Investments

Marketable Securities

All of the Company's marketable securities at September 30, 2015, and December 31, 2014, were classified as "available-for-sale" securities. Changes in fair value are recognized in stockholders' equity as "other comprehensive income (loss)", except for other-than-temporary impairments, which are reflected as a reduction of cost and charged to operations.

The Company's marketable securities at September 30, 2015, include investments in the common units of Steel Partners Holdings L.P. ("SPLP"), which beneficially owned approximately 58.2% of the Company's common stock as of September 30, 2015. The SPLP common units held by the Company are classified as "available-for-sale" securities. As of September 30, 2015, the Company held 442,337 SPLP common units that had a fair value of approximately $7.3 million and an unrealized loss of approximately $0.4 million.

Marketable securities at September 30, 2015, consisted of the following:



	Cost			Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
	(in thousands)
Short-term deposits	$	45,198		$	—	$	—		$	45,198
Mutual funds	11,835			1,665		—			13,500
Corporate securities	82,044			5,091		(3,844		)	83,291
Corporate obligations	34,034			228		(4,418		)	29,844
Total available-for-sale securities	173,111			6,984		(8,262		)	171,833
Amounts classified as cash equivalents	(45,198		)	—		—			(45,198		)
Amounts classified as marketable securities	$	127,913		$	6,984	$	(8,262	)	$	126,635

Marketable securities at December 31, 2014, consisted of the following:



	Cost			Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
	(in thousands)
Short-term deposits	$	42,681		$	—	$	—		$	42,681
Mutual funds	17,030			4,262		(322		)	20,970
Corporate securities	103,761			7,821		(23,732		)	87,850
Corporate obligations	32,486			592		(3,441		)	29,637
Total available-for-sale securities	195,958			12,675		(27,495		)	181,138
Amounts classified as cash equivalents	(42,681		)	—		—			(42,681		)
Amounts classified as marketable securities	$	153,277		$	12,675	$	(27,495	)	$	138,457

Proceeds from sales of marketable securities were $39.4 million and $105.1 million for the nine months ended September 30, 2015 and 2014, respectively, and $22.8 million and $9.4 million for the three months ended September 30, 2015 and 2014, respectively. The Company determines gains and losses from sales of marketable securities based on specific identification of the securities sold. Gross realized gains and losses from sales of marketable securities, all of which are reported as a component of "Other income (expense), net" in the consolidated statements of operations for the three and nine months ended September 30, 2015 and 2014, were as follows:



	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
	(in thousands)
Gross realized gains	$	2,135		$	681		$	4,891		$	7,077
Gross realized losses	(5,528		)	(1,683		)	(6,321		)	(3,012		)
Realized gains (losses), net	$	(3,393	)	$	(1,002	)	$	(1,430	)	$	4,065

The fair value of the Company’s marketable securities with unrealized losses at September 30, 2015, and the duration of time that such losses had been unrealized, were as follows:



	Less than 12 Months					12 Months or Greater					Total
	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
	(in thousands)
Corporate securities	$	54,093	$	(3,810	)	$	178	$	(34	)	$	54,271	$	(3,844	)
Corporate obligations	8,709		(3,312		)	3,705		(1,106		)	12,414		(4,418		)
Total	$	62,802	$	(7,122	)	$	3,883	$	(1,140	)	$	66,685	$	(8,262	)

The fair value of the Company’s marketable securities with unrealized losses at December 31, 2014, all of which had unrealized losses for periods of less than twelve months, were as follows:



	Fair Value		Gross Unrealized Losses
	(in thousands)
Corporate securities	$	39,869	$	(23,732	)
Corporate obligations	13,530		(3,441		)
Mutual funds	4,873		(322		)
Total	$	58,272	$	(27,495	)

Gross unrealized losses primarily related to losses on corporate securities and corporate obligations, which primarily consist of investments in equity and debt securities of publicly-traded entities. Based on the Company's evaluation of such securities, it has determined that certain unrealized losses represented other-than-temporary impairments. This determination was based on several factors, including adverse changes in the market conditions and economic environments in which the entities operate. The Company recognized impairment charges of approximately $7.9 million and $30.6 million for the three and nine months ended September 30, 2015, respectively, equal to the costs basis of such securities in excess of their fair values. The Company has determined that there was no indication of other-than-temporary impairments on its other investments with unrealized losses as of September 30, 2015. This determination was based on several factors, including the length of time and extent to which fair value has been less than the cost basis, the financial condition and near-term prospects of the entity, and the Company's intent and ability to hold the corporate securities for a period of time sufficient to allow for any anticipated recovery in market value.

