment of Intangible Assets (Excluding Goodwill)
 
 
 
 
 
 
1,200,000 
 
300,000 
Goodwill [Roll Forward]
 
 
 
 
 
 
 
 
 
Beginning Balance
1,016,132 
684,789 
 
 
 
 
 
 
 
Additions
 
395,713 
 
 
 
 
 
 
 
Disposals
(39,681)
(64,370)
 
 
 
 
 
 
 
Ending Balance
976,451 
1,016,132 
684,789 
 
 
 
 
 
 
Goodwill impairment charge
 
 
 
 
 
 
 
1,700,000 
 
Useful life of identifiable intangible assets
 
 
 
7 years 
7 years 
7 years 
 
 
 
Amortization of intangible assets due in next twelve months
$ 1,000,000 
$ 300,000 
$ 300,000 
 
 
 
 
 
 
Financial Instruments (Fair Value Measurements) (Details) (USD $)
12 Months Ended
Dec. 28, 2013
Dec. 27, 2014
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale Debt Securities, Accumulated Gross Unrealized Gain, before Tax
$ 0 
$ 0 
Available-for-sale Debt Securities, Accumulated Gross Unrealized Loss, before Tax
(765,483)
(239,602)
Fair value measurements of financial assets
114,162,303 
92,540,061 
Goodwill, Acquired During Period
395,713 
 
Money Markets and Cash Equivalents
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value measurements of financial assets
16,756,666 
14,635,802 
U.S. Government Securities
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value measurements of financial assets
68,284,392 
57,697,142 
Corporate Debt
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value measurements of financial assets
12,984,331 
5,970,983 
Certificates of Deposit
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value measurements of financial assets
14,703,812 
12,555,010 
Vuzix
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value measurements of financial assets
1,433,102 
1,500,777 
GCS Holdings
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value measurements of financial assets
 
180,347 
Level 1
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value measurements of financial assets
34,731,771 
37,535,266 
Level 1 |
Money Markets and Cash Equivalents
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value measurements of financial assets
16,756,666 
14,635,802 
Level 1 |
U.S. Government Securities
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value measurements of financial assets
16,542,003 
21,218,340 
Level 1 |
Vuzix
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value measurements of financial assets
1,433,102 
1,500,777 
Level 1 |
GCS Holdings
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value measurements of financial assets
 
180,347 
Level 2
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value measurements of financial assets
79,430,532 
55,004,795 
Level 2 |
U.S. Government Securities
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value measurements of financial assets
51,742,389 
36,478,802 
Level 2 |
Corporate Debt
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value measurements of financial assets
12,984,331 
5,970,983 
Level 2 |
Certificates of Deposit
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value measurements of financial assets
14,703,812 
12,555,010 
Level 2 |
Vuzix
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value measurements of financial assets
0 
0 
Level 2 |
GCS Holdings
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value measurements of financial assets
 
0 
Level 3
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value measurements of financial assets
0 
0 
Level 3 |
Money Markets and Cash Equivalents
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value measurements of financial assets
0 
0 
Level 3 |
U.S. Government Securities
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value measurements of financial assets
0 
0 
Level 3 |
Corporate Debt
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value measurements of financial assets
0 
0 
Level 3 |
Certificates of Deposit
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value measurements of financial assets
0 
0 
Level 3 |
Vuzix
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value measurements of financial assets
0 
0 
Level 3 |
GCS Holdings
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value measurements of financial assets
 
0 
Corporate Debt Securities And Certificates Of Deposit [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Available-for-sale Debt Securities, Accumulated Gross Unrealized Gain, before Tax
0 
0 
Available-for-sale Debt Securities, Accumulated Gross Unrealized Loss, before Tax
$ (79,370)
$ (38,830)
Financial Instruments (Marketable Debt Securities) (Details) (USD $)
Dec. 27, 2014
Dec. 28, 2013
Schedule of Available-for-sale Securities [Line Items]
 
 
Available-for-sale Debt Securities, Accumulated Gross Unrealized Loss, before Tax
$ (239,602)
$ (765,483)
Amortized Cost
76,462,737 
96,738,018 
Available-for-sale Debt Securities, Accumulated Gross Unrealized Gain, before Tax
0 
0 
Available-for-sale Securities, Debt Securities
76,223,135 
95,972,535 
Fair Value
76,223,135 
 
