Document And Entity Information
Document And Entity Information - shares | 6 Months Ended | |
Jun. 30, 2018 | Aug. 13, 2018 | |
Document Information [Line Items] | ||
Entity Registrant Name | BIO KEY INTERNATIONAL INC | |
Entity Central Index Key | 1,019,034 | |
Trading Symbol | bkyi | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Current Reporting Status | Yes | |
Entity Voluntary Filers | No | |
Entity Well-known Seasoned Issuer | No | |
Entity Common Stock, Shares Outstanding (in shares) | 12,591,279 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Current Period Unaudited) - USD ($) | Jun. 30, 2018 | Dec. 31, 2017 |
ASSETS | ||
Cash and cash equivalents | $ 304,006 | $ 288,721 |
Accounts receivable, net | 491,651 | 2,875,946 |
Due from factor | 27,663 | 109,865 |
Inventory | 930,478 | 946,847 |
Resalable software license rights | 2,820,000 | 2,640,000 |
Prepaid expenses and other | 156,695 | 152,654 |
Total current assets | 4,730,493 | 7,014,033 |
Resalable software license rights, net of current portion | 6,425,706 | 7,933,808 |
Accounts receivable, net of current portion | 720,000 | 760,000 |
Equipment and leasehold improvements, net | 189,360 | 181,165 |
Capitalized contract costs, net | 341,622 | |
Deposits and other assets | 8,712 | 8,712 |
Intangible assets, net | 187,826 | 181,104 |
Total non-current assets | 7,873,226 | 9,064,789 |
TOTAL ASSETS | 12,603,719 | 16,078,822 |
LIABILITIES | ||
Accounts payable | 330,431 | 499,230 |
Accrued liabilities | 484,578 | 688,023 |
Dividends payable | 630,408 | |
Deferred revenue | 328,183 | 507,866 |
Total current liabilities | 1,143,192 | 2,325,527 |
TOTAL LIABILITIES | 1,143,192 | 2,325,527 |
Commitments and contingencies | ||
STOCKHOLDERS’ EQUITY | ||
Common stock: authorized, 170,000,000 shares; issued and outstanding; 12,587,997 and 7,691,324 of $.0001 par value at June 30, 2018 and December 31, 2017, respectively | 1,259 | 769 |
Additional paid-in capital | 82,143,199 | 80,829,001 |
Accumulated deficit | (70,683,931) | (67,076,492) |
TOTAL STOCKHOLDERS’ EQUITY | 11,460,527 | 13,753,295 |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | 12,603,719 | 16,078,822 |
Series A-1 Convertible Preferred Stock [Member] | ||
STOCKHOLDERS’ EQUITY | ||
Preferred stock | 6 | |
Series B-1 Convertible Preferred Stock [Member] | ||
STOCKHOLDERS’ EQUITY | ||
Preferred stock | $ 11 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - USD ($) | Jun. 30, 2018 | Dec. 31, 2017 |
Preferred stock, shares authorized (in shares) | 5,000,000 | |
Preferred stock, par value (in dollars per share) | $ 0.0001 | |
Common stock, shares authorized (in shares) | 170,000,000 | 170,000,000 |
Common stock, shares issued (in shares) | 12,587,997 | 7,691,324 |
Common stock, shares outstanding (in shares) | 12,587,997 | 7,691,324 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Series A-1 Convertible Preferred Stock [Member] | ||
Preferred stock, shares authorized (in shares) | 100,000 | 100,000 |
Preferred stock, liquidation value | $ 100 | $ 100 |
Preferred stock, shares issued (in shares) | 0 | 62,596 |
Preferred stock, shares outstanding (in shares) | 0 | 62,596 |
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Series B-1 Convertible Preferred Stock [Member] | ||
Preferred stock, shares authorized (in shares) | 105,000 | 105,000 |
Preferred stock, liquidation value | $ 100 | $ 100 |
Preferred stock, shares issued (in shares) | 0 | 105,000 |
Preferred stock, shares outstanding (in shares) | 0 | 105,000 |
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Revenues | ||||
Revenue | $ 748,141 | $ 886,881 | $ 1,589,596 | $ 2,305,216 |
Costs and other expenses | ||||
Costs and other expenses | 1,029,803 | 795,961 | 2,209,248 | 1,456,895 |
Gross profit (loss) | (281,662) | 90,920 | (619,652) | 848,321 |
Operating Expenses | ||||
Selling, general and administrative | 1,076,184 | 1,431,208 | 2,538,038 | 3,051,358 |
Research, development and engineering | 297,633 | 449,049 | 689,787 | 942,493 |
Total Operating Expenses | 1,373,817 | 1,880,257 | 3,227,825 | 3,993,851 |
Operating loss | (1,655,479) | (1,789,337) | (3,847,477) | (3,145,530) |
Other income | ||||
Interest income | 14 | 8 | 21 | 14 |
Total other income | 14 | 8 | 21 | 14 |
Net loss | (1,655,465) | (1,789,329) | (3,847,456) | (3,145,516) |
Convertible preferred stock dividends | (41,870) | (200,625) | (198,033) | (401,250) |
Net loss available to common stockholders | $ (1,697,335) | $ (1,989,954) | $ (4,045,489) | $ (3,546,766) |
Basic and Diluted Loss per Common Share (in dollars per share) | $ (0.15) | $ (0.32) | $ (0.42) | $ (0.57) |
Weighted Average Shares Outstanding: | ||||
Basic and diluted (in shares) | 11,375,320 | 6,359,974 | 9,623,151 | 6,228,197 |
Service [Member] | ||||
Revenues | ||||
Revenue | $ 249,121 | $ 134,061 | $ 551,570 | $ 454,648 |
Costs and other expenses | ||||
Costs and other expenses | 120,841 | 55,660 | 275,573 | 94,480 |
License [Member] | ||||
Revenues | ||||
Revenue | 154,251 | 127,751 | 256,970 | 624,319 |
Costs and other expenses | ||||
Costs and other expenses | 908,962 | 740,301 | 1,933,675 | 1,362,415 |
Hardware [Member] | ||||
Revenues | ||||
Revenue | $ 344,769 | $ 625,069 | $ 781,056 | $ 1,226,249 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 2 Months Ended | 3 Months Ended | 6 Months Ended | 8 Months Ended | ||
May 23, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | May 31, 2018 | |
CASH FLOW FROM OPERATING ACTIVITIES: | ||||||
Net loss | $ (1,655,465) | $ (1,789,329) | $ (3,847,456) | $ (3,145,516) | ||
Adjustments to reconcile net loss to net cash provided by (used for) operating activities: | ||||||
Bad debt expense | 500,000 | |||||
Depreciation | 44,596 | 15,513 | ||||
Amortization of intangible assets | 8,966 | 6,833 | ||||
Amortization of resalable software license rights | 1,318,559 | 729,755 | ||||
Amortization of capitalized contract costs | 59,044 | |||||
Share-based and warrant compensation for employees and consultants | 676,454 | 564,275 | ||||
Stock based directors fees | 23,021 | 10,008 | ||||
Change in assets and liabilities: | ||||||
Accounts receivable | 2,424,295 | 715,357 | ||||
Due from factor | 82,202 | 24,176 | ||||
Change in contract assets | (101,605) | |||||
Inventory | 16,369 | (101,754) | ||||
Resalable software license rights | 9,543 | 75,648 | ||||
Prepaid expenses and other | (4,041) | 16,556 | ||||
Accounts payable | (168,799) | (133,215) | ||||
Accrued liabilities | (203,445) | 86,027 | ||||
Deferred revenue | (179,683) | (215,598) | ||||
Net cash provided by (used for) operating activities | 98,976 | (851,935) | ||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||
Capital expenditures | (68,479) | (140,664) | ||||
Net cash used for investing activities | (68,479) | (140,664) | ||||
CASH FLOW FROM FINANCING ACTIVITIES: | ||||||
Issuance of common stock | 1,000,000 | |||||
Costs to issue preferred and common stock | (15,212) | (80,366) | ||||
Net cash provided by (used for) financing activities | (15,212) | 919,634 | ||||
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 15,285 | (72,965) | ||||
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | 288,721 | 1,061,307 | ||||
CASH AND CASH EQUIVALENTS, END OF PERIOD | 304,006 | 988,342 | 304,006 | 988,342 | ||
Cash paid for: | ||||||
Interest | ||||||
Income taxes | ||||||
Noncash investing and financing activities | ||||||
Accrual of unpaid dividends on preferred stock | $ 198,033 | $ 401,250 | 198,033 | 401,250 | ||
Issuance of common stock for consultancy services | 114,585 | |||||
Conversion of Dividends Payable on Series A-1 Preferred Stock to Common Stock [Member] | ||||||
Noncash investing and financing activities | ||||||
Conversion of preferred dividends payable to common stock | 356,015 | $ 896,015 | ||||
