10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the year ended December 31, 2015

or

[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____________________ to ___________________________

Commission file number 0-8771

EVANS & SUTHERLAND COMPUTER CORPORATION

(Exact name of registrant as specified in its charter)

Utah	87-0278175
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)
770 Komas Drive, Salt Lake City, Utah	84108
(Address of principal executive offices)	(Zip Code)

Registrant's telephone number, including area code: 801-588-1000

Securities registered pursuant to Section 12(b) of the Act:

NONE

Securities registered pursuant to Section 12(g) of the Act:

Title of Each Class

Common Stock, $0.20 par value

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. [  ] Yes  [ x ] No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act.  [ ] Yes  [ x ] No

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.       [ x ] Yes       [  ] No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). [ x ] Yes  [  ] No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.[x]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company.  See definition of "large accelerated filer", "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

 Large accelerated filer [  ]           Accelerated filer [  ]                         Non-accelerated filer [  ]                       Smaller reporting company [x]       (Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Act).  [  ] Yes    [ x ] No

The aggregate market value of the voting and non-voting common stock of the registrant held by non-affiliates of the registrant as of July 2, 2015 the last business day of the registrant's most recently completed second fiscal quarter was $4,149,143 based on the closing sale price of $0.65 as reported by the Over-the-Counter Market. Shares of common stock held by each executive officer and director and by each person who owns 5% or more of the outstanding common stock, based on Schedule 13D and 13G filings, have been excluded since such persons may be deemed affiliates. This determination of affiliate status is not necessarily a conclusive determination of affiliate status for other purposes.

The number of shares of the registrant's Common Stock outstanding as of March 1, 2016 was 11,177,316.

DOCUMENTS INCORPORATED BY REFERENCE:

Certain information from the Registrant's definitive proxy statement for the 2016 Annual Meeting of Stockholders is incorporated by reference into Part III hereof.

EVANS & SUTHERLAND COMPUTER CORPORATION

FORM 10-K

FOR THE YEAR ENDED DECEMBER 31, 2015

PART I
ITEM 1.	BUSINESS	3
ITEM 2.	PROPERTIES	6
ITEM 3.	LEGAL PROCEEDINGS	6
ITEM 4.	MINE SAFETY DISCLOSURES	6
PART II
ITEM 5.	MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES	7
ITEM 6.	CONSOLIDATED FINANCIAL DATA	7
ITEM 7.	MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	8
ITEM 8.	FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA	18
ITEM 9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE	42
ITEM 9A.	CONTROLS AND PROCEDURES	42
ITEM 9B.	OTHER INFORMATION	42
PART III
ITEM 10.	DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE	43
ITEM 11.	EXECUTIVE COMPENSATION	43
ITEM 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS	44
ITEM 13.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE	44
ITEM 14.	PRINCIPAL ACCOUNTANT FEES AND SERVICES	44
PART IV
ITEM 15.	EXHIBITS AND FINANCIAL STATEMENT SCHEDULES	45
SIGNATURES		49

2

PART I

ITEM 1.  BUSINESS

Throughout this document Evans & Sutherland Computer Corporation may be referred to as "Evans & Sutherland," "E&S," "we," "us," "our" or the "Company."  All dollar amounts are in thousands unless otherwise indicated.

Evans & Sutherland was incorporated in the state of Utah on May 10, 1968.  Our principal offices are located at 770 Komas Drive, Salt Lake City, Utah 84108, and our telephone number is (801) 588-1000.  Through a link on our website, www.es.com, we make available, free of charge, our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 ("Exchange Act") as soon as reasonably practicable after such material is electronically filed with or furnished to the Securities and Exchange Commission (the "SEC").  We make our website content available for informational purposes only.  The information provided on our website is not incorporated by reference into this Form 10-K and our website address is not intended to be a hyperlink.  The above reports and other information are also available, free of charge, at www.sec.gov.  Alternatively, the public may read and copy any materials we file with the SEC at the SEC's Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549.  Information on the operation of the Public Reference Room may be obtained by calling the SEC at 1-800-SEC-0330.

General

Evans & Sutherland focuses on the production of high-quality advanced visual display systems used primarily in full-dome video projection applications, dome projection screens, dome architectural treatments, and unique content for planetariums, schools, science centers, other educational institutions, and entertainment venues.  With a nearly 50-year history in computer graphics, we are widely regarded as both a pioneer and a leader in providing the world's most compelling full-dome digital theater and planetarium systems as well as original full-dome shows.  With our subsidiary, Spitz, Inc. ("Spitz"), and its over 60-year history as a leading supplier of planetarium systems, dome projection screens and other dome displays, E&S supplies premier total system solutions for its digital theater markets as well as customized domes and other unique geometric structures in the architectural market.

We continue to maintain a significant share of the overall planetarium and digital theater market. We estimate that our market share has ranged from 35% to 70%, depending on the specific market and time period.  We estimate that the size of the market for digital theater and planetarium systems is approximately $65 million annually. 

Description of Products

E&S offers a range of products and services primarily for dome and planetarium theaters in educational institutions, training, and entertainment venues.  These products include state of the art planetarium and dome theater systems consisting of proprietary hardware and software, and other unique visual display systems primarily used to project digital video on large curved surfaces.  We also produce unique show content both for our own library which we license to customers and for specific customer requirements for planetarium and dome theaters.  Additionally, we manufacture and install metal domes with customized optical coatings and acoustical properties that are used for planetarium and dome theaters as well as many other unique custom applications.  Our dome engineering and manufacturing resources also design and supply geometrically complex structures for customized architectural treatments, often involving curved metal shapes with unique optical and acoustical properties.

Description of Markets

We are an industry leader in providing full-dome hardware and software to an international customer base in the digital theater, planetarium, entertainment, training and educational markets.  In each of these markets we face highly competitive conditions where we compete on features, performance, and responsiveness to customer needs as well as on price.  E&S is unique among its competitors by virtue of its capability as a single source that can directly supply and integrate all of the equipment in the planetarium theater, including the projection system, sound, lighting, computer control system and domed projection screen.  We believe our range of visual systems and services at various price and performance levels, our research and development investments and capabilities, our responsiveness to customers, and our ability to design and manufacture value-added visual systems enable us to compete effectively. Our competitive strengths with visual systems and services aid the sale of our dome projection screens as customers often require a new dome projection screen with their visual system. We also believe our capabilities to design and manufacture domes and certain other architectural structures are very unique and enable us to compete effectively in all of the markets where these products are sold.

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Digital Theater

In the digital theater market our products compete with traditional optical-mechanical products and digital display systems offered by GOTO Optical Mfg. Co., Konica-Minolta Planetarium Co. Ltd., Carl Zeiss Inc., and Sky-Skan, Inc. The Company's digital display systems can be configured with our proprietary projector systems or standard commercial projectors similar to systems sold by our competitors.  Our proprietary Digistar full-dome digital system, along with other customized software tools differentiate our digital theater systems and compete favorably with competitive digital display systems. Our SciDome planetarium system, which uses a dome theater version of a retail desktop astronomy product with curriculum tools for teachers, creates a unique competitive advantage when targeting smaller classroom planetarium theaters.

Advanced Displays

Our capabilities and products sometimes are used for special advance display applications primarily for wide audiences in specialty theaters and other visitor attractions. This includes the integration of the most advanced video projectors with customized lenses, software and unique application techniques to serve customers who are in search of extraordinary display of visual content. Our competition in these markets includes various specialty audio visual systems integrators and alternative solutions using other technologies.

Domed Structures

Our Spitz subsidiary is the world's leading producer of domed projection screens. At Spitz we design, manufacture, and install domed projection screens used in planetarium theaters and a variety of other applications such as ride simulators, special or large format film theaters, simulation training systems and architectural treatments. We have developed proprietary dome products such as our NanoSeam dome which we believe provides the smoothest, most uniform projection surface available. Our experience with dome projection screens enables us to advise on the architectural integration of domed projection screens and solve complex optical problems involving reflectivity and image distortion on compound curved surfaces. We believe that these skills are important to buyers of domed projection screens. The principal customers of our dome business are entities in the entertainment, educational and commercial and military simulation markets. Customers include major theme parks, casinos, world expositions, museums, schools, and military defense contractors. There is currently one known domestic competitor that manufactures domed projection screens. In addition, construction or metal fabrication contractors occasionally supply domed projection screens, particularly in foreign markets. The structures we design and supply for architectural treatments are sold as complements to our dome screen products or into the architectural market for a wide variety of interesting venues. Competition for our architectural treatment products usually comes from construction or metal fabrication contractors often with an alternative design idea.

Intellectual Property

We own a significant number of patents and trademarks and we are a licensee under several others.  Our portfolio of patents and trademarks, as a whole, contributes to our business.  However, no one piece of intellectual property is critical to our business, thus no individual piece of our intellectual property is separately discussed.  In the U.S. and internationally, we hold active patents that cover many aspects of our visualization technology.  Several patent applications are presently pending and routinely other patent applications are in preparation. We actively pursue patents on our new technology and we intend to vigorously protect our patent rights.  We often trademark key product names and brand names to protect our equity in the marketplace. We routinely copyright software and documentation and institute copyright registration when appropriate.  Currently we retain a total of 18 active U.S. patents.

Research and Development

We consider the timely development and improvement of our technology to be essential to maintain our competitive position and to capitalize on market opportunities.  We continue to fund essentially all research and development ("R&D") efforts internally. 

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R&D efforts continue to improve Digistar, our popular full-dome digital system and a key component to our planetarium and dome theater products.  We also explore the possibility of other commercial applications for Digistar technology as opportunities arise. We conduct ongoing R&D to improve the functionality of SciDome to keep pace with updated versions of the desktop software it emulates and to take advantage of the latest digital display and theater technology. Some noteworthy specific R&D activities for our advance display and planetarium products include the development of unique techniques to display three dimensional digital video and the expansion of educational curriculum tools to cover new subject matter in addition to astronomy such as chemistry and earth sciences.  We continue to develop improvements to our dome products including optical coatings and ways to make the projection surface more uniform.  There are also R&D efforts ongoing to enhance components of the systems we sell, such as improvements to theater lighting.

We continually work with the new digital projection technologies to develop advanced visual display systems primarily to be used by wide audiences in specialty theaters and other visitor attractions. This includes the integration of the most advanced video projectors with customized lenses, software and unique application techniques to serve customers who are in search of extraordinary display of visual content.

Dependence on Suppliers

Most of our current parts and assemblies are readily available through multiple sources in the open market; however, a limited number are available only from a single source.  In these cases, we either stock adequate inventory to cover future product demands, obtain the agreement of the vendor to maintain adequate stock for future demands, or develop alternative components or sources where appropriate.

Employees

As of December 31, 2015, Evans & Sutherland and its subsidiaries employed a total of 96 persons of which 90 were employed full time. 

Environmental Standards

We believe our facilities and operations are within standards fully acceptable to the Environmental Protection Agency and that all facilities and procedures are operated in accordance with environmental rules and regulations, and international, federal, state and local laws.

Strategic Relationships

In the normal course of business, we develop and maintain various types of relationships with key customers and technology partners.  The teaming agreements are with industry partners and are intended to improve our overall competitive position.  The product development agreements enhance our products by the cooperative development of new features and capabilities necessary to maintain our industry leading position.

Forward-Looking Statements and Associated Risks

This annual report, including all documents incorporated herein by reference, includes certain "forward-looking statements" within the meaning of that term in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including, among others, those statements preceded by, followed by or including the words "estimates," "believes," "expects," "anticipates," "plans," "projects," "intends," "predicts," "may," "will," "could," "would," "potential" and similar expressions or the negative of such terms.  See Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in Part II of this annual report on Form 10-K for a list of some of the forward-looking statements included in this Form 10-K.

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EXECUTIVE OFFICERS OF THE REGISTRANT

The following sets forth certain information regarding the executive officers of E&S as of December 31, 2015.

Name	Age	Position
David H. Bateman	73	President, Chief Executive Officer and Director
Paul L. Dailey	59	Chief Financial Officer and Corporate Secretary
Bob Morishita	65	Vice President Human Resources
Kirk D. Johnson	54	Vice President and General Manager of Digital Theater
Jonathan A. Shaw	59	President and Chief Executive Officer of Spitz, Inc.

David H. Bateman was appointed President and Chief Executive Officer of E&S in February 2007.  Mr. Bateman joined E&S as Director of Business Operations in May 1998. He was appointed Vice President – Business Operations in March 2000 and Interim President and Chief Executive Officer and a member of the Board of Directors in June 2006.

Paul L. Dailey was appointed Chief Financial Officer and Corporate Secretary of E&S in February 2007.  He became an executive officer of E&S in August 2006 when he was appointed Acting Chief Financial Officer and Corporate Secretary.  Prior to his appointments at E&S, Mr. Dailey served as Executive Vice President, Chief Financial Officer and Corporate Secretary of E&S's subsidiary, Spitz, Inc., where he started as Controller in 1983. Mr. Dailey is a Certified Public Accountant.

Bob Morishita was appointed Vice President of Human Resources in 2000.  He joined E&S as Compensation Manager in 1982 and was appointed Human Resources Director in 1997.

Kirk D. Johnson was appointed Vice President and General Manager of Digital Theater in January 2002.  He joined E&S in April 1990 and has held various engineering and management positions throughout his service at E&S. 

Jonathan A. Shaw was appointed President and Chief Executive Officer of E&S's subsidiary, Spitz, Inc., in November 2001, where he held various management positions since 1985. 

ITEM 2. PROPERTIES

Our principal executive, engineering, manufacturing and operations facilities are located in the University of Utah Research Park in Salt Lake City, Utah, where we lease two buildings totaling approximately 68,000 square feet.

Spitz owns and occupies an approximately 47,000 square-foot building on approximately 15.2 acres in Chadds Ford, Pennsylvania. The property serves as collateral under Spitz's debt agreements through a mortgage granted to First Keystone Bank which is now The Bryn Mawr Trust Company, a commercial bank.

ITEM 3. LEGAL PROCEEDINGS

In the normal course of business, we may have various legal claims and other contingent matters.  We know of no legal claims outstanding that would have a material adverse effect on our consolidated financial position, liquidity or results of operations.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable

6

PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER

MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Our common stock trades on the Over-the-Counter Markets under the symbol "ESCC."  On March 1, 2016, there were approximately 460 holders of record of our common stock.  Because brokers and other institutions hold many of our shares on behalf of stockholders, we are unable to estimate the total number of stockholders represented by these record holders.

We have never paid a cash dividend on our common stock and have used funds generated internally to operate our business.  For the foreseeable future, we intend to follow our policy of retaining any future earnings to finance the development and growth of our business.

Additional information required by this item is incorporated by reference to the table captioned Securities Authorized for Issuance Under Equity Compensation Plans as of December 31, 2015 in Item 12, "Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters," of Part III of this annual report on Form 10-K.

The table below presents the high and low sales prices per share as reported by the Over-the-Counter Markets, by quarter for 2015 and 2014. The quotations reflect inter-dealer prices, without retail mark-up, mark-down, or commission and may not necessarily represent actual transactions.

	2015				2014
	High		Low		High		Low
First Quarter	$	0.55	$	0.30	$	0.29	$	0.10
Second Quarter		0.95		0.42		0.61		0.21
Third Quarter		1.14		0.49		0.55		0.26
Fourth Quarter		1.21		0.72		0.45		0.24

ITEM 6.  CONSOLIDATED FINANCIAL DATA

Not applicable

7

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis provides information which management believes is relevant to an assessment and understanding of our consolidated results of operations and financial condition.  The discussion should be read in conjunction with our consolidated financial statements and notes included in Item 8, "Financial Statements and Supplementary Data," of this annual report on Form 10-K.  Information set forth in "Management's Discussion and Analysis of Financial Condition and Results of Operations" includes forward-looking statements that involve risks and uncertainties.  Many factors could cause actual results to differ materially from those contained in the forward-looking statements.  See "Forward-Looking Statements" below for additional information concerning these items.

 (All dollar amounts are in thousands unless otherwise indicated.)

Executive Summary

On April 21, 2015, the Company executed agreements ("Pension Settlement Agreement") to terminate its Pension Plan and to settle the underlying pension liabilities. As a result of the Pension Plan termination, the plan's trust assets and benefit obligations have been transferred to the Pension Benefit Guaranty Corporation ("PBGC") thereby eliminating an underfunded pension plan liability on the Company's balance sheet which had a carrying value of approximately $36,000. In return, the Company issued to the PBGC shares of its common stock held in treasury valued at $70 and agreed to pay the PBGC a series of cash installments over twelve years totaling $10,500 (the "Pension Settlement Obligation").  The Pension Settlement Obligation is secured by all of the Company's assets subject to subordination agreements with the Company's senior lenders. This is a major milestone and completes a process that began over two years ago. It relieves the Company from the burden of a variable obligation to fund the Pension Plan benefits, which it clearly was unable to fulfill, and replaces it with a manageable fixed payment obligation.  The Company's goal in seeking a distress termination of the Pension Plan was to ensure that the pension benefits of all Pension Plan participants are paid up to federally guaranteed limits and that the Company continues to operate as a going concern while avoiding the costly damage and disruption to the business which would result from bankruptcy reorganization. We believe that the Pension Settlement Agreement has achieved that goal.

The year ended 2015 produced significantly improved sales and gross profit compared to 2014. The stronger sales and improved gross profit in 2015 were attributable to strong sales bookings in 2014 and 2015. The sales backlog remained healthy at the end of 2015 which supports an encouraging outlook for 2016. Operating expenses, except for a $3,620 charge for the settlement of the pension liabilities, were lower in 2015 as compared to 2014 primarily due to decreased pension expense in the period. The charge for the settlement of the pension liabilities is not a recurring expense item. Absent this charge, results would have been profitable for 2015. The 2015 results illustrate the profit potential of our business without the burden of the Pension Plan. With the healthy backlog and sales prospects, we anticipate sales at levels that should yield profitable results in 2016.

We intend to continue to aggressively pursue opportunities in the digital theater and other markets served by our products, as well as the development and improvement of new innovative products such as Digistar for planetarium theaters. We will continue to develop and improve our planetarium products targeted for smaller venues in education markets such as our SciDome product. We intend to also continue development and improvement of our dome products used by planetarium theaters and many other varied applications.  We also intend to continue the production of quality show content for planetarium theaters.  We believe that the ability to include the wide range of complementary products in the systems we sell, along with access to the legacy customer base of E&S and our subsidiary, Spitz, provides a unique competitive advantage.

We expect variable but reasonably consistent future sales and gross profits from our current product line at annual levels sufficient to cover or exceed operating expenses and meet our obligations including the new Pension Settlement Obligation.  Although we reported a net loss for 2015 due to the pension settlement charge of $3,620, the pension settlement contributed $31,776 to comprehensive income bringing 2015 total comprehensive income to $29,946. This nearly eliminated our stockholders' deficit, which was $30,703 as of December 31, 2014 compared to $646 as of December 31, 2015. With the settlement of the Pension Plan liabilities, we expect our improved financial position to present opportunities for better results through the availability of credit and stronger qualification for customer projects.

8

Results of Operations

Consolidated Sales and Backlog

The following table summarizes our consolidated sales for the years ended December 31:

	2015		2014
Sales	$	35,298	$	26,466

 Sales increased 33% from 2014 to 2015 due to progress and deliveries on a higher volume of customer contracts. Sales were higher for essentially all of the Company's products with the largest increase coming from Digistar planetarium systems for science museums and universities.

The volume of new orders in 2015 was strong but lower than the exceptionally high volume of orders booked in 2014.  As a result, our sales backlog was $26,298 as of December 31, 2015 compared with $28,173 as of December 31, 2014. The sales backlog of domes for theme park attractions remained high at December 31, 2015, setting up 2016 for another strong year in sales to theme park attractions.  We anticipate that approximately 80% of the 2015 backlog will be converted to sales in 2016 and that we will receive sufficient new orders to produce total sales in 2016 comparable to 2015.

Gross Profit

The following table summarizes our gross profit and the percentage to total sales for the years ended December 31:

	2015			2014
Gross profit	$	12,342		$	9,477
Gross profit percentage		35	%		36	%

Our gross profit percentage was slightly lower in 2015 when compared to 2014.  The lower gross margin percentage in 2015 was affected by higher than expected costs to complete two theme park projects; otherwise, efficiencies from the higher sales volume yielded improved margins on other customer projects.

Operating Expenses

The following table summarizes our operating expenses during the years ended December 31:

	2015		2014
Selling, general and administrative	$	6,633	$	6,873
Research and development		2,262		2,187
Pension		522		1,147
Pension settlement		3,620		-
Total operating expense	$	13,037	$	10,207

Operating expenses were higher in 2015 compared to 2014 due to the $3,620 charge for the settlement of the Pension Plan liabilities in the second quarter.  While the settlement of Pension Plan liabilities resulted in this charge to operating expenses, it produced an extraordinary economic benefit to the Company which was reflected in the simultaneous recording of other comprehensive income in the amount of $31,776.

9

Selling, general and administrative expenses were slightly lower in 2015 compared to 2014. This was primarily due to decreased tradeshow activity and the redirection of resources from sales and marketing activities to content software production and research and development activities.

Research and development expenses were slightly higher in 2015 compared to 2014.  This was primarily due to redirecting resources from sales and marketing activities to research and development activities. Research and development activities consisted of improvements to the software in our planetarium products, testing hardware to project high definition video on large dome screens, development of a graphical user interface device for dome theaters, improvements to theater lighting, testing of optical coatings for projection surfaces and developing techniques to make dome projection surfaces more uniform.

Pension expense was lower in 2015 compared to 2014 due to the termination of the Pension Plan in the second quarter of 2015. With the termination of the Pension Plan, future pension expense will be reduced to the expenses attributable to our Supplemental Executive Retirement Plan ("SERP").

Other Expense, net

The following table summarizes our other income and expense during the years ended December 31:

	2015			2014
Interest expense	$	(429	)	$	(629	)
Other income (expense)		(163	)		77

Interest expense in 2014 consisted principally of imputed interest on a financing lease obligation which was extinguished in October 2014. Interest expense in 2015 consisted principally of imputed interest on the Pension Settlement Obligation recorded in the second quarter of 2015. Interest expense also included interest paid on real estate debt in both years presented. Interest expense in 2016 is expected to be comparable to 2015.

The change in other income (expense) was primarily attributable to an increase in realized currency losses in 2015.

10

Income Taxes

The income tax benefit (provision) consisted of federal and state income taxes as follows for the years ended December 31:

	2015		2014
Income tax benefit (provision)	$	12	$	(23	)

The 2014 income tax provision was for state income taxes resulting from Spitz' normal business activity in various jurisdictions.

Other Comprehensive Income (Loss)

The following table summarizes other comprehensive income (loss) for the years ended December 31:

	2015			2014
Decrease (increase) to minimum pension liability	$	(555	)	$	(16,422	)
Reclassification of pension expense to net loss		-			406
Pension settlement		31,776			-
Other comprehensive income (loss)	$	31,221		$	(16,016	)

The economic benefit to the Company from the settlement of Pension Plan liabilities was reflected in the financial statements as other comprehensive income of $31,776. This offset the $3,620 charge to operating expenses from the same transaction. The other pension related charges and credits affecting other comprehensive income (loss) were attributable to the accounting for actuarial valuations of the pension liabilities. Other comprehensive income (loss) in future years is expected to be limited to accounting for potential changes in the actuarial valuation of the SERP liabilities for much less significant amounts than 2015 and 2014.

Liquidity and Capital Resources

Outlook

As discussed in the executive summary above, we have made significant progress in reducing our history of operating losses.  We believe that the termination of the Pension Plan together with the settlement of the underlying pension liabilities achieved our goal of reducing our obligations to levels that make the business viable. As a result, we believe existing liquidity resources and funds generated from forecasted revenue will be sufficient to meet our current and long-term obligations. We continue to operate in a rapidly evolving and often unpredictable business environment that may change the timing or amount of expected future cash receipts and expenditures.

Cash Flows

The following table summarizes our cash flows for the years ended December 31:

	2015			2014
Net cash and cash equivalents provided by (used in):
Operating activities	$	(2,943	)	$	4,005
Investing activities		(173	)		(166	)
Financing activities		(188	)		(177	)
Increase (decrease) in cash and cash equivalents	$	(3,304	)	$	3,662

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Cash and cash equivalents decreased $3,304 to $3,734 during 2015, due primarily to cash used in operating activities.

Operating Activities

The net cash used in operating activities in 2015 was attributable to a decrease in working capital of $6,006 less $3,063 of cash provided by the $1,275 net loss after the effect of $4,338 of non-cash charges.  The non-cash charges consisted primarily of the $3,620 pension settlement charge.  The changes in working capital which used cash were largely attributable to the timing of progress payments on customer projects. Other significant cash outlays were the initial installment payments of the Pension Settlement Obligation.

The net cash provided by operating activities in 2014 was attributable to changes in working capital of $4,052 less $47 of cash used in the $1,305 net loss after the effect of $1,258 of non-cash charges.  The primary changes in working capital which provided cash were decreases in restricted cash, accounts receivable and costs and estimated earnings in billings on uncompleted contracts along with an increase in customer deposits. This reflects an aggregate increase in advance progress payments received on customer orders in 2014. We began using some of the cash provided from customers in 2014 to purchase materials for the projects which is reflected in an increase in inventories.

Investing Activities

Investing activities used $173 of cash during 2015 consisting entirely of purchases of property and equipment.

Investing activities used $166 of cash during 2014 consisting of $229 of proceeds from the sale of marketable securities which was offset by $395 for purchases of property and equipment.

Financing Activities

Financing activities used $188 of cash during 2015 for principal payments on debt obligations.

Financing activities used $177 of cash during 2014 for principal payments on debt obligations.

Credit Facilities

The Company is a party to a line-of-credit agreement with a commercial bank which permits borrowings of up to $1,100 to fund Spitz working capital requirements. Under the line-of-credit agreement, interest is charged on amounts borrowed at the lender's prime rate less 0.25%.  Any borrowings under the Credit Agreement are secured by Spitz real and personal property and all of the outstanding shares of Spitz common stock. The line-of-credit agreement and mortgage notes (with the same commercial bank) contain cross default provisions whereby a default on either agreement will result in a default on both agreements. On October 3, 2014, the commercial bank notified the Company that it was no longer obligated to make advances under the line-of-credit agreement and elected to suspend future advances because of events of default on loan covenants resulting from the statutory liens placed on the Company's assets by the Pension Plan. In September 2015, the bank confirmed that the defaults were cured as a result of the settlement of the pension liabilities. There were no borrowings outstanding under the line-of-credit agreement as of December 31, 2015.

The ability to issue letters of credit and bank guarantees is an important tool to mitigate credit risk in our business. International sales are increasingly important to our business and in many countries, letters of credit and bank guarantees serve as performance guarantees for customer contracts. Also, domestic sales sometimes require performance guarantees in the form of surety bonds.  We have relationships with licensed surety companies to provide performance bonds subject to certain limitations and collateral which we must provide for security. Letters of credit and bank guarantees are issued to serve as collateral and to ensure our performance for these purposes. Cash deposits or deferral of customer payments for performance guarantees can often be used as an alternative to letters of credit.

Under the terms of financing arrangements for letters of credit, the Company is required to maintain a balance in a specific cash account equal to or greater than the outstanding value of all letters of credit issued, plus other amounts necessary to adequately secure obligations with the financial institutions who issue the letters of credit.  As of December 31, 2015, there were outstanding letters of credit and bank guarantees of $600, which are scheduled to expire during the year ending December 31, 2016.

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Mortgage Notes

Debt obligations include a first mortgage note payable to a commercial bank which represents the balance on a $3,200 note ("First Mortgage Note") issued on January 14, 2004 by Spitz. The First Mortgage Note requires repayment in monthly installments of principal and interest over 20 years.  On each third anniversary of the First Mortgage Note, the interest rate is adjusted to the greater of 5.75% or 3% over the Three-Year Constant Maturity Treasury Rate published by the United States Federal Reserve ("3YCMT").  The monthly installment is recalculated in the first month following a change in the interest rate. The recalculated monthly installment is equal to the monthly installment sufficient to repay the principal balance, as of the date of the change in the interest rate, over the remaining portion of the original 20-year term.  On January 14, 2016, the 3YCMT was 1.14% and the interest rate on the First Mortgage Note remained at 5.75% per annum.  The monthly installment amount remained unchanged at $23.

