Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2016 | Apr. 29, 2016 | |
Document And Entity Information | ||
Entity Registrant Name | Uni-Pixel | |
Entity Central Index Key | 1,171,012 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 38,771,836 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2,016 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Current assets | ||
Cash and cash equivalents | $ 4,825 | $ 7,618 |
Restricted cash | 4,098 | |
Account receivable, net | $ 727 | 334 |
Inventory | $ 707 | 769 |
Debt issuance costs | 526 | |
Prepaid licenses | $ 4,900 | 4,900 |
Prepaid expenses | 602 | 819 |
Total current assets | 11,761 | 19,064 |
Property and equipment, net | 1,708 | 1,842 |
Other long-term assets | 13 | 13 |
Prepaid licenses, net of current portion | 4,404 | 5,629 |
Total assets | 17,886 | 26,548 |
Current liabilities | ||
Accounts payable | 1,543 | 1,150 |
Accrued liabilities | $ 676 | 780 |
Convertible notes payable | $ 2,773 | |
Short term debt | $ 450 | |
Derivative liability | 869 | $ 491 |
Total current liabilities | 3,538 | 5,194 |
Royalty liability | 948 | 1,175 |
Long term liabilities | $ 584 | 645 |
Long term debt | 450 | |
Total liabilities | $ 5,070 | $ 7,464 |
Commitments and contingencies | ||
Shareholders' equity | ||
Common stock, $0.001 par value; 100,000,000 shares authorized, 36,627,985 shares issued and outstanding at March 31, 2016 and 32,170,778 shares issued and outstanding at December 31, 2015 | $ 37 | $ 32 |
Additional paid-in capital | 170,382 | 168,243 |
Accumulated deficit | (157,603) | (149,191) |
Total shareholders' equity | 12,816 | 19,084 |
Total liabilities and shareholders' equity | $ 17,886 | $ 26,548 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 36,627,985 | 32,170,778 |
Common stock, shares outstanding | 36,627,985 | 32,170,778 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Income Statement [Abstract] | ||
Revenue | $ 850 | $ 7 |
Cost of revenues | 4,250 | $ 7 |
Gross margin | (3,400) | |
Selling, general and administrative expenses | 1,852 | $ 2,966 |
Research and development | 927 | 2,722 |
Operating income (loss) | (6,179) | $ (5,688) |
Other income (expense) | ||
Debt issuance cost amortization expense | (526) | |
Loss on change in warranty liability | (407) | |
Accretion of discount on convertible notes | (1,291) | |
Interest income (expense), net | (10) | $ 4 |
Net loss | $ (8,413) | $ (5,684) |
Per share information | ||
Net loss - basic | $ (0.24) | $ (0.46) |
Net loss - diluted | $ (0.24) | $ (0.46) |
Weighted average number of basic common shares outstanding | 35,797,409 | 12,363,774 |
Weighted average number of diluted common shares outstanding | 35,797,409 | 12,363,774 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Cash flows from operating activities | ||
Net loss | $ (8,413) | $ (5,684) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 1,280 | 1,566 |
Restricted stock issuance | 302 | 387 |
Stock compensation expense | 167 | $ 541 |
Amortization of debt issuance costs | 526 | |
Accretion of discount on convertible note | 1,291 | |
Net increase in fair value of derivatives | 407 | |
Change in operating assets and liabilities: | ||
Increase in accounts receivable | (392) | |
Decrease in inventory | 61 | |
Decrease in prepaid assets and other current assets | 219 | $ 48 |
Increase in accounts payable | 393 | $ 135 |
Decrease in long-term liabilities | (57) | |
Decrease in accrued expenses and other liabilities | (109) | |
Net cash used in operating activities | (4,325) | $ (3,007) |
Cash flows from investing activities | ||
Purchase of property and equipment | (149) | (49) |
Net cash used in investing activities | (149) | $ (49) |
Cash flows from financing activities | ||
Decrease in cash restricted for convertible notes payable | $ 4,098 | |
Proceeds from exercise of stock options, net | $ 75 | |
Payments on note payable | $ (2,417) | |
Net cash provided by financing activities | 1,681 | $ 75 |
Net decrease in cash and cash equivalents | (2,793) | (2,981) |
Cash and cash equivalents, beginning of period | 7,618 | 23,663 |
Cash and cash equivalents, end of period | 4,825 | $ 20,682 |
Supplemental disclosures of cash flow information: | ||
Cash paid for interest | $ 8 | |
Cash paid for income taxes | ||
Supplemental disclosures of non-cash financing information: | ||
Issuance of common stock to convert notes and interest | $ 1,675 |
Basis of Presentation, Business
Basis of Presentation, Business and Organization | 3 Months Ended |
Mar. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation, Business and Organization | Note 1 Basis of Presentation, Business and Organization Uni-Pixel, Inc., a Delaware corporation, is the parent company of Uni-Pixel Displays, Inc., its wholly-owned operating subsidiary. As used herein, Uni-Pixel, the Company, we, us, and our refer to Uni-Pixel, Inc. and Uni-Pixel Displays, Inc. Our common stock, par value $0.001 per share, is quoted on The NASDAQ Capital Market under the ticker symbol UNXL. On April 16, 2015 we acquired certain assets and licenses related to the manufacture of XTouch touch sensors from Atmel Corporation and CIT Technology Ltd. and we closed a private offering consisting of $15 million in principal amount of our Senior Secured Convertible Promissory Notes together with warrants. On April 22, 2015 we terminated the Manufacturing Facility Installation and Supply Agreement dated April 15, 2013 which was entered into by Uni-Pixel Displays, Inc. and Eastman Kodak Company. Our decision to change the focus of our business from developing and manufacturing InTouch sensors to manufacturing and selling XTouch touch sensors was based on, among other things, the pressure of declining prices and margin compression in the touch sensor market. We believe that our purchase of the XTouch technology will provide us with a stand-alone, go-to-market strategy that we expect to provide a better economic model and lead to a scalable business in a more rapid time frame. In addition to the flexible electronic films described above, we are developing a hard coat resin that can be applied using film, spray or inkjet coating methods for applications as protective cover films, a cover lens replacement or a conformal hard coat for plastic components. We plan to sell our hard coat resin and optical films under the Diamond Guard® brand. Our strategy is to further develop our proprietary Performance Engineered Film technology around the vertical markets that we have identified as high growth profitable market opportunities. These markets include touch sensors, antennas, automotive and lighting. As of March 31, 2016, Uni-Pixel had accumulated a total deficit of $157.6 million from operations in pursuit of these objectives. As of March 31, 2016, we had cash and cash equivalents of $4.8 million. Our long-term viability is dependent upon our ability to successfully operate our business, develop our manufacturing process, develop our products, establish the business relationships we need to manufacture and market our products, and raise additional capital through offerings of our debt and equity securities to meet our business objectives. The Company is subject to a number of risks, including, but not limited to, whether it can successfully integrate the XTouch operations; whether the manufacture and sale of the XTouch touch sensors will ultimately prove to be profitable; whether the Company will be able to raise capital when it needs to do so; whether the Company can successfully compete in the industry, particularly against larger organizations with greater financial and other resources; whether the Company will continue to receive the services of its key personnel; whether its intellectual property is adequately protected; and other risks related to the electronics market industry. Basis of Presentation The condensed consolidated financial statements presented in this quarterly report include Uni-Pixel, Inc. and our wholly-owned subsidiary, Uni-Pixel Displays, Inc. All significant intercompany transactions and balances have been eliminated. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 2 Summary of Significant Accounting Policies Interim financial information The condensed consolidated financial statements included herein, which have not been audited pursuant to the rules and regulations of the Securities and Exchange Commission, reflect all adjustments which, in the opinion of management, are necessary for a fair presentation of financial position, results of operations and cash flows for the interim periods on a basis consistent with the annual audited statements. All such adjustments are of a normal recurring nature. The results of operations for interim periods are not necessarily indicative of the results that may be expected for any other interim period or for a full year. Certain information, accounting policies and footnote disclosures normally included in condensed consolidated financial statements prepared in conformity with accounting principles generally accepted in the United States of America have been omitted pursuant to such rules and regulations, although we believe that the disclosures are adequate to make the information presented not misleading. These condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements included in our Form 10-K, for the year ended December 31, 2015, filed with the Securities and Exchange Commission on March 30, 2016. The accounting and reporting policies of the Company conform to U.S. generally accepted accounting principles (GAAP) and to the practices within the technology industry. There have been no significant changes in the Companys significant accounting policies during the three months ended March 31, 2016 compared to what was previously disclosed in the Companys Annual Report on 10-K for the year ended December 31, 2015. The consolidated financial information as of December 31, 2015 included herein has been derived from the Companys audited consolidated financial statements as of, and for the fiscal year ended, December 31, 2015. Significant Accounting Policies Use of estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Examples include provisions for bad debts, useful lives of property and equipment and intangible assets, valuation of derivative liability, impairment of property and equipment and intangible assets, deferred taxes, and the provision for and disclosure of litigation and loss contingencies and stock based compensation. Actual results may differ materially from those estimates. Statement of cash flows For purposes of the statements of cash flows, we consider all highly liquid investments (i.e., investments which, when purchased, have original maturities of three months or less) to be cash equivalents. Concentration of credit risk We maintain our cash with major U.S. domestic banks. The amounts held in interest bearing accounts periodically exceed the Federal Deposit Insurance Corporation (FDIC) insured limit of $250,000 at March 31, 2016 and December 31, 2015. We have not incurred losses related to these deposits. Restricted cash As of March 31, 2016 and December 31, 2015 we had restricted cash of $0 and $4.1 million, respectively. At December 31, 2015 the $4.1 million of restricted cash represents the amount we are required to maintain on our balance sheet in accordance with the terms of the Securities Purchase Agreement we entered into on April 16, 2015 for the sale of our Senior Secured Convertible Promissory Notes. This amount was released from restriction during the three months ended March 31, 2016 upon conversion of the Senior Secured Promissory Notes. Accounts Receivable The carrying value of our accounts receivable, net of allowance for doubtful accounts, represents their estimated net realizable value. We estimate the allowance for doubtful accounts based on type of customer, age of outstanding receivable, historical collection trends, and existing economic conditions. If events or changes in circumstances indicate that a specific receivable balance may be unrealizable, further consideration is given to the collectability of those balances, and the allowance is adjusted accordingly. Receivable balances deemed uncollectible are written off against the allowance. We have $0.7 million and $0.3 million accounts receivable balances at March 31, 2016 and December 31, 2015, respectively. Property and equipment Property and equipment, consisting primarily of production equipment, lab equipment, computer equipment, software, leasehold improvements, and office furniture and fixtures is carried at cost less accumulated depreciation and amortization. Depreciation and amortization for financial reporting purposes is provided by the straight-line method over the estimated useful lives of three to five years. Leasehold improvements are amortized using the straight-line method over the remaining lease term or the life of the asset, whichever is shorter. The cost of repairs and maintenance is charged as an expense as incurred. Gains or losses related to retirements or dispositions of fixed assets are recognized in the period incurred. Convertible debt The Company accounts for its convertible debt as equal to its proceeds, less discounts. The Company records discounts on its convertible debt for the fair value of freestanding and embedded derivatives and beneficial conversion features associated with the issuance of the debt. Discounts are amortized over the life of the convertible debt. The convertible debt is presented on the face of the financial statement as proceeds less the balance of unamortized discounts. Inventory Inventory is stated at the lower of cost or market. Cost is determined using standard cost, which approximates the first-in, first-out method. Adjustments to reduce the carrying value of inventory to its net realizable value are made for estimated excess, obsolete or impaired balances. These adjustments are measured as the excess of the cost of the inventory over its market value based upon assumptions about future demand and charged to cost of revenue. At the point of the loss recognition, a new, lower cost basis for that inventory is established, and subsequent changes in facts and circumstances do not result in the restoration of the original cost basis or increases in the newly established cost basis. Derivative liabilities In accordance with ASC 815-40-25 and ASC 815-10-15 Derivatives and Hedging and ASC 480-10-25 Liabilities-Distinguishing from Equity, the Companys convertible notes are accounted for net, outside of shareholders equity and warrants are accounted for as liabilities at their fair value during periods where the full ratchet anti-dilution provision is in effect. The warrants are accounted for a liability at their fair value at each reporting period. The value of the derivative warrant liability will be re-measured at each reporting period with changes in fair value recorded as earnings. To derive an estimate of the fair value of these warrants, a binomial model is utilized that computes the impact of share dilution upon the exercise of the warrant shares. This process relies upon inputs such as shares outstanding, estimated stock prices, strike price and volatility assumptions to dynamically adjust the payoff of the warrants in the presence of the dilution effect. Revenue recognition We recognize revenue over the period the service is performed. In general, this requires that four basic criteria must be met before revenue can be recognized: (1) persuasive evidence that an arrangement exists, (2) delivery has occurred or services have been rendered, (3) the fee is fixed and determinable, and (4) collectability is reasonably assured. Advance payments are deferred until shipment of product has occurred or the service has been rendered. Revenue from licenses and other up-front fees are