Document and Entity Information
Document and Entity Information - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Mar. 06, 2019 | Jun. 30, 2018 | |
Document And Entity Information | |||
Entity Registrant Name | SPHERIX INC | ||
Entity Central Index Key | 0000012239 | ||
Document Type | 10-K | ||
Trading Symbol | SPEX | ||
Document Period End Date | Dec. 31, 2018 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity a Well-known Seasoned Issuer | No | ||
Entity a Voluntary Filer | No | ||
Entity's Reporting Status Current | Yes | ||
Entity Small Business | true | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Emerging Growth Company | false | ||
Entity Ex Transition Period | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 8,966,900 | ||
Entity Common Stock, Shares Outstanding | 8,542,530 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2018 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Current assets | ||
Cash and cash equivalents | $ 17 | $ 197 |
Marketable securities | 2,700 | 3,998 |
Prepaid expenses and other assets | 188 | 150 |
Total current assets | 2,905 | 4,345 |
Property and equipment, net | 1 | 3 |
Patent portfolios and patent rights, net | 3,578 | |
Investments at fair value | 10,345 | 1,020 |
Deposit | 26 | |
Total assets | 13,251 | 8,972 |
Current liabilities | ||
Accounts payable and accrued expenses | 132 | 56 |
Accrued salaries and benefits | 732 | 695 |
Warrant liabilities | 82 | 822 |
Payable to DatChat | 207 | |
Short-term deferred revenue | 957 | |
Short-term lease liabilities | 48 | |
Total current liabilities | 1,153 | 2,578 |
Long-term deferred revenue | 2,288 | |
Total liabilities | 1,153 | 4,866 |
Stockholders' equity | ||
Common stock, $0.0001 par value, 100,000,000 shares authorized; 8,542,542 and 6,234,910 shares issued at December 31, 2018 and 2017, respectively; 8,542,530 and 6,234,898 shares outstanding at December 31, 2018 and 2017, respectively | 1 | |
Additional paid-in-capital | 152,444 | 149,425 |
Treasury stock, at cost, 12 shares at December 31, 2018 and 2017 | (264) | (264) |
Accumulated deficit | (140,083) | (145,055) |
Total stockholders' equity | 12,098 | 4,106 |
Total liabilities and stockholders' equity | 13,251 | 8,972 |
Series D Preferred Stock [Member] | ||
Stockholders' equity | ||
Preferred Stock | ||
Series D-1 Convertible Preferred Stock [Member] | ||
Stockholders' equity | ||
Preferred Stock |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2018 | Dec. 31, 2017 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, authorized | 100,000,000 | 100,000,000 |
Common stock, issued | 8,542,542 | 6,234,910 |
Common stock, outstanding | 8,542,530 | 6,234,898 |
Treasury stock | 12 | 12 |
Series D Preferred Stock [Member] | ||
Preferred stock, issued | 4,725 | 4,725 |
Preferred stock, outstanding | 4,725 | 4,725 |
liquidation preference (in dollars per share) | $ 0.0001 | $ 0.0001 |
Series D-1 Convertible Preferred Stock [Member] | ||
Preferred stock, issued | 834 | 834 |
Preferred stock, outstanding | 834 | 834 |
liquidation preference (in dollars per share) | $ 0.0001 | $ 0.0001 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Income Statement [Abstract] | ||
Revenues | $ 28 | $ 1,236 |
Operating costs and expenses | ||
Amortization of patent portfolio | 1,405 | 1,373 |
Compensation and related expenses (including stock-based compensation) | 1,012 | 2,059 |
Professional fees | 1,569 | 1,038 |
Impairment of intangible assets | 2,173 | |
Rent | 81 | 92 |
Depreciation expense | 38 | 3 |
Acquisition costs | 230 | |
Other selling, general and administrative | 394 | 493 |
Total operating expenses | 6,902 | 5,058 |
Loss from operations | (6,874) | (3,822) |
Other (expenses) income | ||
Other (expenses) income , net | (333) | 291 |
Change in fair value of investment | 8,194 | 345 |
Change in fair value of warrant liabilities | 740 | (120) |
Total other income | 8,601 | 516 |
Net income (loss) | $ 1,727 | $ (3,306) |
Net income (loss) per share attributable to common stockholders, basic and diluted | ||
Basic (in dollars per share) | $ 0.21 | $ (0.60) |
Diluted (in dollars per share) | $ 0.21 | $ (0.60) |
Weighted average number of common shares outstanding, | ||
Basic (in shares) | 8,058,165 | 5,538,568 |
Diluted (in shares) | 8,061,091 | 5,538,568 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands | Common Stock [Member] | Preferred Stock [Member] | Additional Paid-in [Member] | Treasury Stock [Member] | Accumulated Deficit [Member] | Total |
Beginning Balance at Dec. 31, 2016 | $ 147,331 | $ (264) | $ (141,749) | $ 5,318 | ||
Beginning Balance (in shares) at Dec. 31, 2016 | 4,943,929 | 5,559 | 12 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance common stock in equity raise, net of offering cost | 2,095 | 2,095 | ||||
Issuance common stock in equity raise, net of offering cost (in shares) | 1,250,000 | |||||
Repurchase of restricted stock units to pay for employee withholding taxes | (24) | (24) | ||||
Repurchase of restricted stock units to pay for employee withholding taxes (in shares) | 35,969 | |||||
Stock-based compensation | 23 | 23 | ||||
Stock-based compensation (in shares) | 5,000 | |||||
Net income (loss) | (3,306) | (3,306) | ||||
Ending Balance at Dec. 31, 2017 | 149,425 | $ (264) | (145,055) | 4,106 | ||
Ending Balance (in shares) at Dec. 31, 2017 | 6,234,898 | 5,559 | 12 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance common stock in equity raise, net of offering cost | $ 1 | 2,699 | 2,700 | |||
Issuance common stock in equity raise, net of offering cost (in shares) | 2,222,222 | |||||
Stock-based compensation | 320 | 320 | ||||
Stock-based compensation (in shares) | 85,410 | |||||
Cumulative effect of the changes related to adoption of ASC 606 | 3,245 | 3,245 | ||||
Net income (loss) | 1,727 | 1,727 | ||||
Ending Balance at Dec. 31, 2018 | $ 1 | $ 152,444 | $ (264) | $ (140,083) | $ 12,098 | |
Ending Balance (in shares) at Dec. 31, 2018 | 8,542,530 | 5,559 | 12 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Cash flows from operating activities | ||
Net income (loss) | $ 1,727 | $ (3,306) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Amortization of patent portfolio | 1,405 | 1,373 |
Change in fair value of investment | (8,194) | (345) |
Change in fair value of warrant liabilities | (740) | 120 |
Stock-based compensation | 320 | 23 |
Depreciation expense | 38 | 3 |
Realized loss on marketable securities | 400 | 328 |
Unrealized loss (gain) on marketable securities | 117 | (240) |
Impairment of intangible assets | 2,173 | |
Changes in assets and liabilities: | ||
Prepaid expenses and other assets | (38) | (15) |
Deposit | ||
Accounts payable and accrued expenses | 74 | (67) |
Accrued salaries and benefits | 37 | 249 |
Deferred revenue | (1,216) | |
Accrued lease liabilities | (48) | (179) |
Net cash used in operating activities | (2,729) | (3,272) |
Cash flows from investing activities | ||
Purchase of marketable securities | (14,280) | (12,274) |
Sale of marketable securities | 15,061 | 14,213 |
Purchase of investments at fair value | (922) | (675) |
Release of deposit | 26 | |
Purchase of property and equipment | (36) | |
Net cash (used in) provided by investing activities | (151) | 1,264 |
Cash flows from financing activities | ||
Cash from issuance common stock, net of offering cost | 2,700 | 2,095 |
Repurchase of restricted stock units to pay for employee withholding taxes | (24) | |
Net cash provided by financing activities | 2,700 | 2,071 |
Net (decrease) increase in cash and cash equivalents | (180) | 63 |
Cash and cash equivalents, beginning of period | 197 | 134 |
Cash and cash equivalents, end of period | 17 | 197 |
Cash paid for interest and taxes | 195 | |
Non-cash investing and financing activities | ||
Investment in DatChat | 207 | |
Investment in Mellow Scooters | $ 2 |
Organization and Description of
Organization and Description of Business | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Organization and Description of Business | Note 1. Organization and Description of Business Organization and Description of Business Spherix Incorporated (the “Company”) is technology development committed to the fostering of innovative ideas. The Company was incorporated in 1967 in the State of Delaware as a scientific research company, and for much of its history pursued drug development including through Phase III clinical studies which were discontinued. Such monetization included, but was not limited to, acquiring IP from patent holders in order to maximize the value of the patent holdings by conducting and managing a licensing campaign, commercializing the IP, or through the settlement and litigation of patents. The Company was formerly focused on commercializing and monetizing patents by acquiring IP from patent holders in order to maximize the value of the patent holdings by conducting and managing a licensing campaign, or through the settlement and litigation of patents. Since March 1, 2013, the Company has received limited funds from its IP monetization. In addition to our patent monetization efforts, since the fourth quarter of 2017, we have been transitioning to focus our efforts as a technology development company. These efforts have focused on biotechnology research and blockchain technology research. The Company’s biotechnology research development includes investments in Hoth Therapeutics Inc. and the proposed merger with CBM BioPharma, Inc. (“CBM”). The Company made no investments in new IP during 2017 and 2018. Hoth Therapeutics is a development stage biopharmaceutical company focused on proprietary therapeutics for patients suffering from indications such as atopic dermatitis, also known as eczema. To treat indications impacting more than 32 million Americans, Hoth is working to develop and commercialize the BioLexa Platform, a proprietary, patented, drug compound platform developed at the University of Cincinnati. The BioLexa Platform has achieved positive results at preclinical studies conducted at the University of Miami. In addition to Hoth, the Company is proposing a merger with CBM. In October 2018, the Company entered into an agreement and plan of merger, subject to shareholder approval, with CBM, a pharmaceutical company focusing on the development of cancer treatments, pursuant to which all shares of capital stock of CBM will be converted into the right to receive an aggregate of 15,000,000 shares of the Company’s common stock with CBM continuing as the surviving corporation in the merger. In the field of blockchain research, the Company previously entered into an agreement and plan of merger, subject to shareholder approval, with DatChat, Inc. (the “DatChat Merger”), a secure messaging application that utilizes blockchain technology. After further negotiations, the Company determined not to pursue a merger with DatChat and on August 8, 2018, entered into a Securities Purchase Agreement with DatChat pursuant to which the Company and DatChat agreed to terminate the DatChat Merger and the Company agreed to make a $1,000,000 strategic investment in DatChat which consisted of (a) a cash payment of $500,000, (b) the forgiveness of prior advances made to DatChat by the Company, and (c) an obligation of the Company to pay certain specific future compensation expenses of DatChat (amounts in clauses (b) and (c) not to exceed a maximum of $500,000 in the aggregate); in exchange for $1,000,000 of restricted shares of DatChat common stock. Pursuant to the Securities Purchase Agreement, the Company applied a total of approximately $293,000 prior advances towards its investment in DatChat (“Prior Incurred Amount”), including $272,000 of compensation related costs and $21,000 professional fees. The Company also recorded approximately $207,000 compensation expenses payable to DatChat (“Payable to DatChat”) in addition to the $293,000 advances to reach the $500,000 maximum. The breakdown of investment at Datchat as December 31, 2018 are as follows ($ in thousands): DatChat Cash Payment $ 500 Prior Incurred Amount Made to DatChat 293 Payable to DatChat 207 Total 1,000 On November 23, 2018, the Company entered into a Security Purchase Agreement with Mellow Scooters, LLC (“Mellow Scooters”), a leading-edge company that enables anyone to own and operate a personal fleet of electric scooters and dockless bicycles to generate revenue. Mellow Scooters agreed to sell 250 Units to the Company, representing 25% of its issued and outstanding limited liability company membership interests for a subscription price of $106,000. The $106,000 consisted of (a) a cash payment of $30,000, (b) the forgiveness of prior advances made to Mellow Scooters by the Company, and (c) an obligation of the Company to pay certain specific future expenses of Mellow Scooters (amounts in clauses (b) and (c) not to exceed a maximum of $76,000 in the aggregate). As of December 31, 2018, the Company has applied a total of approximately $74,000 prior advances towards its investment in Mellow Scooters, including $71,000 compensation related cost and $3,500 professional fees. The Company also recorded $2,000 payable for professional fees of Mellow Scooter in addition to the $74,000 advances to reach the $76,000 maximum. The breakdown of investment at Mellow Scooters as December 31, 2018 are as follows ($ in thousands): Mellow Scooters Cash Payment $ 30 Prior Incurred Amount Made to Mellow Scooters 74 Payable to Mellow Scooters 2 Total 106 CBM Merger On October 10, 2018, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”), by and among the Company, Spherix Delaware Merger Sub Inc., a Delaware corporation and a wholly-owned subsidiary of Spherix (“Merger Sub”), CBM, and Scott Wilfong in the capacity as the representative from and after the effective time of the Merger (as defined below) (the “Effective Time”) for the stockholders of CBM as of immediately prior to the Effective Time (the “Stockholder Representative”). Pursuant to the Merger Agreement and subject to the terms and conditions set forth therein, at the closing of the transactions contemplated by the Merger Agreement, Merger Sub will merge with and into CBM (the “Merger”), with CBM continuing as the surviving corporation in the Merger. Subject to the terms and conditions set forth in the Merger Agreement, at the Effective Time: (i) all shares of capital stock of CBM (the “CBM Stock”) issued and outstanding immediately prior to the Effective Time will be converted into the right to receive the Stockholder Merger Consideration (as defined below). As consideration for the Merger, the Company shall deliver to the stockholders of CBM an aggregate of 15,000,000 shares of Company common stock (the “Stockholder Merger Consideration”), with each share of Company common stock valued at $1.10 per share. At or prior to the Closing, the Company, the Stockholder Representative, and a mutually agreeable escrow agent (the “Escrow Agent”), shall enter into an Escrow Agreement, effective as of the Effective Time, in form and substance reasonably satisfactory to the parties (the “Escrow Agreement”), pursuant to which the Company shall deposit with the Escrow Agent 1,500,000 shares from the Stockholder Merger Consideration otherwise deliverable to the stockholders of CBM who own beneficially and of record greater than 10% of the CBM common stock issued and outstanding immediately prior to the Closing (each a “Significant Company Stockholder”) (including any equity securities paid as dividends or distributions with respect to such shares or into which such shares are exchanged or converted, the “Escrow Shares”), to be held in a segregated escrow account (the “Escrow Account”) and disbursed by the Escrow Agent. Each stockholder of CBM Stockholder at the Effective Time (each, a “CBM Stockholder”) shall receive its pro rata share of the Stockholder Merger Consideration (less, in the case of each of the Significant Company Stockholders, its pro rata portion of the Escrow Shares held in the Escrow Account) based on the number of shares of CBM Stock owned by such CBM Stockholder as compared to the total number of shares of CBM Stock owned by all CBM Stockholders as of immediately prior to the Effective Time. The Escrow Shares shall serve as a security for, and a source of payment of, the indemnity rights of the Company indemnified parties. In the event that this Agreement is terminated by the Company pursuant to certain sections of the Agreement, then the Company may be required to deliver to CBM certificate(s) representing an aggregate of 400,000 shares of the Company’s Common Stock within two (2) business days of termination. |
