Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2019 | May 14, 2019 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Entity Registrant Name | AUDIOEYE INC | |
Entity Central Index Key | 0001362190 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Trading Symbol | AEYE | |
Entity Common Stock, Shares Outstanding | 7,642,337 | |
Entity Emerging Growth Company | false | |
Entity Small Business | true |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash | $ 4,089,717 | $ 5,741,549 |
Accounts receivable, net | 288,342 | 172,384 |
Marketable securities, held in related party | 492 | 510 |
Deferred costs, short term | 178,781 | 176,006 |
Prepaid expenses and other current assets | 129,388 | 49,901 |
Total current assets | 4,686,720 | 6,140,350 |
Property and equipment, net | 114,387 | 108,007 |
Right of use assets | 512,966 | 0 |
Deferred costs, long term | 105,085 | 93,790 |
Intangible assets, net | 1,961,787 | 2,061,404 |
Goodwill | 700,528 | 700,528 |
Total assets | 8,081,473 | 9,104,079 |
Current liabilities: | ||
Accounts payable and accrued expenses | 340,861 | 93,544 |
Related party payables | 14,467 | 14,467 |
Finance lease liabilities | 37,404 | 30,172 |
Operating lease liabilities | 152,352 | 0 |
Deferred rent | 0 | 4,472 |
Deferred revenue | 2,574,097 | 2,626,712 |
Total current liabilities | 3,119,181 | 2,769,367 |
Long term liabilities: | ||
Finance lease liabilities | 55,165 | 51,150 |
Operating lease liabilities | 371,334 | 0 |
Deferred rent | 0 | 6,585 |
Deferred revenue | 310,967 | 402,075 |
Total liabilities | 3,856,647 | 3,229,177 |
Stockholders' equity: | ||
Preferred stock, value | ||
Common stock, $0.00001 par value, 50,000,000 shares authorized, 7,623,227 and 7,579,995 shares issued and outstanding as of March 31, 2019 and December 31, 2018 | 76 | 76 |
Additional paid-in capital | 48,509,276 | 48,017,926 |
Accumulated deficit | (44,284,527) | (42,143,101) |
Total stockholders' equity | 4,224,826 | 5,874,902 |
Total liabilities and stockholders' equity | 8,081,473 | 9,104,079 |
Series A Preferred Stock [Member] | ||
Stockholders' equity: | ||
Preferred stock, value | $ 1 | $ 1 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2019 | Dec. 31, 2018 |
Preferred Stock, Par or Stated Value Per Share | $ 0.00001 | $ 0.00001 |
Preferred Stock, Shares Authorized | 10,000,000 | 10,000,000 |
Common Stock, Par or Stated Value Per Share | $ 0.00001 | $ 0.00001 |
Common Stock, Shares Authorized | 50,000,000 | 50,000,000 |
Common Stock, Shares, Issued | 7,623,227 | 7,579,995 |
Common Stock, Shares, Outstanding | 7,623,227 | 7,579,995 |
Series A Preferred Stock [Member] | ||
Preferred Stock, Par or Stated Value Per Share | $ 0.00001 | $ 0.00001 |
Preferred Stock, Shares Authorized | 200,000 | 200,000 |
Preferred Stock, Shares Issued | 105,000 | 105,000 |
Preferred Stock, Shares Outstanding | 105,000 | 105,000 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Revenues | $ 1,985,678 | $ 1,149,342 |
Cost of revenue | 902,984 | 587,464 |
Gross profit | 1,082,694 | 561,878 |
Operating expenses: | ||
Selling and marketing | 871,875 | 610,662 |
Research and development | 215,253 | 49,667 |
General and administrative | 2,136,326 | 1,064,625 |
Total operating expenses | 3,223,454 | 1,724,954 |
Operating loss | (2,140,760) | (1,163,076) |
Other income (expense): | ||
Unrealized (loss) gain on marketable securities | (18) | 228 |
Interest income (expense), net | (648) | 237 |
Total other (loss) income | (666) | 465 |
Net loss | (2,141,426) | (1,162,611) |
Dividends on Series A convertible preferred stock | (12,945) | (13,750) |
Net loss available to common stockholders | $ (2,154,371) | $ (1,176,361) |
Net loss per common share-basic and diluted | $ (0.28) | $ (0.18) |
Weighted average common shares outstanding-basic and diluted | 7,611,296 | 6,466,563 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) | Total | Common Stock [Member] | Preferred Stock [Member] | Additional Paid in Capital [Member] | Accumulated Deficit [Member] |
Balance at Dec. 31, 2017 | $ 696,011 | $ 65 | $ 1 | $ 40,121,845 | $ (39,425,900) |
Balance (in shares) at Dec. 31, 2017 | 6,467,066 | 110,000 | |||
New Accounting Pronouncement or Change in Accounting Principle, Cumulative Effect of Change on Equity or Net Assets (Accounting Standards Update 2014-09 [Member]) at Mar. 31, 2018 | 80,153 | 80,153 | |||
New Accounting Pronouncement or Change in Accounting Principle, Cumulative Effect of Change on Equity or Net Assets (Accounting Standards Update 2017-11 [Member]) at Mar. 31, 2018 | 2,984,010 | 761,490 | 2,222,520 | ||
Restricted stock units, warrants and options issued for services | 367,303 | 367,303 | |||
Net loss | (1,162,611) | (1,162,611) | |||
Balance at Mar. 31, 2018 | 2,964,866 | $ 65 | $ 1 | 41,250,638 | (38,285,838) |
Balance (in shares) at Mar. 31, 2018 | 6,467,066 | 110,000 | |||
Balance at Dec. 31, 2018 | 5,874,902 | $ 76 | $ 1 | 48,017,926 | (42,143,101) |
Balance (in shares) at Dec. 31, 2018 | 7,579,995 | 105,000 | |||
New Accounting Pronouncement or Change in Accounting Principle, Cumulative Effect of Change on Equity or Net Assets (Accounting Standards Update 2014-09 [Member]) at Mar. 31, 2019 | 0 | ||||
Common stock issued in exchange for exercise of options and warrants | 42,450 | 42,450 | |||
Common stock issued in exchange for exercise of options and warrants (in shares) | 43,232 | ||||
Restricted stock units, warrants and options issued for services | 448,900 | 448,900 | |||
Net loss | (2,141,426) | (2,141,426) | |||
Balance at Mar. 31, 2019 | $ 4,224,826 | $ 76 | $ 1 | $ 48,509,276 | $ (44,284,527) |
Balance (in shares) at Mar. 31, 2019 | 7,623,227 | 105,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (2,141,426) | $ (1,162,611) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 173,275 | 127,665 |
Option, warrant, RSU and PSU expense | 448,900 | 367,303 |
Unrealized loss (gain) on marketable securities | 18 | (228) |
Amortization of deferred commission | 51,399 | 9,974 |
Noncash operating lease expense | 42,902 | 0 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (115,958) | (31,512) |
Deferred costs | (65,469) | (30,327) |
Other current assets | (79,487) | 18,923 |
Accounts payable and accruals | 247,317 | (25,954) |
Operating lease liabilities | (43,239) | (1,344) |
Deferred revenue | (143,723) | 140,464 |
Related party payables | 0 | (9,068) |
Net cash (used in) operating activities | (1,625,491) | (596,715) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchase of equipment | 0 | (10,893) |
Software development costs | (60,284) | (75,825) |
Net cash (used in) investing activities | (60,284) | (86,718) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from exercise of options and warrants | 42,450 | 0 |
Repayments of notes payable and capital leases | (8,507) | 0 |
Net cash provided by financing activities | 33,943 | 0 |
Net increase in cash | (1,651,832) | (683,433) |
Cash-beginning of period | 5,741,549 | 1,960,430 |
Cash-end of period | 4,089,717 | 1,276,997 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | ||
Interest paid | 1,343 | 0 |
Income taxes paid | 0 | 0 |
Non cash investing and financing activities: | ||
Equipment acquired from capital leases | 19,754 | 0 |
Reclassify fair value of warrant liabilities to equity upon adoption of ASU 2017-11 | 0 | 2,984,010 |
Accounting Standards Update 2014-09 [Member] | ||
Non cash investing and financing activities: | ||
Effect of adoption of ASU 2014-09, Revenue from Contracts with Customers | 0 | 80,153 |
Accounting Standards Update 2016-02 [Member] | ||
Non cash investing and financing activities: | ||
ROU assets and operating lease obligations recognized upon adoption of ASU 2016-02 | $ 568,268 | $ 0 |
ORGANIZATION AND BASIS OF PRESE
ORGANIZATION AND BASIS OF PRESENTATION | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND BASIS OF PRESENTATION | NOTE 1 — ORGANIZATION AND BASIS OF PRESENTATION The accompanying unaudited interim financial statements of AudioEye, Inc. and its wholly-owned subsidiary (together, the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission, and should be read in conjunction with the audited financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018, as filed with the Securities and Exchange Commission on March 27, 2019. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for the interim periods are not necessarily indicative of the results to be expected for the full year. Certain prior period amounts have been reclassified to conform to current period classification. Notes to the financial statements that would substantially duplicate the disclosures contained in the audited financial statements for the year ended December 31, 2018 as reported in the Company’s Annual Report on Form 10-K have been omitted. Corporate Information and Background AudioEye, Inc. (“we”, “our”, the “Company”) was incorporated on May 20, 2005 in the state of Delaware. The Company has developed patented, Internet content publication and distribution software that enables conversion of any media into accessible formats and allows for real time distribution to end users on any Internet connected device. The Company’s focus is to create more comprehensive access to Internet, print, broadcast and other media to all people regardless of their network connection, device, location, or disabilities. The Company is focused on developing innovations in the field of networked and device embedded audio technology. The Company owns a unique patent portfolio comprised of six issued patents in the United States, a notice of allowance from the U.S. Patent and Trademark Office for a seventh patent, and two U.S. patents pending with additional patents being drafted for filing with the U.S. Patent and Trademark Office and internationally. Our common stock has been listed on the NASDAQ Capital Market under the symbol “AEYE” since September 4, 2018. Prior to September 4, 2018, our common stock was quoted on the OTCQB and the OTC Bulletin Board beginning on April 15, 2013 under the same symbol. In August 2018, the Company sold 1,000,000 shares (the “Shares”) of its common