Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2013 | Nov. 08, 2013 | |
Document and Entity Information [Abstract] | ' | ' |
Entity Registrant Name | 'hopTo Inc. | ' |
Entity Central Index Key | '0001021435 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Well-known Seasoned Issuer | 'No | ' |
Entity Voluntary Filers | 'No | ' |
Entity Current Reporting Status | 'Yes | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Entity Common Stock, Shares Outstanding | ' | 101,459,382 |
Document Fiscal Year Focus | '2013 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 30-Sep-13 | ' |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (Unaudited) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Current Assets: | ' | ' |
Cash | $3,557,100 | $3,960,600 |
Accounts receivable, net | 700,400 | 865,900 |
Prepaid expenses | 62,400 | 150,200 |
Total Current Assets | 4,319,900 | 4,976,700 |
Capitalized software development costs, net | 659,600 | 223,100 |
Property and equipment, net | 357,800 | 358,900 |
Other assets | 31,700 | 46,900 |
Total Assets | 5,369,000 | 5,605,600 |
Current Liabilities: | ' | ' |
Accounts payable and accrued expenses | 969,400 | 739,100 |
Deferred revenue | 2,638,200 | 2,921,600 |
Severance liability | 140,100 | 209,500 |
Deferred rent | 29,800 | 26,700 |
Total Current Liabilities | 3,777,500 | 3,896,900 |
Warrants liability | 1,968,800 | 7,390,100 |
Deferred revenue | 476,700 | 570,400 |
Severance liability | 0 | 52,900 |
Deferred rent | 104,500 | 127,500 |
Total Liabilities | 6,327,500 | 12,037,800 |
Commitments and contingencies | ' | ' |
Stockholders' (Deficit): | ' | ' |
Preferred stock, $0.01 par value, 5,000,000 shares authorized, no shares issued and outstanding | 0 | 0 |
Common stock, $0.0001 par value, 195,000,000 shares authorized, 95,507,634 and 82,616,750 shares issued and outstanding at September 30, 2013 and December 31, 2012, respectively | 9,500 | 8,300 |
Additional paid-in capital | 70,748,100 | 62,425,400 |
Accumulated deficit | -71,716,100 | -68,865,900 |
Total Stockholders' Equity (Deficit) | -958,500 | -6,432,200 |
Total Liabilities and Stockholders' Equity (Deficit) | $5,369,000 | $5,605,600 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Stockholders' (Deficit): | ' | ' |
Preferred stock, par value (in dollars per share) | $0.01 | $0.01 |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $0.00 | $0.00 |
Common stock, shares authorized (in shares) | 195,000,000 | 195,000,000 |
Common stock, shares issued (in shares) | 95,507,634 | 82,616,750 |
Common stock, shares outstanding (in shares) | 95,507,634 | 82,616,750 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Operations (Unaudited) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Condensed Consolidated Statements of Operations (Unaudited) [Abstract] | ' | ' | ' | ' |
Revenue | $1,534,700 | $1,734,100 | $4,545,500 | $4,915,600 |
Costs of revenue | 100,500 | 160,700 | 349,600 | 431,600 |
Gross profit | 1,434,200 | 1,573,400 | 4,195,900 | 4,484,000 |
Operating expenses: | ' | ' | ' | ' |
Selling and marketing | 683,300 | 602,100 | 1,743,500 | 1,781,400 |
General and administrative | 914,900 | 677,500 | 2,441,600 | 3,162,300 |
Research and development | 1,444,500 | 948,600 | 3,533,300 | 2,966,500 |
Total operating expenses | 3,042,700 | 2,228,200 | 7,718,400 | 7,910,200 |
Loss from operations | -1,608,500 | -654,800 | -3,522,500 | -3,426,200 |
Other income (expense): | ' | ' | ' | ' |
Change in fair value of warrants liability | -639,100 | -3,025,700 | 680,100 | -2,417,800 |
Other, net | -200 | 1,600 | -500 | 5,100 |
Loss from continuing operations before provision for income tax | -2,247,800 | -3,678,900 | -2,842,900 | -5,838,900 |
Provision for income taxes | 4,600 | 600 | 7,300 | 2,600 |
Loss from continuing operations | -2,252,400 | -3,679,500 | -2,850,200 | -5,841,500 |
Loss from discontinued operations | 0 | -347,100 | 0 | -468,400 |
Net Loss | ($2,252,400) | ($4,026,600) | ($2,850,200) | ($6,309,900) |
Loss per share: | ' | ' | ' | ' |
Continuing operations - basic and diluted (in dollars per share) | ($0.02) | ($0.04) | ($0.03) | ($0.07) |
Discontinued operations - basic and diluted (in dollars per share) | $0 | ($0.01) | $0 | ($0.01) |
Basic and diluted loss per share (in dollars per share) | ($0.02) | ($0.05) | ($0.03) | ($0.08) |
Average weighted common share outstanding - basic and diluted (in shares) | 94,836,777 | 82,255,955 | 87,992,742 | 82,044,581 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Stockholders' (Deficit) (Unaudited) (USD $) | Preferred Stock [Member] | Common Stock [Member] | Additional Paid-In Capital [Member] | Accumulated Deficit [Member] | Total | |
USD ($) | USD ($) | USD ($) | USD ($) | |||
Balance at Dec. 31, 2011 | ' | $8,200 | $61,398,600 | ($60,689,200) | ' | |
Balance (in shares) at Dec. 31, 2011 | 0 | 81,886,926 | ' | ' | ' | |
Exercise of employee stock options | ' | 400 | ' | ' | ' | |
Employee stock option issuances (in shares) | ' | 567,176 | ' | ' | ' | |
Exercise of warrants | ' | 0 | ' | ' | ' | |
Exercise of warrants (in shares) | ' | 0 | ' | ' | ' | |
Vesting of restricted stock awards | ' | 0 | ' | ' | ' | |
Vesting of restricted stock awards (in shares) | ' | 0 | ' | ' | ' | |
Stock-based compensation expense | ' | ' | 521,600 | ' | ' | |
Stock-based compensation expense - severance agreement | ' | ' | 237,400 | ' | ' | |
Proceeds from exercise of employee stock options | ' | ' | 44,000 | ' | 44,400 | |
Proceeds from exercise of warrants | ' | ' | 0 | ' | 0 | |
Issuance of new warrants, per exercise agreement | ' | ' | 0 | ' | ' | |
New warants recorded as cost of exercise agreement | ' | ' | 0 | ' | ' | |
Issuance of new warrants, per offer to exercise | ' | ' | 0 | ' | ' | |
New warrants recorded as cost of offer to exercise | ' | ' | 0 | ' | ' | |
Accretion of compensation expense - consultant warrants | ' | ' | 0 | ' | ' | |
Reclassification of warrants liability to equity from the exercise of warrants | ' | ' | 0 | ' | ' | |
Reclassification of warrants liability to equity from amendment of warrants | ' | ' | 0 | ' | ' | |
Net loss | ' | ' | ' | -6,309,900 | -6,309,900 | |
Balance at Sep. 30, 2012 | ' | 8,600 | 62,201,600 | -66,999,100 | -4,788,900 | |
Balance (in shares) at Sep. 30, 2012 | 0 | 82,454,102 | ' | ' | ' | |
Balance at Dec. 31, 2012 | ' | 8,300 | 62,425,400 | -68,865,900 | -6,432,200 | |
Balance (in shares) at Dec. 31, 2012 | 0 | 82,616,750 | ' | ' | ' | |
Exercise of employee stock options | ' | 100 | ' | ' | ' | |
Employee stock option issuances (in shares) | ' | 1,459,972 | ' | ' | ' | |
Exercise of warrants | ' | 900 | ' | ' | ' | |
Exercise of warrants (in shares) | ' | 10,222,500 | ' | ' | ' | |
Vesting of restricted stock awards | ' | 200 | ' | ' | ' | |
Vesting of restricted stock awards (in shares) | ' | 1,208,412 | ' | ' | ' | |
Stock-based compensation expense | ' | ' | 617,000 | ' | ' | |
Stock-based compensation expense - severance agreement | ' | ' | 0 | ' | ' | |
Proceeds from exercise of employee stock options | ' | ' | 302,600 | ' | 302,700 | |
Proceeds from exercise of warrants | ' | ' | 2,614,400 | ' | 2,615,300 | |
Issuance of new warrants, per exercise agreement | ' | ' | 514,800 | ' | ' | |
New warants recorded as cost of exercise agreement | ' | ' | -514,800 | ' | ' | |
Issuance of new warrants, per offer to exercise | ' | ' | 45,600 | ' | ' | |
New warrants recorded as cost of offer to exercise | ' | ' | -45,600 | ' | ' | |
Accretion of compensation expense - consultant warrants | ' | ' | 11,800 | ' | ' | |
Reclassification of warrants liability to equity from the exercise of warrants | ' | ' | 385,900 | ' | -385,900 | [1] |
Reclassification of warrants liability to equity from amendment of warrants | ' | ' | 4,391,000 | ' | -4,391,000 | [1] |
Net loss | ' | ' | ' | -2,850,200 | -2,850,200 | |
Balance at Sep. 30, 2013 | ' | $9,500 | $70,748,100 | ($71,716,100) | ($958,500) | |
Balance (in shares) at Sep. 30, 2013 | 0 | 95,507,634 | ' | ' | ' | |
[1] | During the nine-month period ended September 30, 2013, our warrants liability was reduced as a result of the warrants amendment, as discussed above. Additionally, our warrants liability was further reduced by $385,900 as a result of the exercise of 1,072,500 warrants during such period, whose terms were not affected by the changes made under the warrants amendment. The aggregate reduction in the liability, combining the warrant amendment and this exercise, was $4,776,900. See Note 14. |
Condensed_Consolidated_Stateme2
Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $) | 9 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Cash Flows Provided By (Used In) Operating Activities: | ' | ' |
Net loss | ($2,850,200) | ($6,309,900) |
Loss from discontinued operations | 0 | 468,400 |
Adjustments to reconcile net loss to net cash used in operating activities: | ' | ' |
Depreciation and amortization | 187,700 | 191,700 |
Stock-based compensation expense | 580,500 | 759,000 |
Change in fair value of derivative instruments - warrants | -680,100 | 2,417,800 |
Accretion of warrants liability for consulting services | 35,700 | 52,700 |
Accretion of equity warrants for consulting services | 11,800 | 0 |
Revenue deferred to future periods | 2,725,500 | 3,832,300 |
Recognition of deferred revenue | -3,102,600 | -3,519,300 |
Changes in severance liability | -122,300 | 336,800 |
Changes in deferred rent | -19,900 | 32,000 |
Changes to allowance for doubtful accounts | -4,300 | 5,200 |
Loss on disposal of fixed assets | 0 | 600 |
Changes in operating assets and liabilities: | ' | ' |
Accounts receivable | 169,800 | -53,000 |
Prepaid expenses | 87,800 | 31,700 |
Accounts payable and accrued expenses | 226,600 | 56,600 |
Other assets | 15,200 | -7,500 |
Net Cash Used In Operating Activities - Continuing Operations | -2,738,800 | -1,704,900 |
Net Cash Used In Operating Activities - Discontinued Operations | 0 | -432,800 |
Net Cash Used in Operating Activities | -2,738,800 | -2,137,700 |
Cash Flows Used In Investing Activities: | ' | ' |
Capital expenditures | -75,800 | -269,800 |
Capitalized software development costs | -506,900 | 0 |
Net Cash Used In Investing Activities - Continuing Operations | -582,700 | -269,800 |
Net Cash Used In Investing Activities - Discontinued Operations | 0 | 0 |
Net Cash Used In Investing Activities | -582,700 | -269,800 |
Cash Flows Provided By Financing Activities: | ' | ' |
Proceeds from exercise of warrants | 2,615,300 | 0 |
Proceeds from exercise of employee stock options | 302,700 | 44,400 |
Increase in payables related to restricted cash | 0 | 198,300 |
Proceeds from restricted cash transaction | 0 | -198,300 |
Net Cash Provided By Financing Activities -Continuing Operations | 2,918,000 | 44,400 |
Net Cash Provided By Financing Activities - Discontinued Operations | 0 | 0 |
Net Cash Provided By Financing Activities | 2,918,000 | 44,400 |
Net Decrease in Cash | -403,500 | -2,363,100 |
Cash - Beginning of Period | 3,960,600 | 7,237,500 |
Cash - End of Period | $3,557,100 | $4,874,400 |
Basis_of_Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2013 | |
Basis of Presentation [Abstract] | ' |
Basis of Presentation | ' |
1. Basis of Presentation | |
Our Board of Directors adopted an amendment to our Certificate of Incorporation changing our name from GraphOn Corporation to hopTo Inc. effective September 9, 2013. A Certificate of Amendment of Incorporation was filed with the Delaware Secretary of State implementing the name change. The amendment had been previously approved by our stockholders. | |
The unaudited condensed consolidated financial statements include the accounts of hopTo Inc. and its subsidiaries (collectively, “we”, “us” or “our”); significant intercompany accounts and transactions are eliminated upon consolidation. The unaudited condensed consolidated financial statements included herein have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) applicable to interim financial information and the rules and regulations promulgated by the Securities and Exchange Commission (the “SEC”). Accordingly, such unaudited condensed consolidated financial statements do not include all information and footnote disclosures required in annual financial statements. | |
The unaudited condensed consolidated financial statements included herein reflect all adjustments, which include only normal, recurring adjustments, except for the effect of the amendment to warrants (Note 4), that are, in our opinion, necessary to state fairly the results for the periods presented. This Quarterly Report on Form 10-Q should be read in conjunction with our audited consolidated financial statements contained in our Annual Report, as amended, on Form 10-K/A for the year ended December 31, 2012, which was filed with the SEC on April 12, 2013 (“2012 10-K/A Report”). The interim results presented herein are not necessarily indicative of the results of operations that may be expected for the full fiscal year ending December 31, 2013 or any future period. | |
During September 2012, we reached settlement and licensing agreements that effectively ended all of our then on-going intellectual property litigation. Having been approached by the respective counter-parties to each of our lawsuits, and in consultation with our board of directors, we determined that it was in our best long-term strategic interests to settle each lawsuit in order to move forward and shift our focus to our software products, including our new product initiatives. We do not intend to pursue intellectual property litigation as an integral part of our strategy to fund our future operations. Accordingly for all periods presented, the results of operations and cash flows related to our former intellectual property segment has been segregated and reported as “Discontinued Operations”. See Note 17 to our Notes to Unaudited Condensed Consolidated Financial Statements. |
Significant_Accounting_Policie
Significant Accounting Policies | 9 Months Ended | ||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||
Significant Accounting Policies [Abstract] | ' | ||||||||||||||||||||
Significant Accounting Policies | ' | ||||||||||||||||||||
2. Significant Accounting Policies | |||||||||||||||||||||
Use of Estimates | |||||||||||||||||||||
The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. These estimates include: the amount of stock-based compensation expense; the allowance for doubtful accounts; the estimated lives, valuation, and amortization of intangible assets (including capitalized software); depreciation of long-lived assets; valuation of warrants; post-employment benefits, and accruals for liabilities. While we believe that such estimates are fair, actual results could differ materially from those estimates. | |||||||||||||||||||||
Revenue Recognition | |||||||||||||||||||||
We market and license our products indirectly through channel distributors, independent software vendors (“ISVs”), value-added resellers (“VARs”) (collectively, “resellers”) and directly to corporate enterprises, governmental and educational institutions and others. Our product licenses are perpetual. We also separately sell intellectual property licenses, maintenance contracts, which are comprised of license updates and customer service access, as well as other products and services. | |||||||||||||||||||||
Software license revenues are recognized when: | |||||||||||||||||||||
· | Persuasive evidence of an arrangement exists, (i.e., when we sign a non-cancellable license agreement wherein the customer acknowledges an unconditional obligation to pay, or upon receipt of the customer’s purchase order), and | ||||||||||||||||||||
· | Delivery has occurred or services have been rendered and there are no uncertainties surrounding product acceptance (i.e., when title and risk of loss have been transferred to the customer, which occurs when the media containing the licensed program(s) is provided to a common carrier or, in the case of electronic delivery, when the customer is given access to the licensed program(s)), and | ||||||||||||||||||||
· | The price to the customer is fixed or determinable, as typically evidenced in a signed non-cancellable contract, or a customer’s purchase order, and | ||||||||||||||||||||
· | Collectability is probable. If collectability is not considered probable, revenue is recognized when the fee is collected. | ||||||||||||||||||||
Revenue recognized on software arrangements involving multiple deliverables is allocated to each deliverable based on vendor-specific objective evidence (“VSOE”) or third party evidence of the fair values of each deliverable; such deliverables include licenses for software products, maintenance, private labeling fees, and customer training. We limit our assessment of VSOE for each deliverable to either the price charged when the same deliverable is sold separately or the price established by management having the relevant authority to do so, for a deliverable not yet sold separately. | |||||||||||||||||||||
If sufficient VSOE of the fair value does not exist so as to permit the allocation of revenue to the various elements of the arrangement, all revenue from the arrangement is deferred until such evidence exists or until all elements are delivered. If VSOE of the fair value does not exist, and the only undelivered element is maintenance, then we recognize revenue on a ratable basis. If VSOE of the fair value of all undelivered elements exists but does not exist for one or more delivered elements, then revenue is recognized using the residual method. Under the residual method, the fair value of the undelivered elements is deferred and the remaining portion of the arrangement fee is recognized as revenue. | |||||||||||||||||||||
Certain resellers (“stocking resellers”) purchase product licenses that they hold in inventory until they are resold to the ultimate end user (an “inventory stocking order”). At the time that a stocking reseller places an inventory stocking order, no product licenses are shipped by us to the stocking reseller; rather, the stocking reseller’s inventory is credited with the number of licenses purchased and the stocking reseller can resell (issue) any number of licenses from their inventory at any time. Upon receipt of an order to issue a license(s) from a stocking reseller’s inventory (a “draw down order”), we will ship the license(s) in accordance with the draw down order’s instructions. We defer recognition of revenue from inventory stocking orders until the underlying licenses are sold and shipped to the end user, as evidenced by the receipt and fulfillment of the stocking reseller’s draw down order, assuming all other revenue recognition criteria have been met. | |||||||||||||||||||||
There are no rights of return granted to resellers or other purchasers of our software products. | |||||||||||||||||||||
Revenue from maintenance contracts is recognized ratably over the related contract period, which generally ranges from one to five years. | |||||||||||||||||||||
All of our software licenses are denominated in U.S. dollars. | |||||||||||||||||||||
Deferred Rent | |||||||||||||||||||||
The lease for our office in Campbell, California, contains free rent and predetermined fixed escalations in our minimum rent payments. We recognize rent expense related to this lease on a straight-line basis over the term of the lease. We record any difference between the straight-line rent amounts and amounts payable under the lease as part of deferred rent in current or long-term liabilities, as appropriate. | |||||||||||||||||||||
Incentives that we received upon entering into the lease agreement are recognized on a straight-line basis as a reduction to rent over the term of the lease. We record the unamortized portion of these incentives as a part of deferred rent in current or long-term liabilities, as appropriate. | |||||||||||||||||||||
Postemployment Benefits (Severance Liability) | |||||||||||||||||||||
