Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | 5-May-15 | Jun. 30, 2014 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | CREATIVE REALITIES, INC. | ||
Entity Central Index Key | 1356093 | ||
Document Type | 10-K | ||
Document Period End Date | 31-Dec-14 | ||
Amendment Flag | FALSE | ||
Document Fiscal Year Focus | 2014 | ||
Document Fiscal Period Focus | FY | ||
Current Fiscal Year End Date | -19 | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $4,720,081 | ||
Entity Common Stock Shares Outstanding | 46,217,968 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
CURRENT ASSETS | ||
Cash and cash equivalents | $573 | $108 |
Accounts receivable, net of allowance for doubtful accounts of $490 and $73, respectively | 3,463 | 2,354 |
Unbilled receivables | 359 | |
Work-in-process and inventories | 739 | 759 |
Prepaid expenses | 355 | 109 |
Total current assets | 5,489 | 3,330 |
Property and Equipment, net | 746 | 221 |
Intangibles, net | 4,834 | 120 |
Goodwill | 10,572 | 1,362 |
Security deposit | 84 | |
Other assets | 235 | |
TOTAL ASSETS | 21,876 | 5,117 |
CURRENT LIABILITIES | ||
Accounts payable | 3,554 | 1,938 |
Accrued expenses | 1,102 | 341 |
Deferred revenues | 1,977 | 1,809 |
Due to affiliate | 215 | |
Current portion of loans payable | 316 | |
Total current liabilities | 6,633 | 4,619 |
Warrant liability | 1,910 | |
Dividend payable | 112 | |
Other liabilities | 434 | 25 |
TOTAL LIABILITIES | 9,090 | 4,644 |
COMMITMENTS AND CONTINGENCIES | ||
Convertible preferred stock, net of discount (liquidation preference of $5,302) | 1,532 | |
SHAREHOLDERS' EQUITY | ||
Common stock, $.01 per value 200,000 shares authorized; 46,218 and 28,547 shares issued and outstanding | 462 | 285 |
Additional paid-in capital | 17,439 | 3,036 |
Accumulated deficit | -6,647 | -2,848 |
Total shareholders' equity | 11,254 | 473 |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $21,876 | $5,117 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, except Share data, unless otherwise specified | ||
Statement of Financial Position [Abstract] | ||
Allowance for accounts receivable | $490 | $73 |
Liquidation preference | $5,302 | |
Common stock, shares authorized | 200,000 | 200,000 |
Common stock, shares issued | 46,218,000 | 28,547,000 |
Common stock, shares outstanding | 46,218,000 | 28,547,000 |
Common stock, par value per share | $0.01 | $0.01 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 12 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Sales | ||
Hardware | $5,020 | $5,919 |
Services and other | 8,398 | 5,652 |
Total sales | 13,418 | 11,572 |
Cost of sales | ||
Hardware | 4,606 | 3,634 |
Services and other | 5,446 | 6,927 |
Total cost of sales (exclusive of depreciation and amortization shown separately below) | 10,052 | 10,561 |
Gross profit | 3,366 | 1,011 |
Operating expenses: | ||
Sales and marketing expenses | 1,179 | 906 |
Research and development expenses | 492 | |
General and administrative expenses | 5,765 | 2,624 |
Depreciation and amortization expense | 817 | 295 |
Total operating expenses | 8,253 | 3,825 |
Operating loss | -4,886 | -2,814 |
Other income (expenses): | ||
Interest expense | -32 | -33 |
Other income/expense | -8 | |
Change in fair value of warrant liability | 1,127 | |
Total other expense | 1,087 | -33 |
Net loss | -3,799 | -2,848 |
Deemed dividend on preferred stock | 1,215 | |
Net loss attributable to common shareholders | ($5,014) | ($2,848) |
Net loss per common share - basic and diluted | ||
Net loss | ($0.11) | ($0.10) |
Deemed dividend on preferred stock | ($0.03) | |
Net loss attributable to common shareholders | ($0.14) | ($0.10) |
Weighted average shares outstanding - basic and diluted | 34,986 | 28,547 |
Consolidated_Statements_of_Sha
Consolidated Statements of Shareholders' Equity (USD $) | Total | Common Stock | Additional paid in capital | Accumulated Deficit |
In Thousands, except Share data | ||||
Beginning Balance at Dec. 31, 2012 | ||||
Beginning Balance, shares at Dec. 31, 2012 | ||||
Creative Realities, LLC member's equity - retroactive application of merger | 2,005 | 285 | 1,720 | |
Creative Realities, LLC member's equity - retroactive application of merger, shares | 28,547,267 | |||
Contribution of due to parent company debt to equity | 1,316 | 1,316 | ||
Net loss for the year | -2,848 | -2,848 | ||
Ending Balance at Dec. 31, 2013 | 473 | 285 | 3,036 | -2,848 |
Ending Balance, shares at Dec. 31, 2013 | 28,547,267 | |||
Contribution of due to parent company debt to equity | 2,126 | 2,126 | ||
Issuance of common shares to reflect merger with Wireless Ronin Technologies, Inc | 10,775 | 171 | 10,604 | |
Issuance of common shares to reflect merger with Wireless Ronin Technologies, Inc, shares | 17,103,055 | |||
Issuance of warrants and options due to merger with Wireless Ronin Technologies, Inc. | 1,250 | 1,250 | ||
Beneficial conversion feature on issuance of convertible preferred stock | 1,103 | 1,103 | ||
Amortization of beneficial conversion feature | -1,103 | -1,103 | ||
Shares issued for services | 369 | 6 | 363 | |
Shares issued for services, shares | 567,646 | |||
Stock-based compensation | 60 | 60 | ||
Net loss for the year | -3,799 | -3,799 | ||
Ending Balance at Dec. 31, 2014 | $11,254 | $462 | $17,439 | ($6,647) |
Ending Balance, shares at Dec. 31, 2014 | 46,217,968 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Operating Activities: | ||
Net loss | ($3,799) | ($2,848) |
Adjustments to reconcile net loss to net cash used in operating activities | ||
Depreciation and amortization | 817 | 295 |
Stock-based compensation | 60 | |
Change in warrant liability | -1,127 | |
Allowance for doubtful accounts | 417 | |
Shares issued for services | 268 | |
Changes to operating assets and liabilities (net as of assets acquired and liabilities assumed in merger): | ||
Accounts receivable and unbilled revenues | 764 | 481 |
Inventories | 967 | 459 |
Prepaid expenses and other current assets | -413 | -674 |
Other assets | -74 | |
Accounts payable | -248 | 868 |
Deferred revenue | -245 | 1,516 |
Accrued expenses | -100 | |
Dividend payable | 112 | |
Other non-current liabilities | 409 | |
Net cash used in operating activities | -3,719 | -865 |
Investing activities | ||
Purchases of property and equipment | -266 | -76 |
Acquisition of Wireless Ronin Technologies, Inc and Broadcast International, net of cash acquired (including fees assumed in merger for transaction) | -1,710 | |
Net cash used in investing activities | -1,976 | -76 |
Financing activities | ||
Payments on bank borrowings | -316 | -283 |
Borrowings from affiliate | 1,911 | 1,316 |
Proceeds received from Preferred stock and warrants | 4,565 | |
Net cash provided by financing activities | 6,160 | 1,033 |
Increase in Cash and Cash Equivalents | 465 | 92 |
Cash and Cash Equivalents, beginning of year | 108 | 16 |
Cash and Cash Equivalents, end of year | $573 | $108 |
Nature_of_Operations_and_Summa
Nature of Operations and Summary of Significant Accounting Policies | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Nature of Operations and Summary of Significant Accounting Policies [Abstract] | |||||||||
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1: NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||||||||
Nature of the Company’s Business | |||||||||
Creative Realities, Inc. (the Company or we) is a Minnesota corporation that provides innovative shopper marketing and digital marketing technology and solutions to retail companies, individual retail brands, enterprises and organizations throughout the United States and North America and in certain international markets. We have expertise in a broad range of existing and emerging shopper and digital marketing technologies, as well as the related media management and distribution software platforms and networks, device management, product management, customized software service layers, systems, experiences, workflows, and integrated solutions. Our technology and solutions include: digital merchandising and omni-channel customer engagement systems; interactive digital shopping assistants, advisors and kiosks; other interactive marketing technologies such as mobile, social media, transactions, beaconing, and web-based media that enable our customers to transform how they engage with consumers; and dynamic digital signage. We believe we are the world’s leading interactive marketing technology company that focuses on the retail shopper experience – a “shopper marketing technology company.” In sum, we help retailers and brands use the latest technologies to create better shopping experiences. | |||||||||
Financing and Merger | |||||||||
On August 18, 2014, we entered into a Securities Purchase Agreement with institutional and accredited investors pursuant to which we offered and sold an aggregate of 5,190,000 shares of our Series A Convertible Preferred Stock at $1.00 per share, and issued five-year warrants to purchase an aggregate of 6,487,000 shares of common stock at a per-share price of $0.50 (subject to adjustment), in a private placement exempt from registration under the Securities Act of 1933. The financing effected by our sale of the preferred stock was a condition to the closing of a merger contemplated by June 26, 2014 Agreement and Plan of Merger we entered into Creative Realities, LLC and later amended on August 20, 2014 (such agreement, as amended, referred to simply as the “Creative Realities Merger Agreement”). | |||||||||
On August 20, 2014, we completed the merger contemplated by the Creative Realities Merger Agreement, thereby acquiring the business of Creative Realities, LLC. At the effective time of the merger and pursuant to the Creative Realities Merger Agreement, Slipstream Funding, LLC, a Delaware limited liability company and then the sole member of Creative Realities, received shares of our common stock equivalent to approximately 59.2% of common stock issued and outstanding immediately after the merger, together with a warrant to purchase an additional number of common shares equal to 1.5% of our common stock outstanding immediately after the merger. As a result of this merger transaction and a contemporaneous investment in our Series A Convertible Preferred Stock by an affiliate of Slipstream Funding, Slipstream Funding and its affiliates beneficially own 32,249,949 shares of common stock and warrants to purchase common stock, representing beneficial ownership (as calculated under applicable SEC rules) of approximately 45.8% of our common stock immediately after the merger transaction. | |||||||||
Creative Realities, LLC (Creative Realities) was the “accounting acquirer” in the merger transaction, while Wireless Ronin Technologies (the registrant) was the “legal acquirer,” and therefore the merger was accounted for as a reverse acquisition. Creative Realities, LLC was determined to be the accounting acquirer since its former shareholder has majority control of the common stock, is by far the largest shareholder, and has the majority members of the board of directors and of the executive officers. In accordance with reverse acquisition accounting, the historical financial statements of the registrant will become those of Creative Realities, with the financial results of Wireless Ronin Technologies included only beginning with the merger date. Creative Realities allocated the deemed purchase price consideration to the tangible and intangible assets acquired and liabilities assumed from Wireless Ronin Technologies, with the excess purchase price recorded as goodwill (see Note 2). Effective September 15, 2014, Wireless Ronin Technologies, Inc. changed its name to Creative Realities, Inc. | |||||||||
As used throughout this report, the “Company” generally refers to the registrant (Creative Realities, Inc., formerly known as Wireless Ronin Technologies, Inc.), unless the context otherwise indicates or requires. Use of the first person “we” refers to the Company or, if the context so requires, to the historical business of Creative Realities or the registrant itself, in each case prior to the consummation of the August 20, 2014 merger transaction. | |||||||||
Summary of Significant Accounting Policies | |||||||||
A summary of the significant accounting policies consistently applied in the preparation of the accompanying financial statements follows: | |||||||||
1. Principles of Consolidation | |||||||||
The consolidated financial statements include the accounts of Creative Realities, Inc. (f/k/a Wireless Ronin Technologies, Inc.), our wholly owned subsidiaries Creative Realities, LLC, Broadcast International, Inc., and Wireless Ronin Technologies Canada, Inc. All inter-company balances and transactions have been eliminated in consolidation, as applicable. | |||||||||
2. Foreign Currency | |||||||||
Our functional currency for its operations, including those in Canada, is the U.S. Dollar. Foreign exchange transaction gains and losses attributable to exchange rate movements related to transactions made in the local currency and on intercompany receivables and payables not deemed to be of a long-term investment nature are recorded in other income (expense). | |||||||||
3. Revenue Recognition | |||||||||
We recognize revenue primarily from these sources: | |||||||||
● | System hardware sales | ||||||||
● | Professional services | ||||||||
● | Software design and development services | ||||||||
● | Software and software license sales | ||||||||
● | Implementation services | ||||||||
● | Maintenance and support services | ||||||||
We recognize revenue in accordance with Accounting Standards Codification (“ASC”) 605-910, Accounting for Performance of Construction-Type and Certain Production-Type Contracts, ASC 605-10-599, Revenue Recognition, ASC 605-25, Accounting for Revenue Arrangements with Multiple Deliverables, and ASC subtopic 605-985, Revenue Recognition: Software (or ASC 605-35), with respect to all transactions involving the sale of software licenses. In the event of a multiple-element arrangement, we evaluate if each element represents a separate unit of accounting, taking into account all factors following the guidelines set forth in FASB ASC 605-985-25-5. We recognize revenue when (i) persuasive evidence of an arrangement exists; (ii) delivery has occurred, which is when product title transfers to the customer, or services have been rendered; (iii) customer payments are fixed or determinable and free of contingencies and significant uncertainties; and (iv) collection is reasonably assured. If it is determined that collection of a fee is not reasonably assured, we defer the revenue and recognize it at the time collection becomes reasonably assured, which is generally upon receipt of cash payment, revenues are reported on a gross basis. | |||||||||
Revenues for services are recognized when the underlying service is delivered or performed pursuant to the terms of each arrangement. When the fair value of an undelivered element cannot be determined, we defer revenue for the delivered elements until the undelivered elements are delivered. If an acceptance period is required, revenue is recognized upon the earlier of customer acceptance or the expiration of the acceptance period. Sales and use taxes are reported on a net basis, excluding them from sales and cost of sales. | |||||||||
Multiple-Element Arrangements — We enter into arrangements with customers that include a combination of software products, system hardware, maintenance and support, or installation and training services. We allocate the total arrangement fee among the various elements of the arrangement based on the relative fair value of each of the undelivered elements determined by vendor-specific objective evidence (VSOE). In software arrangements for which we do not have VSOE of fair value for all elements, revenue is deferred until the earlier of when VSOE is determined for the undelivered elements (residual method) or when all elements for which we do not have VSOE of fair value have been delivered. We have determined VSOE of fair value for each of its products and services. | |||||||||
The VSOE for maintenance and support services is based upon the renewal rate for continued service arrangements. The VSOE for installation and training services is established based upon pricing for the services. The VSOE for software and licenses is based on the normal pricing and discounting for the product when sold separately. | |||||||||
Each element of our multiple-element arrangements qualifies for separate accounting. Nevertheless, when a sale includes both software and maintenance, we defer revenue under the residual method of accounting. Under this method, the undelivered maintenance and support fees included in the price of software is amortized ratably over the period the services are provided. We defer maintenance and support fees based upon the customer’s renewal rate for these services. | |||||||||
System hardware sales | |||||||||
We recognize revenue on system hardware sales generally upon shipment of the product or customer acceptance depending upon contractual arrangements with the customer. Shipping charges billed to customers are included in sales and the related shipping costs are included in cost of sales. | |||||||||
Professional services | |||||||||
Included in services and other revenues is revenue derived primarily from consulting related to discovery and requirements definition processes, the design and development of various marketing experiences, and content development and management. The majority of professional services and accompanying agreements qualify for separate accounting. Professional services are bid either on a fixed-fee basis, time-and-materials basis or both. For time-and-materials contracts, we recognize revenue as services are performed. For fixed-fee contracts, we recognize revenue upon completion of specific contractual milestones, by using the percentage-of-completion method, or the completed contract method. | |||||||||
Software design and development services | |||||||||