Liquidity and Financial Conditi
Liquidity and Financial Condition | 12 Months Ended |
Dec. 31, 2018 | |
Liquidity And Financial Condition | |
Liquidity and Financial Condition | Note 2. Liquidity and Financial Condition The Company continues to incur ongoing administrative and other expenses, including public company expenses, in excess of corresponding (non-financing related) revenue. While the Company continues to implement its business strategy, it intends to finance its activities through: ● managing current cash and cash equivalents on hand from the Company’s past debt and equity offerings, ● seeking additional funds raised through the sale of additional securities in the future, ● seeking additional liquidity through credit facilities or other debt arrangements, and ● increasing revenue from its patent portfolios, license fees and new business ventures. The Company’s ultimate success is dependent on its ability to obtain additional financing and generate sufficient cash flow to meet its obligations on a timely basis. The Company’s business will require significant amounts of capital to sustain operations and make the investments it needs to execute its longer-term business plan to support new technologies and help advance innovation. The Company’s working capital amounted to approximately $1.8 million at December 31, 2018. Absent generation of sufficient revenue from the execution of the Company’s long-term business plan, the Company will need to obtain additional debt or equity financing, especially if the Company experiences downturns in its business that are more severe or longer than anticipated, or if the Company experiences significant increases in expense levels resulting from being a publicly-traded company or operations. If the Company attempts to obtain additional debt or equity financing, the Company cannot assume that such financing will be available to the Company on favorable terms, or at all. Because of recurring operating losses, net operating cash flow deficits, and an accumulated deficit, there is substantial doubt about the Company’s ability to continue as a going concern within one year from the date of this filing. The consolidated financial statements have been prepared assuming that the Company will continue as a going concern, and do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets, or the amounts and classification of liabilities that may result from the outcome of this uncertainty. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 3. Summary of Significant Accounting Policies Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Nuta Technology Corp. (“Nuta”), Spherix Portfolio Acquisition II, Inc. (“SPAII”), Guidance IP, LLC (“Guidance”), Directional IP, LLC (“Directional”), Spherix Management Services, LLC (“SMS”), Spherix Delaware Merger Sub Inc. (“Merger Sub”), Spherix Merger Subsidiary, Inc (“SMSI”) and NNPT, LLC (“NNPT”). All significant intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“US GAAP”). This requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the period. The Company’s significant estimates and assumptions include the recoverability and useful lives of long-lived assets, stock-based compensation, the valuation of derivative liabilities, the valuation of investments and the valuation allowance related to the Company’s deferred tax assets. Certain of the Company’s estimates, including the carrying amount of the intangible assets, could be affected by external conditions, including those unique to the Company and general economic conditions. It is reasonably possible that these external factors could have an effect on the Company’s estimates and could cause actual results to differ from those estimates and assumptions. Segments The Company operates in one operating segment and, accordingly, no segment disclosures have been presented herein. Concentration of Cash The Company maintains cash balances at two financial institutions in checking accounts and money market accounts. The Company considers all highly liquid investments with original maturities of three months or less when purchased to be cash equivalents. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash. Marketable Securities Marketable securities are classified as trading and are carried at fair value. The Company’s marketable securities consist of corporate bonds and highly liquid mutual funds and exchange-traded & closed-end funds which are valued at quoted market prices. Fair Value of Financial Instruments Financial instruments, including cash and cash equivalents, accounts payable and accrued liabilities are carried at cost, which management believes approximates fair value due to the short-term nature of these instruments. The Company measures the fair value of financial assets and liabilities based on the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Company maximizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value. The Company uses three levels of inputs that may be used to measure fair value: Level 1 - quoted prices in active markets for identical assets or liabilities Level 2 - quoted prices for similar assets and liabilities in active markets or inputs that are observable Level 3 - inputs that are unobservable (for example, cash flow modeling inputs based on assumptions) Property and Equipment Property and equipment are stated at cost and include office furniture and equipment and computer hardware and software. The Company computes depreciation and amortization under the straight-line method and typically over the following estimated useful lives of the related assets: ● Office furniture and equipment 3 to 10 years ● Computer hardware and software 3 to 5 years Impairment of Long-lived Assets (Including Patent Assets) The Company monitors the carrying value of long-lived assets for potential impairment and tests the recoverability of such assets whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable. If a change in circumstance occurs, the Company performs a test of recoverability by comparing the carrying value of the asset or asset group to its undiscounted expected future cash flows. If cash flows cannot be separately and independently identified for a single asset, the Company will determine whether impairment has occurred for the group of assets for which the Company can identify the projected cash flows. If the carrying values are in excess of undiscounted expected future cash flows, the Company measures any impairment by comparing the fair value of the asset or asset group to its carrying value. The Company performed impairment tests for intangible assets at December 31, 2018 and 2017. An impairment charge of approximately $2.2 million and nil was taken during the year ended December 31, 2018 and 2017, respectively. Convertible Preferred Stock The Company applies the accounting standards for distinguishing liabilities from equity when determining the classification and measurement of its preferred stock. Preferred shares subject to mandatory redemption are classified as liability instruments and are measured at fair value. Conditionally redeemable preferred shares (including preferred shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) are classified as temporary equity. At all other times, preferred shares are classified as stockholders’ equity. The Company accounts for convertible preferred stock with detachable warrants in accordance with ASC 470: Debt The Company has also evaluated its convertible preferred stock and warrants in accordance with the provisions of ASC 815, Derivatives and Hedging Treasury Stock The Company accounts for the treasury stock using the cost method, which treats it as a reduction in stockholders’ equity. Revenue Recognition The Company recognizes revenue under ASC 606, Revenue from Contracts with Customers The Company recognizes revenue under ASC 606, Revenue from Contracts with Customers ● Step 1: Identify the contract with the customer ● Step 2: Identify the performance obligations in the contract ● Step 3: Determine the transaction price ● Step 4: Allocate the transaction price to the performance obligations in the contract ● Step 5: Recognize revenue when the company satisfies a performance obligation In order to identify the performance obligations in a contract with a customer, a company must assess the promised goods or services in the contract and identify each promised good or service that is distinct. A performance obligation meets ASC 606’s definition of a “distinct” good or service (or bundle of goods or services) if both of the following criteria are met: ● The customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer (i.e., the good or service is capable of being distinct). ● The entity’s promise to transfer the good or service to the customer is separately identifiable from other promises in the contract (i.e., the promise to transfer the good or service is distinct within the context of the contract). If a good or service is not distinct, the good or service is combined with other promised goods or services until a bundle of goods or services is identified that is distinct. The transaction price is the amount of consideration to which an entity expects to be entitled in exchange for transferring promised goods or services to a customer. The consideration promised in a contract with a customer may include fixed amounts, variable amounts, or both. When determining the transaction price, an entity must consider the effects of all of the following: ● Variable consideration ● Constraining estimates of variable consideration ● The existence of a significant financing component in the contract ● Noncash consideration ● Consideration payable to a customer Variable consideration is included in the transaction price only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. The transaction price is allocated to each performance obligation on a relative standalone selling price basis. The transaction price allocated to each performance obligation is recognized when that performance obligation is satisfied, at a point in time or over time as appropriate. As of December 31, 2018, there were no contract assets or liabilities associated with the Company’s settlement and licensing agreements. During the year ended December 31, 2018, the Company only generated $28 thousand of revenue. Inventor Royalties Inventor royalties are expensed in the period that the related revenues are recognized. In certain instances, pursuant to the terms of the underlying inventor agreements, costs paid by the Company to acquire patents are recoverable from future net revenues. Patent acquisition costs that are recoverable from future net revenues are amortized over the estimated economic useful life of the related patents, or as the prepaid royalties are earned by the inventor, as appropriate, and the related expense is included in amortization expense. Accounting for Warrants The Company accounts for the issuance of common stock purchase warrants issued in connection with the equity offerings in accordance with the provisions of ASC 815, Derivatives and Hedging (“ASC 815”). The Company classifies as equity any contracts that (i) require physical settlement or net-share settlement or (ii) gives the Company a choice of net-cash settlement or settlement in its own shares (physical settlement or net-share settlement). The Company classifies as assets or liabilities any contracts that (i) require net-cash settlement (including a requirement to net-cash settle the contract if an event occurs and if that event is outside the control of the Company) or (ii) gives the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement). In addition, Under ASC 815, registered common stock warrants that require the issuance of registered shares upon exercise and do not expressly preclude an implied right to cash settlement are accounted for as derivative liabilities. The Company classifies these derivative warrant liabilities on the consolidated balance sheet as a current liability. The Company assessed the classification of common stock purchase warrants as of the date of each offering and determined that such instruments met the criteria for liability classification. Accordingly, the Company classified the warrants as a liability at their fair value and adjusts the instruments to fair value at each reporting period. This liability is subject to re-measurement at each balance sheet date until the warrants are exercised or expired, and any change in fair value is recognized as “change in the fair value of warrant liabilities” in the consolidated statements of operations. The fair value of the warrants has been estimated using a Black-Scholes valuation model (see Note 8). Stock-based Compensation The Company accounts for share-based payment awards exchanged for employee services at the estimated grant date fair value of the award. Stock options issued under the Company’s long-term incentive plans are granted with an exercise price equal to no less than the market price of the Company’s stock at the date of grant and expire up to ten years from the date of grant. These options generally vest over a one- to five-year period. The fair value of stock options granted was determined on the grant date using assumptions for risk free interest rate, the expected term, expected volatility, and expected dividend yield. The risk-free interest rate is based on U.S. Treasury zero-coupon yield curve over the expected term of the option. The expected term assumption is determined using the weighted average midpoint between vest and expiration for all individuals within the grant. The expected volatility assumption is computed based on the standard deviation of the Company’s underlying stock price’s daily logarithmic returns. The Company’s model includes a zero dividend yield assumption, as the Company has not historically paid nor does it anticipate paying dividends on its common stock. The Company’s model does not include a discount for post-vesting restrictions, as the Company has not issued awards with such restrictions. The periodic expense is then determined based on the valuation of the options, and at that time an estimated forfeiture rate is used to reduce the expense recorded. In addition to the assumptions used in the Black-Scholes option-pricing model, the amount of stock option expense the Company recognizes in the consolidated statements of operations includes an estimate of stock option forfeitures. Under ASC 718, the Company is required to estimate the level of forfeitures expected to occur and record compensation expense only for those awards that ultimately expect will vest. The Company recognizes the effect of forfeitures in compensation expense when the forfeitures occur. Income Taxes The Company uses the asset and liability method of accounting for income taxes in accordance with ASC 740, “Income Taxes” (“ASC 740”). Under this method, income tax expense is recognized as the amount of: (i) taxes payable or refundable for the current year and (ii) deferred tax consequences of temporary difference resulting from matters that have been recognized in the Company’s financial statement or tax returns. Deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities measured at the enacted tax rates in effect for the year in which these items are expected to reverse. Deferred tax assets are reduced by valuation allowances if, based on the consideration of all available evidence, it is more likely than not that some portion or all of the deferred tax asset will not be realized. Net Loss per Share Basic loss per share is computed by dividing the net income or loss applicable to common shares by the weighted average number of common shares outstanding during the period. Net income (loss) attributable to common stockholders includes the effect of the deemed capital contribution on extinguishment of preferred stock and the deemed dividend related to the immediate accretion of beneficial conversion feature of convertible preferred stock. Diluted earnings per share is computed using the weighted average number of common shares and, if dilutive, potential common shares outstanding during the period. Potential common shares consist of the incremental common shares issuable upon the exercise of stock options (using the treasury stock method) and the conversion of the Company’s convertible preferred stock and warrants (using the if-converted method). Diluted loss per share excludes the shares issuable upon the conversion of preferred stock and the exercise of stock options and warrants from the calculation of net loss per share if their effect would be anti-dilutive. The following table summarizes the earnings (loss) per share calculation (in thousands, except per share amount): For the Years Ended December 31, 2018 2017 Basic earnings per share Numerator: Net income (loss) $ 1,727 $ (3,306 ) Net income (loss) available to common stockholders $ 1,727 $ (3,306 ) Denominator: Weighted average number of common shares outstanding, 8,058,165 5,538,568 Earnings per basic share: Net loss 0.21 (0.60 ) Net income (loss) available to common stockholders $ 0.21 $ (0.60 ) Dilutive earnings per share Numerator: Net income (loss) $ 1,727 $ (3,306 ) Net income (loss) available to common stockholders $ 1,727 $ (3,306 ) Denominator: Weighted average basic shares outstanding, 8,058,165 5,538,568 Weighted average effect of dilutive securities Employee stock options — — Convertible preferred stock 2,926 — Weighted average diluted shares outstanding 8,061,091 5,538,568 Earnings per diluted share: Net income (loss) $ 0.21 $ (0.60 ) Net income (loss) available to common stockholders $ 0.21 $ (0.60 ) Securities that could potentially dilute loss per share in the future that were not included in the computation of diluted loss per share at December 31, 2018 and 2017 are as follows: As of December 31, 2018 2017 Convertible preferred stock 2,926 2,926 Warrants to purchase common stock 1,249,754 1,249,754 Options to purchase common stock 528,427 328,490 Total 1,781,107 1,581,170 Recently Issued Accounting Standards In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) ASU No. 2016-02, Leases (Topic 842) Leases (Topic 840) In July 2017, the FASB issued ASU 2017-11, Earnings Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480) and Derivatives and Hedging (Topic 815): I. Accounting for Certain Financial Instruments with Down Round Features; II. Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception In June 2018, the FASB issued ASU 2018-07, Compensation-Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting In August 2018, the SEC adopted the final rule under SEC Release No. 33-10532, Disclosure Update and Simplification, amending certain disclosure requirements that were redundant, duplicative, overlapping, outdated or superseded. In addition, the amendments expanded the disclosure requirements on the analysis of stockholders’ equity for interim financial statements. Under the amendments, an analysis of changes in each caption of stockholders’ equity presented in the balance sheet must be provided in a note or separate statement. The analysis should present a reconciliation of the beginning balance to the ending balance of each period for which a statement of comprehensive income is required to be filed. This final rule is effective on November 5, 2018. The Company is evaluating the impact of this guidance on its consolidated financial statements. The Company anticipates its first presentation of changes in stockholders’ equity will be included in its Form 10-Q for the quarter ended March 31, 2019. In August 2018, the FASB issued ASU 2018-13, “Fair Value Measurement (Topic 820), - Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement,” which makes a number of changes meant to add, modify or remove certain disclosure requirements associated with the movement amongst or hierarchy associated with Level 1, Level 2 and Level 3 fair value measurements. This guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted upon issuance of the update. The Company does not expect the adoption of this guidance to have a material impact on its consolidated Financial Statements. Recently Adopted Accounting Standards In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (ASU 2014-09) as modified by ASU No. 2015-14, “Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date,” ASU 2016-08, “Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net),” ASU No. 2016-10, “Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing,” and ASU No. 2016-12, “Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients.” The revenue recognition principle in ASU 2014-09 is that an entity should recognize revenue to depict the transfer of 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. In addition, new and enhanced disclosures will be required. Companies may adopt the new standard either using the full retrospective approach, a modified retrospective approach with practical expedients, or a cumulative effect upon adoption approach. The Company adopted the new standard effective January 1, 2018, using the modified retrospective approach. The Company has determined that its licenses represent functional intellectual property under Topic 606. Therefore, revenue is recognized at the point in time when the customer has the right to use the intellectual property rather than over the license period. Accordingly, the Company’s deferred revenue related to its licenses was eliminated and accumulated deficit as of January 1, 2018 was decreased by approximately $3.2 million so that the Company will not recognize revenue on earnings statements in the future as to its license. Absent the adoption of ASC 606, the Company would have recorded approximately $1.0 million of deferred revenue for the year ended December 31, 2018. In January 2016, the FASB issued ASU No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities In May 2017, the Financial Accounting Standards Board (the FASB) issued ASU 2017-09, Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting |
Investments in Marketable Secur
Investments in Marketable Securities | 12 Months Ended |
Dec. 31, 2018 | |
Investments In Marketable Securities | |
Investments in Marketable Securities | Note 4. Investments in Marketable Securities The realized gain or loss, unrealized gain or loss, and dividend income related to marketable securities for the year ended December 31, 2018 and 2017 are as follows ($ in thousands): For the Years Ended December 31, 2018 2017 Realized gain (loss) $ (400 ) $ (328 ) Unrealized gain (loss) (117 ) 240 Dividend income 158 111 $ (359 ) $ 23 |
Investment in Hoth Therapeutics
Investment in Hoth Therapeutics, Inc. | 12 Months Ended |
Dec. 31, 2018 | |
Investment In Hoth Therapeutics Inc. | |
Investment in Hoth Therapeutics, Inc. | Note 5. Investment in Hoth Therapeutics, Inc. On June 30, 2017 (the “Closing Date”), the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with Hoth Therapeutics, Inc., a Nevada corporation (“Hoth”), for the purchase of an aggregate of 1,700,000 shares of common stock, par value $0.0001 (the “Shares”), of Hoth, for a purchase price of $675,000. Hoth is a development stage biopharmaceutical company focused on unique targeted therapeutics for patients suffering from indications such as atopic dermatitis, also known as eczema. Hoth’s primary asset is a sublicense agreement with Chelexa Biosciences, Inc. (“Chelexa”) pursuant to which Chelexa has granted Hoth an exclusive sublicense to use its BioLexa products for the treatment of eczema. On February 15, 2019, Hoth announced the pricing of its initial public offering (“IPO) of 1,250,000 shares of its common stock at an initial offering price to the public of $5.60 per share. All shares of common stock were offered by Hoth. Hoth’s common stock commenced trading on The Nasdaq Capital Market, on February 15, 2019 under the ticker symbol “HOTH”. The IPO closed on February 20, 2019. The Company records this investment at fair value and records any change in fair value in the statements of operations (see Note 8). |
Investment in DatChat, Inc.
Investment in DatChat, Inc. | 12 Months Ended |
Dec. 31, 2018 | |
Investment In Datchat Inc. | |
Investment in DatChat, Inc. | Note 6. Investment in DatChat, Inc. On August 8, 2018, the Company entered into a securities purchase agreement (the “Securities Purchase Agreement”) with DatChat. Under the Securities Purchase Agreement, the Company agreed to make a $1,000,000 strategic investment in DatChat. See Note 1 for further explanation. As described in Note 3 to these consolidated financial statements, effective January 1, 2018, the Company adopted ASU 2016-01 concerning recognition and measurement of financial assets and financial liabilities. In adopting this new guidance, the Company has made an accounting policy election to adopt an adjusted cost method measurement alternative for its investment in DatChat. The Company records its investment at fair value and changes in fair value, if any, are recorded in the statement of operations (see Note 8). |
Intangible Assets
Intangible Assets | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Note 7. Intangible Assets Patent Portfolio The Company’s intangible assets with finite lives consist of its patents and patent rights. For all periods presented, all of the Company’s identifiable intangible assets were subject to amortization. The net carrying amounts related to acquired intangible assets are as follows ($ in thousands): Net Carrying Amount Weighted average Patent Portfolios and Patent Rights at December 31, 2016, net $ 4,951 3.65 Amortization expenses (1,373 ) Patent Portfolios and Patent Rights at December 31, 2017, net $ 3,578 2.67 Amortization expenses (1,405 ) Impairment loss (2,173 ) Patent Portfolios and Patent Rights at December 31, 2018, net $ — — The Company reviews its patent portfolio for impairment as a single asset group whenever events or changes in circumstances indicate that the carrying value may not be recoverable. The Company reviews its patent portfolio for impairment as a single asset group whenever events or changes in circumstances indicate that the carrying value may not be recoverable. During the year ended 2018, the Company determined that certain events occurred that were indicators of a potential impairment. In accordance with ASC 360-10, the Company first estimated the future undiscounted cash flows anticipated to be generated by the patent portfolio based on the Company’s current usage and future plans for the patent portfolio over its remaining weighted average useful life. Given the short-term nature of the patents the undiscounted cash flows approximate discounted cash flows. The analysis concluded that the carrying amount of the patent portfolio was not recoverable. The Company recorded a $2.2 million impairment charge against its patent portfolio to write off the entire remaining balance of the intangible assets during the year ended December 31, 2018. There was no impairment charges recorded during the year ended December 31, 2017. |
Fair Value of Financial Assets
Fair Value of Financial Assets and Liabilities | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Assets and Liabilities | Note 8. Fair Value of Financial Assets and Liabilities Financial instruments, including cash and cash equivalents, accounts payable and accrued liabilities are carried at cost, which management believes approximates fair value due to the short-term nature of these instruments. The Company measures the fair value of financial assets and liabilities based on the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Company maximizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value. The Company uses three levels of inputs that may be used to measure fair value: Level 1 - quoted prices in active markets for identical assets or liabilities Level 2 - quoted prices for similar assets and liabilities in active markets or inputs that are observable Level 3 - inputs that are unobservable (for example, cash flow modeling inputs based on assumptions) The following table presents the Company’s assets and liabilities that are measured at fair value at December 31, 2018 and 2017 ($ in thousands): Fair value measured at December 31, 2018 Quoted prices in Significant other Significant Total at December 31, active markets observable inputs unobservable inputs 2018 (Level 1) (Level 2) (Level 3) Assets Marketable securities - exchange traded funds $ 2,700 $ 2,700 $ — $ — Investments at Hoth $ 9,214 $ — $ — $ 9,214 Investments at DatChat $ 1,000 $ — $ — $ 1,000 Other investments $ 131 $ — $ — $ 131 Liabilities Fair value of warrant liabilities $ 82 $ — $ — $ 82 Fair value measured at December 31, 2017 Total carrying value at December 31, Quoted prices in active markets Significant other observable inputs Significant unobservable inputs 2017 (Level 1) (Level 2) (Level 3) Assets Marketable securities - mutual and exchange traded funds $ 3,998 $ 976 $ 3022 $ — Investments at Hoth $ 1,020 $ — $ — $ 1,020 Liabilities Fair value of warrant liabilities $ 822 $ — $ — $ 822 There were no transfers between Level 1, 2 or 3 for the years ended December 31, 2018 and 2017. Level 2 Valuation Techniques The fair values of Level 2 marketable securities are determined using one or more quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly. Level 3 Valuation Techniques Level 3 Valuation Techniques – Assets The following table sets forth a summary of the changes in the fair value of the Company’s Level 3 financial assets that are measured at fair value on a recurring basis: Fair Value of Level 3 investment December 31, December 31, 2018 2017 Beginning balance $ 1,020 $ — Purchase of other investments at fair value 131 — Purchase of investment in DatChat at fair value 1,000 — Fair value of Hoth upon issuance — 675 Change in fair value of Hoth 8,194 345 Ending balance $ 10,345 $ 1,020 While the Company believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different estimate of fair value at the reporting date. The decision to elect the fair value option, which is irrevocable once elected, is determined on an instrument by instrument basis and applied to an entire instrument. The net gains or losses, if any, on an investment for which the fair value option has been elected, are recognized as change in fair value of investment in the Consolidated Statements of Operations. A summary of quantitative information with respect to the valuation methodology and significant unobservable inputs used for the Company’s valuation in Hoth that are categorized within Level 3 of the fair value hierarchy at the date of issuance and as of December 31, 2018 and 2017 is as follows: Date of valuation December 31, 2018 December 31, 2017 Risk-free interest rate 2.45 % 1.83 % Expected volatility 75.00 % 75.00 % Contractual life (in years) 0.17 1.50 The investment in Hoth Therapeutics as of December 31, 2018 was valued using the PWERM (Probability Weighted Expected Return Method). Under this method, an analysis of future values of a company is performed for several likely scenarios. These scenarios included both a high and low range of values that were provided to Hoth Therapeutics by their investment bankers. The price per share was $6.50 and $5.50, respectively. The value is then discounted to the present using a risk-adjusted discount rate of 15%. The present values of the common stock under each scenario are then weighted based on the probability of each scenario occurring to determine the value of the investment. A 10% probability was placed on the high end and a 90% probability was placed on the low end. The investment in Hoth Therapeutics as of December 31, 2017 was valued using a hybrid probability weighted expected return method, with scenarios including (1) Hoth continuing to operate as a private company through an estimated potential exit date, and (2) Hoth undergoing an IPO in the near future. The private-company scenario utilizes a reverse option pricing method (backsolve) based on the recent Series A transaction. Key inputs to the backsolve, in addition to the Series A price, include volatility (75.00%) and expected maturity (1.0 years). The IPO scenario is based on initial value indications proposed by investment bankers. The primary inputs, in addition to the pre-money value indications, include the estimated time to IPO (end of November) and a discount rate of 15%. The valuation conclusion is sensitive to the probability weightings assigned to each scenario. The weightings (1/3 IPO scenario, 2/3 private company scenario), were determined according to management expectations regarding exit opportunities, based on what was known or knowable as of December 31, 2017. The costs of its investment in the BitDaily, DatChat and Mellow Scooters approximate fair value as there have been no significant changes to its investment since the date of purchase. Intangible Assets Measured at Fair Value on a Non-Recurring Basis using Level 3 Inputs The following tables presents the Company’s hierarchy for nonfinancial assets measured at fair value on a non-recurring basis (in thousands): Impairment Charges - Net Carrying Value at Year Ended