Less than One year
30,502,703 
 
One to Five years
37,229,175 
 
Greater than Five years
8,491,257 
 
U.S. government and agency backed securities
 
 
Schedule of Available-for-sale Securities [Line Items]
 
 
Available-for-sale Debt Securities, Accumulated Gross Unrealized Loss, before Tax
(200,772)
(686,113)
Amortized Cost
57,897,914 
68,970,505 
Available-for-sale Debt Securities, Accumulated Gross Unrealized Gain, before Tax
0 
0 
Available-for-sale Securities, Debt Securities
57,697,142 
 
Fair Value
57,697,142 
68,284,392 
Less than One year
14,618,790 
 
One to Five years
35,548,345 
 
Greater than Five years
7,530,007 
 
Corporate Debt Securities And Certificates Of Deposit [Member]
 
 
Schedule of Available-for-sale Securities [Line Items]
 
 
Available-for-sale Debt Securities, Accumulated Gross Unrealized Loss, before Tax
(38,830)
(79,370)
Amortized Cost
18,564,823 
27,767,513 
Available-for-sale Debt Securities, Accumulated Gross Unrealized Gain, before Tax
0 
0 
Available-for-sale Securities, Debt Securities
18,525,993 
27,688,143 
Fair Value
18,525,993 
 
Less than One year
15,883,913 
 
One to Five years
1,680,830 
 
Greater than Five years
$ 961,250 
 
Stockholders' Equity and Stock-Based Compensation (Details) (USD $)
12 Months Ended 12 Months Ended
Dec. 27, 2014
Mar. 30, 2013
Dec. 31, 2001
Supplemental Equity Plan 2001 [Member]
Dec. 31, 2001
2001 Equity Plan
Dec. 27, 2014
2001 Equity Plan
Dec. 27, 2014
2010 Equity Plan
Dec. 27, 2014
2010 Equity Plan
Stock options
Dec. 27, 2014
2010 Equity Plan
Stock options
Minimum
Dec. 27, 2014
Period 2
Unvested Restricted Stock Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Award Requisite Service Period
 
 
 
 
 
 
 
 
2 years 
Authorized stock repurchase amount
 
$ 30,000,000 
 
 
 
 
 
 
 
Number of shares repurchased since inception
2,241,121 
 
 
 
 
 
 
 
 
Value of shares repurchased since inception
$ 8,290,573 
 
 
 
 
 
 
 
 
Number of shares authorized
 
 
 
7,100,000 
 
 
 
 
 
Life of award
 
 
10 years 
10 years 
 
 
10 years 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Number of Additional Shares Authorized
 
 
 
 
 
1,900,000.0 
 
 
 
Number of shares that may be issued
 
 
0 
 
0 
3,000,000 
 
 
 
Purchase price of common stock under equity plans as percent of fair value at the grant date
 
 
 
 
 
 
110.00% 
100.00% 
 
Stockholders' Equity and Stock-Based Compensation (Stock Options) (Details) (USD $)
12 Months Ended
Dec. 27, 2014
Dec. 28, 2013
Dec. 29, 2012
Dec. 31, 2011
Dec. 26, 2009
Jun. 30, 2010
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
 
 
 
 
 
 
Range of Exercise Prices, Lower Limit
$ 3.15 
 
 
 
 
 
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Upper Range Limit
$ 3.87 
 
 
 
 
 
Shares
 
 
 
 
 
 
Beginning Balance
558,850 
 
 
 
 
 
Options forfeited/cancelled
(391,600)
 
 
 
 
 
Options exercised
36,750 
 
 
 
 
 
Ending Balance
130,500 
558,850 
 
 
 
 
Weighted Average Exercise Price
 
 
 
 
 
 
Beginning Balance
$ 5.09 
 
 
 
 
 
Options forfeited/cancelled
$ 5.75 
 
 
 
 
 
Options exercised
$ 3.75 
 
 
 
 
 
Ending Balance
$ 3.49 
$ 5.09 
 
 
 
 
Exercisable, end of year
130,500 
 
 
 
 
 
Number of options issued in period
0 
0 
0 
 
 
 
Intrinsic value of options exercised
$ 26,000 
$ 0 
 
 
$ 0 
 
Number of securities called by warrants
 
 
 
 
 
