Atomera (ATOM) 10-Q 3 Nov 20 2020 Q3 Quarterly report Financial data

Cover

Cover - shares	9 Months Ended
	Sep. 30, 2020	Oct. 28, 2020
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Sep. 30, 2020
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2020
Current Fiscal Year End Date	--12-31
Entity File Number	001-37850
Entity Registrant Name	ATOMERA INCORPORATED
Entity Central Index Key	0001420520
Entity Tax Identification Number	30-0509586
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	750 University Avenue
Entity Address, Address Line Two	Suite 280
Entity Address, City or Town	Los Gatos
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	95032
City Area Code	(408)
Local Phone Number	442-5248
Title of 12(b) Security	Common stock: Par value $0.001
Trading Symbol	ATOM
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Elected Not To Use the Extended Transition Period	true
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		21,455,276

Condensed Balance Sheets (Unaud

Condensed Balance Sheets (Unaudited) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Current assets:
Cash and cash equivalents	$ 25,297	$ 14,871
Prepaid expenses and other current assets	181	132
Total current assets	25,478	15,003
Property and equipment, net	87	63
Operating lease right-of-use asset	735	161
Long-term prepaid rent	450	0
Security deposit	13	13
Total assets	26,763	15,240
Current liabilities:
Accounts payable	563	315
Accrued expenses	234	145
Accrued payroll related expenses	511	819
Current operating lease liability	92	152
Deferred revenue	0	37
Total current liabilities	1,400	1,468
Long term operating lease liability	631	0
Total liabilities	2,031	1,468
Stockholders’ equity:
Preferred stock, $0.001 par value, authorized 2,500 shares; none issued and outstanding at September 30, 2020 and December 31, 2019	0	0
Common stock, $0.001 par value, authorized 47,500 shares; 20,971 and 17,117 shares issued and outstanding at September 30, 2020 and December 31, 2019, respectively	21	17
Additional paid-in capital	170,975	149,017
Accumulated deficit	(146,264)	(135,262)
Total stockholders’ equity	24,732	13,772
Total liabilities and stockholders’ equity	$ 26,763	$ 15,240

Condensed Balance Sheets (Una_2

Condensed Balance Sheets (Unaudited) (Parenthetical) - $ / shares shares in Thousands	Sep. 30, 2020	Dec. 31, 2019
Statement of Financial Position [Abstract]
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, authorized	2,500	2,500
Preferred stock, issued	0	0
Preferred stock, outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, authorized	47,500	47,500
Common stock, issued	20,971	17,117
Common stock, oustanding	20,971	17,117

Condensed Statements of Operati

Condensed Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Income Statement [Abstract]
Revenue	$ 0	$ 254	$ 62	$ 395
Cost of revenue	0	(204)	(13)	(224)
Gross margin	0	50	49	171
Operating expenses
Research and development	2,049	1,746	6,197	5,930
General and administrative	1,322	1,239	4,247	4,048
Selling and marketing	208	240	648	712
Total operating expenses	3,579	3,225	11,092	10,690
Loss from operations	(3,579)	(3,175)	(11,043)	(10,519)
Other income
Interest income	1	89	41	265
Total other income	1	89	41	265
Net loss	$ (3,578)	$ (3,086)	$ (11,002)	$ (10,254)
Net loss per common share, basic and diluted	$ (0.19)	$ (0.19)	$ (0.61)	$ (0.66)
Weighted average number of common shares outstanding, basic and diluted	19,337	16,567	18,028	15,597