December December 31, 2018 31, 2018 Assets Patent Portfolios, Net $ — $ 2,173 Impairment Charges - Net Carrying Value at Year Ended December December 31, 2017 31, 2017 Assets Patent Portfolios, Net $ 3,578 $ — The Company’s intangible assets are measured at fair value on a non-recurring basis using Level 3 inputs. See Note 7 for valuation techniques for patents. Level 3 Valuation Techniques – Liabilities Level 3 financial liabilities consist of the warrant liabilities for which there is no current market for these securities such that the determination of fair value requires significant judgment or estimation. Changes in fair value measurements categorized within Level 3 of the fair value hierarchy are analyzed each period based on changes in estimates or assumptions and recorded as appropriate. A significant decrease in the volatility or a significant decrease in the Company’s stock price, in isolation, would result in a significantly lower fair value measurement. Changes in the values of the warrant liabilities are recorded in “change in fair value of warrant liabilities” in the Company’s consolidated statements of operations. The Series A and Series B warrants have been recorded at their fair value using the Black-Scholes valuation model, and will be recorded at their respective fair value at each subsequent balance sheet date. This model incorporates transaction details such as the Company’s stock price, contractual terms, maturity, risk free rates, as well as volatility. The warrants require, at the option of the holder, a net-cash settlement following certain fundamental transactions at the Company or require the issuance of registered shares upon exercise, do not expressly preclude an implied right to cash settlement and are therefore accounted for as derivative liabilities. A summary of quantitative information with respect to the valuation methodology and significant unobservable inputs used for the Company’s warrant liabilities that are categorized within Level 3 of the fair value hierarchy at the date of issuance and as of December 31, 2018 and December 31, 2017 is as follows: Date of valuation December 31, 2018 December 31, 2017 Risk-free interest rate 2.48% 1.98% Expected volatility 72.03% - 103.13% 100.00% - 132.21% Contractual life (in years) 1.94-2.06 2.94 - 3.06 Expected dividend yield — — The risk-free interest rate was based on rates established by the Federal Reserve. For the July 2015 Warrants, the expected volatility in the Black-Scholes model is based on an expected volatility of 100% for both periods which represents the percentage required to be used when valuing the cash settlement feature as contractually stated in the form of warrant. The general expected volatility is based on standard deviation of the Company’s underlying stock price’s daily logarithmic returns. The expected life of the warrants was determined by the expiration date of the warrants. The expected dividend yield was based upon the fact that the Company has not historically paid dividends on its common stock and does not expect to pay dividends on its common stock in the future. The following table sets forth a summary of the changes in the fair value of the Company’s Level 3 financial liabilities that are measured at fair value on a recurring basis for the year ended December 31, 2018 and 2017 ($ in thousands): Fair Value of Level 3 financial liabilities December 31, December 31, 2018 2017 Beginning balance $ 822 $ 702 Fair value adjustment of warrant liabilities (740 ) 120 Ending balance $ 82 $ 822 |
RPX License Agreement
RPX License Agreement | 12 Months Ended |
Dec. 31, 2018 | |
Rpx License Agreement | |
RPX License Agreement | Note 9. RPX License Agreement Under an agreement between the Company and RPX Corporation (“RPX”), the Company granted RPX the ability to grant to VTech Telecommunications Ltd. (“VTech”) a sublicense for a fully paid portfolio license in exchange for an additional $20,000 in cash consideration during the year ended December 31, 2017. The license granted under the terms of the RPX License described herein does not extend to entities/companies that are not clients of RPX and provide chipsets or other hardware to current RPX clients. During the year ended December 31, 2018 and 2017, the Company recorded approximately $0 and $957,000, respectively, in revenue related to the amortization of the license. The Company has determined that its licenses represent functional intellectual property under Topic 606. Therefore, revenue is recognized at the point in time when the customer has the right to use the intellectual property rather than over the license period. Accordingly, the Company’s deferred revenue related to its licenses was eliminated through a debit adjustment in the amount of approximately $3.2 million through the accumulated deficit at the beginning of 2018. The Company will not recognize revenue from the RPX license in the future. |
Stockholders' Equity and Conver
Stockholders' Equity and Convertible Preferred Stock | 12 Months Ended |
Dec. 31, 2018 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity and Convertible Preferred Stock | Note 10. Stockholders’ Equity and Convertible Preferred Stock Common Stock 2017 activity On July 18, 2017, the Company entered into an underwriting agreement with Laidlaw & Company (UK) Ltd. with respect to the issuance and sale of an aggregate of 1,250,000 shares of the Company’s common stock, par value $0.0001 per share, in a firm commitment underwritten public offering which closed on July 24, 2017. Each share was sold for a price of $2.00 for aggregate gross proceeds of $2.5 million, with net proceeds of approximately $2.1 million, after deducting the underwriting discounts and commissions (equivalent to 8% of gross proceeds) and estimated offering expenses. 2018 activity On March 19, 2018, the Company closed a public offering of common stock for gross proceeds of approximately $3.0 million. The offering was a shelf takedown off of the Company’s registration statement on Form S-3 (File No. 333-222488) and was conducted pursuant to a placement agency agreement (the “Agreement”) between the Company and Laidlaw & Company (UK) Ltd., the sole placement agent, on a best-efforts basis with respect to the offering (the “Placement Agent”), that was entered into on March 14, 2018. The Company sold 2,222,222 shares of its common stock in the offering at a purchase price of $1.35 per share. The Company had designated separate series of its capital stock as of December 31, 2018 and December 31, 2017 as summarized below: Number of Shares Issued and Outstanding as of December 31, December 31, Par Value Conversion Ratio Series “A” — — $ 0.0001 N/A Series “C” — — 0.0001 0.05:1 Series “D” 4,725 4,725 0.0001 0.53:1 Series “D-1” 834 834 0.0001 0.53:1 Series “F-1” — — 0.0001 0.05:1 Series “H” — — 0.0001 0.53:1 Series “I” — — 0.0001 1.05:1 Series “J” — — 0.0001 0.05:1 Series “K” — — 0.0001 263.16:1 Series D Convertible Preferred Stock In connection with the acquisition of North South’s patent portfolio in September 2013, the Company issued 1,379,685 shares of its Series D Convertible Preferred Stock (“Series D Preferred Stock”) to the stockholders of North South. Each share of Series D Preferred Stock has a stated value of $0.0001 per share and is convertible into ten-nineteenths of a share of Common Stock. Upon the liquidation, dissolution or winding up of the Company’s business, each holder of Series D Preferred Stock shall be entitled to receive, for each share of Series D Preferred Stock held, a preferential amount in cash equal to the greater of (i) the stated value or (ii) the amount the holder would receive as a holder of Common Stock on an “as converted” basis. Each holder of Series D Preferred Stock shall be entitled to vote on all matters submitted to its stockholders and shall be entitled to such number of votes equal to the number of shares of Common Stock such shares of Series D Preferred Stock are convertible into at such time, taking into account the beneficial ownership limitations set forth in the governing Certificate of Designation and the conversion limitations described below. The conversion ratio of the Series D Preferred Stock is subject to adjustment in the event of stock splits, stock dividends, combination of shares and similar recapitalization transactions. As of December 31, 2018 and 2017, 4,725 shares of Series D Preferred Stock remained issued and outstanding. Series D-1 Convertible Preferred Stock The Company’s Series D-1 Convertible Preferred Stock (“Series D-1 Preferred Stock”) was established on November 22, 2013. Each share of Series D-1 Preferred Stock has a stated value of $0.0001 per share and is convertible into ten- nineteenths of a share of Common Stock. Upon the liquidation, dissolution or winding up of the Company’s business, each holder of Series D-1 Preferred Stock shall be entitled to receive, for each share of Series D-1 Preferred Stock held, a preferential amount in cash equal to the greater of (i) the stated value or (ii) the amount the holder would receive as a holder of Common Stock on an “as converted” basis. Each holder of Series D-1 Preferred Stock shall be entitled to vote on all matters submitted to the Company’s stockholders and shall be entitled to such number of votes equal to the number of shares of Common Stock such shares of Series D-1 Preferred Stock are convertible into at such time, taking into account the beneficial ownership limitations set forth in the governing Certificate of Designation. The conversion ratio of the Series D-1 Preferred Stock is subject to adjustment in the event of stock splits, stock dividends, combination of shares and similar recapitalization transactions. The Company commenced an exchange with holders of Series D Convertible Preferred Stock pursuant to which the holders of the Company’s outstanding shares of Series D Preferred Stock acquired in the Merger could exchange such shares for shares of the Company’s Series D-1 Preferred Stock on a one-for-one basis. As of December 31, 2018 and 2017, 834 shares of Series D-1 Preferred Stock remained issued and outstanding. Warrants A summary of warrant activity for year ended December 31, 2018 and 2017 is presented below: Warrants Weighted Average Exercise Price Total Intrinsic Value Weighted Average Remaining Contractual Life Outstanding as of December 31, 2017 1,249,754 $ 8.98 $ — 2.92 Outstanding as of December 31, 2018 1,249,754 $ 8.98 1.92 Stock Options 2012 Plan At December 31, 2018, there were 521 shares available for grant under the 2012 Equity Incentive Plan. 2013 Plan At December 31, 2018, there were 105,547 fully vested options outstanding and 41,821 shares available for grant under the Spherix Incorporated 2013 Equity Incentive Plan. 2014 Plan and Option Grants At December 31, 2018, there were 422,880 options outstanding and 11,330 shares available for grant under the Spherix Incorporated 2014 Equity Incentive Plan. The fair value of options granted in 2018 and 2017 was estimated using the following assumptions: For the Years Ended December 31, 2018 2017 Exercise price $1.04-$1.50 $ 1.02 Expected stock price volatility 131.8%-132.2% 134.5 % Risk-free rate of interest 2.65%-2.80% 1.4 % Term (years) 9.13-9.34 4.42 A summary of option activity under the Company’s employee stock option plan for year ended December 31, 2018 and 2017 is presented below: Number of Shares Weighted Average Exercise Price Total Intrinsic Value Weighted Average Remaining Contractual Life (in years) Outstanding as of December 31, 2017 325,597 $ 78.20 $ 5,999 3.2 Employee options granted 200,000 1.39 — 9.2 Outstanding as of December 31, 2018 525,597 $ 48.96 $ — 4.9 Options vested and expected to vest 525,534 $ 48.96 $ — 4.9 Options vested and exercisable 500,534 $ 51.35 $ — 4.6 A summary of options that the Company granted to non-employees for the year ended December 31, 2018 and 2017 is presented below: Number of Shares Weighted Average Exercise Price Total Intrinsic Value Weighted Average Remaining Contractual Life (in years) Outstanding as of December 31, 2017 2,893 $ 98.07 $ — 3.4 Outstanding as of December 31, 2018 2,893 $ 98.07 $ — 2.4 Options vested and expected to vest 2,893 $ 98.07 $ — 2.4 Options vested and exercisable 2,893 $ 98.07 $ — 2.4 Stock-based compensation associated with the amortization of stock option expense was $213,000 and $14,000 for the years ended December 31, 2018 and 2017, respectively. Estimated future stock-based compensation expense relating to unvested stock options is approximately $8,000. The weighted average remaining contractual term of exercisable options is approximately 4.8 years at December 31, 2018. Restricted Stock Awards 2017 activity On October 11, 2017, the Company granted a consultant 5,000 shares of restricted common stock for consulting services. The restricted stock award vested immediately. The grant date fair value of restricted stock award was $8,400. 2018 activity During 2018 approximately 84,410 shares with a fair value of approximately $106,000 was granted. These restricted stock awards vested immediately. Restricted Stock Units On March 14, 2017, 35,969 restricted stock units (“RSUs”) were delivered to Anthony Hayes. 23,287 shares of common stock were withheld (at the closing price of the Company’s common stock on the NASDAQ Capital Market on March 14, 2017) to satisfy the tax obligation relating to the vesting of the RSUs. As of December 31, 2018, the Company did not have unrecognized stock-based compensation expense related to restricted stock unit awards. Stock-based Compensation Expense Stock-based compensation expense for the year ended December 31, 2018 and 2017 was comprised of the following ($ in thousands): For the Years Ended December 31, 2018 2017 Employee restricted stock awards $ 107 $ — Non-employee restricted stock awards — 9 Employee stock option awards 213 14 Total compensation expense $ 320 $ 23 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 11. Commitments and Contingencies Financing of Directors’ and Officers’ Insurance The Company financed its Directors’ and Officers’ insurance policy for approximately $0.2 million. Payments are due monthly and the policy is for 12 months. Finance charges for the 12-month period are nominal. As of December 31, 2018, the Company owed approximately $0.1 million and such amounts were recorded in accrued expenses. The Company has made regular payments in accordance with this insurance policy. Legal Proceedings In the ordinary course of business, the Company actively pursues legal remedies to enforce its intellectual property rights and to stop unauthorized use of use technology. From time to time, the Company may be involved in various claims and counterclaims and legal actions arising in the ordinary course of business. There were no pending material claims or legal matters as of the date of this report other than the following matters: International License Exchange of America, LLC Litigations Optic153 LLC Litigations Under our Monetization Agreement with Equitable, Optic 153 LLC, an Equitable subsidiary, has filed the following litigations relating to patents acquired under the terms of settlement of one of our prior litigations: ● On March 15, 2018, litigation against Lumentum Operations LLC, Case No. 1:18-cv-00406-VAC-CJB, in the in the U.S. District Court for the District of Delaware, related to alleged infringement of U.S. Patent No. 6,587,261. Such case settled in November of 2018 and the Company received its pro rata portion of the aggregate settlement amount of $200,000. A Notice of Voluntary Dismissal was filed on November 15, 2018 and the Court closed the case. Counterclaims In the ordinary course of business, we, or with our wholly-owned subsidiaries or monetization partners, will initiate litigation against parties whom we believe have infringed on our intellectual property rights and technologies. The initiation of such litigation exposes us to potential counterclaims initiated by the defendants. Currently, there are no counterclaims pending against us. In the event such counterclaims are filed, we can provide no assurance that the outcome of these claims will not have a material adverse effect on our financial position and results from operations. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 12. Income Taxes The income tax provision consists of the following ($ in thousands): As of December 31, 2018 2017 Federal Current $ — $ — Deferred (477 ) 14,376 Decrease in valuation allowance 477 (14,376 ) State and local Current — — Deferred (92 ) (1,416 ) (Decrease) Increase in valuation allowance 92 1,416 Change in valuation Allowance 569 (12,960 ) Income Tax Provision (Benefit) $ — $ — The following is a reconciliation of the U.S. federal statutory rate to the effective income tax rates for the years ended December 31, 2018 and 2017: For the years ended December 31, 2018 2017 U.S. Statutory Federal Rate 21 % 34 % Federal tax rate change — % (456.08 )% State Taxes, Net of Federal Tax Benefit 3.91 % 2.28 % Other Permanent Differences 1.77 % 3.12 % State rate change in effect — % — % Fair Value of Warrants 8.99 % (1.23 )% Increase due to true up of State NOL — 26.00 Decrease due to change in Federal NOL and other true ups (2.72 %) (0.12 )% Change in Valuation Allowance (32.94 %) 392.03 % Income Tax Provision (Benefit) 0.0 0.0 At December 31, 2018 and 2017, the Company’s deferred tax assets and liabilities consisted of the effects of temporary differences attributable to the following ($ in thousands): As of December 31, 2018 2017 Deferred tax assets: Net-operating loss carryforward $ 12,163 $ 9,608 Stock based compensation 5,444 5,368 Patent portfolio and other 9,183 11,244 Total Deferred Tax assets 26,790 26,220 Valuation allowance (26,790 ) (26,220 ) Deferred Tax Asset, Net of Allowance $ — $ — In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the period in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and taxing strategies in making this assessment. The Company has determined that, based on objective evidence currently available, it is more likely than not the deferred tax assets will not be realized in future periods. Accordingly, the Company has provided a full allowance for the deferred tax assets at December 31, 2018 and 2017. As of December 31, 2018, the change in valuation allowance is approximately $569 thousand. Under the Act, corporations are no longer subject to the Alternative Minimum Tax (AMT), effective for taxable years beginning after Dec. 31, 2017. However, where a corporation has an AMT credit from a prior taxable year, the corporation will continue to carry the credit forward and may use a portion of it as a refundable credit in any taxable year beginning after 2017 but before 2022. Generally, 50 percent of the corporation’s AMT Credit carried forward to one of these years will be claimable and refundable for that year. In tax years beginning in 2021, however, the entire remaining carryforward generally will be refundable. The Company has an AMT credit carryforward of $40,932 as of December, 31, 2018. The Company will request the following refunds for the tax years ended December 31, 2019 through December 31, 2021: Tax Year Ended: AMT Credit Refund Request December 31, 2019 $ 20,466 December 31, 2020 10,233 December 31, 2021 10,233 $ 40,932 On December 22, 2017, “H.R.1”, formerly known as the “Tax Cuts and Jobs Act”, was signed into law. Among other items, H.R.1 reduced the federal corporate tax rate to 21% from the existing maximum rate of 35%, effective January 1, 2018. After the enactment of the Act, the SEC issued Staff Accounting Bulletin No. 118 (“SAB 118”) to address the application of U.S. GAAP in situations when a registrant does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the Act. In our financial statements for the period ended December 31, 2017, we calculated an estimate of the impact of the Act related to the remeasurement of our net U.S. deferred tax asset due to the change in U.S. federal corporate income tax rate. The provisional amount recorded was deferred tax expense of $15.08 million, but which was fully and equally offset by a deferred tax benefit related to a corresponding reduction in our valuation allowance. The Company had previously recorded a valuation allowance against the deferred tax asset so this adjustment had no impact on the financial statements for the period ended December 31, 2017. During the quarter ended December 31, 2018, the completed the accounting for the income tax effects of the Act, which resulted in an in an immaterial change in the net deferred tax asset, before valuation allowance, as of the enactment date. As of December 31, 2018, the Company had federal and state net operating loss carryovers (“NOLs”) of approximately $52.53 million, which expire from 2039 through 2038. The NOL carryover may be subject to limitation under Internal Revenue Code section 382, should there be a greater than 50% ownership change as determined under the regulations. As required by the provisions of ASC 740, the Company recognizes the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the more likely than not threshold, the amount recognized in the consolidated financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. Differences between tax positions taken or expected to be taken in a tax return and the net benefit recognized and measured pursuant to the interpretation are referred to as “unrecognized benefits.” A liability is recognized (or amount of NOL or amount of tax refundable is reduced) for an unrecognized tax benefit because it represents an enterprise’s potential future obligation to the taxing authority for a tax position that was not recognized as a result of applying the provisions of ASC 740. If applicable, interest costs and penalties related to unrecognized tax benefits are required to be calculated and would be classified as interest and penalties in general and administrative expense in the statement of operations. As of December 31, 2018 and 2017, no liability for unrecognized tax benefit was required to be reported. No interest or penalties were recorded during the years ended December 31, 2018 and 2017. The Company does not expect any significant changes in its unrecognized tax benefits in the next year. The Company files U.S. federal and state income tax returns. As of December 31, 2018, the Company’s U.S. and state tax returns (California, Delaware, Maryland, New York, New York City, Virginia, Pennsylvania and Texas) remain subject to examination by tax authorities beginning with the tax return filed for the year ended December 31, 2015, however, there were no audits pending in any of the above-mentioned jurisdictions during 2018. The Company believes that its income tax positions would be sustained upon an audit and does not anticipate any adjustments that would result in material changes to its consolidated financial position. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 13. Subsequent Events The Company evaluates events that have occurred after the balance sheet date but before the consolidated financial statements are issued. Based upon the evaluation, the Company did not identify any recognized or non-recognized subsequent events that would have required adjustment or disclosure in the consolidated financial statements other than disclosed. Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard On January 11, 2019, the Company received written notice (the “Notice”) from the Listing Qualifications Department (the “Staff”) of The NASDAQ Stock Market LLC (“Nasdaq”) indicating that, based upon the Company’s non-compliance with Nasdaq Listing Rule 5620(a), which requires an issuer to hold an annual meeting of shareholders no later than one year after the end of the Company’s fiscal year-end (the “Annual Meeting Rule”), the Company would be required to submit a plan to regain compliance with the Annual Meeting Rule for the Staff’s consideration by no later than February 25, 2019. The Notice has no immediate impact on the Company’s listing or trading in the Company’s securities on Nasdaq. The Company has been provided an extension of up to 180 calendar days from the Company’s fiscal year end, through July 1, 2019, to evidence compliance with the Annual Meeting Rule. As announced to the Company’s stockholders on a Current Report on Form 8-K filed on February 6, 2019, the Company has established April 15, 2019 as the date of the Company’s 2019 annual meeting of stockholders. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Nuta Technology Corp. (“Nuta”), Spherix Portfolio Acquisition II, Inc. (“SPAII”), Guidance IP, LLC (“Guidance”), Directional IP, LLC (“Directional”), Spherix Management Services, LLC (“SMS”), Spherix Delaware Merger Sub Inc. (“Merger Sub”), Spherix Merger Subsidiary, Inc (“SMSI”) and NNPT, LLC (“NNPT”). All significant intercompany balances and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“US GAAP”). This requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the period. The Company’s significant estimates and assumptions include the recoverability and useful lives of long-lived assets, stock-based compensation, the valuation of derivative liabilities, the valuation of investments and the valuation allowance related to the Company’s deferred tax assets. Certain of the Company’s estimates, including the carrying amount of the intangible assets, could be affected by external conditions, including those unique to the Company and general economic conditions. It is reasonably possible that these external factors could have an effect on the Company’s estimates and could cause actual results to differ from those estimates and assumptions. |
Segments | Segments The Company operates in one operating segment and, accordingly, no segment disclosures have been presented herein. |
Concentration of Cash | Concentration of Cash The Company maintains cash balances at two financial institutions in checking accounts and money market accounts. The Company considers all highly liquid investments with original maturities of three months or less when purchased to be cash equivalents. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash. |
Marketable Securities | Marketable Securities Marketable securities are classified as trading and are carried at fair value. The Company’s marketable securities consist of corporate bonds and highly liquid mutual funds and exchange-traded & closed-end funds which are valued at quoted market prices. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Financial instruments, including cash and cash equivalents, accounts payable and accrued liabilities are carried at cost, which management believes approximates fair value due to the short-term nature of these instruments. The Company measures the fair value of financial assets and liabilities based on the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Company maximizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value. The Company uses three levels of inputs that may be used to measure fair value: Level 1 - quoted prices in active markets for identical assets or liabilities Level 2 - quoted prices for similar assets and liabilities in active markets or inputs that are observable Level 3 - inputs that are unobservable (for example, cash flow modeling inputs based on assumptions) |
Property and Equipment | Property and Equipment Property and equipment are stated at cost and include office furniture and equipment and computer hardware and software. The Company computes depreciation and amortization under the straight-line method and typically over the following estimated useful lives of the related assets: ● Office furniture and equipment 3 to 10 years ● Computer hardware and software 3 to 5 years |
Impairment of Long-lived Assets (Including Patent Assets) | Impairment of Long-lived Assets (Including Patent Assets) The Company monitors the carrying value of long-lived assets for potential impairment and tests the recoverability of such assets whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable. If a change in circumstance occurs, the Company performs a test of recoverability by comparing the carrying value of the asset or asset group to its undiscounted expected future cash flows. If cash flows cannot be separately and independently identified for a single asset, the Company will determine whether impairment has occurred for the group of assets for which the Company can identify the projected cash flows. If the carrying values are in excess of undiscounted expected future cash flows, the Company measures any impairment by comparing the fair value of the asset or asset group to its carrying value. The Company performed impairment tests for intangible assets at December 31, 2018 and 2017. An impairment charge of approximately $2.2 million and nil was taken during the year ended December 31, 2018 and 2017, respectively. |
Convertible Preferred Stock | Convertible Preferred Stock The Company applies the accounting standards for distinguishing liabilities from equity when determining the classification and measurement of its preferred stock. Preferred shares subject to mandatory redemption are classified as liability instruments and are measured at fair value. Conditionally redeemable preferred shares (including preferred shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) are classified as temporary equity. At all other times, preferred shares are classified as stockholders’ equity. The Company accounts for convertible preferred stock with detachable warrants in accordance with ASC 470: Debt The Company has also evaluated its convertible preferred stock and warrants in accordance with the provisions of ASC 815, Derivatives and Hedging As the convertible preferred stock may be converted immediately, the Company recognized the BCF as a deemed dividend in the consolidated statements of operations. |
Treasury Stock | Treasury Stock The Company accounts for the treasury stock using the cost method, which treats it as a reduction in stockholders’ equity. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue under ASC 606, Revenue from Contracts with Customers The Company recognizes revenue under ASC 606, Revenue from Contracts with Customers ● Step 1: Identify the contract with the customer ● Step 2: Identify the performance obligations in the contract ● Step 3: Determine the transaction price ● Step 4: Allocate the transaction price to the performance obligations in the contract ● Step 5: Recognize revenue when the company satisfies a performance obligation In order to identify the performance obligations in a contract with a customer, a company must assess the promised goods or services in the contract and identify each promised good or service that is distinct. A performance obligation meets ASC 606’s definition of a “distinct” good or service (or bundle of goods or services) if both of the following criteria are met: ● The customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer (i.e., the good or service is capable of being distinct). ● The entity’s promise to transfer the good or service to the customer is separately identifiable from other promises in the contract (i.e., the promise to transfer the good or service is distinct within the context of the contract). If a good or service is not distinct, the good or service is combined with other promised goods or services until a bundle of goods or services is identified that is distinct. The transaction price is the amount of consideration to which an entity expects to be entitled in exchange for transferring promised goods or services to a customer. The consideration promised in a contract with a customer may include fixed amounts, variable amounts, or both. When determining the transaction price, an entity must consider the effects of all of the following: ● Variable consideration ● Constraining estimates of variable consideration ● The existence of a significant financing component in the contract ● Noncash consideration ● Consideration payable to a customer Variable consideration is included in the transaction price only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. The transaction price is allocated to each performance obligation on a relative standalone selling price basis. The transaction price allocated to each performance obligation is recognized when that performance obligation is satisfied, at a point in time or over time as appropriate. As of December 31, 2018, there were no contract assets or liabilities associated with the Company’s settlement and licensing agreements. During the year ended December 31, 2018, the Company only generated $28 thousand of revenue. |
Inventor Royalties | Inventor Royalties Inventor royalties are expensed in the period that the related revenues are recognized. In certain instances, pursuant to the terms of the underlying inventor agreements, costs paid by the Company to acquire patents are recoverable from future net revenues. Patent acquisition costs that are recoverable from future net revenues are amortized over the estimated economic useful life of the related patents, or as the prepaid royalties are earned by the inventor, as appropriate, and the related expense is included in amortization expense. |