recognized on a ratable basis over the term of the respective agreement. Revenue on certain fixed price contracts where we provide research and development services are recognized over the contract term based on achievement of milestones. When the contracts provide for milestone or other interim payments, the Company will recognize revenue under the milestone method. The milestone method requires the Company to deem all milestone payments within each contract as either substantive or non-substantive. That conclusion is determined based upon a thorough review of each contract and the Companys deliverables committed to in each contract. For substantive milestones, the Company concludes that upon achievement of each milestone, the amount of the corresponding defined payments is commensurate with the effort required to achieve such milestone or the value of the delivered item. The payment associated with each milestone relates solely to past performance and is deemed reasonable upon consideration of the deliverables and the payment terms within the contract. For non-substantive milestones, including advance payments, the recognition of such payments are pro-rated to the substantive milestones. In April 2013, we entered into an agreement with Intel Corporation (Intel) (the Capacity License Agreement), whereby we were to receive $10 million of cash proceeds to assist us in increasing our production capacity. Under the terms of the Capacity License Agreement, there were two milestones with related contingent consideration of $5 million for each milestone plus certain commissions as described below. The Capacity License Agreement required us to purchase certain equipment, which we purchased in 2013 and which we consider not a substantive milestone. The Capacity License Agreement required us to have the capability to produce at least 1 million sensor units per month (as defined in the Capacity License Agreement) by April 2014, which we consider a substantive milestone. We received $5 million in May 2013, which is non-refundable and is recorded as deferred revenue in the accompanying consolidated balance sheet at December 31, 2014. As of December 31, 2015 the $5 million is no longer in deferred revenue. Please refer to Note 5. Upon achieving the deliverables of the Capacity License Agreement, we would have paid a commission to Intel of 10% on revenue derived from the sales of InTouch Sensors jointly developed with Kodak made directly to Intel or to those of Intels manufacturing partners that use Intels Preferred Price and Capacity License Agreement (Designated Customers). The commission amount was to be paid until the aggregate commissions paid equaled the commission cap of $18.5 million. The term of the Capacity License Agreement is the later of 3 years or the full payment of the commission cap. If the Company committed a material breach of the license agreement, certain equipment of the Company with an original cost of approximately $10.1 million would be assigned to Intel to make them whole on any remaining amounts due under the commission cap of $18.5 million. In April 2014, we entered into the First Amendment to the Capacity License Agreement with Intel (the Amended Capacity License Agreement). The Amended Capacity License Agreement modified the original Capacity License Agreement terms as follows: 1) the inability of the Company to reach, by April 2014, the minimum production capability and the required quality standards specified in the Capacity License Agreement will no longer constitute a material breach to the Capacity License Agreement; 2) the total amount of cash proceeds to be received was reduced from $10 million to $5 million, which included the $5 million we received in May 2013; 3) the cap on the commission amount was reduced from $18.5 million to $6.25 million; 4) the term commission was defined as 10% of gross revenue from the sale of all InTouch sensors sold by the Company, which includes sales of sensors to all customers including, but not limited to, Intel and its Designated Customers; 5) if the Company becomes the subject of any proceeding under any bankruptcy, insolvency or liquidation law, the Company will assign all title and ownership to certain designated equipment (the Equipment) to Intel; and 6) if the Company materially breaches the Amended Capacity License Agreement, which breach is not cured within 30 days after receipt of notice from Intel, the Company may choose to either (A) pre-pay the cap on the commission to Intel (less the total of all previously paid commissions) or (B) assign all title and ownership to the Equipment to Intel. The only remaining milestone of the Amended Capacity License Agreement was the capability to produce at least 1 million sensors units per month. However, the Capacity License Agreement pertained to the old technology that was jointly developed with Kodak was terminated in April 2015 and the Company has abandoned this technology. The Company recorded a $5 million gain on relief of deferred revenue liability for discontinued operations in the fourth quarter of 2015. Loss per share data Basic loss per share is calculated based on the weighted average common shares outstanding during the period. Diluted earnings per share also gives effect to the dilutive effect of stock options, warrants (calculated based on the treasury stock method), convertible notes and convertible preferred stock. The Company does not present diluted earnings per share for years in which it incurred net losses as the effect is antidilutive. At March 31, 2016, 668,000 restricted shares and options and warrants to purchase 12,992,248 shares of common stock at exercise prices ranging from $0.55 to $38.70 per share were outstanding, and were not included in the computation of diluted earnings per share as their effect would be anti-dilutive. Fair Value of Financial Instruments ASC Topic 820, Fair Value Measurement and Disclosures Level 1 Quoted prices in active markets for identical assets and liabilities; Level 2 Inputs other than level one inputs that are either directly or indirectly observable; and Level 3 Unobservable inputs developed using estimates and assumptions, which are developed by the reporting entity and reflect those assumptions that a market participant would use. Our financial instruments consist of accounts receivable, prepaid expenses, derivative liability and accounts payable. We believe the fair values of our accounts receivable, prepaid expenses and accounts payable reflect their respective carrying amounts given the short term nature of these instruments. The derivative liability is measured at fair value on a recurring basis. Recently issued accounting pronouncements In February 2016, the Financial Accounting Standards Update (ASU) 2016-02 Leases (Topic). This ASU requires a lessee to recognize a right-of-use asset and a lease liability under most operating leases in its balance sheet. For public companies, the ASU is effective for annual and interim periods beginning after December 15, 2018. Early adoption is permitted. The company is currently evaluating the effects that the adoption of ASU 2016-02 will have on the financial position, results of operations or cash flows. Accounting Guidance Not Yet Effective In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers. ASU 2014-09 requires an entity to 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. To achieve this core principle, the guidance provides that an entity should apply the following steps: (1) identify the contract(s) with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when, or as, the entity satisfies a performance obligation. The Company expects to adopt ASU 2014-09 for the fiscal year ending December 31, 2017 and the Company will continue to assess the impact on its financial statements. Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies are not expected to have a material impact on the Companys financial position, results of operations and cash flows. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 3 Commitments and Contingencies Leases The Company entered into a lease for office, warehouse and laboratory facilities for approximately 7,186 square feet at 3400 Research Forest Drive, Suite B2, The Woodlands, Texas 77381 under a third party non-cancelable operating lease through May 31, 2016. In conjunction with the acquisition of the XTouch technology, the Company entered into a lease for office and production facilities for approximately 28,918 square feet at 1150 E. Cheyenne Mountain Boulevard, Colorado Springs, Colorado 80906 under a third party non-cancelable operating lease through October 15, 2016. In July 2015, the company entered into a lease for office space for 4,478 square feet at 4699 Old Ironsides Drive, Ste. 300, Santa Clara, CA 95054 through July 14, 2018 Future minimum lease commitments as of March 31, 2016 are as follows: Year Ending March 31 (in thousands) Nine months ending 2016 $ 151 2017 148 2018 75 2019 2020 2021 Total $ 374 Eco-System Partner Royalty Obligation As discussed in Note 2 above, in April 2013, we entered into a Capacity License Agreement with Intel, whereby we were to receive $10 million of cash proceeds to assist us in increasing our production capacity. Under the terms of the Capacity License Agreement, there were two milestones with related contingent consideration of $5 million for each milestone plus certain commissions as described below. The Capacity License Agreement required us to purchase certain equipment, which we purchased in 2013 and which we consider not a substantive milestone. The Capacity License Agreement required us to have the capability to produce at least 1 million sensor units per month (as defined in the Capacity License Agreement) by April 2014, which we consider a substantive milestone. We received $5 million in May 2013, which is non-refundable and is recorded as deferred revenue in the accompanying consolidated balance sheet at December 31, 2014. As of December 31, 2015 the $5 million is no longer in deferred revenue. Upon achieving the deliverables of the Capacity License Agreement, we would have paid a commission to Intel of 10% on revenue derived from the sales of InTouch Sensors jointly developed with Kodak made directly to Designated Customers. The commission amount was to be paid until the aggregate commissions paid equaled the commission cap of $18.5 million. The term of the Capacity License Agreement is the later of 3 years or the full payment of the commission cap. If the Company committed a material breach of the license agreement, certain equipment of the Company with an original cost of approximately $10.1 million would be assigned to Intel to make them whole on any remaining amounts due under the commission cap of $18.5 million. As discussed in Note 2 above, in April 2014, we entered into the Amended Capacity License Agreement with Intel. The Amended Capacity License Agreement modified the original Capacity License Agreement terms as follows: 1) the inability of the Company to reach, by April 2014, the minimum production capability and the required quality standards specified in the Capacity License Agreement will no longer constitute a material breach to the Capacity License Agreement; 2) the total amount of cash proceeds to be received was reduced from $10 million to $5 million, which included the $5 million we received in May 2013; 3) the cap on the commission amount was reduced from $18.5 million to $6.25 million; 4) the term commission is defined as 10% of gross revenue from the sale of all sensors sold by the Company, which includes sales of InTouch Sensors to all customers including, but not limited to, Intel and its Designated Customers; 5) if the Company becomes the subject of any proceeding under any bankruptcy, insolvency or liquidation law, the Company will assign all title and ownership to the Equipment to Intel; and 6) if the Company materially breaches the Amended Capacity License Agreement, which breach is not cured within 30 days after receipt of notice from Intel, the Company may choose to either (A) pre-pay the cap on the commission to Intel (less the total of all previously paid commissions) or (B) assign all title and ownership to the Equipment to Intel. The only remaining milestone of the Amended Capacity License Agreement is the capability to produce at least 1 million sensors units per month. In the fourth quarter of 2015, the Company recorded a $5.0 million gain on relief of deferred revenue liability for discontinued operations. The $5 million was originally received in 2013 and was related to the technology in the Capacity License Agreement that was based on the InTouch Sensor technology which is no longer used. The InTouch Sensor technology was developed in the partnership with Kodak which was terminated in April 2015. In March 2016, Intel, claiming that the XTouch sensors manufactured using the assets acquired from Atmel are the same as the InTouch Sensors jointly developed by the Company and Kodak that the Company has abandoned and transferred to Kodak, alleged that the Company breached the Amended Capacity License Agreement by not paying commissions to Intel based on the sales of the XTouch sensors which were subsequently developed using assets acquired and licensed from Atmel because Intel claims (and the Company disputes) that the XTouch sensors are somehow the same as the InTouch Class Action Litigation and Settlement In June 2013, two purported class action complaints were filed in the United States District Court, Southern District of New York and the United States District Court, Southern District of Texas against the Company and our former CEO, former CFO, and former Chairman. The Southern District of New York complaint was voluntarily dismissed by plaintiff on July 2, 2013. The surviving complaint, with the caption Fitzpatrick, Charles J. v. Uni-Pixel, Inc., et. al. (Cause No. 4:13-cv-01649), alleged that we and our officers and directors violated the federal securities laws, specifically Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, by making purportedly false and misleading statements concerning our licensing agreements and product development (the Class Action Litigation). The complaint sought unspecified damages on behalf of a purported class of purchasers of our common stock during the period from December 7, 2012 to May 31, 2013. On July 25, 2014, the judge granted in part and denied in part our motion to dismiss the case, significantly limiting the claims remaining in the Class Action Litigation. On August 25, 2014, we filed an answer to the complaint. In November 2014, we entered into a memorandum of understanding to settle the Class Action Litigation. The proposed settlement would result in a payment of $2.35 million in cash to the settlement class, inclusive of fees and expenses. In addition, we agreed to issue $2.15 million in common stock to the settlement class with a range of shares of common stock between 358,333 shares and 430,000 shares, calculated by using the trailing 5 day average stock price from the date of Court approval of the settlement. On April 30, 2015, the Court approved the settlement of the Class Action Litigation on the terms set forth above. As a result, the Company issued 430,000 shares of common stock. The cash payment portion of the settlement of $2.35 million was paid from insurance proceeds. The common stock portion of this settlement, totaling $2.15 million. Shareholder Derivative Litigation On February 19, 2014, a shareholder derivative lawsuit, Jason F. Gerzseny v. Reed J. Killion, et. al., was filed in the 165th Judicial District in Harris County, Texas. On February 21, 2014, another shareholder derivative lawsuit, Luis Lim v. Reed J. Killion, et. al., was also filed in Harris County district court. Both complaints alleged