Statement of Stockholders' Equi

Statement of Stockholders' Equity (Unaudited) - USD ($) shares in Thousands, $ in Thousands	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Total
Beginning balance, value at Dec. 31, 2018	$ 15	$ 139,693	$ (121,962)	$ 17,746
Beginning balance, shares at Dec. 31, 2018	15,034
Stock-based compensation		694		694
Stock-based compensation, shares	298
Net loss			(3,534)	(3,534)
Ending balance, value at Mar. 31, 2019	$ 15	140,387	(125,496)	14,906
Ending balance, shares at Mar. 31, 2019	15,332
Beginning balance, value at Dec. 31, 2018	$ 15	139,693	(121,962)	17,746
Beginning balance, shares at Dec. 31, 2018	15,034
Warrant modification				0
Ending balance, value at Sep. 30, 2019	$ 17	148,368	(132,216)	16,169
Ending balance, shares at Sep. 30, 2019	17,074
Beginning balance, value at Mar. 31, 2019	$ 15	140,387	(125,496)	14,906
Beginning balance, shares at Mar. 31, 2019	15,332
Registered direct offering of common stock, net of commissions and expenses	$ 2	6,395		6,397
Registered direct offering of common stock, net of commissions and expenses, shares	1,675
Stock-based compensation		788		788
Stock-based compensation, shares	67
Net loss			(3,634)	(3,634)
Ending balance, value at Jun. 30, 2019	$ 17	147,570	(129,130)	18,457
Ending balance, shares at Jun. 30, 2019	17,074
Stock-based compensation		798		798
Stock-based compensation, shares
Net loss			(3,086)	(3,086)
Ending balance, value at Sep. 30, 2019	$ 17	148,368	(132,216)	16,169
Ending balance, shares at Sep. 30, 2019	17,074
Beginning balance, value at Dec. 31, 2019	$ 17	149,017	(135,262)	13,772
Beginning balance, shares at Dec. 31, 2019	17,117
Stock-based compensation	$ 1	628		629
Stock-based compensation, shares	420
Warrant Exercise		164		164
Warrant exercise, shares	189
Warrant modification		139		139
Net loss			(3,645)	(3,645)
Ending balance, value at Mar. 31, 2020	$ 18	149,948	(138,907)	11,059
Ending balance, shares at Mar. 31, 2020	17,726
Beginning balance, value at Dec. 31, 2019	$ 17	149,017	(135,262)	13,772
Beginning balance, shares at Dec. 31, 2019	17,117
Warrant modification				139
Ending balance, value at Sep. 30, 2020	$ 21	170,975	(146,264)	24,732
Ending balance, shares at Sep. 30, 2020	20,971
Beginning balance, value at Mar. 31, 2020	$ 18	149,948	(138,907)	11,059
Beginning balance, shares at Mar. 31, 2020	17,726
Stock-based compensation		766		766
Stock-based compensation, shares	43
Net loss			(3,779)	(3,779)
Underwritten public offering of common stock, net of commissions and expenses	$ 2	9,393		9,395
Underwritten public offering of common stock, net of commissions and expenses, shares	2,024
Stock option exercise		137		137
Stock option exercise, shares	33
Ending balance, value at Jun. 30, 2020	$ 20	160,244	(142,686)	17,578
Ending balance, shares at Jun. 30, 2020	19,826
Stock-based compensation		829		829
Stock-based compensation, shares
Warrant Exercise		738		738
Warrant exercise, shares	196
Net loss			(3,578)	(3,578)
Stock option exercise		645		645
Stock option exercise, shares	103
At-the-market sale of stock, net of commissions and expenses	$ 1	8,519		8,520
At-the-market sale of stock, net of commissions and expenses, shares	846
Ending balance, value at Sep. 30, 2020	$ 21	$ 170,975	$ (146,264)	$ 24,732
Ending balance, shares at Sep. 30, 2020	20,971

Condensed Statements of Cash Fl

Condensed Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
CASH FLOWS FROM OPERATING ACTIVITIES
Net Loss	$ (11,002)	$ (10,254)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	32	33
Right of use asset amortization	107	99
Stock-based compensation	2,224	2,280
Warrant modification expense	139	0
Changes in operating assets and liabilities:
Accounts receivable	0	(2)
Prepaid expenses and other current assets	(49)	(22)
Long-term prepaid rent	(450)	0
Accounts payable	248	(143)
Accrued expenses	89	46
Accrued payroll expenses	(308)	(362)
Lease liability	(110)	(99)
Deferred revenue	(37)	(55)
Net cash used in operating activities	(9,117)	(8,479)
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of property and equipment	(56)	(51)
Net cash used in investing activities	(56)	(51)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from underwritten public offering, net of commissions and expenses	9,395	0
Proceeds from at-the-market sale of stock, net of commissions and expenses	8,520	0
Proceeds from registered direct offering of common stock, net of commissions and expenses	0	6,397
Proceeds from exercise of warrants	902	0
Proceeds from exercise of stock options	782	0
Net cash provided by financing activities	19,599	6,397
Net increase (decrease) in cash and cash equivalents	10,426	(2,133)
Cash and cash equivalents at beginning of period	14,871	18,933
Cash and cash equivalents at end of period	25,297	16,800
Supplemental information:
Cash paid for interest	0	0
Cash paid for taxes	$ 0	$ 0

