SAFEGUARD SCIENTIFICS INC, 10-Q filed on 7/26/2018
Quarterly Report
v3.10.0.1
Document and Entity Information - shares
6 Months Ended
Jun. 30, 2018
Jul. 24, 2018
Document Documentand Entity Information [Abstract]    
Entity Registrant Name SAFEGUARD SCIENTIFICS INC  
Entity Central Index Key 0000086115  
Current Fiscal Year End Date --12-31  
Entity Filer Category Accelerated Filer  
Document Type 10-Q  
Document Period End Date Jun. 30, 2018  
Document Fiscal Year Focus 2018  
Document Fiscal Period Focus Q2  
Amendment Flag false  
Entity Common Stock, Shares Outstanding   20,649,746
Trading Symbol SFE  
v3.10.0.1
CONSOLIDATED BALANCE SHEETS - USD ($)
$ in Thousands
Jun. 30, 2018
Dec. 31, 2017
Current Assets:    
Cash and cash equivalents $ 26,006 $ 20,751
Marketable securities 688 4,452
Trading securities 0 3,761
Prepaid expenses and other current assets 3,604 4,644
Total current assets 30,298 33,608
Property and equipment, net 1,357 1,513
Ownership interests in and advances to partner companies 110,432 134,691
Long-term restricted cash equivalents 0 6,336
Other assets 316 316
Total Assets 142,403 176,464
Current Liabilities:    
Accounts payable 255 155
Accrued compensation and benefits 3,687 3,321
Accrued expenses and other current liabilities 2,086 1,851
Convertible senior debentures - current 0 40,485
Total current liabilities 6,028 45,812
Credit facility 78,978 45,321
Credit facility repayment feature liability 2,979 0
Other long-term liabilities 3,197 3,535
Total Liabilities 91,182 94,668
Commitments and contingencies (Note 10)
Equity:    
Preferred stock, $0.10 par value; 1,000 shares authorized 0 0
Common stock, $0.10 par value; 83,333 shares authorized; 21,573 shares issued at June 30, 2018 and December 31, 2017 2,157 2,157
Additional paid-in capital 811,089 812,536
Treasury stock, at cost; 923 and 999 shares at June 30, 2018 and December 31, 2017, respectively (15,451) (17,308)
Accumulated deficit (746,542) (715,476)
Accumulated other comprehensive loss (32) (113)
Total Equity 51,221 81,796
Total Liabilities and Equity $ 142,403 $ 176,464
v3.10.0.1
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares
shares in Thousands
Jun. 30, 2018
Dec. 31, 2017
Statement of Financial Position [Abstract]    
Preferred stock, par value $ 0.10 $ 0.10
Preferred stock, shares authorized 1,000 1,000
Common stock, par value $ 0.10 $ 0.10
Common stock, shares authorized 83,333 83,333
Common stock, shares issued 21,573 21,573
Treasury stock, at cost; 923 and 999 shares at June 30, 2018 and December 31, 2017, respectively 923 999
v3.10.0.1
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)
shares in Thousands, $ in Thousands
3 Months Ended 6 Months Ended
Jun. 30, 2018
Jun. 30, 2017
Jun. 30, 2018
Jun. 30, 2017
Income Statement [Abstract]        
General and administrative expense $ 5,148 $ 4,486 $ 10,738 $ 9,433
Operating loss (5,148) (4,486) (10,738) (9,433)
Other income (loss) (2,452) (89) (3,887) 160
Interest income 666 1,087 1,465 1,888
Interest expense (3,422) (2,112) (6,112) (3,310)
Equity loss (14,540) (23,497) (11,794) (40,499)
Net loss before income taxes (24,896) (29,097) (31,066) (51,194)
Income tax benefit (expense) 0 0 0 0
Net loss $ (24,896) $ (29,097) $ (31,066) $ (51,194)
Net loss per share:        
Basic (in dollars per share) $ (1.21) $ (1.43) $ (1.51) $ (2.51)
Diluted (in dollars per share) $ (1.21) $ (1.43) $ (1.51) $ (2.51)
Weighted average shares used in computing loss per share:        
Basic (in shares) 20,539 20,411 20,523 20,395
Diluted (in shares) 20,539 20,411 20,523 20,395
v3.10.0.1
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)
$ in Thousands
6 Months Ended
Jun. 30, 2018
Jun. 30, 2017
Cash Flows from Operating Activities:    
Net cash used in operating activities $ (13,613) $ (11,407)
Cash Flows from Investing Activities:    
Proceeds from sales of and distributions from companies 14,912 16,462
Acquisitions of ownership interests in companies (250) (8,026)
Advances and loans to companies (7,949) (13,564)
Repayment of advances and loans to companies 10,500 0
Decrease in marketable securities 3,771 10,268
Net cash provided by investing activities 20,984 5,140
Proceeds from credit facility 35,000 50,000
Payments of Debt Issuance Costs (2,252) (5,696)
Repayments of Convertible Debt (41,000) (11,796)
Cash Flows from Financing Activities:    
Issuance of Company common stock, net 0 12
Tax withholdings related to equity-based awards (200) (130)
Net cash provided by (used in) financing activities (8,452) 32,390
Net change in cash, cash equivalents and restricted cash equivalents (1,081) 26,123
Cash, cash equivalents and restricted cash equivalents at beginning of period 27,087 28,394
Cash, cash equivalents and restricted cash equivalents at end of period $ 26,006 $ 54,517
v3.10.0.1
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY - 6 months ended Jun. 30, 2018 - USD ($)
shares in Thousands, $ in Thousands
Total
Accumulated Deficit
AOCI Attributable to Parent
Common Stock
Additional Paid-in Capital
Treasury Stock
Balance at Dec. 31, 2017 $ 81,796 $ (715,476) $ (113) $ 2,157 $ 812,536 $ (17,308)
Balance (in shares) at Dec. 31, 2017       21,573    
Balance (in shares) at Dec. 31, 2017           999
Increase (Decrease) in Stockholders' Equity [Roll Forward]            
Net loss (31,066) (31,066)        
Stock options exercised, net of tax withholdings 0       (16) $ 16
Stock options exercised, net of tax withholdings (in shares)           1
Issuance of restricted stock, net of tax withholdings (200)       (2,041) $ 1,841
Issuance of restricted stock, net of tax withholdings (in shares)           (75)
Stock-based compensation expense 610       610  
Other comprehensive income 81   81      
Balance at Jun. 30, 2018 $ 51,221 $ (746,542) $ (32) $ 2,157 $ 811,089 $ (15,451)
Balance (in shares) at Jun. 30, 2018       21,573    
Balance (in shares) at Jun. 30, 2018           923
v3.10.0.1
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME Statement - USD ($)
$ in Thousands
3 Months Ended 6 Months Ended
Jun. 30, 2018
Jun. 30, 2017
Jun. 30, 2018
Jun. 30, 2017
Statement of Comprehensive Income [Abstract]        
Net loss $ (24,896) $ (29,097) $ (31,066) $ (51,194)
Share of other comprehensive income (loss) of equity method investments 0 5 0 3
Reclassification adjustment for sale of equity method investments (1) 0 81 50
Total comprehensive loss $ (24,897) $ (29,092) $ (30,985) $ (51,141)
v3.10.0.1
General
6 Months Ended
Jun. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
General
General
The accompanying unaudited interim Consolidated Financial Statements of Safeguard Scientifics, Inc. (“Safeguard” or the “Company”) were prepared in accordance with accounting principles generally accepted in the United States of America and the interim financial statement rules and regulations of the SEC. In the opinion of management, these statements include all adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation of the Consolidated Financial Statements. The interim operating results are not necessarily indicative of the results for a full year or for any interim period. Certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations relating to interim financial statements. The Consolidated Financial Statements included in this Form 10-Q should be read in conjunction with Management’s Discussion and Analysis of Financial Condition and Results of Operations included elsewhere in this Form 10-Q and with the Company’s Consolidated Financial Statements and Notes thereto included in the Company’s 2017 Annual Report on Form 10-K.
Liquidity
As of June 30, 2018, the Company had $26.0 million of cash and cash equivalents and $0.7 million of marketable securities for a total of $26.7 million. As of June 30, 2018, the Company had $85.0 million of principal outstanding on its Amended Credit Facility due in May 2020. The Company currently has $15.0 million of availability under the Amended Credit Facility.
In July 2018, the Company sold 39.13% of its ownership position in MediaMath back to MediaMath for $45.0 million. The Company also granted MediaMath an option to repurchase an additional 10.87% of the Company’s ownership position in MediaMath for $12.5 million within 180 days after the close of the initial transaction.
In July 2018, the Company sold its interest in AdvantEdge Healthcare Solutions, Inc. in a secondary transaction for $10.0 million, excluding an additional $6.3 million that may be realized upon the achievement of certain valuation thresholds in connection with the future sale of Advantage Healthcare Solutions.
In January 2018, Safeguard announced that, from that date forward, the Company will not deploy any capital into new partner company opportunities and will focus on supporting its existing partner companies and maximizing monetization opportunities for partner company interests to enable distributions of net proceeds to shareholders. In that context, the Company will consider initiatives including, among others: the sale of individual partner companies, the sale of certain partner company interests in secondary market transactions, or a combination thereof, as well as other opportunities to maximize shareholder value. The Company anticipates distributing to shareholders net proceeds from the sale of partner companies or partner company interests, as applicable, after satisfying its debt obligations and working capital needs. In connection with the Company's change in strategy, in January 2018, the Company implemented an initiative to reduce the operating costs of the Company. In April 2018, the Company announced additional management changes intended to further streamline the Company's organizational structure and further reduce its operating costs. In connection with the changes that the Company has implemented, the Company will incur approximately $3.6 million of severance payments to terminated employees that will be paid over approximately twelve months. The Company anticipates that with these organizational changes and cost reduction initiatives, its ongoing annualized operating expenses excluding interest, depreciation, severance and stock-based compensation, will approximate $8 million to $9 million.
In May 2017, the Company entered into a $75.0 million secured, revolving credit facility (“Credit Facility”) with HPS Investment Partners, LLC (“Lender”). In May 2018, the Company and Lender amended the Credit Facility ("Amended Credit Facility") to increase the principal amount of indebtedness available to be borrowed by the Company from $75.0 million to $100.0 million. The interest rate and maturity date of May 2020 remained unchanged. The Amended Credit Facility consists of a term loan in the principal amount of $85.0 million, (the “Term Loan”), $50.0 million of which was outstanding prior to entering into the amendment and $35.0 million of which was drawn in connection with the consummation of the amendment, and a revolving loan in the principal amount of up to $15.0 million (the “Revolving Loan”). The Company may borrow and repay under the Revolving Loan at any time until its expiration on December 30, 2018. Any amounts outstanding under the Revolving Loan on December 30, 2018 will be subject to the same repayment terms as amounts borrowed under the Term Loan. Repayment terms under the Amended Credit Facility include a make-whole interest provision equal to the interest that would have been payable had the principal amount subject to repayment been outstanding through the maturity date of the Amended Credit Facility. Under the Amended Credit Facility, if the aggregate amount of the Company’s cash or cash equivalents at any quarter end date exceeds $50.0 million, the Company will be required to prepay outstanding principal amounts under the Amended Credit Facility, plus any applicable accrued and make-whole interest, in an amount equal to 100% of such excess.
Certain debt covenants were revised in connection with the Amended Credit Facility. The Amended Credit Facility requires the Company to (i) maintain a liquidity threshold of at least $20 million of unrestricted cash; (ii) maintain a minimum aggregate appraised value of the Company’s ownership interests in its partner companies, plus unrestricted cash in excess of the liquidity threshold, of at least $350 million less the aggregate amount of all prepayments of the Term Loan and all prepayments of the Revolving Loan made after December 30, 2018; (iii) limit deployments to only existing partner companies and such deployments may not exceed, when combined with deployments after January 1, 2018, $40.0 million in the aggregate through the maturity date; and (iv) limit certain expenses (which shall exclude severance payments, interest expense, depreciation and stock-based compensation) incurred or paid to no more than $11.5 million in any twelve-month period after the date of the amendment (or such shorter period as has elapsed since the date of the amendment). The Company is no longer required to maintain a specific net worth or any diversification requirements or concentration limits with respect to the Company’s capital deployments to its partner companies. Additionally, under the Amended Credit Facility, the Company is restricted from repurchasing shares of its outstanding common stock and/or issuing dividends until such time as the Amended Credit Facility is repaid in full. As of the date these consolidated financial statements were issued, the Company was in compliance with all applicable covenants.
The $35.0 million of additional principal that the Company borrowed with the consummation of the Amended Credit Facility resulted in net proceeds of $32.7 million, after closing fees to the Lender and other third parties, that were used towards the repayment of $41.0 million of principal outstanding on its 2018 Debentures, which the Company repaid in full on the maturity date of May 15, 2018. There were no convertible debentures outstanding as of June 30, 2018.
The Company funds its operations with cash and marketable securities on hand as well as proceeds from the sales of its interests in its partner companies. Due to the nature of the mergers and acquisitions market, and the developmental cycle of companies like the Company's partner companies, the Company's ability to generate specific amounts of liquidity from sales of its partner company interests in any given period of time cannot be assured. Accordingly, the forecasts which the Company utilizes for projecting future compliance with covenants related to its Amended Credit Facility include significantly discounted probability-weighted proceeds from the sales of its interests in its partner companies. Based on these forecasts, management believes the Company will remain in compliance with all its debt covenants. Non-compliance with any of the covenants would constitute an event of default under the Amended Credit Facility, and the Lender could choose to accelerate the maturity of the indebtedness. If the Lender chose not to provide a waiver and were to accelerate the maturity of the indebtedness, the Company may not have sufficient liquidity to repay the entire balance of its outstanding borrowings and other obligations under the Amended Credit Facility.
In order for the Company to maintain compliance with these covenants, the Company's plan includes selling certain of its partner company interests in the ordinary course of its business and limiting capital deployments to existing partner companies, if necessary. Should the Company not be in compliance with any of its debt covenants and be unable to obtain waivers for such events of default, management would pursue one of a number of potential alternatives to satisfy the obligations, including completing an equity offering or obtaining a new debt facility to refinance its existing debt.
Significant Accounting Policies
Restricted Cash Equivalents
Restricted cash equivalents in prior periods represented cash required to be set aside by a contractual agreement with a bank as collateral for a letter of credit. During the first quarter of 2018, the restriction on the cash lapsed in connection with the termination of the related letter of credit and was classified as Cash and cash equivalents on the Consolidated Balance Sheet. The following table provides a reconciliation of cash, cash equivalents and restricted cash equivalents reported within the Consolidated Balance Sheets that sum to the total of the same such amounts shown in the Consolidated Statements of Cash Flows:
 