stock at $6.25 per share for net proceeds of $5,609,215, after costs and expenses of $640,785 (the “Private Placement”). At the closing of the Private Placement, the Company entered into a registration rights agreement (the “Registration Rights Agreement”) with the investors pursuant to which the Company agreed to register the Shares for resale. On September 4, 2018, the Company filed a registration statement on Form S-1 covering the resale of the securities subject to the Registration Rights Agreement. On August 1, 2018, the Company amended its Certificate of Incorporation to implement a reverse stock split in the ratio of 1 share for every 25 shares Revenue Recognition Revenue is recognized when delivery of the promised goods or services is transferred to the Company’s customers, in an amount that reflects the consideration that the Company expects to be entitled to in exchange for those goods or services. We determine revenue recognition through the following five steps: Identify the contract with the customer; Identify the performance obligations in the contract; Determine the transaction price; Allocate the transaction price to the performance obligations in the contract; and Recognize revenue when, or as, the performance obligations are satisfied. Certain Software as a Service (“SaaS”) invoices are prepared on an annual basis. Any funds received for services not provided yet are held in deferred revenue and are recorded as revenue when earned. Subscription revenue is recognized on a ratable basis over the contractual subscription term of the arrangement beginning on the date that our service is made available to the customer. Payments received in advance of services being rendered are recorded as deferred revenue. Any funds received for services not provided yet are held in deferred revenue and are recorded as revenue when earned. We generate substantially all our revenue from subscription services, which are comprised of subscription fees from customers on the Ally Platform. The following table presents our revenues disaggregated by type of good or service and sales channel: Three months ended March 31, 2019 2018 Subscription revenue and support – Direct $ 1,460,624 $ 945,637 Subscription revenue and support – Indirect (Strategic partners) 525,054 203,705 Total revenues $ 1,985,678 $ 1,149,342 There were significant changes in contract liabilities balances during the quarter ended March 31, 2019. The table below summarizes the activity within the deferred revenue accounts during the quarter ended March 31, 2019: December 31, Cash Revenue March 31, 2018 Received recognized 2019 Deferred revenue $ 3,028,787 $ 1,271,112 $ 1,414,835 $ 2,885,064 As of March 31, 2019, $2,574,097 was classified as short term deferred revenue and is expected to be recognized over the next twelve months following March 31, 2019. The remaining $310,967 is long-term deferred revenue to be recognized thereafter. At March 31, 2019, the Company had one customer representing 23% of the outstanding accounts receivable. At December 31, 2018, the Company had one customer representing 22% of the outstanding accounts receivable. The Company had one major customer (including such customer’s affiliates) which generated approximately 12% and 13% of the Company’s revenue in the three months ended March 31, 2019 and 2018, respectively. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include the fair value of the Company’s stock, stock-based compensation and the valuation allowance related to deferred tax assets. Actual results may differ from these estimates. Stock-Based Compensation The Company measures the cost of services received in exchange for an award of equity instruments based on the fair value of the award. For employees and directors, the fair value of the award is measured on the grant date and for non-employees the fair value of the award is generally re-measured on vesting dates and interim financial reporting dates until the service period is complete. The fair value amount is then recognized over the period during which services are required to be provided in exchange for the award, usually the vesting period. Stock-based compensation expense is recorded by the Company in the same expense classifications in the consolidated statements of operations, as if such amounts were paid in cash. Earnings (Loss) Per Share Basic earnings (loss) per share is calculated by dividing net income (loss) available to common stockholders by the weighted average number of shares of the Company’s common stock outstanding during the period. “Diluted earnings per share” reflects the potential dilution that could occur if our share-based awards and convertible securities were exercised or converted into common stock. The dilutive effect of our share-based awards is computed using the treasury stock method, which assumes all share-based awards are exercised and the hypothetical proceeds from exercise are used to purchase common stock at the average market price during the period. The incremental shares (i.e., the difference between shares assumed to be issued versus purchased), to the extent they would have been dilutive, are included in the denominator of the diluted EPS calculation. The dilutive effect of our convertible preferred stock is computed using the if-converted method, which assumes conversion at the beginning of the year. Potentially dilutive securities excluded from the computation of basic and diluted net earnings (loss) per share for the three months ended March 31, 2019 and 2018 are as follows: 2019 2018 Preferred stock 286,359 287,453 Options to purchase common stock 880,585 1,058,200 Warrants to purchase common stock 1,743,008 1,767,786 Restricted stock units 222,514 156,340 Totals 3,132,466 3,269,779 Fair Value Measurements Fair value is an estimate of the exit price, representing the amount that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants (i.e., the exit price at the measurement date). Fair value measurements are not adjusted for transaction cost. Fair value measurement under generally accepted accounting principles provides for use of a fair value hierarchy that prioritizes inputs to valuation techniques used to measure fair value into three levels: Level 1: Unadjusted quoted prices in active markets for identical assets or liabilities. Level 2: Inputs other than quoted market prices that are observable, either directly or indirectly, and reasonably available. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability and are developed based on market data obtained from sources independent of the Company. Level 3: Unobservable inputs reflect the assumptions that the Company develops based on available information about what market participants would use in valuing the asset or liability. An asset or liability’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Availability of observable inputs can vary and is affected by a variety of factors. The Company uses judgment in determining fair value of assets and liabilities and Level 3 assets and liabilities involve greater judgment than Level 1 and Level 2 assets or liabilities. The Company has no liabilities measured at fair value on a recurring basis as of March 31, 2019 and December 31, 2018. The following are the Company’s assets measured at fair value on a recurring basis as of March 31, 2019 and December 31, 2018: Fair Value Fair Value Hierarchy Assets Marketable securities, March 31, 2019 $ 492 Level 1 Marketable securities, December 31, 2018 $ 510 Level 1 Leases In February 2016, the Financial Accounting Standards Board (“FASB”) established ASC Topic 842, Leases (Topic 842), by issuing ASU No. 2016-02, which requires lessees to recognize leases on the balance sheet and disclose key information about leasing arrangements. Topic 842 was subsequently amended by ASU No. 2018-01, Land Easement Practical Expedient for Transition to Topic 842; ASU No. 2018-10, Codification Improvements to Topic 842, Leases; and ASU No. 2018-11, Targeted Improvements. The new standard establishes a right-of-use (ROU) model that requires a lessee to recognize an ROU asset and lease liability on the balance sheet. Leases are classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the statement of operations. The Company adopted the new standard on January 1, 2019 using the modified-retrospective method, with an effective date or application date of January 1, 2019 and thus did not adjust comparative periods. The new standard provides a number of optional practical expedients in transition. The Company has elected the “package of practical expedients”, which permits it not to reassess under the new standard its prior conclusions about lease identification, lease classification and initial direct costs. The Company did not elect the use-of-hindsight practical expedient. The new standard had a material effect on the Company’s financial statements. The most significant effects of adoption relate to (1) the recognition of new ROU assets and lease liabilities on the Company’s balance sheet for real estate operating leases; and (2) providing significant new disclosures about the Company’s leasing activities. As of January 1, 2019, the Company recognized additional operating lease liabilities of $568,268 based on the present value of the remaining minimum rental payments under current leasing standards for existing operating leases. The Company recognized corresponding ROU assets of $557,212. In February 2019, the Company entered into a new lease in Marietta, Georgia, which will be recognized on the balance sheet upon lease commencement expected to be in June 2019. The new standard also provides practical expedients for an entity’s ongoing accounting. The Company elected the short-term lease recognition exemption for all leases that qualify. This means, for those leases that qualify, the Company does not recognize ROU assets or lease liabilities, and this includes not recognizing ROU assets or lease liabilities for existing short-term leases of those assets in transition. The Company expects changes to its disclosed lease recognition policies and practices, as well as to other related financial statement disclosures due to the adoption of this standard. See Note 6 for these revised disclosures for the first quarter of 2019. Recent Accounting Pronouncements In June 2018, the FASB issued ASU 2018-07, regarding ASC Topic 718 Compensation - Stock Compensation , which largely aligns the accounting for share-based compensation for non-employees with the accounting for share-based compensation for employees. The guidance is effective for annual reporting periods beginning after December 15, 2018, including interim periods within that reporting period. The adoption of this standard did not have a material effect on our consolidated financial statements. There are various other updates recently issued, most of which represented technical corrections to the accounting literature or application to specific industries and are not expected to a have a material impact on the Company's financial position, results of operations or cash flows. |
