Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Mar. 21, 2017 | Jun. 30, 2016 | |
Document And Entity Information | |||
Entity Registrant Name | hopTo Inc. | ||
Entity Central Index Key | 1,021,435 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2016 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Public Float | $ 12,328,303 | ||
Entity Common Stock, Shares Outstanding | 9,804,400 | ||
Trading Symbol | HPTO | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2,016 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Current Assets: | ||
Cash | $ 546,200 | $ 1,777,300 |
Accounts receivable, net of allowance for doubtful accounts of $7,700 and $17,300, respectively | 355,300 | 434,900 |
Prepaid expenses and other current assets | 38,700 | 139,200 |
Total Current Assets | 940,200 | 2,351,400 |
Capitalized software development costs, net | 20,800 | |
Property and equipment, net | 143,300 | 252,500 |
Other assets | 109,000 | 109,000 |
Total Assets | 1,192,500 | 2,733,700 |
Current Liabilities: | ||
Accounts payable | 575,500 | 385,200 |
Accrued expenses | 87,400 | 69,600 |
Accrued wages | 312,900 | 557,300 |
Severance liability | 5,900 | |
Deferred rent | 24,100 | 21,000 |
Capital lease | 6,800 | 8,400 |
Deferred revenue | 1,759,000 | 2,467,000 |
Other current liabilities | 571,100 | |
Total Current Liabilities | 3,336,800 | 3,514,400 |
Long Term Liabilities: | ||
Warrants liability | 31,600 | |
Deferred revenue | 1,694,600 | 1,465,800 |
Deposit liability | 81,400 | 81,400 |
Capital lease | 6,800 | |
Deferred rent | 2,600 | 26,700 |
Total Liabilities | 5,089,400 | 5,126,700 |
Commitments and contingencies (Note 13) | ||
Shareholders' Equity (Deficit): | ||
Preferred stock, $0.01 par value, 5,000,000 shares authorized, no shares issued and outstanding | ||
Common stock, $0.0001 par value, 195,000,000 shares authorized, 9,804,462 and 9,731,233 shares issued and outstanding, respectively | 14,700 | 14,600 |
Additional paid-in capital | 78,512,200 | 78,189,300 |
Accumulated deficit | (82,449,800) | (80,596,900) |
Total Shareholders' Deficit | (3,922,900) | (2,393,000) |
Total Liabilities and Shareholders' Deficit | $ 1,192,500 | $ 2,733,700 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 7,700 | $ 17,300 |
Preferred stock par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | ||
Preferred stock, shares outstanding | ||
Common stock par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 195,000,000 | 195,000,000 |
Common stock, shares issued | 9,804,462 | 9,731,233 |
Common stock, shares outstanding | 9,804,462 | 9,731,233 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Revenue | ||
Software licenses | $ 1,446,600 | $ 2,330,000 |
Software service fees | 2,413,700 | 2,605,900 |
Other | 141,000 | 45,100 |
Total Revenue | 4,001,300 | 4,981,000 |
Cost of revenue | ||
Software service costs | 109,100 | 169,500 |
Software product costs | 38,000 | 257,500 |
Write-down of capitalized software development costs | 15,500 | 182,400 |
Total Cost of Revenue | 162,600 | 609,400 |
Gross Profit | 3,838,700 | 4,371,600 |
Operating Expenses | ||
Selling and marketing | 774,400 | 1,588,200 |
General and administrative | 2,759,200 | 3,136,600 |
Research and development | 2,187,900 | 4,224,000 |
Total Operating Expenses | 5,721,500 | 8,948,800 |
Loss from Operations | (1,882,800) | (4,577,200) |
Other Income (Expense) | ||
Change in fair value of warrants liability | 29,300 | 190,300 |
Interest and other income | 3,700 | 1,400 |
Interest and other expense | (300) | (1,900) |
Total other income (expense) | 32,700 | 189,800 |
Loss from operations before provision for income tax | (1,850,100) | (4,387,400) |
Provision for income tax | 2,800 | 3,700 |
Net loss | $ (1,852,900) | $ (4,391,100) |
Loss per share – basic and diluted | $ (0.19) | $ (0.52) |
Weighted Average Common Shares Outstanding – Basic and Diluted | 9,770,076 | 8,437,390 |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Equity (Deficit) - USD ($) | Preferred Stock [Member] | Common Stock [Member] | Additional Paid-In Capital [Member] | Accumulated Deficit [Member] | Total |
Beginning balance at Dec. 31, 2014 | $ 11,200 | $ 74,600,700 | $ (76,205,800) | ||
Beginning balance, shares at Dec. 31, 2014 | 7,502,814 | ||||
Private placement of stock and warrants | |||||
Private placement of stock and warrants, shares | 2,105,919 | ||||
Employee stock option issuances | |||||
Employee stock option issuances, shares | 6,000 | ||||
Vesting of restricted stock awards | $ 200 | ||||
Vesting of restricted stock awards, shares | 116,500 | ||||
Par value of shares issued in private placement | $ 3,200 | ||||
Stock-based compensation expense | 757,500 | ||||
Company payment of employee taxes for stock-based compensation | (11,900) | ||||
Proceeds from exercise of employee stock options | 4,900 | ||||
Proceeds from private placement of common stock and warrants, net of par value of shares issued | 2,547,300 | ||||
Cost of private placement of common stock and warrants | (116,400) | ||||
Reclassification of warrants liability to equity (2014 PIPE) | 407,300 | ||||
Other Rounding | (100) | ||||
Net loss | (4,391,100) | (4,391,100) | |||
Ending balance at Dec. 31, 2015 | $ 14,600 | 78,189,300 | (80,596,900) | (2,393,000) | |
Ending balance, shares at Dec. 31, 2015 | 9,731,233 | ||||
Private placement of stock and warrants | |||||
Private placement of stock and warrants, shares | |||||
Employee stock option issuances | |||||
Employee stock option issuances, shares | 1,800 | ||||
Vesting of restricted stock awards | $ 100 | ||||
Vesting of restricted stock awards, shares | 71,429 | ||||
Par value of shares issued in private placement | |||||
Stock-based compensation expense | 324,400 | ||||
Company payment of employee taxes for stock-based compensation | (2,700) | ||||
Proceeds from exercise of employee stock options | 1,500 | ||||
Proceeds from private placement of common stock and warrants, net of par value of shares issued | |||||
Cost of private placement of common stock and warrants | |||||
Reclassification of warrants liability to equity (2014 PIPE) | |||||
Other Rounding | (300) | ||||
Net loss | (1,852,900) | (1,852,900) | |||
Ending balance at Dec. 31, 2016 | $ 14,700 | $ 78,491,300 | $ (82,449,800) | $ (3,922,900) | |
Ending balance, shares at Dec. 31, 2016 | 9,804,462 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Cash Flows Provided By (Used In) Operating Activities: | ||
Net loss | $ (1,852,900) | $ (4,391,100) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 94,600 | 334,800 |
Write-down of capitalized software development costs | 15,500 | 182,400 |
Stock based compensation expense | 324,400 | 757,500 |
Company payments of employee taxes for stock-based compensation | (2,700) | (11,900) |
Revenue deferred to future periods | 2,944,800 | 3,114,200 |
Recognition of deferred revenue | (3,424,000) | (3,693,300) |
Change in allowance for doubtful accounts | (5,900) | (15,300) |
Change in fair value of derivative instruments - warrants | (29,300) | (190,300) |
Accretion of warrants liability for consulting services | (2,300) | (18,100) |
Gain on disposal of fixed assets | (3,300) | |
Interest accrued for capital lease | 800 | 1,700 |
Changes in severance liability | (5,900) | 5,900 |
Changes in deferred rent | (21,000) | (155,000) |
Changes in operating assets and liabilities: | ||
Accounts receivable | 89,200 | 1,791,700 |
Prepaid expenses and other current assets | 100,500 | (300) |
Other long term assets | (10,000) | |
Accounts payable | 190,300 | 150,600 |
Accrued expenses | 17,700 | (46,600) |
Accrued wages | (244,400) | (108,400) |
Deposit liability | 81,400 | |
Other current liabilities | 571,100 | |
Net Cash Used In Operating Activities | (1,246,500) | (2,220,100) |
Cash Flows Used In Investing Activities: | ||
Proceeds from sale of fixed assets | 23,300 | |
Capitalized software development costs | (12,000) | |
Capital expenditures | (7,300) | |
Net Cash Provided by (Used In) Investing Activities | 23,300 | (19,300) |
Cash Flows Provided By (Used In) Financing Activities: | ||
Proceeds from exercise of employee stock options | 1,500 | 4,900 |
Proceeds from private placement of common stock and warrants | 2,550,500 | |
Cost associated with private placement of common stock and warrants | (86,400) | |
Payments for capital lease | (9,400) | (9,400) |
Net Cash (Used In) Provided By Financing Activities | (7,900) | 2,459,600 |
Net Decrease in Cash | (1,231,100) | (220,200) |
Cash, beginning of year | 1,777,300 | 1,557,100 |
Cash, end of year | $ 546,200 | $ 1,777,300 |
Basis of Presentation
Basis of Presentation | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | 1. Basis of Presentation The Company hopTo Inc., and its subsidiaries are developers of application publishing software which includes application virtualization software and cloud computing software for multiple computer operating systems including Windows, UNIX and several Linux-based variants. The Company sells a family of products under the brand name GO-Global, which is a software application publishing business and is the Company’s sole revenue source at this time. GO-Global is an application access solution for use and/or resale by independent software vendors (“ISVs”), corporate enterprises, governmental and educational institutions, and others, who wish to take advantage of cross-platform remote access and Web-enabled access to their existing software applications, as well as those who are deploying secure, private cloud environments. Since 2012 we have also been developing several products in the field of software productivity for mobile devices such as tablets and smartphones, which have been marketed under the hopTo brand. The hopTo products were originally marketed to consumers and were later also marketed to small and medium sized businesses and enterprise level customers under the name hopTo Work. hopTo Work allows customers to instantly transform their legacy applications to become touch friendly on modern mobile devices. During 2015 and 2016, we also worked to integrate hopTo Work with certain software products offered by Citrix Systems. As of Q4 2016, we have effectively ceased all of our sales, marketing and R&D efforts for the hopTo products, and at this time we do not expect any meaningful revenues from these products in the foreseeable future. We continue to own all hopTo-related IP including source-code, related patents, and the relevant trademarks. We continue to believe that we may be able to extract value from these assets and are currently working to do so at this time. Over the years, the Company has also made significant investments in intellectual property (“IP”). It has filed many patents designed to protect the new technologies embedded in hopTo. As of March 31, 2017 52 patents have been granted by the USPTO and we have also received notice from the USPTO that one additional patent application has been allowed and will ultimately issue as a US patent in the next 30-45 days. Due to financial constraints on our operations, we have suspended patent prosecution activity other than to pay issuance fees for patents already approved by USPTO. On January 27, 2016, we filed an amendment of our Amended and Restated Certificate of Incorporation, as amended, to effect a 1-for-15 reverse stock split of our common stock (the “Reverse Stock Split”). The Reverse Stock Split became effective in the stock market upon commencement of trading on January 28, 2016. As a result of the Reverse Stock Split, every fifteen shares of our pre-Reverse Stock Split common stock were combined and reclassified into one share of our common stock. No fractional shares were issued in connection with the Reverse Stock Split, and cash paid to stockholders for potential fractional shares was insignificant. The number of shares of common stock subject to outstanding options, restricted stock units, warrants and convertible securities were also reduced by a factor of fifteen as of January 27, 2016. All historical share and per share amounts reflected throughout this report have been adjusted to reflect the Reverse Stock Split. The authorized number of shares and the par value per share of our common stock were not affected by the Reverse Stock Split. |
Going Concern and Management's
Going Concern and Management's Liquidity Plans | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Going Concern and Management's Liquidity Plans | 2. Going Concern and Management’s Liquidity Plans The accompanying consolidated financial statements have been prepared in conformity with GAAP, assuming we will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. Accordingly, the consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the possible inability of the Company to continue as a going concern. We have incurred significant net losses since our inception. For the year ended December 31, 2016, the Company incurred a net loss of $1,852,900. At December 31, 2016, the Company had an accumulated deficit of $82,449,800 and a working capital deficit of $2,396,600. Due to our inability to date to generate meaningful revenue from our hopTo Work business and our continued estimation that revenue from this product is unlikely in any reasonable time frame, our cash resources may not be sufficient to fund our business for the next 12 months. The Company’s ability to continue as a going concern is dependent on our ability to continue to generate revenue from our legacy GO-Global business and to raise additional capital through the issuance of new equity, debt financing, or from the sale of certain assets to meet short and long-term operating requirements. If the Company raises additional funds through the issuance of equity or convertible debt securities, the percentage ownership of our current shareholders could be reduced, and such securities might have rights, preferences or privileges senior to the Company’s common stock. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, the Company may not be able to take advantage of prospective business endeavors or opportunities, which could significantly and materially restrict our operations. We are continuing to pursue external financing alternatives to improve our working capital position. If the Company is unable to obtain the necessary capital, the Company may have to cease operations. These factors raise substantial doubt about our ability to continue as a going concern. In order to maintain operations, we previously implemented significant expense reductions, including a limited number of employee layoffs, and continue to implement further costs and employment reductions. During the three month period ended September 30, 2016, our CEO and CFO voluntarily agreed with our board of directors to defer 50% of their salary beginning September 1, 2016 until such time as the Company can reasonably pay such compensation upon approval by the board of directors. Although maintaining our SEC filing status is a significant expense, we are considering all options to preserve value for shareholders, including potentially suspending or terminating our filing status, however we have not made any decision to do so. We have worked extensively to explore additional sources of capital including the issuance of new shares, securing debt financing, and the sale of assets including certain software products and patents. Although this process is ongoing and we are in active discussions with multiple parties, there is no guarantee that they will result in transactions that are sufficient to provide the Company with the required liquidity to remove the substantial doubt as to our ability to continue as a going concern. We are also in discussions with some parties about the possibility of other strategic transactions although there is no guarantee that these discussions will result in an actual transaction. The accompanying consolidated financial statements do not include any adjustments that may result from the outcome of the uncertainties set forth above. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | 3. Significant Accounting Policies Basis of Presentation and Use of Estimates Cash Equivalents Property and Equipment Shipping and Handling Software Development Costs “Costs of Software to be Sold, Leased or Marketed,” Revenue Recognition Software license revenues are recognized when: ● Persuasive evidence of an arrangement exists (i.e., when the Company signs a non-cancelable 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 generally 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 programs), and ● The price to the customer is fixed or determinable, as typically evidenced in a signed non-cancelable 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, or customer training. The Company limits its 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 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 evidence 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 the Company 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 one or more licenses from a stocking reseller’s inventory (a “draw down order”), the Company will ship the licenses(s) in accordance with the draw down order’s instructions. The Company defers 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 purchasers of the Company’s software products. Revenue is recognized from maintenance contracts ratably over the related contract period, which generally ranges from one to five years. All of the Company’s software licenses are denominated in U.S. dollars. Deferred Rent Incentives 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. The unamortized portion of these incentives are recorded as a part of deferred rent in current or long-term liabilities, as appropriate. Post-employment Benefits (Severance Liability) Allowance for Doubtful Accounts Beginning Balance Charge Offs Recoveries Provision Ending Balance 2016 $ 17,300 $ (3,700 ) $ — $ (5,900 ) $ 7,700 2015 $ 32,600 $ — $ — $ (15,300 ) $ 17,300 Income Taxes “Income Taxes,” The Company and one or more of its subsidiaries are subject to United States federal income taxes, as well as income taxes of multiple state and foreign jurisdictions. The Company and its subsidiaries are no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years prior to 2011. There are no tax examinations currently underway for any of the Company’s or its subsidiaries’ tax returns for years subsequent to 2010. The Company’s policy for deducting interest and penalties is to treat interest as interest expense and penalties as taxes. The Company had not accrued any amount for the payment of interest or penalties related to any uncertain tax positions at either December 31, 2016 or 2015, as its review of such positions indicated that such potential positions were minimal. Under FASB ASC 740-10-05, “Income Taxes,” Fair Value of Financial Instruments The fair value of the Company’s warrants are determined in accordance with FASB ASC 820, “Fair Value Measurement,” ● 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 December 31, 2016 and 2015, all of the Company’s $0 and $31,600 Warrants Liability reported at fair value, respectively, were categorized as Level 3 inputs (see Note 9). Derivative Financial Instruments Long-Lived Assets Loss Contingencies Stock-Based Compensation Compensation – Stock Compensation. Valuation and Expense Information Under FASB ASC 718-10 The Company recorded stock-based compensation expense of $324,400 and $757,500 in the years ended December 31, 2016 and 2015, respectively. No expense was capitalized related to software development. As required by FASB ASC 718-10, the Company estimates forfeitures of employee stock-based awards and recognizes compensation cost only for those awards expected to vest. Forfeiture rates are estimated based on an analysis of historical experience and are adjusted to actual forfeiture experience as needed. During 2016, we awarded 35,000 shares of restricted common stock to seven members of our board of advisors. The valuation of the restricted common stock awards was based on the closing fair market value of our common stock on the grant date. For these awards, such fair market value was $1.65 per share. These shares were canceled in the three month period ended September 2016. For all options granted during 2016 and 2015, the Company set the exercise price equal to the closing fair market value of the Company’s common stock as of the date of grant. We did not issue any options during 2016. The following table illustrates the non-cash stock-based compensation expense recorded during the years ended December 31, 2016 and 2015 by income statement classification: 2016 2015 Cost of revenue $ 5,600 $ 9,000 Selling and marketing expense 69,200 148,700 General and administrative expense 156,000 499,500 Research and development expense 93,600 100,300 $ 324,400 $ 757,500 The Company estimated the fair value of each option grant made during the years ended December 31, 2016 and 2015 on the date of grant using a binomial model, with the assumptions set forth in the following table: 2016 2015 Estimated volatility - 103 % Annualized forfeiture rate - 0 % Expected option term (years) - 10.00 Estimated exercise factor - 15.0 Approximate risk-free interest rate - 0.74 % Expected dividend yield — — The estimated annualized forfeiture rate was based on an analysis of historical data and considered the impact of events such as work force reductions we carried out in previous years. The expected term of our stock-based awards was based on historical award holder exercise patterns and considered the market performance of our common stock and other items. 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. The Company used the average historical volatility of its daily closing price for a period of time equal in length to the expected option term for the option being issued. The period of time over which historical volatility was measured ended on the last day of the quarterly reporting period during which the stock-based award was made. The Company does not anticipate paying dividends on its common stock for the foreseeable future. Earnings Per Share of Common Stock “Earnings Per Share,” Comprehensive Loss “Reporting Comprehensive Income,” Recent Accounting Pronouncements In December 2016, the FASB issued ASU No. 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers Revenue from Contracts with Customers (Topic 606)” In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments In May 2016, the FASB issued ASU 2016-12— Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients In April 2016, the FASB issued ASU 2016-10— Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing to clarify certain aspects of ASU 2014-09 In March 2016, the FASB issued ASU 2016-09— Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting In March 2016, the FASB issued ASU 2016-08— Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net) In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) In November 2015, the FASB issued ASU 2015-17, Balance Sheet Classification of Deferred Taxes In August 2015, FASB issued ASU No. 2015-14 “ Revenue from Contracts with Customers (Topic 606)” – Deferral of the Effective Date In April 2015, FASB issued ASU No. 2015-05 “ Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement” In August 2014, FASB issued Accounting Standards Update (“ASU”) No. 2014-15 “ Preparation of Financial Statements - Going Concern (Subtopic 205-40).” In May 2014, FASB issued ASU No. 2014-09 “ Revenue from Contracts with Customers (Topic 606)” 1. Removes inconsistencies and weaknesses in revenue requirements. 2. Provides a more robust framework for addressing revenue issues. 3. Improves comparability of revenue recognition practices across entities, industries, jurisdictions, and capital markets. 4. Provides more useful information to users of financial statements through improved disclosure requirements. 5. Simplifies the preparation of financial statements by reducing the number of requirements to which an entity must refer. The core principle of ASU 2014-09 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2014-09 is effective for annual reporting periods beginning after December 15, 2016, including interim periods within such annual period. Early adoption is not permitted. We are currently evaluating this ASU in order to determine whether or not its adoption will have a material impact on our results of operations, cash flows or financial position. |
Capitalized Software Developmen
Capitalized Software Development Costs | 12 Months Ended |
Dec. 31, 2016 | |
Research and Development [Abstract] | |
Capitalized Software Development Costs | 4. Capitalized Software Development Costs Capitalized software development costs as of December 31, 2016 and 2015 consisted of the following: 2016 2015 Software development costs $ 490,400 $ 518,800 Accumulated amortization (490,400 ) (498,000 ) $ - $ 20,800 During 2016 and 2015, we capitalized $0 and $12,000, respectively, of software development costs associated with hopTo. Such costs were the cost of licenses to third party software used by hopTo. Amortization of capitalized software development costs is a component of costs of revenue. Capitalized software development costs amortization aggregated $5,400 and $217,500 during the years ended December 31, 2016 and 2015, respectively. During 2016 and 2015, we determined that an impairment of $15,500 and $182,400, respectively, existed with certain capitalized software development costs associated with our hopTo consumer product and recognized that cost as part of cost of revenue. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | 5. Property and Equipment Property and equipment as of December 31, 2016 and 2015 consisted of the following: 2016 2015 Equipment $ 258,700 $ 313,700 Furniture & fixture 190,600 233,900 Leasehold improvements 167,600 167,600 616,900 715,200 Less: accumulated depreciation and amortization 473,600 462,700 $ 143,300 $ 252,500 Aggregate property and equipment depreciation expense for the years ended December 31, 2016 and 2015 was $89,200 and $117,300 respectively. During 2016 and 2015, we did not capitalize any property and equipment. During 2016, we retired equipment with costs of $55,000 and furniture and fixtures with costs of $43,300. During 2015, we did not retire any assets. The $98,300 total in assets retired in 2016 had total remaining book value of $20,000. |
Accrued Expenses
Accrued Expenses | 12 Months Ended |
Dec. 31, 2016 | |
Payables and Accruals [Abstract] | |
Accrued Expenses | 6. Accrued Expenses Accrued expenses as of December 31, 2016 and 2015 consisted of the following: 2016 2015 Consulting services $ 35,000 $ 40,200 Franchise tax 1,500 3,200 Software and subscription fees 2,300 4,900 Board of director fees 23,000 - Royalty fees 10,800 - Other 14,800 21,300 $ 87,400 $ 69,600 |
Severance Liability
Severance Liability | 12 Months Ended |
Dec. 31, 2016 | |
Related Party Transactions [Abstract] | |
Severance Liability | 7. Severance Liability In August of 2015 we agreed to provide a terminated employee a lump sum payment $15,000 and six months of medical coverage payments which ended on March 2, 2016. As of December 31, 2016 and 2015, $0 and $5,900 remained outstanding associated with this severance liability, respectively. |
Deferred Rent
Deferred Rent | 12 Months Ended |
Dec. 31, 2016 | |
Revenue | |
Deferred Rent | 8. Deferred Rent We amended our office lease during 2013. On February 1, 2014, we moved our corporate offices to a different building within the same office complex owned and operated by our landlord on South Bascom Avenue in Campbell, California, where our corporate offices had been located prior to February 1, 2014. Since the new space is controlled by the same landlord, we considered the lease amendment to be a modification to our preexisting lease; accordingly, we are amortizing the remaining balance in deferred rent immediately prior to February 1, 2014 over the remaining term of the modified amended lease. Additionally, our landlord provided us with $106,600 of leasehold improvements on the new space that we are amortizing over the remaining term of the amended lease. All of the prior leasehold improvements that had not been previously amortized were accelerated and recognized in their entirety from the time of the amendment through January 2014, prior to the move. On August 11, 2015, we entered into a sublease agreement to sublease the entirety of the South Bascom office space to a third party. The term of the sublease extends through the end of our office lease term for that space and the monthly rent payments due to hopTo fully offset the monthly rent payments due to the landlord under hopTo’s lease for that space. On August 24, 2015, we entered into a new office lease for our corporate headquarters at 51 E. Campbell Avenue, Campbell, California which became effective on October 1, 2015, is better suited to our California operations and results in significant monthly savings. We were required to pre-pay a portion of the lease commitment in the form of a deposit which was recorded as deferred rent during 2015. As of December 31, 2016 deferred rent was: Component Current Liabilities Long-Term Liabilities Total Deferred rent expense $ (15,600 ) $ (30,500 ) $ (46,100 ) Deferred rent benefit 39,700 33,100 72,800 $ 24,100 $ 2,600 $ 26,700 As of December 31, 2015 deferred rent was: Component Current Liabilities Long-Term Liabilities Total Deferred rent expense $ (18,700 ) $ (46,100 ) $ (64,800 ) Deferred rent benefit 39,700 72,800 112,500 $ 21,000 $ 26,700 $ 47,700 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. |