June 30, 2018
 
December 31, 2017
 
(Unaudited - In thousands)
Cash and cash equivalents
$
26,006

 
$
20,751

Long-term restricted cash equivalents

 
6,336

Total cash, cash equivalents and restricted cash equivalents
$
26,006

 
$
27,087


Recently Adopted Accounting Pronouncements
In January 2016, the FASB issued ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities. ASU 2016-01 requires that equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) are to be measured at fair value with changes in fair value recognized in net income. However, an entity may choose to measure equity investments that do not have readily determinable fair values at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. Furthermore, equity investments without readily determinable fair values are to be assessed for impairment using a qualitative approach. The amendments in ASU 2016-01 should be applied by means of a cumulative-effect adjustment to the balance sheet as of the beginning of the fiscal year of adoption, with other amendments related specifically to equity securities without readily determinable fair values applied prospectively. The Company adopted the amendments in ASU 2016-01 when they became effective on January 1, 2018. The adoption of this guidance did not have a material impact upon the Company's financial condition or results of operations.
In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers (Topic 606) ("ASU 2014-09"). ASU 2014-09 and related subsequent amendments outline a single comprehensive model to use to account for revenue arising from contracts with customers and supersede most current revenue recognition guidance. For public companies, the guidance is effective for annual periods beginning after December 15, 2017 and any interim periods that fall within that reporting period. For nonpublic companies, the guidance is effective for annual periods beginning after December 15, 2018 and interim periods within annual periods beginning after December 15, 2019 with early adoption permitted. As the new standard will supersede most existing revenue guidance, it could impact revenue and cost recognition for partner companies. Any change in revenue or cost recognition for partner companies could affect the Company's recognition of its share of the results of its equity method partner companies. On July 20, 2017, the SEC staff observer at the FASB’s Emerging Issues Task Force ("EITF") meeting announced that the SEC staff will not object if a private company equity method investee meeting the definition of a public business entity that otherwise would not meet the definition of a public business entity except for the inclusion of its financial statements or financial information in another entity’s filings with the SEC, uses private company adoption dates for the new revenue standard.  As a result, the Company's private, calendar year partner companies will adopt the new revenue standard for the year ending December 31, 2019.  The impact of adoption of the new revenue standard will be reflected in the Company’s financial results for the interim and annual reporting periods beginning in 2020 on a one quarter-lag basis.
Recently Issued Accounting Pronouncements Not Yet Adopted
In February 2016, the FASB issued ASU 2016-02, Leases. The guidance in ASU 2016-02 requires that a lessee recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. As with previous guidance, there continues to be a differentiation between finance leases and operating leases, however this distinction now primarily relates to differences in the manner of expense recognition over time and in the classification of lease payments in the statement of cash flows. Lease assets and liabilities arising from both finance and operating leases will be recognized in the statement of financial position. The transitional guidance for adopting the requirements of ASU 2016-02 calls for a modified retrospective approach that includes a number of optional practical expedients that entities may elect to apply. The guidance in ASU 2016-02 will become effective for the Company on January 1, 2019. The Company anticipates making the accounting policy election not to recognize lease assets and lease liabilities for leases with a term of 12 months or less. As of June 30, 2018, the Company's only material long-term lease was for its corporate headquarters in Radnor, PA under a lease expiring in 2026. The Company also has immaterial office equipment leases expiring at various dates through 2020. The Company is currently evaluating the impact that the adoption of ASU 2016-02 will have on its consolidated financial statements.
v3.10.0.1
Ownership Interests in and Advances to Partner Companies and Funds
6 Months Ended
Jun. 30, 2018
Investments in and Advances to Affiliates, Schedule of Investments [Abstract]  
Ownership Interests in and Advances to Partner Companies
Ownership Interests in and Advances to Partner Companies
The following summarizes the carrying value of the Company’s ownership interests in and advances to partner companies.   
   
June 30, 2018
 
December 31, 2017
   
(Unaudited - In thousands)
Equity Method Companies:
   
 
 
Partner companies
$
78,075

 
$
107,646

Private equity funds
441

 
443

   
78,516

 
108,089

Other Companies:
   
 
 
