Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Dec. 31, 2014 | Feb. 27, 2015 | Jun. 30, 2014 |
Document Documentand Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | FALSE | ||
Document Period End Date | 31-Dec-14 | ||
Document Fiscal Year Focus | 2014 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | LUNA | ||
Entity Registrant Name | LUNA INNOVATIONS INC | ||
Entity Central Index Key | 1239819 | ||
Current Fiscal Year End Date | -19 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Common Stock, Shares Outstanding | 15,095,017 | ||
Entity Public Float | $21 |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Current assets: | ||
Cash and cash equivalents | $14,116,969 | $7,778,541 |
Accounts receivable, net | 5,689,615 | 5,408,281 |
Inventory, net | 3,364,233 | 3,346,177 |
Prepaid expenses | 523,553 | 708,974 |
Other current assets | 191,749 | 70,208 |
Total current assets | 23,886,119 | 17,312,181 |
Property and equipment, net | 3,497,057 | 2,060,709 |
Intangible assets, net | 199,277 | 288,475 |
Other assets | 1,995 | 42,710 |
Total assets | 27,584,448 | 19,704,075 |
Current Liabilities: | ||
Current portion of long term debt obligation | 625,000 | 1,500,000 |
Current portion of capital lease obligation | 70,725 | 66,617 |
Accounts payable | 1,447,177 | 1,401,764 |
Accrued liabilities | 5,536,322 | 3,546,585 |
Deferred revenue | 861,081 | 691,424 |
Total current liabilities | 8,540,305 | 7,206,390 |
Long-term debt obligation | 0 | 625,000 |
Long-term capital lease obligation | 39,582 | 110,307 |
Total liabilities | 8,579,887 | 7,941,697 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Preferred stock, par value $0.001, 1,321,514 shares authorized, issued and outstanding at December 31, 2013 and 2014 | 1,322 | 1,322 |
Common stock, par value $0.001, 100,000,000 shares authorized, 14,527,335 and 15,110,924 shares issued, 14,527,335 and 15,088,199 shares outstanding at December 31, 2013 and 2014, respectively | 15,541 | 14,842 |
Treasury stock at cost, zero shares at December 31, 2013 and 22,725 shares at December 31, 2014 | -32,221 | 0 |
Additional paid-in capital | 64,147,666 | 62,756,571 |
Accumulated deficit | -45,127,747 | -51,010,357 |
Total stockholders’ equity | 19,004,561 | 11,762,378 |
Total liabilities and stockholders’ equity | $27,584,448 | $19,704,075 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $0.00 | $0.00 |
Preferred stock, shares authorized | 1,321,514 | 1,321,514 |
Preferred stock, shares issued | 1,321,514 | 1,321,514 |
Preferred stock, shares outstanding | 1,321,514 | 1,321,514 |
Common stock, par value (in dollars per share) | $0.00 | $0.00 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 15,110,924 | 14,527,335 |
Common stock, shares outstanding | 15,088,119 | 14,527,335 |
Treasury Stock, shares | 22,725 | 0 |
CONSOLIDATED_STATEMENTS_OF_OPE
CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Revenues: | ||
Technology development revenues | $12,205,889 | $11,421,868 |
Products and licensing revenues | 9,054,101 | 6,911,707 |
Total revenues | 21,259,990 | 18,333,575 |
Cost of revenues: | ||
Technology development costs | 9,376,485 | 8,882,071 |
Products and licensing costs | 4,046,885 | 3,402,882 |
Total cost of revenues | 13,423,370 | 12,284,953 |
Gross profit | 7,836,620 | 6,048,622 |
Operating expense: | ||
Selling, general & administrative | 10,253,847 | 11,525,636 |
Research, development, and engineering | 2,087,874 | 2,558,332 |
Total operating expense | 12,341,721 | 14,083,968 |
Operating loss | -4,505,101 | -8,035,346 |
Other income/(expense): | ||
Other income, net | 111,452 | 347,062 |
Interest expense, net | -96,229 | -207,538 |
Total other income | 15,223 | 139,524 |
Loss from continuing operations before income taxes | -4,489,878 | -7,895,822 |
Income tax benefit | -1,137,228 | -2,387,422 |
Loss from continuing operations | -3,352,650 | -5,508,400 |
Operating income/(loss) from discontinued operations, net of $0.9 million and $0.0 million of related income taxes | -34,491 | 1,313,611 |
Gain on sale, net of $1.5 million and $1.3 million of related income taxes | 9,381,948 | 3,391,639 |
Income from discontinued operations, net of income taxes | 9,347,457 | 4,705,250 |
Net (loss)/income | 5,994,807 | -803,150 |
Preferred stock dividend | 112,197 | 102,327 |
Net (loss)/income attributable to common stockholders | $5,882,610 | ($905,477) |
Net loss per share from continuing operations: | ||
Basic and diluted (in dollars per share) | ($0.23) | ($0.38) |
Net income per share from discontinued operations: | ||
Basic and diluted (in dollars per share) | $0.63 | $0.33 |
Net (loss)/ income per share attributable to common stockholders: | ||
Basic and diluted (in dollars per share) | $0.40 | ($0.06) |
Weighted average shares: | ||
Basic and diluted (in shares) | 14,880,697 | 14,336,135 |
CONSOLIDATED_STATEMENTS_OF_OPE1
CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Income Statement [Abstract] | ||
Operating income/(loss) from discontinued operations, taxes | $0 | $0.90 |
Gain on sale, taxes | $1.30 | $1.50 |
CONSOLIDATED_STATEMENTS_OF_CHA
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT) (USD $) | Total | Preferred Stock | Common Stock | Treasury Stock | Additional Paid in Capital | Accumulated Deficit | |
Beginning Balance at Dec. 31, 2012 | $11,272,192 | $1,322 | $14,245 | $0 | $61,361,505 | ($50,104,880) | |
Beginning Balance (in shares) at Dec. 31, 2012 | 1,321,514 | 14,009,280 | 0 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Exercise of stock options and warrants (in shares) | 169,277 | ||||||
Exercise of stock options and warrants | 111,957 | 168 | 111,789 | ||||
Stock-based compensation (in shares) | 0 | ||||||
Stock-based compensation | 1,063,645 | 0 | 1,063,645 | ||||
Non cash compensation (in shares) | 337,500 | ||||||
Non cash compensation | 102,734 | 338 | 102,396 | ||||
Stock dividends | [1] | 80 | 102,247 | -102,327 | |||
Issuance of Common Stock, Other (in shares) | [2] | 11,278 | |||||
Issuance of Common Stock, Other | [2] | 15,000 | 11 | 14,989 | |||
Net (loss)/income | -803,150 | -803,150 | |||||
Ending Balance at Dec. 31, 2013 | 11,762,378 | 1,322 | 14,842 | 0 | 62,756,571 | -51,010,357 | |
Ending Balance (in shares) at Dec. 31, 2013 | 1,321,514 | 14,527,335 | 0 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Exercise of stock options and warrants (in shares) | 315,087 | ||||||
Exercise of stock options and warrants | 232,042 | 316 | 231,726 | ||||
Stock-based compensation (in shares) | 0 | ||||||
Stock-based compensation | 854,370 | 0 | 854,370 | ||||
Non cash compensation (in shares) | 245,777 | ||||||
Non cash compensation | 193,185 | 303 | 192,882 | ||||
Stock dividends | [1] | 80 | 112,117 | -112,197 | |||
Purchase of treasury stock (in shares) | 22,725 | ||||||
Purchase of treasury stock | -32,221 | -32,221 | |||||
Net (loss)/income | 5,994,807 | ||||||
Ending Balance at Dec. 31, 2014 | $19,004,561 | $1,322 | $15,541 | ($32,221) | $64,147,666 | ($45,127,747) | |
Ending Balance (in shares) at Dec. 31, 2014 | 1,321,514 | 15,088,199 | 22,725 | ||||
[1] | The stock dividends payable in connection with the Series A Convertible Preferred Stock are issuable upon the request of Carilion. | ||||||
[2] | Fees paid to our board of directors by issuance of our common stock. |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Cash flows used in operating activities: | ||
Net loss | $5,994,807 | ($803,150) |
Adjustments to reconcile net (loss)/income to net cash used in by operating activities: | ||
Depreciation and amortization | 607,693 | 935,477 |
Stock-based compensation | 1,019,445 | 1,181,379 |
Gain on sale of discontinued operations, net of income taxes | -9,381,948 | -3,391,639 |
Inventory obsolescence | 163,998 | 0 |
Bad debt | 0 | 134,811 |
Tax benefit from utilization of loss from current year operations | -1,148,941 | -1,507,791 |
Changes in operating assets and liabilities: | ||
Accounts receivable | -281,334 | 1,533,827 |
Inventory | -220,419 | -9,261 |
Other assets | 50,696 | -79,180 |
Accounts payable and accrued liabilities | 311,627 | 396,540 |
Deferred revenue | 169,657 | -178,305 |
Net cash used in operating activities | -2,714,719 | -1,787,292 |
Cash flows provided by investing activities: | ||
Acquisition of property and equipment | -255,242 | -186,956 |
Intangible property costs | -252,083 | -253,451 |
Proceeds from sale of discontinued operations, net | 10,927,268 | 5,110,855 |
Net cash provided by investing activities | 10,419,943 | 4,670,448 |
Cash flows used in financing activities: | ||
Payments on debt obligations | -1,500,000 | -1,500,000 |
Payments on capital lease obligations | -66,617 | -57,033 |
Repurchase of common stock | -32,221 | 0 |
Proceeds from the exercise of options and warrants | 232,042 | 111,957 |
Net cash used in financing activities | -1,366,796 | -1,445,076 |
Net change in cash and cash equivalents | 6,338,428 | 1,438,080 |
Cash and cash equivalents—beginning of period | 7,778,541 | 6,340,461 |
Cash and cash equivalents—end of period | 14,116,969 | 7,778,541 |
Supplemental disclosure of cash flow information | ||
Cash paid for interest | 87,354 | 178,646 |
Cash paid for income taxes | 150,000 | 14,010 |
Dividend on preferred stock, 79,292 shares of common stock issuable for each of the years ended December 31, 2013 and 2014, respectively | $112,177 | $102,327 |
CONSOLIDATED_STATEMENTS_OF_CAS1
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Statement of Cash Flows [Abstract] | ||
Dividend on preferred stock, shares of common stock issuable | 79,292 | 79,292 |
Organization_and_Summary_of_Si
Organization and Summary of Significant Accounting Policies | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||
Organization and Summary of Significant Accounting Policies | Organization and Summary of Significant Accounting Policies | ||||
Luna Innovations Incorporated (“we” or the "Company”), headquartered in Roanoke, Virginia was incorporated in the Commonwealth of Virginia in 1990 and reincorporated in the State of Delaware in April 2003. | |||||
We develop, manufacture and market fiber optic sensing and test & measurement products focused on bringing new and innovative technology solutions to measure, monitor, protect and improve critical processes in the aerospace, automotive, energy, composite, telecommunications and defense industries. Our business model is designed to accelerate the process of bringing new and innovative products to market. We use our in-house technical expertise to perform applied research services on government-funded projects across a range of technologies and also for corporate customers in the fiber optic sensing area. We are organized into two business segments: our Technology Development segment and our Products and Licensing segment. Our Technology Development segment performs applied research principally on government-funded projects. Most of the government funding in our Technology Development segment is derived from the U.S. Government’s Small Business Innovation Research ("SBIR") program coordinated by the U.S. Small Business Administration ("SBA"). Our Products and Licensing segment focuses on fiber optic test and measurement, sensing, and instrumentation products and also conducts applied research in the fiber optic sensing area to corporate and government customers. The Products and Licensing segment focuses on fiber optic test and measurement, sensing and instrumentation products. | |||||
We have a history of net losses and negative cash flow from operations. We have historically managed our liquidity through cost reduction initiatives, debt financings, capital markets transactions and the sale of assets. | |||||
Although there can be no guarantees, we believe that our current cash and cash equivalents balance, provides adequate liquidity for us to meet our working capital needs through 2015. | |||||
Consolidation Policy | |||||
Our consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States ("GAAP") and include the accounts of the Company and its wholly owned subsidiaries. We eliminate from our financial results all significant intercompany transactions. | |||||
Use of Estimates | |||||
The preparation of our consolidated financial statements in accordance with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities in our consolidated financial statements and accompanying notes. | |||||
Although these estimates are based on our knowledge of current events and actions we may undertake in the future, actual results may differ from such estimates and assumptions. | |||||
Technology Development Revenues | |||||
We perform research and development for U.S. government agencies, educational institutions and commercial organizations. We recognize revenues under research contracts when a contract has been executed, the contract price is fixed and determinable, delivery of services or products has occurred and collection of the contract price is considered reasonably assured. Revenue is earned under cost reimbursable, time and materials and fixed price contracts. Direct contract costs are expensed as incurred. | |||||
Under cost reimbursable contracts, we are reimbursed for costs that are determined to be reasonable, allowable and allocable to the contract and are paid a fixed fee representing the profit negotiated between us and the contracting agency. Revenue from cost reimbursable contracts is recognized as costs are incurred plus a portion of the fee earned. Revenue from time and materials contracts is recognized based on direct labor hours expended at contract billing rates plus other billable direct costs. | |||||
Revenue from fixed price research contracts that involve the delivery of services and a prototype model is recognized under the percentage of completion method. Fixed price arrangements that involve the delivery of research reports are recognized under the proportional performance method based upon the ratio of costs incurred to achieve contract milestones to total estimated cost as this method more accurately measures performance under these arrangements. Losses on contracts, if any, are recognized in the period in which they become known and estimable. | |||||
Intellectual Property License Revenues | |||||
Amounts received from third parties for licenses to our intellectual property are recognized when earned under the terms of the agreements. Revenues are recognized upon transfer of the license unless we have continuing obligations for which fair value cannot be established, in which case the revenues are recognized over the period of the obligation. If there are extended payment terms, license fee revenues are recognized as these payments become due and collection is reasonably assured. We consider all arrangements with payment terms extending beyond 12 months not to be fixed and determinable. | |||||
Certain of our license arrangements have also required us to enter into research and development agreements. Accordingly, we allocate our arrangement fees to the various elements based upon objective reliable evidence of fair value, if available. For those arrangements in which evidence of fair value is not available, we defer revenues from any up-front payments and recognize them over the service period in the arrangement. Certain of these arrangements also include the payment of performance bonuses based upon the achievement of specific milestones. Generally, there are no assurances at the onset of these arrangements that the milestones will be achieved. As such, fees related to such milestones are excluded from the initial allocation of the arrangement fee and are recognized upon achievement of the milestone provided that all other revenue recognition criteria are met. | |||||
Product Sales Revenues | |||||
Revenues from product sales are generated by the sale of commercial products and services under various sales programs to the end user and through distribution channels. We sell fiber optic sensing systems to end users for use in numerous fiber optic based measurement applications. Revenues are recorded net of applicable sales taxes collected from customers and payable to state or local governmental entities. | |||||
We recognize revenue relating to our products when persuasive evidence of an arrangement exists, delivery has occurred, the selling price is fixed or determinable and collectability of the resulting receivable is reasonably assured. | |||||
For multi-element arrangements that include tangible products that contain software that is essential to the tangible product’s functionality, we allocate revenue to all deliverables based on their relative selling prices. Other deliverables include extended warranty, training and various add-on products. In such circumstances, we use a hierarchy to determine the selling price to be used for allocating revenue to deliverables: (i) vendor-specific objective evidence of fair value ("VSOE"), (ii) third-party evidence of selling price ("TPE"), and (iii) best estimate of the selling price ("ESP"). VSOE generally exists only when we sell the deliverable separately and is the price actually charged by us for that deliverable. Due to the uniqueness of our products comparable third party evidence is generally not available. ESPs reflect our best estimates of what the selling prices of elements would be if they were sold regularly on a stand-alone basis. | |||||