Liability Attributable to Warra
Liability Attributable to Warrants | 12 Months Ended |
Dec. 31, 2016 | |
Other Liabilities Disclosure [Abstract] | |
Liability Attributable to Warrants | 9. Liability Attributable to Warrants On January 7, 2014, we entered into a securities purchase agreement (the “SPA”) with a limited number of institutional investors, pursuant to which we issued and sold for cash an aggregate 753,333 shares of our common stock at a purchase price of $4.50 per share (the “2014 Transaction”). We also issued warrants to the investors for no additional consideration to purchase an aggregate 376,667 shares of our common stock at an exercise price of $6.00 per share from January 7, 2014 through January 7, 2019. Under certain conditions of the SPA that were to expire no later than January 7, 2015, we could have been required to issue a variable number of additional warrants to the investors at a below-market value exercise price. Accordingly, we have concluded that the warrants issued to the investors are not indexed to our common stock; therefore, the fair value of these warrants has been recorded as a liability of $1,356,000 on January 7, 2014 our Balance Sheet. Since these conditions did not occur as of January 7, 2015, we have reclassified the warrant from liability to equity. Using a binomial pricing model, we calculated the fair value of the warrants issued to the investors on January 7, 2015 to be $407,300. We used the following assumptions in the binomial pricing model to derive the fair value: estimated volatility 113%; annualized forfeiture rate 0%; expected term 4.1 years; estimated exercise factor 3.5; risk free interest rate 1.20; and dividends 0. 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 Group, Inc. (“ipCapital”), which are recognized as a component of general and administrative expense in the 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 a 2011 transaction, including those issued to the placement agent, was either $3.00 or $3.90 per share, and was $3.90 per share for the warrants issued to ipCapital. The warrants issued to the placement agent included anti-dilution provisions for repricing of the warrants in the event that future issuances of stock by hopTo met certain conditions. The 2015 Transaction (Note 10) met those conditions and resulted in the placement agent warrants being repriced from $3.00 and $3.90 to $2.55 and $3.30, respectively. On September 1, 2016, the liability warrants for the 2011 transaction expired. We used a binomial pricing model to determine the fair value of our warrants liability as of December 31, 2016 and 2015, the balance sheet dates, respectively, using the following assumptions: For the Year Ended December 31, 2016 Warrants Estimated Volatility Annualized Forfeiture Rate Expected Option Term (Years) Estimated Exercise Factor Risk-Free Interest Rate Dividends 2011 Private Placement 108% - 162% — 0.6 - 0 -3.5 – 1.1 -0.20% - 0.26-% — ipCapital 125% - 378% — 0.71 - 0- -4.0 – 1.1 -0.20% - 0.26-% — For the Year Ended December 31, 2015 Warrants Estimated Volatility Annualized Forfeiture Rate Expected Option Term (Years) Estimated Exercise Factor Risk-Free Interest Rate Dividends 2011 Private Placement 104% - 132 — 1.61 – 0.68 3.5 0.26% - 0.47% — ipCapital 105% - 127% — 1.79 – 0.79 4 0.26% - 0.54% — The following table is a reconciliation of the warrants liability measured at fair value using significant unobservable inputs (Level 3) for the year ended December 31, 2016: Warrants liability – December 31, 2015 fair value $ 31,600 Change in fair value of warrant liability recorded in other income (29,300 ) Change in fair value of warrant liability recorded in general and administrative expense (2,300 ) Warrants liability – December 31, 2016 fair value $ - The following tables reconcile the number of warrants outstanding for the periods indicated: For the Year Ended December 31, 2016 Beginning Outstanding Issued Exercised Cancelled / Forfeited Ending Outstanding 2011 Transaction 686,833 — (686,833) — 2014 Transaction 376,667 — — — 376,667 ipCapital 26,667 — — (26,667) — Exercise Agreement 300,000 — — — 300,000 Consultant Warrant 11,285 — — — 11,285 Offer to Exercise 10,167 — — — 10,167 1,411,619 — — — 698,119 For the Year Ended December 31, 2015 Beginning Outstanding Issued Exercised Cancelled / Forfeited Ending Outstanding 2011 Transaction 686,833 — — — 686,833 2014 Transaction 376,667 — — — 376,667 ipCapital 26,667 — — — 26,667 Exercise Agreement 300,000 — — — 300,000 Consultant Warrant (1) 11,285 — — — 11,285 Offer to Exercise 10,167 — — — 10,167 1,411,619 — — — 1,411,619 |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Stockholders' Equity | 10. Stockholders’ Equity Common Stock During 2016, we awarded 35,000 shares of restricted common stock to seven members of our board of advisors. The valuation of the restricted common stock awards was based on the closing fair market value of our common stock on the grant date. For the awards made to board of advisors, such fair market value was $1.65 per share. These shares were canceled in the three-month period ended September 2016 and we did not recognize additional stock compensation expense on the unvested awards upon cancellation. On July 24, 2015 we entered into a securities purchase agreement and subscription agreement, pursuant to which we issued and sold for cash an aggregate of 2,105,919 shares of our common stock at a purchase price of $1.21 per share. We derived gross proceeds of $2,550,500 from this placement (the “2015 Transaction”). During 2015, we granted 57,911 options to purchase common stock to our Chief Financial Officer at a weighted average exercise price of $1.80 per share. During 2015, we awarded 15,000 shares of restricted common stock to employees. The valuation of the restricted common stock awards was based on the closing fair market value of our common stock on the grant date. For the awards made to employees, such fair market value ranged from $1.95 to $2.40 per share. Stock-Based Compensation Plans Active Plans 2012 Equity Incentive Plan In the case of a restricted stock award, the entire number of shares subject to such award would be issued at the time of the grant and subject to vesting provisions based on time or other conditions specified by the Board or an authorized committee of the Board. For awards based on time, should the grantee’s service to the Company end before full vesting occurred, all unvested shares would be forfeited and returned to the Company. In the case of awards granted with vesting provisions based on specific performance conditions, if those conditions were not met, then all shares would be forfeited and returned to the Company. Until forfeited, all shares issued under a restricted stock award would be considered outstanding for dividend, voting and other purposes. Under the 12 Plan, the exercise price of non-qualified stock options granted is to be no less than 100% of the fair market value of the Company’s common stock on the date the option is granted. The exercise price of incentive stock options granted is to be no less than 100% of the fair market value of the Company’s common stock on the date the option is granted provided, however, that if the recipient of the incentive stock option owns greater than 10% of the voting power of all shares of the Company’s capital stock then the exercise price will be no less than 110% of the fair market value of the Company’s common stock on the date the option is granted. The purchase price of the restricted stock issued under the 12 Plan shall also not be less than 100% of the fair market value of the Company’s common stock on the date the restricted stock is granted. All options granted under the 12 Plan are immediately exercisable by the optionee; however, there is a vesting period for the options. The options (and the shares of common stock issuable upon exercise of such options) vest, ratably, over a 33-month period; however, no options (and the underlying shares of common stock) vest until after three months from the date of the option grant. The exercise price is immediately due upon exercise of the option. The maximum term of options issued under the 12 Plan is ten years. Shares issued upon exercise of options are subject to the Company’s repurchase, which right lapses as the shares vest. The 12 Plan will terminate no later than November 7, 2022. During the year ended December 31, 2016, no options were granted under the 12 Plan. There were 35,000 shares of restricted common stock, with a weighted average grant date fair value of $1.65, granted, no options had been exercised and 229,369 shares of common stock remained available for issuance under the 12 Plan. No options previously issued under the 12 Plan were exercised during the year ended December 31, 2016. Inactive Plans The following table summarizes options outstanding as of December 31, 2016 and 2015 that were granted from stock based compensation plans that are inactive. As of December 31, 2016 no options can be granted under these plans. Options Outstanding Year Beginning of Year Granted Exercised Cancelled End of Year 2008 Stock Option Plan 2016 395,545 — (1,800 ) (13,134 ) 380,611 2005 Equity Incentive Plan 2016 14,000 — — (6,334 ) 7,666 Supplemental Stock Option Agreement 2016 333 — — — 333 409,878 — (1,800 ) (19,468 ) 388,600 2008 Stock Option Plan 2015 430,000 — (6,000 ) (28,455 ) 395,545 2005 Equity Incentive Plan 2015 17,333 — — (3,333 ) 14,000 Supplemental Stock Option Agreement 2015 333 — — — 333 447,666 — (6,000 ) (31,788 ) 409,878 Summary – All Plans A summary of the status of all of the options outstanding under all of the Company’s stock option plans, and non-plan grants to consultants, as of December 31, 2016 and 2015, and changes during the years then ended, is presented in the following table: 2016 2015 Shares Weighted Average Exercise Price Shares Weighted Average Exercise Price Beginning 705,990 $ 2.63 685,867 $ 2.70 Granted — $ — 57,911 $ 1.80 Exercised (1,800 ) $ 0.81 (6,000 ) $ 0.79 Forfeited or expired (19,468 ) $ 2.74 (31,788 ) $ 3.26 Ending 684,722 $ 2.64 705,990 $ 2.63 Exercisable at year-end 684,722 2.64 705,990 $ 2.63 Vested or expected to vest at year-end 684,571 $ 2.64 704,763 $ 2.64 Weighted average fair value of options granted during the period $ 2.64 $ 2.63 As of December 31, 2016 and 2015, of the options exercisable, 615,172 and 526,648 were vested, respectively. The following table summarizes information about stock options outstanding as of December 31, 2016: Options Outstanding Options Exercisable Range of Exercise Price Number Outstanding Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price Number Exercisable Weighted Average Exercise Price $0.75-$1.80 100,842 6.25 $ 1.37 85,734 $ 1.30 $1.82-$1.82 93,334 7.43 $ 1.82 77,778 $ 1.83 $2.06-$2.40 70,001 5.78 $ 2.28 68,889 $ 2.29 $2.48-$2.48 7,332 0.04 $ 2.48 7,332 $ 2.48 $2.54-$2.54 113,335 7.93 $ 2.54 75,554 $ 2.54 $2.55-$3.00 74,001 5.05 $ 2.71 74,001 $ 2.71 $3.03-$3.30 40,601 4.97 $ 3.07 40,601 $ 3.07 $3.45-$3.45 103,083 5.02 $ 3.45 103,083 $ 3.45 $4.20-44.20 80,000 4.69 $ 4.20 80,000 $ 4.20 $5.70-$6.88 2,193 4.97 $ 6.38 2,200 $ 6.38 $0.75-$6.68 684,722 6.0 $ 2.64 615,172 $ 2.68 As of December 31, 2016, there were outstanding options to purchase 684,722 shares of common stock with a weighted average exercise price of $2.64 per share, a weighted average remaining contractual term of 6 years and an aggregate intrinsic value of $0. Of the options outstanding as of December 31, 2016, 615,172 were vested, 69,399 were estimated to vest in future periods and 151 were estimated to be forfeited or to expire in future periods. As of December 31, 2016, there was approximately $48,100 of total unrecognized compensation cost, net of estimated forfeitures, related to unvested options. That cost is expected to be recognized over a weighted-average period of approximately twelve months. During 2016, the Company awarded 35,000 shares of restricted common stock, which vest ratably, over a 12-month period; however, these shares were canceled in the three-month period ended September 30, 2016. The Company includes the common stock underlying the restricted stock award in shares outstanding once the common stock underlying the restricted stock award has vested and the restriction has been removed (“releases” or “released”). A summary of the status of all of the Company’s unreleased restricted stock awards as of December 31, 2016 and 2015 and changes during the years then ended, is summarized in the following table. 2016 2015 Shares Weighted Average Fair Value Shares Weighted Average Fair Value Beginning unreleased 106,586 $ 2.31 287,666 $ 2.66 Awarded 35,000 $ 1.65 15,000 $ 2.35 Released (71,429 ) $ 2.32 (116,500 ) $ 3.09 Forfeited (70,157 ) $ 1.91 (79,580 ) $ 2.42 Ending unreleased - 106,586 $ 2.31 There are no unreleased restricted stock awards at December 31,2016. As of December 31, 2016, there was approximately $0 of total unrecognized compensation cost, net of estimated forfeitures, related to unreleased restricted stock awards. During the year, we accelerated and released all of the remaining of employees’ unvested restricted award shares. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 11. Income Taxes The components of the provision (benefit) for income taxes for the years ended December 31, 2016 and 2015 consisted of the following: 2016 2015 Current Federal $ — $ — State — — Foreign 2,800 3,700 $ 2,800 $ 3,700 Deferred Federal $ — $ — State — — Foreign — — — — Total $ 2,800 $ 3,700 The following table summarizes the differences between income tax expense and the amount computed applying the federal income tax rate of 34% for the years ended December 31, 2016 and 2015: 2016 2015 Federal income tax (benefit) at statutory rate $ (629,000 ) $ (1,491,600 ) State income tax (benefit) at statutory rate (3,700 ) (8,100 ) Foreign tax rate differential (300 ) 700 Compensation from exercise of non-qualified stock options and restricted stock awards 2,100 3,400 SBC – NQ cancellations 163,100 23,500 Change in valuation allowance 434,000 1,470,000 Warrant liability (10,000 ) (65,100 ) Meals and entertainment (50%) 2,500 7,700 Tax rate changes (800 ) (2,500 ) Other items 44,900 65,700 Provision (benefit) for income tax $ 2,800 $ 3,700 Deferred income taxes and benefits result from temporary timing differences in the recognition of certain expense and income items for tax and financial reporting purposes. The following table sets forth those differences as of December 31, 2016 and 2015: 2016 2015 Net operating loss carryforwards $ 21,808,000 $ 21,033,000 Tax credit carryforwards 1,047,000 1,047,000 Compensation expense – non-qualified stock options 620,000 730,000 Deferred revenue and maintenance service contracts 1,181,000 1,344,400 Warrant liability - 1,000 Reserves and other 73,000 157,000 Total deferred tax assets 24,729,000 24,312,000 Deferred tax liability – depreciation, amortization and capitalized software (7,000 ) (24,000 ) Net deferred tax asset 24,722,000 24,288,000 Valuation allowance (24,722,000 ) (24,288,000 ) Net deferred tax asset $ — $ — For financial reporting purposes, with the exception of the year ended December 31, 2007, the Company has incurred a loss in each year since inception. Based on the available objective evidence, management believes it is more likely than not that the net deferred tax assets will not be fully realizable. Accordingly, the Company has provided a full valuation allowance against its net deferred tax assets at December 31, 2016 and 2015. The net change in the valuation allowance was $(434,000) and $(1,470,000) for the years ended December 31, 2016 and 2015, respectively. At December 31, 2016, the Company had approximately $63.3 million of federal net operating loss carryforwards and approximately $6.9 million of California state net operating loss carryforwards available to reduce future taxable income. The federal loss carry forwards will begin to expire in 2018 and the California state loss carry forwards began to expire in 2015. During the years ended December 31, 2016 and 2015, the Company did not utilize any of its federal or California net operating losses. Under the Tax Reform Act of 1986, the amounts of benefits from net operating loss carryforwards may be impaired or limited if the Company incurs a cumulative ownership change of more than 50%, as defined, over a three-year period. At December 31, 2016, the Company had approximately $1 million of federal research and development tax credits that will begin to expire in 2018. |
