NOTE 4: Cash, Cash Equivalents, and Investments

Cash, cash equivalents, and investments consisted of the following (in thousands):


	June 30, 2013		December 31, 2012

Cash	$	34,467	$	34,986
Cash equivalents		12,947		5,098
Money market instruments		460		5,076

Cash and cash equivalents		47,874		45,160


Corporate bonds		80,386		46,001
Asset-backed securities		26,910		17,666
Municipal bonds		14,443		16,224
Sovereign bonds		7,383		3,986
Commercial paper		3,000		—
Corporate stock		1,669		2,131
Agency bonds		1,498		7,482
Covered bonds		—		5,618
Treasury bills		—		5,997

Short-term investments		135,289		105,105


Corporate bonds		109,780		100,072
Treasury bills		52,415		36,276
Asset-backed securities		41,266		34,710
Sovereign bonds		23,052		10,606
Municipal bonds		14,140		17,846
Agency bonds		—		29,441
Covered bonds		—		5,564
Limited partnership interest (accounted for using cost method)		2,455		3,740

Long-term investments		243,108		238,255

	$	426,271	$	388,520

The Company’s investment portfolio includes corporate bonds, asset-backed securities, treasury bills, sovereign bonds, municipal bonds, commercial paper, and agency bonds. Corporate bonds consist of debt securities issued by both domestic and foreign companies; asset-backed securities consist of debt securities collateralized by pools of receivables or loans with credit enhancement; treasury bills consist of debt securities issued by both the U.S. and foreign governments; sovereign bonds consist of direct debt issued by foreign governments; municipal bonds consist of debt securities issued by state and local government entities; commercial paper consists of debt instruments issued by corporations or financial institutions with high quality debt ratings; and agency bonds consist of domestic or foreign obligations of government agencies and government sponsored enterprises that have government backing.

During the fourth quarter of 2012, the Company purchased equity securities, representing stock in a publicly-traded U.S. company, with an aggregate fair value of $2,131,000 as of December 31, 2012. As of June 30, 2013, these securities had an aggregate fair value of $1,669,000, resulting in an unrealized loss of $462,000.

The following tables summarize the Company’s available-for-sale investments as of June 30, 2013 (in thousands):


	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value

Short-term:
Corporate bonds	$	80,547	$	119	$	(280	)	$	80,386
Asset-backed securities		27,076		6		(172	)		26,910
Municipal bonds		14,416		28		(1	)		14,443
Sovereign bonds		7,396		—		(13	)		7,383
Commercial paper		3,000		—		—			3,000
Agency bonds		1,498		—		—			1,498

Long-term:
Corporate bonds		109,785		373		(378	)		109,780
Treasury bills		52,487		—		(72	)		52,415
Asset-backed securities		41,539		6		(279	)		41,266
Sovereign bonds		23,199		17		(164	)		23,052
Municipal bonds		14,110		62		(32	)		14,140

	$	375,053	$	611	$	(1,391	)	$	374,273

The following table summarizes the Company’s gross unrealized losses and fair values for available-for-sale investments in an unrealized loss position as of June 30, 2013 (in thousands):


	Unrealized Loss Position For:
	Less than 12 Months					12 Months or Greater					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Corporate bonds	$	107,235	$	(658	)	$	—	$	—		$	107,235	$	(658	)
Sovereign bonds		23,007		(177	)		—		—			23,007		(177	)
Municipal bonds		5,846		(33	)		—		—			5,846		(33	)
Asset- backed securities		59,180		(449	)		1,570		(2	)		60,750		(451	)
Treasury bills		50,617		(72	)		—		—			50,617		(72	)

	$	245,885	$	(1,389	)	$	1,570	$	(2	)	$	247,455	$	(1,391	)

As of June 30, 2013, the Company did not recognize an other-than-temporary impairment of these investments. In its evaluation, management considered the type of security, the credit rating of the security, the length of time the security has been in a loss position, the size of the loss position, our intent and ability to hold the security to expected recovery of value, and other meaningful information. The Company does not intend to sell, and is unlikely to be required to sell, any of these available-for-sale investments before its effective maturity or market price recovery.

The Company recorded gross realized gains and gross realized losses on the sale of investments totaling $101,000 and $49,000, respectively, during the three-month period ended June 30, 2013, and $1,233,000 and $238,000, respectively, during the three-month period ended July 1, 2012. The Company recorded gross realized gains and gross realized losses on the sale of investments totaling $150,000 and $67,000, respectively, during the six-month period ended June 30, 2013, and $1,327,000 and $238,000, respectively, during the six-month period ended July 1, 2012.

The following table presents the effective maturity dates of the Company’s available-for-sale investments as of June 30, 2013 (in thousands):


	<1 Year		1-2 Years		2-3 Years		3-4 Years		4-5 Years		Total
Corporate bonds	$	80,386	$	48,477	$	54,059	$	6,729	$	515	$	190,166
Asset-backed securities		26,910		35,072		6,194		—		—		68,176
Treasury bills		—		29,870		22,545		—		—		52,415
Sovereign bonds		7,383		11,263		10,907		—		882		30,435
Municipal bonds		14,443		8,817		2,337		2,491		495		28,583
Commercial paper		3,000		—		—		—		—		3,000
Agency bonds		1,498		—		—		—		—		1,498

	$	133,620	$	133,499	$	96,042	$	9,220	$	1,892	$	374,273

The Company is a Limited Partner in Venrock Associates III, L.P. (Venrock), a venture capital fund. The Company has committed to a total investment in the limited partnership of up to $20,500,000, with an expiration date of December 31, 2013. As of June 30, 2013, the Company contributed $19,886,000 to the partnership. The remaining commitment of $614,000 can be called by Venrock at any time before December 31, 2013. Distributions and contributions are at the discretion of Venrock’s management. No contributions were made during the six-month period ended June 30, 2013. The Company received a cash distribution of $1,285,000 during the second quarter of 2013, which was accounted for as a return of capital.