MANAGEMENT'S LIQUIDITY PLANS
MANAGEMENT'S LIQUIDITY PLANS | 3 Months Ended |
Mar. 31, 2019 | |
Going Concern [Abstract] | |
MANAGEMENT'S LIQUIDITY PLANS | NOTE 2 — MANAGEMENT’S LIQUIDITY PLANS As of March 31, 2019, the Company had cash of $4,089,717 and working capital of $1,567,539. In addition, the Company used actual net cash in operations of $1,625,491 during the quarter ended March 31, 2019. In August 2018, the Company sold 1,000,000 shares of its common stock at $ 6.25 |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 3 Months Ended |
Mar. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | NOTE 3 — PROPERTY AND EQUIPMENT Property and equipment as of March 31, 2019 and December 31, 2018 is summarized as follows: March 31, 2019 December 31, 2018 Computer equipment $ 62,170 $ 62,170 Equipment under finance lease 115,260 95,506 Furniture and fixtures 4,968 4,968 Total 182,398 162,644 Less accumulated depreciation (68,011 ) (54,637 ) Property and equipment, net $ 114,387 $ 108,007 Property and equipment are stated at cost and depreciated using the straight-line method over their estimated useful life of 3 years Included in net property and equipment are assets under finance leases (formerly known as capital leases) of $115,260, less accumulated depreciation of $25,173 as of March 31, 2019 and $95,506, less accumulated depreciation of $16,117 as of December 31, 2018. The Company spent $0 and $10,893 in the purchase of equipment during the three months ended March 31, 2019 and 2018, respectively. The Company also leased $19,754 in equipment during the three months ended March 31, 2019. Depreciation expense was $13,374 and $4,317 for the three months ended March 31, 2019 and 2018, respectively. |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 3 Months Ended |
Mar. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS | NOTE 4 — INTANGIBLE ASSETS For the three months ended March 31, 2019 and 2018, the Company invested in Software development costs in the amounts of $60,284 and $75,825 respectively. Patents, technology and other intangibles with contractual terms are generally amortized over their estimated useful lives of ten years. When certain events or changes in operating conditions occur, an impairment assessment is performed and lives of intangible assets with determinable lives may be adjusted. Software development costs are amortized over their estimated useful life of three years. Intangible assets consisted of the following: March 31, 2019 December 31, 2018 Patents $ 3,697,709 $ 3,697,709 Capitalized software development 1,470,543 1,410,259 Domain name 10,000 10,000 Accumulated amortization (3,216,465 ) (3,056,564 ) Intangible assets, net $ 1,961,787 $ 2,061,404 Amortization expense for patents totaled $93,658 and $87,026 for the three months ended March 31, 2019 and 2018, respectively. Amortization expense for software development totaled $66,243 and $36,322 for the three months ended March 31, 2019 and 2018, respectively. Total amortization expense totaled $159,901 and $123,348 for the three months ended March 31, 2019 and 2018, respectively. |
DEFERRED COSTS
DEFERRED COSTS | 3 Months Ended |
Mar. 31, 2019 | |
Deferred Policy Acquisition Costs Disclosures [Abstract] | |
DEFERRED COSTS | NOTE 5 — DEFERRED COSTS Effective January 1, 2018, the Company capitalizes initial and renewal sales commission payments in the period a customer contract is obtained, and payment is received; and the commissions are amortized consistent with the transfer of the goods or services to the customer over the expected period of benefit, which we have deemed to be the contract term. Such commissions are amortized over the greater of contract term or technological obsolescence period when the underlying contracted products are technology-based, such as for the SaaS-based platforms, or the expected customer relationship period when the underlying contracted products are not technology-based, such as for patient experience survey products. The table below summarizes the activity within the deferred commission costs account, during the three months ended March 31, 2019: December 31, Commission Commission March 31, 2018 Costs Deferred Amortized 2019 Deferred costs, short term $ 176,006 $ 54,174 $ (51,399 ) $ 178,781 Deferred costs, long term 93,790 11,295 - 105,085 Deferred commission costs $ 269,796 $ 65,469 $ (51,399 ) $ 283,866 During the three months ended March 31, 2019, the Company deferred an aggregate of $ 65,469 During the three months ended March 31, 2018, the Company deferred an aggregate of $ 30,327 |
LEASE LIABILITIES AND RIGHT OF
LEASE LIABILITIES AND RIGHT OF USE ASSETS | 3 Months Ended |
Mar. 31, 2019 | |
Leases, Capital [Abstract] | |
LEASE LIABILITIES AND RIGHT OF USE ASSETS | NOTE 6 — LEASE LIABILITIES AND RIGHT OF USE ASSETS Finance Leases March 31, December 31, 2019 2018 Finance equipment lease dated April 5, 2018 $ 11,743 $ 13,056 Finance equipment lease dated May 8, 2018 13,064 14,525 Finance equipment lease dated June 27, 2018 19,674 21,701 Finance equipment lease dated September 18, 2018 14,029 15,368 Finance equipment lease dated September 28, 2018 15,312 16,672 Finance equipment lease dated February 20, 2019 18,747 - Total finance lease liabilities 92,569 81,322 Less current portion (37,404 ) (30,172 ) Long term portion $ 55,165 $ 51,150 During the quarter ended March 31, 2019, the Company entered into a finance lease for computer equipment for a three-year term. The Company recognized this arrangement as a finance lease based on the determination that the lease exceeded 75% of the economic life of the underlying assets. The Company initially recorded the equipment and the finance lease liability at the estimated present value of the minimum lease payments of $19,754. During the year ended December 31, 2018, the Company entered into five finance leases (formerly capital leases) for computer equipment for a three-year term. The Company recognized these arrangements as finance leases based on the determination the leases exceeded 75% of the economic life of the underlying assets. The Company initially recorded the equipment and the finance lease liability at the estimated present value of the minimum lease payments of $95,506. The leases include base monthly payments in the aggregate of $3,495, due on the contract monthly anniversary of each calendar month. At the expiration of the lease, the Company is required to return all leased equipment to the lessor with right of repurchase at fair value. The Company has made payments in the amount of $9,884 during the three months ended March 31, 2019. The effective interest rate of the finance leases is estimated at 6% based on the implicit rate in the lease agreements. The following summarizes the right to use assets under finance leases included in property and equipment: March 31, December 31, 2019 2018 Classes of property Computer equipment $ 115,260 $ 95,506 Less: accumulated depreciation (25,173 ) (16,117 ) $ 90,087 $ 79,389 The following summarizes total future minimum finance lease payments at March 31, 2019: Twelve-month period ending March 31, 2020 $ 41,940 2021 41,940 2022 16,312 Total minimum lease payments 100,192 Amount representing interest 7,623 Present value of minimum lease payments 92,569 Current portion of finance lease obligations 37,404 Finance lease obligations, less current portion $ 55,165 Operating Leases The Company’s principal executive offices are located at 5210 E. Williams Circle, Suite 750, Tucson, Arizona 85711, consisting of approximately 5,151 square feet as of March 31, 2019. The Company’s principal executive office originally consisted of approximately 2,362 square feet and was leased for an aggregate amount of $4,724 per month through September 1, 2016, an aggregate amount of $5,474 per month through September 30, 2017 and an aggregate amount of $ 6,224 The Company also has offices in Atlanta, located at 3901 Roswell Road, Suite 134, leased for an aggregate of $3,937 per month as of December 31, 2017 under a lease expiring on September 30, 2019. On December 29, 2017, effective February 1, 2018, the Company amended its existing lease to expand its Georgia office from approximately 2,739 square feet to approximately 3,831 square feet. Beginning February 1, 2018, the basic rent increased by $1,500 through the remainder of the lease term. In February 2019, the Company entered into a lease for new offices in Marietta, Georgia located at 450 Franklin Gateway, Marietta, Georgia consisting of approximately 9,662 square feet. The new lease will commence, depending on substantial completion of the landlord’s development, no later than June 1, 2019. Beginning in 2017, we leased office space in New York for $300 per $3,578 per month, which continues on a month to month basis as of March 31, 2019. These two properties were considered short-term leases and therefore were not measured under Topic 842. The Company has made operating lease payments in the amount of $68,690 during the three months ended March 31, 2019. Rent expense charged to operations, which differs