Conversion of Series A-1 Shares into Common Stock [Member] | ||||||
Noncash investing and financing activities | ||||||
Conversion of preferred stock to common stock | 6,259,600 | |||||
Conversion of Dividends Payable on Series B-1 Preferred Stock to Common Stock [Member] | ||||||
Noncash investing and financing activities | ||||||
Conversion of preferred dividends payable to common stock | $ 472,426 | 472,426 | ||||
Conversion of Series B-1 Shares into Common Stock [Member] | ||||||
Noncash investing and financing activities | ||||||
Conversion of preferred stock to common stock | $ 10,500,000 |
Note 1 - Nature of Business and
Note 1 - Nature of Business and Basis of Presentation | 6 Months Ended |
Jun. 30, 2018 | |
Notes to Financial Statements | |
Business Description and Accounting Policies [Text Block] | 1. NATURE OF BUSINESS AND BASIS OF PRESENTATION Nature of Business BIO-key International, Inc., founded in 1993, Basis of Presentation The accompanying unaudited interim condensed consolidated financial statements include the accounts of BIO-key International, Inc. and its wholly-owned subsidiary (collectively, the “Company” or “BIO-key”) and are stated in conformity with accounting principles generally accepted in the United States of America, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). The operating results for interim periods are not may In the opinion of management, the accompanying unaudited interim consolidated financial statements contain all necessary adjustments, consisting only of those of a recurring nature, and disclosures to present fairly the Company’s financial position and the results of its operations and cash flows for the periods presented. The balance sheet at June 30, 2018 not 10 December 31, 2017, April 2, 2018. Recently Issued Accounting Pronouncements In May 2014, No. 2014 09, 2014 09 606 January 1, 2018 3 In February 2016, 2016 02, 12 December 15, 2018, In July 2017, 2017 11, 260 480 815 2017 11, not no 480, not December 15, 2018, 2017 11, 2017 not Management does not not Reclassification Reclassifications occurred to certain prior year amounts in order to conform to the current year classifications including segregating the hardware revenues. The reclassifications have no |
Note 2 - Going Concern
Note 2 - Going Concern | 6 Months Ended |
Jun. 30, 2018 | |
Notes to Financial Statements | |
Substantial Doubt about Going Concern [Text Block] | 2. GOING CONCERN The Company has incurred significant losses to date and at June 30, 2018 $71 June 30, 2018, $304,000, $289,000 December 31, 2017. The Company has financed operations in the past through access to the capital markets by issuing secured and convertible debt securities, convertible preferred stock, common stock, and through factoring receivables. The Company estimates that it currently requires approximately $592,000 If the Company is unable to generate sufficient revenue to meet its goals, it will need to obtain additional third No not The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP"), which contemplate continuation of the Company as a going concern, and assumes continuity of operations, realization of assets and the satisfaction of liabilities and commitments in the normal course of business. The matters described in the preceding paragraphs raise substantial doubt about the Company’s ability to continue as a going concern. Recoverability of a major portion of the recorded asset amounts shown in the accompanying balance sheet is dependent upon the Company’s ability to meet its financing requirements on a continuing basis, and become profitable in its future operations. The accompanying consolidated financial statements do not |
Note 3 - Revenue From Contracts
Note 3 - Revenue From Contracts With Customers | 6 Months Ended |
Jun. 30, 2018 | |
Notes to Financial Statements | |
Revenue from Contract with Customer [Text Block] | 3. REVENUE FROM CONTRACTS WITH CUSTOMERS The Company adopted ASC 606 January 1, 2018 not 2018 606 2017 605, Revenue Recognition 605 606 606, five ● Identify the contract with a customer ● Identify the performance obligations in the contract ● Determine the transaction price ● Allocate the transaction price to performance obligations in the contract ● Recognize revenue when or as the Company satisfies a performance obligation Disaggregation of Revenue The following table summarizes revenue from contracts with customers for the three North America South America EMEA * Asia June 30, 2018 License fees $ 69,151 $ 30,000 $ 55,100 $ - $ 154,251 Hardware 120,496 53,040 10,298 160,935 344,769 Support and Maintenance 225,602 16 12,503 3,000 241,121 Professional services 6,000 - 2,000 - 8,000 Total Revenues $ 421,249 $ 83,056 $ 79,901 $ 163,935 $ 748,141 North America South America EMEA* Asia June 30, 2017 License fees $ 37,168 $ 583 $ - $ 90,000 $ 127,751 Hardware 359,732 2,011 590 262,736 625,069 Support and Maintenance 114,275 176 9,100 310 123,861 Professional services 4,800 - - 5,400 10,200 Total Revenues $ 515,975 $ 2,770 $ 9,690 $ 358,446 $ 886,881 The following table summarizes revenue from contracts with customers for the six North America South America EMEA * Asia June 30, 2018 License fees $ 130,120 $ 30,000 $ 96,850 $ - $ 256,970 Hardware 220,086 53,040 225,074 282,856 781,056 Support and Maintenance 403,518 16 21,216 16,970 441,720 Professional services 107,850 - 2,000 - 109,850 Total Revenues $ 861,574 $ 83,056 $ 345,140 $ 299,826 $ 1,589,596 North America South America EMEA* Asia June 30, 2017 License fees $ 531,735 $ 583 $ - $ 92,000 $ 624,318 Hardware 721,822 2,341 590 501,496 1,226,249 Support and Maintenance 247,701 245 15,295 708 263,949 Professional services 185,300 - - 5,400 190,700 Total Revenues $ 1,686,558 $ 3,169 $ 15,885 $ 599,604 $ 2,305,216 *EMEA – Europe, Middle East, Africa All of the Company's performance obligations, and associated revenue, are generally transferred to customers at a point in time, with the exception of support and maintenance, and professional services, which are generally transferred to the customer over time. Software licenses Software license revenue consist of fees for perpetual software licenses for one Hardware Hardware revenue consists of fees for associated equipment sold with or without a software license arrangement, such as servers, locks and fingerprint readers. Customers are not third may Support and Maintenance Support and Maintenance revenue consists of fees for unspecified upgrades, telephone assistance and bug fixes. The Company satisfies its Support and Maintenance performance obligation by providing “stand-ready” assistance as required over the contract period. The Company records deferred revenue (contract liability) at time of invoice until the contracts term occurs. Revenue is recognized over time on a ratable basis over the contract term. Support and Maintenance contracts are up to one Professional Services Professional services revenues consist primarily of fees for deployment and optimization services, as well as training. The majority of the Company’s consulting contracts are billed on a time and materials basis, and revenue is recognized based on the amount billable to the customer in accordance with practical expedient ASC 606 10 55 18. Contracts with Multiple Performance Obligations Some contracts with customers contain multiple performance obligations. For these contracts, the Company accounts for individual performance obligations separately if they are distinct. The transaction price is allocated to the separate performance obligations on a relative standalone selling price basis. The standalone selling prices are determined based on overall pricing objectives, taking into consideration market conditions and other factors, including the value of the contracts, the cloud applications sold, customer demographics, geographic