Nonretirement postemployment benefits, including salary continuation, supplemental unemployment benefits, severance benefits, disability-related benefits and continuation of benefits such as health care benefits, are recognized as a liability and a loss when it is probable that the employee(s) will be entitled to such benefits and the amount can be reasonably estimated. The cost of termination benefits recognized as a liability and an expense includes the amount of any lump-sum payments and the present value of any expected future payments. During 2012, we recorded $721,800 of severance expense, including stock compensation expense. Such expense was recorded as a result of a separation agreement and a release with Robert Dilworth in connection with Mr. Dilworth’s resignation as our Chief Executive Officer and as a member of our board of directors. In addition, during 2013 we recorded an additional $75,700 of severance expense as a result of a separation and release agreement we entered into with a former vice president-level employee (as further discussed in Note 5 to Unaudited Condensed Consolidated Financial Statements). An aggregate of $140,100 and $262,400 is reflected as a severance liability, at September 30, 2013 and December 31, 2012, respectively. | |||||||||||||||||||||
Software Development Costs | |||||||||||||||||||||
We capitalize software development costs incurred from the time technological feasibility of the software is established until the software is available for general release, in accordance with GAAP. Such capitalized costs are subsequently amortized as costs of revenue over the shorter of three years or the remaining estimated useful life of the product. | |||||||||||||||||||||
Research and development costs and other computer software maintenance costs related to the software development are expensed as incurred. | |||||||||||||||||||||
Long-Lived Assets | |||||||||||||||||||||
Long-lived assets are assessed for possible impairment whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable, whenever we have committed to a plan to dispose of the assets or, at a minimum, annually. Typically, for long-lived assets to be held and used, measurement of an impairment loss is based on the fair value of such assets, with fair value being determined based on appraisals, current market value, comparable sales value, and discounted future cash flows, among other variables, as appropriate. Assets to be held and used (which assets are affected by an impairment loss) are depreciated or amortized at their new carrying amount over their remaining estimated life; assets to be sold or otherwise disposed of are not subject to further depreciation or amortization. No such impairment charge was recorded during either of the three or nine-month periods ended September 30, 2013 or 2012. | |||||||||||||||||||||
Allowance for Doubtful Accounts | |||||||||||||||||||||
We maintain an allowance for doubtful accounts that reflects our best estimate of potentially uncollectible trade receivables. The allowance is based on assessments of the collectability of specific customer accounts and the general aging and size of the accounts receivable. We regularly review the adequacy of our allowance for doubtful accounts by considering such factors as historical experience, credit worthiness, and current economic conditions that may affect a customer’s ability to pay. We specifically reserve for those accounts deemed uncollectible. We also establish, and adjust, a general allowance for doubtful accounts based on our review of the aging and size of our accounts receivable. | |||||||||||||||||||||
The following table sets forth the details of the Allowance for Doubtful Accounts for the three and nine-month periods ended September 30, 2013 and 2012: | |||||||||||||||||||||
Beginning Balance | Charge Offs | Recoveries | Provision | Ending Balance | |||||||||||||||||
Three Months Ended September 30, | |||||||||||||||||||||
2013 | $ | 24,600 | $ | — | $ | — | $ | 5,000 | $ | 29,600 | |||||||||||
2012 | 37,900 | — | — | (7,700 | ) | 30,200 | |||||||||||||||
Nine Months Ended September 30, | |||||||||||||||||||||
2013 | $ | 33,900 | $ | — | $ | — | $ | (4,300 | ) | $ | 29,600 | ||||||||||
2012 | 25,000 | — | — | 5,200 | 30,200 | ||||||||||||||||
Concentration of Credit Risk | |||||||||||||||||||||
For the three and nine-month periods ended September 30, 2013 and 2012 respectively, we considered the customers listed in the following tables to be our most significant customers. The tables set forth the percentage of sales attributable to each customer for the three and nine-month periods ended September 30, 2013 and 2012, and the respective customer’s ending accounts receivable balance as a percentage of reported accounts receivable, net, as of September 30, 2013 and 2012. | |||||||||||||||||||||
Three Months Ended | Three Months Ended | ||||||||||||||||||||
30-Sep-13 | 30-Sep-12 | ||||||||||||||||||||
Customer | Sales | Accounts Receivable | Sales | Accounts Receivable | |||||||||||||||||
Elosoft | 10.4 | % | 15.1 | % | 7.2 | % | 10.7 | % | |||||||||||||
IDS | 9.9 | % | 4.5 | % | 8.7 | % | 1.2 | % | |||||||||||||
GE | 9.7 | % | 16.5 | % | 10.1 | % | 19.8 | % | |||||||||||||
Alcatel-Lucent | 8.4 | % | 16.2 | % | 7.2 | % | 14.3 | % | |||||||||||||
GAD | 6.4 | % | — | 5.5 | % | — | |||||||||||||||
Total | 44.8 | % | 52.3 | % | 38.7 | % | 46 | % | |||||||||||||
Nine Months Ended | Nine Months Ended | ||||||||||||||||||||
30-Sep-13 | 30-Sep-12 | ||||||||||||||||||||
Customer | Sales | Accounts Receivable | Sales | Accounts Receivable | |||||||||||||||||
Elosoft | 6.3 | % | 15.1 | % | 5.5 | % | 10.7 | % | |||||||||||||
IDS | 6.6 | % | 4.5 | % | 5.4 | % | 1.2 | % | |||||||||||||
GE | 6.8 | % | 16.5 | % | 8.1 | % | 19.8 | % | |||||||||||||
Alcatel-Lucent | 7.5 | % | 16.2 | % | 4.8 | % | 14.3 | % | |||||||||||||
GAD | 4.7 | % | — | 10.5 | % | — | |||||||||||||||
Total | 31.9 | % | 52.3 | % | 34.3 | % | 46 | % | |||||||||||||
Derivative Financial Instruments | |||||||||||||||||||||
We currently do not have a material exposure to either commodity prices or interest rates; accordingly, we do not currently use derivative instruments to manage such risks. We evaluate all of our financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. All derivative financial instruments are recognized in the balance sheet at fair value. Changes in fair value are recognized in earnings if they are not eligible for hedge accounting or in other comprehensive income if they qualify for cash flow hedge accounting. | |||||||||||||||||||||
Fair Value of Financial Instruments | |||||||||||||||||||||
The fair value of our accounts receivable, accounts payable and accrued liabilities approximate their carrying amounts due to the relative short maturities of these items. | |||||||||||||||||||||
The fair value of warrants at issuance and for those recorded as a liability at each reporting date are determined in accordance with the Financial Account Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) 820, “Fair Value Measurement,” which establishes a fair value hierarchy that prioritizes the assumptions (inputs) to valuation techniques used to price assets or liabilities that are measured at fair value. The hierarchy, as defined below, gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The guidance for fair value measurements requires that assets, liabilities and certain equity instruments measured at fair value be classified and disclosed in one of the following categories: | |||||||||||||||||||||
· | Level 1: Defined as observable inputs, such as quoted (unadjusted) prices in active markets for identical assets or liabilities. | ||||||||||||||||||||
· | Level 2: Defined as observable inputs other than quoted prices included in Level 1. This includes quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | ||||||||||||||||||||
· | Level 3: Defined as unobservable inputs to the valuation methodology that are supported by little or no market activity and that are significant to the measurement of the fair value of the assets or liabilities. Level 3 assets and liabilities include those whose fair value measurements are determined using pricing models, discounted cash flow methodologies or similar valuation techniques, as well as significant management judgment or estimation. | ||||||||||||||||||||
As of September 30, 2013, all of our $1,968,800 Warrants Liability reported at fair value was categorized as Level 3 inputs (See Note 4). | |||||||||||||||||||||
Recent Accounting Pronouncements | |||||||||||||||||||||
In July 2013, FASB issued ASU No. 2013-11 “Income Taxes (Topic 740)” (ASU 2013-11). The objective of ASU 2013-11 is to provide explicit guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. FASB recognized that there was inconsistency in how previous guidance in this topic was applied in practice, thus; the objective of ASU 2013-11 is to eliminate the diversity of how previous guidance was applied. As the amendments in ASU 2013-11 do not require new recurring disclosures, rather, they are aimed at creating consistency in how previous guidance is applied, we do not believe that adoption of ASU 2013-11, which will become effective for fiscal years, and interim periods within those years, beginning after December 15, 2013, will have a material impact on our results of operations, cash flows or financial position. | |||||||||||||||||||||
In February 2013, FASB issued ASU No. 2013-02 “Other Comprehensive Income” (ASU 2013-02). The objective of ASU 2013-02 is to improve the reporting of reclassifications out of other comprehensive income. This objective is reached by requiring an entity to report the effect of significant reclassifications out of accumulated other comprehensive income on the respective line items in net income if the amount being reclassified is required under GAAP to be reclassified in its entirety to net income. ASU 2013-02 is effective and is to be applied prospectively to reporting periods beginning after December 15, 2012. We currently have no amounts that would meet the criteria to be reclassified; accordingly, the adoption of ASU 2013-02 did not have a material impact on our results of operations, cash flows or financial position. Comprehensive loss equals net loss for the each of the three and nine-month periods ended September 30, 2013 and 2012, respectively. | |||||||||||||||||||||
In July 2012, FASB issued ASU No. 2012-02 “Intangibles – Goodwill and Other” (ASU 2012-02). The objective of ASU 2012-02 is to reduce the cost and complexity of performing an impairment test for indefinite-lived intangible assets by simplifying how an entity tests those assets for impairment and to improve consistency in impairment testing guidance among long-lived asset categories. ASU 2012-02 is effective for fiscal years beginning after September 15, 2012. Early adoption is permitted. We currently have no goodwill or material indefinite-lived intangible assets; accordingly, the adoption of ASU 2012-02 did not have a material impact on our results of operations, cash flows or financial position. | |||||||||||||||||||||
Property_and_Equipment
Property and Equipment | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Property and Equipment [Abstract] | ' | ||||||||
Property and Equipment | ' | ||||||||
3. Property and Equipment | |||||||||
Property and equipment was: | |||||||||
30-Sep-13 | 31-Dec-12 | ||||||||
Equipment | $ | 1,238,800 | $ | 1,171,900 | |||||
Furniture | 392,800 | 380,200 | |||||||
Leasehold improvements | 147,500 | 147,500 | |||||||
1,779,100 | 1,699,600 | ||||||||
Less: accumulated depreciation and amortization | 1,421,300 | 1,340,700 | |||||||
$ | 357,800 | $ | 358,900 | ||||||
Aggregate property and equipment depreciation and amortization expense was $28,200 during the three-month period ended September 30, 2013 and $80,600 during the nine-month period ended September 30, 2013. During the nine-month period ended September 30, 2013, we capitalized the following costs: equipment; $64,900, furniture; $14,600. | |||||||||
Liability_Attributable_to_Warr
Liability Attributable to Warrants | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Liability Attributable to Warrants [Abstract] | ' | ||||||||||||||||
Liability Attributable to Warrants | ' | ||||||||||||||||
4. Liability Attributable to Warrants | |||||||||||||||||
On June 17, 2013, we entered into, and subsequently consummated, an Exercise Agreement (the “Exercise Agreement”) with five of the largest investors in our September 1, 2011 private placement of common stock and warrants (the “2011 Transaction”), providing for the exercise for cash by such investors of warrants to purchase an aggregate of 9 million shares of our common stock, out of the approximately 17 million shares of common stock subject to warrants issued to the investors in the 2011 Transaction that remained outstanding as of such date. The approximately 5 million shares of common stock subject to warrants issued to the placement agent in the 2011 Transaction that remained outstanding as of such date were not part of the Exercise Agreement. The Company agreed under the Exercise Agreement to subsequently commence a tender offer (the “Offer to Exercise”) to provide these holders of other warrants that remained outstanding from the 2011 Transaction with the same opportunity to exercise as provided under the Exercise Agreement. | |||||||||||||||||
The warrants exercised had a remaining term of approximately 38 months, and had an exercise price of $0.26 per warrant, which was the original exercise price. We received cash proceeds of $2.34 million as a result of the warrants exercised. In consideration for the early exercise of these warrants, we issued to the five investors an aggregate of 4.5 million warrants to purchase common stock at an exercise price of $1.00 per warrant, with a term of five years from issuance (the “New Warrants”). The New Warrants were issued on June 18, 2013, are substantially similar to the investor warrants that were exercised, and, after giving effect to the amendments to such warrants described below, such warrants have been recorded as a component of equity (additional paid-in capital “APIC”) at Level 3 fair value. | |||||||||||||||||
Using a binomial pricing model, we calculated the fair value of the New Warrants issued at the time of the Exercise Agreement to be $514,800. We used the following assumptions in the binomial pricing model: estimated volatility – 185%; annualized forfeiture rate – 0%; expected term – 5 years; estimated exercise factor – 1.5, risk free interest rate – 1.07%; and dividends – 0. The New Warrants were accounted for as a cost of the exercise of the warrants issued pursuant to the Exercise Agreement; as a result a $514,800 reduction of APIC was also recorded. Accordingly, there was no net effect on equity because of the issuance of the new warrants. | |||||||||||||||||
Immediately prior to the exercise for cash, the five investors, who held a majority of the outstanding warrants issued in the 2011 Transaction to investors (“Investor Warrants”), agreed to amend the entire series of such warrants to delete the following provisions: (1) the price-based anti-dilution clause; (2) our right to lower the exercise price in our discretion; and (3) a clause that mandated that we buy the warrants for cash at their Black-Scholes value in the event of certain extraordinary transactions. By virtue of a majority-rule clause in the warrants, the elimination of these provisions from the Investor Warrants issued in the 2011 Transaction eliminated the warrant derivative liability classification related to all of the Investor Warrants issued in the 2011 Transaction including those held by investors who did not exercise their warrants at the date of the amendment. The tables below show the calculation of the reduction of the warrants derivative liability. | |||||||||||||||||
The warrants issued to the placement agent and to an intellectual property consulting firm (ipCapital Group, Inc.) were not included in the Exercise Agreement or affected by the amendment described above. The exercise price of such warrants could, in certain circumstances, be reset to below-market value. Accordingly, unlike the amended investor warrants, we have concluded that the warrants issued to the placement agent and ipCapital Group, Inc. are not indexed to our common stock; therefore, the fair value of these warrants were, and continue to be, recorded as a liability. | |||||||||||||||||
On August 9, 2013, we consummated an offer to exercise warrants (the “Offer to Exercise”) made to holders of warrants in the 2011 Transaction who were not parties to the Exercise Agreement. We were obligated to conduct the Offer to Exercise under the terms of the Exercise Agreement entered into in connection with the June 17, 2013 transaction. In connection with the Offer to Exercise, warrants to purchase an aggregate of 305,000 shares of our common stock were exercised for which we received cash proceeds of $64,000. In consideration for the early exercise of these warrants, we issued an aggregate of 152,500 New Warrants at an exercise price of $1.00 per warrant, with a term of five years from issuance. | |||||||||||||||||
Using a binomial pricing model, we calculated the fair value of the New Warrants issued at the end of the Offer to Exercise to be $45,600. We used the following assumptions in the binomial pricing model: estimated volatility 171%; annualized forfeiture rate 0%; expected term 4.875 years; estimated exercise factor 4, risk free interest rate 1.31%; and dividends 0. The New Warrants were accounted for as a cost of the exercise of the warrants issued pursuant to the Exercise Agreement; as a result a $45,600 reduction of APIC was also recorded. Accordingly, there was no net effect on equity because of the issuance of the new warrants. | |||||||||||||||||
Under ASC 820, “Fair Value Measurement,” we re-measure the fair value of the warrants classified as a liability at every balance sheet date. As an integral part of the re-measurement process, we reevaluate each of the assumptions used, and when circumstances change or we become aware of new information affecting any of our assumptions, we adjust those assumptions accordingly. During the three months ended March 31, 2013 two investors in the 2011 private placement exercised an aggregate of 462,500 warrants. While closing our books for the three months ended March 31, 2013, we reevaluated our internal assumptions based on historic and recent exercise patterns and analysis of our stock performance. Based on the work performed, we concluded that a lowering of our estimated exercise factor for the warrants issued in conjunction with the 2011 transaction from 10 to 4 was appropriate (see the assumptions used, as set forth in the tables, below). | |||||||||||||||||
Changes in fair value of the warrants liability are recognized in other (income), except for changes in the fair value of the warrants issued to ipCapital which are recognized as a component of general and administrative expense in the condensed consolidated statement of operations. | |||||||||||||||||
We used the exercise price of the warrants, as well as the fair market value of our common stock, to determine the fair value of our warrants. The exercise price for warrants issued in conjunction with the 2011 Transaction, including those issued to the placement agent, was either $0.20 or $0.26 per share, and was $0.26 per share for the warrants issued to ipCapital. The fair market value of our common stock was $0.54 and $0.30 per share as of September 30, 2013 and 2012, respectively. | |||||||||||||||||
We used a binomial pricing model to determine the fair value of our warrants liability as of September 30, 2013 and December 31, 2012, the balance sheet dates, using the following assumptions: | |||||||||||||||||
2011 Transaction | ipCapital | ||||||||||||||||
30-Sep-13 | 31-Dec-12 | 30-Sep-13 | 31-Dec-12 | ||||||||||||||
Estimated volatility | 120 | % | 159 | % | 125 | % | 163 | % | |||||||||
Annualized forfeiture rate | — | — | — | — | |||||||||||||
Expected option term (years) | 2.92 | 3.67 | 3.04 | 3.79 | |||||||||||||
Estimated exercise factor | 4 | 10 | 4 | 10 | |||||||||||||
Risk-free interest rate | 0.5 | % | 0.45 | % | 0.64 | % | 0.65 | % | |||||||||
Dividends | — | — | — | — | |||||||||||||