NATURE OF OPERATIONS

NATURE OF OPERATIONS	9 Months Ended
	Sep. 30, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
NATURE OF OPERATIONS	1. NATURE OF OPERATIONS Atomera Incorporated (“Atomera” or the “Company”) was incorporated in the state of Delaware in March 2007 under the name MEARS Technologies, Inc. and is engaged in the development, commercialization and licensing of proprietary processes and technologies for the semiconductor industry. On January 12, 2016, the Company changed its name to Atomera Incorporated. The Company is in the development stage, having only recently begun limited revenue-generating activities, and is devoting substantially all of its efforts toward technology research and development and to commercially licensing its technology to designers and manufacturers of integrated circuits. The Company has primarily financed operations through private placements of equity and debt securities, the Company’s Initial Public Offering (the “IPO”) which was consummated on August 10, 2016, and subsequent public offerings of its common stock. On May 15, 2020, the Company closed an underwritten public offering of 2,024,000 5.00 9400 On September 2, 2020, Atomera entered into an Equity Distribution Agreement with Craig-Hallum Capital Group LLC, as agent, under which the Company may offer and sell, from time to time at its sole discretion, shares of its $ 0.001 25,000,000

LIQUIDITY AND MANAGEMENT PLANS

LIQUIDITY AND MANAGEMENT PLANS	9 Months Ended
	Sep. 30, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
LIQUIDITY AND MANAGEMENT PLANS	2. LIQUIDITY AND MANAGEMENT PLANS At September 30, 2020, the Company had cash and cash equivalents of approximately $ 25.3 25,297 24.1 Based on the funds it has available as of the date of the filing of this report, the Company believes that it has sufficient capital to fund its current business plans and obligations over at least 12 months from the date that these financial statements have been issued. However, the semiconductor industry is generally slow to adopt new manufacturing process technologies and conducts long testing and qualification processes which have limited the Company’s ability to control, and there can be no assurances of the timing of receipt of meaningful amounts of revenue. In addition, the COVID-19 pandemic has impacted some of the Company’s customer contract negotiations and delayed some engineering work by its customers. Accordingly, the Company may require additional capital, the receipt of which cannot be assured. In the event the Company requires additional capital, there can be no guarantee that funds will be available on commercially reasonable terms, if at all. The Company’s future capital requirements and the adequacy of its available funds will depend on many factors, including the Company’s ability to successfully commercialize its technology in the near term, competing technological and market developments, and the need to enter into collaborations with other companies or acquire technologies to enhance or complement its current offerings. If the Company is unable to secure additional capital, it may be required to curtail its research and development initiatives, change its business strategy and take additional measures to reduce costs in order to conserve its cash.

SUMMARY OF SIGNIFICANT ACCOUNTI

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	9 Months Ended
	Sep. 30, 2020
Accounting Policies [Abstract]
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Significant accounting policies There have been no material changes in the Company’s significant accounting policies to those previously disclosed in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on March 13, 2020 except those noted below under the caption “Adoption of recent accounting standards”. Basis of presentation of unaudited condensed financial information The unaudited condensed financial statements of the Company for the three and nine months ended September 30, 2020 and 2019 have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and pursuant to the requirements for reporting on Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by GAAP for complete financial statements. However, such information reflects all adjustments (consisting solely of normal recurring adjustments) which are, in the opinion of management, necessary for the fair presentation of the Company’s financial position and the results of operations. Results shown for interim periods are not necessarily indicative of the results to be obtained for a full fiscal year. The balance sheet information as of December 31, 2019 was derived from the audited financial statements included in the Company's financial statements as of and for the year ended December 31, 2019 included in the Company’s Annual Report on Form 10-K filed with the SEC on March 13, 2020. These financial statements should be read in conjunction with that report. Adoption of recent accounting standards In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments Recent accounting standards In August 2020, the FASB issued ASU No. 2020-06, Debt with Conversion and other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40). .