Debt obligations also include a second mortgage note payable to a commercial bank which represents the balance on a $500 note ("Second Mortgage Note") issued on September 11, 2008 by Spitz. The Second Mortgage Note requires repayment in monthly installments of principal and interest over 20 years.  On each 5-year anniversary, the interest rate is adjusted to the greater of 5.75% or 3% over 3YCMT.  The monthly installment is recalculated on the first month following a change in the interest rate. The recalculated monthly installment is equal to the monthly installment sufficient to repay the principal balance, as of the date of the change in the interest rate, over the remaining portion of the original 20-year term. On September 11, 2013, the fifth anniversary of the Second Mortgage Note, the 3YCMT was 0.88%. As a result, interest continues at 5.75% until possible adjustment on the next 5-year anniversary. The monthly installment also remains unchanged at $4.

The Mortgage Notes are secured by the real property occupied by Spitz pursuant to a Mortgage and Security Agreement.  The real property had a carrying value of $4,301 as of December 31, 2015. The Mortgage Notes are guaranteed by E&S.

On October 3, 2014, the commercial bank, notified the Company that the statutory liens placed on the Company's assets by the Pension Plan constituted an event of default under the mortgage note agreements. The commercial bank agreed to forbear from exercising any further remedies, other than suspension of advances under the working capital line of credit, until August 31, 2015 by which time the process of withdrawing the Pension Plan statutory liens was completed in accordance with terms of the settlement of the Pension Plan liabilities thereby curing the default.  The agreement to forbear from exercising any further remedies was subject to the Company continuing to make debt service payments under the mortgage note agreements, the occurrence of no further adverse events in the condition of the Company and the Company's agreement to the incorporation of the financial covenants in the line of credit agreement as additional covenants in the mortgage note agreements effective immediately and continuing until the mortgage notes are paid in full. One of the covenants requires Spitz to maintain tangible net worth of at least $6,000 measured upon issuance of quarterly and annual financial statements. As of the end of the second and third quarter of 2014, Spitz's tangible net worth measured $5,914 and $5,801, respectively. As of December 31, 2014, Spitz's tangible net worth measured $5,744.  The commercial bank granted a waiver of the event of default for the failure to maintain Spitz's tangible net worth of at least $6,000 as of the end of the second and third quarters of 2014 and as of December 31, 2014. At the end of each fiscal quarter of 2015 Spitz tangible net worth exceeded the $6,000 covenant compliance threshold.  The Company believes that it will be in compliance with the additional covenants in future periods.

Sale-Leaseback Financing

In November 2009, the Company completed a purchase agreement with a buyer, Wasatch Research Park I, LLC ("Wasatch"), to sell its corporate office buildings and its interest in the lease for the land occupied by the buildings in Utah for $2,500.  Under the agreement, E&S transferred legal title of the buildings including improvements and assigned the related land lease to Wasatch. E&S also entered into a sublease agreement to lease back the land and building for rent of $501 per year, of which $126 represents the land lease and $375 represents the building lease.   The sublease agreement had a term of 5 years with an option for two subsequent 5-year renewal periods.  The agreement provided the Company with a 5-year option to repurchase all of the buildings under lease or only one of the buildings known as the Substation along with the lease interest in the land. In 2011, Rocky Mountain Power ("RMP"), a public utility company, obtained a decree of condemnation of the Substation so that RMP may repurpose the Substation for public use. As such, the Company no longer had the option to buy the Substation.

13

The arrangement was accounted for as a financing and no sale was recorded because the Company had the right to repurchase the property.  Therefore, the assets representing the building and improvements remained in property and equipment and the Company recorded the net proceeds of the sale as long-term debt. The $126 portion of the sublease payment attributable to the land lease was equivalent to the payment under the assigned land lease and therefore was subject to the same rent escalations the Company was bound to before the assignment. The land lease portion of the sublease payment was recorded as rent expense consistent with the treatment of the prior land lease payment before the assignment of the lease. The $375 portion of the sublease agreement attributable to the building lease was accounted for as debt service under the financing transaction.  The net proceeds of the financing amounted to $2,329 consisting of the $2,500 sales price less a security deposit of $125, prorated building rent of $15 and the first monthly payment of $31. E&S recorded interest expense at a rate of approximately 20% imputed from the estimated cash flows assuming it would exercise the option to repurchase the property at the end of the 5-year term.

The repurchase transaction was required to have been completed by October 31, 2014. On November 4, 2014, the Company agreed to an extension of its current lease for a term of 5 years. As a condition of the extension the Company will no longer have a right to repurchase the buildings. Base annual rent for the extended 5-year term is $549. Base annual rent prior to the lease extension was $509.

The extension of the lease for five years without a repurchase option was recorded as a disposition of building assets along with the extinguishment of lease debt obligation in the amount of $3,152 and the deferred rent obligation on the land lease of $1,525. The book value of the disposed building amounted to $2,532. As a result, the gain on the disposal of the building assets was $620. The new lease obligation is recorded as an operating lease for a term of five years commencing November 1, 2014. Accounting for a sale leaseback transaction was applied and as a result the $620 gain on the disposition of the building assets was deferred and will be amortized over the five-year term of the new operating lease. Likewise, the $1,525 gain from the extinguishment of the deferred rent credit is being amortized over the five-year term of the new operating lease.

Other

In 2016, we expect capital expenditures similar to 2015.  There were no material capital expenditure commitments as of December 31, 2015, nor do we anticipate any over the next several years.

Our Board of Directors has authorized the repurchase of 1,600,000 shares of our common stock.  As of February 28, 2016, 463,500 shares remained available for repurchase under the plans approved by the Board of Directors.  No shares were repurchased during 2015 or 2014.  Stock may be acquired on the open market or through negotiated transactions depending on market conditions, share price and other factors.

We also maintain trade credit arrangements with certain suppliers.  The unavailability of a significant portion of, or the loss of, these trade credit arrangements from suppliers would have a material adverse effect on our financial condition and operations.

As of December 31, 2015, our total indebtedness was $2,174 on the mortgage notes.  Our cash and restricted cash, subject to various restrictions set forth in this annual report on Form 10-K, are available for working capital needs, capital expenditures, strategic investments, mergers and acquisitions, stock repurchases and other potential cash needs as they may arise.

Effects of Inflation

The effects of inflation were not considered material for the years 2015 and 2014, and are not expected to be material for the year 2016.

Application of Critical Accounting Estimates

The application of the accounting estimates discussed below is considered by management to be critical to an understanding of our consolidated financial statements.  Their application places significant demands on management's judgment, with financial reporting results relying on estimates about the effect of matters that are inherently uncertain.  Specific risks for these critical accounting estimates are described in the following paragraphs.  A summary of significant accounting policies can be found in Note 1, "Nature of Operations and Summary of Significant Accounting Policies," of Item 8, "Financial Statements and Supplementary Data," in this annual report on Form 10-K. For all of these policies, management cautions that future results rarely develop exactly as forecast, and the best estimates routinely require adjustment.

14

Revenue Recognition

Revenue from long-term contracts requiring significant production, modification and customization is recorded using the percentage-of-completion method.  This method uses the ratio of costs incurred to management's estimate of total anticipated costs.  Our estimates of total costs include assumptions, such as man-hours to complete, estimated materials cost, and estimates of other direct and indirect costs.  Actual results may vary significantly from our estimates.  If the actual costs are higher than management's anticipated total costs, then an adjustment is required to reduce the previously recognized revenue as the ratio of costs incurred to management's estimate was overstated.  If actual costs are lower than management's anticipated total costs, then an adjustment is required to increase the previously recognized revenue as the ratio of costs incurred to management's estimate is understated.  Adjustments for revisions of previous estimates are made in the period they become known.

Costs and Estimated Earnings in Excess of Billings on Uncompleted Contracts and Billings in Excess of Costs and Estimated Earnings on Uncompleted Contracts

Billings on uncompleted long-term contracts may be greater than or less than incurred costs and estimated earnings.  As a result, these differences are recorded as an asset or liability on the balance sheet.  Since revenue recognized on these long-term contracts includes management's estimates of total anticipated costs, the amounts in costs and estimated earnings in excess of billings on uncompleted contracts and billings in excess of costs and estimated earnings on uncompleted contracts also include these estimates.

Inventories

Inventories include materials at standard costs, which approximate actual costs, and inventoried costs on programs, including material, labor, subcontracting costs, as well as an allocation of indirect costs.  We periodically review inventories for excess supply, obsolescence, and valuations above estimated realizable amounts, and then provide a reserve we consider sufficient to reduce inventories to net realizable values.  Reserve adequacy is based on estimates of future sales, product pricing, and requirements to complete projects.  Revisions of these estimates would result in adjustments to our operating results.

Allowance for Doubtful Accounts Receivable

We specifically analyze accounts receivable and consider historical experience, customer creditworthiness, facts and circumstances specific to outstanding balances, current economic trends, and changes in payment terms when evaluating the adequacy of the allowance for doubtful accounts receivable.  Changes in these factors could result in material adjustments to the expense recognized for bad debts.

Income Taxes

As part of the process of preparing our consolidated financial statements, we are required to estimate our actual income taxes in each of the jurisdictions in which we operate.  This involves estimating our actual current tax exposure together with assessing temporary differences resulting from differing treatments of items, such as accrued liabilities, for tax and accounting purposes.  These differences result in deferred income tax assets and liabilities, which are included in our consolidated balance sheets.  We must then assess the likelihood that our deferred income tax assets will be recovered from future taxable income and, to the extent we believe that recovery is not likely, we must establish a valuation allowance.  To the extent we establish a valuation allowance or increase or decrease this allowance in a period, we must include a corresponding adjustment within the income tax provision in the statement of comprehensive income (loss).  Significant judgment by management is required to determine our provision for income taxes, our deferred income tax assets and liabilities and any valuation allowance recorded against our net deferred income tax assets.

Impairment of Long- Lived Assets

Long-lived assets are reviewed for impairment when events or changes in circumstances indicate the carrying values of the assets may not be fully recoverable. When this occurs, we review the value assigned to long-lived assets by analyzing the anticipated, undiscounted cash flows they generate.  When the expected future undiscounted cash flows from these assets do not exceed their carrying values, the Company determines the estimated fair value of such assets. Impairment is recognized to the extent the carrying values of the assets exceed their estimated fair values.  Assets held for sale are reported at the lower of their carrying values or fair values less costs to sell.

15

Straight-Line Rent and Contingent Obligation

We recognize scheduled rent increases on a straight-line basis over the lease term, which may include optional lease renewal terms, and deferred rent income and expense is recognized to reflect the difference between the rent paid or received in the current period and the calculated straight-line amount.

Recent Accounting Pronouncements

In November 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update No. 2015-17, Income Taxes (Topic 740) ("ASU 2015-17").  ASU 2015-17 requires that all deferred income tax assets and liabilities be classified as non-current.  ASU 2015-17 is not effective until the 2017 fiscal year.  The Company is currently assessing the impact, if any, on its financial reporting of implementing this guidance.

In April 2015, the FASB issued ASU No. 2015-03, Interest – Imputation of Interest (Subtopic 835-30), Simplifying the Presentation of Debt Issuance Costs ("ASU 2015-03").  To simplify presentation of debt issuance costs, the amendments in ASU 2015-03 require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts.  The recognition and measurement guidance for debt issuance costs are not affected by the amendments in ASU 2015-03.  For public companies, ASU 2015-03 is effective for financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years.  Early adoption is permitted for financial statements that have not been previously issued.  The Company is currently assessing the impact, if any, on its financial reporting of implementing this guidance.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers ("ASU 2014-09"). ASU 2014-09 provides for a single, principles-based model for revenue recognition that replaces existing revenue recognition guidance. ASU 2014-09 is effective for annual and interim periods beginning on or after December 15, 2016. It permits the use of either a retrospective or cumulative effect transition method and early adoption is not permitted. The Company has not yet selected a transition method and is in the process of evaluating the effect ASU 2014-09 will have on its consolidated financial statements and related disclosures.  During 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers: Deferral of the Effective Date ("ASU 2015-14"), which deferred the date of ASU 2014-09 by one year.

In August 2014, the FASB issued ASU No. 2014-15, Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern ("ASU 2014-15"). This standard sets forth management's responsibility to evaluate, each reporting period, whether there is substantial doubt about the entity's ability to continue as a going concern, and if so, to provide related note disclosures. ASU 2014-15 is effective for annual reporting periods beginning after December 15, 2016, and interim periods within annual periods ending after December 15, 2016. The Company is currently assessing the impact, if any, on its financial reporting of implementing this guidance.

Forward-Looking Statements

The foregoing contains "forward-looking statements" within the meaning of that term in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including among others, those statements preceded by, followed by or including the words "estimates," "believes," "expects," "plans," "projects," and similar expressions.

These forward-looking statements include, but are not limited to, the following statements:

· Our belief that our range of products and services at various price and performance levels, our research and development investments and capabilities, and our ability to design and manufacture products will enable us to compete effectively.

· Our belief that our facilities and operations are within standards fully acceptable to the Environmental Protection Agency and that all facilities and procedures are operated in accordance with environmental rules and regulations, and international, federal, state and local laws.

· Our belief that our existing sources of liquidity, including marketable securities, will provide sufficient liquidity to meet our obligations through 2016 and beyond.

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· Our belief that our ability to include the wide range of complementary products offered by E&S and Spitz in the systems we sell, along with access to the legacy customer base of E&S and Spitz, provides a unique competitive advantage.

· Our expectations for variable future sales and gross profits from our current product line at annual levels sufficient to cover or exceed operating expenses.

· Our belief that an improved financial position as a result of relief from the burden of the Pension Plan may present opportunities for better results through the availability of credit and stronger qualification for customer projects.

· Our belief that any potential shortfalls in our forecasted revenues would be within a range whereby we could reduce variable costs in order to meet our 2016 obligations.

· Our belief that the business has the potential for long-term profitability without the burden of the Pension Plan.

· Our belief that capital expenditures during 2016 will be similar to the capital expenditures incurred during 2015.

· Our belief that the effects of inflation will not be material for 2016.

· Our belief that approximately 80% of our backlog will be converted to sales in 2016.

· Our belief that our 2016 orders will continue at a level sufficient to recognize sales in 2016 comparable to 2015.

Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified.  Future events and actual results could differ materially from those set forth in, contemplated by, or underlying the forward-looking statements.  Our actual results could differ materially from these forward-looking statements.  Important factors to consider in evaluating such forward-looking statements include risks of product demand, market acceptance, economic conditions, competitive products and pricing, difficulties in product development, and product delays.  In light of these risks and uncertainties, there can be no assurance that the events contemplated by the forward-looking statements contained in this annual report will, in fact, occur.

17

 ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

	December 31,
	2015			2014
ASSETS
Current assets:
Cash and cash equivalents	$	3,734		$	7,038
Restricted cash		601			711
Accounts receivable, net		4,825			4,586
Costs and estimated earnings in excess of billings on
uncompleted contracts		2,695			1,699
Inventories, net		4,072			4,163
Prepaid expenses and deposits		1,038			635
Total current assets		16,965			18,832
Property and equipment, net		4,735			4,803
Goodwill		635			635
Intangible assets, net		27			68
Other assets		1,082			1,118
Total assets	$	23,444		$	25,456
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Accounts payable	$	1,062		$	710
Accrued liabilities		1,031			1,142
Billings in excess of costs and estimated earnings on
uncompleted contracts		3,995			5,176
Customer deposits		3,232			4,081
Current portion of retirement obligations		480			535
Current portion of pension settlement obligation		356			-
Current portion of long-term debt		199			2,362
Total current liabilities		10,355			14,006
Pension and retirement obligations, net of current portion		4,839			40,076
Pension settlement obligation, net of current portion		5,268			-
Long-term debt, net of current portion		1,975			-
Deferred rent obligation		1,653			2,077
Total liabilities		24,090			56,159
Commitments and contingencies (Notes 4, 5, 6 and 8)
Stockholders' deficit:
Preferred stock, no par value: 10,000,000 shares authorized;
no shares outstanding		-			-
Common stock, $0.20 par value: 30,000,000 shares authorized;
11,441,666 shares issued		2,288			2,288
Additional paid-in-capital		53,434			54,500
Common stock in treasury, at cost, 264,350 and 352,467
shares, respectively		(3,532	)		(4,709	)
Accumulated deficit		(50,432	)		(49,157	)
Accumulated other comprehensive loss		(2,404	)		(33,625	)
Total stockholders' deficit		(646	)		(30,703	)
Total liabilities and stockholders' deficit	$	23,444		$	25,456

See notes to consolidated financial statements.

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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(In thousands, except per share data)

	Years Ended December 31,
	2015			2014
Sales	$	35,298		$	26,466
Cost of sales		(22,956	)		(16,989	)
Gross profit		12,342			9,477
Operating expenses:
Selling, general and administrative		(6,633	)		(6,873	)
Research and development		(2,262	)		(2,187	)
Pension		(522	)		(1,147	)
Pension settlement		(3,620	)		-
Total operating expenses		(13,037	)		(10,207	)
Operating loss		(695	)		(730	)
Interest expense		(429	)		(629	)
Other income (expense), net		(163	)		77
Loss before income tax benefit (provision)		(1,287	)		(1,282	)
Income tax benefit (provision)		12			(23	)
Net loss	$	(1,275	)	$	(1,305	)
Net loss per common share – basic and diluted	$	(0.11	)	$	(0.12	)
Weighted average common shares outstanding – basic		11,150			11,089
Weighted average common shares outstanding – diluted		11,150			11,089
Comprehensive income (loss), net of tax:
Net loss	$	(1,275	)	$	(1,305	)
Reclassification of pension expense to net loss		-			406
Pension settlement		31,776			-
Increase in minimum pension liability		(555	)		(16,422	)
Other comprehensive income (loss)		31,221			(16,016	)
Total comprehensive income (loss)	$	29,946		$	(17,321	)

See notes to consolidated financial statements.

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CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT

(In thousands)

														Accumulated
					Additional									Other
	Common Stock				Paid-in			Treasury			Accumulated			Comprehensive
	Shares		Amount		Capital			Stock			Deficit			Loss			Total
Balance, December 31, 2013		11,442	$	2,288	$	54,484		$	(4,709	)	$	(47,852	)	$	(17,609	)	$	(13,398	)
Net loss		-		-		-			-			(1,305	)		-			(1,305	)
Other comprehensive loss		-		-		-			-			-			(16,016	)		(16,016	)
Stock-based compensation		-		-		16			-			-			-			16
Balance, December 31, 2014		11,442		2,288		54,500			(4,709	)		(49,157	)		(33,625	)		(30,703	)
Net loss		-		-		-			-			(1,275	)		-			(1,275	)
Issuance of 88,117 shares from treasury for pension settlement		-		-		(1,107	)		1,177			-			-			70
Other comprehensive income		-		-		-			-			-			31,221			31,221
Stock-based compensation		-		-		41			-			-			-			41
Balance, December 31, 2015		11,442	$	2,288	$	53,434		$	(3,532	)	$	(50,432	)	$	(2,404	)	$	(646	)

See notes to consolidated financial statements.

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CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

	Years Ended December 31,
	2015			2014
Cash flows from operating activities:
Net loss	$	(1,275	)	$	(1,305	)
Adjustments to reconcile net loss to net cash provided
by (used in) operating activities:
Depreciation and amortization		291			465
Amortization of deferred pension costs		106			406
Pension settlement charge		3,620			-
Provision for excess and obsolete inventory		155			197
Other		166			190
Changes in assets and liabilities:
Decrease in restricted cash		110			309
Decrease (increase) in accounts receivable		(373	)		979
Increase in inventories		(64	)		(1,335	)
Decrease (increase) in costs and estimated earnings in excess of
excess of billings on uncompleted contracts, net		(2,177	)		2,510
Decrease (increase) in prepaid expenses and other assets		(367	)		326
Increase (decrease) in accounts payable		352			(723	)
Decrease in accrued liabilities		(111	)		(29	)
Increase (decrease) in accrued pension and retirement liabilities		(84	)		91
Decrease in pension settlement obligation		(2,019	)		-
Increase (decrease) in customer deposits		(849	)		1,924
Decrease in deferred rent obligation		(424	)		-
Net cash provided by (used in) operating activities		(2,943	)		4,005
Cash flows from investing activities:
Purchases of property and equipment		(182	)		(395	)
Proceeds from sale of property and equipment		9			-
Proceeds from sale of marketable securities		-			229
Net cash used in investing activities		(173	)		(166	)
Cash flows from financing activities:
Principal payments on long-term debt		(188	)		(177	)
Net cash used in financing activities		(188	)		(177	)
Net increase (decrease) in cash and cash equivalents		(3,304	)		3,662
Cash and cash equivalents as of beginning of the year		7,038			3,376
Cash and cash equivalents as of end of the year	$	3,734		$	7,038
Supplemental disclosures of non-cash investing and financing activities
Settlement of pension liability	$	35,870		$	-
Increase in minimum pension and retirement obligations		661			16,422
Disposal of building and accrued lease obligations		-			9,378
Supplemental disclosures of cash flow information
Cash paid during the year for:
Interest	$	364		$	425
Income taxes		12			22

See notes to consolidated financial statements.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

All dollar amounts are in thousands except share and per share information or unless otherwise indicated.

Note 1 - Nature of Operations and Summary of Significant Accounting Policies

Nature of Operations

Evans & Sutherland Computer Corporation, referred to in these notes as "Evans & Sutherland," "E&S," or the "Company," produces high-quality advanced visual display systems used primarily in full-dome video projection applications, dome projection screens and dome architectural treatments. E&S also produces unique content for planetariums, schools, science centers and other educational institutions and entertainment venues.  The Company's products include state of the art planetarium and dome theater systems consisting of proprietary hardware and software, and other unique visual display systems primarily used to project digital video on large curved surfaces.  Additionally, E&S manufactures and installs metal domes with customized optical coatings and acoustical properties that are used for planetarium and dome theaters as well as many other unique custom applications.  The Company operates in one business segment, which is the visual simulation market.

Basis of Presentation

The consolidated financial statements include the accounts of Evans & Sutherland and its wholly owned subsidiaries.  All inter-company accounts and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes.  The accounting estimates that require management's most difficult and subjective judgments include revenue recognition based on the percentage-of-completion method, inventory reserves, allowance for doubtful accounts receivable, allowance for deferred income tax assets, impairment of long-lived assets, pension and retirement obligations and useful lives of depreciable assets.  Actual results could differ from those estimates.

Cash and Cash Equivalents

The Company considers all highly liquid investments with original maturities of three or fewer months to be cash equivalents.  The Company maintains cash balances in bank accounts that, at times, exceed federally insured limits.  The Company has not experienced any losses in these accounts and believes it is not exposed to any significant risk with respect to cash.  As of December 31, 2015, cash deposits as reported by the banks, including restricted cash, exceeded the federally insured limits by approximately $4,022.

Restricted Cash

Restricted cash that guarantees letters of credit that mature or expire within one year is reported as a current asset.  Restricted cash that guarantees letters of credit that mature or expire after more than one year is reported as a long-term asset.  There was no restricted cash included in other assets as of December 31, 2015 and 2014.

Trade Accounts Receivable

In the normal course of business, E&S provides unsecured credit terms to its customers.  Accordingly, the Company maintains an allowance for doubtful accounts for possible losses on uncollectible accounts receivable.  The Company routinely analyzes accounts receivable and costs and estimated earnings in excess of billings, and considers history, customer creditworthiness, facts and circumstances specific to outstanding balances, current economic trends, and changes in payment terms when evaluating the adequacy of the allowance for doubtful accounts receivable.  Changes in these factors could result in material differences to bad debt expense.  Past due balances are determined based on contractual terms and are reviewed individually for collectability. Uncollectible accounts receivable are charged against the allowance for doubtful accounts when management determines the probability of collection is remote.

22

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The table below represents changes in E&S's allowance for doubtful accounts receivable for the years ended December 31:

	2015			2014
Beginning balance	$	217		$	277
Write-off of accounts receivable		(64	)		(47	)
Increase (decrease) in estimated losses on accounts receivable		133			(13	)
Ending balance	$	286		$	217

Inventories

Inventories include materials at standard costs, which approximate actual costs, as well as inventoried costs on programs and long-term contracts.  Inventoried costs include material, direct engineering and production costs, and applicable overhead, not in excess of estimated realizable value.  Spare parts and general stock materials are stated at cost not in excess of realizable value.  E&S periodically reviews inventories for excess supply, obsolescence, and valuations above estimated realizable amounts, and provides a reserve sufficient to reduce inventories to net realizable values.  Revisions of these estimates could impact net loss.

During the years ended December 31, 2015 and 2014, E&S recognized impairment losses on inventory of $155 and $197, respectively.

Inventories as of December 31, were as follows:

	2015			2014
Raw materials	$	5,958		$	5,468
Work in process		1,265			1,678
Finished goods		220			233
Reserve for obsolete inventory		(3,371	)		(3,216	)
Inventories, net	$	4,072		$	4,163

Property and Equipment

Property and equipment are stated at cost.  Depreciation and amortization are computed using the straight-line method based on the estimated useful lives of the related assets.  Expenditures that materially increase values or capacities or extend useful lives of property and equipment are capitalized.  Leasehold improvements are assigned useful lives based on the shorter of their useful lives or the term of the related leases, including renewal options likely to be exercised.  Routine maintenance, repairs and renewal costs are expensed as incurred.  When property is retired or otherwise disposed of, the carrying values are removed from the property and equipment and related accumulated depreciation and amortization accounts.  Depreciation and amortization are included in cost of sales, research and development or selling, general and administrative expenses depending on the nature of the asset.

23

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Depreciation expense was $250 and $418 for the years ended December 31, 2015 and 2014, respectively.  The cost and estimated useful lives of property and equipment and the total accumulated depreciation and amortization were as follows as of December 31:

	Estimated
	Useful Lives	2015			2014
Land	n/a	$	2,250		$	2,250
Buildings and improvements	5 - 40 years		3,028			3,028
Manufacturing machinery and equipment	3 - 8 years		5,301			5,183
Office furniture and equipment	3 - 8 years		779			779
Total			11,358			11,240
Less accumulated depreciation and amortization			(6,623	)		(6,437	)
Net property and equipment		$	4,735		$	4,803

Goodwill

The Company tests its recorded goodwill for impairment on an annual basis during the fourth quarter, or more often if indicators of potential impairment exist, by determining if the carrying value of each reporting unit exceeds its estimated fair value. Factors that could trigger impairment include, but are not limited to, underperformance relative to historical or projected future operating results, significant changes in the manner of use of the acquired assets or the Company's overall business and significant negative industry or economic trends. Future impairment reviews may require write-downs in the Company's goodwill and could have a material adverse impact on the Company's operating results for the periods in which such write-downs occur.

Intangible Assets

E&S amortizes the cost of intangible assets over their estimated useful lives. Amortizable intangible assets are reviewed at least annually to determine whether events and circumstances warrant a revision to the remaining period of amortization.  Amortization expense was $41 and $47 for the years ended December 31, 2015 and 2014, respectively.

Software Development Costs

Software development costs, if material, are capitalized from the date technological feasibility is achieved until the product is available for general release to customers.  Such costs were not material for the years presented.

Impairment of Long-Lived Assets

Long-lived assets are reviewed for impairment when events or changes in circumstances indicate the carrying values of the assets may not be fully recoverable. When this occurs, the Company reviews the values assigned to long-lived assets by analyzing the anticipated, undiscounted cash flows they generate.  When the expected future undiscounted cash flows from these assets do not exceed their carrying values, the Company estimates the fair values of such assets. Impairment is recognized to the extent the carrying values of the assets exceed their estimated fair values.  Assets held for sale are reported at the lower of their carrying values or fair values less costs to sell.