The following table is a reconciliation of the warrants liability measured at fair value using significant unobservable inputs (Level 3) for the nine months ended September 30, 2013: | |||||||||||||||||
Warrants liability – December 31, 2012 fair value | $ | 7,390,100 | |||||||||||||||
Change in fair value of warrant liability recorded in other income | (680,100 | ) | |||||||||||||||
Change in fair value of warrant liability recorded in general and administrative expense | 35,700 | ||||||||||||||||
Reclassification of warrants liability to equity from exercise of warrants (1) | (385,900 | ) | |||||||||||||||
Reclassification of warrants liability to equity from amendment to warrants (1) | (4,391,000 | ) | |||||||||||||||
Warrants liability – September 30, 2013 fair value | $ | 1,968,800 | |||||||||||||||
-1 | During the nine-month period ended September 30, 2013, our warrants liability was reduced as a result of the warrants amendment, as discussed above. Additionally, our warrants liability was further reduced by $385,900 as a result of the exercise of 1,072,500 warrants during such period, whose terms were not affected by the changes made under the warrants amendment. The aggregate reduction in the liability, combining the warrant amendment and this exercise, was $4,776,900. See Note 13. | ||||||||||||||||
The following tables reconcile the number of warrants outstanding for the periods indicated: | |||||||||||||||||
For the Three-Month Period Ended September 30, 2013 | |||||||||||||||||
Beginning Outstanding | Exercised | Ending Outstanding | |||||||||||||||
Issued | |||||||||||||||||
2011 Transaction | 13,157,500 | — | 305,000 | 12,852,500 | |||||||||||||
Exercise Agreement | 4,500,000 | — | — | 4,500,000 | |||||||||||||
ipCapital | 400,000 | — | — | 400,000 | |||||||||||||
Consultant Warrant (1) | — | 312,500 | — | 312,500 | |||||||||||||
Offer to Exercise | — | 152,500 | — | 152,500 | |||||||||||||
Total | 18,057,500 | 465,000 | 305,000 | 18,217,500 | |||||||||||||
For the Nine-Month Period Ended September 30, 2013 | |||||||||||||||||
Beginning Outstanding | Exercised | Ending Outstanding | |||||||||||||||
Issued | |||||||||||||||||
2011 Transaction | 23,075,000 | — | 10,222,500 | 12,852,500 | |||||||||||||
Exercise Agreement | — | 4,500,000 | — | 4,500,000 | |||||||||||||
ipCapital | 400,000 | — | — | 400,000 | |||||||||||||
Consulting Warrant (1) | — | 312,500 | — | 312,500 | |||||||||||||
Offer to Exercise | — | 152,500 | — | 152,500 | |||||||||||||
Total | 23,475,000 | 4,965,000 | 10,222,500 | 18,217,500 | |||||||||||||
For the Three and Nine-Month Period Ended September 30, 2012 | |||||||||||||||||
Beginning Outstanding | Exercised | Ending Outstanding | |||||||||||||||
Issued | |||||||||||||||||
2011 Transaction | 23,075,000 | — | — | 23,075,000 | |||||||||||||
ipCapital | 400,000 | — | — | 400,000 | |||||||||||||
Total | 23,475,000 | — | — | 23,475,000 | |||||||||||||
(1) Effective September 18, 2013, we entered into a consulting agreement with Genesis Select to provide us with a variety of investor relations services. As part of their compensation, we issued to them a warrant to purchase 312,500 shares of our common stock at an exercise price of $0.50 per share. The warrant will vest, monthly, over the initial twelve-month service period of the contract, assuming that the agreement remains in-force, with the first vesting having occured on October 18, 2013. The warrant is substantially similar in nature to those issued in the warrant amendment, discussed above, thus; the warrant is accounted in equity and is not included as a component of our warrants liability as of September 30, 2013. We used the following assumptions in a binomial pricing model to calculate the fair value of the warrant issued to Genesis: estimated volatility – 181%; expected term – 4.96 years; estimated exercise factor – 4, risk free interest rate – 1.41%; and dividends – 0. Expense associated with this warrant is recognized as a component of general and administrative expense over the one-year vesting term of the warrant. |
Severance_Liability
Severance Liability | 9 Months Ended | ||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||
Severance Liability [Abstract] | ' | ||||||||||||||||||||||||
Severance Liability | ' | ||||||||||||||||||||||||
5. Severance Liability | |||||||||||||||||||||||||
On April 12, 2012, we entered into a separation agreement and a release with Robert Dilworth in connection with Mr. Dilworth’s resignation as our Chief Executive Officer and as a member of our board of directors. Subject to the terms of the separation agreement, effective April 20, 2012 (the “Release Effective Date”) we paid or provided Mr. Dilworth the following: | |||||||||||||||||||||||||
· | On the Release Effective Date, Mr. Dilworth’s outstanding unvested options became fully vested and exercisable, and his outstanding vested options were modified to extend the exercise period. All options will remain exercisable until the earlier of (i) the expiration dates of each of such options or (ii) the date that is 30 months after the Release Effective Date. The number of shares of common stock issuable upon exercise of such outstanding options is 2,000,000. We recognized $172,700 of non-cash stock-based compensation expense during 2012, as a result of the modification of Mr. Dilworth’s outstanding stock options. No expense was recognized during the nine-month period ended September 30, 2013 as a result of the modifications. | ||||||||||||||||||||||||
· | On the Release Effective Date, Mr. Dilworth was granted an option to purchase 500,000 shares of common stock at an exercise price of $0.20 per share. Such option has a term of 30 months from the date of grant and will vest and become exercisable at a rate of 62,500 shares per quarter commencing on July 1, 2012. We recognized $64,700 of non-cash stock-based compensation expense during 2012 as a result of the issuance of this stock option to Mr. Dilworth. No expense was recognized during the nine-month period ended September 30, 2013 as a result of the issuance. | ||||||||||||||||||||||||
· | From May 2012 through April 2013, Mr. Dilworth was paid $27,300 per month. From May 2013 through April 2014, Mr. Dilworth will be paid $13,600 per month. During the three-month period ended June 30, 2012, we recognized $433,700 compensation expense related to Mr. Dilworth’s separation agreement, which we recorded as a liability. Such amount represented the present value of the future salary and medical insurance (discussed below) continuation payments due Mr. Dilworth under the terms of the separation agreement. During the three and nine-month periods ended September 30, 2013, we made salary continuation payments aggregating $36,600 and $172,900, respectively, to Mr. Dilworth. As of September 30, 2013, the aggregate present value of the remaining future salary and medical insurance coverage continuation payments due Mr. Dilworth was $92,300, which was reported as a current liability. All interest expense associated with the salary and medical insurance continuation payments made are charged to general and administrative expenses as incurred. During the three and nine-month periods ended June 30, 2013, we incurred interest charges of $4,200 and $18,100 respectively. | ||||||||||||||||||||||||
· | From May 2012 through October 2013, we paid the premium costs to continue medical coverage for Mr. Dilworth and his spouse under the Employment Retirement Income Security Act of 1974. Such premiums aggregated $5,800 for May 2012 and June 2012, and will approximate $1,300 per month thereafter. During the three and nine-month periods ended September 30, 2013 we made medical insurance coverage continuation payments of $3,800 and $11,000 respectively. During the three and nine-month periods ended September 30, 2013, we incurred interest charges of $100 and $700, respectively. | ||||||||||||||||||||||||
· | We paid Mr. Dilworth $15,000 as reimbursement for a portion of his legal fees in connection with negotiation of the separation agreement and the release. | ||||||||||||||||||||||||
Mr. Dilworth’s participation in the Key Employee Severance Plan and the Director Severance Plan was automatically terminated on the Release Effective Date. In addition, the separation agreement contains confidentiality and non-disparagement provisions subject to the terms set forth therein. Pursuant to the terms of the release, Mr. Dilworth provided as of the Release Effective Date a release of claims in connection with his employment and resignation. As a result of the separation agreement, we recognized an aggregate $721,800 of additional operating expenses, as summarized above of which all such expense was recognized contemporaneously with the consummation of Mr. Dilworth’s separation agreement during the second quarter of 2012. | |||||||||||||||||||||||||
We estimated the fair value of each stock-based award set forth above, which were included as part of Mr. Dilworth’s separation agreement during 2012, using a binomial model with the assumptions set forth in the following table: | |||||||||||||||||||||||||
Estimated Volatility | Annualized Forfeiture Rate | Expected Option Term (Years) | Estimated Exercise Factor | Risk-Free Interest Rate | Dividends | ||||||||||||||||||||
Modified options | 70% - 157 | % | 0 | % | 0.25 – 2.5 | 10 | 0.08% - 0.29 | % | — | ||||||||||||||||
New option | 157 | % | 0 | % | 2.5 | 10 | 0.29 | % | — | ||||||||||||||||
Expected volatility is based on the historical volatility of our common stock over the expected option term period ended on the last business day of each respective quarterly reporting period. The estimated forfeiture rate was set to zero as Mr. Dilworth is not obligated to perform any services for us under the terms of the separation agreement. The expected term was based on the actual expiration date of each of the options in the separation agreement. The estimated exercise factor was based on an analysis of historical data; historical exercise patterns; and a comparison of historical and current share prices. The approximate risk free interest rate was based on the implied yield available on U.S. Treasury issues with remaining terms equivalent to our expected term on our stock-based awards. We do not anticipate paying dividends on our common stock for the foreseeable future. | |||||||||||||||||||||||||
We discounted the initial aggregate remaining cash salary continuation payments due Mr. Dilworth and medical premiums to be paid on his behalf of $458,600 under the terms of the separation agreement using a 14.3% discount factor, with such factor representing our average cost of capital, which we derived by analyzing the costs we incurred in the various private placement transactions we have closed since 2004. | |||||||||||||||||||||||||
On July 17, 2013 we entered into a separation agreement and release with a former vice president-level employee who left the Company on June 7, 2013. Subject to the terms of the separation agreement, which became effective on July 17, 2013 (the “Effective Date”), we accrued $75,700 of severance liability at June 30, 2013, of which, $47,800 remained outstanding as of September 30, 2013. | |||||||||||||||||||||||||
The following table summarizes the salary continuation and medical coverage payments during the nine-month period ended September 30, 2013. | |||||||||||||||||||||||||
Compensation | Medical Coverage | Total | |||||||||||||||||||||||
Balance at December 31, 2012 | $ | 250,100 | $ | 12,300 | $ | 262,400 | |||||||||||||||||||
Separation agreement entered into in 2013 | 60,000 | 15,700 | 75,700 | ||||||||||||||||||||||
Accrued interest | 18,100 | 700 | 18,800 | ||||||||||||||||||||||
Payments | (197,200 | ) | (19,600 | ) | (216,800 | ) | |||||||||||||||||||
Balance at September 30, 2013 | $ | 131,000 | $ | 9,100 | $ | 140,100 | |||||||||||||||||||
Deferred_Rent
Deferred Rent | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Deferred Rent [Abstract] | ' | ||||||||||||
Deferred Rent | ' | ||||||||||||
6. Deferred Rent | |||||||||||||
As of September 30, 2013 deferred rent was: | |||||||||||||
Component | Current Liabilities | Long-Term Liabilities | Total | ||||||||||
Deferred rent expense | $ | 5,800 | $ | 38,500 | $ | 44,300 | |||||||
Deferred rent benefit | 24,000 | 66,000 | 90,000 | ||||||||||
$ | 29,800 | $ | 104,500 | $ | 134,300 | ||||||||
As of December 31, 2012 deferred rent was: | |||||||||||||
Component | Current Liabilities | Long-Term Liabilities | Total | ||||||||||
Deferred rent expense | $ | 2,700 | $ | 43,500 | $ | 46,200 | |||||||
Deferred rent benefit | 24,000 | 84,000 | 108,000 | ||||||||||
$ | 26,700 | $ | 127,500 | $ | 154,200 | ||||||||
Deferred rent expense represents the remaining balance of the aggregate free rent we received from our landlord and escalations that are being recognized over the life of the lease as a component of rent expense. Deferred rent benefit relates to the unamortized portion of the leasehold improvements provided to us by our landlord (i.e., incentives) that we are recognizing on a straight-line basis as a reduction to rent expense over the term of the lease. |
StockBased_Compensation
Stock-Based Compensation | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Stock-Based Compensation [Abstract] | ' | ||||||||||||||||
Stock-Based Compensation | ' | ||||||||||||||||
7. Stock-Based Compensation | |||||||||||||||||
The following table summarizes the stock-based compensation expense, net of amounts capitalized, we recorded in our Unaudited Condensed Consolidated Statements of Operations for the three and nine-month periods ended September 30, 2013 and 2012, respectively, by classification: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
Statement of Operations Classification | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Costs of revenue | $ | (500 | ) | $ | 6,700 | $ | 3,300 | $ | 17,100 | ||||||||
Selling and marketing expense | 39,800 | 33,200 | 118,700 | 84,800 | |||||||||||||
General and administrative expense | 76,300 | 71,000 | 255,800 | 404,700 | |||||||||||||
Research and development expense | 74,400 | 82,600 | 202,700 | 252,400 | |||||||||||||
$ | 190,000 | $ | 193,500 | $ | 580,500 | $ | 759,000 | ||||||||||
The following table presents summaries of the status and activity of our stock option awards for the three-month period ended September 30, 2013. | |||||||||||||||||
Number of Shares | Weighted Average Exercise | Weighted Average | Aggregate Intrinsic Value | ||||||||||||||
Price | Remaining Contractual | ||||||||||||||||
Terms (Years) | |||||||||||||||||
Outstanding – June 30, 2013 | 13,134,398 | $ | 0.2 | ||||||||||||||
Granted | 23,000 | 0.44 | |||||||||||||||
Exercised | (708,594 | ) | 0.18 | ||||||||||||||
Forfeited or expired | (77,745 | ) | 0.2 | ||||||||||||||
Outstanding – September 30, 2013 | 12,371,059 | $ | 0.2 | 6.12 | $ | 4,161,600 | |||||||||||
The following table presents summaries of the status and activity of our stock option awards for the nine-month period ended September 30, 2013. | |||||||||||||||||
Number of Shares | Weighted Average Exercise | Weighted Average | Aggregate Intrinsic Value | ||||||||||||||
Price | Remaining Contractual | ||||||||||||||||
Terms (Years) | |||||||||||||||||
Outstanding – December 31, 2012 | 14,174,000 | $ | 0.2 | ||||||||||||||
Granted | 23,000 | 0.44 | |||||||||||||||
Exercised | (1,459,972 | ) | 0.17 | ||||||||||||||
Forfeited or expired | (232,151 | ) | 0.2 | ||||||||||||||
Cancellation of unearned performance option | (133,818 | ) | 0.19 | ||||||||||||||
Outstanding – September 30, 2013 | 12,371,059 | $ | 0.2 | 6.12 | $ | 4,161,600 | |||||||||||
Of the options outstanding as of September 30, 2013, 8,332,644 were vested, 3,906,226 were estimated to vest in future periods and 132,189 were estimated to be forfeited prior to their vesting. As of September 30, 2013, there was approximately $239,100 of total unrecognized compensation cost, net of estimated forfeitures, related to unvested stock options. Such cost is expected to be recognized over a weighted-average period of approximately nine months. | |||||||||||||||||
All options are exercisable immediately upon grant. Options vest, ratably over a 33-month period commencing in the fourth month after the grant date. We have the right to repurchase common stock issued upon the exercise of an option upon an optionee’s termination of service to us prior to full vesting at the option’s exercise price. | |||||||||||||||||
The following table presents summaries of the status and activity of our restricted stock awards for the three-month period ended September 30, 2013. We include the common stock underlying the restricted stock award in shares outstanding once such common stock has vested and the restriction has been removed (“releases” or “released”).The common stock vests ratably, over a 33-month period; however, no such shares vest until after three months from the date of the restricted stock award. | |||||||||||||||||
Number of Shares | Weighted Average Grant Date Fair Value | Weighted Average | Unrecognized Compensation Cost Remaining | ||||||||||||||
Remaining Recognition P | |||||||||||||||||
eriod (Years) | |||||||||||||||||
Unreleased – June 30, 2013 | 3,796,324 | $ | 0.22 | ||||||||||||||
Awarded | 1,027,500 | 0.42 | |||||||||||||||
Released | (432,521 | ) | 0.23 | ||||||||||||||
Forfeited | (265,157 | ) | 0.27 | ||||||||||||||
Outstanding – September 30, 2013 | 4,126,146 | $ | 0.26 | 2.15 | $ | 918,400 | |||||||||||
The following table presents summaries of the status and activity of our restricted stock awards for the nine-month period ended September 30, 2013. | |||||||||||||||||
Number of Shares | Weighted Average Grant Date Fair Value | Weighted Average | Unrecognized Compensation Cost Remaining | ||||||||||||||
Remaining Recognition | |||||||||||||||||
Period (Years) | |||||||||||||||||
Unreleased – December 31, 2012 | 4,043,123 | $ | 0.18 | ||||||||||||||
Awarded | 1,607,500 | 0.42 | |||||||||||||||
Released | (1,208,412 | ) | 0.21 | ||||||||||||||
Forfeited | (316,065 | ) | 0.36 | ||||||||||||||
Outstanding – September 30, 2013 | 4,126,146 | $ | 0.26 | 2.15 | $ | 918,400 | |||||||||||
As of September 30, 2013, there was approximately $918,400 of total unrecognized compensation cost, net of estimated forfeitures, related to unreleased restricted stock awards. That cost is expected to be recognized over a weighted-average period of approximately twenty-six months. | |||||||||||||||||
Revenue
Revenue | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Revenue [Abstract] | ' | ||||||||||||||||
Revenue | ' | ||||||||||||||||
8. Revenue | |||||||||||||||||
Revenue for the three-month periods ended September 30, 2013 and 2012 was: | |||||||||||||||||
Three Months Ended | 2013 Over (Under) 2012 | ||||||||||||||||
September 30, | |||||||||||||||||
Revenue | 2013 | 2012 | Dollars | Percent | |||||||||||||
Software Licenses | |||||||||||||||||
Windows | $ | 559,600 | $ | 775,600 | $ | (216,000 | ) | -27.8 | % | ||||||||
UNIX/Linux | 219,900 | 234,200 | (14,300 | ) | -6.1 | % | |||||||||||
779,500 | 1,009,800 | (230,300 | ) | -22.8 | % | ||||||||||||
Software Service Fees | |||||||||||||||||
Windows | 511,300 | 469,200 | 42,100 | 9 | % | ||||||||||||
UNIX/Linux | 226,500 | 232,700 | (6,200 | ) | -2.7 | % | |||||||||||
737,800 | 701,900 | 35,900 | 5.1 | % | |||||||||||||
Other | 17,400 | 22,400 | (5,000 | ) | -22.3 | % | |||||||||||
Total Revenue | $ | 1,534,700 | $ | 1,734,100 | $ | (199,400 | ) | -11.5 | % | ||||||||
Revenue for the nine-month periods ended September 30, 2013 and 2012 was: | |||||||||||||||||
Nine Months Ended | 2013 Over (Under) 2012 | ||||||||||||||||
September 30, | |||||||||||||||||
Revenue | 2013 | 2012 | Dollars | Percent | |||||||||||||
Software Licenses | |||||||||||||||||
Windows | $ | 1,673,400 | $ | 2,046,200 | $ | (372,800 | ) | -18.2 | % | ||||||||
UNIX/Linux | 670,100 | 724,300 | (54,200 | ) | -7.5 | % | |||||||||||
2,343,500 | 2,770,500 | (427,000 | ) | -15.4 | % | ||||||||||||
Software Service Fees | |||||||||||||||||
Windows | 1,471,700 | 1,338,800 | 132,900 | 9.9 | % | ||||||||||||
UNIX/Linux | 686,300 | 705,000 | (18,700 | ) | -2.7 | % | |||||||||||