Partner companies and other holdings
13,568

 
2,762

Private equity funds
1,334

 
1,334

   
14,902

 
4,096

Advances to partner companies
17,014

 
22,506

   
$
110,432

 
$
134,691


In May 2018, Cask Data, Inc. sold substantially all of its assets to another entity. The Company received $11.5 million in cash proceeds in connection with the transaction, excluding $2.4 million of holdbacks and escrows that may be released on various dates on or before November 2019. The Company recognized a gain of $4.2 million on the transaction, which was included in Equity income (loss) in the Consolidated Statements of Operations for the three and six months ended June 30, 2018.
The Company recognized an impairment charge of $6.6 million related to Apprenda, Inc. which is reflected in Equity income (loss) in the Consolidated Statements of Operations for the three and six months ended June 30, 2018. The impairment was based on Apprenda's decision to discontinue operations. The adjusted carrying value of the Company's interest in Apprenda was $0.0 million at June 30, 2018.
In February 2018, Nexxt, Inc., formerly Beyond.com, repaid $10.5 million of principal outstanding on a note received in connection with the Company's sale of its interest back to Nexxt for $26.0 million in March 2017. In that transaction, the Company received $15.5 million in cash and a three-year, $10.5 million note for the balance due, which accrued interest at a rate of 9.5% per annum. Interest was payable annually and interest income was recorded as earned throughout the year. The $10.5 million note was fully reserved and had a carrying value of zero as of December 31, 2017. The Company waived the interest accrued to date in connection with the early repayment of the principal balance. The receipt of $10.5 million of cash in February 2018 resulted in a gain of $9.5 million, net of the interest accrued to date, which is included in Equity income (loss) in the Consolidated Statements of Operations for the six months ended June 30, 2018.
In January 2018, Spongecell, Inc. merged into Flashtalking, a privately-held company. The Company received Flashtalking ordinary shares equal to approximately 10% of Flashtalking’s issued share capital at the time of the closing. The Company’s final number of Flashtalking shares will be subject to customary indemnification and working capital provisions and agreements. The Company recorded its ownership interest in Flashtalking at $11.2 million, which reflects its fair value at the time of closing. The Company recognized a gain of $4.0 million on the transaction, which is included in Equity income (loss) in the Consolidated Statements of Operations for the six months ended June 30, 2018.
In February 2018, the Company sold 414,237 shares of Invitae Corporation ("Invitae") common stock on the open market for proceeds of $2.6 million after transaction fees. The Company obtained shares of Invitae in August 2017 when Invitae, a public company, acquired former partner company Good Start Genetics, Inc. In that transaction, the Company received 414,237 shares of Invitae common stock, excluding 124,092 shares of Invitae common stock which will be held in escrow until August 2018. The Invitae shares were classified as Trading securities and recorded at their fair value, which was $3.8 million at December 31, 2017. During the first quarter of 2018, the Company recorded a $1.2 million loss due to a decline in the value of the Invitae shares, which is included in Other income (loss) in the Consolidated Statements of Operations for the six months ended June 30, 2018.
In January 2018, the Company received $0.6 million of proceeds from the sale of the assets of Aventura, Inc., a former partner company that ceased operations and was fully impaired in 2016. The Company recognized a gain of $0.6 million, which is reflected in Equity income (loss) in the Consolidated Statements of Operations for the six months ended June 30, 2018.
v3.10.0.1
Acquisitions of Ownership Interests in Partner Companies and Funds
6 Months Ended
Jun. 30, 2018
Equity Method Investments and Joint Ventures [Abstract]  
Acquisitions of Ownership Interests in Partner Companies
Acquisitions of Ownership Interests in Partner Companies
Second quarter of 2018
The Company funded an aggregate of $1.5 million of a convertible bridge loan to Sonobi, Inc. The Company had previously deployed $9.4 million in Sonobi. Sonobi is an advertising technology developer that designs advertising tools and solutions for the industry's leading media, publishers, brand advertisers, media agencies, DSPs, and media technology providers. The Company accounts for its interest in Sonobi under the equity method.
The Company funded an aggregate of $0.8 million of convertible bridge loans to InfoBionic, Inc. The Company had previously deployed an aggregate of $20.5 million in InfoBionic. InfoBionic is an emerging digital health company focused on creating patient monitoring solutions for chronic disease management with an initial market focus on cardiac arrhythmias. The Company accounts for its interest in InfoBionic under the equity method.
The Company deployed an aggregate of $0.5 million of convertible bridge loans to CloudMine, Inc. The Company had previously deployed an aggregate of $10.0 million in CloudMine. CloudMine is a leading HIPAA-compliance Enterprise Health Cloud platform. CloudMine empowers healthcare organizations to rapidly and confidently develop connected digital health experiences by reducing complexity, enabling data mobility, and ensuring compliance. The Company accounts for its interest in CloudMine under the equity method.
The Company funded an aggregate of $0.2 million of convertible bridge loans to WebLinc, Inc. The Company had previously deployed an aggregate of $14.5 million in WebLinc. WebLinc is a commerce platform and services provider for fast growing online retailers. The Company accounts for its interest in WebLinc under the equity method.
The Company deployed an additional $0.3 million in Propeller Health, Inc. The Company had previously deployed an aggregate of $14.0 million in Propeller Health. Propeller Health provides digital solutions to measurably improve respiratory health. The Company accounts for its interest in Propeller Health under the equity method.
The Company funded an aggregate of $0.2 million of convertible bridge loans to Cask Data, Inc. The Company had previously deployed an aggregate of $13.3 million in Cask Data. Cask Data made building and running big data solutions on-premises or in the cloud easy with Cask Data Application Platform. In May 2018, Cask Data sold substantially all of its assets to another entity. The Company had previously accounted for its interest in Cask Data under the equity method.
The Company funded an aggregate of $0.8 million of convertible loans to NovaSom, Inc. The Company had previously deployed an aggregate of $25.4 million in NovaSom. NovaSom is a medical device company focused on obstructive sleep apnea, specifically home testing with its FDA-cleared wireless device called AccuSom® home sleep test. The Company accounts for its interest in NovaSom under the equity method.
First quarter of 2018
The Company funded an aggregate of $1.3 million of convertible loans to NovaSom, Inc.
The Company funded an aggregate of $0.8 million of convertible bridge loans to InfoBionic, Inc.
The Company funded an aggregate of $0.5 million of convertible bridge loans to Spongecell, Inc. The Company had previously deployed an aggregate of $18.6 million in Spongecell. In the first quarter of 2018, Spongecell merged into Flashtalking. The Company previously accounted for its interest in Spongecell under the equity method.
The Company funded an aggregate of $0.5 million of convertible bridge loans to WebLinc, Inc.
The Company funded an aggregate of $0.4 million of convertible bridge loans to Brickwork. The Company had previously deployed an aggregate of $4.2 million in Brickwork. Brickwork helps retailers inform, target, convert, and prepare for store shoppers online as the first scalable software-as-a-service platform powering a seamless customer path between online and in-store shopping. The Company accounts for its interest in Brickwork under the equity method.
The Company funded an aggregate of $0.3 million of convertible bridge loans to Cask Data, Inc.
The Company funded an aggregate of $0.2 million of a convertible bridge loan to Sonobi, Inc.
v3.10.0.1
Fair Value Measurements
6 Months Ended
Jun. 30, 2018
Fair Value Disclosures [Abstract]  
Fair Value Measurements
Fair Value Measurements
The Company categorizes its financial instruments into a three-level fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used to measure fair value fall within different levels of the hierarchy, the category level is based on the lowest priority level input that is significant to the fair value measurement of the instrument. Financial instruments recorded at fair value on the Company’s Consolidated Balance Sheets are categorized as follows:
Level 1—Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.
Level 2—Include other inputs that are directly or indirectly observable in the marketplace.
Level 3—Unobservable inputs which are supported by little or no market activity.
The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.
The following table provides the carrying value and fair value of certain financial assets and liabilities of the Company measured at fair value on a recurring basis as of June 30, 2018 and December 31, 2017:
   
Carrying
Value
 
Fair Value Measurement at June 30, 2018
   
Level 1
 
Level 2
 
Level 3
 
(Unaudited - In thousands)
Cash and cash equivalents
$
26,006

 
$
26,006

 
$

 
$

Marketable securities—held-to-maturity:
   

 
   

 
   

 
   

Certificates of deposit
688

 
688

 

 

 
 
 
 
 
 
 
 
Credit facility repayment feature liability
$
2,979

 
$

 
$

 
$
2,979

 
Carrying
Value
 
Fair Value Measurement at December 31, 2017
   
Level 1
 
Level 2
 
Level 3
 
(Unaudited - In thousands)
Cash and cash equivalents
$
20,751

 
$
20,751

 
$

 
$

Long-term restricted cash equivalents
6,336

 
6,336

 

 

Trading securities
3,761

 
3,761

 

 

Marketable securities—held-to-maturity:
   
 
 
 
 
 
 
Certificates of deposit
$
4,452

 
$
4,452

 
$

 
$


As of June 30, 2018, $0.7 million of marketable securities had contractual maturities which were less than one year. Certificates of deposit are classified as held-to-maturity securities carried at amortized cost, which, due to the short-term maturity of these instruments, approximates fair value using quoted prices in active markets for identical assets or liabilities defined as Level 1 inputs under the fair value hierarchy. As of June 30, 2018, $3.0 million is recorded as a credit facility repayment feature liability due to the provision in the Amended Credit Facility that requires prepayments of outstanding principal amounts when the Company’s cash and cash equivalents at any quarter end date exceeds $50.0 million. The prepayment feature is an embedded derivative that is accounted for as a liability separate from the Amended Credit Facility. The liability is adjusted to the fair value of potential future debt prepayments based upon management's probability weighted cash forecast at each balance sheet date. Management's cash forecasts are defined as Level 3 inputs under the fair value hierarchy.
Trading securities at December 31, 2017 consisted of 414,237 shares of Invitae Corporation common shares obtained in connection with the sale of Good Start Genetics. The trading securities were carried at fair value based on the closing stock price on the last trading day of the reporting period. The Company sold all of the Invitae shares during the first quarter of 2018 for $2.6 million of cash proceeds.
v3.10.0.1
Credit Facility and Convertible Debentures
6 Months Ended
Jun. 30, 2018
Debt Disclosure [Abstract]  
Credit Facility and Convertible Debentures
Convertible Debentures
Credit Facility
In May 2017, the Company entered into a $75.0 million secured, revolving credit facility (“Credit Facility”) with HPS Investment Partners, LLC (“Lender”). At closing, the Company borrowed $50.0 million, which resulted in net proceeds of $44.3 million after closing fees to the Lender and other third parties. The Credit Facility has a three-year term with a scheduled maturity of May 11, 2020 and bears interest at a rate of either: (A) LIBOR plus 8.5% (subject to a LIBOR floor of 1%), payable on the last day of the one, two or three month interest period applicable to the LIBOR rate advance, or (B) 7.5% plus the greater of: 2%; the Federal Funds Rate plus 0.5%; LIBOR plus 1%; or the U.S. Prime Rate, payable monthly in arrears. The Credit Facility is not amortized and interest payable under the Credit Facility reflects at least $50 million as being drawn and outstanding at all times during the term. The Credit Facility also included an unused line fee equal to 0.75% per annum of the average unused portion of the Credit Facility and a loan service fee, both paid quarterly. The Credit Facility is secured by all of the Company's assets in accordance with the terms of the Credit Facility.
In May 2018, the Company and Lender amended the Credit Facility ("Amended Credit Facility") to increase the principal amount of indebtedness available to be borrowed by the Company from $75.0 million to $100.0 million. The maturity date and interest rate remained unchanged. The Amended Credit Facility consists of a term loan in the principal amount of $85.0 million, (the “Term Loan”), $50.0 million of which was outstanding prior to entering into the amendment and $35.0 million of which was drawn in connection with the consummation of the amendment, and a revolving loan in the principal amount of up to $15.0 million (the “Revolving Loan”). The Company may borrow and repay under the Revolving Loan at any time until its expiration on December 30, 2018. Any amounts outstanding under the Revolving Loan on December 30, 2018 will be subject to the same repayment terms as amounts borrowed under the Term Loan. Repayment terms under the Credit Facility include a make-whole interest provision equal to the interest that would have been payable had the principal amount subject to repayment been outstanding through the maturity date of the Credit Facility. Under the Amended Credit Facility, if the aggregate amount of the Company’s cash or cash equivalents at any quarter end date exceeds $50.0 million, the Company will be required to prepay outstanding principal amounts under the Amended Credit Facility, plus any applicable interest and prepayment fees, in an amount equal to 100% of such excess.
Certain debt covenants were revised in connection with the Amended Credit Facility. The Amended Credit Facility requires the Company to (i) maintain a liquidity threshold of at least $20 million of unrestricted cash; (ii) maintain a minimum aggregate appraised value of the Company’s ownership interests in its partner companies, plus unrestricted cash in excess of the liquidity threshold, of at least $350 million less the aggregate amount of all prepayments of the Term Loan and all prepayments of the Revolving Loan made after December 30, 2018; (iii) limit deployments to only existing partner companies and such deployments may not exceed, when combined with deployments after January 1, 2018, $40.0 million in the aggregate through the maturity date; and (iv) limit certain expenses (which shall exclude severance payments, interest expense, depreciation and stock-based compensation) incurred or paid to no more than $11.5 million in any twelve-month period after the date of the amendment (or such shorter period as has elapsed since the date of the amendment). The Company is no longer required to maintain a specific net worth or any diversification requirements or concentration limits with respect to the Company’s capital deployments to its partner companies. Additionally, under the Amended Credit Facility, the Company is restricted from repurchasing shares of its outstanding common stock and/or issuing dividends until such time as the Amended Credit Facility is repaid in full. As of the date these consolidated financial statements were issued, the Company was in compliance with all applicable covenants.
The $35.0 million of additional principal that the Company borrowed with the consummation of the Amended Credit Facility resulted in net proceeds of $32.7 million, after closing fees to the Lender and other third parties, that were used towards the repayment of $41.0 million of principal outstanding on its 2018 Debentures, which the Company repaid in full on the maturity date of May 15, 2018. There were no convertible debentures outstanding as of June 30, 2018.
The Amended Credit Facility provides for customary events of default which include (subject in certain cases to customary grace and cure periods), among others, nonpayment of principal or interest; non-compliance with debt covenants; defaults in, or failure to pay, certain other indebtedness; the rendering of judgments to pay certain amounts of money; and certain events of bankruptcy or insolvency. Generally, if an event of default occurs and is not cured within the time periods specified (if any), the Lender may declare the outstanding amount under the Amended Credit Facility to be immediately due and payable.
At June 30, 2018, the principal amount outstanding under the Amended Credit Facility was $85.0 million, the unamortized discount and debt issuance costs were $6.0 million and the net carrying value of the credit facility was $79.0 million. The Company accounted for the amendment to the Credit Facility as an insubstantial modification and is amortizing the excess of the principal amount of the Amended Credit Facility over its carrying value over the remaining term as additional interest expense using a revised effective interest rate prospectively based on the revised cash flows. The Amended Credit Facility requires prepayments of outstanding principal amounts when the Company’s cash and cash equivalents at any quarter end date exceeds $50.0 million. This provision in the Amended Credit Facility is an embedded derivative that is accounted for separately from the credit facility. A liability of $0.5 million was recorded on the amendment date for the fair value of potential future prepayments based upon management's probability weighted cash forecast. This amount is also included in debt issuance costs and will be amortized over the remaining term of the credit facility. The liability will be adjusted to fair value at each balance sheet date based upon management's updated probability weighted cash forecast. During the second quarter of 2018, the Company recorded a $2.5 million loss, which is included in Other income (loss) on the Consolidated Statements of Operations. This loss related to an increase in the fair value of the credit facility repayment feature liability due to an increase in the probability of debt prepayments caused by $55.0 million of proceeds received in July 2018 in connection with the MediaMath and AdvantEdge Healthcare Solutions transactions. The Company recorded interest expense of $2.9 million and $0.9 million for the three months ended June 30, 2018 and 2017, respectively, and $4.7 million and $0.9 million for the six months ended June 30, 2018 and 2017, respectively, under the Amended Credit Facility. The effective interest rate on the Amended Credit Facility is 14.9%. The Company made interest payments of $1.3 million and $2.6 million for the three and six months ended June 30, 2018, respectively. The Company did not make interest payments during the three and six months ended June 30, 2017.
Convertible Debentures
In November 2012, the Company issued $55.0 million principal amount of its 5.25% convertible senior debentures due on May 15, 2018 (the “2018 Debentures”). Interest on the 2018 Debentures was payable semi-annually. In July and June 2017, the Company repurchased on the open market, and retired, an aggregate of $14.0 million face value of the 2018 Debentures at a cost of $14.5 million, including transaction fees. The Company repaid the remaining $41.0 million of principal outstanding on its 2018 Debentures in full on the maturity date of May 15, 2018. The Company had no convertible debentures outstanding as of June 30, 2018. The Company had been amortizing the excess of the face value of the 2018 Debentures over their carrying value over their term as additional interest expense using the effective interest method and the Company recorded $0.4 million and $1.2 million of interest expense for the three months ended June 30, 2018 and 2017, respectively, and $1.3 million and $2.3 million for the six months ended June 30, 2018 and 2017, respectively. The effective interest rate on the 2018 Debentures was 8.7%. The Company made interest payments of $1.1 million and $1.5 million for the three months ended June 30, 2018 and 2017, respectively, and $1.1 million and $1.5 million for the six months ended June 30, 2018 and 2017, respectively.
v3.10.0.1
Stock-Based Compensation
6 Months Ended
Jun. 30, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Stock-Based Compensation
Stock-Based Compensation
Stock-based compensation expense was recognized in the Consolidated Statements of Operations as follows:   
   