various causes of action against certain of the Companys current and former officers and directors, including claims for breach of fiduciary duty, corporate waste, insider selling, and unjust enrichment. On April 8, 2014, these derivative actions were consolidated into one action, captioned In re Uni-Pixel, Inc., Shareholder Derivative Litigation (Cause No. 2014-08251) (the Shareholder Derivative Litigation), and on September 9, 2014, plaintiff filed an amended consolidated complaint. On April 13, 2015, the Court approved the settlement of the Shareholder Derivative Litigation, which required the payment of $150,000 in cash and the issuance of 20,833 shares of the common stock. The cash payment portion of the settlement was paid from insurance proceeds. The common stock portion of the settlement, totaling $125,000. Securities and Exchange Commission Complaint and Settlement On November 19, 2013, the Company learned that the Fort Worth Regional Office of the United States Securities and Exchange Commission (SEC) issued subpoenas concerning the Companys agreements related to our InTouch Sensors. The Company cooperated fully with the SEC regarding this non-public, fact-finding inquiry, and the U.S. District Court for the Southern District of Texas on March 16, 2016 signed a final judgment on a complaint filed by the SEC pursuant to our consent (the Final Judgment). Without admitting or denying the allegations of the SECs complaint, we consented to the Final Judgment, which permanently enjoins us from violating Sections 10(b) and 13(b)(2)(A) and (B) of the Securities Exchange Act of 1934 (the Exchange Act), Rule 10b-5 of the SEC and Section 17(a) of the Securities Act of 1933. The Final Judgment also permanently enjoins the filing with the SEC any periodic report pursuant to Section 13(a) of the Exchange Act and Rules 13a-1, 13a-11, 13a-13 and 12b-20 of the SEC, which contains any untrue statement of material fact, or which omits to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading, or which fails to comply in any material respect with the requirements of Section 13(a) of the Exchange Act and the rules and regulations thereunder. The Final Judgment also provides for a civil penalty in the amount of $750,000 to be paid in accordance with the following schedule: (1) $20,000, within 14 days of entry of this Final Judgment; (2) $20,000, within 104 days of entry of this Final Judgment; (3) $30,000, within 194 days of entry of this Final Judgment; (4) $45,000, within 284 days of entry of this Final Judgment; (5) $60,000, within 374 days of entry of this Final Judgment; (6) $70,000, within 464 days of entry of this Final Judgment; (7) $80,000, within 554 days of entry of this Final Judgment; (8) $80,000, within 644 days of entry of this Final Judgment; (9) $80,000, within 734 days of entry of this Final Judgment; (10) $85,000, within 824 days of entry of this Final Judgment; (11) $90,000, within 914 days of entry of this Final Judgment; (12) $90,000, within 1004 days of entry of this Final Judgment The $750,000 settlement was recorded in other expense on the consolidated income statement and $115,000 in current liabilities and $635,000 in long-term liabilities in the consolidated balance sheet at December 31, 2015. As of March 31, the settlement is recorded in current liabilities of $155,000 and $575,000 in long-term liabilities. The Company paid $20,000 in March 2016. Two former company executive officers faced related charges in the complaint filed by the SEC. The allegations of the SEC against these former executive officers include that they made more than $2 million in personal profits from selling their own shares of the Companys common stock following disclosures regarding the Companys agreement related to our InTouch Sensors. The Companys Amended and Restated Bylaws contain provisions regarding indemnification and advancement of expenses actually and reasonably incurred by the Companys officers in connection with civil, criminal, administrative or investigative matters provided that such officers acted in good faith and in a manner such officers reasonably believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal action or proceeding, had no reason or cause to believe such officers conduct was unlawful. The advancement of expenses is expressly conditioned upon receipt of an undertaking by the officer to repay all such amounts so advanced in the event that it shall ultimately be determined that the officer is not entitled to be indemnified by the Company. |
Equity, Stock Plan and Warrants
Equity, Stock Plan and Warrants | 3 Months Ended |
Mar. 31, 2016 | |
Stockholders' Equity Note [Abstract] | |
Equity, Stock Plan and Warrants | Note 4 Equity, Stock Plan and Warrants Common Stock During the three months ended March 31, 2016, (1) we issued 57,203 shares of common stock for three employees; During the three months ended March 31, 2015, (1) we issued 12,500 shares of common stock for cash in connection with the exercise of stock options; and (2) issued 27,550 shares of common stock to various directors and officers as stock awards; Restricted Stock Total compensation expense recognized for restricted stock was approximately $0.3 million and $0.4 million for the three months ended March 31, 2016 and March 31, 2015, respectively. The Company has recorded approximately $0.3 million of restricted stock expense in selling, general and administrative expenses and $0 in research and development expense for the three months ended March 31, 2016 and approximately $0.3 million of restricted stock expense in selling, general and administrative expenses and approximately $0.1 million in research and development expense for the three months ended March 31, 2015. At March 31, 2016, there was $1.0 million of total unrecognized compensation cost related to non-vested shares of restricted stock which is expected to be recognized over a weighted-average period of 1.69 years. There were 57,203 shares of restricted stock, net that became vested during the three months ended March 31, 2016. Stock Incentive Plans The Company has adopted four stock incentive plans: the 2005 Stock Incentive Plan, the 2007 Stock Incentive Plan, the 2010 Stock Incentive Plan and the 2011 Stock Incentive Plan (collectively, the Stock Incentive Plans). The Stock Incentive Plans allow for an aggregate of up to 3,766,667 shares of our common stock to be awarded through incentive and non-qualified stock options, stock appreciation rights, restricted stock, performance shares and other types of awards. Our Stock Incentive Plans are administered by our Board of Directors, which has the sole discretion to select participants who will receive the awards and to determine the type, size and terms of each award granted. As of March 31, 2016, there were 469,022 shares available for issuance under the Stock Incentive Plans. The following disclosures provide information regarding the Companys stock-based compensation awards, all of which are classified as equity awards: Total compensation expense recognized for options was approximately $0.2 million and $0.5 million for the three months ended March 31, 2016 and March 31, 2015, respectively. The Company has recorded approximately $0.1 million of stock compensation expense in selling, general and administrative expenses, approximately $0.1 million in research and development expense and approximately $18,000 in cost of goods sold for the three months ended March 31, 2016 and approximately $0.1 million of stock compensation expense in selling, general and administrative expenses and approximately $0.4 million in research and development expense for the three months ended March 31, 2015. A summary of the changes in the total stock options outstanding during the three months ended March 31, 2016 follows: Weighted Average Options Exercise Price Outstanding and expected to vest, at December 31, 2015 1,941,194 $ 6.54 Granted 45,000 $ 0.55 Forfeited or expired (64,306 ) $ 9.82 Exercised $ Outstanding and expected to vest, at March 31, 2016 1,921,888 $ 6.29 Vested and exercisable at March 31, 2016 1,457,900 $ 7.32 The fair value of the Companys options was estimated on the date of grant using the Black-Scholes valuation model with the following weighted-average assumptions: Three Months Ended March 31, 2016 Three Months Ended March 31, 2015 Expected life (years) 5 years 5 years Interest rate 1.21 % 1.31 to 1.57 % Dividend yield Volatility 94.31 % 144.34 to 147.50 % Forfeiture rate Weighted average fair value of options granted $ 0.39 $ 5.00 At March 31, 2016, there was $0.6 million of total unrecognized compensation cost related to non-vested stock option awards which is expected to be recognized over a weighted-average period of 1.68 years. There was an approximate 0.1 million, net, increase in the vested options during the three months ended March 31, 2016. Common Stock Warrants As of March 31, 2016, the Company has 11,070,360 common stock warrants outstanding with a weighted average exercise price of $1.59 per share. Information regarding outstanding warrants as of March 31, 2016 is as follows: Grant date Warrants Outstanding Exercisable Weighted Exercise Price Remaining Life (Years) June 10, 2009 15,796 15,796 $ 7.50 3.18 August 31, 2009 24,934 24,934 $ 7.50 3.18 October 2, 2009 205,000 205,000 $ 5.00 3.58 March 15, 2010 8,337 8,337 $ 7.50 3.75 April 5, 2010 930 930 $ 7.50 3.75 April 16, 2015 (1) 1,151,121 1,151,121 $ 1.50 4.00 November 5, 2015 (1) 38,371 38,371 1.50 4.00 November 30, 2015 (1) 9,625,871 9,625,871 $ 1.50 4.67 Total 11,070,360 11,070,360 (1) The exercise price of the warrants and the number of shares for which the warrants are exercisable are subject to certain adjustments if the Company issues or sells additional shares of common stock or common stock equivalents at a price per share less than the exercise price then in effect, or without consideration. |
Property and Equipment and Inve
Property and Equipment and Inventory | 3 Months Ended |
Mar. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment and Inventory | Note 5 Property and Equipment and Inventory A summary of the components of property and equipment at March 31, 2016 and December 31, 2015 (in thousands) are as follows: Estimated Useful Lives March 31, 2016 December 31, 2015 Production equipment 3 to 5 years $ 1,966 $ 1,966 Research and development equipment 3 to 5 years 3,583 3,572 Leasehold improvements 5 years 23 23 Computer equipment 5 years 98 98 Office equipment 3 to 5 years 20 20 Construction-in-progress 314 176 6,004 5,855 Accumulated depreciation (4,296 ) (4,013 ) Property and equipment, net $ 1,708 $ 1,842 Depreciation and amortization expense of property and equipment for the three months ended March 31, 2016 and March 31, 2015 was approximately $0.3 million and $1.6 million, respectively. A summary of the components of inventory at March 31, 2016 and 2015 (in thousands): 2016 2015 Raw materials $ 471 $ Work-in-progress 183 Finish Goods 53 Inventory $ 707 $ |
Senior Secured Convertible Note
Senior Secured Convertible Notes and Warrants | 3 Months Ended |
Mar. 31, 2016 | |
Debt Disclosure [Abstract] | |
Senior Secured Convertible Notes and Warrants | Note 6 Senior Secured Convertible Notes and Warrants Concurrent with the consummation of the XTouch acquisition, on April 16, 2015 (the Effective Date), and pursuant to a Securities Purchase Agreement, we sold $15 million in Senior Secured Convertible Notes, together with warrants for the purchase of 1,151,121 shares of our common stock (the Warrants), to two accredited investors (the Investors). In addition, we sold an additional $0.5 million Convertible Note to one of these Investors in November 2015, and the Warrant issued to that Investor was adjusted for an additional 38,371 shares of common stock. The number of shares of common stock subject to the Warrants equaled 65% of the number of shares of common stock the Investors would receive if the Convertible Notes were converted at the Conversion Price (as defined below) on the trading day immediately prior to the Effective Date. The Convertible Notes accrue simple interest at the rate of 9% per year (Interest). On November 23, 2015, the Interest was reduced to 4%. The Convertible Notes together with all accrued and unpaid Interest are due and payable on April 16, 2016 (the Maturity Date). The Investors may, at any time, elect to convert the Convertible Notes into shares of our common stock at the conversion price, subject to certain beneficial ownership limitations. The conversion price is the lesser of $8.47 per share (the Conversion Price), subject to adjustment as set forth in the Convertible Notes for stock splits, dividends, recapitalizations and similar events, which equaled 110% of the last closing price of our common stock prior to the execution and delivery of the Securities Purchase Agreement and 85% of the lowest closing sale price during the prior 30 trading day period. Provided there has been no Equity Conditions Failure, as defined in the Convertible Notes, we will pay the Installment Amount, as defined in the Convertible Notes, by converting all or some of the Installment Amount into common stock (a Company Conversion). However, we may also, at our option, pay the Installment Amount by redeeming the Installment Amount in cash (a Company Redemption) or by any combination of a Company Conversion and a Company Redemption. Any Company Conversion occurs at a price which is the lower of the Conversion Price and 85% of the lower of the arithmetic average of the 4 lowest daily weighted average prices of the common stock during the prior 12 consecutive trading days and the closing sale price on the prior day. The Investors have the right to accelerate payment on each monthly redemption date of up to two monthly redemption amounts upon written notice to us, and the Investors have the option to be paid such accelerated amount in common stock as if it were a Company Conversion. The Investors also have the right to defer payment of a monthly redemption amount. Following an Event of Default, as defined in the Convertible Notes, the Investors may require us to redeem all or any portion of the Convertible Notes. The redemption amount may be paid in cash or with shares of our common stock, at the election of the Investor, at a price equal to the Event of Default Redemption Price, as defined in the Convertible Notes. The Warrants when issued had a five-year term and a per share exercise price of $9.63, subject to adjustment as set forth in the Warrants, which equaled 125% of the closing price of our common stock prior to the Effective Date. If, after the Effective Date, we issue or sell, or are deemed to have issued or sold, any shares of common stock (with the exception of certain Excluded Securities, as those are defined in the Warrants) for a consideration per share less than a price equal to the exercise price of the Warrants in effect immediately prior to such issue or sale (or deemed issuance or sale) (a Dilutive Issuance), then immediately after the Dilutive Issuance, (x) if the Dilutive Issuance occurs prior to the one year anniversary of the Effective Date, then the exercise price then in effect will be reduced to an amount equal to the product of (A) the exercise price in effect immediately prior to the Dilutive Issuance and (B) the quotient determined by dividing (1) the sum of (I) the product derived by multiplying the exercise price in effect immediately prior to the Dilutive Issuance and the number of Common Shares Deemed Outstanding (as defined in the Warrants) immediately prior to the Dilutive Issuance plus (II) the consideration, if any, received by us on such Dilutive Issuance, by (2) the product derived by multiplying (I) the exercise price in effect immediately prior to the Dilutive Issuance by (II) the number