Warranty Reserve

E&S provides a warranty reserve for estimated future costs of servicing products under warranty agreements extending for periods from 90 days to one year.  Anticipated costs for product warranties are based upon estimates derived from experience factors and are recorded at the time of sale or over the period revenues are recognized for long-term contracts.  Warranty reserves are classified as accrued liabilities in the accompanying consolidated balance sheets.

24

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The table below represents changes in E&S's warranty reserve for the years ended December 31:

	2015			2014
Beginning balance	$	125		$	150
Additions to warranty reserve		149			98
Warranty costs		(147	)		(123	)
Ending balance	$	127		$	125

Revenue Recognition

Sales include revenues from system hardware, software, database products and service contracts.  The following table provides information on revenues by recognition method applied during the years:

	2015		2014
Percentage of completion	$	19,827	$	14,085
Completed contract		13,653		10,670
Other		1,818		1,711
Total sales	$	35,298	$	26,466

The following methods are used to record revenue:

Percentage of Completion. In arrangements that are longer in term and require significant production, modification or customization, revenue is recognized using the percentage-of-completion method.  In applying this method,  the Company utilizes the cost-to-cost methodology whereby it estimates the percent complete by calculating the ratio of costs incurred (consisting of material, labor and subcontracting costs, as well as an allocation of indirect costs) to its estimate of total anticipated costs.   This ratio is then utilized to determine the amount of gross profit earned based on its estimate of total gross profit at completion.  The Company routinely reviews estimates related to percentage-of-completion contracts and adjusts for changes in the period the revisions are made.  Billings on uncompleted percentage-of-completion contracts may be greater than or less than incurred costs and estimated earnings, and are recorded as an asset or liability in the accompanying consolidated balance sheets.

Completed Contract. Contract arrangements which typically require a relatively short period of time to complete the production, modification, and customization of products are accounted for using the completed contract method.  Accordingly, revenue is recognized upon delivery of the completed product, provided persuasive evidence of an arrangement exists, title and risk of loss have transferred, the fee is fixed or determinable, and collection is reasonably assured.

Multiple Element Arrangements.  Some contracts include multiple elements.  Significant deliverables in such arrangements commonly include various hardware components of visual display systems, domes, show content and various service and maintenance elements.  Revenue earned on elements such as products, services and maintenance contracts are allocated to each element based on the relative fair values of the elements.  Relative fair values of elements are generally determined based on actual and estimated selling price.  Delivery times of such contracts typically occur within a three to six-month time period.

Other.  Other revenue consists primarily of amounts earned under maintenance contracts that are generally sold as a single element to customers.  Revenue from product maintenance contracts, including separately priced extended warranty contracts, is deferred and recognized over the period of performance under the contract.

Anticipated Losses.  For contracts with anticipated losses at completion, a provision is recorded when the loss is probable.  After an anticipated loss is recorded, subsequent revenue and cost of sales are recognized in equal, offsetting amounts as contract costs are incurred.

25

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Net Loss per Common Share

Net loss per common share is computed based on the weighted-average number of common shares and, as appropriate, dilutive common stock equivalents outstanding during the year.  Stock options are common stock equivalents.

Basic loss per common share is based upon the average number of shares of common stock outstanding during the year. Potentially dilutive securities from stock options are discussed in Note 9.

Income Taxes

The Company uses the asset and liability method of accounting for income taxes.  Under the asset and liability method, deferred income tax assets and liabilities are recognized for the future income tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective income tax bases and operating loss and income tax credit carry-forwards.  Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred income tax assets and liabilities of a change in income tax rates is recognized in the period that includes the enactment date.

Other Comprehensive Loss

On a net basis for 2015 and 2014, there were deferred income tax assets resulting from items reflected in comprehensive loss.  However, E&S has determined that it is more likely than not that it will not realize such net deferred income tax assets and has therefore established a valuation allowance against the full amount of the net deferred income tax assets.  Accordingly, the net income tax effect of the items included in other comprehensive income (loss) is zero.  Therefore, the Company has included no income tax expense or benefit in relation to items reflected in other comprehensive income (loss).

The components of accumulated other comprehensive loss were as follows as of December 31:

	2015			2014
Additional minimum pension liability	$	(2,404	)	$	(33,625	)
Total accumulated other comprehensive loss	$	(2,404	)	$	(33,625	)

Leases

The Company recognizes scheduled rent increases on a straight-line basis over the lease term, which may include optional lease renewal terms. Deferred rent income and expense are recognized to reflect the difference between the rent paid or received in the current period and the calculated straight-line amount.

Recent Accounting Pronouncements

In November 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update No. 2015-17, Income Taxes (Topic 740) ("ASU 2015-17").  ASU 2015-17 requires that all deferred income tax assets and liabilities be classified as non-current.  ASU 2015-17 is not effective until the 2017 fiscal year.  The Company is currently assessing the impact, if any, on its financial reporting of implementing this guidance.

In April 2015, the FASB issued ASU No. 2015-03, Interest – Imputation of Interest (Subtopic 835-30), Simplifying the Presentation of Debt Issuance Costs ("ASU 2015-03").  To simplify presentation of debt issuance costs, the amendments in ASU 2015-03 require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts.  The recognition and measurement guidance for debt issuance costs are not affected by the amendments in ASU 2015-03.  For public companies, ASU 2015-03 is effective for financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years.  Early adoption is permitted for financial statements that have not been previously issued.  The Company is currently assessing the impact, if any, on its financial reporting of implementing this guidance.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers ("ASU 2014-09"). ASU 2014-09 provides for a single, principles-based model for revenue recognition that replaces existing revenue

26

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

recognition guidance. ASU 2014-09 is effective for annual and interim periods beginning on or after December 15, 2016. It permits the use of either a retrospective or cumulative effect transition method and early adoption is not permitted. The Company has not yet selected a transition method and is in the process of evaluating the effect ASU 2014-09 will have on its consolidated financial statements and related disclosures.  During 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers: Deferral of the Effective Date ("ASU 2015-14"), which deferred the date of ASU 2014-09 by one year.

In August 2014, the FASB issued ASU No. 2014-15, Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern ("ASU 2014-15"). This standard sets forth management's responsibility to evaluate, each reporting period, whether there is substantial doubt about the entity's ability to continue as a going concern, and if so, to provide related note disclosures. ASU 2014-15 is effective for annual reporting periods beginning after December 15, 2016, and interim periods within annual periods ending after December 15, 2016. The Company is currently assessing the impact, if any, on its financial reporting of implementing this guidance.

Liquidity

The Company has experienced recurring annual losses since 2007, except for 2013. On April 21, 2015, the Company executed an agreement (the "Pension Settlement Agreement") which terminated its defined benefit pension plan (the "Pension Plan") and settled the Pension Plan's liabilities in exchange for an obligation to pay to the Pension Benefit Guaranty Corporation ("PBGC") $10,500 over twelve years and issue to the PBGC 88,117 shares of E&S treasury stock (see Note 5). In addition, the Pension Settlement Agreement has led to a new banking relationship and improved credit capacity. Aided by prior cost reduction efforts and improved sales volume, for the year ended December 31, 2015, the Company has generated profitable results before recording the pension expense and a charge for the settlement of the Pension Plan. The Company is no longer incurring expenses related to the terminated Pension Plan but as of December 31, 2015 is responsible for eleven annual installment payments of $750 to the PBGC. Management believes that the Company's unrestricted cash balances totaling $3,734 as of December 31, 2015 and improved credit capacity and forecasted operations provide sufficient resources to meet the Company's obligations, including the terms of the Pension Settlement Agreement, through at least the end of 2016.

Note 2 – Definite-Lived Intangible Assets and Goodwill

Definite-lived intangible assets consisted of the following as of December 31, 2015 and 2014:

			December 31,
			2015					2014
	Weighted Avg.		Gross					Gross
	Amortization		Carrying		Accumulated			Carrying		Accumulated
	Period in Years		Amount		Amortization			Amount		Amortization
Class
Maintenance and legacy customers		10	$	350	$	(335	)	$	350	$	(308	)
Planetarium shows		10		280		(268	)		280		(254	)
Total			$	630	$	(603	)	$	630	$	(562	)

Amortization expense for the years ended December 31, 2015 and 2014 was $41 and $47, respectively.

Maintenance and legacy customers and planetarium shows represent the value of definite-lived intangibles that were identified in the acquisition of Spitz in 2006.

27

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The remaining balance of definite-lived intangible assets is expected to be amortized to expense in 2016. Goodwill of $635 resulted from the acquisition of the Company's wholly owned subsidiary, Spitz, and was measured as the excess of the $2,884 purchase consideration paid over the fair value of the net assets acquired. The Company has made its annual assessment of impairment of goodwill and has concluded that goodwill is not impaired as of December 31, 2015.

Note 3 - Costs and Estimated Earnings on Uncompleted Contracts

Comparative information with respect to uncompleted contracts as of December 31:

	2015			2014
Total accumulated costs and estimated earnings on uncompleted contracts	$	33,445		$	29,629
Less total billings on uncompleted contracts		(34,745	)		(33,106	)
Ending balance	$	(1,300	)	$	(3,477	)

The above amounts are reported in the consolidated balance sheets as of December 31 as follows:

	2015			2014
Costs and estimated earnings in excess of billings on uncompleted contracts	$	2,695		$	1,699
Billings in excess of costs and estimated earnings on uncompleted contracts		(3,995	)		(5,176	)
Ending balance	$	(1,300	)	$	(3,477	)

Note 4 – Leases and gain on disposal of building assets

The Company occupies real property and uses certain equipment under lease arrangements that are accounted for as operating leases.  The Company's real property leases contain escalation clauses.  Rental expense for all operating leases for 2015 and 2014 was $216 and $230, respectively.

On November 4, 2014, the Company agreed to an extension of its real estate lease for its corporate office buildings for a term of 5 years. The previous lease term included a repurchase option and was recorded as a financing obligation (see Note 6). Under the lease extension, the repurchase option expired and the extended lease term is recorded as an operating lease. Base annual rent for the extended 5-year term is $549.

The extension of the lease for five years without a repurchase option was recorded as a disposal of building assets with a book value of $2,532. The extinguishment of the lease obligation recorded as debt in the amount of $3,152 represented consideration received for the disposal. The disposal of the building assets and extinguishment of the lease financing obligation resulted in a gain on the disposal of the building assets in the amount of $620. Accounting for a sale leaseback transaction was applied and, as a result, the $620 gain on the disposal of the building assets was deferred and will be recognized ratably, as a credit against rent expense, over the five-year term of the new operating lease. The amount of the gain on the building asset disposal recognized in 2014 was $21.

There was also a deferred rent credit of $1,526 which was extinguished as a result of the new operating lease. The deferred rent credit represented previously recorded but unpaid rent expense for the prior long-term land lease in accordance with straight-line lease accounting. Because, under the new five-year operating lease, the Company will no longer be obligated or expected to pay the unpaid rent expense reflected in the deferred rent credit, the $1,526 balance is extinguished and represents additional gain as a result of the new lease extension.  The $1,526 gain from the extinguishment of the deferred rent credit will be recognized ratably over the five-year term as a credit against rent expense of the new operating lease. The amount of the gain from the extinguishment of the deferred rent credit recognized in 2014 was $51.

Future minimum rent expense payments under the new operating lease and the remaining deferred gain from the disposal of the building assets and deferred rent credit to be recognized are as follows:

28

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Years Ending	Rent		Gain on			Deferred			Net Rent
December 31,	Expense		Building			Rent Credit			Expense
2016	$	549	$	(124	)	$	(305	)	$	120
2017		549		(124	)		(305	)		120
2018		565		(124	)		(305	)		136
2019		475		(106	)		(260	)		109
Total	$	2,138	$	(478	)	$	(1,175	)	$	485

There are no other lease obligations that have initial or remaining non-cancelable lease terms in excess of one year.

Note 5 - Employee Retirement Benefit Plans

Settlement of Pension Plan Liabilities

On January 7, 2013, the Company submitted a PBGC Form 600 Distress Termination, Notice of Intent to Terminate, to the PBGC. The notice filing initiated an application process by the Company with the PBGC for the distress termination of the Pension Plan. The Pension Plan benefits are guaranteed by the ERISA Title IV insurance fund, which is administered by the PBGC. The Company proposed a termination date of March 8, 2013. Through the application process, the Company's intent was to demonstrate to the PBGC that it qualified for a distress termination of the Pension Plan under either of two of the criteria of Section 4041(c)(2) of ERISA (inability to continue in business absent termination and unreasonably increased pension costs) and applicable PBGC regulations. To satisfy the criteria, the Company and its wholly owned subsidiary each had to demonstrate to the satisfaction of the PBGC that, unless the termination occurred, the Company would be unable to pay its debts when they came due and would be unable to continue in business, or that the costs of the Pension Plan had become unreasonably burdensome solely as a result of a decline in the workforce covered by the Pension Plan. A distress termination under Section 4041(c)(2) of ERISA transfers the Pension Plan's benefit obligations to the PBGC, up to ERISA guaranteed limits, without requiring reorganization under bankruptcy law. The Pension Plan's actuary informed the Company that following termination of the Pension Plan and subject to the PBGC's review of participant benefits, all of the benefits earned by participants as of the date of plan termination are expected to fall within ERISA guaranteed limits.

The Company's goal in seeking a distress termination of the Pension Plan was to ensure that the pension benefits of all Pension Plan participants are paid up to federally guaranteed limits and that the Company continues to operate as a going concern while avoiding the costly damage and disruption to the business which would result from reorganization.

Pursuant to a determination by the PBGC that the requirements of the distress termination of the Pension Plan had been met, on April 21, 2015, the Company, as the administrator of the Pension Plan, and the PBGC entered into an Agreement For Appointment of Trustee and Termination of Plan (the "Termination Agreement") (a) terminating the Plan, (b) establishing March 8, 2013 as the Plan's termination date and (c) appointing the PBGC as statutory trustee of the Plan.

In connection with the Termination Agreement, on April 21, 2015, the Company entered into the Pension Settlement Agreement with the PBGC to settle all liabilities of the Pension Plan including any termination premium resulting from the Pension Plan termination (the "Settled ERISA Liabilities"). Pursuant to the Pension Settlement Agreement, the Company agreed to (a) pay to the PBGC a total of $10,500, with $1,500 due within ten days following the effective date of the Pension Settlement Agreement and the remainder paid in twelve annual installments of $750 beginning on October 31, 2015 (the "Pension Settlement Obligation") and (b) issue within ten days following the effective date of the Pension Settlement Agreement 88,117 shares of the Company's treasury stock in the name of the PBGC. On April 23, 2015, the Company issued to the PBGC the 88,117 shares of stock and on May 1, 2015 it paid the initial $1,500 amount due to the PBGC. On October 22, 2015, the Company made the first of the twelve annual installments.  The Pension Settlement Agreement further provides that the PBGC will be deemed to have

29

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

released the Company from all Settled ERISA Liabilities upon payment of the Pension Settlement Obligation. In the event of a default by the Company of its obligations under the Pension Settlement Agreement or the underlying agreements which secure the Pension Settlement Obligation, the PBGC may enforce payment of the Settled ERISA Liabilities, which would accrue interest at various rates until payment is made and be reduced by any payments made by the Company pursuant to the Pension Settlement Agreement.  The estimated total Settled ERISA Liabilities as of the settlement date is $46,000.

To secure the Company's obligations under the Pension Settlement Agreement, on April 21, 2015, the Company also entered into a Security Agreement with the PBGC (the "Security Agreement"), and executed an Open-End Mortgage in favor of the PBGC (the "Mortgage") on certain real property owned by the Company's subsidiary, Spitz, Inc. ("Spitz"). The Security Agreement and Mortgage grant to the PBGC a security interest on all of the Company's presently owned and after-acquired property and proceeds thereof, free and clear of all liens and other encumbrances, except those described therein (the "Senior Liens"). The PBGC's security interest in the Company's property is subordinate to the Company's two senior lenders pursuant to the Security Agreement and agreements between the PBGC and the lenders (the "Intercreditor Agreements"). The Intercreditor Agreements provide for the lenders to extend credit to the Company, secured by the Senior Liens, up to specified limits. The Intercreditor Agreement between the lender of the mortgage notes and line of credit (see Note 6) and the PBGC provides for total aggregate loans of up to $6,500 secured by Senior Liens on Spitz assets. The second Intercreditor Agreement between another lender and the PBGC provides for up to $3,000 of letter of credit indebtedness secured by Senior Liens on cash deposits. The Pension Settlement Agreement also required that the PBGC withdraw all lien notices with respect to the statutory liens it previously perfected on behalf of the Pension Plan with respect to all real and personal property of the Company as soon as reasonably practicable after the 91st day after the perfection of all consensual liens granted to the PBGC by the Security Agreement and Mortgage.  In August 2015, the PBGC's lien notices with respect to the statutory liens were withdrawn.

The termination of the Pension Plan and settlement of its underlying liabilities enables the Company to satisfy the previously disclosed unfunded liability attributable to the Pension Plan by the issuing to the PBGC the 88,117 shares of stock from treasury and making the fixed installment payments of the Pension Settlement Obligation. As of the date of the Pension Settlement Agreement, the balance of the unfunded liability attributable to the Pension Plan, which was previously reported with Pension and Retirement Obligations, was $35,870, of which $31,776 was attributable to accumulated other comprehensive loss. The market value of the 88,117 shares of stock issued to the PBGC from treasury on April 23, 2015 was $70. The Pension Settlement Obligation was recorded as a liability of the Company as of April 21, 2015 in the amount of $7,643, reflecting the present value of the installments at an interest rate of 7%, which the Company believes represents the fair market interest rate for junior secured debt with similar secured terms of the Security Agreement. The unfunded Pension Plan liability of $35,870 exceeded the $7,714 combined value of the stock issued to the PBGC and the Pension Settlement Obligation by $28,156. There are no income tax consequences of the settlement since no tax deduction was taken for the pension expense that gave rise to the Pension Plan liability. Accordingly, the settlement of the Pension Plan Liabilities was recorded as of April 21, 2015 as follows:

 

Unfunded Pension Plan Liability	$	35,870
Market value of common shares issued from treasury		(70	)
Pension Settlement Obligation		(7,644	)
Total consideration to PBGC		(7,714	)
Total gain from settlement of  Pension Plan Liabilities	$	28,156
Gain recorded as:
Charge to statement of operations	$	(3,620	)
Other comprehensive Income		31,776
Contribution to total comprehensive income	$	28,156

30

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

After applying the first $1,500 installment made on May 1, 2015, and the first annual installment on October 22, 2015, and recording imputed interest expense at 7%, the balance of the Pension Settlement Obligation is recorded with liabilities on the balance sheet as follows as of December 31, 2015:

Current portion of pension settlement obligation	$	356
Pension settlement obligation, net of current portion		5,268
Total Pension Settlement Obligation	$	5,624

As a result of the settlement of Pension Plan liabilities on April 21, 2015, the Company's only remaining pension obligation is the Supplemental Executive Retirement Plan ("SERP"). The Company recorded expense of $326 related to the Pension Plan for the first quarter prior to the Termination Agreement executed on April 21, 2015.

Supplemental Executive Retirement Plan

The SERP provides eligible executives defined pension benefits, outside the Pension Plan, based on average salary, years of service and age at retirement.  The SERP was amended in 2002 to discontinue further SERP gains from future salary increases and close the SERP to new participants.

401(k) Deferred Savings Plan

The Company has a deferred savings plan that qualifies under Section 401(k) of the Internal Revenue Code.  The 401(k) plan covers all employees of the Company who have at least one year of service and who are age 18 or older.  Matching contributions are made on employee contributions after the employee has achieved one year of service.  Extra matching contributions can be made based on profitability and other financial and operational considerations.  No extra matching contributions have been made to date.  Contributions to the 401(k) plan for 2015 and 2014 were $168 and $197, respectively.

Obligations and Funded Status for Pension Plan and SERP

E&S uses a December 31 measurement date for both the Pension Plan and the SERP.

Information concerning the obligations, plan assets and funded status of employee retirement defined benefit plans are provided below:

31

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

	Pension Plan						SERP
Changes in benefit obligation	2015			2014			2015			2014
Projected benefit obligation - beginning of year	$	64,831		$	48,091		$	4,871		$	4,846
Service cost		-			-			-			-
Interest cost		617			2,275			177			218
Actuarial loss		1,690			14,942			769			308
Benefits paid		(339	)		(477	)		(497	)		(501	)
Transfer of benefit obligation upon termination		(66,799	)		-			-			-
Projected benefit obligation - end of year	$	-		$	64,831		$	5,320		$	4,871

	Pension Plan						SERP
Changes in plan assets	2015			2014			2015			2014
Fair value of plan assets - beginning of year	$	29,721		$	29,073		$	-		$	-
Actual return on plan assets		1,547			1,125			-			-
Contributions		-			-			497			501
Benefits paid		(339	)		(477	)		(497	)		(501	)
Transfer out upon termination		(30,929	)		-			-			-
Fair value of plan assets - end of year	$	-		$	29,721		$	-		$	-

	Pension Plan					SERP
Net amount recognized	2015		2014			2015			2014
Unfunded status	$	-	$	(35,111	)	$	(5,320	)	$	(4,871	)
Accrued PBGC insurance premiums		-		(629	)		-			-
Unrecognized net actuarial loss		-		31,971			2,415			1,713
Unrecognized prior service cost		-		-			(11	)		(59	)
Net amount recognized	$	-	$	(3,769	)	$	(2,916	)	$	(3,217	)

Amounts recognized in the consolidated balance sheets consisted of:

	Pension Plan					SERP
	2015		2014			2015			2014
Accrued liability	$	-	$	(35,111	)	$	(5,320	)	$	(4,871	)
Accrued PBGC insurance premiums		-		(629	)		-			-
Accumulated other comprehensive loss		-		31,971			2,404			1,654
Net amount recognized	$	-	$	(3,769	)	$	(2,916	)	$	(3,217	)

Components of net periodic benefit cost:

	Pension Plan						SERP
	2015			2014			2015			2014
Service cost	$	-		$	-		$	-		$	-
Interest cost		617			2,275			177			218
Expected return on assets		(585	)		(2,298	)		-			-
Amortization of actuarial loss		195			406			68			50
Amortization of prior year service cost		-			-			(49	)		(49	)
Net periodic benefit expense		227			383			196			219
Insurance premium due PBGC		99			545			-			-
	$	326		$	928		$	196		$	219

Additional information

Pension expense was $522 for the year ended December 31, 2015, which included net periodic benefit expense of $227 for the pension, $196 for the SERP and $99 of insurance premiums due to the PBGC.  Pension expense was $1,147 for the year ended December 31, 2014, which included net periodic benefit expense of $383 for the pension, $219 for the SERP, $394 of insurance premiums due to the PBGC and $151 of federal excise tax related to non-payment of minimum pension funding requirements.

32

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

There was an unrecognized net actuarial loss of $15,710 in 2014 due to a decrease in the discount rate used to remeasure the Pension Plan of 4.8% as of December 31, 2013 compared to 3.8% as of December 31, 2014.  The discount rate is estimated based on an index of similar fixed income securities.

The SERP minimum liability recorded in other comprehensive loss increased $750 in 2015 compared to an increase of $307 in 2014.  The increase in 2015 reflected the decrease to the discount rate used to measure the SERP as of December 31, 2015 of 3.7% compared to 3.8% as of December 31, 2014 and the use of more current mortality tables.

Assumptions

The weighted average assumptions used to remeasure benefit obligations as of December 31, 2015 and 2014 included a discount rate of 3.8% and 4.8%, respectively, for the Pension Plan and SERP.  The weighted average assumptions used to determine net periodic cost for the periods ended December 31, 2015 and 2014 included a discount rate of 3.8% and 4.8%, respectively, in each period for the Pension Plan and SERP. The weighted average assumption used to determine an expected long-term rate of return on Pension Plan assets was 8.0%.

The long-term rate of return on plan assets was estimated as the weighted average expected return of each of the asset classes in the target allocation of plan assets.  The expected return of each asset class is based on historical market returns.

Pension Plan Assets

The Pension Plan's weighted-average asset allocations and weighted-average targeted asset allocations for each of the years presented were as follows:

			2015		2014
Asset allocation category of plan assets	Target %		Actual %		Actual %
Mutual funds - equity securities		60		n/a		61
Mutual funds - debt securities		25		n/a		39
Real estate investment trust		5		n/a		-
Hedge funds		10		n/a		-

The asset allocation policy, consistent with the long-term growth objectives of the Pension Plan, was to invest on a diversified basis among various asset classes as determined by the Pension Plan Administrative Committee.  Assets were invested in a manner intended to provide for long-term growth with a goal to achieve returns equal to or greater than applicable benchmarks.  Investments were managed by registered investment advisors.

No securities of the Company were part of the Pension Plan assets at any time.

Fair Value Measurements

The Pension Plan assets included a significant amount of mutual funds invested in equity and debt securities that were classified within Level 1 because the underlying investments had readily available market prices.Fair values of real estate investments within the real estate investment trust were classified as Level 3 because they were valued using real estate valuation techniques and other methods that include reference to third-party sources and sales comparables where available.  Hedge fund investments were classified in Level 2 and the fair values were generally calculated from pricing models with market input parameters from third-party sources.  The Pension Plan assets fair value measurements are summarized below:

33

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

	December 31,
	2014		Level 1		Level 2		Level 3
Pension Plan Assets:
Mutual funds - equity securities	$	18,227	$	18,227	$	-	$	-
Mutual funds - debt securities		11,449		11,449		-		-
Money market mutual funds		45		45		-		-
Total	$	29,721	$	29,721	$	-	$	-

Cash Flows

Employer contributions

Through September 15, 2012, the Company's funding policy was to contribute to the Pension Plan trust amounts sufficient to satisfy regulatory funding standards, based upon independent actuarial valuations. Beginning in October 2012, the Company discontinued this policy in order to preserve the necessary liquidity for its operations. As a result, a statutory lien in favor of the PBGC was placed against the assets of the Company to secure aggregate unpaid contributions which amounted to $6,979, including interest, as of January 15, 2015, which is the date the most recent contribution was due. However, under the Pension Settlement Agreement all of the Pension Plan's liabilities, including the unpaid contributions were settled for an amount substantially less than the total and the PBGC statutory lien was withdrawn in favor of new consensual liens which are subordinate to the Company's senior lenders (see Settlement of Pension Plan Liabilities above).

The Company is not currently required to fund the SERP.  All benefit payments are made by E&S directly to those who receive benefits from the SERP.  As such, these payments are treated as both contributions and benefits paid for reporting purposes.

The Company expects to contribute and pay benefits of approximately $480 related to the SERP in 2016.

Estimated future benefit payments

As of December 31, 2015, the following benefits are expected to be paid based on actuarial estimates and prior experience:

Years Ending
December 31,	SERP
2016	$	480
2017		516
2018		507
2019		449
2020		441
2021-2025		2,195

34

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 6 –Debt

Long-term debt consisted of the following as of December 31, 2015 and 2014:

	2015			2014
First mortgage note payable due in monthly installments of $23 (interest   at 5.75%) through January 1, 2024; payment and rate subject to   adjustment every 3 years, next adjustment January 14, 2019	$	1,789		$	1,957
Second mortgage note payable due in monthly installments of $4 (interest   at 5.75%) through October 1, 2028; payment and rate subject to   adjustment every 5 years, next adjustment October 1, 2018		385			405
Total debt		2,174			2,362
Current portion of long-term debt		(199	)		(2,362	)
Long-term debt, net of current portion	$	1,975		$	-

Principal maturities on total debt are as follows:

Years Ending
December 31,
2016	$	199
2017		211
2018		224
2019		237
2020		251
Thereafter		1,052
Total debt	$	2,174

Mortgage Notes

The first mortgage note payable represents the balance on a $3,200 note ("First Mortgage Note") issued on January 14, 2004 by Spitz. The First Mortgage Note requires repayment in monthly installments of principal and interest over 20 years.  On each third anniversary of the First Mortgage Note, the interest rate is adjusted to the greater of 5.75% or 3% over the Three-Year Constant Maturity Treasury Rate published by the United States Federal Reserve ("3YCMT").  The monthly installment is recalculated on the first month following a change in the interest rate. The recalculated monthly installment is equal to the monthly installment sufficient to repay the principal balance, as of the date of the change in the interest rate, over the remaining portion of the original 20-year term.  On January 14, 2016, the 3YCMT was 1.14% and the interest rate on the First Mortgage Note remained at 5.75% per annum. As a result, the monthly installment amount remained at $23.