Three months ended June 30,
 
Six months ended June 30,
   
2018
 
2017
 
2018
 
2017
 
(Unaudited - In thousands)
General and administrative expense
$
332

 
$
351

 
$
610

 
$
246

   
$
332

 
$
351

 
$
610

 
$
246


The fair value of the Company’s option awards to employees was estimated at the date of grant using the Black-Scholes option-pricing model. The risk-free rate was based on the U.S. Treasury yield curve in effect at the end of the quarter in which the grant occurred. The expected term of stock options granted was estimated using the historical exercise behavior of employees. Expected volatility was based on historical volatility measured using weekly price observations of the Company’s common stock for a period equal to the stock option’s expected term.
v3.10.0.1
Income Taxes
6 Months Ended
Jun. 30, 2018
Income Tax Disclosure [Abstract]  
Income Taxes
Income Taxes
The Company’s consolidated income tax benefit (expense) was $0.0 million for the three and six months ended June 30, 2018 and 2017. The Company has recorded a valuation allowance to reduce its net deferred tax asset to an amount that is more likely than not to be realized in future years. Accordingly, the benefit of the net operating loss that would have been recognized in the three and six months ended June 30, 2018 was offset by changes in the valuation allowance. The tax expense that would have been recognized in the three and six months ended June 30, 2018 was offset by changes in the valuation allowance. During the three and six months ended June 30, 2018, the Company had no material changes in uncertain tax positions.
In December 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the "Tax Act"). The Tax Act makes broad and complex changes to the U.S. tax code, including, but not limited to: (i) reducing the U.S. federal corporate tax rate from 35 percent to 21 percent; (ii) eliminating the corporate alternative minimum tax (AMT) and changing how existing AMT credits can be realized; (iii) creating a new limitation on deductible interest expense; and (iv) changing rules related to uses and limitations of net operating carryforwards created in tax years beginning after December 31, 2017. The most significant impact on the Company's consolidated financial statements was a reduction of approximately $82.5 million in deferred tax assets in 2017 which was offset by changes to the Company’s valuation allowance.
v3.10.0.1
Net Income (Loss) Per Share
6 Months Ended
Jun. 30, 2018
Earnings Per Share [Abstract]  
Net Income (Loss) Per Share
Net Loss Per Share
The calculations of net loss per share were as follows:
   
Three months ended June 30,
 
Six months ended June 30,
   
2018
 
2017
 
2018
 
2017
 
(Unaudited - In thousands, except per share data)
Basic:
   
 
   
 
   
 
   
Net loss
$
(24,896
)
 
$
(29,097
)
 
$
(31,066
)
 
$
(51,194
)
Weighted average common shares outstanding
20,539

 
20,411

 
20,523

 
20,395

Net loss per share
$
(1.21
)
 
$
(1.43
)
 
$
(1.51
)
 
$
(2.51
)
 
 
 
 
 
 
 
 
Diluted:
 
 
 
 
 
 
 
Net loss
$
(24,896
)
 
$
(29,097
)
 
$
(31,066
)
 
$
(51,194
)
Weighted average common shares outstanding
20,539

 
20,411

 
20,523

 
20,395

Net loss for dilutive share computation
$
(1.21
)
 
$
(1.43
)
 
$
(1.51
)
 
$
(2.51
)
 
 
 
 
 
 
 
 

Basic and diluted average common shares outstanding for purposes of computing net income (loss) per share includes outstanding common shares and vested deferred stock units (DSUs).
If a consolidated or equity method partner company has dilutive stock options, unvested restricted stock, DSUs or warrants, diluted net income (loss) per share is computed by first deducting the income attributable to the potential exercise of the dilutive securities of the partner company from net income (loss). Any impact is shown as an adjustment to net income (loss) for purposes of calculating diluted net income (loss) per share.
Diluted earnings per share for the three and six months ended June 30, 2018 and 2017 do not reflect the following potential shares of common stock that would have an anti-dilutive effect or have unsatisfied performance or market conditions:
At June 30, 2018 and 2017, options to purchase 0.5 million and 0.7 million shares of common stock, respectively, at prices ranging from $9.83 to $19.95 for both periods, were excluded from the calculations.
At June 30, 2018 and 2017, unvested restricted stock, performance-based stock units and DSUs convertible into 0.8 million and 0.9 million shares of stock, respectively, were excluded from the calculations.
2.3 million and 2.4 million shares of common stock that were outstanding during the period of 2018 and 2017, respectively, representing the effect of the assumed conversion of the 2018 Debentures, were excluded from the calculations.
v3.10.0.1
Segment Reporting
6 Months Ended
Jun. 30, 2018
Segment Reporting [Abstract]  
Segment Reporting
Segment Reporting
The Company operates as one operating segment based upon the similar nature of its technology-driven partner companies, the functional alignment of the organizational structure, and the reports that are regularly reviewed by the chief operating decision maker for the purpose of assessing performance and allocating resources. As of June 30, 2018, the Company held interests in 23 non-consolidated partner companies. The Company’s active partner companies were as follows as of June 30, 2018:
Partner Company
Safeguard Primary Ownership as of June 30, 2018
 
Accounting Method
AdvantEdge Healthcare Solutions, Inc. 1
40.1%
 
Equity
Aktana, Inc.
24.5%
 
Equity
Brickwork
20.3%
 
Equity
CloudMine, Inc.
47.3%
 
Equity
Clutch Holdings, Inc.
41.2%
 
Equity
Flashtalking 2
10.3%
 
Other
Hoopla Software, Inc.
25.5%
 
Equity
InfoBionic, Inc.
39.5%
 
Equity
Lumesis, Inc.
43.8%
 
Equity
MediaMath, Inc. 3
20.5%
 
Equity
meQuilibrium
36.2%
 
Equity
Moxe Health Corporation
32.4%
 
Equity
NovaSom, Inc.
31.7%
 
Equity
Prognos (fka Medivo, Inc.)
28.7%
 
Equity
Propeller Health, Inc.
19.6%
 
Equity
QuanticMind, Inc.
24.7%
 
Equity
Sonobi, Inc.
21.6%
 
Equity
Syapse, Inc.
20.0%
 
Equity
T-REX Group, Inc.
21.1%
 
Equity
Transactis, Inc.
23.8%
 
Equity
Trice Medical, Inc.
24.8%
 
Equity
WebLinc, Inc.
38.0%
 
Equity
Zipnosis, Inc.
25.4%
 
Equity

1 The Company sold its ownership interest in AdvantEdge Healthcare Solutions, Inc. for $10.0 million of initial proceeds in July 2018.
2 Spongecell, Inc. merged into Flashtalking in January 2018.
3 The Company sold 39.1% of its ownership interest in MediaMath, Inc. back to the company for $45.0 million of proceeds in July 2018.
As of June 30, 2018 and December 31, 2017, all of the Company’s assets were located in the United States.
v3.10.0.1
Commitments and Contingencies
6 Months Ended
Jun. 30, 2018
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies
Commitments and Contingencies
The Company and its partner companies are involved in various claims and legal actions arising in the ordinary course of business. In the current opinion of the Company, the ultimate disposition of these matters will not have a material adverse effect on the Company’s consolidated financial position or results of operations, however, no assurance can be given as to the outcome of these actions, and one or more adverse rulings could have a material adverse effect on the Company’s consolidated financial position and results of operations or that of its partner companies. The Company records costs associated with legal fees as such services are rendered.
The Company had outstanding guarantees of $3.8 million at June 30, 2018 which related to one of the Company's private equity holdings.
The Company is required to return a portion or all the distributions it received as a general partner of a private equity fund for further distribution to such fund's limited partners (“clawback”). The Company’s ownership in the fund is 19%. The clawback liability is joint and several, such that the Company may be required to fund the clawback for other general partners should they default. The Company believes its potential liability due to the possibility of default by other general partners is remote. In 2017, the Company was notified by the fund's manager that the fund was being dissolved and $1.0 million of the Company's clawback liability was paid. The maximum additional clawback liability is $0.3 million which was reflected in Other long-term liabilities on the Consolidated Balance Sheet at June 30, 2018.
 