of Common Shares Deemed Outstanding immediately after the Dilutive Issuance and (y) if the Dilutive Issuance occurs after the one year anniversary of the Effective Date but within five years of the Effective Date, the exercise price then in effect will be reduced to an amount equal to the price of the shares of common stock issued in the Dilutive Issuance. The Warrants will be exercisable for cash, but if a prospectus covering the shares of common stock underlying the Warrants is not available, the Investors may exercise the Warrants using a cashless exercise provision. The Warrants may not be exercised if, after giving effect to the exercise, the Investor would beneficially own in excess of 4.99% or 9.99% of the outstanding shares of common stock, depending on the Investor. At the Investors option, the cap applicable to the exercise of the Warrants may be raised or lowered to any other percentage not in excess of 9.99%, except that any increase will only be effective upon 61-days prior notice to us. As per the terms of the November 2015 equity transaction, the 1,189,492 Warrants were exchanged for new warrants to purchase an equivalent number of shares of common stock in the same form and same terms as the warrants issued in such equity transaction, including a repricing to $1.50 per share exercise price. The exercise price of the Warrants and the number of shares for which the Warrants are exercisable are subject to certain adjustments if the Company issues or sells additional shares of common stock or common stock equivalents at a price per share less than the exercise price then in effect, or without consideration. Notwithstanding the foregoing, there will be no adjustment to the exercise price of the Warrants or number of warrant shares issuable upon exercise in connection with the issuance of common stock upon Board of Director-approved employee benefit plans or upon the conversion, exercise or payment of certain outstanding, excluded securities. Pursuant to a Pledge and Security Agreement (the Security Agreement) we entered into in favor of Hudson Bay Fund LP as Collateral Agent, the Convertible Notes are secured by a perfected first priority security interest in all of our assets and are senior in right of payment to all of our existing and future indebtedness, subject to Permitted Liens, as defined in the Convertible Notes. With the exception of Permitted Liens, we have agreed that we will not grant a security interest in our assets so long as the Convertible Notes remain outstanding and that we will not incur any new debt except for Permitted Indebtedness, as that term is defined in the Convertible Notes. In conjunction with the issuance of the Convertible Notes and the Warrants, we entered into a Registration Rights Agreement pursuant to which we agreed to file a registration statement covering the sum of (i) 200% of the maximum number of shares underlying the Convertible Notes and (ii) the maximum number of shares underlying the Warrants (the Registrable Securities). We have agreed to keep any registration statement we file pursuant to the Registration Rights Agreement effective until the earlier of (i) the date as of which the Investors may sell all of the Registrable Securities covered by the Registration Statement without restriction or limitation pursuant to Rule 144 and without the requirement to be in compliance with Rule 144(c)(1) (or any successor thereto) or (ii) the date on which the Investors shall have sold all of the securities covered by such Registration Statement. We were to use our reasonable best efforts to have the registration statement declared effective within 90 days after the Effective Date (the Registration Statement Effective Date). If we failed to register the Registrable Securities or the registration statement is not declared effective by the SEC before the Registration Statement Effective Date, or if on any day after the Registration Statement Effective Date, sales of the Registrable Securities required to be included on the Registration Statement cannot be made (collectively, a Registration Default), we will pay to each Investor an amount in cash equal to 1% of the aggregate Purchase Price (as that term is defined in the Securities Purchase Agreement) of the Investors Registrable Securities, whether or not the Registrable Securities were included in the registration statement, and 1% per month (or a portion thereof pro rata) that the Registration Default continues to exist. We are not required to make these payment if, when a Registration Default occurs, the Investors can freely sell our common stock pursuant to Rule 144 without restriction or limitation. We filed the registration statement within 90 days and therefore did not have to make any payments to the Investors. Investors in the offering have the right to participate for no less than 35% of any future offering of our equity or equity equivalent securities until the second anniversary of the Effective Date when the Convertible Notes were purchased. We agreed to keep at least $6.0 million of restricted cash on our balance sheet at all times until the Maturity Date or until the outstanding principal amount of the Convertible Notes is less than $6.0 million, at which time the amount of restricted cash we are required to keep on our balance sheet will be adjusted downward, dollar for dollar. As of March 31, 2016 and December 31, 2015, the restricted cash was $0 and $4.1 million, respectively. As additional security for repayment of the Convertible Notes, Uni-Pixel Displays, Inc. entered into to a Guarantee Agreement in favor of the Investors. Cowen and Company, LLC acted as our financial advisor in the acquisition of the assets and as our placement agent in the financing transaction. We paid Cowen and Company, LLC approximately $1.7 million for these services. On April 16, 2015, the Company determined that the Convertible Notes had a carrying amount of $3.1 million. The Company utilized a binomial model in determining the fair market value of the Warrants of $6.0 million. The Company also determined there was a beneficial conversion feature (BCF) as a result of the intrinsic value between the effective exercise price and the market price at the time of conversion of $6.0 million. The BCF was included in additional paid in capital. As a result of the down-round protection on the warrants, they have been accounted for as a derivative liability upon issuance and at December 31, 2015. At inception, the Convertible Notes balance (in thousands) and unamortized discount in millions were as follows: Convertible notes $ 15,000 Discount attributable to warrants (5,980 ) Discount attributable to BCF (5,970 ) Carrying amount of Convertible Notes at inception $ 3,050 As of March 31, 2016, both Investors had been issued an aggregate of 13,984,411 shares of common stock when the Investor had converted as of such date $11.6 million of principal and $0.3 million of interest into shares of common stock. The following table summarizes the charges to interest, amortization and other expense, net for the three months ended March 31, 2016 (in thousands): Interest expense on convertible notes $ 8 Accretion of convertible note discount $ 1,291 As of February 16, 2016, the Convertible Note had been fully repaid. |
Agreements with Atmel Corporati
Agreements with Atmel Corporation and CIT Technology LTD. | 3 Months Ended |
Mar. 31, 2016 | |
Business Combinations [Abstract] | |
Agreements with Atmel Corporation and CIT Technology LTD. | Note 7 Agreements with Atmel Corporation and CIT Technology LTD. Atmel Corporation Asset Acquisition and License Agreements On April 16, 2015 (the Effective Date), Uni-Pixel Displays, Inc. (Displays) acquired from Atmel Corporation (Atmel), pursuant to the terms of a Purchase and Sale Agreement, a Patent License Agreement, an IP License Agreement, a Bill of Sale and Assignment and Assumption Agreement and two leases for real property, certain assets used for the production of capacitive touch sensors comprised of fine lines of copper metal photo lithographically patterned and plated on flexible plastic film (the Touch Sensors). $450,000 was paid for the machinery, parts and equipment needed to manufacture the Touch Sensors and the existing inventory on hand. Displays paid this amount with a secured promissory note due on or before the earlier of (i) the second anniversary of the Effective Date or (ii) the sale of equity and/or debt securities after the Effective Date pursuant to which Displays or any affiliate of our receives gross proceeds of no less than $5 million. Interest accrues on the unpaid principal amount at a rate equal to 2% per annum compounded semi-annually and is to be paid in arrears semi-annually, commencing with the six-month anniversary of the Effective Date. Displays has granted to Atmel a security interest in the purchased assets and all accounts receivable subsequently arising from Displays manufacture and sale of Touch Sensors and all proceeds therefrom. Pursuant to the Purchase and Sale Agreement, Displays assumed certain liabilities of Atmel, including open purchase and supply orders, related to the Touch Sensor business. In April 2016, the $450,000 promissory note was fully repaid. Through the Patent License Agreement, Atmel licensed to Displays a non-sublicensable, worldwide, royalty-bearing license under its Touch Sensors patents to make or have made, use, offer for sale, sell, and import the Touch Sensors. In consideration for this license, Displays agreed to pay an annual royalty fee during the initial five year term of the license (the Initial Term) of the greater of $3.25 million or 3.33% of the total net sales (as defined in the Patent License Agreement) of the Touch Sensors during the Initial Term. Displays has the right to renew the license for a term of 10 years. If Displays exercises this right, the annual royalty fee will consist of 2.5% of the total net sales of the Touch Sensors until it reaches a total of $16.75 million, at which time no further annual royalty fees will be due. Upon execution of the Patent License Agreement, Displays paid a non-refundable, non-returnable prepayment of minimum annual royalty fees of $9.33 million (the Royalty Prepayment). The Royalty Prepayment will be applied to the annual royalty fees Displays owes under the Patent License Agreement. If, during the Initial Term, Displays cash balances as of the quarter end immediately prior to the date of the royalty period to which an unpaid annual royalty relates is less than $30 million, it may pay the annual royalty fee with a secured promissory note. Atmel has agreed that it will not enter into a license agreement for the licensed patents that is effective prior to the second anniversary of the Effective Date. Through the IP License Agreement, Atmel licensed to Displays a non-sublicensable, worldwide, royalty-free license to the intellectual property necessary to make or have made, use, offer for sale, sell, and import the Touch Sensors. The term of the IP License Agreement is co-extensive with the term of the Patent License Agreement. Atmel has agreed that it will not enter into a license agreement for the licensed intellectual property that is effective prior to the second anniversary of the Effective Date. As part of the asset acquisition, Displays also entered into leases with Atmel Corporation for Building 2 and Building 4, both of which are located at 1150 E. Cheyenne Mountain Boulevard, Colorado Springs, Colorado. The term of each lease is 18 months (the Primary Lease Term). The term of each lease may be extended for two additional six month periods. During the Primary Lease Term, the initial base rent for each of Building 2 and Building 4 will be $100 per month. During the first renewal term, the monthly base rent for Building 2 will be $5,625 and during the second renewal term the monthly base rent will be $8,437. During the first renewal term, the monthly base rent for Building 4 will be $39,375 and during the second renewal term the monthly base rent will be $59,062. Aside from the base rent, Displays is responsible for the payment of its share of operating expenses attributable to the buildings, real estate taxes attributable to the buildings, sales and personal property taxes, utilities and additional services provided by Atmel (as defined in the leases). Transition Services Agreement In conjunction with the above-described transaction, Displays and Atmel entered into a Transition Services Agreement. Pursuant to the Transition Services Agreement, Atmel agreed to provide the following services for the periods described: (i) quality assurance and failure analysis services for the XTouch Touch Sensors for a period of six months starting from the Effective Date, (ii) operations services for a period of 30 days starting from the Effective Date and (iii) other services, as those are defined in the Transition Services Agreement, for a period of three months starting from the Effective Date. In exchange for the services, Displays has agreed to pay reasonable and documented direct costs incurred by Atmel in performing the services together with actual out-of-pocket third-party expenses reasonably incurred by Atmel in providing the services. The service fees include, but are not limited to, (a) the actual out-of-pocket employment costs (base salary, payroll taxes and out-of-pocket medical benefits) for the individuals performing the services (based on the actual time expended by such individuals in performing the services), (b) costs of materials, (c) the actual out-of-pocket third-party expenses reasonably incurred by Atmel in providing the services, and (d) direct supervisory and management expenses incurred by Atmel in providing the services. On the Effective Date, we paid $0.4 million to Atmel and was applied against certain designated services. The transition services have been completed. CIT Technology Ltd. License Agreements and Manufacturing and Technology Transfer Agreement On the Effective Date Displays entered into an FLT (Fine Line Technology) Patent License Agreement (the CIT Patent License Agreement), an FLT (Fine Line Technology) Intellectual Property License Agreement (the CIT IP License Agreement) and a Manufacturing and Technology Transfer Agreement (the Manufacturing Agreement) with CIT Technology Ltd. (CIT). Through the CIT Patent License Agreement, CIT licensed to Displays a non-sublicensable, worldwide, royalty-bearing license under its fine line technology (FLT) patents to make or have made, use, offer for sale, sell, and import licensed FLT products (the Licensed Products), which are defined as capacitive touch sensors comprising fine lines of copper metal printed on flexible plastic film. In consideration for this license, Displays agreed to pay an annual royalty fee during the initial five year term of the license (the Initial License Term) of the greater of $1.65 million or 1.67% of the total net sales (as defined in the CIT Patent License Agreement) of the Licensed Products during the Initial License Term. Displays has the right to renew the license for a term of 10 years. If Displays exercises this right, the annual royalty fee will consist of 1.67% of the total net sales of the Licensed Products until it reaches a total of $8.25 million, at which time no further annual royalty fees will be due. Further, the total royalty fees payable for the initial 5 year term and the subsequent 10 year term is capped at $30 million. Upon execution of the CIT Patent License Agreement, Displays paid a non-refundable, non-returnable prepayment of minimum annual royalty fees of $4.67 million (the CIT Royalty Prepayment). The CIT Royalty Prepayment will be applied to the annual royalty fees Displays owes under the CIT Patent License Agreement. If, during the Initial License Term, Displays cash balances as of the quarter end immediately prior to the date of the royalty period to which an unpaid annual royalty relates is less than $30 million, Displays may pay the annual royalty fee with a secured promissory note. CIT has agreed that it will not enter into a license agreement for the licensed patents as they relate to the Licensed Products that is effective prior to the second anniversary of the Effective Date. Through the CIT IP License Agreement, CIT licensed to Displays a non-sublicensable, worldwide, royalty-free license to the intellectual property necessary to make or have made, use, offer for sale, sell, and import the Licensed Products. The term of the CIT IP License Agreement is co-extensive with the term of the CIT Patent License Agreement. CIT has agreed that it will not enter into a license agreement for the licensed intellectual property as it relates to the Licensed Products that is effective prior to the second anniversary of the Effective Date. The Manufacturing Agreement had a term of six months, where Displays agreed that for a period of 16 consecutive weeks it will order, on a weekly basis, 11,500 linear meters of coated film manufactured by CIT at a cost of $7.90 per linear meter. The agreement had been completed and the process was transferred to the Colorado Springs facility in fiscal year 2015. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 8 Fair Value Measurements Liabilities measured at fair value (in thousands) on a recurring basis are summarized as follows: Carrying Fair Value Measurements Using Inputs Amount at Financial Instruments Level 1 Level 2 Level 3 March 31, 2016 Liabilities: Derivative liability $ - $ 869 $ - $ 869 Total $ - $ 869 $ - $ 869 As described in Note 6, the derivative liability is related to warrants to purchase 1,151,121 shares of common stock issued by the Company in connection with our Convertible Note of $15.0 million in April 2015, which included a down-round protection on the warrants. The original exercise price of these warrants were $9.63 per share and they expire in April 2020. With the additional $0.5 million in Convertible Note issued in November 2015, the original Warrant was adjusted for an additional 38,371 shares of common stock. In connection with the November 2015 equity transaction (Note 6), the total outstanding warrants for 1,189,492 warrants were repriced to $1.50 per share. These warrants were not issued with the intent of effectively hedging any future cash flow, fair value of any asset, liability or any net investment in a foreign operation. The fair value of these warrants were $6.0 million at inception as described in Note 6. The Company recognized $0.4 million of other expense in the three months ended March 31, 2016 in the accompanying consolidated statements of operations, resulting from the increase in the fair value of the derivative liability at March 31, 2016. The derivative liability will be measured at fair value, with changes in fair value recognized in earnings, until the warrants are exercised, expire or are otherwise extinguished. |
Revenue and Credit Concentratio
Revenue and Credit Concentrations | 3 Months Ended |
Mar. 31, 2016 | |
Risks and Uncertainties [Abstract] | |
Revenue and Credit Concentrations | Note 9 Revenue and Credit Concentrations The Company operates in one business segment and uses one measurement of profitability for its business. During the three months ended March 31, 2016 and 2015, revenues by customers (in thousands) with more than 10% of revenue were as follows: As of March 31, 2016 As of March 31, 2015 Amount % Amount % Company A $ 460 54 % $ - - % Company B 357 42 % - - % Company C - - % 7 100 % Total $ 817 96 % $ 7 100 % As of March 31, 2016 and December 31, 2015 customers with more than 10% of accounts receivables balances (in thousands) were as follows: As of March 31, 2016 As of March 31, 2015 Amount % Amount % Company A $ 387 53 % $ - - % Company B 308 42 % - - Total $ 695 95 % $ - - % |
Subsequent Event
Subsequent Event | 3 Months Ended |
Mar. 31, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Event | Note 10 Subsequent Event The Company paid $450,000 plus interest to Atmel in April 2016. The promissory note has been fully repaid. In April 2016, the company received $2,242,500 cash proceeds in connection with warrant exercises. |
Summary of Significant Accoun16
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Examples include provisions for bad debts, useful lives of property and equipment and intangible assets, valuation of derivative liability, impairment of property and equipment and intangible assets, deferred taxes, and the provision for and disclosure of litigation and loss contingencies and stock based compensation. Actual results may differ materially from those estimates. |
Statement of Cash Flows | Statement of cash flows For purposes of the statements of cash flows, we consider all highly liquid investments (i.e., investments which, when purchased, have original maturities of three months or less) to be cash equivalents. |
Concentration of Credit Risk | Concentration of credit risk We maintain our cash with major U.S. domestic banks. The amounts held in interest bearing accounts periodically exceed the Federal Deposit Insurance Corporation (FDIC) insured limit of $250,000 at March 31, 2016 and December 31, 2015. We have not incurred losses related to these deposits. |
Restricted Cash | Restricted cash As of March 31, 2016 and December 31, 2015 we had restricted cash of $0 and $4.1 million, respectively. At December 31, 2015 the $4.1 million of restricted cash represents the amount we are required to maintain on our balance sheet in accordance with the terms of the Securities Purchase Agreement we entered into on April 16, 2015 for the sale of our Senior Secured Convertible Promissory Notes. This amount was released from restriction during the three months ended March 31, 2016 upon conversion of the Senior Secured Promissory Notes. |
Accounts Receivable | Accounts Receivable The carrying value of our accounts receivable, net of allowance for doubtful accounts, represents their estimated net realizable value. We estimate the allowance for doubtful accounts based on type of customer, age of outstanding receivable, historical collection trends, and existing economic conditions. If events or changes in circumstances indicate that a specific receivable balance may be unrealizable, further consideration is given to the collectability of those balances, and the allowance is adjusted accordingly. Receivable balances deemed uncollectible are written off against the allowance. We have $0.7 million and $0.3 million accounts receivable balances at March 31, 2016 and December 31, 2015, respectively. |
Property and Equipment | Property and equipment Property and equipment, consisting primarily of production equipment, lab equipment, computer equipment, software, leasehold improvements, and office furniture and fixtures is carried at cost less accumulated depreciation and amortization. Depreciation and amortization for financial reporting purposes is provided by the straight-line method over the estimated useful lives of three to five years. Leasehold improvements are amortized using the straight-line method over the remaining lease term or the life of the asset, whichever is shorter. The cost of repairs and maintenance is charged as an expense as incurred. Gains or losses related to retirements or dispositions of fixed assets are recognized in the period incurred. |
Convertible Debt | Convertible debt The Company accounts for its convertible debt as equal to its proceeds, less discounts. The Company records discounts on its convertible debt for the fair value of freestanding and embedded derivatives and beneficial conversion features associated with the issuance of the debt. Discounts are amortized over the life of the convertible debt. The convertible debt is presented on the face of the financial statement as proceeds less the balance of unamortized discounts. |
Inventory | Inventory Inventory is stated at the lower of cost or market. Cost is determined using standard cost, which approximates the first-in, first-out method. Adjustments to reduce the carrying value of inventory to its net realizable value are made for estimated excess, obsolete or impaired balances. These adjustments are measured as the excess of the cost of the inventory over its market value based upon assumptions about future demand and charged to cost of revenue. At the point of the loss recognition, a new, lower cost basis for that inventory is established, and subsequent changes in facts and circumstances do not result in the restoration of the original cost basis or increases in the newly established cost basis. |
Derivative Liabilities | Derivative liabilities In accordance with ASC 815-40-25 and ASC 815-10-15 Derivatives and Hedging and ASC 480-10-25 Liabilities-Distinguishing from Equity, the Companys convertible notes are accounted for net, outside of shareholders equity and warrants are accounted for as liabilities at their fair value during periods where the full ratchet anti-dilution provision is in effect. The warrants are accounted for a liability at their fair value at each reporting period. The value of the derivative warrant liability will be re-measured at each reporting period with changes in fair value recorded as earnings. To derive an estimate of the fair value of these warrants, a binomial model is utilized that computes the impact of share dilution upon the exercise of the warrant shares. This process relies upon inputs such as shares outstanding, estimated stock prices, strike price and volatility assumptions to dynamically adjust the payoff of the warrants in the presence of the dilution effect. |
Revenue Recognition | Revenue recognition We recognize revenue over the period the service is performed. In general, this requires that four basic criteria must be met before revenue can be recognized: (1) persuasive evidence that an arrangement exists, (2) delivery has occurred or services have been rendered, (3) the fee is fixed and determinable, and (4) collectability is reasonably assured. Advance payments are deferred until shipment of product has occurred or the service has been rendered. Revenue from licenses and other up-front fees are recognized on a ratable basis over the term of the respective agreement. Revenue on certain fixed price contracts where we provide research and development services are recognized over the contract term based on achievement of milestones. When the contracts provide for milestone or other interim payments, the Company will recognize revenue under the milestone method. The milestone method requires the Company to deem all milestone payments within each contract as either substantive or non-substantive. That conclusion is determined based upon a thorough review of each contract and the Companys deliverables committed to in each contract. For substantive milestones, the Company concludes that upon achievement of each milestone, the amount of the corresponding defined payments is commensurate with the effort required to achieve such milestone or the value of the delivered item. The payment associated with each milestone relates solely to past performance and is deemed reasonable upon consideration of the deliverables and the payment terms within the contract. For non-substantive milestones, including advance payments, the recognition of such payments are pro-rated to the substantive milestones. In April 2013, we entered into an agreement with Intel Corporation (Intel) (the Capacity License Agreement), whereby we were to receive $10 million of cash proceeds to assist us in increasing our production capacity. Under the terms of the Capacity License Agreement, there were two milestones with related contingent consideration of $5 million for each milestone plus certain commissions as described below. The Capacity License Agreement required us to purchase certain equipment, which we purchased in 2013 and which we consider not a substantive milestone. The Capacity License Agreement required us to have the capability to produce at least 1 million sensor units per month (as defined in the Capacity License Agreement) by April 2014, which we consider a substantive milestone. We received $5 million in May 2013, which is non-refundable and is recorded as deferred revenue in the accompanying consolidated balance sheet at December 31, 2014. As of December 31, 2015 the $5 million is no longer in deferred revenue. Please refer to Note 5. Upon achieving the deliverables of the Capacity License Agreement, we would have paid a commission to Intel of 10% on revenue derived from the sales of InTouch Sensors jointly developed with Kodak made directly to Intel or to those of Intels manufacturing partners that use Intels Preferred Price and Capacity License Agreement (Designated Customers). The commission amount was to be paid until the aggregate commissions paid equaled the commission cap of $18.5 million. The term of the Capacity License Agreement is the later of 3 years or the full payment of the commission cap. If the Company committed a material breach of the license agreement, certain equipment of the Company with an original cost of approximately $10.1 million would be assigned to Intel to make them whole on any remaining amounts due under the commission cap of $18.5 million. In April 2014, we entered into the First Amendment to the Capacity License Agreement with Intel (the Amended Capacity License Agreement). The Amended Capacity License Agreement modified the original Capacity License Agreement terms as follows: 1) the inability of the Company to reach, by April 2014, the minimum production capability and the required quality standards specified in the Capacity License Agreement will no longer constitute a material breach to the Capacity License Agreement; 2) the total amount of cash proceeds to be received was reduced from $10 million to $5 million, which included the $5 million we received in May 2013; 3) the cap on the commission amount was reduced from $18.5 million to $6.25 million; 4) the term commission was defined as 10% of gross revenue from the sale of all InTouch sensors sold by the Company, which includes sales of sensors to all customers including, but not limited to, Intel and its Designated Customers; 5) if the Company becomes the subject of any proceeding under any bankruptcy, insolvency or liquidation law, the Company will assign all title and ownership to certain designated equipment (the Equipment) to Intel; and 6) if the Company materially breaches the Amended Capacity License Agreement, which breach is not cured within 30 days after receipt of notice from Intel, the Company may choose to either (A) pre-pay the cap on the commission to Intel (less the total of all previously paid commissions) or (B) assign all title and ownership to the Equipment to Intel. The only remaining milestone of the Amended Capacity License Agreement was the capability to produce at least 1 million sensors units per month. However, the Capacity License Agreement pertained to the old technology that was jointly developed with Kodak was terminated in April 2015 and the Company has abandoned this technology. The Company recorded a $5 million gain on relief of deferred revenue liability for discontinued operations in the fourth quarter of 2015. |