Accounting for Warrants | Accounting for Warrants The Company accounts for the issuance of common stock purchase warrants issued in connection with the equity offerings in accordance with the provisions of ASC 815, Derivatives and Hedging (“ASC 815”). The Company classifies as equity any contracts that (i) require physical settlement or net-share settlement or (ii) gives the Company a choice of net-cash settlement or settlement in its own shares (physical settlement or net-share settlement). The Company classifies as assets or liabilities any contracts that (i) require net-cash settlement (including a requirement to net-cash settle the contract if an event occurs and if that event is outside the control of the Company) or (ii) gives the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement). In addition, Under ASC 815, registered common stock warrants that require the issuance of registered shares upon exercise and do not expressly preclude an implied right to cash settlement are accounted for as derivative liabilities. The Company classifies these derivative warrant liabilities on the consolidated balance sheet as a current liability. The Company assessed the classification of common stock purchase warrants as of the date of each offering and determined that such instruments met the criteria for liability classification. Accordingly, the Company classified the warrants as a liability at their fair value and adjusts the instruments to fair value at each reporting period. This liability is subject to re-measurement at each balance sheet date until the warrants are exercised or expired, and any change in fair value is recognized as “change in the fair value of warrant liabilities” in the consolidated statements of operations. The fair value of the warrants has been estimated using a Black-Scholes valuation model (see Note 8). |
Stock-based Compensation | Stock-based Compensation The Company accounts for share-based payment awards exchanged for employee services at the estimated grant date fair value of the award. Stock options issued under the Company’s long-term incentive plans are granted with an exercise price equal to no less than the market price of the Company’s stock at the date of grant and expire up to ten years from the date of grant. These options generally vest over a one- to five-year period. The fair value of stock options granted was determined on the grant date using assumptions for risk free interest rate, the expected term, expected volatility, and expected dividend yield. The risk-free interest rate is based on U.S. Treasury zero-coupon yield curve over the expected term of the option. The expected term assumption is determined using the weighted average midpoint between vest and expiration for all individuals within the grant. The expected volatility assumption is computed based on the standard deviation of the Company’s underlying stock price’s daily logarithmic returns. The Company’s model includes a zero dividend yield assumption, as the Company has not historically paid nor does it anticipate paying dividends on its common stock. The Company’s model does not include a discount for post-vesting restrictions, as the Company has not issued awards with such restrictions. The periodic expense is then determined based on the valuation of the options, and at that time an estimated forfeiture rate is used to reduce the expense recorded. In addition to the assumptions used in the Black-Scholes option-pricing model, the amount of stock option expense the Company recognizes in the consolidated statements of operations includes an estimate of stock option forfeitures. Under ASC 718, the Company is required to estimate the level of forfeitures expected to occur and record compensation expense only for those awards that ultimately expect will vest. The Company recognizes the effect of forfeitures in compensation expense when the forfeitures occur. |
Income Taxes | Income Taxes The Company uses the asset and liability method of accounting for income taxes in accordance with ASC 740, “Income Taxes” (“ASC 740”). Under this method, income tax expense is recognized as the amount of: (i) taxes payable or refundable for the current year and (ii) deferred tax consequences of temporary difference resulting from matters that have been recognized in the Company’s financial statement or tax returns. Deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities measured at the enacted tax rates in effect for the year in which these items are expected to reverse. Deferred tax assets are reduced by valuation allowances if, based on the consideration of all available evidence, it is more likely than not that some portion or all of the deferred tax asset will not be realized. |
Net Loss Per Share | Net Loss per Share Basic loss per share is computed by dividing the net income or loss applicable to common shares by the weighted average number of common shares outstanding during the period. Net income (loss) attributable to common stockholders includes the effect of the deemed capital contribution on extinguishment of preferred stock and the deemed dividend related to the immediate accretion of beneficial conversion feature of convertible preferred stock. Diluted earnings per share is computed using the weighted average number of common shares and, if dilutive, potential common shares outstanding during the period. Potential common shares consist of the incremental common shares issuable upon the exercise of stock options (using the treasury stock method) and the conversion of the Company’s convertible preferred stock and warrants (using the if-converted method). Diluted loss per share excludes the shares issuable upon the conversion of preferred stock and the exercise of stock options and warrants from the calculation of net loss per share if their effect would be anti-dilutive. The following table summarizes the earnings (loss) per share calculation (in thousands, except per share amount): For the Years Ended December 31, 2018 2017 Basic earnings per share Numerator: Net income (loss) $ 1,727 $ (3,306 ) Net income (loss) available to common stockholders $ 1,727 $ (3,306 ) Denominator: Weighted average number of common shares outstanding, 8,058,165 5,538,568 Earnings per basic share: Net loss 0.21 (0.60 ) Net income (loss) available to common stockholders $ 0.21 $ (0.60 ) Dilutive earnings per share Numerator: Net income (loss) $ 1,727 $ (3,306 ) Net income (loss) available to common stockholders $ 1,727 $ (3,306 ) Denominator: Weighted average basic shares outstanding, 8,058,165 5,538,568 Weighted average effect of dilutive securities Employee stock options — — Convertible preferred stock 2,926 — Weighted average diluted shares outstanding 8,061,091 5,538,568 Earnings per diluted share: Net income (loss) $ 0.21 $ (0.60 ) Net income (loss) available to common stockholders $ 0.21 $ (0.60 ) Securities that could potentially dilute loss per share in the future that were not included in the computation of diluted loss per share at December 31, 2018 and 2017 are as follows: As of December 31, 2018 2017 Convertible preferred stock 2,926 2,926 Warrants to purchase common stock 1,249,754 1,249,754 Options to purchase common stock 528,427 328,490 Total 1,781,107 1,581,170 |
Recently Issued Accounting Standards | Recently Issued Accounting Standards In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) ASU No. 2016-02, Leases (Topic 842) Leases (Topic 840) In July 2017, the FASB issued ASU 2017-11, Earnings Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480) and Derivatives and Hedging (Topic 815): I. Accounting for Certain Financial Instruments with Down Round Features; II. Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception In June 2018, the FASB issued ASU 2018-07, Compensation-Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting In August 2018, the SEC adopted the final rule under SEC Release No. 33-10532, Disclosure Update and Simplification, amending certain disclosure requirements that were redundant, duplicative, overlapping, outdated or superseded. In addition, the amendments expanded the disclosure requirements on the analysis of stockholders’ equity for interim financial statements. Under the amendments, an analysis of changes in each caption of stockholders’ equity presented in the balance sheet must be provided in a note or separate statement. The analysis should present a reconciliation of the beginning balance to the ending balance of each period for which a statement of comprehensive income is required to be filed. This final rule is effective on November 5, 2018. The Company is evaluating the impact of this guidance on its consolidated financial statements. The Company anticipates its first presentation of changes in stockholders’ equity will be included in its Form 10-Q for the quarter ended March 31, 2019. In August 2018, the FASB issued ASU 2018-13, “Fair Value Measurement (Topic 820), - Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement,” which makes a number of changes meant to add, modify or remove certain disclosure requirements associated with the movement amongst or hierarchy associated with Level 1, Level 2 and Level 3 fair value measurements. This guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted upon issuance of the update. The Company does not expect the adoption of this guidance to have a material impact on its consolidated Financial Statements. |
Recently Adopted Accounting Standards | Recently Adopted Accounting Standards In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (ASU 2014-09) as modified by ASU No. 2015-14, “Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date,” ASU 2016-08, “Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net),” ASU No. 2016-10, “Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing,” and ASU No. 2016-12, “Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients.” The revenue recognition principle in ASU 2014-09 is that an entity should recognize revenue to depict the transfer of 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. In addition, new and enhanced disclosures will be required. Companies may adopt the new standard either using the full retrospective approach, a modified retrospective approach with practical expedients, or a cumulative effect upon adoption approach. The Company adopted the new standard effective January 1, 2018, using the modified retrospective approach. The Company has determined that its licenses represent functional intellectual property under Topic 606. Therefore, revenue is recognized at the point in time when the customer has the right to use the intellectual property rather than over the license period. Accordingly, the Company’s deferred revenue related to its licenses was eliminated and accumulated deficit as of January 1, 2018 was decreased by approximately $3.2 million so that the Company will not recognize revenue on earnings statements in the future as to its license. Absent the adoption of ASC 606, the Company would have recorded approximately $1.0 million of deferred revenue for the year ended December 31, 2018. In January 2016, the FASB issued ASU No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities In May 2017, the Financial Accounting Standards Board (the FASB) issued ASU 2017-09, Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting |
Organization and Description _2
Organization and Description of Business (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Organization And Description Of Business | |
Schedule of breakdown of investment at datchat | The breakdown of investment at Datchat as December 31, 2018 are as follows ($ in thousands): DatChat Cash Payment $ 500 Prior Incurred Amount Made to DatChat 293 Payable to DatChat 207 Total 1,000 |
Schedule of breakdown of mellow scooters | The breakdown of investment at Mellow Scooters as December 31, 2018 are as follows ($ in thousands): Mellow Scooters Cash Payment $ 30 Prior Incurred Amount Made to Mellow Scooters 74 Payable to Mellow Scooters 2 Total 106 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Schedule of estimated useful lives | Property and equipment are stated at cost and include office furniture and equipment and computer hardware and software. The Company computes depreciation and amortization under the straight-line method and typically over the following estimated useful lives of the related assets: ● Office furniture and equipment 3 to 10 years ● Computer hardware and software 3 to 5 years |
Schedule of earnings (loss) per share | The following table summarizes the earnings (loss) per share calculation (in thousands, except per share amount): For the Years Ended December 31, 2018 2017 Basic earnings per share Numerator: Net income (loss) $ 1,727 $ (3,306 ) Net income (loss) available to common stockholders $ 1,727 $ (3,306 ) Denominator: Weighted average number of common shares outstanding, 8,058,165 5,538,568 Earnings per basic share: Net loss 0.21 (0.60 ) Net income (loss) available to common stockholders $ 0.21 $ (0.60 ) Dilutive earnings per share Numerator: Net income (loss) $ 1,727 $ (3,306 ) Net income (loss) available to common stockholders $ 1,727 $ (3,306 ) Denominator: Weighted average basic shares outstanding, 8,058,165 5,538,568 Weighted average effect of dilutive securities Employee stock options — — Convertible preferred stock 2,926 — Weighted average diluted shares outstanding 8,061,091 5,538,568 Earnings per diluted share: Net income (loss) $ 0.21 $ (0.60 ) Net income (loss) available to common stockholders $ 0.21 $ (0.60 ) |
Schedule of potentially dilute loss per share | Securities that could potentially dilute loss per share in the future that were not included in the computation of diluted loss per share at December 31, 2018 and 2017 are as follows: As of December 31, 2018 2017 Convertible preferred stock 2,926 2,926 Warrants to purchase common stock 1,249,754 1,249,754 Options to purchase common stock 528,427 328,490 Total 1,781,107 1,581,170 |
Investments in Marketable Sec_2
Investments in Marketable Securities (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Investments In Marketable Securities Tables Abstract | |
Schedule of marketable securities | The realized gain or loss, unrealized gain or loss, and dividend income related to marketable securities for the year ended December 31, 2018 and 2017 are as follows ($ in thousands): For the Years Ended December 31, 2018 2017 Realized gain (loss) $ (400 ) $ (328 ) Unrealized gain (loss) (117 ) 240 Dividend income 158 111 $ (359 ) $ 23 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible assets | The net carrying amounts related to acquired intangible assets are as follows ($ in thousands): Net Carrying Amount Weighted average Patent Portfolios and Patent Rights at December 31, 2016, net $ 4,951 3.65 Amortization expenses (1,373 ) Patent Portfolios and Patent Rights at December 31, 2017, net $ 3,578 2.67 Amortization expenses (1,405 ) Impairment loss (2,173 ) Patent Portfolios and Patent Rights at December 31, 2018, net $ — — |
Fair Value of Financial Asset_2
Fair Value of Financial Assets and Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Schedule of fair value assets and liabilities | The following table presents the Company’s assets and liabilities that are measured at fair value at December 31, 2018 and 2017 ($ in thousands): Fair value measured at December 31, 2018 Quoted prices in Significant other Significant Total at December 31, active markets observable inputs unobservable inputs 2018 (Level 1) (Level 2) (Level 3) Assets Marketable securities - exchange traded funds $ 2,700 $ 2,700 $ — $ — Investments at Hoth $ 9,214 $ — $ — $ 9,214 Investments at DatChat $ 1,000 $ — $ — $ 1,000 Other investments $ 131 $ — $ — $ 131 Liabilities Fair value of warrant liabilities $ 82 $ — $ — $ 82 Fair value measured at December 31, 2017 Total carrying value at December 31, Quoted prices in active markets Significant other observable inputs Significant unobservable inputs 2017 (Level 1) (Level 2) (Level 3) Assets Marketable securities - mutual and exchange traded funds $ 3,998 $ 976 $ 3022 $ — Investments at Hoth $ 1,020 $ — $ — $ 1,020 Liabilities Fair value of warrant liabilities $ 822 $ — $ — $ 822 |
Schedule of fair value of the Company's Level 3 financial assets | The following table sets forth a summary of the changes in the fair value of the Company’s Level 3 financial assets that are measured at fair value on a recurring basis: Fair Value of Level 3 investment December 31, December 31, 2018 2017 Beginning balance $ 1,020 $ — Purchase of other investments at fair value 131 — Purchase of investment in DatChat at fair value 1,000 — Fair value of Hoth upon issuance — 675 Change in fair value of Hoth 8,194 345 Ending balance $ 10,345 $ 1,020 |