In October 2001, the Company entered into an agreement with a former Chairman and Chief Executive Officer of the Company, to provide for annual payments of $0.65 million per year and certain health care and other benefits for life. The related current liability of $0.8 million was included in Accrued expenses and other current liabilities and the long-term portion of $1.5 million was included in Other long-term liabilities on the Consolidated Balance Sheet at June 30, 2018.
The Company previously provided a $6.3 million letter of credit to the landlord of CompuCom Systems, Inc.’s Dallas headquarters as required in connection with the sale of CompuCom Systems in 2004. The letter of credit was secured by cash and was classified as Long-term restricted cash equivalents on the Consolidated Balance Sheet as of December 31, 2017. During the first quarter of 2018, the restriction on the cash lapsed in connection with the termination of the related letter of credit and is classified as Cash and cash equivalents on the Consolidated Balance Sheet as of June 30, 2018.
In January 2018, the Company announced a change in strategy and implemented an initiative to reduce the operating costs of the Company. In April 2018, the Company announced additional management changes intended to further streamline the Company's organizational structure and further reduce its operating costs. In connection with the changes that the Company has implemented, the Company will incur approximately $3.6 million of severance payments to terminated employees that will be paid over approximately twelve months and is being expensed over the remaining requisite service period. The Company recognized $1.7 million and $2.8 million of severance expense for the three and six months ended June 30, 2018, respectively, which is included in General and Administrative expenses in the Consolidated Statement of Operations. The Company made severance payments of $0.3 million and $0.5 million for the three and six months ended June 30, 2018, respectively, and $2.3 million was classified as accrued compensation and benefits on the Consolidated Balance Sheet as of June 30, 2018.
The Company has agreements with certain remaining employees that provide for severance payments to the employee in the event the employee is terminated without cause or an employee terminates his employment for “good reason.” The maximum aggregate exposure under employment and severance agreements for remaining employees was approximately $6.5 million at June 30, 2018. In addition, in April 2018, the Board of Directors (the “Board”) of the Company adopted a long-term incentive plan, the Safeguard Scientifics Transaction Bonus Plan, (the “LTIP”). The purpose of the LTIP is to promote the interests of the Company and its shareholders by providing an additional incentive to employees to maximize the value of the Company in connection with the execution of the business strategy that the Company adopted and announced in January 2018. Under the LTIP, participants may receive awards in connection with sales of the Company’s partner company assets (“Sale Transaction(s)”). At the Board’s sole discretion following a sale of partner company assets, the Company may, but has no obligation to, provide a bonus pool under the LTIP based on a range of transaction consideration and subject to a minimum amount of transaction consideration. All current officers and employees of the Company are eligible to participate in the LTIP. The Board, in its sole discretion, will determine the participants to whom awards are granted under the LTIP, and the amounts of the awards relating to the bonus pool, if any. The Board has no obligation to grant any awards under the LTIP, even if transaction consideration exceeds the established minimum amount under the plan. There are no amounts payable under the LTIP as of June 30, 2018.
In June 2011, the Company's former partner company, Advanced BioHealing, Inc. (“ABH”) was acquired by Shire plc (“Shire”).  Prior to the expiration of the escrow period in March 2012, Shire filed a claim against all amounts held in escrow related to the sale based principally upon a United States Department of Justice (“DOJ”) false claims act investigation relating to ABH (the “Investigation”). In connection with the Investigation, in July 2015 the Company received a Civil Investigation Demand-Documentary Material (“CID”) from the DOJ regarding ABH and Safeguard’s relationship with ABH. Pursuant to the CID, the Company provided the requested materials and information.  To the Company’s knowledge, the CID was related to multiple qui tam (“whistleblower”) actions, one of which was filed in 2014 by an ex-employee of ABH that named the Company and one of the Company’s employees along with other entities and individuals as defendants.  At this time, the DOJ has declined to pursue the qui tam action as it relates to the Company and such Company employee. In addition, in connection with the above matters, the Company and other former equity holders in ABH entered into a settlement and release with Shire, which resulted in the release to Shire of all amounts held in escrow related to the sale of ABH.
v3.10.0.1
Equity
6 Months Ended
Jun. 30, 2018
Equity [Abstract]  
Equity
Equity
In July 2015, the Company's Board of Directors authorized the Company, from time to time and depending on market conditions, to repurchase up to $25.0 million of the Company's outstanding common stock. During 2016, the Company repurchased 0.4 million shares at an aggregate cost of $5.4 million with $14.6 million remaining for repurchase under the existing authorization. Under the Amended Credit Facility, we are restricted from repurchasing shares of our outstanding common stock and/or issuing dividends until such time as the Amended Credit Facility is repaid in full.
In February 2018, the Company's Board of Directors adopted a tax benefits preservation plan (the "Plan") designed to protect and preserve the Company's ability to utilize its net operating loss carryforwards ("NOLs"). The Company submitted the Plan for shareholder ratification at its 2018 Annual Meeting of Shareholders and the Plan was ratified by shareholders. The purpose of the Plan is to preserve the Company's ability to use its NOLs, which would be substantially limited if the Company experienced an "ownership change" as defined under Section 382 of the Internal Revenue Code. In general, an ownership change would be deemed to have occurred if the Company's shareholders who are treated as owning five percent or more of the outstanding shares of Safeguard for purposes of Section 382 ("five-percent shareholders") collectively increase their aggregate ownership in the Company's overall shares outstanding by more than 50 percentage points. Whether this change has occurred would be measured by comparing each five-percent shareholder's current ownership as of the measurement date to such shareholders' lowest ownership percentage during the three-year period preceding the measurement date. To protect the Company's NOLs from being limited or permanently lost under Section 382, the Plan is intended to deter any person or group from acquiring beneficial ownership of 4.99% or more of the Company's outstanding common stock without the approval of the Board, reducing the likelihood of an unintended ownership change. Under the Plan, the Company will issue one preferred stock purchase right (the "Rights") for each share of Safeguard's common stock held by shareholders of record on March 2, 2018. The issuance of the Rights will not be taxable to Safeguard or its shareholders and will not affect Safeguard's reported earnings per share. The Rights will trade with Safeguard's common shares and will expire no later than February 19, 2021. The Rights and the Plan may also expire on an earlier date upon the occurrence of other events, including a determination by the Company's Board that the Plan is no longer necessary or desirable for the preservation of the Company's tax attributes or that no tax attributes may be carried forward (with such expiration occurring as of the beginning of the applicable taxable year). There can be no assurance that the Plan will prevent the Company from experiencing an ownership change.
v3.10.0.1
General General (Policies)
6 Months Ended
Jun. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Restricted Cash Equivalents
Restricted Cash Equivalents
Restricted cash equivalents in prior periods represented cash required to be set aside by a contractual agreement with a bank as collateral for a letter of credit. During the first quarter of 2018, the restriction on the cash lapsed in connection with the termination of the related letter of credit and was classified as Cash and cash equivalents on the Consolidated Balance Sheet.
Recent Accounting Pronouncements
Recently Adopted Accounting Pronouncements
In January 2016, the FASB issued ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities. ASU 2016-01 requires that equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) are to be measured at fair value with changes in fair value recognized in net income. However, an entity may choose to measure equity investments that do not have readily determinable fair values at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. Furthermore, equity investments without readily determinable fair values are to be assessed for impairment using a qualitative approach. The amendments in ASU 2016-01 should be applied by means of a cumulative-effect adjustment to the balance sheet as of the beginning of the fiscal year of adoption, with other amendments related specifically to equity securities without readily determinable fair values applied prospectively. The Company adopted the amendments in ASU 2016-01 when they became effective on January 1, 2018. The adoption of this guidance did not have a material impact upon the Company's financial condition or results of operations.
In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers (Topic 606) ("ASU 2014-09"). ASU 2014-09 and related subsequent amendments outline a single comprehensive model to use to account for revenue arising from contracts with customers and supersede most current revenue recognition guidance. For public companies, the guidance is effective for annual periods beginning after December 15, 2017 and any interim periods that fall within that reporting period. For nonpublic companies, the guidance is effective for annual periods beginning after December 15, 2018 and interim periods within annual periods beginning after December 15, 2019 with early adoption permitted. As the new standard will supersede most existing revenue guidance, it could impact revenue and cost recognition for partner companies. Any change in revenue or cost recognition for partner companies could affect the Company's recognition of its share of the results of its equity method partner companies. On July 20, 2017, the SEC staff observer at the FASB’s Emerging Issues Task Force ("EITF") meeting announced that the SEC staff will not object if a private company equity method investee meeting the definition of a public business entity that otherwise would not meet the definition of a public business entity except for the inclusion of its financial statements or financial information in another entity’s filings with the SEC, uses private company adoption dates for the new revenue standard.  As a result, the Company's private, calendar year partner companies will adopt the new revenue standard for the year ending December 31, 2019.  The impact of adoption of the new revenue standard will be reflected in the Company’s financial results for the interim and annual reporting periods beginning in 2020 on a one quarter-lag basis.
Recently Issued Accounting Pronouncements Not Yet Adopted
In February 2016, the FASB issued ASU 2016-02, Leases. The guidance in ASU 2016-02 requires that a lessee recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. As with previous guidance, there continues to be a differentiation between finance leases and operating leases, however this distinction now primarily relates to differences in the manner of expense recognition over time and in the classification of lease payments in the statement of cash flows. Lease assets and liabilities arising from both finance and operating leases will be recognized in the statement of financial position. The transitional guidance for adopting the requirements of ASU 2016-02 calls for a modified retrospective approach that includes a number of optional practical expedients that entities may elect to apply. The guidance in ASU 2016-02 will become effective for the Company on January 1, 2019. The Company anticipates making the accounting policy election not to recognize lease assets and lease liabilities for leases with a term of 12 months or less. As of June 30, 2018, the Company's only material long-term lease was for its corporate headquarters in Radnor, PA under a lease expiring in 2026. The Company also has immaterial office equipment leases expiring at various dates through 2020. The Company is currently evaluating the impact that the adoption of ASU 2016-02 will have on its consolidated financial statements.
v3.10.0.1
General General (Tables)
6 Months Ended
Jun. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Schedule of Cash and Cash Equivalents
The following table provides a reconciliation of cash, cash equivalents and restricted cash equivalents reported within the Consolidated Balance Sheets that sum to the total of the same such amounts shown in the Consolidated Statements of Cash Flows:
 
June 30, 2018
 
December 31, 2017
 
(Unaudited - In thousands)
Cash and cash equivalents
$
26,006

 
$
20,751

Long-term restricted cash equivalents

 
6,336

Total cash, cash equivalents and restricted cash equivalents
$
26,006

 
$
27,087

v3.10.0.1
Ownership Interests in and Advances to Partner Companies and Funds (Tables)
6 Months Ended
Jun. 30, 2018
Investments in and Advances to Affiliates, Schedule of Investments [Abstract]  
Ownership Interests in and Advances to Partner Companies and Private Equity Funds
The following summarizes the carrying value of the Company’s ownership interests in and advances to partner companies.   
   