from rent paid due to rent credits and to increasing amounts of base rent, is calculated by allocating total rental payments on a straight-line basis over the term of the lease. Operating lease liabilities at March 31, 2019 and January 1, 2019 consist of: March 31, January 1, 2019 2019 Tucson Arizona office lease $ 490,090 $ 518,309 Atlanta Georgia office lease 33,596 49,959 Total operating lease liabilities 523,686 568,268 Less current portion (152,352 ) (166,252 ) Long term portion $ 371,334 $ 402,016 As of January 1, 2019, the Company adopted the provisions of ASC Topic 842 using the modified retrospective method. In adopting ASC Topic 842, Leases (Topic 842), the Company has elected the ‘package of practical expedients’, which permit it not to reassess under the new standard its prior conclusions about lease identification, lease classification and initial direct costs. The Company did not elect the use-of-hindsight or the practical expedient pertaining to land easements; the latter is not applicable to the Company. In addition, the Company elected not to apply ASC Topic 842 to arrangements with lease terms of 12 month or less. Effective January 1, 2019, the Company initially recognized operating lease liabilities of $568,268 based on the present value of the remaining minimum rental payments under current leasing standards for existing operating leases. The discount rate utilized in such present value calculation was 6 During the quarter ended March 31, 2019, the Company entered into an operating lease for new office space in Marietta, Georgia, for a five-year term. The following summarizes total future minimum operating lease payments at March 31, 2019: Twelve-month period ending March 31, 2020 $ 179,130 2021 148,042 2022 151,988 2023 90,837 Total minimum lease payments 569,997 Less: present value discount (46,311 ) Present value of minimum lease payments 523,686 Current portion of operating lease obligations 152,352 Operating lease obligations, less current portion $ 371,334 The following summarizes lease expenses for the three months ended March 31, 2019: Finance lease expenses: Depreciation/amortization expense $ 13,374 Interest on lease liabilities 1,343 Finance lease expense 14,717 Operating lease expense 52,548 Short-term lease expense 13,283 Total lease expenses $ 80,548 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Mar. 31, 2019 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 7 — RELATED PARTY TRANSACTIONS As of March 31, 2019, and December 31, 2018, the total balances of related party payable were $14,467 and $14,467, respectively, related to employee paid travel on behalf of the Company. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 3 Months Ended |
Mar. 31, 2019 | |
Stockholders' Equity Attributable to Parent [Abstract] | |
STOCKHOLDERS' EQUITY | NOTE 8 — STOCKHOLDERS’ EQUITY Preferred stock As of March 31, 2019 and December 31, 2018, the Company had 105,000 shares of Series A Convertible Preferred Stock (the “Preferred Stock”), issued at $10 per share, paying a 5% cumulative annual dividend and convertible for common stock at a price of $4.385 per share. For the three months ended March 31, 2019, preferred stockholders earned, but were not paid, $12,945 in annual dividends, or equivalent to 2,952 shares of common stock based on a conversion price of $4.385 per share. As of March 31, 2019 and December 31, 2018, cumulative and unpaid dividends were $205,685 and $192,740, respectively, or equivalent to 46,906 and 43,954 shares of common stock, respectively, based on a conversion price of $4.385 per share, respectively. On any matter presented to the stockholders of the Company, holders of Preferred Stock are entitled to cast the number of votes equal to the number of shares of common stock into which the shares of Preferred Stock are convertible as of the record date to vote on such matter. As long as any shares of Preferred Stock are outstanding, the Company has certain restrictions on share repurchases or amendments to the Certificate of Incorporation in a manner that adversely affects any rights of the Preferred Stock holders. In addition, the preferred stockholders have a liquidation preference for purposes of which the Preferred Stock would be valued at $10 per share plus accrued cumulative annual dividend. At March 31, 2019 and December 31, 2018, the liquidation preference was valued at $1,255,685 and $1,242,740, respectively. In the event of any liquidity event, holders of each share of Preferred Stock shall be entitled to be paid out of the assets of the Company legally available before any sums shall be paid to holders of common stock. Common stock As of March 31, 2019 and December 31, 2018, the Company had 7,623,227 and 7,579,995 shares of common stock issued and outstanding, respectively. In January 2019, the Company issued 20,000 shares of its common stock of the Company upon the exercise of options, for proceeds of $19,000. In January and February 2019, the Company issued 10,000 and 1,395 shares of its common stock, respectively, upon the exercise of outstanding warrants to purchase an aggregate of 11,395 shares of common stock, for aggregate proceeds of $23,450. In January and February 2019, the Company issued an aggregate of 11,837 shares of its common stock upon the cashless exercise of outstanding options and outstanding warrants to purchase 17,733 shares of common stock. Options As of March 31, 2019 and December 31, 2018, the Company had outstanding options to purchase 880,585 and 997,989 shares of common stock, respectively. Weighted Intrinsic Weighted Average Value Number of Average Remaining of Options Exercise Price Term Exercisable Options Outstanding at December 31, 2018 997,989 $ 4.67 2.14 925,545 $ 4,705,220 Granted 28,700 10.55 5.00 - Exercised (32,687 ) 1.43 Forfeited/Expired (113,417 ) 10.28 Outstanding at March 31, 2019 880,585 $ 4.27 2.27 808,057 $ 4,785,984 On February 7, 2019, the Company granted an aggregate of 28,700 incentive stock options to employees newly hired since June 4, 2018. The options to purchase shares of common stock are exercisable at $10.55 per share, have a term of five years, and vest as to 50% of the options at the vesting commencement date, which is generally one year from the date of hire (vesting commencement dates range from June 4, 2019 through January 25, 2020), and vesting as to the remaining 50% of the options, in eight equal quarterly installments commencing on the first day of each calendar quarter following the vesting commencement date and installments continuing on the first day of each of the seven calendar quarters thereafter. All vesting is subject to the employee’s continued service through the vesting date. The exercise price was determined using the closing price of the Company’s common stock on February 7, 2019. The Black-Scholes value on the grant date of the options was $258,392. Option grants during the three months ended March 31, 2019 were valued using the Black-Scholes pricing model. Significant assumptions used in the valuation include expected term of 3.25 3.50 281.65 For the three months ended March 31, 2019 and 2018, total stock compensation expense related to the options totaled $72,274 and $145,046, respectively. The outstanding unamortized stock compensation expense related to options was $293,475 (which will be recognized through December 2021) as of March 31, 2019. Warrants Below is a table summarizing the Company’s outstanding warrants as of March 31, 2019 and December 31, 2018: Weighted Intrinsic Weighted Average Value Number of Average Remaining of Warrants Exercise Price Term Warrants Outstanding at December 31, 2018 1,781,715 $ 4.20 2.23 $ 8,930,058 Granted - Exercised (16,441 ) 2.31 Forfeited/Expired (22,266 ) 2.75 Outstanding at March 31, 2019 1,743,008 $ 4.24 2.02 $ 9,395,841 For the three months ended March 31, 2019 and 2018, the Company incurred warrant-based compensation expense of $0 and $1,393, respectively. There was no outstanding unamortized stock-based compensation expense related to warrants as of March 31, 2019. Restricted stock units (“RSUs”) The following table summarizes the restricted stock unit activity for the three months ended March 31, 2019: Restricted stock units issued as of December 31, 2018 222,514 Granted - Total Restricted stock units issued at March 31, 2019 222,514 Vested at March 31, 2019 167,007 Unvested restricted stock units as of March 31, 2019 55,507 For the three months ended March 31, 2019 and 2018, the Company incurred RSU-based compensation expense of $376,626 and $220,864, respectively. The outstanding unamortized stock-based compensation expense related to RSUs was $111,596 (which will be recognized through April 2019) as of March 31, 2019. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 9 — COMMITMENTS AND CONTINGENCIES Litigation We may become involved in various routine disputes and allegations incidental to our business operations. While it is not possible to determine the ultimate disposition of these matters, our management believes that the resolution of any such matters, should they arise, is not likely to have a material adverse effect on our financial position or results of operations. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2019 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 10 — SUBSEQUENT EVENTS In April 2019, the Company issued 17,120 shares of common stock of the Company upon the exercise of warrants, for aggregate proceeds of $82,292. In April 2019, the Company issued an aggregate of 1,990 shares of common stock upon the cashless exercise of outstanding options and outstanding warrants to purchase an aggregate of 6,400 shares of common stock. |
ORGANIZATION AND BASIS OF PRE_2
