Digital Ally (DGLY) 10-Q 14 Aug 19 2019 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2019	Aug. 14, 2019
Document And Entity Information
Entity Registrant Name	DIGITAL ALLY INC
Entity Central Index Key	0001342958
Document Type	10-Q
Document Period End Date	Jun. 30, 2019
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business Flag	true
Entity Emerging Growth Company	false
Entity Ex Transition Period	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		11,613,442
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2019

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($)	Jun. 30, 2019	Dec. 31, 2018
Current assets:
Cash and cash equivalents	$ 331,665	$ 3,598,807
Accounts receivable-trade, less allowance for doubtful accounts of $90,000 - 2019 and $70,000 - 2018	1,612,046	1,847,886
Accounts receivable-other	500,968	382,412
Inventories, net	6,792,049	6,999,060
Income tax refund receivable, current	44,603	44,603
Prepaid expenses	429,268	429,403
Total current assets	9,710,599	13,302,171
Furniture, fixtures and equipment, net	182,975	247,541
Intangible assets, net	444,982	486,797
Operating lease right of use assets	276,338
Income tax refund receivable	45,397	45,397
Other assets	389,749	256,749
Total assets	11,050,040	14,338,655
Current liabilities:
Accounts payable	1,857,620	784,599
Accrued expenses	1,062,234	2,080,667
Current portion of operating lease obligations	357,498
Contract liabilities-current	1,794,457	1,748,789
Income taxes payable	3,933	3,689
Total current liabilities	5,075,742	4,617,744
Long-term liabilities:
Proceeds investment agreement, at fair value- less current portion	6,240,000	9,142,000
Contract liabilities-long term	1,864,989	1,991,091
Total liabilities	13,180,731	15,750,835
Commitments and contingencies
Stockholder's Deficit
Common stock, $0.001 par value; 50,000,000 shares authorized; shares issued: 11,494,055 - 2019 and 10,445,445 - 2018	11,494	10,445
Additional paid in capital	80,990,851	78,117,507
Treasury stock, at cost (63,518 shares)	(2,157,226)	(2,157,226)
Accumulated deficit	(80,975,810)	(77,382,906)
Total stockholders' deficit	(2,130,691)	(1,412,180)
Total liabilities and stockholders' deficit	$ 11,050,040	$ 14,338,655

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($)	Jun. 30, 2019	Dec. 31, 2018
Statement of Financial Position [Abstract]
Allowance for doubtful accounts receivable	$ 90,000	$ 70,000
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	50,000,000	50,000,000
Common stock, shares issued	11,494,055	10,445,445
Treasury stock shares	63,518	63,518

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations (Unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Revenue:
Total revenue	$ 2,546,983	$ 3,563,550	$ 5,097,779	$ 6,035,063
Cost of revenue:
Total cost of revenue	1,596,171	1,945,083	2,965,227	3,307,202
Gross profit	950,812	1,618,467	2,132,552	2,727,861
Selling, general and administrative expenses:
Research and development expense	582,905	333,760	1,045,076	773,880
Selling, advertising and promotional expense	1,237,947	712,008	1,993,936	1,386,413
Stock-based compensation expense	585,195	594,228	1,310,393	1,087,746
General and administrative expense	1,977,123	1,415,780	4,301,663	2,890,447
Patent litigation settlement	(6,000,000)		(6,000,000)
Total selling, general and administrative expenses	(1,616,830)	3,055,776	2,651,068	6,138,486
Operating income (loss)	2,567,642	(1,437,309)	(518,516)	(3,410,625)
Other income (expense)
Interest income	5,628	684	23,612	2,300
Interest expense		(152,975)		(283,203)
Change in warrant derivative liabilities		(310,195)		(309,306)
Secured convertible debentures issuance expense		(220,312)		(220,312)
Loss on the extinguishment of secured convertible debentures				(500,000)
Change in fair value of proceeds investment agreement	(2,961,000)		(3,098,000)
Change in fair value of secured convertible debentures		(842,783)		(829,976)
Loss before income tax benefit	(387,730)	(2,962,890)	(3,592,904)	(5,551,122)
Income tax benefit
Net loss	$ (387,730)	$ (2,962,890)	$ (3,592,904)	$ (5,551,122)
Net loss per share information:
Basic	$ (0.03)	$ (0.42)	$ (0.32)	$ (0.78)
Diluted	$ (0.03)	$ (0.42)	$ (0.32)	$ (0.78)
Weighted average shares outstanding:
Basic	11,305,248	7,129,260	11,124,222	7,153,219
Diluted	11,305,248	7,129,260	11,124,222	7,153,219
Product [Member]
Revenue:
Total revenue	$ 1,945,724	$ 2,993,700	$ 3,866,188	$ 4,984,813
Cost of revenue:
Total cost of revenue	1,468,828	1,831,615	2,731,899	3,080,360
Service and Other [Member ]
Revenue:
Total revenue	601,259	569,850	1,231,591	1,050,250
Cost of revenue:
Total cost of revenue	$ 127,343	$ 113,468	$ 233,328	$ 226,842

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Stockholders' Equity (Deficit) (Unaudited) - USD ($)	Common Stock [Member]	Additional Paid in Capital [Member]	Treasury Stock [Member]	Accumulated Deficit [Member]	Total
Balance at Dec. 31, 2017	$ 7,038	$ 64,923,735	$ (2,157,226)	$ (61,909,799)	$ 863,748
Balance, shares at Dec. 31, 2017	7,037,799
Stock-based compensation		493,519			493,519
Restricted common stock grant	$ 84	(84)
Restricted common stock grant, shares	84,500
Restricted common stock forfeitures	$ (26)	26
Restricted common stock forfeitures, shares	(26,450)
Cumulative effects of adjustment for adoption of ASC 606				71,444	71,444
Issuance of common stock purchase warrants in connection with the issuance of subordinated notes payable		47,657			47,657
Net loss				(2,588,232)	(2,588,232)
Balance at Mar. 31, 2018	$ 7,096	65,464,853	(2,157,226)	(64,426,587)	(1,111,864)
Balance, shares at Mar. 31, 2018	7,095,849
Balance at Dec. 31, 2017	$ 7,038	64,923,735	(2,157,226)	(61,909,799)	863,748
Balance, shares at Dec. 31, 2017	7,037,799
Net loss					(5,551,122)
Balance at Jun. 30, 2018	$ 7,286	67,977,829	(2,157,226)	(67,389,477)	(1,561,588)
Balance, shares at Jun. 30, 2018	7,286,175
Balance at Dec. 31, 2017	$ 7,038	64,923,735	(2,157,226)	(61,909,799)	863,748
Balance, shares at Dec. 31, 2017	7,037,799
Net loss					15,500,000
Balance at Dec. 31, 2018	$ 10,445	78,117,507	(2,157,226)	(77,382,906)	(1,412,180)
Balance, shares at Dec. 31, 2018	10,445,445
Balance at Mar. 31, 2018	$ 7,096	65,464,853	(2,157,226)	(64,426,587)	(1,111,864)
Balance, shares at Mar. 31, 2018	7,095,849
Stock-based compensation		594,227			594,227
Restricted common stock grant	$ 100	(100)
Restricted common stock grant, shares	100,000
Restricted common stock forfeitures	$ (4)	4
Restricted common stock forfeitures, shares	(3,950)
Issuance of common stock upon exercise of common stock purchase warrants	$ 20	48,980			49,000
Issuance of common stock upon exercise of common stock purchase warrants, shares	20,000
Issuance of common stock purchase warrants in connection with the issuance of secured convertible debentures		1,684,251			1,684,251
Issuance of common stock upon conversion of secured convertible debentures and accrued interest	$ 74	185,614			185,688
Issuance of common stock upon conversion of secured convertible debentures and accrued interest, shares	74,276
Net loss				(2,962,890)	(2,962,890)
Balance at Jun. 30, 2018	$ 7,286	67,977,829	(2,157,226)	(67,389,477)	(1,561,588)
Balance, shares at Jun. 30, 2018	7,286,175
Balance at Dec. 31, 2018	$ 10,445	78,117,507	(2,157,226)	(77,382,906)	(1,412,180)
Balance, shares at Dec. 31, 2018	10,445,445
Stock-based compensation		725,198			725,198
Restricted common stock grant	$ 522	(522)
Restricted common stock grant, shares	522,110
Restricted common stock forfeitures	$ (2)	2
Restricted common stock forfeitures, shares	(2,500)
Issuance of common stock upon exercise of common stock purchase warrants	$ 161	515,839
Issuance of common stock upon exercise of common stock purchase warrants, shares	161,000
Net loss				(3,205,174)	(3,205,174)
Balance at Mar. 31, 2019	$ 11,126	79,358,024	(2,157,226)	(80,588,080)	(3,376,156)
Balance, shares at Mar. 31, 2019	11,126,055
Balance at Dec. 31, 2018	$ 10,445	78,117,507	(2,157,226)	(77,382,906)	(1,412,180)
Balance, shares at Dec. 31, 2018	10,445,445
Net loss					(3,592,904)
Balance at Jun. 30, 2019	$ 11,494	80,990,851	(2,157,226)	(80,975,810)	(2,130,691)
Balance, shares at Jun. 30, 2019	11,494,055
Balance at Mar. 31, 2019	$ 11,126	79,358,024	(2,157,226)	(80,588,080)	(3,376,156)
Balance, shares at Mar. 31, 2019	11,126,055
Stock-based compensation		585,195			585,195
Issuance of common stock upon exercise of common stock purchase warrants	$ 368	1,047,632			1,048,000
Issuance of common stock upon exercise of common stock purchase warrants, shares	368,000
Net loss				(387,730)	(387,730)
Balance at Jun. 30, 2019	$ 11,494	$ 80,990,851	$ (2,157,226)	$ (80,975,810)	$ (2,130,691)
Balance, shares at Jun. 30, 2019	11,494,055

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)	3 Months Ended				6 Months Ended		12 Months Ended
	Jun. 30, 2019	Mar. 31, 2019	Jun. 30, 2018	Mar. 31, 2018	Jun. 30, 2019	Jun. 30, 2018	Dec. 31, 2018
Cash Flows from Operating Activities:
Net loss	$ (387,730)	$ (3,205,174)	$ (2,962,890)	$ (2,588,232)	$ (3,592,904)	$ (5,551,122)	$ 15,500,000
Adjustments to reconcile net loss to net cash flows used in operating activities:
Depreciation and amortization					206,969	275,392
Change in fair value of warrant derivative liabilities			310,195			309,306
Loss on extinguishment of secured convertible debentures						500,000
Secured convertible debentures issuance expense			220,312			220,312
Change in fair value of secured convertible note payable						829,976
Change in fair value of proceeds investment agreement	2,961,000				3,098,000
Interest expense added to debenture						121,271
Amortization of discount on subordinated note payable						47,657
Stock based compensation	585,195		594,228		1,310,393	1,087,746
Provision for inventory obsolescence					371,494	(437,538)
Provision for doubtful accounts receivable					20,000
(Increase) decrease in:
Accounts receivable - trade					215,840	(79,575)
Accounts receivable - other					(118,556)	(118,461)
Operating lease right of use asset					224,413
Inventories					(164,483)	1,343,445
Prepaid expenses					135	90,640
Other assets					(133,000)	(54,944)
Increase (decrease) in:
Accounts payable					1,073,021	(168,117)
Accrued expenses					(1,018,433)	(132,429)
Lease obligation with right of use asset					(143,252)
Income taxes payable					244	(6,385)
Contract liabilities					(80,434)	200,759
Net cash provided by (used in) operating activities					1,269,447	(1,522,067)
Cash Flows from Investing Activities:
Purchases of furniture, fixtures and equipment					(73,705)	(28,846)
Additions to intangible assets					(26,884)	(55,055)
Release of cash in accordance with secured convertible note						500,000
Net cash provided by (used in) investing activities					(100,589)	416,099
Cash Flows from Financing Activities:
Proceeds from subordinated notes payable						250,000
Proceeds from exercise of warrants					1,564,000
Proceeds from secured convertible debentures and detachable common stock purchase warrants						6,250,000
Principal payment on secured convertible debentures						(3,250,000)
Principal payment on subordinated notes payable						(1,008,500)
Principal payment on proceeds investment agreement					(6,000,000)
Proceeds from issuance of common stock and warrants						10,400
Loss on extinguishment of secured convertible debentures						500,000
Secured convertible debentures issuance expense						(220,312)
Principal payments on capital lease obligation						(8,492)
Net cash provided by (used in) financing activities					(4,436,000)	1,523,096
Net increase (decrease) in cash and cash equivalents					(3,267,142)	417,128
Cash and cash equivalents, beginning of period		$ 3,598,807		$ 54,712	3,598,807	54,712	54,712
Cash and cash equivalents, end of period	$ 331,655		$ 471,840		331,655	471,840	$ 3,598,807
Supplemental disclosures of cash flow information:
Cash payments for interest						172,283
Cash payments for income taxes					5,756	6,385
Supplemental disclosures of non-cash investing and financing activities:
Restricted common stock grant					522	184
Restricted common stock forfeitures					2	30
Obtaining right of use asset for lease liability					500,751
Amounts allocated to common stock purchase warrants in connection with proceeds from secured convertible debentures						1,684,251
Issuance of common stock upon conversion of secured convertible debentures and payment of accrued interest						185,688
Issuance of common stock upon exercise of common stock purchase warrants accounted for as warrant liabilities						38,600
Amounts allocated to common stock purchase warrants in connection with proceeds from subordinated notes payable						$ 47,657