Loss Per Share Data | Loss per share data Basic loss per share is calculated based on the weighted average common shares outstanding during the period. Diluted earnings per share also gives effect to the dilutive effect of stock options, warrants (calculated based on the treasury stock method), convertible notes and convertible preferred stock. The Company does not present diluted earnings per share for years in which it incurred net losses as the effect is antidilutive. At March 31, 2016, 668,000 restricted shares and options and warrants to purchase 12,992,248 shares of common stock at exercise prices ranging from $0.55 to $38.70 per share were outstanding, and were not included in the computation of diluted earnings per share as their effect would be anti-dilutive. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments ASC Topic 820, Fair Value Measurement and Disclosures Level 1 Quoted prices in active markets for identical assets and liabilities; Level 2 Inputs other than level one inputs that are either directly or indirectly observable; and Level 3 Unobservable inputs developed using estimates and assumptions, which are developed by the reporting entity and reflect those assumptions that a market participant would use. Our financial instruments consist of accounts receivable, prepaid expenses, derivative liability and accounts payable. We believe the fair values of our accounts receivable, prepaid expenses and accounts payable reflect their respective carrying amounts given the short term nature of these instruments. The derivative liability is measured at fair value on a recurring basis. |
Recently Issued Accounting Pronouncements | Recently issued accounting pronouncements In February 2016, the Financial Accounting Standards Update (ASU) 2016-02 Leases (Topic). This ASU requires a lessee to recognize a right-of-use asset and a lease liability under most operating leases in its balance sheet. For public companies, the ASU is effective for annual and interim periods beginning after December 15, 2018. Early adoption is permitted. The company is currently evaluating the effects that the adoption of ASU 2016-02 will have on the financial position, results of operations or cash flows. |
Accounting Guidance Not Yet Effective | Accounting Guidance Not Yet Effective In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers. ASU 2014-09 requires an entity to 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. To achieve this core principle, the guidance provides that an entity should apply the following steps: (1) identify the contract(s) with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when, or as, the entity satisfies a performance obligation. The Company expects to adopt ASU 2014-09 for the fiscal year ending December 31, 2017 and the Company will continue to assess the impact on its financial statements. Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies are not expected to have a material impact on the Companys financial position, results of operations and cash flows. |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases | Future minimum lease commitments as of March 31, 2016 are as follows: Year Ending March 31 (in thousands) Nine months ending 2016 $ 151 2017 148 2018 75 2019 2020 2021 Total $ 374 |
Equity, Stock Plan and Warran18
Equity, Stock Plan and Warrants (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Stockholders' Equity Note [Abstract] | |
Summary of Changes in Stock Options Outstanding | A summary of the changes in the total stock options outstanding during the three months ended March 31, 2016 follows: Weighted Average Options Exercise Price Outstanding and expected to vest, at December 31, 2015 1,941,194 $ 6.54 Granted 45,000 $ 0.55 Forfeited or expired (64,306 ) $ 9.82 Exercised $ Outstanding and expected to vest, at March 31, 2016 1,921,888 $ 6.29 Vested and exercisable at March 31, 2016 1,457,900 $ 7.32 |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | The fair value of the Companys options was estimated on the date of grant using the Black-Scholes valuation model with the following weighted-average assumptions: Three Months Ended March 31, 2016 Three Months Ended March 31, 2015 Expected life (years) 5 years 5 years Interest rate 1.21 % 1.31 to 1.57 % Dividend yield Volatility 94.31 % 144.34 to 147.50 % Forfeiture rate Weighted average fair value of options granted $ 0.39 $ 5.00 |
Schedule of Outstanding Warrants | Information regarding outstanding warrants as of March 31, 2016 is as follows: Grant date Warrants Outstanding Exercisable Weighted Exercise Price Remaining Life (Years) June 10, 2009 15,796 15,796 $ 7.50 3.18 August 31, 2009 24,934 24,934 $ 7.50 3.18 October 2, 2009 205,000 205,000 $ 5.00 3.58 March 15, 2010 8,337 8,337 $ 7.50 3.75 April 5, 2010 930 930 $ 7.50 3.75 April 16, 2015 (1) 1,151,121 1,151,121 $ 1.50 4.00 November 5, 2015 (1) 38,371 38,371 1.50 4.00 November 30, 2015 (1) 9,625,871 9,625,871 $ 1.50 4.67 Total 11,070,360 11,070,360 (1) The exercise price of the warrants and the number of shares for which the warrants are exercisable are subject to certain adjustments if the Company issues or sells additional shares of common stock or common stock equivalents at a price per share less than the exercise price then in effect, or without consideration. |
Property and Equipment and In19
Property and Equipment and Inventory (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | A summary of the components of property and equipment at March 31, 2016 and December 31, 2015 (in thousands) are as follows: Estimated Useful Lives March 31, 2016 December 31, 2015 Production equipment 3 to 5 years $ 1,966 $ 1,966 Research and development equipment 3 to 5 years 3,583 3,572 Leasehold improvements 5 years 23 23 Computer equipment 5 years 98 98 Office equipment 3 to 5 years 20 20 Construction-in-progress 314 176 6,004 5,855 Accumulated depreciation (4,296 ) (4,013 ) Property and equipment, net $ 1,708 $ 1,842 |
Schedule of Inventory | A summary of the components of inventory at March 31, 2016 and 2015 (in thousands): 2016 2015 Raw materials $ 471 $ Work-in-progress 183 Finish Goods 53 |
Senior Secured Convertible No20
Senior Secured Convertible Notes and Warrants (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Debt Disclosure [Abstract] | |
Schedule of Convertible Debt | At inception, the Convertible Notes balance (in thousands) and unamortized discount in millions were as follows: Convertible notes $ 15,000 Discount attributable to warrants (5,980 ) Discount attributable to BCF (5,970 ) Carrying amount of Convertible Notes at inception $ 3,050 |
Schedule of Debt | The following table summarizes the charges to interest, amortization and other expense, net for the three months ended March 31, 2016 (in thousands): Interest expense on convertible notes $ 8 Accretion of convertible note discount $ 1,291 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value, Liabilities Measured on Recurring Basis | Liabilities measured at fair value (in thousands) on a recurring basis are summarized as follows: Carrying Fair Value Measurements Using Inputs Amount at Financial Instruments Level 1 Level 2 Level 3 March 31, 2016 Liabilities: Derivative liability $ - $ 869 $ - $ 869 Total $ - $ 869 $ - $ 869 |
Revenue and Credit Concentrat22
Revenue and Credit Concentrations (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Risks and Uncertainties [Abstract] | |
Schedules of Credit Concentration Risk | During the three months ended March 31, 2016 and 2015, revenues by customers (in thousands) with more than 10% of revenue were as follows: As of March 31, 2016 As of March 31, 2015 Amount % Amount % Company A $ 460 54 % $ - - % Company B 357 42 % - - % Company C - - % 7 100 % Total $ 817 96 % $ 7 100 % As of March 31, 2016 and December 31, 2015 customers with more than 10% of accounts receivables balances (in thousands) were as follows: As of March 31, 2016 As of March 31, 2015 Amount % Amount % Company A $ 387 53 % $ - - % Company B 308 42 % - - Total $ 695 95 % $ - - % |
Basis of Presentation, Busine23
Basis of Presentation, Business and Organization (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 | Nov. 30, 2015 | Apr. 16, 2015 | Mar. 31, 2015 | Dec. 31, 2014 |
Note 1 - Basis of Presentation, Business and Organization (Details) [Line Items] | ||||||
Common stock, par value | $ 0.001 | $ 0.001 | ||||
Debt principal amount | $ 15,000 | $ 500 | $ 15,000 | |||
Accumulated deficit | 157,603 | $ 149,191 | ||||
Cash and cash equivalents | $ 4,825 | $ 7,618 | $ 20,682 | $ 23,663 | ||
Atmel Corporation X Touch [Member] | Convertible Debt [Member] | ||||||
Note 1 - Basis of Presentation, Business and Organization (Details) [Line Items] | ||||||
Debt principal amount | $ 500 | $ 15,000 |
Summary of Significant Accoun24
Summary of Significant Accounting Policies (Details Narrative) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | ||||
Apr. 30, 2014USD ($)Sensor | May. 31, 2013USD ($) | Apr. 30, 2013USD ($)Sensor | Mar. 31, 2016USD ($)$ / sharesshares | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Note 2 - Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Cash, FDIC insured amount | $ 250 | $ 250 | ||||
Restricted cash | 4,098 | |||||
Accounts receivable, net | $ 727 | 334 | ||||
Deferred revenue, current | $ 5,000 | |||||
Restricted Stock [Member] | ||||||
Note 2 - Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Antidilutive securities | shares | 668,000 | |||||
Stock Option [Member] | ||||||
Note 2 - Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Antidilutive securities | shares | 668,000 | |||||
Warrant [Member] | ||||||
Note 2 - Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Antidilutive securities | shares | 12,992,248 | |||||
Capacity License Agreement [Member] | Intel Corporation [Member] | ||||||
Note 2 - Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Proceeds to received in increase production | $ 10,000 | |||||
Revenue milestones with related contingent consideration | $ 5,000 | |||||
Number of units produced, capability requirement | Sensor | 1,000,000 | |||||
Deferred revenue, current | $ 5,000 | |||||
Commisson, percentage | 10.00% | |||||
Fees and commissions | $ 18,500 | |||||
Revenue agreement, term | 3 years | |||||
Payments to acquire machinery and equipment | $ 10,100 | |||||
Amended Capacity License Agreement [Member] | Intel Corporation [Member] | ||||||
Note 2 - Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Commisson, percentage | 10.00% | |||||
Cash proceeds from license | $ 5,000 | |||||
Gain on relief of deferred revenue liability for discontinued operations | $ 5,000 | |||||
Minimum [Member] | ||||||
Note 2 - Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Property, plant and equipment, useful life | 3 years | |||||
Minimum [Member] | Options And Warrants [Member] | ||||||
Note 2 - Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Antidilutive securities price per share | $ / shares | $ 0.55 | |||||
Minimum [Member] | Capacity License Agreement [Member] | Intel Corporation [Member] | ||||||
Note 2 - Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Number of units produced, capability requirement | Sensor | 1,000,000 | |||||
Minimum [Member] | Amended Capacity License Agreement [Member] | Intel Corporation [Member] | ||||||
Note 2 - Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Number of units produced, capability requirement | Sensor | 1,000,000 | |||||
Fees and commissions | $ 6,250 | |||||
Cash proceeds from license | 5,000 | |||||
Maximum [Member] | ||||||
Note 2 - Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Property, plant and equipment, useful life | 5 years | |||||
Maximum [Member] | Options And Warrants [Member] | ||||||
Note 2 - Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Antidilutive securities price per share | $ / shares | $ 38.70 | |||||
Maximum [Member] | Capacity License Agreement [Member] | Intel Corporation [Member] | ||||||
Note 2 - Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Fees and commissions | $ 18,500 | |||||
Maximum [Member] | Amended Capacity License Agreement [Member] | Intel Corporation [Member] | ||||||
Note 2 - Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Fees and commissions | 18,500 | |||||
Cash proceeds from license | $ 10,000 |
Commitments and Contingencies25
Commitments and Contingencies (Details Narrative) $ in Thousands | Apr. 13, 2015USD ($)shares | Nov. 19, 2013USD ($) | Jul. 31, 2015ft² | Apr. 30, 2015USD ($)shares | Nov. 30, 2014USD ($)shares | Apr. 30, 2014USD ($)Sensor | May. 31, 2013USD ($) | Apr. 30, 2013USD ($)Sensor | Mar. 31, 2016USD ($)ft² | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) |
Deferred revenue | $ 5,000 | ||||||||||
Other liabilities, noncurrent | $ 948 | $ 1,175 | |||||||||
Shareholder Derivative Litigation [Member] | Settlement Stock Portion [Member] | |||||||||||
Litigation settlement, amount | $ 150 | ||||||||||
Number of common stock issued for class action litigation and settlement | $ 125 | ||||||||||
Number of common stock shares issued for class action litigation and settlement | shares | 20,833 | ||||||||||
Final Judgment [Member] | |||||||||||
Litigation settlement, amount | $ 750 | 20 | |||||||||
Other liabilities | 750 | ||||||||||
Other liabilities, current | 155 | 115 | |||||||||
Other liabilities, noncurrent | $ 575 | 635 | |||||||||
Class Action Litigation [Member] | Settled Litigation [Member] | Settlement Stock Portion [Member] | |||||||||||
Litigation settlement, amount | $ 2,350 | $ 2,350 | |||||||||
Number of common stock issued for class action litigation and settlement | $ 2,150 | ||||||||||
Number of common stock shares issued for class action litigation and settlement | shares | 430,000 | ||||||||||
Class Action Litigation [Member] | Pending Litigation [Member] | Settlement Stock Portion [Member] | |||||||||||
Number of common stock issued for class action litigation and settlement | $ 2,150 | ||||||||||
Within 14 Days [Member] | Final Judgment [Member] | |||||||||||
Litigation settlement, amount | 20 | ||||||||||
Within 104 Days [Member] | Final Judgment [Member] | |||||||||||
Litigation settlement, amount | 20 | ||||||||||
Within 194 Days [Member] | Final Judgment [Member] | |||||||||||
Litigation settlement, amount | 30 | ||||||||||
Within 284 Days [Member] | Final Judgment [Member] | |||||||||||
Litigation settlement, amount | 45 | ||||||||||
Within 374 Days [Member] | Final Judgment [Member] | |||||||||||
Litigation settlement, amount | 60 | ||||||||||
Within 464 Days [Member] | Final Judgment [Member] | |||||||||||
Litigation settlement, amount | 70 | ||||||||||
Within 554 Days [Member] | Final Judgment [Member] | |||||||||||
Litigation settlement, amount | 80 | ||||||||||
Within 644 Days [Member] | Final Judgment [Member] | |||||||||||
Litigation settlement, amount | 80 | ||||||||||
Within 734 Days [Member] | Final Judgment [Member] | |||||||||||
Litigation settlement, amount | 80 | ||||||||||
Within 824 Days [Member] | Final Judgment [Member] | |||||||||||
Litigation settlement, amount | 85 | ||||||||||
Within 914 Days [Member] | Final Judgment [Member] | |||||||||||
Litigation settlement, amount | 90 | ||||||||||
Within 1004 Days [Member] | Final Judgment [Member] | |||||||||||
Litigation settlement, amount | $ 90 | ||||||||||
Minimum [Member] | Class Action Litigation [Member] | Pending Litigation [Member] | Settlement Stock Portion [Member] | |||||||||||
Number of common stock shares issued for class action litigation and settlement | shares | 358,333 | ||||||||||
Maximum [Member] | Class Action Litigation [Member] | Settled Litigation [Member] | Settlement Stock Portion [Member] | |||||||||||
Number of common stock shares issued for class action litigation and settlement | shares | 430,000 | ||||||||||
Capacity License Agreement [Member] | Intel Corporation [Member] | |||||||||||
Proceeds to received in increase production | $ 10,000 | ||||||||||
Revenue milestones with related contingent consideration | $ 5,000 | ||||||||||
Number of units produced, capability requirement | Sensor | 1,000,000 | ||||||||||
Deferred revenue | $ 5,000 | ||||||||||
Commisson, percentage | 10.00% | ||||||||||
Fees and commissions | $ 18,500 | ||||||||||
Cost of equipment | 10,100 | ||||||||||