REVENUE

REVENUE	9 Months Ended
	Sep. 30, 2020
Revenue from Contract with Customer [Abstract]
REVENUE	4. REVENUE The Company recognizes revenue when it satisfies a performance obligation by transferring the product or service to the customer, either at a point in time or over time. The Company usually recognizes revenue from integration service agreements at a point in time and integration license agreements over a period of time. Disaggregation of revenue: The following table provides information about disaggregated revenue by primary geographical markets and timing of revenue recognition for the three and nine month periods ended September 30, 2020 and 2019 (in thousands): Information about disaggregated revenue and timing of revenue Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Primary geographic markets North America $ – $ 50 $ 62 $ 50 Europe – 104 – 187 Asia Pacific – 100 – 158 Total $ – $ 254 $ 62 $ 395 Timing of revenue recognition Products and services transferred at a point in time $ – $ 222 $ 62 $ 240 Products and services transferred over time – 32 – 155 Total $ – $ 254 $ 62 $ 395 Unbilled contracts receivable and deferred revenue : Timing of revenue recognition may differ from the timing of invoicing customers. Accounts receivable includes amounts billed and currently due from customers. Unbilled contracts receivable represents unbilled amounts expected to be received from customers in future periods, where the revenue recognized to date exceeds the amount billed, and the right to receive payment is subject to the underlying contractual terms. Unbilled contracts receivable amounts may not exceed their net realizable value and are classified as long-term assets if the payments are expected to be received more than one year from the reporting date. The Company records deferred revenue when revenue will be recognized after invoicing. During the nine months ended September 30, 2020, the Company recognized approximately $ 37,000

BASIC AND DILUTED LOSS PER SHAR

BASIC AND DILUTED LOSS PER SHARE	9 Months Ended
	Sep. 30, 2020
Earnings Per Share [Abstract]
BASIC AND DILUTED LOSS PER SHARE	5. BASIC AND DILUTED LOSS PER SHARE Basic net loss per share is calculated by dividing the net loss by the weighted-average number of shares outstanding for the period. Diluted net loss per share is computed by dividing the net loss attributable to common stockholders by the sum of the weighted average number of shares of common stock outstanding and the dilutive common stock equivalent shares outstanding during the period. The Company’s potentially dilutive common stock equivalent shares, which include incremental common shares issuable upon (i) the exercise of outstanding stock options and warrants and (ii) vesting of restricted stock units and restricted stock awards, are only included in the calculation of diluted net loss per share when their effect is dilutive. Since the Company has had net losses for all periods presented, all potentially dilutive securities are anti-dilutive. Accordingly, basic and diluted net loss per share are equal. The following potential common stock equivalents were not included in the calculation of diluted net loss per common share because the inclusion thereof would be anti-dilutive (in thousands): Schedule of anti dilutive shares Three and Nine Months Ended September 30, 2020 2019 Stock Options 3,463 2,935 Unvested restricted stock 716 480 Warrants 369 765 Total 4,548 4,180