Nature of Business and Summary

Nature of Business and Summary of Significant Accounting Policies	6 Months Ended
	Jun. 30, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Nature of Business and Summary of Significant Accounting Policies	NOTE 1. NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of Business: Digital Ally, Inc. and subsidiary (collectively, “Digital Ally,” “Digital,” the “Company”) produces digital video imaging and storage products for use in law enforcement, security and commercial applications. Its products are an in-car digital video/audio recorder contained in a rear-view mirror for use in law enforcement and commercial fleets; a system that provides its law enforcement customers with audio/video surveillance from multiple vantage points and hands-free automatic activation of body-worn cameras and in-car video systems; a miniature digital video system designed to be worn on an individual’s body; and cloud storage solutions. The Company has active research and development programs to adapt its technologies to other applications. It can integrate electronic, radio, computer, mechanical, and multi-media technologies to create unique solutions to address needs in a variety of other industries and markets, including mass transit, school bus, taxicab and the military. The Company sells its products to law enforcement agencies and other security organizations and consumer and commercial fleet operators through direct sales domestically and third-party distributors internationally. The Company was originally incorporated in Nevada on December 13, 2000 as Vegas Petra, Inc. and had no operations until 2004. On November 30, 2004, Vegas Petra, Inc. entered into a Plan of Merger with Digital Ally, Inc., at which time the merged entity was renamed Digital Ally, Inc. Recently Adopted Pronouncements In February 2016, the FASB issued Accounting Standard Update (“ASU”) 2016-02, Leases The Company adopted the new guidance on January 1, 2019 using the optional transitional method and elected to use the package of three practical expedients which allows the Company not to reassess whether contracts are or contain leases, lease classification and whether initial direct costs qualify for capitalization. The Company has completed its assessment of the impact of the standard and determined that the only lease that the Company held was an operating lease for its office and warehouse space. Upon adoption of the standard, the Company recorded Right of Use (ROU) assets of approximately $501,000 and lease liabilities of approximately $582,000 related to it office and warehouse space operating leases. The Company also removed deferred rent of approximately $81,000 when adopting the new guidance. Management’s Liquidity Plan The Company incurred operating losses in the six months ended June 30, 2019 and substantial operating losses for the year ended December 31, 2018 primarily due to reduced revenues and gross margins caused by competitors’ willful infringement of its patents, specifically the auto-activation of body-worn and in-car video systems, and by competitors’ introduction of newer products with more advanced features together with significant price cutting of their products. The Company incurred net losses of approximately $3.6 million for the six months ended June 30, 2019 and $15.5 million during the year ended December 31, 2018 and it had an accumulated deficit of $81.0 million as of June 30, 2019. During the six months ended June 30, 2019, the Company settled one of its patent infringement cases and received a lump sum payment of $6.0 million which was used to pay its obligations under its Proceeds Investment Agreement (the “PIA”), as more fully described in Note 11. In recent years the Company has accessed the public and private capital markets to raise funding through the issuance of debt and equity. In that regard, the Company raised $1,564,000 in the six months ended June 30, 2019 from the exercise of warrants. Additionally, the Company raised funding in the form of subordinated debt, secured debt and proceeds investment agreements totaling $16,500,000, and net proceeds of $7,324,900 from an underwritten public offering of common stock during the year ended December 31, 2018. The Company issued common stock with detachable common stock purchase warrants for $2,776,332 and raised funding from subordinated and secured debt totaling $1,608,500 during the year ended December 31, 2017. During 2016, the Company raised $4.0 million of funding in the form of convertible debentures and common stock purchase warrants. These debt and equity raises were utilized to fund its operations and management expects to continue this pattern until it achieves positive cash flows from operations, although it can offer no assurance in this regard. The Company retired all interest-bearing debt outstanding during the year ended December 31, 2018. The only long-term obligations outstanding as of June 30, 2019 are associated with the PIA that the Company entered into during July 2018, as more fully described in Note 6. On August 5, 2019, the Company raised funds from the issuance of $2.78 million principal balance of convertible debentures with detachable warrants to purchase 571,248 shares of common stock with the net proceeds being used for working capital purposes, as more fully described in Note 15. The Company settled its lawsuit with the PGA Tour and the case was dismissed by the Plaintiff with prejudice on April 17, 2019. See Note 11, “Contingencies” for the details respecting the settlement. Additionally, the Company settled its lawsuit with WatchGuard on May 13, 2019 and the case was dismissed. See Note 11, “Contingencies” for the details respecting the settlement. The Company will have to restore positive operating cash flows and profitability over the next year and/or raise additional capital to fund its operational plans, meet its customary payment obligations and otherwise execute its business plan. There can be no assurance that it will be successful in restoring positive cash flows and profitability, or that it can raise additional financing when needed, and obtain it on terms acceptable or favorable to the Company. The Company has implemented an enhanced quality control program to detect and correct product issues before they result in significant rework expenditures affecting its gross margins and has seen progress in that regard. In addition, the Company undertook a number of cost reduction initiatives in 2018, including a reduction of its workforce by approximately 40%, restructuring its direct sales force and cutting other selling, general and administrative costs. The Company has increased its addressable market to non-law enforcement customers and obtained new non-law enforcement contracts in 2018, which contracts include recurring revenue during the period 2019 to 2020. The Company believes that its quality control, headcount reduction and cost cutting initiatives, expansion to non-law enforcement sales channels and new product introduction will eventually restore positive operating cash flows and profitability, although it can offer no assurances in this regard. In addition to the initiatives described above, the Board of Directors continues to conduct its review of a full range of strategic alternatives to best position the Company for the future, including, but not limited to, monetizing its patent portfolio and related patent infringement litigation against Axon Enterprise, Inc. (“Axon,” formerly Taser International, Inc.), the sale of all or certain assets, properties or groups of properties or individual businesses or merger or combination with another company. The result of this review may also include the continued implementation of the Company’s business plan. The August 5, 2019 issuance of $2.78 million principal balance of convertible notes was part of this strategic alternatives review. While such funding addressed the Company’s near-term liquidity needs, it continues to consider strategic alternatives to address longer-term liquidity needs and operational issues. There can be no assurance that any additional transactions or financings will result from this process. Based on the uncertainties described above, the Company believes its business plan does not alleviate the existence of substantial doubt about its ability to continue as a going concern within one year from the date of the issuance of these condensed consolidated interim financial statements. The following is a summary of the Company’s Significant Accounting Policies: Basis of Consolidation: The accompanying financial statements include the consolidated accounts of Digital Ally and its wholly-owned subsidiary, Digital Ally International, Inc. All intercompany balances and transactions have been eliminated during consolidation. The Company formed Digital Ally International, Inc. during August 2009 to facilitate the export sales of its products. Fair Value of Financial Instruments: The carrying amounts of financial instruments, including cash and cash equivalents, accounts receivable and accounts payable approximate fair value because of the short-term nature of these items. The Company accounts for its proceeds investment agreement on a fair value basis. Revenue Recognition: The Company applies the provisions of Accounting Standards Codification (ASC) 606-10, Revenue from Contracts with Customers The Company considers customer purchase orders, which in some cases are governed by master sales agreements, to be the contracts with the customer. In situation where sales are to a distributor, the Company had concluded its contracts are with the distributor as the Company holds a contract bearing enforceable rights and obligations only with the distributor. As part of part of its consideration for the contract, the Company evaluates certain factors including the customers’ ability to pay (or credit risk). For each contract, the Company considers the promise to transfer products, each of which is distinct, to be the identified performance obligations. In determining the transaction price, the Company evaluates whether the price is subject to refund or adjustment to determine the net consideration to which it expects to be entitled. As the Company’s standard payment terms are less than one year, it has elected the practical expedient under ASC 606-10-32-18 to not assess whether a contract has a significant financing component. The Company allocates the transaction price to each distinct product based on its relative standalone selling price. The product price as specified on the purchase order is considered the standalone selling price as it is an observable input which depicts the price as if sold to a similar customer in similar circumstances. Revenue is recognized when control of the product is transferred to the customer (i.e. when the Company’s performance obligations is satisfied), which typically occurs at shipment. Further in determining whether control has been transferred, the Company considers if there is a present right to payment and legal title, along with risks and rewards of ownership having transferred to the customer. Customers do not have a right to return the product other than for warranty reasons for which they would only receive repair services or replacement product. The Company has also elected the practical expedient under ASC 340-40-25-4 to expense commissions for product sales when incurred as the amortization period of the commission asset the Company would have otherwise recognized is less than one year. The Company sells its products and services to law enforcement and commercial customers in the following manner: ● Sales to domestic customers are made direct to the end customer (typically a law enforcement agency or a commercial customer) through its sales force, which is composed of its employees. Revenue is recorded when the product is shipped to the end customer. ● Sales to international customers are made through independent distributors who purchase products from the Company at a wholesale price and sell to the end user (typically law enforcement agencies or a commercial customer) at a retail price. The distributor retains the margin as its compensation for its role in the transaction. The distributor generally maintains product inventory, customer receivables and all related risks and rewards of ownership. Accordingly, upon application of steps one through five above, revenue is recorded when the product is shipped to the distributor consistent with the terms of the distribution agreement. ● Repair parts and services for domestic and international customers are generally handled by its inside customer service employees. Revenue is recognized upon shipment of the repair parts and acceptance of the service or materials by the end customer. Sales taxes collected on products sold are excluded from revenues and are reported as accrued expenses in the accompanying balance sheets until payments are remitted. Service and other revenue is comprised of revenues from extended warranties, repair services, cloud revenue and software revenue. Revenue is recognized upon shipment of the product and acceptance of the service or materials by the end customer for repair services. Revenue for extended warranty, cloud service or other software-based products is over the term of the contract warranty or service period. A time-elapsed method is used to measure progress because the Company transfers control evenly over the contractual period. Accordingly, the fixed consideration related to these revenues is generally recognized on a straight-line basis over the contract term, as long as the other revenue recognition criteria have been met. Contracts with some of the Company’s customers contain multiple performance obligations that are distinct and accounted for separately. The transaction price is allocated to the separate performance obligations on a relative standalone selling price (“SSP”). The Company determined SSP for all the performance obligations using observable inputs, such as standalone sales and historical pricing. SSP is consistent with the Company’s overall pricing objectives, taking into consideration the type of service being provided. SSP also reflects the amount the Company would charge for the performance obligation if it were sold separately in a standalone sale. Multiple performance obligations consist of product, software, cloud subscriptions and extended warranties. The Company’s multiple performance obligations may include future in-car or body-worn camera devices to be delivered at defined points within a multi-year contract, and in those arrangements, the Company allocates total arrangement consideration over the life of the multi-year contract to future deliverables using management’s best estimate of selling price. Contract liabilities consist of deferred revenue and include payments received in advance of performance under the contract and are reported separately as current liabilities and non-current liabilities in the Condensed Consolidated Balance Sheets. Such amounts consist of extended warranty contracts, prepaid cloud services and prepaid installation services and are generally recognized as the respective performance obligations are satisfied. Total contract liabilities consist of the following: June 30, 2019 December 31, 2018 Contract liabilities, current $ 1,794,457 $ 1,748,789 Contract liabilities, non-current 1,864,989 1,991,091 Total contract liabilities $ 3,659,446 $ 3,739,880 Sales returns and allowances aggregated $37,978 and $34,227 for the three months ended June 30, 2019 and 2018, respectively, and $112,237 and $54,246 for the six months ended June 30, 2019 and 2018, respectively. Obligations for estimated sales returns and allowances are recognized at the time of sales on an accrual basis. The accrual is determined based upon historical return rates adjusted for known changes in key variables affecting these return rates Revenues for six month ended June 30, 2019 and 2018 were derived from the following sources Six months ended June 30, 2019 2018 DVM-800 $ 1,979,681 $ 2,860,907 DVM-250 Plus 427,343 366,351 FirstVu HD 735,222 642,665 EVO 62,942 — DVM-100 & DVM-400 6,765 64,401 DVM-750 72,549 213,935 VuLink 73,919 133,001 Repair and service 734,332 627,874 Cloud service revenue 349,337 326,741 Other service revenue 94,430 95,635 Laser Ally 19,130 22,530 Accessories and other revenues 542,129 681,023 $ 5,097,779 $ 6,035,063 Use of Estimates: The preparation of the condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates. Cash and cash equivalents: Cash and cash equivalents include funds on hand, in bank and short-term investments with original maturities of ninety (90) days or less. Accounts Receivable: Accounts receivable are carried at original invoice amount less an estimate made for doubtful receivables based on a review of all outstanding amounts on a weekly basis. The Company determines the allowance for doubtful accounts by regularly evaluating individual customer receivables and considering a customer’s financial condition, credit history, and current economic conditions. Trade receivables are written off when deemed uncollectible. Recoveries of trade receivables previously written off are recorded when received. A trade receivable is considered to be past due if any portion of the receivable balance is outstanding for more than thirty (30) days beyond terms. No interest is charged on overdue trade receivables. Inventories: Inventories consist of electronic parts, circuitry boards, camera parts and ancillary parts (collectively, “components”), work-in-process and finished goods, and are carried at the lower of cost (First-in, First-out Method) or market value. The Company determines the estimate for the reserve for slow moving or obsolete inventories by regularly evaluating individual inventory levels, projected sales and current economic conditions. Furniture, fixtures and equipment: Furniture, fixtures and equipment is stated at cost net of accumulated depreciation. Additions and improvements are capitalized while ordinary maintenance and repair expenditures are charged to expense as incurred. Depreciation is recorded by the straight-line method over the estimated useful life of the asset, which ranges from three to ten years. Amortization expense on capitalized leases is included with depreciation expense. Intangible assets: Intangible assets include deferred patent costs and license agreements. Legal expenses incurred in preparation of patent application have been deferred and will be amortized over the useful life of granted patents. Costs incurred in preparation of applications that are not granted will be charged to expense at that time. The Company has entered into several sublicense agreements under which it has been assigned the exclusive rights to certain licensed materials used in its products. These sublicense agreements generally require upfront payments to obtain the exclusive rights to such material. The Company capitalizes the upfront payments as intangible assets and amortizes such costs over their estimated useful life on a straight-line method. Leases: The Company determines if an arrangement contains a lease at inception. For arrangements where the Company is the lessee, the Company will evaluate whether to account for the lease as an operating or finance lease. Operating leases are included in the right of use assets (ROU) and operating lease liabilities on the condensed consolidated balance sheet as of June 30, 2019. Finance leases would be included in furniture, fixtures and equipment, net and long-term debt and finance lease obligations on the condensed balance sheet. The Company had an operating lease for office and warehouse space at June 30, 2019 but no financing leases. ROU assets and lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. The Company uses its incremental borrowing rate based on the information available at the commencement date in determining the operating lease liabilities if the operating lease does not provide an implicit rate. Lease terms may include the option to extend when Company is reasonably certain that the option will be exercised. Lease expense for operating leases is recognized on a straight-line basis over the lease term The Company elected to apply the short-term lease measurement and recognition exemption in which ROU assets and lease liabilities are not recognized for short term leases. Proceeds investment agreement: The Company has elected to record its proceeds investment agreement at its fair value. Accordingly, the proceeds investment agreement will be marked-to-market at each reporting date with the change in fair value reported as a gain (loss) in the Condensed Consolidated Statement of Operations. All issuance costs related to the proceeds investment agreement were expensed as incurred in the Condensed Consolidated Statement of Operations. Long-Lived Assets: Long-lived assets such as furniture, fixtures and equipment and purchased intangible assets subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset or asset group be tested for possible impairment, the Company first compares undiscounted cash flows expected to be generated by that asset or asset group to its carrying value. If the carrying value of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying value exceeds its fair value. Fair value is determined through various valuation techniques, including discounted cash flow models, quoted market values and third-party appraisals, as considered necessary. Warranties: The Company’s products carry explicit product warranties that extend up to two years from the date of shipment. The Company records a provision for estimated warranty costs based upon historical warranty loss experience and periodically adjusts these provisions to reflect actual experience. Accrued warranty costs are included in accrued expenses. Extended warranties are offered on selected products and when a customer purchases an extended warranty the associated proceeds are treated as contract liabilities and recognized over the term of the extended warranty. Shipping and Handling Costs: Shipping and handling costs for outbound sales orders totaled $13,158 and $20,317 for the three months ended June 30, 2019 and 2018, respectively, and $31,578 and $34,284 for the six months ended June 30, 2019 and 2018, respectively. Such costs are included in selling, general and administrative expenses in the Condensed Consolidated Statements of Operations. Advertising Costs: Advertising expense includes costs related to trade shows and conventions, promotional material and supplies, and media costs. Advertising costs are expensed in the period in which they are incurred. The Company incurred total advertising expense of approximately $510,792 and $111,677 for the three months ended June 30, 2019 and 2018, respectively, and $634,807 and $191,246 for the six months ended June 30, 2019 and 2018, respectively. The increase was primarily attributable to our sponsorship of a NASCAR race in May 2019 and other related sponsorship opportunities. Such costs are included in selling, general and administrative expenses in the Condensed Consolidated Statements of Operations. Income Taxes: Deferred taxes are provided for by the liability method in which deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax basis. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The Company applies the provisions of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) No. 740 - Income Taxes that provides a framework for accounting for uncertainty in income taxes and provided a comprehensive model to recognize, measure, present, and disclose in its financial statements uncertain tax positions taken or expected to be taken on a tax return. It initially recognizes tax positions in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions are initially and subsequently measured as the largest amount of tax benefit that is greater than 50% likely of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and all relevant facts. Application requires numerous estimates based on available information. The Company considers many factors when evaluating and estimating its tax positions and tax benefits, and it recognized tax positions and tax benefits may not accurately anticipate actual outcomes. As it obtains additional information, the Company may need to periodically adjust its recognized tax positions and tax benefits. These periodic adjustments may have a material impact on its Condensed consolidated Statements of Operations. The Company’s policy is to record estimated interest and penalties related to the underpayment of income taxes as income tax expense in the condensed consolidated statements of operations. There was no interest expense related to the underpayment of estimated taxes during the six months ended June 30, 2019 and 2018. There were no penalties in the six months ended June 30, 2019 and 2018. The Company is subject to taxation in the United States and various states. As of June 30, 2019, the Company’s tax returns filed for 2015, 2016, and 2017 and to be filed for 2018 are subject to examination by the relevant taxing authorities. With few exceptions, as of June 30, 2019, the Company is no longer subject to Federal, state, or local examinations by tax authorities for years before 2015. Research and Development Expenses: The Company expenses all research and development costs as incurred. Development costs of computer software to be sold, leased, or otherwise marketed are subject to capitalization beginning when a product’s technological feasibility has been established and ending when a product is available for general release to customers. In most instances, the Company’s products are released soon after technological feasibility has been established. Costs incurred subsequent to achievement of technological feasibility were not significant, and software development costs were expensed as incurred during the six months ended June 30, 2019 and 2018. Common Stock Purchase Warrants: The Company has common stock purchase warrants that are accounted for as equity based on their relative fair value and are not subject to re-measurement. Stock-Based Compensation: The Company grants stock-based compensation to its employees, board of directors and certain third-party contractors. Share-based compensation arrangements may include the issuance of options to purchase common stock in the future or the issuance of restricted stock, which generally are subject to vesting requirements. The Company records stock-based compensation expense for all stock-based compensation granted based on the grant-date fair value. The Company recognizes these compensation costs on a straight-line basis over the requisite service period of the award. The Company estimates the grant-date fair value of stock-based compensation using the Black-Scholes valuation model. Assumptions used to estimate compensation expense are determined as follows: ● Expected term is determined using the contractual term and vesting period of the award; ● Expected volatility of award grants made in the Company’s plan is measured using the weighted average of historical daily changes in the market price of the Company’s common stock over the period equal to the expected term of the award; ● Expected dividend rate is determined based on expected dividends to be declared; ● Risk-free interest rate is equivalent to the implied yield on zero-coupon U.S. Treasury bonds with a maturity equal to the expected term of the awards; and ● Forfeitures are accounted for as they occur. Segments of Business: Management has determined that its operations are comprised of one reportable segment: the sale of digital audio and video recording and speed detection devices. For the three and six months ended June 30, 2019 and 2018, sales by geographic area were as follows: Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 Sales by geographic area: United States of America $ 2,477,717 $ 3,386,146 $ 4,992,059 $ 5,824,934 Foreign 69,266 177,404 105,720 210,129 $ 2,546,983 $ 3,563,550 $ 5,097,779 $ 6,035,063 Sales to customers outside of the United States are denominated in U.S. dollars. All Company assets are physically located within the United States. Recent Accounting Pronouncements There were no new material accounting pronouncements that were applicable to the Company for the six months ended June 30, 2019.