The second mortgage note payable represents the balance on a $500 note ("Second Mortgage Note") issued on September 11, 2008 by Spitz. The Second Mortgage Note requires repayment in monthly installments of principal and interest over 20 years.  On each fifth anniversary of the Second Mortgage Note, the interest rate is adjusted to the greater of 5.75% or 3% over 3YCMT.  The monthly installment is recalculated on the first month following a change in the interest rate. The recalculated monthly installment is equal to the monthly installment sufficient to repay the principal balance, as of the date of the change in the interest rate, over the remaining portion of the original 20-year term.  On September 11, 2013, the fifth anniversary of the Second Mortgage Note, the 3YCMT was 0.88%. As a result, interest continues at 5.75% until possible adjustment on the next 5-year anniversary. The monthly installment also remains unchanged at $4.

The Mortgage Notes are secured by the real property occupied by Spitz pursuant to a Mortgage and Security Agreement.  The real property had a carrying value of $4,301 as of December 31, 2015. The Mortgage Notes are guaranteed by E&S.

On October 3, 2014, the holder of the mortgage notes, a commercial bank, notified the Company that the statutory liens placed on the Company's assets by the Pension Plan constituted an event of default under the mortgage note agreements. The commercial bank agreed to forbear from exercising any further remedies, other than suspension of advances under the working capital line of credit, until August 31, 2015 by which time the process of withdrawing the statutory Pension Plan liens was completed in accordance with terms of the Pension Settlement Agreement (see Note 5) curing the default.  The agreement to forbear from exercising any further remedies was subject to the Company continuing to make debt service payments under the mortgage note agreements, the occurrence of no further adverse events in the condition of the Company and the Company's agreement to the incorporation of the financial covenants in the line of credit agreement as additional covenants in the mortgage note agreements effective immediately and continuing until the mortgage notes are paid in full. One of the covenants requires Spitz to maintain tangible net worth of at least $6,000 measured upon issuance of quarterly and annual financial statements. As of the end of the second and third quarter of 2014, Spitz's tangible net worth measured $5,914 and $5,801, respectively. As of December 31, 2014, Spitz's tangible net worth measured $5,744.  The commercial bank granted a waiver of the event of default for the failure to maintain Spitz's tangible net worth of at least $6,000 as of the end of the second and third quarters of 2014 and as of December 31, 2014. At the end of each fiscal quarter of 2015 Spitz tangible net worth exceeded the $6,000 covenant compliance threshold.  The Company believes that it will be in compliance with the additional covenants in future periods.

35

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Line of Credit

The Company is a party to a line-of-credit agreement with a commercial bank which permits borrowings of up to $1,100 to fund Spitz working capital requirements. Under the line of credit agreement, interest is charged on amounts borrowed at the lender's prime rate less 0.25%.  Any borrowings under the Credit Agreement are secured by Spitz real and personal property and all of the outstanding shares of Spitz common stock. The line-of-credit agreement and mortgage notes (with the same commercial bank) contain cross default provisions whereby a default on either agreement will result in a default on both agreements. On October 3, 2014, the commercial bank notified the Company that it was no longer obligated to make advances under the line-of-credit agreement and elected to suspend future advances because of events of default on loan covenants resulting from the statutory liens placed on the Company's assets by the Pension Plan. In September 2015, the bank confirmed that the defaults were cured as a result of the settlement of the pension liabilities. There were no borrowings outstanding under the line-of-credit agreement as of December 31, 2015.

Sale/Leaseback Financing

In November 2009, the Company completed a purchase agreement with a buyer, Wasatch Research Park I, LLC ("Wasatch") to sell its corporate office buildings and its interest in the lease for the land occupied by the buildings in Utah for $2,500.  Under the agreement, E&S transferred legal title of the buildings including improvements and assigned the related land lease to Wasatch. E&S also entered into a sublease agreement to lease back the land and building for rent of $501 per year, of which $126 represents the land lease and $375 represents the building lease.   The sublease agreement had a term of 5 years with an option for two subsequent 5-year renewal periods.  The agreement provided the Company with a 5-year option to repurchase all of the buildings under lease or only one of the buildings known as the Substation along with the lease interest in the land. In 2011, Rocky Mountain Power ("RMP"), a public utility company, obtained a decree of condemnation of the Substation so that RMP may repurpose the Substation for public use. As such, the Company no longer had the option to buy the Substation.

The arrangement was accounted for as a financing and no sale was recorded because the Company had the right to repurchase the property.  Therefore, the assets representing the building and improvements remained in property and equipment and the Company recorded the net proceeds of the sale as long-term debt. The $126 portion of the sublease payment attributable to the land lease was equivalent to the payment under the assigned land lease and therefore was subject to the same rent escalations the Company was bound to before the assignment. The land lease portion of the sublease payment was recorded as rent expense consistent with the treatment of the prior land lease payment before the assignment of the lease. The $375 portion of the sublease agreement attributable to the building lease was accounted for as debt service under the financing transaction.  The net proceeds of the financing amounted to $2,329 consisting of the $2,500 sales price less a security deposit of $125, prorated building rent of $15 and the first monthly payment of $31. E&S recorded interest expense at a rate of approximately 20% imputed from the estimated cash flows assuming it would exercise the option to repurchase the property at the end of the 5-year term.

36

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The repurchase transaction was required to have been completed by October 31, 2014. On November 4, 2014, the Company agreed to an extension of its current lease for a term of 5 years. As a condition of the extension, the Company no longer has a right to repurchase the buildings. Base annual rent for the extended 5-year term is $549.

The extension of the lease for 5 years without a repurchase option resulted in a new operating lease and the extinguishment of the lease debt obligation in the amount of $3,152 along with the disposal of building assets amounting to $2,532. As a result, there was a gain on the disposal of the building assets in the amount of $620 which was deferred under sale leaseback accounting rules (see Note 4).

Note 7 - Income Taxes

The Company recognizes the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the more-likely-than-not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority.  The Company is subject to audit by the IRS and various states for tax years dating back to 2011.  The Company recognizes interest and penalties, if any, related to unrecognized tax benefits in income tax expense.

Income tax for 2015 and 2014 consisted of a benefit of $12 and expense of $23, respectively, of federal and state income taxes. The actual expense differs from the expected tax benefit (provision) as computed by applying the U.S. federal statutory income tax rate of 34 percent for 2015 and 2014, as follows:

	2015			2014
Income tax benefit at U.S. federal statutory rate	$	440		$	436
State tax benefit (provision) (net of federal income tax benefit)		(14	)		42
Change in valuation allowance attributable to operations		4,146			(332	)
Change in effective tax rate		(4,064	)		-
Pension settlement		(466	)		-
Other, net		(31	)		(169	)
Income tax benefit (provision)	$	12		$	(23	)

The tax effects of temporary differences that give rise to significant portions of the deferred income tax assets and liabilities as of December 31, 2015 and 2014 are as follows:

	2015			2014
Property and equipment, principally due to differences in depreciation	$	(722	)	$	845
Inventory reserves and other inventory-related temporary basis differences		696			663
Warranty, vacation, deferred rent and other liabilities		883			1,114
Retirement liabilities		1,088			2,427
Net operating loss carryforwards		62,194			63,511
Credit carryforwards		817			825
Other		1,227			944
Total deferred income tax assets		66,183			70,329
Less valuation allowance		(66,183	)		(70,329	)
Net deferred income tax assets	$	-		$	-

37

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Worldwide income (loss) before income taxes consisted of the following:

	2015			2014
United States	$	(1,296	)	$	(1,282	)
International		-			-
Total	$	(1,296	)	$	(1,282	)

Income tax benefit (provision) consisted of the following:

	2015			2014
Current
U.S. federal	$	-		$	-
State		12			(23	)
Total	$	12		$	(23	)
Deferred
U.S. federal	$	(4,068	)	$	985
State		(78	)		(653	)
Total		(4,146	)		332
Valuation allowance (increase) decrease		4,146			(332	)
Total	$	-		$	-

E&S has total federal net operating loss carryforwards of approximately $168,400 which expire from 2018 through 2033.  No federal net operating loss carryforwards expired in 2015 or 2014.  The Company has various federal tax credit carryforwards of approximately $800, a portion of which expire between 2015 and 2016.  E&S also has state net operating loss carryforwards of approximately $149,700 that expire at various dates depending on the rules of the states to which the loss or credit is allocated.

During the years ended December 31, 2015 and 2014, the valuation allowance on deferred income tax assets decreased by $4,146 and increased by $332, respectively.  Valuation allowances were established according to the belief that it is more likely than not that these net deferred income tax assets will not be realized.

Note 8 - Commitments and Contingencies

Letters of Credit

Underthe terms of financing arrangements for letters of credit, E&S is required to maintain a balance in a specific cash account equal to or greater than the outstanding value of all letters of credit or bank guarantees issued, plus other amounts necessary to adequately secure obligations with the financial institution.  As of December 31, 2015, there were outstanding letters of credit and bank guarantees of $600, which are scheduled to expire in 2016.  There was no restricted cash included in other assets as of December 31, 2015 or 2014.

Note 9 - Stock Option Plan

In 2014, stockholders approved the adoption of the Evans & Sutherland Computer Corporation 2014 Stock Incentive Plan ("2014 Plan") which replaced the expired 2004 Stock Incentive Plan of Evans & Sutherland Computer Corporation ("2004 Plan").  The 2014 Plan is a stock incentive plan that provides for the grant of options and restricted stock awards to employees and for the grant of options to non-employee directors essentially the same as the 2004 Plan.  Under the 2014 Plan, non-employee directors may continue to receive an annual option grant for no more than 10,000 shares.  New non-employee directors may also continue to receive an option grant for no more than 10,000 shares upon their appointment or election.  With the adoption of the 2014 Plan, no additional options can be issued under the 2004 Plan.  Options granted under the 2004 Plan are still held by recipients and will continue to be subject to the terms and conditions of the 2004 plan which are essentially the same as the 2014 Plan. The 2014 Plan continues a minimum exercise price for options of 110% of fair market value on the date of grant.

38

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Restricted stock awards may be qualified as a performance-based award that conditions a participant's award upon achievement by the Company or its subsidiaries of performance goals established by the Board of Directors' Compensation Committee.

The number of shares, terms, and exercise periods of option grants are determined by the Board of Directors on an option-by-option basis. Options generally vest ratably over three years and expire ten years from the date of grant.  As of December 31, 2015, options to purchase 1,303,713 shares of common stock were authorized and reserved for future grant.

A summary of activity follows (shares in thousands):

	2015					2014
				Weighted-					Weighted-
				Average					Average
	Number			Exercise		Number			Exercise
	of Shares			Price		of Shares			Price
Outstanding as of beginning of the period		1,333		$	2.08		1,235		$	2.62
Granted		221			0.39		200			0.13
Exercised		-			-		-			-
Forfeited or expired		(84	)		7.23		(102	)		4.85
Outstanding as of end of the period		1,470			1.53		1,333			2.08
Exercisable as of end of the period		1,065			2.01		996			2.74

The weighted average fair value of options granted during 2015 and 2014 was $0.39 and $0.13, respectively.  As of December 31, 2015, options exercisable and options outstanding had a weighted average remaining contractual term of 3.4 and 4.8 years, respectively, and no aggregate intrinsic value. As of December 31, 2014, options exercisable and options outstanding had a weighted average remaining contractual term of 3.4 and 4.7 years, respectively, and no aggregate intrinsic value.

The fair value of each option grant is estimated on the date of the grant using the Black-Scholes option-pricing model with the following weighted-average assumptions used for the grants made in 2015 and 2014:

	2015			2014
Expected life (in years)		3.5			3.5
Risk free interest rate		0.91	%		0.74	%
Expected volatility		340	%		340	%
Dividend yield		-			-

Expected option lives and volatilities are based on historical data of the Company.  The risk free interest rate is calculated as the average US Treasury bill rate that corresponds with the option life.  Historically, the Company has not declared dividends and there are no plans to do so.

As of December 31, 2015, there was approximately $35 of total unrecognized share-based compensation cost related to grants under the plan that will be recognized over a weighted-average period of 1.9 years.  As of December 31, 2014, there was approximately $10 of total unrecognized share-based compensation cost related to grants under the plan that will be recognized over a weighted-average period of 1.9 years.

Share-based compensation expense, from awards under the 2004 Plan for the years ended December 31, 2015 and 2014 amounted to $41 and $16, respectively, and was recorded as general and administrative expense.

39

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 10 - Preferred Stock

Class A Preferred Stock

The Company has 5,000,000 authorized shares of Class A Preferred stock.  As of December 31, 2015 and 2014, there were no Class A Preferred shares outstanding.

Class B Preferred Stock

The Company has 5,000,000 authorized shares of Class B Preferred stock.  As of December 31, 2015 and 2014, there were no Class B Preferred shares outstanding.

Note 11 - Geographic Information

The table below presents sales by geographic location:

	2015		2014
United States	$	16,809	$	11,639
International		18,489		14,827
Total sales	$	35,298	$	26,466

Note 12 - Significant Customers

As of December 31, 2015, Customers A, B, C and D represented 14%, 14%, 13% and 13% of accounts receivable, respectively, and Customers E and F represented 41% and 12% of costs and estimated earnings in excess of billings, respectively.

As of December 31, 2014, Customers E and G represented 23% and 12% of accounts receivable, respectively, and Customers E and H represented 37% and 15% of costs and estimated earnings in excess of billings, respectively.

For the years ended December 31, 2015 and 2014, no individual customer represented 10% or more of total sales.

40

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders

Evans & Sutherland Computer Corporation

We have audited the accompanying consolidated balance sheets of Evans & Sutherland Computer Corporation (the Company) as of December 31, 2015 and 2014, and the related consolidated statements of comprehensive income (loss), stockholders' deficit and cash flows for the years then ended.   These consolidated financial statements are the responsibility of the Company's management.  Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement.  The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.  Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting.  Accordingly, we express no such opinion.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.  We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Evans & Sutherland Computer Corporation as of December 31, 2015 and 2014, and the consolidated results of its operations and its cash flows for the years then ended in conformity with U.S. generally accepted accounting principles.

/s/ Tanner LLC

Salt Lake City, Utah

March 16, 2016

41

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures.

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the "Exchange Act")) as of the end of the period covered by this report.  Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures as of the end of the period covered by this report were effective at the reasonable assurance level such that the information required to be disclosed by us in reports filed under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission and (ii) accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding disclosure. In designing and evaluating the disclosure controls and procedures, management recognized that any control system cannot provide absolute assurance, however, that the objectives of the control system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.

Management's Annual Report on Internal Control over Financial Reporting. 

Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act). Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes of U.S. generally accepted accounting principles.  Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance of achieving their control objectives. Further, because of changes in conditions, the effectiveness of internal control may vary over time.

Our management, with the participation of the Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the Company's internal control over financial reporting as of December 31, 2015.  In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control — Integrated Framework (1992).  Based on this evaluation, our management, with the participation of the Chief Executive Officer and Chief Financial Officer, concluded that, as of December 31, 2015, our internal control over financial reporting was effective based on those criteria.

This annual report does not include an attestation report of the Company's independent registered public accounting firm regarding internal control over financial reporting.  Management's report was not subject to attestation by the Company's independent registered public accounting firm pursuant to rules of the Securities and Exchange Commission that permit the Company to provide only management's report in this annual report.

Changes in Internal Control Over Financial Reporting.

There have been no changes in our internal control over financial reporting identified in connection with the evaluation of disclosure controls and procedures discussed above that occurred during the year ended December 31, 2015, or subsequent to that date, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. Our process for evaluating controls and procedures is continuous and encompasses constant improvement of the design and effectiveness of established controls and procedures and the remediation of any deficiencies which may be identified during this process.

ITEM 9B. OTHER INFORMATION

None

42

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

Certain information required by Item 401 of Regulation S-K will be included under the caption "Election of Directors" in the Proxy Statement for our 2016 Annual Meeting of Stockholders and that information is incorporated herein by reference.  Information required by Item 405 of Regulation S-K will be included under the caption "Compliance with Section 16(a) of the Securities Exchange Act of 1934" in the Proxy Statement for our 2016 Annual Meeting of Stockholders and that information is incorporated herein by reference.  Certain information required by Item 401 of Regulation S-K is included in Part I of this Form 10-K under the caption "Executive Officers of the Registrant." The information required by Item 407(c)(3), 407(d)(4) and 407(d)(5) of Regulation S-K will be included under the caption "Election of Directors" in the Proxy Statement for our 2016 Annual Meeting of Stockholders and that information is herein incorporated by reference.

Code of Ethics

Evans & Sutherland maintains a Code of Ethics and Business Conduct which is applicable to all employees, including all officers, and including our independent non-employee directors with regard to Evans & Sutherland related activities.  The Code of Ethics and Business Conduct incorporates our guidelines designed to deter wrongdoing and to promote honest and ethical conduct and compliance with applicable laws and regulations. It also incorporates our expectations of our employees that enable us to provide accurate and timely disclosure in our filings with the Securities and Exchange Commission and other public communications.  In addition, they incorporate our expectations of our employees concerning prompt internal reporting of violations of our Code of Ethics and Business Conduct.

The full text of the Evans & Sutherland Code of Ethics and Business Conduct is published on our Investors Relations website at www.es.com.  We intend to disclose future amendments to certain provisions of our Code of Ethics and Business Conduct or waivers of such provisions granted to executive officers and directors on this website within four business days following the date of such amendment or waiver.

ITEM 11. EXECUTIVE COMPENSATION

The information required by this item will be included under the captions, "Executive Compensation," and, "Election of Directors," in the Proxy Statement for our 2016 Annual Meeting of Stockholders and that information is herein incorporated by reference.

43

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELaTED STOCKHOLDER MATTERS

The information required by Item 403 of Regulation S-K will be included under the caption, "Security Ownership of Certain Beneficial Owners and Management," in the Proxy Statement for our 2016 Annual Meeting of Stockholders and that information is herein incorporated by reference.

Securities Authorized for Issuance Under Equity Compensation Plans as of December 31, 2015:

					Number of securities
	Number of securities				remaining available for
	to be issued upon		Weighted average		future issuance
	exercise of		exercise price of		under equity compensation
	outstanding options,		outstanding options,		plans (excluding securities
	warrants and rights		warrants and rights		reflected in column (a))
	(a)		(b)		(c)
Equity compensation plans approved by
security holders		1,469,968	$	1.53		1,303,713
Equity compensation plans not approved by
security holders		-		-		-
Total		1,469,968	$	1.53		1,303,713

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

The information required by Item 404 of Regulation S-K will be included under the caption, "Certain Relationships and Related Party Transactions," in the Proxy Statement for our 2016 Annual Meeting of Stockholders and that information is herein incorporated by reference.  The information required by Item 407(a) of Regulation S-K will be included under the caption, "Election of Directors," in the Proxy Statement for our 2016 Annual Meeting of Stockholders and that information is herein incorporated by reference

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

The information required by this item will be included under the caption, "Report of the Audit Committee of the Board of Directors," in the Proxy Statement for our 2016 Annual Meeting of Stockholders and that information is herein incorporated by reference.

44

PART IV

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a) List of documents filed as part of this report

1.Financial Statements

The following consolidated financial statements are included in Part II, Item 8 of this report on Form 10-K.

· Consolidated Balance Sheets as of December 31, 2015 and 2014

· Consolidated Statements of Comprehensive Income (Loss) for the Years Ended December 31, 2015 and 2014

· Consolidated Statements of Stockholders' Deficit for the Years Ended December 31, 2015 and 2014

· Consolidated Statements of Cash Flows for the Years Ended December 31, 2015 and 2014

· Notes to Consolidated Financial Statements

2.Financial Statement Schedules

There are no schedules filed because of the absence of conditions under which they are required or because the required information is presented in the consolidated financial statements or the notes thereto.

3. Exhibits

Articles of Incorporation and Bylaws

3.1.1 Articles of Incorporation, as amended, filed as Exhibit 3.1 to Evans & Sutherland Computer Corporation's Annual Report on Form 10-K, SEC File No. 000-08771, for the fiscal year ended December 25, 1987, and incorporated herein by reference.

3.1.2 Amendments to Articles of Incorporation filed as Exhibit 3.1.1 to Evans & Sutherland Computer Corporation's Annual Report on Form 10-K, SEC File No. 000-08771, for the fiscal year ended December 30, 1988, and incorporated herein by reference.

3.1.3 Certificate of Designation, Preferences and Other Rights of the Class B-1 Preferred Stock of Evans & Sutherland Computer Corporation, filed as Exhibit 3.1 to Evans & Sutherland Computer Corporation's Form 10-Q, SEC File No. 000-08771, for the quarter ended September 25, 1998, and incorporated herein by reference.

3.2.1 Amended and Restated Bylaws of Evans & Sutherland Computer Corporation, filed as Exhibit 3.2 to Evans & Sutherland Computer Corporation's Form 10-K for the year ended December 31, 2000, and incorporated herein by reference.

3.2.2 Amendment No. 1 to the Amended and Restated Bylaws of Evans & Sutherland Computer Corporation, filed as Exhibit 3.3 to Evans & Sutherland Computer Corporation's Form 10-K for the year ended December 31, 2000, and incorporated herein by reference.

3.2.3 Amendment No. 2 to the Amended and Restated Bylaws of Evans & Sutherland Computer Corporation, filed as Exhibit 3.1 to Evans & Sutherland Computer Corporation's Form 8-K filed with the Commission on November 31, 2015, and incorporated herein by reference.

Material contracts

Management contracts and compensatory plans

10.1 Evans & Sutherland Computer Corporation 2004 Stock Incentive Plan, filed as Annex A to Evans & Sutherland's Form 14A, SEC File No. 001-14667, filed on April 19, 2004 and incorporated herein by reference.

10.2 Amended and Restated Evans & Sutherland Computer Corporation's Supplemental Executive Retirement Plan (SERP), dated May 16, 2002, filed as Exhibit 10.38 to Evans & Sutherland Computer Corporation's Form 10-K for the year ended December 31, 2002, and incorporated herein by reference.

45

10.3 Employment agreement between Evans & Sutherland Computer Corporation and Kirk Johnson, dated August 26, 2002, filed as Exhibit 10.14 to Evans & Sutherland Computer Corporation's Form 10-K for the year ended December 31, 2004, and incorporated herein by reference.

10.4 Employment Agreement, dated February 8, 2006, by and between Evans & Sutherland Computer Corporation and Jonathan Shaw, filed as Exhibit 10.1 to Evans & Sutherland Computer Corporation's Form 10-Q for the quarter ended June 30, 2006, and incorporated herein by reference.

10.5 Employment Agreement dated February 8, 2006, by and between Evans & Sutherland Computer Corporation and Paul Dailey, filed as Exhibit 10.2 to Evans & Sutherland Computer Corporation's Form 10-Q for the quarter ended June 30, 2006, and incorporated herein by reference.

10.6 Employment Agreement, dated August 26, 2002, by and between Evans & Sutherland Computer Corporation and David H. Bateman, filed as Exhibit 10.13 to Evans & Sutherland Computer Corporation's Form 10-K for the year ended December 31, 2006, and incorporated herein by reference.

10.7 Evans & Sutherland Computer Corporation 2014 Stock Incentive Plan, filed as Exhibit 10.1 to Evans & Sutherland Computer Corporation's Form 8-K filed with the Commission on May 16, 2014, and incorporated herein by reference.

10.8 Form of Incentive Stock Option Award Agreement under the Evans & Sutherland Computer Corporation 2014 Stock Incentive Plan, filed as Exhibit 10.2 to Evans & Sutherland Computer Corporation's Form 8-K filed with the Commission on May 16, 2014, and incorporated herein by reference.

10.9 Form of Non-Qualified Stock Option Award Agreement under the Evans & Sutherland Computer Corporation 2014 Stock Incentive Plan, filed as Exhibit 10.3 to Evans & Sutherland Computer Corporation's Form 8-K filed with the Commission on May 16, 2014, and incorporated herein by reference.

Other material contracts

10.10 Guaranty, dated April 28, 2006, by Evans and Sutherland Computer Corporation, filed as Exhibit 10.7 to Evans & Sutherland Computer Corporation's Form 10-Q for the quarter ended June 30, 2006, and incorporated herein by reference.

10.11 Pledge Agreement, dated April 28, 2006, by and between Evans & Sutherland Computer Corporation, Spitz, Inc. and First Keystone Bank, filed as Exhibit 10.8 to Evans & Sutherland Computer Corporation's Form 10-Q for the quarter ended June 30, 2006, and incorporated herein by reference.

10.12 Security Agreement, dated April 28, 2006, by and between Spitz, Inc. and First Keystone Bank, filed as Exhibit 10.9 to Evans & Sutherland Computer Corporation's Form 10-Q for the quarter ended June 30, 2006, and incorporated herein by reference.

10.13 Open-end Mortgage and Security Agreement, dated April 28, 2006, by and between Spitz, Inc. and First Keystone Bank, filed as Exhibit 10.10 to Evans & Sutherland Computer Corporation's Form 10-Q for the quarter ended June 30, 2006, and incorporated herein by reference.

10.14 Mortgage Note dated January 14, 2004, of Transnational Industries, Inc. and Spitz, Inc. to First Keystone Bank filed as Exhibit 10.25 to Evans & Sutherland Computer Corporation's Form 10-K for the year ended December 31, 2006, and incorporated herein by reference.

46

10.15 Open-End Mortgage and Security Agreement dated January 14, 2004, between Spitz, Inc. and First Keystone Bank filed as Exhibit 10.26 to Evans & Sutherland Computer Corporation's Form 10-K for the year ended December 31, 2006, and incorporated herein by reference.

10.16 Loan Agreement dated as January 14, 2004, between First Keystone Bank, Transnational Industries, Inc. and Spitz, Inc filed as Exhibit 10.27 to Evans & Sutherland Computer Corporation's Form 10-K for the year ended December 31, 2006, and incorporated herein by reference.

10.17 First Modification Agreement to Mortgage Loan Agreements, dated March 30 2007, by and between Evans & Sutherland Computer Corporation, Spitz, Inc. and First Keystone Bank, filed as Exhibit 10.28 to Evans & Sutherland Computer Corporation's Form 10-K for the year ended December 31, 2006, and incorporated herein by reference.

10.18 Guaranty, dated March 30, 2007 by Evans and Sutherland Computer Corporation, filed as Exhibit 10.30 to Evans & Sutherland Computer Corporation's Form 10-K for the year ended December 31, 2006, and incorporated herein by reference.

10.19 First Amendment to Sublease Agreement dated November 4, 2014, by and between Evans &       Sutherland Computer Corporation and Wasatch Research Park I, LLC, filed as Exhibit 10.1 to Evans & Sutherland Computer Corporation's Form 10-Q for the quarter ended September 26, 2014 and incorporated herein by reference.

10.20 Line of Credit Agreement between Spitz, Inc. and Bryn Mawr Trust Company dated March 15, 2012 filed as Exhibit 10.2 to Evans & Sutherland Computer Corporation's Form 10-Q for the quarter ended September 26, 2014 and incorporated herein by reference.

10.21 Settlement Agreement, dated April 21, 2015, between Pension Benefit Guaranty Corporation, Evans & Sutherland Computer Corporation and Spitz, Inc., filed as Exhibit 10.1 to Evans & Sutherland Computer Corporation's Form 8-K filed with the Commission on April 24, 2015, and incorporated herein by reference.

10.22 Agreement For Appointment of Trustee and Termination of Plan, dated April 21, 2015, between Pension Benefit Guaranty Corporation and Evans & Sutherland Computer Corporation, filed as Exhibit 10.1 to Evans & Sutherland Computer Corporation's Form 8-K filed with the Commission on April 24, 2015, and incorporated herein by reference.