2,158,000 | 2,043,800 | 114,200 | 5.6 | % | |||||||||||||
Other | 44,000 | 101,300 | (57,300 | ) | -56.6 | % | |||||||||||
Total Revenue | $ | 4,545,500 | $ | 4,915,600 | $ | (370,100 | ) | -7.5 | % |
Cost_of_Revenue
Cost of Revenue | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Cost of Revenue [Abstract] | ' | ||||||||||||||||
Cost of Revenue | ' | ||||||||||||||||
9. Cost of Revenue | |||||||||||||||||
Cost of revenue for the three-month periods ended September 30, 2013 and 2012 was: | |||||||||||||||||
Three Months Ended | 2013 Over (Under) 2012 | ||||||||||||||||
September 30, | |||||||||||||||||
2013 | 2012 | Dollars | Percent | ||||||||||||||
Software service costs | $ | 64,100 | $ | 97,500 | $ | (33,400 | ) | -34.3 | % | ||||||||
Software product costs | 36,400 | 63,200 | (26,800 | ) | -42.4 | % | |||||||||||
$ | 100,500 | $ | 160,700 | $ | (60,200 | ) | -37.5 | % | |||||||||
Cost of revenue for the nine-month periods ended September 30, 2013 and 2012 was: | |||||||||||||||||
Nine Months Ended | 2013 Over (Under) 2012 | ||||||||||||||||
September 30, | |||||||||||||||||
2013 | 2012 | Dollars | Percent | ||||||||||||||
Software service costs | $ | 191,900 | $ | 233,000 | $ | (41,100 | ) | -17.6 | % | ||||||||
Software product costs | 157,700 | 198,600 | (40,900 | ) | -20.6 | % | |||||||||||
$ | 349,600 | $ | 431,600 | $ | (82,000 | ) | -19 | % | |||||||||
Capitalized_Software_Developme
Capitalized Software Development Costs | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Capitalized Software Development Costs [Abstract] | ' | ||||||||
Capitalized Software Development Costs | ' | ||||||||
10. Capitalized Software Development Costs | |||||||||
Capitalized software development costs consisted of the following: | |||||||||
30-Sep-13 | 31-Dec-12 | ||||||||
Software development costs | $ | 1,116,700 | $ | 573,100 | |||||
Accumulated amortization | (457,100 | ) | (350,000 | ) | |||||
$ | 659,600 | $ | 223,100 | ||||||
Amortization of capitalized software development costs is a component of costs of revenue. Capitalized software development costs amortization aggregated $24,000 and $107,100 during the three and nine-month periods ended September 30, 2013, respectively, and $41,500 and $124,600 during the three and nine-month periods ended September 30, 2012, respectively. | |||||||||
We recorded $79,100 and $543,600 of capitalized software development costs during the three and nine-month periods ended September 30, 2013, respectively. Such capitalized costs were incurred in the development of our new product hopTo, and are comprised primarily of employee costs and the cost of licenses to third party software that will be used by our hopTo product upon its commercial release. We anticipate releasing the first commercial version of hopTo in the fourth quarter time frame and will begin amortizing its capitalized software development costs accordingly (See Note 18). Had these costs not met the criteria for capitalization, they would have been expensed. We did not record any capitalized software development costs during the nine-month period ended September 30, 2012. | |||||||||
Stockholders_Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2013 | |
Stockholders' Equity [Abstract] | ' |
Stockholders' Equity | ' |
11. Stockholders’ Equity | |
Stock Repurchase Program | |
During each of the three and nine-month periods ended September 30, 2013 and 2012, we did not repurchase any of our common stock under the terms of our Board-approved $1,000,000 stock repurchase program (“stock repurchase program”). As of September 30, 2013, approximately $782,600 remained available for future purchases under this program. We are not obligated to repurchase any specific number of shares and the stock repurchase program may be suspended or terminated at our discretion. | |
Commitments_and_Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2013 | |
Commitments and Contingencies [Abstract] | ' |
Commitments and Contingencies | ' |
12. Commitments and Contingencies | |
Our corporate headquarters currently occupies 4,413 square feet of office space in Campbell, California, under a five-year lease that expires June 30, 2017. During October 2013, we amended our lease in order to secure a larger facility from our landlord. See Note 18. |
Supplemental_Disclosure_of_Cas
Supplemental Disclosure of Cash Flow Information | 9 Months Ended |
Sep. 30, 2013 | |
Supplemental Disclosure of Cash Flow Information [Abstract] | ' |
Supplemental Disclosure of Cash Flow Information | ' |
13. Supplemental Disclosure of Cash Flow Information | |
We did not disburse any cash for the payment of interest expense during the nine-month periods ended September 30, 2013 or 2012. | |
We disbursed $1,800 and $3,100 for the payment of income taxes during the nine-month periods ended September 30, 2013 and 2012, respectively. All such disbursements were for the payment of foreign income taxes related to the operation of our Israeli subsidiary, GraphOn Research Labs Ltd. | |
During the nine-month period ended September 30, 2013, we capitalized $36,700 of stock-based compensation expense for which no cash was disbursed, as a component of capitalized software development costs. We did not capitalize any stock based compensation expense costs during the nine month period ended September 30, 2012. | |
During the nine-month period ended September 30, 2013, we reduced our warrants liability by $5,421,300, of which $680,100 was recorded in the Condensed Consolidated Statement of Operations. The amendment to the warrants resulted in $4,391,000 being reclassified to equity. The remaining reduction amount was the result of the exercise of 1,072,500 warrants that were not part of the amendment. No cash was disbursed in conjunction with these items (see Note 4). | |
During the nine-month period ended September 30, 2013, we capitalized $3,700 of property and equipment for which no cash was disbursed. | |
During the nine month period ended September 30, 2012, we incurred costs associated with discontinued intellectual property operations activities of $468,400, of which $432,800 was disbursed, and the balance reported as a component of accounts payable. | |
During the nine-month period ended September 30, 2012, we capitalized $130,900 of property and equipment for which no cash was disbursed. We recorded $104,100 of such amount to long term liabilities – deferred rent, $24,000 of such amount to current liabilities – deferred rent and the balance to accounts payable and accrued liabilities. | |
Earnings_Loss_Per_Share
Earnings (Loss) Per Share | 9 Months Ended |
Sep. 30, 2013 | |
Earnings (Loss) Per Share [Abstract] | ' |
Earnings (Loss) Per Share | ' |
14. Earnings (Loss) Per Share | |
Earnings or loss per share is calculated by dividing the net income or loss for the period by the weighted average number of shares of common stock outstanding during the period. Diluted earnings or loss per share (“Diluted EPS”) is calculated by dividing the net income or loss for the period by the total of the weighted average number of shares of common stock outstanding during the period plus the effects of any dilutive securities. Diluted EPS considers the impact of potentially dilutive securities except in periods in which there is a loss because the inclusion of such potential shares of common stock would have an anti-dilutive effect. During all periods presented in our Condensed Consolidated Statements of Operations, potentially dilutive securities included shares of common stock potentially issuable upon exercise of stock options, release of unvested restricted stock awards and exercise of warrants. Diluted EPS excludes the impact of potential issuance of shares of common stock related to our stock options in periods in which the exercise price of the stock option is greater than the average market price of our common stock during such periods. | |
For the three-month periods ended September 30, 2013 and 2012, 33,707,201 and 36,997,357 shares of common stock equivalents, respectively, were excluded from the computation of dilutive loss per share since their effect would be antidilutive. | |
For the nine-month periods ended September 30, 2013 and 2012, 33,707,201 and 36,997,357 shares of common stock equivalents, respectively, were excluded from the computation of dilutive loss per share since their effect would be antidilutive. | |
Segment_Information
Segment Information | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Segment Information [Abstract] | ' | ||||||||||||||||
Segment Information | ' | ||||||||||||||||
15. Segment Information | |||||||||||||||||
FASB has established guidance for reporting information about operating segments that require segmentation based on our internal organization and reporting of revenue and operating income, based on internal accounting methods. Our financial reporting systems present various data for management to operate the business prepared in methods consistent with such guidance. | |||||||||||||||||
During 2012, we entered into settlement and licensing agreements that effectively ended all of our then ongoing intellectual property litigation activities (Note 17). As a result of these agreements, we will no longer be pursuing patent litigation as an integral funding strategy for our operations. | |||||||||||||||||
We will continue to pursue the intellectual property initiatives we have undertaken in conjunction with our relationship with ipCapital, however we believe that these initiatives do not comprise a reporting segment as the intent of these initiatives is to support and leverage our current software products and those in development. | |||||||||||||||||
Also, effective for the quarter ended December 31, 2012, we added a new segment (hopTo) and identified that we currently operate our business in two segments; namely GO-Global and hopTo. Currently, GO-Global is the only segment that generates revenue. | |||||||||||||||||
During the three-month period ended September 30, 2013, commensurate with the renaming of our company to hopTo Inc., we reclassified certain corporate-level expenses from the GO-Global segment to the hopTo segment, including those pertaining to our ipCapital initiatives. The impact of such reclassifications appears in the following segment tables for all periods presented. | |||||||||||||||||
Segment revenue for the three-month periods ended September 30, 2013 and 2012 was as follows: | |||||||||||||||||
Increase (Decrease) | |||||||||||||||||
2013 | 2012 | Dollars | Percentage | ||||||||||||||
GO-Global | $ | 1,534,700 | $ | 1,734,100 | $ | (199,400 | ) | -11.5 | % | ||||||||
hopTo | — | — | — | n/ | a | ||||||||||||
Consolidated Total | $ | 1,534,700 | $ | 1,734,100 | $ | (199,400 | ) | -11.5 | % | ||||||||
Segment revenue for the nine-month periods ended September 30, 2013 and 2012 was as follows: | |||||||||||||||||
Increase (Decrease) | |||||||||||||||||
2013 | 2012 | Dollars | Percentage | ||||||||||||||
GO-Global | $ | 4,545,500 | $ | 4,915,600 | $ | (370,100 | ) | -7.5 | % | ||||||||
hopTo | — | — | — | n/ | a | ||||||||||||
Consolidated Total | $ | 4,545,500 | $ | 4,915,600 | $ | (370,100 | ) | -7.5 | % | ||||||||
Segment loss from continuing operations for the three and nine-month periods ended September 30, 3013 and 2012 was as follows: | |||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
GO-Global | $ | 800 | $ | 413,000 | $ | (204,500 | ) | $ | (591,000 | ) | |||||||
hopTo | (1,609,300 | ) | (1,067,800 | ) | (3,318,000 | ) | (2,835,200 | ) | |||||||||
Total | $ | (1,608,500 | ) | $ | (654,800 | ) | $ | (3,522,500 | ) | $ | (3,426,200 | ) | |||||
We do not allocate interest, other income, other expense, or income tax to our segments. | |||||||||||||||||
As of September 30, 2013 segment fixed assets (long-lived assets) were as follows: | |||||||||||||||||
Accumulated | |||||||||||||||||
Depreciation | |||||||||||||||||
Cost Basis | /Amortization | Net | |||||||||||||||
GO-Global | $ | 1,964,900 | $ | (1,799,100 | ) | $ | 165,800 | ||||||||||
hopTo | 930,800 | (79,200 | ) | 851,600 | |||||||||||||
Total from continuing operations | 2,895,700 | (1,878,300 | ) | 1,017,400 | |||||||||||||
Discontinued operations | 2,839,000 | (2,839,000 | ) | — | |||||||||||||
Unallocated | 31,700 | — | 31,700 | ||||||||||||||
Total | $ | 5,766,400 | $ | (4,717,300 | ) | $ | 1,049,100 | ||||||||||
We do not maintain any significant long-lived assets outside of the United States. | |||||||||||||||||
Products and services provided by the GO-Global segment include all currently available versions of the GO-Global family of products, OEM private labeling kits, software developer’s kits, maintenance contracts, and product training and support. The hopTo segment, which is under development, will provide mobile end-users with a productivity workspace for their mobile devices that will allow users to manage, share, view, and edit their documents, regardless of where they are stored. We launched the first public release of hopTo through Apple’s App Store in April 2013. The two segments do not engage in cross-segment transactions. | |||||||||||||||||
Go-Global software revenue by country for the three-and nine month periods ended September 30, 2013 and 2012 was as follows: | |||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
Revenue by Country | 2013 | 2012 | 2013 | 2012 | |||||||||||||
United States | $ | 677,600 | $ | 668,800 | $ | 1,886,000 | $ | 1,980,100 | |||||||||
Germany | 84,600 | 181,000 | 354,200 | 533,300 | |||||||||||||
Brazil | 161,000 | 176,400 | 415,100 | 444,800 | |||||||||||||
Other Countries | 611,500 | 707,900 | 1,890,200 | 1,957,400 | |||||||||||||
Total | $ | 1,534,700 | $ | 1,734,100 | $ | 4,545,500 | $ | 4,915,600 | |||||||||
Related_Party_Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2013 | |
Related Party Transactions [Abstract] | ' |
Related Party Transactions [Text Block] | ' |
16. Related Party Transactions | |
Tamalpais Partners LLC | |
Steven Ledger, the Chairman of our Board of Directors, is the founder and managing partner of Tamalpais Partners LLC, (“Tamalpais”) a business consulting firm. On August 1, 2013, we amended our consulting agreement with Tamalpais. Under the consulting agreement, as amended, Tamalpais will provide us with advisory services focused on capital and business issues, including assistance on raising capital, mergers, acquisitions, business development and investor relations/positioning. We paid Tamalpais $54,000 and $18,000 during the three-month periods ended September 30, 2013 and 2012, respectively, for services rendered to us under the terms of this consulting agreement. We paid Tamalpais $92,000 and $48,000 during the nine-month periods ended September 30, 2013 and 2012, respectively, for services rendered to us under the terms of this consulting agreement. No amounts were due to Tamalpais at September 30, 2013. | |
ipCapital Group, Inc. | |
On October 11, 2011, we engaged ipCapital Group, Inc. (“ipCapital”), an affiliate of John Cronin, who is one of our directors, to assist us in the execution of our strategic decision to significantly strengthen, grow and commercially exploit our intellectual property assets. Our engagement agreement with ipCapital, which has been amended three times, affords us the right to request ipCapital to perform a number of diverse services, employing its proprietary processes and methodologies, to facilitate our ability to identify and extract from our current intellectual property base new inventions, potential patent applications, and marketing and licensing opportunities. | |
For the three and nine-month periods ended September 30, 2013 we paid ipCapital an aggregate of $0 and $31,200, respectively, for services performed under the engagement agreement, as amended. No amounts were due ipCapital at September 30, 2013. For the three and nine-month periods ended September 30, 2012 we paid ipCapital an aggregate $30,000 and $130,000, respectively for services performed under the engagement agreement, as amended. As of September 30, 2012, we owed ipCapital $37,300. | |
Prior to entering into the engagement agreement with ipCapital in 2011, ipCapital performed an analysis of our intellectual property and the potential methods we could employ to strengthen our intellectual property on a consulting basis. We paid ipCapital $50,000 for this analysis in the nine-month period ended September 30, 2012. All amounts paid to ipCapital in 2013 and 2012 have been reported within general and administrative expense. | |
In addition to the fees we agreed to pay ipCapital for its services, we issued ipCapital a five-year warrant to purchase up to 400,000 shares of our common stock at an initial price of $0.26 per share. Half of the warrant (200,000 shares) has a time-based vesting condition, with such vesting to occur in three equal annual installments. The first two vesting installments occurred on October 11, 2012 and October 11, 2013, respectively, with the remaining vesting installment to occur on October 11, 2014. The remaining 200,000 shares became fully vested upon the completion to our satisfaction of all services that we requested from ipCapital under the engagement agreement, prior to the signing of the amendments. Such performance was deemed satisfactory during 2012. We believe that these fees, together with the issuance of the warrant, constitute no greater compensation than we would be required to pay an unaffiliated person for performing substantially similar services. | |
The exercise price of the warrant issued to ipCapital could be reset to below-market value. Consequently, we have concluded that such warrant is not indexed to our common stock and should be recorded as a liability. We recognize the warrants liability over their vesting period, and in accordance with the liability method of accounting, we re-measure the fair value of the accrued warrants at each balance sheet date and recognize the change in fair value as general and administrative compensation expense. (See Note 4) We recognized $49,500 and $38,200 as a component of general and administrative expense during the three-month periods ended September, 2013 and 2012, respectively, and $35,700 and $52,700 during the nine-month periods ended September 30, 2013 and 2012, respectively, resulting from the change in fair value. | |
ipCapital Licensing Company I, LLC | |
On February 4, 2013, we entered into an IP Brokerage agreement with ipCapital Licensing Company I, LLC (“ipCLC”). John Cronin is a partner at ipCLC. Pursuant to the agreement, we have engaged ipCLC, on a no-retainer basis, to identify and present us with candidates who may be seeking to acquire a certain limited group of our patents unrelated to our current business strategy. If during the applicable term we enter into an agreement with any candidate presented by ipCLC to acquire or otherwise exploit the covered patents, we will pay ipCLC a fee of ten percent (10%) of the royalties, fees, and other consideration paid over the life of the agreement. | |
The agreement is effective as of February 4, 2013, and will end 18 months after we or ipCLC serve 60 days written notice of termination to the other party (with earlier termination possible in the event of a material breach). The agreement provides for customary confidentiality undertakings, limitations on ipCLC’s total liability and mutual indemnification provisions. | |
We believe the terms of the agreement are fair and reasonable to us and are at least as favorable as those that could be obtained on an arms’ length basis. |
Discontinued_Operations
Discontinued Operations | 9 Months Ended |
Sep. 30, 2013 | |
Discontinued Operations [Abstract] | ' |
Discontinued Operations | ' |
17. Discontinued Operations | |