Revenue from contracts for technology integration consulting services where we design/redesign, build and implement new or enhanced systems applications and related processes for clients are recognized on the percentage-of-completion method in accordance with FASB ASC 605-985-25-88 through 107. Percentage-of-completion accounting involves calculating the percentage of services provided during the reporting period compared to the total estimated services to be provided over the duration of the contract. Estimated revenues from applying the percentage-of-completion method include estimated incentives for which achievement of defined goals is deemed probable. Contract costs include all direct material, labor, subcontractors, certain indirect costs, such as indirect labor, equipment costs, supplies, tools and depreciation costs. Selling, general and administrative costs are charges to expense as incurred. This method is followed where reasonably dependable estimates of revenues and costs can be made. We measure progress for completion based on either the hours worked as a percentage of the total number of hours of the project or by delivery and customer acceptance of specific milestones as outlined per the terms of the agreement with the customer. Estimates of total contract revenue and costs are continuously monitored during the term of the contract, and recorded revenue and costs are subject to revision as the contract progresses. Such revisions may result in increases or decreases to revenue and income and are reflected in the financial statements in the periods in which they are first identified. If estimates indicate that a contract loss will occur, a loss provision is recorded in the period in which the loss first becomes probable and reasonably estimable. Contract losses are determined to be the amount by which the estimated direct and indirect costs of the contract exceed the estimated total revenue that will be generated by the contract and are included in cost of sales and classified in accrued expenses in the balance sheet. Our presentation of revenue recognized on a contract completion basis has been consistently applied for all periods presented. | |||||||||
Software and software license sales | |||||||||
We recognize revenue when a fixed fee order has been received and delivery has occurred to the customer. We assess whether the fee is fixed or determinable and free of contingencies based upon signed agreements received from the customer confirming terms of the transaction. Software is delivered to customers electronically or on a CD-ROM, and license files are delivered electronically. | |||||||||
Implementation services | |||||||||
We recognize implementation services revenue when an installation or deployment is completed. | |||||||||
Maintenance and support services | |||||||||
Maintenance and support consists of software updates and various forms of support services. Software updates provide customers with rights to unspecified software product upgrades and maintenance releases and patches released during the term of the support period. Support includes access to technical support personnel for software and hardware issues. We also offer a hosting service through our network operations center, or NOC, allowing the ability to monitor and support its customers’ networks 7 days a week, 24 hours a day. | |||||||||
Maintenance and support revenue is recognized ratably over the term of the contract, which is typically one to three years. Maintenance and support is renewable by the customer. Rates for maintenance and support, including subsequent renewal rates, are typically established based upon a fee per location, per device, or a specified percentage of net software license fees as set forth in the arrangement. We support agreement fees are based on the level of service provided to its customers, which can range from monitoring the health of a customer’s network to supporting a sophisticated web-portal to managing the end-to-end hardware and software of a digital marketing system. | |||||||||
Costs and estimated earnings recognized in excess of billings on uncompleted contracts are recorded as unbilled services and are included in work-in-process on the balance sheet. Billings in excess of costs and estimated earnings on uncompleted contracts are recorded as deferred revenue until revenue recognition criteria are met. Unbilled receivables are a normal part of our business as some receivables are invoiced in the month following shipment or completion of services. Our policy is to present any taxes imposed on revenue-producing transactions on a net basis. | |||||||||
4. Cash and Cash Equivalents | |||||||||
Cash equivalents consist of commercial paper and all other liquid investments with original maturities of three months or less when purchased. As of December 31, 2014, the Company had substantially all cash invested in a commercial paper sweep account. The Company maintains the majority of its cash balances in one financial institution located in Chicago. As of December 31, 2013, the Company had substantially all cash invested in a commercial bank account in New Jersey. The balances are insured by the Federal Deposit Insurance Corporation up to $250. | |||||||||
5. Accounts Receivable and Allowance for Doubtful Accounts | |||||||||
Our unsecured accounts receivable are customer obligations due under normal trade terms, carried at their face value less an allowance for doubtful accounts. We determine our allowance for doubtful accounts based on the evaluation of the aging of its accounts receivable and on a customer-by-customer analysis of its high-risk customers. Our reserves contemplate our historical loss rate on receivables, specific customer situations and the economic environments in which we operate. We determine past-due accounts receivable on a customer-by-customer basis. Accounts receivable are written off after all reasonable collection efforts have failed. | |||||||||
6. Work-In-Process and Inventories | |||||||||
Our work-in-process and inventories are recorded using the lower of cost or market on a first-in, first-out (FIFO) method. Inventory is net of an allowance for obsolescence of $22 and $245 as of December 31, 2014 and 2013, respectively. | |||||||||
7. Fair Value of Financial Instruments | |||||||||
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). Inputs are broadly defined as assumptions market participants would use in pricing an asset or liability. | |||||||||
FASB ASC 820-10, Fair Value Measurements and Disclosures, requires disclosure of the estimated fair value of an entity's financial instruments. Such disclosures, which pertain to our financial instruments, do not purport to represent our aggregate net fair value. The carrying value of cash and cash equivalents, accounts receivable, accounts payable, and accrued liabilities approximate fair value because of the short maturity of those instruments. The fair value of the loan payable approximates carrying value based on the interest rates in the agreement compared to current market interest rates. The fair value of the warrant liabilities is calculated using a black scholes model which approximates a binomial model. See Note 11 for more information. | |||||||||
8. Impairment of Long-Lived Assets | |||||||||
We review the carrying value of all long-lived assets, including property and equipment, for impairment in accordance with “FASB ASC 360-10-05-4,” Accounting for the Impairment or Disposal of Long-Lived Assets. Under FASB ASC 360-10-05-4, impairment losses are recorded whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable. | |||||||||
If the impairment tests indicate that the carrying value of the asset is greater than the expected undiscounted cash flows to be generated by such asset, an impairment loss would be recognized. The impairment loss is determined by the amount by which the carrying value of such asset exceeds its fair value. We generally measure fair value by considering sale prices for similar assets or by discounting estimated future cash flows from such assets using an appropriate discount rate. Assets to be disposed of are carried at the lower of their carrying value or fair value less costs to sell. Considerable management judgment is necessary to estimate the fair value of assets, and accordingly, actual results could vary significantly from such estimates. There were no impairment losses for long-lived assets recorded for the years ended December 31, 2014 and 2013. | |||||||||
9. Property and Equipment | |||||||||
Property and equipment are carried at cost, less accumulated depreciation and amortization. Depreciation is provided for in amounts sufficient to relate the cost of depreciable assets to operations over the estimated service lives, principally using straight-line methods. Leasehold improvements are amortized over the shorter of the life of the improvement or the lease term, using the straight-line method. | |||||||||
The estimated useful lives used to compute depreciation and amortization are as follows: | |||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Equipment | $ | 1,596 | $ | 1,163 | |||||
Leasehold improvements | 1,015 | 396 | |||||||
Purchased software | 242 | - | |||||||
Furniture and fixtures | 288 | 209 | |||||||
Other depreciables | 27 | - | |||||||
Total property and equipment | 3,169 | 1,768 | |||||||
Less: accumulated depreciation and amortization | (2,423 | ) | (1,547 | ) | |||||
Net property and equipment | $ | 746 | $ | 221 | |||||
Equipment | 3 – 5 years | ||||||||
Demonstration equipment | 3 – 5 years | ||||||||
Furniture and fixtures | 7 years | ||||||||
Purchased software | 3 years | ||||||||
Leased equipment | 3 years | ||||||||
Leasehold improvements | Shorter of 5 years or term of lease | ||||||||
Depreciation expense was $251 and $175 for the years ended December 31, 2014 and 2013, respectively. | |||||||||
10. Research and Development and Software Development Costs | |||||||||
Research and development expenses consist primarily of development personnel and non-employee contractor costs related to the development of new products and services, enhancement of existing products and services, quality assurance and testing. FASB ASC 985-20-25, Accounting for the Costs of Computer Software to Be Sold, Leased, or Otherwise Marketed, requires certain software development costs to be capitalized upon the establishment of technological feasibility. The establishment of technological feasibility and the ongoing assessment of the recoverability of these costs require considerable judgment by management with respect to certain external factors such as anticipated future revenue, estimated economic life, and changes in software and hardware technologies. Software development costs incurred beyond the establishment of technological feasibility have not been significant. No software development costs were capitalized during the years ended December 31, 2014 and 2013. Software development costs have been recorded as research and development expense for the years ended December 31, 2014 and 2013. We incurred research and development expenses of $492 and $0 during the years ended December 31, 2014 and 2013, respectively. | |||||||||
11. Basic and Diluted Loss per Common Share | |||||||||
Basic and diluted loss per common share for all periods presented is computed using the weighted average number of common shares outstanding by adding Creative Realities, LLC weighted average number of basic shares outstanding for that period, determined by applying the conversion ratio from the merger to the outstanding shares of Creative, plus the number of Creative shares deemed issued to CRI stockholders as a result of the merger. Basic weighted average shares outstanding include only outstanding common shares. Diluted net loss per common share is computed by dividing net loss by the weighted average common and potential dilutive common shares outstanding computed in accordance with the treasury stock method. Shares reserved for outstanding stock options and warrants totaling approximately 17.3 million at December 31, 2014 were excluded from the computation of loss per share as well as the potential common shares issuable upon conversion of convertible preferred stock as their effect was antidilutive due to our net loss. Net loss attributable to common shareholders for the year ended December 31, 2014 is after dividends on convertible preferred stock of $112 and amortization of the beneficial conversion feature of $1,103. | |||||||||
12. Deferred Income Taxes | |||||||||
The calculation of our income tax provision involves dealing with uncertainties in the application of complex tax regulations. We recognize tax liabilities for uncertain income tax positions based on management’s estimate of whether it is more likely than not that additional taxes will be required. We had no uncertain tax positions as of December 31, 2014 and 2013. Deferred income taxes are recognized in the financial statements for the tax consequences in future years of differences between the tax basis of assets and liabilities and their financial reporting amounts based on enacted tax laws and statutory tax rates. Temporary differences arise from net operating losses, differences in basis of intangibles (other than goodwill), stock-based compensation, reserves for uncollectible accounts receivable and inventory, differences in depreciation methods, and accrued expenses. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. | |||||||||
Our federal and state tax returns are potentially open to examinations for all years since 2011. As of December 31, 2014, we are not under any income tax audits by tax authorities. With few exceptions, we are no longer subject to U.S. federal, state or local income tax examinations by tax authorities for the years before 2011 and are not currently under examination by any taxing jurisdiction. In the event of any future tax assessments, we have elected to record the income taxes and any related interest and penalties as income tax expense on our statement of operations. | |||||||||
Until the merger date, Creative Realities, LLC was taxed as a limited liability company and, as such, any profit or loss from our operations flowed directly to the member who was then responsible to pay any federal or state income tax. We were only responsible for paying any minimum business and filing income tax costs. The Company has not included any pro forma income tax information as if the Company were a tax paying entity for the years ended December 31, 2014 and 2013, as any pro forma tax benefit on the losses before income taxes would be offset by a valuation allowance for the related deferred tax asset as it would be more likely than not that the future tax benefits will not be realized. | |||||||||
13. Accounting for Stock-Based Compensation | |||||||||
The Company accounts for stock-based compensation in accordance with FASB ASC 718-10 that requires the measurement and recognition of compensation expense for all stock-based payments including warrants, stock options, restricted stock grants and stock bonuses based on estimated fair value. For purposes of determining estimated fair value under FASB ASC 718-10-30, the Company computes the estimated fair values of stock options using the Black-Scholes option pricing model. Stock-based compensation expense of $60 and $0 was charged to expense during the years ended December 31, 2014 and 2013, respectively. | |||||||||
14. Goodwill and Indefinite-Lived Intangible Assets | |||||||||
We follow the provisions of ASC 350, Goodwill and Other Intangible Assets. Pursuant to ASC 350, goodwill acquired in a purchase business combination and is not amortized, but instead tested for impairment at least annually using a measurement date of September 30 (see Note 5). No impairment expense was recorded during the years ended December 31, 2014 and 2013. | |||||||||
15. Use of Estimates | |||||||||
The preparation of financial statements in conformity with U.S. generally accepted accounting principles 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 amounts of revenues and expenses during the reporting periods. Our significant estimates are the allowance for doubtful accounts, recognition of revenue under fixed price contracts, deferred tax assets, deferred revenue, depreciable lives and methods of property and equipment, valuation of warrants and other stock-based compensation. Actual results could differ from those estimates. | |||||||||
16. Change in authorized shares | |||||||||
On October 15, 2014, the Company filed articles of amendment to articles of incorporation to change the authorized common shares from 50,000,000 to 200,000,000 and preferred shares from 16,666,666 to 50,000,000, which were approved by the shareholders. Form 8-K filed with the Securities and Exchange Commission on October 16, 2014 reflects this change. | |||||||||
17. Recently Issued Accounting Pronouncements | |||||||||
In April 2014, the FASB issued ASU No. 2014-08 "Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of Equity", which amends the definition of a discontinued operation in Accounting Standards Codification, or ASC, 205-20 and requires entities to provide additional disclosures about discontinued operations as well as disposal transactions that do not meet the discontinued operations criteria. The new guidance changes the definition of a discontinued operation and requires discontinued operations treatment for disposals of a component or group of components that represents a strategic shift that has or will have a major impact on an entity's operations or financial results. The ASU is effective prospectively for all disposals (except disposals classified as held for sale before the adoption date) or components initially classified as held for sale in periods beginning on or after December 15, 2014; earlier adoption is permitted. The adoption of this guidance affects prospective presentation of disposals and therefore, is not expected to have a material impact on the Company's consolidated financial condition, results of operations or cash flows. | |||||||||