10.23 Security Agreement, dated April 21, 2015, between Pension Benefit Guaranty Corporation, Evans & Sutherland Computer Corporation and Spitz, Inc., filed as Exhibit 10.1 to Evans & Sutherland Computer Corporation's Form 8-K filed with the Commission on April 24, 2015, and incorporated herein by reference.

10.24 Open-End Mortgage, Security Agreement, Assignment of Leases and Rents and Fixture Filing, dated April 21, 2015, executed by Spitz, Inc. in favor of Pension Benefit Guaranty Corporation, filed as Exhibit 10.1 to Evans & Sutherland Computer Corporation's Form 8-K filed with the Commission on April 24, 2015, and incorporated herein by reference.

Subsidiaries of the registrant

21.1 Subsidiaries of Registrant, filed as Exhibit 21.1 to Evans & Sutherland Computer Corporation's Form 10-K for the year ended December 31, 2007, and incorporated herein by reference.

Consent of experts and counsel

23.1 Consent of Independent Registered Public Accounting Firm, filed herein.

47

Rule 13a-14(a)/15d-14(a) Certifications

31.1 Certification of Chief Executive Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act, as amended, filed herein.

31.2 Certification of Chief Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act, as amended, filed herein.

Section 1350 Certifications

32.1 Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed herein.

TRADEMARKS USED IN THIS FORM 10-K

E&S, Digistar, SciDome and NanoSeam are trademarks or registered trademarks of Evans & Sutherland Computer Corporation.  All other product, service, or trade names or marks are the properties of their respective owners.

48

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

EVANS & SUTHERLAND COMPUTER CORPORATION

By    /s/ DAVID H. BATEMAN

David H. Bateman

Chief Executive Officer and Director

March 16, 2016

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

Signature	Title	Date
/s/           David H. Bateman	Chief Executive Officerand Director(Principal Executive Officer)	March 16, 2016
David H. Bateman
/s/           Paul L. Dailey	Chief Financial Officer(Principal Financial Officer and Principal Accounting Officer)	March 16, 2016
Paul L. Dailey
/s/           L. Tim Pierce	Director	March 16, 2016
L. Tim Pierce
/s/           William Schneider, Jr.	Director	March 16, 2016
William Schneider, Jr.
/s/           James P. McCarthy	Director	March 16, 2016
James P. McCarthy
/s/           E. Michael Campbell	Director	March 16, 2016
E. Michael Campbell
/s/           William E. Stringham	Director	March 16, 2016
William E. Stringham

49

EX-31.1

Exhibit 31.1

Rule 13a-14 Certification

CERTIFICATIONS*

I, David H. Bateman, certify that:

1. I have reviewed this annual report on Form 10-K of Evans & Sutherland Computer Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: March 16, 2016

/s/ David H. BatemanDavid H. BatemanChief Executive Officer (Principal Executive Officer)

EX-31.2

Exhibit 31.2

Rule 13a-14 Certification

CERTIFICATIONS*

I, Paul L. Dailey, certify that:

1. I have reviewed this annual report on Form 10-K of Evans & Sutherland Computer Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: March 16, 2016

/s/ Paul L. DaileyPaul L. Dailey Chief Financial Officer (Principal Financial Officer)

EX-32.1

Exhibit 32.1

Certification Pursuant to 18 U.S.C. 1350,

 as Adopted Pursuant Section 906 of the

Sarbanes-Oxley Act of 2002

I, David H. Bateman, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Form 10-K of Evans & Sutherland Computer Corporation for the fiscal year ended December 31, 2015, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Form 10-K fairly presents, in all material respects, the financial condition and results of operations of Evans & Sutherland Computer Corporation.

Date: March 16, 2016	By:     /s/ David H. Bateman
	David H. Bateman
	Chief Executive Officer

I, Paul L. Dailey, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Form 10-K of Evans & Sutherland Computer Corporation for the fiscal year ended December 31, 2015, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Form 10-K fairly presents, in all material respects, the financial condition and results of operations of Evans & Sutherland Computer Corporation.

Date: March 16, 2016	By:     /s/ Paul L. Dailey
	Paul L. Dailey
	Chief Financial Officer

The foregoing certifications are being furnished solely to accompany the Report pursuant to 18 U.S.C. §1350, and are not being filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and are not to be incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

XML

Document and Entity Information - USD ($)	12 Months Ended
	Dec. 31, 2015	Mar. 01, 2016	Jun. 30, 2015
Document and Entity Information:
Entity Registrant Name	EVANS & SUTHERLAND COMPUTER CORPORATION
Document Type	10-K
Document Period End Date	Dec. 31, 2015
Amendment Flag	false
Entity Central Index Key	0000276283
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		11,177,316
Entity Filer Category	Smaller Reporting Company
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	FY
Entity Public Float			$ 4,149,143
Trading Symbol	escc

XML

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Current assets:
Cash and cash equivalents	$ 3,734	$ 7,038
Restricted cash	601	711
Accounts receivable, net	4,825	4,586
Costs and estimated earnings in excess of billings on uncompleted contracts	2,695	1,699
Inventories, net	4,072	4,163
Prepaid expenses and deposits	1,038	635
Total current assets	16,965	18,832
Property and equipment, net	4,735	4,803
Goodwill	635	635
Intangible assets, net	27	68
Other assets	1,082	1,118
Total Assets	23,444	25,456
Current liabilities:
Accounts payable	1,062	710
Accrued liabilities	1,031	1,142
Billings in excess of costs and estimated earnings on uncompleted contracts	3,995	5,176
Customer deposits	3,232	4,081
Current portion of retirement obligations	480	535
Current portion of pension settlement obligation	356
Current portion of long-term debt	199	2,362
Total current liabilities	10,355	14,006
Pension and retirement obligations, net of current portion	4,839	40,076
Pension settlement obligation, net of current portion	5,268
Long-term debt, net of current portion	1,975	0
Deferred rent obligation	1,653	2,077
Total liabilities	$ 24,090	$ 56,159
Commitments and contingencies (Notes 4, 5, 6 and 8)
Stockholders' deficit:
Preferred stock, no par value: 10,000,000 shares authorized; no shares outstanding
Common stock, $0.20 par value: 30,000,000 shares authorized; 11,441,666 shares issued	$ 2,288	$ 2,288
Additional paid-in-capital	53,434	54,500
Common stock in treasury, at cost, 264,350 and 352,467 shares, respectively	(3,532)	(4,709)
Accumulated deficit	(50,432)	(49,157)
Accumulated other comprehensive loss	(2,404)	(33,625)
Total stockholders' deficit	(646)	(30,703)
Total liabilities and stockholders' deficit	$ 23,444	$ 25,456

XML

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Dec. 31, 2015	Dec. 31, 2014
Statement of Financial Position
Preferred Stock, par value
Preferred Stock, shares authorized	10,000,000	10,000,000
Preferred Stock, shares outstanding
Common Stock, par value	$ 0.20	$ 0.20
Common Stock, shares authorized	30,000,000	30,000,000
Common Stock, shares issued	11,441,666	11,441,666
Common stock in treasury, shares	264,350	352,467

XML

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Statement of Comprehensive Income
Sales	$ 35,298	$ 26,466
Cost of sales	(22,956)	(16,989)
Gross profit	12,342	9,477
Operating expenses:
Selling, general and administrative	(6,633)	(6,873)
Research and development	(2,262)	(2,187)
Pension	(522)	(1,147)
Pension settlement	(3,620)
Total operating expenses	(13,037)	(10,207)
Operating loss	(695)	(730)
Interest expense	(429)	(629)
Other income (expense), net	(163)	77
Loss before income tax benefit (provision)	(1,287)	(1,282)
Income tax benefit (provision)	12	(23)
Net loss	$ (1,275)	$ (1,305)
Net loss per common share - basic and diluted	$ (0.11)	$ (0.12)
Weighted average common shares outstanding - basic	11,150	11,089
Weighted average common shares outstanding - diluted	11,150	11,089
Comprehensive income (loss), net of tax:
Net loss	$ (1,275)	$ (1,305)
Reclassification of pension expense to net loss		406
Pension settlement	31,776
Increase in minimum pension liability	(555)	(16,422)
Other comprehensive income (loss)	31,221	(16,016)
Total comprehensive income (loss)	$ 29,946	$ (17,321)

XML

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT - USD ($) shares in Thousands, $ in Thousands	Common Stock	Additional Paid-in Capital	Treasury Stock	Accumulated Deficit	Accumulated Other Comprehensive Loss	Total
Stockholders' Deficit, beginning of period, Value at Dec. 31, 2013	$ 2,288	$ 54,484	$ (4,709)	$ (47,852)	$ (17,609)	$ (13,398)
Stockholders' Deficit, beginning of period, Shares at Dec. 31, 2013	11,442
Net loss				(1,305)		(1,305)
Other comprehensive income (loss)					(16,016)	(16,016)
Stock-based compensation		16				16
Stockholders' Deficit, end of period, Value at Dec. 31, 2014	$ 2,288	54,500	(4,709)	(49,157)	(33,625)	(30,703)
Stockholders' Deficit, end of period, Shares at Dec. 31, 2014	11,442
Net loss				(1,275)		(1,275)
Issuance of 88,117 shares from treasury for pension settlement		(1,107)	1,177			70
Other comprehensive income (loss)					31,221	31,221
Stock-based compensation		41				41
Stockholders' Deficit, end of period, Value at Dec. 31, 2015	$ 2,288	$ 53,434	$ (3,532)	$ (50,432)	$ (2,404)	$ (646)
Stockholders' Deficit, end of period, Shares at Dec. 31, 2015	11,442

XML

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Cash flows from operating activities:
Net loss	$ (1,275)	$ (1,305)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	291	465
Amortization of deferred pension costs	106	406
Pension settlement charge	3,620
Provision for excess and obsolete inventory	155	197
Other	166	190
Changes in assets and liabilities:
Decrease in restricted cash	110	309
Decrease (increase) in accounts receivable	(373)	979
Increase in inventories	(64)	(1,335)
Decrease (increase) in costs and estimated earnings in excess of excess of billings on uncompleted contracts, net	(2,177)	2,510
Decrease (increase) in prepaid expenses and other assets	(367)	326
Increase (decrease) in accounts payable	352	(723)
Decrease in accrued liabilities	(111)	(29)
Increase (decrease) in accrued pension and retirement liabilities	(84)	91
Decrease in pension settlement obligation	(2,019)
Increase (decrease) in customer deposits	(849)	1,924
Decrease in deferred rent obligation	(424)
Net cash provided by (used in) operating activities	(2,943)	4,005
Cash flows from investing activities:
Purchases of property and equipment	(182)	(395)
Proceeds from sale of property and equipment	9
Proceeds from sale of marketable securities		229
Net cash used in investing activities	(173)	(166)
Cash flows from financing activities:
Principal payments on long-term debt	(188)	(177)
Net cash used in financing activities	(188)	(177)
Net increase (decrease) in cash and cash equivalents	(3,304)	3,662
Cash and cash equivalents as of beginning of the year	7,038	3,376
Cash and cash equivalents as of end of the year	3,734	7,038
Supplemental disclosures of non-cash investing and financing activities
Settlement of pension liability	35,870
Increase in minimum pension and retirement obligations	661	16,422
Disposal of building and accrued lease obligations		9,378
Supplemental disclosures of cash flow information
Cash paid during the year for: Interest	364	425
Cash paid during the year for: Income taxes	$ 12	$ 22

XML

Note 1 - Nature of Operations and Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2015

Notes

Note 1 - Nature of Operations and Summary of Significant Accounting Policies

Note 1 - Nature of Operations and Summary of Significant Accounting Policies

Nature of Operations

Evans & Sutherland Computer Corporation, referred to in these notes as "Evans & Sutherland," "E&S," or the "Company," produces high-quality advanced visual display systems used primarily in full-dome video projection applications, dome projection screens and dome architectural treatments. E&S also produces unique content for planetariums, schools, science centers and other educational institutions and entertainment venues.  The Company's products include state of the art planetarium and dome theater systems consisting of proprietary hardware and software, and other unique visual display systems primarily used to project digital video on large curved surfaces.  Additionally, E&S manufactures and installs metal domes with customized optical coatings and acoustical properties that are used for planetarium and dome theaters as well as many other unique custom applications.  The Company operates in one business segment, which is the visual simulation market.

Basis of Presentation

The consolidated financial statements include the accounts of Evans & Sutherland and its wholly owned subsidiaries.  All inter-company accounts and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes.  The accounting estimates that require management's most difficult and subjective judgments include revenue recognition based on the percentage-of-completion method, inventory reserves, allowance for doubtful accounts receivable, allowance for deferred income tax assets, impairment of long-lived assets, pension and retirement obligations and useful lives of depreciable assets.  Actual results could differ from those estimates.

Cash and Cash Equivalents

The Company considers all highly liquid investments with original maturities of three or fewer months to be cash equivalents.  The Company maintains cash balances in bank accounts that, at times, exceed federally insured limits.  The Company has not experienced any losses in these accounts and believes it is not exposed to any significant risk with respect to cash.  As of December 31, 2015, cash deposits as reported by the banks, including restricted cash, exceeded the federally insured limits by approximately $4,022.

Restricted Cash

Restricted cash that guarantees letters of credit that mature or expire within one year is reported as a current asset.  Restricted cash that guarantees letters of credit that mature or expire after more than one year is reported as a long-term asset.  There was no restricted cash included in other assets as of December 31, 2015 and 2014.

Trade Accounts Receivable

In the normal course of business, E&S provides unsecured credit terms to its customers.  Accordingly, the Company maintains an allowance for doubtful accounts for possible losses on uncollectible accounts receivable.  The Company routinely analyzes accounts receivable and costs and estimated earnings in excess of billings, and considers history, customer creditworthiness, facts and circumstances specific to outstanding balances, current economic trends, and changes in payment terms when evaluating the adequacy of the allowance for doubtful accounts receivable.  Changes in these factors could result in material differences to bad debt expense.  Past due balances are determined based on contractual terms and are reviewed individually for collectability. Uncollectible accounts receivable are charged against the allowance for doubtful accounts when management determines the probability of collection is remote.

The table below represents changes in E&S's allowance for doubtful accounts receivable for the years ended December 31:

	2015	2014
Beginning balance	$217	$277
Write-off of accounts receivable	(64)	(47)
Increase (decrease) in estimated losses on accounts receivable	133	(13)
Ending balance	$286	$217

Inventories

Inventories include materials at standard costs, which approximate actual costs, as well as inventoried costs on programs and long-term contracts.  Inventoried costs include material, direct engineering and production costs, and applicable overhead, not in excess of estimated realizable value.  Spare parts and general stock materials are stated at cost not in excess of realizable value.  E&S periodically reviews inventories for excess supply, obsolescence, and valuations above estimated realizable amounts, and provides a reserve sufficient to reduce inventories to net realizable values.  Revisions of these estimates could impact net loss.

During the years ended December 31, 2015 and 2014, E&S recognized impairment losses on inventory of $155 and $197, respectively.

Inventories as of December 31, were as follows:

	2015	2014
Raw materials	$5,958	$5,468
Work in process	1,265	1,678
Finished goods	220	233
Reserve for obsolete inventory	(3,371)	(3,216)
Inventories, net	$4,072	$4,163

Property and Equipment

Property and equipment are stated at cost.  Depreciation and amortization are computed using the straight-line method based on the estimated useful lives of the related assets.  Expenditures that materially increase values or capacities or extend useful lives of property and equipment are capitalized.  Leasehold improvements are assigned useful lives based on the shorter of their useful lives or the term of the related leases, including renewal options likely to be exercised.  Routine maintenance, repairs and renewal costs are expensed as incurred.  When property is retired or otherwise disposed of, the carrying values are removed from the property and equipment and related accumulated depreciation and amortization accounts.  Depreciation and amortization are included in cost of sales, research and development or selling, general and administrative expenses depending on the nature of the asset.

Depreciation expense was $250 and $418 for the years ended December 31, 2015 and 2014, respectively.  The cost and estimated useful lives of property and equipment and the total accumulated depreciation and amortization were as follows as of December 31:

	Estimated
	Useful Lives	2015	2014
Land	n/a	$2,250	$2,250
Buildings and improvements	5 - 40 years	3,028	3,028
Manufacturing machinery and equipment	3 - 8 years	5,301	5,183
Office furniture and equipment	3 - 8 years	779	779
Total		11,358	11,240
Less accumulated depreciation and amortization		(6,623)	(6,437)
Net property and equipment		$4,735	$4,803

Goodwill

The Company tests its recorded goodwill for impairment on an annual basis during the fourth quarter, or more often if indicators of potential impairment exist, by determining if the carrying value of each reporting unit exceeds its estimated fair value. Factors that could trigger impairment include, but are not limited to, underperformance relative to historical or projected future operating results, significant changes in the manner of use of the acquired assets or the Company's overall business and significant negative industry or economic trends. Future impairment reviews may require write-downs in the Company's goodwill and could have a material adverse impact on the Company's operating results for the periods in which such write-downs occur.

Intangible Assets

E&S amortizes the cost of intangible assets over their estimated useful lives. Amortizable intangible assets are reviewed at least annually to determine whether events and circumstances warrant a revision to the remaining period of amortization.  Amortization expense was $41 and $47 for the years ended December 31, 2015 and 2014, respectively.

Software Development Costs

Software development costs, if material, are capitalized from the date technological feasibility is achieved until the product is available for general release to customers.  Such costs were not material for the years presented.

Impairment of Long-Lived Assets

Long-lived assets are reviewed for impairment when events or changes in circumstances indicate the carrying values of the assets may not be fully recoverable. When this occurs, the Company reviews the values assigned to long-lived assets by analyzing the anticipated, undiscounted cash flows they generate.  When the expected future undiscounted cash flows from these assets do not exceed their carrying values, the Company estimates the fair values of such assets. Impairment is recognized to the extent the carrying values of the assets exceed their estimated fair values.  Assets held for sale are reported at the lower of their carrying values or fair values less costs to sell.

Warranty Reserve

E&S provides a warranty reserve for estimated future costs of servicing products under warranty agreements extending for periods from 90 days to one year.  Anticipated costs for product warranties are based upon estimates derived from experience factors and are recorded at the time of sale or over the period revenues are recognized for long-term contracts.  Warranty reserves are classified as accrued liabilities in the accompanying consolidated balance sheets.

The table below represents changes in E&S's warranty reserve for the years ended December 31:

	2015	2014
Beginning balance	$125	$150
Additions to warranty reserve	149	98
Warranty costs	(147)	(123)
Ending balance	$127	$125

Revenue Recognition

Sales include revenues from system hardware, software, database products and service contracts.  The following table provides information on revenues by recognition method applied during the years:

	2015	2014
Percentage of completion	$19,827	$14,085
Completed contract	13,653	10,670
Other	1,818	1,711
Total sales	$35,298	$26,466

The following methods are used to record revenue:

Percentage of Completion. In arrangements that are longer in term and require significant production, modification or customization, revenue is recognized using the percentage-of-completion method.  In applying this method,  the Company utilizes the cost-to-cost methodology whereby it estimates the percent complete by calculating the ratio of costs incurred (consisting of material, labor and subcontracting costs, as well as an allocation of indirect costs) to its estimate of total anticipated costs.   This ratio is then utilized to determine the amount of gross profit earned based on its estimate of total gross profit at completion.  The Company routinely reviews estimates related to percentage-of-completion contracts and adjusts for changes in the period the revisions are made.  Billings on uncompleted percentage-of-completion contracts may be greater than or less than incurred costs and estimated earnings, and are recorded as an asset or liability in the accompanying consolidated balance sheets.

Completed Contract. Contract arrangements which typically require a relatively short period of time to complete the production, modification, and customization of products are accounted for using the completed contract method.  Accordingly, revenue is recognized upon delivery of the completed product, provided persuasive evidence of an arrangement exists, title and risk of loss have transferred, the fee is fixed or determinable, and collection is reasonably assured.

Multiple Element Arrangements.  Some contracts include multiple elements.  Significant deliverables in such arrangements commonly include various hardware components of visual display systems, domes, show content and various service and maintenance elements.  Revenue earned on elements such as products, services and maintenance contracts are allocated to each element based on the relative fair values of the elements.  Relative fair values of elements are generally determined based on actual and estimated selling price.  Delivery times of such contracts typically occur within a three to six-month time period.

Other.  Other revenue consists primarily of amounts earned under maintenance contracts that are generally sold as a single element to customers.  Revenue from product maintenance contracts, including separately priced extended warranty contracts, is deferred and recognized over the period of performance under the contract.

Anticipated Losses.  For contracts with anticipated losses at completion, a provision is recorded when the loss is probable.  After an anticipated loss is recorded, subsequent revenue and cost of sales are recognized in equal, offsetting amounts as contract costs are incurred.

Net Loss per Common Share

Net loss per common share is computed based on the weighted-average number of common shares and, as appropriate, dilutive common stock equivalents outstanding during the year.  Stock options are common stock equivalents.

Basic loss per common share is based upon the average number of shares of common stock outstanding during the year. Potentially dilutive securities from stock options are discussed in Note 9.

Income Taxes

The Company uses the asset and liability method of accounting for income taxes.  Under the asset and liability method, deferred income tax assets and liabilities are recognized for the future income tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective income tax bases and operating loss and income tax credit carry-forwards.  Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred income tax assets and liabilities of a change in income tax rates is recognized in the period that includes the enactment date.

Other Comprehensive Loss

On a net basis for 2015 and 2014, there were deferred income tax assets resulting from items reflected in comprehensive loss.  However, E&S has determined that it is more likely than not that it will not realize such net deferred income tax assets and has therefore established a valuation allowance against the full amount of the net deferred income tax assets.  Accordingly, the net income tax effect of the items included in other comprehensive income (loss) is zero.  Therefore, the Company has included no income tax expense or benefit in relation to items reflected in other comprehensive income (loss).

The components of accumulated other comprehensive loss were as follows as of December 31:

	2015	2014
Additional minimum pension liability	$(2,404)	$(33,625)
Total accumulated other comprehensive loss	$(2,404)	$(33,625)

Leases

The Company recognizes scheduled rent increases on a straight-line basis over the lease term, which may include optional lease renewal terms. Deferred rent income and expense are recognized to reflect the difference between the rent paid or received in the current period and the calculated straight-line amount.

Recent Accounting Pronouncements

In November 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update No. 2015-17, Income Taxes (Topic 740) ("ASU 2015-17").  ASU 2015-17 requires that all deferred income tax assets and liabilities be classified as non-current.  ASU 2015-17 is not effective until the 2017 fiscal year.  The Company is currently assessing the impact, if any, on its financial reporting of implementing this guidance.

In April 2015, the FASB issued ASU No. 2015-03, Interest – Imputation of Interest (Subtopic 835-30), Simplifying the Presentation of Debt Issuance Costs ("ASU 2015-03").  To simplify presentation of debt issuance costs, the amendments in ASU 2015-03 require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts.  The recognition and measurement guidance for debt issuance costs are not affected by the amendments in ASU 2015-03.  For public companies, ASU 2015-03 is effective for financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years.  Early adoption is permitted for financial statements that have not been previously issued.  The Company is currently assessing the impact, if any, on its financial reporting of implementing this guidance.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers ("ASU 2014-09"). ASU 2014-09 provides for a single, principles-based model for revenue recognition that replaces existing revenue

recognition guidance. ASU 2014-09 is effective for annual and interim periods beginning on or after December 15, 2016. It permits the use of either a retrospective or cumulative effect transition method and early adoption is not permitted. The Company has not yet selected a transition method and is in the process of evaluating the effect ASU 2014-09 will have on its consolidated financial statements and related disclosures.  During 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers: Deferral of the Effective Date ("ASU 2015-14"), which deferred the date of ASU 2014-09 by one year.

In August 2014, the FASB issued ASU No. 2014-15, Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern ("ASU 2014-15"). This standard sets forth management's responsibility to evaluate, each reporting period, whether there is substantial doubt about the entity's ability to continue as a going concern, and if so, to provide related note disclosures. ASU 2014-15 is effective for annual reporting periods beginning after December 15, 2016, and interim periods within annual periods ending after December 15, 2016. The Company is currently assessing the impact, if any, on its financial reporting of implementing this guidance.

Liquidity

The Company has experienced recurring annual losses since 2007, except for 2013. On April 21, 2015, the Company executed an agreement (the "Pension Settlement Agreement") which terminated its defined benefit pension plan (the "Pension Plan") and settled the Pension Plan's liabilities in exchange for an obligation to pay to the Pension Benefit Guaranty Corporation ("PBGC") $10,500 over twelve years and issue to the PBGC 88,117 shares of E&S treasury stock (see Note 5). In addition, the Pension Settlement Agreement has led to a new banking relationship and improved credit capacity. Aided by prior cost reduction efforts and improved sales volume, for the year ended December 31, 2015, the Company has generated profitable results before recording the pension expense and a charge for the settlement of the Pension Plan. The Company is no longer incurring expenses related to the terminated Pension Plan but as of December 31, 2015 is responsible for eleven annual installment payments of $750 to the PBGC. Management believes that the Company's unrestricted cash balances totaling $3,734 as of December 31, 2015 and improved credit capacity and forecasted operations provide sufficient resources to meet the Company's obligations, including the terms of the Pension Settlement Agreement, through at least the end of 2016.

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Note 2 - Definite-lived Intangible Assets and Goodwill

12 Months Ended

Dec. 31, 2015

Notes

Note 2 - Definite-lived Intangible Assets and Goodwill

Note 2 – Definite-Lived Intangible Assets and Goodwill

Definite-lived intangible assets consisted of the following as of December 31, 2015 and 2014:

		December 31,
		2015		2014
	Weighted Avg. Amortization Period in Years	Gross Carrying Amount	Accumulated Amortization	Gross Carrying Amount	Accumulated Amortization
Class
Maintenance and legacy customers	10	$350	$(335)	$350	$(308)
Planetarium shows	10	280	(268)	280	(254)
Total		$630	$(603)	$630	$(562)

Amortization expense for the years ended December 31, 2015 and 2014 was $41 and $47, respectively.

Maintenance and legacy customers and planetarium shows represent the value of definite-lived intangibles that were identified in the acquisition of Spitz in 2006.

The remaining balance of definite-lived intangible assets is expected to be amortized to expense in 2016.

Goodwill of $635 resulted from the acquisition of the Company's wholly owned subsidiary, Spitz, and was measured as the excess of the $2,884 purchase consideration paid over the fair value of the net assets acquired. The Company has made its annual assessment of impairment of goodwill and has concluded that goodwill is not impaired as of December 31, 2015.

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Note 3 - Costs and Estimated Earnings On Uncompleted Contracts

12 Months Ended

Dec. 31, 2015

Notes

Note 3 - Costs and Estimated Earnings On Uncompleted Contracts

Note 3 - Costs and Estimated Earnings on Uncompleted Contracts

Comparative information with respect to uncompleted contracts as of December 31:

	2015	2014
Total accumulated costs and estimated earnings on uncompleted contracts	$33,445	$29,629
Less total billings on uncompleted contracts	(34,745)	(33,106)
Ending balance	$(1,300)	$(3,477)

The above amounts are reported in the consolidated balance sheets as of December 31 as follows:

	2015	2014
Costs and estimated earnings in excess of billings on uncompleted contracts	$2,695	$1,699
Billings in excess of costs and estimated earnings on uncompleted contracts	(3,995)	(5,176)
Ending balance	$(1,300)	$(3,477)

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Note 4 - Leases and Gain On Disposal of Building Assets

12 Months Ended

Dec. 31, 2015

Notes

Note 4 - Leases and Gain On Disposal of Building Assets

Note 4 – Leases and gain on disposal of building assets

The Company occupies real property and uses certain equipment under lease arrangements that are accounted for as operating leases.  The Company's real property leases contain escalation clauses.  Rental expense for all operating leases for 2015 and 2014 was $216 and $230, respectively.