During 2012, we reached settlement agreements that effectively ended all of our then on-going intellectual property litigation. With the settlement of such litigation activities we ceased actively pursuing intellectual property litigation as an integral part of our strategy to fund our operations. Accordingly, for all periods presented, the results of operations and cash flows related to our former intellectual property segment has been segregated and reported as “Discontinued Operations”. There was no revenue derived from our intellectual property litigation in either of the three or nine month periods ended September 30, 2013 or 2012. During the three and nine-month periods ended September 30, 2012 we incurred costs of $347,100 and $468,400 related to our discontinued operations, respectively. | |
We will continue to make significant investments in our intellectual property during the remainder of 2013. We believe such investments will be an asset that will leverage our product strategy and protect our long-term growth strategies. We do not intend to pursue intellectual property litigation as an integral part of our strategy to fund our future operations. | |
As of September 30, 2013 and 2012, all of our patents were fully amortized. Additionally, we have characterized the NES patents as “held for sale” and will be pursuing reasonable sales opportunities for such patents as they become known to us. | |
Subsequent_Events
Subsequent Events | 9 Months Ended | ||||
Sep. 30, 2013 | |||||
Subsequent Events [Abstract] | ' | ||||
Subsequent Events | ' | ||||
18. Subsequent Events | |||||
On October 7, 2013, we amended our office lease with our landlord. Under the terms of the amendment, we will move from our current location to another building within the same office complex, and increase the space we lease from 4,413 square feet to 10,659 square feet. We believe the move will be completed on or about December 31, 2013. | |||||
The amended lease becomes effective November 1, 2013 and will expire on October 31, 2018. The lease contains rent escalation clauses and four months of free rent. Additionally, we paid $18,100 to the landlord as a prepayment of the first month’s rent on the new space. The following table sets forth the minimum lease payments due over the life of the lease. | |||||
Year | Amount | ||||
Remainder of 2013 | $ | — | |||
2014 | 346,000 | ||||
2015 | 449,500 | ||||
2016 | 463,000 | ||||
2017 | 476,900 | ||||
2018 | 407,300 | ||||
$ | 2,142,700 | ||||
Under the terms of the lease, the landlord will provide us with various leasehold improvements totaling $106,600. Upon signing the amendment, we made a deposit of $109,000 to our landlord. | |||||
As of September 30, 2013, we reported $103,700 of unamortized leasehold improvements associated with our current lease. We expect to amortize this amount over the remaining three month life of our current lease. We believe we will be moving most of our current furniture and equipment to our new space. | |||||
On November 14, 2013, we launched the first commercial version of hopTo, our mobile productivity workspace product on Apple’s App Store. |
Significant_Accounting_Policie1
Significant Accounting Policies (Policies) | 9 Months Ended | ||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||
Significant Accounting Policies [Abstract] | ' | ||||||||||||||||||||
Use of Estimates | ' | ||||||||||||||||||||
Use of Estimates | |||||||||||||||||||||
The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. These estimates include: the amount of stock-based compensation expense; the allowance for doubtful accounts; the estimated lives, valuation, and amortization of intangible assets (including capitalized software); depreciation of long-lived assets; valuation of warrants; post-employment benefits, and accruals for liabilities. While we believe that such estimates are fair, actual results could differ materially from those estimates. | |||||||||||||||||||||
Revenue Recognition | ' | ||||||||||||||||||||
Revenue Recognition | |||||||||||||||||||||
We market and license our products indirectly through channel distributors, independent software vendors (“ISVs”), value-added resellers (“VARs”) (collectively, “resellers”) and directly to corporate enterprises, governmental and educational institutions and others. Our product licenses are perpetual. We also separately sell intellectual property licenses, maintenance contracts, which are comprised of license updates and customer service access, as well as other products and services. | |||||||||||||||||||||
Software license revenues are recognized when: | |||||||||||||||||||||
· | Persuasive evidence of an arrangement exists, (i.e., when we sign a non-cancellable license agreement wherein the customer acknowledges an unconditional obligation to pay, or upon receipt of the customer’s purchase order), and | ||||||||||||||||||||
· | Delivery has occurred or services have been rendered and there are no uncertainties surrounding product acceptance (i.e., when title and risk of loss have been transferred to the customer, which occurs when the media containing the licensed program(s) is provided to a common carrier or, in the case of electronic delivery, when the customer is given access to the licensed program(s)), and | ||||||||||||||||||||
· | The price to the customer is fixed or determinable, as typically evidenced in a signed non-cancellable contract, or a customer’s purchase order, and | ||||||||||||||||||||
· | Collectability is probable. If collectability is not considered probable, revenue is recognized when the fee is collected. | ||||||||||||||||||||
Revenue recognized on software arrangements involving multiple deliverables is allocated to each deliverable based on vendor-specific objective evidence (“VSOE”) or third party evidence of the fair values of each deliverable; such deliverables include licenses for software products, maintenance, private labeling fees, and customer training. We limit our assessment of VSOE for each deliverable to either the price charged when the same deliverable is sold separately or the price established by management having the relevant authority to do so, for a deliverable not yet sold separately. | |||||||||||||||||||||
If sufficient VSOE of the fair value does not exist so as to permit the allocation of revenue to the various elements of the arrangement, all revenue from the arrangement is deferred until such evidence exists or until all elements are delivered. If VSOE of the fair value does not exist, and the only undelivered element is maintenance, then we recognize revenue on a ratable basis. If VSOE of the fair value of all undelivered elements exists but does not exist for one or more delivered elements, then revenue is recognized using the residual method. Under the residual method, the fair value of the undelivered elements is deferred and the remaining portion of the arrangement fee is recognized as revenue. | |||||||||||||||||||||
Certain resellers (“stocking resellers”) purchase product licenses that they hold in inventory until they are resold to the ultimate end user (an “inventory stocking order”). At the time that a stocking reseller places an inventory stocking order, no product licenses are shipped by us to the stocking reseller; rather, the stocking reseller’s inventory is credited with the number of licenses purchased and the stocking reseller can resell (issue) any number of licenses from their inventory at any time. Upon receipt of an order to issue a license(s) from a stocking reseller’s inventory (a “draw down order”), we will ship the license(s) in accordance with the draw down order’s instructions. We defer recognition of revenue from inventory stocking orders until the underlying licenses are sold and shipped to the end user, as evidenced by the receipt and fulfillment of the stocking reseller’s draw down order, assuming all other revenue recognition criteria have been met. | |||||||||||||||||||||
There are no rights of return granted to resellers or other purchasers of our software products. | |||||||||||||||||||||
Revenue from maintenance contracts is recognized ratably over the related contract period, which generally ranges from one to five years. | |||||||||||||||||||||
All of our software licenses are denominated in U.S. dollars. | |||||||||||||||||||||
Deferred Rent | ' | ||||||||||||||||||||
Deferred Rent | |||||||||||||||||||||
The lease for our office in Campbell, California, contains free rent and predetermined fixed escalations in our minimum rent payments. We recognize rent expense related to this lease on a straight-line basis over the term of the lease. We record any difference between the straight-line rent amounts and amounts payable under the lease as part of deferred rent in current or long-term liabilities, as appropriate. | |||||||||||||||||||||
Incentives that we received upon entering into the lease agreement are recognized on a straight-line basis as a reduction to rent over the term of the lease. We record the unamortized portion of these incentives as a part of deferred rent in current or long-term liabilities, as appropriate. | |||||||||||||||||||||
Postemployment Benefits (Severance Liability) | ' | ||||||||||||||||||||
Postemployment Benefits (Severance Liability) | |||||||||||||||||||||
Nonretirement postemployment benefits, including salary continuation, supplemental unemployment benefits, severance benefits, disability-related benefits and continuation of benefits such as health care benefits, are recognized as a liability and a loss when it is probable that the employee(s) will be entitled to such benefits and the amount can be reasonably estimated. The cost of termination benefits recognized as a liability and an expense includes the amount of any lump-sum payments and the present value of any expected future payments. During 2012, we recorded $721,800 of severance expense, including stock compensation expense. Such expense was recorded as a result of a separation agreement and a release with Robert Dilworth in connection with Mr. Dilworth’s resignation as our Chief Executive Officer and as a member of our board of directors. In addition, during 2013 we recorded an additional $75,700 of severance expense as a result of a separation and release agreement we entered into with a former vice president-level employee (as further discussed in Note 5 to Unaudited Condensed Consolidated Financial Statements). An aggregate of $140,100 and $262,400 is reflected as a severance liability, at September 30, 2013 and December 31, 2012, respectively. | |||||||||||||||||||||
Software Development Costs | ' | ||||||||||||||||||||
Software Development Costs | |||||||||||||||||||||
We capitalize software development costs incurred from the time technological feasibility of the software is established until the software is available for general release, in accordance with GAAP. Such capitalized costs are subsequently amortized as costs of revenue over the shorter of three years or the remaining estimated useful life of the product. | |||||||||||||||||||||
Research and development costs and other computer software maintenance costs related to the software development are expensed as incurred. | |||||||||||||||||||||
Long-Lived Assets | ' | ||||||||||||||||||||
Long-Lived Assets | |||||||||||||||||||||
Long-lived assets are assessed for possible impairment whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable, whenever we have committed to a plan to dispose of the assets or, at a minimum, annually. Typically, for long-lived assets to be held and used, measurement of an impairment loss is based on the fair value of such assets, with fair value being determined based on appraisals, current market value, comparable sales value, and discounted future cash flows, among other variables, as appropriate. Assets to be held and used (which assets are affected by an impairment loss) are depreciated or amortized at their new carrying amount over their remaining estimated life; assets to be sold or otherwise disposed of are not subject to further depreciation or amortization. No such impairment charge was recorded during either of the three or nine-month periods ended September 30, 2013 or 2012. | |||||||||||||||||||||
Allowance for Doubtful Accounts | ' | ||||||||||||||||||||
Allowance for Doubtful Accounts | |||||||||||||||||||||
We maintain an allowance for doubtful accounts that reflects our best estimate of potentially uncollectible trade receivables. The allowance is based on assessments of the collectability of specific customer accounts and the general aging and size of the accounts receivable. We regularly review the adequacy of our allowance for doubtful accounts by considering such factors as historical experience, credit worthiness, and current economic conditions that may affect a customer’s ability to pay. We specifically reserve for those accounts deemed uncollectible. We also establish, and adjust, a general allowance for doubtful accounts based on our review of the aging and size of our accounts receivable. | |||||||||||||||||||||
The following table sets forth the details of the Allowance for Doubtful Accounts for the three and nine-month periods ended September 30, 2013 and 2012: | |||||||||||||||||||||
Beginning Balance | Charge Offs | Recoveries | Provision | Ending Balance | |||||||||||||||||
Three Months Ended September 30, | |||||||||||||||||||||
2013 | $ | 24,600 | $ | — | $ | — | $ | 5,000 | $ | 29,600 | |||||||||||
2012 | 37,900 | — | — | (7,700 | ) | 30,200 | |||||||||||||||
Nine Months Ended September 30, | |||||||||||||||||||||
2013 | $ | 33,900 | $ | — | $ | — | $ | (4,300 | ) | $ | 29,600 | ||||||||||
2012 | 25,000 | — | — | 5,200 | 30,200 | ||||||||||||||||
Concentration of Credit Risk | ' | ||||||||||||||||||||
Concentration of Credit Risk | |||||||||||||||||||||
For the three and nine-month periods ended September 30, 2013 and 2012 respectively, we considered the customers listed in the following tables to be our most significant customers. The tables set forth the percentage of sales attributable to each customer for the three and nine-month periods ended September 30, 2013 and 2012, and the respective customer’s ending accounts receivable balance as a percentage of reported accounts receivable, net, as of September 30, 2013 and 2012. | |||||||||||||||||||||
Three Months Ended | Three Months Ended | ||||||||||||||||||||
30-Sep-13 | 30-Sep-12 | ||||||||||||||||||||
Customer | Sales | Accounts Receivable | Sales | Accounts Receivable | |||||||||||||||||
Elosoft | 10.4 | % | 15.1 | % | 7.2 | % | 10.7 | % | |||||||||||||
IDS | 9.9 | % | 4.5 | % | 8.7 | % | 1.2 | % | |||||||||||||
GE | 9.7 | % | 16.5 | % | 10.1 | % | 19.8 | % | |||||||||||||
Alcatel-Lucent | 8.4 | % | 16.2 | % | 7.2 | % | 14.3 | % | |||||||||||||
GAD | 6.4 | % | — | 5.5 | % | — | |||||||||||||||
Total | 44.8 | % | 52.3 | % | 38.7 | % | 46 | % | |||||||||||||
Nine Months Ended | Nine Months Ended | ||||||||||||||||||||
30-Sep-13 | 30-Sep-12 | ||||||||||||||||||||
Customer | Sales | Accounts Receivable | Sales | Accounts Receivable | |||||||||||||||||
Elosoft | 6.3 | % | 15.1 | % | 5.5 | % | 10.7 | % | |||||||||||||
IDS | 6.6 | % | 4.5 | % | 5.4 | % | 1.2 | % | |||||||||||||
GE | 6.8 | % | 16.5 | % | 8.1 | % | 19.8 | % | |||||||||||||
Alcatel-Lucent | 7.5 | % | 16.2 | % | 4.8 | % | 14.3 | % | |||||||||||||
GAD | 4.7 | % | — | 10.5 | % | — | |||||||||||||||
Total | 31.9 | % | 52.3 | % | 34.3 | % | 46 | % | |||||||||||||
Derivative Financial Instruments | ' | ||||||||||||||||||||
Derivative Financial Instruments | |||||||||||||||||||||
We currently do not have a material exposure to either commodity prices or interest rates; accordingly, we do not currently use derivative instruments to manage such risks. We evaluate all of our financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. All derivative financial instruments are recognized in the balance sheet at fair value. Changes in fair value are recognized in earnings if they are not eligible for hedge accounting or in other comprehensive income if they qualify for cash flow hedge accounting. | |||||||||||||||||||||
Fair Value of Financial Instruments | ' | ||||||||||||||||||||
Fair Value of Financial Instruments | |||||||||||||||||||||
The fair value of our accounts receivable, accounts payable and accrued liabilities approximate their carrying amounts due to the relative short maturities of these items. | |||||||||||||||||||||
The fair value of warrants at issuance and for those recorded as a liability at each reporting date are determined in accordance with the Financial Account Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) 820, “Fair Value Measurement,” which establishes a fair value hierarchy that prioritizes the assumptions (inputs) to valuation techniques used to price assets or liabilities that are measured at fair value. The hierarchy, as defined below, gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The guidance for fair value measurements requires that assets, liabilities and certain equity instruments measured at fair value be classified and disclosed in one of the following categories: | |||||||||||||||||||||
· | Level 1: Defined as observable inputs, such as quoted (unadjusted) prices in active markets for identical assets or liabilities. | ||||||||||||||||||||
· | Level 2: Defined as observable inputs other than quoted prices included in Level 1. This includes quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | ||||||||||||||||||||
· | Level 3: Defined as unobservable inputs to the valuation methodology that are supported by little or no market activity and that are significant to the measurement of the fair value of the assets or liabilities. Level 3 assets and liabilities include those whose fair value measurements are determined using pricing models, discounted cash flow methodologies or similar valuation techniques, as well as significant management judgment or estimation. | ||||||||||||||||||||
As of September 30, 2013, all of our $1,968,800 Warrants Liability reported at fair value was categorized as Level 3 inputs (See Note 4). | |||||||||||||||||||||
Recent Accounting Pronouncements | ' | ||||||||||||||||||||
Recent Accounting Pronouncements | |||||||||||||||||||||
In July 2013, FASB issued ASU No. 2013-11 “Income Taxes (Topic 740)” (ASU 2013-11). The objective of ASU 2013-11 is to provide explicit guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. FASB recognized that there was inconsistency in how previous guidance in this topic was applied in practice, thus; the objective of ASU 2013-11 is to eliminate the diversity of how previous guidance was applied. As the amendments in ASU 2013-11 do not require new recurring disclosures, rather, they are aimed at creating consistency in how previous guidance is applied, we do not believe that adoption of ASU 2013-11, which will become effective for fiscal years, and interim periods within those years, beginning after December 15, 2013, will have a material impact on our results of operations, cash flows or financial position. | |||||||||||||||||||||
In February 2013, FASB issued ASU No. 2013-02 “Other Comprehensive Income” (ASU 2013-02). The objective of ASU 2013-02 is to improve the reporting of reclassifications out of other comprehensive income. This objective is reached by requiring an entity to report the effect of significant reclassifications out of accumulated other comprehensive income on the respective line items in net income if the amount being reclassified is required under GAAP to be reclassified in its entirety to net income. ASU 2013-02 is effective and is to be applied prospectively to reporting periods beginning after December 15, 2012. We currently have no amounts that would meet the criteria to be reclassified; accordingly, the adoption of ASU 2013-02 did not have a material impact on our results of operations, cash flows or financial position. Comprehensive loss equals net loss for the each of the three and nine-month periods ended September 30, 2013 and 2012, respectively. | |||||||||||||||||||||
In July 2012, FASB issued ASU No. 2012-02 “Intangibles – Goodwill and Other” (ASU 2012-02). The objective of ASU 2012-02 is to reduce the cost and complexity of performing an impairment test for indefinite-lived intangible assets by simplifying how an entity tests those assets for impairment and to improve consistency in impairment testing guidance among long-lived asset categories. ASU 2012-02 is effective for fiscal years beginning after September 15, 2012. Early adoption is permitted. We currently have no goodwill or material indefinite-lived intangible assets; accordingly, the adoption of ASU 2012-02 did not have a material impact on our results of operations, cash flows or financial position. | |||||||||||||||||||||