Concentration of Credit Risk
Concentration of Credit Risk | 12 Months Ended |
Dec. 31, 2016 | |
Risks and Uncertainties [Abstract] | |
Concentration of Credit Risk | 12. Concentration of Credit Risk Financial instruments, which potentially subject the Company to concentration of credit risk, consist principally of cash and trade receivables. The Company places cash and, when applicable, cash equivalents, with high quality financial institutions and, by policy, limits the amount of credit exposure to any one financial institution. As of December 31, 2016, the Company had approximately $330,400 of cash with financial institutions in excess of FDIC insurance limits. As of December 31, 2015, the Company had approximately $1,559,900 of cash with financial institutions in excess of FDIC insurance limits. For the years ended December 31, 2016 and December 31, 2015, the Company considered the following to be its most significant customers: 2016 2015 Customer % Sales % Accounts Receivable % Sales % Accounts Receivable Alcatel 6.0 % 0.6 % 4.9 % 4.6 % Broadridge 0.6 % 6.3 % 0.5 % 4.7 % Centric Systems 5.0 % 11.5 % 5.0 % 13.2 % Elosoft 11.0 % 18.8 % 10.9 % 14.8 % GE 4.4 % 13.8 % 2.0 % 4.4 % KitASP 8.0 % 1.5 % 3.8 % 16.1 % Raytheon 3.4 % 6.5 % 9.4 % 1.6 % Uniface 6.1 % 10.9 % 5.3 % 1.9 % Xerox 3.2 % 7.3 % 3.3 % 7.6 % Total 47.7 % 77.2 % 45.1 % 68.9 % The Company performs credit evaluations of customers’ financial condition whenever necessary, and does not require cash collateral or other security to support customer receivables. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 13. Commitments and Contingencies Operating Leases On August 24, 2015, we entered into a new office lease effective on October 1, 2015, for our corporate headquarters in Campbell, California which is better suited to our California operations and results in significant monthly savings. The term of this lease is from October 1, 2015 through September 30, 2018. On August 11, 2015 we entered into a sublease agreement to sublease the entirety of the South Bascom office space, our former corporate offices, to a third party. We are currently leasing 10,659 square feet under a five-year lease that, unless renewed, will expire in October 2018. The term of the sublease extends from November 1, 2015 through the end of our office lease term for that space in October, 2018. The monthly rent payments due to hopTo under this sublease fully offset the monthly rent payments due to the landlord under hopTo’s lease for that space. The following table sets forth the net minimum lease payments we will be required to make throughout the remainder of these leases: Year Ending December 31, 2017 $ 114,300 2018 68,300 $ 182,600 Rent expense aggregated approximately $141,700 and $396,400 for the years ended December 31, 2016 and 2015, respectively. Contingencies. The Company enters into indemnification provisions under (i) its agreements with other companies in its ordinary course of business, including contractors and customers and (ii) its agreements with investors. Under these provisions, the Company generally indemnifies and holds harmless the indemnified party for losses suffered or incurred by the indemnified party as a result of the Company’s activities or, in some cases, as a result of the indemnified party’s activities under the agreement. These indemnification provisions often include indemnifications relating to representations made by the Company with regard to intellectual property rights, and often survive termination of the underlying agreement. The maximum potential amount of future payments the Company could be required to make under these indemnification provisions is unlimited. The Company has not incurred material costs to defend lawsuits or settle claims related to these indemnification agreements. As a result, the Company believes the estimated fair value of these agreements is minimal. Accordingly, the Company has no liabilities recorded for these agreements as of December 31, 2016. The Company’s software license agreements also generally include a performance guarantee that the Company’s software products will operate substantially as described in the applicable program documentation for a period of 90 days after delivery. The Company also generally warrants that services that the Company performs will be provided in a manner consistent with reasonably applicable industry standards. To date, the Company has not incurred any material costs associated with these warranties and has no liabilities recorded for these agreements as of December 31, 2016. During the year ended December 31, 2016, we reported non-cash expense of $571,100 related to potential liquidated damages resulting from delays in filing registration statements for shares and shares underlying warrants for certain private placements that the Company closed in prior periods. There were no such expenses recorded in the year ended December 31, 2015. While we believe that the applicable agreements, in most cases, provide exceptions or defenses to liquidated damages that may result in the reduction or non-payment of such damages, we have chosen to accrue to the full extent potentially required by the registration rights agreements that contained liquidated damages provisions due to uncertainty of such matters. The potential liquidated damages is reported as other current liabilities on the consolidated balance sheet and as a component of general and administrative expense on the consolidated statements of operations. During the three-month period ended September 30, 2016, our CEO and CFO voluntarily agreed with our board of directors to defer 50% of their salaries beginning September 1, 2016 until such time as the Company can reasonably pay such compensation, upon approval by the board of directors. There is currently no definitive schedule for such payments. The deferred salaries are recorded as a component of accounts payable and accrued expenses on the consolidated balance sheet. Employment Agreement – Eldad Eilam On August 21, 2013, our Board of Directors and Compensation Committee approved a new employment agreement for Eldad Eilam, our President and Chief Executive Officer. Under the employment agreement, Mr. Eilam will receive an annual base salary of $275,000 and will be eligible for a performance-based bonus in the discretion of our Compensation Committee. The employment agreement modified the vesting provisions of restricted shares and stock options that had previously been awarded to Mr. Eilam. Under such modified vesting provisions, which previously only accelerated in connection with a termination without cause and only in certain specified change of control situations, if Mr. Eilam’s employment is terminated as a result of death or disability, by the Company without cause, or by Mr. Eilam for good reason, or following a change in control, then all of Mr. Eilam’s unvested restricted shares and stock options shall immediately vest. Mr. Eilam is an at-will employee, however, in the event that Mr. Eilam’s employment is terminated by the Company without cause, or Mr. Eilam terminates his employment for good reason or following a change in control, then, in addition to the vesting of Mr. Eilam’s unrestricted shares and stock options as noted above, Mr. Eilam shall receive his base salary for a period of 12 months and shall also receive payment or reimbursement for a period of 12 months of the full cost to Mr. Eilam of any Company provided health insurance that Mr. Eilam elects to obtain for Mr. Eilam and any of his eligible dependents. As a condition to Mr. Eilam receiving such payments, Mr. Eilam will have to execute and deliver to the Company a general release. At all times that Mr. Eilam is an employee of the Company, the Company, at its own expense, shall provide life insurance on Mr. Eilam’s life with a death benefit in an amount not less than $1,000,000 and shall also maintain long-term disability insurance on Mr. Eilam. During the three month period ended September 30, 2016, Mr. Eilam voluntarily agreed with our board of directors to defer 50% of his salary beginning September 1, 2016 until such time as the Company can reasonably pay such compensation upon approval by the board of directors. |
Employee 401(k) Plan
Employee 401(k) Plan | 12 Months Ended |
Dec. 31, 2016 | |
Compensation and Retirement Disclosure [Abstract] | |
Employee 401(k) Plan | 14. Employee 401(k) Plan In December 1998, the Company adopted a 401(k) Plan (the “Plan”), to provide retirement benefits for employees. As allowed under Section 401(k) of the Internal Revenue Code, the Plan provides tax-deferred salary deductions for eligible employees. Employees may contribute up to 15% of their annual compensation to the Plan, limited to a maximum annual amount as set periodically by the Internal Revenue Service. In addition, the Company may make discretionary/matching contributions. During 2016 and 2015, the Company contributed a total of approximately $39,100 and $44,000, to the Plan, respectively. |
Supplemental Disclosure of Cash
Supplemental Disclosure of Cash Flow Information | 12 Months Ended |
Dec. 31, 2016 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Disclosure of Cash Flow Information | 15. Supplemental Disclosure of Cash Flow Information The following table presents supplemental disclosure information for the statements of cash flows for the years ended December 31, 2016 and 2015: 2016 2015 Cash Paid: Income Taxes (1) $ 2,900 $ 4,400 Interest — — (1) All such disbursements were for the payment of foreign income taxes. During 2016 and 2015, we incurred $15,500 and $182,400, respectively, of impairment loss from writing down certain capitalized software development cost that were associated with our consumer products During 2016, the Company reduced its warrants liability by $31,600 of which $31,600 was recorded in the Consolidated Statement of Operations. During 2015, the Company reduced its warrants liability by $615,700, of which $208,400 was recorded in the Consolidated Statement of Operations. During 2015, we incurred $116,400 of issuance cost for our 2015 Transaction funding for which $30,000 of cash was not disbursed. During 2015, we reclassified our short-term security deposit for our Campbell Avenue lease of $40,700 from non-current other assets to prepaid. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 16. Related Party Transactions ipCapital Group, Inc. On October 11, 2011, we engaged 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 years ended December 31, 2016 and 2015, there were no services performed, additional charges incurred or payments made to ipCapital under the agreement. In addition to the fees we agreed to pay ipCapital for its services, we issued ipCapital a five-year warrant to purchase up to 26,667 shares of our common stock at an initial price of $3.90 per share. Half of the warrant (13,333 shares) has a time-based vesting condition, with such vesting to occur in three equal annual installments. The first, second, and third vesting installments occurred on October 11, 2012, 2013, and 2014. The remaining 13,333 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 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; thus, we will accrete the fair value of the warrant as a liability over the anticipated service period. Additionally, in accordance with the liability method of accounting, we will re-measure the fair value of the then-outstanding warrant at each future balance sheet date and recognize the change in fair value as general and administrative compensation expense. (See Note 9) We recognized $(2,300) and $(18,100) as a component of general and administrative expense during the years ended December 31, 2016 and 2015, respectively, resulting from the change in fair value. The warrants expired on October 11, 2016. ipCapital Licensing Company I, LLC In February 2013, we entered into an IP Brokerage agreement with ipCapital Licensing Company I, LLC (“ipCLC”) (the “IP Brokerage Agreement”). At the time that we entered into this agreement, John Cronin was a partner at ipCLC. He is no longer affiliated with ipCLC. Pursuant to the IP Brokerage Agreement, we 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. In June 2016, we determined that the IP Brokerage Agreement is no longer in effect since ipCLC no longer exists as an entity. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Segment Information | 17. Segment Information The Company’s operations have historically been conducted and reported in two segments, GO-Global and hopTo, each representing a specific product line and dedicated operating resources. During the fourth quarter of 2014, the Company developed its hopTo Work product and go to market strategy, and beginning in January of 2015, it reorganized to a functional organization structure with consolidated decision-making authority over engineering, product management, sales and marketing resources. Resources in these functional departments are now shared for the development, sales and support of both the GO-Global and hopTo products. The GO-Global and hopTo Work products also have similar target customers, distribution channels, and common reseller partners. Beginning with the three-month period ended March 31, 2015, the Company will no longer report financial results in two segments. Software revenue and services revenue for the hopTo Work product will be included in the Windows software and Windows services revenue, respectively. Revenue by country for the years ended December 31, 2016 and 2015 was as follows: Years Ended December 31, Revenue by Country 2016 2015 United States $ 1,554,800 $ 2,267,600 Brazil 606,600 666,400 Other Countries 1,839,900 2,047,000 Total $ 4,001,300 $ 4,981,000 |