Schedule of hierarchy for nonfinancial assets measured at fair value on a non-recurring basis | The following tables presents the Company’s hierarchy for nonfinancial assets measured at fair value on a non-recurring basis (in thousands): Impairment Charges - Net Carrying Value at Year Ended December December 31, 2018 31, 2018 Assets Patent Portfolios, Net $ — $ 2,173 Impairment Charges - Net Carrying Value at Year Ended December December 31, 2017 31, 2017 Assets Patent Portfolios, Net $ 3,578 $ — |
Schedule of fair value assumptions | A summary of quantitative information with respect to the valuation methodology and significant unobservable inputs used for the Company’s warrant liabilities that are categorized within Level 3 of the fair value hierarchy at the date of issuance and as of December 31, 2018 and December 31, 2017 is as follows: Date of valuation December 31, 2018 December 31, 2017 Risk-free interest rate 2.48% 1.98% Expected volatility 72.03% - 103.13% 100.00% - 132.21% Contractual life (in years) 1.94-2.06 2.94 - 3.06 Expected dividend yield — — A summary of quantitative information with respect to the valuation methodology and significant unobservable inputs used for the Company’s valuation in Hoth that are categorized within Level 3 of the fair value hierarchy at the date of issuance and as of December 31, 2018 and 2017 is as follows: Date of valuation December 31, 2018 December 31, 2017 Risk-free interest rate 2.45 % 1.83 % Expected volatility 75.00 % 75.00 % Contractual life (in years) 0.17 1.50 |
Schedule of fair value of the company's level 3 financial liabilities | The following table sets forth a summary of the changes in the fair value of the Company’s Level 3 financial liabilities that are measured at fair value on a recurring basis for the year ended December 31, 2018 and 2017 ($ in thousands): Fair Value of Level 3 financial liabilities December 31, December 31, Beginning balance $ 822 $ 702 Fair value adjustment of warrant liabilities (740 ) 120 Ending balance $ 82 $ 822 |
Stockholders' Equity and Conv_2
Stockholders' Equity and Convertible Preferred Stock (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Stockholders' Equity Note [Abstract] | |
Schedule of designated separate series of capital stock | The Company had designated separate series of its capital stock as of December 31, 2018 and December 31, 2017 as summarized below: Number of Shares Issued and Outstanding as of December 31, December 31, Par Value Conversion Ratio Series “A” — — $ 0.0001 N/A Series “C” — — 0.0001 0.05:1 Series “D” 4,725 4,725 0.0001 0.53:1 Series “D-1” 834 834 0.0001 0.53:1 Series “F-1” — — 0.0001 0.05:1 Series “H” — — 0.0001 0.53:1 Series “I” — — 0.0001 1.05:1 Series “J” — — 0.0001 0.05:1 Series “K” — — 0.0001 263.16:1 |
Schedule of warrant activity | A summary of warrant activity for year ended December 31, 2018 and 2017 is presented below: Warrants Weighted Average Exercise Price Total Intrinsic Value Weighted Average Remaining Contractual Life Outstanding as of December 31, 2017 1,249,754 $ 8.98 $ — 2.92 Outstanding as of December 31, 2018 1,249,754 $ 8.98 1.92 |
Schedule of fair value of options granted | The fair value of options granted in 2018 and 2017 was estimated using the following assumptions: For the Years Ended December 31, 2018 2017 Exercise price $1.04-$1.50 $ 1.02 Expected stock price volatility 131.8%-132.2% 134.5 % Risk-free rate of interest 2.65%-2.80% 1.4 % Term (years) 9.13-9.34 4.42 |
Schedule of option activity | A summary of option activity under the Company’s employee stock option plan for year ended December 31, 2018 and 2017 is presented below: Number of Shares Weighted Average Exercise Price Total Intrinsic Value Weighted Average Remaining Contractual Life (in years) Outstanding as of December 31, 2017 325,597 $ 78.20 $ 5,999 3.2 Employee options granted 200,000 1.39 — 9.2 Outstanding as of December 31, 2018 525,597 $ 48.96 $ — 4.9 Options vested and expected to vest 525,534 $ 48.96 $ — 4.9 Options vested and exercisable 500,534 $ 51.35 $ — 4.6 A summary of options that the Company granted to non-employees for the year ended December 31, 2018 and 2017 is presented below: Number of Shares Weighted Average Exercise Price Total Intrinsic Value Weighted Average Remaining Contractual Life (in years) Outstanding as of December 31, 2017 2,893 $ 98.07 $ — 3.4 Outstanding as of December 31, 2018 2,893 $ 98.07 $ — 2.4 Options vested and expected to vest 2,893 $ 98.07 $ — 2.4 Options vested and exercisable 2,893 $ 98.07 $ — 2.4 |
Schedule of stock-based compensation | Stock-based compensation expense for the year ended December 31, 2018 and 2017 was comprised of the following ($ in thousands): For the Years Ended December 31, 2018 2017 Employee restricted stock awards $ 107 $ — Non-employee restricted stock awards — 9 Employee stock option awards 213 14 Total compensation expense $ 320 $ 23 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income tax provision | The income tax provision consists of the following ($ in thousands): As of December 31, 2018 2017 Federal Current $ — $ — Deferred (477 ) 14,376 Decrease in valuation allowance 477 (14,376 ) State and local Current — — Deferred (92 ) (1,416 ) (Decrease) Increase in valuation allowance 92 1,416 Change in valuation Allowance 569 (12,960 ) Income Tax Provision (Benefit) $ — $ — |
Schedule of Reconciliation of the expected tax expense (benefit) | The following is a reconciliation of the U.S. federal statutory rate to the effective income tax rates for the years ended December 31, 2018 and 2017: For the years ended December 31, 2018 2017 U.S. Statutory Federal Rate 21 % 34 % Federal tax rate change — % (456.08 )% State Taxes, Net of Federal Tax Benefit 3.91 % 2.28 % Other Permanent Differences 1.77 % 3.12 % State rate change in effect — % — % Fair Value of Warrants 8.99 % (1.23 )% Increase due to true up of State NOL — 26.00 Decrease due to change in Federal NOL and other true ups (2.72 %) (0.12 )% Change in Valuation Allowance (32.94 %) 392.03 % Income Tax Provision (Benefit) 0.0 0.0 |
Schedule of deferred tax assets and liabilities | At December 31, 2018 and 2017, the Company’s deferred tax assets and liabilities consisted of the effects of temporary differences attributable to the following ($ in thousands): As of December 31, 2018 2017 Deferred tax assets: Net-operating loss carryforward $ 12,163 $ 9,608 Stock based compensation 5,444 5,368 Patent portfolio and other 9,183 11,244 Total Deferred Tax assets 26,790 26,220 Valuation allowance (26,790 ) (26,220 ) Deferred Tax Asset, Net of Allowance $ — $ — |
Schedule of refunds for the tax | The Company will request the following refunds for the tax years ended December 31, 2019 through December 31, 2021: Tax Year Ended: AMT Credit Refund Request December 31, 2019 $ 20,466 December 31, 2020 10,233 December 31, 2021 10,233 $ 40,932 |
Organization and Description _3
Organization and Description of Business (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Total | $ 10,345 | $ 1,020 |
DatChat, Inc [Member] | Securities Purchase Agreement [Member] | ||
Cash Payment | 500 | |
Prior Incurred Amount | 293 | |
Payable | 207 | |
Total | 1,000 | |
Mellow Scooters, LLC [Member] | Securities Purchase Agreement [Member] | ||
Cash Payment | 30 | |
Prior Incurred Amount | 74 | |
Payable | $ 2 |
Organization and Description _4
Organization and Description of Business (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | Oct. 10, 2018 | Dec. 31, 2018 | Dec. 31, 2017 |
Investment | $ 10,345 | $ 1,020 | |
Professional fees | 1,569 | $ 1,038 | |
Escrow Agreement [Member] | |||
Description of merger consideration | The Company shall deposit with the Escrow Agent 1,500,000 shares from the Stockholder Merger Consideration otherwise deliverable to the stockholders of CBM who own beneficially and of record greater than 10% of the CBM common stock issued and outstanding immediately prior to the Closing | ||
Description of agreement termination terms | The Company may be required to deliver to CBM certificate(s) representing an aggregate of 400,000 shares of the Company’s Common Stock within two (2) business days of termination. | ||
DatChat, Inc [Member] | Securities Purchase Agreement [Member] | |||
Investment | 1,000 | ||
Cash payment | 500 | ||
Advances towards investment | 293 | ||
Compensation related costs | 272 | ||
Professional fees | 21 | ||
Compensation expenses payable | 207 | ||
DatChat, Inc [Member] | Securities Purchase Agreement [Member] | Maximum [Member] | |||
Advances towards investment | 500 | ||
Mellow Scooters, LLC [Member] | Securities Purchase Agreement [Member] | |||
Cash payment | 30 | ||
Advances towards investment | 74 | ||
Compensation related costs | 71 | ||
Professional fees | 3,500 | ||
Compensation expenses payable | $ 2 | ||
Description of equity interest issued | Sell 250 Units to the Company, representing 25% of its issued and outstanding limited liability company membership interests | ||
Mellow Scooters, LLC [Member] | Securities Purchase Agreement [Member] | Maximum [Member] | |||
Advances towards investment | $ 76 | ||
CBM Biopharma, Inc [Member] | Merger Agreement [Member] | |||
Common stock share issued | 15,000,000 | ||
Common stock value (in dollars per share) | $ 1.10 |
Liquidity and Financial Condi_2
Liquidity and Financial Condition (Details Narrative) $ in Thousands | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Liquidity And Financial Condition | |
Working capital deficit | $ 1,800 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Office furniture and equipment [Member] | Maximum [Member] | |
Property and equipment useful life | 10 years |
Office furniture and equipment [Member] | Minimum [Member] | |
Property and equipment useful life | 3 years |
Computer hardware and software [Member] | Maximum [Member] | |
Property and equipment useful life | 5 years |
Computer hardware and software [Member] | Minimum [Member] | |
Property and equipment useful life | 3 years |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Details 1) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Numerator: | ||
Net income (loss) | $ 1,727 | $ (3,306) |
Net income (loss) available to common stockholders | $ 1,727 | $ (3,306) |
Denominator: | ||
Weighted average number of common shares outstanding, | 8,058,165 | 5,538,568 |
Earnings per basic share: | ||
Net loss | $ 0.21 | $ (0.60) |
Net (loss) income available to common stockholders | $ 0.21 | $ (0.60) |
Numerator: | ||
Net income (loss) | $ 1,727 | $ (3,306) |
Net income (loss) available to common stockholders | $ 1,727 | $ (3,306) |
Denominator: | ||
Weighted average basic shares outstanding, | 8,058,165 | 5,538,568 |
Weighted average effect of dilutive securities | ||
Employee stock options | ||
Convertible preferred stock | 2,926 | |
Weighted average diluted shares outstanding | 8,061,091 | 5,538,568 |
Earnings per diluted share: | ||
Net income (loss) | $ 0.21 | $ (0.60) |
Net income (loss) available to common stockholders | $ 0.21 | $ (0.60) |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies (Details 2) - shares | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Potentially dilute securities excluded from calculation | 1,781,107 | 1,581,170 |
Convertible preferred stock [Member] | ||
Potentially dilute securities excluded from calculation | 2,926 | 2,926 |
Warrants to purchase common stock [Member] | ||
Potentially dilute securities excluded from calculation | 1,249,754 | 1,249,754 |
Options to purchase common stock [Member] | ||
Potentially dilute securities excluded from calculation | 528,427 | 328,490 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies (Details Narrative) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018USD ($)Number | Dec. 31, 2017USD ($) | Jan. 02, 2018USD ($) | Dec. 31, 2016USD ($) | |
Accounting Policies [Abstract] | ||||
Number of operating segment | Number | 1 | |||
Cash and cash equivalents | $ 200 | $ 100 | ||
Additional intangible assets impairment charges | $ 2,200 | 2,200 | ||
Accumulated deficit | (140,083) | (145,055) | $ 3,200 | |
Revenues | 28 | $ 1,236 | ||
Deferred revenue | $ 1,000 |
Investments in Marketable Sec_3
Investments in Marketable Securities (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Investments In Marketable Securities Details Narrative Abstract | ||
Realized gain (loss) | $ (400) | $ (328) |
Unrealized gain (loss) | (117) | 240 |
Dividend income | 158 | 111 |
Total Marketable Securities | $ (359) | $ 23 |
Investment in Hoth Therapeuti_2
Investment in Hoth Therapeutics, Inc (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | Feb. 15, 2019 | Jun. 30, 2017 | Dec. 31, 2018 |
IPO [Member] | Common Stock [Member] | Subsequent Event [Member] | |||
Sale of stock, number of shares issue | 1,250,000 | ||
Sale of stock, price per share (in dollars per share) | $ 5.60 | ||
Hoth Therapeutics, Inc [Member] | Securities Purchase Agreement [Member] | |||
Share price (in dollars per share) | $ 0.0001 | ||
Number of common shares issued | 1,700,000 | ||
Purchase price | $ 675 |
Investment in DatChat Inc (Deta
Investment in DatChat Inc (Details Narrative) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Investment | $ 10,345 | $ 1,020 |
DatChat, Inc [Member] | Securities Purchase Agreement [Member] | ||
Investment | $ 1,000 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Finite-lived Intangible Assets [Roll Forward] | |||
Patent Portfolios and Patent Rights at beginning | $ 3,578 | ||
Impairment loss | (2,173) | ||
Patent Portfolios and Patent Rights at ending | 3,578 | ||
Patents [Member] | |||
Finite-lived Intangible Assets [Roll Forward] | |||
Patent Portfolios and Patent Rights at beginning | 3,578 | ||
Amortization expenses | (1,405) | (1,373) | |
Impairment loss | (2,173) | ||
Patent Portfolios and Patent Rights at ending | $ 3,578 | ||
Weighted average amortization period (years) | 2 years 8 months 1 day | 3 years 7 months 24 days |
Intangible Assets (Details Narr
Intangible Assets (Details Narrative) $ in Thousands | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Impairment charge of patent portfolio | $ 2,200 |
Fair Value of Financial Asset_3
Fair Value of Financial Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Assets | |||
Marketable securities - mutual and exchange traded funds | $ 2,700 | $ 3,998 | |
Investments at fair value | 10,345 | 1,020 | |
Liabilities | |||
Fair value of warrant liabilities | 82 | 822 | |
Quoted prices in active markets (Level 1) [Member] | |||
Assets | |||
Marketable securities - mutual and exchange traded funds | 2,700 | 976 | |
Investments at fair value | |||
Liabilities | |||
Fair value of warrant liabilities | |||
Significant other observable inputs (Level 2) [Member] | |||
Assets | |||
Marketable securities - mutual and exchange traded funds | 3,022 | ||
Investments at fair value | |||
Liabilities | |||
Fair value of warrant liabilities | |||
Significant unobservable inputs (Level 3) [Member] | |||
Assets | |||
Marketable securities - mutual and exchange traded funds | |||
Investments at fair value | 10,345 | 1,020 | |
Liabilities | |||
Fair value of warrant liabilities | 822 | ||
Hoth [Member] | |||
Assets | |||
Investments at fair value | 9,214 | 1,020 | |
Hoth [Member] | Significant unobservable inputs (Level 3) [Member] | |||
Assets | |||
Investments at fair value | 9,214 | $ 1,020 | |
DatChat [Member] | |||
Assets | |||
Investments at fair value | 1,000 | ||
DatChat [Member] | Significant unobservable inputs (Level 3) [Member] | |||
Assets | |||
Investments at fair value | 1,000 | ||
Other investments [Member] | |||
Assets | |||
Investments at fair value | 131 | ||
Other investments [Member] | Significant unobservable inputs (Level 3) [Member] | |||
Assets | |||
Investments at fair value | 131 | ||
Liabilities | |||
Fair value of warrant liabilities | $ 82 |
Fair Value of Financial Asset_4
Fair Value of Financial Assets and Liabilities (Details 1) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Beginning balance | $ 1,020 | |
Purchase of other investments at fair value | 8,194 | $ 345 |
Ending balance | 10,345 | 1,020 |
Significant unobservable inputs (Level 3) [Member] | ||
Beginning balance | 1,020 | |
Purchase of other investments at fair value | 131 | |
Purchase of investment in DatChat at fair value | 1,000 | |
Fair value of Hoth upon issuance | 675 | |