Significant_Accounting_Policie2
Significant Accounting Policies (Tables) | 9 Months Ended | ||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||
Significant Accounting Policies [Abstract] | ' | ||||||||||||||||||||
Allowance for doubtful accounts | ' | ||||||||||||||||||||
The following table sets forth the details of the Allowance for Doubtful Accounts for the three and nine-month periods ended September 30, 2013 and 2012: | |||||||||||||||||||||
Beginning Balance | Charge Offs | Recoveries | Provision | Ending Balance | |||||||||||||||||
Three Months Ended September 30, | |||||||||||||||||||||
2013 | $ | 24,600 | $ | — | $ | — | $ | 5,000 | $ | 29,600 | |||||||||||
2012 | 37,900 | — | — | (7,700 | ) | 30,200 | |||||||||||||||
Nine Months Ended September 30, | |||||||||||||||||||||
2013 | $ | 33,900 | $ | — | $ | — | $ | (4,300 | ) | $ | 29,600 | ||||||||||
2012 | 25,000 | — | — | 5,200 | 30,200 | ||||||||||||||||
Schedule of most significant customers | ' | ||||||||||||||||||||
For the three and nine-month periods ended September 30, 2013 and 2012 respectively, we considered the customers listed in the following tables to be our most significant customers. The tables set forth the percentage of sales attributable to each customer for the three and nine-month periods ended September 30, 2013 and 2012, and the respective customer’s ending accounts receivable balance as a percentage of reported accounts receivable, net, as of September 30, 2013 and 2012. | |||||||||||||||||||||
Three Months Ended | Three Months Ended | ||||||||||||||||||||
30-Sep-13 | 30-Sep-12 | ||||||||||||||||||||
Customer | Sales | Accounts Receivable | Sales | Accounts Receivable | |||||||||||||||||
Elosoft | 10.4 | % | 15.1 | % | 7.2 | % | 10.7 | % | |||||||||||||
IDS | 9.9 | % | 4.5 | % | 8.7 | % | 1.2 | % | |||||||||||||
GE | 9.7 | % | 16.5 | % | 10.1 | % | 19.8 | % | |||||||||||||
Alcatel-Lucent | 8.4 | % | 16.2 | % | 7.2 | % | 14.3 | % | |||||||||||||
GAD | 6.4 | % | — | 5.5 | % | — | |||||||||||||||
Total | 44.8 | % | 52.3 | % | 38.7 | % | 46 | % | |||||||||||||
Nine Months Ended | Nine Months Ended | ||||||||||||||||||||
30-Sep-13 | 30-Sep-12 | ||||||||||||||||||||
Customer | Sales | Accounts Receivable | Sales | Accounts Receivable | |||||||||||||||||
Elosoft | 6.3 | % | 15.1 | % | 5.5 | % | 10.7 | % | |||||||||||||
IDS | 6.6 | % | 4.5 | % | 5.4 | % | 1.2 | % | |||||||||||||
GE | 6.8 | % | 16.5 | % | 8.1 | % | 19.8 | % | |||||||||||||
Alcatel-Lucent | 7.5 | % | 16.2 | % | 4.8 | % | 14.3 | % | |||||||||||||
GAD | 4.7 | % | — | 10.5 | % | — | |||||||||||||||
Total | 31.9 | % | 52.3 | % | 34.3 | % | 46 | % |
Property_and_Equipment_Tables
Property and Equipment (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Property and Equipment [Abstract] | ' | ||||||||
Property and equipment | ' | ||||||||
Property and equipment was: | |||||||||
30-Sep-13 | 31-Dec-12 | ||||||||
Equipment | $ | 1,238,800 | $ | 1,171,900 | |||||
Furniture | 392,800 | 380,200 | |||||||
Leasehold improvements | 147,500 | 147,500 | |||||||
1,779,100 | 1,699,600 | ||||||||
Less: accumulated depreciation and amortization | 1,421,300 | 1,340,700 | |||||||
$ | 357,800 | $ | 358,900 |
Liability_Attributable_to_Warr1
Liability Attributable to Warrants (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Liability Attributable to Warrants [Abstract] | ' | ||||||||||||||||
Assumption used to determine the fair value of warrants | ' | ||||||||||||||||
We used a binomial pricing model to determine the fair value of our warrants liability as of September 30, 2013 and December 31, 2012, the balance sheet dates, using the following assumptions: | |||||||||||||||||
2011 Transaction | ipCapital | ||||||||||||||||
30-Sep-13 | 31-Dec-12 | 30-Sep-13 | 31-Dec-12 | ||||||||||||||
Estimated volatility | 120 | % | 159 | % | 125 | % | 163 | % | |||||||||
Annualized forfeiture rate | — | — | — | — | |||||||||||||
Expected option term (years) | 2.92 | 3.67 | 3.04 | 3.79 | |||||||||||||
Estimated exercise factor | 4 | 10 | 4 | 10 | |||||||||||||
Risk-free interest rate | 0.5 | % | 0.45 | % | 0.64 | % | 0.65 | % | |||||||||
Dividends | — | — | — | — | |||||||||||||
Reconciliation of the warrants liability measured at fair value using significant unobservable inputs | ' | ||||||||||||||||
The following table is a reconciliation of the warrants liability measured at fair value using significant unobservable inputs (Level 3) for the nine months ended September 30, 2013: | |||||||||||||||||
Warrants liability – December 31, 2012 fair value | $ | 7,390,100 | |||||||||||||||
Change in fair value of warrant liability recorded in other income | (680,100 | ) | |||||||||||||||
Change in fair value of warrant liability recorded in general and administrative expense | 35,700 | ||||||||||||||||
Reclassification of warrants liability to equity from exercise of warrants (1) | (385,900 | ) | |||||||||||||||
Reclassification of warrants liability to equity from amendment to warrants (1) | (4,391,000 | ) | |||||||||||||||
Warrants liability – September 30, 2013 fair value | $ | 1,968,800 | |||||||||||||||
-1 | During the nine-month period ended September 30, 2013, our warrants liability was reduced as a result of the warrants amendment, as discussed above. Additionally, our warrants liability was further reduced by $385,900 as a result of the exercise of 1,072,500 warrants during such period, whose terms were not affected by the changes made under the warrants amendment. The aggregate reduction in the liability, combining the warrant amendment and this exercise, was $4,776,900. See Note 13. | ||||||||||||||||
Warrants outstanding | ' | ||||||||||||||||
The following tables reconcile the number of warrants outstanding for the periods indicated: | |||||||||||||||||
For the Three-Month Period Ended September 30, 2013 | |||||||||||||||||
Beginning Outstanding | Exercised | Ending Outstanding | |||||||||||||||
Issued | |||||||||||||||||
2011 Transaction | 13,157,500 | — | 305,000 | 12,852,500 | |||||||||||||
Exercise Agreement | 4,500,000 | — | — | 4,500,000 | |||||||||||||
ipCapital | 400,000 | — | — | 400,000 | |||||||||||||
Consultant Warrant (1) | — | 312,500 | — | 312,500 | |||||||||||||
Offer to Exercise | — | 152,500 | — | 152,500 | |||||||||||||
Total | 18,057,500 | 465,000 | 305,000 | 18,217,500 | |||||||||||||
For the Nine-Month Period Ended September 30, 2013 | |||||||||||||||||
Beginning Outstanding | Exercised | Ending Outstanding | |||||||||||||||
Issued | |||||||||||||||||
2011 Transaction | 23,075,000 | — | 10,222,500 | 12,852,500 | |||||||||||||
Exercise Agreement | — | 4,500,000 | — | 4,500,000 | |||||||||||||
ipCapital | 400,000 | — | — | 400,000 | |||||||||||||
Consulting Warrant (1) | — | 312,500 | — | 312,500 | |||||||||||||
Offer to Exercise | — | 152,500 | — | 152,500 | |||||||||||||
Total | 23,475,000 | 4,965,000 | 10,222,500 | 18,217,500 | |||||||||||||
For the Three and Nine-Month Period Ended September 30, 2012 | |||||||||||||||||
Beginning Outstanding | Exercised | Ending Outstanding | |||||||||||||||
Issued | |||||||||||||||||
2011 Transaction | 23,075,000 | — | — | 23,075,000 | |||||||||||||
ipCapital | 400,000 | — | — | 400,000 | |||||||||||||
Total | 23,475,000 | — | — | 23,475,000 | |||||||||||||
(1) Effective September 18, 2013, we entered into a consulting agreement with Genesis Select to provide us with a variety of investor relations services. As part of their compensation, we issued to them a warrant to purchase 312,500 shares of our common stock at an exercise price of $0.50 per share. The warrant will vest, monthly, over the initial twelve-month service period of the contract, assuming that the agreement remains in-force, with the first vesting having occured on October 18, 2013. The warrant is substantially similar in nature to those issued in the warrant amendment, discussed above, thus; the warrant is accounted in equity and is not included as a component of our warrants liability as of September 30, 2013. We used the following assumptions in a binomial pricing model to calculate the fair value of the warrant issued to Genesis: estimated volatility – 181%; expected term – 4.96 years; estimated exercise factor – 4, risk free interest rate – 1.41%; and dividends – 0. Expense associated with this warrant is recognized as a component of general and administrative expense over the one-year vesting term of the warrant. |
Severance_Liability_Tables
Severance Liability (Tables) | 9 Months Ended | ||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||
Severance Liability [Abstract] | ' | ||||||||||||||||||||||||
Fair value of stock-based award granted | ' | ||||||||||||||||||||||||
We estimated the fair value of each stock-based award set forth above, which were included as part of Mr. Dilworth’s separation agreement during 2012, using a binomial model with the assumptions set forth in the following table: | |||||||||||||||||||||||||
Estimated Volatility | Annualized Forfeiture Rate | Expected Option Term (Years) | Estimated Exercise Factor | Risk-Free Interest Rate | Dividends | ||||||||||||||||||||
Modified options | 70% - 157 | % | 0 | % | 0.25 – 2.5 | 10 | 0.08% - 0.29 | % | — | ||||||||||||||||
New option | 157 | % | 0 | % | 2.5 | 10 | 0.29 | % | |||||||||||||||||
Salary continuation and medical coverage payments | ' | ||||||||||||||||||||||||
The following table summarizes the salary continuation and medical coverage payments during the nine-month period ended September 30, 2013. | |||||||||||||||||||||||||
Compensation | Medical Coverage | Total | |||||||||||||||||||||||
Balance at December 31, 2012 | $ | 250,100 | $ | 12,300 | $ | 262,400 | |||||||||||||||||||
Separation agreement entered into in 2013 | 60,000 | 15,700 | 75,700 | ||||||||||||||||||||||
Accrued interest | 18,100 | 700 | 18,800 | ||||||||||||||||||||||
Payments | (197,200 | ) | (19,600 | ) | (216,800 | ) | |||||||||||||||||||
Balance at September 30, 2013 | $ | 131,000 | $ | 9,100 | $ | 140,100 | |||||||||||||||||||
Deferred_Rent_Tables
Deferred Rent (Tables) | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Deferred Rent [Abstract] | ' | ||||||||||||
Schedule of deferred rent | ' | ||||||||||||
As of September 30, 2013 deferred rent was: | |||||||||||||
Component | Current Liabilities | Long-Term Liabilities | Total | ||||||||||
Deferred rent expense | $ | 5,800 | $ | 38,500 | $ | 44,300 | |||||||
Deferred rent benefit | 24,000 | 66,000 | 90,000 | ||||||||||
$ | 29,800 | $ | 104,500 | $ | 134,300 | ||||||||
As of December 31, 2012 deferred rent was: | |||||||||||||
Component | Current Liabilities | Long-Term Liabilities | Total | ||||||||||
Deferred rent expense | $ | 2,700 | $ | 43,500 | $ | 46,200 | |||||||
Deferred rent benefit | 24,000 | 84,000 | 108,000 | ||||||||||
$ | 26,700 | $ | 127,500 | $ | 154,200 |
StockBased_Compensation_Tables
Stock-Based Compensation (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Stock-Based Compensation [Abstract] | ' | ||||||||||||||||
Summary of stock-based compensation expense | ' | ||||||||||||||||
The following table summarizes the stock-based compensation expense, net of amounts capitalized, we recorded in our Unaudited Condensed Consolidated Statements of Operations for the three and nine-month periods ended September 30, 2013 and 2012, respectively, by classification: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
Statement of Operations Classification | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Costs of revenue | $ | (500 | ) | $ | 6,700 | $ | 3,300 | $ | 17,100 | ||||||||
Selling and marketing expense | 39,800 | 33,200 | 118,700 | 84,800 | |||||||||||||
General and administrative expense | 76,300 | 71,000 | 255,800 | 404,700 | |||||||||||||
Research and development expense | 74,400 | 82,600 | 202,700 | 252,400 | |||||||||||||
$ | 190,000 | $ | 193,500 | $ | 580,500 | $ | 759,000 | ||||||||||
Summary of status and activity of stock option awards | ' | ||||||||||||||||
The following table presents summaries of the status and activity of our stock option awards for the three-month period ended September 30, 2013. | |||||||||||||||||
Number of Shares | Weighted Average Exercise | Weighted Average | Aggregate Intrinsic Value | ||||||||||||||
Price | Remaining Contractual | ||||||||||||||||
Terms (Years) | |||||||||||||||||
Outstanding – June 30, 2013 | 13,134,398 | $ | 0.2 | ||||||||||||||
Granted | 23,000 | 0.44 | |||||||||||||||
Exercised | (708,594 | ) | 0.18 | ||||||||||||||
Forfeited or expired | (77,745 | ) | 0.2 | ||||||||||||||
Outstanding – September 30, 2013 | 12,371,059 | $ | 0.2 | 6.12 | $ | 4,161,600 | |||||||||||
The following table presents summaries of the status and activity of our stock option awards for the nine-month period ended September 30, 2013. | |||||||||||||||||
Number of Shares | Weighted Average Exercise | Weighted Average | Aggregate Intrinsic Value | ||||||||||||||
Price | Remaining Contractual | ||||||||||||||||
Terms (Years) | |||||||||||||||||
Outstanding – December 31, 2012 | 14,174,000 | $ | 0.2 | ||||||||||||||
Granted | 23,000 | 0.44 | |||||||||||||||
Exercised | (1,459,972 | ) | 0.17 | ||||||||||||||
Forfeited or expired | (232,151 | ) | 0.2 | ||||||||||||||
Cancellation of unearned performance option | (133,818 | ) | 0.19 | ||||||||||||||
Outstanding – September 30, 2013 | 12,371,059 | $ | 0.2 | 6.12 | $ | 4,161,600 | |||||||||||
Summary of status and activity of restricted stock awards | ' | ||||||||||||||||
The following table presents summaries of the status and activity of our restricted stock awards for the three-month period ended September 30, 2013. We include the common stock underlying the restricted stock award in shares outstanding once such common stock has vested and the restriction has been removed (“releases” or “released”).The common stock vests ratably, over a 33-month period; however, no such shares vest until after three months from the date of the restricted stock award. | |||||||||||||||||
Number of Shares | Weighted Average Grant Date Fair Value | Weighted Average | Unrecognized Compensation Cost Remaining | ||||||||||||||
Remaining Recognition P | |||||||||||||||||
eriod (Years) | |||||||||||||||||
Unreleased – June 30, 2013 | 3,796,324 | $ | 0.22 | ||||||||||||||
Awarded | 1,027,500 | 0.42 | |||||||||||||||
Released | (432,521 | ) | 0.23 | ||||||||||||||
Forfeited | (265,157 | ) | 0.27 | ||||||||||||||
Outstanding – September 30, 2013 | 4,126,146 | $ | 0.26 | 2.15 | $ | 918,400 | |||||||||||
The following table presents summaries of the status and activity of our restricted stock awards for the nine-month period ended September 30, 2013. | |||||||||||||||||
Number of Shares | Weighted Average Grant Date Fair Value | Weighted Average | Unrecognized Compensation Cost Remaining | ||||||||||||||
Remaining Recognition | |||||||||||||||||
Period (Years) | |||||||||||||||||
Unreleased – December 31, 2012 | 4,043,123 | $ | 0.18 | ||||||||||||||
Awarded | 1,607,500 | 0.42 | |||||||||||||||
Released | (1,208,412 | ) | 0.21 | ||||||||||||||
Forfeited | (316,065 | ) | 0.36 | ||||||||||||||
Outstanding – September 30, 2013 | 4,126,146 | $ | 0.26 | 2.15 | $ | 918,400 |
Revenue_Tables
Revenue (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Revenue [Abstract] | ' | ||||||||||||||||
Schedule of revenue | ' | ||||||||||||||||
Revenue for the three-month periods ended September 30, 2013 and 2012 was: | |||||||||||||||||
Three Months Ended | 2013 Over (Under) 2012 | ||||||||||||||||
September 30, | |||||||||||||||||
Revenue | 2013 | 2012 | Dollars | Percent | |||||||||||||
Software Licenses | |||||||||||||||||
Windows | $ | 559,600 | $ | 775,600 | $ | (216,000 | ) | -27.8 | % | ||||||||
UNIX/Linux | 219,900 | 234,200 | (14,300 | ) | -6.1 | % | |||||||||||
779,500 | 1,009,800 | (230,300 | ) | -22.8 | % | ||||||||||||
Software Service Fees | |||||||||||||||||
Windows | 511,300 | 469,200 | 42,100 | 9 | % | ||||||||||||
UNIX/Linux | 226,500 | 232,700 | (6,200 | ) | -2.7 | % | |||||||||||
737,800 | 701,900 | 35,900 | 5.1 | % | |||||||||||||
Other | 17,400 | 22,400 | (5,000 | ) | -22.3 | % | |||||||||||
Total Revenue | $ | 1,534,700 | $ | 1,734,100 | $ | (199,400 | ) | -11.5 | % | ||||||||
Revenue for the nine-month periods ended September 30, 2013 and 2012 was: | |||||||||||||||||
Nine Months Ended | 2013 Over (Under) 2012 | ||||||||||||||||
September 30, | |||||||||||||||||
Revenue | 2013 | 2012 | Dollars | Percent | |||||||||||||
Software Licenses | |||||||||||||||||
Windows | $ | 1,673,400 | $ | 2,046,200 | $ | (372,800 | ) | -18.2 | % | ||||||||
UNIX/Linux | 670,100 | 724,300 | (54,200 | ) | -7.5 | % | |||||||||||
2,343,500 | 2,770,500 | (427,000 | ) | -15.4 | % | ||||||||||||
Software Service Fees | |||||||||||||||||
Windows | 1,471,700 | 1,338,800 | 132,900 | 9.9 | % | ||||||||||||
UNIX/Linux | 686,300 | 705,000 | (18,700 | ) | -2.7 | % | |||||||||||
2,158,000 | 2,043,800 | 114,200 | 5.6 | % | |||||||||||||
Other | 44,000 | 101,300 | (57,300 | ) | -56.6 | % | |||||||||||
Total Revenue | $ | 4,545,500 | $ | 4,915,600 | $ | (370,100 | ) | -7.5 | % |
Cost_of_Revenue_Tables
Cost of Revenue (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Cost of Revenue [Abstract] | ' | ||||||||||||||||
Schedule of cost of revenue | ' | ||||||||||||||||
Cost of revenue for the three-month periods ended September 30, 2013 and 2012 was: | |||||||||||||||||
Three Months Ended | 2013 Over (Under) 2012 | ||||||||||||||||
September 30, | |||||||||||||||||
2013 | 2012 | Dollars | Percent | ||||||||||||||
Software service costs | $ | 64,100 | $ | 97,500 | $ | (33,400 | ) | -34.3 | % | ||||||||
Software product costs | 36,400 | 63,200 | (26,800 | ) | -42.4 | % | |||||||||||
$ | 100,500 | $ | 160,700 | $ | (60,200 | ) | -37.5 | % | |||||||||
Cost of revenue for the nine-month periods ended September 30, 2013 and 2012 was: | |||||||||||||||||
Nine Months Ended | 2013 Over (Under) 2012 | ||||||||||||||||
September 30, | |||||||||||||||||
2013 | 2012 | Dollars | Percent | ||||||||||||||
Software service costs | $ | 191,900 | $ | 233,000 | $ | (41,100 | ) | -17.6 | % | ||||||||
Software product costs | 157,700 | 198,600 | (40,900 | ) | -20.6 | % | |||||||||||
$ | 349,600 | $ | 431,600 | $ | (82,000 | ) | -19 | % | |||||||||
Capitalized_Software_Developme1
Capitalized Software Development Costs (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Capitalized Software Development Costs [Abstract] | ' | ||||||||
Schedule of capitalized software | ' | ||||||||
Capitalized software development costs consisted of the following: | |||||||||
30-Sep-13 | 31-Dec-12 | ||||||||
Software development costs | $ | 1,116,700 | $ | 573,100 | |||||
Accumulated amortization | (457,100 | ) | (350,000 | ) | |||||
$ | 659,600 | $ | 223,100 | ||||||
Segment_Information_Tables
Segment Information (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Segment Information [Abstract] | ' | ||||||||||||||||
Segment revenue | ' | ||||||||||||||||
Segment revenue for the three-month periods ended September 30, 2013 and 2012 was as follows: | |||||||||||||||||
Increase (Decrease) | |||||||||||||||||
2013 | 2012 | Dollars | Percentage | ||||||||||||||
GO-Global | $ | 1,534,700 | $ | 1,734,100 | $ | (199,400 | ) | -11.5 | % | ||||||||
hopTo | — | — | — | n/ | a | ||||||||||||
Consolidated Total | $ | 1,534,700 | $ | 1,734,100 | $ | (199,400 | ) | -11.5 | % | ||||||||
Segment revenue for the nine-month periods ended September 30, 2013 and 2012 was as follows: | |||||||||||||||||
Increase (Decrease) | |||||||||||||||||
2013 | 2012 | Dollars | Percentage | ||||||||||||||
GO-Global | $ | 4,545,500 | $ | 4,915,600 | $ | (370,100 | ) | -7.5 | % | ||||||||
hopTo | — | — | — | n/ | a | ||||||||||||
Consolidated Total | $ | 4,545,500 | $ | 4,915,600 | $ | (370,100 | ) | -7.5 | % | ||||||||
Segment loss from operations | ' | ||||||||||||||||
Segment loss from continuing operations for the three and nine-month periods ended September 30, 3013 and 2012 was as follows: | |||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
