Subsequent Events

9 Months Ended

Sep. 30, 2014

Subsequent Events [Abstract]

Subsequent Events

Note 14. Subsequent event

Acquisition

On October 22, 2014, the Company entered into an Asset Purchase Agreement (the “Purchase Agreement”), with EMCORE Corporation, as approved by the Company’s Board of Directors. Consummation of this Purchase Agreement is subject to customary closing conditions and is expected to close by early January 2015.  

Under the Purchase Agreement, the Company agreed to purchase certain assets and assume certain liabilities of EMCORE’s tunable laser and transceiver product lines for $17.5 million in total consideration. Purchase consideration would consist of $1.5 million in cash at closing with the balance to be paid pursuant to a promissory note with a two-year term. The promissory note will bear interest of 5% per annum for the first year and 13% per annum for the second year. The interest will be payable semi-annually in cash, and the promissory note will mature two years from the closing of the transaction. In addition, the promissory note will be subject to prepayment under certain circumstances and will be secured by certain of the assets to be sold pursuant to the Purchase Agreement. Under the Purchase Agreement, the purchase price is subject to certain adjustments for inventory, net accounts receivable, pre-closing revenues and the principal amount due under the promissory note will be increased and decreased, as applicable, by an amount corresponding to any such adjustment. The Company will account for the transaction as a business combination.