Capacity License Agreement [Member] | Intel Corporation [Member] | Minimum [Member] | |||||||||||
Number of units produced, capability requirement | Sensor | 1,000,000 | ||||||||||
Capacity License Agreement [Member] | Intel Corporation [Member] | Maximum [Member] | |||||||||||
Fees and commissions | $ 18,500 | ||||||||||
Amended Capacity License Agreement [Member] | Intel Corporation [Member] | |||||||||||
Commisson, percentage | 10.00% | ||||||||||
Cash proceeds from license | $ 5,000 | ||||||||||
Gain on relief of deferred revenue liability for discontinued operations | $ 5,000 | ||||||||||
Amended Capacity License Agreement [Member] | Intel Corporation [Member] | Minimum [Member] | |||||||||||
Number of units produced, capability requirement | Sensor | 1,000,000 | ||||||||||
Fees and commissions | $ 6,250 | ||||||||||
Cash proceeds from license | 5,000 | ||||||||||
Amended Capacity License Agreement [Member] | Intel Corporation [Member] | Maximum [Member] | |||||||||||
Fees and commissions | 18,500 | ||||||||||
Cash proceeds from license | $ 10,000 | ||||||||||
Building [Member] | |||||||||||
Area of Real Estate Property | ft² | 7,186 | ||||||||||
Building [Member] | Atmel Corporation X Touch [Member] | |||||||||||
Area of Real Estate Property | ft² | 28,918 | ||||||||||
Building [Member] | Santa Clara CA [Member] | |||||||||||
Area of Real Estate Property | ft² | 4,478 | ||||||||||
Lease Expiration Date | Jul. 14, 2018 | ||||||||||
Building 2 And 4 [Member] | Atmel Corporation [Member] | |||||||||||
Lease Expiration Date | Oct. 15, 2016 |
Commitments and Contingencies -
Commitments and Contingencies - Schedule of Future Minimum Rental Payments for Operating Leases (Details) $ in Thousands | Mar. 31, 2016USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Nine months ending 2016 | $ 151 |
2,017 | 148 |
2,018 | $ 75 |
2,019 | |
2,020 | |
2,021 | |
Total | $ 374 |
Equity, Stock Plan and Warran27
Equity, Stock Plan and Warrants (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Number of common stock shares issued for cash in connection with exercise of stock options | 12,500 | |
Compensation expense recognized for options | $ 167 | $ 541 |
Common stock warrants outstanding | $ 11,070,360 | |
Class of warrant weighted average exercise price | $ 1.59 | |
Stock Incentive Plans [Member] | ||
Number of common stock shares awarded | 3,766,667 | |
Number of shares available for issuance | 469,022 | |
Restricted Stock [Member] | ||
Compensation expense recognized for restricted stock | $ 300 | 400 |
Unrecognized compensation cost related to non-vested shares of restricted stock | $ 1,000 | |
Recognized over a weighted-average period | 1 year 8 months 9 days | |
Number of restricted stock of shares | 57,203 | |
Restricted Stock [Member] | Selling, General and Administrative Expenses [Member] | ||
Compensation expense recognized for restricted stock | $ 300 | 300 |
Restricted Stock [Member] | Research and Development Expense [Member] | ||
Compensation expense recognized for restricted stock | 0 | 100 |
Stock Option [Member] | ||
Unrecognized compensation cost related to non-vested shares of restricted stock | $ 600 | |
Recognized over a weighted-average period | 1 year 8 months 5 days | |
Compensation expense recognized for options | $ 200 | 500 |
Number of vested option increase during the period | 100,000 | |
Stock Option [Member] | Selling, General and Administrative Expenses [Member] | ||
Compensation expense recognized for options | $ 100 | 100 |
Stock Option [Member] | Research and Development Expense [Member] | ||
Compensation expense recognized for options | 100 | $ 400 |
Stock Option [Member] | Cost of Goods Sold [Member] | ||
Compensation expense recognized for options | $ 18 | |
Three Employees [Member] | ||
Number of common stock shares issued for compensation | 57,203 | |
Directors and Officers [Member] | ||
Number of common stock shares issued for compensation | 27,550 |
Equity, Stock Plan and Warran28
Equity, Stock Plan and Warrants - Summary of Changes in Stock Options Outstanding (Details) - $ / shares | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Stockholders' Equity Note [Abstract] | ||
Options Outstanding and expected to vest, Beginning Balance | 1,941,194 | |
Options Granted | 45,000 | |
Options Forfeited or expired | (64,306) | |
Options Exercised | (12,500) | |
Options Outstanding and expected to vest, Ending Balance | 1,921,888 | |
Options Vested and exercisable | 1,457,900 | |
Weighted Average Exercise Price Outstanding and expected to vest, Beginning Balance | $ 6.54 | |
Weighted Average Exercise Price Granted | 0.55 | |
Weighted Average Exercise Price Forfeited or expired | $ 9.82 | |
Weighted Average Exercise Price Exercised | ||
Weighted Average Exercise Price Outstanding and expected to vest, Ending Balance | $ 6.29 | |
Weighted Average Exercise Price Vested and exercisable | $ 7.32 |
Equity, Stock Plan and Warran29
Equity, Stock Plan and Warrants - Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions (Details) - $ / shares | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Stockholders' Equity Note [Abstract] | ||
Expected life (years) | 5 years | 5 years |
Interest rate | 1.21% | |
Interest rate, minimum | 1.31% | |
Interest rate, maximum | 1.57% | |
Dividend yield | 0.00% | 0.00% |
Volatility | 94.31% | |
Volatility, minimum | 144.34% | |
Volatility, maximum | 147.50% | |
Forfeiture rate | 0.00% | 0.00% |
Weighted average fair value per share of options granted | $ 0.39 | $ 5 |
Equity, Stock Plan and Warran30
Equity, Stock Plan and Warrants - Schedule of Outstanding Warrants (Details) - $ / shares | 3 Months Ended | |||
Mar. 31, 2016 | Nov. 30, 2015 | Apr. 16, 2015 | ||
Warrants Outstanding | 11,070,360 | 1,189,492 | 1,151,121 | |
Exercisable | 11,070,360 | |||
Weighted Exercise Price | $ 1.59 | |||
June 10, 2009 [Member] | ||||
Warrants Outstanding | 15,796 | |||
Exercisable | 15,796 | |||
Weighted Exercise Price | $ 7.50 | |||
Remaining Life (Years) | 3 years 2 months 5 days | |||
August 31, 2009 [Member] | ||||
Warrants Outstanding | 24,934 | |||
Exercisable | 24,934 | |||
Weighted Exercise Price | $ 7.50 | |||
Remaining Life (Years) | 3 years 2 months 5 days | |||
October 2, 2009 [Member] | ||||
Warrants Outstanding | 205,000 | |||
Exercisable | 205,000 | |||
Weighted Exercise Price | $ 5 | |||
Remaining Life (Years) | 3 years 6 months 29 days | |||
March 15, 2010 [Member] | ||||
Warrants Outstanding | 8,337 | |||
Exercisable | 8,337 | |||
Weighted Exercise Price | $ 7.50 | |||
Remaining Life (Years) | 3 years 9 months | |||
April 5, 2010 [Member] | ||||
Warrants Outstanding | 930 | |||
Exercisable | 930 | |||
Weighted Exercise Price | $ 7.50 | |||
Remaining Life (Years) | 3 years 9 months | |||
April 16, 2015 [Member] | ||||
Warrants Outstanding | [1] | 1,151,121 | ||
Exercisable | [1] | 1,151,121 | ||
Weighted Exercise Price | [1] | $ 1.50 | ||
Remaining Life (Years) | [1] | 4 years | ||
November 5, 2015 [Member] | ||||
Warrants Outstanding | [1] | 38,371 | ||
Exercisable | [1] | 38,371 | ||
Weighted Exercise Price | [1] | $ 1.50 | ||
Remaining Life (Years) | [1] | 4 years | ||
November 30, 2015 [Member] | ||||
Warrants Outstanding | [1] | 9,625,871 | ||
Exercisable | [1] | 9,625,871 | ||
Weighted Exercise Price | [1] | $ 1.50 | ||
Remaining Life (Years) | [1] | 4 years 8 months 1 day | ||
[1] | The exercise price of the warrants and the number of shares for which the warrants are exercisable are subject to certain adjustments if the Company issues or sells additional shares of common stock or common stock equivalents at a price per share less than the exercise price then in effect, or without consideration. |
Property and Equipment and In31
Property and Equipment and Inventory (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation | $ 300 | $ 1,600 |
Property and Equipment and In32
Property and Equipment and Inventory - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Dec. 31, 2015 | |
Property, and Equipment | $ 6,004 | $ 5,855 |
Accumulated depreciation | (4,296) | (4,013) |
Property and equipment, net | $ 1,708 | 1,842 |
Minimum [Member] | ||
Property and Equipment, Estimated Useful Lives | 3 years | |
Maximum [Member] | ||
Property and Equipment, Estimated Useful Lives | 5 years | |
Production Equipment [Member] | ||
Property, and Equipment | $ 1,966 | 1,966 |
Production Equipment [Member] | Minimum [Member] | ||
Property and Equipment, Estimated Useful Lives | 3 years | |
Production Equipment [Member] | Maximum [Member] | ||
Property and Equipment, Estimated Useful Lives | 5 years | |
Research and Development Equipment [Member] | ||
Property, and Equipment | $ 3,583 | 3,572 |
Research and Development Equipment [Member] | Minimum [Member] | ||
Property and Equipment, Estimated Useful Lives | 3 years | |
Research and Development Equipment [Member] | Maximum [Member] | ||
Property and Equipment, Estimated Useful Lives | 5 years | |
Leasehold Improvements [Member] | ||
Property and Equipment, Estimated Useful Lives | 5 years | |
Property, and Equipment | $ 23 | 23 |
Computer Equipment [Member] | ||
Property and Equipment, Estimated Useful Lives | 5 years | |
Property, and Equipment | $ 98 | 98 |
Office Equipment [Member] | ||
Property, and Equipment | $ 20 | 20 |
Office Equipment [Member] | Minimum [Member] | ||
Property and Equipment, Estimated Useful Lives | 3 years | |
Office Equipment [Member] | Maximum [Member] | ||
Property and Equipment, Estimated Useful Lives | 5 years | |
Construction in Progress [Member] | ||
Property, and Equipment | $ 314 | $ 176 |
Property and Equipment and In33
Property and Equipment and Inventory - Schedule of Inventory (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 | Mar. 31, 2015 |
Property, Plant and Equipment [Abstract] | |||
Raw materials | $ 471 | ||
Work-in-progress | 183 | ||
Finish Goods | 53 | ||
Inventory | $ 707 | $ 769 |
Senior Secured Convertible No34
Senior Secured Convertible Notes and Warrants (Details Narrative) $ / shares in Units, $ in Thousands | Apr. 16, 2015USD ($)Investor$ / sharesshares | Nov. 30, 2015USD ($)Investor$ / sharesshares | Mar. 31, 2016USD ($)shares | Dec. 31, 2015USD ($) | Nov. 23, 2015 |
Debt instrument, face amount | $ 15,000 | $ 500 | $ 15,000 | ||
Class of warrant or rights, granted, shares | shares | 38,371 | ||||
Warrants exercise price per share | $ / shares | $ 9.63 | $ 1.50 | |||
Class of warrant or right, outstanding | shares | 1,151,121 | 1,189,492 | 11,070,360 | ||
Restricted cash and cash equivalents | $ 4,098 | ||||
Convertible notes payable | $ 3,050 | ||||
Debt instrument, convertible, beneficial conversion feature | $ 5,970 | ||||
Atmel Corporation X Touch [Member] | |||||
Debt interest rate percentage | 4.00% | ||||
Debt payment terms | Interest accrues on the unpaid principal amount at a rate equal to 2% per annum compounded semi-annually and is to be paid in arrears semi-annually, commencing with the six-month anniversary of the closing date | ||||
Atmel Corporation X Touch [Member] | Convertible Debt [Member] | |||||
Debt instrument, face amount | $ 15,000 | $ 500 | |||
Class of warrant or rights, granted, shares | shares | 1,151,121 | 38,371 | |||
Number of investers | Investor | 2 | 1 | |||
Equity method investment, ownership percentage | 65.00% | ||||
Debt interest rate percentage | 9.00% | 4.00% | |||
Debt maturity date | Apr. 16, 2016 | ||||
Debt convertible, conversion price per share | $ / shares | $ 8.47 | ||||
Debt convertible, terms of conversion feature | subject to adjustment as set forth in the Convertible Notes for stock splits, dividends, recapitalizations and similar events, which equaled 110% of the last closing price of our common stock prior to the execution and delivery of the Securities Purchase Agreement and 85% of the lowest closing sale price during the prior 30 trading day period. Provided there has been no Equity Conditions Failure, as defined in the Convertible Notes, we will pay the Installment Amount, as defined in the Convertible Notes, by converting all or some of the Installment Amount into common stock (a Company Conversion). However, we may also, at our option, pay the Installment Amount by redeeming the Installment Amount in cash (a Company Redemption) or by any combination of a Company Conversion and a Company Redemption. Any Company Conversion occurs at a price which is the lower of the Conversion Price and 85% of the lower of the arithmetic average of the 4 lowest daily weighted average prices of the common stock during the prior 12 consecutive trading days and the closing sale price on the prior day. | ||||
Debt payment terms | The Investors have the right to accelerate payment on each monthly redemption date of up to two monthly redemption amounts upon written notice to us, and the Investors have the option to be paid such accelerated amount in common stock as if it were a Company Conversion. The Investors also have the right to defer payment of a monthly redemption amount. | ||||
Debt default, description of violation or event of default | Following an Event of Default, as defined in the Convertible Notes, the Investors may require us to redeem all or any portion of the Convertible Notes. The redemption amount may be paid in cash or with shares of our common stock, at the election of the Investor, at a price equal to the Event of Default Redemption Price, as defined in the Convertible Notes. | ||||
Warrants, term of warrants | 5 years | ||||
Warrants exercise price per share | $ / shares | $ 9.63 | $ 1.50 | |||
Percentage of warrants equals to common stock price | 125.00% | ||||
Warrant exercise price of warrants or rights, description | If, after the Effective Date, we issue or sell, or are deemed to have issued or sold, any shares of common stock (with the exception of certain Excluded Securities, as those are defined in the Warrants) for a consideration per share less than a price equal to the exercise price of the Warrants in effect immediately prior to such issue or sale (or deemed issuance or sale) (a Dilutive Issuance), then immediately after the Dilutive Issuance, (x) if the Dilutive Issuance occurs prior to the one year anniversary of the Effective Date, then the exercise price then in effect will be reduced to an amount equal to the product of (A) the exercise price in effect immediately prior to the Dilutive Issuance and (B) the quotient determined by dividing (1) the sum of (I) the product derived by multiplying the exercise price in effect immediately prior to the Dilutive Issuance and the number of Common Shares Deemed Outstanding (as defined in the Warrants) immediately prior to the Dilutive Issuance plus (II) the consideration, if any, received by us on such Dilutive Issuance, by (2) the product derived by multiplying (I) the exercise price in effect immediately prior to the Dilutive Issuance by (II) the number of Common Shares Deemed Outstanding immediately after the Dilutive Issuance and (y) if the Dilutive Issuance occurs after the one year anniversary of the Effective Date but within five years of the Effective Date, the exercise price then in effect will be reduced to an amount equal to the price of the shares of common stock issued in the Dilutive Issuance. The Warrants will be exercisable for cash, but if a prospectus covering the shares of common stock underlying the Warrants is not available, the Investors may exercise the Warrants using a cashless exercise provision. The Warrants may not be exercised if, after giving effect to the exercise, the Investor would beneficially own in excess of 4.99% or 9.99% of the outstanding shares of common stock, depending on the Investor. At the Investors option, the cap applicable to the exercise of the Warrants may be raised or lowered to any other percentage not in excess of 9.99%, except that any increase will only be effective upon 61-days prior notice to us. | ||||
