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Joint Venture Agreement
12 Months Ended
Dec. 31, 2011
Joint Venture Agreement [Abstract]  
Joint Venture Agreement

14. Joint Venture Agreement

On January 13, 2010, the Company entered into a Joint Venture Agreement (the “Protector Group Agreement”) with RouteCloud, LLC (“RouteCloud”) and certain other parties to establish the TASER Protector Group to exclusively develop, market, sell and support a new suite of products (“Protector Products”) that give parents the ability to manage their children’s mobile phone usage and driving behaviors though a simple-to-use interface on a mobile phone, computer or TV. The Company agreed to provide RouteCloud development funding up to $1.7 million, $0.3 million of which was funded in the fourth quarter of 2009 under a letter of understanding between the parties. During 2010, $1.2 million was funded under the Joint Venture agreement prior to revision on November 2, 2010.

On November 2, 2010, the Company entered into a revised agreement with RouteCloud and the other parties to the Protector Group Agreement, pursuant to which, among other things, the original Protector Group Agreement was terminated retroactively, effective as of September 29, 2010. The new agreement also provides that the Company will (i) reimburse RouteCloud the sum of $75,000 for certain transition expenses, (ii) assume responsibility for the ongoing development, marketing, sale and support of Protector Products, (iii) offer employment or consulting arrangements to certain RouteCloud personnel, and (iv) pay RouteCloud royalties on the sale of Protector Products.

The Company agreed to advance RouteCloud $180,000 in royalties, which advance will be offset against royalties otherwise payable to RouteCloud beginning in the second year following the first revenues from the sale of Protector Products.

During 2010, the Company incurred $0.3 million of salary and consulting related costs related to the internal development of Protector Products following the effective date of the revised agreement with RouteCloud.

During the second quarter of 2011, the Company recognized an impairment charge of $1.4 million relative to its Protector product line following the Company’s decision to abandon the development of this product line. Included in the impairment charges were charges for capitalized software development, prepaid royalties, and presale inventory.