ORGANIZATION AND BASIS OF PRESENTATION (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Accounting, Policy [Policy Text Block] | Corporate Information and Background AudioEye, Inc. (“we”, “our”, the “Company”) was incorporated on May 20, 2005 in the state of Delaware. The Company has developed patented, Internet content publication and distribution software that enables conversion of any media into accessible formats and allows for real time distribution to end users on any Internet connected device. The Company’s focus is to create more comprehensive access to Internet, print, broadcast and other media to all people regardless of their network connection, device, location, or disabilities. The Company is focused on developing innovations in the field of networked and device embedded audio technology. The Company owns a unique patent portfolio comprised of six issued patents in the United States, a notice of allowance from the U.S. Patent and Trademark Office for a seventh patent, and two U.S. patents pending with additional patents being drafted for filing with the U.S. Patent and Trademark Office and internationally. Our common stock has been listed on the NASDAQ Capital Market under the symbol “AEYE” since September 4, 2018. Prior to September 4, 2018, our common stock was quoted on the OTCQB and the OTC Bulletin Board beginning on April 15, 2013 under the same symbol. In August 2018, the Company sold 1,000,000 shares (the “Shares”) of its common stock at $6.25 per share for net proceeds of $5,609,215, after costs and expenses of $640,785 (the “Private Placement”). At the closing of the Private Placement, the Company entered into a registration rights agreement (the “Registration Rights Agreement”) with the investors pursuant to which the Company agreed to register the Shares for resale. On September 4, 2018, the Company filed a registration statement on Form S-1 covering the resale of the securities subject to the Registration Rights Agreement. On August 1, 2018, the Company amended its Certificate of Incorporation to implement a reverse stock split in the ratio of 1 share for every 25 shares |
Revenue Recognition, Policy [Policy Text Block] | Revenue Recognition Revenue is recognized when delivery of the promised goods or services is transferred to the Company’s customers, in an amount that reflects the consideration that the Company expects to be entitled to in exchange for those goods or services. We determine revenue recognition through the following five steps: Identify the contract with the customer; Identify the performance obligations in the contract; Determine the transaction price; Allocate the transaction price to the performance obligations in the contract; and Recognize revenue when, or as, the performance obligations are satisfied. Certain Software as a Service (“SaaS”) invoices are prepared on an annual basis. Any funds received for services not provided yet are held in deferred revenue and are recorded as revenue when earned. Subscription revenue is recognized on a ratable basis over the contractual subscription term of the arrangement beginning on the date that our service is made available to the customer. Payments received in advance of services being rendered are recorded as deferred revenue. Any funds received for services not provided yet are held in deferred revenue and are recorded as revenue when earned. We generate substantially all our revenue from subscription services, which are comprised of subscription fees from customers on the Ally Platform. The following table presents our revenues disaggregated by type of good or service and sales channel: Three months ended March 31, 2019 2018 Subscription revenue and support – Direct $ 1,460,624 $ 945,637 Subscription revenue and support – Indirect (Strategic partners) 525,054 203,705 Total revenues $ 1,985,678 $ 1,149,342 There were significant changes in contract liabilities balances during the quarter ended March 31, 2019. The table below summarizes the activity within the deferred revenue accounts during the quarter ended March 31, 2019: December 31, Cash Revenue March 31, 2018 Received recognized 2019 Deferred revenue $ 3,028,787 $ 1,271,112 $ 1,414,835 $ 2,885,064 As of March 31, 2019, $2,574,097 was classified as short term deferred revenue and is expected to be recognized over the next twelve months following March 31, 2019. The remaining $310,967 is long-term deferred revenue to be recognized thereafter. At March 31, 2019, the Company had one customer representing 23% of the outstanding accounts receivable. At December 31, 2018, the Company had one customer representing 22% of the outstanding accounts receivable. The Company had one major customer (including such customer’s affiliates) which generated approximately 12% and 13% of the Company’s revenue in the three months ended March 31, 2019 and 2018, respectively. |
Use of Estimates, Policy [Policy Text Block] | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include the fair value of the Company’s stock, stock-based compensation and the valuation allowance related to deferred tax assets. Actual results may differ from these estimates. |
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] | Stock-Based Compensation The Company measures the cost of services received in exchange for an award of equity instruments based on the fair value of the award. For employees and directors, the fair value of the award is measured on the grant date and for non-employees the fair value of the award is generally re-measured on vesting dates and interim financial reporting dates until the service period is complete. The fair value amount is then recognized over the period during which services are required to be provided in exchange for the award, usually the vesting period. Stock-based compensation expense is recorded by the Company in the same expense classifications in the consolidated statements of operations, as if such amounts were paid in cash. |
Earnings Per Share, Policy [Policy Text Block] | Earnings (Loss) Per Share Basic earnings (loss) per share is calculated by dividing net income (loss) available to common stockholders by the weighted average number of shares of the Company’s common stock outstanding during the period. “Diluted earnings per share” reflects the potential dilution that could occur if our share-based awards and convertible securities were exercised or converted into common stock. The dilutive effect of our share-based awards is computed using the treasury stock method, which assumes all share-based awards are exercised and the hypothetical proceeds from exercise are used to purchase common stock at the average market price during the period. The incremental shares (i.e., the difference between shares assumed to be issued versus purchased), to the extent they would have been dilutive, are included in the denominator of the diluted EPS calculation. The dilutive effect of our convertible preferred stock is computed using the if-converted method, which assumes conversion at the beginning of the year. Potentially dilutive securities excluded from the computation of basic and diluted net earnings (loss) per share for the three months ended March 31, 2019 and 2018 are as follows: 2019 2018 Preferred stock 286,359 287,453 Options to purchase common stock 880,585 1,058,200 Warrants to purchase common stock 1,743,008 1,767,786 Restricted stock units 222,514 156,340 Totals 3,132,466 3,269,779 |
Fair Value Measurement, Policy [Policy Text Block] | Fair Value Measurements Fair value is an estimate of the exit price, representing the amount that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants (i.e., the exit price at the measurement date). Fair value measurements are not adjusted for transaction cost. Fair value measurement under generally accepted accounting principles provides for use of a fair value hierarchy that prioritizes inputs to valuation techniques used to measure fair value into three levels: Level 1: Unadjusted quoted prices in active markets for identical assets or liabilities. Level 2: Inputs other than quoted market prices that are observable, either directly or indirectly, and reasonably available. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability and are developed based on market data obtained from sources independent of the Company. Level 3: Unobservable inputs reflect the assumptions that the Company develops based on available information about what market participants would use in valuing the asset or liability. An asset or liability’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Availability of observable inputs can vary and is affected by a variety of factors. The Company uses judgment in determining fair value of assets and liabilities and Level 3 assets and liabilities involve greater judgment than Level 1 and Level 2 assets or liabilities. The Company has no liabilities measured at fair value on a recurring basis as of March 31, 2019 and December 31, 2018. The following are the Company’s assets measured at fair value on a recurring basis as of March 31, 2019 and December 31, 2018: Fair Value Fair Value Hierarchy Assets Marketable securities, March 31, 2019 $ 492 Level 1 Marketable securities, December 31, 2018 $ 510 Level 1 |