The amortized cost and estimated fair value of available-for-sale debt securities and marketable securities with no contractual maturities at September 30, 2015, by contractual maturity, were as follows:



	Cost		Estimated Fair Value
	(in thousands)
Debt securities that mature in more than three years	$	34,034	$	29,844
Securities with no contractual maturities	139,077		141,989
Total	$	173,111	$	171,833

Financial Instrument Obligations

Financial instrument obligations consisted of the following:



	September 30, 2015				December 31, 2014
	Initial Obligation		Estimated Fair Value		Initial Obligation		Estimated Fair Value
	(in thousands)
Corporate securities	$	675	$	1,024	$	666	$	621
Market indices	18,685		19,067		18,685		20,451
Covered call options	113		80		7		4
Naked put options	—		—		109		235
Total	$	19,473	$	20,171	$	19,467	$	21,311

For the three and nine months ended September 30, 2015, the Company recognized gains on the financial instrument obligations totaling $1.3 million and $1.1 million, respectively, and for the three and nine months ended September 30, 2014, the Company incurred losses on the financial instrument obligations totaling $0.1 million and $0.8 million, respectively, all of which are included as a component of "Other income (expense), net" in the Company's consolidated statements of operations.

Equity-Method Investments

In January 2013, the Company acquired a 40% membership interest in Again Faster LLC ("Again Faster"), a fitness equipment company. In response to adverse developments in its business, in 2015 Again Faster began seeking out additional investors or buyers for the business and is currently pursuing other strategic alternatives, including liquidation. Based on the current state of the business and the available strategic alternatives, the Company fully impaired its investment in Again Faster as of September 30, 2015.

In August 2013, the Company acquired approximately 44.7% of the common stock of iGo, Inc. (“iGo”), a provider of accessories for mobile devices. iGo is accounted for using the traditional method of accounting for equity-method investments, with the Company recognizing its equity in the income and losses of each entity on a one-quarter lag basis.

In May 2014, the Company increased its holdings of the common stock of API Technologies Corp. (“API”), a designer and manufacturer of high performance systems, subsystems, modules, and components, to 11,377,192 shares through the acquisition of 1,666,666 shares on the open market. Upon acquiring such shares the Company held approximately 20.6% of the total outstanding common stock of API. Effective as of that date the investment in API has been accounted for as an equity-method investment using the fair value option, with changes in fair value based on the market price of API's common stock recognized currently as income or loss from equity method investees. The Company elected the fair value option to account for its investment in API in order to more appropriately reflect the value of API in its financial statements. Prior to such time the investment in API was accounted for as an available-for-sale security, and upon the change in classification the Company recognized a loss of approximately $0.6 million that had previously been included as a component of "accumulated other comprehensive income".

In January 2015, two members of the Company's board of directors were appointed to the eight-member board of directors of Aviat Networks, Inc. ("Aviat"), a global provider of microwave networking solutions. At the time of the appointment, the Company held 8,042,892 shares of Aviat, or approximately 12.9% of the total outstanding common stock. Effective as of the date of the appointment, the investment in Aviat has been accounted for as an equity-method investment as the Company’s voting interest and board representation provide it with significant influence over Aviat's operations. The Company elected the fair value option to account for its investment in Aviat, with changes in fair value based on the market price of Aviat's common stock recognized currently as income or loss from equity method investees, in order to more appropriately reflect the value of Aviat in its financial statements. Prior to such time the investment in Aviat was accounted for as an available-for-sale security, and upon the change in classification the Company recognized a loss of approximately $2.8 million that had previously been included as a component of "accumulated other comprehensive income".

The following table summarizes the Company's equity-method investments.



	Ownership				Carrying Value				Income (Loss) Recognized
									Three Months Ended						Nine Months Ended
	September 30, 2015		December 31, 2014		September 30, 2015		December 31, 2014		September 30, 2015			September 30, 2014			September 30, 2015			September 30, 2014
					(in thousands)
Traditional equity method
Again Faster	40.0	%	40.0	%	$	—	$	3,105	$	(2,548	)	$	(263	)	$	(3,105	)	$	(556	)
iGo	45.7	%	46.9	%	2,923		2,600		52			(121		)	323			(1,926		)

Fair value option
API	20.6	%	20.6	%	24,812		24,355		(3,888		)	(4,459		)	457			(920		)
Aviat	12.9	%			8,365				(1,769		)	—			(2,493		)	—
Total					$	36,100	$	30,060	$	(8,153	)	$	(4,843	)	$	(4,818	)	$	(3,402	)

The losses recognized for Again Faster for the three and nine months ended September 30, 2015, include an impairment charge of $2.5 million. Based on the closing market price of iGo’s publicly-traded shares, the value of the Company’s investment in iGo was approximately $4.1 million at September 30, 2015.

Other Investments

The Company's other long-term investments at December 31, 2014, included a $25.0 million cost-method investment in a limited partnership that co-invested with other private investment funds in a public company. The limited partnership was liquidated in August 2015, with the Company receiving its proportionate share of the common stock of the public company investee. Upon liquidation, the Company recognized a gain on the non-monetary exchange of $9.3 million based on the fair value of the shares received of $34.3 million. The shares of common stock of the public company investee received are reported with the Company's marketable securities and are classified as "available-for-sale" securities at September 30, 2015.

The Company's other long-term investments at September 30, 2015, include an investment in a venture capital fund totaling $0.5 million and a promissory note with an amortized cost of $3.0 million, which is a reasonable approximation of fair value at September 30, 2015.