LEASES

LEASES	9 Months Ended
	Sep. 30, 2020
Leases
LEASES	6. LEASES The Company leases corporate office space in Los Gatos, California. In August 2020, the Company and its landlord amended the lease of this office. This amendment extends the expiration date of the lease from January 2021 to January 2026 and increases the space from 3,396 square feet to 4,101 square feet. Under Accounting Standard Codification (“ASC”) 842, the lease amendment was treated as a separate lease for the new space and a modification of the lease for the original space. An additional right-of-use (“ROU”) asset and lease liability of approximately $681,000 5.5% $144,000 The components of operating lease costs were as follows (in thousands): Components of lease costs Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Fixed lease costs $ 30 $ 27 $ 83 $ 81 Variable lease costs 9 14 36 40 Short term lease costs 11 7 28 23 Total operating lease costs $ 50 $ 48 $ 147 $ 144 Future minimum payments under non-cancellable leases as of September 30, 2020 were as follows (in thousands): Schedule of future minimum lease payments For the Year Ended December 31, Amount Remaining 2020 $ 27 2021 108 2022 166 2023 170 2024 & thereafter 371 Total future minimum lease payments 842 Less imputed interest (119 ) Total lease liability $ 723 The following table provides supplemental information and non-cash activity related to the Company’s operating leases (in thousands): Supplemental non-cash activity related to operating leases Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Operating cash flow information: Cash paid for amounts included in the measurement of lease liabilities $ 41 $ 40 $ 123 $ 120 Non-cash activity: Right-of-use assets obtained in exchange for the lease obligations $ 681 $ – $ 681 $ 295 In October 2019, the Company entered into an agreement to lease a tool for use in the development of the Company’s technology. The lease is for five years at $150,000 per month. The lease commencement date is anticipated to be in November 2020, at which time the Company will account for the lease under ASC 842. A prepayment of $ 450,000

WARRANTS

WARRANTS	9 Months Ended
	Sep. 30, 2020
Equity [Abstract]
WARRANTS	7. WARRANTS A summary of warrant activity for the nine months ended September 30, 2020 is as follows (in thousands except per share amounts and contractual term): Schedule of warrant activity Number of Shares Weighted- Average Exercise Price Weighted- Remaining Contractual Term (In Years) Outstanding at January 1, 2020 765 $ 5.75 Exercised (386 ) $ 2.34 Expired (10 ) $ 0.15 Outstanding at September 30, 2020 369 $ 9.46 0.8 The warrants outstanding at September 30, 2020 had an intrinsic value of approximately $ 396,000 On March 17, 2020, 196,602 warrants with an exercise price of $3.75 were set to expire. Prior to the expiration, the Company entered into an agreement with the warrant holders, whereby it modified the terms of the warrants to extend the expiration date until September 17, 2020 in exchange for the removal of a cashless exercise provision. No other terms were modified. Due to this modification, the Company incurred a modification expense of approximately $ 139,000

STOCK BASED COMPENSATION

STOCK BASED COMPENSATION	9 Months Ended
	Sep. 30, 2020
Share-based Payment Arrangement [Abstract]
STOCK BASED COMPENSATION	8. STOCK BASED COMPENSATION In May 2017, the Company’s shareholders approved its 2017 Stock Incentive Plan (“2017 Plan”) after its 2007 Stock Incentive Plan (“2007 Plan”) had expired in March 2017. The 2017 Plan provides for the grant of non-qualified stock options and incentive stock options to purchase shares of the Company’s common stock and for the grant of restricted and unrestricted shares. The 2017 Plan provides for the issuance of 3,750,000 The following table summarizes the stock-based compensation expense recorded in the Company’s results of operations during the three and nine months ended September 30, 2020 and 2019 for stock options and restricted stock granted under the 2017 Plan and the 2007 Plan (in thousands): Schedule of stock-based compensation expense Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Research and development $ 319 $ 223 $ 843 $ 622 General and administrative 470 541 1,269 1,557 Selling and Marketing 40 34 112 101 $ 829 $ 798 $ 2,224 $ 2,280 As September 30, 2020, there was approximately $ 5.8 2.7 The weighted average grant date fair value per share of the options granted under the Company’s 2017 Plan was $ 7.64 2.80 2.50 The following table summarizes stock option activity during the nine months ended September 30, 2020 (in thousands except exercise prices and contractual terms): Schedule of stock option activity Number of Shares Weighted- Average Exercise Prices Weighted- Remaining Contractual Term (In Years) Intrinsic Outstanding at January 1, 2020 2,935 $ 6.36 Granted 664 $ 4.20 Exercised (136 ) $ 5.76 Outstanding at September 30, 2020 3,463 $ 5.97 6.77 $ 15,677 Exercisable at September 30, 2020 2,404 $ 6.62 5.92 $ 9,358 During the nine months ended September 30, 2020, the Company granted options under the 2017 Plan to purchase approximately 664,000 1.9 The Company issues restricted stock to employees, directors and consultants and estimates the fair value based on the closing price on the day of grant. The following table summarizes all restricted stock activity during the nine months ended September 30, 2020 (in thousands except per share data): Schedule of restricted stock option activity Number of Shares Weighted- Average Grant Date Outstanding at January 1, 2020 486 $ 4.50 Granted 463 $ 4.43 Vested (233 ) $ 4.57 Outstanding non-vested shares at September 30, 2020 716 $ 4.43 During the nine months ended September 30, 2020, the Company granted approximately 463,000 2.1