Lessee, Leases [Policy Text Block] | Leases In February 2016, the Financial Accounting Standards Board (“FASB”) established ASC Topic 842, Leases (Topic 842), by issuing ASU No. 2016-02, which requires lessees to recognize leases on the balance sheet and disclose key information about leasing arrangements. Topic 842 was subsequently amended by ASU No. 2018-01, Land Easement Practical Expedient for Transition to Topic 842; ASU No. 2018-10, Codification Improvements to Topic 842, Leases; and ASU No. 2018-11, Targeted Improvements. The new standard establishes a right-of-use (ROU) model that requires a lessee to recognize an ROU asset and lease liability on the balance sheet. Leases are classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the statement of operations. The Company adopted the new standard on January 1, 2019 using the modified-retrospective method, with an effective date or application date of January 1, 2019 and thus did not adjust comparative periods. The new standard provides a number of optional practical expedients in transition. The Company has elected the “package of practical expedients”, which permits it not to reassess under the new standard its prior conclusions about lease identification, lease classification and initial direct costs. The Company did not elect the use-of-hindsight practical expedient. The new standard had a material effect on the Company’s financial statements. The most significant effects of adoption relate to (1) the recognition of new ROU assets and lease liabilities on the Company’s balance sheet for real estate operating leases; and (2) providing significant new disclosures about the Company’s leasing activities. As of January 1, 2019, the Company recognized additional operating lease liabilities of $568,268 based on the present value of the remaining minimum rental payments under current leasing standards for existing operating leases. The Company recognized corresponding ROU assets of $557,212. In February 2019, the Company entered into a new lease in Marietta, Georgia, which will be recognized on the balance sheet upon lease commencement expected to be in June 2019. The new standard also provides practical expedients for an entity’s ongoing accounting. The Company elected the short-term lease recognition exemption for all leases that qualify. This means, for those leases that qualify, the Company does not recognize ROU assets or lease liabilities, and this includes not recognizing ROU assets or lease liabilities for existing short-term leases of those assets in transition. The Company expects changes to its disclosed lease recognition policies and practices, as well as to other related financial statement disclosures due to the adoption of this standard. See Note 6 for these revised disclosures for the first quarter of 2019. |
New Accounting Pronouncements, Policy [Policy Text Block] | Recent Accounting Pronouncements In June 2018, the FASB issued ASU 2018-07, regarding ASC Topic 718 Compensation - Stock Compensation , which largely aligns the accounting for share-based compensation for non-employees with the accounting for share-based compensation for employees. The guidance is effective for annual reporting periods beginning after December 15, 2018, including interim periods within that reporting period. The adoption of this standard did not have a material effect on our consolidated financial statements. There are various other updates recently issued, most of which represented technical corrections to the accounting literature or application to specific industries and are not expected to a have a material impact on the Company's financial position, results of operations or cash flows. |
ORGANIZATION AND BASIS OF PRE_3
ORGANIZATION AND BASIS OF PRESENTATION (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Disaggregation of Revenue [Table Text Block] | The following table presents our revenues disaggregated by type of good or service and sales channel: Three months ended March 31, 2019 2018 Subscription revenue and support – Direct $ 1,460,624 $ 945,637 Subscription revenue and support – Indirect (Strategic partners) 525,054 203,705 Total revenues $ 1,985,678 $ 1,149,342 |
Deferred Revenue, by Arrangement, Disclosure [Table Text Block] | There were significant changes in contract liabilities balances during the quarter ended March 31, 2019. The table below summarizes the activity within the deferred revenue accounts during the quarter ended March 31, 2019: December 31, Cash Revenue March 31, 2018 Received recognized 2019 Deferred revenue $ 3,028,787 $ 1,271,112 $ 1,414,835 $ 2,885,064 |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block] | Potentially dilutive securities excluded from the computation of basic and diluted net earnings (loss) per share for the three months ended March 31, 2019 and 2018 are as follows: 2019 2018 Preferred stock 286,359 287,453 Options to purchase common stock 880,585 1,058,200 Warrants to purchase common stock 1,743,008 1,767,786 Restricted stock units 222,514 156,340 Totals 3,132,466 3,269,779 |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block] | The following are the Company’s assets measured at fair value on a recurring basis as of March 31, 2019 and December 31, 2018: Fair Value Fair Value Hierarchy Assets Marketable securities, March 31, 2019 $ 492 Level 1 Marketable securities, December 31, 2018 $ 510 Level 1 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment [Table Text Block] | Property and equipment as of March 31, 2019 and December 31, 2018 is summarized as follows: March 31, 2019 December 31, 2018 Computer equipment $ 62,170 $ 62,170 Equipment under finance lease 115,260 95,506 Furniture and fixtures 4,968 4,968 Total 182,398 162,644 Less accumulated depreciation (68,011 ) (54,637 ) Property and equipment, net $ 114,387 $ 108,007 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Finite-Lived Intangible Assets [Table Text Block] | Intangible assets consisted of the following: March 31, 2019 December 31, 2018 Patents $ 3,697,709 $ 3,697,709 Capitalized software development 1,470,543 1,410,259 Domain name 10,000 10,000 Accumulated amortization (3,216,465 ) (3,056,564 ) Intangible assets, net $ 1,961,787 $ 2,061,404 |
DEFERRED COSTS (Tables)
DEFERRED COSTS (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Deferred Policy Acquisition Costs Disclosures [Abstract] | |
Deferred Policy Acquisition Costs [Table Text Block] | The table below summarizes the activity within the deferred commission costs account, during the three months ended March 31, 2019: December 31, Commission Commission March 31, 2018 Costs Deferred Amortized 2019 Deferred costs, short term $ 176,006 $ 54,174 $ (51,399 ) $ 178,781 Deferred costs, long term 93,790 11,295 - 105,085 Deferred commission costs $ 269,796 $ 65,469 $ (51,399 ) $ 283,866 |
LEASE LIABILITIES AND RIGHT O_2
LEASE LIABILITIES AND RIGHT OF USE ASSETS (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Leases, Capital [Abstract] | |
Schedule of Capital Lease Obligations [Table Text Block] | March 31, December 31, 2019 2018 Finance equipment lease dated April 5, 2018 $ 11,743 $ 13,056 Finance equipment lease dated May 8, 2018 13,064 14,525 Finance equipment lease dated June 27, 2018 19,674 21,701 Finance equipment lease dated September 18, 2018 14,029 15,368 Finance equipment lease dated September 28, 2018 15,312 16,672 Finance equipment lease dated February 20, 2019 18,747 - Total finance lease liabilities 92,569 81,322 Less current portion (37,404 ) (30,172 ) Long term portion $ 55,165 $ 51,150 |
Schedule of Capital Leased Assets [Table Text Block] | The following summarizes the right to use assets under finance leases included in property and equipment: March 31, December 31, 2019 2018 Classes of property Computer equipment $ 115,260 $ 95,506 Less: accumulated depreciation (25,173 ) (16,117 ) $ 90,087 $ 79,389 |
Schedule of Future Minimum Lease Payments for Capital Leases [Table Text Block] | The following summarizes total future minimum finance lease payments at March 31, 2019: Twelve-month period ending March 31, 2020 $ 41,940 2021 41,940 2022 16,312 Total minimum lease payments 100,192 Amount representing interest 7,623 Present value of minimum lease payments 92,569 Current portion of finance lease obligations 37,404 Finance lease obligations, less current portion $ 55,165 |
Schedule Of Allocation Of Total Rental Payments [Table Text Block] | Operating lease liabilities at March 31, 2019 and January 1, 2019 consist of: March 31, January 1, 2019 2019 Tucson Arizona office lease $ 490,090 $ 518,309 Atlanta Georgia office lease 33,596 49,959 Total operating lease liabilities 523,686 568,268 Less current portion (152,352 ) (166,252 ) Long term portion $ 371,334 $ 402,016 |
Schedule Of Future Minimum Lease Payments For Operating Leases [Table Text Block] | Twelve-month period ending March 31, 2020 $ 179,130 2021 148,042 2022 151,988 2023 90,837 Total minimum lease payments 569,997 Less: present value discount (46,311 ) Present value of minimum lease payments 523,686 Current portion of operating lease obligations 152,352 Operating lease obligations, less current portion $ 371,334 |
Schedule Of Lease Expense [Table Text Block] | The following summarizes lease expenses for the three months ended March 31, 2019: Finance lease expenses: Depreciation/amortization expense $ 13,374 Interest on lease liabilities 1,343 Finance lease expense 14,717 Operating lease expense 52,548 Short-term lease expense 13,283 Total lease expenses $ 80,548 |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Stockholders' Equity Attributable to Parent [Abstract] | |
Schedule of Share-based Compensation, Stock Options, Activity [Table Text Block] | As of March 31, 2019 and December 31, 2018, the Company had outstanding options to purchase 880,585 and 997,989 shares of common stock, respectively. Weighted Intrinsic Weighted Average Value Number of Average Remaining of Options Exercise Price Term Exercisable Options Outstanding at December 31, 2018 997,989 $ 4.67 2.14 925,545 $ 4,705,220 Granted 28,700 10.55 5.00 - Exercised (32,687 ) 1.43 Forfeited/Expired (113,417 ) 10.28 Outstanding at March 31, 2019 880,585 $ 4.27 2.27 808,057 $ 4,785,984 |
Schedule of Other Share-based Compensation, Activity [Table Text Block] | Below is a table summarizing the Company’s outstanding warrants as of March 31, 2019 and December 31, 2018: Weighted Intrinsic Weighted Average Value Number of Average Remaining of Warrants Exercise Price Term Warrants Outstanding at December 31, 2018 1,781,715 $ 4.20 2.23 $ 8,930,058 Granted - Exercised (16,441 ) 2.31 Forfeited/Expired (22,266 ) 2.75 Outstanding at March 31, 2019 1,743,008 $ 4.24 2.02 $ 9,395,841 |
Nonvested Restricted Stock Shares Activity [Table Text Block] | The following table summarizes the restricted stock unit activity for the three months ended March 31, 2019: Restricted stock units issued as of December 31, 2018 222,514 Granted - Total Restricted stock units issued at March 31, 2019 222,514 Vested at March 31, 2019 167,007 Unvested restricted stock units as of March 31, 2019 55,507 |
ORGANIZATION AND BASIS OF PRE_4
ORGANIZATION AND BASIS OF PRESENTATION (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Subscription revenue and support – Direct | $ 1,460,624 | $ 945,637 |