Our process for determining our ESP for deliverables without VSOE or TPE considers multiple factors that may vary depending upon the unique facts and circumstances related to each deliverable. Key factors considered in developing the ESPs include prices charged by us for similar offerings, our historical pricing practices, the nature of the deliverables, and the relative ESP of all of the deliverables as compared to the total selling price of the product. We may also consider, when appropriate, the impact of other products and services on selling price assumptions when developing and reviewing our ESPs. | |||||
Revenues from product sales that require no ongoing obligations are recognized as revenues when shipped to the customer, title has passed and collection is reasonably assured. In transactions in which a right-of-return exists, revenues are deferred until acceptance has occurred and the period for the right-of-return has expired. | |||||
Allowance for Uncollectible Receivables | |||||
Accounts receivable are recorded at their face amount, less an allowance for doubtful accounts. We review the status of our uncollected receivables on a regular basis. In determining the need for an allowance for uncollectible receivables, we consider our customers’ financial stability, past payment history and other factors that bear on the ultimate collection of such amounts. The allowance was $134,811 at December 31, 2013 and December 31, 2014. | |||||
Cash Equivalents | |||||
We consider all highly liquid investments purchased with maturities of three months or less to be cash equivalents. To date, we have not incurred losses related to cash and cash equivalents. The Company’s cash transactions are processed through reputable commercial banks. To date, the Company has not incurred losses related to cash and cash equivalents. The Company regularly maintains cash balances with financial institutions which exceed Federal Deposit Insurance Corporation (“FDIC”) insurance limits. At December 31, 2013 and December 31, 2014, the Company had approximately $7.5 million and $13.9 million, respectively, in excess of FDIC insured limits. | |||||
Fair Value Measurements | |||||
The Company’s financial assets and liabilities are measured at fair value, which is defined as the price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants. Valuation techniques are based on observable or unobservable inputs. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company’s market assumptions. These two types of inputs have created the following fair value hierarchy: | |||||
• | Level 1—Quoted prices for identical instruments in active markets. | ||||
• | Level 2—Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which significant value drivers are observable. | ||||
• | Level 3—Valuations derived from valuation techniques in which significant value drivers are unobservable. | ||||
The carrying values of cash and cash equivalents, accounts receivable and accounts payable approximate fair value because of the short-term nature of these instruments. We consider the terms of the SVB debt Facility including its interest rate of prime plus 2%, to be at market based upon similar instruments that would be available to us. | |||||
Property and Equipment | |||||
Property and equipment are stated at cost less accumulated depreciation. We record depreciation using the straight-line method over the following estimated useful lives: | |||||
Equipment | 3 – 7 years | ||||
Furniture and fixtures | 7 years | ||||
Software | 3 years | ||||
Leasehold improvements | Lesser of lease term or life of improvements | ||||
Intangible Assets | |||||
Intangible assets consist of patents related to certain intellectual property that we have developed or acquired. We amortize our patents over their estimated useful life of five years, and analyze them whenever events or circumstances indicate that the carrying amount may not be recoverable to determine whether their carrying value has been impaired. | |||||
Research, Development and Engineering | |||||
Research, development and engineering expenses not related to contract performance are expensed as incurred. We expensed $2.6 million and $2.1 million of non-contract related research, development and engineering expenses for the years ended December 31, 2013 and 2014, respectively. | |||||
Valuation of Long-Lived Assets | |||||
We review our long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets is measured by comparing the carrying amount of an asset to future undiscounted net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds their fair value. Assets to be disposed of by sale are reflected at the lower of their carrying amount or fair value less cost to sell. | |||||
Inventory | |||||
Inventory consists of finished goods, work in process and raw materials valued at the lower of cost (determined on the first-in, first-out basis) or market. We provide reserves for estimated obsolescence or unmarketable inventory equal to the difference between the carrying value of the inventory and the estimated market value based upon assumptions about future demand and market conditions. | |||||
Net (Loss)/Income per Share | |||||
Basic per share data is computed by dividing net (loss)/income attributable to common stockholders by the weighted average number of shares outstanding during the period. Diluted per share data is computed by dividing net (loss)/income attributable to common stockholders by the weighted average shares outstanding during the period increased to include, if dilutive, the number of additional common share equivalents that would have been outstanding if potential common shares had been issued using the treasury stock method. Diluted per share data would also include the potential common share equivalents relating to convertible securities by application of the if-converted method. | |||||
The effect of 2.3 million common stock equivalents (which include outstanding warrants, preferred stock and stock options) are not included for the years ended December 31, 2013 and 2014, as they are antidilutive to earnings per share due to the Company having a net loss from continuing operations. | |||||
Stock-Based Compensation | |||||
We have a stock-based compensation plan, which is described further in Note 9. We recognize compensation expense based upon the fair value of the underlying equity award as of the date of grant. The Company has elected to use the Black-Scholes option pricing model to value any awards granted. We recognize stock-based compensation for such awards on a straight-line method over the requisite service period of the awards taking into account the effects of the employees’ expected exercise and post-vesting employment termination behavior. | |||||
The Company recognizes expense for equity instruments issued to non-employees based upon the fair value of the equity instruments issued. | |||||
The fair value of each option granted is estimated as of the grant date using the Black-Scholes option pricing model with the following assumptions: | |||||
Years ended December 31, | |||||
2013 | 2014 | ||||
Risk-free interest rate range | 1.27% – 2.34% | 2.02% – 2.27% | |||
Expected life of option-years | 7.5 | 7.5 | |||
Expected stock price volatility | 108% | 106% | |||
Executive turnover rates | —% | —% | |||
Non-executive turnover rates | 14.70% | 33.60% | |||
Expected dividend yield | —% | —% | |||
The risk-free interest rate is based on U.S. Treasury interest rates, the terms of which are consistent with the expected life of the stock options. Expected volatility is based upon the average historical volatility of our common stock over the period commensurate with the expected term of the related instrument. The expected life and estimated post-employment termination behavior is based upon historical experience of homogeneous groups, executives and non-executes, within our company. We do not currently pay dividends on our common stock nor do we expect to in the foreseeable future. | |||||
Advertising | |||||
We expense the cost of advertising as incurred. Historically such amounts have not been significant to our operations. | |||||
Income Taxes | |||||
We account for income taxes using the liability method. Deferred tax assets or liabilities are determined based on the difference between the financial statement and tax basis of assets and liabilities as measured by the enacted tax rates which will be in effect when the differences reverse. A valuation allowance against net deferred tax assets is provided unless we conclude it is more likely than not that the deferred tax assets will be realized. | |||||
We recognize tax benefits from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by taxing authorities. | |||||
Recent Accounting Pronouncements | |||||
In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (ASU 2014-09), which supersedes nearly all existing revenue recognition guidance under U.S. GAAP. The core principle of ASU 2014-09 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled for those goods or services. ASU 2014-09 defines a five step process to achieve this core principle and, in doing so, more judgment and estimates may be required within the revenue recognition process than are required under existing U.S. GAAP. The standard is effective for annual periods beginning after December 15, 2016, and interim periods therein, using either of the following transition methods: (i) a full retrospective approach reflecting the application of the standard in each prior reporting period with the option to elect certain practical expedients, or (ii) a retrospective approach with the cumulative effect of initially adopting ASU 2014-09 recognized at the date of adoption (which includes additional footnote disclosures). We are currently evaluating the impact of our pending adoption of ASU 2014-09 on our consolidated financial statements and have not yet determined the method by which we will adopt the standard in 2017. |
Inventory
Inventory | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Inventory Disclosure [Abstract] | ||||||||
Inventory | Inventory | |||||||
Inventory consists of finished goods, work-in-process and raw materials valued at the lower of cost (determined on the first-in, first-out basis) or market. We provide reserves for estimated obsolescence or unmarketable inventory equal to the difference between the cost of the inventory and the estimated market value based upon assumptions about future demand and market conditions. | ||||||||
Components of inventory are as follows: | ||||||||
31-Dec-13 | 31-Dec-14 | |||||||
Finished goods | $ | 719,574 | $ | 648,182 | ||||
Work-in-process | 361,754 | 262,025 | ||||||
Raw materials | 2,339,595 | 2,692,765 | ||||||
3,420,923 | 3,602,972 | |||||||
Less: Inventory reserves | 74,746 | 238,739 | ||||||
Total inventory, net | $ | 3,346,177 | $ | 3,364,233 | ||||
Debt
Debt | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Debt Disclosure [Abstract] | |||||||||
Debt | Debt | ||||||||
Silicon Valley Bank Facility | |||||||||
We currently have a Loan and Security Agreement with Silicon Valley Bank (“SVB”) under which we have a term loan with an original borrowing amount of $6.0 million (the “Term Loan”). The Term Loan is to be repaid by us in 48 monthly installments, plus accrued interest payable monthly in arrears, and unless earlier terminated, matures on the earlier of either May 1, 2015 or an event of a default under the loan agreement. The term loan carries a floating annual interest rate equal to SVB’s prime rate then in effect plus 2%. We may repay amounts due under the Term Loan at any time with no penalties. | |||||||||
In addition to the terms and conditions of the Term Loan, we had a revolving line of credit (the “Line of Credit”) which had a maximum borrowing capacity of $1.0 million. The interest rate on the Line of Credit was SVB’s prime rate plus 1.25%, paid monthly in arrears, and we were required to pay an unused Line of Credit fee of one-quarter of one percent (0.25%), paid monthly. We could have terminated the Line of Credit for a termination fee of $10,000, which fee would not be paid in the event that the Line of Credit is replaced by another loan facility with SVB. The Line of Credit matured on May 18, 2014 and was not renewed. | |||||||||
Amounts due under the Credit Facility are secured by substantially all of our assets, including intellectual property, personal property and bank accounts. | |||||||||
On March 21, 2013, we entered into a Fourth Loan Modification Agreement with SVB that replaced the existing financial covenants with a single covenant that we maintain a minimum cash balance of $5.0 million with SVB. Effective on January 21, 2014, in connection with our sale of assets to Intuitive, this covenant was modified to reduce the required minimum cash balance to $3.5 million. The Credit Facility also requires us to observe a number of operational covenants, including protection and registration of intellectual property rights, and certain customary negative covenants. As of December 31, 2014, we were in compliance with all covenants under the Credit Facility. | |||||||||
In addition, the Credit Facility contains customary events of default, including nonpayment of principal, interest or other amounts, violation of covenants, material adverse change, an event of default under any subordinated debt documents, incorrectness of representations and warranties in any material respect, bankruptcy, judgments in excess of a threshold amount, and violations of other agreements in excess of a threshold amount. If any event of default occurs SVB may declare due immediately all borrowings under the Credit Facility and foreclose on the collateral. Furthermore, an event of default under the Credit Facility would result in an increase in the interest rate on any amounts outstanding. As of December 31, 2014, there were no events of default on the Credit Facility. | |||||||||
The balance under the Term Loan at December 31, 2014 was $0.6 million all of which was classified as short-term. The effective rate of our Term Loan at December 31, 2014 was 6%. | |||||||||
The following table presents a summary of debt outstanding as of December 31, 2013 and 2014: | |||||||||
December 31, | |||||||||
2013 | 2014 | ||||||||
Silicon Valley Bank Term Loan | $ | 2,125,000 | $ | 625,000 | |||||
Less: current portion | 1,500,000 | 625,000 | |||||||
Total long-term debt | $ | 625,000 | $ | — | |||||
Maturities on long-term debt are as follows: | |||||||||
Year | Amount | ||||||||
2015 | 625,000 | ||||||||
Total | $ | 625,000 | |||||||
Costs associated with loans outstanding were as follows: | |||||||||
Years ended December 31, | |||||||||
2013 | 2014 | ||||||||
Interest expense | $ | 189,151 | $ | 87,426 | |||||
Amortization of transaction costs | 18,387 | 8,803 | |||||||
Total interest expense | $ | 207,538 | $ | 96,229 | |||||
Accounts_ReceivableTrade
Accounts Receivable-Trade | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Receivables [Abstract] | ||||||||
Accounts Receivable-Trade | Accounts Receivable—Trade | |||||||
Accounts receivable consist of the following: | ||||||||
December 31, | ||||||||
2013 | 2014 | |||||||
Billed | $ | 3,552,184 | $ | 4,517,672 | ||||
Unbilled | 1,755,439 | 1,249,814 | ||||||
Other | 235,469 | 56,940 | ||||||
$ | 5,543,092 | $ | 5,824,426 | |||||
Less: allowance for doubtful accounts | (134,811 | ) | (134,811 | ) | ||||
$ | 5,408,281 | $ | 5,689,615 | |||||
Unbilled receivables result from contract retainages and revenues that have been earned in advance of billing and can be invoiced at contractually defined intervals, milestones, or at completion of the contract. Unbilled amounts are expected to be billed in future periods and are classified as current assets in accordance with industry practice. |
Property_and_Equipment
Property and Equipment | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Property, Plant and Equipment [Abstract] | ||||||||
Property and Equipment | Property and Equipment | |||||||
Property and equipment, net, consists of the following at: | ||||||||
December 31, | ||||||||
2013 | 2014 | |||||||
Building | $ | 69,556 | $ | 69,556 | ||||
Equipment | 7,239,017 | 7,312,730 | ||||||
Furniture and fixtures | 562,485 | 562,485 | ||||||
Software | 1,092,484 | 1,092,484 | ||||||
Leasehold improvements | 3,168,377 | 4,830,055 | ||||||
12,131,919 | 13,867,310 | |||||||
Less—accumulated depreciation | (10,071,210 | ) | (10,370,253 | ) | ||||
$ | 2,060,709 | $ | 3,497,057 | |||||
Depreciation for the years ended December 31, 2013 and 2014 was approximately $0.5 million and $0.3 million, respectively. |
Intangible_Assets