Basis of Presentation

Basis of Presentation	6 Months Ended
	Jun. 30, 2019
Accounting Policies [Abstract]
Basis of Presentation	NOTE 2. BASIS OF PRESENTATION The condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles in the United States for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six-month period ended June 30, 2019 are not necessarily indicative of the results that may be expected for the year ending December 31, 2019. The balance sheet at December 31, 2018 has been derived from the audited financial statements at that date but does not include all the information and footnotes required by generally accepted accounting principles in the United States for complete financial statements. For further information, refer to the financial statements and footnotes included in the Company’s annual report on Form 10-K for the year ended December 31, 2018.

Concentration of Credit Risk an

Concentration of Credit Risk and Major Customers	6 Months Ended
	Jun. 30, 2019
Risks and Uncertainties [Abstract]
Concentration of Credit Risk and Major Customers	NOTE 3. CONCENTRATION OF CREDIT RISK AND MAJOR CUSTOMERS Financial instruments that potentially subject the Company to concentrations of credit risk consist of accounts receivable. Sales to domestic customers are typically made on credit and the Company generally does not require collateral while sales to international customers require payment before shipment or backing by an irrevocable letter or credit. The Company performs ongoing credit evaluations of its customers’ financial condition and maintains an allowance for estimated losses. Accounts are written off when deemed uncollectible and accounts receivable are presented net of an allowance for doubtful accounts. The allowance for doubtful accounts totaled $90,000 as of June 30, 2019 and $70,000 as of December 31, 2018. The Company uses primarily a network of unaffiliated distributors for international sales and employee-based direct sales force for domestic sales. No international distributor individually exceeded 10% of total revenues and no customer receivable balance exceeded 10% of total accounts receivable for the six months ended June 30, 2019 and 2018 The Company purchases finished circuit boards and other proprietary component parts from suppliers located in the United States and on a limited basis from Asia. Although the Company obtains certain of these components from single source suppliers, it generally owns all tooling and management has located alternative suppliers to reduce the risk in most cases to supplier problems that could result in significant production delays. The Company has not historically experienced significant supply disruptions from any of its principal vendors and does not anticipate future supply disruptions. The Company acquires most of its components on a purchase order basis and does not have long-term contracts with its suppliers.

Inventories

Inventories	6 Months Ended
	Jun. 30, 2019
Inventory Disclosure [Abstract]
Inventories	NOTE 4. INVENTORIES Inventories consisted of the following at June 30, 2019 and December 31, 2018: June 30, 2019 December 31, 2018 Raw material and component parts $ 4,903,170 $ 4,969,786 Work-in-process 256,910 351,451 Finished goods 5,291,233 4,965,594 Subtotal 10,451,313 10,286,831 Reserve for excess and obsolete inventory (3,659,264 ) (3,287,771 ) Total $ 6,792,049 $ 6,990,060 Finished goods inventory includes units held by potential customers and sales agents for test and evaluation purposes. The cost of such units totaled $141,609 and $115,456 as of June 30, 2019 and December 31, 2018, respectively.

Furniture, Fixtures and Equipme

Furniture, Fixtures and Equipment	6 Months Ended
	Jun. 30, 2019
Property, Plant and Equipment [Abstract]
Furniture, Fixtures and Equipment	NOTE 5. FURNITURE, FIXTURES AND EQUIPMENT Furniture, fixtures and equipment consisted of the following at June 30, 2019 and December 31, 2018: Estimated Useful Life June 30, 2019 December 31, 2018 Office furniture, fixtures and equipment 3-10 years $ 821,453 $ 802,681 Warehouse and production equipment 3-5 years 537,471 526,932 Demonstration and tradeshow equipment 2-5 years 466,394 426,582 Leasehold improvements 2-5 years 163,171 160,198 Rental equipment 1-3 years 126,163 124,553 Total cost 2,114,652 2,040,946 Less: accumulated depreciation and amortization (1,931,677 ) (1,793,405 ) Net furniture, fixtures and equipment $ 182,975 $ 247,541 Depreciation and amortization of furniture, fixtures and equipment aggregated $63,506 and $101,252 for the three months ended June 30, 2019 and 2018, respectively, and $138,272 and $217,802 for the six months ended June 30, 2019 and 2018, respectively.

Debt Obligations

Debt Obligations	6 Months Ended
	Jun. 30, 2019
Debt Disclosure [Abstract]
Debt Obligations	NOTE 6. DEBT OBLIGATIONS Proceeds investment agreement is comprised of the following: June 30, 2019 December 31, 2018 2018 Proceeds Investment Agreement, at fair value $ 6,240,000 $ 9,142,000 Less: Current portion - - 2018 Proceeds investment agreement at fair value-less current portion $ 6,240,000 $ 9,142,000 2018 Proceeds Investment Agreement On July 31, 2018, the Company entered into a Proceeds Investment Agreement (the “PIA”) with Brickell Key Investments LP (“BKI”), pursuant to which BKI funded an aggregate of $500,000 (the “First Tranche”) to be used (i) to fund the Company’s litigation proceedings relating to the infringement of certain patent assets listed in the PIA and (ii) to repay the Company’s existing debt obligations and for certain working capital purposes set forth in the PIA. Pursuant to the PIA, BKI was granted an option to provide the Company with an additional $9.5 million, at BKI’s sole discretion (the “Second Tranche”). On August 21, 2018, BKI exercised its option on the Second Tranche for $9.5 million which completed the $10 million funding. Pursuant to the PIA and in consideration for the $10.0 million in funding, the Company agreed to assign to BKI (i) 100% of all gross, pre-tax monetary recoveries paid by any defendant(s) to the Company or its affiliates agreed to in a settlement or awarded in judgment in connection with the patent assets, plus any interest paid in connection therewith by such defendant(s) (the “Patent Assets Proceeds”), up to the minimum return (as defined in the Agreement) and (ii) if BKI has not received its minimum return by the earlier of a liquidity event (as defined in the Agreement) and July 31, 2020, then the Company agreed to assign to BKI 100% of the Patent Asset Proceeds until BKI has received an amount equal to the minimum return on $4.0 million. Pursuant to the PIA, the Company granted BKI (i) a senior security interest in the Patent Assets, the claims (as defined in the Agreement) and the Patent Assets Proceeds until such time as the minimum return is paid, in which case, the security interest on the patent assets, the claims and the Patent Assets Proceeds will be released, and (ii) a senior security interest in all other assets of the Company until such time as the minimum return is paid on $4.0 million, in which case, the security interest on such other assets will be released. The security interest is enforceable by BKI if the Company is in default under the PIA which would occur if (i) the Company fails, after five (5) days’ written notice, to pay any due amount payable to BKI under the PIA, (ii) the Company fails to comply with any provision of the PIA Agreement or any other agreement or document contemplated under the PIA, (iii) the Company becomes insolvent or insolvency proceedings are commenced (and not subsequently discharged) with respect to the Company, (iv) the Company’s creditors commence actions against the Company (which are not subsequently discharged) that affect material assets of the Company, (v) the Company, without BKI’s consent, incurs indebtedness other than immaterial ordinary course indebtedness up to $500,000, (vi) the Company fails, within five (5) business days following the closing of the second tranche, to fully satisfy its obligations to certain holders of the Company’s senior secured convertible promissory notes listed in the PIA Agreement and fails to obtain unconditional releases from such holders as to the Company’s obligations to such holders and the security interests in the Company held by such holders or (vii) there is an uncured non-compliance of the Company’s obligations or misrepresentations by the Company under the PIA. Under the PIA, the Company issued BKI a warrant to purchase up to 465,712 shares of the Company’s common stock, par value $0.001 per share (the “PIA Warrant”), at an exercise price of $2.60 per share provided that the holder of the PIA Warrant will be prohibited from exercising the PIA Warrant if, as a result of such exercise, such holder, together with its affiliates, would own more than 4.99% of the total number of shares of the Company’s common stock outstanding immediately after giving effect to such exercise. However, such holder may increase or decrease such percentage to any other percentage not in excess of 9.99%, provided that any increase in such percentage shall not be effective until 61 days after such notice to the Company. The PIA Warrant is exercisable for five years from the date of issuance and is exercisable on a cashless exercise basis if there is no effective registration statement. No contractual registration rights were given. The Company elected to account for the PIA on the fair value basis. Therefore, the Company determined the fair value of the PIA and PIA Warrants which yielded estimated fair values of the PIA including their embedded derivatives and the detachable PIA Warrants as follows: Proceeds investment agreement $ 9,067,513 Common stock purchase warrants 932,487 Gross cash proceeds $ 10,000,000 During the six months ended June 30, 2019, the Company settled its patent infringement litigation with WatchGuard and it received a lump-sum payment of $6.0 million as further described in Note 11. In accordance with the terms of the PIA, the Company remitted the $6.0 as a principal payment toward its minimum return payment obligations under the PIA. The Company recorded the receipt of the $6,000,000 settlement as Patent litigation settlement income in the accompanying condensed consolidated statement of operations. The following represents activity in the PIA during the six months ended June 30, 2019: Beginning balance as of January 1, 2019 $ 9,142,000 Repayment of obligation (6,000,000 ) Change in the fair value during the period 3,098,000 Ending balance as of June 30, 2019 $ 6,240,000

Fair Value Measurement

Fair Value Measurement	6 Months Ended
	Jun. 30, 2019
Fair Value Disclosures [Abstract]
Fair Value Measurement	NOTE 7. FAIR VALUE MEASUREMENT In accordance with ASC Topic 820 — Fair Value Measurements and Disclosures ASC 820 utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The following is a brief description of those three levels: ● Level 1 — Quoted prices in active markets for identical assets and liabilities ● Level 2 — Other significant observable inputs (including quoted prices in active markets for similar assets or liabilities) ● Level 3 — Significant unobservable inputs (including the Company’s own assumptions in determining the fair value) The following table represents the Company’s hierarchy for its financial assets and liabilities measured at fair value on a recurring basis as of June 30, 2019 and December 31, 2018. June 30, 2019 Level 1 Level 2 Level 3 Total Liabilities: Proceeds Investment Agreement $ — $ — $ 6,240,000 $ 6,240,000 December 31, 2018 Level 1 Level 2 Level 3 Total Liabilities: Proceeds Investment Agreement $ — $ — $ 9,142,000 $ 9,142,000 The following table represents the change in Level 3 tier value measurements: Proceeds December 31, 2018 $ 9,142,000 Repayment of obligation (6,000,000 ) Change in fair value 3,098,000 June 30, 2019 $ 6,240,000

Accrued Expenses

Accrued Expenses	6 Months Ended
	Jun. 30, 2019
Payables and Accruals [Abstract]
Accrued Expenses	NOTE 8. ACCRUED EXPENSES Accrued expenses consisted of the following at June 30, 2019 and December 31, 2018: June 30, 2019 December 31, 2018 Accrued warranty expense $ 102,955 $ 195,135 Accrued litigation costs 363,508 1,119,445 Accrued sales commissions 26,553 25,750 Accrued payroll and related fringes 265,258 186,456 Accrued insurance 39,112 71,053 Accrued sales returns and allowances 28,714 13,674 Other 236,134 469,154 $ 1,062,234 $ 2,080,667 Accrued warranty expense was comprised of the following for the six months ended June 30, 2019: 2019 Beginning balance $ 195,135 Provision for warranty expense 25,341 Charges applied to warranty reserve (117,521 ) Ending balance $ 102,955

Income Taxes

Income Taxes	6 Months Ended
	Jun. 30, 2019
Income Tax Disclosure [Abstract]
Income Taxes	NOTE 9. INCOME TAXES The effective tax rate for the six months ended June 30, 2019 and 2018 varied from the expected statutory rate due to the Company continuing to provide a 100% valuation allowance on net deferred tax assets. The Company determined that it was appropriate to continue the full valuation allowance on net deferred tax assets as of June 30, 2019 primarily because of the Company’s history of operating losses. The Company has incurred operating losses in recent years and it continues to be in a three-year cumulative loss position at June 30, 2019. Accordingly, the Company determined there was not sufficient positive evidence regarding its potential for future profits to outweigh the negative evidence of our three-year cumulative loss position under the guidance provided in ASC 740. Therefore, it determined to continue to provide a 100% valuation allowance on its net deferred tax assets. The Company expects to continue to maintain a full valuation allowance until it determines that it can sustain a level of profitability that demonstrates its ability to realize these assets. To the extent the Company determines that the realization of some or all of these benefits is more likely than not based upon expected future taxable income, a portion or all of the valuation allowance will be reversed.