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	9 Months Ended
	Sep. 30, 2020
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	9. COMMITMENTS AND CONTINGENCIES Litigation, Claims and Assessments The Company may be subject to periodic lawsuits, investigations and claims that arise in the ordinary course of business. The Company is not party to any material litigation as of September 30, 2020, or through the date these financial statements have been issued.

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	9 Months Ended
	Sep. 30, 2020
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	10. SUBSEQUENT EVENTS Management has evaluated subsequent events and transactions through the date these financial statements were issued. Between October 1, 2020 and the date of filing this report, the Company issued and sold 484,148 shares of its common stock through the At-The-Market program initiated in September 2020. Net proceeds from the sale of these shares after sales commissions and expenses was approximately $5.0 million.

SUMMARY OF SIGNIFICANT ACCOUN_2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	9 Months Ended
	Sep. 30, 2020
Accounting Policies [Abstract]
Basis of presentation of unaudited condensed financial information	Basis of presentation of unaudited condensed financial information The unaudited condensed financial statements of the Company for the three and nine months ended September 30, 2020 and 2019 have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and pursuant to the requirements for reporting on Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by GAAP for complete financial statements. However, such information reflects all adjustments (consisting solely of normal recurring adjustments) which are, in the opinion of management, necessary for the fair presentation of the Company’s financial position and the results of operations. Results shown for interim periods are not necessarily indicative of the results to be obtained for a full fiscal year. The balance sheet information as of December 31, 2019 was derived from the audited financial statements included in the Company's financial statements as of and for the year ended December 31, 2019 included in the Company’s Annual Report on Form 10-K filed with the SEC on March 13, 2020. These financial statements should be read in conjunction with that report.
Adoption of recent accounting standards	Adoption of recent accounting standards In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments Recent accounting standards In August 2020, the FASB issued ASU No. 2020-06, Debt with Conversion and other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40). .

REVENUE (Tables)

REVENUE (Tables)	9 Months Ended
	Sep. 30, 2020
Revenue from Contract with Customer [Abstract]
Information about disaggregated revenue and timing of revenue	Information about disaggregated revenue and timing of revenue Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Primary geographic markets North America $ – $ 50 $ 62 $ 50 Europe – 104 – 187 Asia Pacific – 100 – 158 Total $ – $ 254 $ 62 $ 395 Timing of revenue recognition Products and services transferred at a point in time $ – $ 222 $ 62 $ 240 Products and services transferred over time – 32 – 155 Total $ – $ 254 $ 62 $ 395

BASIC AND DILUTED LOSS PER SH_2

BASIC AND DILUTED LOSS PER SHARE (Tables)	9 Months Ended
	Sep. 30, 2020
Earnings Per Share [Abstract]
Schedule of anti dilutive shares	Schedule of anti dilutive shares Three and Nine Months Ended September 30, 2020 2019 Stock Options 3,463 2,935 Unvested restricted stock 716 480 Warrants 369 765 Total 4,548 4,180

LEASES (Tables)