Significant Accounting Polici24
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Use of Estimates | Basis of Presentation and Use of Estimates |
Cash Equivalents | Cash Equivalents |
Property and Equipment | Property and Equipment |
Shipping and Handling | Shipping and Handling |
Software Development Costs | Software Development Costs “Costs of Software to be Sold, Leased or Marketed,” |
Revenue Recognition | Revenue Recognition Software license revenues are recognized when: ● Persuasive evidence of an arrangement exists (i.e., when the Company signs a non-cancelable 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 generally 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 programs), and ● The price to the customer is fixed or determinable, as typically evidenced in a signed non-cancelable 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, or customer training. The Company limits its 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 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 evidence 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 the Company 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 one or more licenses from a stocking reseller’s inventory (a “draw down order”), the Company will ship the licenses(s) in accordance with the draw down order’s instructions. The Company defers 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 purchasers of the Company’s software products. Revenue is recognized from maintenance contracts ratably over the related contract period, which generally ranges from one to five years. All of the Company’s software licenses are denominated in U.S. dollars. |
Deferred Rent | Deferred Rent Incentives 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. The unamortized portion of these incentives are recorded as a part of deferred rent in current or long-term liabilities, as appropriate. |
Postemployment Benefits (Severance Liability) | Post-employment Benefits (Severance Liability) |
Allowance for Doubtful Accounts | Allowance for Doubtful Accounts Beginning Balance Charge Offs Recoveries Provision Ending Balance 2016 $ 17,300 $ (3,700 ) $ — $ (5,900 ) $ 7,700 2015 $ 32,600 $ — $ — $ (15,300 ) $ 17,300 |
Income Taxes | Income Taxes “Income Taxes,” The Company and one or more of its subsidiaries are subject to United States federal income taxes, as well as income taxes of multiple state and foreign jurisdictions. The Company and its subsidiaries are no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years prior to 2011. There are no tax examinations currently underway for any of the Company’s or its subsidiaries’ tax returns for years subsequent to 2010. The Company’s policy for deducting interest and penalties is to treat interest as interest expense and penalties as taxes. The Company had not accrued any amount for the payment of interest or penalties related to any uncertain tax positions at either December 31, 2016 or 2015, as its review of such positions indicated that such potential positions were minimal. Under FASB ASC 740-10-05, “Income Taxes,” |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The fair value of the Company’s warrants are determined in accordance with FASB ASC 820, “Fair Value Measurement,” ● 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 December 31, 2016 and 2015, all of the Company’s $0 and $31,600 Warrants Liability reported at fair value, respectively, were categorized as Level 3 inputs (see Note 9). |
Derivative Financial Instruments | Derivative Financial Instruments |
Long-Lived Assets | Long-Lived Assets |
Loss Contingencies | Loss Contingencies |
Stock-Based Compensation | Stock-Based Compensation Compensation – Stock Compensation. Valuation and Expense Information Under FASB ASC 718-10 The Company recorded stock-based compensation expense of $324,400 and $757,500 in the years ended December 31, 2016 and 2015, respectively. No expense was capitalized related to software development. As required by FASB ASC 718-10, the Company estimates forfeitures of employee stock-based awards and recognizes compensation cost only for those awards expected to vest. Forfeiture rates are estimated based on an analysis of historical experience and are adjusted to actual forfeiture experience as needed. During 2016, we awarded 35,000 shares of restricted common stock to seven members of our board of advisors. The valuation of the restricted common stock awards was based on the closing fair market value of our common stock on the grant date. For these awards, such fair market value was $1.65 per share. These shares were canceled in the three month period ended September 2016. For all options granted during 2016 and 2015, the Company set the exercise price equal to the closing fair market value of the Company’s common stock as of the date of grant. We did not issue any options during 2016. The following table illustrates the non-cash stock-based compensation expense recorded during the years ended December 31, 2016 and 2015 by income statement classification: 2016 2015 Cost of revenue $ 5,600 $ 9,000 Selling and marketing expense 69,200 148,700 General and administrative expense 156,000 499,500 Research and development expense 93,600 100,300 $ 324,400 $ 757,500 The Company estimated the fair value of each option grant made during the years ended December 31, 2016 and 2015 on the date of grant using a binomial model, with the assumptions set forth in the following table: 2016 2015 Estimated volatility - 103 % Annualized forfeiture rate - 0 % Expected option term (years) - 10.00 Estimated exercise factor - 15.0 Approximate risk-free interest rate - 0.74 % Expected dividend yield — — The estimated annualized forfeiture rate was based on an analysis of historical data and considered the impact of events such as work force reductions we carried out in previous years. The expected term of our stock-based awards was based on historical award holder exercise patterns and considered the market performance of our common stock and other items. 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. The Company used the average historical volatility of its daily closing price for a period of time equal in length to the expected option term for the option being issued. The period of time over which historical volatility was measured ended on the last day of the quarterly reporting period during which the stock-based award was made. The Company does not anticipate paying dividends on its common stock for the foreseeable future. |
Earnings Per Share of Common Stock | Earnings Per Share of Common Stock “Earnings Per Share,” |
Comprehensive Loss | Comprehensive Loss “Reporting Comprehensive Income,” |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In December 2016, the FASB issued ASU No. 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers Revenue from Contracts with Customers (Topic 606)” In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments In May 2016, the FASB issued ASU 2016-12— Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients In April 2016, the FASB issued ASU 2016-10— Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing to clarify certain aspects of ASU 2014-09 In March 2016, the FASB issued ASU 2016-09— Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting In March 2016, the FASB issued ASU 2016-08— Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net) In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) In November 2015, the FASB issued ASU 2015-17, Balance Sheet Classification of Deferred Taxes In August 2015, FASB issued ASU No. 2015-14 “ Revenue from Contracts with Customers (Topic 606)” – Deferral of the Effective Date In April 2015, FASB issued ASU No. 2015-05 “ Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement” In August 2014, FASB issued Accounting Standards Update (“ASU”) No. 2014-15 “ Preparation of Financial Statements - Going Concern (Subtopic 205-40).” In May 2014, FASB issued ASU No. 2014-09 “ Revenue from Contracts with Customers (Topic 606)” 1. Removes inconsistencies and weaknesses in revenue requirements. 2. Provides a more robust framework for addressing revenue issues. 3. Improves comparability of revenue recognition practices across entities, industries, jurisdictions, and capital markets. 4. Provides more useful information to users of financial statements through improved disclosure requirements. 5. Simplifies the preparation of financial statements by reducing the number of requirements to which an entity must refer. The core principle of ASU 2014-09 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2014-09 is effective for annual reporting periods beginning after December 15, 2016, including interim periods within such annual period. Early adoption is not permitted. We are currently evaluating this ASU in order to determine whether or not its adoption will have a material impact on our results of operations, cash flows or financial position. |
Significant Accounting Polici25
Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Schedule of Allowance for Doubtful Accounts | The following table illustrates the details of the Allowance for Doubtful Accounts for the years ended December 31, 2016 and 2015: Beginning Balance Charge Offs Recoveries Provision Ending Balance 2016 $ 17,300 $ (3,700 ) $ — $ (5,900 ) $ 7,700 2015 $ 32,600 $ — $ — $ (15,300 ) $ 17,300 |
Schedule of Employee Service Share-based Compensation Expense | The following table illustrates the non-cash stock-based compensation expense recorded during the years ended December 31, 2016 and 2015 by income statement classification: 2016 2015 Cost of revenue $ 5,600 $ 9,000 Selling and marketing expense 69,200 148,700 General and administrative expense 156,000 499,500 Research and development expense 93,600 100,300 $ 324,400 $ 757,500 |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | The Company estimated the fair value of each option grant made during the years ended December 31, 2016 and 2015 on the date of grant using a binomial model, with the assumptions set forth in the following table: 2016 2015 Estimated volatility - 103 % Annualized forfeiture rate - 0 % Expected option term (years) - 10.00 Estimated exercise factor - 15.0 Approximate risk-free interest rate - 0.74 % Expected dividend yield — — |
Capitalized Software Developm26
Capitalized Software Development Costs (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Research and Development [Abstract] | |
Schedule of Capitalized Software Development Costs | Capitalized software development costs as of December 31, 2016 and 2015 consisted of the following: 2016 2015 Software development costs $ 490,400 $ 518,800 Accumulated amortization (490,400 ) (498,000 ) $ - $ 20,800 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment as of December 31, 2016 and 2015 consisted of the following: 2016 2015 Equipment $ 258,700 $ 313,700 Furniture & fixture 190,600 233,900 Leasehold improvements 167,600 167,600 616,900 715,200 Less: accumulated depreciation and amortization 473,600 462,700 $ 143,300 $ 252,500 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Liabilities | Accrued expenses as of December 31, 2016 and 2015 consisted of the following: 2016 2015 Consulting services $ 35,000 $ 40,200 Franchise tax 1,500 3,200 Software and subscription fees 2,300 4,900 Board of director fees 23,000 - Royalty fees 10,800 - Other 14,800 21,300 $ 87,400 $ 69,600 |
Deferred Rent (Tables)
Deferred Rent (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Revenue | |
Summary of Deferred Rent | As of December 31, 2016 deferred rent was: Component Current Liabilities Long-Term Liabilities Total Deferred rent expense $ (15,600 ) $ (30,500 ) $ (46,100 ) Deferred rent benefit 39,700 33,100 72,800 $ 24,100 $ 2,600 $ 26,700 As of December 31, 2015 deferred rent was: Component Current Liabilities Long-Term Liabilities Total Deferred rent expense $ (18,700 ) $ (46,100 ) $ (64,800 ) Deferred rent benefit 39,700 72,800 112,500 $ 21,000 $ 26,700 $ 47,700 |
Liability Attributable to War30
Liability Attributable to Warrants (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Other Liabilities Disclosure [Abstract] | |
Fair Value, Assets and Liabilities Measured On Nonrecurring Basis, Valuation Techniques | We used a binomial pricing model to determine the fair value of our warrants liability as of December 31, 2016 and 2015, the balance sheet dates, respectively, using the following assumptions: For the Year Ended December 31, 2016 Warrants Estimated Volatility Annualized Forfeiture Rate Expected Option Term (Years) Estimated Exercise Factor Risk-Free Interest Rate Dividends 2011 Private Placement 108% - 162% — 0.6 - 0 -3.5 – 1.1 -0.20% - 0.26-% — ipCapital 125% - 378% — 0.71 - 0- -4.0 – 1.1 -0.20% - 0.26-% — For the Year Ended December 31, 2015 Warrants Estimated Volatility Annualized Forfeiture Rate Expected Option Term (Years) Estimated Exercise Factor Risk-Free Interest Rate Dividends 2011 Private Placement 104% - 132 — 1.61 – 0.68 3.5 0.26% - 0.47% — ipCapital 105% - 127% — 1.79 – 0.79 4 0.26% - 0.54% — |
Fair Value, Liabilities Measured On Recurring Basis, Unobservable Input Reconciliation | The following table is a reconciliation of the warrants liability measured at fair value using significant unobservable inputs (Level 3) for the year ended December 31, 2016: Warrants liability – December 31, 2015 fair value $ 31,600 Change in fair value of warrant liability recorded in other income (29,300 ) Change in fair value of warrant liability recorded in general and administrative expense (2,300 ) Warrants liability – December 31, 2016 fair value $ - |