Intangible Assets | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||
Intangible Assets | Intangible Assets | |||||||
The following is a summary of intangible assets, net: | ||||||||
December 31, | ||||||||
2013 | 2014 | |||||||
Patent costs | $ | 2,496,560 | $ | 2,356,820 | ||||
Accumulated amortization | (2,208,085 | ) | (2,157,543 | ) | ||||
$ | 288,475 | $ | 199,277 | |||||
Amortization for the years ended December 31, 2013 and 2014 was approximately $0.4 million and $0.3 million, respectively. Estimated aggregate amortization, based on the net value of intangible assets at December 31, 2014, for each of the next five years is as follows: | ||||||||
Year Ending December 31, | ||||||||
2015 | 91,285 | |||||||
2016 | 53,342 | |||||||
2017 | 29,218 | |||||||
2018 | 15,137 | |||||||
2019 | 2,210 | |||||||
$ | 191,192 | |||||||
Accrued_Liabilities_Accrued_Li
Accrued Liabilities Accrued Liabilities | 12 Months Ended | ||||||
Dec. 31, 2014 | |||||||
Payables and Accruals [Abstract] | |||||||
Accrued Liabilities | Accrued Liabilities | ||||||
December 31, | |||||||
2013 | 2014 | ||||||
Accrued compensation | 2,205,612 | 2,362,608 | |||||
Accrued sub-contracts | 297,510 | 244,218 | |||||
Accrued professional fees | 279,991 | 177,712 | |||||
Accrued income tax | 13,143 | 166,550 | |||||
Deferred rent | 102,569 | 1,752,717 | |||||
Royalties | 291,442 | 392,945 | |||||
Warranty reserve | 56,700 | 69,264 | |||||
Claims reserve | 92,167 | — | |||||
Accrued liabilities - other | 207,451 | 370,308 | |||||
Total Accrued Liabilities | 3,546,585 | 5,536,322 | |||||
Income_Taxes
Income Taxes | 12 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
Income Tax Disclosure [Abstract] | ||||||||||||||||
Income Taxes | Income Taxes | |||||||||||||||
The benefit from income taxes from continuing operations consisted of the following for the periods indicated: | ||||||||||||||||
Years ended December 31, | ||||||||||||||||
2013 | 2014 | |||||||||||||||
Current: | ||||||||||||||||
Federal | $ | (2,387,422 | ) | $ | (1,146,447 | ) | ||||||||||
State | — | 9,219 | ||||||||||||||
Deferred Federal | — | — | ||||||||||||||
Deferred State | — | — | ||||||||||||||
Income tax benefit | $ | (2,387,422 | ) | $ | (1,137,228 | ) | ||||||||||
Deferred tax assets and liabilities consist of the following components: | ||||||||||||||||
December 31, 2013 | December 31, 2014 | |||||||||||||||
Current | Long-Term | Current | Long-Term | |||||||||||||
Bad debt and inventory reserve | $ | 88,077 | $ | — | $ | 150,330 | $ | — | ||||||||
Deferred revenue | — | 59,673 | — | 126,096 | ||||||||||||
Depreciation and amortization | — | 1,024,746 | — | 309,600 | ||||||||||||
Net operating loss carryforwards | — | 10,897,715 | — | 8,030,396 | ||||||||||||
Research and development credits | — | 386,161 | — | 386,161 | ||||||||||||
Accrued liabilities | 836,049 | — | 1,584,633 | — | ||||||||||||
Deferred compensation | — | 163,655 | — | 199,717 | ||||||||||||
Stock-based compensation | — | 1,519,513 | — | 1,695,868 | ||||||||||||
AMT credit | — | 42,636 | — | 207,648 | ||||||||||||
Total | 924,126 | 14,094,099 | 1,734,963 | 10,955,486 | ||||||||||||
Valuation allowance | (924,126 | ) | (14,094,099 | ) | (1,734,963 | ) | (10,955,486 | ) | ||||||||
Net deferred tax asset | $ | — | $ | — | $ | — | $ | — | ||||||||
The benefit from income taxes from continuing operations differs from the amount computed by applying the federal statutory income tax rate to the Company’s loss from continuing operations before income taxes as follows for the periods indicated: | ||||||||||||||||
Years ended December 31, | ||||||||||||||||
2013 | 2014 | |||||||||||||||
Income tax expense at federal statutory rate | 34 | % | 34 | % | ||||||||||||
State taxes, net of federal tax effects | 3.96 | % | 3.75 | % | ||||||||||||
Change in valuation allowance | (3.78 | )% | (8.02 | )% | ||||||||||||
Incentive stock options | (4.12 | )% | (3.33 | )% | ||||||||||||
Provision to return adjustments | 2.43 | % | (0.34 | )% | ||||||||||||
Meals and entertainment | (0.13 | )% | (0.27 | )% | ||||||||||||
Other Permanent differences | (2.12 | )% | (0.46 | )% | ||||||||||||
Income tax benefit | 30.24 | % | 25.33 | % | ||||||||||||
The realization of our deferred income tax assets is dependent upon sufficient taxable income in future periods. In assessing whether deferred tax assets may be realized, we consider whether it is more likely than not that some portion, or all, of the deferred tax asset will be realized. We consider scheduled reversals of deferred tax liabilities, projected future taxable income and tax planning strategies that we can implement in making our assessment. We have net operating loss carryforwards at December 31, 2014 of approximately $21.2 million expiring at varying dates through 2025. We have research and development tax credit carryforwards at December 31, 2014 of approximately $0.4 million, which expire at varying dates through 2024. | ||||||||||||||||
We have undertaken a formal section 382 study and determined that we do not have a limitation on our net operating loss available to offset future income. | ||||||||||||||||
The U.S. federal statute of limitations remains open for the year 2006 and onward. We currently have no federal income tax returns under examination. U.S. state jurisdictions have statutes of limitation generally ranging from three to seven years. We currently have no state income or franchise tax returns under examination. We currently do not file tax returns in any foreign tax jurisdiction. | ||||||||||||||||
We currently have no positions for which we expect that the amount of unrecognized tax benefit will increase or decrease significantly within twelve months of the reporting date or for which we believe there is significant risk of disallowance upon audit. We have no tax interest or penalties reported in either our statement of operations or statement of financial position for any year reported herein. Management believes it is not more likely than not that the deferred tax assets at December 31, 2013 or December 31, 2014 will not be realized, and as a result a valuation allowance was established against all such deferred tax assets. | ||||||||||||||||
Windfall equity-based compensation deductions are tracked, but will not be recorded to the balance sheet until management determines it is more likely than not that such amounts will be utilized. As of December 31, 2014, the Company had approximately $331,007 of windfall stock compensation deductions. If and when realized, the tax benefit associated with these deductions will be credited to additional paid-in capital. These excess benefit deductions are included in the total federal net operating losses disclosed above. |
Stockholders_Equity
Stockholders' Equity | 12 Months Ended | |||||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||||
Equity [Abstract] | ||||||||||||||||||||||||
Stockholders' Equity | Stockholders’ Equity | |||||||||||||||||||||||
Series A Convertible Preferred Stock | ||||||||||||||||||||||||
In January 2010, we entered into a transaction with Carilion, in which Carilion agreed to exchange all of its Senior Convertible Promissory Notes with an original principal amount of $5.0 million plus all accrued but unpaid interest, totaling $1.2 million, for 1,321,514 shares of our newly designated Series A Convertible Preferred Stock. The Series A Convertible Preferred Stock is non-voting, carries a dividend of 6% payable in shares of common stock and maintains a liquidation preference up to $6.2 million. As of December 31, 2014, 393,277 shares of common stock were issuable to Carilion as dividends and have been recorded in the statement of stockholders’ equity. These dividends are issuable on demand. Each share of Series A Convertible Preferred Stock may be converted into one share of our common stock at the option of the holder. We recorded the fair value of the Series A Convertible Preferred Stock, determined based upon the conversion value immediately prior to the exchange, the fair value of the new warrant issued to Carilion, determined using the Black-Scholes valuation model, and the incremental fair value of the prior warrant due to the re-pricing and extension of maturity to stockholders’ equity. | ||||||||||||||||||||||||
Stock Option Plans | ||||||||||||||||||||||||
In April 2003, we adopted the Luna Innovations Incorporated 2003 Stock Plan, or the 2003 Plan. Under the 2003 Plan, our Board of Directors was authorized to grant both incentive and non-statutory stock options to our employees, directors and consultants to purchase shares of Common Stock. Options generally had a life of 10 years and exercise price equal to or greater than the fair market value of the Common Stock as determined by the Board of Directors. On February 4, 2006, our Board of Directors increased the number of shares reserved under the 2003 Plan to 9,715,000. There were options outstanding under the 2003 Plan to purchase an aggregate of 541,394 shares as of December 31, 2014. Following the adoption of the 2006 Equity Incentive Plan in January 2006, no shares or options are available for future grant under the 2003 Plan, except to satisfy grants outstanding as of June 5, 2006. | ||||||||||||||||||||||||
In January 2006, we adopted our 2006 Equity Incentive Plan or the 2006 Plan. Under the 2006 Plan, our Board of Directors is authorized to grant both incentive and non-statutory stock options to purchase common stock and restricted stock awards to our employees, directors, and consultants. Stock option awards generally have a life of 10 years and exercise prices equal to the closing price of our common stock on the date of the option grant. On January 1 of each year, the number of shares available for issuance increases by the lesser of (a) 10% of the outstanding shares of our common stock on the last day of the preceding fiscal year; (b) 1,695,690 shares; or (c) such other amount as our Board of Directors may determine. A total of 10,468,175 and 13,999,918 shares were available for future grant under the 2006 Plan as of December 31, 2013 and 2014, respectively. | ||||||||||||||||||||||||
Vesting for employees typically occurs over a five-year period. | ||||||||||||||||||||||||
The following table sets forth the activity of the options to purchase common stock under the 2003 Plan and the 2006 Plan. The prices represent the closing price of our Common Stock on the NASDAQ Capital Market on the respective dates. | ||||||||||||||||||||||||
Options Outstanding | Options Exercisable | |||||||||||||||||||||||
Number of | Price per | Weighted | Aggregate | Number of | Weighted | Aggregate | ||||||||||||||||||
Shares | Share Range | Average | Intrinsic | Shares | Average | Intrinsic | ||||||||||||||||||
Exercise | Value (1) | Exercise | Value (1) | |||||||||||||||||||||
Price | Price | |||||||||||||||||||||||
Balance at January 1, 2013 | 5,422,130 | $0.35–6.74 | $ | 2.19 | $ | 639,904 | 3,775,388 | $ | 2.37 | $ | 604,292 | |||||||||||||
Forfeited | (693,644 | ) | 0.35–6.74 | 2.08 | ||||||||||||||||||||
Exercised | (137,097 | ) | 0.35–1.18 | 0.56 | ||||||||||||||||||||
Granted | 687,840 | 1.20–1.31 | 1.29 | |||||||||||||||||||||
Balance at December 31, 2013 | 5,279,229 | $0.35 - 6.55 | $ | 2.11 | $ | 784,154 | 4,012,378 | $ | 2.28 | $ | 697,826 | |||||||||||||
Forfeited | (1,660,354 | ) | $0.35 - 6.55 | 2.22 | ||||||||||||||||||||
Exercised | (321,696 | ) | $0.35 - 1.27 | 0.73 | ||||||||||||||||||||
Granted | 992,452 | $1.37 - 1.53 | 1.43 | |||||||||||||||||||||
Balance at December 31, 2014 | 4,289,631 | $0.35 - 6.55 | $ | 1.93 | $ | 512,901 | 3,111,199 | $ | 2.11 | $ | 453,032 | |||||||||||||
-1 | The intrinsic value of an option represents the amount by which the market value of the stock exceeds the exercise price of the option of in-the-money options only. | |||||||||||||||||||||||
Options Outstanding | Options Exercisable | |||||||||||||||||||||||
Range of | Options | Weighted | Weighted | Options | Weighted | |||||||||||||||||||
Exercise Prices | Outstanding | Average | Average | Exercisable | Average | |||||||||||||||||||
Remaining | Exercise | Exercise | ||||||||||||||||||||||
Life in | Price | Price of | ||||||||||||||||||||||
Years | Options | |||||||||||||||||||||||
Exercisable | ||||||||||||||||||||||||
Year ended December 31, 2013 | $0.35 - 6.55 | 5,279,229 | 5.88 | $ | 2.11 | 4,012,378 | $ | 2.28 | ||||||||||||||||
Year ended December 31, 2014 | $0.35 - 6.55 | 4,289,631 | 6.03 | $ | 1.93 | 3,111,199 | $ | 2.11 | ||||||||||||||||
Total intrinsic value of | Total fair value of | |||||||||||||||||||||||
options exercised | options vested | |||||||||||||||||||||||
Year ended December 31, 2013 | $ | 111,595 | $ | 1,248,067 | ||||||||||||||||||||
Year ended December 31, 2014 | $ | 260,803 | $ | 821,392 | ||||||||||||||||||||
For the years ended December 31, 2013 and 2014, the weighted average grant date fair value of options granted was $0.87 and $1.23, respectively. We estimate the fair value of options at the grant date using the Black-Scholes-Merton model. | ||||||||||||||||||||||||
Restricted Stock Issuances | ||||||||||||||||||||||||
In 2013 and 2014, we issued 337,500 and 303,000, respectively, shares of restricted stock to certain employees. These shares vest in three equal annual installments on the first three anniversary dates of their grant. Accordingly, zero and 101,000 shares vested in 2013 and 2014, respectively. | ||||||||||||||||||||||||
The following table summarizes our restricted stock awards: | ||||||||||||||||||||||||
Number of Vested Shares | Number of Unvested Shares | Weighted Average Grant Date Fair Value | Aggregate Value of Vested Shares | Aggregate Value of Unvested Shares | ||||||||||||||||||||
Balance at January 1, 2013 | 23,765 | 15,123 | $ | 1.8 | $ | 42,777 | $ | 27,222 | ||||||||||||||||
Granted | — | 337,500 | $ | 1.26 | — | 425,250 | ||||||||||||||||||
Vested | 12,963 | (12,963 | ) | $ | 1.8 | 23,333 | (23,333 | ) | ||||||||||||||||
Exercised | — | — | $ | — | — | — | ||||||||||||||||||
Balance at December 31, 2013 | 36,728 | 339,660 | $ | 1.32 | 66,110 | 429,139 | ||||||||||||||||||
Granted | — | 303,000 | $ | 1.4 | — | 424,200 | ||||||||||||||||||
Vested | 114,660 | (114,660 | ) | $ | 1.27 | 145,639 | (145,639 | ) | ||||||||||||||||
Exercised | (22,725 | ) | — | $ | 1.26 | (28,634 | ) | — | ||||||||||||||||
Balance at December 31, 2014 | 128,663 | 528,000 | $ | 1.36 | $ | 183,115 | $ | 707,700 | ||||||||||||||||
We recognized $1.2 million and $0.9 million in stock-based compensation expense, which is recorded in selling, general and administrative expenses on the consolidated statement of operations for the years ended December 31, 2013 and 2014, respectively, and we will recognize $1.5 million over the remaining requisite service period. For all options granted through December 31, 2014, the weighted average remaining service period is 1.5 years. |
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Commitments and Contingencies Disclosure [Abstract] | ||||
Commitments and Contingencies | Commitments and Contingencies | |||
Obligation under Operating Leases | ||||
We lease facilities in Blacksburg, Charlottesville and Roanoke, Virginia under operating leases that as of December 31, 2014, were scheduled to expire between March 2015 and December 2020. Certain of the leases are subject to fixed escalations and provide for possible termination prior to their expiration dates. We recognize rent expense on such leases on a straight-line basis over the lease term. Rent expense under these leases recorded in selling, general and administrative expense on our statement of operations totaled approximately $1.0 million and $0.9 million, respectively, for the years ended December 31, 2013 and 2014. During 2014, we subleased a portion of the office space formerly occupied by Secure Computing and Communications group (“SCC”) to Mac-B. The amount of the sublease income recognized in 2014 was approximately $108,000. The sublease expired on April 30, 2014. | ||||
We are obligated under operating leases covering certain equipment that expire at various dates during the next two years. | ||||
Minimum future payments, as of December 31, 2014, under the aforementioned operating leases for each of the next five years are: | ||||
2015 | 995,312 | |||
2016 | 829,005 | |||
2017 | 837,053 | |||
2018 | 845,294 | |||
2019 | 535,720 | |||
Thereafter | 480,163 | |||
$ | 4,522,547 | |||
Purchase Commitment | ||||
In the fourth quarter of 2013 we executed two non-cancelable purchase orders totaling $1.4 million for multiple shipments of tunable lasers to be delivered over an 18-month period beginning in the fourth quarter of 2013. At December 31, 2014, approximately $0.5 million of this commitment remained. | ||||
Royalty Agreement | ||||
We have licensed certain third-party technologies from vendors for which we owe minimum royalties aggregating $1.5 million payable over the remaining patent terms of the underlying technology. |
Employee_Profit_Sharing_Plan