locations, and the number and types of users within the contracts. The Company considered several factors in determining that control transfers to the customer upon shipment of hardware and availability of download of software. These factors include that legal title transfers to the customer, the Company has a present right to payment, and the customer has assumed the risks and rewards of ownership. Accounts receivable from customers are typically due within 30 not Costs to Obtain and Fulfill a Contract Costs to obtain and fulfill a contract are predominantly sales commissions earned by the sales force and are considered incremental and recoverable costs of obtaining a contract with a customer. These costs are deferred and then amortized over a period of benefit determined to be four Financial Statement Impact of Adopting ASC 606 The Company adopted ASC 606 not January 1, 2018 606, As a result of applying the modified retrospective method to adopt the new revenue guidance, the following adjustments were made to the following select condensed consolidated balance sheet line items as of January 1, 2018: As reported - December 31, 2017 Adjustments As adjusted - January 1, 2018 Capitalized contract assets $ - $ 240,017 $ 240,017 Total assets $ 16,078,822 $ 240,017 $ 16,318,839 Accumulated deficit $ (67,076,492 ) $ 240,017 $ (66,836,475 ) Total Stockholders’ Equity $ 13,753,295 $ 240,017 $ 13,993,312 Total Liabilities and Stockholders’ Equity $ 16,078,822 $ 240,017 $ 16,318,839 Impact of New Revenue Guidance on Financial Statement Line Items The following table compares selected reported condensed consolidated balance sheet, statement of operations and cash flows, as of and for the three six June 30, 2018, As of June 30, 2018 As reported Pro-forma Increase (decrease) Consolidated balance sheet data: Capitalized contract costs, net $ 341,622 $ - $ (341,622 ) Three Months Ended June 30, 2018 Six Months Ended June 30, 2018 As reported Pro-forma Increase (decrease) As reported Pro-forma Increase (decrease) Consolidated statement of operations data: Selling, general and administrative expenses 1,076,184 1,052,439 (23,745 ) $ 2,538,038 $ 2,639,643 $ 101,605 Net loss (1,655,465 ) (1,631,720 ) 23,745 (3,847,456 ) (3,949,061 ) (101,605 ) Net loss available to common stockholders (1,697,335 ) (1,673,590 ) 23,745 (4,045,489 ) (4,147,094 ) (101,605 ) Basic & Diluted Loss per Common Share (0.15 ) (0.15 ) 0.00 (0.42 ) (0.43 ) (0.01 ) Six Months Ended June 30, 2018 As reported Pro-forma Increase (decrease) Consolidated statement of cash flow data: Net loss (3,847,456 ) (3,949,061 ) (101,605 ) Change in contract assets (101,605 ) - 101,605 Net cash provided by operating activities 98,976 98,976 - Revenue recognized during the three six June 30, 2018 $79,000 $197,000 not $328,183 $507,866 June 30, 2018 December 31, 2017, Transaction Price Allocated to the Remaining Performance Obligations ASC 606 not June 30, 2018. ● The performance obligation is part of a contract that has an original expected duration of one 606 10 50 14. At June 30, 2018 one |
Note 4 - Accounts Receivable
Note 4 - Accounts Receivable | 6 Months Ended |
Jun. 30, 2018 | |
Notes to Financial Statements | |
Loans, Notes, Trade and Other Receivables Disclosure [Text Block] | 4. ACCOUNTS RECEIVABLE Accounts receivable are carried at original amount less an estimate made for doubtful receivables based on a review of all outstanding amounts on a monthly basis. Management determines the allowance for doubtful receivables by regularly evaluating individual customer receivables and considering a customer’s financial condition, credit history, and current economic conditions. Accounts receivable are written off when deemed uncollectible. As a result of the payment delays for a large customer, the Company has continued to reserve $1,000,000 June 30, 2018, 58% June 30, 2018 December 31, 2017 June 30, December 31, 201 8 201 7 Accounts receivable - current $ 505,436 $ 2,889,731 Accounts receivable - non current 1,720,000 1,760,000 2,225,436 4,649,731 Allowance for doubtful accounts - current (13,785 ) (13,785 ) Allowance for doubtful accounts - non current (1,000,000 ) (1,000,000 ) (1,013,785 ) (1,013,785 ) Accounts receivable, net of allowance for doubtful accounts $ 1,211,651 $ 3,635,946 |
Note 5 - Share Based Compensati
Note 5 - Share Based Compensation | 6 Months Ended |
Jun. 30, 2018 | |
Notes to Financial Statements | |
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | 5. SHARE BASED COMPENSATION The following table presents share-based compensation expenses included in the Company’s unaudited condensed interim consolidated statements of operations: Three Months Ended June 30, 201 8 201 7 Selling, general and administrative $ 128,620 $ 394,264 Research, development and engineering 20,922 18,930 $ 149,542 $ 413,194 Six Months Ended June 30, 201 8 201 7 Selling, general and administrative $ 599,766 $ 507,120 Research, development and engineering 99,709 67,163 $ 699,475 $ 574,283 |
Note 6 - Factoring
Note 6 - Factoring | 6 Months Ended |
Jun. 30, 2018 | |
Notes to Financial Statements | |
Factoring [Text Block] | 6. FACTORING Due from factor consisted of the following as of: June 30, December 31, 201 8 201 7 Original invoice value $ 118,494 $ 423,349 Factored amount (90,831 ) (313,484 ) Due from factor $ 27,663 $ 109,865 The Company entered into an accounts receivable factoring arrangement with a financial institution (the “Factor”) which has been extended to October 31, 2018. $150,000 35% 75% 2.75% 15% Three Months ended June 30, 201 8 201 7 Factoring fees $ 12,691 $ 85,326 Six Months ended June 30, 201 8 201 7 Factoring fees $ 104,214 $ 133,717 |
Note 7 - Inventory
Note 7 - Inventory | 6 Months Ended |
Jun. 30, 2018 | |
Notes to Financial Statements | |
Inventory Disclosure [Text Block] | 7. INVENTORY Inventory is stated at the lower of cost, determined on a first first June 30, December 31, 201 8 201 7 Finished goods $ 408,984 $ 487,858 Fabricated assemblies 521,494 458,989 Total inventory $ 930,478 $ 946,847 |
Note 8 - Resalable Software Lic
Note 8 - Resalable Software License Rights | 6 Months Ended |
Jun. 30, 2018 | |
Notes to Financial Statements | |
Research, Development, and Computer Software Disclosure [Text Block] | 8. RESALABLE SOFTWARE LICENSE RIGHTS On November 11, 2015, $12,000,000. 12 $2,820,000 The Company has determined the software license rights to be a finite lived intangible asset, and estimated that the software license rights shall be economically used over a 10 fourth 2015, not January 2017. first 2017. The remaining license rights are to be amortized over the greater of the following: 1 2 ten 3 $660,000 $390,000 three June 30, 2018 2017, $1,320,000 $778,092 six June 30, 2018 2017, 2018 $2,878,596 $9,121,404 June 30, 2018. On December 31, 2015, third $180,000 three $20,642 $22,020 three June 30, 2018 2017, $8,102 $14,400 $28,716 six June 30, 2018 2017, $55,698 $124,302 June 30, 2018. June 30, December 31, 201 8 201 7 Current resalable software license rights $ 2,820,000 $ 2,640,000 Non-current resalable software license rights 6,425,706 7,933,808 Total resalable software license rights $ 9,245,706 $ 10,573,808 |
Note 9 - Earnings (Loss) Per Sh
Note 9 - Earnings (Loss) Per Share - Common Stock ("EPS") | 6 Months Ended |
Jun. 30, 2018 | |
Notes to Financial Statements | |