Schedule of Stockholders' Equity Note, Warrants or Rights | The following tables reconcile the number of warrants outstanding for the periods indicated: For the Year Ended December 31, 2016 Beginning Outstanding Issued Exercised Cancelled / Forfeited Ending Outstanding 2011 Transaction 686,833 — (686,833) — 2014 Transaction 376,667 — — — 376,667 ipCapital 26,667 — — (26,667) — Exercise Agreement 300,000 — — — 300,000 Consultant Warrant 11,285 — — — 11,285 Offer to Exercise 10,167 — — — 10,167 1,411,619 — — — 698,119 For the Year Ended December 31, 2015 Beginning Outstanding Issued Exercised Cancelled / Forfeited Ending Outstanding 2011 Transaction 686,833 — — — 686,833 2014 Transaction 376,667 — — — 376,667 ipCapital 26,667 — — — 26,667 Exercise Agreement 300,000 — — — 300,000 Consultant Warrant (1) 11,285 — — — 11,285 Offer to Exercise 10,167 — — — 10,167 1,411,619 — — — 1,411,619 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Schedule of Share-based Compensation, Activity | As of December 31, 2016 no options can be granted under these plans. Options Outstanding Year Beginning of Year Granted Exercised Cancelled End of Year 2008 Stock Option Plan 2016 395,545 — (1,800 ) (13,134 ) 380,611 2005 Equity Incentive Plan 2016 14,000 — — (6,334 ) 7,666 Supplemental Stock Option Agreement 2016 333 — — — 333 409,878 — (1,800 ) (19,468 ) 388,600 2008 Stock Option Plan 2015 430,000 — (6,000 ) (28,455 ) 395,545 2005 Equity Incentive Plan 2015 17,333 — — (3,333 ) 14,000 Supplemental Stock Option Agreement 2015 333 — — — 333 447,666 — (6,000 ) (31,788 ) 409,878 |
Schedule of Share-based Compensation, Stock Options, Activity | A summary of the status of all of the options outstanding under all of the Company’s stock option plans, and non-plan grants to consultants, as of December 31, 2016 and 2015, and changes during the years then ended, is presented in the following table: 2016 2015 Shares Weighted Average Exercise Price Shares Weighted Average Exercise Price Beginning 705,990 $ 2.63 685,867 $ 2.70 Granted — $ — 57,911 $ 1.80 Exercised (1,800 ) $ 0.81 (6,000 ) $ 0.79 Forfeited or expired (19,468 ) $ 2.74 (31,788 ) $ 3.26 Ending 684,722 $ 2.64 705,990 $ 2.63 Exercisable at year-end 684,722 2.64 705,990 $ 2.63 Vested or expected to vest at year-end 684,571 $ 2.64 704,763 $ 2.64 Weighted average fair value of options granted during the period $ 2.64 $ 2.63 |
Schedule of Share-based Compensation, Shares Authorized under Stock Option Plans, by Exercise Price Range | The following table summarizes information about stock options outstanding as of December 31, 2016: Options Outstanding Options Exercisable Range of Exercise Price Number Outstanding Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price Number Exercisable Weighted Average Exercise Price $0.75-$1.80 100,842 6.25 $ 1.37 85,734 $ 1.30 $1.82-$1.82 93,334 7.43 $ 1.82 77,778 $ 1.83 $2.06-$2.40 70,001 5.78 $ 2.28 68,889 $ 2.29 $2.48-$2.48 7,332 0.04 $ 2.48 7,332 $ 2.48 $2.54-$2.54 113,335 7.93 $ 2.54 75,554 $ 2.54 $2.55-$3.00 74,001 5.05 $ 2.71 74,001 $ 2.71 $3.03-$3.30 40,601 4.97 $ 3.07 40,601 $ 3.07 $3.45-$3.45 103,083 5.02 $ 3.45 103,083 $ 3.45 $4.20-44.20 80,000 4.69 $ 4.20 80,000 $ 4.20 $5.70-$6.88 2,193 4.97 $ 6.38 2,200 $ 6.38 $0.75-$6.68 684,722 6.0 $ 2.64 615,172 $ 2.68 |
Schedule of Unvested Restricted Stock Units Roll Forward | A summary of the status of all of the Company’s unreleased restricted stock awards as of December 31, 2016 and 2015 and changes during the years then ended, is summarized in the following table. 2016 2015 Shares Weighted Average Fair Value Shares Weighted Average Fair Value Beginning unreleased 106,586 $ 2.31 287,666 $ 2.66 Awarded 35,000 $ 1.65 15,000 $ 2.35 Released (71,429 ) $ 2.32 (116,500 ) $ 3.09 Forfeited (70,157 ) $ 1.91 (79,580 ) $ 2.42 Ending unreleased - 106,586 $ 2.31 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) | The components of the provision (benefit) for income taxes for the years ended December 31, 2016 and 2015 consisted of the following: 2016 2015 Current Federal $ — $ — State — — Foreign 2,800 3,700 $ 2,800 $ 3,700 Deferred Federal $ — $ — State — — Foreign — — — — Total $ 2,800 $ 3,700 |
Schedule of Effective Income Tax Rate Reconciliation | The following table summarizes the differences between income tax expense and the amount computed applying the federal income tax rate of 34% for the years ended December 31, 2016 and 2015: 2016 2015 Federal income tax (benefit) at statutory rate $ (629,000 ) $ (1,491,600 ) State income tax (benefit) at statutory rate (3,700 ) (8,100 ) Foreign tax rate differential (300 ) 700 Compensation from exercise of non-qualified stock options and restricted stock awards 2,100 3,400 SBC – NQ cancellations 163,100 23,500 Change in valuation allowance 434,000 1,470,000 Warrant liability (10,000 ) (65,100 ) Meals and entertainment (50%) 2,500 7,700 Tax rate changes (800 ) (2,500 ) Other items 44,900 65,700 Provision (benefit) for income tax $ 2,800 $ 3,700 |
Schedule of Deferred Tax Assets and Liabilities | The following table sets forth those differences as of December 31, 2016 and 2015: 2016 2015 Net operating loss carryforwards $ 21,808,000 $ 21,033,000 Tax credit carryforwards 1,047,000 1,047,000 Compensation expense – non-qualified stock options 620,000 730,000 Deferred revenue and maintenance service contracts 1,181,000 1,344,400 Warrant liability - 1,000 Reserves and other 73,000 157,000 Total deferred tax assets 24,729,000 24,312,000 Deferred tax liability – depreciation, amortization and capitalized software (7,000 ) (24,000 ) Net deferred tax asset 24,722,000 24,288,000 Valuation allowance (24,722,000 ) (24,288,000 ) Net deferred tax asset $ — $ — |
Concentration of Credit Risk (T
Concentration of Credit Risk (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Risks and Uncertainties [Abstract] | |
Schedules of Concentration of Risk, by Risk Factor | For the years ended December 31, 2016 and December 31, 2015, the Company considered the following to be its most significant customers: 2016 2015 Customer % Sales % Accounts Receivable % Sales % Accounts Receivable Alcatel 6.0 % 0.6 % 4.9 % 4.6 % Broadridge 0.6 % 6.3 % 0.5 % 4.7 % Centric Systems 5.0 % 11.5 % 5.0 % 13.2 % Elosoft 11.0 % 18.8 % 10.9 % 14.8 % GE 4.4 % 13.8 % 2.0 % 4.4 % KitASP 8.0 % 1.5 % 3.8 % 16.1 % Raytheon 3.4 % 6.5 % 9.4 % 1.6 % Uniface 6.1 % 10.9 % 5.3 % 1.9 % Xerox 3.2 % 7.3 % 3.3 % 7.6 % Total 47.7 % 77.2 % 45.1 % 68.9 % |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Lease Payments | The following table sets forth the net minimum lease payments we will be required to make throughout the remainder of these leases: Year Ending December 31, 2017 $ 114,300 2018 68,300 $ 182,600 |
Supplemental Disclosure of Ca35
Supplemental Disclosure of Cash Flow Information (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of Cash Flow, Supplemental Disclosures | The following table presents supplemental disclosure information for the statements of cash flows for the years ended December 31, 2016 and 2015: 2016 2015 Cash Paid: Income Taxes (1) $ 2,900 $ 4,400 Interest — — (1) All such disbursements were for the payment of foreign income taxes. |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Schedule of Revenue by Country | Revenue by country for the years ended December 31, 2016 and 2015 was as follows: Years Ended December 31, Revenue by Country 2016 2015 United States $ 1,554,800 $ 2,267,600 Brazil 606,600 666,400 Other Countries 1,839,900 2,047,000 Total $ 4,001,300 $ 4,981,000 |
Basis of Presentation (Details
Basis of Presentation (Details Narrative) | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Reverse stock split | 1-for-15 |
Going Concern and Management'38
Going Concern and Management's Liquidity Plans (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Net loss | $ 1,852,900 | $ 4,391,100 |
Accumulated deficit | 82,449,800 | $ 80,596,900 |
Working capital deficit | $ 2,396,600 | |
Compensation description | During the three month period ended September 30, 2016, Mr. Eilam voluntarily agreed with our board of directors to defer 50% of his salary beginning September 1, 2016 until such time as the Company can reasonably pay such compensation upon approval by the board of directors. |
Significant Accounting Polici39
Significant Accounting Policies (Details Narrative) | 12 Months Ended | |
Dec. 31, 2016USD ($)$ / sharesshares | Dec. 31, 2015USD ($)Integer$ / sharesshares | |
Cash equivalents, at carrying value | ||
Capitalized computer software, additions | $ (12,000) | |
Useful life software development cost maximum | 3 years | |
Minimum number of delivered elements for which evidence does not exist | Integer | 1 | |
Other employee related liabilities | 0 | $ 0 |
Unrecognized tax benefits, income tax penalties and interest accrued | 0 | 0 |
Warrants and rights outstanding | 31,600 | |
Impairment of long-lived assets held-for-use | 15,500 | 182,400 |
Allocated share-based compensation expense | 324,400 | 757,500 |
Employee service share-based compensation, allocation of recognized period costs, capitalized amount | $ 0 | $ 0 |
Options outstanding, granted | shares | ||
Share-based compensation arrangements by share-based payment award, options, grants in period, weighted average exercise price (in dollars per share) | $ / shares | ||
Number of shares that excluded from the computation of diluted earnings per share | shares | 1,382,841 | 2,224,195 |
Impairment charges of long-lived assets | ||
Restricted Stock [Member] | ||
Fair market value range | $ / shares | $ 1.65 | $ 2.35 |
Restricted Stock [Member] | Employees [Member] | ||
Non option granted | shares | 35,000 | 15,000 |
Fair market value range | $ / shares | $ 1.65 | |
Former Staff-Level Employee [Member] | ||
Severance expense | $ 5,000 | $ 5,000 |
Former Vice-President Level Employee [Member] | ||
Severance expense | $ 42,100 | $ 42,100 |
Minimum [Member] | ||
Property, plant and equipment, useful life | 3 years | |
Maintenance contract period | 1 year | |
Minimum [Member] | Restricted Stock [Member] | Employees [Member] | ||
Fair market value range | $ / shares | $ 1.95 | |
Minimum [Member] | Leasehold Improvements [Member] | ||
Property, plant and equipment, useful life | 3 years | |
Maximum [Member] | ||
Property, plant and equipment, useful life | 7 years | |
Maintenance contract period | 5 years | |
Maximum [Member] | Restricted Stock [Member] | Employees [Member] | ||
Fair market value range | $ / shares | $ 2.40 | |
Maximum [Member] | Leasehold Improvements [Member] | ||
Property, plant and equipment, useful life | 7 years |
Significant Accounting Polici40
Significant Accounting Policies - Schedule of Allowance for Doubtful Accounts (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Accounting Policies [Abstract] | ||
Beginning balance | $ 17,300 | $ 32,600 |
Charge offs | (3,700) | |
Recoveries | ||
Provision | (5,900) | (15,300) |
Ending balance | $ 7,700 | $ 17,300 |
Significant Accounting Polici41
Significant Accounting Policies - Schedule of Employee Service Share-based Compensation Expense (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Allocated share-based compensation expense | $ 324,400 | $ 757,500 |
Costs of Revenue [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Allocated share-based compensation expense | 5,600 | 9,000 |
Selling and Marketing Expense [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Allocated share-based compensation expense | 69,200 | 148,700 |
General and Administrative Expense [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Allocated share-based compensation expense | 156,000 | 499,500 |
Research and Development Expense [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Allocated share-based compensation expense | $ 93,600 | $ 100,300 |
Significant Accounting Polici42
Significant Accounting Policies - Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Accounting Policies [Abstract] | ||
Estimated volatility | 103.00% | |
Annualized forfeiture rate | 0.00% | |
Expected option term (years) | 0 years | 10 years |
Estimated exercise factor | $ 15 | |
Approximate risk-free interest rate | 0.74% | |
Expected dividend yield |
Capitalized Software Developm43
Capitalized Software Development Costs (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Research and Development [Abstract] | ||
Capitalized software development costs | $ 12,000 | |
Capitalized computer software, amortization | 5,400 | 217,500 |
Capitalized computer software impairments | $ 15,500 | $ 182,400 |
Capitalized Software Developm44
Capitalized Software Development Costs - Schedule of Capitalized Software Development Costs (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Research and Development [Abstract] | ||
Software development costs | $ 490,400 | $ 518,800 |
Accumulated amortization | (490,400) | (498,000) |
Capitalized software development costs, net | $ 20,800 |
Property and Equipment (Details
Property and Equipment (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Depreciation | $ 89,200 | $ 117,300 |
Capitalized equipment cost | ||
Property, plant and equipment, disposals | 98,300 | |
Net book value | 20,000 | |
Equipment [Member] | ||
Property, plant and equipment, disposals | 55,000 | |
Furniture and Fixtures [Member] | ||
Property, plant and equipment, disposals | $ 43,300 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Property and equipment gross | $ 616,900 | $ 715,200 |
Less: accumulated depreciation and amortization | 473,600 | 462,700 |
Property and equipment net | 143,300 | 252,500 |
Equipment [Member] | ||
Property and equipment gross | 258,700 | 313,700 |
Furniture and Fixtures [Member] | ||
Property and equipment gross | 190,600 | 233,900 |
Leasehold Improvements [Member] | ||
Property and equipment gross | $ 167,600 | $ 167,600 |
Accrued Expenses - Schedule of
Accrued Expenses - Schedule of Accrued Liabilities (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Payables and Accruals [Abstract] | ||
Consulting services | $ 35,000 | $ 40,200 |
Franchise tax | 1,500 | 3,200 |
Software and subscription fees | 2,300 | 4,900 |
Board of director fees | 23,000 | |
Royalty fees | 10,800 | |
Other | 14,800 | 21,300 |
Accrued expenses | $ 87,400 | $ 69,600 |
Severance Liability (Details Na
Severance Liability (Details Narrative) - USD ($) | 1 Months Ended | ||
Aug. 30, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | |
Related Party Transactions [Abstract] | |||
Payment made to employee medical coverage | $ 15,000 | ||
Severance liabilities | $ 5,900 |
Deferred Rent (Details Narrativ
Deferred Rent (Details Narrative) | Dec. 31, 2016USD ($) |
Revenue | |
Leasehold improvements | $ 106,600 |
Deferred Rent - Summary of Defe
Deferred Rent - Summary of Deferred Rent (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Current liabilities | $ 24,100 | $ 21,000 |
Long-term liabilities | 2,600 | 26,700 |
Total | 26,700 | 47,700 |
Deferred Rent Expense [Member] | ||
Current liabilities | (15,600) | (18,700) |
Long-term liabilities | (30,500) | (46,100) |
Total | (46,100) | (64,800) |
Deferred Rent Benefit [Member] | ||
Current liabilities | 39,700 | 39,700 |
Long-term liabilities | 33,100 | 72,800 |
Total | $ 72,800 | $ 112,500 |
Liability Attributable to War51
Liability Attributable to Warrants (Details Narrative) | Jan. 07, 2014USD ($)$ / sharesshares | Dec. 31, 2016USD ($)Integer$ / shares | Dec. 31, 2015USD ($) | Jan. 07, 2015USD ($) |