On November 4, 2014, the Company agreed to an extension of its real estate lease for its corporate office buildings for a term of 5 years. The previous lease term included a repurchase option and was recorded as a financing obligation (see Note 6). Under the lease extension, the repurchase option expired and the extended lease term is recorded as an operating lease. Base annual rent for the extended 5-year term is $549.

The extension of the lease for five years without a repurchase option was recorded as a disposal of building assets with a book value of $2,532. The extinguishment of the lease obligation recorded as debt in the amount of $3,152 represented consideration received for the disposal. The disposal of the building assets and extinguishment of the lease financing obligation resulted in a gain on the disposal of the building assets in the amount of $620. Accounting for a sale leaseback transaction was applied and, as a result, the $620 gain on the disposal of the building assets was deferred and will be recognized ratably, as a credit against rent expense, over the five-year term of the new operating lease. The amount of the gain on the building asset disposal recognized in 2014 was $21.

There was also a deferred rent credit of $1,526 which was extinguished as a result of the new operating lease. The deferred rent credit represented previously recorded but unpaid rent expense for the prior long-term land lease in accordance with straight-line lease accounting. Because, under the new five-year operating lease, the Company will no longer be obligated or expected to pay the unpaid rent expense reflected in the deferred rent credit, the $1,526 balance is extinguished and represents additional gain as a result of the new lease extension.  The $1,526 gain from the extinguishment of the deferred rent credit will be recognized ratably over the five-year term as a credit against rent expense of the new operating lease. The amount of the gain from the extinguishment of the deferred rent credit recognized in 2014 was $51305.

Future minimum rent expense payments under the new operating lease and the remaining deferred gain from the disposal of the building assets and deferred rent credit to be recognized are as follows:

Years Ending December 31,	Rent Expense	Gain on Building	Deferred Rent Credit	Net Rent  Expense
2016	$549	$(124)	$(305)	$120
2017	549	(124)	(305)	120
2018	565	(124)	(305)	136
2019	475	(106)	(260)	109
Total	$2,138	$(478)	$(1,175)	$485

There are no other lease obligations that have initial or remaining non-cancelable lease terms in excess of one year.

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Note 5 - Employee Retirement Benefit Plans

12 Months Ended

Dec. 31, 2015

Notes

Note 5 - Employee Retirement Benefit Plans

Note 5 - Employee Retirement Benefit Plans

Settlement of Pension Plan Liabilities

On January 7, 2013, the Company submitted a PBGC Form 600 Distress Termination, Notice of Intent to Terminate, to the PBGC. The notice filing initiated an application process by the Company with the PBGC for the distress termination of the Pension Plan. The Pension Plan benefits are guaranteed by the ERISA Title IV insurance fund, which is administered by the PBGC. The Company proposed a termination date of March 8, 2013. Through the application process, the Company's intent was to demonstrate to the PBGC that it qualified for a distress termination of the Pension Plan under either of two of the criteria of Section 4041(c)(2) of ERISA (inability to continue in business absent termination and unreasonably increased pension costs) and applicable PBGC regulations. To satisfy the criteria, the Company and its wholly owned subsidiary each had to demonstrate to the satisfaction of the PBGC that, unless the termination occurred, the Company would be unable to pay its debts when they came due and would be unable to continue in business, or that the costs of the Pension Plan had become unreasonably burdensome solely as a result of a decline in the workforce covered by the Pension Plan. A distress termination under Section 4041(c)(2) of ERISA transfers the Pension Plan's benefit obligations to the PBGC, up to ERISA guaranteed limits, without requiring reorganization under bankruptcy law. The Pension Plan's actuary informed the Company that following termination of the Pension Plan and subject to the PBGC's review of participant benefits, all of the benefits earned by participants as of the date of plan termination are expected to fall within ERISA guaranteed limits.

The Company's goal in seeking a distress termination of the Pension Plan was to ensure that the pension benefits of all Pension Plan participants are paid up to federally guaranteed limits and that the Company continues to operate as a going concern while avoiding the costly damage and disruption to the business which would result from reorganization.

Pursuant to a determination by the PBGC that the requirements of the distress termination of the Pension Plan had been met, on April 21, 2015, the Company, as the administrator of the Pension Plan, and the PBGC entered into an Agreement For Appointment of Trustee and Termination of Plan (the "Termination Agreement") (a) terminating the Plan, (b) establishing March 8, 2013 as the Plan's termination date and (c) appointing the PBGC as statutory trustee of the Plan.

In connection with the Termination Agreement, on April 21, 2015, the Company entered into the Pension Settlement Agreement with the PBGC to settle all liabilities of the Pension Plan including any termination premium resulting from the Pension Plan termination (the "Settled ERISA Liabilities"). Pursuant to the Pension Settlement Agreement, the Company agreed to (a) pay to the PBGC a total of $10,500, with $1,500 due within ten days following the effective date of the Pension Settlement Agreement and the remainder paid in twelve annual installments of $750 beginning on October 31, 2015 (the "Pension Settlement Obligation") and (b) issue within ten days following the effective date of the Pension Settlement Agreement 88,117 shares of the Company's treasury stock in the name of the PBGC. On April 23, 2015, the Company issued to the PBGC the 88,117 shares of stock and on May 1, 2015 it paid the initial $1,500 amount due to the PBGC. On October 22, 2015, the Company made the first of the twelve annual installments.  The Pension Settlement Agreement further provides that the PBGC will be deemed to have

released the Company from all Settled ERISA Liabilities upon payment of the Pension Settlement Obligation. In the event of a default by the Company of its obligations under the Pension Settlement Agreement or the underlying agreements which secure the Pension Settlement Obligation, the PBGC may enforce payment of the Settled ERISA Liabilities, which would accrue interest at various rates until payment is made and be reduced by any payments made by the Company pursuant to the Pension Settlement Agreement.  The estimated total Settled ERISA Liabilities as of the settlement date is $46,000.

To secure the Company's obligations under the Pension Settlement Agreement, on April 21, 2015, the Company also entered into a Security Agreement with the PBGC (the "Security Agreement"), and executed an Open-End Mortgage in favor of the PBGC (the "Mortgage") on certain real property owned by the Company's subsidiary, Spitz, Inc. ("Spitz"). The Security Agreement and Mortgage grant to the PBGC a security interest on all of the Company's presently owned and after-acquired property and proceeds thereof, free and clear of all liens and other encumbrances, except those described therein (the "Senior Liens"). The PBGC's security interest in the Company's property is subordinate to the Company's two senior lenders pursuant to the Security Agreement and agreements between the PBGC and the lenders (the "Intercreditor Agreements"). The Intercreditor Agreements provide for the lenders to extend credit to the Company, secured by the Senior Liens, up to specified limits. The Intercreditor Agreement between the lender of the mortgage notes and line of credit (see Note 6) and the PBGC provides for total aggregate loans of up to $6,500 secured by Senior Liens on Spitz assets. The second Intercreditor Agreement between another lender and the PBGC provides for up to $3,000 of letter of credit indebtedness secured by Senior Liens on cash deposits. The Pension Settlement Agreement also required that the PBGC withdraw all lien notices with respect to the statutory liens it previously perfected on behalf of the Pension Plan with respect to all real and personal property of the Company as soon as reasonably practicable after the 91st day after the perfection of all consensual liens granted to the PBGC by the Security Agreement and Mortgage.  In August 2015, the PBGC's lien notices with respect to the statutory liens were withdrawn.

The termination of the Pension Plan and settlement of its underlying liabilities enables the Company to satisfy the previously disclosed unfunded liability attributable to the Pension Plan by the issuing to the PBGC the 88,117 shares of stock from treasury and making the fixed installment payments of the Pension Settlement Obligation. As of the date of the Pension Settlement Agreement, the balance of the unfunded liability attributable to the Pension Plan, which was previously reported with Pension and Retirement Obligations, was $35,870, of which $31,776 was attributable to accumulated other comprehensive loss. The market value of the 88,117 shares of stock issued to the PBGC from treasury on April 23, 2015 was $70. The Pension Settlement Obligation was recorded as a liability of the Company as of April 21, 2015 in the amount of $7,643, reflecting the present value of the installments at an interest rate of 7%, which the Company believes represents the fair market interest rate for junior secured debt with similar secured terms of the Security Agreement. The unfunded Pension Plan liability of $35,870 exceeded the $7,714 combined value of the stock issued to the PBGC and the Pension Settlement Obligation by $28,156. There are no income tax consequences of the settlement since no tax deduction was taken for the pension expense that gave rise to the Pension Plan liability. Accordingly, the settlement of the Pension Plan Liabilities was recorded as of April 21, 2015 as follows:

Unfunded Pension Plan Liability	$35,870
Market value of common shares issued from treasury	(70)
Pension Settlement Obligation	(7,644)
Total consideration to PBGC	(7,714)
Total gain from settlement of Pension Plan Liabilities	$28,156
Gain recorded as:
Charge to statement of operations	$(3,620)
Other comprehensive Income	31,776
Contribution to total comprehensive income	$28,156

After applying the first $1,500 installment made on May 1, 2015, and the first annual installment on October 22, 2015, and recording imputed interest expense at 7%, the balance of the Pension Settlement Obligation is recorded with liabilities on the balance sheet as follows as of December 31, 2015:

Current portion of pension settlement obligation	$356
Pension settlement obligation, net of current portion	5,268
Total Pension Settlement Obligation	$5,624

As a result of the settlement of Pension Plan liabilities on April 21, 2015, the Company's only remaining pension obligation is the Supplemental Executive Retirement Plan ("SERP"). The Company recorded expense of $326 related to the Pension Plan for the first quarter prior to the Termination Agreement executed on April 21, 2015.

Supplemental Executive Retirement Plan

The SERP provides eligible executives defined pension benefits, outside the Pension Plan, based on average salary, years of service and age at retirement.  The SERP was amended in 2002 to discontinue further SERP gains from future salary increases and close the SERP to new participants.

401(k) Deferred Savings Plan

The Company has a deferred savings plan that qualifies under Section 401(k) of the Internal Revenue Code.  The 401(k) plan covers all employees of the Company who have at least one year of service and who are age 18 or older.  Matching contributions are made on employee contributions after the employee has achieved one year of service.  Extra matching contributions can be made based on profitability and other financial and operational considerations.  No extra matching contributions have been made to date.  Contributions to the 401(k) plan for 2015 and 2014 were $168 and $197, respectively.

Obligations and Funded Status for Pension Plan and SERP

E&S uses a December 31 measurement date for both the Pension Plan and the SERP.

Information concerning the obligations, plan assets and funded status of employee retirement defined benefit plans are provided below:

	Pension Plan		SERP
	2015	2014	2015	2014
Changes in benefit obligation
Projected benefit obligation - beginning of year	$64,831	$48,091	$4,871	$4,846
Service cost	-	-	-	-
Interest cost	617	2,275	177	218
Actuarial loss	1,690	14,942	769	308
Benefits paid	(339)	(477)	(497)	(501)
Transfer of benefit obligation upon termination	(66,799)	-	-	-
Projected benefit obligation - end of year	$-	$64,831	$5,320	$4,871

	Pension Plan		SERP
Changes in plan assets	2015	2014	2015	2014
Fair value of plan assets - beginning of year	$29,721	$29,073	$-	$-
Actual return on plan assets	1,547	1,125	-	-
Contributions	-	-	497	501
Benefits paid	(339)	(477)	(497)	(501)
Transfer out upon termination	(30,929)	-	-	-
Fair value of plan assets - end of year	$-	$29,721	$-	$-

	Pension Plan		SERP
	2015	2014	2015	2014
Net amount recognized
Unfunded status	$-	$(35,111)	$(5,320)	$(4,871)
Accrued PBGC insurance premiums	-	(629)	-	-
Unrecognized net actuarial loss	-	31,971	2,415	1,713
Unrecognized prior service cost	-	-	(11)	(59)
Net amount recognized	$-	$(3,769)	$(2,916)	$(3,217)

Amounts recognized in the consolidated balance sheets consisted of:

	Pension Plan		SERP
	2015	2014	2015	2014
Accrued liability	$-	$(35,111)	$(5,320)	$(4,871)
Accrued PBGC insurance premiums	-	(629)	-	-
Accumulated other comprehensive loss	-	31,971	2,404	1,654
Net amount recognized	$-	$(3,769)	$(2,916)	$(3,217)

Components of net periodic benefit cost:

	Pension Plan		SERP
	2015	2014	2015	2014
Service cost	$-	$-	$-	$-
Interest cost	617	2,275	177	218
Expected return on assets	(585)	(2,298)	-	-
Amortization of actuarial loss	195	406	68	50
Amortization of prior year service cost	-	-	(49)	(49)
Net periodic benefit expense	227	383	196	219
Insurance premium due PBGC	99	545	-	-
	$326	$928	$196	$219

Additional information

Pension expense was $522 for the year ended December 31, 2015, which included net periodic benefit expense of $227 for the pension, $196 for the SERP and $99 of insurance premiums due to the PBGC.  Pension expense was $1,147 for the year ended December 31, 2014, which included net periodic benefit expense of $383 for the pension, $219 for the SERP, $394 of insurance premiums due to the PBGC and $151 of federal excise tax related to non-payment of minimum pension funding requirements.

There was an unrecognized net actuarial loss of $15,710 in 2014 due to a decrease in the discount rate used to remeasure the Pension Plan of 4.8% as of December 31, 2013 compared to 3.8% as of December 31, 2014.  The discount rate is estimated based on an index of similar fixed income securities.

The SERP minimum liability recorded in other comprehensive loss increased $750 in 2015 compared to an increase of $307 in 2014.  The increase in 2015 reflected the decrease to the discount rate used to measure the SERP as of December 31, 2015 of 3.7% compared to 3.8% as of December 31, 2014 and the use of more current mortality tables.

Assumptions

The weighted average assumptions used to remeasure benefit obligations as of December 31, 2015 and 2014 included a discount rate of 3.8% and 4.8%, respectively, for the Pension Plan and SERP.  The weighted average assumptions used to determine net periodic cost for the periods ended December 31, 2015 and 2014 included a discount rate of 3.8% and 4.8%, respectively, in each period for the Pension Plan and SERP. The weighted average assumption used to determine an expected long-term rate of return on Pension Plan assets was 8.0%.

The long-term rate of return on plan assets was estimated as the weighted average expected return of each of the asset classes in the target allocation of plan assets.  The expected return of each asset class is based on historical market returns.

Pension Plan Assets

The Pension Plan's weighted-average asset allocations and weighted-average targeted asset allocations for each of the years presented were as follows:

		2015	2014
Asset allocation category of plan assets	Target %	Actual %	Actual %
Mutual funds - equity securities	60	n/a	61
Mutual funds - debt securities	25	n/a	39
Real estate investment trust	5	n/a	-
Hedge funds	10	n/a	-

The asset allocation policy, consistent with the long-term growth objectives of the Pension Plan, was to invest on a diversified basis among various asset classes as determined by the Pension Plan Administrative Committee.  Assets were invested in a manner intended to provide for long-term growth with a goal to achieve returns equal to or greater than applicable benchmarks.  Investments were managed by registered investment advisors.

No securities of the Company were part of the Pension Plan assets at any time.

Fair Value Measurements

The Pension Plan assets included a significant amount of mutual funds invested in equity and debt securities that were classified within Level 1 because the underlying investments had readily available market prices. Fair values of real estate investments within the real estate investment trust were classified as Level 3 because they were valued using real estate valuation techniques and other methods that include reference to third-party sources and sales comparables where available.  Hedge fund investments were classified in Level 2 and the fair values were generally calculated from pricing models with market input parameters from third-party sources.  The Pension Plan assets fair value measurements are summarized below:

Description	December 31, 2014	Level 1	Level 2	Level 3
Pension Plan Assets:
Mutual funds - equity securities	$18,227	$18,227	$-	$-
Mutual funds - debt securities	11,449	11,449	-	-
Money market mutual funds	45	45	-	-
Total	$29,721	$29,721	$-	$-

Cash Flows

Employer contributions

Through September 15, 2012, the Company's funding policy was to contribute to the Pension Plan trust amounts sufficient to satisfy regulatory funding standards, based upon independent actuarial valuations. Beginning in October 2012, the Company discontinued this policy in order to preserve the necessary liquidity for its operations. As a result, a statutory lien in favor of the PBGC was placed against the assets of the Company to secure aggregate unpaid contributions which amounted to $6,979, including interest, as of January 15, 2015, which is the date the most recent contribution was due. However, under the Pension Settlement Agreement all of the Pension Plan's liabilities, including the unpaid contributions were settled for an amount substantially less than the total and the PBGC statutory lien was withdrawn in favor of new consensual liens which are subordinate to the Company's senior lenders (see Settlement of Pension Plan Liabilities above).

The Company is not currently required to fund the SERP.  All benefit payments are made by E&S directly to those who receive benefits from the SERP.  As such, these payments are treated as both contributions and benefits paid for reporting purposes.

The Company expects to contribute and pay benefits of approximately $480 related to the SERP in 2016.

Estimated future benefit payments

As of December 31, 2015, the following benefits are expected to be paid based on actuarial estimates and prior experience:

Years Ending
December 31,	SERP
2016	$480
2017	516
2018	507
2019	449
2020	441
2021-2025	2,195

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Note 6 - Debt

12 Months Ended

Dec. 31, 2015

Notes

Note 6 - Debt

Note 6 – Debt

Long-term debt consisted of the following as of December 31, 2015 and 2014:

	2015	2014
First mortgage note payable due in monthly installments of $23 (interest at 5.75%) through January 1, 2024; payment and rate subject to adjustment every 3 years, next adjustment January 14, 2019	$1,789	$1,957
Second mortgage note payable due in monthly installments of $4 (interest at 5.75%) through October 1, 2028; payment and rate subject to adjustment every 5 years, next adjustment October 1, 2018	385	405
Total debt	2,174	2,362
Current portion of long-term debt	(199)	(2,362)
Long-term debt, net of current portion	$1,975	$-

Principal maturities on total debt are as follows:

Years Ending
December 31,
2016	$199
2017	211
2018	224
2019	237
2020	251
Thereafter	1,052
Total debt	2,174

Mortgage Notes

The first mortgage note payable represents the balance on a $3,200 note ("First Mortgage Note") issued on January 14, 2004 by Spitz. The First Mortgage Note requires repayment in monthly installments of principal and interest over 20 years.  On each third anniversary of the First Mortgage Note, the interest rate is adjusted to the greater of 5.75% or 3% over the Three-Year Constant Maturity Treasury Rate published by the United States Federal Reserve ("3YCMT").  The monthly installment is recalculated on the first month following a change in the interest rate. The recalculated monthly installment is equal to the monthly installment sufficient to repay the principal balance, as of the date of the change in the interest rate, over the remaining portion of the original 20-year term.  On January 14, 2016, the 3YCMT was 1.14% and the interest rate on the First Mortgage Note remained at 5.75% per annum. As a result, the monthly installment amount remained at $23.

The second mortgage note payable represents the balance on a $500 note ("Second Mortgage Note") issued on September 11, 2008 by Spitz. The Second Mortgage Note requires repayment in monthly installments of principal and interest over 20 years.  On each fifth anniversary of the Second Mortgage Note, the interest rate is adjusted to the greater of 5.75% or 3% over 3YCMT.  The monthly installment is recalculated on the first month following a change in the interest rate. The recalculated monthly installment is equal to the monthly installment sufficient to repay the principal balance, as of the date of the change in the interest rate, over the remaining portion of the original 20-year term.  On September 11, 2013, the fifth anniversary of the Second Mortgage Note, the 3YCMT was 0.88%. As a result, interest continues at 5.75% until possible adjustment on the next 5-year anniversary. The monthly installment also remains unchanged at $4.

The Mortgage Notes are secured by the real property occupied by Spitz pursuant to a Mortgage and Security Agreement.  The real property had a carrying value of $4,301 as of December 31, 2015. The Mortgage Notes are guaranteed by E&S.

On October 3, 2014, the holder of the mortgage notes, a commercial bank, notified the Company that the statutory liens placed on the Company's assets by the Pension Plan constituted an event of default under the mortgage note agreements. The commercial bank agreed to forbear from exercising any further remedies, other than suspension of advances under the working capital line of credit, until August 31, 2015 by which time the process of withdrawing the statutory Pension Plan liens was completed in accordance with terms of the Pension Settlement Agreement (see Note 5) curing the default.  The agreement to forbear from exercising any further remedies was subject to the Company continuing to make debt service payments under the mortgage note agreements, the occurrence of no further adverse events in the condition of the Company and the Company's agreement to the incorporation of the financial covenants in the line of credit agreement as additional covenants in the mortgage note agreements effective immediately and continuing until the mortgage notes are paid in full. One of the covenants requires Spitz to maintain tangible net worth of at least $6,000 measured upon issuance of quarterly and annual financial statements. As of the end of the second and third quarter of 2014, Spitz's tangible net worth measured $5,914 and $5,801, respectively. As of December 31, 2014, Spitz's tangible net worth measured $5,744.  The commercial bank granted a waiver of the event of default for the failure to maintain Spitz's tangible net worth of at least $6,000 as of the end of the second and third quarters of 2014 and as of December 31, 2014. At the end of each fiscal quarter of 2015 Spitz tangible net worth exceeded the $6,000 covenant compliance threshold.  The Company believes that it will be in compliance with the additional covenants in future periods.

Line of Credit

The Company is a party to a line-of-credit agreement with a commercial bank which permits borrowings of up to $1,100 to fund Spitz working capital requirements. Under the line of credit agreement, interest is charged on amounts borrowed at the lender's prime rate less 0.25%.  Any borrowings under the Credit Agreement are secured by Spitz real and personal property and all of the outstanding shares of Spitz common stock. The line-of-credit agreement and mortgage notes (with the same commercial bank) contain cross default provisions whereby a default on either agreement will result in a default on both agreements. On October 3, 2014, the commercial bank notified the Company that it was no longer obligated to make advances under the line-of-credit agreement and elected to suspend future advances because of events of default on loan covenants resulting from the statutory liens placed on the Company's assets by the Pension Plan. In September 2015, the bank confirmed that the defaults were cured as a result of the settlement of the pension liabilities. There were no borrowings outstanding under the line-of-credit agreement as of December 31, 2015.

Sale/Leaseback Financing

In November 2009, the Company completed a purchase agreement with a buyer, Wasatch Research Park I, LLC ("Wasatch") to sell its corporate office buildings and its interest in the lease for the land occupied by the buildings in Utah for $2,500.  Under the agreement, E&S transferred legal title of the buildings including improvements and assigned the related land lease to Wasatch. E&S also entered into a sublease agreement to lease back the land and building for rent of $501 per year, of which $126 represents the land lease and $375 represents the building lease.   The sublease agreement had a term of 5 years with an option for two subsequent 5-year renewal periods.  The agreement provided the Company with a 5-year option to repurchase all of the buildings under lease or only one of the buildings known as the Substation along with the lease interest in the land. In 2011, Rocky Mountain Power ("RMP"), a public utility company, obtained a decree of condemnation of the Substation so that RMP may repurpose the Substation for public use. As such, the Company no longer had the option to buy the Substation.

The arrangement was accounted for as a financing and no sale was recorded because the Company had the right to repurchase the property.  Therefore, the assets representing the building and improvements remained in property and equipment and the Company recorded the net proceeds of the sale as long-term debt. The $126 portion of the sublease payment attributable to the land lease was equivalent to the payment under the assigned land lease and therefore was subject to the same rent escalations the Company was bound to before the assignment. The land lease portion of the sublease payment was recorded as rent expense consistent with the treatment of the prior land lease payment before the assignment of the lease. The $375 portion of the sublease agreement attributable to the building lease was accounted for as debt service under the financing transaction.  The net proceeds of the financing amounted to $2,329 consisting of the $2,500 sales price less a security deposit of $125, prorated building rent of $15 and the first monthly payment of $31. E&S recorded interest expense at a rate of approximately 20% imputed from the estimated cash flows assuming it would exercise the option to repurchase the property at the end of the 5-year term.

The repurchase transaction was required to have been completed by October 31, 2014. On November 4, 2014, the Company agreed to an extension of its current lease for a term of 5 years. As a condition of the extension, the Company no longer has a right to repurchase the buildings. Base annual rent for the extended 5-year term is $549.

The extension of the lease for 5 years without a repurchase option resulted in a new operating lease and the extinguishment of the lease debt obligation in the amount of $3,152 along with the disposal of building assets amounting to $2,532. As a result, there was a gain on the disposal of the building assets in the amount of $620 which was deferred under sale leaseback accounting rules (see Note 4).

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Note 7 - Income Taxes

12 Months Ended

Dec. 31, 2015

Notes

Note 7 - Income Taxes

Note 7 - Income Taxes

The Company recognizes the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the more-likely-than-not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority.  The Company is subject to audit by the IRS and various states for tax years dating back to 2011.  The Company recognizes interest and penalties, if any, related to unrecognized tax benefits in income tax expense.

Income tax for 2015 and 2014 consisted of a benefit of $12 and expense of $23, respectively, of federal and state income taxes. The actual expense differs from the expected tax benefit (provision) as computed by applying the U.S. federal statutory income tax rate of 34 percent for 2015 and 2014, as follows:

	2015	2014
Income tax benefit at U.S. federal statutory rate	$440	$436
State tax benefit (provision) (net of federal income tax benefit)	(14)	42
Change in valuation allowance attributable to operations	4,146	(332)
Change in effective tax rate	(4,064)	-
Pension settlement	(466)	-
Other, net	(31)	(169)
Income tax benefit (provision)	$12	$(23)

The tax effects of temporary differences that give rise to significant portions of the deferred income tax assets and liabilities as of December 31, 2015 and 2014 are as follows:

	2015	2014
Property and equipment, principally due to differences in depreciation	$(722)	$845
Inventory reserves and other inventory-related temporary basis differences	696	663
Warranty, vacation, deferred rent and other liabilities	883	1,114
Retirement liabilities	1,088	2,427
Net operating loss carryforwards	62,194	63,511
Credit carryforwards	817	825
Other	1,227	944
Total deferred income tax assets	66,183	70,329
Less valuation allowance	(66,183)	(70,329)
Net deferred income tax assets	$-	$-

Worldwide income (loss) before income taxes consisted of the following:

	2015	2014
United States	$(1,296)	$(1,282)
International	-	-
Total	$(1,296)	$(1,282)

Income tax benefit (provision) consisted of the following:

	2015	2014
Current
U.S. federal	$-	$-
State	12	(23)
Total	$12	$(23)
Deferred
U.S. federal	$(4,068)	$985
State	(78)	(653)
Total	(4,146)	332
Valuation allowance (increase) decrease	4,146	(332)
Total	$-	$-

E&S has total federal net operating loss carryforwards of approximately $168,400 which expire from 2018 through 2033.  No federal net operating loss carryforwards expired in 2015 or 2014.  The Company has various federal tax credit carryforwards of approximately $800, a portion of which expire between 2015 and 2016.  E&S also has state net operating loss carryforwards of approximately $149,700 that expire at various dates depending on the rules of the states to which the loss or credit is allocated.

During the years ended December 31, 2015 and 2014, the valuation allowance on deferred income tax assets decreased by $4,146 and increased by $332, respectively.  Valuation allowances were established according to the belief that it is more likely than not that these net deferred income tax assets will not be realized.

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Note 8 - Commitments and Contingencies

12 Months Ended

Dec. 31, 2015

Notes

Note 8 - Commitments and Contingencies

Note 8 - Commitments and Contingencies

Letters of Credit

Under the terms of financing arrangements for letters of credit, E&S is required to maintain a balance in a specific cash account equal to or greater than the outstanding value of all letters of credit or bank guarantees issued, plus other amounts necessary to adequately secure obligations with the financial institution.  As of December 31, 2015, there were outstanding letters of credit and bank guarantees of $600, which are scheduled to expire in 2016.  There was no restricted cash included in other assets as of December 31, 2015 or 2014.