Operating Lease

Operating Lease	6 Months Ended
	Jun. 30, 2019
Leases [Abstract]
Operating Lease	NOTE 10. OPERATING LEASE The Company entered into an operating lease with a third party in September 2012 for office and warehouse space in Lenexa, Kansas. The terms of the lease include monthly payments ranging from $38,026 to $38,533 with a maturity date of April 2020. The Company has the option to renew for an additional three years beyond the original expiration date, which may be exercised at the Company’s sole discretion. The Company evaluated the renewal option at the lease commencement date to determine if it is reasonably certain the exercise the option and concluded that it is not reasonably certain that any options will be exercised. The weighted average remaining lease term for the Company’s operating lease as of June 30, 2019 was .83 years. Expense related to the office space operating lease was recorded on a straight-line basis over the lease term. Lease expense under the operating lease was approximately $198,861 for the six months ended June 30, 2019. The discount rate implicit within the Company’s operating lease was not generally determinable and therefore the Company determined the discount rate based on its incremental borrowing rate on the information available at commencement date. As of June 30, 2019, the operating lease liabilities reflect a weighted average discount rate of 8%. The following sets forth the operating lease right of use assets and liabilities as of June 30, 2019: Assets: Operating lease right of use assets $ 276,338 Liabilities: Operating lease obligations-current portion $ 357,498 Operating lease obligations-less current portion $ — Total operating lease obligations $ 357,498 Following are our minimum lease payments for each year and in total. Year ending December 31: 2019 (period from July 1, 2019 to December 31, 2019) $ 229,170 2020 154,131 Total undiscounted minimum future lease payments 383,301 Imputed interest (25,803 ) $ 357,498

Contingencies

Contingencies	6 Months Ended
	Jun. 30, 2019
Commitments and Contingencies Disclosure [Abstract]
Contingencies	NOTE 11. CONTINGENCIES Litigation. From time to time, we are notified that we may be a party to a lawsuit or that a claim is being made against us. It is our policy to not disclose the specifics of any claim or threatened lawsuit until the summons and complaint are actually served on us. After carefully assessing the claim, and assuming we determine that we are not at fault or we disagree with the damages or relief demanded, we vigorously defend any lawsuit filed against us. We record a liability when losses are deemed probable and reasonably estimable. When losses are deemed reasonably possible but not probable, we determine whether it is possible to provide an estimate of the amount of the loss or range of possible losses for the claim, if material for disclosure. In evaluating matters for accrual and disclosure purposes, we take into consideration factors such as our historical experience with matters of a similar nature, the specific facts and circumstances asserted, the likelihood of our prevailing, the availability of insurance, and the severity of any potential loss. We reevaluate and update accruals as matters progress over time. While the ultimate resolution is unknown we do not expect that these lawsuits will individually, or in the aggregate, have a material adverse effect to our results of operations, financial condition or cash flows. However, the outcome of any litigation is inherently uncertain and there can be no assurance that any expense, liability or damages that may ultimately result from the resolution of these matters will be covered by our insurance or will not be in excess of amounts recognized or provided by insurance coverage and will not have a material adverse effect on our operating results, financial condition or cash flows. Axon The Company owns U.S. Patent No. 9,253,452 (the “ ‘452 Patent”), which generally covers the automatic activation and coordination of multiple recording devices in response to a triggering event, such as a law enforcement officer activating the light bar on the vehicle. The Company filed suit on January 15, 2016 in the U.S. District Court for the District of Kansas (Case No: 2:16-cv-02032) against Axon, alleging willful patent infringement against Axon’s body camera product line and Signal auto-activation product. The Company is seeking both monetary damages and a permanent injunction against Axon for infringement of the ‘452 Patent. In addition to the infringement claims, the Company brought claims alleging that Axon conspired to keep the Company out of the marketplace by engaging in improper, unethical, and unfair competition. The amended lawsuit alleges Axon bribed officials and otherwise conspired to secure no-bid contracts for its products in violation of both state law and federal antitrust law. The Company’s lawsuit also seeks monetary and injunctive relief, including treble damages, for these alleged violations. Axon filed an answer, which denied the patent infringement allegations on April 1, 2016. In addition, Axon filed a motion to dismiss all allegations in the complaint on March 4, 2016 for which the Company filed an amended complaint on March 18, 2016 to address certain technical deficiencies in the pleadings. Digital amended its complaint and Axon renewed its motion to seek dismissal of the allegations that it had bribed officials and otherwise conspired to secure no-bid contracts for its products in violation of both state law and federal antitrust law on April 1, 2016. Formal discovery commenced on April 12, 2016 with respect to the patent related claims. In January 2017, the Court granted Axon’s motion to dismiss the portion of the lawsuit regarding claims that it had bribed officials and otherwise conspired to secure no-bid contracts for its products in violation of both state law and federal antitrust law. On May 2, 2018, the Federal Circuit affirmed the District Court’s ruling and on October 1, 2018 the Supreme Court denied Digital Ally’s petition for review. In December 2016 and January 2017, Axon filed two petitions for Inter Partes The District Court litigation in Kansas was temporarily stayed following the filing of the petitions for IPR. However, on November 17, 2017, the Federal District Court of Kansas rejected Axon’s request to maintain the stay. With this significant ruling, the parties will now proceed towards trial. Since litigation has resumed, the Court has issued a claim construction order (also called a Markman Markman On June 17, 2019, the Court granted Axon’s motion for summary judgment that Axon did not infringe on the Company’s patent and dismissed the case. Importantly, the Court’s ruling did not find that Digital’s ‘452 Patent was invalid. It also did not address any other issue, such as whether Digital’s requested damages were appropriate, and it does not impact the Company’s ability to file additional lawsuits to hold other competitors accountable for patent infringement. This ruling solely related to an interpretation of the claims as they relate to Axon and was unrelated to the supplemental briefing Digital recently filed on its damages claim and the WatchGuard settlement. Those issues are separate and the judge’s ruling on summary judgment had nothing to do with Digital’s damages request. The Company has filed an appeal to this ruling and has asked the appellate court to reverse this decision. WatchGuard On May 27, 2016 the Company filed suit against WatchGuard, (Case No. 2:16-cv-02349-JTM-JPO) alleging patent infringement based on WatchGuard’s VISTA Wifi and 4RE In-Car product lines. On May 13, 2019, the parties resolved the dispute and executed a settlement agreement in the form of a Release and License Agreement. The litigation has been dismissed as a result of this settlement. The Release and License Agreement encompasses the following key terms: ● WatchGuard paid Digital Ally a one-time, lump settlement payment of $6,000,000. ● Digital Ally has granted WatchGuard a perpetual covenant not to sue if WatchGuard’s products incorporate agreed-upon modified recording functionality. Digital Ally has also granted WatchGuard a license to the ‘292 Patent and the ‘452 Patent (and related patents, now existing and yet-to-issue) through December 31, 2023. The parties have agreed to negotiate in good faith to attempt to resolve any alleged infringement that occurs after the license period expires. ● The parties have further agreed to release each other from all claims or liabilities pre-existing the settlement. ● As part of the settlement, the parties agreed that WatchGuard is making no admission that it has infringed any of Digital Ally’s patents. Upon receipt of the $6,000,000 the parties filed a joint motion to dismiss the lawsuit which the Judge granted. PGA Tour, Inc. On January 22, 2019 the PGA Tour, Inc. (the “PGA”) filed suit against the Company in the Federal District Court for the District of Kansas (Case No. 2:19-cv-0033-CM-KGG) alleging breach of contract and breach of implied covenant of good faith and fair dealing relative to the Web.com Tour Title Sponsor Agreement (the “Agreement”). The contract was executed on April 16, 2015 by and between the parties. Under the Agreement, Digital Ally would be a title sponsor of and receive certain naming and other rights and benefits associated with the Web.com Tour for 2015 through 2019 in exchange for Digital Ally’s payment to Tour of annual sponsorship fees. The suit has been resolved and the case has been dismissed by Plaintiff with prejudice on April 17, 2019. 401 (k) Plan. Consulting and Distributor Agreements. On June 1, 2018 the Company entered into an agreement with an individual that required it to make monthly payments that will be applied to future commissions and/or consulting fees to be earned by the provider. Under the agreement, the individual provides consulting services for developing new distribution channels both inside and outside of law enforcement for its in-car and body-worn camera systems and related cloud storage products to customers within and outside the United States. The Company was required to advance amounts to the individual as an advance against commissions of $7,000 per month plus necessary and reasonable expenses for the period through August 31, 2018, which was extended to December 31, 2018 by mutual agreement of the parties at $6,000 per month. The parties have mutually agreed to further extend the arrangement on a monthly basis at $5,000 per month. As of June 30, 2019, the Company had advanced a total of $96,242 pursuant to this agreement.

Stock-Based Compensation

Stock-Based Compensation	6 Months Ended
	Jun. 30, 2019
Share-based Payment Arrangement [Abstract]
Stock-Based Compensation	NOTE 12. STOCK-BASED COMPENSATION The Company recorded pretax compensation expense related to the grant of stock options and restricted stock issued of $585,195 and $594,228 for the three months ended June 30, 2019 and 2018 and $1,310,393 and $1,087,746 for the six months ended June 30, 2019 and 2018, respectively. As of June 30, 2019, the Company had adopted seven separate stock option and restricted stock plans: (i) the 2005 Stock Option and Restricted Stock Plan (the “2005 Plan”), (ii) the 2006 Stock Option and Restricted Stock Plan (the “2006 Plan”), (iii) the 2007 Stock Option and Restricted Stock Plan (the “2007 Plan”), (iv) the 2008 Stock Option and Restricted Stock Plan (the “2008 Plan”), (v) the 2011 Stock Option and Restricted Stock Plan (the “2011 Plan”), (vi) the 2013 Stock Option and Restricted Stock Plan (the “2013 Plan”), (vii) the 2015 Stock Option and Restricted Stock Plan (the “2015 Plan”) and (vii) the 2018 Stock Option and Restricted Stock Plan (the “2018 Plan”). The 2005 Plan, 2006 Plan, 2007 Plan, 2008 Plan, 2011 Plan, 2013 Plan, 2015 Plan and 2018 Plan are referred to as the “Plans.” These Plans permit the grant of stock options or restricted stock to its employees, non-employee directors and others for up to a total of 3,425,000 shares of common stock. The 2005 Plan terminated during 2015 with 14,616 shares not awarded or underlying options, which shares are now unavailable for issuance. Stock options granted under the 2005 Plan that remain unexercised and outstanding as of June 30, 2019 total 13,125. The 2006 Plan terminated during 2016 with 23,399 shares not awarded or underlying options, which shares are now unavailable for issuance. Stock options granted under the 2006 Plan that remain unexercised and outstanding as of June 30, 2019 total 44,075. The 2007 Plan terminated during 2017 with 87,776 shares not awarded or underlying options, which shares are now unavailable for issuance. Stock options granted under the 2007 Plan that remain unexercised and outstanding as of June 30, 2019 total 6,875. The 2008 Plan terminated during 2018 with 8,249 shares not awarded or underlying options, which shares are now unavailable for issuance. Stock options granted under the 2008 Plan that remain unexercised and outstanding as of June 30, 2019 total 32,250. The Company believes that such awards better align the interests of our employees with those of its stockholders. Option awards have been granted with an exercise price equal to the market price of its stock at the date of grant with such option awards generally vesting based on the completion of continuous service and having ten-year contractual terms. These option awards typically provide for accelerated vesting if there is a change in control (as defined in the Plans). The Company has registered all shares of common stock that are issuable under its Plans with the SEC. A total of 626,316 shares remained available for awards under the various Plans as of June 30, 2019. The fair value of each option award is estimated on the date of grant using a Black-Scholes option valuation model. Activity in the various Plans during the six months ended June 30, 2019 is reflected in the following table: Options Number of Shares Weighted Average Exercise Price Outstanding at January 1, 2019 434,012 $ 4.62 Granted 180,000 3.01 Exercised — — Forfeited (17,937 ) (12.43 ) Outstanding at June 30, 2019 596,075 $ 3.90 Exercisable at June 30, 2019 416,075 $ 4.28 The fair value of each option award is estimated on the date of grant using a Black-Scholes option valuation model. Utilizing the following assumptions: risk free rate - 2.23%, estimated term - 5.5 years, and 108% volatility. The total estimated grant date fair value stock options issued during the six months ended June 30, 2019 was $436,217. The Plans allow for the cashless exercise of stock options. This provision allows the option holder to surrender/cancel options with an intrinsic value equivalent to the purchase/exercise price of other options exercised. There were no shares surrendered pursuant to cashless exercises during the six months ended June 30, 2019. At June 30, 2019, the aggregate intrinsic value of options outstanding was approximately $-0- and the aggregate intrinsic value of options exercisable was approximately $-0-. No options were exercised in the six months ended June 30, 2019. As of June 30, 2019, the unrecognized portion of stock compensation expense on all existing stock options was $399,866. The following table summarizes the range of exercise prices and weighted average remaining contractual life for outstanding and exercisable options under the Company’s option plans as of June 30, 2019: Outstanding options Exercisable options Exercise price range Number of options Weighted average remaining contractual life Number of options Weighted average remaining contractual life $ 0.01 to $3.49 471,625 8.9 years 291,625 8.2 years $ 3.50 to $4.99 67,625 4.8 years 67,625 4.8 years $ 5.00 to $6.49 — —years — —years $ 6.50 to $7.99 8,875 2.3 years 8,875 2.3 years $ 8.00 to $9.99 2,500 1.9 years 2,500 1.9 years $ 10.00 to $19.99 39,825 1.5 years 39,825 1.5 years $ 20.00 to $24.99 5,625 0.2 years 5,625 0.2 years 596,075 7.7 years 416,075 6.8 years Restricted stock grants. A summary of all restricted stock activity under the equity compensation plans for the six months ended June 30, 2019 is as follows: Number of Restricted shares Weighted average grant date fair value Nonvested balance, January 1, 2019 772,150 $ 3.40 Granted 522,110 2.91 Vested (397,790 ) (3.84 ) Forfeited (2,500 ) (2.30 ) Nonvested balance, June 30, 2019 893,970 $ 2.92 The Company estimated the fair market value of these restricted stock grants based on the closing market price on the date of grant. As of June 30, 2019, there were $976,035 of total unrecognized compensation costs related to all remaining non-vested restricted stock grants, which will be amortized over the next 18 months in accordance with the respective vesting scale. The nonvested balance of restricted stock vests as follows: Years ended Number of shares 2019 (July 1, 2019 to December 31, 2019) 377,525 2020 265,785 2021 250,660

Common Stock Purchase Warrants

Common Stock Purchase Warrants	6 Months Ended
	Jun. 30, 2019
Equity [Abstract]
Common Stock Purchase Warrants	NOTE 13. COMMON STOCK PURCHASE WARRANTS The Company has issued common stock purchase warrants in conjunction with various debt and equity issuances. The warrants are either immediately exercisable, or have a delayed initial exercise date, no more than nine months from issue date, and allow the holders to purchase up to 4,532,145 shares of common stock at $2.60 to $16.50 per share as of June 30, 2019. The warrants expire from July 15, 2020 through July 31, 2023 and allow for cashless exercise. Warrants Weighted average exercise price Vested Balance, January 1, 2019 4,693,145 $ 5.40 Granted — — Exercised (529,000) (2.96) Cancelled — — Vested Balance, June 30, 2019 4,164,145 $ 5.71 The total intrinsic value of all outstanding warrants aggregated $-0- as of June 30, 2019 and the weighted average remaining term is 28 months. The following table summarizes the range of exercise prices and weighted average remaining contractual life for outstanding and exercisable warrants to purchase common shares as of June 30, 2019: Outstanding and exercisable warrants Exercise price Number of Weighted remaining contractual life $ 2.60 465,712 4.1 years $ 3.00 701,667 3.8 years $ 3.25 120,000 3.5 years $ 3.36 880,000 3.4 years $ 3.50 18,000 0.1 years $ 3.65 200,000 3.0 years $ 3.75 94,000 3.1 years $ 5.00 800,000 2.5 years $ 13.43 879,766 1.5 years $ 16.50 5,000 1.0 years 4,164,145 2.9 years

Net Loss Per Share

Net Loss Per Share	6 Months Ended
	Jun. 30, 2019
Earnings Per Share [Abstract]
Net Loss Per Share	NOTE 14. NET LOSS PER SHARE The calculations of the weighted average number of shares outstanding and loss per share outstanding for the three and six months ended June 30, 2019 and 2018 are as follows: Three Months Ended Six Months Ended 2019 2018 2019 2018 Numerator for basic and diluted income per share – Net loss $ (387,730 ) $ (2,962,890 ) $ (3,592,904 ) $ (5,551,122 ) Denominator for basic loss per share – weighted average shares outstanding 11,305,248 7,129,260 11,124,222 7,153,219 Dilutive effect of shares issuable under stock options and warrants outstanding — — — — Denominator for diluted loss per share – adjusted weighted average shares outstanding 11,305,248 7,129,260 11,124,222 7,153,219 Net loss per share: Basic $ (0.03 ) $ (0.42 ) $ (0.32 ) $ (0.78 ) Diluted $ (0.03 ) $ (0.42 ) $ (0.32 ) $ (0.78 ) Basic loss per share is based upon the weighted average number of common shares outstanding during the period. For the three and six months ended June 30, 2019 and 2018, all outstanding stock options and warrants to purchase common stock were antidilutive, and, therefore, not included in the computation of diluted net loss per share.