GO-Global | $ | 800 | $ | 413,000 | $ | (204,500 | ) | $ | (591,000 | ) | |||||||
hopTo | (1,609,300 | ) | (1,067,800 | ) | (3,318,000 | ) | (2,835,200 | ) | |||||||||
Total | $ | (1,608,500 | ) | $ | (654,800 | ) | $ | (3,522,500 | ) | $ | (3,426,200 | ) | |||||
Segment fixed assets | ' | ||||||||||||||||
As of September 30, 2013 segment fixed assets (long-lived assets) were as follows: | |||||||||||||||||
Accumulated | |||||||||||||||||
Depreciation | |||||||||||||||||
Cost Basis | /Amortization | Net | |||||||||||||||
GO-Global | $ | 1,964,900 | $ | (1,799,100 | ) | $ | 165,800 | ||||||||||
hopTo | 930,800 | (79,200 | ) | 851,600 | |||||||||||||
Total from continuing operations | 2,895,700 | (1,878,300 | ) | 1,017,400 | |||||||||||||
Discontinued operations | 2,839,000 | (2,839,000 | ) | — | |||||||||||||
Unallocated | 31,700 | — | 31,700 | ||||||||||||||
Total | $ | 5,766,400 | $ | (4,717,300 | ) | $ | 1,049,100 | ||||||||||
Revenue based on geographical location | ' | ||||||||||||||||
Go-Global software revenue by country for the three-and nine month periods ended September 30, 2013 and 2012 was as follows: | |||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
Revenue by Country | 2013 | 2012 | 2013 | 2012 | |||||||||||||
United States | $ | 677,600 | $ | 668,800 | $ | 1,886,000 | $ | 1,980,100 | |||||||||
Germany | 84,600 | 181,000 | 354,200 | 533,300 | |||||||||||||
Brazil | 161,000 | 176,400 | 415,100 | 444,800 | |||||||||||||
Other Countries | 611,500 | 707,900 | 1,890,200 | 1,957,400 | |||||||||||||
Total | $ | 1,534,700 | $ | 1,734,100 | $ | 4,545,500 | $ | 4,915,600 | |||||||||
Subsequent_Events_Tables
Subsequent Events (Tables) | 9 Months Ended | ||||
Sep. 30, 2013 | |||||
Subsequent Events [Abstract] | ' | ||||
Future minimum lease payments for operating leases | ' | ||||
The amended lease becomes effective November 1, 2013 and will expire on October 31, 2018. The lease contains rent escalation clauses and four months of free rent. Additionally, we paid $18,100 to the landlord as a prepayment of the first month’s rent on the new space. The following table sets forth the minimum lease payments due over the life of the lease. | |||||
Year | Amount | ||||
Remainder of 2013 | $ | — | |||
2014 | 346,000 | ||||
2015 | 449,500 | ||||
2016 | 463,000 | ||||
2017 | 476,900 | ||||
2018 | 407,300 | ||||
$ | 2,142,700 |
Significant_Accounting_Policie3
Significant Accounting Policies (Details) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Mar. 31, 2013 | Mar. 31, 2012 | |
Element | |||||||
Revenue Recognition [Abstract] | ' | ' | ' | ' | ' | ' | ' |
Number of delivered elements for which evidence does not exist, minimum | ' | ' | 1 | ' | ' | ' | ' |
Postemployment Benefits (Severance Liability) [Abstract] | ' | ' | ' | ' | ' | ' | ' |
Severance costs | $75,700 | ' | ' | ' | $721,800 | ' | ' |
Severance liability | 140,100 | ' | 140,100 | ' | 262,400 | ' | ' |
Software Development Costs [Abstract] | ' | ' | ' | ' | ' | ' | ' |
Maximum useful life | ' | ' | '3 years | ' | ' | ' | ' |
Long-Lived Assets [Abstract] | ' | ' | ' | ' | ' | ' | ' |
Impairment charge | 0 | 0 | 0 | 0 | ' | ' | ' |
Allowance for Doubtful Accounts [Abstract] | ' | ' | ' | ' | ' | ' | ' |
Beginning Balance | ' | ' | 33,900 | 25,000 | 25,000 | 24,600 | 37,900 |
Charge Offs | 0 | 0 | 0 | 0 | ' | ' | ' |
Recoveries | 0 | 0 | 0 | 0 | ' | ' | ' |
Provision | 5,000 | -7,700 | -4,300 | 5,200 | ' | ' | ' |
Ending Balance | 29,600 | 30,200 | 29,600 | 30,200 | 33,900 | 24,600 | 37,900 |
Fair Value of Financial Instruments [Abstract] | ' | ' | ' | ' | ' | ' | ' |
Warrants liability reported | $1,968,800 | ' | $1,968,800 | ' | $7,390,100 | ' | ' |
Sales [Member] | ' | ' | ' | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Concentration of risk (in hundredths) | 44.80% | 38.70% | 31.90% | 34.30% | ' | ' | ' |
Sales [Member] | Elosoft [Member] | ' | ' | ' | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Concentration of risk (in hundredths) | 10.40% | 7.20% | 6.30% | 5.50% | ' | ' | ' |
Sales [Member] | IDS [Member] | ' | ' | ' | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Concentration of risk (in hundredths) | 9.90% | 8.70% | 6.60% | 5.40% | ' | ' | ' |
Sales [Member] | GE [Member] | ' | ' | ' | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Concentration of risk (in hundredths) | 9.70% | 10.10% | 6.80% | 8.10% | ' | ' | ' |
Sales [Member] | Alcatel-Lucent [Member] | ' | ' | ' | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Concentration of risk (in hundredths) | 8.40% | 7.20% | 7.50% | 4.80% | ' | ' | ' |
Sales [Member] | GAD [Member] | ' | ' | ' | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Concentration of risk (in hundredths) | 6.40% | 5.50% | 4.70% | 10.50% | ' | ' | ' |
Accounts Receivable [Member] | ' | ' | ' | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Concentration of risk (in hundredths) | 52.30% | 46.00% | 52.30% | 46.00% | ' | ' | ' |
Accounts Receivable [Member] | Elosoft [Member] | ' | ' | ' | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Concentration of risk (in hundredths) | 15.10% | 10.70% | 15.10% | 10.70% | ' | ' | ' |
Accounts Receivable [Member] | IDS [Member] | ' | ' | ' | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Concentration of risk (in hundredths) | 4.50% | 1.20% | 4.50% | 1.20% | ' | ' | ' |
Accounts Receivable [Member] | GE [Member] | ' | ' | ' | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Concentration of risk (in hundredths) | 16.50% | 19.80% | 16.50% | 19.80% | ' | ' | ' |
Accounts Receivable [Member] | Alcatel-Lucent [Member] | ' | ' | ' | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Concentration of risk (in hundredths) | 16.20% | 14.30% | 16.20% | 14.30% | ' | ' | ' |
Accounts Receivable [Member] | GAD [Member] | ' | ' | ' | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Concentration of risk (in hundredths) | 0.00% | 0.00% | 0.00% | 0.00% | ' | ' | ' |
Minimum [Member] | ' | ' | ' | ' | ' | ' | ' |
Revenue Recognition [Abstract] | ' | ' | ' | ' | ' | ' | ' |
Maintenance contract period | ' | ' | '1 year | ' | ' | ' | ' |
Maximum [Member] | ' | ' | ' | ' | ' | ' | ' |
Revenue Recognition [Abstract] | ' | ' | ' | ' | ' | ' | ' |
Maintenance contract period | ' | ' | '5 years | ' | ' | ' | ' |
Property_and_Equipment_Details
Property and Equipment (Details) (USD $) | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | |
Summary of property and equipment [Abstract] | ' | ' | ' |
Property and equipment, gross | $1,779,100 | $1,779,100 | $1,699,600 |
Less: accumulated depreciation and amortization | 1,421,300 | 1,421,300 | 1,340,700 |
Property and equipment, net | 357,800 | 357,800 | 358,900 |
Depreciation and amortization | 28,200 | 80,600 | ' |
Equipment [Member] | ' | ' | ' |
Summary of property and equipment [Abstract] | ' | ' | ' |
Property and equipment, gross | 1,238,800 | 1,238,800 | 1,171,900 |
Capitalized cost of property and equipment | ' | 64,900 | ' |
Furniture [Member] | ' | ' | ' |
Summary of property and equipment [Abstract] | ' | ' | ' |
Property and equipment, gross | 392,800 | 392,800 | 380,200 |
Capitalized cost of property and equipment | ' | 14,600 | ' |
Leasehold Improvements [Member] | ' | ' | ' |
Summary of property and equipment [Abstract] | ' | ' | ' |
Property and equipment, gross | $147,500 | $147,500 | $147,500 |
Liability_Attributable_to_Warr2
Liability Attributable to Warrants (Details) (USD $) | 3 Months Ended | 9 Months Ended | 0 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | ||||||||||||||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 17, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 17, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Mar. 31, 2013 | Sep. 30, 2013 | ||||
2011 Private Placement [Member] | 2011 Private Placement [Member] | 2011 Private Placement [Member] | 2011 Private Placement [Member] | 2011 Private Placement [Member] | 2011 Private Placement [Member] | Exercise Agreement [Member] | Exercise Agreement [Member] | ipCapital [Member] | ipCapital [Member] | ipCapital [Member] | ipCapital [Member] | ipCapital [Member] | Consultant Warrants [Member] | Consultant Warrants [Member] | Offer to Exercise [Member] | Offer to Exercise [Member] | July 2013 New Warrants [Member] | August 2012 New Warrants [Member] | 2011 Private Placement [Member] | 2011 Private Placement [Member] | 2011 Private Placement [Member] | 2011 Private Placement [Member] | ipCapital [Member] | 2012 Private Placement [Member] | Genesis Select [Member] | ||||||||
Factor | Factor | Factor | Factor | Factor | Factor | Investor | Minimum [Member] | Maximum [Member] | Investor | ||||||||||||||||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Number of investors | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5 | ' | ' | ' | ' | 2 | ' | |||
Exercise price of warrants (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $1 | $0.26 | $0.20 | $0.26 | $0.26 | ' | $0.50 | |||
Share price (in dollars per share) | $0.54 | $0.30 | $0.54 | $0.30 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Cash Proceeds | ' | ' | $2,615,300 | $0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $2,340,000 | ' | ' | ' | ' | ' | ' | |||
Stock issued on exercise of warrants (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9,000,000 | ' | ' | ' | ' | ' | 312,500 | |||
Common stock subject to warrants (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 17,000,000 | ' | ' | ' | ' | ' | |||
Common stock subject to warrants excluded from exercise agreement (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,000,000 | ' | ' | ' | ' | ' | |||
Warrants exercised (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 462,500 | ' | |||
Remaining contractual term | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '38 months | ' | ' | ' | ' | ' | |||
Reconciliation of warrants liability measured at fair value using significant unobservable inputs [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Warrants liability - December 31, 2012 fair value | ' | ' | 7,390,100 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Change in fair value of warrant liability recorded in other income | ' | ' | -680,100 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Diminution of warrant liability recorded in general and administrative expense | ' | ' | 35,700 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Reclassification of warrants liability to equity from the exercise of warrants | ' | ' | -385,900 | [1] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||
Reclassification of warrants liability to equity from amendment of warrants | ' | ' | -4,391,000 | [1] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||
Warrants liability - September 30, 2013 fair value | 1,968,800 | ' | 1,968,800 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Class of Warrant or Right [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Warrants, Beginning Outstanding (in shares) | 18,057,500 | 23,475,000 | 23,475,000 | 23,475,000 | ' | 13,157,500 | 23,075,000 | 23,075,000 | 23,075,000 | 23,075,000 | 4,500,000 | 0 | 400,000 | 400,000 | 400,000 | 400,000 | 400,000 | 0 | [2] | 0 | 0 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||
Warrants issued (in shares) | 465,000 | 0 | 4,965,000 | 0 | 4,500,000 | 0 | 0 | 0 | 0 | ' | 0 | 4,500,000 | 0 | 0 | 0 | 0 | ' | 312,500 | [2] | 312,500 | 152,500 | 152,500 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||
Warrants Exercised (in shares) | 305,000 | 0 | 10,222,500 | 0 | ' | 305,000 | 0 | 10,222,500 | 0 | ' | 0 | 0 | 0 | 0 | 0 | 0 | ' | 0 | [2] | 0 | 0 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||
Warrants, Ending Outstanding (in shares) | 18,217,500 | 23,475,000 | 18,217,500 | 23,475,000 | ' | 12,852,500 | 23,075,000 | 12,852,500 | 23,075,000 | 23,075,000 | 4,500,000 | 4,500,000 | 400,000 | 400,000 | 400,000 | 400,000 | 400,000 | 312,500 | [2] | 312,500 | [2] | 152,500 | 152,500 | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Assumption used to determine the fair value of warrants [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Estimated fair value of New warrants | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 514,800 | ' | ' | ' | ' | ' | ' | ' | ' | |||
Estimated volatility (in hundredths) | ' | ' | ' | ' | ' | ' | ' | 120.00% | ' | 159.00% | ' | ' | ' | ' | 125.00% | ' | 163.00% | ' | ' | ' | ' | 185.00% | 181.00% | ' | ' | ' | ' | ' | ' | ' | |||
Annualized forfeiture rate (in hundredths) | ' | ' | ' | ' | ' | ' | ' | 0.00% | ' | 0.00% | ' | ' | ' | ' | 0.00% | ' | 0.00% | ' | ' | ' | ' | 0.00% | 5.00% | ' | ' | ' | ' | ' | ' | ' | |||
Expected option term | ' | ' | ' | ' | ' | ' | ' | '2 years 11 months 1 day | ' | '3 years 8 months 1 day | ' | ' | ' | ' | '3 years 0 months 14 days | ' | '3 years 9 months 14 days | ' | ' | ' | ' | '5 years | '4 years 11 months 16 days | ' | ' | ' | ' | ' | ' | ' | |||
Estimated exercise factor | ' | ' | ' | ' | ' | ' | ' | 4 | ' | 10 | ' | ' | ' | ' | 4 | ' | 10 | ' | ' | ' | ' | 1.5 | 0.04 | ' | ' | ' | ' | ' | ' | ' | |||
Risk-free interest rate (in hundredths) | ' | ' | ' | ' | ' | ' | ' | 0.50% | ' | 0.45% | ' | ' | ' | ' | 0.64% | ' | 0.65% | ' | ' | ' | ' | 1.07% | 1.41% | ' | ' | ' | ' | ' | ' | ' | |||
Dividends (in hundredths) | ' | ' | ' | ' | ' | ' | ' | 0.00% | ' | 0.00% | ' | ' | ' | ' | 0.00% | ' | 0.00% | ' | ' | ' | ' | 0.00% | 0.00% | ' | ' | ' | ' | ' | ' | ' | |||
Cost of issuance of warrants | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ($514,800) | ' | ' | ' | ' | ' | ' | ' | ' | |||
Vesting period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '1 year | ' | ' | ' | ' | ' | ' | ' | |||
[1] | During the nine-month period ended September 30, 2013, our warrants liability was reduced as a result of the warrants amendment, as discussed above. Additionally, our warrants liability was further reduced by $385,900 as a result of the exercise of 1,072,500 warrants during such period, whose terms were not affected by the changes made under the warrants amendment. The aggregate reduction in the liability, combining the warrant amendment and this exercise, was $4,776,900. See Note 14. | ||||||||||||||||||||||||||||||||
[2] | Effective September 18, 2013, we entered into a consulting agreement with Genesis Select to provide us with a variety of investor relations services. As part of their compensation, we issued to them a warrant to purchase 312,500 shares of our common stock at an exercise price of $0.50 per share. The warrant will vest, monthly, over the initial twelve-month service period of the contract, assuming that the agreement remains in-force, with the first vesting to occur on October 18, 2013. The warrant is substantially similar in nature to those issued in the warrant amendment, discussed above, thus; the warrant is accounted for under the equity method and is not included as a component of our warrants liability as of September 30, 2013. We used the following assumptions in a binomial pricing model to calculate the fair value of the warrant issued to Genesis: estimated volatility b 181%; annualized forfeiture rate b 5%; expected term b 4.96 years; estimated exercise factor b 4%, risk free interest rate b 1.41%; and dividends b 0. Compensation expense associated with these warrants is recognized as a component of general and administrative expense. |
Severance_Liability_Details
Severance Liability (Details) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | |||||||||||
Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Jun. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | |
Modified Options [Member] | Modified Options [Member] | Modified Options [Member] | New Option [Member] | Compensation [Member] | Medical Coverage [Member] | Employee Severance [Member] | Employee Severance [Member] | Chief Executive Officer [Member] | Chief Executive Officer [Member] | Chief Executive Officer [Member] | Chief Executive Officer [Member] | Chief Executive Officer [Member] | Chief Executive Officer [Member] | Chief Executive Officer [Member] | Chief Executive Officer [Member] | Chief Executive Officer [Member] | Chief Executive Officer [Member] | |||||
Factor | Minimum [Member] | Maximum [Member] | Factor | Compensation [Member] | Compensation [Member] | Medical Coverage [Member] | Medical Coverage [Member] | |||||||||||||||
Restructuring Cost and Reserve [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock options expiration term | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '30 months | ' | '30 months | ' | ' | '30 months | ' | ' | ' | ' |
Common stock issued as a result of exercise of employee stock options (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,000,000 | ' | ' | ' | ' | ' | ' | ' |
Share based compensation as a result of agreement modification | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0 | ' | $0 | ' | $172,700 | ' | ' | ' | ' | ' |
Options granted on release effective date (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 500,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Exercise price of options granted on release effective date (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.20 | ' | ' | ' | ' | ' | ' | ' | ' |
Number of shares vested and exercisable per quarter (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 62,500 | ' | ' | ' | ' | ' | ' | ' | ' |
Stock-based compensation expense | ' | 580,500 | 759,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | ' | 0 | ' | 64,700 | ' | ' | ' | ' | ' |
Periodic severance expenses to be paid from May 2012 through April 2013 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 27,300 | ' | ' | ' | ' | ' | ' | ' |
Periodic severance expenses to be paid from May 2013 through April 2014 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 13,600 | ' | ' | ' | ' | ' | ' | ' |
Severance costs | 75,700 | ' | ' | 721,800 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 433,700 | ' | 721,800 | ' | ' | ' | ' | ' | ' |
Accrued medical payments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 92,300 | ' | 92,300 | ' | ' | ' | ' | ' | ' | ' |
Healthcare premium for May and June | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,800 | ' | ' | ' | ' |
Future healthcare premium per month | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,300 | ' | 1,300 | ' | ' | ' | ' | ' | ' | ' |
Payment for legal fees in connection with separation agreement | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 15,000 | ' | ' | ' | ' | ' | ' | ' |
Estimated fair value of each stock-based award granted [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated Volatility (in hundredths) | ' | ' | ' | ' | ' | ' | ' | 157.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated Volatility, Minimum (in hundredths) | ' | ' | ' | ' | 70.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated Volatility, Maximum (in hundredths) | ' | ' | ' | ' | 157.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Annualized Forfeiture Rate (in hundredths) | ' | ' | ' | ' | 0.00% | ' | ' | 0.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Expected Option Term | ' | ' | ' | ' | ' | '3 months | '2 years 6 months | '2 years 6 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated exercise factor | ' | ' | ' | ' | 10 | ' | ' | 10 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Risk-Free Interest Rate, Minimum (in hundredths) | ' | ' | ' | ' | 0.08% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Risk-Free Interest Rate, Maximum (in hundredths) | ' | ' | ' | ' | 0.29% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Risk-Free Interest Rate (in hundredths) | ' | ' | ' | ' | ' | ' | ' | 0.29% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Dividends (in hundredths) | ' | ' | ' | ' | 0.00% | ' | ' | 0.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash salary continuation payments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 458,600 | ' | ' | ' | ' | ' | ' | ' |
Discount factor under terms of separation agreement (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 14.30% | ' | ' | ' | ' | ' | ' | ' |