Warrants liability | $ | $ 31,600 | |||
Class of warrant or right, fair value | $ | $ 407,300 | |||
Fair value assumptions, expected volatility rate | 113.00% | |||
Fair value assumptions, annualized forfeiture rate | 0.00% | |||
Fair value assumption, exercise factor | Integer | 3.5 | |||
Fair value assumptions, risk free interest rate | 1.20% | |||
Fair value assumptions, weighted average expected dividend | $ 0 | |||
Warrants liability, period increase (decrease) | $ | $ 615,700 | $ 615,700 | ||
Securities Purchase Agreement [Member] | ||||
Class of warrant or right, number of securities called by warrants or rights | shares | 376,667 | |||
Class of warrant or right, exercise price of warrants or rights | $ 6 | |||
Warrants liability | $ | $ 1,356,000 | |||
Exercise Agreement [Member] | ||||
Fair value assumptions, expected term | 4 years 1 month 6 days | |||
2011 Transaction [Member] | Minimum [Member] | ||||
Class of warrant or right, exercise price of warrants or rights | $ 3 | |||
2011 Transaction [Member] | Maximum [Member] | ||||
Class of warrant or right, exercise price of warrants or rights | 3.90 | |||
ip Capital [Member] | ||||
Class of warrant or right, exercise price of warrants or rights | $ 3.90 | |||
2015 Transaction [Member] | ||||
Warrant Description | The 2015 Transaction (Note 10) met those conditions and resulted in the placement agent warrants being repriced from $3.00 and $3.90 to $2.55 and $3.30, respectively. On September 1, 2016, the liability warrants for the 2011 transaction expired. | |||
2015 Transaction [Member] | Minimum [Member] | ||||
Class of warrant or right, exercise price of warrants or rights | $ 3 | |||
Warrants exercise price upon reprising | 2.55 | |||
2015 Transaction [Member] | Maximum [Member] | ||||
Class of warrant or right, exercise price of warrants or rights | 3.90 | |||
Warrants exercise price upon reprising | $ 3.30 | |||
Common Stock [Member] | Securities Purchase Agreement [Member] | ||||
Stock issued during period, shares, new issues | shares | 753,333 | |||
Fair value of common stock | $ 4.50 |
Liability Attributable to War52
Liability Attributable to Warrants - Fair Value, Assets and Liabilities Measured on Nonrecurring Basis, Valuation Techniques (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Estimated volatility | 113.00% | |
Annualized forfeiture rate | 0.00% | |
Risk-free interest rate | 1.20% | |
IP Capital Group Inc [Member] | ||
Annualized forfeiture rate | ||
Estimated exercise factor | $ 4 | |
Dividends | ||
Minimum [Member] | IP Capital Group Inc [Member] | ||
Estimated volatility | 125.00% | 105.00% |
Expected term | 8 months 16 days | 1 year 9 months 15 days |
Estimated exercise factor | $ (4) | |
Risk-free interest rate | (0.20%) | 0.26% |
Maximum [Member] | IP Capital Group Inc [Member] | ||
Estimated volatility | 378.00% | 127.00% |
Expected term | 0 years | 9 months 15 days |
Estimated exercise factor | $ 1.1 | |
Risk-free interest rate | 0.26% | 0.54% |
2011 Private Placement [Member] | ||
Annualized forfeiture rate | ||
Estimated exercise factor | $ 3.5 | |
Dividends | ||
2011 Private Placement [Member] | Minimum [Member] | ||
Estimated volatility | 108.00% | 104.00% |
Expected term | 7 months 6 days | 1 year 7 months 10 days |
Estimated exercise factor | $ (3.5) | |
Risk-free interest rate | (0.20%) | 26.50% |
2011 Private Placement [Member] | Maximum [Member] | ||
Estimated volatility | 162.00% | 132.00% |
Expected term | 0 years | 8 months 5 days |
Estimated exercise factor | $ 1.1 | |
Risk-free interest rate | 0.26% | 0.47% |
Liability Attributable to War53
Liability Attributable to Warrants - Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation (Details) | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Other Liabilities Disclosure [Abstract] | |
Warrants liability | $ 31,600 |
Change in fair value of warrant liability recorded in other income | (29,300) |
Change in fair value of warrant liability recorded in general and administrative expense | (2,300) |
Warrants liability |
Liability Attributable to War54
Liability Attributable to Warrants - Schedule of Stockholders' Equity Note, Warrants or Rights (Details) - shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Beginning outstanding | 1,411,619 | 1,411,619 |
Issued | ||
Exercised | ||
Cancelled / forfeited | ||
Ending outstanding | 698,119 | 1,411,619 |
IP Capital Group Inc [Member] | ||
Beginning outstanding | 26,667 | |
Issued | ||
Exercised | ||
Cancelled / forfeited | (26,667) | |
Ending outstanding | 26,667 | |
2011 Transaction [Member] | ||
Beginning outstanding | 686,833 | 686,833 |
Issued | ||
Exercised | ||
Cancelled / forfeited | (686,833) | |
Ending outstanding | 686,833 | |
2014 Transaction [Member] | ||
Beginning outstanding | 376,667 | 376,667 |
Issued | ||
Exercised | ||
Cancelled / forfeited | ||
Ending outstanding | 376,667 | 376,667 |
Exercise Agreement [Member] | ||
Beginning outstanding | 300,000 | 300,000 |
Issued | ||
Exercised | ||
Cancelled / forfeited | ||
Ending outstanding | 300,000 | 300,000 |
Consultant Warrant [Member] | ||
Beginning outstanding | 11,285 | 11,285 |
Issued | ||
Exercised | ||
Cancelled / forfeited | ||
Ending outstanding | 11,285 | 11,285 |
Offer to Exercise [Member] | ||
Beginning outstanding | 10,167 | 10,167 |
Issued | ||
Exercised | ||
Cancelled / forfeited | ||
Ending outstanding | 10,167 | 10,167 |
IP Capital Group Inc [Member] | ||
Beginning outstanding | 26,667 | 26,667 |
Issued | ||
Exercised | ||
Cancelled / forfeited | ||
Ending outstanding | 26,667 |
Stockholders' Equity (Details N
Stockholders' Equity (Details Narrative) - USD ($) | Jul. 24, 2015 | Dec. 31, 2016 | Dec. 31, 2015 |
Note 9 - Stockholders' Equity (Details) [Line Items] | |||
Sale of stock during period | $ 2,105,919 | ||
Sale of stock price per share | $ 1.21 | ||
Sale of stock during period, value | 2,550,500 | ||
Share-based payment award, options, grants in period, gross | |||
Weighted Average Exercise Price, Granted | |||
Share based compensation arrangement by share based payment award options vested outstanding number | 615,172 | 526,648 | |
Share-based compensation, shares authorized under stock option plans, exercise price range, number of outstanding options | 648,722 | ||
Share-based compensation, shares authorized under stock option plans, exercise price range, exercisable options, weighted average exercise price (in dollars per share) | $ 2.64 | ||
Share-based compensation, shares authorized under stock option plans, exercise price range, outstanding options, weighted average remaining contractual term | 6 years | ||
Share-based compensation arrangement by share-based payment award, options, outstanding, intrinsic value (in dollars) | $ 0 | ||
Share based compensation arrangement by share based payment award options expected to vest outstanding number | 615,172 | 69,399 | |
Share based compensation arrangement by share based payment award options expected to be forfeited | 151 | ||
Employee service share-based compensation, nonvested awards, compensation not yet recognized, stock options (in dollars) | $ 48,100 | ||
Chief Financial Officer [Member] | |||
Note 9 - Stockholders' Equity (Details) [Line Items] | |||
Share-based payment award, options, grants in period, gross | 57,911 | ||
Weighted Average Exercise Price, Granted | $ 1.80 | ||
2012 Equity Incentive Plan [Member] | |||
Note 9 - Stockholders' Equity (Details) [Line Items] | |||
Share-based compensation arrangement by share-based payment award, number of shares authorized | 643,797 | ||
Share-based compensation arrangement by share-based payment award, number of shares available for grant | 229,369 | ||
All Stock Option Plans [Member] | |||
Note 9 - Stockholders' Equity (Details) [Line Items] | |||
Share-based payment award, options, grants in period, gross | 57,911 | ||
Restricted Stock [Member] | |||
Note 9 - Stockholders' Equity (Details) [Line Items] | |||
Fair market value range | $ 1.65 | $ 2.35 | |
Share-based compensation arrangement by share-based payment award, equity instruments other than options, grants in period | 35,000 | 15,000 | |
Restricted Stock [Member] | Employees [Member] | |||
Note 9 - Stockholders' Equity (Details) [Line Items] | |||
Non option granted | 35,000 | 15,000 | |
Fair market value range | $ 1.65 | ||
Restricted Stock [Member] | Minimum [Member] | Employees [Member] | |||
Note 9 - Stockholders' Equity (Details) [Line Items] | |||
Fair market value range | $ 1.95 | ||
Restricted Stock [Member] | Maximum [Member] | Employees [Member] | |||
Note 9 - Stockholders' Equity (Details) [Line Items] | |||
Fair market value range | $ 2.40 | ||
Restricted Stock [Member] | 2012 Equity Incentive Plan [Member] | |||
Note 9 - Stockholders' Equity (Details) [Line Items] | |||
Share-based compensation arrangement by share-based payment award, equity instruments other than options, grants in period | 35,000 | ||
Restricted Stock [Member] | 2012 Equity Incentive Plan [Member] | Minimum [Member] | |||
Note 9 - Stockholders' Equity (Details) [Line Items] | |||
Share-based compensation arrangement by share-based payment award, purchase price of common stock, percent | 100.00% | ||
Incentive Stock Options [Member] | 2012 Equity Incentive Plan [Member] | Minimum [Member] | |||
Note 9 - Stockholders' Equity (Details) [Line Items] | |||
Share-based compensation arrangement by share-based payment award, purchase price of common stock, percent | 100.00% | ||
Incentive Stock Options [Member] | 2012 Equity Incentive Plan [Member] | Minimum [Member] | If Recipient Owns Greater Than Ten Percent Voting Power [Member] | |||
Note 9 - Stockholders' Equity (Details) [Line Items] | |||
Share-based compensation arrangement by share-based payment award, purchase price of common stock, percent | 110.00% | ||
Non Qualified Stock Options [Member] | 2012 Equity Incentive Plan [Member] | Minimum [Member] | |||
Note 9 - Stockholders' Equity (Details) [Line Items] | |||
Share-based compensation arrangement by share-based payment award, purchase price of common stock, percent | 100.00% |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Share-based Compensation, Activity (Details) - shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Note 9 - Stockholders' Equity (Details) - Summary of Inactive Plans [Line Items] | ||
Options Outstanding, Balance | 409,878 | 447,666 |
Options Outstanding, Granted | ||
Options Outstanding, Exercised | (1,800) | (6,000) |
Options Outstanding, Cancelled | (19,468) | (31,788) |
Options Outstanding, Balance | 388,600 | 409,878 |
2008 Stock Option Plan [Member] | ||
Note 9 - Stockholders' Equity (Details) - Summary of Inactive Plans [Line Items] | ||
Options Outstanding, Balance | 395,545 | 430,000 |
Options Outstanding, Granted | ||
Options Outstanding, Exercised | (1,800) | (6,000) |
Options Outstanding, Cancelled | (13,134) | (28,455) |
Options Outstanding, Balance | 380,611 | 395,545 |
2005 Stock Option Plan [Member] | ||
Note 9 - Stockholders' Equity (Details) - Summary of Inactive Plans [Line Items] | ||
Options Outstanding, Balance | 14,000 | 17,333 |
Options Outstanding, Granted | ||
Options Outstanding, Exercised | ||
Options Outstanding, Cancelled | (6,334) | (3,333) |
Options Outstanding, Balance | 7,666 | 14,000 |
Supplemental Stock Option Agreement [Member] | ||
Note 9 - Stockholders' Equity (Details) - Summary of Inactive Plans [Line Items] | ||
Options Outstanding, Balance | 333 | 333 |
Options Outstanding, Granted | ||
Options Outstanding, Exercised | ||
Options Outstanding, Cancelled | ||
Options Outstanding, Balance | 333 | 333 |
Stockholders' Equity - Schedu57
Stockholders' Equity - Schedule of Share-based Compensation, Stock Options, Activity (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Note 9 - Stockholders' Equity (Details) - Summary of Status of All Stock Option Plans [Line Items] | ||
Options Outstanding, Balance | 409,878 | 447,666 |
Options Outstanding, Granted | ||
Options Outstanding, Exercised | 1,800 | 6,000 |
Options Outstanding, Balance | 388,600 | 409,878 |
Weighted Average Exercise Price, Granted | ||
Stock Option Plans [Member] | ||
Note 9 - Stockholders' Equity (Details) - Summary of Status of All Stock Option Plans [Line Items] | ||
Options Outstanding, Balance | 705,990 | 685,867 |
Options Outstanding, Granted | 57,911 | |
Options Outstanding, Exercised | (1,800) | (6,000) |
Options Outstanding, Forfeited or expired | (19,468) | (31,788) |
Options Outstanding, Balance | 684,722 | 705,990 |
Options Outstanding, Exercisable at year-end | 684,722 | 705,990 |
Options Outstanding, Vested or expected to vest at year-end | 684,571 | 704,763 |
Weighted Average Exercise Price, Outstanding Beginning Balance | $ 2.63 | $ 2.7 |
Weighted Average Exercise Price, Granted | 1.8 | |
Weighted Average Exercise Price, Exercised | 0.81 | 0.79 |
Weighted Average Exercise Price, Forfeited or expired | 2.74 | 3.26 |
Weighted Average Exercise Price, Outstanding Ending Balance | 2.64 | 2.63 |
Weighted Average Exercise Price, Exercisable at year-end | 2.64 | 2.63 |
Weighted Average Exercise Price, Vested or expected to vest at year-end | 2.64 | 2.64 |
Weighted average fair value of options granted during the period | $ 2.64 | $ 2.63 |
Stockholders' Equity - Schedu58
Stockholders' Equity - Schedule of Share-based Compensation, Shares Authorized under Stock Option Plans, by Exercise Price Range (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Options Outstanding, Number (in Shares) | 648,722 | |
Options Exercisable, Weighted Average Exercise Price | $ 2.64 | |
Exercise Price Range 1 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Exercise Price Range, Lower Range Limit | 0.75 | |
Exercise Price Range, Upper Range Limit | $ 1.80 | |
Options Outstanding, Number (in Shares) | 100,842 | |
Options Outstanding, Weighted Average Remaining Contractual Life | 6 years 3 months | |
Options Outstanding, Exercise Price | $ 1.37 | |
Options Exercisable, Number Exercisable (in Shares) | 85,734 | |
Options Exercisable, Weighted Average Exercise Price | $ 1.30 | |
Exercise Price Range 2 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Exercise Price Range, Lower Range Limit | 1.82 | |
Exercise Price Range, Upper Range Limit | $ 1.82 | |
Options Outstanding, Number (in Shares) | 93,334 | |
Options Outstanding, Weighted Average Remaining Contractual Life | 7 years 5 months 5 days | |
Options Outstanding, Exercise Price | $ 1.82 | |
Options Exercisable, Number Exercisable (in Shares) | 77,778 | |
Options Exercisable, Weighted Average Exercise Price | $ 1.83 | |
Exercise Price Range 3 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Exercise Price Range, Lower Range Limit | 2.06 | |
Exercise Price Range, Upper Range Limit | $ 2.40 | |