June 30, 2018
 
December 31, 2017
   
(Unaudited - In thousands)
Equity Method Companies:
   
 
 
Partner companies
$
78,075

 
$
107,646

Private equity funds
441

 
443

   
78,516

 
108,089

Other Companies:
   
 
 
Partner companies and other holdings
13,568

 
2,762

Private equity funds
1,334

 
1,334

   
14,902

 
4,096

Advances to partner companies
17,014

 
22,506

   
$
110,432

 
$
134,691

v3.10.0.1
Fair Value Measurements (Tables)
6 Months Ended
Jun. 30, 2018
Fair Value Disclosures [Abstract]  
Carrying Value and Fair Value of Certain Financial Assets and Liabilities Measured at Fair Value on Recurring Basis
The following table provides the carrying value and fair value of certain financial assets and liabilities of the Company measured at fair value on a recurring basis as of June 30, 2018 and December 31, 2017:
   
Carrying
Value
 
Fair Value Measurement at June 30, 2018
   
Level 1
 
Level 2
 
Level 3
 
(Unaudited - In thousands)
Cash and cash equivalents
$
26,006

 
$
26,006

 
$

 
$

Marketable securities—held-to-maturity:
   

 
   

 
   

 
   

Certificates of deposit
688

 
688

 

 

 
 
 
 
 
 
 
 
Credit facility repayment feature liability
$
2,979

 
$

 
$

 
$
2,979

 
Carrying
Value
 
Fair Value Measurement at December 31, 2017
   
Level 1
 
Level 2
 
Level 3
 
(Unaudited - In thousands)
Cash and cash equivalents
$
20,751

 
$
20,751

 
$

 
$

Long-term restricted cash equivalents
6,336

 
6,336

 

 

Trading securities
3,761

 
3,761

 

 

Marketable securities—held-to-maturity:
   
 
 
 
 
 
 
Certificates of deposit
$
4,452

 
$
4,452

 
$

 
$

v3.10.0.1
Stock-Based Compensation (Tables)
6 Months Ended
Jun. 30, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Stock-Based Compensation Expense
Stock-based compensation expense was recognized in the Consolidated Statements of Operations as follows:   
   
Three months ended June 30,
 
Six months ended June 30,
   
2018
 
2017
 
2018
 
2017
 
(Unaudited - In thousands)
General and administrative expense
$
332

 
$
351

 
$
610

 
$
246

   
$
332

 
$
351

 
$
610

 
$
246

v3.10.0.1
Net Income (Loss) Per Share (Tables)
6 Months Ended
Jun. 30, 2018
Earnings Per Share [Abstract]  
Calculations of Net Loss Per Share
The calculations of net loss per share were as follows:
   
Three months ended June 30,
 
Six months ended June 30,
   
2018
 
2017
 
2018
 
2017
 
(Unaudited - In thousands, except per share data)
Basic:
   
 
   
 
   
 
   
Net loss
$
(24,896
)
 
$
(29,097
)
 
$
(31,066
)
 
$
(51,194
)
Weighted average common shares outstanding
20,539

 
20,411

 
20,523

 
20,395

Net loss per share
$
(1.21
)
 
$
(1.43
)
 
$
(1.51
)
 
$
(2.51
)
 
 
 
 
 
 
 
 
Diluted:
 
 
 
 
 
 
 
Net loss
$
(24,896
)
 
$
(29,097
)
 
$
(31,066
)
 
$
(51,194
)
Weighted average common shares outstanding
20,539

 
20,411

 
20,523

 
20,395

Net loss for dilutive share computation
$
(1.21
)
 
$
(1.43
)
 
$
(1.51
)
 
$
(2.51
)
 
 
 
 
 
 
 
 
v3.10.0.1
Segment Reporting (Tables)
6 Months Ended
Jun. 30, 2018
Segment Reporting [Abstract]  
Active Partner Companies by Segment
The Company’s active partner companies were as follows as of June 30, 2018:
Partner Company
Safeguard Primary Ownership as of June 30, 2018
 