In May 2014, the Financial Accounting Standards Board (FASB) issued guidance creating Accounting Standards Codification ("ASC") Section 606, "Revenue from Contracts with Customers". The new section will replace Section 605, "Revenue Recognition" and creates modifications to various other revenue accounting standards for specialized transactions and industries. The section is intended to conform revenue accounting principles with a concurrently issued International Financial Reporting Standards with previously differing treatment between United States practice and those of much of the rest of the world, as well as, to enhance disclosures related to disaggregated revenue information. The updated guidance is effective for annual reporting periods beginning on or after December 15, 2016, and interim periods within those annual periods. The Company will adopt the new provisions of this accounting standard at the beginning of fiscal year 2017, given that early adoption is not an option. The Company will further study the implications of this statement in order to evaluate the expected impact on its financial statements. | |||||||||
18. Reclassifications | |||||||||
Certain reclassifications were made to the 2013 consolidated financial statements to conform to the 2014 presentation with no effect on net loss on shareholders’ equity. |
Creative_Realities_LLC_Merger
Creative Realities, LLC Merger | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Creative Realities, LLC Merger [Abstract] | |||||||||
CREATIVE REALITIES, LLC MERGER | NOTE 2: CREATIVE REALITIES, LLC MERGER | ||||||||
On August 20, 2014, we completed the merger contemplated by the Creative Realities Merger Agreement, thereby acquiring the business of Creative Realities, LLC. At the effective time of the merger and pursuant to the Creative Realities Merger Agreement, Slipstream Funding, LLC, then the sole member of Creative Realities, received shares of our common stock equivalent to approximately 59.2% of the common stock issued and outstanding immediately after the merger, together with a warrant to purchase an additional number of common shares equal to 1.5% of our common stock outstanding immediately after the merger. As a result of this merger transaction and a contemporaneous investment in our Series A Convertible Preferred Stock by an affiliate of Slipstream Funding, Slipstream Funding and its affiliates beneficially own 32,249,919 shares of common stock and warrants to purchase common stock, representing beneficial ownership (as calculated under applicable SEC rules) of approximately 45.8% of our common stock issued and outstanding immediately after the merger. | |||||||||
Creative Realities, LLC was the “accounting acquirer” in the merger transaction while the registrant was the “legal acquirer,” and therefore the merger was accounted for as a reverse acquisition. In accordance with reverse acquisition accounting, the historical financial statements of the registrant will be those of Creative Realities with the financial results of Wireless Ronin Technologies included only beginning with the merger date. We allocated the purchase price consideration to the identifiable tangible and intangible assets acquired and liabilities assumed from Wireless Ronin Technologies, with the excess purchase price recorded as goodwill. Effective September 15, 2014, the Wireless Ronin Technologies, Inc. (the registrant) changed its name to Creative Realities, Inc. | |||||||||
Under reverse acquisition accounting, as the accounting acquirer, Creative Realities is deemed (for accounting purposes only) to have issued to the registrant’s shareholders approximately 17.1 million shares with an aggregate value at the merger date of $10.8 million based on the August 20, 2014 market price of its common shares of $0.63. Creative Realities is also deemed to have issued replacement options to the registrant’s option holders and replacement warrants to the registrant’s warrant holders. The estimated fair value of the registrant’s warrants and the value of the vested stock options of the registrant, all of which were deemed to have vested in connection with a change of control as of the effective date of the transaction on August 20, 2014, aggregating $1.4 million, were included as purchase price consideration, plus the assumption of liabilities in excess of assets acquired making the total purchase consideration $13.7 million. | |||||||||
The following is a preliminary estimate of the merger consideration to be transferred to effect the merger: | |||||||||
(in thousands) | |||||||||
Deemed (for accounting purposes only) issuance of shares to CRI, Inc. shareholders | $ | 10,775 | |||||||
Deemed (for accounting purposes only) issuance of warrants to CRI, Inc. shareholders | 754 | ||||||||
Deemed (for accounting purposes only) issuance of stock options to CRI, Inc. shareholders | 602 | ||||||||
Assumption of liabilities in excess of assets acquired | 1,588 | ||||||||
Total consideration | $ | 13,719 | |||||||
The deemed issuance of warrants and stock options represent the fair value of those warrants and stock options based on the Black-Scholes valuation model, using the CRI, Inc. share price on the merger date as an input. | |||||||||
The following assumptions were applied in determining the fair value of deemed (for accounting purposes only) conversion of CRI, Inc. warrants and stock options awards: | |||||||||
Risk-free interest rate | 0.49%-2.09% | ||||||||
Expected term | 1.3-7.0 years | ||||||||
Expected price volatility | 98%-143% | ||||||||
Dividend yield | - | ||||||||
Our computation of expected volatility is based on historical volatility. The expected option term was calculated using the simplified method, an average of the contractual term and vesting period. The risk free interest rate of the award is based on the U.S. Treasury yield curve in effect at the time of the merger and having a term consistent with the expected term of the award. | |||||||||
Under the acquisition method of accounting, the total purchase price is allocated to the identifiable tangible and intangible assets of Wireless Ronin Technologies, Inc. deemed to have been acquired in the merger, based on their fair values at the merger date. The estimated fair values are based on the information that was available as of the merger date. We believe that the information provides a reasonable basis for estimating the fair values. The allocation of the purchase price to assets acquired and liabilities assumed is as follows (in thousands): | |||||||||
(in thousands) | |||||||||
Current assets | $ | 1,901 | |||||||
Property and equipment | 167 | ||||||||
Goodwill | 9,210 | ||||||||
Other intangible assets | 5,164 | ||||||||
Other assets | 77 | ||||||||
Total assets | 16,519 | ||||||||
Current liabilities | 2,800 | ||||||||
Total liabilities | 2,800 | ||||||||
Estimated purchase price | $ | 13,719 | |||||||
The estimated fair value of amortizable intangible assets of $5.2 million is amortized on a straight-line basis over the weighted average estimated useful life of 3.9 years. The purchase price allocation to identifiable intangible assets and related amortization lives are as follows: | |||||||||
Useful lives | |||||||||
(in thousands) | Amounts | (years) | |||||||
Technology platform - Broadcast | $ | 260 | 5 | ||||||
Technology platform - Wireless Ronin | 3,930 | 4 | |||||||
Customer relationships | 1,090 | 3 | |||||||
Total | $ | 5,280 | |||||||
The fair values of the technology platforms and the customer relationship were estimated using a discounted present value income approach. Under the income approach, an intangible asset’s fair value is equal to the present value of future economic benefits to be derived from ownership of the asset. Indications of value are developed by discounting future net cash flows to their present value at market-based rates of return. The useful life of the intangible assets for amortization purposes was determined considering the period of expected cash flows used to measure the fair value of the intangible assets adjusted as appropriate for the entity-specific factors including legal, regulatory, contractual, competitive, economic or other factors that may limit the useful life of intangible assets. | |||||||||
In addition, deferred revenue was reduced by approximately $0.3 million to the fair value of the cost of fulfillment plus a normal profit on that effort. We also established an accrual for rent of $0.2 million, related to the above market lease rate on the Minnetonka facility. This accrual will be amortized over the remaining lease term through December 31, 2018. | |||||||||
The goodwill recognized as a result of the merger is attributable primarily to the strategic and synergistic opportunities across the marketing technology spectrum, expected corporate synergies and the assembled workforce. The goodwill recognized is expected to be deductible for income tax purposes. | |||||||||
We incurred approximately $0.2 million of CRI, Inc.’s acquisition-related costs which were expensed during the year ended December 31, 2014. These costs are included in selling, general and administrative costs in our consolidated statements of operations. | |||||||||
The actual parent net sales and net loss (i.e., net sales relating to the business conducted by the registrant, as Wireless Ronin Technologies, Inc. and Broadcast International, Inc., prior to the August 20, 2014 merger with Creative Realities) included in the below unaudited pro forma consolidated statements of operations are not indicative of the results to be expected for a full year) and the supplemental unaudited pro forma net sales and net loss of the combined entity had the acquisition been completed on January 1, 2013 is as follows: | |||||||||
Years ended | |||||||||
(Unaudited) | December 31, | ||||||||
2014 | 2013 | ||||||||
Supplemental pro forma combined results of operations: | |||||||||
Net sales | $ | 15,098 | $ | 21,415 | |||||
Net loss | (6,362 | ) | (11,682 | ) | |||||
The pro forma financial information includes amortization expense from the acquired assets and transaction costs added back for the year ended December 31, 2013. | |||||||||
These unaudited pro forma condensed consolidated financial results have been prepared for illustrative purposes only and do not purport to be indicative of the results of operations that actually would have resulted had the acquisition occurred on the first day of the earliest period presented, or of future results of the consolidated entities. The unaudited pro forma condensed consolidated financial information does not reflect any operating efficiencies and cost savings that may be realized from the integration of the acquisition. | |||||||||
Broadcast International, Inc. (Broadcast) is a provider of managed video solutions, including digital signage, OTT (Over the Top) networks, IPTV, and live/on-demand content distribution for the enterprise. On August 1, 2014 (the Broadcast Merger Date), Wireless Ronin Technologies (“WRT”) acquired 100% of the outstanding shares of Broadcast by issuing 7.1 million shares of WRT common stock with an aggregate value at the Broadcast merger date of $3.6 million based on the price of WRT shares on the merger date. The former Broadcast shareholders owned approximately 36.5% of the WRT common stock outstanding immediately after the Broadcast merger, calculated on a modified fully diluted basis. As the acquirer, WRT allocated the purchase price consideration to the tangible and intangible assets acquired and liabilities assumed from Broadcast, with excess purchase price recorded as goodwill. Those allocations to Broadcast assets and liabilities were superseded by the purchase price allocation from the August 20, 2014 merger transaction with Creative Realities that occurred after the Broadcast merger. |
Fair_Value_Measurement
Fair Value Measurement | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Fair Value Measurement [Abstract] | |||||||||||||||||
FAIR VALUE MEASUREMENT | NOTE 3: FAIR VALUE MEASUREMENT | ||||||||||||||||
We measure certain financial assets, including cash equivalents, at fair value on a recurring basis. In accordance with FASB ASC 820-10-30, fair value is a market-based measurement that should be determined based on the assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, FASB ASC 820-10-35 establishes a three-level hierarchy that prioritizes the inputs used in measuring fair value. The three hierarchy levels are defined as follows: | |||||||||||||||||
Level 1 — Valuations based on unadjusted quoted prices in active markets for identical assets. | |||||||||||||||||
Level 2 — Valuations based on observable inputs (other than Level 1 prices), such as quoted prices for similar assets at the measurement date; quoted prices in markets that are not active; or other inputs that are observable, either directly or indirectly. | |||||||||||||||||
Level 3 — Valuations based on inputs that are unobservable and involve management judgment and the reporting entity’s own assumptions about market participants and pricing. | |||||||||||||||||
The following table presents information about the Company's warrant liabilities that are measured at fair value on a recurring basis and indicates the fair value hierarchy of the valuation techniques the Company used to determine such fair value. In general, fair values determined by Level 1 inputs use quoted prices (unadjusted) in active markets for identical assets or liabilities. Fair values determined by Level 2 inputs use data points that are observable such as quoted prices, interest rates and yield curves. Fair values determined by Level 3 inputs are unobservable data points for the asset or liability, and includes situations where there is little, if any, market activity for the asset or liability: | |||||||||||||||||
Description | Fair Value | Quote Prices In Active Markets (Level 1) | Significant Other Observable Inputs | Significant Other Unobservable inputs | |||||||||||||
(Level 2) | (Level 3) | ||||||||||||||||
Warrant Liabilities | 1,910 | - | - | 1,910 | |||||||||||||
The change in level 3 fair value is as follows: | |||||||||||||||||
Record warrant liability in August 2014 | $ | 3,037 | |||||||||||||||
Decrease in fair value of warrant liability | (1,127 | ) | |||||||||||||||
Ending warrant liability as of December 31, 2014 | $ | 1,910 |
Other_Financial_Statement_Info
Other Financial Statement Information | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Other Financial Statement Information [Abstract] | |||||||||
OTHER FINANCIAL STATEMENT INFORMATION | NOTE 4: OTHER FINANCIAL STATEMENT INFORMATION | ||||||||
The following table provides details of selected financial statement items: | |||||||||
Inventories | |||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Finished goods | $ | 531 | $ | 82 | |||||
Work-in-process | 208 | 677 | |||||||
Total inventories | $ | 739 | $ | 759 | |||||
Supplemental Cash Flow Information: | |||||||||
Cash paid for Interest | 18 | 33 | |||||||
Cash paid for taxes | - | - | |||||||
Non-cash conversion of borrowings from affiliate to equity | 2,126 | 1,316 | |||||||
Leasehold improvements paid for by landlord allowance | 344 | - | |||||||
Goodwill_and_Other_Intangible_
Goodwill and Other Intangible Assets | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Goodwill and Other Intangible Assets [Abstract] | |||||||||||||||||
GOODWILL AND OTHER INTANGIBLE ASSETS | NOTE 5: GOODWILL AND OTHER INTANGIBLE ASSETS | ||||||||||||||||
Goodwill | |||||||||||||||||
Changes in goodwill for the period from January 1, 2013 to December 31, 2014 are as follows (in millions): | |||||||||||||||||
Goodwill at December 31, 2012 | $ | 1,362 | |||||||||||||||
Change in 2013 | - | ||||||||||||||||
Merger of Creative and WRT (note 2) | 9,210 | ||||||||||||||||
Goodwill at December 31, 2014 | $ | 10,572 | |||||||||||||||
Other Intangible Assets | |||||||||||||||||
Other intangible assets consisted of the following at December 31, 2014 and 2013 (in thousands): | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Gross | Gross | ||||||||||||||||
Carrying | Accumulated | Carrying | Accumulated | ||||||||||||||
Amount | Amortization | Amount | Amortization | ||||||||||||||
Technology platform | $ | 4,190 | $ | 374 | $ | - | $ | - | |||||||||
Customer relationships | 1,090 | 131 | - | - | |||||||||||||
Trademarks and trade names | 300 | 240 | 300 | 180 | |||||||||||||
5,580 | $ | 745 | 300 | $ | 180 | ||||||||||||
Accumulated amortization | 746 | 180 | |||||||||||||||
Net book value of amortizable intangible assets | $ | 4,834 | $ | 120 | |||||||||||||
For the years ended December 31, 2014 and 2013, amortization of intangible assets charged to operations was $566 and $60, respectively. | |||||||||||||||||
Estimated amortization is as follows: | |||||||||||||||||
Year ending December 31, | |||||||||||||||||
2015 | $ | 1,460 | |||||||||||||||
2016 | 1,400 | ||||||||||||||||
2017 | 1,268 | ||||||||||||||||
2018 | 681 | ||||||||||||||||
2019 | 35 | ||||||||||||||||
In accordance with ASC 350, we test for goodwill impairment annually on September 30 or more frequently if changes in circumstances or the occurrence of events suggests an impairment may exist. Determining the fair value of a reporting unit under the first step of the goodwill impairment test and determining the fair value of individual assets and liabilities of a reporting unit (including unrecognized intangible assets) under the second step of the goodwill impairment test is judgmental in nature and often involves the use of significant estimates and assumptions. Similarly, estimates and assumptions are used in determining the fair value of other intangible assets. We estimated the fair value in relation to the trading price of the Company’s common stock. | |||||||||||||||||
This approach uses significant estimates and assumptions. These estimates and assumptions could have a significant impact on whether or not an impairment charge is recognized and also the magnitude of any such charge. As a result of its annual impairment analysis at September 30, there was no impairment expense for the year ended December 31, 2014. No event occured during the 4th quarter 2014 that would be considered a triggering event for the Company to cause the Company to review for possible impairment. | |||||||||||||||||