200,000 
Exercise price of warrants
$ 3.49 
 
 
 
 
 
Cash received from option exercises
137,813 
0 
0 
0 
 
 
Tax benefits realized
$ 0 
$ 0 
$ 0 
 
 
 
Stockholders' Equity and Stock-Based Compensation (Stock Options - Outstanding and Exercisable) (Details) (USD $)
12 Months Ended
Dec. 27, 2014
Dec. 28, 2013
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
 
 
Exercisable, end of year
130,500 
 
Range of Exercise Prices, Lower Limit
$ 3.15 
 
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Upper Range Limit
$ 3.87 
 
Number Outstanding
130,500 
558,850 
Weighted Average Exercise Price
$ 3.49 
$ 5.09 
Options Outstanding - Aggregate intrinsic value on December 29, 2012
$ 13,000 
 
Stockholders' Equity and Stock-Based Compensation (Nonvested Restricted Common Stock) (Details) (USD $)
In Millions, except Share data, unless otherwise specified
12 Months Ended
Dec. 27, 2014
Dec. 28, 2013
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures
50,000 
 
Shares
 
 
Granted
150,000 
 
Non-vested restricted common stock
 
 
Shares
 
 
Beginning Balance
2,974,148 
 
Granted
523,000 
 
Forfeited
(102,400)
 
Vested
(843,117)
 
Ending Balance
2,551,631 
 
Weighted Average Grant Fair Value
 
 
Beginning Balance
$ 4.25 
 
Granted
$ 4.01 
 
Forfeited
$ 3.33 
 
Vested
$ 3.73 
 
Ending Balance
$ 4.41 
 
Restricted stock
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized
$ 3.5 
 
Shares
 
 
Granted
260,000 
260,000 
Period 1 |
Non-vested restricted common stock
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
Nonvested common stock awards employment obligations
1 year 
 
Period 2 |
Non-vested restricted common stock
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
Nonvested common stock awards employment obligations
2 years 
 
Period 3 |
Non-vested restricted common stock
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
Nonvested common stock awards employment obligations
4 years 
 
Stockholders' Equity and Stock-Based Compensation (Stock-Based Compensation) (Details) (USD $)
12 Months Ended
Dec. 27, 2014
Dec. 28, 2013
Dec. 29, 2012
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
 
 
 
Stock-based compensation
$ 4,827,772 
$ 4,203,408 
$ 4,486,990 
Cost of product revenues
 
 
 
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
 
 
 
Stock-based compensation
766,221 
414,842 
513,789 
Research and development
 
 
 
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
 
 
 
Stock-based compensation
965,945 
423,548 
366,443 
Selling, general and administrative
 
 
 
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
 
 
 
Stock-based compensation
3,095,606 
3,365,018 
3,606,758 
Restricted stock
 
 
 
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
 
 
 
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized
$ 3,500,000 
 
 
Concentrations of Risk (Details)
12 Months Ended
Dec. 27, 2014
Dec. 28, 2013
Dec. 29, 2012
Percent of Gross Accounts Receivable |
Credit concentration risk |
Company A
 
 
 
Concentration Risk [Line Items]
 
 
 
Concentrations of risk, percentage
1.00% 
22.00% 
 
Percent of Gross Accounts Receivable |
Credit concentration risk |
Company E
 
 
 
Concentration Risk [Line Items]
 
 
 
Concentrations of risk, percentage
14.00% 
 
 
Percent of Gross Accounts Receivable |
Credit concentration risk |
Company B
 
 
 
Concentration Risk [Line Items]
 
 
 
Concentrations of risk, percentage
5.00% 
12.00% 
 
Percent of Gross Accounts Receivable |
Credit concentration risk |
Company C
 
 
 
Concentration Risk [Line Items]
 
 
 
Concentrations of risk, percentage
9.00% 
12.00% 
 
Percent of Gross Accounts Receivable |
Credit concentration risk |
Company D
 
 
 
Concentration Risk [Line Items]
 
 
 
Concentrations of risk, percentage
32.00% 
 
 
Percent of Gross Accounts Receivable |
Credit concentration risk |
Company F [Member]
 
 
 
Concentration Risk [Line Items]
 
 
 
Concentrations of risk, percentage
8.00% 
 
 
Sales as a Percent of Total Revenue |
Customer concentration risk |
Company A
 
 
 