Accounting Method
AdvantEdge Healthcare Solutions, Inc. 1
40.1%
 
Equity
Aktana, Inc.
24.5%
 
Equity
Brickwork
20.3%
 
Equity
CloudMine, Inc.
47.3%
 
Equity
Clutch Holdings, Inc.
41.2%
 
Equity
Flashtalking 2
10.3%
 
Other
Hoopla Software, Inc.
25.5%
 
Equity
InfoBionic, Inc.
39.5%
 
Equity
Lumesis, Inc.
43.8%
 
Equity
MediaMath, Inc. 3
20.5%
 
Equity
meQuilibrium
36.2%
 
Equity
Moxe Health Corporation
32.4%
 
Equity
NovaSom, Inc.
31.7%
 
Equity
Prognos (fka Medivo, Inc.)
28.7%
 
Equity
Propeller Health, Inc.
19.6%
 
Equity
QuanticMind, Inc.
24.7%
 
Equity
Sonobi, Inc.
21.6%
 
Equity
Syapse, Inc.
20.0%
 
Equity
T-REX Group, Inc.
21.1%
 
Equity
Transactis, Inc.
23.8%
 
Equity
Trice Medical, Inc.
24.8%
 
Equity
WebLinc, Inc.
38.0%
 
Equity
Zipnosis, Inc.
25.4%
 
Equity
v3.10.0.1
General General (Details) - USD ($)
1 Months Ended 3 Months Ended 6 Months Ended 12 Months Ended
May 15, 2018
Jul. 26, 2018
May 31, 2018
May 31, 2017
Jun. 30, 2018
Jun. 30, 2018
Jun. 30, 2017
Dec. 31, 2018
Apr. 30, 2018
Dec. 31, 2017
Dec. 31, 2016
Debt Instrument [Line Items]                      
Cash and cash equivalents         $ 26,006,000 $ 26,006,000       $ 20,751,000  
Marketable securities         700,000 700,000          
Cash, cash equivalents, and marketable securities         26,700,000 26,700,000          
Severance costs         1,700,000 2,800,000          
Cash and cash equivalents         26,006,000 26,006,000       20,751,000  
Long-term restricted cash equivalents         0 0       6,336,000  
Total cash, cash equivalents and restricted cash equivalents         26,006,000 26,006,000 $ 54,517,000     $ 27,087,000 $ 28,394,000
Proceeds from credit facility           35,000,000 $ 50,000,000        
Revolving Credit Facility | Line of Credit                      
Debt Instrument [Line Items]                      
Liquidity threshold       $ 20,000,000              
Minimum aggregate appraised value plus liquidity threshold       350,000,000              
Scenario, Forecast                      
Debt Instrument [Line Items]                      
Severance costs               $ 3,600,000      
Scenario, Forecast | Minimum                      
Debt Instrument [Line Items]                      
Projected annual cost savings               8,000,000      
Scenario, Forecast | Maximum                      
Debt Instrument [Line Items]                      
Projected annual cost savings               $ 9,000,000      
Subsequent Event [Member]                      
Debt Instrument [Line Items]                      
Proceeds from sale of equity method investments   $ 55,000,000                  
MediaMath, Inc. | Subsequent Event [Member]                      
Debt Instrument [Line Items]                      
Equity Method Investments, Percent of Ownership Sold   39.13%                  
Proceeds from sale of equity method investments   $ 45,000,000                  
Equity Method Investments, Percent of Ownership Sold, Repurchase Option Within 180 Days   10.87%                  
Equity Method Investments, Sale Price, Repurchase Option Within 180 Days   $ 12,500,000                  
AdvantEdge Healthcare Solutions, Inc. | Subsequent Event [Member]                      
Debt Instrument [Line Items]                      
Proceeds from sale of equity method investments   10,000,000                  
Equity Method Investments, Sale of Investments, Additional Amount Receivable After Certain Valuation Thresholds   $ 6,300,000                  
Amended Credit Facility [Member]                      
Debt Instrument [Line Items]                      
Current borrowing capacity         15,000,000 15,000,000          
Maximum borrowing capacity     $ 100,000,000.0                
Debt Instrument, Debt Covenants, Cash and Cash Equivalent Threshold     50,000,000                
Long-term line of credit outstanding         $ 85,000,000 $ 85,000,000          
Liquidity threshold     20,000,000                
Minimum aggregate appraised value plus liquidity threshold     350,000,000                
Debt Instrument, Debt Covenant, Deployment Threshold     40,000,000.0                
Debt Instrument, Debt Covenant, Expense Threshold     11,500,000.0                
Amended Credit Facility [Member] | Revolving Credit Facility                      
Debt Instrument [Line Items]                      
Maximum borrowing capacity     15,000,000.0                
Amended Credit Facility [Member] | Term Loan [Member]                      
Debt Instrument [Line Items]                      
Maximum borrowing capacity     85,000,000.0                
Long-term line of credit outstanding     35,000,000           $ 50,000,000    
Proceeds from credit facility     $ 32,700,000                
Credit Facility [Member] | Revolving Credit Facility                      
Debt Instrument [Line Items]                      
Maximum borrowing capacity       75,000,000.0              
Long-term line of credit outstanding       50,000,000              
Proceeds from credit facility       $ 44,300,000              
2018 Debentures [Member]                      
Debt Instrument [Line Items]                      
Repayments of debt $ 41,000,000                    
v3.10.0.1
Ownership Interests in and Advances to Partner Companies and Funds - Carrying Value (Detail) - USD ($)
$ in Thousands
Jun. 30, 2018
Dec. 31, 2017
Investments In And Advances To Affiliates [Line Items]    
Equity method investments $ 78,516 $ 108,089
Cost method investments 14,902 4,096
Advances to partner companies 17,014 22,506
Investments in and advance to affiliates, subsidiaries, associates, and joint ventures 110,432 134,691
Partner companies    
Investments In And Advances To Affiliates [Line Items]    
Equity method investments 78,075 107,646
Cost method investments 13,568 2,762
Private equity funds    
Investments In And Advances To Affiliates [Line Items]    
Equity method investments 441 443
Cost method investments $ 1,334 $ 1,334
v3.10.0.1
Ownership Interests in and Advances to Partner Companies and Funds - Narrative (Detail) - USD ($)
1 Months Ended 3 Months Ended 6 Months Ended
Jul. 26, 2018
May 31, 2018
Feb. 28, 2018
Jan. 31, 2018
Aug. 31, 2017
Mar. 31, 2017
Jun. 30, 2018
Mar. 31, 2018
Jun. 30, 2018
Jun. 30, 2017
Dec. 31, 2017
Mar. 03, 2017
Investment [Line Items]                        
Equity method investments             $ 78,516,000   $ 78,516,000   $ 108,089,000  
Proceeds from sale of business                 14,912,000 $ 16,462,000    
Cask Data                        
Investment [Line Items]                        
Equity Method Investment, Realized Gain (Loss) on Disposal   $ 4,200,000                    
Equity method investments               $ 13,300,000        
Proceeds from sale of equity method investments   11,500,000                    
Equity Method Investments, Amount in Holdbacks and Escrows   $ 2,400,000                    
Beyond.com, Inc                        
Investment [Line Items]                        
Consideration received per transaction           $ 26,000,000            
Proceeds from sale of business     $ 10,500,000     $ 15,500,000            
Term of note receivable (in years)           3 years            
Amount of consideration received           $ 10,500,000            
Interest rate on note receivable                       9.50%
Loans receivable, net           $ 10,500,000         0  
Gain on sale of business                 9,500,000      
Flashtalking                        
Investment [Line Items]                        
Noncontrolling interest, ownership percentage by noncontrolling owners       10.00%                
Cost method investments, original cost       $ 11,200,000                
Cost-method investments, realized gain (loss)                 4,000,000      
Invitae Corporation                        
Investment [Line Items]                        
Trading securities sold     414,237                  
Proceeds from sale of trading securities held-for-investment     $ 2,600,000         $ 2,600,000        
Number of shares received (in shares)         414,237              
Number of shares received, amount held in escrow (in shares)         124,092              
Trading securities, equity                     $ 3,800,000  
Trading securities, realized gain (loss)                 1,200,000      
Aventura                        
Investment [Line Items]                        
Proceeds from sale of equity method investments       $ 600,000                
Gain (loss) on sale of equity investments                 600,000      
Apprenda                        
Investment [Line Items]                        
Equity Method Investment, Other than Temporary Impairment             6,600,000   6,600,000      
Equity method investments             $ 0   $ 0      
Beyond.com, Inc                        
Investment [Line Items]                        
Repayments of debt     $ 10,500,000                  
Subsequent Event [Member]                        
Investment [Line Items]                        
Proceeds from sale of equity method investments $ 55,000,000                      
v3.10.0.1
Acquisitions of Ownership Interests in Partner Companies and Funds (Detail) - USD ($)
$ in Thousands
3 Months Ended 6 Months Ended
Jun. 30, 2018
Mar. 31, 2018
Jun. 30, 2018
Jun. 30, 2017
Dec. 31, 2017
Schedule of Equity Method Investments [Line Items]          
Payments to acquire equity method investments     $ 250 $ 8,026  
Equity method investments $ 78,516   $ 78,516   $ 108,089
Novasom, Inc.          
Schedule of Equity Method Investments [Line Items]          
Equity method investments   $ 25,400      
Convertible bridge loan 800 1,300      
InfoBionic          
Schedule of Equity Method Investments [Line Items]          
Equity method investments   20,500      
Convertible bridge loan 800 800      
CloudMine          
Schedule of Equity Method Investments [Line Items]          
Equity method investments   10,000      
Convertible bridge loan 500        
Spongecell          
Schedule of Equity Method Investments [Line Items]          
Equity method investments         18,600
Convertible bridge loan   500      
WebLinc          
Schedule of Equity Method Investments [Line Items]          
Equity method investments   14,500      
Convertible bridge loan 200 500      
Propeller          
Schedule of Equity Method Investments [Line Items]          
Equity method investments   14,000      
Convertible bridge loan 300        
BrickWork          
Schedule of Equity Method Investments [Line Items]          
Equity method investments         $ 4,200
Convertible bridge loan   400      
Cask Data          
Schedule of Equity Method Investments [Line Items]          
Equity method investments   13,300      
Convertible bridge loan 200 300      
Sonobi          
Schedule of Equity Method Investments [Line Items]          
Equity method investments   9,400      
Convertible bridge loan $ 1,500 $ 200      
v3.10.0.1
Fair Value Measurements - Carrying Value and Fair Value of Certain Financial Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) - USD ($)
$ in Thousands
Jun. 30, 2018
Dec. 31, 2017
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Long-term restricted cash equivalents $ 0 $ 6,336
Trading securities 0 3,761
Reported Value Measurement [Member] | Fair Value, Measurements, Recurring    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Cash and cash equivalents 26,006 20,751
Long-term restricted cash equivalents   6,336
Trading securities   3,761
Reported Value Measurement [Member] | Fair Value, Measurements, Recurring | Certificates of deposit    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Marketable securities—held-to-maturity: 688 4,452
Reported Value Measurement [Member] | Fair Value, Measurements, Recurring | Debt    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Credit facility repayment feature liability 2,979  
Estimate of Fair Value Measurement [Member] | Fair Value, Measurements, Recurring | Level 1    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Cash and cash equivalents 26,006 20,751
Long-term restricted cash equivalents   6,336
Trading securities   3,761
Estimate of Fair Value Measurement [Member] | Fair Value, Measurements, Recurring | Level 2    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Cash and cash equivalents 0 0
Long-term restricted cash equivalents   0
Trading securities   0
Estimate of Fair Value Measurement [Member] | Fair Value, Measurements, Recurring | Level 3    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Cash and cash equivalents 0 0
Long-term restricted cash equivalents   0
Trading securities   0
Estimate of Fair Value Measurement [Member] | Fair Value, Measurements, Recurring | Certificates of deposit | Level 1    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Marketable securities—held-to-maturity: 688 4,452
Estimate of Fair Value Measurement [Member] | Fair Value, Measurements, Recurring | Certificates of deposit | Level 2    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Marketable securities—held-to-maturity: 0 0
Estimate of Fair Value Measurement [Member] | Fair Value, Measurements, Recurring | Certificates of deposit | Level 3    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Marketable securities—held-to-maturity: 0 $ 0
Estimate of Fair Value Measurement [Member] | Fair Value, Measurements, Recurring | Debt | Level 1    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Credit facility repayment feature liability 0  
Estimate of Fair Value Measurement [Member] | Fair Value, Measurements, Recurring | Debt | Level 2    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Credit facility repayment feature liability 0  
Estimate of Fair Value Measurement [Member] | Fair Value, Measurements, Recurring | Debt | Level 3    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Credit facility repayment feature liability $ 2,979  
v3.10.0.1
Fair Value Measurements - Narrative (Detail) - USD ($)
$ in Thousands
1 Months Ended 3 Months Ended
Feb. 28, 2018
Aug. 31, 2017
Mar. 31, 2018
Jun. 30, 2018
May 31, 2018
Dec. 31, 2017
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]            
Marketable securities, current       $ 688   $ 4,452
Credit facility repayment feature liability       2,979   $ 0
Amended Credit Facility [Member]            
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]            
Credit facility repayment feature liability       $ 3,000 $ 500  
Debt Instrument, Debt Covenants, Cash and Cash Equivalent Threshold         $ 50,000  
Good Start Genetics, Inc.            
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]            
Number of shares received (in shares)   414,237        
Invitae Corporation            
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]            
Number of shares received (in shares)   414,237        
Proceeds from sale of trading securities held-for-investment $ 2,600   $ 2,600      
v3.10.0.1
Credit Facility and Convertible Debentures - Credit Arrangements Narrative (Detail) - USD ($)
1 Months Ended 3 Months Ended 6 Months Ended
May 15, 2018
Jul. 26, 2018
May 31, 2018
May 31, 2017
Jun. 30, 2018
Jun. 30, 2017
Jun. 30, 2018
Jun. 30, 2017
Apr. 30, 2018
Dec. 31, 2017
Debt Instrument [Line Items]                    
Proceeds from credit facility             $ 35,000,000 $ 50,000,000    