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Note 9 - Stock Option Plan

12 Months Ended

Dec. 31, 2015

Notes

Note 9 - Stock Option Plan

Note 9 - Stock Option Plan

In 2014, stockholders approved the adoption of the Evans & Sutherland Computer Corporation 2014 Stock Incentive Plan ("2014 Plan") which replaced the expired 2004 Stock Incentive Plan of Evans & Sutherland Computer Corporation ("2004 Plan").  The 2014 Plan is a stock incentive plan that provides for the grant of options and restricted stock awards to employees and for the grant of options to non-employee directors essentially the same as the 2004 Plan.  Under the 2014 Plan, non-employee directors may continue to receive an annual option grant for no more than 10,000 shares.  New non-employee directors may also continue to receive an option grant for no more than 10,000 shares upon their appointment or election.  With the adoption of the 2014 Plan, no additional options can be issued under the 2004 Plan.  Options granted under the 2004 Plan are still held by recipients and will continue to be subject to the terms and conditions of the 2004 plan which are essentially the same as the 2014 Plan. The 2014 Plan continues a minimum exercise price for options of 110% of fair market value on the date of grant.

Restricted stock awards may be qualified as a performance-based award that conditions a participant's award upon achievement by the Company or its subsidiaries of performance goals established by the Board of Directors' Compensation Committee.

The number of shares, terms, and exercise periods of option grants are determined by the Board of Directors on an option-by-option basis. Options generally vest ratably over three years and expire ten years from the date of grant.  As of December 31, 2015, options to purchase 1,303,713 shares of common stock were authorized and reserved for future grant.

A summary of activity follows (shares in thousands):

	2015		2014
		Weighted-		Weighted-
		Average		Average
	Number	Exercise	Number	Exercise
	of Shares	Price	of Shares	Price
Outstanding as of beginning of the period	1,333	$2.08	1,235	$2.62
Granted	221	0.39	200	0.13
Exercised	-	-	-	-
Forfeited or expired	(84)	7.23	(102)	4.85
Outstanding as of end of the period	1,470	1.53	1,333	2.08
Exercisable as of end of the period	1,065	2.01	996	2.74

The weighted average fair value of options granted during 2015 and 2014 was $0.39 and $0.13, respectively.  As of December 31, 2015, options exercisable and options outstanding had a weighted average remaining contractual term of 3.4 and 4.8 years, respectively, and no aggregate intrinsic value. As of December 31, 2014, options exercisable and options outstanding had a weighted average remaining contractual term of 3.4 and 4.7 years, respectively, and no aggregate intrinsic value.

The fair value of each option grant is estimated on the date of the grant using the Black-Scholes option-pricing model with the following weighted-average assumptions used for the grants made in 2015 and 2014:

	2015	2014
Expected life (in years)	3.5	3.5
Risk free interest rate	0.91%	0.74%
Expected volatility	340%	340%
Dividend yield	-	-

Expected option lives and volatilities are based on historical data of the Company.  The risk free interest rate is calculated as the average US Treasury bill rate that corresponds with the option life.  Historically, the Company has not declared dividends and there are no plans to do so.

As of December 31, 2015, there was approximately $35 of total unrecognized share-based compensation cost related to grants under the plan that will be recognized over a weighted-average period of 1.9 years.  As of December 31, 2014, there was approximately $10 of total unrecognized share-based compensation cost related to grants under the plan that will be recognized over a weighted-average period of 1.9 years.

Share-based compensation expense, from awards under the 2004 Plan for the years ended December 31, 2015 and 2014 amounted to $41 and $16, respectively, and was recorded as general and administrative expense.

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Note 10 - Preferred Stock

12 Months Ended

Dec. 31, 2015

Notes

Note 10 - Preferred Stock

Note 10 - Preferred Stock

Class A Preferred Stock

The Company has 5,000,000 authorized shares of Class A Preferred stock.  As of December 31, 2015 and 2014, there were no Class A Preferred shares outstanding.

Class B Preferred Stock

The Company has 5,000,000 authorized shares of Class B Preferred stock.  As of December 31, 2015 and 2014, there were no Class B Preferred shares outstanding.

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Note 11 - Geographic Information

12 Months Ended

Dec. 31, 2015

Notes

Note 11 - Geographic Information

Note 11 - Geographic Information

The table below presents sales by geographic location:

	2015	2014
United States	$16,809	$11,639
International	18,489	14,827
Total sales	$35,298	$26,466

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Note 12 - Significant Customers

12 Months Ended

Dec. 31, 2015

Notes

Note 12 - Significant Customers

Note 12 - Significant Customers

As of December 31, 2015, Customers A, B, C and D represented 14%, 14%, 13% and 13% of accounts receivable, respectively, and Customers E and F represented 41% and 12% of costs and estimated earnings in excess of billings, respectively.

As of December 31, 2014, Customers E and G represented 23% and 12% of accounts receivable, respectively, and Customers E and H represented 37% and 15% of costs and estimated earnings in excess of billings, respectively.

For the years ended December 31, 2015 and 2014, no individual customer represented 10% or more of total sales.

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Note 1 - Nature of Operations and Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2015

Policies

Basis of Presentation

Basis of Presentation

The consolidated financial statements include the accounts of Evans & Sutherland and its wholly owned subsidiaries.  All inter-company accounts and transactions have been eliminated in consolidation.

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes.  The accounting estimates that require management's most difficult and subjective judgments include revenue recognition based on the percentage-of-completion method, inventory reserves, allowance for doubtful accounts receivable, allowance for deferred income tax assets, impairment of long-lived assets, pension and retirement obligations and useful lives of depreciable assets.  Actual results could differ from those estimates.

Cash and Cash Equivalents

Cash and Cash Equivalents

The Company considers all highly liquid investments with original maturities of three or fewer months to be cash equivalents.  The Company maintains cash balances in bank accounts that, at times, exceed federally insured limits.  The Company has not experienced any losses in these accounts and believes it is not exposed to any significant risk with respect to cash.  As of December 31, 2015, cash deposits as reported by the banks, including restricted cash, exceeded the federally insured limits by approximately $4,022.

Restricted Cash

Restricted Cash

Restricted cash that guarantees letters of credit that mature or expire within one year is reported as a current asset.  Restricted cash that guarantees letters of credit that mature or expire after more than one year is reported as a long-term asset.  There was no restricted cash included in other assets as of December 31, 2015 and 2014.

Trade Accounts Receivable

Trade Accounts Receivable

In the normal course of business, E&S provides unsecured credit terms to its customers.  Accordingly, the Company maintains an allowance for doubtful accounts for possible losses on uncollectible accounts receivable.  The Company routinely analyzes accounts receivable and costs and estimated earnings in excess of billings, and considers history, customer creditworthiness, facts and circumstances specific to outstanding balances, current economic trends, and changes in payment terms when evaluating the adequacy of the allowance for doubtful accounts receivable.  Changes in these factors could result in material differences to bad debt expense.  Past due balances are determined based on contractual terms and are reviewed individually for collectability. Uncollectible accounts receivable are charged against the allowance for doubtful accounts when management determines the probability of collection is remote.

The table below represents changes in E&S's allowance for doubtful accounts receivable for the years ended December 31:

	2015	2014
Beginning balance	$217	$277
Write-off of accounts receivable	(64)	(47)
Increase (decrease) in estimated losses on accounts receivable	133	(13)
Ending balance	$286	$217

Inventories

Inventories

Inventories include materials at standard costs, which approximate actual costs, as well as inventoried costs on programs and long-term contracts.  Inventoried costs include material, direct engineering and production costs, and applicable overhead, not in excess of estimated realizable value.  Spare parts and general stock materials are stated at cost not in excess of realizable value.  E&S periodically reviews inventories for excess supply, obsolescence, and valuations above estimated realizable amounts, and provides a reserve sufficient to reduce inventories to net realizable values.  Revisions of these estimates could impact net loss.

During the years ended December 31, 2015 and 2014, E&S recognized impairment losses on inventory of $155 and $197, respectively.

Inventories as of December 31, were as follows:

	2015	2014
Raw materials	$5,958	$5,468
Work in process	1,265	1,678
Finished goods	220	233
Reserve for obsolete inventory	(3,371)	(3,216)
Inventories, net	$4,072	$4,163

Property and Equipment

Property and Equipment

Property and equipment are stated at cost.  Depreciation and amortization are computed using the straight-line method based on the estimated useful lives of the related assets.  Expenditures that materially increase values or capacities or extend useful lives of property and equipment are capitalized.  Leasehold improvements are assigned useful lives based on the shorter of their useful lives or the term of the related leases, including renewal options likely to be exercised.  Routine maintenance, repairs and renewal costs are expensed as incurred.  When property is retired or otherwise disposed of, the carrying values are removed from the property and equipment and related accumulated depreciation and amortization accounts.  Depreciation and amortization are included in cost of sales, research and development or selling, general and administrative expenses depending on the nature of the asset.

Depreciation expense was $250 and $418 for the years ended December 31, 2015 and 2014, respectively.  The cost and estimated useful lives of property and equipment and the total accumulated depreciation and amortization were as follows as of December 31:

	Estimated
	Useful Lives	2015	2014
Land	n/a	$2,250	$2,250
Buildings and improvements	5 - 40 years	3,028	3,028
Manufacturing machinery and equipment	3 - 8 years	5,301	5,183
Office furniture and equipment	3 - 8 years	779	779
Total		11,358	11,240
Less accumulated depreciation and amortization		(6,623)	(6,437)
Net property and equipment		$4,735	$4,803

Goodwill and Intangible Assets

Goodwill

The Company tests its recorded goodwill for impairment on an annual basis during the fourth quarter, or more often if indicators of potential impairment exist, by determining if the carrying value of each reporting unit exceeds its estimated fair value. Factors that could trigger impairment include, but are not limited to, underperformance relative to historical or projected future operating results, significant changes in the manner of use of the acquired assets or the Company's overall business and significant negative industry or economic trends. Future impairment reviews may require write-downs in the Company's goodwill and could have a material adverse impact on the Company's operating results for the periods in which such write-downs occur.

Intangible Assets

E&S amortizes the cost of intangible assets over their estimated useful lives. Amortizable intangible assets are reviewed at least annually to determine whether events and circumstances warrant a revision to the remaining period of amortization.  Amortization expense was $41 and $47 for the years ended December 31, 2015 and 2014, respectively.

Software Development Costs

Software Development Costs

Software development costs, if material, are capitalized from the date technological feasibility is achieved until the product is available for general release to customers.  Such costs were not material for the years presented.

Impairment of Long-lived Assets

Impairment of Long-Lived Assets

Long-lived assets are reviewed for impairment when events or changes in circumstances indicate the carrying values of the assets may not be fully recoverable. When this occurs, the Company reviews the values assigned to long-lived assets by analyzing the anticipated, undiscounted cash flows they generate.  When the expected future undiscounted cash flows from these assets do not exceed their carrying values, the Company estimates the fair values of such assets. Impairment is recognized to the extent the carrying values of the assets exceed their estimated fair values.  Assets held for sale are reported at the lower of their carrying values or fair values less costs to sell.

Warranty Reserve

Warranty Reserve

E&S provides a warranty reserve for estimated future costs of servicing products under warranty agreements extending for periods from 90 days to one year.  Anticipated costs for product warranties are based upon estimates derived from experience factors and are recorded at the time of sale or over the period revenues are recognized for long-term contracts.  Warranty reserves are classified as accrued liabilities in the accompanying consolidated balance sheets.

The table below represents changes in E&S's warranty reserve for the years ended December 31:

	2015	2014
Beginning balance	$125	$150
Additions to warranty reserve	149	98
Warranty costs	(147)	(123)
Ending balance	$127	$125

Revenue Recognition

Revenue Recognition

Sales include revenues from system hardware, software, database products and service contracts.  The following table provides information on revenues by recognition method applied during the years:

	2015	2014
Percentage of completion	$19,827	$14,085
Completed contract	13,653	10,670
Other	1,818	1,711
Total sales	$35,298	$26,466

The following methods are used to record revenue:

Percentage of Completion. In arrangements that are longer in term and require significant production, modification or customization, revenue is recognized using the percentage-of-completion method.  In applying this method,  the Company utilizes the cost-to-cost methodology whereby it estimates the percent complete by calculating the ratio of costs incurred (consisting of material, labor and subcontracting costs, as well as an allocation of indirect costs) to its estimate of total anticipated costs.   This ratio is then utilized to determine the amount of gross profit earned based on its estimate of total gross profit at completion.  The Company routinely reviews estimates related to percentage-of-completion contracts and adjusts for changes in the period the revisions are made.  Billings on uncompleted percentage-of-completion contracts may be greater than or less than incurred costs and estimated earnings, and are recorded as an asset or liability in the accompanying consolidated balance sheets.

Completed Contract. Contract arrangements which typically require a relatively short period of time to complete the production, modification, and customization of products are accounted for using the completed contract method.  Accordingly, revenue is recognized upon delivery of the completed product, provided persuasive evidence of an arrangement exists, title and risk of loss have transferred, the fee is fixed or determinable, and collection is reasonably assured.

Multiple Element Arrangements.  Some contracts include multiple elements.  Significant deliverables in such arrangements commonly include various hardware components of visual display systems, domes, show content and various service and maintenance elements.  Revenue earned on elements such as products, services and maintenance contracts are allocated to each element based on the relative fair values of the elements.  Relative fair values of elements are generally determined based on actual and estimated selling price.  Delivery times of such contracts typically occur within a three to six-month time period.

Other.  Other revenue consists primarily of amounts earned under maintenance contracts that are generally sold as a single element to customers.  Revenue from product maintenance contracts, including separately priced extended warranty contracts, is deferred and recognized over the period of performance under the contract.

Anticipated Losses.  For contracts with anticipated losses at completion, a provision is recorded when the loss is probable.  After an anticipated loss is recorded, subsequent revenue and cost of sales are recognized in equal, offsetting amounts as contract costs are incurred.

Net Loss Per Common Share

Net Loss per Common Share

Net loss per common share is computed based on the weighted-average number of common shares and, as appropriate, dilutive common stock equivalents outstanding during the year.  Stock options are common stock equivalents.

Basic loss per common share is based upon the average number of shares of common stock outstanding during the year. Potentially dilutive securities from stock options are discussed in Note 9.

Income Taxes

Income Taxes

The Company uses the asset and liability method of accounting for income taxes.  Under the asset and liability method, deferred income tax assets and liabilities are recognized for the future income tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective income tax bases and operating loss and income tax credit carry-forwards.  Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred income tax assets and liabilities of a change in income tax rates is recognized in the period that includes the enactment date.

Other Comprehensive Loss

Other Comprehensive Loss

On a net basis for 2015 and 2014, there were deferred income tax assets resulting from items reflected in comprehensive loss.  However, E&S has determined that it is more likely than not that it will not realize such net deferred income tax assets and has therefore established a valuation allowance against the full amount of the net deferred income tax assets.  Accordingly, the net income tax effect of the items included in other comprehensive income (loss) is zero.  Therefore, the Company has included no income tax expense or benefit in relation to items reflected in other comprehensive income (loss).

The components of accumulated other comprehensive loss were as follows as of December 31:

	2015	2014
Additional minimum pension liability	$(2,404)	$(33,625)
Total accumulated other comprehensive loss	$(2,404)	$(33,625)

Leases

Leases

The Company recognizes scheduled rent increases on a straight-line basis over the lease term, which may include optional lease renewal terms. Deferred rent income and expense are recognized to reflect the difference between the rent paid or received in the current period and the calculated straight-line amount.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In November 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update No. 2015-17, Income Taxes (Topic 740) ("ASU 2015-17").  ASU 2015-17 requires that all deferred income tax assets and liabilities be classified as non-current.  ASU 2015-17 is not effective until the 2017 fiscal year.  The Company is currently assessing the impact, if any, on its financial reporting of implementing this guidance.

In April 2015, the FASB issued ASU No. 2015-03, Interest – Imputation of Interest (Subtopic 835-30), Simplifying the Presentation of Debt Issuance Costs ("ASU 2015-03").  To simplify presentation of debt issuance costs, the amendments in ASU 2015-03 require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts.  The recognition and measurement guidance for debt issuance costs are not affected by the amendments in ASU 2015-03.  For public companies, ASU 2015-03 is effective for financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years.  Early adoption is permitted for financial statements that have not been previously issued.  The Company is currently assessing the impact, if any, on its financial reporting of implementing this guidance.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers ("ASU 2014-09"). ASU 2014-09 provides for a single, principles-based model for revenue recognition that replaces existing revenue

recognition guidance. ASU 2014-09 is effective for annual and interim periods beginning on or after December 15, 2016. It permits the use of either a retrospective or cumulative effect transition method and early adoption is not permitted. The Company has not yet selected a transition method and is in the process of evaluating the effect ASU 2014-09 will have on its consolidated financial statements and related disclosures.  During 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers: Deferral of the Effective Date ("ASU 2015-14"), which deferred the date of ASU 2014-09 by one year.

In August 2014, the FASB issued ASU No. 2014-15, Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern ("ASU 2014-15"). This standard sets forth management's responsibility to evaluate, each reporting period, whether there is substantial doubt about the entity's ability to continue as a going concern, and if so, to provide related note disclosures. ASU 2014-15 is effective for annual reporting periods beginning after December 15, 2016, and interim periods within annual periods ending after December 15, 2016. The Company is currently assessing the impact, if any, on its financial reporting of implementing this guidance.

Liquidity

Liquidity

The Company has experienced recurring annual losses since 2007, except for 2013. On April 21, 2015, the Company executed an agreement (the "Pension Settlement Agreement") which terminated its defined benefit pension plan (the "Pension Plan") and settled the Pension Plan's liabilities in exchange for an obligation to pay to the Pension Benefit Guaranty Corporation ("PBGC") $10,500 over twelve years and issue to the PBGC 88,117 shares of E&S treasury stock (see Note 5). In addition, the Pension Settlement Agreement has led to a new banking relationship and improved credit capacity. Aided by prior cost reduction efforts and improved sales volume, for the year ended December 31, 2015, the Company has generated profitable results before recording the pension expense and a charge for the settlement of the Pension Plan. The Company is no longer incurring expenses related to the terminated Pension Plan but as of December 31, 2015 is responsible for eleven annual installment payments of $750 to the PBGC. Management believes that the Company's unrestricted cash balances totaling $3,734 as of December 31, 2015 and improved credit capacity and forecasted operations provide sufficient resources to meet the Company's obligations, including the terms of the Pension Settlement Agreement, through at least the end of 2016.

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Note 1 - Nature of Operations and Summary of Significant Accounting Policies: Trade Accounts Receivable: Schedule of Doubtful Accounts (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Doubtful Accounts

	2015	2014
Beginning balance	$217	$277
Write-off of accounts receivable	(64)	(47)
Increase (decrease) in estimated losses on accounts receivable	133	(13)
Ending balance	$286	$217

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Note 1 - Nature of Operations and Summary of Significant Accounting Policies: Inventories: Schedule of Inventory (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Inventory

	2015	2014
Raw materials	$5,958	$5,468
Work in process	1,265	1,678
Finished goods	220	233
Reserve for obsolete inventory	(3,371)	(3,216)
Inventories, net	$4,072	$4,163

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Note 1 - Nature of Operations and Summary of Significant Accounting Policies: Property and Equipment: Schedule of Depreciation (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Depreciation

	Estimated
	Useful Lives	2015	2014
Land	n/a	$2,250	$2,250
Buildings and improvements	5 - 40 years	3,028	3,028
Manufacturing machinery and equipment	3 - 8 years	5,301	5,183
Office furniture and equipment	3 - 8 years	779	779
Total		11,358	11,240
Less accumulated depreciation and amortization		(6,623)	(6,437)
Net property and equipment		$4,735	$4,803

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Note 1 - Nature of Operations and Summary of Significant Accounting Policies: Warranty Reserve: Schedule of Product Warranty Reserve (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Product Warranty Reserve

	2015	2014
Beginning balance	$125	$150
Additions to warranty reserve	149	98
Warranty costs	(147)	(123)
Ending balance	$127	$125

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Note 1 - Nature of Operations and Summary of Significant Accounting Policies: Revenue Recognition: Schedule of Revenues by Recognition Method Applied (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Revenues by Recognition Method Applied

	2015	2014
Percentage of completion	$19,827	$14,085
Completed contract	13,653	10,670
Other	1,818	1,711
Total sales	$35,298	$26,466

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Note 1 - Nature of Operations and Summary of Significant Accounting Policies: Other Comprehensive Loss: Schedule of Comprehensive Income (Loss) (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Comprehensive Income (Loss)

	2015	2014
Additional minimum pension liability	$(2,404)	$(33,625)
Total accumulated other comprehensive loss	$(2,404)	$(33,625)

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Note 2 - Definite-lived Intangible Assets and Goodwill: Schedule of Intangible Assets and Goodwill (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Intangible Assets and Goodwill

		December 31,
		2015		2014
	Weighted Avg. Amortization Period in Years	Gross Carrying Amount	Accumulated Amortization	Gross Carrying Amount	Accumulated Amortization
Class
Maintenance and legacy customers	10	$350	$(335)	$350	$(308)
Planetarium shows	10	280	(268)	280	(254)
Total		$630	$(603)	$630	$(562)

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Note 3 - Costs and Estimated Earnings On Uncompleted Contracts: Schedule of Costs and Estimated Earnings on Uncompleted Contracts (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Costs and Estimated Earnings on Uncompleted Contracts

	2015	2014
Total accumulated costs and estimated earnings on uncompleted contracts	$33,445	$29,629
Less total billings on uncompleted contracts	(34,745)	(33,106)
Ending balance	$(1,300)	$(3,477)

The above amounts are reported in the consolidated balance sheets as of December 31 as follows:

	2015	2014
Costs and estimated earnings in excess of billings on uncompleted contracts	$2,695	$1,699
Billings in excess of costs and estimated earnings on uncompleted contracts	(3,995)	(5,176)
Ending balance	$(1,300)	$(3,477)

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Note 4 - Leases and Gain On Disposal of Building Assets: Schedule of Future Minimum Rental Payments for Operating Leases (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Future Minimum Rental Payments for Operating Leases

Years Ending December 31,	Rent Expense	Gain on Building	Deferred Rent Credit	Net Rent  Expense
2016	$549	$(124)	$(305)	$120
2017	549	(124)	(305)	120
2018	565	(124)	(305)	136
2019	475	(106)	(260)	109
Total	$2,138	$(478)	$(1,175)	$485

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Note 5 - Employee Retirement Benefit Plans: Schedule of Settlement of Pension Plan Liabilities (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Settlement of Pension Plan Liabilities

Unfunded Pension Plan Liability	$35,870
Market value of common shares issued from treasury	(70)
Pension Settlement Obligation	(7,644)
Total consideration to PBGC	(7,714)
Total gain from settlement of Pension Plan Liabilities	$28,156
Gain recorded as:
Charge to statement of operations	$(3,620)
Other comprehensive Income	31,776
Contribution to total comprehensive income	$28,156

After applying the first $1,500 installment made on May 1, 2015, and the first annual installment on October 22, 2015, and recording imputed interest expense at 7%, the balance of the Pension Settlement Obligation is recorded with liabilities on the balance sheet as follows as of December 31, 2015:

Current portion of pension settlement obligation	$356
Pension settlement obligation, net of current portion	5,268
Total Pension Settlement Obligation	$5,624

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Note 5 - Employee Retirement Benefit Plans: Schedule of Costs of Retirement Plans, changes in benefit obligation (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Costs of Retirement Plans, changes in benefit obligation

	Pension Plan		SERP
	2015	2014	2015	2014
Changes in benefit obligation
Projected benefit obligation - beginning of year	$64,831	$48,091	$4,871	$4,846
Service cost	-	-	-	-
Interest cost	617	2,275	177	218
Actuarial loss	1,690	14,942	769	308
Benefits paid	(339)	(477)	(497)	(501)
Transfer of benefit obligation upon termination	(66,799)	-	-	-
Projected benefit obligation - end of year	$-	$64,831	$5,320	$4,871

	Pension Plan		SERP
Changes in plan assets	2015	2014	2015	2014
Fair value of plan assets - beginning of year	$29,721	$29,073	$-	$-
Actual return on plan assets	1,547	1,125	-	-
Contributions	-	-	497	501
Benefits paid	(339)	(477)	(497)	(501)
Transfer out upon termination	(30,929)	-	-	-
Fair value of plan assets - end of year	$-	$29,721	$-	$-

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Note 5 - Employee Retirement Benefit Plans: Schedule of Amounts Recognized in Other Comprehensive Income (Loss) (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Amounts Recognized in Other Comprehensive Income (Loss)

	Pension Plan		SERP
	2015	2014	2015	2014
Net amount recognized
Unfunded status	$-	$(35,111)	$(5,320)	$(4,871)
Accrued PBGC insurance premiums	-	(629)	-	-
Unrecognized net actuarial loss	-	31,971	2,415	1,713
Unrecognized prior service cost	-	-	(11)	(59)
Net amount recognized	$-	$(3,769)	$(2,916)	$(3,217)

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Note 5 - Employee Retirement Benefit Plans: Schedule of Amounts Recognized in Balance Sheet (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Amounts Recognized in Balance Sheet

	Pension Plan		SERP
	2015	2014	2015	2014
Accrued liability	$-	$(35,111)	$(5,320)	$(4,871)
Accrued PBGC insurance premiums	-	(629)	-	-
Accumulated other comprehensive loss	-	31,971	2,404	1,654
Net amount recognized	$-	$(3,769)	$(2,916)	$(3,217)

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Note 5 - Employee Retirement Benefit Plans: Schedule of Net Periodic Benefit Cost (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Net Periodic Benefit Cost

	Pension Plan		SERP
	2015	2014	2015	2014
Service cost	$-	$-	$-	$-
Interest cost	617	2,275	177	218
Expected return on assets	(585)	(2,298)	-	-
Amortization of actuarial loss	195	406	68	50
Amortization of prior year service cost	-	-	(49)	(49)
Net periodic benefit expense	227	383	196	219
Insurance premium due PBGC	99	545	-	-
	$326	$928	$196	$219

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Note 5 - Employee Retirement Benefit Plans: Schedule of Allocation of Plan Assets (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Allocation of Plan Assets

		2015	2014
Asset allocation category of plan assets	Target %	Actual %	Actual %
Mutual funds - equity securities	60	n/a	61
Mutual funds - debt securities	25	n/a	39
Real estate investment trust	5	n/a	-
Hedge funds	10	n/a	-

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Note 5 - Employee Retirement Benefit Plans: Schedule of Changes in Fair Value of Plan Assets (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Changes in Fair Value of Plan Assets

Description	December 31, 2014	Level 1	Level 2	Level 3
Pension Plan Assets:
Mutual funds - equity securities	$18,227	$18,227	$-	$-
Mutual funds - debt securities	11,449	11,449	-	-
Money market mutual funds	45	45	-	-
Total	$29,721	$29,721	$-	$-

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Note 5 - Employee Retirement Benefit Plans: Schedule of Expected Benefit Payments (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Expected Benefit Payments

Years Ending
December 31,	SERP
2016	$480
2017	516
2018	507
2019	449
2020	441
2021-2025	2,195

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Note 6 - Debt: Schedule of Long-term Debt (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Long-term Debt

	2015	2014
First mortgage note payable due in monthly installments of $23 (interest at 5.75%) through January 1, 2024; payment and rate subject to adjustment every 3 years, next adjustment January 14, 2019	$1,789	$1,957
Second mortgage note payable due in monthly installments of $4 (interest at 5.75%) through October 1, 2028; payment and rate subject to adjustment every 5 years, next adjustment October 1, 2018	385	405
Total debt	2,174	2,362
Current portion of long-term debt	(199)	(2,362)
Long-term debt, net of current portion	$1,975	$-

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Note 6 - Debt: Schedule of Principal maturities (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Principal maturities

Years Ending
December 31,
2016	$199
2017	211
2018	224
2019	237
2020	251
Thereafter	1,052
Total debt	2,174

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Note 7 - Income Taxes: Schedule of Effective Income Tax Rate Reconciliation (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Effective Income Tax Rate Reconciliation

	2015	2014
Income tax benefit at U.S. federal statutory rate	$440	$436
State tax benefit (provision) (net of federal income tax benefit)	(14)	42
Change in valuation allowance attributable to operations	4,146	(332)
Change in effective tax rate	(4,064)	-
Pension settlement	(466)	-
Other, net	(31)	(169)
Income tax benefit (provision)	$12	$(23)