Employee Profit Sharing Plan | 12 Months Ended |
Dec. 31, 2014 | |
Compensation and Retirement Disclosure [Abstract] | |
Employee Profit Sharing Plan | Employee Profit Sharing Plan |
We maintain a salary reduction/profit-sharing plan under provisions of Section 401(k) of the Internal Revenue Code. The plan is offered to employees who have completed three months of service with us. We contribute 25% of the salary deferral elected by each employee up to a maximum deferral of 10% of annual salary. | |
We contributed approximately $175,000 and $150,000 to the plan for the years ended December 31, 2013 and 2014, respectively. |
Litigation_and_Other_Contingen
Litigation and Other Contingencies | 12 Months Ended |
Dec. 31, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | |
Litigation and Other Contingencies | Litigation and Other Contingencies |
From time to time, we may become involved in litigation in relation to claims arising out of our operations in the normal course of business. While management currently believes it is not reasonably possible the amount of ultimate liability, if any, with respect to these actions will have a material adverse effect on our financial position, results of operations or liquidity, the ultimate outcome of any litigation is uncertain. | |
After our announcement of the merger with API (see Note 17), three separate putative class action complaints were filed in Michigan and Delaware, alleging claims of breach of fiduciary duty against the API board of directors and naming Luna as a defendant for aiding and abetting the alleged breach of fiduciary duty. The plaintiffs seek injunctive relief and unspecified damages. We intend to defend ourselves vigorously in these actions. The possible range of monetary loss that might occur in the future in this matter, if any, is unknown at this time. | |
In September 2014, we received a preliminary audit report from the Defense Contract Audit Agency ("DCAA"), with respect to our 2007 incurred cost submission and questioning $0.8 million of claimed costs that the DCAA believes are expressly unallowable under the Federal Acquisition Regulations and, therefore, subject to potential penalty. We have not been informed of any actual claim for penalty by the Defense Contract management Agency and intend to contest such claim if received. | |
We have made, and will continue to make, efforts to comply with current and future environmental laws. We anticipate that we could incur additional capital and operating costs in the future to comply with existing environmental laws and new requirements arising from new or amended statutes and regulations. In addition, because the applicable regulatory agencies have not yet promulgated final standards for some existing environmental programs, we cannot at this time reasonably estimate the cost for compliance with these additional requirements. The amount of any such compliance costs could be material. We cannot predict the impact that future regulations will impose upon our business. |
Relationship_with_Major_Custom
Relationship with Major Customers | 12 Months Ended |
Dec. 31, 2014 | |
Risks and Uncertainties [Abstract] | |
Relationship with Major Customers | Relationship with Major Customers |
During the years ended December 31, 2013 and 2014, approximately 65% and 57%, respectively, of our consolidated revenues were attributable to contracts with the U.S. government. | |
At December 31, 2013 and 2014, receivables with respect to contracts with the U.S. government represented 25% and 29% of total billed trade receivables, respectively. |
Financial_Information_About_Se
Financial Information About Segments | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Segment Reporting [Abstract] | |||||||||
Financial Information About Segments | Financial Information About Segments | ||||||||
Our operations are divided into two operating segments: Technology Development and Products and Licensing. Our engineers and scientists collaborate with our network of government, academic and industry experts to identify technologies and ideas with promising market potential. We then compete to win fee-for-service contracts from government agencies and industrial customers who seek innovative solutions to practical problems that require new technology. The Technology Development segment derives its revenue primarily from services. The Technology Development segment provides applied research to customers in our areas of focus. | |||||||||
The Products and Licensing segment develops and sells products or licenses technologies based on commercially viable concepts developed by the Technology Development segment. The Products and Licensing segment derives its revenue from product sales, funded product development and technology licenses. | |||||||||
Our President and Chief Executive Officer and his direct reports collectively represent our chief operating decision makers, and they evaluate segment performance based primarily on revenue and operating income or loss. | |||||||||
Information about the results of operations for each segment is set forth in the table below. There were no significant inter-segment sales during the years ended December 31, 2013 and 2014. | |||||||||
During the years ended December 31, 2013 and 2014, 27% and 18%, respectively, of our total sales took place outside the United States. | |||||||||
Years ended December 31, | |||||||||
2013 | 2014 | ||||||||
Technology Development revenue | $ | 11,421,868 | $ | 12,205,889 | |||||
Products and Licensing revenue | 6,911,707 | 9,054,101 | |||||||
Total revenue | 18,333,575 | 21,259,990 | |||||||
Technology Development operating loss | (3,169,605 | ) | (1,964,216 | ) | |||||
Products and Licensing operating income (loss) | (4,865,741 | ) | (2,540,885 | ) | |||||
Total operating loss | (8,035,346 | ) | $ | (4,505,101 | ) | ||||
Depreciation, Technology Development | $ | 499,439 | $ | 317,925 | |||||
Depreciation, Products and Licensing | 266,327 | 235,831 | |||||||
Amortization, Technology Development | 212,790 | 219,156 | |||||||
Amortization, Products and Licensing | 113,471 | 162,565 | |||||||
Additional segment information is as follows: | |||||||||
December 31, | |||||||||
2013 | 2014 | ||||||||
Total segment assets: | |||||||||
Technology Development | $ | 12,275,693 | $ | 15,836,918 | |||||
Products and Licensing | 7,428,382 | 11,747,530 | |||||||
Total | $ | 19,704,075 | $ | 27,584,448 | |||||
Property plant and equipment and intangible assets, Technology Development | $ | 1,463,548 | $ | 2,122,157 | |||||
Property plant and equipment and intangible assets, Products and Licensing | $ | 885,636 | $ | 1,574,177 | |||||
Quarterly_Results_unaudited
Quarterly Results (unaudited) | 12 Months Ended | |||||||||||||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ||||||||||||||||||||||||||||||||
Quarterly Results (unaudited) | Quarterly Results (unaudited) | |||||||||||||||||||||||||||||||
The following table sets forth our unaudited historical revenues, operating loss and net (loss) income by quarter during 2013 and 2014. | ||||||||||||||||||||||||||||||||
Quarter Ended | ||||||||||||||||||||||||||||||||
(Dollars in thousands, | March 31, | June 30, | September 30, | December 31, | March 31, | June 30, | September 30, | December 31, | ||||||||||||||||||||||||
except per share amounts) | 2013 | 2013 | 2013 | 2013 | 2014 | 2014 | 2014 | 2014 | ||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||
Technology | $ | 2,627 | $ | 2,807 | $ | 3,130 | $ | 2,858 | $ | 2,675 | $ | 3,219 | $ | 3,067 | $ | 3,245 | ||||||||||||||||
Products and licensing | 1,478 | 2,024 | 1,569 | 1,841 | 1,796 | 2,009 | 2,304 | 2,945 | ||||||||||||||||||||||||
Total revenues | 4,105 | 4,831 | 4,699 | 4,699 | 4,471 | 5,228 | 5,371 | 6,190 | ||||||||||||||||||||||||
Gross margin | 1,135 | 1,777 | 1,677 | 1,460 | 1,552 | 1,988 | 2,083 | 2,214 | ||||||||||||||||||||||||
Operating loss | (2,241 | ) | (1,739 | ) | (1,302 | ) | (2,753 | ) | (1,952 | ) | (963 | ) | (720 | ) | (870 | ) | ||||||||||||||||
Loss from continuing operations | (1,319 | ) | (1,035 | ) | (775 | ) | (2,379 | ) | (1,133 | ) | (585 | ) | (467 | ) | (1,932 | ) | ||||||||||||||||
Income/(loss) from discontinued operations net of income taxes | 4,105 | 83 | 161 | 356 | 9,673 | (331 | ) | (278 | ) | (329 | ) | |||||||||||||||||||||
Net loss | 2,786 | (952 | ) | (614 | ) | (2,023 | ) | 8,540 | (916 | ) | (745 | ) | (884 | ) | ||||||||||||||||||
Net (loss)/income attributable to common stockholders | $ | 2,762 | $ | (978 | ) | $ | (640 | ) | $ | (2,049 | ) | $ | 8,511 | $ | (943 | ) | $ | (771 | ) | $ | (914 | ) | ||||||||||
Net loss per share from continuing operations: | ||||||||||||||||||||||||||||||||
Basic and diluted | $ | (0.09 | ) | $ | (0.07 | ) | $ | (0.05 | ) | $ | (0.16 | ) | $ | (0.08 | ) | $ | (0.04 | ) | $ | (0.03 | ) | $ | (0.13 | ) | ||||||||
Net income/(loss) per share from discontinued operations: | ||||||||||||||||||||||||||||||||
Basic and diluted | $ | 0.29 | $ | 0.01 | $ | 0.01 | $ | 0.02 | $ | 0.66 | $ | (0.02 | ) | $ | (0.02 | ) | $ | (0.02 | ) | |||||||||||||
Net (loss)/income attributable to common stockholders: | ||||||||||||||||||||||||||||||||
Basic and diluted | $ | 0.2 | $ | (0.07 | ) | $ | (0.04 | ) | $ | (0.14 | ) | $ | 0.58 | $ | (0.06 | ) | $ | (0.05 | ) | $ | (0.06 | ) | ||||||||||
Weighted average shares: | ||||||||||||||||||||||||||||||||
Basic and diluted | 14,011,814 | 14,362,494 | 14,441,707 | 14,488,060 | 14,653,262 | 14,817,084 | 15,016,429 | 15,056,007 | ||||||||||||||||||||||||
Discontinued_Operations
Discontinued Operations | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Discontinued Operations and Disposal Groups [Abstract] | |||||||||
Discontinued Operations | Discontinued Operations | ||||||||
On March 1, 2013, we completed the sale of our SCC which was part of our Technology Development segment, to an unaffiliated third party for a gross sales price of $6.1 million in cash. Prior to the sale, SCC provided innovative solutions designed to secure critical technologies within the U.S. government. SCC conducted applied research and provided services to the government in this area, with its revenues primarily derived from U.S. government contracts and purchase orders. Of the purchase price, we received approximately $5.4 million at closing and $110,000 on December 31, 2013. During December 2013, an additional $475,000 in purchase price was released to us from escrow and another $125,000 is in escrow and may be released 18 months after the closing of the transaction, subject to any indemnification claims of the acquirer. In connection with the sale, we incurred approximately $0.9 million in transaction costs that included various charges related to investment banker and legal fees. In addition, the acquirer has entered into a sublease with us for the facilities historically occupied by SCC through April 30, 2014 for a total of $0.4 million. In the transaction, we sold the equipment, contracts and intellectual property associated with SCC. Approximately 20 employees of SCC transferred to the acquirer. Included in the transaction were current assets of approximately $0.2 million and long term assets with a net book value of approximately $0.1 million, at February 28, 2013. We recorded an aggregate after-tax gain on the sale of SCC of $9.3 million or $0.63 per diluted share in our results of operations for the year ended December 31, 2013. | |||||||||
Following the sale of SCC, we have continued to act on behalf of the purchaser and bill the government for certain contracts that have not yet been transferred by the government to the purchaser. We record these amounts as revenues, with an offsetting amount as cost of revenues, within (loss)/income from discontinued operations. During the year ended December 31, 2013, this amount was $1.7 million. We expect to continue recording such revenues and costs until all of these contracts are transferred to the purchaser by the government. | |||||||||
On January 21, 2014, we sold our assets associated with the development of fiber optic shape sensing and localization for the medical field to affiliates of Intuitive Surgical, Inc.("Intuitive"), for total cash consideration of up to $30 million, including $6 million received at closing, and $6 million to be received within 90 days of closing, and up to $18 million that may be received in the future based on the achievement of certain technical milestones and royalties on system sales, if any. In the transaction, we sold equipment and intellectual property associated with our shape sensing technology. Ten employees were transferred to Intuitive. Included in the transaction were current assets of totaling approximately $0.2 million and long term assets with a net book value of approximately $0.2 million, at December 31, 2013. Our fiber optic shape sensing and localization for the medical field accounted for approximately 12% of our revenues, and 9% of our cost of revenues for the year ended December 31, 2013. | |||||||||
We have reported the results of operations of SCC and our medical shape sensing business as discontinued operations in our consolidated financial statements. We allocated a portion of the consolidated tax expense to discontinued operations based on the ratio of the discontinued groups’ income or loss before allocations. | |||||||||
The key components of income/(loss) from discontinued operations were as follows: | |||||||||
Years ended December 31, | |||||||||
2013 | 2014 | ||||||||
Net revenues | $ | 5,909,375 | $ | — | |||||
Cost of revenues | 3,486,200 | 46,204 | |||||||
Operating expenses | 229,745 | — | |||||||
Income/(loss) before income taxes | 2,193,430 | (46,204 | ) | ||||||
Allocated tax expense/(benefit) | 879,819 | (11,713 | ) | ||||||
Operating income/(loss) from discontinued operations | 1,313,611 | (34,491 | ) | ||||||
Gain on sale, net of $1.5 million and $1.3 million of related income taxes | 3,391,639 | 9,381,948 | |||||||
Income from discontinued operations, net of income taxes | $ | 4,705,250 | $ | 9,347,457 | |||||
Subsequent_Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2014 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events |
On January 30, 2015, we entered into an agreement to merge with Advanced Photonix, Inc. (“API”), subject to approval by the stockholders of both companies and customary closing conditions. The merger agreement may be terminated by either us or API in certain circumstances, including if the merger has not been consummated on or before August 31, 2015, if the approval of the stockholders of either Luna or API is not obtained, and for breaches of certain representations and warranties. If the merger agreement is terminated in certain specified circumstances, API must pay us, or we must pay API, as applicable, a termination fee of $750,000. In addition, if the merger agreement is terminated following a meeting of the stockholders of Luna or API at which the adoption of the merger agreement and approval of the transactions contemplated thereby, or the approval of the issuance of shares of Luna Innovations common stock as consideration in the merger is considered but not approved, then we or API, as applicable, will be required to pay an amount up to $250,000 in reimbursement of the other party’s out-of-pocket expenses incurred in connection with the transaction. Upon the completion of the merger, stockholders of API will receive 0.31782 share of Luna Innovations common stock for each outstanding share of API common stock, resulting in the current stockholders of Luna owning approximately 56% of the outstanding common stock of the combined entity. | |
API is a leading test and measurement company that packages optoelectronic semiconductors into high-speed optical receivers ("HSOR products"), custom optoelectronic subsystems ("Optosolutions products") and Terahertz ("THz products") instrumentation, serving the test and measurement, telecommunications, military/aerospace and medical markets. | |
On January 20, 2015 we amended the leases for our Blacksburg and Roanoke facilities. The amendment to our Blacksburg lease increased by approximately $1.1 million the value of leasehold improvements to be provided by the landlord and extended the term of the lease for an additional four years. The amendment to the Roanoke lease with Carilion Clinic properties, LLC provides for early termination of the lease with 30 days' notice, without penalty, and that in any event the lease would terminate no later than on April 30, 2015. On March 12, 2015, we provided notice to Carilion Clinic Properties, LLC of our election to terminate the Roanoke lease effective April 15, 2015. |
Valuation_and_Qualifying_Accou
Valuation and Qualifying Accounts | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||
Valuation and Qualifying Accounts [Abstract] | ||||||||||||||||||||
Valuation and Qualifying Accounts | Schedule II | |||||||||||||||||||
Luna Innovations Incorporated | ||||||||||||||||||||
Valuation and Qualifying Accounts | ||||||||||||||||||||