Options Outstanding, Number (in Shares) | 70,001 | |
Options Outstanding, Weighted Average Remaining Contractual Life | 5 years 9 months 11 days | |
Options Outstanding, Exercise Price | $ 2.28 | |
Options Exercisable, Number Exercisable (in Shares) | 68,889 | |
Options Exercisable, Weighted Average Exercise Price | $ 2.29 | |
Exercise Price Range 4 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Exercise Price Range, Lower Range Limit | 2.48 | |
Exercise Price Range, Upper Range Limit | $ 2.48 | |
Options Outstanding, Number (in Shares) | 7,332 | |
Options Outstanding, Weighted Average Remaining Contractual Life | 15 days | |
Options Outstanding, Exercise Price | $ 2.48 | |
Options Exercisable, Number Exercisable (in Shares) | 7,332 | |
Options Exercisable, Weighted Average Exercise Price | $ 2.48 | |
Exercise Price Range 5 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Exercise Price Range, Lower Range Limit | 2.54 | |
Exercise Price Range, Upper Range Limit | $ 2.54 | |
Options Outstanding, Number (in Shares) | 113,335 | |
Options Outstanding, Weighted Average Remaining Contractual Life | 7 years 11 months 5 days | |
Options Outstanding, Exercise Price | $ 2.54 | |
Options Exercisable, Number Exercisable (in Shares) | 75,554 | |
Options Exercisable, Weighted Average Exercise Price | $ 2.54 | |
Exercise Price Range 6 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Exercise Price Range, Lower Range Limit | 2.55 | |
Exercise Price Range, Upper Range Limit | $ 3 | |
Options Outstanding, Number (in Shares) | 74,001 | |
Options Outstanding, Weighted Average Remaining Contractual Life | 5 years 18 days | |
Options Outstanding, Exercise Price | $ 2.71 | |
Options Exercisable, Number Exercisable (in Shares) | 74,001 | |
Options Exercisable, Weighted Average Exercise Price | $ 2.71 | |
Exercise Price Range 7 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Exercise Price Range, Lower Range Limit | 3.03 | |
Exercise Price Range, Upper Range Limit | $ 3.30 | |
Options Outstanding, Number (in Shares) | 40,601 | |
Options Outstanding, Weighted Average Remaining Contractual Life | 4 years 11 months 19 days | |
Options Outstanding, Exercise Price | $ 3.07 | |
Options Exercisable, Number Exercisable (in Shares) | 40,601 | |
Options Exercisable, Weighted Average Exercise Price | $ 3.07 | |
Exercise Price Range 8 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Exercise Price Range, Lower Range Limit | 3.45 | |
Exercise Price Range, Upper Range Limit | $ 3.45 | |
Options Outstanding, Number (in Shares) | 103,083 | |
Options Outstanding, Weighted Average Remaining Contractual Life | 5 years 7 days | |
Options Outstanding, Exercise Price | $ 3.45 | |
Options Exercisable, Number Exercisable (in Shares) | 103,083 | |
Options Exercisable, Weighted Average Exercise Price | $ 3.45 | |
Exercise Price Range 9 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Exercise Price Range, Lower Range Limit | 4.20 | |
Exercise Price Range, Upper Range Limit | $ 44.20 | |
Options Outstanding, Number (in Shares) | 80,000 | |
Options Outstanding, Weighted Average Remaining Contractual Life | 4 years 8 months 9 days | |
Options Outstanding, Exercise Price | $ 4.20 | |
Options Exercisable, Number Exercisable (in Shares) | 80,000 | |
Options Exercisable, Weighted Average Exercise Price | $ 4.20 | |
Exercise Price Range 10 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Exercise Price Range, Lower Range Limit | 5.70 | |
Exercise Price Range, Upper Range Limit | $ 6.88 | |
Options Outstanding, Number (in Shares) | 2,193 | |
Options Outstanding, Weighted Average Remaining Contractual Life | 4 years 11 months 19 days | |
Options Outstanding, Exercise Price | $ 6.38 | |
Options Exercisable, Number Exercisable (in Shares) | 2,200 | |
Options Exercisable, Weighted Average Exercise Price | $ 6.38 | |
Exercise Price Range 11 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Exercise Price Range, Lower Range Limit | $ 0.75 | |
Exercise Price Range, Upper Range Limit | $ 6.68 | |
Options Outstanding, Number (in Shares) | 684,722 | |
Options Outstanding, Weighted Average Remaining Contractual Life | 6 years | |
Options Outstanding, Exercise Price | $ 2.64 | |
Options Exercisable, Number Exercisable (in Shares) | 615,172 | |
Options Exercisable, Weighted Average Exercise Price | $ 2.68 |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Status and Activity of Restricted Stock Awards (Details) - Restricted Stock [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Number of Shares Outstanding, Beginning Balance | 106,586 | 287,666 |
Number of Shares Awarded | 35,000 | 15,000 |
Number of Shares Released | (71,429) | (116,500) |
Number of Shares Forfeited | (70,157) | (79,580) |
Number of Shares Outstanding, Ending Balance | 106,586 | |
Weighted Average Grant Date Fair Value Beginning Balance | $ 2.31 | $ 2.66 |
Weighted Average Grant Date Fair Value Awarded | 1.65 | 2.35 |
Weighted Average Grant Date Fair Value Released | 2.32 | 3.09 |
Weighted Average Grant Date Fair Value Forfeited | 1.91 | 2.42 |
Weighted Average Grant Date Fair Value Ending | $ 2.31 |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Note 10 - Income Taxes (Details) [Line Items] | ||
Effective income tax rate reconciliation, at federal statutory income tax rate, percent | 34.00% | 34.00% |
Valuation allowance, deferred tax asset, increase (decrease), amount | $ (434,000) | $ (1,470,000) |
Percentage of cumulative ownership | 50.00% | |
Internal Revenue Service (IRS) [Member] | Domestic Tax Authority [Member] | ||
Note 10 - Income Taxes (Details) [Line Items] | ||
Operating loss carryforwards | $ 63,300,000 | |
Operating loss expiration date | expire in 2018 | |
Internal Revenue Service (IRS) [Member] | Domestic Tax Authority [Member] | Research Tax Credit Carryforward [Member] | ||
Note 10 - Income Taxes (Details) [Line Items] | ||
Tax credit carryforward, amount | $ 1,000,000 | |
California Franchise Tax Board [Member] | State and Local Jurisdiction [Member] | ||
Note 10 - Income Taxes (Details) [Line Items] | ||
Operating loss carryforwards | $ 6,900,000 | |
Operating loss expiration date | expire in 2015 |
Income Taxes - Schedule of Comp
Income Taxes - Schedule of Components of Income Tax Expense (Benefit) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | ||
Federal | ||
State | ||
Foreign | 2,800 | 3,700 |
Current income tax expense | 2,800 | 3,700 |
Federal | ||
State | ||
Foreign | ||
Deferred tax | ||
Total | $ 2,800 | $ 3,700 |
Income Taxes - Schedule of Effe
Income Taxes - Schedule of Effective Income Tax Rate Reconciliation (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | ||
Federal income tax (benefit) at statutory rate | $ (629,000) | $ (1,491,600) |
State income tax (benefit) at statutory rate | (3,700) | (8,100) |
Foreign tax rate differential | (300) | 700 |
Compensation from exercise of non-qualified stock options and restricted stock awards | 2,100 | 3,400 |
SBC - NQ cancellations | 163,100 | 23,500 |
Change in valuation allowance | 434,000 | 1,470,000 |
Warrant liability | (10,000) | (65,100) |
Meals and entertainment (50%) | 2,500 | 7,700 |
Tax rate changes | (800) | (2,500) |
Other items | 44,900 | 65,700 |
Provision (benefit) for income tax | $ 2,800 | $ 3,700 |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Income Tax Disclosure [Abstract] | ||
Net operating loss carryforwards | $ 21,808,000 | $ 21,033,000 |
Tax credit carryforwards | 1,047,000 | 1,047,000 |
Compensation expense - non-qualified stock options | 620,000 | 730,000 |
Deferred revenue and maintenance service contracts | 1,181,000 | 1,344,400 |
Warrant liability | 1,000 | |
Reserves and other | 73,000 | 157,000 |
Total deferred tax assets | 24,729,000 | 24,312,000 |
Deferred tax liability - capitalized software | (7,000) | (24,000) |
Net deferred tax asset | 24,722,000 | 24,288,000 |
Valuation allowance | (24,722,000) | (24,288,000) |
Net deferred tax asset |
Concentration of Credit Risk (D
Concentration of Credit Risk (Details Narrative) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Risks and Uncertainties [Abstract] | ||
Cash, FDIC insured amount | $ 330,400 | |
Cash, uninsured amount | $ 1,559,900 |
Concentration of Credit Risk -
Concentration of Credit Risk - Schedules of Concentration of Risk, by Risk Factor (Details) - Customer Concentration Risk [Member] | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Sales Revenue, Net [Member] | ||
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 47.70% | 45.10% |
Sales Revenue, Net [Member] | Alcatel-Lucent [Member] | ||
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 6.00% | 4.90% |
Sales Revenue, Net [Member] | Broadridge [Member] | ||
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 0.60% | 0.50% |
Sales Revenue, Net [Member] | Centric Systems [Member] | ||
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 5.00% | 5.00% |
Sales Revenue, Net [Member] | Elosoft [Member] | ||
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 11.00% | 10.90% |
Sales Revenue, Net [Member] | GE [Member] | ||
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 4.40% | 2.00% |
Sales Revenue, Net [Member] | KitASP [Member] | ||
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 8.00% | 3.80% |
Sales Revenue, Net [Member] | Raytheon [Member] | ||
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 3.40% | 9.40% |
Sales Revenue, Net [Member] | Uniface [Member] | ||
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 6.10% | 5.30% |
Sales Revenue, Net [Member] | Xerox [Member] | ||
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 3.20% | 3.30% |
Accounts Receivable [Member] | ||
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 77.20% | 68.90% |
Accounts Receivable [Member] | Alcatel-Lucent [Member] | ||
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 4.60% | 0.60% |
Accounts Receivable [Member] | Broadridge [Member] | ||
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 6.30% | 4.70% |
Accounts Receivable [Member] | Centric Systems [Member] | ||
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 11.50% | 13.20% |
Accounts Receivable [Member] | Elosoft [Member] | ||
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 18.80% | 14.80% |
Accounts Receivable [Member] | GE [Member] | ||
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 13.80% | 4.40% |
Accounts Receivable [Member] | KitASP [Member] | ||
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 1.50% | 16.10% |
Accounts Receivable [Member] | Raytheon [Member] | ||
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 6.50% | 1.60% |
Accounts Receivable [Member] | Uniface [Member] | ||
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 10.90% | 1.90% |
Accounts Receivable [Member] | Xerox [Member] | ||
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 7.30% | 7.60% |
Commitments and Contingencies66
Commitments and Contingencies (Details Narrative) | Aug. 11, 2015ft² | Aug. 21, 2013USD ($) | Sep. 30, 2016 | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) |
Lease square feet | ft² | 10,659 | ||||
Lease term | 5 years | ||||
Lease expire date | 2018-10 | ||||
Rent expense | $ 141,700 | $ 396,400 | |||
Non-cash expense | $ 571,100 | ||||
Employee compensation, description | CEO and CFO voluntarily agreed with our board of directors to defer 50% of their salary beginning September 1, 2016. | ||||
Compensation description | During the three month period ended September 30, 2016, Mr. Eilam voluntarily agreed with our board of directors to defer 50% of his salary beginning September 1, 2016 until such time as the Company can reasonably pay such compensation upon approval by the board of directors. | ||||
Mr.Eilam [Member] | |||||
Annual base salary | $ 275,000 | ||||
Minimum death benefit amount | $ 1,000,000 |
Commitments and Contingencies -
Commitments and Contingencies - Schedule of Future Minimum Lease Payments (Details) | Dec. 31, 2016USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,017 | $ 114,300 |
2,018 | 68,300 |
Total | $ 182,600 |
Employee 401(k) Plan (Details N
Employee 401(k) Plan (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Compensation and Retirement Disclosure [Abstract] | ||
Defined contribution plan, maximum annual contributions per employee, percent | 15.00% | |
Defined contribution plan, employer discretionary contribution amount | $ 39,100 | $ 44,000 |
Supplemental Disclosure of Ca69
Supplemental Disclosure of Cash Flow Information (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Note 14 - Supplemental Disclosure of Cash Flow Information (Details) [Line Items] | ||
Warrants liability, period increase (decrease) | $ 615,700 | $ 615,700 |
Fair value adjustment of warrants | (29,300) | (190,300) |
Issuance cost | 116,400 | |
Cash disbursed | 30,000 | |
Prepaid expense and other assets noncurrent | 40,700 | |
Deferred rent, current | 24,100 | 21,000 |
Capitalized Software [Member] | ||
Note 14 - Supplemental Disclosure of Cash Flow Information (Details) [Line Items] | ||
Capital lease obligations incurred | $ 15,500 | $ 182,400 |
Supplemental Disclosure of Ca70
Supplemental Disclosure of Cash Flow Information - Schedule of Cash Flow, Supplemental Disclosures (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | ||
Supplemental Cash Flow Elements [Abstract] | |||
Income Taxes | [1] | $ 2,900 | $ 4,400 |
Interest | |||
[1] | All such disbursements were for the payment of foreign income taxes. |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) | Oct. 11, 2014shares | Oct. 11, 2013shares | Oct. 11, 2012shares | Dec. 31, 2016USD ($)Installments$ / sharesshares | Dec. 31, 2015USD ($) |
Fair value adjustment of warrants | $ | $ (29,300) | $ (190,300) | |||
IP Capital Group Inc [Member] | |||||
Warrant term | 5 years | ||||
Class of warrant or right, number of securities called by warrants or rights (in shares) | 26,667 | ||||
Class of warrant or right, exercise price of warrants or rights (in dollars per share) | $ / shares | $ 3.90 | ||||
Number of vesting installments | Installments | 3 | ||||
Number of warrants to vest, shares | 13,333 | 13,333 | 13,333 | ||
Remaining warrants to vest, shares | 13,333 | ||||
General and Administrative Expense [Member] | |||||
Fair value adjustment of warrants | $ | $ (2,300) | $ (18,100) |
Segment Information (Details Na
Segment Information (Details Narrative) | 12 Months Ended |
Dec. 31, 2016Segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 2 |
Segment Information - Schedule
Segment Information - Schedule of Revenue by Country (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Revenue by country | $ 4,001,300 | $ 4,981,000 |
United States [Member] | ||
Revenue by country | 1,554,800 | 2,267,600 |
Brazil [Member] | ||
Revenue by country | 606,600 | 666,400 |
Other Countries [Member] | ||
Revenue by country | $ 1,839,900 | $ 2,047,000 |