Concentration Risk [Line Items]
 
 
 
Concentrations of risk, percentage
 
18.00% 
12.00% 
Sales as a Percent of Total Revenue |
Customer concentration risk |
Military Customers in Total
 
 
 
Concentration Risk [Line Items]
 
 
 
Concentrations of risk, percentage
45.00% 
38.00% 
57.00% 
Sales as a Percent of Total Revenue |
Customer concentration risk |
Company E
 
 
 
Concentration Risk [Line Items]
 
 
 
Concentrations of risk, percentage
 
 
21.00% 
Sales as a Percent of Total Revenue |
Customer concentration risk |
Company C
 
 
 
Concentration Risk [Line Items]
 
 
 
Concentrations of risk, percentage
11.00% 
 
 
Sales as a Percent of Total Revenue |
Customer concentration risk |
Company D
 
 
 
Concentration Risk [Line Items]
 
 
 
Concentrations of risk, percentage
26.00% 
13.00% 
22.00% 
Sales as a Percent of Total Revenue |
United States Government Funded Research and Development Contracts
 
 
 
Concentration Risk [Line Items]
 
 
 
Concentrations of risk, percentage
4.00% 
7.00% 
10.00% 
Income Taxes (Details) (USD $)
3 Months Ended 12 Months Ended
Mar. 14, 2013
Dec. 27, 2014
Dec. 28, 2013
Dec. 29, 2012
Current:
 
 
 
 
Federal
 
$ 0 
$ (13,124,000)
$ 0 
State
 
50,000 
12,000 
64,000 
Foreign
1,300,000 
0 
(34,000)
0 
Total current provision
 
50,000 
(13,146,000)
64,000 
Deferred:
 
 
 
 
Federal
 
(9,554,000)
(3,616,000)
(2,878,000)
State
 
(1,709,000)
644,000 
(505,000)
Foreign
 
411,000 
(565,000)
73,000 
Change in valuation allowance
 
10,622,000 
3,750,000 
4,345,000 
Total deferred provision
 
(230,000)
213,000 
1,035,000 
Total (benefit) provision for income taxes
 
(180,000)
(12,933,209)
1,099,000 
Income Tax Expense (Benefit), Continuing Operations, Income Tax Reconciliation [Abstract]
 
 
 
 
Tax provision at federal statutory rates
 
(9,964,000)
(13,322,000)
(7,002,000)
State tax liability
 
33,000 
8,000 
42,000 
Foreign deferred
 
371,000 
(644,000)
734,000 
Foreign withholding
 
(196,000)
308,000 
1,170,000 
Outside basis in KTC and Kowon, net
 
(394,000)
(202,000)
2,422,000 
Goodwill
 
0 
0 
417,000 
Non-deductible expenses
 
(21,000)
306,000 
(18,000)
Increase in net state operating loss carryforwards
 
(177,000)
(2,868,000)
0 
Utilization of NOL for R&D refund
 
1,089,000 
0 
0 
Provision to tax return adjustments and state tax rate change
 
(516,000)
(33,000)
(462,000)
Tax credits
 
(610,000)
(390,000)
(100,000)
Effective Income Tax Rate Reconciliation, Deduction, Amount
 
196,000 
558,000 
198,000 
Non-deductible equity compensation
 
(687,000)
(418,000)
136,000 
Other, net
 
74,000 
14,000 
(783,000)
Change in valuation allowance
 
10,622,000 
3,750,000 
4,345,000 
Total (benefit) provision for income taxes
 
(180,000)
(12,933,209)
1,099,000 
Pretax foreign (losses) earnings
 
(2,588,000)
(4,966,000)
(6,870,000)
Deferred tax liability:
 
 
 
 
Intangible asset
 
0 
(141,000)
 
Foreign withholding liability
 
(1,282,000)
(1,478,000)
 
Foreign unremitted earnings
 
(2,882,000)
(3,276,000)
 
Deferred Tax assets:
 
 
 
