Annual report pursuant to Section 13 and 15(d)

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

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CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME - USD ($)
 12 Months Ended
Dec. 31, 2015
Dec. 31, 2014
Condensed Statements Of Income And Comprehensive Income    
REVENUE $ 16,565,000 $ 12,309,000
OPERATING EXPENSES:    
Costs of revenue 5,506,000 3,510,000
Professional fees and related costs 2,331,000 1,160,000
General and administrative 2,874,000 2,033,000
Amortization of patents 1,655,000 1,650,000
Stock-based compensation $ 272,000 333,000
Contingent patent cost 900,000
TOTAL OPERATING EXPENSES $ 12,638,000 9,586,000
OPERATING INCOME 3,927,000 2,723,000
OTHER INCOME (EXPENSES):    
Interest income, net $ 58,000 37,000
Loss on sale of securities available-for-sale (reclassified from accumulated other comprehensive income for previously unrealized losses on securities) (51,000)
INCOME BEFORE INCOME TAXES $ 3,985,000 2,709,000
INCOME TAXES (BENEFIT)    
Current 93,000 27,000
Deferred taxes (benefit) (215,000) 916,000
Total Income Taxes (Benefit) (122,000) 943,000
NET INCOME $ 4,107,000 $ 1,766,000
Net Income Per Share    
Basic $ 0.17 $ 0.07
Diluted $ 0.17 $ 0.07
Weighted average number of common shares outstanding:    
Basic 23,501,987 25,170,346
Diluted 24,482,557 26,928,330
NET INCOME $ 4,107,000 $ 1,766,000
OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX:    
Reclassification adjustment for loss included in net income 51,000
Unrealized holding loss on securities available-for-sale arising during the year $ (18,000) (37,000)
Total other comprehensive income (loss), net of tax benefit (18,000) 14,000
COMPREHENSIVE INCOME $ 4,089,000 $ 1,780,000