Earnings Per Share [Text Block] | 9. EARNINGS (LOSS) PER SHARE - COMMON STOCK (“EPS”) The Company’s basic EPS is calculated using net loss available to common shareholders and the weighted-average number of shares outstanding during the reporting period. Diluted EPS includes the effect from potential issuance of common stock, such as stock issuable pursuant to the exercise of stock options and warrants and the assumed conversion of convertible preferred stock. The reconciliation of the numerator of the basic and diluted EPS calculations was as follows for both of the following three six June 30, 2018 2017: Three Months ended June 30, Six Months ended June 30, 201 8 201 7 201 8 201 7 Basic Numerator: Net loss $ (1,655,465 ) $ (1,789,329 ) $ (3,847,456 ) $ (3,145,516 ) Convertible preferred stock dividends (41,870 ) (200,625 ) (198,033 ) (401,250 ) Net loss available to common stockholders $ (1,697,335 ) $ (1,989,954 ) $ (4,045,489 ) $ (3,546,766 ) The following table summarizes the weighted average securities that were excluded from the diluted per share calculation because the effect of including these potential shares was antidilutive due to the net losses for the three six June 30, 2018 2017: Three Months ended June 30, Six Months ended June 30, 201 8 201 7 201 8 201 7 Preferred stock 1,200,767 5,416,667 2,853,513 5,416,667 Stock options 37,015 35,706 19,863 44,580 Warrants - 3,004 - 3,336 Total 1,237,782 5,455,377 2,873,376 5,464,583 Items excluded from the diluted per share calculation because the exercise price was greater than the average market price of the common shares: Three Months ended June 30, Six Months ended June 30, 201 8 201 7 201 8 201 7 Stock options 1,366,467 218,761 1,445,891 218,761 Warrants 1,398,969 1,212,163 1,398,969 1,212,163 Total 2,765,436 1,430,924 2,844,860 1,430,924 |
Note 10 - Stockholders' Equity
Note 10 - Stockholders' Equity | 6 Months Ended |
Jun. 30, 2018 | |
Notes to Financial Statements | |
Stockholders' Equity Note Disclosure [Text Block] | 10. STOCKHOLDERS’ EQUITY Preferred Stock Within the limits and restrictions provided in the Company’s Certificate of Incorporation, the Board of Directors has the authority, without further action by the shareholders, to issue up to 5,000,000 $.0001 one June 30, 2018, 100,000 1 0 105,000 1 0 Series A- 1 On October 22 29, 2015, 84,500 1 1 $100.00 $8,450,000. November 11, 2015, 5,500 1 $100.00 $550,000. 1 1 $3.60 9.99% 1 August 7, 2017 35% 61 1 6% April 1, July, 1, October 1, January 1 October 1, 2017, ten 10 January 1, 2018, The holders of the Series A- 1 one 1 not 1 1 $100.00 1 Between September 22, 2017 May 31, 2018, 1 1 2,500,000 248,893 $896,015 1 As a result of the forgoing conversions, there are no 1 Overall balances and conversion of Series A- 1 Series A-1 Accrued Dividends Balance – January 1, 2017 90,000 $ 270,000 Accrual of dividends – Q1 2017 135,000 Accrual of dividends – Q2 2017 135,000 Accrual of dividends – Q3 2017 135,000 Conversion into common stock – September 2017 - (540,000 ) Conversion into common stock – October 2017 (27,404 ) - Accrual of dividends – Q4 2017 101,658 Balance – December 31, 2017 62,596 $ 236,658 Accrual of dividends – Q1 2018 93,894 Conversion into common stock – April 2018 (39,088 ) (330,552 ) Accrual of dividends – Q2 2018 (until final conversion) 25,463 Conversion into common stock – May 2018 (23,508 ) (25,463 ) Balance – June 30, 2018 - $ - The Series A- 1 815 15, 815 40 15, 1 $3.60 December 31, 2017, ten 10 not Series B- 1 On November 11, 2015, 105,000 1 1 $100.00 $10,500,000. 1 1 $3.60 9.99% 1 19.99% 61 1 2.5% April 1, July, 1, October 1, January 1 1 ten 10 The holders of the Series B- 1 one 1 not 1 1 $100.00 1 Between March 23, 2018 May 23, 2018, 1 1 2,916,668 131,230 $472,426 1 As a result of the forgoing conversions, there are no 1 Overall balances and conversion of Series B- 1 Series B -1 Accrued Dividends Balance – January 1, 2017 105,000 $ 131,250 Accrual of dividends – Q1 2017 65,625 Accrual of dividends – Q2 2017 65,625 Accrual of dividends – Q3 2017 65,625 Accrual of dividends – Q4 2017 65,625 Balance – December 31, 2017 105,000 393,750 Conversion into common stock – March 2018 (60,420 ) (417,084 ) Accrual of dividends – Q1 2018 62,268 Accrual of dividends – Q2 2018 (until final conversion) 16,408 Conversion into common stock – May 2018 (44,580 ) (55,342 ) Balance – June 30, 2018 - $ - The Series B- 1 815 15, 815 40 15, 1 $3.60 may ten 10 not Common Stock On March 23, 2018, 1 1,794,191 7,659 $15,011. On March 28, 2018, 762 $1,501. On April 3, 2018, 1 1,177,598 On May 10, 2018, 2,035 On May 14, 2018, 648 On May 23, 2018, 1 1,253,707 On May 31, 2018, 1 660,073 Derivative Liabilities In connection with the issuances of equity instruments or debt, the Company may may may may July 2017, 2017 11, 260 480 815 2017 11, not no Securities Purchase Agreement dated November 13, 2014 Pursuant to a Securities Purchase Agreement, dated November 13, 2014, 664,584 996,877 $1,595,000. The warrants have a term of five $3.60 February 2015. $3.60 not As a result of the early adoption of ASU 2017 11, no no no Securities Purchase Agreement dated September 23, 2015 On September 23, 2015, 69,445 $3.60 five The warrants have customary anti-dilution protections including a "full ratchet" anti-dilution adjustment provision which are triggered in the event the Company sells or $3.60 not As a result of the early adoption of ASU 2017 11, no no no Issuances of Stock Options On March 23, 2018, 9,000 six three seven $1.96. On March 23, 2018, 212,918 three seven $1.96. The fair value of the options issued during the three March 31, 2018 $381,876 2.56%, 4.5, 0, 143%. There were no three June 30, 2018. |
Note 11 - Segment Information
Note 11 - Segment Information | 6 Months Ended |
Jun. 30, 2018 | |
Notes to Financial Statements | |
Segment Reporting Disclosure [Text Block] | 11. SEGMENT INFORMATION The Company has determined that its continuing operations are one 56% 58% three June 30, 2018 2017, 54% 73% six June 30, 2018 2017, |
Note 12 - Fair Values of Financ
Note 12 - Fair Values of Financial Instruments | 6 Months Ended |
Jun. 30, 2018 | |
Notes to Financial Statements | |
Fair Value Disclosures [Text Block] | 12. FAIR VALUES OF FINANCIAL INSTRUMENTS Cash and cash equivalents, accounts receivable, accounts payable, accrued liabilities, and due from factor, are carried at, or approximate, fair value because of their short-term nature. |
Note 13 - Major Customers and A
Note 13 - Major Customers and Accounts Receivable | 6 Months Ended |
Jun. 30, 2018 | |
Notes to Financial Statements | |
Concentration Risk Disclosure [Text Block] | 13. MAJOR CUSTOMERS AND ACCOUNTS RECEIVABLE For the three June 30, 2018 2017, two 34% three 52% six June 30, 2018 2017, two 37% three 44% Four customers accounted for 53% June 30, 2018. 100% June 30, 2018 December 31, 2017. $1,000,000 58% December 31, 2017, one 55% |
Note 14 - Subsequent Events
Note 14 - Subsequent Events | 6 Months Ended |
Jun. 30, 2018 | |
Notes to Financial Statements | |
Subsequent Events [Text Block] | 14. SUBSEQUENT EVENTS On August 9, 2018, 3,282 |
Significant Accounting Policies
Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Basis of Accounting, Policy [Policy Text Block] | Basis of Presentation The accompanying unaudited interim condensed consolidated financial statements include the accounts of BIO-key International, Inc. and its wholly-owned subsidiary (collectively, the “Company” or “BIO-key”) and are stated in conformity with accounting principles generally accepted in the United States of America, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). The operating results for interim periods are not may In the opinion of management, the accompanying unaudited interim consolidated financial statements contain all necessary adjustments, consisting only of those of a recurring nature, and disclosures to present fairly the Company’s financial position and the results of its operations and cash flows for the periods presented. The balance sheet at June 30, 2018 not 10 December 31, 2017, April 2, 2018. |
New Accounting Pronouncements, Policy [Policy Text Block] | Recently Issued Accounting Pronouncements In May 2014, No. 2014 09, 2014 09 606 January 1, 2018 3 In February 2016, 2016 02, 12 December 15, 2018, In July 2017, 2017 11, 260 480 815 2017 11, not no 480, not December 15, 2018, 2017 11, 2017 not Management does not not |