Loans_Payable
Loans Payable | 12 Months Ended |
Dec. 31, 2014 | |
Loans Payable [Abstract] | |
LOANS PAYABLE | NOTE 6: LOANS PAYABLE |
We had a note payable to JPMorgan Chase Bank, N.A. which was paid in full on October 1, 2014. The balance of the note payable was $316 at December 31, 2013. The interest rate was 5.25% at December 31, 2013. The loan was secured by all of the assets of the Company. The loan was repaid in full in October 2014. |
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Commitments and Contingencies [Abstract] | |||||
COMMITMENTS AND CONTINGENCIES | NOTE 7: COMMITMENTS AND CONTINGENCIES | ||||
Leases | |||||
Future minimum lease payments under leases with initial or remaining non-cancelable lease terms in excess of one year as of December 31, 2014 are as follows: | |||||
Year ending December 31, | Lease Obligations | ||||
2015 | $ | 658 | |||
2016 | 669 | ||||
2017 | 663 | ||||
2018 | 495 | ||||
2019 | 472 | ||||
Total future minimum obligations | 195 | ||||
$ | 3,154 | ||||
Rent expense totaled $690 and $413 for the years ended December 31, 2014 and 2013, respectively, and is included in General and Administrative expenses. | |||||
Effective November 2014, the Company has sublet approximately 9,000 sq. ft of space at its Minnetonka, MN office at an annual rate of $11 per square foot subject to annual increases of 2.5%. Because the rental rate was above market at the time of the merger, the Company recorded an adjustment of $180 to reduce the expense to market over the remaining term of the lease. | |||||
Litigation | |||||
In August 2014, we initiated a breach-of-contract lawsuit against a customer and certain parties related to that customer for failure to pay. The defendants have answered and asserted counterclaims. In the event we are unable to reach a negotiated settlement with the defendants, we intend to vigorously litigate our claims and contest the defendants’ counterclaims. At this time, we do not believe the litigation matter is likely to have a material and adverse impact on the Company. |
Restructuring
Restructuring | 12 Months Ended |
Dec. 31, 2014 | |
Restructuring [Abstract] | |
RESTRUCTURING | NOTE 8: RESTRUCTURING |
During the three months ended September 30, 2014, we took restructuring actions to lower our cost structure by reducing our headcount. We incurred restructuring expenses for termination costs, $582 of which were including in selling, general and administrative expenses on the statement of operations. As of December 31, 2014, $137 of the accrued expense has been paid. |
Related_Party_Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2014 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 9: RELATED PARTY TRANSACTIONS |
On July 31, 2014, our then-parent entity and sole member converted an obligation we owed to that parent into $2.125 million of member’s equity. On December 31, 2013, our then-parent entity converted an obligation we owed to that parent into $1,316 million of member’s equity |
Income_Taxes
Income Taxes | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Income Taxes [Abstract] | |||||
INCOME TAXES | NOTE 10: INCOME TAXES | ||||
Our deferred tax assets are primarily related to net operating loss carryforwards (NOLs). We have substantial NOLs that are limited by IRS Section 382 due to change in control. IRS Section 382 generally imposes an annual limitation on the amount of NOLs that may be used to offset taxable income when a corporation has undergone significant changes in stock ownership. We have performed a preliminary analysis of the annual NOL carryforwards that are available to be used against taxable income. The estimated NOL carryforward for federal purposes is $10.2 million and foreign NOL carryforward is $5.1 million. | |||||
A summary of the deferred tax assets and liabilities is included below: | |||||
December 31, | |||||
2014 | |||||
Deferred tax assets (liabilities): | |||||
Reserves | $ | (72 | ) | ||
Property and equipment | (4 | ) | |||
Accrued expenses | 781 | ||||
Severance | 178 | ||||
Non-qualified stock options | 419 | ||||
Net foreign carryforwards | 1,349 | ||||
Net operating loss and credit carryforwards | 5,592 | ||||
Intangibles | 57 | ||||
Total Deferred Tax Assets (includes $7,255 recorded upon merger - Note 2) | 8,300 | ||||
Valuation Allowance (includes $97,255 recorded upon merger - Note 2) | (8,300 | ) | |||
Net deferred tax assets (liabilities) | $ | - | |||
Year ended December 31, | |||||
2014 | |||||
Tax Provision Summary | |||||
Deferred Provision (Benefit) - Federal | $ | (987 | ) | ||
Deferred Provision (Benefit) - State | (58 | ) | |||
Deferred Provision (Benefit) - Foreign | - | ||||
Change in valuation allowance | 1,045 | ||||
Tax Expense | $ | 0 |
Convertible_Preferred_Stock_an
Convertible Preferred Stock and Warrants | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
Convertible Preferred Stock and Warrants [Abstract] | |||||||||||||||||||||||||
CONVERTIBLE PREFERRED STOCK AND WARRANTS | NOTE 11: CONVERTIBLE PREFERRED STOCK AND WARRANTS | ||||||||||||||||||||||||
On August 20, 2014, directly related to the merger, we issued 5,190,000 shares of Series A Convertible Preferred Stock at $1.00 per share. In connection with this issuance, we also issued detachable five-year warrants to purchase 6,487,500 common shares at a price of $0.50. Gross proceeds were $5.2 million, with net proceeds of $4.6 million, after transaction costs. | |||||||||||||||||||||||||
The preferred stock entitles its holders to a 6% cumulative dividend, payable semi-annually in cash or in kind, and may be converted to our common stock at the option of a holder at an initial conversion price of $0.40 per share, subject to adjustment. Subject to certain conditions, we may call and redeem the preferred stock after three years. During such time as a majority of the preferred stock sold remains outstanding, holders will have the right to elect a member to our Board of Directors. The holders of the preferred stock will be entitled to vote their shares on an as-converted basis and they will be entitled to a liquidation preference equal to the stated value (i.e., purchase price) of their shares plus any accrued but unpaid dividends thereon. | |||||||||||||||||||||||||
Subject to certain customary exceptions, the preferred stock has full-ratchet conversion price protection in the event that we issue common stock or common stock equivalents below the conversion price, as adjusted. The warrants issued to purchasers of the preferred stock contain similar full-ratchet exercise price protection in the event that we issue common stock or common stock equivalents below the exercise price, as adjusted, again subject to certain customary exceptions. In the Securities Purchase Agreement, we granted purchaser of the preferred stock certain registration rights pertaining to the shares of our common stock they may receive upon conversion of their preferred stock and upon exercise of their warrants. | |||||||||||||||||||||||||
We have determined that the convertible preferred stock contains a beneficial conversion feature based on the conversion price of $0.40 per share compared to the price at closing of $0.63 per share. The $1.1 million value of the beneficial conversion feature was recognized as a discount against the carrying value of the preferred stock and a credit to additional paid-in capital. The preferred stock became convertible on October 10, 2014 convertible, and accordingly the discount was amortized as an addition to additional paid-in capital over the period from the merger date to October 10, 2014. The preferred stock is classified as temporary equity of $1.5 million, net of the value of the warrants. The convertible preferred stock is redeemable at the option of the holder upon a change in control, as defined. Accordingly, there is no adjustment to the potential redemption price of the discount until it would be probable that a change in control would occur. | |||||||||||||||||||||||||
As mentioned above, we issued five-year warrants to purchase 6,487,500 common shares at a price of $0.50 as part of issuing the Series A Convertible Preferred Stock. We account for the warrants as a liability on the condensed consolidated balance sheet, at their estimated fair value. The liability will be marked-to-market each reporting period with the change impacting the statement of operations. We determined the fair value of the warrants at the August 20, 2014 date of issuance was $3.0 million and was $1.9 million at December 31, 2014. The change in value during the period from August 20, 2014 through December 31, 2014 of $1.1 is an increase to income on the statement of operations and was caused primarily by the decrease in our share price from $0.63 at issuance to $0.40 at December 31, 2014. The valuation is based on the Black-Scholes option pricing model (which approximates the binomial model due to probability factors used to determine the fair value), adjusted for the estimated value of the exercise price protection. The range of inputs used for the Black Scholes valuations of the warrant liabilities as of December 31, 2014 were as follows: Expected term of 3.65 years to 4.64 years; Risk Free Rate of 1.38% to 1.55%; Stock Price of $0.40; and Volatility of 98.0% to 102.97%. In connection with the issuance of Convertible Preferred Stock, we issued warrants, which in the aggregate allow for purchase of up to 6.5 million shares at an exercise price of $.50. In connection with the merger, we entered into certain consulting agreements and financial advisory agreements pursuant to which we issued, in private placements, warrants to purchase an aggregate of .5 million shares of common stock at the per-share price of $.50. | |||||||||||||||||||||||||
A summary of outstanding debt and equity warrants is included below: | |||||||||||||||||||||||||
Warrants (Equity) | Weighted | Warrants (Liability) | Weighted | ||||||||||||||||||||||
Amount | Weighted Average Exercise Price | Average Remaining Contractual Life | Amount | Weighted Average Exercise Price | Average Remaining Contractual Life | ||||||||||||||||||||
Balance, December 31, 2013 | - | $ | - | - | - | $ | - | - | |||||||||||||||||
Assumed as part of merger | 2,811,561 | 7.6 | 2.11 | - | - | - | |||||||||||||||||||
Warrants issued to Slipstream, LLC | 1,779,015 | 0.48 | 4.64 | - | - | - | |||||||||||||||||||
August 2014 convertible preferred | - | - | - | 6,487,500 | 0.5 | 4.64 | |||||||||||||||||||
Financial advisor warrants | - | - | - | 527,625 | 0.5 | 4.71 | |||||||||||||||||||
Balance, December 31, 2014 | 4,590,576 | $ | 4.84 | 3.09 | 7,015,125 | $ | 0.50 | 4.64 |
Stockholders_Equity
Stockholders' Equity | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Shareholders' Equity [Abstract] | |||||||||||||||||||||
STOCKHOLDERS' EQUITY | NOTE 12: STOCKHOLDERS’ EQUITY | ||||||||||||||||||||
Under reverse acquisition accounting, the amount of common stock reflects the equity structure of the legal acquirer (the par value and the number of shares outstanding of WRT). Under purchase accounting, stockholders’ equity reflects the recognition of approximately 46.2 million shares of our common stock issued and outstanding upon completion of the merger. Amounts in additional paid-in capital represent that of Creative Realities, adjusted to reflect the additional fair value of our shares issued, less the par value of our shares outstanding after the combination, and includes $1.4 million to reflect the portion of the purchase price related to the total estimated fair value of WRT warrants and the vested stock options outstanding on the merger date. Accumulated deficit represents that of Creative Realities prior to the merger date. | |||||||||||||||||||||
In addition to the warrants outstanding related to the Series A Convertible Preferred Stock discussed in note 11, we have other warrants outstanding at December 31, 2014. As discussed in Note 1, in connection with the merger transaction, we issued a warrant to the parent of Creative Realities to purchase 1.8 million our common shares at an exercise price of $0.48 per share. These warrants expire in August 2019. As discussed in Note 2, outstanding WRT warrants carried over, which in the aggregate allow for purchase of up to 2.8 million shares at prices ranging from $.70 to $83.37 and a weighted average exercise price of $7.60. | |||||||||||||||||||||
Under reverse acquisition accounting, as the accounting acquirer, Creative Realities is deemed (for accounting purposes only) to have issued replacement options to the registrant’s option holders, replacement warrants to the registrant’s warrant holders, in addition to the other issuances of warrants described in this report and summarized in the table below. All of registrant’s stock options were deemed to have vested in connection with a change of control (contemplated as part of the original award) as of the effective date of the transaction on August 20, 2014, and were included as purchase price consideration. | |||||||||||||||||||||
A summary of outstanding options is included below: | |||||||||||||||||||||
Weighted | |||||||||||||||||||||
Average | Weighted | Weighted | |||||||||||||||||||
Remaining | Average | Average | |||||||||||||||||||
Range of Exercise | Number | Contractual | Exercise | Options | Exercise | ||||||||||||||||
Prices between | Outstanding | Life | Price | Exercisable | Price | ||||||||||||||||
$0.45 - $0.65 | 4,809,318 | 9.66 | $ | 0.46 | 350,000 | $ | 0.39 | ||||||||||||||
$0.66 - $0.79 | 420,000 | 8.44 | 0.74 | 420,000 | $ | 0.74 | |||||||||||||||
$0.80 - $12.25 | 384,659 | 5.79 | 4.73 | 384,659 | $ | 5.48 | |||||||||||||||
5,613,977 | 9.30 | $ | 1.45 | ||||||||||||||||||
Weighted Average | |||||||||||||||||||||
Exercise Price | |||||||||||||||||||||
Balance, December 31, 2013 | $ | - | $ | - | |||||||||||||||||
Assumed as part of merger | 1,154,659 | 5.51 | |||||||||||||||||||
Granted | 4,459,318 | 0.4 | |||||||||||||||||||
Exercised | - | - | |||||||||||||||||||
Forfeited or expired | - | - | |||||||||||||||||||
Balance, December 31, 2014 | $ | 5,613,977 | $ | 1.45 | |||||||||||||||||
The weighted average remaining contractual life for options exercisable is 8.39 years as of December 31, 2014. |
StockBased_Compensation
Stock-Based Compensation | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Stock-Based Compensation [Abstract] | |||||||||
STOCK-BASED COMPENSATION | NOTE 13: STOCK-BASED COMPENSATION | ||||||||
Stock Compensation Expense Information | |||||||||
FASB ASC 718-10 requires measurement and recognition of compensation expense for all stock-based payments including warrants, stock options, restricted stock grants and stock bonuses based on estimated fair values. In October 2014, the Company’s shareholders approved the 2014 Stock Incentive Plan, under which 7,390,355 shares were reserved for purchase by the Company’s employees. | |||||||||
On October 9, 2014, the Board of Directors granted 3,753,427 options to purchase common stock of the Company to our CEO, and 480,685 options to purchase common stock of the Company to our COO/CFO. The options granted vest in 25% increments on each of the first four anniversaries of the date of grant, and expire ten years after the date of grant. In addition, on October 9, 2014, the Board of Directors granted 225,206 options to purchase common stock of the Company to certain employees. These options vest 25% per year on each of the first four anniversaries following the grant date. On October 9, 2014, the board of Directors also approved the allocation of 1,096,028 options to be reserved for grant to certain employees in the future. Compensation expense recognized for the issuance of stock options for the years ended December 31, 2014 and 2013 was as follows: | |||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Stock-based compensation costs included in: | |||||||||
Cost of sales | $ | - | $ | - | |||||
Sales and marketing expenses | 1 | - | |||||||
Research and development expenses | - | - | |||||||
General and administrative expenses | 59 | - | |||||||
Total stock-based compensation expenses | $ | 60 | $ | - | |||||
At December 31, 2014, there was approximately $1,374 of total unrecognized compensation expense related to unvested share-based awards. Generally, this expense will be recognized over the next 9.8 years and will be adjusted for any future changes in estimated forfeitures. | |||||||||
Valuation Information for Stock-Based Compensation | |||||||||
For purposes of determining estimated fair value under FASB ASC 718-10, the Company computed the estimated fair values of stock options using the Black-Scholes model. The weighted average estimated fair value of stock options granted during the years ended December 31, 2014 and 2013 was $0.36 and $0 per share, respectively. The values set forth above were calculated using the following weighted average assumptions: | |||||||||
Risk-free interest rate | 2.02% | ||||||||
Expected term | 6.25 years | ||||||||
Expected price volatility | 98% | ||||||||
Dividend yield | 0% | ||||||||
The Company does not have sufficient historical information to develop reasonable expectations about future exercise patterns and post-vesting employment behavior, so we estimate the expected term of awards granted by taking the average of the resting term and the contractual term of the awards, referred to as the simplified method. The risk-free interest rate assumption is based on observed interest rates appropriate for the term of the Company’s stock options. The Company uses historical closing stock price volatility for a period equal to the expected life of the respective award. The dividend yield assumption is based on the Company’s history and expectation of no future dividend payouts. | |||||||||
Stock-based compensation expense is based on awards ultimately expected to vest and is reduced for estimated forfeitures. FASB 718-10-55 requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The Company applied a pre-vesting forfeiture rate of 10% based on upon actual historical experience for employee option awards of the registrant. | |||||||||