Column A | Column B | Column C | Column D | Column E | Column F | |||||||||||||||
Balance | Charged | Deductions | Valuation | Balance at | ||||||||||||||||
at beginning | to costs | against | end | |||||||||||||||||
of Period | and | asset | of period | |||||||||||||||||
expenses | ||||||||||||||||||||
Year Ended December 31, 2013 | ||||||||||||||||||||
Reserves deducted from assets to which they apply: | ||||||||||||||||||||
Inventory obsolescence | $ | 86,186 | $ | — | $ | (11,435 | ) | $ | — | $ | 74,751 | |||||||||
Allowances for doubtful Accounts | $ | — | $ | 134,811 | $ | — | $ | — | $ | 134,811 | ||||||||||
$ | 86,186 | $ | 134,811 | $ | (11,435 | ) | $ | — | $ | 209,562 | ||||||||||
Year Ended December 31, 2014 | ||||||||||||||||||||
Reserves deducted from assets to which they apply: | ||||||||||||||||||||
Inventory obsolescence | $ | 74,751 | $ | 166,773 | $ | (2,775 | ) | $ | — | $ | 238,749 | |||||||||
Allowances for doubtful Accounts | $ | 134,811 | $ | — | $ | — | $ | — | $ | 134,811 | ||||||||||
$ | 209,562 | $ | 166,773 | $ | (2,775 | ) | $ | — | $ | 373,560 | ||||||||||
All other schedules are omitted as the required information is inapplicable or the information is presented in the Consolidated Financial Statements and notes thereto in Item 8 of Part II of this Annual Report on Form 10-K. | ||||||||||||||||||||
-3 | Exhibits. The exhibits filed as part of this report are listed under “Exhibits” at subsection (b) of this Item 15. | |||||||||||||||||||
(b) | Exhibits |
Organization_and_Summary_of_Si1
Organization and Summary of Significant Accounting Policies (Policies) | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||
Nature of Operations | Luna Innovations Incorporated (“we” or the "Company”), headquartered in Roanoke, Virginia was incorporated in the Commonwealth of Virginia in 1990 and reincorporated in the State of Delaware in April 2003. | ||||
We develop, manufacture and market fiber optic sensing and test & measurement products focused on bringing new and innovative technology solutions to measure, monitor, protect and improve critical processes in the aerospace, automotive, energy, composite, telecommunications and defense industries. Our business model is designed to accelerate the process of bringing new and innovative products to market. We use our in-house technical expertise to perform applied research services on government-funded projects across a range of technologies and also for corporate customers in the fiber optic sensing area. We are organized into two business segments: our Technology Development segment and our Products and Licensing segment. Our Technology Development segment performs applied research principally on government-funded projects. Most of the government funding in our Technology Development segment is derived from the U.S. Government’s Small Business Innovation Research ("SBIR") program coordinated by the U.S. Small Business Administration ("SBA"). Our Products and Licensing segment focuses on fiber optic test and measurement, sensing, and instrumentation products and also conducts applied research in the fiber optic sensing area to corporate and government customers. The Products and Licensing segment focuses on fiber optic test and measurement, sensing and instrumentation products. | |||||
We have a history of net losses and negative cash flow from operations. We have historically managed our liquidity through cost reduction initiatives, debt financings, capital markets transactions and the sale of assets. | |||||
Although there can be no guarantees, we believe that our current cash and cash equivalents balance, provides adequate liquidity for us to meet our working capital needs through 2015. | |||||
Consolidation Policy | Consolidation Policy | ||||
Our consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States ("GAAP") and include the accounts of the Company and its wholly owned subsidiaries. We eliminate from our financial results all significant intercompany transactions. | |||||
Use of Estimates | Use of Estimates | ||||
The preparation of our consolidated financial statements in accordance with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities in our consolidated financial statements and accompanying notes. | |||||
Although these estimates are based on our knowledge of current events and actions we may undertake in the future, actual results may differ from such estimates and assumptions. | |||||
Technology Development Revenues | Technology Development Revenues | ||||
We perform research and development for U.S. government agencies, educational institutions and commercial organizations. We recognize revenues under research contracts when a contract has been executed, the contract price is fixed and determinable, delivery of services or products has occurred and collection of the contract price is considered reasonably assured. Revenue is earned under cost reimbursable, time and materials and fixed price contracts. Direct contract costs are expensed as incurred. | |||||
Under cost reimbursable contracts, we are reimbursed for costs that are determined to be reasonable, allowable and allocable to the contract and are paid a fixed fee representing the profit negotiated between us and the contracting agency. Revenue from cost reimbursable contracts is recognized as costs are incurred plus a portion of the fee earned. Revenue from time and materials contracts is recognized based on direct labor hours expended at contract billing rates plus other billable direct costs. | |||||
Revenue from fixed price research contracts that involve the delivery of services and a prototype model is recognized under the percentage of completion method. Fixed price arrangements that involve the delivery of research reports are recognized under the proportional performance method based upon the ratio of costs incurred to achieve contract milestones to total estimated cost as this method more accurately measures performance under these arrangements. Losses on contracts, if any, are recognized in the period in which they become known and estimable. | |||||
Intellectual Property License Revenues | Intellectual Property License Revenues | ||||
Amounts received from third parties for licenses to our intellectual property are recognized when earned under the terms of the agreements. Revenues are recognized upon transfer of the license unless we have continuing obligations for which fair value cannot be established, in which case the revenues are recognized over the period of the obligation. If there are extended payment terms, license fee revenues are recognized as these payments become due and collection is reasonably assured. We consider all arrangements with payment terms extending beyond 12 months not to be fixed and determinable. | |||||
Certain of our license arrangements have also required us to enter into research and development agreements. Accordingly, we allocate our arrangement fees to the various elements based upon objective reliable evidence of fair value, if available. For those arrangements in which evidence of fair value is not available, we defer revenues from any up-front payments and recognize them over the service period in the arrangement. Certain of these arrangements also include the payment of performance bonuses based upon the achievement of specific milestones. Generally, there are no assurances at the onset of these arrangements that the milestones will be achieved. As such, fees related to such milestones are excluded from the initial allocation of the arrangement fee and are recognized upon achievement of the milestone provided that all other revenue recognition criteria are met. | |||||
Product Sales Revenues | Product Sales Revenues | ||||
Revenues from product sales are generated by the sale of commercial products and services under various sales programs to the end user and through distribution channels. We sell fiber optic sensing systems to end users for use in numerous fiber optic based measurement applications. Revenues are recorded net of applicable sales taxes collected from customers and payable to state or local governmental entities. | |||||
We recognize revenue relating to our products when persuasive evidence of an arrangement exists, delivery has occurred, the selling price is fixed or determinable and collectability of the resulting receivable is reasonably assured. | |||||
For multi-element arrangements that include tangible products that contain software that is essential to the tangible product’s functionality, we allocate revenue to all deliverables based on their relative selling prices. Other deliverables include extended warranty, training and various add-on products. In such circumstances, we use a hierarchy to determine the selling price to be used for allocating revenue to deliverables: (i) vendor-specific objective evidence of fair value ("VSOE"), (ii) third-party evidence of selling price ("TPE"), and (iii) best estimate of the selling price ("ESP"). VSOE generally exists only when we sell the deliverable separately and is the price actually charged by us for that deliverable. Due to the uniqueness of our products comparable third party evidence is generally not available. ESPs reflect our best estimates of what the selling prices of elements would be if they were sold regularly on a stand-alone basis. | |||||
Our process for determining our ESP for deliverables without VSOE or TPE considers multiple factors that may vary depending upon the unique facts and circumstances related to each deliverable. Key factors considered in developing the ESPs include prices charged by us for similar offerings, our historical pricing practices, the nature of the deliverables, and the relative ESP of all of the deliverables as compared to the total selling price of the product. We may also consider, when appropriate, the impact of other products and services on selling price assumptions when developing and reviewing our ESPs. | |||||
Revenues from product sales that require no ongoing obligations are recognized as revenues when shipped to the customer, title has passed and collection is reasonably assured. In transactions in which a right-of-return exists, revenues are deferred until acceptance has occurred and the period for the right-of-return has expired. | |||||
Allowance for Uncollectible Receivables | Allowance for Uncollectible Receivables | ||||
Accounts receivable are recorded at their face amount, less an allowance for doubtful accounts. We review the status of our uncollected receivables on a regular basis. In determining the need for an allowance for uncollectible receivables, we consider our customers’ financial stability, past payment history and other factors that bear on the ultimate collection of such amounts. | |||||
Cash Equivalents | Cash Equivalents | ||||
We consider all highly liquid investments purchased with maturities of three months or less to be cash equivalents. To date, we have not incurred losses related to cash and cash equivalents. The Company’s cash transactions are processed through reputable commercial banks. To date, the Company has not incurred losses related to cash and cash equivalents. The Company regularly maintains cash balances with financial institutions which exceed Federal Deposit Insurance Corporation (“FDIC”) insurance limits. | |||||
Fair Value Measurements | Fair Value Measurements | ||||
The Company’s financial assets and liabilities are measured at fair value, which is defined as the price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants. Valuation techniques are based on observable or unobservable inputs. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company’s market assumptions. These two types of inputs have created the following fair value hierarchy: | |||||
• | Level 1—Quoted prices for identical instruments in active markets. | ||||
• | Level 2—Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which significant value drivers are observable. | ||||
• | Level 3—Valuations derived from valuation techniques in which significant value drivers are unobservable. | ||||
The carrying values of cash and cash equivalents, accounts receivable and accounts payable approximate fair value because of the short-term nature of these instruments. | |||||
Property and Equipment | Property and Equipment | ||||
Property and equipment are stated at cost less accumulated depreciation. We record depreciation using the straight-line method over the following estimated useful lives: | |||||
Equipment | 3 – 7 years | ||||
Furniture and fixtures | 7 years | ||||
Software | 3 years | ||||
Leasehold improvements | Lesser of lease term or life of improvements | ||||
Intangible Assets | Intangible Assets | ||||
Intangible assets consist of patents related to certain intellectual property that we have developed or acquired. We amortize our patents over their estimated useful life of five years, and analyze them whenever events or circumstances indicate that the carrying amount may not be recoverable to determine whether their carrying value has been impaired. | |||||
Research, Development and Engineering | Research, Development and Engineering | ||||
Research, development and engineering expenses not related to contract performance are expensed as incurred. | |||||
Valuation of Long-Lived Assets | Valuation of Long-Lived Assets | ||||
We review our long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets is measured by comparing the carrying amount of an asset to future undiscounted net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds their fair value. Assets to be disposed of by sale are reflected at the lower of their carrying amount or fair value less cost to sell. | |||||
Inventory | Inventory | ||||
Inventory consists of finished goods, work in process and raw materials valued at the lower of cost (determined on the first-in, first-out basis) or market. We provide reserves for estimated obsolescence or unmarketable inventory equal to the difference between the carrying value of the inventory and the estimated market value based upon assumptions about future demand and market conditions. | |||||
Net (Loss)/Income per Share | Net (Loss)/Income per Share | ||||
Basic per share data is computed by dividing net (loss)/income attributable to common stockholders by the weighted average number of shares outstanding during the period. Diluted per share data is computed by dividing net (loss)/income attributable to common stockholders by the weighted average shares outstanding during the period increased to include, if dilutive, the number of additional common share equivalents that would have been outstanding if potential common shares had been issued using the treasury stock method. Diluted per share data would also include the potential common share equivalents relating to convertible securities by application of the if-converted method. | |||||
The effect of 2.3 million common stock equivalents (which include outstanding warrants, preferred stock and stock options) are not included for the years ended December 31, 2013 and 2014, as they are antidilutive to earnings per share due to the Company having a net loss from continuing operations. | |||||
Stock-Based Compensation | Stock-Based Compensation | ||||
We have a stock-based compensation plan, which is described further in Note 9. We recognize compensation expense based upon the fair value of the underlying equity award as of the date of grant. The Company has elected to use the Black-Scholes option pricing model to value any awards granted. We recognize stock-based compensation for such awards on a straight-line method over the requisite service period of the awards taking into account the effects of the employees’ expected exercise and post-vesting employment termination behavior. | |||||
The Company recognizes expense for equity instruments issued to non-employees based upon the fair value of the equity instruments issued. | |||||
The fair value of each option granted is estimated as of the grant date using the Black-Scholes option pricing model with the following assumptions: | |||||
Years ended December 31, | |||||
2013 | 2014 | ||||
Risk-free interest rate range | 1.27% – 2.34% | 2.02% – 2.27% | |||
Expected life of option-years | 7.5 | 7.5 | |||
Expected stock price volatility | 108% | 106% | |||
Executive turnover rates | —% | —% | |||
Non-executive turnover rates | 14.70% | 33.60% | |||
Expected dividend yield | —% | —% | |||
The risk-free interest rate is based on U.S. Treasury interest rates, the terms of which are consistent with the expected life of the stock options. Expected volatility is based upon the average historical volatility of our common stock over the period commensurate with the expected term of the related instrument. The expected life and estimated post-employment termination behavior is based upon historical experience of homogeneous groups, executives and non-executes, within our company. We do not currently pay dividends on our common stock nor do we expect to in the foreseeable future. | |||||