Reclassification, Policy [Policy Text Block] | Reclassification Reclassifications occurred to certain prior year amounts in order to conform to the current year classifications including segregating the hardware revenues. The reclassifications have no |
Note 3 - Revenue From Contrac21
Note 3 - Revenue From Contracts With Customers (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Notes Tables | |
Disaggregation of Revenue [Table Text Block] | North America South America EMEA * Asia June 30, 2018 License fees $ 69,151 $ 30,000 $ 55,100 $ - $ 154,251 Hardware 120,496 53,040 10,298 160,935 344,769 Support and Maintenance 225,602 16 12,503 3,000 241,121 Professional services 6,000 - 2,000 - 8,000 Total Revenues $ 421,249 $ 83,056 $ 79,901 $ 163,935 $ 748,141 North America South America EMEA* Asia June 30, 2017 License fees $ 37,168 $ 583 $ - $ 90,000 $ 127,751 Hardware 359,732 2,011 590 262,736 625,069 Support and Maintenance 114,275 176 9,100 310 123,861 Professional services 4,800 - - 5,400 10,200 Total Revenues $ 515,975 $ 2,770 $ 9,690 $ 358,446 $ 886,881 North America South America EMEA * Asia June 30, 2018 License fees $ 130,120 $ 30,000 $ 96,850 $ - $ 256,970 Hardware 220,086 53,040 225,074 282,856 781,056 Support and Maintenance 403,518 16 21,216 16,970 441,720 Professional services 107,850 - 2,000 - 109,850 Total Revenues $ 861,574 $ 83,056 $ 345,140 $ 299,826 $ 1,589,596 North America South America EMEA* Asia June 30, 2017 License fees $ 531,735 $ 583 $ - $ 92,000 $ 624,318 Hardware 721,822 2,341 590 501,496 1,226,249 Support and Maintenance 247,701 245 15,295 708 263,949 Professional services 185,300 - - 5,400 190,700 Total Revenues $ 1,686,558 $ 3,169 $ 15,885 $ 599,604 $ 2,305,216 |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles [Table Text Block] | As reported - December 31, 2017 Adjustments As adjusted - January 1, 2018 Capitalized contract assets $ - $ 240,017 $ 240,017 Total assets $ 16,078,822 $ 240,017 $ 16,318,839 Accumulated deficit $ (67,076,492 ) $ 240,017 $ (66,836,475 ) Total Stockholders’ Equity $ 13,753,295 $ 240,017 $ 13,993,312 Total Liabilities and Stockholders’ Equity $ 16,078,822 $ 240,017 $ 16,318,839 As of June 30, 2018 As reported Pro-forma Increase (decrease) Consolidated balance sheet data: Capitalized contract costs, net $ 341,622 $ - $ (341,622 ) Three Months Ended June 30, 2018 Six Months Ended June 30, 2018 As reported Pro-forma Increase (decrease) As reported Pro-forma Increase (decrease) Consolidated statement of operations data: Selling, general and administrative expenses 1,076,184 1,052,439 (23,745 ) $ 2,538,038 $ 2,639,643 $ 101,605 Net loss (1,655,465 ) (1,631,720 ) 23,745 (3,847,456 ) (3,949,061 ) (101,605 ) Net loss available to common stockholders (1,697,335 ) (1,673,590 ) 23,745 (4,045,489 ) (4,147,094 ) (101,605 ) Basic & Diluted Loss per Common Share (0.15 ) (0.15 ) 0.00 (0.42 ) (0.43 ) (0.01 ) Six Months Ended June 30, 2018 As reported Pro-forma Increase (decrease) Consolidated statement of cash flow data: Net loss (3,847,456 ) (3,949,061 ) (101,605 ) Change in contract assets (101,605 ) - 101,605 Net cash provided by operating activities 98,976 98,976 - |
Note 4 - Accounts Receivable (T
Note 4 - Accounts Receivable (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Notes Tables | |
Schedule of Accounts, Notes, Loans and Financing Receivable [Table Text Block] | June 30, December 31, 201 8 201 7 Accounts receivable - current $ 505,436 $ 2,889,731 Accounts receivable - non current 1,720,000 1,760,000 2,225,436 4,649,731 Allowance for doubtful accounts - current (13,785 ) (13,785 ) Allowance for doubtful accounts - non current (1,000,000 ) (1,000,000 ) (1,013,785 ) (1,013,785 ) Accounts receivable, net of allowance for doubtful accounts $ 1,211,651 $ 3,635,946 |
Note 5 - Share Based Compensa23
Note 5 - Share Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Notes Tables | |
Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Table Text Block] | Three Months Ended June 30, 201 8 201 7 Selling, general and administrative $ 128,620 $ 394,264 Research, development and engineering 20,922 18,930 $ 149,542 $ 413,194 Six Months Ended June 30, 201 8 201 7 Selling, general and administrative $ 599,766 $ 507,120 Research, development and engineering 99,709 67,163 $ 699,475 $ 574,283 |
Note 6 - Factoring (Tables)
Note 6 - Factoring (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Notes Tables | |
Schedule of Accounts, Notes, Loans and Financing Receivable [Table Text Block] | June 30, December 31, 201 8 201 7 Accounts receivable - current $ 505,436 $ 2,889,731 Accounts receivable - non current 1,720,000 1,760,000 2,225,436 4,649,731 Allowance for doubtful accounts - current (13,785 ) (13,785 ) Allowance for doubtful accounts - non current (1,000,000 ) (1,000,000 ) (1,013,785 ) (1,013,785 ) Accounts receivable, net of allowance for doubtful accounts $ 1,211,651 $ 3,635,946 |
Factoring Fees [Table Text Block] | Three Months ended June 30, 201 8 201 7 Factoring fees $ 12,691 $ 85,326 Six Months ended June 30, 201 8 201 7 Factoring fees $ 104,214 $ 133,717 |
Factored Accounts Receivable [Member] | |
Notes Tables | |
Schedule of Accounts, Notes, Loans and Financing Receivable [Table Text Block] | June 30, December 31, 201 8 201 7 Original invoice value $ 118,494 $ 423,349 Factored amount (90,831 ) (313,484 ) Due from factor $ 27,663 $ 109,865 |
Note 7 - Inventory (Tables)
Note 7 - Inventory (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Notes Tables | |
Schedule of Inventory, Current [Table Text Block] | June 30, December 31, 201 8 201 7 Finished goods $ 408,984 $ 487,858 Fabricated assemblies 521,494 458,989 Total inventory $ 930,478 $ 946,847 |
Note 8 - Resalable Software L26
Note 8 - Resalable Software License Rights (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Notes Tables | |
Software License Rights [Table Text Block] | June 30, December 31, 201 8 201 7 Current resalable software license rights $ 2,820,000 $ 2,640,000 Non-current resalable software license rights 6,425,706 7,933,808 Total resalable software license rights $ 9,245,706 $ 10,573,808 |
Note 9 - Earnings (Loss) Per 27
Note 9 - Earnings (Loss) Per Share - Common Stock ("EPS") (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Notes Tables | |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | Three Months ended June 30, Six Months ended June 30, 201 8 201 7 201 8 201 7 Basic Numerator: Net loss $ (1,655,465 ) $ (1,789,329 ) $ (3,847,456 ) $ (3,145,516 ) Convertible preferred stock dividends (41,870 ) (200,625 ) (198,033 ) (401,250 ) Net loss available to common stockholders $ (1,697,335 ) $ (1,989,954 ) $ (4,045,489 ) $ (3,546,766 ) |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block] | Three Months ended June 30, Six Months ended June 30, 201 8 201 7 201 8 201 7 Preferred stock 1,200,767 5,416,667 2,853,513 5,416,667 Stock options 37,015 35,706 19,863 44,580 Warrants - 3,004 - 3,336 Total 1,237,782 5,455,377 2,873,376 5,464,583 Three Months ended June 30, Six Months ended June 30, 201 8 201 7 201 8 201 7 Stock options 1,366,467 218,761 1,445,891 218,761 Warrants 1,398,969 1,212,163 1,398,969 1,212,163 Total 2,765,436 1,430,924 2,844,860 1,430,924 |
Note 10 - Stockholders' Equity
Note 10 - Stockholders' Equity (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Notes Tables | |