Class of warrant or right, outstanding | shares | 1,189,492 | ||||
Registration rights agreement, description | In conjunction with the issuance of the Convertible Notes and the Warrants, we entered into a Registration Rights Agreement pursuant to which we agreed to file a registration statement covering the sum of (i) 200% of the maximum number of shares underlying the Convertible Notes and (ii) the maximum number of shares underlying the Warrants (the Registrable Securities). We have agreed to keep any registration statement we file pursuant to the Registration Rights Agreement effective until the earlier of (i) the date as of which the Investors may sell all of the Registrable Securities covered by the Registration Statement without restriction or limitation pursuant to Rule 144 and without the requirement to be in compliance with Rule 144(c)(1) (or any successor thereto) or (ii) the date on which the Investors shall have sold all of the securities covered by such Registration Statement. We were to use our reasonable best efforts to have the registration statement declared effective within 90 days after the Effective Date (the Registration Statement Effective Date). If we failed to register the Registrable Securities or the registration statement is not declared effective by the SEC before the Registration Statement Effective Date, or if on any day after the Registration Statement Effective Date, sales of the Registrable Securities required to be included on the Registration Statement cannot be made (collectively, a Registration Default), we will pay to each Investor an amount in cash equal to 1% of the aggregate Purchase Price (as that term is defined in the Securities Purchase Agreement) of the Investors Registrable Securities, whether or not the Registrable Securities were included in the registration statement, and 1% per month (or a portion thereof pro rata) that the Registration Default continues to exist. We are not required to make these payment if, when a Registration Default occurs, the Investors can freely sell our common stock pursuant to Rule 144 without restriction or limitation. | ||||
Secruities purchase agreement, investor rights | Investors in the offering have the right to participate for no less than 35% of any future offering of our equity or equity equivalent securities until the second anniversary of the Effective Date when the Convertible Notes were purchased. | ||||
Restricted cash and cash equivalent item, agreement | We agreed to keep at least $6.0 million of restricted cash on our balance sheet at all times until the Maturity Date or until the outstanding principal amount of the Convertible Notes is less than $6.0 million, at which time the amount of restricted cash we are required to keep on our balance sheet will be adjusted downward, dollar for dollar. As of March 31, 2016 and December 31, 2015, the restricted cash was $0 and $4.1 million, respectively. | ||||
Restricted cash and cash equivalents | $ 6,000 | ||||
Payments of stock issuance costs | 1,700 | ||||
Convertible notes payable | 3,100 | ||||
Warrants, fair value of warrants, granted | 6,000 | ||||
Debt instrument, convertible, beneficial conversion feature | $ 6,000 | ||||
Debt conversion, converted instrument, shares issued | shares | 13,984,411 | ||||
Atmel Corporation X Touch [Member] | Convertible Debt [Member] | Principal [Member] | |||||
Debt conversion, original debt, amount | $ 11,600 | ||||
Atmel Corporation X Touch [Member] | Convertible Debt [Member] | Interest [Member] | |||||
Debt conversion, original debt, amount | $ 300 |
Senior Secured Convertible No35
Senior Secured Convertible Notes and Warrants - Schedule of Convertible Debt (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2016 | Nov. 30, 2015 | Apr. 16, 2015 | |
Debt Disclosure [Abstract] | |||
Convertible notes | $ 15,000 | $ 500 | $ 15,000 |
Discount attributable to warrants | (5,980) | ||
Discount attributable to BCF | (5,970) | ||
Carrying amount of Notes | $ 3,050 |
Senior Secured Convertible No36
Senior Secured Convertible Notes and Warrants - Schedule of Interest, Amortization and Other Expenses Related to Debt (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Debt Disclosure [Abstract] | ||
Interest expense on convertible notes | $ 8 | |
Accretion of convertible note discount | $ 1,291 |
Agreements with Atmel Corpora37
Agreements with Atmel Corporation and CIT Technology LTD.(Details) - USD ($) | Apr. 16, 2015 | Mar. 31, 2016 | Mar. 31, 2015 |
Payments to acquire property, plant, and equipment | $ 149,000 | $ 49,000 | |
Repayment of promissory note plus interest | 2,417,000 | ||
Atmel Corporation [Member] | Licensing Agreements [Member] | |||
Transition services agreement, description | In conjunction with the above-described transaction, Displays and Atmel entered into a Transition Services Agreement. Pursuant to the Transition Services Agreement, Atmel agreed to provide the following services for the periods described: (i) quality assurance and failure analysis services for the XTouch Touch Sensors for a period of six months starting from the Effective Date, (ii) operations services for a period of 30 days starting from the Effective Date and (iii) other services, as those are defined in the Transition Services Agreement, for a period of three months starting from the Effective Date. In exchange for the services, Displays has agreed to pay reasonable and documented direct costs incurred by Atmel in performing the services together with actual out-of-pocket third-party expenses reasonably incurred by Atmel in providing the services. The service fees include, but are not limited to, (a) the actual out-of-pocket employment costs (base salary, payroll taxes and out-of-pocket medical benefits) for the individuals performing the services (based on the actual time expended by such individuals in performing the services), (b) costs of materials, (c) the actual out-of-pocket third-party expenses reasonably incurred by Atmel in providing the services, and (d) direct supervisory and management expenses incurred by Atmel in providing the services. | ||
Payment of transition services | $ 400,000 | ||
Atmel Corporation [Member] | April 2016 [Member] | |||
Repayment of promissory note plus interest | $ 450,000 | ||
Atmel Corporation [Member] | Machinery and Equipment [Member] | |||
Payments to acquire property, plant, and equipment | $ 450,000 | ||
Debt instrument, maturity date, description | the second anniversary of the Effective Date or (ii) the sale of equity and/or debt securities after the Effective Date pursuant to which Displays or any affiliate of our receives gross proceeds of no less than $5 million. | ||
Debt instrument, interest rate, stated percentage | 2.00% | ||
Debt instrument, payment terms | compounded semi-annually and is to be paid in arrears semi-annually, commencing with the six-month anniversary of the Effective Date. | ||
Atmel Corporation [Member] | Building 2 And 4 [Member] | |||
Lessee leasing arrangements, operating leases, term of contract | 18 months | ||
Description of lessee leasing arrangements, operating leases | The term of each lease may be extended for two additional six month periods. | ||
Operating leases, rent expense, minimum rentals | $ 100 | ||
Atmel Corporation [Member] | Building 2 First Renewal Term [Member] | |||
Operating leases, rent expense, minimum rentals | $ 5,625 | ||
Atmel Corporation [Member] | Building 2 Second Renewal Term [Member] | |||
Operating leases, rent expense, minimum rentals | 8,437 | ||
Atmel Corporation [Member] | Building 4 First Renewal Term [Member] | |||
Operating leases, rent expense, minimum rentals | 39,375 | ||
Atmel Corporation [Member] | Building 4 Second Renewal Term [Member] | |||
Operating leases, rent expense, minimum rentals | $ 59,062 | ||
Atmel Corporation X Touch [Member] | |||
Debt instrument, interest rate, stated percentage | 4.00% | ||
Debt instrument, payment terms | Interest accrues on the unpaid principal amount at a rate equal to 2% per annum compounded semi-annually and is to be paid in arrears semi-annually, commencing with the six-month anniversary of the closing date | ||
Atmel Corporation X Touch [Member] | Licensing Agreements [Member] | |||
Patent license agreement, term | 5 years | ||
Patent license agreement, royalty fee, description | greater of $3.25 million or 3.33% of the total net sales (as defined in the Patent License Agreement) of the Touch Sensors during the Initial Term. | ||
Atmel Corporation X Touch [Member] | Licensing Agreements [Member] | License Agreement Renewal Terms [Member] | |||
Patent license agreement, term | 10 years | ||
Patent license agreement, royalty fee, description | If Displays exercises this right, the annual royalty fee will consist of 2.5% of the total net sales of the Touch Sensors until it reaches a total of $16.75 million, at which time no further annual royalty fees will be due. Upon execution of the Patent License Agreement, Displays paid a non-refundable, non-returnable prepayment of minimum annual royalty fees of $9.33 million (the Royalty Prepayment). The Royalty Prepayment will be applied to the annual royalty fees Displays owes under the Patent License Agreement. If, during the Initial Term, Displays cash balances as of the quarter end immediately prior to the date of the royalty period to which an unpaid annual royalty relates is less than $30 million, it may pay the annual royalty fee with a secured promissory note. Atmel has agreed that it will not enter into a license agreement for the licensed patents that is effective prior to the second anniversary of the Effective Date. | ||
CIT Technology Ltd [Member] | Manufacturing Agreement [Member] | |||
Other commitments, description | The Manufacturing Agreement had a term of six months, where Displays agreed that for a period of 16 consecutive weeks it will order, on a weekly basis, 11,500 linear meters of coated film manufactured by CIT at a cost of $7.90 per linear meter. The agreement had been completed and the process was transferred to the Colorado Springs facility in fiscal year 2015. | ||
Long-term purchase commitment, period | 6 months | ||
CIT Technology Ltd [Member] | Licensing Agreements [Member] | |||
Patent license agreement, term | 5 years | ||
Patent license agreement, royalty fee, description | greater of $1.65 million or 1.67% of the total net sales (as defined in the CIT Patent License Agreement) of the Licensed Products during the Initial License Term. | ||
CIT Technology Ltd [Member] | Licensing Agreements [Member] | License Agreement Renewal Terms [Member] | |||
Patent license agreement, term | 10 years | ||
Patent license agreement, royalty fee, description | annual royalty fee will consist of 1.67% of the total net sales of the Licensed Products until it reaches a total of $8.25 million, at which time no further annual royalty fees will be due. Further, the total royalty fees payable for the initial 5 year term and the subsequent 10 year term is capped at $30 million. Upon execution of the CIT Patent License Agreement, Displays paid a non-refundable, non-returnable prepayment of minimum annual royalty fees of $4.67 million (the CIT Royalty Prepayment). The CIT Royalty Prepayment will be applied to the annual royalty fees Displays owes under the CIT Patent License Agreement. If, during the Initial License Term, Displays cash balances as of the quarter end immediately prior to the date of the royalty period to which an unpaid annual royalty relates is less than $30 million, Displays may pay the annual royalty fee with a secured promissory note. CIT has agreed that it will not enter into a license agreement for the licensed patents as they relate to the Licensed Products that is effective prior to the second anniversary of the Effective Date. |
Fair Value Measurements (Detail
Fair Value Measurements (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | ||
Nov. 30, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | Apr. 16, 2015 | |
Fair Value Disclosures [Abstract] | ||||
Warrant outstanding, shares | 1,189,492 | 11,070,360 | 1,151,121 | |
Debt instrument, face amount | $ 500 | $ 15,000 | $ 15,000 | |
Warrant exercise price per share | $ 1.50 | $ 9.63 | ||
Warrant granted, shares | 38,371 | |||
Fair value of warrants | 6,000 | |||
Other expense | $ 407 |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value, Liabilities Measured on Recurring Basis (Details) $ in Thousands | Mar. 31, 2016USD ($) |
Note 10 - Fair Value Measurements (Details) - Fair Value, Liabilities Measured on Recurring Basis [Line Items] | |
Derivative liability | $ 869 |
Fair Value, Inputs, Level 1 [Member] | |
Note 10 - Fair Value Measurements (Details) - Fair Value, Liabilities Measured on Recurring Basis [Line Items] | |
Derivative liability | |
Fair Value, Inputs, Level 2 [Member] | |
Note 10 - Fair Value Measurements (Details) - Fair Value, Liabilities Measured on Recurring Basis [Line Items] | |
Derivative liability | $ 869 |
Fair Value, Inputs, Level 3 [Member] | |
Note 10 - Fair Value Measurements (Details) - Fair Value, Liabilities Measured on Recurring Basis [Line Items] | |
Derivative liability | |
Derivative Liability [Member] | |
Note 10 - Fair Value Measurements (Details) - Fair Value, Liabilities Measured on Recurring Basis [Line Items] | |
Derivative liability | $ 869 |
Derivative Liability [Member] | Fair Value, Inputs, Level 1 [Member] | |
Note 10 - Fair Value Measurements (Details) - Fair Value, Liabilities Measured on Recurring Basis [Line Items] | |
Derivative liability | |
Derivative Liability [Member] | Fair Value, Inputs, Level 2 [Member] | |
Note 10 - Fair Value Measurements (Details) - Fair Value, Liabilities Measured on Recurring Basis [Line Items] | |
Derivative liability | $ 869 |
Derivative Liability [Member] | Fair Value, Inputs, Level 3 [Member] | |
Note 10 - Fair Value Measurements (Details) - Fair Value, Liabilities Measured on Recurring Basis [Line Items] | |
Derivative liability |
Revenue and Credit Concentrat40
Revenue and Credit Concentrations (Details Narrative) | 3 Months Ended |
Mar. 31, 2016Segments | |
Risks and Uncertainties [Abstract] | |
Number of Operating Segments | 1 |
Revenue and Credit Concentrat41
Revenue and Credit Concentrations - Schedules of Customer Concentration Risk (Details) - Customer Concentration Risk [Member] - Sales Revenue, Goods, Net [Member] - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Revenue | $ 817 | $ 7 |
Percentage of Revenue | 96.00% | 100.00% |
Customer A [Member] | ||
Revenue | $ 460 | $ 0 |
Percentage of Revenue | 54.00% | 0.00% |
Customer B [Member] | ||
Revenue | $ 357 | $ 0 |
Percentage of Revenue | 42.00% | 0.00% |
Customer C [Member] | ||
Revenue | $ 0 | $ 7 |
Percentage of Revenue | 0.00% | 100.00% |
Revenue and Credit Concentrat42
Revenue and Credit Concentrations - Schedules of Credit Concentration Risk (Details) - Credit Concentration Risk [Member] - Accounts Receivable [Member] - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Concentration Risk [Line Items] | ||
Accounts Receivable | $ 695 | $ 0 |
Percentage of Accounts Receivable | 95.00% | 0.00% |
Customer A [Member] | ||
Concentration Risk [Line Items] | ||
Accounts Receivable | $ 387 | $ 0 |
Percentage of Accounts Receivable | 53.00% | 0.00% |
Customer B [Member] | ||
Concentration Risk [Line Items] | ||
Accounts Receivable | $ 308 | $ 0 |
Percentage of Accounts Receivable | 42.00% | 0.00% |
Subsequent Event (Details Narra
Subsequent Event (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | |
Apr. 30, 2016 | Mar. 31, 2016 | Mar. 31, 2015 | |
Payment of promissory note plus interest | $ 2,417,000 | ||
Subsequent Event [Member] | Atmel Corporation [Member] | |||
Payment of promissory note plus interest | $ 450,000 | ||
Proceeds from warrants exercises | $ 2,242,500 |