Credit facility repayment feature liability         $ 2,979,000   2,979,000     $ 0
Debt Instrument, Gain (Loss) from Covenant Liability         (2,500,000)          
Interest expense         3,422,000 $ 2,112,000 6,112,000 3,310,000    
Subsequent Event [Member]                    
Debt Instrument [Line Items]                    
Proceeds from sale of equity method investments   $ 55,000,000                
Convertible Debt                    
Debt Instrument [Line Items]                    
Interest expense         $ 400,000 1,200,000 $ 1,300,000 2,300,000    
Debt instrument, interest rate, effective percentage         8.70%   8.70%      
Interest paid         $ 1,100,000 1,500,000 $ 1,100,000 1,500,000    
Credit Facility [Member]                    
Debt Instrument [Line Items]                    
Debt Instrument, Debt Covenant, Cash and Cash Equivalent Threshold, Interest and Prepayment Fee Percent     100.00%              
Amended Credit Facility [Member]                    
Debt Instrument [Line Items]                    
Maximum borrowing capacity     $ 100,000,000.0              
Long-term line of credit outstanding         85,000,000   85,000,000      
Debt Instrument, Debt Covenants, Cash and Cash Equivalent Threshold     50,000,000              
Liquidity threshold     20,000,000              
Minimum aggregate appraised value plus liquidity threshold     350,000,000              
Debt Instrument, Debt Covenant, Deployment Threshold     40,000,000.0              
Debt Instrument, Debt Covenant, Expense Threshold     11,500,000.0              
Unamortized discount and debt issuance costs         6,000,000   6,000,000      
Long-term debt         79,000,000   79,000,000      
Credit facility repayment feature liability     500,000   3,000,000   3,000,000      
2018 Debentures [Member]                    
Debt Instrument [Line Items]                    
Repayments of debt $ 41,000,000                  
Revolving Credit Facility | Line of Credit                    
Debt Instrument [Line Items]                    
Liquidity threshold       $ 20,000,000            
Minimum aggregate appraised value plus liquidity threshold       350,000,000            
Interest expense         $ 2,900,000 $ 900,000 $ 4,700,000 $ 900,000    
Debt instrument, interest rate, effective percentage         14.90%   14.90%      
Interest paid         $ 1,300,000   $ 2,600,000      
Revolving Credit Facility | Credit Facility [Member]                    
Debt Instrument [Line Items]                    
Maximum borrowing capacity       75,000,000.0            
Long-term line of credit outstanding       50,000,000            
Proceeds from credit facility       $ 44,300,000            
Debt instrument, term (in years)       3 years            
Interest payable amount outstanding threshold       $ 50,000,000            
Commitment fee percentage       0.75%            
Revolving Credit Facility | Credit Facility [Member] | Interest Rate Application A | London Interbank Offered Rate (LIBOR)                    
Debt Instrument [Line Items]                    
Basis spread on variable rate       8.50%            
Revolving Credit Facility | Credit Facility [Member] | Interest Rate Application A | London Interbank Offered Rate (LIBOR) | Minimum                    
Debt Instrument [Line Items]                    
Basis spread on variable rate       1.00%            
Revolving Credit Facility | Credit Facility [Member] | Interest Rate Application B                    
Debt Instrument [Line Items]                    
Basis spread on variable rate       2.00%            
Revolving Credit Facility | Credit Facility [Member] | Interest Rate Application B | Minimum                    
Debt Instrument [Line Items]                    
Basis spread on variable rate       7.50%            
Revolving Credit Facility | Credit Facility [Member] | Interest Rate Application B | London Interbank Offered Rate (LIBOR)                    
Debt Instrument [Line Items]                    
Basis spread on variable rate       1.00%            
Revolving Credit Facility | Credit Facility [Member] | Interest Rate Application B | Federal Funds Effective Swap Rate                    
Debt Instrument [Line Items]                    
Basis spread on variable rate       0.50%            
Revolving Credit Facility | Amended Credit Facility [Member]                    
Debt Instrument [Line Items]                    
Maximum borrowing capacity     15,000,000.0              
Term Loan [Member] | Amended Credit Facility [Member]                    
Debt Instrument [Line Items]                    
Maximum borrowing capacity     85,000,000.0              
Long-term line of credit outstanding     35,000,000           $ 50,000,000  
Proceeds from credit facility     $ 32,700,000              
v3.10.0.1
Credit Facility and Convertible Debentures - Convertible Senior Debentures Narrative (Detail) - USD ($)
2 Months Ended 3 Months Ended 6 Months Ended
May 15, 2018
Jul. 31, 2017
Jun. 30, 2018
Jun. 30, 2017
Jun. 30, 2018
Jun. 30, 2017
Nov. 30, 2012
Debt Instrument [Line Items]              
Interest expense     $ 3,422,000 $ 2,112,000 $ 6,112,000 $ 3,310,000  
2018 Debentures [Member]              
Debt Instrument [Line Items]              
Repayments of debt $ 41,000,000            
Convertible Debt              
Debt Instrument [Line Items]              
Aggregate face value of convertible senior debentures             $ 55,000,000.0
Interest rate on debentures             5.25%
Repurchased face amount   $ 14,000,000          
Repayments of long-term debt   $ 14,500,000          
Interest expense     $ 400,000 1,200,000 $ 1,300,000 2,300,000  
Debt instrument, interest rate, effective percentage     8.70%   8.70%    
Interest paid     $ 1,100,000 $ 1,500,000 $ 1,100,000 $ 1,500,000  
v3.10.0.1
Stock-Based Compensation - Stock-Based Compensation Expense (Detail) - USD ($)
$ in Thousands
3 Months Ended 6 Months Ended
Jun. 30, 2018
Jun. 30, 2017
Jun. 30, 2018
Jun. 30, 2017
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]        
Stock-based compensation expense $ 332 $ 351 $ 610 $ 246
General And Administrative Expenses        
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]        
Stock-based compensation expense $ 332 $ 351 $ 610 $ 246
v3.10.0.1
Income Taxes (Detail) - USD ($)
$ in Thousands
3 Months Ended 6 Months Ended 12 Months Ended
Jun. 30, 2018
Jun. 30, 2017
Jun. 30, 2018
Jun. 30, 2017
Dec. 31, 2017
Income Tax Disclosure [Abstract]          
Income tax benefit (expense) $ 0 $ 0 $ 0 $ 0  
Provisional income tax expense (benefit)         $ 82,500
v3.10.0.1
Net Income (Loss) Per Share - Calculations of Net Income (Loss) Per Share (Detail) - USD ($)
$ / shares in Units, shares in Thousands, $ in Thousands
3 Months Ended 6 Months Ended
Jun. 30, 2018
Jun. 30, 2017
Jun. 30, 2018
Jun. 30, 2017
Basic:        
Net income (loss) $ (24,896) $ (29,097) $ (31,066) $ (51,194)
Weighted average common shares outstanding (in shares) 20,539 20,411 20,523 20,395
Net income (loss) per share (in dollars per share) $ (1.21) $ (1.43) $ (1.51) $ (2.51)
Diluted:        
Weighted average common shares outstanding $ 20,539 $ 20,411 $ 20,523 $ 20,395
Net loss for dilutive share computation $ 0 $ 0 $ 0 $ 0
v3.10.0.1
Net Income (Loss) Per Share - Narrative (Detail) - $ / shares
shares in Millions
6 Months Ended
Jun. 30, 2018
Jun. 30, 2017
Stock Options    
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]    
Share of common stock excluded from diluted net loss per share calculation (in shares) 0.5 0.7
Shares of common stock at prices ranging, lower limit (in dollars per share) $ 9.83 $ 9.83
Shares of common stock at prices ranging, upper limit (in dollars per share) $ 19.95 $ 19.95
Deferred stock units, performance-based stock units and restricted stock    
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]    
Share of common stock excluded from diluted net loss per share calculation (in shares) 0.8 0.9
Convertible Senior Debentures due 2018    
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]    
Share of common stock excluded from diluted net loss per share calculation (in shares) 2.3 2.4
v3.10.0.1
Segment Reporting - Narrative (Detail)
6 Months Ended
Jun. 30, 2018
segment
nonconsolidated_partner_company
Segment Reporting [Abstract]  
Number of operating segments | segment 1
Non-consolidated partner companies | nonconsolidated_partner_company 23
v3.10.0.1
Segment Reporting - Active Partner Companies by Segment (Detail)
Jun. 30, 2018
AdvantEdge Healthcare Solutions, Inc.  
Schedule of Equity Method Investments [Line Items]  
Ownership interest under equity method, percentage 40.10%
BrickWork  
Schedule of Equity Method Investments [Line Items]  
Ownership interest under equity method, percentage 20.30%
CloudMine  
Schedule of Equity Method Investments [Line Items]  
Ownership interest under equity method, percentage 47.30%
Clutch Holdings, LLC  
Schedule of Equity Method Investments [Line Items]  
Ownership interest under equity method, percentage 41.20%
Flashtalking  
Schedule of Equity Method Investments [Line Items]  
Ownership interest under cost method, percentage 10.30%
Hoopla Software, Inc.  
Schedule of Equity Method Investments [Line Items]  
Ownership interest under equity method, percentage 25.50%
Lumesis, Inc.  
Schedule of Equity Method Investments [Line Items]  
Ownership interest under equity method, percentage 43.80%
MediaMath, Inc.  
Schedule of Equity Method Investments [Line Items]  
Ownership interest under equity method, percentage 20.50%
Moxe Health  
Schedule of Equity Method Investments [Line Items]  
Ownership interest under equity method, percentage 32.40%
Prognos  
Schedule of Equity Method Investments [Line Items]  
Ownership interest under equity method, percentage 28.70%
QuanticMind, Inc.  
Schedule of Equity Method Investments [Line Items]  
Ownership interest under equity method, percentage 24.70%
Sonobi  
Schedule of Equity Method Investments [Line Items]  
Ownership interest under equity method, percentage 21.60%
T-REX Group, Inc.  
Schedule of Equity Method Investments [Line Items]  
Ownership interest under equity method, percentage 21.10%
Transactis  
Schedule of Equity Method Investments [Line Items]  
Ownership interest under equity method, percentage 23.80%
WebLinc  
Schedule of Equity Method Investments [Line Items]  
Ownership interest under equity method, percentage 38.00%
Healthcare | Aktana, Inc.  
Schedule of Equity Method Investments [Line Items]  
Ownership interest under equity method, percentage 24.50%
Healthcare | InfoBionic  
Schedule of Equity Method Investments [Line Items]  
Ownership interest under equity method, percentage 39.50%
Healthcare | meQuilibrium  
Schedule of Equity Method Investments [Line Items]  
Ownership interest under equity method, percentage 36.20%
Healthcare | Novasom, Inc.  
Schedule of Equity Method Investments [Line Items]  
Ownership interest under equity method, percentage 31.70%
Healthcare | Propeller  
Schedule of Equity Method Investments [Line Items]  
Ownership interest under equity method, percentage 19.60%
Healthcare | Syapse, Inc.  
Schedule of Equity Method Investments [Line Items]  
Ownership interest under equity method, percentage 20.00%
Healthcare | Trice  
Schedule of Equity Method Investments [Line Items]  
Ownership interest under equity method, percentage 24.80%
Healthcare | Zipnosis  
Schedule of Equity Method Investments [Line Items]  
Ownership interest under equity method, percentage 25.40%
v3.10.0.1
Commitments and Contingencies (Detail) - USD ($)
$ in Thousands
1 Months Ended 3 Months Ended 6 Months Ended 12 Months Ended
Oct. 31, 2001
Jun. 30, 2018
Jun. 30, 2018
Dec. 31, 2018
Mar. 31, 2018
Dec. 31, 2017
Jun. 30, 2017
Commitment Contingencies And Guarantees [Line Items]              
Other long-term liabilities   $ 3,197 $ 3,197     $ 3,535  
Annual payments $ 650            
Severance costs   1,700 2,800        
Payments for Restructuring   300 500        
Employee Severance              
Commitment Contingencies And Guarantees [Line Items]              
Maximum severance payments   6,500 6,500        
Scenario, Forecast              
Commitment Contingencies And Guarantees [Line Items]              
Severance costs       $ 3,600      
Letter of credit              
Commitment Contingencies And Guarantees [Line Items]              
Letter of credit under the credit facility         $ 6,300    
Accrued expenses and other current liabilities              
Commitment Contingencies And Guarantees [Line Items]              
Liability to former chairman and chief executive officer, current   800 800        
Other long-term liabilities              
Commitment Contingencies And Guarantees [Line Items]              
Liability to former chairman and chief executive officer, non-current   1,500 1,500        
Accrued Compensation and Benefits              
Commitment Contingencies And Guarantees [Line Items]              
Severance costs     2,300        
Clawback Liability              
Commitment Contingencies And Guarantees [Line Items]              
Other long-term liabilities   $ 300 $ 300        
Company's ownership in the funds   19.00% 19.00%        
Clawback liability paid             $ 1,000
Private equity funds              
Commitment Contingencies And Guarantees [Line Items]              
Company outstanding guarantees   $ 3,800 $ 3,800        
v3.10.0.1
Equity (Details) - USD ($)
shares in Millions
1 Months Ended 12 Months Ended
Feb. 28, 2018
Dec. 31, 2016
Jul. 31, 2015
Equity, Class of Treasury Stock [Line Items]      
Individual ownership percent maximum 4.99%    
Common Stock      
Equity, Class of Treasury Stock [Line Items]      
Stock repurchase program, authorized amount     $ 25,000,000.0
Repurchase of common stock (in shares)   0.4  
Stock repurchased during period, value   $ 5,400,000  
Remaining authorized repurchase amount   $ 14,600,000  
v3.10.0.1
Subsequent Events (Details) - USD ($)
$ in Millions
1 Months Ended 3 Months Ended
Jul. 26, 2018
Sep. 30, 2018
Subsequent Event [Member]    
Subsequent Event [Line Items]    
Proceeds from sale of equity method investments $ 55.0  
MediaMath, Inc. | Subsequent Event [Member]    
Subsequent Event [Line Items]    
Equity Method Investments, Percent of Ownership Sold 39.13%  
Proceeds from sale of equity method investments $ 45.0  
Equity Method Investments, Percent of Ownership Sold, Repurchase Option Within 180 Days 10.87%  
Equity Method Investments, Sale Price, Repurchase Option Within 180 Days $ 12.5  
AdvantEdge Healthcare Solutions, Inc. | Subsequent Event [Member]    
Subsequent Event [Line Items]    
Proceeds from sale of equity method investments 10.0  
Equity Method Investments, Sale of Investments, Additional Amount Receivable After Certain Valuation Thresholds $ 6.3  
Scenario, Forecast | AdvantEdge Healthcare Solutions, Inc.    
Subsequent Event [Line Items]    
Equity Method Investment, Realized Gain (Loss) on Disposal   $ 5.5
Minimum | Scenario, Forecast | MediaMath, Inc.    
Subsequent Event [Line Items]    
Equity Method Investment, Realized Gain (Loss) on Disposal   43.0
Maximum | Scenario, Forecast | MediaMath, Inc.    
Subsequent Event [Line Items]    
Equity Method Investment, Realized Gain (Loss) on Disposal   $ 45.0