Schedule of Preferred Stock and Accrued Dividends [Table Text Block] | Series A-1 Accrued Dividends Balance – January 1, 2017 90,000 $ 270,000 Accrual of dividends – Q1 2017 135,000 Accrual of dividends – Q2 2017 135,000 Accrual of dividends – Q3 2017 135,000 Conversion into common stock – September 2017 - (540,000 ) Conversion into common stock – October 2017 (27,404 ) - Accrual of dividends – Q4 2017 101,658 Balance – December 31, 2017 62,596 $ 236,658 Accrual of dividends – Q1 2018 93,894 Conversion into common stock – April 2018 (39,088 ) (330,552 ) Accrual of dividends – Q2 2018 (until final conversion) 25,463 Conversion into common stock – May 2018 (23,508 ) (25,463 ) Balance – June 30, 2018 - $ - Series B -1 Accrued Dividends Balance – January 1, 2017 105,000 $ 131,250 Accrual of dividends – Q1 2017 65,625 Accrual of dividends – Q2 2017 65,625 Accrual of dividends – Q3 2017 65,625 Accrual of dividends – Q4 2017 65,625 Balance – December 31, 2017 105,000 393,750 Conversion into common stock – March 2018 (60,420 ) (417,084 ) Accrual of dividends – Q1 2018 62,268 Accrual of dividends – Q2 2018 (until final conversion) 16,408 Conversion into common stock – May 2018 (44,580 ) (55,342 ) Balance – June 30, 2018 - $ - |
Note 2 - Going Concern (Details
Note 2 - Going Concern (Details Textual) - USD ($) | 6 Months Ended | ||||
Jun. 30, 2018 | Jan. 01, 2018 | Dec. 31, 2017 | Jun. 30, 2017 | Dec. 31, 2016 | |
Retained Earnings (Accumulated Deficit), Ending Balance | $ (70,683,931) | $ (66,836,475) | $ (67,076,492) | ||
Cash and Cash Equivalents, at Carrying Value, Ending Balance | 304,006 | $ 288,721 | $ 988,342 | $ 1,061,307 | |
Monthly Cash Requirement to Conduct Operations and Pay Dividend Obligations | $ 592,000 |
Note 3 - Revenue From Contrac30
Note 3 - Revenue From Contracts With Customers (Details Textual) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Capitalized Contract Cost, Amortization Period | 4 years | 4 years | ||
Contract with Customer, Liability, Revenue Recognized | $ 79,000 | $ 0 | $ 197,000 | $ 0 |
Contract with Customer, Liability, Total | $ 328,183 | $ 507,866 | $ 328,183 | $ 507,866 |
Note 3 - Revenue From Contrac31
Note 3 - Revenue From Contracts With Customers - Disaggregation of Revenue (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | ||||
Revenue | $ 748,141 | $ 886,881 | $ 1,589,596 | $ 2,305,216 | |||
North America [Member] | |||||||
Revenue | 421,249 | 515,975 | 861,574 | 1,686,558 | |||
South America [Member] | |||||||
Revenue | 83,056 | 2,770 | 83,056 | 3,169 | |||
EMEA [Member] | |||||||
Revenue | [1] | 79,901 | 9,690 | 345,140 | 15,885 | ||
Asia [Member] | |||||||
Revenue | 163,935 | 358,446 | 299,826 | 599,604 | |||
License [Member] | |||||||
Revenue | 154,251 | 127,751 | 256,970 | 624,319 | |||
License [Member] | North America [Member] | |||||||
Revenue | 69,151 | 37,168 | 130,120 | 531,735 | |||
License [Member] | South America [Member] | |||||||
Revenue | 30,000 | 583 | 30,000 | 583 | |||
License [Member] | EMEA [Member] | |||||||
Revenue | 55,100 | [1] | 96,850 | [1] | |||
License [Member] | Asia [Member] | |||||||
Revenue | 90,000 | 92,000 | |||||
Hardware [Member] | |||||||
Revenue | 344,769 | 625,069 | 781,056 | 1,226,249 | |||
Hardware [Member] | North America [Member] | |||||||
Revenue | 120,496 | 359,732 | 220,086 | 721,822 | |||
Hardware [Member] | South America [Member] | |||||||
Revenue | 53,040 | 2,011 | 53,040 | 2,341 | |||
Hardware [Member] | EMEA [Member] | |||||||
Revenue | [1] | 10,298 | 590 | 225,074 | 590 | ||
Hardware [Member] | Asia [Member] | |||||||
Revenue | 160,935 | 262,736 | 282,856 | 501,496 | |||
Maintenance [Member] | |||||||
Revenue | 241,121 | 123,861 | 441,720 | 263,949 | |||
Maintenance [Member] | North America [Member] | |||||||
Revenue | 225,602 | 114,275 | 403,518 | 247,701 | |||
Maintenance [Member] | South America [Member] | |||||||
Revenue | 16 | 176 | 16 | 245 | |||
Maintenance [Member] | EMEA [Member] | |||||||
Revenue | [1] | 12,503 | 9,100 | 21,216 | 15,295 | ||
Maintenance [Member] | Asia [Member] | |||||||
Revenue | 3,000 | 310 | 16,970 | 708 | |||
Professional Services [Member] | |||||||
Revenue | 8,000 | 10,200 | 109,850 | 190,700 | |||
Professional Services [Member] | North America [Member] | |||||||
Revenue | 6,000 | 4,800 | 107,850 | 185,300 | |||
Professional Services [Member] | South America [Member] | |||||||
Revenue | |||||||
Professional Services [Member] | EMEA [Member] | |||||||
Revenue | 2,000 | [1] | 2,000 | [1] | |||
Professional Services [Member] | Asia [Member] | |||||||
Revenue | $ 5,400 | $ 5,400 | |||||
[1] | EMEA - Europe, Middle East, Africa |
Note 3 - Revenue From Contrac32
Note 3 - Revenue From Contracts With Customers - Adoption of ASC 606 (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Jan. 01, 2018 | Dec. 31, 2017 | |
Capitalized contract assets | $ 341,622 | $ 341,622 | $ 240,017 | |||
Total assets | 12,603,719 | 12,603,719 | 16,318,839 | 16,078,822 | ||
Accumulated deficit | (70,683,931) | (70,683,931) | (66,836,475) | (67,076,492) | ||
TOTAL STOCKHOLDERS’ EQUITY | 11,460,527 | 11,460,527 | 13,993,312 | 13,753,295 | ||
Total Liabilities and Stockholders’ Equity | 12,603,719 | 12,603,719 | 16,318,839 | $ 16,078,822 | ||
Selling, general and administrative | 1,076,184 | $ 1,431,208 | 2,538,038 | $ 3,051,358 | ||
Net loss | (1,655,465) | (1,789,329) | (3,847,456) | (3,145,516) | ||
Net loss available to common stockholders | $ (1,697,335) | $ (1,989,954) | $ (4,045,489) | $ (3,546,766) | ||
Basic and Diluted Loss per Common Share (in dollars per share) | $ (0.15) | $ (0.32) | $ (0.42) | $ (0.57) | ||
Change in contract assets | $ (101,605) | |||||
Net cash provided by operating activities | 98,976 | $ (851,935) | ||||
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||||||
Capitalized contract assets | ||||||
Selling, general and administrative | 1,052,439 | 2,639,643 | ||||
Net loss | (1,631,720) | (3,949,061) | ||||
Net loss available to common stockholders | $ (1,673,590) | $ (4,147,094) | ||||
Basic and Diluted Loss per Common Share (in dollars per share) | $ (0.15) | $ (0.43) | ||||
Change in contract assets | ||||||
Net cash provided by operating activities | 98,976 | |||||
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | ||||||
Capitalized contract assets | $ (341,622) | (341,622) | ||||
Selling, general and administrative | (23,745) | 101,605 | ||||
Net loss | 23,745 | (101,605) | ||||
Net loss available to common stockholders | $ 23,745 | $ (101,605) | ||||
Basic and Diluted Loss per Common Share (in dollars per share) | $ 0 | $ (0.01) | ||||
Change in contract assets | $ 101,605 | |||||
Net cash provided by operating activities | ||||||
Accounting Standards Update 2014-09 [Member] | ||||||
Capitalized contract assets | 240,017 | |||||
Total assets | 240,017 | |||||
Accumulated deficit | 240,017 | |||||
TOTAL STOCKHOLDERS’ EQUITY | 240,017 | |||||
Total Liabilities and Stockholders’ Equity | $ 240,017 |
Note 4 - Accounts Receivable (D
Note 4 - Accounts Receivable (Details Textual) - USD ($) | 6 Months Ended | |
Jun. 30, 2018 | Dec. 31, 2017 | |
Allowance for Doubtful Accounts Receivable, Noncurrent | $ 1,000,000 | $ 1,000,000 |
Percentage of Remaining Balance Owned Reserved | 58.00% |
Note 4 - Accounts Receivable -
Note 4 - Accounts Receivable - Summary of Accounts Receivable (Details) - USD ($) | Jun. 30, 2018 | Dec. 31, 2017 |
Accounts receivable - current | $ 505,436 | $ 2,889,731 |
Accounts receivable - non current | 1,720,000 | 1,760,000 |
Total accounts receivable | 2,225,436 | 4,649,731 |
Allowance for doubtful accounts - current | (13,785) | (13,785) |
Allowance for doubtful accounts - non current | (1,000,000) | (1,000,000) |
Total allowance for doubtful accounts | (1,013,785) | (1,013,785) |
Accounts receivable, net of allowance for doubtful accounts | $ 1,211,651 | $ 3,635,946 |
Note 5 - Share Based Compensa35
Note 5 - Share Based Compensation - Expenses for Continuing Operations (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Share-based compensation expense | $ 149,542 | $ 413,194 | $ 699,475 | $ 574,283 |