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Note 7 - Income Taxes: Schedule of Deferred Tax Assets and Liabilities (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Deferred Tax Assets and Liabilities

	2015	2014
Property and equipment, principally due to differences in depreciation	$(722)	$845
Inventory reserves and other inventory-related temporary basis differences	696	663
Warranty, vacation, deferred rent and other liabilities	883	1,114
Retirement liabilities	1,088	2,427
Net operating loss carryforwards	62,194	63,511
Credit carryforwards	817	825
Other	1,227	944
Total deferred income tax assets	66,183	70,329
Less valuation allowance	(66,183)	(70,329)
Net deferred income tax assets	$-	$-

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Note 7 - Income Taxes: Schedule of Worldwide Income Before Income Taxes (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Worldwide Income Before Income Taxes

	2015	2014
United States	$(1,296)	$(1,282)
International	-	-
Total	$(1,296)	$(1,282)

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Note 7 - Income Taxes: Schedule of Components of Income Tax Expense (Benefit) (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Components of Income Tax Expense (Benefit)

	2015	2014
Current
U.S. federal	$-	$-
State	12	(23)
Total	$12	$(23)
Deferred
U.S. federal	$(4,068)	$985
State	(78)	(653)
Total	(4,146)	332
Valuation allowance (increase) decrease	4,146	(332)
Total	$-	$-

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Note 9 - Stock Option Plan: Schedule of Stock Option Plan Activity (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Stock Option Plan Activity

	2015		2014
		Weighted-		Weighted-
		Average		Average
	Number	Exercise	Number	Exercise
	of Shares	Price	of Shares	Price
Outstanding as of beginning of the period	1,333	$2.08	1,235	$2.62
Granted	221	0.39	200	0.13
Exercised	-	-	-	-
Forfeited or expired	(84)	7.23	(102)	4.85
Outstanding as of end of the period	1,470	1.53	1,333	2.08
Exercisable as of end of the period	1,065	2.01	996	2.74

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Note 9 - Stock Option Plan: Schedule of Stock Options Valuation Assumptions (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Stock Options Valuation Assumptions

	2015	2014
Expected life (in years)	3.5	3.5
Risk free interest rate	0.91%	0.74%
Expected volatility	340%	340%
Dividend yield	-	-

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Note 11 - Geographic Information: Schedule of Sales by Geographic Location (Tables)

12 Months Ended

Dec. 31, 2015

Tables/Schedules

Schedule of Sales by Geographic Location

	2015	2014
United States	$16,809	$11,639
International	18,489	14,827
Total sales	$35,298	$26,466

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Note 1 - Nature of Operations and Summary of Significant Accounting Policies: Cash and Cash Equivalents (Details) $ in Thousands	Dec. 31, 2015 USD ($)
Details
Cash, Uninsured Amount	$ 4,022

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Note 1 - Nature of Operations and Summary of Significant Accounting Policies: Trade Accounts Receivable: Schedule of Doubtful Accounts (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Details
Allowance for Doubtful Accounts Receivable, Beginning Balance	$ 217	$ 277
Write-off of accounts receivable	(64)	(47)
Increase (reduction) in estimated losses on accounts receivable	133	(13)
Allowance for Doubtful Accounts Receivable, Ending Balance	$ 286	$ 217

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Note 1 - Nature of Operations and Summary of Significant Accounting Policies: Inventories (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Details
Provision for excess and obsolete inventory	$ 155	$ 197

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Note 1 - Nature of Operations and Summary of Significant Accounting Policies: Inventories: Schedule of Inventory (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Details
Raw Materials	$ 5,958	$ 5,468
Work-in-process	1,265	1,678
Finished goods	220	233
Reserve for obsolete inventory	(3,371)	(3,216)
Total inventories, net	$ 4,072	$ 4,163

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Note 1 - Nature of Operations and Summary of Significant Accounting Policies: Property and Equipment (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Details
Depreciation	$ 250	$ 418

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Note 1 - Nature of Operations and Summary of Significant Accounting Policies: Property and Equipment: Schedule of Depreciation (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Property, Plant and Equipment, Gross	$ 11,358	$ 11,240
Less accumulated depreciation and amortization	(6,623)	(6,437)
Net property and equipment	4,735	4,803
Land
Property, Plant and Equipment, Gross	2,250	2,250
Building and Building Improvements
Property, Plant and Equipment, Gross	$ 3,028	3,028
Building and Building Improvements | Minimum
Property, Plant and Equipment, Useful Life	5 years
Building and Building Improvements | Maximum
Property, Plant and Equipment, Useful Life	40 years
Machinery and Equipment
Property, Plant and Equipment, Gross	$ 5,301	5,183
Machinery and Equipment | Minimum
Property, Plant and Equipment, Useful Life	3 years
Machinery and Equipment | Maximum
Property, Plant and Equipment, Useful Life	8 years
Office Equipment
Property, Plant and Equipment, Gross	$ 779	$ 779
Office Equipment | Minimum
Property, Plant and Equipment, Useful Life	3 years
Office Equipment | Maximum
Property, Plant and Equipment, Useful Life	8 years

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Note 1 - Nature of Operations and Summary of Significant Accounting Policies: Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Details
Amortization expense	$ 41	$ 47

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Note 1 - Nature of Operations and Summary of Significant Accounting Policies: Warranty Reserve: Schedule of Product Warranty Reserve (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Details
Beginning balance	$ 125	$ 150
Additions to warranty reserve	149	98
Warranty costs	(147)	(123)
Ending balance	$ 127	$ 125

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Note 1 - Nature of Operations and Summary of Significant Accounting Policies: Revenue Recognition: Schedule of Revenues by Recognition Method Applied (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Sales	$ 35,298	$ 26,466
Other	1,818	1,711
Contracts Accounted for under Percentage of Completion
Sales	19,827	14,085
Completed Contract
Sales	$ 13,653	$ 10,670

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Note 1 - Nature of Operations and Summary of Significant Accounting Policies: Other Comprehensive Loss: Schedule of Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Apr. 21, 2015	Dec. 31, 2014
Details
Additional minimum pension liability	$ (2,404)	$ 28,156	$ (33,625)
Total accumulated other comprehensive loss	$ (2,404)		$ (33,625)

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Note 1 - Nature of Operations and Summary of Significant Accounting Policies: Liquidity (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Apr. 21, 2015	Dec. 31, 2014	Dec. 31, 2013
Details
Pension Plan Settlement Agreement, Amount Payable		$ 10,500
Pension Plan Settlement Agreement, Stock Payable		88,117
Pension Plan Settlement Agreement, Payment Schedule	The Company is no longer incurring expenses related to the terminated Pension Plan but as of December 31, 2015 is responsible for eleven annual installment payments of $750 to the PBGC
Cash and cash equivalents	$ 3,734		$ 7,038	$ 3,376

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Note 2 - Definite-lived Intangible Assets and Goodwill: Schedule of Intangible Assets and Goodwill (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Gross Carrying Amount	$ 630	$ 630
Accumulated Amortization	$ (603)	(562)
Maintenance And Legacy Customers
Weighted Avg. Amortization Period in Years	10 years
Gross Carrying Amount	$ 350	350
Accumulated Amortization	$ (335)	(308)
Planetarium Shows
Weighted Avg. Amortization Period in Years	10 years
Gross Carrying Amount	$ 280	280
Accumulated Amortization	$ (268)	$ (254)

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Note 2 - Definite-lived Intangible Assets and Goodwill (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2006
Details
Amortization expense	$ 41	$ 47
Goodwill	$ 635	$ 635
Payments to Acquire Businesses, Gross			$ 2,884

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Note 3 - Costs and Estimated Earnings On Uncompleted Contracts: Schedule of Costs and Estimated Earnings on Uncompleted Contracts (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Details
Total accumulated costs and estimated earnings on uncompleted contracts	$ 33,445	$ 29,629
Less total billings on uncompleted contracts	(34,745)	(33,106)
Accumulated costs and estimated earnings on uncompleted contracts, net	(1,300)	(3,477)
Costs in Excess of Billings	2,695	1,699
Billings in excess of costs and estimated earnings on uncompleted contracts	$ (3,995)	$ (5,176)

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Note 4 - Leases and Gain On Disposal of Building Assets (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Details
Operating Leases, Rent Expense	$ 216	$ 230
Base Rent After Lease Extension	549
Book Value of Disposed Building Assets	2,532
Extinguishment of Debt, Amount	3,152
Gain from Building disposal and Lease extinguishment, to be recognized	620
Gain on Building	21
Gain from extinguishment of deferred rent credit, to be recognized	$ 1,526
Gain from extinguishment of deferred rent credit		$ 51

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Note 4 - Leases and Gain On Disposal of Building Assets: Schedule of Future Minimum Rental Payments for Operating Leases (Details) $ in Thousands	Dec. 31, 2015 USD ($)
2016	$ 120
2017	120
2018	136
2019	109
Total	485
Rent Expense
2016	549
2017	549
2018	565
2019	475
Total	2,138
Gain on Building
2016	(124)
2017	(124)
2018	(124)
2019	(106)
Total	(478)
Deferred Rent Credit
2016	(305)
2017	(305)
2018	(305)
2019	(260)
Total	$ (1,175)

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Note 5 - Employee Retirement Benefit Plans (Details) - USD ($) $ in Thousands			12 Months Ended
	May. 01, 2015	Apr. 23, 2015	Dec. 31, 2015	Dec. 31, 2014	Apr. 21, 2015
Pension Plan Settlement Agreement, Amount Payable					$ 10,500
Pension Plan Settlement Agreement, Payment Schedule			with $1,500 due within ten days following the effective date of the Pension Settlement Agreement and the remainder paid in twelve annual installments of $750 beginning on October 31, 2015
Pension Plan Settlement Agreement, Stock Payable					88,117
Stock issued pursuant to Pension Plan Settlement Agreement		88,117
Pension Contributions	$ 1,500
Settled ERISA Liabilities					$ 46,000
Line of Credit Facility, Maximum Borrowing Capacity			$ 1,100
Stock Issued During Period, Value, Other		$ 70
Pension Settlement Obligation, Interest Rate					7.00%
401(k) Deferred Savings Plan
Contributions			168	$ 197
Intercreditor Agreement
Line of Credit Facility, Maximum Borrowing Capacity			6,500
Second Intercreditor Agreement
Line of Credit Facility, Maximum Borrowing Capacity			$ 3,000

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Note 5 - Employee Retirement Benefit Plans: Schedule of Settlement of Pension Plan Liabilities (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Apr. 21, 2015	Dec. 31, 2014
Details
Unfunded Pension Plan Liability		$ 35,870
Market value of common shares issued from treasury		(70)
Pension Settlement Obligation	$ (5,624)	(7,644)
Total consideration to PBGC		(7,714)
Total gain from settlement of Pension Plan Liabilities		28,156
Pension settlement	(3,620)
Other Comprehensive Income	31,776
Contribution to total comprehensive income	(2,404)	28,156	$ (33,625)
Current portion of pension settlement obligation	356
Pension settlement obligation, net of current portion	5,268
Pension Settlement Obligation	$ 5,624	$ 7,644

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Note 5 - Employee Retirement Benefit Plans: Schedule of Costs of Retirement Plans, changes in benefit obligation (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Actuarial loss		$ (15,710)
Pension Plan
Projected benefit obligation as of beginning of the year	$ 64,831	48,091
Fair value of plan assets - beginning of year	29,721	29,073
Actual return on plan assets	1,547	1,125
Contributions	0	0
Transfer out upon termination	(30,929)	0
Fair value of plan assets - end of year	0	29,721
Service cost	0	0
Interest cost	617	2,275
Actuarial loss	1,690	14,942
Benefits paid	(339)	(477)
Transfer of benefit obligation upon termination	(66,799)	0
Projected benefit obligation as of beginning of the year	0	64,831
Supplemental Executive Retirement Plan
Projected benefit obligation as of beginning of the year	4,871	4,846
Fair value of plan assets - beginning of year	0	0
Actual return on plan assets	0	0
Contributions	497	501
Transfer out upon termination	0	0
Fair value of plan assets - end of year	0	0
Service cost	0	0
Interest cost	177	218
Actuarial loss	769	308
Benefits paid	(497)	(501)
Transfer of benefit obligation upon termination	0	0
Projected benefit obligation as of beginning of the year	$ 5,320	$ 4,871

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Note 5 - Employee Retirement Benefit Plans: Schedule of Amounts Recognized in Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Pension Plan
Unfunded status	$ 0	$ (35,111)
Accrued PBGC insurance premiums	0	(629)
Unrecognized net actuarial loss	0	31,971
Unrecognized prior service cost	0	0
Net amount recognized	0	(3,769)
Supplemental Executive Retirement Plan
Unfunded status	(5,320)	(4,871)
Accrued PBGC insurance premiums	0	0
Unrecognized net actuarial loss	2,415	1,713
Unrecognized prior service cost	(11)	(59)
Net amount recognized	$ (2,916)	$ (3,217)

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Note 5 - Employee Retirement Benefit Plans: Schedule of Amounts Recognized in Balance Sheet (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Accumulated other comprehensive loss	$ (2,404)	$ (33,625)
Pension Plan
Accrued liability	0	(35,111)
Accrued PBGC insurance premiums	0	(629)
Accumulated other comprehensive loss	0	31,971
Net amount recognized	0	(3,769)
Supplemental Executive Retirement Plan
Accrued liability	(5,320)	(4,871)
Accrued PBGC insurance premiums	0	0
Accumulated other comprehensive loss	2,404	1,654
Net amount recognized	$ (2,916)	$ (3,217)

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Note 5 - Employee Retirement Benefit Plans: Schedule of Net Periodic Benefit Cost (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Pension Plan
Service cost	$ 0	$ 0
Interest cost	617	2,275
Expected return on assets	(585)	(2,298)
Amortization of actuarial loss	195	406
Amortization of prior year service cost	0	0
Net periodic benefit cost	227	383
Insurance premium due PBGC	99	545
Supplemental Executive Retirement Plan
Service cost	0	0
Interest cost	177	218
Expected return on assets	0	0
Amortization of actuarial loss	68	50
Amortization of prior year service cost	(49)	(49)
Net periodic benefit cost	196	219
Insurance premium due PBGC	$ 0	$ 0

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Note 5 - Employee Retirement Benefit Plans: Employee Retirement Benefit Plans, Details 2 (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Pension Expenses for the period	$ 522	$ 1,147
Actuarial gain (loss)		$ (15,710)
Assumptions Used Calculating Benefit Obligation, Discount Rate	3.80%	4.80%
Assumptions Used Calculating Net Periodic Benefit Cost, Discount Rate	3.80%	4.80%
Assumptions Used Calculating Net Periodic Benefit Cost, Expected Long-term Return on Assets	8.00%
Insurance Premium Due To The PBGC
Insurance premium due PBGC		$ 394

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Note 5 - Employee Retirement Benefit Plans: Schedule of Allocation of Plan Assets (Details)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Equity Securities
Target %	60.00%
Actual %		61.00%
Debt Securities
Target %	25.00%
Actual %		39.00%
Real Estate
Target %	5.00%
Actual %		0.00%
Hedge Funds
Target %	10.00%
Actual %		0.00%

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Note 5 - Employee Retirement Benefit Plans: Schedule of Changes in Fair Value of Plan Assets (Details) - Pension Plan - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Pension Plan, Fair Value of Plan Assets	$ 0	$ 29,721	$ 29,073
Equity Securities
Pension Plan, Fair Value of Plan Assets		18,227
Debt Securities
Pension Plan, Fair Value of Plan Assets		11,449
Money Market Funds
Pension Plan, Fair Value of Plan Assets		45
Fair Value, Inputs, Level 1
Pension Plan, Fair Value of Plan Assets		29,721
Fair Value, Inputs, Level 1 | Equity Securities
Pension Plan, Fair Value of Plan Assets		18,227
Fair Value, Inputs, Level 1 | Debt Securities
Pension Plan, Fair Value of Plan Assets		11,449
Fair Value, Inputs, Level 1 | Money Market Funds
Pension Plan, Fair Value of Plan Assets		45
Fair Value, Inputs, Level 2
Pension Plan, Fair Value of Plan Assets		0
Fair Value, Inputs, Level 2 | Equity Securities
Pension Plan, Fair Value of Plan Assets		0
Fair Value, Inputs, Level 2 | Debt Securities
Pension Plan, Fair Value of Plan Assets		0
Fair Value, Inputs, Level 2 | Money Market Funds
Pension Plan, Fair Value of Plan Assets		0
Fair Value, Inputs, Level 3
Pension Plan, Fair Value of Plan Assets		0
Fair Value, Inputs, Level 3 | Equity Securities
Pension Plan, Fair Value of Plan Assets		0
Fair Value, Inputs, Level 3 | Debt Securities
Pension Plan, Fair Value of Plan Assets		0
Fair Value, Inputs, Level 3 | Money Market Funds
Pension Plan, Fair Value of Plan Assets		$ 0

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Note 5 - Employee Retirement Benefit Plans: Employee Retirement Benefit Plans, Details 3 (Details) $ in Thousands	Dec. 31, 2015 USD ($)
Details
Lien against assets of the company for unpaid pension contributions	$ 6,979

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Note 5 - Employee Retirement Benefit Plans: Schedule of Expected Benefit Payments (Details) - Supplemental Executive Retirement Plan $ in Thousands	Dec. 31, 2015 USD ($)
2015	$ 480
2016	516
2017	507
2018	449
2019	441
2021-2025	$ 2,195

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Note 6 - Debt: Schedule of Long-term Debt (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Long-term Debt	$ 2,174	$ 2,362
Current portion of long-term debt	(199)	(2,362)
Long-term debt, net of current portion	1,975	0
First Mortgage Note Payable
Debt Instrument, Periodic Payment	$ 23
Debt Instrument, Interest Rate, Effective Percentage	5.75%
Debt Instrument, Maturity Date	Jan. 01, 2024
Long-term Debt	$ 1,789	1,957
Second Mortgage Note Payable
Debt Instrument, Periodic Payment	$ 4
Debt Instrument, Interest Rate, Effective Percentage	5.75%
Debt Instrument, Maturity Date	Oct. 01, 2028
Long-term Debt	$ 385	$ 405

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Note 6 - Debt: Schedule of Principal maturities (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Details
2016	$ 199
2017	211
2018	224
2019	237
2020	251
Thereafter	1,052
Long-term Debt	$ 2,174	$ 2,362

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Note 6 - Debt (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Sep. 30, 2014	Jun. 30, 2014	Jan. 14, 2004
Debt Instrument, Collateral	The Mortgage Notes are secured by the real property occupied by Spitz pursuant to a Mortgage and Security Agreement. The real property had a carrying value of $4,301 as of December 31, 2015. The Mortgage Notes are guaranteed by E&S.
Debt Instrument, Covenant Description	One of the covenants requires Spitz to maintain tangible net worth of at least $6,000 measured upon issuance of quarterly and annual financial statements.
Line of Credit Facility, Maximum Borrowing Capacity	$ 1,100
Line of Credit Facility, Interest Rate Description	Under the line of credit agreement, interest is charged on amounts borrowed at the lender's prime rate less 0.25%.
Long-term Line of Credit	$ 0
Sale Leaseback Transaction, Date	November 2009
Sale Leaseback Transaction, Gross Proceeds, Financing Activities	$ 2,500
Sale Leaseback Transaction, Annual Rental Payments	$ 501
Sale Leaseback Transaction, Lease Terms	The sublease agreement had a term of 5 years with an option for two subsequent 5-year renewal periods. The agreement provided the Company with a 5-year option to repurchase all of the buildings under lease or only one of the buildings known as the Substation along with the lease interest in the land.
Sale Leaseback Transaction, Net Proceeds, Financing Activities	$ 2,329
Sale Leaseback Transaction, Amount Due under Financing Arrangement	125
Sale Leaseback Transaction, Other Payments Required	15
Sale Leaseback Transaction, Monthly Rental Payments	$ 31
Sale Leaseback Transaction, Imputed Interest Rate	20.00%
Extinguishment of Debt, Amount	$ 3,152
Book Value of Disposed Building Assets	2,532
Land
Sale Leaseback Transaction, Annual Rental Payments	126
Building
Sale Leaseback Transaction, Annual Rental Payments	$ 375
Spitz, Inc.
Tangible Net Worth		$ 5,744	$ 5,801	$ 5,914
First Mortgage Note Payable
Debt Instrument, Face Amount					$ 3,200
Long-term Debt, Maturities, Repayment Terms	The First Mortgage Note requires repayment in monthly installments of principal and interest over 20 years. On each third anniversary of the First Mortgage Note, the interest rate is adjusted to the greater of 5.75% or 3% over the Three-Year Constant Maturity Treasury Rate published by the United States Federal Reserve ('3YCMT').
Debt Instrument, Interest Rate, Basis for Effective Rate	On January 14, 2016, the 3YCMT was 1.14% and the interest rate on the First Mortgage Note remained at 5.75% per annum. As a result, the monthly installment amount remained at $23.
Second Mortgage Note Payable
Debt Instrument, Interest Rate, Basis for Effective Rate	On September 11, 2013, the fifth anniversary of the Second Mortgage Note, the 3YCMT was 0.88%. As a result, interest continues at 5.75% until possible adjustment on the next 5-year anniversary. The monthly installment also remains unchanged at $4.

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Note 7 - Income Taxes: Schedule of Effective Income Tax Rate Reconciliation (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Details
Income tax benefit at U.S. federal statutory rate	$ 440	$ 436
State tax benefit (provision) (net of federal income tax benefit)	(14)	42
Change in valuation allowance attributable to operations	4,146	(332)
Change in effective tax rate	(4,064)	0
Pension settlement	(466)	0
Other, net	(31)	(169)
Income tax benefit (provision)	$ 12	$ (23)

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Note 7 - Income Taxes: Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Details
Property and equipment, principally due to differences in depreciation	$ (722)	$ 845
Inventory reserves and other inventory-related temporary basis differences	696	663
Warranty, vacation, deferred rent and other liabilities	883	1,114
Retirement liabilities	1,088	2,427
Net operating loss carryforwards	62,194	63,511
Credit carryforwards	817	825
Other	1,227	944
Total deferred income tax assets	66,183	70,329
Less valuation allowance	(66,183)	(70,329)
Net deferred income tax assets	$ 0	$ 0

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Note 7 - Income Taxes: Schedule of Worldwide Income Before Income Taxes (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Details
United States	$ (1,296)	$ (1,282)
Foreign	0	0
Total	$ (1,296)	$ (1,282)

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Note 7 - Income Taxes: Schedule of Components of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Current
U.S. federal	$ 0	$ 0
State	12	(23)
Income tax benefit (provision)	12	(23)
Deferred
U.S. federal	(4,068)	985
State	(78)	(653)
Total	(4,146)	332
Valuation allowance (increase) decrease	$ 4,146	$ (332)
Total

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Note 7 - Income Taxes (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Minimum
Operating Loss Carryforwards, Expiration Date	Dec. 31, 2018
Maximum
Operating Loss Carryforwards, Expiration Date	Dec. 31, 2033
Internal Revenue Service (IRS)
Operating Loss Carryforwards	$ 168,400
Internal Revenue Service (IRS) | Expired
Operating Loss Carryforwards	0	$ 0
Internal Revenue Service (IRS) | 2015 and 2016 Expiration
Operating Loss Carryforwards	800
State and Local Jurisdiction | Expire on Various Dates
Operating Loss Carryforwards	$ 149,700

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Note 8 - Commitments and Contingencies (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Letters of Credit Outstanding, Amount	$ 600
Other Assets
Restricted Cash and Cash Equivalents	$ 0	$ 0

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Note 9 - Stock Option Plan (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Options, Granted, Weighted Average Grant Date Fair Value	$ 0.39	$ 0.13
Options exercisable, weighted average remaining contractual term	3 years 4 months 24 days	3 years 4 months 24 days
Options outstanding, weighted average remaining contractual term	4 years 9 months 18 days	4 years 8 months 12 days
Total unrecognized share-based compensation cost	$ 35	$ 10
Total unrecognized share-based compensation, compensation cost not yet recognized, weighted-average period	1 year 10 months 24 days	1 year 10 months 24 days
Allocated Share-based Compensation Expense	$ 41	$ 16
2004 Stock Incentive Plan Of Evans Sutherland Computer Corporation
Plan Description	In 2014, stockholders approved the adoption of the Evans & Sutherland Computer Corporation 2014 Stock Incentive Plan ('2014 Plan') which replaced the expired 2004 Stock Incentive Plan of Evans & Sutherland Computer Corporation ('2004 Plan'). The 2014 Plan is a stock incentive plan that provides for the grant of options and restricted stock awards to employees and for the grant of options to non-employee directors essentially the same as the 2004 Plan. Under the 2014 Plan, non-employee directors may continue to receive an annual option grant for no more than 10,000 shares. New non-employee directors may also continue to receive an option grant for no more than 10,000 shares upon their appointment or election. With the adoption of the 2014 Plan, no additional options can be issued under the 2004 Plan. Options granted under the 2004 Plan are still held by recipients and will continue to be subject to the terms and conditions of the 2004 plan which are essentially the same as the 2014 Plan. The 2014 Plan continues a minimum exercise price for options of 110% of fair market value on the date of grant.
Number of Shares Authorized	1,303,713

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Note 9 - Stock Option Plan: Schedule of Stock Option Plan Activity (Details) - $ / shares shares in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Details
Outstanding at beginning of year	1,333	1,235
Outstanding at beginning of year, weighted average exercise price	$ 2.08	$ 2.62
Granted	221	200
Granted, weighted average exercise price	$ 0.39	$ 0.13
Exercised
Exercised, weighted average exercise price
Forfeited or expired	(84)	(102)
Forfeited or expired, weighted average exercise price	$ 7.23	$ 4.85
Outstanding as of end of the period	1,470	1,333
Outstanding as of end of the period, weighted average exercise price	$ 1.53	$ 2.08
Exercisable as of end of the period	1,065	996
Exercisable as of end of the period, weighted average exercise price	$ 2.01	$ 2.74

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Note 9 - Stock Option Plan: Schedule of Stock Options Valuation Assumptions (Details)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Details
Expected life (in years)	3 years 6 months	3 years 6 months
Risk-free interest rate	0.91%	0.74%
Expected Volatility	340.00%	340.00%
Dividend yield	0.00%	0.00%

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Note 10 - Preferred Stock (Details) - shares	Dec. 31, 2015	Dec. 31, 2014
Preferred Stock, shares authorized	10,000,000	10,000,000
Preferred Stock, shares outstanding
Preferred Class A
Preferred Stock, shares authorized	5,000,000
Preferred Stock, shares outstanding	0	0
Preferred Class B
Preferred Stock, shares authorized	5,000,000
Preferred Stock, shares outstanding	0	0

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Note 11 - Geographic Information: Schedule of Sales by Geographic Location (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Sales	$ 35,298	$ 26,466
UNITED STATES
Sales	16,809	11,639
International
Sales	$ 18,489	$ 14,827

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Note 12 - Significant Customers (Details)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Accounts Receivable | Customer A
Concentration Risk, Percentage	14.00%
Accounts Receivable | Customer B
Concentration Risk, Percentage	14.00%
Accounts Receivable | Customer C
Concentration Risk, Percentage	13.00%
Accounts Receivable | Customer D
Concentration Risk, Percentage	13.00%
Accounts Receivable | Customer E
Concentration Risk, Percentage		23.00%
Accounts Receivable | Customer G
Concentration Risk, Percentage		12.00%
Costs and Estimated Earnings in Excess of Billings | Customer E
Concentration Risk, Percentage	41.00%	37.00%
Costs and Estimated Earnings in Excess of Billings | Customer F
Concentration Risk, Percentage	12.00%
Costs and Estimated Earnings in Excess of Billings | Customer H
Concentration Risk, Percentage		15.00%
Sales Revenue, Net | Customer Concentration Risk
Concentration Risk, Percentage	0.00%	0.00%