Advertising | Advertising | ||||
We expense the cost of advertising as incurred. Historically such amounts have not been significant to our operations. | |||||
Income Taxes | Income Taxes | ||||
We account for income taxes using the liability method. Deferred tax assets or liabilities are determined based on the difference between the financial statement and tax basis of assets and liabilities as measured by the enacted tax rates which will be in effect when the differences reverse. A valuation allowance against net deferred tax assets is provided unless we conclude it is more likely than not that the deferred tax assets will be realized. | |||||
We recognize tax benefits from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by taxing authorities. |
Organization_and_Summary_of_Si2
Organization and Summary of Significant Accounting Policies (Tables) | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||
Property and Equipment Estimated Useful Lives | Property and equipment are stated at cost less accumulated depreciation. We record depreciation using the straight-line method over the following estimated useful lives: | ||||
Equipment | 3 – 7 years | ||||
Furniture and fixtures | 7 years | ||||
Software | 3 years | ||||
Leasehold improvements | Lesser of lease term or life of improvements | ||||
Assumptions Used to Estimate Fair Value of Option Granted | The fair value of each option granted is estimated as of the grant date using the Black-Scholes option pricing model with the following assumptions: | ||||
Years ended December 31, | |||||
2013 | 2014 | ||||
Risk-free interest rate range | 1.27% – 2.34% | 2.02% – 2.27% | |||
Expected life of option-years | 7.5 | 7.5 | |||
Expected stock price volatility | 108% | 106% | |||
Executive turnover rates | —% | —% | |||
Non-executive turnover rates | 14.70% | 33.60% | |||
Expected dividend yield | —% | —% |
Inventory_Tables
Inventory (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Inventory Disclosure [Abstract] | ||||||||
Components of Inventory | Components of inventory are as follows: | |||||||
31-Dec-13 | 31-Dec-14 | |||||||
Finished goods | $ | 719,574 | $ | 648,182 | ||||
Work-in-process | 361,754 | 262,025 | ||||||
Raw materials | 2,339,595 | 2,692,765 | ||||||
3,420,923 | 3,602,972 | |||||||
Less: Inventory reserves | 74,746 | 238,739 | ||||||
Total inventory, net | $ | 3,346,177 | $ | 3,364,233 | ||||
Debt_Tables
Debt (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Debt Disclosure [Abstract] | |||||||||
Summary of Debt Outstanding | The following table presents a summary of debt outstanding as of December 31, 2013 and 2014: | ||||||||
December 31, | |||||||||
2013 | 2014 | ||||||||
Silicon Valley Bank Term Loan | $ | 2,125,000 | $ | 625,000 | |||||
Less: current portion | 1,500,000 | 625,000 | |||||||
Total long-term debt | $ | 625,000 | $ | — | |||||
Maturities On Long-term Debt | Maturities on long-term debt are as follows: | ||||||||
Year | Amount | ||||||||
2015 | 625,000 | ||||||||
Total | $ | 625,000 | |||||||
Costs Associated with Loans Outstanding | Costs associated with loans outstanding were as follows: | ||||||||
Years ended December 31, | |||||||||
2013 | 2014 | ||||||||
Interest expense | $ | 189,151 | $ | 87,426 | |||||
Amortization of transaction costs | 18,387 | 8,803 | |||||||
Total interest expense | $ | 207,538 | $ | 96,229 | |||||
Accounts_ReceivableTrade_Table
Accounts Receivable-Trade (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Receivables [Abstract] | ||||||||
Components of Accounts Receivable | Accounts receivable consist of the following: | |||||||
December 31, | ||||||||
2013 | 2014 | |||||||
Billed | $ | 3,552,184 | $ | 4,517,672 | ||||
Unbilled | 1,755,439 | 1,249,814 | ||||||
Other | 235,469 | 56,940 | ||||||
$ | 5,543,092 | $ | 5,824,426 | |||||
Less: allowance for doubtful accounts | (134,811 | ) | (134,811 | ) | ||||
$ | 5,408,281 | $ | 5,689,615 | |||||
Property_and_Equipment_Tables
Property and Equipment (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Property, Plant and Equipment [Abstract] | ||||||||
Property Plant and Equipment Net | Property and equipment, net, consists of the following at: | |||||||
December 31, | ||||||||
2013 | 2014 | |||||||
Building | $ | 69,556 | $ | 69,556 | ||||
Equipment | 7,239,017 | 7,312,730 | ||||||
Furniture and fixtures | 562,485 | 562,485 | ||||||
Software | 1,092,484 | 1,092,484 | ||||||
Leasehold improvements | 3,168,377 | 4,830,055 | ||||||
12,131,919 | 13,867,310 | |||||||
Less—accumulated depreciation | (10,071,210 | ) | (10,370,253 | ) | ||||
$ | 2,060,709 | $ | 3,497,057 | |||||
Intangible_Assets_Tables
Intangible Assets (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||
Summary of Intangible Assets | The following is a summary of intangible assets, net: | |||||||
December 31, | ||||||||
2013 | 2014 | |||||||
Patent costs | $ | 2,496,560 | $ | 2,356,820 | ||||
Accumulated amortization | (2,208,085 | ) | (2,157,543 | ) | ||||
$ | 288,475 | $ | 199,277 | |||||
Estimated Aggregate Amortization Based On Net Value Of Intangible Assets | Estimated aggregate amortization, based on the net value of intangible assets at December 31, 2014, for each of the next five years is as follows: | |||||||
Year Ending December 31, | ||||||||
2015 | 91,285 | |||||||
2016 | 53,342 | |||||||
2017 | 29,218 | |||||||
2018 | 15,137 | |||||||
2019 | 2,210 | |||||||
$ | 191,192 | |||||||
Accrued_Liabilities_Accrued_Li1
Accrued Liabilities Accrued Liabilities (Tables) | 12 Months Ended | ||||||
Dec. 31, 2014 | |||||||
Payables and Accruals [Abstract] | |||||||
Schedule of Accrued Liabilities | |||||||
December 31, | |||||||
2013 | 2014 | ||||||
Accrued compensation | 2,205,612 | 2,362,608 | |||||
Accrued sub-contracts | 297,510 | 244,218 | |||||
Accrued professional fees | 279,991 | 177,712 | |||||
Accrued income tax | 13,143 | 166,550 | |||||
Deferred rent | 102,569 | 1,752,717 | |||||
Royalties | 291,442 | 392,945 | |||||
Warranty reserve | 56,700 | 69,264 | |||||
Claims reserve | 92,167 | — | |||||
Accrued liabilities - other | 207,451 | 370,308 | |||||
Total Accrued Liabilities | 3,546,585 | 5,536,322 | |||||
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
Income Tax Disclosure [Abstract] | ||||||||||||||||
Components of Income Tax Expense | The benefit from income taxes from continuing operations consisted of the following for the periods indicated: | |||||||||||||||
Years ended December 31, | ||||||||||||||||
2013 | 2014 | |||||||||||||||
Current: | ||||||||||||||||
Federal | $ | (2,387,422 | ) | $ | (1,146,447 | ) | ||||||||||
State | — | 9,219 | ||||||||||||||
Deferred Federal | — | — | ||||||||||||||
Deferred State | — | — | ||||||||||||||
Income tax benefit | $ | (2,387,422 | ) | $ | (1,137,228 | ) | ||||||||||
Deferred Tax Assets and Liabilities | Deferred tax assets and liabilities consist of the following components: | |||||||||||||||
December 31, 2013 | December 31, 2014 | |||||||||||||||
Current | Long-Term | Current | Long-Term | |||||||||||||
Bad debt and inventory reserve | $ | 88,077 | $ | — | $ | 150,330 | $ | — | ||||||||
Deferred revenue | — | 59,673 | — | 126,096 | ||||||||||||
Depreciation and amortization | — | 1,024,746 | — | 309,600 | ||||||||||||
Net operating loss carryforwards | — | 10,897,715 | — | 8,030,396 | ||||||||||||
Research and development credits | — | 386,161 | — | 386,161 | ||||||||||||
Accrued liabilities | 836,049 | — | 1,584,633 | — | ||||||||||||
Deferred compensation | — | 163,655 | — | 199,717 | ||||||||||||
Stock-based compensation | — | 1,519,513 | — | 1,695,868 | ||||||||||||
AMT credit | — | 42,636 | — | 207,648 | ||||||||||||
Total | 924,126 | 14,094,099 | 1,734,963 | 10,955,486 | ||||||||||||
Valuation allowance | (924,126 | ) | (14,094,099 | ) | (1,734,963 | ) | (10,955,486 | ) | ||||||||
Net deferred tax asset | $ | — | $ | — | $ | — | $ | — | ||||||||
Reconciliation of Expected Income Tax Benefit (Expense) to Actual Income Tax Expense Benefit (Expense) | The benefit from income taxes from continuing operations differs from the amount computed by applying the federal statutory income tax rate to the Company’s loss from continuing operations before income taxes as follows for the periods indicated: | |||||||||||||||
Years ended December 31, | ||||||||||||||||
2013 | 2014 | |||||||||||||||
Income tax expense at federal statutory rate | 34 | % | 34 | % | ||||||||||||
State taxes, net of federal tax effects | 3.96 | % | 3.75 | % | ||||||||||||
Change in valuation allowance | (3.78 | )% | (8.02 | )% | ||||||||||||
Incentive stock options | (4.12 | )% | (3.33 | )% | ||||||||||||
Provision to return adjustments | 2.43 | % | (0.34 | )% | ||||||||||||
Meals and entertainment | (0.13 | )% | (0.27 | )% | ||||||||||||
Other Permanent differences | (2.12 | )% | (0.46 | )% | ||||||||||||
Income tax benefit | 30.24 | % | 25.33 | % |
Stockholders_Equity_Tables
Stockholders' Equity (Tables) | 12 Months Ended | |||||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||||
Equity [Abstract] | ||||||||||||||||||||||||
Activity of Restricted Stock | The following table summarizes our restricted stock awards: | |||||||||||||||||||||||
Number of Vested Shares | Number of Unvested Shares | Weighted Average Grant Date Fair Value | Aggregate Value of Vested Shares | Aggregate Value of Unvested Shares | ||||||||||||||||||||
Balance at January 1, 2013 | 23,765 | 15,123 | $ | 1.8 | $ | 42,777 | $ | 27,222 | ||||||||||||||||
Granted | — | 337,500 | $ | 1.26 | — | 425,250 | ||||||||||||||||||
Vested | 12,963 | (12,963 | ) | $ | 1.8 | 23,333 | (23,333 | ) | ||||||||||||||||
Exercised | — | — | $ | — | — | — | ||||||||||||||||||
Balance at December 31, 2013 | 36,728 | 339,660 | $ | 1.32 | 66,110 | 429,139 | ||||||||||||||||||
Granted | — | 303,000 | $ | 1.4 | — | 424,200 | ||||||||||||||||||
Vested | 114,660 | (114,660 | ) | $ | 1.27 | 145,639 | (145,639 | ) | ||||||||||||||||
Exercised | (22,725 | ) | — | $ | 1.26 | (28,634 | ) | — | ||||||||||||||||
Balance at December 31, 2014 | 128,663 | 528,000 | $ | 1.36 | $ | 183,115 | $ | 707,700 | ||||||||||||||||
Activity of Stock Options | The following table sets forth the activity of the options to purchase common stock under the 2003 Plan and the 2006 Plan. The prices represent the closing price of our Common Stock on the NASDAQ Capital Market on the respective dates. | |||||||||||||||||||||||
Options Outstanding | Options Exercisable | |||||||||||||||||||||||
Number of | Price per | Weighted | Aggregate | Number of | Weighted | Aggregate | ||||||||||||||||||
Shares | Share Range | Average | Intrinsic | Shares | Average | Intrinsic | ||||||||||||||||||
Exercise | Value (1) | Exercise | Value (1) | |||||||||||||||||||||
Price | Price | |||||||||||||||||||||||
Balance at January 1, 2013 | 5,422,130 | $0.35–6.74 | $ | 2.19 | $ | 639,904 | 3,775,388 | $ | 2.37 | $ | 604,292 | |||||||||||||
Forfeited | (693,644 | ) | 0.35–6.74 | 2.08 | ||||||||||||||||||||
Exercised | (137,097 | ) | 0.35–1.18 | 0.56 | ||||||||||||||||||||
Granted | 687,840 | 1.20–1.31 | 1.29 | |||||||||||||||||||||
Balance at December 31, 2013 | 5,279,229 | $0.35 - 6.55 | $ | 2.11 | $ | 784,154 | 4,012,378 | $ | 2.28 | $ | 697,826 | |||||||||||||
Forfeited | (1,660,354 | ) | $0.35 - 6.55 | 2.22 | ||||||||||||||||||||
Exercised | (321,696 | ) | $0.35 - 1.27 | 0.73 | ||||||||||||||||||||
Granted | 992,452 | $1.37 - 1.53 | 1.43 | |||||||||||||||||||||
Balance at December 31, 2014 | 4,289,631 | $0.35 - 6.55 | $ | 1.93 | $ | 512,901 | 3,111,199 | $ | 2.11 | $ | 453,032 | |||||||||||||
-1 | The intrinsic value of an option represents the amount by which the market value of the stock exceeds the exercise price of the option of in-the-money options only. | |||||||||||||||||||||||
Activity of Stock Option by Exercise Price Range | ||||||||||||||||||||||||
Options Outstanding | Options Exercisable | |||||||||||||||||||||||
Range of | Options | Weighted | Weighted | Options | Weighted | |||||||||||||||||||
Exercise Prices | Outstanding | Average | Average | Exercisable | Average | |||||||||||||||||||
Remaining | Exercise | Exercise | ||||||||||||||||||||||
Life in | Price | Price of | ||||||||||||||||||||||
Years | Options | |||||||||||||||||||||||
Exercisable | ||||||||||||||||||||||||
Year ended December 31, 2013 | $0.35 - 6.55 | 5,279,229 | 5.88 | $ | 2.11 | 4,012,378 | $ | 2.28 | ||||||||||||||||
Year ended December 31, 2014 | $0.35 - 6.55 | 4,289,631 | 6.03 | $ | 1.93 | 3,111,199 | $ | 2.11 | ||||||||||||||||
Total intrinsic value of | Total fair value of | |||||||||||||||||||||||
options exercised | options vested | |||||||||||||||||||||||
Year ended December 31, 2013 | $ | 111,595 | $ | 1,248,067 | ||||||||||||||||||||
Year ended December 31, 2014 | $ | 260,803 | $ | 821,392 | ||||||||||||||||||||
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Commitments and Contingencies Disclosure [Abstract] | ||||
Future Minimum Rental Payments for Operating Leases | Minimum future payments, as of December 31, 2014, under the aforementioned operating leases for each of the next five years are: | |||
2015 | 995,312 | |||
2016 | 829,005 | |||
2017 | 837,053 | |||
2018 | 845,294 | |||
2019 | 535,720 | |||
Thereafter | 480,163 | |||
$ | 4,522,547 | |||
Financial_Information_About_Se1
Financial Information About Segments (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Segment Reporting [Abstract] | |||||||||
Information About Results of Operations for Each Segment | Information about the results of operations for each segment is set forth in the table below. There were no significant inter-segment sales during the years ended December 31, 2013 and 2014. | ||||||||
During the years ended December 31, 2013 and 2014, 27% and 18%, respectively, of our total sales took place outside the United States. | |||||||||
Years ended December 31, | |||||||||
2013 | 2014 | ||||||||
Technology Development revenue | $ | 11,421,868 | $ | 12,205,889 | |||||
Products and Licensing revenue | 6,911,707 | 9,054,101 | |||||||
Total revenue | 18,333,575 | 21,259,990 | |||||||
Technology Development operating loss | (3,169,605 | ) | (1,964,216 | ) | |||||
Products and Licensing operating income (loss) | (4,865,741 | ) | (2,540,885 | ) | |||||
Total operating loss | (8,035,346 | ) | $ | (4,505,101 | ) | ||||
Depreciation, Technology Development | $ | 499,439 | $ | 317,925 | |||||
Depreciation, Products and Licensing | 266,327 | 235,831 | |||||||
Amortization, Technology Development | 212,790 | 219,156 | |||||||
Amortization, Products and Licensing | 113,471 | 162,565 | |||||||
Segment Information | Additional segment information is as follows: | ||||||||
December 31, | |||||||||
2013 | 2014 | ||||||||
Total segment assets: | |||||||||
Technology Development | $ | 12,275,693 | $ | 15,836,918 | |||||
Products and Licensing | 7,428,382 | 11,747,530 | |||||||
Total | $ | 19,704,075 | $ | 27,584,448 | |||||
Property plant and equipment and intangible assets, Technology Development | $ | 1,463,548 | $ | 2,122,157 | |||||
Property plant and equipment and intangible assets, Products and Licensing | $ | 885,636 | $ | 1,574,177 | |||||
Quarterly_Results_unaudited_Ta
Quarterly Results (unaudited) (Tables) | 12 Months Ended | |||||||||||||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ||||||||||||||||||||||||||||||||
Schedule of Quarterly Financial Information | The following table sets forth our unaudited historical revenues, operating loss and net (loss) income by quarter during 2013 and 2014. | |||||||||||||||||||||||||||||||
Quarter Ended | ||||||||||||||||||||||||||||||||
(Dollars in thousands, | March 31, | June 30, | September 30, | December 31, | March 31, | June 30, | September 30, | December 31, | ||||||||||||||||||||||||
except per share amounts) | 2013 | 2013 | 2013 | 2013 | 2014 | 2014 | 2014 | 2014 | ||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||
Technology | $ | 2,627 | $ | 2,807 | $ | 3,130 | $ | 2,858 | $ | 2,675 | $ | 3,219 | $ | 3,067 | $ | 3,245 | ||||||||||||||||
Products and licensing | 1,478 | 2,024 | 1,569 | 1,841 | 1,796 | 2,009 | 2,304 | 2,945 | ||||||||||||||||||||||||
Total revenues | 4,105 | 4,831 | 4,699 | 4,699 | 4,471 | 5,228 | 5,371 | 6,190 | ||||||||||||||||||||||||
Gross margin | 1,135 | 1,777 | 1,677 | 1,460 | 1,552 | 1,988 | 2,083 | 2,214 | ||||||||||||||||||||||||
Operating loss | (2,241 | ) | (1,739 | ) | (1,302 | ) | (2,753 | ) | (1,952 | ) | (963 | ) | (720 | ) | (870 | ) | ||||||||||||||||
Loss from continuing operations | (1,319 | ) | (1,035 | ) | (775 | ) | (2,379 | ) | (1,133 | ) | (585 | ) | (467 | ) | (1,932 | ) | ||||||||||||||||
Income/(loss) from discontinued operations net of income taxes | 4,105 | 83 | 161 | 356 | 9,673 | (331 | ) | (278 | ) | (329 | ) | |||||||||||||||||||||
Net loss | 2,786 | (952 | ) | (614 | ) | (2,023 | ) | 8,540 | (916 | ) | (745 | ) | (884 | ) | ||||||||||||||||||
Net (loss)/income attributable to common stockholders | $ | 2,762 | $ | (978 | ) | $ | (640 | ) | $ | (2,049 | ) | $ | 8,511 | $ | (943 | ) | $ | (771 | ) | $ | (914 | ) | ||||||||||