 
Federal net operating loss carryforwards
 
22,758,000 
15,322,000 
 
State net operating loss carryforwards
 
1,689,000 
624,000 
 
Foreign net operating loss carryforwards
 
2,612,000 
3,202,000 
 
Equity awards
 
2,508,000 
1,666,000 
 
Tax credits
 
6,267,000 
5,657,000 
 
Equipment
 
1,024,000 
838,000 
 
Investments
 
5,279,000 
4,594,000 
 
Other
 
3,253,000 
3,365,000 
 
Net deferred tax assets
 
41,226,000 
30,373,000 
 
Valuation allowance
 
(42,508,000)
(31,886,000)
 
Net deferred tax assets after deducting valuation allowance
 
(1,282,000)
(1,513,000)
 
Increase (decrease) in valuation allowance
 
10,600,000 
 
 
Unrecorded benefits from stock award
 
10,300,000 
 
 
Deferred Tax Liabilities, Parent's Basis in Discontinued Operation
 
2,900,000 
 
 
Income Tax Expense (Benefit)
 
(180,000)
(12,933,209)
1,099,000 
Maximum
 
 
 
 
Deferred Tax assets:
 
 
 
 
The state impact of any federal changes, subject to examination by various states (in years)
 
1 year 
 
 
Segments excluding KTC
 
 
 
 
Deferred Tax assets:
 
 
 
 
Increase (decrease) in valuation allowance
 
 
3,700,000 
 
Utiilzation of operating loss carryforwards
 
 
8,600,000 
 
International jurisdictions |
Minimum
 
 
 
 
Deferred Tax assets:
 
 
 
 
Income tax returns examination period
 
3 years 
 
 
International jurisdictions |
Maximum
 
 
 
 
Deferred Tax assets:
 
 
 
 
Income tax returns examination period
 
7 years 
 
 
Federal
 
 
 
 
Deferred Tax assets:
 
 
 
 
Net operating loss carryforwards available for tax purposes
 
$ 65,000,000 
 
 
State |
Minimum
 
 
 
 
Deferred Tax assets:
 
 
 
 
Income tax returns examination period
 
3 years 
 
 
State |
Maximum
 
 
 
 
Deferred Tax assets:
 
 
 
 
Income tax returns examination period
 
5 years 
 
 
Accrued Warranty (Details) (USD $)
12 Months Ended
Dec. 27, 2014
Dec. 28, 2013
Product Warranties Disclosures [Abstract]
 
 
Product warranty term
12 months 
 
Movement in Standard Product Warranty Accrual [Roll Forward]
 
 
Beginning Balance
$ 716,000 
$ 716,000 
Additions
389,000 
798,000 
Claims and reversals
(389,000)
(798,000)
Ending Balance
$ 716,000 
$ 716,000 
Employee Benefit Plan (Details) (USD $)
12 Months Ended
Dec. 27, 2014
Dec. 28, 2013
Dec. 29, 2012
Schedule of Benefit Plans Disclosure [Line Items]
 
 
 
Employee age threshhold for higher annual contribution
50 years 
 
 
Employer matching percentage
50.00% 
 
 
Maximum amount of employee contribution that employer matches
6.00% 
 
 
Amount charged to operations in connection with the plan
$ 224,000 
$ 146,000 
$ 210,000 
Under the age of 50
 
 
 
Schedule of Benefit Plans Disclosure [Line Items]
 
 
 
Maximum amount of annual compensation that can be deferred
17,500 
 
 
Over the age fo 50
 
 
 
Schedule of Benefit Plans Disclosure [Line Items]
 
 
 
Maximum amount of annual compensation that can be deferred
$ 23,000 
 
 
Commintments and Contingencies (Details) (USD $)
12 Months Ended
Dec. 27, 2014
Dec. 28, 2013
Dec. 29, 2012
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract]
 
 
 
2015
$ 1,239,000 
 
 
2016
908,000 
 
 
2017
665,000 
 
 
2018
641,000 
 
 
2019
638,000 
 
 
Thereafter
2,130,000 
 
 
Total minimum lease payments
6,221,000 
 
 
Rent expense
1,700,000 
1,300,000 
800,000 
Royalty expense
37,000 
20,000 
18,000 
Proceeds from Grantors
$ 3,000,000 
 