Subsequent Events

Subsequent Events	6 Months Ended
	Jun. 30, 2019
Subsequent Events [Abstract]
Subsequent Events	NOTE 15. SUBSEQUENT EVENTS On August 5, 2019, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with several accredited investors (the “Investors”) providing for the purchase and issuance of the following securities for a price of $2,500,000: (i) Issuance of 8% Senior Secured Convertible Promissory Notes due August 4, 2020 (the “Notes”) with a principal face amount of $2,777,779, which Notes are, subject to certain conditions, convertible into 1,984,127 shares of the Company’s common stock (the “Common Stock”), at a price per share of $1.40. Monthly amortization of principal and interest commence on November 5, 2019 subject to prior conversion of shares; (ii) Issuance of five-year warrants to purchase an aggregate of 571,428 shares of Common Stock at an exercise price of $1.8125, subject to customary adjustments thereunder (the “Warrants”), which Warrants are immediately exercisable upon issuance and on a cashless basis if the Warrants have not been registered 180 days after the date of issuance; and (iii) Issuance of 89,285 shares of Common Stock which was equal to 5% of the aggregate purchase price of the Notes, with an aggregate value of $125,000, (iv) The Investors are purchasing the foregoing securities for an aggregate purchase price of $2,500,000. The Company issued to the Investors, an aggregate of $1,153,320 in principal amount of Notes, the shares of common stock issuable from time to time upon conversion of such Registered Notes and all of the 89,285 Commitment Shares were issued to the Investors in a registered direct offering and registered under the Securities Act of 1933. Approximately $1,153,320 of the Notes will be issued pursuant to an effective shelf registration statement. The Company issued to the Investors in a concurrent private placement pursuant to an exemption from the registration requirements of the Securities Act, the remaining aggregate of $1,624,457.78 in principal amount of other Notes, the shares of Common Stock issuable from time to time upon conversion of such other Notes, the Warrants and the Warrant Shares. In connection with the Purchase Agreement, the Company and certain of its subsidiaries entered into a security agreement, dated as of August 5, 2019, with the Investors, pursuant to which the Company and its subsidiary granted to the Investors a security interest in, among other items, the Company and its subsidiaries’ accounts, chattel paper, documents, equipment, general intangibles, instruments and inventory, and all proceeds, as set forth in the Security Agreement. In addition, pursuant to an Intellectual Property Security Agreement, dated as of August 5, 2019, the Company granted to the Investors a continuing security interest in all of the Company’s right, title and interest in, to and under certain of the Company’s trademarks, copyrights and patents. In addition, certain of the Company’s subsidiary jointly and severally agreed to guarantee and act as surety for the Company’s obligation to repay the Notes pursuant to a subsidiary guarantee.

Nature of Business and Summar_2

Nature of Business and Summary of Significant Accounting Policies (Policies)	6 Months Ended
	Jun. 30, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Nature of Business	Nature of Business: Digital Ally, Inc. and subsidiary (collectively, “Digital Ally,” “Digital,” the “Company”) produces digital video imaging and storage products for use in law enforcement, security and commercial applications. Its products are an in-car digital video/audio recorder contained in a rear-view mirror for use in law enforcement and commercial fleets; a system that provides its law enforcement customers with audio/video surveillance from multiple vantage points and hands-free automatic activation of body-worn cameras and in-car video systems; a miniature digital video system designed to be worn on an individual’s body; and cloud storage solutions. The Company has active research and development programs to adapt its technologies to other applications. It can integrate electronic, radio, computer, mechanical, and multi-media technologies to create unique solutions to address needs in a variety of other industries and markets, including mass transit, school bus, taxicab and the military. The Company sells its products to law enforcement agencies and other security organizations and consumer and commercial fleet operators through direct sales domestically and third-party distributors internationally. The Company was originally incorporated in Nevada on December 13, 2000 as Vegas Petra, Inc. and had no operations until 2004. On November 30, 2004, Vegas Petra, Inc. entered into a Plan of Merger with Digital Ally, Inc., at which time the merged entity was renamed Digital Ally, Inc.
Recently Adopted Pronouncements	Recently Adopted Pronouncements In February 2016, the FASB issued Accounting Standard Update (“ASU”) 2016-02, Leases The Company adopted the new guidance on January 1, 2019 using the optional transitional method and elected to use the package of three practical expedients which allows the Company not to reassess whether contracts are or contain leases, lease classification and whether initial direct costs qualify for capitalization. The Company has completed its assessment of the impact of the standard and determined that the only lease that the Company held was an operating lease for its office and warehouse space. Upon adoption of the standard, the Company recorded Right of Use (ROU) assets of approximately $501,000 and lease liabilities of approximately $582,000 related to it office and warehouse space operating leases. The Company also removed deferred rent of approximately $81,000 when adopting the new guidance.
Management's Liquidity Plan	Management’s Liquidity Plan The Company incurred operating losses in the six months ended June 30, 2019 and substantial operating losses for the year ended December 31, 2018 primarily due to reduced revenues and gross margins caused by competitors’ willful infringement of its patents, specifically the auto-activation of body-worn and in-car video systems, and by competitors’ introduction of newer products with more advanced features together with significant price cutting of their products. The Company incurred net losses of approximately $3.6 million for the six months ended June 30, 2019 and $15.5 million during the year ended December 31, 2018 and it had an accumulated deficit of $81.0 million as of June 30, 2019. During the six months ended June 30, 2019, the Company settled one of its patent infringement cases and received a lump sum payment of $6.0 million which was used to pay its obligations under its Proceeds Investment Agreement (the “PIA”), as more fully described in Note 11. In recent years the Company has accessed the public and private capital markets to raise funding through the issuance of debt and equity. In that regard, the Company raised $1,564,000 in the six months ended June 30, 2019 from the exercise of warrants. Additionally, the Company raised funding in the form of subordinated debt, secured debt and proceeds investment agreements totaling $16,500,000, and net proceeds of $7,324,900 from an underwritten public offering of common stock during the year ended December 31, 2018. The Company issued common stock with detachable common stock purchase warrants for $2,776,332 and raised funding from subordinated and secured debt totaling $1,608,500 during the year ended December 31, 2017. During 2016, the Company raised $4.0 million of funding in the form of convertible debentures and common stock purchase warrants. These debt and equity raises were utilized to fund its operations and management expects to continue this pattern until it achieves positive cash flows from operations, although it can offer no assurance in this regard. The Company retired all interest-bearing debt outstanding during the year ended December 31, 2018. The only long-term obligations outstanding as of June 30, 2019 are associated with the PIA that the Company entered into during July 2018, as more fully described in Note 6. On August 5, 2019, the Company raised funds from the issuance of $2.78 million principal balance of convertible debentures with detachable warrants to purchase 571,248 shares of common stock with the net proceeds being used for working capital purposes, as more fully described in Note 15. The Company settled its lawsuit with the PGA Tour and the case was dismissed by the Plaintiff with prejudice on April 17, 2019. See Note 11, “Contingencies” for the details respecting the settlement. Additionally, the Company settled its lawsuit with WatchGuard on May 13, 2019 and the case was dismissed. See Note 11, “Contingencies” for the details respecting the settlement. The Company will have to restore positive operating cash flows and profitability over the next year and/or raise additional capital to fund its operational plans, meet its customary payment obligations and otherwise execute its business plan. There can be no assurance that it will be successful in restoring positive cash flows and profitability, or that it can raise additional financing when needed, and obtain it on terms acceptable or favorable to the Company. The Company has implemented an enhanced quality control program to detect and correct product issues before they result in significant rework expenditures affecting its gross margins and has seen progress in that regard. In addition, the Company undertook a number of cost reduction initiatives in 2018, including a reduction of its workforce by approximately 40%, restructuring its direct sales force and cutting other selling, general and administrative costs. The Company has increased its addressable market to non-law enforcement customers and obtained new non-law enforcement contracts in 2018, which contracts include recurring revenue during the period 2019 to 2020. The Company believes that its quality control, headcount reduction and cost cutting initiatives, expansion to non-law enforcement sales channels and new product introduction will eventually restore positive operating cash flows and profitability, although it can offer no assurances in this regard. In addition to the initiatives described above, the Board of Directors continues to conduct its review of a full range of strategic alternatives to best position the Company for the future, including, but not limited to, monetizing its patent portfolio and related patent infringement litigation against Axon Enterprise, Inc. (“Axon,” formerly Taser International, Inc.), the sale of all or certain assets, properties or groups of properties or individual businesses or merger or combination with another company. The result of this review may also include the continued implementation of the Company’s business plan. The August 5, 2019 issuance of $2.78 million principal balance of convertible notes was part of this strategic alternatives review. While such funding addressed the Company’s near-term liquidity needs, it continues to consider strategic alternatives to address longer-term liquidity needs and operational issues. There can be no assurance that any additional transactions or financings will result from this process. Based on the uncertainties described above, the Company believes its business plan does not alleviate the existence of substantial doubt about its ability to continue as a going concern within one year from the date of the issuance of these condensed consolidated interim financial statements.
Basis of Consolidation	Basis of Consolidation: The accompanying financial statements include the consolidated accounts of Digital Ally and its wholly-owned subsidiary, Digital Ally International, Inc. All intercompany balances and transactions have been eliminated during consolidation. The Company formed Digital Ally International, Inc. during August 2009 to facilitate the export sales of its products.
Fair Value of Financial Instruments	Fair Value of Financial Instruments: The carrying amounts of financial instruments, including cash and cash equivalents, accounts receivable and accounts payable approximate fair value because of the short-term nature of these items. The Company accounts for its proceeds investment agreement on a fair value basis.
Revenue Recognition	Revenue Recognition: The Company applies the provisions of Accounting Standards Codification (ASC) 606-10, Revenue from Contracts with Customers The Company considers customer purchase orders, which in some cases are governed by master sales agreements, to be the contracts with the customer. In situation where sales are to a distributor, the Company had concluded its contracts are with the distributor as the Company holds a contract bearing enforceable rights and obligations only with the distributor. As part of part of its consideration for the contract, the Company evaluates certain factors including the customers’ ability to pay (or credit risk). For each contract, the Company considers the promise to transfer products, each of which is distinct, to be the identified performance obligations. In determining the transaction price, the Company evaluates whether the price is subject to refund or adjustment to determine the net consideration to which it expects to be entitled. As the Company’s standard payment terms are less than one year, it has elected the practical expedient under ASC 606-10-32-18 to not assess whether a contract has a significant financing component. The Company allocates the transaction price to each distinct product based on its relative standalone selling price. The product price as specified on the purchase order is considered the standalone selling price as it is an observable input which depicts the price as if sold to a similar customer in similar circumstances. Revenue is recognized when control of the product is transferred to the customer (i.e. when the Company’s performance obligations is satisfied), which typically occurs at shipment. Further in determining whether control has been transferred, the Company considers if there is a present right to payment and legal title, along with risks and rewards of ownership having transferred to the customer. Customers do not have a right to return the product other than for warranty reasons for which they would only receive repair services or replacement product. The Company has also elected the practical expedient under ASC 340-40-25-4 to expense commissions for product sales when incurred as the amortization period of the commission asset the Company would have otherwise recognized is less than one year. The Company sells its products and services to law enforcement and commercial customers in the following manner: ● Sales to domestic customers are made direct to the end customer (typically a law enforcement agency or a commercial customer) through its sales force, which is composed of its employees. Revenue is recorded when the product is shipped to the end customer. ● Sales to international customers are made through independent distributors who purchase products from the Company at a wholesale price and sell to the end user (typically law enforcement agencies or a commercial customer) at a retail price. The distributor retains the margin as its compensation for its role in the transaction. The distributor generally maintains product inventory, customer receivables and all related risks and rewards of ownership. Accordingly, upon application of steps one through five above, revenue is recorded when the product is shipped to the distributor consistent with the terms of the distribution agreement. ● Repair parts and services for domestic and international customers are generally handled by its inside customer service employees. Revenue is recognized upon shipment of the repair parts and acceptance of the service or materials by the end customer. Sales taxes collected on products sold are excluded from revenues and are reported as accrued expenses in the accompanying balance sheets until payments are remitted. Service and other revenue is comprised of revenues from extended warranties, repair services, cloud revenue and software revenue. Revenue is recognized upon shipment of the product and acceptance of the service or materials by the end customer for repair services. Revenue for extended warranty, cloud service or other software-based products is over the term of the contract warranty or service period. A time-elapsed method is used to measure progress because the Company transfers control evenly over the contractual period. Accordingly, the fixed consideration related to these revenues is generally recognized on a straight-line basis over the contract term, as long as the other revenue recognition criteria have been met. Contracts with some of the Company’s customers contain multiple performance obligations that are distinct and accounted for separately. The transaction price is allocated to the separate performance obligations on a relative standalone selling price (“SSP”). The Company determined SSP for all the performance obligations using observable inputs, such as standalone sales and historical pricing. SSP is consistent with the Company’s overall pricing objectives, taking into consideration the type of service being provided. SSP also reflects the amount the Company would charge for the performance obligation if it were sold separately in a standalone sale. Multiple performance obligations consist of product, software, cloud subscriptions and extended warranties. The Company’s multiple performance obligations may include future in-car or body-worn camera devices to be delivered at defined points within a multi-year contract, and in those arrangements, the Company allocates total arrangement consideration over the life of the multi-year contract to future deliverables using management’s best estimate of selling price. Contract liabilities consist of deferred revenue and include payments received in advance of performance under the contract and are reported separately as current liabilities and non-current liabilities in the Condensed Consolidated Balance Sheets. Such amounts consist of extended warranty contracts, prepaid cloud services and prepaid installation services and are generally recognized as the respective performance obligations are satisfied. Total contract liabilities consist of the following: June 30, 2019 December 31, 2018 Contract liabilities, current $ 1,794,457 $ 1,748,789 Contract liabilities, non-current 1,864,989 1,991,091 Total contract liabilities $ 3,659,446 $ 3,739,880 Sales returns and allowances aggregated $37,978 and $34,227 for the three months ended June 30, 2019 and 2018, respectively, and $112,237 and $54,246 for the six months ended June 30, 2019 and 2018, respectively. Obligations for estimated sales returns and allowances are recognized at the time of sales on an accrual basis. The accrual is determined based upon historical return rates adjusted for known changes in key variables affecting these return rates Revenues for six month ended June 30, 2019 and 2018 were derived from the following sources Six months ended June 30, 2019 2018 DVM-800 $ 1,979,681 $ 2,860,907 DVM-250 Plus 427,343 366,351 FirstVu HD 735,222 642,665 EVO 62,942 — DVM-100 & DVM-400 6,765 64,401 DVM-750 72,549 213,935 VuLink 73,919 133,001 Repair and service 734,332 627,874 Cloud service revenue 349,337 326,741 Other service revenue 94,430 95,635 Laser Ally 19,130 22,530 Accessories and other revenues 542,129 681,023 $ 5,097,779 $ 6,035,063
Use of Estimates	Use of Estimates: The preparation of the condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Cash and Cash Equivalents	Cash and cash equivalents: Cash and cash equivalents include funds on hand, in bank and short-term investments with original maturities of ninety (90) days or less.
Accounts Receivable	Accounts Receivable: Accounts receivable are carried at original invoice amount less an estimate made for doubtful receivables based on a review of all outstanding amounts on a weekly basis. The Company determines the allowance for doubtful accounts by regularly evaluating individual customer receivables and considering a customer’s financial condition, credit history, and current economic conditions. Trade receivables are written off when deemed uncollectible. Recoveries of trade receivables previously written off are recorded when received. A trade receivable is considered to be past due if any portion of the receivable balance is outstanding for more than thirty (30) days beyond terms. No interest is charged on overdue trade receivables.
Inventories	Inventories: Inventories consist of electronic parts, circuitry boards, camera parts and ancillary parts (collectively, “components”), work-in-process and finished goods, and are carried at the lower of cost (First-in, First-out Method) or market value. The Company determines the estimate for the reserve for slow moving or obsolete inventories by regularly evaluating individual inventory levels, projected sales and current economic conditions.
Furniture, Fixtures and Equipment	Furniture, fixtures and equipment: Furniture, fixtures and equipment is stated at cost net of accumulated depreciation. Additions and improvements are capitalized while ordinary maintenance and repair expenditures are charged to expense as incurred. Depreciation is recorded by the straight-line method over the estimated useful life of the asset, which ranges from three to ten years. Amortization expense on capitalized leases is included with depreciation expense.
Intangible Assets	Intangible assets: Intangible assets include deferred patent costs and license agreements. Legal expenses incurred in preparation of patent application have been deferred and will be amortized over the useful life of granted patents. Costs incurred in preparation of applications that are not granted will be charged to expense at that time. The Company has entered into several sublicense agreements under which it has been assigned the exclusive rights to certain licensed materials used in its products. These sublicense agreements generally require upfront payments to obtain the exclusive rights to such material. The Company capitalizes the upfront payments as intangible assets and amortizes such costs over their estimated useful life on a straight-line method.
Leases	Leases: The Company determines if an arrangement contains a lease at inception. For arrangements where the Company is the lessee, the Company will evaluate whether to account for the lease as an operating or finance lease. Operating leases are included in the right of use assets (ROU) and operating lease liabilities on the condensed consolidated balance sheet as of June 30, 2019. Finance leases would be included in furniture, fixtures and equipment, net and long-term debt and finance lease obligations on the condensed balance sheet. The Company had an operating lease for office and warehouse space at June 30, 2019 but no financing leases. ROU assets and lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. The Company uses its incremental borrowing rate based on the information available at the commencement date in determining the operating lease liabilities if the operating lease does not provide an implicit rate. Lease terms may include the option to extend when Company is reasonably certain that the option will be exercised. Lease expense for operating leases is recognized on a straight-line basis over the lease term The Company elected to apply the short-term lease measurement and recognition exemption in which ROU assets and lease liabilities are not recognized for short term leases.
Proceeds Investment Agreement	Proceeds investment agreement: The Company has elected to record its proceeds investment agreement at its fair value. Accordingly, the proceeds investment agreement will be marked-to-market at each reporting date with the change in fair value reported as a gain (loss) in the Condensed Consolidated Statement of Operations. All issuance costs related to the proceeds investment agreement were expensed as incurred in the Condensed Consolidated Statement of Operations.
Long-Lived Assets	Long-Lived Assets: Long-lived assets such as furniture, fixtures and equipment and purchased intangible assets subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset or asset group be tested for possible impairment, the Company first compares undiscounted cash flows expected to be generated by that asset or asset group to its carrying value. If the carrying value of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying value exceeds its fair value. Fair value is determined through various valuation techniques, including discounted cash flow models, quoted market values and third-party appraisals, as considered necessary.
Warranties	Warranties: The Company’s products carry explicit product warranties that extend up to two years from the date of shipment. The Company records a provision for estimated warranty costs based upon historical warranty loss experience and periodically adjusts these provisions to reflect actual experience. Accrued warranty costs are included in accrued expenses. Extended warranties are offered on selected products and when a customer purchases an extended warranty the associated proceeds are treated as contract liabilities and recognized over the term of the extended warranty.
Shipping and Handling Costs	Shipping and Handling Costs: Shipping and handling costs for outbound sales orders totaled $13,158 and $20,317 for the three months ended June 30, 2019 and 2018, respectively, and $31,578 and $34,284 for the six months ended June 30, 2019 and 2018, respectively. Such costs are included in selling, general and administrative expenses in the Condensed Consolidated Statements of Operations.
Advertising Costs	Advertising Costs: Advertising expense includes costs related to trade shows and conventions, promotional material and supplies, and media costs. Advertising costs are expensed in the period in which they are incurred. The Company incurred total advertising expense of approximately $510,792 and $111,677 for the three months ended June 30, 2019 and 2018, respectively, and $634,807 and $191,246 for the six months ended June 30, 2019 and 2018, respectively. The increase was primarily attributable to our sponsorship of a NASCAR race in May 2019 and other related sponsorship opportunities. Such costs are included in selling, general and administrative expenses in the Condensed Consolidated Statements of Operations.
Income Taxes	Income Taxes: Deferred taxes are provided for by the liability method in which deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax basis. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The Company applies the provisions of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) No. 740 - Income Taxes that provides a framework for accounting for uncertainty in income taxes and provided a comprehensive model to recognize, measure, present, and disclose in its financial statements uncertain tax positions taken or expected to be taken on a tax return. It initially recognizes tax positions in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions are initially and subsequently measured as the largest amount of tax benefit that is greater than 50% likely of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and all relevant facts. Application requires numerous estimates based on available information. The Company considers many factors when evaluating and estimating its tax positions and tax benefits, and it recognized tax positions and tax benefits may not accurately anticipate actual outcomes. As it obtains additional information, the Company may need to periodically adjust its recognized tax positions and tax benefits. These periodic adjustments may have a material impact on its Condensed consolidated Statements of Operations. The Company’s policy is to record estimated interest and penalties related to the underpayment of income taxes as income tax expense in the condensed consolidated statements of operations. There was no interest expense related to the underpayment of estimated taxes during the six months ended June 30, 2019 and 2018. There were no penalties in the six months ended June 30, 2019 and 2018. The Company is subject to taxation in the United States and various states. As of June 30, 2019, the Company’s tax returns filed for 2015, 2016, and 2017 and to be filed for 2018 are subject to examination by the relevant taxing authorities. With few exceptions, as of June 30, 2019, the Company is no longer subject to Federal, state, or local examinations by tax authorities for years before 2015.
Research and Development Expenses	Research and Development Expenses: The Company expenses all research and development costs as incurred. Development costs of computer software to be sold, leased, or otherwise marketed are subject to capitalization beginning when a product’s technological feasibility has been established and ending when a product is available for general release to customers. In most instances, the Company’s products are released soon after technological feasibility has been established. Costs incurred subsequent to achievement of technological feasibility were not significant, and software development costs were expensed as incurred during the six months ended June 30, 2019 and 2018.
Common Stock Purchase Warrants	Common Stock Purchase Warrants: The Company has common stock purchase warrants that are accounted for as equity based on their relative fair value and are not subject to re-measurement.
Stock-Based Compensation	Stock-Based Compensation: The Company grants stock-based compensation to its employees, board of directors and certain third-party contractors. Share-based compensation arrangements may include the issuance of options to purchase common stock in the future or the issuance of restricted stock, which generally are subject to vesting requirements. The Company records stock-based compensation expense for all stock-based compensation granted based on the grant-date fair value. The Company recognizes these compensation costs on a straight-line basis over the requisite service period of the award. The Company estimates the grant-date fair value of stock-based compensation using the Black-Scholes valuation model. Assumptions used to estimate compensation expense are determined as follows: ● Expected term is determined using the contractual term and vesting period of the award; ● Expected volatility of award grants made in the Company’s plan is measured using the weighted average of historical daily changes in the market price of the Company’s common stock over the period equal to the expected term of the award; ● Expected dividend rate is determined based on expected dividends to be declared; ● Risk-free interest rate is equivalent to the implied yield on zero-coupon U.S. Treasury bonds with a maturity equal to the expected term of the awards; and ● Forfeitures are accounted for as they occur.
Segments of Business	Segments of Business: Management has determined that its operations are comprised of one reportable segment: the sale of digital audio and video recording and speed detection devices. For the three and six months ended June 30, 2019 and 2018, sales by geographic area were as follows: Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 Sales by geographic area: United States of America $ 2,477,717 $ 3,386,146 $ 4,992,059 $ 5,824,934 Foreign 69,266 177,404 105,720 210,129 $ 2,546,983 $ 3,563,550 $ 5,097,779 $ 6,035,063 Sales to customers outside of the United States are denominated in U.S. dollars. All Company assets are physically located within the United States.
Recent Accounting Pronouncements	Recent Accounting Pronouncements There were no new material accounting pronouncements that were applicable to the Company for the six months ended June 30, 2019.