Net loss per share from continuing operations: | ||||||||||||||||||||||||||||||||
Basic and diluted | $ | (0.09 | ) | $ | (0.07 | ) | $ | (0.05 | ) | $ | (0.16 | ) | $ | (0.08 | ) | $ | (0.04 | ) | $ | (0.03 | ) | $ | (0.13 | ) | ||||||||
Net income/(loss) per share from discontinued operations: | ||||||||||||||||||||||||||||||||
Basic and diluted | $ | 0.29 | $ | 0.01 | $ | 0.01 | $ | 0.02 | $ | 0.66 | $ | (0.02 | ) | $ | (0.02 | ) | $ | (0.02 | ) | |||||||||||||
Net (loss)/income attributable to common stockholders: | ||||||||||||||||||||||||||||||||
Basic and diluted | $ | 0.2 | $ | (0.07 | ) | $ | (0.04 | ) | $ | (0.14 | ) | $ | 0.58 | $ | (0.06 | ) | $ | (0.05 | ) | $ | (0.06 | ) | ||||||||||
Weighted average shares: | ||||||||||||||||||||||||||||||||
Basic and diluted | 14,011,814 | 14,362,494 | 14,441,707 | 14,488,060 | 14,653,262 | 14,817,084 | 15,016,429 | 15,056,007 | ||||||||||||||||||||||||
Discontinued_Operations_Tables
Discontinued Operations (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Discontinued Operations and Disposal Groups [Abstract] | |||||||||
Components of (Loss) Income from Discontinued Operations | The key components of income/(loss) from discontinued operations were as follows: | ||||||||
Years ended December 31, | |||||||||
2013 | 2014 | ||||||||
Net revenues | $ | 5,909,375 | $ | — | |||||
Cost of revenues | 3,486,200 | 46,204 | |||||||
Operating expenses | 229,745 | — | |||||||
Income/(loss) before income taxes | 2,193,430 | (46,204 | ) | ||||||
Allocated tax expense/(benefit) | 879,819 | (11,713 | ) | ||||||
Operating income/(loss) from discontinued operations | 1,313,611 | (34,491 | ) | ||||||
Gain on sale, net of $1.5 million and $1.3 million of related income taxes | 3,391,639 | 9,381,948 | |||||||
Income from discontinued operations, net of income taxes | $ | 4,705,250 | $ | 9,347,457 | |||||
Organization_and_Summary_of_Si3
Organization and Summary of Significant Accounting Policies - Additional Information (Detail) (USD $) | 12 Months Ended | 1 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | Jan. 31, 2010 | |
Segment | |||
Significant Accounting Policies [Line Items] | |||
Number of operating segments | 2 | ||
Dividend on preferred stock, shares of common stock issuable | 79,292 | 79,292 | |
Allowance for uncollectible receivables | $134,811 | $134,811 | |
Cash Equivalents | 13,900,000 | 7,500,000 | |
Research, development, and engineering | 2,087,874 | 2,558,332 | |
Patents | |||
Significant Accounting Policies [Line Items] | |||
Finite lived intangible asset, useful life | 5 years | ||
Stock Option and Warrant | |||
Significant Accounting Policies [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share amount | 2,300,000 | 2,300,000 | |
Carilion Clinic | |||
Significant Accounting Policies [Line Items] | |||
Senior convertible Promissory Notes principal amount converted | 5,000,000 | ||
Percentage of dividend payable on series A convertible preferred stock | 6.00% | ||
Conversion of stock description | Each share of Series A Convertible Preferred Stock may be converted into one share of our common stock at the option of the holder. | ||
Carilion Clinic | Maximum | |||
Significant Accounting Policies [Line Items] | |||
Preferred stock liquidation preference value | $6,200,000 | ||
Term Loan | |||
Significant Accounting Policies [Line Items] | |||
Debt, additional interest above prime rate | 2.00% |
Organization_and_Summary_of_Si4
Organization and Summary of Significant Accounting Policies - Property and Equipment Estimated Useful Lives (Detail) | 12 Months Ended |
Dec. 31, 2014 | |
Equipment | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property plant and equipment useful life | 3 years |
Equipment | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property plant and equipment useful life | 7 years |
Furniture and Fixtures | |
Property, Plant and Equipment [Line Items] | |
Property plant and equipment useful life | 7 years |
Software | |
Property, Plant and Equipment [Line Items] | |
Property plant and equipment useful life | 3 years |
Leasehold Improvements | |
Property, Plant and Equipment [Line Items] | |
Property plant and equipment useful life | LesserB ofB leaseB termB orB lifeB ofB improvements |
Organization_and_Summary_of_Si5
Organization and Summary of Significant Accounting Policies - Assumptions Used to Estimate Fair Values of Option Granted (Detail) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Risk-free interest rate, minimum | 2.02% | 1.27% |
Risk-free interest rate, maximum | 2.27% | 2.34% |
Expected life of option-years | 7 years 6 months | 7 years 6 months |
Expected stock price volatility | 106.00% | 108.00% |
Executive turnover rates | 0.00% | 0.00% |
Non-executive turnover rates | 33.60% | 14.70% |
Expected dividend yield | 0.00% | 0.00% |
Inventory_Components_of_Invent
Inventory - Components of Inventory (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Inventory Disclosure [Abstract] | ||
Finished goods | $648,182 | $719,574 |
Work-in-process | 262,025 | 361,754 |
Raw materials | 2,692,765 | 2,339,595 |
Inventory, Gross, Total | 3,602,972 | 3,420,923 |
Less: Inventory reserves | 238,739 | 74,746 |
Total inventory, net | $3,364,233 | $3,346,177 |
Debt_Additional_Information_De
Debt - Additional Information (Detail) (USD $) | 12 Months Ended | |||
Dec. 31, 2014 | Dec. 31, 2013 | Jan. 21, 2014 | Mar. 21, 2013 | |
Installment | ||||
Debt Instrument [Line Items] | ||||
Long-term debt obligation | $625,000 | |||
Long-term debt obligation, excluding current maturities | 0 | 625,000 | ||
Current portion of long term debt obligation | 625,000 | 1,500,000 | ||
Term Loan | ||||
Debt Instrument [Line Items] | ||||
Debt, face amount | 6,000,000 | |||
Debt, number of monthly payment | 48 | |||
Debt instrument frequency of payment | monthly | |||
Debt, additional interest above prime rate | 2.00% | |||
Long-term debt obligation | 600,000 | |||
Effective interest rate | 6.00% | |||
Term Loan | Silicon Valley Bank Term Loan | ||||
Debt Instrument [Line Items] | ||||
Long-term debt obligation | 625,000 | 2,125,000 | ||
Revolving Credit Facility | Fourth Loan Modification Agreement | ||||
Debt Instrument [Line Items] | ||||
Maintaining minimum cash balance as per covenant | 3,500,000 | 5,000,000 | ||
Revolving Credit Facility | Silicon Valley Bank Term Loan | Second and Third Amendment | ||||
Debt Instrument [Line Items] | ||||
Debt, additional interest above prime rate | 1.25% | |||
Credit facility, maximum borrowing capacity | 1,000,000 | |||
Unused Line of Credit fee percentage | 0.25% | |||
Termination fee | $10,000 | |||
Credit facility, maturity date | 18-May-14 |
Debt_Summary_of_Debt_Outstandi
Debt - Summary of Debt Outstanding (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Debt Instrument [Line Items] | ||
Long term debt | $625,000 | |
Less: current portion | 625,000 | 1,500,000 |
Long-term debt obligation, excluding current maturities | 0 | 625,000 |
Term Loan | ||
Debt Instrument [Line Items] | ||
Long term debt | 600,000 | |
Silicon Valley Bank Term Loan | Term Loan | ||
Debt Instrument [Line Items] | ||
Long term debt | $625,000 | $2,125,000 |
Debt_Maturities_on_Long_Term_D
Debt - Maturities on Long Term Debt (Detail) (USD $) | Dec. 31, 2014 |
Debt Disclosure [Abstract] | |
2015 | $625,000 |
Total | $625,000 |
Debt_Costs_Associated_With_Loa
Debt - Costs Associated With Loans Outstanding (Detail) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Debt Disclosure [Abstract] | ||
Interest expense | $87,426 | $189,151 |
Amortization of transaction costs | 8,803 | 18,387 |
Total interest expense | $96,229 | $207,538 |
Accounts_ReceivableTrade_Compo
Accounts Receivable-Trade - Components of Accounts Receivable (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Receivables [Abstract] | ||
Billed | $4,517,672 | $3,552,184 |
Unbilled | 1,249,814 | 1,755,439 |
Other | 56,940 | 235,469 |
Accounts Receivable, Gross, Total | 5,824,426 | 5,543,092 |
Less: allowance for doubtful accounts | -134,811 | -134,811 |
Accounts Receivable, Net, Total | $5,689,615 | $5,408,281 |
Property_and_Equipment_Compone
Property and Equipment - Components of Property and Equipment, Net (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Property, Plant and Equipment [Abstract] | ||
Building | $69,556 | $69,556 |
Equipment | 7,312,730 | 7,239,017 |
Furniture and fixtures | 562,485 | 562,485 |
Software | 1,092,484 | 1,092,484 |
Leasehold improvements | 4,830,055 | 3,168,377 |
Property, Plant and Equipment, Gross, Total | 13,867,310 | 12,131,919 |
Lessbaccumulated depreciation | -10,370,253 | -10,071,210 |
Property and equipment, net | $3,497,057 | $2,060,709 |
Property_and_Equipment_Additio
Property and Equipment - Additional Information (Detail) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Property, Plant and Equipment [Abstract] | ||
Depreciation | $0.30 | $0.50 |
Intangible_Assets_Summary_of_I
Intangible Assets - Summary of Intangible Assets (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, net | $199,277 | $288,475 |
Patent costs | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite lived intangible assets gross | 2,356,820 | 2,496,560 |
Accumulated amortization | -2,157,543 | -2,208,085 |
Intangible assets, net | $199,277 | $288,475 |
Intangible_Assets_Additional_I
Intangible Assets - Additional Information (Detail) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization expense | $0.30 | $0.40 |
Intangible_Assets_Estimated_Ag
Intangible Assets - Estimated Aggregate Amortization (Detail) (USD $) | Dec. 31, 2014 |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2015 | $91,285 |
2016 | 53,342 |
2017 | 29,218 |
2018 | 15,137 |
2019 | 2,210 |
Finite-Lived Intangible Assets, Net, Total | $191,192 |
Accrued_Liabilities_Details
Accrued Liabilities (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Accrued Liabilities [Abstract] | ||
Accrued compensation | $2,362,608 | $2,205,612 |
Accrued sub-contracts | 244,218 | 297,510 |
Accrued professional fees | 177,712 | 279,991 |
Accrued income tax | 166,550 | 13,143 |
Deferred rent | 1,752,717 | 102,569 |
Royalties | 392,945 | 291,442 |
Warranty reserve | 69,264 | 56,700 |
Claims reserve | 0 | 92,167 |
Accrued liabilities - other | 370,308 | 207,451 |
Total Accrued Liabilities | $5,536,322 | $3,546,585 |
Income_Taxes_Components_of_Inc
Income Taxes - Components of Income Tax Expense (Detail) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Current: | ||
Federal | ($1,146,447) | ($2,387,422) |
State | 9,219 | 0 |
Deferred Federal | 0 | 0 |
Deferred State | 0 | 0 |
Income tax benefit | ($1,137,228) | ($2,387,422) |
Income_Taxes_Deferred_Tax_Asse
Income Taxes - Deferred Tax Assets and Liabilities (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Deferred Income Tax Assets And Liabilities [Line Items] | ||
Net operating loss carryforwards | $21,200,000 | |
Research and development credits | 400,000 | |
Total, current | 1,734,963 | 924,126 |
Valuation allowance, current | -1,734,963 | -924,126 |
Net deferred tax asset, current | 0 | 0 |
Total, noncurrent | 10,955,486 | 14,094,099 |
Valuation allowance, noncurrent | -10,955,486 | -14,094,099 |
Net deferred tax asset, noncurrent | 0 | 0 |
Deferred Tax Assets Current | ||
Deferred Income Tax Assets And Liabilities [Line Items] | ||
Bad debt and inventory reserve | 150,330 | 88,077 |
Accrued liabilities | 1,584,633 | 836,049 |
Deferred Tax Assets Noncurrent | ||
Deferred Income Tax Assets And Liabilities [Line Items] | ||
Deferred revenue | 126,096 | 59,673 |
Depreciation and amortization | 309,600 | 1,024,746 |
Net operating loss carryforwards | 8,030,396 | 10,897,715 |
Research and development credits | 386,161 | 386,161 |
Deferred compensation | 199,717 | 163,655 |
Stock-based compensation | 1,695,868 | 1,519,513 |
AMT credit | $207,648 | $42,636 |
Income_Taxes_Reconciliation_of
Income Taxes - Reconciliation of Expected Income Tax Benefit (Expense) to Actual Income Tax Expense Benefit (Expense) (Detail) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Income Tax Disclosure [Abstract] | ||
Income tax expense at federal statutory rate | 34.00% | 34.00% |
State taxes, net of federal tax effects | 3.75% | 3.96% |
Change in valuation allowance | -8.02% | -3.78% |
Incentive stock options | -3.33% | -4.12% |
Provision to return adjustments | -0.34% | 2.43% |
Meals and entertainment | -0.27% | -0.13% |
Other Permanent differences | -0.46% | -2.12% |
Income tax benefit | 25.33% | 30.24% |
Income_Taxes_Additional_Inform
Income Taxes - Additional Information (Detail) (USD $) | 12 Months Ended |
Dec. 31, 2014 | |
Income Taxes [Line Items] | |
Net operating loss carryforwards | $21,200,000 |
Expiration dates, through | 2025 |
Research and development credits | 400,000 |
Research & development tax credit carryforwards expiration date | 2024 |
U.S. federal statute of limitations remains open for tear | 2006 and onward |
Income tax examination description | We currently have no federal income tax returns under examination. U.S. state jurisdictions have statutes of limitation generally ranging from three to seven years. We currently have no state income or franchise tax returns under examination. We currently do not file tax returns in any foreign tax jurisdiction. |
Unrecognized tax benefits net increases (decreases) resulting from current period tax positions | 0 |
Windfall stock compensation deductions | $331,000 |
Minimum | |
Income Taxes [Line Items] | |
Income tax examination statute of limitations period (in years) | 3 years |
Maximum | |
Income Taxes [Line Items] | |
Income tax examination statute of limitations period (in years) | 7 years |
Stockholders_Equity_Additional
Stockholders' Equity - Additional Information (Detail) (USD $) | 12 Months Ended | 1 Months Ended | |||||
In Millions, except Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Jan. 31, 2010 | Jan. 31, 2006 | Apr. 30, 2003 | Dec. 31, 2012 | Feb. 04, 2006 |
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | |||||||
Shares issued | 303,000 | 337,500 | |||||
Shares vested | -114,660 | -12,963 | |||||
Options outstanding (in shares) | 4,289,631 | 5,422,130 | |||||
Stock based compensation expense | $0.90 | $1.20 | |||||
Stock-based compensation expense expected to recognize | 1.5 | ||||||
Weighted average remaining service | 1 year 5 months 19 days | ||||||
Carilion Clinic | |||||||
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | |||||||
Senior convertible Promissory Notes principal amount converted | 5 | ||||||
Accrued interest converted | 1.2 | ||||||
Percentage of dividend payable on series A convertible preferred stock | 6.00% | ||||||
Shares of common stock dividends | 393,277 | ||||||
Conversion of stock description | Each share of Series A Convertible Preferred Stock may be converted into one share of our common stock at the option of the holder. | ||||||
Carilion Clinic | Maximum | |||||||
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | |||||||
Preferred stock liquidation preference value | $6.20 | ||||||
Carilion Clinic | Series A Convertible Preferred Stock | |||||||
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | |||||||
Preferred stock issued in exchange of notes payable, shares | 1,321,514 | ||||||
Restricted Stock | |||||||
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | |||||||
Shares issued | 303,000 | 337,500 | |||||
Shares vested | 101,000 | 0 | |||||
Stock Options | |||||||
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | |||||||
Vesting period | 5 years | ||||||
Weighted average grant date fair value of options granted (in dollars per share) | $0.87 | $1.23 | |||||
Stock Options | Carilion Clinic | |||||||
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | |||||||
Conversion of stock, ratio | 1 | ||||||
Stock Options | Hansen | |||||||
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | |||||||
Common stock issued upon exercise of warrant (in shares) | 0 | ||||||
2003 Stock Option Plan | Stock Options | |||||||
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | |||||||
Stock option contractual term | 10 years | 10 years | |||||
Number of shares reserved for future issuance | 9,715,000 | ||||||
Options outstanding (in shares) | 541,394 | ||||||
2006 Equity Incentive Plan | Stock Options | |||||||
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | |||||||
Description of shares available for issuance | the number of shares available for issuance increases by the lesser of (a)B 10% of the outstanding shares of our common stock on the last day of the preceding fiscal year; (b)B 1,695,690 shares; or (c)B such other amount as our Board of Directors may determine. | ||||||
Number of shares available for issuance increases, percentage of outstanding common stock | 10.00% | ||||||
Potential number of shares available for issuance increases | 1,695,690 | ||||||
Shares available for future grant | 13,999,918 | 10,468,175 |
Stockholders_Equity_Activity_o
Stockholders' Equity - Activity of Stock Options (Detail) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Options Outstanding, Number of Shares | ||