Restructuring Reserve [Roll Forward] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Beginning Balance | ' | 262,400 | ' | ' | ' | ' | ' | ' | 250,100 | 12,300 | 47,100 | 75,700 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Separation agreement entered into in 2013 | ' | 75,700 | ' | ' | ' | ' | ' | ' | 60,000 | 15,700 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accrued interest | ' | 18,800 | ' | ' | ' | ' | ' | ' | 18,100 | 700 | ' | ' | ' | ' | ' | ' | ' | ' | 4,200 | 18,100 | 100 | 700 |
Payments | ' | -216,800 | ' | ' | ' | ' | ' | ' | -197,200 | -19,600 | ' | ' | ' | ' | ' | ' | ' | ' | -36,600 | -172,900 | -3,800 | -11,000 |
Ending Balance | $140,100 | $140,100 | ' | $262,400 | ' | ' | ' | ' | $131,000 | $9,100 | $47,100 | $75,700 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred_Rent_Details
Deferred Rent (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Deferred Revenue Arrangement [Line Items] | ' | ' |
Deferred Rent, Current Liabilities | $29,800 | $26,700 |
Deferred Rent, Long-Term Liabilities | 104,500 | 127,500 |
Deferred Rent | 134,300 | 154,200 |
Deferred rent expense [Member] | ' | ' |
Deferred Revenue Arrangement [Line Items] | ' | ' |
Deferred Rent, Current Liabilities | 5,800 | 2,700 |
Deferred Rent, Long-Term Liabilities | 38,500 | 43,500 |
Deferred Rent | 44,300 | 46,200 |
Deferred rent benefit [Member] | ' | ' |
Deferred Revenue Arrangement [Line Items] | ' | ' |
Deferred Rent, Current Liabilities | 24,000 | 24,000 |
Deferred Rent, Long-Term Liabilities | 66,000 | 84,000 |
Deferred Rent | $90,000 | $108,000 |
StockBased_Compensation_Detail
Stock-Based Compensation (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Summary of stock-based compensation expense [Abstract] | ' | ' | ' | ' |
Total stock-based compensation expense | $190,000 | $193,500 | $580,500 | $759,000 |
Weighted Average Exercise Price [Roll Forward] | ' | ' | ' | ' |
Shares fully vested (in shares) | 8,035,144 | ' | 8,035,144 | ' |
Shares expected to vest in future (in shares) | 3,906,226 | ' | 3,906,226 | ' |
Shares expected to be forfeited (in shares) | 132,189 | ' | 132,189 | ' |
Stock Options [Member] | ' | ' | ' | ' |
Number of Shares [Roll Forward] | ' | ' | ' | ' |
Outstanding - Beginning of Period (in shares) | 13,134,398 | ' | 14,174,000 | ' |
Granted (in shares) | 23,000 | ' | 23,000 | ' |
Exercised (in shares) | -1,006,094 | ' | -1,757,472 | ' |
Forfeited or expired (in shares) | -77,745 | ' | -232,151 | ' |
Cancellation of unearned performance option (in shares) | ' | ' | -133,818 | ' |
Outstanding - End of Period (in shares) | 12,073,559 | ' | 12,073,559 | ' |
Weighted Average Exercise Price [Roll Forward] | ' | ' | ' | ' |
Outstanding - Beginning of Period (in dollars per share) | $0.20 | ' | $0.20 | ' |
Granted (in dollars per share) | $0.44 | ' | $0.44 | ' |
Exercised (in dollars per share) | $0.19 | ' | $0.17 | ' |
Forfeited or expired (in dollars per share) | $0.20 | ' | $0.20 | ' |
Cancellation of unearned performance option (in dollars per share) | ' | ' | $0.19 | ' |
Outstanding - End of Period (in dollars per share) | $0.20 | ' | $0.20 | ' |
Weighted Average Remaining Contractual Terms | '6 years 3 months | ' | '6 years 3 months | ' |
Aggregate Intrinsic Value | 4,065,900 | ' | 4,065,900 | ' |
Unrecognized compensation cost | 239,100 | ' | 239,100 | ' |
Weighted-average period, compensation cost not yet recognized | ' | ' | '9 months | ' |
Stock option vesting term | ' | ' | '33 months | ' |
Restricted Stock [Member] | ' | ' | ' | ' |
Weighted Average Exercise Price [Roll Forward] | ' | ' | ' | ' |
Unrecognized compensation cost | 918,400 | ' | 918,400 | ' |
Weighted-average period, compensation cost not yet recognized | ' | ' | '26 months | ' |
Stock option vesting term | ' | ' | '3 months | ' |
Number of Shares [Abstract] | ' | ' | ' | ' |
Unreleased - Beginning of Period (in shares) | 3,796,324 | ' | 4,043,123 | ' |
Awarded (in shares) | 1,027,500 | ' | 1,607,500 | ' |
Released (in shares) | -432,521 | ' | -1,208,412 | ' |
Forfeited (in shares) | -265,157 | ' | -316,065 | ' |
Unreleased - End of Period (in shares) | 4,126,146 | ' | 4,126,146 | ' |
Weighted Average Grant Date Fair Value [Abstract] | ' | ' | ' | ' |
Unreleased - Beginning of Period (in dollars per share) | $0.22 | ' | $0.18 | ' |
Awarded (in dollars per share) | $0.42 | ' | $0.42 | ' |
Released (in dollars per share) | $0.23 | ' | $0.21 | ' |
Forfeited (in dollars per share) | $0.27 | ' | $0.36 | ' |
Unreleased - End of Period (in dollars per share) | $0.26 | ' | $0.26 | ' |
Weighted Average Remaining Recognition Period | '2 years 1 month 24 days | ' | '2 years 1 month 24 days | ' |
Unrecognized Compensation Cost Remaining | 918,400 | ' | 918,400 | ' |
Costs of Revenue [Member] | ' | ' | ' | ' |
Summary of stock-based compensation expense [Abstract] | ' | ' | ' | ' |
Total stock-based compensation expense | -500 | 6,700 | 3,300 | 17,100 |
Selling and Marketing Expense [Member] | ' | ' | ' | ' |
Summary of stock-based compensation expense [Abstract] | ' | ' | ' | ' |
Total stock-based compensation expense | 39,800 | 33,200 | 118,700 | 84,800 |
General and Administrative Expense [Member] | ' | ' | ' | ' |
Summary of stock-based compensation expense [Abstract] | ' | ' | ' | ' |
Total stock-based compensation expense | 76,300 | 71,000 | 255,800 | 404,700 |
Research and Development Expense [Member] | ' | ' | ' | ' |
Summary of stock-based compensation expense [Abstract] | ' | ' | ' | ' |
Total stock-based compensation expense | $74,400 | $82,600 | $202,700 | $252,400 |
Revenue_Details
Revenue (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Software Licenses [Abstract] | ' | ' | ' | ' |
Software licenses | $779,500 | $1,009,800 | $2,343,500 | $2,770,500 |
Software licenses, changes | -230,300 | ' | -427,000 | ' |
Software licenses, changes (in hundredths) | -22.80% | ' | -15.40% | ' |
Software Service Fees [Abstract] | ' | ' | ' | ' |
Software service fees | 737,800 | 701,900 | 2,158,000 | 2,043,800 |
Software service fees, changes | 35,900 | ' | 114,200 | ' |
Software service fees, changes (in hundredths) | 5.10% | ' | 5.60% | ' |
Other Revenue [Abstract] | ' | ' | ' | ' |
Other | 17,400 | 22,400 | 44,000 | 101,300 |
Other, changes | -5,000 | ' | -57,300 | ' |
Other changes (in hundredths) | -22.30% | ' | -56.60% | ' |
Total Revenue | 1,534,700 | 1,734,100 | 4,545,500 | 4,915,600 |
Total revenue, changes | -199,400 | ' | -370,100 | ' |
Total revenue changes (in hundredths) | -11.50% | ' | -7.50% | ' |
Windows [Member] | ' | ' | ' | ' |
Software Licenses [Abstract] | ' | ' | ' | ' |
Software licenses | 559,600 | 775,600 | 1,673,400 | 2,046,200 |
Software licenses, changes | -216,000 | ' | -372,800 | ' |
Software licenses, changes (in hundredths) | -27.80% | ' | -18.20% | ' |
Software Service Fees [Abstract] | ' | ' | ' | ' |
Software service fees | 511,300 | 469,200 | 1,471,700 | 1,338,800 |
Software service fees, changes | 42,100 | ' | 132,900 | ' |
Software service fees, changes (in hundredths) | 9.00% | ' | 9.90% | ' |
UNIX/Linux [Member] | ' | ' | ' | ' |
Software Licenses [Abstract] | ' | ' | ' | ' |
Software licenses | 219,900 | 234,200 | 670,100 | 724,300 |
Software licenses, changes | -14,300 | ' | -54,200 | ' |
Software licenses, changes (in hundredths) | -6.10% | ' | -7.50% | ' |
Software Service Fees [Abstract] | ' | ' | ' | ' |
Software service fees | 226,500 | 232,700 | 686,300 | 705,000 |
Software service fees, changes | ($6,200) | ' | ($18,700) | ' |
Software service fees, changes (in hundredths) | -2.70% | ' | -2.70% | ' |
Cost_of_Revenue_Details
Cost of Revenue (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Cost of revenue [Abstract] | ' | ' | ' | ' |
Software service costs | $64,100 | $97,500 | $191,900 | $233,000 |
Software service costs, changes | -33,400 | ' | -41,100 | ' |
Software service costs, changes (in hundredths) | -34.30% | ' | -17.60% | ' |
Software product costs | 36,400 | 63,200 | 157,700 | 198,600 |
Software product costs, changes | -26,800 | ' | -40,900 | ' |
Software product costs, changes (in hundredths) | -42.40% | ' | -20.60% | ' |
Cost of revenue | 100,500 | 160,700 | 349,600 | 431,600 |
Cost of revenue, changes | ($60,200) | ' | ($82,000) | ' |
Cost of revenue changes, in (hundredths) | -37.50% | ' | -19.00% | ' |
Capitalized_Software_Developme2
Capitalized Software Development Costs (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | |
Capitalized software [Abstract] | ' | ' | ' | ' | ' |
Software development costs | $1,116,700 | ' | $1,116,700 | ' | $573,100 |
Accumulated amortization | -457,100 | ' | -457,100 | ' | -350,000 |
Capitalized software, net | 659,600 | ' | 659,600 | ' | 223,100 |
Finite-Lived Intangible Assets [Line Items] | ' | ' | ' | ' | ' |
Amortization of capitalized software development cost | 24,000 | 41,500 | 107,100 | 124,600 | ' |
HopTo [Member] | ' | ' | ' | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' | ' | ' | ' |
Capitalized software development cost | ' | ' | $79,100 | $543,600 | ' |
Stockholders_Equity_Details
Stockholders' Equity (Details) (USD $) | 3 Months Ended | 9 Months Ended |
Sep. 30, 2013 | Sep. 30, 2013 | |
Stock Repurchase Program [Abstract] | ' | ' |
Board approved authorized amount for stock repurchase program | $1,000,000 | $1,000,000 |
Remaining amount available for future stock repurchase program plan | ' | $782,600 |
Amount of shares repurchased (in shares) | 0 | 0 |
Commitments_and_Contingencies_
Commitments and Contingencies (Details) (Campbell Facility [Member]) | 9 Months Ended |
Sep. 30, 2013 | |
sqft | |
Campbell Facility [Member] | ' |
Operating Leased Assets [Line Items] | ' |
Area of office space (in square feet) | 4,413 |
Lease expiration term | '5 years |
Lease expiration date | 30-Jun-17 |
Supplemental_Disclosure_of_Cas1
Supplemental Disclosure of Cash Flow Information (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | ||
Supplemental Disclosure of Cash Flow Information [Abstract] | ' | ' | ' | ' | |
Payment for interest expense | $0 | $0 | $0 | $0 | |
Payment of income tax | ' | ' | 1,800 | 3,100 | |
Warrants exercised in noncash transaction (in shares) | ' | ' | 1,072,500 | ' | |
Change in warrant liability | ' | ' | 5,421,300 | ' | |
Reduction in warrants liability | ' | ' | 644,400 | ' | |
Reclassification of warrants liability to equity from amendment of warrants | ' | ' | -4,391,000 | [1] | ' |
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' | ' | ' | |
Stock based compensation expense | ' | ' | 580,500 | 759,000 | |
Capitalized property and equipment | ' | ' | 3,700 | 130,900 | |
Portion of capitalized property and equipment recorded as long term liabilities - deferred rent | ' | ' | ' | 104,100 | |
Cost incurred associated with discontinued intellectual property operations | ' | ' | ' | 468,000 | |
Cash used in discontinued operations | ' | ' | ' | 432,000 | |
Capitalized Software [Member] | ' | ' | ' | ' | |
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' | ' | ' | |
Stock based compensation expense | $0 | ' | $36,700 | ' | |
[1] | During the nine-month period ended September 30, 2013, our warrants liability was reduced as a result of the warrants amendment, as discussed above. Additionally, our warrants liability was further reduced by $385,900 as a result of the exercise of 1,072,500 warrants during such period, whose terms were not affected by the changes made under the warrants amendment. The aggregate reduction in the liability, combining the warrant amendment and this exercise, was $4,776,900. See Note 14. |
Earnings_Loss_Per_Share_Detail
Earnings (Loss) Per Share (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Earnings (Loss) Per Share [Abstract] | ' | ' | ' | ' |
Antidilutive shares excluded from computation of dilutive loss per share (in shares) | 33,707,201 | 36,997,357 | 33,707,201 | 36,997,357 |
Segment_Information_Details
Segment Information (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Segment | ||||
Segment Information [Abstract] | ' | ' | ' | ' |
Number of operating segments | ' | ' | 2 | ' |
Segment revenue [Abstract] | ' | ' | ' | ' |
Consolidated Revenues Total | $1,534,700 | $1,734,100 | $4,545,500 | $4,915,600 |
Increase (Decrease) in segment revenue | -199,400 | ' | -370,100 | ' |
Increase (Decrease) in segment revenue, percentage (in hundredths) | -11.50% | ' | -7.50% | ' |
Segment income (loss) from operations [Abstract] | ' | ' | ' | ' |
Income (loss) from continuing operations | -1,608,500 | -654,800 | -3,522,500 | -3,426,200 |
Segment fixed assets (long-lived assets) [Abstract] | ' | ' | ' | ' |
Cost Basis | 5,766,400 | ' | 5,766,400 | ' |
Accumulated Depreciation / Amortization | -4,717,300 | ' | -4,717,300 | ' |
Net | 1,049,100 | ' | 1,049,100 | ' |
Revenue by Country [Abstract] | ' | ' | ' | ' |
Revenue | 1,534,700 | 1,734,100 | 4,545,500 | 4,915,600 |
United States [Member] | ' | ' | ' | ' |
Revenue by Country [Abstract] | ' | ' | ' | ' |
Revenue | 677,600 | 668,800 | 1,886,000 | 1,980,100 |
Germany [Member] | ' | ' | ' | ' |
Revenue by Country [Abstract] | ' | ' | ' | ' |
Revenue | 84,600 | 181,000 | 354,200 | 533,300 |
Brazil [Member] | ' | ' | ' | ' |
Revenue by Country [Abstract] | ' | ' | ' | ' |
Revenue | 161,000 | 176,400 | 415,100 | 444,800 |
Other Countries [Member] | ' | ' | ' | ' |
Revenue by Country [Abstract] | ' | ' | ' | ' |
Revenue | 611,500 | 707,900 | 1,890,200 | 1,957,400 |
GO-Global [Member] | ' | ' | ' | ' |
Segment revenue [Abstract] | ' | ' | ' | ' |
Consolidated Revenues Total | 1,534,700 | 1,734,100 | 4,545,500 | 4,915,600 |
Increase (Decrease) in segment revenue | -199,400 | ' | -370,100 | ' |
Increase (Decrease) in segment revenue, percentage (in hundredths) | -11.50% | ' | -7.50% | ' |
Segment income (loss) from operations [Abstract] | ' | ' | ' | ' |
Income (loss) from continuing operations | 800 | 413,000 | -204,500 | -591,000 |
Segment fixed assets (long-lived assets) [Abstract] | ' | ' | ' | ' |
Cost Basis | 1,964,900 | ' | 1,964,900 | ' |
Accumulated Depreciation / Amortization | -1,799,100 | ' | -1,799,100 | ' |
Net | 165,800 | ' | 165,800 | ' |
HopTo [Member] | ' | ' | ' | ' |
Segment revenue [Abstract] | ' | ' | ' | ' |
Consolidated Revenues Total | 0 | 0 | 0 | 0 |
Increase (Decrease) in segment revenue | 0 | ' | 0 | ' |
Segment income (loss) from operations [Abstract] | ' | ' | ' | ' |
Income (loss) from continuing operations | -1,609,300 | -1,067,800 | -3,318,000 | -2,835,200 |
Segment fixed assets (long-lived assets) [Abstract] | ' | ' | ' | ' |
Cost Basis | 930,800 | ' | 930,800 | ' |
Accumulated Depreciation / Amortization | -79,200 | ' | -79,200 | ' |
Net | 851,600 | ' | 851,600 | ' |
Segment, Continuing Operations [Member] | ' | ' | ' | ' |
Segment income (loss) from operations [Abstract] | ' | ' | ' | ' |
Income (loss) from continuing operations | -1,608,500 | -654,800 | -3,522,500 | -3,426,200 |
Segment fixed assets (long-lived assets) [Abstract] | ' | ' | ' | ' |
Cost Basis | 2,895,700 | ' | 2,895,700 | ' |
Accumulated Depreciation / Amortization | -1,878,300 | ' | -1,878,300 | ' |
Net | 1,017,400 | ' | 1,017,400 | ' |
Segment, Discontinued Operations [Member] | ' | ' | ' | ' |
Segment fixed assets (long-lived assets) [Abstract] | ' | ' | ' | ' |
Cost Basis | 2,839,000 | ' | 2,839,000 | ' |
Accumulated Depreciation / Amortization | -2,839,000 | ' | -2,839,000 | ' |
Net | 0 | ' | 0 | ' |
Unallocated Amount to Segment [Member] | ' | ' | ' | ' |
Segment fixed assets (long-lived assets) [Abstract] | ' | ' | ' | ' |
Cost Basis | 31,700 | ' | 31,700 | ' |
Accumulated Depreciation / Amortization | 0 | ' | 0 | ' |
Net | $31,700 | ' | $31,700 | ' |
Related_Party_Transactions_Det
Related Party Transactions (Details) (USD $) | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 6 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 0 Months Ended | |||||||||||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Oct. 11, 2011 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Feb. 04, 2013 | |
Selling, General and Administrative Expenses [Member] | Selling, General and Administrative Expenses [Member] | Tamalpais Partners LLC [Member] | Tamalpais Partners LLC [Member] | Tamalpais Partners LLC [Member] | Tamalpais Partners LLC [Member] | ipCapital Group, Inc.[Member] | ipCapital Group, Inc.[Member] | ipCapital Group, Inc.[Member] | ipCapital Group, Inc.[Member] | ipCapital Group, Inc.[Member] | ipCapital Group, Inc.[Member] | ipCapital Group, Inc.[Member] | ipCapital Group, Inc.[Member] | ipCapital Group, Inc.[Member] | ipCapital Group, Inc.[Member] | ipCapital Licensing Company LLC [Member] | |||||
Installment | Director | Selling, General and Administrative Expenses [Member] | Selling, General and Administrative Expenses [Member] | Selling, General and Administrative Expenses [Member] | Selling, General and Administrative Expenses [Member] | ||||||||||||||||
Contract | |||||||||||||||||||||
ipCapital Group, Inc. [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of directors provide assistance in execution of entity strategic decision | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | ' | ' | ' | ' | ' |
Payment for services performed under agreement | ' | ' | ' | ' | ' | ' | $54,000 | $18,000 | $92,000 | $48,000 | $0 | $30,000 | ' | $31,200 | $133,000 | ' | $49,500 | $38,200 | $35,700 | $52,700 | ' |
Payment for analysis of intellectual property and potential methods to employ | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 50,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Unpaid balance for services performed | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 37,300 | ' | ' | 37,300 | ' | ' | ' | ' | ' | ' |
Term of warrants | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | ' | ' | ' |
Common stock convertible from warrants (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 400,000 | ' | ' | 400,000 | ' | ' | ' | ' | ' | ' | ' |
Investment warrants, exercise price (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.26 | ' | ' | ' | ' | ' | ' | ' |
Warrants with time-based vesting condition (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 200,000 | ' | ' | ' | ' | ' | ' | ' |
Number of vesting installments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3 | ' | ' | ' | ' | ' | ' | ' |
Number of separate addendums to initial agreement | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3 | ' | ' | ' | ' | ' | ' | ' |
Remaining warrants to vest upon completion of services (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 200,000 | ' | ' | ' | ' | ' | ' | ' |
Percentage of royalty fees and other consideration paid as fees (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10.00% |
Period of agreement | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '18 months |
Number of days of written notice of termination | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '60 days |
Change in fair value of warrant liability | $639,100 | $3,025,700 | ($680,100) | $2,417,800 | ($49,500) | ($38,200) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ($35,700) | ($52,700) | ' |
Discontinued_Operations_Detail
Discontinued Operations (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Discontinued Operations [Abstract] | ' | ' | ' | ' |
Cost related to intellectual property litigation | ' | $347,100 | ' | $468,400 |
Revenue derived from intellectual property litigation | $0 | $0 | $0 | $0 |
Subsequent_Events_Details
Subsequent Events (Details) (USD $) | 9 Months Ended | 0 Months Ended |
Sep. 30, 2013 | Oct. 07, 2013 | |
Campbell Facility [Member] | Subsequent Event [Member] | |
sqft | sqft | |
Subsequent Event [Line Items] | ' | ' |
Area of office space (in square feet) | 4,413 | 10,659 |
Lease expiration date | 30-Jun-17 | 31-Oct-18 |
Prepayment of First Month's Rent | ' | $18,100 |
Additional Deposits Made to Landlord | ' | 109,000 |
Amount of leasehold improvements provided by the landlord | ' | 106,600 |
Number of First Months of Free Rent | ' | '4 months |
Write off of Cambell Facility leasehold improvements | 103,700 | ' |
Amortization period of leasehold improvements | '3 months | ' |
Minimum lease payments [Abstract] | ' | ' |
Remainder of 2013 | 0 | ' |
2014 | 346,000 | ' |
2015 | 449,500 | ' |
2016 | 463,000 | ' |
2017 | 476,900 | ' |
2018 | 407,300 | ' |
Total | $2,142,700 | ' |