Nature of Business and Summar_3

Nature of Business and Summary of Significant Accounting Policies (Tables)	6 Months Ended
	Jun. 30, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Schedule of Contract Liabilities	Total contract liabilities consist of the following: June 30, 2019 December 31, 2018 Contract liabilities, current $ 1,794,457 $ 1,748,789 Contract liabilities, non-current 1,864,989 1,991,091 Total contract liabilities $ 3,659,446 $ 3,739,880
Schedule of Revenues	Revenues for six month ended June 30, 2019 and 2018 were derived from the following sources Six months ended June 30, 2019 2018 DVM-800 $ 1,979,681 $ 2,860,907 DVM-250 Plus 427,343 366,351 FirstVu HD 735,222 642,665 EVO 62,942 — DVM-100 & DVM-400 6,765 64,401 DVM-750 72,549 213,935 VuLink 73,919 133,001 Repair and service 734,332 627,874 Cloud service revenue 349,337 326,741 Other service revenue 94,430 95,635 Laser Ally 19,130 22,530 Accessories and other revenues 542,129 681,023 $ 5,097,779 $ 6,035,063
Summary of Sales by Geographic Area	For the three and six months ended June 30, 2019 and 2018, sales by geographic area were as follows: Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 Sales by geographic area: United States of America $ 2,477,717 $ 3,386,146 $ 4,992,059 $ 5,824,934 Foreign 69,266 177,404 105,720 210,129 $ 2,546,983 $ 3,563,550 $ 5,097,779 $ 6,035,063

Inventories (Tables)

Inventories (Tables)	6 Months Ended
	Jun. 30, 2019
Inventory Disclosure [Abstract]
Schedule of Inventories	Inventories consisted of the following at June 30, 2019 and December 31, 2018: June 30, 2019 December 31, 2018 Raw material and component parts $ 4,903,170 $ 4,969,786 Work-in-process 256,910 351,451 Finished goods 5,291,233 4,965,594 Subtotal 10,451,313 10,286,831 Reserve for excess and obsolete inventory (3,659,264 ) (3,287,771 ) Total $ 6,792,049 $ 6,990,060

Furniture, Fixtures and Equip_2

Furniture, Fixtures and Equipment (Tables)	6 Months Ended
	Jun. 30, 2019
Property, Plant and Equipment [Abstract]
Schedule of Furniture, Fixtures and Equipment	Furniture, fixtures and equipment consisted of the following at June 30, 2019 and December 31, 2018: Estimated Useful Life June 30, 2019 December 31, 2018 Office furniture, fixtures and equipment 3-10 years $ 821,453 $ 802,681 Warehouse and production equipment 3-5 years 537,471 526,932 Demonstration and tradeshow equipment 2-5 years 466,394 426,582 Leasehold improvements 2-5 years 163,171 160,198 Rental equipment 1-3 years 126,163 124,553 Total cost 2,114,652 2,040,946 Less: accumulated depreciation and amortization (1,931,677 ) (1,793,405 ) Net furniture, fixtures and equipment $ 182,975 $ 247,541

Debt Obligations (Tables)

Debt Obligations (Tables)	6 Months Ended
	Jun. 30, 2019
Debt Disclosure [Abstract]
Summary of Secured Convertible Debentures and Proceeds Investment Agreement	Proceeds investment agreement is comprised of the following: June 30, 2019 December 31, 2018 2018 Proceeds Investment Agreement, at fair value $ 6,240,000 $ 9,142,000 Less: Current portion - - 2018 Proceeds investment agreement at fair value-less current portion $ 6,240,000 $ 9,142,000
Schedule of Fair Value of Embedded Derivatives and Warrants	The Company elected to account for the PIA on the fair value basis. Therefore, the Company determined the fair value of the PIA and PIA Warrants which yielded estimated fair values of the PIA including their embedded derivatives and the detachable PIA Warrants as follows: Proceeds investment agreement $ 9,067,513 Common stock purchase warrants 932,487 Gross cash proceeds $ 10,000,000
Schedule of Fair Value of Debentures Activity	The following represents activity in the PIA during the six months ended June 30, 2019: Beginning balance as of January 1, 2019 $ 9,142,000 Repayment of obligation (6,000,000 ) Change in the fair value during the period 3,098,000 Ending balance as of June 30, 2019 $ 6,240,000

Fair Value Measurement (Tables)

Fair Value Measurement (Tables)	6 Months Ended
	Jun. 30, 2019
Fair Value Disclosures [Abstract]
Financial Assets and Liabilities Measured at Fair Value on Recurring Basis	The following table represents the Company’s hierarchy for its financial assets and liabilities measured at fair value on a recurring basis as of June 30, 2019 and December 31, 2018. June 30, 2019 Level 1 Level 2 Level 3 Total Liabilities: Proceeds Investment Agreement $ — $ — $ 6,240,000 $ 6,240,000 December 31, 2018 Level 1 Level 2 Level 3 Total Liabilities: Proceeds Investment Agreement $ — $ — $ 9,142,000 $ 9,142,000
Fair Value Measurements Change in Level 3 Inputs	The following table represents the change in Level 3 tier value measurements: Proceeds December 31, 2018 $ 9,142,000 Repayment of obligation (6,000,000 ) Change in fair value 3,098,000 June 30, 2019 $ 6,240,000

Accrued Expenses (Tables)

Accrued Expenses (Tables)	6 Months Ended
	Jun. 30, 2019
Payables and Accruals [Abstract]
Schedule of Accrued Expenses	Accrued expenses consisted of the following at June 30, 2019 and December 31, 2018: June 30, 2019 December 31, 2018 Accrued warranty expense $ 102,955 $ 195,135 Accrued litigation costs 363,508 1,119,445 Accrued sales commissions 26,553 25,750 Accrued payroll and related fringes 265,258 186,456 Accrued insurance 39,112 71,053 Accrued sales returns and allowances 28,714 13,674 Other 236,134 469,154 $ 1,062,234 $ 2,080,667
Schedule of Accrued Warranty Expense	Accrued warranty expense was comprised of the following for the six months ended June 30, 2019: 2019 Beginning balance $ 195,135 Provision for warranty expense 25,341 Charges applied to warranty reserve (117,521 ) Ending balance $ 102,955

Operating Lease (Tables)

Operating Lease (Tables)	6 Months Ended
	Jun. 30, 2019
Leases [Abstract]
Schedule of Operating Leases Right of Use Assets and Liabilities	The following sets forth the operating lease right of use assets and liabilities as of June 30, 2019: Assets: Operating lease right of use assets $ 276,338 Liabilities: Operating lease obligations-current portion $ 357,498 Operating lease obligations-less current portion $ — Total operating lease obligations $ 357,498
Schedule of Future Minimum Lease Payments	Following are our minimum lease payments for each year and in total. Year ending December 31: 2019 (period from July 1, 2019 to December 31, 2019) $ 229,170 2020 154,131 Total undiscounted minimum future lease payments 383,301 Imputed interest (25,803 ) $ 357,498

Stock-Based Compensation (Table

Stock-Based Compensation (Tables)	6 Months Ended
	Jun. 30, 2019
Share-based Payment Arrangement [Abstract]
Summary of Stock Options Outstanding	Activity in the various Plans during the six months ended June 30, 2019 is reflected in the following table: Options Number of Shares Weighted Average Exercise Price Outstanding at January 1, 2019 434,012 $ 4.62 Granted 180,000 3.01 Exercised — — Forfeited (17,937 ) (12.43 ) Outstanding at June 30, 2019 596,075 $ 3.90 Exercisable at June 30, 2019 416,075 $ 4.28
Shares Authorized Under Stock Option Plans by Exercise Price Range	The following table summarizes the range of exercise prices and weighted average remaining contractual life for outstanding and exercisable options under the Company’s option plans as of June 30, 2019: Outstanding options Exercisable options Exercise price range Number of options Weighted average remaining contractual life Number of options Weighted average remaining contractual life $ 0.01 to $3.49 471,625 8.9 years 291,625 8.2 years $ 3.50 to $4.99 67,625 4.8 years 67,625 4.8 years $ 5.00 to $6.49 — —years — —years $ 6.50 to $7.99 8,875 2.3 years 8,875 2.3 years $ 8.00 to $9.99 2,500 1.9 years 2,500 1.9 years $ 10.00 to $19.99 39,825 1.5 years 39,825 1.5 years $ 20.00 to $24.99 5,625 0.2 years 5,625 0.2 years 596,075 7.7 years 416,075 6.8 years
Summary of Restricted Stock Activity	A summary of all restricted stock activity under the equity compensation plans for the six months ended June 30, 2019 is as follows: Number of Restricted shares Weighted average grant date fair value Nonvested balance, January 1, 2019 772,150 $ 3.40 Granted 522,110 2.91 Vested (397,790 ) (3.84 ) Forfeited (2,500 ) (2.30 ) Nonvested balance, June 30, 2019 893,970 $ 2.92
Schedule of Non-vested Balance of Restricted Stock	The nonvested balance of restricted stock vests as follows: Years ended Number of shares 2019 (July 1, 2019 to December 31, 2019) 377,525 2020 265,785 2021 250,660