 
Segments and Geographical Information (Details) (USD $)
3 Months Ended 12 Months Ended
Dec. 27, 2014
Sep. 27, 2014
Jun. 28, 2014
Mar. 29, 2014
Dec. 28, 2013
Sep. 28, 2013
Jun. 29, 2013
Mar. 30, 2013
Dec. 27, 2014
Dec. 28, 2013
Dec. 29, 2012
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenues
$ 10,637,000 
$ 9,532,000 
$ 6,943,000 
$ 4,695,000 
$ 5,550,000 
$ 4,950,000 
$ 6,079,000 
$ 6,319,000 
$ 31,807,465 
$ 22,897,709 
$ 34,641,860 
Net income (loss) income attributable to the controlling interest
(5,302,000)
(4,469,000)
(8,806,000)
(9,134,000)
(9,660,000)1
(8,771,000)
(7,910,000)
21,634,000 
(28,212,044)
(4,709,616)
(18,361,930)
Total assets from continuing operations
122,941,414 
 
 
 
146,131,723 
 
 
 
122,941,414 
146,131,723 
 
Long lived assets
4,589,000 
 
 
 
6,035,000 
 
 
 
4,589,000 
6,035,000 
 
Continuing Operations
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Net income (loss) income attributable to the controlling interest
 
 
 
 
 
 
 
 
(28,212,000)
(4,710,000)
(21,150,000)
Total assets from continuing operations
122,941,000 
 
 
 
146,132,000 
 
 
 
122,941,000 
146,132,000 
138,577,000 
Long lived assets
4,589,000 
 
 
 
6,035,000 
 
 
 
4,589,000 
6,035,000 
8,486,000 
Kopin U.S.
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenues
 
 
 
 
 
 
 
 
28,333,000 
19,883,000 
31,879,000 
Kopin U.S. |
Continuing Operations
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Net income (loss) income attributable to the controlling interest
 
 
 
 
 
 
 
 
(26,402,000)
(2,003,000)
(17,067,000)
Total assets from continuing operations
121,301,000 
 
 
 
143,953,000 
 
 
 
121,301,000 
143,953,000 
134,375,000 
Long lived assets
4,343,000 
 
 
 
5,488,000 
 
 
 
4,343,000 
5,488,000 
7,728,000 
FDD
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenues
 
 
 
 
 
 
 
 
3,474,000 
3,014,000 
2,763,000 
FDD |
Continuing Operations
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Net income (loss) income attributable to the controlling interest
 
 
 
 
 
 
 
 
(1,810,000)
(2,707,000)
(4,083,000)
Total assets from continuing operations
1,640,000 
 
 
 
2,179,000 
 
 
 
1,640,000 
2,179,000 
4,202,000 
Long lived assets
$ 246,000 
 
 
 
$ 547,000 
 
 
 
$ 246,000 
$ 547,000 
$ 758,000 
Segments and Geographical Information (Percentage of Net Revenues by Geographies) (Details) (USD $)
3 Months Ended 12 Months Ended
Dec. 27, 2014
Sep. 27, 2014
Jun. 28, 2014
Mar. 29, 2014
Dec. 28, 2013
Sep. 28, 2013
Jun. 29, 2013
Mar. 30, 2013
Dec. 27, 2014
Dec. 28, 2013
Dec. 29, 2012
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenues
$ 10,637,000 
$ 9,532,000 
$ 6,943,000 
$ 4,695,000 
$ 5,550,000 
$ 4,950,000 
$ 6,079,000 
$ 6,319,000 
$ 31,807,465 
$ 22,897,709 
$ 34,641,860 
Percent of Total
 
 
 
 
 
 
 
 
100.00% 
100.00% 
100.00% 
Long lived assets
4,589,000 
 
 
 
6,035,000 
 
 
 
4,589,000 
6,035,000 
 
United States of America
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenues
 
 
 
 
 
 
 
 
19,695,000 
11,927,000 
25,356,000 
Percent of Total
 
 
 
 
 
 
 
 
62.00% 
53.00% 
73.00% 
Long lived assets
2,689,000 
 
 
 
3,050,000 
 
 
 
2,689,000 
3,050,000 
 
Others
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenues
 
 
 
 
 
 
 
 
416,000 
230,000 
93,000 
Percent of Total
 
 
 
 
 
 
 
 
1.00% 
1.00% 
0.00% 
Americas
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenues
 
 
 
 
 
 
 
 
20,111,000 
12,157,000 
25,449,000 
Percent of Total
 
 
 
 
 
 
 
 
63.00% 
54.00% 
73.00% 
Asia-Pacific
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenues
 
 
 
 
 
 
 