Beginning Balance (in shares) | 5,422,130 | |
Forfeited (in shares) | -1,660,354 | -693,644 |
Exercised (in shares) | -321,696 | -137,097 |
Granted (in shares) | 992,452 | 687,840 |
Ending Balance (in shares) | 4,289,631 | |
Options Outstanding, Price per Share Range | ||
Beginning Balance, lower limit (in dollars per share) | $0.35 | $0.35 |
Beginning Balance, upper limit (in dollars per share) | $6.55 | $6.74 |
Forfeited, lower limit (in dollars per share) | $0.35 | $0.35 |
Forfeited, upper limit (in dollars per share) | $6.55 | $6.74 |
Exercised, lower limit (in dollars per share) | $0.35 | $0.35 |
Exercised, upper limit (in dollars per share) | $1.27 | $1.18 |
Granted, lower limit (in dollars per share) | $1.37 | $1.20 |
Granted, upper limit (in dollars per share) | $1.53 | $1.31 |
Ending Balance, lower limit (in dollars per share) | $0.35 | $0.35 |
Ending Balance, upper limit (in dollars per share) | $6.55 | $6.55 |
Options Outstanding, Weighted Average Exercise Price | ||
Beginning balance (in dollars per share) | $2.19 | |
Forfeited (in dollars per share) | $2.22 | $2.08 |
Exercised (in dollars per share) | $0.73 | $0.56 |
Granted (in dollars per share) | $1.43 | $1.29 |
Ending balance (in dollars per share) | $1.93 | |
Options Outstanding, Aggregate Intrinsic Value beginning balance (in shares) | $784,154 | $639,904 |
Options Outstanding, Aggregate Intrinsic Value ending balance (in shares) | 512,901 | 784,154 |
Options Exercisable, beginning balance (in shares) | 3,775,388 | |
Options Exercisable, ending balance (in shares) | 3,111,199 | |
Options Exercisable, Weighted Average Exercise Price, beginning balance (in dollars per share) | $2.37 | |
Options Exercisable, Weighted Average Exercise Price, ending balance (in dollars per share) | $2.11 | |
Options Exercisable, Aggregate Intrinsic Value, beginning balance | 697,826 | 604,292 |
Options Exercisable, Aggregate Intrinsic Value, ending balance | $453,032 | $697,826 |
Stockholders_Equity_Activity_o1
Stockholders' Equity - Activity of Stock Option by Exercise Price Range (Detail) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||
Options Outstanding (in shares) | 4,289,631 | 5,422,130 | |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $1.93 | $2.19 | |
Options Exercisable (in shares) | 3,111,199 | 3,775,388 | |
Weighted Average Exercise Price of Options Exercisable (in dollars per share) | $2.11 | $2.37 | |
Total intrinsic value of options exercised | $260,803 | $111,595 | |
Total fair value of options vested | $821,392 | $1,248,067 | |
$0.35 - 6.55 | |||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |||
Range of Exercise Prices, lower range (in dollars per share) | $0.35 | $0.35 | |
Range of Exercise Prices, upper range (in dollars per share) | $6.55 | $6.55 | |
Options Outstanding (in shares) | 4,289,631 | 5,279,229 | |
Options Outstanding, Weighted Average Remaining Life in Years | 6 years 0 months 10 days | 5 years 10 months 17 days | |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $1.93 | $2.11 | |
Options Exercisable (in shares) | 3,111,199 | 4,012,378 | |
Weighted Average Exercise Price of Options Exercisable (in dollars per share) | $2.11 | $2.28 |
Stockholders_Equity_Activity_o2
Stockholders' Equity - Activity of Restricted Stock (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Number of Vested Shares | ||
Beginning balance (in shares) | 36,728 | 23,765 |
Granted (in shares) | 0 | 0 |
Vested (in shares) | 114,660 | 12,963 |
Exercised (in shares) | 22,725 | 0 |
Ending balance (in shares) | 128,663 | 36,728 |
Number of Unvested Shares | ||
Beginning balance (in shares) | 339,660 | 15,123 |
Granted (in shares) | 303,000 | 337,500 |
Vested (in shares) | 114,660 | 12,963 |
Exercised (in shares) | 0 | 0 |
Ending balance (in shares) | 528,000 | 339,660 |
Weighted Average Grant Date Fair Value | ||
Beginning balance (in dollars per share) | $1.32 | $1.80 |
Granted (in dollars per share) | $1.40 | $1.26 |
Vested (in dollars per share) | $1.27 | $1.80 |
Exercised (in dollars per share) | $1.26 | $0 |
Ending balance (in dollars per share) | $1.36 | $1.32 |
Aggregate Value of Vested Shares | ||
Beginning balance | $66,110 | $42,777 |
Granted | 0 | 0 |
Vested | 145,639 | 23,333 |
Exercised | 28,634 | 0 |
Ending balance | 183,115 | 66,110 |
Aggregate Value of Unvested Shares | ||
Beginning balance | 429,139 | 27,222 |
Granted | 424,200 | 425,250 |
Vested | 145,639 | 23,333 |
Exercised | 0 | 0 |
Ending balance | $707,700 | $429,139 |
Commitment_and_Contingencies_A
Commitment and Contingencies - Additional Information (Detail) (USD $) | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | |
purchase_order | ||||
Commitments and Contingencies Disclosure [Line Items] | ||||
Sublease income | $108,000 | |||
Operating leases, expiration period (in years) | 2 years | |||
Number of non-cancelable purchase orders executed | 2 | |||
Non-cancelable purchase order commitment | 1,400,000 | 1,400,000 | ||
Non-cancelable purchase order delivery period (in months) | 18 months | |||
Non-cancelable purchase order commitment remained | 500,000 | 500,000 | ||
Minimum Royalty Payable | 1,500,000 | 1,500,000 | ||
Selling, General and Administrative Expenses | ||||
Commitments and Contingencies Disclosure [Line Items] | ||||
Lease and rental expense | $900,000 | $1,000,000 |
Commitment_and_Contingencies_F
Commitment and Contingencies - Future Minimum Rental Payments for Operating Leases (Detail) (USD $) | Dec. 31, 2014 |
Commitments and Contingencies Disclosure [Abstract] | |
2015 | $995,312 |
2016 | 829,005 |
2017 | 837,053 |
2018 | 845,294 |
2019 | 535,720 |
Thereafter | 480,163 |
Operating Leases, Future Minimum Payments Due, Total | $4,522,547 |
Employee_Profit_Sharing_Plan_A
Employee Profit Sharing Plan - Additional Information (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Compensation and Retirement Disclosure [Abstract] | ||
Defined contribution plan eligibility service period (in months) | 3 months | |
Percentage of employer's matching contributions to a defined contribution plan that vests | 25.00% | |
Percentage of employees' gross pay for which employer contributes a matching contribution | 10.00% | |
Contribution to employee compensation plan by employer | $150 | $175 |
Litigation_and_Other_Contingen1
Litigation and Other Contingencies Litigation and Other Contingencies (Details) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 |
complaint | ||
Loss Contingencies [Line Items] | ||
Number of putative class action complaints filed | 3 | |
Government | Unfavorable Regulatory Action | ||
Loss Contingencies [Line Items] | ||
Loss contingency estimate of possible loss | $0.80 |
Recovered_Sheet1
Relationship With Major Customers - Additional Information (Detail) (United States Government) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Consolidated Revenues | ||
Concentration Risk [Line Items] | ||
Concentration percentage | 57.00% | 65.00% |
Billed Trade Receivables | ||
Concentration Risk [Line Items] | ||
Concentration percentage | 29.00% | 25.00% |
Financial_Information_About_Se2
Financial Information About Segments - Additional Information (Detail) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Segment | ||
Segment Reporting [Abstract] | ||
Number of operating segments | 2 | |
Percent of total sales from outside of United States | 18.00% | 27.00% |
Financial_Information_About_Se3
Financial Information About Segments - Information About Results of Operations for Each Segment (Detail) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | |
Segment Reporting Information [Line Items] | ||||||||||
Technology Development revenue | $3,245,000 | $3,067,000 | $3,219,000 | $2,675,000 | $2,858,000 | $3,130,000 | $2,807,000 | $2,627,000 | $12,205,889 | $11,421,868 |
Products and Licensing revenue | 2,945,000 | 2,304,000 | 2,009,000 | 1,796,000 | 1,841,000 | 1,569,000 | 2,024,000 | 1,478,000 | 9,054,101 | 6,911,707 |
Total revenues | 6,190,000 | 5,371,000 | 5,228,000 | 4,471,000 | 4,699,000 | 4,699,000 | 4,831,000 | 4,105,000 | 21,259,990 | 18,333,575 |
Operating income (loss) | -870,000 | -720,000 | -963,000 | -1,952,000 | -2,753,000 | -1,302,000 | -1,739,000 | -2,241,000 | -4,505,101 | -8,035,346 |
Depreciation | 300,000 | 500,000 | ||||||||
Amortization | 300,000 | 400,000 | ||||||||
Technology Development | ||||||||||
Segment Reporting Information [Line Items] | ||||||||||
Operating income (loss) | -1,964,216 | -3,169,605 | ||||||||
Depreciation | 317,925 | 499,439 | ||||||||
Amortization | 219,156 | 212,790 | ||||||||
Products and Licensing | ||||||||||
Segment Reporting Information [Line Items] | ||||||||||
Operating income (loss) | -2,540,885 | -4,865,741 | ||||||||
Depreciation | 235,831 | 266,327 | ||||||||
Amortization | $162,565 | $113,471 |
Financial_Information_About_Se4
Financial Information About Segments - Segment Information (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Assets | $27,584,448 | $19,704,075 |
Property plant and equipment, and intangible assets | 3,497,057 | 2,060,709 |
Technology Development | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Assets | 15,836,918 | 12,275,693 |
Property plant and equipment, and intangible assets | 2,122,157 | 1,463,548 |
Products and Licensing | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Assets | 11,747,530 | 7,428,382 |
Property plant and equipment, and intangible assets | $1,574,177 | $885,636 |
Quarterly_Results_unaudited_Sc
Quarterly Results (unaudited) - Schedule of Quarterly Financial Information (Detail) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | |
Revenues: | ||||||||||
Technology | $3,245,000 | $3,067,000 | $3,219,000 | $2,675,000 | $2,858,000 | $3,130,000 | $2,807,000 | $2,627,000 | $12,205,889 | $11,421,868 |
Products and licensing | 2,945,000 | 2,304,000 | 2,009,000 | 1,796,000 | 1,841,000 | 1,569,000 | 2,024,000 | 1,478,000 | 9,054,101 | 6,911,707 |
Total revenues | 6,190,000 | 5,371,000 | 5,228,000 | 4,471,000 | 4,699,000 | 4,699,000 | 4,831,000 | 4,105,000 | 21,259,990 | 18,333,575 |
Gross margin | 2,214,000 | 2,083,000 | 1,988,000 | 1,552,000 | 1,460,000 | 1,677,000 | 1,777,000 | 1,135,000 | 7,836,620 | 6,048,622 |
Operating loss | -870,000 | -720,000 | -963,000 | -1,952,000 | -2,753,000 | -1,302,000 | -1,739,000 | -2,241,000 | -4,505,101 | -8,035,346 |
Loss from continuing operations | -1,932,000 | -467,000 | -585,000 | -1,133,000 | -2,379,000 | -775,000 | -1,035,000 | -1,319,000 | -3,352,650 | -5,508,400 |
Income/(loss) from discontinued operations net of income taxes | -329,000 | -278,000 | -331,000 | 9,673,000 | 356,000 | 161,000 | 83,000 | 4,105,000 | 9,347,457 | 4,705,250 |
Net (loss)/income | -884,000 | -745,000 | -916,000 | 8,540,000 | -2,023,000 | -614,000 | -952,000 | 2,786,000 | 5,994,807 | -803,150 |
Net (loss)/income attributable to common stockholders | ($914,000) | ($771,000) | ($943,000) | $8,511,000 | ($2,049,000) | ($640,000) | ($978,000) | $2,762,000 | $5,882,610 | ($905,477) |
Net loss per share from continuing operations: | ||||||||||
Basic and diluted (in dollars per share) | ($0.13) | ($0.03) | ($0.04) | ($0.08) | ($0.16) | ($0.05) | ($0.07) | ($0.09) | ($0.23) | ($0.38) |
Net income/(loss) per share from discontinued operations: | ||||||||||
Basic and diluted (in dollars per share) | ($0.02) | ($0.02) | ($0.02) | $0.66 | $0.02 | $0.01 | $0.01 | $0.29 | $0.63 | $0.33 |
Net (loss)/income attributable to common stockholders: | ||||||||||
Basic and diluted (in dollars per share) | ($0.06) | ($0.05) | ($0.06) | $0.58 | ($0.14) | ($0.04) | ($0.07) | $0.20 | $0.40 | ($0.06) |
Weighted average shares: | ||||||||||
Basic and diluted (in shares) | 15,056,007 | 15,016,429 | 14,817,084 | 14,653,262 | 14,488,060 | 14,441,707 | 14,362,494 | 14,011,814 | 14,880,697 | 14,336,135 |
Discontinued_Operations_Additi
Discontinued Operations - Additional Information (Details) (USD $) | 3 Months Ended | 12 Months Ended | 0 Months Ended | 1 Months Ended | |||||||||||
Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | Mar. 01, 2013 | Dec. 31, 2013 | Feb. 28, 2013 | Jan. 21, 2014 | |
Employee | |||||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||||||
Consideration received | $10,927,268 | $5,110,855 | |||||||||||||
Gain on sale, net of income taxes | -329,000 | -278,000 | -331,000 | 9,673,000 | 356,000 | 161,000 | 83,000 | 4,105,000 | 9,347,457 | 4,705,250 | |||||
Net revenues | 0 | 5,909,375 | |||||||||||||
Secure Computing and Communications Group (SCC) | |||||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||||||
Sale price | 6,100,000 | ||||||||||||||
Consideration received | 110,000 | 5,400,000 | |||||||||||||
Additional purchase price received from escrow | 475,000 | ||||||||||||||
Escrow deposits related to SCC group sales | 125,000 | ||||||||||||||
Escrow release period | 18 months | ||||||||||||||
Transaction costs incurred related to SCC sales | 900,000 | ||||||||||||||
Sublease income | 400,000 | ||||||||||||||
Employee of SCC group transferred to purchaser | 20 | ||||||||||||||
Current assets related to disposal group | 200,000 | ||||||||||||||
Long-term assets related to disposal group | 100,000 | ||||||||||||||
Gain on sale, net of income taxes | 9,347,457 | ||||||||||||||
Net income per share from discontinued operations, diluted (in dollars per share) | $0.63 | ||||||||||||||
Net revenues | 1,700,000 | ||||||||||||||
Fiber Optic Shape Sensing and Localization | |||||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||||||
Sale price | 30,000,000 | ||||||||||||||
Employee of SCC group transferred to purchaser | 10 | ||||||||||||||
Current assets related to disposal group | 200,000 | ||||||||||||||
Long-term assets related to disposal group | 200,000 | ||||||||||||||
Cash consideration received at closing | 6,000,000 | ||||||||||||||
Cash consideration to be received within 90 days of closing | 6,000,000 | ||||||||||||||
Potential cash consideration received upon achievement of technical specification | $18,000,000 | ||||||||||||||
Sales | Fiber Optic Shape Sensing and Localization | |||||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||||||
SCC group accounted percentage of revenue to total revenue | 12.00% | ||||||||||||||
Cost of Revenues | Fiber Optic Shape Sensing and Localization | |||||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||||||
SCC group accounted percentage of revenue to total revenue | 9.00% |
Discontinued_Operations_Compon
Discontinued Operations - Components of (Loss) Income from Discontinued Operations (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | |
Discontinued Operations and Disposal Groups [Abstract] | ||||||||||
Net revenues | $0 | $5,909,375 | ||||||||
Cost of revenues | 46,204 | 3,486,200 | ||||||||
Operating expenses | 0 | 229,745 | ||||||||
Income/(loss) before income taxes | -46,204 | 2,193,430 | ||||||||
Allocated tax expense/(benefit) | -11,713 | 879,819 | ||||||||
Operating income/(loss) from discontinued operations | -34,491 | 1,313,611 | ||||||||
Gain on sale, net of $1.5 million and $1.3 million of related income taxes | 9,381,948 | 3,391,639 | ||||||||
Income from discontinued operations, net of income taxes | -329,000 | -278,000 | -331,000 | 9,673,000 | 356,000 | 161,000 | 83,000 | 4,105,000 | 9,347,457 | 4,705,250 |
Gain on sale, related income taxes | $1,300,000 | $1,500,000 |
Subsequent_Events_Additional_I
Subsequent Events - Additional Information (Detail) (Subsequent Event, USD $) | 0 Months Ended | |
Jan. 20, 2015 | Jan. 30, 2015 | |
Subsequent Event [Line Items] | ||
Extension of lease term (in years) | 4 years | |
Leasehold Improvements | ||
Subsequent Event [Line Items] | ||
Change in value | 1,100,000 | |
Alpha Photonix, Inc. | ||
Subsequent Event [Line Items] | ||
Termination fee applicable upon cancellation of agreement | 750,000 | |
Reimbursement expense if merger not approved (up to) | $250,000 | |
Number to be issued per acquiree share | 0.31782 | |
Resulting ownership percentage of combined company by current owners | 56.00% |
Schedule_of_Valuation_and_Qual
Schedule of Valuation and Qualifying Accounts (Detail) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Movement in Valuation Allowances and Reserves [Roll Forward] | ||
Balance at beginning of Period | $209,562 | $86,186 |
Charged to costs and expenses | 166,773 | 134,811 |
Deductions | -2,775 | -11,435 |
Valuation against asset | 0 | 0 |
Balance at end of period | 373,560 | 209,562 |
Inventory obsolescence | ||
Movement in Valuation Allowances and Reserves [Roll Forward] | ||
Balance at beginning of Period | 74,751 | 86,186 |
Charged to costs and expenses | 166,773 | 0 |
Deductions | -2,775 | -11,435 |
Valuation against asset | 0 | 0 |
Balance at end of period | 238,749 | 74,751 |
Allowances for doubtful Accounts | ||
Movement in Valuation Allowances and Reserves [Roll Forward] | ||
Balance at beginning of Period | 134,811 | 0 |
Charged to costs and expenses | 0 | 134,811 |
Deductions | 0 | 0 |
Valuation against asset | 0 | 0 |
Balance at end of period | $134,811 | $134,811 |