Selling, General and Administrative Expenses [Member] | ||||
Share-based compensation expense | 128,620 | 394,264 | 599,766 | 507,120 |
Research and Development Expense [Member] | ||||
Share-based compensation expense | $ 20,922 | $ 18,930 | $ 99,709 | $ 67,163 |
Note 6 - Factoring (Details Tex
Note 6 - Factoring (Details Textual) | 1 Months Ended |
Dec. 31, 2011USD ($) | |
Factoring Arrangement, Minimum Amount of Accounts Receivable Per Quarter | $ 150,000 |
Minimum [Member] | |
Factoring Fees Percent | 2.75% |
Maximum [Member] | |
Factoring Fees Percent | 15.00% |
Geographic Distribution, Foreign [Member] | |
Percentage Of Accounts Receivable Remitted By Factor | 35.00% |
Geographic Distribution, Domestic [Member] | |
Percentage Of Accounts Receivable Remitted By Factor | 75.00% |
Note 6 - Factoring - Due From F
Note 6 - Factoring - Due From Factor (Details) - USD ($) | Jun. 30, 2018 | Dec. 31, 2017 |
Original invoice value | $ 118,494 | $ 423,349 |
Factored amount | (90,831) | (313,484) |
Due from factor | $ 27,663 | $ 109,865 |
Note 6 - Factoring - Fees (Deta
Note 6 - Factoring - Fees (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Factoring fees | $ 12,691 | $ 85,326 | $ 104,214 | $ 133,717 |
Note 7 - Inventory - Components
Note 7 - Inventory - Components of Inventory (Details) - USD ($) | Jun. 30, 2018 | Dec. 31, 2017 |
Finished goods | $ 408,984 | $ 487,858 |
Fabricated assemblies | 521,494 | 458,989 |
Total inventory | $ 930,478 | $ 946,847 |
Note 8 - Resalable Software L40
Note 8 - Resalable Software License Rights (Details Textual) - USD ($) | Dec. 31, 2015 | Nov. 11, 2015 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2018 | Dec. 31, 2017 |
Software License Rights, Current | $ 2,820,000 | $ 2,820,000 | $ 2,820,000 | $ 2,820,000 | $ 2,640,000 | ||||
Amortization of Intangible Assets, Total | 8,966 | $ 6,833 | |||||||
Software License Rights | 9,245,706 | $ 9,245,706 | 9,245,706 | 9,245,706 | $ 10,573,808 | ||||
Licensing Agreements [Member] | |||||||||
Payments to Acquire Intangible Assets | $ 12,000,000 | ||||||||
Finite-Lived Intangible Asset, Useful Life | 10 years | ||||||||
Amortization of Intangible Assets, Total | 660,000 | $ 390,000 | $ 1,320,000 | 778,092 | 2,878,596 | ||||
Software License Rights | 9,121,404 | 9,121,404 | 9,121,404 | 9,121,404 | |||||
Software License Rights [Member] | |||||||||
Amortization of Intangible Assets, Total | 20,642 | $ 22,020 | 8,102 | $ 28,716 | 55,698 | ||||
Software License Rights | $ 124,302 | 124,302 | $ 124,302 | $ 124,302 | |||||
Payments to Acquire Software | $ 180,000 | ||||||||
Amortization of Intangible Assets, Credits | $ 14,400 |
Note 8 - Resalable Software L41
Note 8 - Resalable Software License Rights - Summary of Software License Rights (Details) - USD ($) | Jun. 30, 2018 | Dec. 31, 2017 |
Resalable software license rights | $ 2,820,000 | $ 2,640,000 |
Resalable software license rights, net of current portion | 6,425,706 | 7,933,808 |
Total resalable software license rights | $ 9,245,706 | $ 10,573,808 |
Note 9 - Earnings (Loss) Per 42
Note 9 - Earnings (Loss) Per Share - Common Stock ("EPS") - Reconciliation of Numerator of Basic and Diluted EPS Calculations (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Net loss | $ (1,655,465) | $ (1,789,329) | $ (3,847,456) | $ (3,145,516) |
Convertible preferred stock dividends | (41,870) | (200,625) | (198,033) | (401,250) |
Net loss available to common stockholders | $ (1,697,335) | $ (1,989,954) | $ (4,045,489) | $ (3,546,766) |
Note 9 - Earnings (Loss) Per 43
Note 9 - Earnings (Loss) Per Share - Common Stock ("EPS") - Securities Excluded From the Diluted Per Share Calculation (Details) - shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Exercise Price Less Than Average Market Price Of Common Shares [Member] | ||||
Antidilutive securities (in shares) | 1,237,782 | 5,455,377 | 2,873,376 | 5,464,583 |
Exercise Price Less Than Average Market Price Of Common Shares [Member] | Preferred Stock [Member] | ||||
Antidilutive securities (in shares) | 1,200,767 | 5,416,667 | 2,853,513 | 5,416,667 |
Exercise Price Less Than Average Market Price Of Common Shares [Member] | Employee Stock Option [Member] | ||||
Antidilutive securities (in shares) | 37,015 | 35,706 | 19,863 | 44,580 |
Exercise Price Less Than Average Market Price Of Common Shares [Member] | Warrant [Member] | ||||
Antidilutive securities (in shares) | 3,004 | 3,336 | ||
Exercise Price Greater Than Average Market Price Of Common Shares [Member] | ||||
Antidilutive securities (in shares) | 2,765,436 | 1,430,924 | 2,844,860 | 1,430,924 |
Exercise Price Greater Than Average Market Price Of Common Shares [Member] | Employee Stock Option [Member] | ||||
Antidilutive securities (in shares) | 1,366,467 | 218,761 | 1,445,891 | 218,761 |
Exercise Price Greater Than Average Market Price Of Common Shares [Member] | Warrant [Member] | ||||
Antidilutive securities (in shares) | 1,398,969 | 1,212,163 | 1,398,969 | 1,212,163 |
Note 10 - Stockholders' Equit44
Note 10 - Stockholders' Equity (Details Textual) - USD ($) | May 31, 2018 | May 23, 2018 | May 14, 2018 | May 10, 2018 | Apr. 03, 2018 | Mar. 28, 2018 | Mar. 23, 2018 | Nov. 11, 2015 | Oct. 29, 2015 | Sep. 23, 2015 | Nov. 13, 2014 | May 31, 2018 | Apr. 30, 2018 | Mar. 31, 2018 | Oct. 31, 2017 | Sep. 30, 2017 | May 23, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | May 31, 2018 | Dec. 31, 2017 |
Preferred Stock, Shares Authorized | 5,000,000 | 5,000,000 | |||||||||||||||||||||
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | |||||||||||||||||||||
Stock Issued During Period, Shares, Conversion of Convertible Securities | 1,794,191 | ||||||||||||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 3.60 | ||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 0 | ||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Fair Value Amount | $ 381,876 | ||||||||||||||||||||||
Employee Stock Option [Member] | |||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate | 2.56% | ||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term | 4 years 182 days | ||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Dividend Rate | 0.00% | ||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate | 143.00% | ||||||||||||||||||||||
Promissory Note [Member] | |||||||||||||||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 69,445 | ||||||||||||||||||||||
Private Investor SPA [Member] | |||||||||||||||||||||||
Stock Issued During Period, Shares, New Issues | 664,584 | ||||||||||||||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 996,877 | ||||||||||||||||||||||
Proceeds from Issuance of Private Placement | $ 1,595,000 | ||||||||||||||||||||||
Term Of Warrant | 5 years | ||||||||||||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 3.60 | ||||||||||||||||||||||
Director [Member] | |||||||||||||||||||||||
Stock Issued During Period, Shares, Issued for Services | 648 | 2,035 | 762 | 7,659 | |||||||||||||||||||
Stock Issued During Period, Value, Issued for Services | $ 1,501 | $ 15,011 | |||||||||||||||||||||
Six Non-Employee Members of the Board of Directors [Member] | |||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 9,000 | ||||||||||||||||||||||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ 1.96 | ||||||||||||||||||||||
Six Non-Employee Members of the Board of Directors [Member] | Employee Stock Option [Member] | |||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 3 years | ||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period | 7 years | ||||||||||||||||||||||
Certain Officers, Employees, and Contractors [Member] | |||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 212,918 | ||||||||||||||||||||||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ 1.96 | ||||||||||||||||||||||