Subscription revenue and support – Indirect (Strategic partners) | 525,054 | 203,705 |
Total revenues | $ 1,985,678 | $ 1,149,342 |
ORGANIZATION AND BASIS OF PRE_5
ORGANIZATION AND BASIS OF PRESENTATION (Details 1) | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Deferred revenue | $ 3,028,787 |
Cash received | 1,271,112 |
Revenue recognized | 1,414,835 |
Deferred revenue | $ 2,885,064 |
ORGANIZATION AND BASIS OF PRE_6
ORGANIZATION AND BASIS OF PRESENTATION (Details2) - shares | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 3,132,466 | 3,269,779 |
Antidilutive Securities preferred Stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 286,359 | 287,453 |
Employee Stock Option [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 880,585 | 1,058,200 |
Warrant [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 1,743,008 | 1,767,786 |
Restricted Stock Units (RSUs) [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 222,514 | 156,340 |
ORGANIZATION AND BASIS OF PRE_7
ORGANIZATION AND BASIS OF PRESENTATION (Details 3) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities held in related party | $ 492 | $ 510 |
Fair Value, Inputs, Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities held in related party | $ 492 | |
Fair Value, Inputs, Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities held in related party | $ 510 |
ORGANIZATION AND BASIS OF PRE_8
ORGANIZATION AND BASIS OF PRESENTATION (Details Textual) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Aug. 31, 2018 | Aug. 01, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | Jan. 01, 2019 | |
Organization Consolidation And Presentation Of Financial Statements Line Items [Line Items] | ||||||
Stock Issued During Period, Shares, New Issues | 1,000,000 | |||||
Shares Issued, Price Per Share | $ 6.25 | |||||
Proceeds from Issuance of Common Stock | $ 5,609,215 | |||||
Payments of Stock Issuance Costs | $ 640,785 | |||||
Stockholders' Equity Note, Stock Split | 1 share for every 25 shares | |||||
Common Stock, Shares Authorized | 50,000,000 | 50,000,000 | 50,000,000 | |||
Conversion of Stock, Shares Converted | 186,994,384 | |||||
Conversion of Stock, Shares Issued | 7,479,775 | |||||
Deferred Revenue, Current | $ 2,574,097 | $ 2,626,712 | ||||
Deferred Revenue, Noncurrent | 310,967 | 402,075 | ||||
Operating Lease Liability | 523,686 | $ 568,268 | ||||
Operating Lease, Right-of-Use Asset | $ 512,966 | $ 0 | $ 557,212 | |||
Sales Revenue, Net [Member] | Customer Concentration Risk [Member] | ||||||
Organization Consolidation And Presentation Of Financial Statements Line Items [Line Items] | ||||||
Concentration Risk, Percentage | 12.00% | 13.00% | ||||
Accounts Receivable [Member] | Major Customer Number Two [Member] | ||||||
Organization Consolidation And Presentation Of Financial Statements Line Items [Line Items] | ||||||
Concentration Risk, Percentage | 22.00% | |||||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | ||||||
Organization Consolidation And Presentation Of Financial Statements Line Items [Line Items] | ||||||
Concentration Risk, Percentage | 23.00% | |||||
Previously Reported [Member] | ||||||
Organization Consolidation And Presentation Of Financial Statements Line Items [Line Items] | ||||||
Common Stock, Shares Authorized | 250,000,000 |
MANAGEMENT'S LIQUIDITY PLANS (D
MANAGEMENT'S LIQUIDITY PLANS (Details Textual) - USD ($) | 1 Months Ended | 3 Months Ended | ||||
Oct. 31, 2018 | Sep. 30, 2018 | Aug. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Going Concern And Management Liquidity Plans [Line Items] | ||||||
Working Capital Deficit | $ 1,567,539 | |||||
Cash | 4,089,717 | $ 5,741,549 | ||||
Net Cash Provided by (Used in) Operating Activities | (1,625,491) | $ (596,715) | ||||
Stock Issued During Period, Shares, New Issues | 1,000,000 | |||||
Payments of Stock Issuance Costs | $ 640,785 | |||||
Shares Issued, Price Per Share | $ 6.25 | |||||
Proceeds from Issuance of Common Stock | $ 5,609,215 | |||||
Payments of Costs Related to Common Stock Subscriptions | $ 124,975 | |||||
Convertible Notes Payable [Member] | ||||||
Going Concern And Management Liquidity Plans [Line Items] | ||||||
Net Cash Provided by (Used in) Operating Activities | $ 1,625,491 | |||||
Proceeds from Common Stock Subscriptions | $ 100,000 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment gross | $ 182,398 | $ 162,644 |
Less accumulated depreciation | (68,011) | (54,637) |
Property and equipment, net | 114,387 | 108,007 |
Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment gross | 62,170 | 62,170 |
Equipment under capital lease [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment gross | 115,260 | 95,506 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment gross | $ 4,968 | $ 4,968 |
PROPERTY AND EQUIPMENT (Detai_2
PROPERTY AND EQUIPMENT (Details Textual) - USD ($) | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Property, Plant and Equipment [Line Items] | |||
Depreciation | $ 13,374 | $ 4,317 | |
Payments to Acquire Property, Plant, and Equipment | $ 0 | 10,893 | |
Property, Plant and Equipment, Estimated Useful Lives | 3 years | ||
Property, Plant and Equipment, Gross | $ 182,398 | $ 162,644 | |
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | 68,011 | 54,637 | |
Noncash or Part Noncash Acquisition, Fixed Assets Acquired | 19,754 | $ 0 | |
Assets Held under Capital Leases [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 115,260 | 95,506 | |
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | $ 25,173 | $ 16,117 |
INTANGIBLE ASSETS (Details)
INTANGIBLE ASSETS (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Intangible Assets | ||
Accumulated amortization | $ (3,216,465) | $ (3,056,564) |
Intangible assets, net | 1,961,787 | 2,061,404 |
Patents [Member] | ||
Intangible Assets | ||
Finite-Lived Intangible Assets, Gross | 3,697,709 | 3,697,709 |
Capitalized software development [Member] | ||
Intangible Assets | ||
Finite-Lived Intangible Assets, Gross | 1,470,543 | 1,410,259 |
Domain Name [Member] | ||
Intangible Assets | ||
Finite-Lived Intangible Assets, Gross | $ 10,000 | $ 10,000 |
INTANGIBLE ASSETS (Details Text
INTANGIBLE ASSETS (Details Textual) - USD ($) | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Software Development [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Assets, Gross | $ 159,901 | $ 123,348 | |
Amortization of Intangible Assets | 66,243 | 36,322 | |
Finite-lived Intangible Assets Acquired | 60,284 | 75,825 | |
Patents [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Assets, Gross | 3,697,709 | $ 3,697,709 | |
Amortization of Intangible Assets | $ 93,658 | $ 87,026 |
DEFERRED COSTS (Details)
DEFERRED COSTS (Details) | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Deferred costs, short term - Beginning balance | $ 176,006 |
Deferred costs, long term - Beginning balance | 93,790 |
Deferred costs, short term - End balance | 178,781 |
Deferred costs, long term - End balance | 105,085 |
Accounting Standards Update 2014-09 [Member] | |
Deferred costs, long term - Beginning balance | 93,790 |
Deferred commission costs - Beginning balance | 269,796 |
Commission Costs Deferred, short term | 54,174 |
Commission Costs Deferred, long term | 11,295 |
Commission Costs Deferred | 65,469 |
Commission Amortized, Short term | (51,399) |
Commission Amortized, Long term | 0 |
Commission Amortized | (51,399) |
Deferred costs, short term - End balance | 178,781 |
Deferred costs, long term - End balance | 105,085 |
Deferred commission costs - End balance | $ 283,866 |
DEFERRED COSTS (Details Textual
DEFERRED COSTS (Details Textual) - USD ($) | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2017 | |
Increase (Decrease) in Deferred Charges | $ 65,469 | $ 30,327 | |
Amortization of Deferred Charges | 51,399 | 9,974 | |
Accounting Standards Update 2014-09 [Member] | |||
New Accounting Pronouncement or Change in Accounting Principle, Cumulative Effect of Change on Equity or Net Assets | $ 0 | $ 80,153 | $ 80,153 |
LEASE LIABILITIES AND RIGHT O_3
LEASE LIABILITIES AND RIGHT OF USE ASSETS (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Total finance lease liabilities | $ 92,569 | $ 81,322 |
Less current portion | (37,404) | (30,172) |
Long term portion | 55,165 | 51,150 |
Finance equipment lease dated April 5, 2018 [Member] | ||
Total finance lease liabilities | 11,743 | 13,056 |
Finance equipment lease dated May 8, 2018 [Member] | ||
Total finance lease liabilities | 13,064 | 14,525 |
Finance equipment lease dated June 27, 2018 [Member] | ||
Total finance lease liabilities | 19,674 | 21,701 |
Finance equipment lease dated September 18, 2018 [Member] | ||
Total finance lease liabilities | 14,029 | 15,368 |
Finance equipment lease dated September 28, 2018 [Member] | ||
Total finance lease liabilities | 15,312 | 16,672 |
Finance equipment lease dated February 20, 2019 [Member] | ||
Total finance lease liabilities | $ 18,747 | $ 0 |
LEASE LIABILITIES AND RIGHT O_4
LEASE LIABILITIES AND RIGHT OF USE ASSETS (Details 1) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Classes of property | ||
Computer equipment | $ 19,754 | $ 95,506 |
Computer Equipment [Member] | ||
Classes of property | ||
Computer equipment | 115,260 | 95,506 |
Less: accumulated depreciation | (25,173) | (16,117) |
Capital Leases, Balance Sheet, Assets by Major Class, Net | $ 90,087 | $ 79,389 |
LEASE LIABILITIES AND RIGHT O_5
LEASE LIABILITIES AND RIGHT OF USE ASSETS (Details 2) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
2020 | $ 41,940 | |
2021 | 41,940 | |
2022 | 16,312 | |
Total minimum lease payments | 100,192 | |
Present value of minimum lease payments | 7,623 | |
Present value of minimum lease payments | 92,569 | |
Current portion of capital lease obligations | 37,404 | $ 30,172 |
Finance lease obligations, less current portion | $ 55,165 | $ 51,150 |
LEASE LIABILITIES AND RIGHT O_6
LEASE LIABILITIES AND RIGHT OF USE ASSETS (Details 3) - USD ($) | Mar. 31, 2019 | Jan. 01, 2019 | Sep. 30, 2018 | Dec. 31, 2018 |
Operating Leases, Rent Expense | $ 1,500 | $ 300 | ||
Total operating lease liabilities | $ 523,686 | 568,268 | ||