ProfitSharing_Plan
Profit-Sharing Plan | 12 Months Ended |
Dec. 31, 2014 | |
Profit-Sharing Plan [Abstract] | |
PROFIT-SHARING PLAN | NOTE 14: PROFIT-SHARING PLAN |
We have a defined contribution 401(k) retirement plans for eligible associates. Associates may contribute up to 15% of their pretax compensation to the plan. There is currently no plan for an employer contribution match or company discretionary contributions. |
Segment_Information_and_Signif
Segment Information and Significant Customers | 12 Months Ended |
Dec. 31, 2014 | |
Segment Information and Significant Customers [Abstract] | |
SEGMENT INFORMATION AND SIGNIFICANT CUSTOMERS | NOTE 15: SEGMENT INFORMATION AND SIGNIFICANT CUSTOMERS |
Segment Information | |
We currently operate in one business segment, marketing technology solutions. Substantially all property and equipment is located at our offices in the United States, and a data center located in the United States. All sales for the years ended December 31, 2014 and 2013, were in the United States and Canada. | |
Major Customers | |
We had 2 and 2 customers that accounted for 41% and 44% of accounts receivable as of December 31, 2014 and 2013, respectively. | |
The Company had 3 and 3 customers that accounted for 53% and 54% of revenue for the years ended December 31, 2014 and 2013, respectively. |
Liquidity
Liquidity | 12 Months Ended |
Dec. 31, 2014 | |
Liquidity [Abstract] | |
LIQUIDITY | NOTE 16: LIQUIDITY |
We incurred net losses and negative cash flows from operating activities for years ended December 31, 2014 and 2013. As of December 31, 2014, we had cash and cash equivalents of $573 and working capital deficit of $(1,144). Management believes that, despite its losses to date and while we can provide no assurance that our ongoing integration efforts will be successful, the operations of the combined Company resulting from the completed acquisitions and related restructuring actions will provide greater sales, margin, scale and operating efficiencies, all of which we believe will ultimately lead to operating profitability and positive cash flows from operations. We have certain payment plans and settlements setup with certain vendors. We expect that our future available capital resources will consist primarily of cash on hand, any cash generated from our business operations and future equity and/or debt financings or support, if any, to support our growth objectives, ongoing working capital needs, and 2015 business plan. Our capital requirements depend on many factors, including our ability to successfully address our short-term liquidity and capital resource needs, market and sell our products and services, develop new products and services and establish and leverage our strategic partnerships. Any additional equity financings may be dilutive to shareholders and may be completed at a discount to market price. Public or private debt financing, if available, would likely involve restrictive covenants similar to or more restrictive than those contained in the Series A Convertible Preferred Stock Offering. There can be no assurance we will successfully complete any future equity or debt financing. | |
Subsequent_Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2014 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 17: SUBSEQUENT EVENTS |
Securities Purchase Agreement with Mill City Ventures III, Ltd. | |
On February 18, 2015, the Company entered into a Securities Purchase Agreement with Mill City Ventures III, Ltd. (“Mill City”), pursuant to which it offered and sold a secured convertible promissory note in the principal amount of $1,000,000 and a five-year warrant to purchase up to 1,515,152 shares of the Company’s common stock at a per-share price of $0.38, in a private placement exempt from registration under the Securities Act of 1933. | |
Creative Realities, LLC, Wireless Ronin Technologies Canada, Inc., and Broadcast International, Inc., the Company’s principal subsidiaries, are co-makers with the Company of the secured convertible promissory note. Obligations under the secured convertible promissory note are secured by a grant of collateral security in the accounts receivable and related proceeds of all co-makers pursuant to the terms of a security agreement. | |
The secured convertible promissory note bears interest at the annual rate of 12%, and matures on August 18, 2016. At any time prior to the maturity date, Mill City may convert the outstanding principal and accrued and unpaid interest at a conversion rate of $0.33 per share, as adjusted for stock splits and similar adjustments. Upon the consummation of a change in control transaction of the Company or of an offering of securities of the Company in which the gross proceeds to be received by the Company equal, when aggregated with all prior financings involving the sale of securities of the Company from and after February 18, 2015 (but exclusive of the amounts borrowed under the Mill City secured convertible promissory note), at least $3.5 million, Mill City may elect to convert the secured convertible promissory note into shares of common stock of the Company or elect repayment. The Company may prepay the secured convertible promissory note at any time; provided any principal amount prepaid must be accompanied by the payment of minimum amount of interest that, when aggregated with earlier payments of interest, equals at least 365 days of interest thereon. The secured convertible promissory note contains other customary terms. | |
On April 13, 2015, the Board of Directors and Paul Price agreed to terminate Mr. Prices’s employment with the Company without cause. In Mr. Price’s separation agreement with the Company, the Board of Directors agreed to vest 938,357 options granted to him on October 9,2014. | |
Sale of Series A Preferred Stock and Related Warrants. | |
On February 18, 2015, the Company entered into Subscription Agreements, pursuant to which Don Harris, a director of the Company, and Paul Price, the former Chief Executive Officer of the Company and a former director, subscribed for shares of the Company’s Series A Convertible Preferred Stock and related warrants in the aggregate amount of $90,000, and Slipstream Communications, LLC surrendered a Promissory Note of the Company dated January 28, 2015 and in the principal amount of $175,000, and converted such entire principal amount, plus accrued but unpaid interest thereon, into Series A Convertible Preferred Stock and related warrants. The warrants contain a cashless exercise feature and have a term of five years. The warrants are exercisable at a price of $0.50 per common share, as adjusted for stock splits, dilutive issuances and similar adjustments. As a result of the issuance of the convertible promissory note issued to Mill City set forth above, the exercise price is currently $0.49 per common share. |
Nature_of_Operations_and_Summa1
Nature of Operations and Summary of Significant Accounting Policies (Policies) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Nature of Operations and Summary of Significant Accounting Policies [Abstract] | |||||||||
Principles of Consolidation | 1. Principles of Consolidation | ||||||||
The consolidated financial statements include the accounts of Creative Realities, Inc. (f/k/a Wireless Ronin Technologies, Inc.), our wholly owned subsidiaries Creative Realities, LLC, Broadcast International, Inc., and Wireless Ronin Technologies Canada, Inc. All inter-company balances and transactions have been eliminated in consolidation, as applicable. | |||||||||
Foreign Currency | 2. Foreign Currency | ||||||||
Our functional currency for its operations, including those in Canada, is the U.S. Dollar. Foreign exchange transaction gains and losses attributable to exchange rate movements related to transactions made in the local currency and on intercompany receivables and payables not deemed to be of a long-term investment nature are recorded in other income (expense). | |||||||||
Revenue Recognition | 3. Revenue Recognition | ||||||||
We recognize revenue primarily from these sources: | |||||||||
● | System hardware sales | ||||||||
● | Professional services | ||||||||
● | Software design and development services | ||||||||
● | Software and software license sales | ||||||||
● | Implementation services | ||||||||
● | Maintenance and support services | ||||||||
We recognize revenue in accordance with Accounting Standards Codification (“ASC”) 605-910, Accounting for Performance of Construction-Type and Certain Production-Type Contracts, ASC 605-10-599, Revenue Recognition, ASC 605-25, Accounting for Revenue Arrangements with Multiple Deliverables, and ASC subtopic 605-985, Revenue Recognition: Software (or ASC 605-35), with respect to all transactions involving the sale of software licenses. In the event of a multiple-element arrangement, we evaluate if each element represents a separate unit of accounting, taking into account all factors following the guidelines set forth in FASB ASC 605-985-25-5. We recognize revenue when (i) persuasive evidence of an arrangement exists; (ii) delivery has occurred, which is when product title transfers to the customer, or services have been rendered; (iii) customer payments are fixed or determinable and free of contingencies and significant uncertainties; and (iv) collection is reasonably assured. If it is determined that collection of a fee is not reasonably assured, we defer the revenue and recognize it at the time collection becomes reasonably assured, which is generally upon receipt of cash payment, revenues are reported on a gross basis. | |||||||||
Revenues for services are recognized when the underlying service is delivered or performed pursuant to the terms of each arrangement. When the fair value of an undelivered element cannot be determined, we defer revenue for the delivered elements until the undelivered elements are delivered. If an acceptance period is required, revenue is recognized upon the earlier of customer acceptance or the expiration of the acceptance period. Sales and use taxes are reported on a net basis, excluding them from sales and cost of sales. | |||||||||
Multiple-Element Arrangements — We enter into arrangements with customers that include a combination of software products, system hardware, maintenance and support, or installation and training services. We allocate the total arrangement fee among the various elements of the arrangement based on the relative fair value of each of the undelivered elements determined by vendor-specific objective evidence (VSOE). In software arrangements for which we do not have VSOE of fair value for all elements, revenue is deferred until the earlier of when VSOE is determined for the undelivered elements (residual method) or when all elements for which we do not have VSOE of fair value have been delivered. We have determined VSOE of fair value for each of its products and services. | |||||||||
The VSOE for maintenance and support services is based upon the renewal rate for continued service arrangements. The VSOE for installation and training services is established based upon pricing for the services. The VSOE for software and licenses is based on the normal pricing and discounting for the product when sold separately. | |||||||||
Each element of our multiple-element arrangements qualifies for separate accounting. Nevertheless, when a sale includes both software and maintenance, we defer revenue under the residual method of accounting. Under this method, the undelivered maintenance and support fees included in the price of software is amortized ratably over the period the services are provided. We defer maintenance and support fees based upon the customer’s renewal rate for these services. | |||||||||
System hardware sales | |||||||||
We recognize revenue on system hardware sales generally upon shipment of the product or customer acceptance depending upon contractual arrangements with the customer. Shipping charges billed to customers are included in sales and the related shipping costs are included in cost of sales. | |||||||||
Professional services | |||||||||
Included in services and other revenues is revenue derived primarily from consulting related to discovery and requirements definition processes, the design and development of various marketing experiences, and content development and management. The majority of professional services and accompanying agreements qualify for separate accounting. Professional services are bid either on a fixed-fee basis, time-and-materials basis or both. For time-and-materials contracts, we recognize revenue as services are performed. For fixed-fee contracts, we recognize revenue upon completion of specific contractual milestones, by using the percentage-of-completion method, or the completed contract method. | |||||||||
Software design and development services | |||||||||
Revenue from contracts for technology integration consulting services where we design/redesign, build and implement new or enhanced systems applications and related processes for clients are recognized on the percentage-of-completion method in accordance with FASB ASC 605-985-25-88 through 107. Percentage-of-completion accounting involves calculating the percentage of services provided during the reporting period compared to the total estimated services to be provided over the duration of the contract. Estimated revenues from applying the percentage-of-completion method include estimated incentives for which achievement of defined goals is deemed probable. Contract costs include all direct material, labor, subcontractors, certain indirect costs, such as indirect labor, equipment costs, supplies, tools and depreciation costs. Selling, general and administrative costs are charges to expense as incurred. This method is followed where reasonably dependable estimates of revenues and costs can be made. We measure progress for completion based on either the hours worked as a percentage of the total number of hours of the project or by delivery and customer acceptance of specific milestones as outlined per the terms of the agreement with the customer. Estimates of total contract revenue and costs are continuously monitored during the term of the contract, and recorded revenue and costs are subject to revision as the contract progresses. Such revisions may result in increases or decreases to revenue and income and are reflected in the financial statements in the periods in which they are first identified. If estimates indicate that a contract loss will occur, a loss provision is recorded in the period in which the loss first becomes probable and reasonably estimable. Contract losses are determined to be the amount by which the estimated direct and indirect costs of the contract exceed the estimated total revenue that will be generated by the contract and are included in cost of sales and classified in accrued expenses in the balance sheet. Our presentation of revenue recognized on a contract completion basis has been consistently applied for all periods presented. | |||||||||
Software and software license sales | |||||||||
We recognize revenue when a fixed fee order has been received and delivery has occurred to the customer. We assess whether the fee is fixed or determinable and free of contingencies based upon signed agreements received from the customer confirming terms of the transaction. Software is delivered to customers electronically or on a CD-ROM, and license files are delivered electronically. | |||||||||
Implementation services | |||||||||
We recognize implementation services revenue when an installation or deployment is completed. | |||||||||
Maintenance and support services | |||||||||
Maintenance and support consists of software updates and various forms of support services. Software updates provide customers with rights to unspecified software product upgrades and maintenance releases and patches released during the term of the support period. Support includes access to technical support personnel for software and hardware issues. We also offer a hosting service through our network operations center, or NOC, allowing the ability to monitor and support its customers’ networks 7 days a week, 24 hours a day. | |||||||||
Maintenance and support revenue is recognized ratably over the term of the contract, which is typically one to three years. Maintenance and support is renewable by the customer. Rates for maintenance and support, including subsequent renewal rates, are typically established based upon a fee per location, per device, or a specified percentage of net software license fees as set forth in the arrangement. We support agreement fees are based on the level of service provided to its customers, which can range from monitoring the health of a customer’s network to supporting a sophisticated web-portal to managing the end-to-end hardware and software of a digital marketing system. | |||||||||
Costs and estimated earnings recognized in excess of billings on uncompleted contracts are recorded as unbilled services and are included in work-in-process on the balance sheet. Billings in excess of costs and estimated earnings on uncompleted contracts are recorded as deferred revenue until revenue recognition criteria are met. Unbilled receivables are a normal part of our business as some receivables are invoiced in the month following shipment or completion of services. Our policy is to present any taxes imposed on revenue-producing transactions on a net basis. | |||||||||
Cash and Cash Equivalents | 4. Cash and Cash Equivalents | ||||||||
Cash equivalents consist of commercial paper and all other liquid investments with original maturities of three months or less when purchased. As of December 31, 2014, the Company had substantially all cash invested in a commercial paper sweep account. The Company maintains the majority of its cash balances in one financial institution located in Chicago. As of December 31, 2013, the Company had substantially all cash invested in a commercial bank account in New Jersey. The balances are insured by the Federal Deposit Insurance Corporation up to $250. | |||||||||