Common Stock Purchase Warrants

Common Stock Purchase Warrants (Tables)	6 Months Ended
	Jun. 30, 2019
Equity [Abstract]
Summary of Warrant Activity	The warrants expire from July 15, 2020 through July 31, 2023 and allow for cashless exercise. Warrants Weighted average exercise price Vested Balance, January 1, 2019 4,693,145 $ 5.40 Granted — — Exercised (529,000) (2.96) Cancelled — — Vested Balance, June 30, 2019 4,164,145 $ 5.71
Summary of Range of Exercise Prices and Weighted Average Remaining Contractual Life of Warrants	The following table summarizes the range of exercise prices and weighted average remaining contractual life for outstanding and exercisable warrants to purchase common shares as of June 30, 2019: Outstanding and exercisable warrants Exercise price Number of Weighted remaining contractual life $ 2.60 465,712 4.1 years $ 3.00 701,667 3.8 years $ 3.25 120,000 3.5 years $ 3.36 880,000 3.4 years $ 3.50 18,000 0.1 years $ 3.65 200,000 3.0 years $ 3.75 94,000 3.1 years $ 5.00 800,000 2.5 years $ 13.43 879,766 1.5 years $ 16.50 5,000 1.0 years 4,164,145 2.9 years

Net Loss Per Share (Tables)

Net Loss Per Share (Tables)	6 Months Ended
	Jun. 30, 2019
Earnings Per Share [Abstract]
Calculation of Weighted Average Number of Shares Outstanding and Loss Per Share Outstanding	The calculations of the weighted average number of shares outstanding and loss per share outstanding for the three and six months ended June 30, 2019 and 2018 are as follows: Three Months Ended Six Months Ended 2019 2018 2019 2018 Numerator for basic and diluted income per share – Net loss $ (387,730 ) $ (2,962,890 ) $ (3,592,904 ) $ (5,551,122 ) Denominator for basic loss per share – weighted average shares outstanding 11,305,248 7,129,260 11,124,222 7,153,219 Dilutive effect of shares issuable under stock options and warrants outstanding — — — — Denominator for diluted loss per share – adjusted weighted average shares outstanding 11,305,248 7,129,260 11,124,222 7,153,219 Net loss per share: Basic $ (0.03 ) $ (0.42 ) $ (0.32 ) $ (0.78 ) Diluted $ (0.03 ) $ (0.42 ) $ (0.32 ) $ (0.78 )

Nature of Business and Summar_4

Nature of Business and Summary of Significant Accounting Policies (Details Narrative)	Aug. 05, 2019USD ($)shares	Jun. 30, 2019USD ($)	Mar. 31, 2019USD ($)	Jun. 30, 2018USD ($)	Mar. 31, 2018USD ($)	Jun. 30, 2019USD ($)Integer	Jun. 30, 2018USD ($)	Dec. 31, 2018USD ($)	Dec. 31, 2017USD ($)	Dec. 31, 2016USD ($)	Jan. 02, 2019USD ($)
Operating lease right of use assets		$ 276,338				$ 276,338
Operating lease obligations		357,498				357,498
Net losses		(387,730)	$ (3,205,174)	$ (2,962,890)	$ (2,588,232)	(3,592,904)	$ (5,551,122)	15,500,000
Accumulated deficit		$ (80,975,810)				(80,975,810)		(77,382,906)
Lump sum payment received						6,000,000
Proceeds from exercise of warrants						1,564,000
Proceeds from debt								16,500,000
Proceeds from sale of common stock in underwritten public offering								$ 7,324,900
Proceeds from issuance of common stock and detachable common stock purchase warrants									$ 2,776,332
Subordinated and secured debt									$ 1,608,500
Proceeds from secured convertible debentures and detachable common stock purchase warrants							6,250,000			$ 4,000,000
Percentage of reduction on lay-off of employees		40.00%				40.00%
Sales returns and allowances		$ 37,978		34,227		$ 112,237	54,246
Shipping and handling costs		13,158		20,317		31,578	34,284
Advertising expense		510,792		111,677		$ 634,807	191,246
Percentage of income tax benefit likely of being realized upon settlement with tax authority						greater than 50%
Penalties
Number of reportable segments | Integer						1
Minimum [Member]
Estimated useful life of furniture, fixtures and equipment						3 years
Maximum [Member]
Estimated useful life of furniture, fixtures and equipment						10 years
Subsequent Event [Member]
Proceeds from convertible debentures	$ 2,780,000
Warrants to purchase common stock | shares	571,248
ASU 2016-02 Leases [Member]
Operating lease right of use assets											$ 501,000
Operating lease obligations											582,000
Deferred rent											$ 81,000

Nature of Business and Summar_5

Nature of Business and Summary of Significant Accounting Policies - Schedule of Contract Liabilities (Details) - USD ($)	Jun. 30, 2019	Dec. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Contract liabilities, current	$ 1,794,457	$ 1,748,789
Contract liabilities, non-current	1,864,989	1,991,091
Total contract liabilities	$ 3,659,446	$ 3,739,880

Nature of Business and Summar_6

Nature of Business and Summary of Significant Accounting Policies - Schedule of Revenues (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Revenue	$ 2,546,983	$ 3,563,550	$ 5,097,779	$ 6,035,063
DVM-800 [Member]
Revenue			1,979,681	2,860,907
DVM-250 Plus [Member]
Revenue			427,343	366,351
FirstVu HD [Member]
Revenue			735,222	642,665
EVO [Member]
Revenue			62,942
DVM-100 & DVM-400 [Member]
Revenue			6,765	64,401
DVM-750 [Member]
Revenue			72,549	213,935
VuLink [Member]
Revenue			73,919	133,001
Repair and service [Member]
Revenue			734,332	627,874
Cloud Service Revenue [Member]
Revenue			349,337	326,741
Other Service Revenue [Member]
Revenue			94,430	95,635
Laser Ally [Member]
Revenue			19,130	22,530
Accessories and Other Revenues [Member]
Revenue			$ 542,129	$ 681,023

Nature of Business and Summar_7

Nature of Business and Summary of Significant Accounting Policies - Summary of Sales by Geographic Area (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Sales by geographic area	$ 2,546,983	$ 3,563,550	$ 5,097,779	$ 6,035,063
United States of America [Member]
Sales by geographic area	2,477,717	3,386,146	4,992,059	5,824,934
Foreign [Member]
Sales by geographic area	$ 69,266	$ 177,404	$ 105,720	$ 210,129

Concentration of Credit Risk _2

Concentration of Credit Risk and Major Customers (Details Narrative) - USD ($)	6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Dec. 31, 2018
Allowance for doubtful accounts	$ 90,000		$ 70,000
No International Distributor [Member] | Revenue [Member]
Percentage of concentration risk	10.00%
No International Distributor [Member] | Revenue [Member]
Percentage of concentration risk		10.00%
No Customer Receivable [Member] | Accounts Receivable [Member]
Percentage of concentration risk	10.00%	10.00%

Inventories (Details Narrative)

Inventories (Details Narrative) - USD ($)	Jun. 30, 2019	Dec. 31, 2018
Inventory Disclosure [Abstract]
Finished goods inventory	$ 141,609	$ 115,456

Inventories - Schedule of Inven

Inventories - Schedule of Inventories (Details) - USD ($)	Jun. 30, 2019	Dec. 31, 2018
Inventory Disclosure [Abstract]
Raw material and component parts	$ 4,903,170	$ 4,969,786
Work-in-process	256,910	351,451
Finished goods	5,291,233	4,965,594
Subtotal	10,451,313	10,286,831
Reserve for excess and obsolete inventory	(3,659,264)	(3,287,771)
Total	$ 6,792,049	$ 6,999,060

Furniture, Fixtures and Equip_3

Furniture, Fixtures and Equipment (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Property, Plant and Equipment [Abstract]
Depreciation and amortization of furniture fixtures and equipment	$ 63,506	$ 101,252	$ 138,272	$ 217,802

Furniture, Fixtures and Equip_4

Furniture, Fixtures and Equipment - Schedule of Furniture, Fixtures and Equipment (Details) - USD ($)	6 Months Ended
	Jun. 30, 2019	Dec. 31, 2018
Office furniture, fixtures and equipment	$ 821,453	$ 802,681
Warehouse and production equipment	537,471	526,932
Demonstration and tradeshow equipment	466,394	426,582
Leasehold improvements	163,171	160,198
Rental equipment	126,163	124,553
Total cost	2,114,652	2,040,946
Less: accumulated depreciation and amortization	(1,931,677)	(1,793,405)
Net furniture, fixtures and equipment	$ 182,975	$ 247,541
Minimum [Member]
Estimated Useful Life	3 years
Maximum [Member]
Estimated Useful Life	10 years
Office Furniture, Fixtures and Equipment [Member] | Minimum [Member]
Estimated Useful Life	3 years
Office Furniture, Fixtures and Equipment [Member] | Maximum [Member]
Estimated Useful Life	10 years
Warehouse and Production Equipment [Member] | Minimum [Member]
Estimated Useful Life	3 years
Warehouse and Production Equipment [Member] | Maximum [Member]
Estimated Useful Life	5 years
Demonstration and Tradeshow Equipment [Member] | Minimum [Member]
Estimated Useful Life	2 years
Demonstration and Tradeshow Equipment [Member] | Maximum [Member]
Estimated Useful Life	5 years
Leasehold Improvements [Member] | Minimum [Member]
Estimated Useful Life	2 years
Leasehold Improvements [Member] | Maximum [Member]
Estimated Useful Life	5 years
Rental Equipment [Member] | Minimum [Member]
Estimated Useful Life	1 year
Rental Equipment [Member] | Maximum [Member]
Estimated Useful Life	3 years

Debt Obligations (Details Narra

Debt Obligations (Details Narrative) - USD ($)	Aug. 21, 2018	Jul. 31, 2018	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018	Dec. 31, 2018
Funded amount							$ 16,500,000
Number of option exercised
Common stock, par value			$ 0.001		$ 0.001		$ 0.001
Lump sum payment received					$ 6,000,000
Patent litigation settlement income			$ 6,000,000		$ 6,000,000
2018 Proceeds Investment Agreement [Member] | Brickell Key Investments LP [Member]
Funded amount		$ 10,000,000
Investment agreement description		The Company agreed to assign to BKI (i) 100% of all gross, pre-tax monetary recoveries paid by any defendant(s) to the Company or its affiliates agreed to in a settlement or awarded in judgment in connection with the patent assets, plus any interest paid in connection therewith by such defendant(s) (the "Patent Assets Proceeds"), up to the minimum return (as defined in the Agreement) and (ii) if BKI has not received its minimum return by the earlier of a liquidity event (as defined in the Agreement) and July 31, 2020, then the Company agreed to assign to BKI 100% of the Patent Asset Proceeds until BKI has received an amount equal to the minimum return on $4.0 million.
Payments of minimum return		$ 4,000,000
Indebtedness		$ 500,000
Warrant to purchase of common stock shares		465,712
Common stock, par value		$ 0.001
Exercise price		$ 2.60
Description of warrants reflecting agreement		An exercise price of $2.60 per share provided that the holder of the PIA Warrant will be prohibited from exercising the PIA Warrant if, as a result of such exercise, such holder, together with its affiliates, would own more than 4.99% of the total number of shares of the Company's common stock outstanding immediately after giving effect to such exercise. However, such holder may increase or decrease such percentage to any other percentage not in excess of 9.99%, provided that any increase in such percentage shall not be effective until 61 days after such notice to the Company.
Warrant term		5 years
2018 Proceeds Investment Agreement [Member] | Brickell Key Investments LP [Member] | First Tranche [Member]
Funded amount		$ 500,000
2018 Proceeds Investment Agreement [Member] | Brickell Key Investments LP [Member] | Second Tranche [Member]
Funded amount	$ 10,000,000	$ 9,500,000
Number of option exercised	9,500,000

Debt Obligations - Summary of S

Debt Obligations - Summary of Secured Convertible Debentures and Proceeds Investment Agreement (Details) - USD ($)	Jun. 30, 2019	Dec. 31, 2018
Debt Disclosure [Abstract]
2018 Proceeds Investment Agreement, at fair value	$ 6,240,000	$ 9,142,000
Less: Current portion
2018 Proceeds investment agreement at fair value-less current portion	$ 6,240,000	$ 9,142,000

Debt Obligations - Schedule of

Debt Obligations - Schedule of Fair Value of Embedded Derivatives and Warrants (Details) - USD ($)	6 Months Ended		12 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Dec. 31, 2016
Gross cash proceeds		$ 6,250,000	$ 4,000,000
2018 Proceeds Investment Agreement [Member]
Gross cash proceeds	10,000,000
Proceeds Investment Agreement [Member] | 2018 Proceeds Investment Agreement [Member]
Gross cash proceeds	9,067,513
Common Stock Purchase Warrants [Member] | 2018 Proceeds Investment Agreement [Member]
Gross cash proceeds	$ 932,487

Debt Obligations - Schedule o_2

Debt Obligations - Schedule of Fair Value of Debentures Activity (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Debt Disclosure [Abstract]
Proceeds investment agreement			$ 9,142,000
Repayment of obligation			(6,000,000)
Change in the fair value during the period	$ 2,961,000		3,098,000
Proceeds investment agreement	$ 6,240,000		$ 6,240,000

Fair Value Measurement - Financ

Fair Value Measurement - Financial Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($)	Jun. 30, 2019	Dec. 31, 2018
Proceeds Investment Agreement	$ 6,240,000	$ 9,142,000
Level 1 [Member]
Proceeds Investment Agreement
Level 2 [Member]
Proceeds Investment Agreement
Level 3 [Member]
Proceeds Investment Agreement	$ 6,240,000	$ 9,142,000

Fair Value Measurement - Fair V

Fair Value Measurement - Fair Value Measurements Change in Level 3 Inputs (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Fair Value Disclosures [Abstract]
Proceeds investment agreement			$ 9,142,000
Repayment of obligation			(6,000,000)
Change in fair value	$ (2,961,000)		(3,098,000)
Proceeds investment agreement	$ 6,240,000		$ 6,240,000

Accrued Expenses - Schedule of

Accrued Expenses - Schedule of Accrued Expenses (Details) - USD ($)	Jun. 30, 2019	Dec. 31, 2018
Payables and Accruals [Abstract]
Accrued warranty expense	$ 102,955	$ 195,135
Accrued litigation costs	363,508	1,119,445
Accrued sales commissions	26,553	25,750
Accrued payroll and related fringes	265,258	186,456
Accrued insurance	39,112	71,053
Accrued sales returns and allowances	28,714	13,674
Other	236,134	469,154
Total accrued expenses	$ 1,062,234	$ 2,080,667

Accrued Expenses - Schedule o_2

Accrued Expenses - Schedule of Accrued Warranty Expense (Details)	6 Months Ended
	Jun. 30, 2019USD ($)
Payables and Accruals [Abstract]
Beginning balance	$ 195,135
Provision for warranty expense	25,341
Charges applied to warranty reserve	(117,521)
Ending balance	$ 102,955

Income Taxes (Details Narrative

Income Taxes (Details Narrative)	6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018
Income Tax Disclosure [Abstract]
Effective tax rate valuation allowance on net deferred tax assets	100.00%	100.00%

Operating Lease (Details Narrat

Operating Lease (Details Narrative)	6 Months Ended
	Jun. 30, 2019USD ($)
Operating lease maturity date	Apr. 30, 2020
Weighted average remaining lease term	9 months 29 days
Operating lease expense	$ 198,861
Weighted average discount rate	8.00%
Minimum [Member]
Operating lease monthly payments	$ 38,026
Maximum [Member]
Operating lease monthly payments	$ 38,533