 
8,245,000 
8,292,000 
7,132,000 
Percent of Total
 
 
 
 
 
 
 
 
26.00% 
36.00% 
21.00% 
Europe
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenues
 
 
 
 
 
 
 
 
3,451,000 
2,449,000 
2,061,000 
Percent of Total
 
 
 
 
 
 
 
 
11.00% 
10.00% 
6.00% 
United Kingdom
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Long lived assets
377,000 
 
 
 
795,000 
 
 
 
377,000 
795,000 
 
Republic of Korea
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Long lived assets
$ 1,523,000 
 
 
 
$ 2,190,000 
 
 
 
$ 1,523,000 
$ 2,190,000 
 
Selected Quarterly Financial Information (Unaudited) (Details) (USD $)
3 Months Ended 12 Months Ended
Dec. 27, 2014
Sep. 27, 2014
Jun. 28, 2014
Mar. 29, 2014
Dec. 28, 2013
Sep. 28, 2013
Jun. 29, 2013
Mar. 30, 2013
Dec. 27, 2014
Dec. 28, 2013
Dec. 29, 2012
Effect of Fourth Quarter Events [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenues
$ 10,637,000 
$ 9,532,000 
$ 6,943,000 
$ 4,695,000 
$ 5,550,000 
$ 4,950,000 
$ 6,079,000 
$ 6,319,000 
$ 31,807,465 
$ 22,897,709 
$ 34,641,860 
Gross profit
2,701,000 1
3,861,000 1
753,000 1
2,000 1
645,000 1 2
267,000 1
(595,000)1
(396,000)1
 
 
 
(Loss) income from continuing operations
(6,073,000)
(5,520,000)
(7,269,000)
(9,614,000)
(9,844,000)
(9,015,000)
(8,062,000)
1,168,000 
(28,670,789)
(25,753,548)
(21,783,320)
Net income (loss) attributable to the controlling interest
(5,302,000)
(4,469,000)
(8,806,000)
(9,134,000)
(9,660,000)2
(8,771,000)
(7,910,000)
21,634,000 
(28,212,044)
(4,709,616)
(18,361,930)
Net (loss) income per share:
 
 
 
 
 
 
 
 
 
 
 
Basic (in dollars per share)
$ (0.08)3
$ (0.08)3
$ (0.14)3
$ (0.15)3
$ (0.16)3
$ (0.14)3
$ (0.13)3
$ 0.34 3
$ (0.45)
$ (0.08)
$ (0.29)
Diluted (in dollars per share)
$ (0.08)3
$ (0.08)3
$ (0.14)3
$ (0.15)3
$ (0.16)3
$ (0.14)3
$ (0.13)3
$ 0.34 3
$ (0.45)
$ (0.08)
$ (0.29)
Shares used in computing net income per share:
 
 
 
 
 
 
 
 
 
 
 
Basic (in shares)
62,734,000 
62,647,000 
62,644,000 
62,530,000 
61,529,000 
63,542,000 
62,492,000 
63,936,000 
62,638,675 
62,347,852 
63,617,680 
Diluted (in shares)
62,734,000 
62,647,000 
62,644,000 
62,530,000 
61,529,000 
63,542,000 
62,492,000 
63,936,000 
62,638,675 
62,347,852 
63,617,680 
Scenario, Adjustment [Member]
 
 
 
 
 
 
 
 
 
 
 
Effect of Fourth Quarter Events [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Other Asset Impairment Charges
 
 
 
 
$ 1,300,000 
 
 
 
 
$ 4,000,000 
 
Schedule II - Valuation and Qualifying Accounts (Details) (Reserve deducted from assets - allowance for doubtful accounts, USD $)
12 Months Ended
Dec. 27, 2014
Dec. 28, 2013
Dec. 29, 2012
Dec. 26, 2009
Reserve deducted from assets - allowance for doubtful accounts
 
 
 
 
Valuation and Qualifying Accounts Disclosure [Line Items]
 
 
 
 
Balance at Beginning of Year
$ 202,000 
$ 311,000 
 
$ 513,000 
Additions Charged to Income
81,000 
19,000 
139,000 
 
Deductions from Reserve
(17,000)
(128,000)
(341,000)
 
Balance at End of Year
$ 266,000 
$ 202,000 
$ 311,000 
$ 513,000