Accounts Receivable and Allowance for Doubtful Accounts | 5. Accounts Receivable and Allowance for Doubtful Accounts | ||||||||
Our unsecured accounts receivable are customer obligations due under normal trade terms, carried at their face value less an allowance for doubtful accounts. We determine our allowance for doubtful accounts based on the evaluation of the aging of its accounts receivable and on a customer-by-customer analysis of its high-risk customers. Our reserves contemplate our historical loss rate on receivables, specific customer situations and the economic environments in which we operate. We determine past-due accounts receivable on a customer-by-customer basis. Accounts receivable are written off after all reasonable collection efforts have failed. | |||||||||
Work-In-Process and Inventories | 6. Work-In-Process and Inventories | ||||||||
Our work-in-process and inventories are recorded using the lower of cost or market on a first-in, first-out (FIFO) method. Inventory is net of an allowance for obsolescence of $22 and $245 as of December 31, 2014 and 2013, respectively. | |||||||||
Fair Value of Financial Instruments | 7. Fair Value of Financial Instruments | ||||||||
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). Inputs are broadly defined as assumptions market participants would use in pricing an asset or liability. | |||||||||
FASB ASC 820-10, Fair Value Measurements and Disclosures, requires disclosure of the estimated fair value of an entity's financial instruments. Such disclosures, which pertain to our financial instruments, do not purport to represent our aggregate net fair value. The carrying value of cash and cash equivalents, accounts receivable, accounts payable, and accrued liabilities approximate fair value because of the short maturity of those instruments. The fair value of the loan payable approximates carrying value based on the interest rates in the agreement compared to current market interest rates. The fair value of the warrant liabilities is calculated using a black scholes model which approximates a binomial model. See Note 11 for more information. | |||||||||
Impairment of Long-Lived Assets | 8. Impairment of Long-Lived Assets | ||||||||
We review the carrying value of all long-lived assets, including property and equipment, for impairment in accordance with “FASB ASC 360-10-05-4,” Accounting for the Impairment or Disposal of Long-Lived Assets. Under FASB ASC 360-10-05-4, impairment losses are recorded whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable. | |||||||||
If the impairment tests indicate that the carrying value of the asset is greater than the expected undiscounted cash flows to be generated by such asset, an impairment loss would be recognized. The impairment loss is determined by the amount by which the carrying value of such asset exceeds its fair value. We generally measure fair value by considering sale prices for similar assets or by discounting estimated future cash flows from such assets using an appropriate discount rate. Assets to be disposed of are carried at the lower of their carrying value or fair value less costs to sell. Considerable management judgment is necessary to estimate the fair value of assets, and accordingly, actual results could vary significantly from such estimates. There were no impairment losses for long-lived assets recorded for the years ended December 31, 2014 and 2013. | |||||||||
Property and Equipment | 9. Property and Equipment | ||||||||
Property and equipment are carried at cost, less accumulated depreciation and amortization. Depreciation is provided for in amounts sufficient to relate the cost of depreciable assets to operations over the estimated service lives, principally using straight-line methods. Leasehold improvements are amortized over the shorter of the life of the improvement or the lease term, using the straight-line method. | |||||||||
The estimated useful lives used to compute depreciation and amortization are as follows: | |||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Equipment | $ | 1,596 | $ | 1,163 | |||||
Leasehold improvements | 1,015 | 396 | |||||||
Purchased software | 242 | - | |||||||
Furniture and fixtures | 288 | 209 | |||||||
Other depreciables | 27 | - | |||||||
Total property and equipment | 3,169 | 1,768 | |||||||
Less: accumulated depreciation and amortization | (2,423 | ) | (1,547 | ) | |||||
Net property and equipment | $ | 746 | $ | 221 | |||||
Equipment | 3 – 5 years | ||||||||
Demonstration equipment | 3 – 5 years | ||||||||
Furniture and fixtures | 7 years | ||||||||
Purchased software | 3 years | ||||||||
Leased equipment | 3 years | ||||||||
Leasehold improvements | Shorter of 5 years or term of lease | ||||||||
Depreciation expense was $251 and $175 for the years ended December 31, 2014 and 2013, respectively. | |||||||||
Research and Development and Software Development Costs | 10. Research and Development and Software Development Costs | ||||||||
Research and development expenses consist primarily of development personnel and non-employee contractor costs related to the development of new products and services, enhancement of existing products and services, quality assurance and testing. FASB ASC 985-20-25, Accounting for the Costs of Computer Software to Be Sold, Leased, or Otherwise Marketed, requires certain software development costs to be capitalized upon the establishment of technological feasibility. The establishment of technological feasibility and the ongoing assessment of the recoverability of these costs require considerable judgment by management with respect to certain external factors such as anticipated future revenue, estimated economic life, and changes in software and hardware technologies. Software development costs incurred beyond the establishment of technological feasibility have not been significant. No software development costs were capitalized during the years ended December 31, 2014 and 2013. Software development costs have been recorded as research and development expense for the years ended December 31, 2014 and 2013. We incurred research and development expenses of $492 and $0 during the years ended December 31, 2014 and 2013, respectively. | |||||||||
Basic and Diluted Loss per Common Share | 11. Basic and Diluted Loss per Common Share | ||||||||
Basic and diluted loss per common share for all periods presented is computed using the weighted average number of common shares outstanding by adding Creative Realities, LLC weighted average number of basic shares outstanding for that period, determined by applying the conversion ratio from the merger to the outstanding shares of Creative, plus the number of Creative shares deemed issued to CRI stockholders as a result of the merger. Basic weighted average shares outstanding include only outstanding common shares. Diluted net loss per common share is computed by dividing net loss by the weighted average common and potential dilutive common shares outstanding computed in accordance with the treasury stock method. Shares reserved for outstanding stock options and warrants totaling approximately 17.3 million at December 31, 2014 were excluded from the computation of loss per share as well as the potential common shares issuable upon conversion of convertible preferred stock as their effect was antidilutive due to our net loss. Net loss attributable to common shareholders for the year ended December 31, 2014 is after dividends on convertible preferred stock of $112 and amortization of the beneficial conversion feature of $1,103. | |||||||||
Deferred Income Taxes | 12. Deferred Income Taxes | ||||||||
The calculation of our income tax provision involves dealing with uncertainties in the application of complex tax regulations. We recognize tax liabilities for uncertain income tax positions based on management’s estimate of whether it is more likely than not that additional taxes will be required. We had no uncertain tax positions as of December 31, 2014 and 2013. Deferred income taxes are recognized in the financial statements for the tax consequences in future years of differences between the tax basis of assets and liabilities and their financial reporting amounts based on enacted tax laws and statutory tax rates. Temporary differences arise from net operating losses, differences in basis of intangibles (other than goodwill), stock-based compensation, reserves for uncollectible accounts receivable and inventory, differences in depreciation methods, and accrued expenses. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. | |||||||||
Our federal and state tax returns are potentially open to examinations for all years since 2011. As of December 31, 2014, we are not under any income tax audits by tax authorities. With few exceptions, we are no longer subject to U.S. federal, state or local income tax examinations by tax authorities for the years before 2011 and are not currently under examination by any taxing jurisdiction. In the event of any future tax assessments, we have elected to record the income taxes and any related interest and penalties as income tax expense on our statement of operations. | |||||||||
Until the merger date, Creative Realities, LLC was taxed as a limited liability company and, as such, any profit or loss from our operations flowed directly to the member who was then responsible to pay any federal or state income tax. We were only responsible for paying any minimum business and filing income tax costs. The Company has not included any pro forma income tax information as if the Company were a tax paying entity for the years ended December 31, 2014 and 2013, as any pro forma tax benefit on the losses before income taxes would be offset by a valuation allowance for the related deferred tax asset as it would be more likely than not that the future tax benefits will not be realized. | |||||||||
Accounting for Stock-Based Compensation | 13. Accounting for Stock-Based Compensation | ||||||||
The Company accounts for stock-based compensation in accordance with FASB ASC 718-10 that requires the measurement and recognition of compensation expense for all stock-based payments including warrants, stock options, restricted stock grants and stock bonuses based on estimated fair value. For purposes of determining estimated fair value under FASB ASC 718-10-30, the Company computes the estimated fair values of stock options using the Black-Scholes option pricing model. Stock-based compensation expense of $60 and $0 was charged to expense during the years ended December 31, 2014 and 2013, respectively. | |||||||||
Goodwill and Indefinite-Lived Intangible Assets | 14. Goodwill and Indefinite-Lived Intangible Assets | ||||||||
We follow the provisions of ASC 350, Goodwill and Other Intangible Assets. Pursuant to ASC 350, goodwill acquired in a purchase business combination and is not amortized, but instead tested for impairment at least annually using a measurement date of September 30 (see Note 5). No impairment expense was recorded during the years ended December 31, 2014 and 2013. | |||||||||
Use of Estimates | 15. Use of Estimates | ||||||||
The preparation of financial statements in conformity with U.S. generally accepted accounting principles 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 amounts of revenues and expenses during the reporting periods. Our significant estimates are the allowance for doubtful accounts, recognition of revenue under fixed price contracts, deferred tax assets, deferred revenue, depreciable lives and methods of property and equipment, valuation of warrants and other stock-based compensation. Actual results could differ from those estimates. | |||||||||
Change in authorized shares | 16. Change in authorized shares | ||||||||
On October 15, 2014, the Company filed articles of amendment to articles of incorporation to change the authorized common shares from 50,000,000 to 200,000,000 and preferred shares from 16,666,666 to 50,000,000, which were approved by the shareholders. Form 8-K filed with the Securities and Exchange Commission on October 16, 2014 reflects this change. | |||||||||
Recently Issued Accounting Pronouncements | 17. Recently Issued Accounting Pronouncements | ||||||||
In April 2014, the FASB issued ASU No. 2014-08 "Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of Equity", which amends the definition of a discontinued operation in Accounting Standards Codification, or ASC, 205-20 and requires entities to provide additional disclosures about discontinued operations as well as disposal transactions that do not meet the discontinued operations criteria. The new guidance changes the definition of a discontinued operation and requires discontinued operations treatment for disposals of a component or group of components that represents a strategic shift that has or will have a major impact on an entity's operations or financial results. The ASU is effective prospectively for all disposals (except disposals classified as held for sale before the adoption date) or components initially classified as held for sale in periods beginning on or after December 15, 2014; earlier adoption is permitted. The adoption of this guidance affects prospective presentation of disposals and therefore, is not expected to have a material impact on the Company's consolidated financial condition, results of operations or cash flows. | |||||||||
In May 2014, the Financial Accounting Standards Board (FASB) issued guidance creating Accounting Standards Codification ("ASC") Section 606, "Revenue from Contracts with Customers". The new section will replace Section 605, "Revenue Recognition" and creates modifications to various other revenue accounting standards for specialized transactions and industries. The section is intended to conform revenue accounting principles with a concurrently issued International Financial Reporting Standards with previously differing treatment between United States practice and those of much of the rest of the world, as well as, to enhance disclosures related to disaggregated revenue information. The updated guidance is effective for annual reporting periods beginning on or after December 15, 2016, and interim periods within those annual periods. The Company will adopt the new provisions of this accounting standard at the beginning of fiscal year 2017, given that early adoption is not an option. The Company will further study the implications of this statement in order to evaluate the expected impact on its financial statements. | |||||||||
Reclassifications | 18. Reclassifications | ||||||||
Certain reclassifications were made to the 2013 consolidated financial statements to conform to the 2014 presentation with no effect on net loss on shareholders’ equity. |
Nature_of_Operations_and_Summa2
Nature of Operations and Summary of Significant Accounting Policies (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Nature of Operations and Summary of Significant Accounting Policies [Abstract] | |||||||||
Schedule of property and equiment estimated useful lives to compute depreciation and amortization | |||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Equipment | $ | 1,596 | $ | 1,163 | |||||
Leasehold improvements | 1,015 | 396 | |||||||
Purchased software | 242 | - | |||||||
Furniture and fixtures | 288 | 209 | |||||||
Other depreciables | 27 | - | |||||||
Total property and equipment | 3,169 | 1,768 | |||||||
Less: accumulated depreciation and amortization | (2,423 | ) | (1,547 | ) | |||||
Net property and equipment | $ | 746 | $ | 221 | |||||
Equipment | 3 – 5 years | ||||||||
Demonstration equipment | 3 – 5 years | ||||||||
Furniture and fixtures | 7 years | ||||||||
Purchased software | 3 years | ||||||||
Leased equipment | 3 years | ||||||||
Leasehold improvements | Shorter of 5 years or term of lease |
Creative_Realities_LLC_Merger_
Creative Realities, LLC Merger (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Creative Realities, LLC Merger [Abstract] | |||||||||
Schedule of preliminary estimate of the merger consideration | (in thousands) | ||||||||
Deemed (for accounting purposes only) issuance of shares to CRI, Inc. shareholders | $ | 10,775 | |||||||
Deemed (for accounting purposes only) issuance of warrants to CRI, Inc. shareholders | 754 | ||||||||
Deemed (for accounting purposes only) issuance of stock options to CRI, Inc. shareholders | 602 | ||||||||
Assumption of liabilities in excess of assets acquired | 1,588 | ||||||||
Total consideration | $ | 13,719 | |||||||
Schedule of fair value assumptions of warrants and stock options awards | Risk-free interest rate | 0.49%-2.09% | |||||||
Expected term | 1.3-7.0 years | ||||||||
Expected price volatility | 98%-143% | ||||||||
Dividend yield | - | ||||||||
Schedule of purchase price allocation for acquisitions | (in thousands) | ||||||||
Current assets | $ | 1,901 | |||||||
Property and equipment | 167 | ||||||||
Goodwill | 9,210 | ||||||||
Other intangible assets | 5,164 | ||||||||
Other assets | 77 | ||||||||
Total assets | 16,519 | ||||||||
Current liabilities | 2,800 | ||||||||
Total liabilities | 2,800 | ||||||||
Estimated purchase price | $ | 13,719 | |||||||
Schedule of purchase price allocation to identifiable intangible assets and related amortization lives | Useful lives | ||||||||
(in thousands) | Amounts | (years) | |||||||
Technology platform - Broadcast | $ | 260 | 5 | ||||||
Technology platform - Wireless Ronin | 3,930 | 4 | |||||||
Customer relationships | 1,090 | 3 | |||||||
Total | $ | 5,280 | |||||||
Schedule of pro forma combined results of operations | Years ended | ||||||||
(Unaudited) | December 31, | ||||||||
2014 | 2013 | ||||||||
Supplemental pro forma combined results of operations: | |||||||||
Net sales | $ | 15,098 | $ | 21,415 | |||||
Net loss | (6,362 | ) | (11,682 | ) |
Fair_Value_Measurement_Tables
Fair Value Measurement (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Fair Value Measurement [Abstract] | |||||||||||||||||
Summary of market activity for the asset or liability | |||||||||||||||||