Less current portion | (152,352) | (166,252) | $ 0 | |
Long term portion | 371,334 | 402,016 | $ 0 | |
Tucson Arizona office lease [Member] | ||||
Operating Leases, Rent Expense | 490,090 | 518,309 | ||
Atlanta georgia [Member] | ||||
Operating Leases, Rent Expense | $ 33,596 | $ 49,959 |
LEASE LIABILITIES AND RIGHT O_7
LEASE LIABILITIES AND RIGHT OF USE ASSETS (Details 4) - USD ($) | Mar. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
2020 | $ 179,130 | ||
2021 | 148,042 | ||
2022 | 151,988 | ||
2023 | 90,837 | ||
Total minimum lease payments | 569,997 | ||
Less: present value discount | (46,311) | ||
Present value of minimum lease payments | 523,686 | $ 568,268 | |
Current portion of operating lease obligations | 152,352 | 166,252 | $ 0 |
Operating lease obligations, less current portion | $ 371,334 | $ 402,016 | $ 0 |
LEASE LIABILITIES AND RIGHT O_8
LEASE LIABILITIES AND RIGHT OF USE ASSETS (Details 5) | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Finance lease expenses: | |
Depreciation/amortization expense | $ 13,374 |
Interest on lease liabilities | 1,343 |
Finance lease expense | 14,717 |
Operating lease expense | 52,548 |
Short-term lease expense | 13,283 |
Total lease expenses | $ 80,548 |
LEASE LIABILITIES AND RIGHT O_9
LEASE LIABILITIES AND RIGHT OF USE ASSETS (Details Textual) | Oct. 31, 2022USD ($) | Mar. 31, 2019USD ($)ft² | Jan. 01, 2019USD ($) | Feb. 01, 2018USD ($)ft² | Dec. 31, 2017USD ($) | Jan. 31, 2018USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Mar. 31, 2019USD ($)ft² | Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Dec. 01, 2018ft² |
Lessee Capital Lease Term of Contract | 3 years | 3 years | ||||||||||
Capital Leased Assets, Gross | $ 19,754 | $ 19,754 | $ 95,506 | |||||||||
Interest Expense, Lessee, Assets under Capital Lease | $ 3,495 | |||||||||||
Debt Instrument, Interest Rate, Effective Percentage | 6.00% | 6.00% | ||||||||||
Finance Lease, Principal Payments | $ 9,884 | |||||||||||
Operating Lease, Payments | $ 568,268 | 68,690 | ||||||||||
Operating Lease, Right-of-Use Asset | $ 512,966 | 557,212 | 512,966 | 0 | ||||||||
Deferred Rent Credit, Noncurrent | $ 0 | 11,056 | $ 0 | $ 6,585 | ||||||||
Percentage of finance lease exceeding | 75.00% | |||||||||||
Area of Land | ft² | 5,151 | 4,248 | 5,151 | 5,151 | ||||||||
Operating Leases Rent Expense Net | $ 3,578 | $ 3,937 | $ 6,224 | $ 5,474 | $ 4,724 | |||||||
Increase Lease And Rental Expense | $ 12,977 | $ 850 | 11,810 | $ 9,598 | ||||||||
Operating Leases, Rent Expense | $ 1,500 | $ 300 | ||||||||||
Lessee, Operating Lease, Discount Rate | 6.00% | |||||||||||
Arizona [Member] | ||||||||||||
Area of Land | ft² | 2,362 | 2,362 | ||||||||||
Georgia [Member] | Minimum [Member] | ||||||||||||
Area of Land | ft² | 2,739 | |||||||||||
Georgia [Member] | Maximum [Member] | ||||||||||||
Area of Land | ft² | 3,831 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Textual) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Due to Related Parties | $ 14,467 | $ 14,467 |
STOCKHOLDERS' EQUITY (Details)
STOCKHOLDERS' EQUITY (Details) - USD ($) | Feb. 07, 2019 | Jan. 31, 2019 | Feb. 28, 2019 | Mar. 31, 2019 | Dec. 31, 2018 |
Number of Options | |||||
Outstanding at beginning of the period (in shares) | 997,989 | 997,989 | 997,989 | ||
Granted (in shares) | 28,700 | 258,392 | |||
Exercised (shares) | (20,000) | (11,837) | |||
Outstanding at the end of the period (in shares) | 880,585 | 997,989 | |||
Employee Stock Option | |||||
Number of Options | |||||
Outstanding at beginning of the period (in shares) | 997,989 | 997,989 | 997,989 | ||
Granted (in shares) | 28,700 | ||||
Exercised (shares) | (32,687) | ||||
Forfeited/Expired | (113,417) | ||||
Outstanding at the end of the period (in shares) | 880,585 | 997,989 | |||
Exercisable (in shares) | 808,057 | 925,545 | |||
Wtd Avg. Exercise Price | |||||
Outstanding at beginning of the period (in dollars per share) | $ 4.67 | $ 4.67 | $ 4.67 | ||
Granted (in dollars per share) | 10.55 | ||||
Exercised (in dollars per share) | 1.43 | ||||
Forfeited/Expired | 10.28 | ||||
Outstanding at end of the period (in dollars per share) | $ 4.27 | $ 4.67 | |||
Wtd Avg. Remaining Term | |||||
Granted Weighted Average Remaining Term | 5 years | ||||
Outstanding, Wtd Average Remaining Term | 2 years 3 months 7 days | 2 years 1 month 20 days | |||
Intrinsic Value of Options | |||||
Granted, Intrinsic Value of Exercisable Options | $ 0 | ||||
Outstanding, Intrinsic Value (in dollars) | $ 4,785,984 | $ 4,705,220 |
STOCKHOLDERS' EQUITY (Details
STOCKHOLDERS' EQUITY (Details 1) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2016 | Dec. 31, 2017 | |
Wtd Avg. Exercise Price | ||||
Oustanding (in dollars per share) | $ 4.24 | |||
Wtd Avg. Remaining Term | ||||
Oustanding | 2 years 7 days | 2 years 2 months 23 days | ||
Warrant | ||||
Number of warrants | ||||
Number of shares, Beginning | 1,781,715 | |||
Number of shares, granted | 0 | |||
Number of shares, exercised | (16,441) | |||
Number of shares, Forfeited | (22,266) | |||
Number of shares, Ending | 1,743,008 | |||
Wtd Avg. Exercise Price | ||||
Oustanding (in dollars per share) | $ 4.20 | |||
Exercised (in dollars per share) | $ 2.31 | |||
Forfeited (in dollars per share) | $ 2.75 | |||
Intrinsic Value of Warrants | ||||
Outstanding | $ 8,930,058 | $ 9,395,841 |
STOCKHOLDERS' EQUITY (Detail_2
STOCKHOLDERS' EQUITY (Details 2) - Restricted Stock Units (RSUs) [Member] - shares | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Restricted stock units issued as of December 31, 2018 | 222,514 | |
Granted | 0 | |
Total Restricted stock units issued at March 31, 2019 | 222,514 | |
Vested at March 31, 2019 | 167,007 | |
Unvested restricted stock units as of March 31, 2019 | 55,507 |
STOCKHOLDERS' EQUITY (Details T
STOCKHOLDERS' EQUITY (Details Textual) - USD ($) | Feb. 07, 2019 | Feb. 28, 2019 | Jan. 31, 2019 | Feb. 28, 2019 | Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 |
Class of Stock [Line Items] | |||||||
Common Stock, Shares, Issued | 7,623,227 | 7,579,995 | |||||
Common Stock, Shares, Outstanding | 7,623,227 | 7,579,995 | |||||
Granted (in shares) | 28,700 | 258,392 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights | The options to purchase shares of common stock are exercisable at $10.55 per share, have a term of five years, and vest as to 50% of the options at the vesting commencement date, which is generally one year from the date of hire (vesting commencement dates range from June 4, 2019 through January 25, 2020), and vesting as to the remaining 50% of the options, in eight equal quarterly installments commencing on the first day of each calendar quarter following the vesting commencement date and installments continuing on the first day of each of the seven calendar quarters thereafter. All vesting is subject to the employee’s continued service through the vesting date. The exercise price was determined using the closing price of the Company’s common stock on February 7, 2019. | ||||||
Restricted Stock or Unit Expense | $ 376,626 | $ 220,864 | |||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Share-based Awards Other than Options | $ 111,596 | ||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 17,733 | 17,733 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 20,000 | 11,837 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | 880,585 | 997,989 | |||||
Stock Issued During Period Shares Stock Warrants Exercised | 1,395 | 10,000 | 11,395 | ||||
Proceeds from Warrant Exercises | $ 23,450 | ||||||
Preferred Stock, Liquidation Preference, Value | $ 1,255,685 | $ 1,242,740 | |||||
Preferred Stock, Liquidation Preference Per Share | $ 10 | ||||||
Proceeds from Stock Options Exercised | $ 19,000 | $ 42,450 | 0 | ||||
Employee Stock Option [Member] | |||||||
Class of Stock [Line Items] | |||||||
Expected dividend yield (as a percent) | 0.00% | ||||||
Allocated Share-based Compensation Expense | $ 72,274 | 145,046 | |||||
Deferred Compensation Liability, Current and Noncurrent | 293,475 | ||||||
Warrant [Member] | |||||||
Class of Stock [Line Items] | |||||||
Allocated Share-based Compensation Expense | $ 0 | $ 1,393 | |||||
Maximum | Employee Stock Option [Member] | |||||||
Class of Stock [Line Items] | |||||||
Expected term | 3 years 6 months | ||||||
Expected volatility (as a percent) | 292.28% | ||||||
Risk-free interest rate (as a percent) | 2.48% | ||||||
Minimum | Employee Stock Option [Member] | |||||||
Class of Stock [Line Items] | |||||||
Expected term | 3 years 3 months | ||||||
Expected volatility (as a percent) | 281.65% | ||||||
Risk-free interest rate (as a percent) | 2.46% | ||||||
Series A Preferred Stock [Member] | |||||||
Class of Stock [Line Items] | |||||||
Redemption Price (in dollars per share) | $ 4.385 | $ 4.385 | |||||
Preferred Stock, Dividend Rate, Percentage | 5.00% | ||||||
Dividends, Preferred Stock, Stock | $ 12,945 | ||||||
Common Stock Dividends, Shares | 2,952 | ||||||
Preferred stock unpaid dividend equivalent common stock, Shares | 46,906 | 43,954 | |||||
Dividends Payable | $ 205,685 | $ 192,740 | |||||
Preferred Stock, Shares Issued | 105,000 | 105,000 | |||||
Preferred Stock Issue Per Share | $ 10 |
SUBSEQUENT EVENTS (Details Text
SUBSEQUENT EVENTS (Details Textual) - USD ($) | 1 Months Ended | 2 Months Ended | 3 Months Ended | |||
Apr. 30, 2019 | Feb. 28, 2019 | Jan. 31, 2019 | Feb. 28, 2019 | Mar. 31, 2019 | Mar. 31, 2018 | |
Subsequent Event [Line Items] | ||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 17,733 | 17,733 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 20,000 | 11,837 | ||||
Proceeds from Stock Options Exercised | $ 19,000 | $ 42,450 | $ 0 | |||
Stock Issued During Period Shares Stock Warrants Exercised | 1,395 | 10,000 | 11,395 | |||
Subsequent Event | ||||||
Subsequent Event [Line Items] | ||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 6,400 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 17,120 | |||||
Proceeds from Stock Options Exercised | $ 82,292 | |||||
Stock Issued During Period Shares Stock Warrants Exercised | 1,990 |