Certain Officers, Employees, and Contractors [Member] | Employee Stock Option [Member] | |||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 3 years | ||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period | 7 years | ||||||||||||||||||||||
Conversion of Series A-1 Shares into Common Stock [Member] | |||||||||||||||||||||||
Conversion of Stock, Shares Issued | 2,500,000 | ||||||||||||||||||||||
Conversion of Dividends Payable on Series A-1 Preferred Stock to Common Stock [Member] | |||||||||||||||||||||||
Conversion of Dividends Payable, Shares Issued | 248,893 | ||||||||||||||||||||||
Conversion of Dividends Payable, Amount Converted | $ 356,015 | $ 896,015 | |||||||||||||||||||||
Stock Issued During Period, Shares, Conversion of Convertible Securities | 660,073 | 1,177,598 | |||||||||||||||||||||
Conversion of Series B-1 Shares into Common Stock [Member] | |||||||||||||||||||||||
Conversion of Stock, Shares Issued | 2,916,668 | ||||||||||||||||||||||
Conversion of Dividends Payable on Series B-1 Preferred Stock to Common Stock [Member] | |||||||||||||||||||||||
Conversion of Dividends Payable, Shares Issued | 131,230 | ||||||||||||||||||||||
Conversion of Dividends Payable, Amount Converted | $ 472,426 | $ 472,426 | |||||||||||||||||||||
Stock Issued During Period, Shares, Conversion of Convertible Securities | 1,253,707 | ||||||||||||||||||||||
Series A-1 Convertible Preferred Stock [Member] | |||||||||||||||||||||||
Preferred Stock, Shares Authorized | 100,000 | 100,000 | 100,000 | ||||||||||||||||||||
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||||||||||||||||
Preferred Stock, Shares Issued, Total | 0 | 0 | 62,596 | ||||||||||||||||||||
Stock Issued During Period, Shares, New Issues | 5,500 | 84,500 | |||||||||||||||||||||
Share Price | $ 100 | $ 100 | |||||||||||||||||||||
Proceeds from Issuance of Convertible Preferred Stock | $ 550,000 | $ 8,450,000 | |||||||||||||||||||||
Initial Conversion Price | $ 3.60 | ||||||||||||||||||||||
Conversion Cap | 35.00% | ||||||||||||||||||||||
Preferred Stock, Dividend Rate, Percentage | 6.00% | ||||||||||||||||||||||
Period Preceding the Dividend Payment Date | 10 days | ||||||||||||||||||||||
Liquidation Value Per Share | $ 100 | ||||||||||||||||||||||
Conversion of Dividends Payable, Amount Converted | $ 25,463 | $ 330,552 | $ 540,000 | ||||||||||||||||||||
Preferred Stock, Shares Outstanding, Ending Balance | 0 | 0 | 62,596 | ||||||||||||||||||||
Series A-1 Convertible Preferred Stock [Member] | Maximum [Member] | |||||||||||||||||||||||
Maximum Ownership as a Result of Conversion | 9.99% | ||||||||||||||||||||||
Series B-1 Convertible Preferred Stock [Member] | |||||||||||||||||||||||
Preferred Stock, Shares Authorized | 105,000 | 105,000 | 105,000 | ||||||||||||||||||||
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||||||||||||||||
Preferred Stock, Shares Issued, Total | 0 | 0 | 105,000 | ||||||||||||||||||||
Stock Issued During Period, Shares, New Issues | 105,000 | ||||||||||||||||||||||
Share Price | $ 100 | ||||||||||||||||||||||
Proceeds from Issuance of Convertible Preferred Stock | $ 10,500,000 | ||||||||||||||||||||||
Initial Conversion Price | $ 3.60 | ||||||||||||||||||||||
Preferred Stock, Dividend Rate, Percentage | 2.50% | ||||||||||||||||||||||
Period Preceding the Dividend Payment Date | 10 days | ||||||||||||||||||||||
Liquidation Value Per Share | $ 100 | ||||||||||||||||||||||
Equity Facility, Aggregate Sales Limitation, Percentage of Total Outstanding Share | 19.99% | ||||||||||||||||||||||
Conversion of Dividends Payable, Amount Converted | $ 55,342 | $ 417,084 | |||||||||||||||||||||
Preferred Stock, Shares Outstanding, Ending Balance | 0 | 0 | 105,000 | ||||||||||||||||||||
Series B-1 Convertible Preferred Stock [Member] | Maximum [Member] | |||||||||||||||||||||||
Maximum Ownership as a Result of Conversion | 9.99% | ||||||||||||||||||||||
September 2015 Warrants [Member] | |||||||||||||||||||||||
Term Of Warrant | 5 years | ||||||||||||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 3.60 |
Note 10 - Stockholders' Equit45
Note 10 - Stockholders' Equity - Balances and Conversion of Preferred Shares and Accrued Dividends (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||||||||
May 31, 2018 | Apr. 30, 2018 | Mar. 31, 2018 | Oct. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Balance | $ 401,250 | ||||||||||||
Balance | $ 198,033 | $ 401,250 | $ 198,033 | $ 401,250 | |||||||||
Series A-1 Convertible Preferred Stock [Member] | |||||||||||||
Balance (in shares) | 62,596 | 90,000 | 62,596 | 90,000 | |||||||||
Balance | $ 236,658 | $ 270,000 | $ 236,658 | $ 270,000 | |||||||||
Accrual of dividends | $ 25,463 | $ 93,894 | $ 101,658 | 135,000 | 135,000 | $ 135,000 | |||||||
Conversion into common stock (in shares) | (23,508) | (39,088) | (27,404) | ||||||||||
Conversion into common stock | $ (25,463) | $ (330,552) | $ (540,000) | ||||||||||
Balance (in shares) | 62,596 | ||||||||||||
Balance | $ 236,658 | ||||||||||||
Series B-1 Convertible Preferred Stock [Member] | |||||||||||||
Balance (in shares) | 105,000 | 105,000 | 105,000 | 105,000 | |||||||||
Balance | $ 393,750 | $ 131,250 | $ 393,750 | $ 131,250 | |||||||||
Accrual of dividends | $ 16,408 | $ 62,268 | $ 65,625 | $ 65,625 | $ 65,625 | $ 65,625 | |||||||
Conversion into common stock (in shares) | (44,580) | (60,420) | |||||||||||
Conversion into common stock | $ (55,342) | $ (417,084) | |||||||||||
Balance (in shares) | 105,000 | ||||||||||||
Balance | $ 393,750 |
Note 11 - Segment Information (
Note 11 - Segment Information (Details Textual) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Number of Reportable Segments | 1 | |||
Geographic Concentration Risk [Member] | Sales Revenue, Net [Member] | North America [Member] | ||||
Concentration Risk, Percentage | 56.00% | 58.00% | 54.00% | 73.00% |
Note 13 - Major Customers and47
Note 13 - Major Customers and Accounts Receivable (Details Textual) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2018USD ($) | Jun. 30, 2017 | Jun. 30, 2018USD ($) | Jun. 30, 2017 | Dec. 31, 2017USD ($) | |
Allowance for Doubtful Accounts Receivable, Noncurrent | $ 1,000,000 | $ 1,000,000 | $ 1,000,000 | ||
Percentage of Remaining Balance Owned Reserved | 58.00% | ||||
Customer Concentration Risk [Member] | Sales Revenue, Net [Member] | |||||
Concentration Risk, Number of Major Customers | 2 | 3 | 2 | 3 | |
Customer Concentration Risk [Member] | Sales Revenue, Net [Member] | Two Customers [Member] | |||||
Concentration Risk, Percentage | 34.00% | 37.00% | |||
Customer Concentration Risk [Member] | Sales Revenue, Net [Member] | Three Customers [Member] | |||||
Concentration Risk, Percentage | 52.00% | 44.00% | |||
Customer Concentration Risk [Member] | Current Accounts Receivable [Member] | |||||
Concentration Risk, Number of Major Customers | 4 | 1 | |||
Customer Concentration Risk [Member] | Current Accounts Receivable [Member] | Four Customers [Member] | |||||
Concentration Risk, Percentage | 53.00% | ||||
Customer Concentration Risk [Member] | Current Accounts Receivable [Member] | One Customer [Member] | |||||
Concentration Risk, Percentage | 55.00% | ||||
Customer Concentration Risk [Member] | Non-current Accounts Receivable [Member] | |||||
Concentration Risk, Number of Major Customers | 1 | 1 | |||
Customer Concentration Risk [Member] | Non-current Accounts Receivable [Member] | One Customer [Member] | |||||
Concentration Risk, Percentage | 100.00% | 100.00% |
Note 14 - Subsequent Events (De
Note 14 - Subsequent Events (Details Textual) - Director [Member] - shares | Aug. 09, 2018 | May 14, 2018 | May 10, 2018 | Mar. 28, 2018 | Mar. 23, 2018 |
Stock Issued During Period, Shares, Issued for Services | 648 | 2,035 | 762 | 7,659 | |
Subsequent Event [Member] | |||||
Stock Issued During Period, Shares, Issued for Services | 3,282 |