Change in fair value of Hoth | 8,194 | 345 |
Ending balance | $ 10,345 | $ 1,020 |
Fair Value of Financial Asset_5
Fair Value of Financial Assets and Liabilities (Details 2) - Number | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Risk Free Interest Rate [Member] | ||
Measurement input | 0.0248 | 0.0198 |
Expected Volatility [Member] | ||
Measurement input | 0.7500 | 0.7500 |
Expected Term [Member] | ||
Contractual life (in years) | 2 months 1 day | 1 year 6 months |
Fair Value of Financial Asset_6
Fair Value of Financial Assets and Liabilities (Details 3) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Finite-lived Intangible Assets [Roll Forward] | |||
Net carrying value Patent Portfolios, Net | $ 3,578 | ||
Patent Portfolios, net impairment charges | 2,173 | ||
Patents [Member] | |||
Finite-lived Intangible Assets [Roll Forward] | |||
Net carrying value Patent Portfolios, Net | $ 3,578 | ||
Amortization expenses | (1,405) | (1,373) | |
Patent Portfolios, net impairment charges | $ 2,173 |
Fair Value of Financial Asset_7
Fair Value of Financial Assets and Liabilities (Details 4) - Number | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Risk Free Interest Rate [Member] | ||
Measurement input | 0.0248 | 0.0198 |
Expected Volatility [Member] | ||
Measurement input | 0.7500 | 0.7500 |
Expected Volatility [Member] | Minimum [Member] | ||
Measurement input | 0.7203 | 1 |
Expected Volatility [Member] | Maximum [Member] | ||
Measurement input | 1.0313 | 1.3221 |
Expected Term [Member] | ||
Contractual life (in years) | 2 months 1 day | 1 year 6 months |
Expected Term [Member] | Minimum [Member] | ||
Contractual life (in years) | 1 year 11 months 8 days | 2 years 11 months 8 days |
Expected Term [Member] | Maximum [Member] | ||
Contractual life (in years) | 2 years 22 days | 3 years 22 days |
Fair Value of Financial Asset_8
Fair Value of Financial Assets and Liabilities (Details 5) - Significant unobservable inputs (Level 3) [Member] - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Beginning balance | $ 822 | $ 702 |
Fair value adjustment of warrant liabilities | (740) | 120 |
Ending balance | $ 82 | $ 822 |
Fair Value of Financial Asset_9
Fair Value of Financial Assets and Liabilities (Details Narrative) | 12 Months Ended | |
Dec. 31, 2018Number | Dec. 31, 2017Number | |
Risk-Adjusted Discount Rate [Member] | ||
Measurement input | 0.0248 | 0.0198 |
Expected Volatility [Member] | ||
Measurement input | 0.7500 | 0.7500 |
Expected Volatility [Member] | Minimum [Member] | ||
Measurement input | 0.7203 | 1 |
Expected Volatility [Member] | Maximum [Member] | ||
Measurement input | 1.0313 | 1.3221 |
Expected Term [Member] | ||
Contractual life (in years) | 2 months 1 day | 1 year 6 months |
Expected Term [Member] | Minimum [Member] | ||
Contractual life (in years) | 1 year 11 months 8 days | 2 years 11 months 8 days |
Expected Term [Member] | Maximum [Member] | ||
Contractual life (in years) | 2 years 22 days | 3 years 22 days |
Hoth Therapeutics, Inc [Member] | ||
Percentage of equity aquired | 34.00% | 37.00% |
Hoth Therapeutics, Inc [Member] | Share Price [Member] | ||
Measurement input | 6.50 | 5.50 |
Hoth Therapeutics, Inc [Member] | Risk-Adjusted Discount Rate [Member] | ||
Measurement input | 0.15 | 0.15 |
Hoth Therapeutics, Inc [Member] | Probability Interest Rate [Member] | Minimum [Member] | ||
Measurement input | 0.10 | |
Hoth Therapeutics, Inc [Member] | Probability Interest Rate [Member] | Maximum [Member] | ||
Measurement input | 0.90 | |
Hoth Therapeutics, Inc [Member] | Expected Volatility [Member] | ||
Measurement input | 0.75 | |
Hoth Therapeutics, Inc [Member] | Expected Term [Member] | ||
Contractual life (in years) | 1 year |
RPX License Agreement (Details
RPX License Agreement (Details Narative) - RPX Corporation [Member] - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Series ''H' [Member'] | License [Member] | ||
Revenue | $ 0 | $ 957 |
Patent License Agreement [Member] | ||
Cash to acquire business | $ 20 |
Stockholders' Equity and Conv_3
Stockholders' Equity and Convertible Preferred Stock (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Series A [Member] | ||
Preferred stock, issued | ||
Preferred stock,outstandig | ||
Preferred stock, par value (in dolars per share) | $ 0.0001 | $ 0.0001 |
Series "C" [Member] | ||
Preferred stock, issued | ||
Preferred stock,outstandig | ||
Preferred stock, par value (in dolars per share) | $ 0.0001 | $ 0.0001 |
Conversion Ratio | 0.05:1 | |
Series "D" [Member] | ||
Preferred stock, issued | 4,725 | 4,725 |
Preferred stock,outstandig | 4,725 | 4,725 |
Preferred stock, par value (in dolars per share) | $ 0.0001 | $ 0.0001 |
Conversion Ratio | 0.53:1 | |
Series "D-1" [Member] | ||
Preferred stock, issued | 834 | 834 |
Preferred stock,outstandig | 834 | 834 |
Preferred stock, par value (in dolars per share) | $ 0.0001 | $ 0.0001 |
Conversion Ratio | 0.53:1 | |
Series "F-1" [Member] | ||
Preferred stock, issued | ||
Preferred stock,outstandig | ||
Preferred stock, par value (in dolars per share) | $ 0.0001 | $ 0.0001 |
Conversion Ratio | 0.05:1 | |
Series ''H' [Member'] | ||
Preferred stock, issued | ||
Preferred stock,outstandig | ||
Preferred stock, par value (in dolars per share) | $ 0.0001 | $ 0.0001 |
Conversion Ratio | 0.53:1 | |
Series "I" [Member] | ||
Preferred stock, issued | ||
Preferred stock,outstandig | ||
Preferred stock, par value (in dolars per share) | $ 0.0001 | $ 0.0001 |
Conversion Ratio | 1.05:1 | |
Series "J" [Member] | ||
Preferred stock, issued | ||
Preferred stock,outstandig | ||
Preferred stock, par value (in dolars per share) | $ 0.0001 | $ 0.0001 |
Conversion Ratio | 0.05:1 | |
Series K Convertible Preferred Stock [Member] | ||
Preferred stock, issued | ||
Preferred stock,outstandig | ||
Preferred stock, par value (in dolars per share) | $ 0.0001 | $ 0.0001 |
Conversion Ratio | 263.16:1 |
Stockholders' Equity and Conv_4
Stockholders' Equity and Convertible Preferred Stock (Details 1) | 12 Months Ended |
Dec. 31, 2018$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Weighted Average Remaining Contractual Life [Roll Forward] | |
Exercisable at ending | 4 years 9 months 18 days |
Warrant [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Outstanding [Roll Forward] | |
Outstanding at beginnning | shares | 1,249,754 |
Expired | shares | |
Outstanding at ending | shares | 1,249,754 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward] | |
Beginnning balance | $ / shares | $ 8.98 |
Expired | $ / shares | |
Exercisable at ending | $ / shares | $ 8.98 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Weighted Average Remaining Contractual Life [Roll Forward] | |
Outstanding at ending | 2 years 11 months 1 day |
Exercisable at ending | 1 year 11 months 1 day |
Stockholders' Equity and Conv_5
Stockholders' Equity and Convertible Preferred Stock (Details 2) - Stock Option [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Exercise price | $ 1.02 | |
Expected stock price volatility | 134.50% | |
Risk-free rate of interest | 1.40% | |
Term (years) | 4 years 5 months 1 day | |
Minimum [Member] | ||
Exercise price | $ 1.04 | |
Expected stock price volatility | 131.80% | |
Risk-free rate of interest | 2.65% | |
Term (years) | 9 years 1 month 17 days | |
Maximum [Member] | ||
Exercise price | $ 1.50 | |
Expected stock price volatility | 132.20% | |
Risk-free rate of interest | 2.80% | |
Term (years) | 9 years 4 months 2 days |
Stockholders' Equity and Conv_6
Stockholders' Equity and Convertible Preferred Stock (Details 3) - Stock Option [Member] $ / shares in Units, $ in Thousands | 12 Months Ended |
Dec. 31, 2018USD ($)$ / sharesshares | |
Employee [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number of Shares [Roll Forward] | |
Outstanding at beginning | shares | 325,597 |
Employee options granted | shares | 200,000 |
Outstanding at ending | shares | 525,597 |
Options vested and expected to vest | shares | 525,534 |
Options vested and exercisable | shares | 500,534 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Roll Forward] | |
Outstanding at beginning | $ 78.20 |
Employee options granted | 1.39 |
Employee options expired | |
Outstanding at ending | 48.96 |
Options vested and expected to vest | 48.96 |
Options vested and exercisable | $ 51.35 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Total Intrinsic Value [Roll Forward] | |
Outstanding at beginning | $ | $ 5,999 |
Employee options expired | $ | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Weighted Average Remaining Contractual Life [Roll Forward] | |
Outstanding at beginning | 3 years 2 months 12 days |
Employee options granted | 9 years 2 months 12 days |
Outstanding at ending | 4 years 10 months 24 days |
Options vested and expected to vest | 4 years 10 months 24 days |
Options vested and exercisable | 4 years 7 months 6 days |
Non - Employee [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number of Shares [Roll Forward] | |
Outstanding at beginning | shares | 2,893 |
Employee options granted | shares | |
Outstanding at ending | shares | 2,893 |
Options vested and expected to vest | shares | 2,893 |
Options vested and exercisable | shares | 2,893 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Roll Forward] | |
Outstanding at beginning | $ 98.07 |
Employee options expired | |
Outstanding at ending | 98.07 |
Options vested and expected to vest | 98.07 |
Options vested and exercisable | $ 98.07 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Total Intrinsic Value [Roll Forward] | |
Outstanding at beginning | $ | |
Employee options expired | $ | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Weighted Average Remaining Contractual Life [Roll Forward] | |
Outstanding at beginning | 3 years 4 months 24 days |
Outstanding at ending | 2 years 4 months 24 days |
Options vested and expected to vest | 2 years 4 months 24 days |
Options vested and exercisable | 2 years 4 months 24 days |
Stockholders' Equity and Conv_7
Stockholders' Equity and Convertible Preferred Stock (Details 4) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Total compensation expense | $ 320 | $ 23 |
Stock Option [Member] | Employee [Member] | ||
Total compensation expense | 213 | 14 |
Restricted Stock [Member] | Non-Employee [Member] | ||
Total compensation expense | 9 | |
Restricted Stock Units [Member] | Employee [Member] | ||
Total compensation expense | $ 107 |
Stockholders' Equity and Conv_8
Stockholders' Equity and Convertible Preferred Stock (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | Mar. 19, 2018 | Jul. 18, 2017 | Dec. 31, 2018 | Dec. 31, 2017 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | ||
Net proceeds from shares | $ 2,700 | $ 2,095 | ||
IPO [Member] | ||||
Number of shares issued | 2,222,222 | |||
Shares issued price per share (in dollars per share) | $ 1.35 | |||
Net proceeds from issuance of stock | $ 3,000 | |||
Underwriting Agreement [Member] | Laidlaw & Company (UK) Ltd. [Member] | ||||
Common stock, par value (in dollars per share) | $ 0.0001 | |||
Shares issued price per share (in dollars per share) | $ 2 | |||
Underwriting Agreement [Member] | Laidlaw & Company (UK) Ltd. [Member] | ||||
Number of shares issued | 1,250,000 | |||
Gross proceeds from shares | $ 2,500 | |||
Net proceeds from shares | $ 2,100 |
Stockholders' Equity and Conv_9
Stockholders' Equity and Convertible Preferred Stock (Details Narrative 1) - $ / shares | Nov. 22, 2013 | Sep. 30, 2013 | Dec. 31, 2018 | Dec. 31, 2017 |
Series D-1 Convertible Preferred Stock [Member] | ||||
Preferred stock, par value (in dollars per share) | $ 0.0001 | |||
Description of stock conversion terms | Convertible into ten- nineteenths of a share of Common Stock. | |||
Preferred stock liquidation preference (in dollars per share) | $ 0.0001 | $ 0.0001 | ||
Description of prefered stock voting rights | Each holder of Series D-1 Preferred Stock shall be entitled to vote on all matters submitted to the Company’s stockholders and shall be entitled to such number of votes equal to the number of shares of Common Stock such shares of Series D-1 Preferred Stock are convertible into at such time, taking into account the beneficial ownership limitations set forth in the governing Certificate of Designation. . | |||
Preferred stock issued | 834 | 834 | ||
Preferred stock outstanding | 834 | 834 | ||
Series D Convertible Preferred Stock [Member] | ||||
Preferred stock liquidation preference (in dollars per share) | $ 0.0001 | $ 0.0001 | ||
Preferred stock issued | 4,725 | 4,725 | ||
Preferred stock outstanding | 4,725 | 4,725 | ||
North South Patent Portfolio Acquired 9/10/13 [Member] | Series D Convertible Preferred Stock [Member] | ||||
Number of shares issued | 1,379,685 | |||
Description of stock conversion terms | Convertible into ten-nineteenths of a share of Common Stock. |
Stockholders' Equity and Con_10
Stockholders' Equity and Convertible Preferred Stock (Details Narrative 2) - USD ($) $ in Thousands | Oct. 11, 2017 | Mar. 14, 2017 | Dec. 31, 2018 | Dec. 31, 2017 |
Allocated stock based compensation | $ 213 | $ 14 | ||
Unrecognized stock-based compensation expense | $ 8 | |||
Weighted average remaining contractual term of exercisable option (in years) | 4 years 9 months 18 days | |||
2013 Equity Incentive Plan [Member] | Maximum [Member] | ||||
Vested options outstanding | 105,547 | |||
Number of shares available for grant | 41,821 | |||
2014 Equity Incentive Plan [Member] | ||||
Number of shares available for grant | 11,330 | |||
Options outstanding | 422,880 | |||
Restricted Stock Units [Member] | ||||
Number of non-option shares granted | 23,287 | |||
Restricted Stock Units [Member] | Consulting Agreement [Member] | ||||
Number of non-option shares granted | 5,000 | |||
Non-option grant date fair value | $ 8,400 | |||
Restricted Stock Units [Member] | Anthony Hayes [Member] | ||||
Number of non-option shares granted | 35,969 |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended |
Nov. 30, 2018 | Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Financed to director and officer for insurance | $ 200 | |
Term of policy | 12 months | |
Accrued expenses | $ 100 | |
Aggregate settlement amount | $ 200,000 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Federal | ||
Current | ||
Deferred | (477) | 14,376 |
Decrease in valuation allowance | 477 | (14,376) |
State and local | ||
Current | ||
Deferred | (92) | (1,416) |
(Decrease) Increase in valuation allowance | 92 | 1,416 |
Change in valuation allowance | 569 | (12,960) |
Income Tax Provision (Benefit) |
Income Taxes (Details 1)
Income Taxes (Details 1) | 1 Months Ended | 12 Months Ended | |
Dec. 22, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
U.S. Statutory Federal Rate | 21.00% | 21.00% | 34.00% |
Federal tax rate change | (45608.00%) | ||
State Taxes, Net of Federal Tax Benefit | 3.91% | 2.28% | |
Other Permanent Differences | 1.77% | 3.12% | |
State rate change in effect | |||
Fair Value of Warrants | 8.99% | (1.23%) | |
Increase due to true up of State NOL | 26.00% | ||
Decrease due to change in Federal NOL and other true ups | (2.72%) | (0.12%) | |
Change in Valuation Allowance | (32.94%) | 392.03% | |
Income Tax Provision (Benefit) | 0.00% | 0.00% |
Income Taxes (Details 2)
Income Taxes (Details 2) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Deferred tax assets: | ||
Net-operating loss carryforward | $ 12,163 | $ 9,608 |
Stock based compensation | 5,444 | 5,368 |
Patent portfolio and other | 9,183 | 11,244 |
Total Deferred Tax assets | 26,790 | 26,220 |
Valuation allowance | (26,790) | (26,220) |
Deferred Tax Asset, Net of Allowance |
Income Taxes (Details 3)
Income Taxes (Details 3) - Alternative Minimum Tax Credit Refund [Member] $ in Thousands | Dec. 31, 2018USD ($) |
Tax Credit Carryforward [Line Items] | |
Credit Refund Request | $ 40,932 |
Tax Year 2019 [Member] | |
Tax Credit Carryforward [Line Items] | |
Credit Refund Request | 20,466 |
Tax Year 2020 [Member] | |
Tax Credit Carryforward [Line Items] | |
Credit Refund Request | 10,233 |
Tax Year 2021 [Member] | |
Tax Credit Carryforward [Line Items] | |
Credit Refund Request | $ 10,233 |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |
Dec. 22, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Change in valuation allowance | $ 569 | $ (12,960) | |
Federal and state net operating loss carryovers | $ 52,530 | ||
Description of operating loss carryforwards expiration | Expire from 2039 through 2038. | ||
Previous federal corporate tax rate | 35.00% | ||
Revised federal corporate tax rate | 21.00% | 21.00% | 34.00% |
Deferred tax expense benefit | $ 15,080 |