Description | Fair Value | Quote Prices In Active Markets (Level 1) | Significant Other Observable Inputs | Significant Other Unobservable inputs | |||||||||||||
(Level 2) | (Level 3) | ||||||||||||||||
Warrant Liabilities | 1,910 | - | - | 1,910 | |||||||||||||
Summary of change in fair value | |||||||||||||||||
Record warrant liability in August 2014 | $ | 3,037 | |||||||||||||||
Decrease in fair value of warrant liability | (1,127 | ) | |||||||||||||||
Ending warrant liability as of December 31, 2014 | $ | 1,910 | |||||||||||||||
Other_Financial_Statement_Info1
Other Financial Statement Information (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Other Financial Statement Information [Abstract] | |||||||||
Schedule of Inventories | |||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Finished goods | $ | 531 | $ | 82 | |||||
Work-in-process | 208 | 677 | |||||||
Total inventories | $ | 739 | $ | 759 | |||||
Supplemental Cash Flow Information | |||||||||
Cash paid for Interest | 18 | 33 | |||||||
Cash paid for taxes | - | - | |||||||
Non-cash conversion of borrowings from affiliate to equity | 2,126 | 1,316 | |||||||
Leasehold improvements paid for by landlord allowance | 344 | - |
Goodwill_and_Other_Intangible_1
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Goodwill and Other Intangible Assets [Abstract] | |||||||||||||||||
Goodwill | Goodwill at December 31, 2012 | $ | 1,362 | ||||||||||||||
Change in 2013 | - | ||||||||||||||||
Merger of Creative and WRT (note 2) | 9,210 | ||||||||||||||||
Goodwill at December 31, 2014 | $ | 10,572 | |||||||||||||||
Other Intangible Assets | 2014 | 2013 | |||||||||||||||
Gross | Gross | ||||||||||||||||
Carrying | Accumulated | Carrying | Accumulated | ||||||||||||||
Amount | Amortization | Amount | Amortization | ||||||||||||||
Technology platform | $ | 4,190 | $ | 374 | $ | - | $ | - | |||||||||
Customer relationships | 1,090 | 131 | - | - | |||||||||||||
Trademarks and trade names | 300 | 240 | 300 | 180 | |||||||||||||
5,580 | $ | 745 | 300 | $ | 180 | ||||||||||||
Accumulated amortization | 746 | 180 | |||||||||||||||
Net book value of amortizable intangible assets | $ | 4,834 | $ | 120 | |||||||||||||
Estimated amortization expense of intangible assets | |||||||||||||||||
Year ending December 31, | |||||||||||||||||
2015 | $ | 1,460 | |||||||||||||||
2016 | 1,400 | ||||||||||||||||
2017 | 1,268 | ||||||||||||||||
2018 | 681 | ||||||||||||||||
2019 | 35 |
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Commitments and Contingencies [Abstract] | |||||
Schedule of future minimum lease payments under leases | |||||
Year ending December 31, | Lease Obligations | ||||
2015 | $ | 658 | |||
2016 | 669 | ||||
2017 | 663 | ||||
2018 | 495 | ||||
2019 | 472 | ||||
Total future minimum obligations | 195 | ||||
$ | 3,154 |
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Income Taxes [Abstract] | |||||
Components of deferred taxes and liabilities | December 31, | ||||
2014 | |||||
Deferred tax assets (liabilities): | |||||
Reserves | $ | (72 | ) | ||
Property and equipment | (4 | ) | |||
Accrued expenses | 781 | ||||
Severance | 178 | ||||
Non-qualified stock options | 419 | ||||
Net foreign carryforwards | 1,349 | ||||
Net operating loss and credit carryforwards | 5,592 | ||||
Intangibles | 57 | ||||
Total Deferred Tax Assets (includes $7,255 recorded upon merger - Note 2) | 8,300 | ||||
Valuation Allowance (includes $97,255 recorded upon merger - Note 2) | (8,300 | ) | |||
Net deferred tax assets (liabilities) | $ | - | |||
Components of income tax expense | |||||
Year ended December 31, | |||||
2014 | |||||
Tax Provision Summary | |||||
Deferred Provision (Benefit) - Federal | $ | (987 | ) | ||
Deferred Provision (Benefit) - State | (58 | ) | |||
Deferred Provision (Benefit) - Foreign | - | ||||
Change in valuation allowance | 1,045 | ||||
Tax Expense | $ | 0 |
Convertible_Preferred_Stock_an1
Convertible Preferred Stock and Warrants (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
Convertible Preferred Stock and Warrants [Abstract] | |||||||||||||||||||||||||
Summary of outstanding debt and equity warrants | Warrants (Equity) | Weighted | Warrants (Liability) | Weighted | |||||||||||||||||||||
Amount | Weighted Average Exercise Price | Average Remaining Contractual Life | Amount | Weighted Average Exercise Price | Average Remaining Contractual Life | ||||||||||||||||||||
Balance, December 31, 2013 | - | $ | - | - | - | $ | - | - | |||||||||||||||||
Assumed as part of merger | 2,811,561 | 7.6 | 2.11 | - | - | - | |||||||||||||||||||
Warrants issued to Slipstream, LLC | 1,779,015 | 0.48 | 4.64 | - | - | - | |||||||||||||||||||
August 2014 convertible preferred | - | - | - | 6,487,500 | 0.5 | 4.64 | |||||||||||||||||||
Financial advisor warrants | - | - | - | 527,625 | 0.5 | 4.71 | |||||||||||||||||||
Balance, December 31, 2014 | 4,590,576 | $ | 4.84 | 3.09 | 7,015,125 | $ | 0.50 | 4.64 |
Stockholders_Equity_Tables
Stockholders' Equity (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Shareholders' Equity [Abstract] | |||||||||||||||||||||
Schedule of stock options outstanding and exercisable | Weighted | ||||||||||||||||||||
Average | Weighted | Weighted | |||||||||||||||||||
Remaining | Average | Average | |||||||||||||||||||
Range of Exercise | Number | Contractual | Exercise | Options | Exercise | ||||||||||||||||
Prices between | Outstanding | Life | Price | Exercisable | Price | ||||||||||||||||
$0.45 - $0.65 | 4,809,318 | 9.66 | $ | 0.46 | 350,000 | $ | 0.39 | ||||||||||||||
$0.66 - $0.79 | 420,000 | 8.44 | 0.74 | 420,000 | $ | 0.74 | |||||||||||||||
$0.80 - $12.25 | 384,659 | 5.79 | 4.73 | 384,659 | $ | 5.48 | |||||||||||||||
5,613,977 | 9.30 | $ | 1.45 | ||||||||||||||||||
Summary of stock option activity | |||||||||||||||||||||
Weighted Average | |||||||||||||||||||||
Exercise Price | |||||||||||||||||||||
Balance, December 31, 2013 | $ | - | $ | - | |||||||||||||||||
Assumed as part of merger | 1,154,659 | 5.51 | |||||||||||||||||||
Granted | 4,459,318 | 0.4 | |||||||||||||||||||
Exercised | - | - | |||||||||||||||||||
Forfeited or expired | - | - | |||||||||||||||||||
Balance, December 31, 2014 | $ | 5,613,977 | $ | 1.45 | |||||||||||||||||
StockBased_Compensation_Tables
Stock-Based Compensation (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Stock-Based Compensation [Abstract] | |||||||||
Schedule Of Compensation Expense | December 31, | ||||||||
2014 | 2013 | ||||||||
Stock-based compensation costs included in: | |||||||||
Cost of sales | $ | - | $ | - | |||||
Sales and marketing expenses | 1 | - | |||||||
Research and development expenses | - | - | |||||||
General and administrative expenses | 59 | - | |||||||
Total stock-based compensation expenses | $ | 60 | $ | - | |||||
Schedule Of Weighted Average Assumptions | Risk-free interest rate | 2.02% | |||||||
Expected term | 6.25 years | ||||||||
Expected price volatility | 98% | ||||||||
Dividend yield | 0% |
Nature_of_Operations_and_Summa3
Nature of Operations and Summary of Significant Accounting Policies (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $3,169 | $1,768 |
Less: accumulated depreciation and amortization | -2,423 | -1,547 |
Net property and equipment | 746 | 221 |
Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 1,596 | 1,163 |
Equipment [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | P5Y | |
Equipment [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | P3Y | |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | P5Y | |
Total property and equipment | 1,015 | 396 |
Purchased software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | P3Y | |
Total property and equipment | 242 | |
Furniture and fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | P7Y | |
Total property and equipment | 288 | 209 |
Other depreciables [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $27 |
Nature_of_Operations_and_Summa4
Nature of Operations and Summary of Significant Accounting Policies (Details Textual) (USD $) | 0 Months Ended | 12 Months Ended | |||||
In Thousands, except Share data, unless otherwise specified | Aug. 20, 2014 | Aug. 18, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Oct. 15, 2014 |
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | |||||||
Sale of stock price per share | $1 | ||||||
Inventory reserve | $22 | $245 | |||||
Impairment losses for long-lived assets | |||||||
Depreciation expense | 251 | 175 | |||||
Research and development expenses | 492 | ||||||
Shares reserved for outstanding stock warrants and options | 17,300,000 | ||||||
Dividends, Preferred stock, cash | 112 | ||||||
Common stock, shares authorized | 200,000 | 200,000 | 200,000,000 | ||||
Common shares authorized prior to amendment | 50,000,000 | ||||||
Preferred stock, shares authorized | 16,667,000 | 16,667,000 | 50,000,000 | ||||
Preferred shares authorized prior to amendment | 16,666,666 | ||||||
Federal Deposit Insurance Corporation up to | 250 | ||||||
Stock-based compensation | 60 | ||||||
Exercise price of warrants | $0.50 | ||||||
Issuance of warrants to purchase common shares | 6,487,500 | 6,487,000 | 1,300,000 | ||||
Term of warrants | 5 years | ||||||
Amortization of beneficial conversion feature | 1,103 | ||||||
Foreign currency gains included in comprehensive losses | $10 | $0 | $0 | ||||
Creative Realities LLC [Member] | |||||||
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | |||||||
Sale of stock price per share | 0.63 | ||||||
Common stock equivalent shares percentage | 59.20% | ||||||
Beneficially ownership shares | 32,249,949 | ||||||
Beneficially ownership shares percentage | 45.80% | ||||||
Exercise price of warrants | $0.48 | ||||||
Issuance of warrants to purchase common shares | 1,800,000 | ||||||
Series A Convertible Preferred Stock [Member] | |||||||
Nature Of Operations And Summary Of Significant Accounting Policies [Line Items] | |||||||
Sale of shares under securities purchase agreement | 5,190,000 |
Creative_Realities_LLC_Merger_1
Creative Realities, LLC Merger (Details) (USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Dec. 31, 2014 |
Creative Realities, LLC Merger [Abstract] | |
Deemed (for accounting purposes only) issuance of shares to CRI, Inc. shareholders | $10,775 |
Deemed (for accounting purposes only) issuance of warrants to CRI, Inc. shareholders | 754 |
Deemed (for accounting purposes only) issuance of stock options to CRI, Inc. shareholders | 602 |
Assumption of liabilities in excess of assets acquired | 1,588 |
Total consideration | $13,719 |
Creative_Realities_LLC_Merger_2
Creative Realities, LLC Merger (Details 1) | 12 Months Ended |
Dec. 31, 2014 | |
Risk-free interest rate | 2.02% |
Expected term | 6 years 3 months |
Expected price volatility | 98.00% |
Dividend yield | 0.00% |
Maximum [Member] | |
Risk-free interest rate | 2.09% |
Expected term | 7 years |
Expected price volatility | 143.00% |
Minimum [Member] | |
Risk-free interest rate | 0.49% |
Expected term | 1 year 3 months 18 days |
Expected price volatility | 98.00% |
Creative_Realities_LLC_Merger_3
Creative Realities, LLC Merger (Details 2) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Creative Realities, LLC Merger [Abstract] | |||
Current assets | $1,901,000 | ||
Property and equipment | 167,000 | ||
Goodwill | 10,572,000 | 1,362,000 | 1,400 |
Other intangible assets | 5,164,000 | ||
Other assets | 77,000 | ||
Total assets | 16,519,000 | ||
Current liabilities | 2,800,000 | ||
Total liabilities | 2,800,000 | ||
Estimated purchase price | $13,719,000 |
Creative_Realities_LLC_Merger_4
Creative Realities, LLC Merger (Details 3) (USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Dec. 31, 2014 |
Finite-Lived Intangible Assets [Line Items] | |
Purchase price allocation to identifiable intangible assets | $5,280 |
Purchase price allocation to identifiable intangible assets and related amortization lives | 4 years |
Technology Platform Broadcast [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Purchase price allocation to identifiable intangible assets | 260 |
Purchase price allocation to identifiable intangible assets and related amortization lives | 5 years |
Technology Platform Wireless Ronin [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Purchase price allocation to identifiable intangible assets | 3,930 |
Purchase price allocation to identifiable intangible assets and related amortization lives | 4 years |
Customer Relationships [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Purchase price allocation to identifiable intangible assets | $1,090 |
Purchase price allocation to identifiable intangible assets and related amortization lives | 3 years |
Creative_Realities_LLC_Merger_5
Creative Realities, LLC Merger (Details 4) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Creative Realities, LLC Merger [Abstract] | ||
Net sales | $15,098 | $21,415 |
Net loss | ($6,362) | ($11,682) |
Creative_Realities_LLC_Merger_6
Creative Realities, LLC Merger (Details Textual) (USD $) | 12 Months Ended | 0 Months Ended | |||
Dec. 31, 2014 | Dec. 31, 2013 | Aug. 20, 2014 | Aug. 01, 2014 | Aug. 18, 2014 | |
Business Acquisition [Line Items] | |||||
Sale of stock price per share | $1 | ||||
Fair value of amortizable intangible assets | $5,200,000 | ||||
Purchase price allocation to identifiable intangible assets and related amortization lives | 4 years | ||||
Deferred revenue | -245,000 | 1,516,000 | |||
Accrual for rent | 200,000 | ||||
Acquisition-related costs | -1,194,000 | 1,140,000 | |||
Finite-Lived Intangible Assets [Member] | |||||
Business Acquisition [Line Items] | |||||
Purchase price allocation to identifiable intangible assets and related amortization lives | 3 years 10 months 24 days | ||||
Creative Realities LLC [Member] | |||||
Business Acquisition [Line Items] | |||||
Business combination, consideration transferred, equity interests issued and issuable | 10,800,000 | ||||
Sale of stock price per share | $0.63 | ||||
Deferred revenue | 300,000 | ||||
Amortized over the remaining lease term | 31-Dec-18 | ||||
Acquisition-related costs | 200,000 | ||||
Business combination equity interests issued or issuance of shares percentage | 59.20% | ||||
Issuance of warrants to purchase common shares percentage | 1.50% | ||||
Beneficially ownership shares | 32,249,949 | ||||
Beneficially ownership shares percentage | 45.80% | ||||
Business combination equity interest issued or issuable number of shares | 17,100,000 | ||||
Estimated fair value of warrants and vested stock options | 1,400,000 | ||||
Fair value of purchase price | 13,700,000 | ||||
Creative Realities LLC [Member] | Maximum [Member] | Finite-Lived Intangible Assets [Member] | |||||
Business Acquisition [Line Items] | |||||
Purchase price allocation to identifiable intangible assets and related amortization lives | 5 years | ||||
Creative Realities LLC [Member] | Minimum [Member] | Finite-Lived Intangible Assets [Member] | |||||
Business Acquisition [Line Items] | |||||
Purchase price allocation to identifiable intangible assets and related amortization lives | 3 years | ||||
Broadcast International, Inc. [Member] | |||||
Business Acquisition [Line Items] | |||||
Business combination, consideration transferred, equity interests issued and issuable | $3,600,000 | ||||
Issuance of warrants to purchase common shares percentage | 36.50% | ||||
Business combination equity interest issued or issuable number of shares | 7,100,000 |
Fair_Value_Measurement_Details
Fair Value Measurement (Details) (USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Dec. 31, 2014 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Warrant Liabilities | $1,910 |
Quote Prices In Active Markets (Level 1) [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Warrant Liabilities | |
Significant Other Observable Inputs (Level 2) [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Warrant Liabilities | |
Significant Other Unobservable inputs (Level 3) [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Warrant Liabilities | $1,910 |
Fair_Value_Measurement_Details1
Fair Value Measurement (Details 1) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Fair Value Measurement [Abstract] | ||
Record warrant liability in August 2014 | $3,037 | |
Decrease in fair value of warrant liability | -1,127 | |
Ending warrant liability as of December 31, 2014 | $1,910 | $3,037 |
Other_Financial_Statement_Info2
Other Financial Statement Information (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Other Financial Statement Information [Abstract] | ||
Finished goods | $531 | $82 |
Work-in-process | 208 | 677 |
Total inventories | $739 | $759 |
Other_Financial_Statement_Info3
Other Financial Statement Information (Details 1) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Other Financial Statement Information [Abstract] | ||
Cash paid for Interest | $18 | $33 |
Cash paid for taxes | ||
Non-cash conversion of borrowings from affiliate to equity | 2,126 | 1,316 |
Leasehold improvements paid for by landlord allowance | $344 |
Goodwill_and_Other_Intangible_2
Goodwill and Other Intangible Assets (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2012 | |
Goodwill and Other Intangible Assets [Abstract] | ||
Goodwill, Begining Balance | $1,362,000 | $1,400 |
Change in 2013 | ||
Merger of Creative and WRT (note 2) | 9,210,000 | |
Goodwill, Ending Balance | $10,572,000 | $1,400 |
Goodwill_and_Other_Intangible_3
Goodwill and Other Intangible Assets (Details 1) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | $5,580 | $300 |
Accumulated amortization | 746 | 180 |
Net book value of amortizable intangible assets | 4,834 | 120 |
Technology-Based Intangible Assets [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 4,190 | |
Accumulated amortization | 374 | |
Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 1,090 | |
Accumulated amortization | 131 | |
Trademarks and Trade Names [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 300 | 300 |
Accumulated amortization | $240 | $180 |
Goodwill_and_Other_Intangible_4
Goodwill and Other Intangible Assets (Details 2) (USD $) | Dec. 31, 2014 |
In Thousands, unless otherwise specified | |
Goodwill and Other Intangible Assets [Abstract] | |
2015 | $1,460 |
2016 | 1,400 |
2017 | 1,268 |