Operating Lease - Schedule of O

Operating Lease - Schedule of Operating Leases Right of Use Assets and Liabilities (Details) - USD ($)	Jun. 30, 2019	Dec. 31, 2018
Leases [Abstract]
Operating lease right of use assets	$ 276,338
Operating lease obligations-current portion	357,498
Operating lease obligations-less current portion
Operating lease obligations	$ 357,498

Operating Lease - Schedule of F

Operating Lease - Schedule of Future Minimum Lease Payments (Details) - USD ($)	Jun. 30, 2019	Dec. 31, 2018
Leases [Abstract]
2019 (period from July 1, 2019 to December 31, 2019)	$ 229,170
2020	154,131
Total undiscounted minimum future lease payments	383,301
Imputed interest	(25,803)
Present value of lease liabilities	$ 357,498

Contingencies (Details Narrativ

Contingencies (Details Narrative) - USD ($)	May 13, 2019	Jun. 01, 2018	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Matching contributions to 401 (k) plan			$ 26,968	$ 28,973	$ 53,410	$ 58,348
Advance commissions amount		$ 7,000
Commissions and consulting fees description		The parties have mutually agreed to further extend the arrangement on a monthly basis at $5,000 per month.
Consulting and Distributor Agreements [Member]
Payment of advances					277,151
Allowance reserve			129,140		129,140
Advance amount, net					148,011
Mutual Agreement [Member]
Payment of advances					96,242
Advance commissions amount			$ 6,000		6,000
Limited Liability Company [Member] | Consulting and Distributor Agreements [Member] | Minimum [Member]
Payments for commissions					5,000
Limited Liability Company [Member] | Consulting and Distributor Agreements [Member] | Maximum [Member]
Payments for commissions					$ 6,000
Employee Retirement Plan [Member]
Description of matching contributions to employees					The plan, as amended, requires us to provide 100% matching contributions for employees, who elect to contribute up to 3% of their compensation to the plan and 50% matching contributions for employee's elective deferrals on the next 2% of their contributions.
3% of Employee Contribution [Member]
Percentage of employer matching contribution					100.00%
2% of Employee Contribution [Member]
Percentage of employer matching contribution					50.00%
Employee Contribution [Member]
Percentage for vesting contributions					100.00%
Employer Contribution [Member]
Percentage for vesting contributions					100.00%
WatchGuard [Member]
One-time settlement payment	$ 6,000,000

Stock-Based Compensation (Detai

Stock-Based Compensation (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Stock based compensation	$ 585,195	$ 594,228	$ 1,310,393	$ 1,087,746
Number of common stock authorized to grant	3,425,000		3,425,000
Options, available for grant	626,316		626,316
Shares based compensation estimated fair value of risk free rate			2.23%
Share based compensation fair value of estimated term			5 years 6 months
Shares based compensation estimated fair value of volatility			108.00%
Stock options granted			436,217
Aggregate intrinsic value of options outstanding	$ 0		$ 0
Intrinsic value of options exercisable	0		0
Intrinsic value of options exercised
Unrecognized stock compensation expense	399,866		399,866
Non Vested Restricted Stock Grants [Member]
Unrecognized stock compensation expense	$ 976,035		$ 976,035
2005 Stock Option Plan [Member] | During 2015 [Member]
Number of common stock shares reserved for awards which unavailable for issuance	14,616		14,616
Unexercised and outstanding stock options	13,125		13,125
2006 Stock Option Plan [Member] | During 2016 [Member]
Number of common stock shares reserved for awards which unavailable for issuance	23,399		23,399
Unexercised and outstanding stock options	44,075		44,075
2007 Stock Option Plan [Member] | During 2017 [Member]
Number of common stock shares reserved for awards which unavailable for issuance	87,776		87,776
Unexercised and outstanding stock options	6,875		6,875
2008 Plan [Member] | During 2018 [Member]
Number of common stock shares reserved for awards which unavailable for issuance	8,249		8,249
Unexercised and outstanding stock options	32,250		32,250

Stock-Based Compensation - Summ

Stock-Based Compensation - Summary of Stock Options Outstanding (Details)	6 Months Ended
	Jun. 30, 2019$ / sharesshares
Options Granted	436,217
Options Exercised
Stock Options [Member]
Options Outstanding, Beginning balance	434,012
Options Granted	180,000
Options Exercised
Options Forfeited	(17,937)
Options Outstanding, Ending balance	596,075
Options Exercisable, Ending balance	416,075
Weighted Average Exercise Price, Outstanding, Beginning balance | $ / shares	$ 4.62
Weighted Average Exercise Price, Granted | $ / shares	3.01
Weighted Average Exercise Price, Exercised | $ / shares
Weighted Average Exercise Price, Forfeited | $ / shares	(12.43)
Weighted Average Exercise Price, Outstanding, Ending balance | $ / shares	3.90
Weighted Average Exercise Price, Exercisable, Ending balance | $ / shares	$ 4.28

Stock-Based Compensation - Shar

Stock-Based Compensation - Shares Authorized Under Stock Option Plans by Exercise Price Range (Details)	6 Months Ended
	Jun. 30, 2019$ / sharesshares
Number of options, outstanding	596,075
Weighted average remaining contractual life, outstanding options	7 years 8 months 12 days
Number of options, exercisable	416,075
Weighted average remaining contractual life, exercisable options	6 years 9 months 18 days
Exercise Price Range One [Member]
Exercise price range, lower limit | $ / shares	$ 0.01
Exercise price range, upper limit | $ / shares	$ 3.49
Number of options, outstanding	471,625
Weighted average remaining contractual life, outstanding options	8 years 10 months 25 days
Number of options, exercisable	291,625
Weighted average remaining contractual life, exercisable options	8 years 2 months 12 days
Exercise Price Range Two [Member]
Exercise price range, lower limit | $ / shares	$ 3.50
Exercise price range, upper limit | $ / shares	$ 4.99
Number of options, outstanding	67,625
Weighted average remaining contractual life, outstanding options	4 years 9 months 18 days
Number of options, exercisable	67,625
Weighted average remaining contractual life, exercisable options	4 years 9 months 18 days
Exercise Price Range Three [Member]
Exercise price range, lower limit | $ / shares	$ 5
Exercise price range, upper limit | $ / shares	$ 6.49
Number of options, outstanding
Weighted average remaining contractual life, outstanding options	0 years
Number of options, exercisable
Weighted average remaining contractual life, exercisable options	0 years
Exercise Price Range Four [Member]
Exercise price range, lower limit | $ / shares	$ 6.50
Exercise price range, upper limit | $ / shares	$ 7.99
Number of options, outstanding	8,875
Weighted average remaining contractual life, outstanding options	2 years 3 months 19 days
Number of options, exercisable	8,875
Weighted average remaining contractual life, exercisable options	2 years 3 months 19 days
Exercise Price Range Five [Member]
Exercise price range, lower limit | $ / shares	$ 8
Exercise price range, upper limit | $ / shares	$ 9.99
Number of options, outstanding	2,500
Weighted average remaining contractual life, outstanding options	1 year 10 months 25 days
Number of options, exercisable	2,500
Weighted average remaining contractual life, exercisable options	1 year 10 months 25 days
Exercise Price Range Six [Member]
Exercise price range, lower limit | $ / shares	$ 10
Exercise price range, upper limit | $ / shares	$ 19.99
Number of options, outstanding	39,825
Weighted average remaining contractual life, outstanding options	1 year 6 months
Number of options, exercisable	39,825
Weighted average remaining contractual life, exercisable options	1 year 6 months
Exercise Price Range Seven [Member]
Exercise price range, lower limit | $ / shares	$ 20
Exercise price range, upper limit | $ / shares	$ 24.99
Number of options, outstanding	5,625
Weighted average remaining contractual life, outstanding options	2 months 12 days
Number of options, exercisable	5,625
Weighted average remaining contractual life, exercisable options	2 months 12 days

Stock-Based Compensation - Su_2

Stock-Based Compensation - Summary of Restricted Stock Activity (Details) - Restricted Stock [Member]	6 Months Ended
	Jun. 30, 2019$ / sharesshares
Number of Restricted shares, Non-vested Beginning Balance | shares	772,150
Number of Restricted shares, Granted | shares	522,110
Number of Restricted shares, Vested | shares	(397,790)
Number of Restricted shares, Forfeited | shares	(2,500)
Number of Restricted shares, Non-vested Ending Balance | shares	893,970
Weighted average grant date fair value, Non-vested Beginning Balance | $ / shares	$ 3.40
Weighted average grant date fair value, Granted | $ / shares	2.91
Weighted average grant date fair value, Vested | $ / shares	(3.84)
Weighted average grant date fair value, Forfeited | $ / shares	(2.30)
Weighted average grant date fair value, Non-vested Ending Balance | $ / shares	$ 2.92

Stock-Based Compensation - Sche

Stock-Based Compensation - Schedule of Non-vested Balance of Restricted Stock (Details) - Restricted Stock [Member]	Jun. 30, 2019shares
Nonvested balance, 2019 (July 1, 2019 to December 31, 2019)	377,525
Nonvested balance, 2020	265,785
Nonvested balance, 2021	250,660

Common Stock Purchase Warrant_2

Common Stock Purchase Warrants (Details Narrative)	6 Months Ended
	Jun. 30, 2019USD ($)$ / sharesshares
Common Stock Purchase Warrants [Member]
Warrants to purchase common stock | shares	4,532,145
Warrant expiration term, description	July 15, 2020 through July 31, 2023
Warrants [Member]
Intrinsic value of all outstanding warrants | $	$ 0
Warrants, weighted average remaining term	28 months
Minimum [Member] | Common Stock Purchase Warrants [Member]
Warrant, exercise per share	$ 2.60
Maximum [Member] | Common Stock Purchase Warrants [Member]
Warrant, exercise per share	$ 16.50

Common Stock Purchase Warrant_3

Common Stock Purchase Warrants - Summary of Warrant Activity (Details) - Warrants [Member]	6 Months Ended
	Jun. 30, 2019$ / sharesshares
Warrants, Vested, Beginning balance | shares	4,693,145
Warrants, Granted | shares
Warrants, Exercised | shares	(529,000)
Warrants, Cancelled | shares
Warrants, Vested, Ending balance | shares	4,164,145
Weighted average exercise price, Vested, Beginning balance | $ / shares	$ 5.40
Weighted average exercise price, Granted | $ / shares
Weighted average exercise price, Exercised | $ / shares	(2.96)
Weighted average exercise price, Cancelled | $ / shares
Weighted average exercise price, Vested, Ending balance | $ / shares	$ 5.71

Common Stock Purchase Warrant_4

Common Stock Purchase Warrants - Summary of Range of Exercise Prices and Weighted Average Remaining Contractual Life of Warrants (Details) - Warrants [Member]	6 Months Ended
	Jun. 30, 2019$ / sharesshares
Outstanding and exercisable warrants, Weighted average remaining contractual life	2 years 10 months 25 days
Exercise Price Range One [Member]
Outstanding and exercisable warrants, Exercise price | $ / shares	$ 2.60
Outstanding and exercisable warrants, Number of warrants	465,712
Outstanding and exercisable warrants, Weighted average remaining contractual life	4 years 1 month 6 days
Exercise Price Range Two [Member]
Outstanding and exercisable warrants, Exercise price | $ / shares	$ 3
Outstanding and exercisable warrants, Number of warrants	701,667
Outstanding and exercisable warrants, Weighted average remaining contractual life	3 years 9 months 18 days
Exercise Price Range Three [Member]
Outstanding and exercisable warrants, Exercise price | $ / shares	$ 3.25
Outstanding and exercisable warrants, Number of warrants	120,000
Outstanding and exercisable warrants, Weighted average remaining contractual life	3 years 6 months
Exercise Price Range Four [Member]
Outstanding and exercisable warrants, Exercise price | $ / shares	$ 3.36
Outstanding and exercisable warrants, Number of warrants	880,000
Outstanding and exercisable warrants, Weighted average remaining contractual life	3 years 4 months 24 days
Exercise Price Range Five [Member]
Outstanding and exercisable warrants, Exercise price | $ / shares	$ 3.50
Outstanding and exercisable warrants, Number of warrants	18,000
Outstanding and exercisable warrants, Weighted average remaining contractual life	1 month 6 days
Exercise Price Range Six [Member]
Outstanding and exercisable warrants, Exercise price | $ / shares	$ 3.65
Outstanding and exercisable warrants, Number of warrants	200,000
Outstanding and exercisable warrants, Weighted average remaining contractual life	3 years
Exercise Price Range Seven [Member]
Outstanding and exercisable warrants, Exercise price | $ / shares	$ 3.75
Outstanding and exercisable warrants, Number of warrants	94,000
Outstanding and exercisable warrants, Weighted average remaining contractual life	3 years 1 month 6 days
Exercise Price Range Eight [Member]
Outstanding and exercisable warrants, Exercise price | $ / shares	$ 5
Outstanding and exercisable warrants, Number of warrants	800,000
Outstanding and exercisable warrants, Weighted average remaining contractual life	2 years 6 months
Exercise Price Range Nine [Member]
Outstanding and exercisable warrants, Exercise price | $ / shares	$ 13.43
Outstanding and exercisable warrants, Number of warrants	879,766
Outstanding and exercisable warrants, Weighted average remaining contractual life	1 year 6 months
Exercise Price Range Ten [Member]
Outstanding and exercisable warrants, Exercise price | $ / shares	$ 16.50
Outstanding and exercisable warrants, Number of warrants	5,000
Outstanding and exercisable warrants, Weighted average remaining contractual life	1 year
Outstanding and exercisable warrants, Number of warrants	4,164,145

Net Loss Per Share - Calculatio

Net Loss Per Share - Calculation of Weighted Average Number of Shares Outstanding and Loss Per Share Outstanding (Details) - USD ($)	3 Months Ended				6 Months Ended		12 Months Ended
	Jun. 30, 2019	Mar. 31, 2019	Jun. 30, 2018	Mar. 31, 2018	Jun. 30, 2019	Jun. 30, 2018	Dec. 31, 2018
Earnings Per Share [Abstract]
Numerator for basic and diluted income per share - Net loss	$ (387,730)	$ (3,205,174)	$ (2,962,890)	$ (2,588,232)	$ (3,592,904)	$ (5,551,122)	$ 15,500,000
Denominator for basic loss per share - weighted average shares outstanding	11,305,248		7,129,260		11,124,222	7,153,219
Dilutive effect of shares issuable under stock options and warrants outstanding
Denominator for diluted loss per share - adjusted weighted average shares outstanding	11,305,248		7,129,260		11,124,222	7,153,219
Net loss per share: Basic	$ (0.03)		$ (0.42)		$ (0.32)	$ (0.78)
Net loss per share: Diluted	$ (0.03)		$ (0.42)		$ (0.32)	$ (0.78)

Subsequent Events (Details Narr

Subsequent Events (Details Narrative) - USD ($)	Aug. 05, 2019	Jun. 30, 2019	Jun. 30, 2018
Debt conversion amount			$ 185,688
Subsequent Event [Member]
Warrants to purchase common stock	571,248
Subsequent Event [Member] | Securities Purchase Agreement [Member] | Investors [Member]
Proceeds from sale of securities	$ 2,500,000
Warrants term	5 years
Warrants to purchase common stock	571,428
Warrants exercise price	$ 1.8125
Issuance of common stock for aggregate purchase price of note, shares	89,285
Common stock percentage	5.00%
Issuance of common stock for aggregate purchase price of notes	$ 125,000
Aggregate purchase price of notes	$ 2,500,000
Subsequent Event [Member] | Securities Purchase Agreement [Member] | Investors [Member] | 8% Senior Secured Convertible Promissory Notes [Member]
Debt maturity date	Aug. 4, 2020
Debt conversion amount	$ 2,777,779
Debt converted into shares	1,984,127
Conversion price per share	$ 1.40
Principal face amount	$ 1,153,320
Subsequent Event [Member] | Securities Purchase Agreement [Member] | Investors [Member] | Other Notes [Member]
Principal face amount	$ 1,624,458