2018 | 681 |
2019 | $35 |
Goodwill_and_Other_Intangible_5
Goodwill and Other Intangible Assets (Details Textual) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Goodwill and Other Intangible Assets [Abstract] | ||
Amortization of Intangible Assets | $566 | $60 |
Loans_Payable_Details
Loans Payable (Details) (JPMorgan Chase Bank (Member), USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Dec. 31, 2013 |
JPMorgan Chase Bank (Member) | |
Related Party Transaction [Line Items] | |
Notes Payable | $316 |
Interest Rate | 5.25% |
Commitments_and_Contingencies_1
Commitments and Contingencies (Details) (Bldg/rent Leases [Member], USD $) | Dec. 31, 2014 |
In Thousands, unless otherwise specified | |
Bldg/rent Leases [Member] | |
Financing Receivable, Impaired [Line Items] | |
2015 | $658 |
2016 | 669 |
2017 | 663 |
2018 | 495 |
2019 | 472 |
Thereafter | 195 |
Total future minimum obligations | $3,154 |
Commitments_and_Contingencies_2
Commitments and Contingencies (Details Textual) (USD $) | 12 Months Ended | 1 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Nov. 30, 2014 |
sqft | |||
Commitments and Contingencies (Textual) | |||
Rent expenses | $690 | $413 | |
Minnetonka [Member] | |||
Commitments and Contingencies (Textual) | |||
Rent expenses | 180 | ||
Area of land | 9,000 | ||
Annual rate per square foot | $11 | ||
Annual increases percentage | 2.50% |
Restructuring_Details
Restructuring (Details) (USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Dec. 31, 2014 |
Restructuring (Texual) | |
Restructuring expenses | $582 |
Accrued expense | $137 |
Related_Party_Transactions_Det
Related Party Transactions (Details) (USD $) | 1 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Jul. 31, 2014 | Dec. 31, 2013 |
Related Party Transactions (Texual) | ||
Shareholder obligation owed | $2,125 | $1,316 |
Income_Taxes_Details
Income Taxes (Details) (USD $) | Dec. 31, 2014 |
In Thousands, unless otherwise specified | |
Deferred tax assets: (liabilities): | |
Reserves | ($72) |
Property and equipment | -4 |
Accrued expenses | 781 |
Severance | 178 |
Non-qualified stock options | 419 |
Net foreign carryforwards | 1,349 |
Net operating loss and credit carryforwards | 5,592 |
Intangibles | 57 |
Total Deferred Tax Assets (includes $7,255 recorded upon merger - Note 2) | 8,300 |
Valuation Allowance (includes 97,255 recorded upon merger - Note 2) | -8,300 |
Net deferred tax assets (liabilities) |
Income_Taxes_Details_1
Income Taxes (Details 1) (USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Dec. 31, 2014 |
Tax Provision Summary | |
Deferred Provision (Benefit) - Federal | ($987) |
Deferred Provision (Benefit) - State | -58 |
Deferred Provision (Benefit) - Foreign | |
Change in valuation allowance | 1,045 |
Tax Expense | $0 |
Income_Taxes_Details_Textual
Income Taxes (Details Textual) (USD $) | 12 Months Ended |
Dec. 31, 2014 | |
Income Taxes (Texual) | |
Merger costs | $7,255,000 |
Federal NOL carryforward | 10,200,000 |
Foreign NOL carryforward | $5,100,000 |
Convertible_Preferred_Stock_an2
Convertible Preferred Stock and Warrants (Details) (USD $) | 12 Months Ended |
Dec. 31, 2014 | |
Warrants (Equity) [Member] | |
Class of Warrant or Right [Line Items] | |
Outstanding debt and equity warrants, Amount | $4,590,576 |
Outstanding debt and equity warrants, Weighted Average Exercise Price | $4.84 |
Outstanding debt and equity warrants, Weighted Average Remaining Contractual Life | 3 years 1 month 2 days |
Warrants (Equity) [Member] | Assumed as part of merger [Member] | |
Class of Warrant or Right [Line Items] | |
Outstanding debt and equity warrants, Amount | 2,811,561 |
Outstanding debt and equity warrants, Weighted Average Exercise Price | $7.60 |
Warrants (Equity) [Member] | Warrants issued to Slipstream, LLC [Member] | |
Class of Warrant or Right [Line Items] | |
Outstanding debt and equity warrants, Amount | 1,779,015 |
Outstanding debt and equity warrants, Weighted Average Exercise Price | $0.48 |
Warrants (Equity) [Member] | August 2014 convertible preferred [Member] | |
Class of Warrant or Right [Line Items] | |
Outstanding debt and equity warrants, Amount | |
Outstanding debt and equity warrants, Weighted Average Exercise Price | |
Outstanding debt and equity warrants, Weighted Average Remaining Contractual Life | 2 years 1 month 10 days |
Warrants (Equity) [Member] | Financial advisor warrants [Member] | |
Class of Warrant or Right [Line Items] | |
Outstanding debt and equity warrants, Amount | |
Outstanding debt and equity warrants, Weighted Average Exercise Price | |
Outstanding debt and equity warrants, Weighted Average Remaining Contractual Life | 4 years 7 months 21 days |
Warrant Liability [Member] | |
Class of Warrant or Right [Line Items] | |
Outstanding debt and equity warrants, Amount | 7,015,125 |
Outstanding debt and equity warrants, Weighted Average Exercise Price | $0.50 |
Outstanding debt and equity warrants, Weighted Average Remaining Contractual Life | 4 years 7 months 21 days |
Warrant Liability [Member] | Assumed as part of merger [Member] | |
Class of Warrant or Right [Line Items] | |
Outstanding debt and equity warrants, Amount | |
Outstanding debt and equity warrants, Weighted Average Exercise Price | |
Warrant Liability [Member] | Warrants issued to Slipstream, LLC [Member] | |
Class of Warrant or Right [Line Items] | |
Outstanding debt and equity warrants, Amount | |
Outstanding debt and equity warrants, Weighted Average Exercise Price | |
Warrant Liability [Member] | August 2014 convertible preferred [Member] | |
Class of Warrant or Right [Line Items] | |
Outstanding debt and equity warrants, Amount | 6,487,500 |
Outstanding debt and equity warrants, Weighted Average Exercise Price | $0.50 |
Outstanding debt and equity warrants, Weighted Average Remaining Contractual Life | 4 years 7 months 21 days |
Warrant Liability [Member] | Financial advisor warrants [Member] | |
Class of Warrant or Right [Line Items] | |
Outstanding debt and equity warrants, Amount | $527,625 |
Outstanding debt and equity warrants, Weighted Average Exercise Price | $0.50 |
Outstanding debt and equity warrants, Weighted Average Remaining Contractual Life | 4 years 8 months 16 days |
Convertible_Preferred_Stock_an3
Convertible Preferred Stock and Warrants (Details Textual) (USD $) | 0 Months Ended | 1 Months Ended | 12 Months Ended | ||||
Aug. 20, 2014 | Aug. 18, 2014 | Aug. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Oct. 10, 2014 | |
Convertible Preferred Stock and Warrants (Textual) | |||||||
Share price | $0.50 | $0.40 | |||||
Proceeds from the issuance of convertible preferred stock | $4,600,000 | ||||||
Fair value of the warrants | -3,000,000 | -1,122,000 | -1,127,000 | ||||
Issuance of warrants to purchase common shares | 6,487,500 | 6,487,000 | 1,300,000 | ||||
Gross proceeds from issuance of preferred stock | 5,200,000 | ||||||
Conversion price | $0.65 | ||||||
Exercise price of warrants | $0.50 | ||||||
Maximum [Member] | |||||||
Convertible Preferred Stock and Warrants (Textual) | |||||||
Expected term | 4 years 7 months 21 days | ||||||
Risk free interest rate | 1.55% | ||||||
Volatility | 102.97% | ||||||
Minimum [Member] | |||||||
Convertible Preferred Stock and Warrants (Textual) | |||||||
Expected term | 3 years 7 months 24 days | ||||||
Risk free interest rate | 1.38% | ||||||
Volatility | 98.00% | ||||||
Creative Realities LLC [Member] | |||||||
Convertible Preferred Stock and Warrants (Textual) | |||||||
Issuance of series A convertible preferred stock | 17,100,000 | ||||||
Issuance of warrants to purchase common shares | 1,800,000 | ||||||
Business combination, purchase price | 1,400,000 | ||||||
Exercise price of warrants | $0.48 | ||||||
Wireless Ronin Technologies Inc [Member] | |||||||
Convertible Preferred Stock and Warrants (Textual) | |||||||
Issuance of warrants to purchase common shares | 2,800,000 | ||||||
Business combination, purchase price | 6,500,000 | ||||||
Exercise price of warrants | $0.50 | ||||||
Wireless Ronin Technologies Inc [Member] | Maximum [Member] | |||||||
Convertible Preferred Stock and Warrants (Textual) | |||||||
Exercise price of warrants | $83.37 | ||||||
Wireless Ronin Technologies Inc [Member] | Minimum [Member] | |||||||
Convertible Preferred Stock and Warrants (Textual) | |||||||
Exercise price of warrants | $0.70 | ||||||
Series A Convertible Preferred Stock [Member] | |||||||
Convertible Preferred Stock and Warrants (Textual) | |||||||
Share price | $0.63 | ||||||
Business acquisition, share price | $1 | ||||||
Preferred stock, dividend rate | 6.00% | ||||||
Convertible preferred stock, Terms of conversion | The convertible preferred stock contains a beneficial conversion feature based on the conversion price of $0.40 per share compared to the price at closing of $0.63 per share. | ||||||
Fair value of the warrants | 1,900,000 | ||||||
Temporary equity | 1,200,000 | ||||||
Issuance of series A convertible preferred stock | 5,190,000 | ||||||
Conversion price | $0.40 | ||||||
Convertible preferred stock beneficial conversion feature | $1,100,000 | $1,100,000 | |||||
Common Stock [Member] | Wireless Ronin Technologies Inc [Member] | |||||||
Convertible Preferred Stock and Warrants (Textual) | |||||||
Issuance of warrants to purchase common shares | 500,000 |
Stockholders_Equity_Details
Stockholders' Equity (Details) (USD $) | 12 Months Ended |
Dec. 31, 2014 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Stock Options Outstanding, Number of shares outstanding | 5,613,977 |
Stock Options Outstanding, Weighted average remaining contractual life | 9 years 3 months 18 days |
Stock Options Outstanding, Weighted average exercise price | $1.45 |
$0.45 - $0.65 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Stock Options Outstanding, Exercise price range, lower limit | $0.45 |
Stock Options Outstanding, Exercise price range, upper limit | $0.65 |
Stock Options Outstanding, Number of shares outstanding | 4,809,318 |
Stock Options Outstanding, Weighted average remaining contractual life | 9 years 7 months 28 days |
Stock Options Outstanding, Weighted average exercise price | $0.46 |
Options exercisable | 350,000 |
Options exercisable, Weighted average exercise price | $0.39 |
$0.66 - $0.79 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Stock Options Outstanding, Exercise price range, lower limit | $0.66 |
Stock Options Outstanding, Exercise price range, upper limit | $0.79 |
Stock Options Outstanding, Number of shares outstanding | 420,000 |
Stock Options Outstanding, Weighted average remaining contractual life | 8 years 5 months 9 days |
Stock Options Outstanding, Weighted average exercise price | $0.74 |
Options exercisable | 420,000 |
Options exercisable, Weighted average exercise price | $0.74 |
$0.80 - $12.25 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Stock Options Outstanding, Exercise price range, lower limit | $0.80 |
Stock Options Outstanding, Exercise price range, upper limit | $12.25 |
Stock Options Outstanding, Number of shares outstanding | 384,659 |
Stock Options Outstanding, Weighted average remaining contractual life | 5 years 9 months 15 days |
Stock Options Outstanding, Weighted average exercise price | $4.73 |
Options exercisable | 384,659 |
Options exercisable, Weighted average exercise price | $5.48 |
Stockholders_Equity_Details_1
Stockholders' Equity (Details 1) (USD $) | 12 Months Ended |
Dec. 31, 2014 | |
Shareholders' Equity [Abstract] | |
Options Outstanding, Beginning balance | |
Options Outstanding, Assumed as part of merger | 1,154,659 |
Options Outstanding, Granted | 4,459,318 |
Options Outstanding, Exercised | |
Options Outstanding, Forfeited or expired | |
Options Outstanding, Ending balance | 5,613,977 |
Weighted Average Exercise Price, Beginning balance | |
Weighted Average Exercise Price, Assumed as part of merger | $5.51 |
Weighted Average Exercise Price, Granted | $0.40 |
Weighted Average Exercise Price, Exercised | |
Weighted Average Exercise Price, Forfeited or expired | |
Weighted Average Exercise Price, Ending balance | $1.45 |
Stockholders_Equity_Details_Te
Stockholders' Equity (Details Textual) (USD $) | 0 Months Ended | 12 Months Ended | |
In Millions, except Share data, unless otherwise specified | Aug. 20, 2014 | Aug. 18, 2014 | Dec. 31, 2014 |
Class of Stock [Line Items] | |||
Exercise price of warrants | $0.50 | ||
Weighted average remaining contractual life | 8 years 4 months 21 days | ||
Issuance of warrants to purchase common shares | 6,487,500 | 6,487,000 | 1,300,000 |
Creative Realities LLC [Member] | |||
Class of Stock [Line Items] | |||
Business combination, purchase price | 1.4 | ||
Exercise price of warrants | 0.48 | ||
Reverse acquisition, Common stock issued and outstanding | 46,200,000 | ||
Issuance of warrants to purchase common shares | 1,800,000 | ||
Wireless Ronin Technologies Inc [Member] | |||
Class of Stock [Line Items] | |||
Business combination, purchase price | 6.5 | ||
Exercise price of warrants | 0.5 | ||
Issuance of warrants to purchase common shares | 2,800,000 | ||
Weighted average exercise price of warrants | 7.6 | ||
Minimum [Member] | Wireless Ronin Technologies Inc [Member] | |||
Class of Stock [Line Items] | |||
Exercise price of warrants | 0.7 | ||
Maximum [Member] | Wireless Ronin Technologies Inc [Member] | |||
Class of Stock [Line Items] | |||
Exercise price of warrants | 83.37 |
StockBased_Compensation_Detail
Stock-Based Compensation (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Total stock-based compensation expenses | $60 | |
Cost of sales [Member] | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Total stock-based compensation expenses | ||
Sales and marketing expenses [Member] | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Total stock-based compensation expenses | 1 | |
Research and development expenses [Member] | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Total stock-based compensation expenses | ||
General and administrative expenses [Member] | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Total stock-based compensation expenses | $59 |
StockBased_Compensation_Detail1
Stock-Based Compensation (Details 1) | 12 Months Ended |
Dec. 31, 2014 | |
Risk-free interest rate | 2.02% |
Expected term | 6 years 3 months |
Expected price volatility | 98.00% |
Dividend yield | 0.00% |
Maximum [Member] | |
Risk-free interest rate | 2.09% |
Expected term | 7 years |
Expected price volatility | 143.00% |
Minimum [Member] | |
Risk-free interest rate | 0.49% |
Expected term | 1 year 3 months 18 days |
Expected price volatility | 98.00% |
StockBased_Compensation_Detail2
Stock-Based Compensation (Details Textual) (USD $) | 0 Months Ended | 12 Months Ended | 1 Months Ended |
Oct. 09, 2014 | Dec. 31, 2014 | Oct. 31, 2014 | |
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items] | |||
Options granted to purchase of common stock | 4,459,318 | ||
Option granted vest in increaments | $25,000 | ||
Share-based compensation award, description | On each of the first four anniversaries of the date of grant, and expire ten years after the date of grant. | ||
Total unrecognized compensation expense related unvested share based awards | $0 | ||
Weighted average fair value of stock options granted | $0.40 | ||
Pre-Vesting Forfeiture Rate | 10.00% | ||
Stock option cancel or expired | |||
2014 Stock Incentive Plan | |||
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items] | |||
Shares reserved for companys employees | 7,390,355 | ||
CEO [Member] | |||
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items] | |||
Options granted to purchase of common stock | 3,753,427 | ||
CFO [Member] | |||
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items] | |||
Options granted to purchase of common stock | 480,685 | ||
Board of directors [Member] | |||
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items] | |||
Options granted to purchase of common stock | 225,206 | ||
Shares reserved for certain employees in the future | 1,096,028 |
ProfitSharing_Plan_Details
Profit-Sharing Plan (Details) | 12 Months Ended |
Dec. 31, 2014 | |
Profit-Sharing Plan [Abstract] | |
Percentage of pretax compensation to the plan | 15.00% |
Segment_Information_and_Signif1
Segment Information and Significant Customers (Details) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Count | Count | |
Entity Wide Revenue Major Customer [Line Items] | ||
Number of reportable segments | 1 | |
Accounts Receivable [Member] | ||
Entity Wide Revenue Major Customer [Line Items] | ||
Percent from major customers | 41.00% | 44.00% |
Number of Major Customers | 2 | 2 |
Revenue [Member] | ||
Entity Wide Revenue Major Customer [Line Items] | ||
Percent from major customers | 53.00% | 54.00% |
Number of Major Customers | 3 | 3 |
Liquidity_Details
Liquidity (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | |||
Liquidity [Abstract] | |||
Cash and cash equivalents | $573 | $108 | $16 |
Working capital deficit | ($1,144) |
Subsequent_Events_Details
Subsequent Events (Details) (USD $) | 1 Months Ended | ||||
Feb. 18, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Dec. 31, 2013 | Apr. 13, 2015 | |
Subsequent Event [Line Items] | |||||
Common stock shares | 46,218,000 | 46,218,000 | 28,547,000 | ||
Board of Directors Chairman [Member] | |||||
Subsequent Event [Line Items] | |||||
Options vested | 938,357 | ||||
Subsequent Event [Member] | Subscription Arrangement [Member] | |||||
Subsequent Event [Line Items] | |||||
Convertible promissory note, principal amount | $175,000 | ||||
Terms of warrant | 5 years | ||||
Series A Convertible Preferred Stock and related warrants | 90,000 | ||||
Warrants, exercise price | $0.50 | ||||
Subsequent Event [Member] | Mill City [Member] | |||||
Subsequent Event [Line Items] | |||||
Convertible promissory note, principal amount | 1,000,000 | ||||
Terms of warrant | 5 years | ||||
Common stock shares | 1,515,152 | ||||
Price per share | $0.38 | ||||
Percentage of convertible promissory note bears interest | 12.00% | ||||
Maturity date | 18-Aug-16 | ||||
Outstanding principal and accrued and unpaid interest at a conversion rate | 0.33% | ||||
Convertible promissory note | $3,500,000 | ||||
Exercise price | $0.49 |