LEASES (Tables)	9 Months Ended
	Sep. 30, 2020
Leases
Components of lease costs	Components of lease costs Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Fixed lease costs $ 30 $ 27 $ 83 $ 81 Variable lease costs 9 14 36 40 Short term lease costs 11 7 28 23 Total operating lease costs $ 50 $ 48 $ 147 $ 144
Schedule of future minimum lease payments	Schedule of future minimum lease payments For the Year Ended December 31, Amount Remaining 2020 $ 27 2021 108 2022 166 2023 170 2024 & thereafter 371 Total future minimum lease payments 842 Less imputed interest (119 ) Total lease liability $ 723
Supplemental non-cash activity related to operating leases	Supplemental non-cash activity related to operating leases Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Operating cash flow information: Cash paid for amounts included in the measurement of lease liabilities $ 41 $ 40 $ 123 $ 120 Non-cash activity: Right-of-use assets obtained in exchange for the lease obligations $ 681 $ – $ 681 $ 295

WARRANTS (Tables)

WARRANTS (Tables)	9 Months Ended
	Sep. 30, 2020
Equity [Abstract]
Schedule of warrant activity	Schedule of warrant activity Number of Shares Weighted- Average Exercise Price Weighted- Remaining Contractual Term (In Years) Outstanding at January 1, 2020 765 $ 5.75 Exercised (386 ) $ 2.34 Expired (10 ) $ 0.15 Outstanding at September 30, 2020 369 $ 9.46 0.8

STOCK BASED COMPENSATION (Table

STOCK BASED COMPENSATION (Tables)	9 Months Ended
	Sep. 30, 2020
Share-based Payment Arrangement [Abstract]
Schedule of stock-based compensation expense	Schedule of stock-based compensation expense Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Research and development $ 319 $ 223 $ 843 $ 622 General and administrative 470 541 1,269 1,557 Selling and Marketing 40 34 112 101 $ 829 $ 798 $ 2,224 $ 2,280
Schedule of stock option activity	Schedule of stock option activity Number of Shares Weighted- Average Exercise Prices Weighted- Remaining Contractual Term (In Years) Intrinsic Outstanding at January 1, 2020 2,935 $ 6.36 Granted 664 $ 4.20 Exercised (136 ) $ 5.76 Outstanding at September 30, 2020 3,463 $ 5.97 6.77 $ 15,677 Exercisable at September 30, 2020 2,404 $ 6.62 5.92 $ 9,358
Schedule of restricted stock option activity	Schedule of restricted stock option activity Number of Shares Weighted- Average Grant Date Outstanding at January 1, 2020 486 $ 4.50 Granted 463 $ 4.43 Vested (233 ) $ 4.57 Outstanding non-vested shares at September 30, 2020 716 $ 4.43

NATURE OF OPERATIONS (Details N

NATURE OF OPERATIONS (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands	4 Months Ended	9 Months Ended
	May 15, 2020	Sep. 30, 2020	Sep. 30, 2019	Sep. 02, 2020
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Proceeds from Issuance of Common Stock		$ 9,395	$ 0
Equity Distribution Agreement [Member] | Craig Hallum Capital Group L L C [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Maximum offering price				$ 25,000
Public Offering [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Stock Issued During Period, Shares, New Issues	2,024,000
Sale of Stock, Price Per Share	$ 5
Proceeds from Issuance of Common Stock	$ 9,400

LIQUIDITY AND MANAGEMENT PLANS

LIQUIDITY AND MANAGEMENT PLANS (Details Narrative) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019	Sep. 30, 2019	Dec. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Cash and cash equivalents	$ 25,297	$ 14,871	$ 16,800	$ 18,933
Working capital	$ 24,100

REVENUE (Details)

REVENUE (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Disaggregation of Revenue [Line Items]
Revenue	$ 0	$ 254	$ 62	$ 395
Transferred at Point in Time [Member]
Disaggregation of Revenue [Line Items]
Revenue	0	222	62	240
Transferred over Time [Member]
Disaggregation of Revenue [Line Items]
Revenue	0	32	0	155
North America [Member]
Disaggregation of Revenue [Line Items]
Revenue	0	50	62	50
Europe [Member]
Disaggregation of Revenue [Line Items]
Revenue	0	104	0	187
Asia Pacific [Member]
Disaggregation of Revenue [Line Items]
Revenue	$ 0	$ 100	$ 0	$ 158

REVENUE (Details Narrative)

REVENUE (Details Narrative) $ in Thousands	9 Months Ended
	Sep. 30, 2020USD ($)
Revenue from Contract with Customer [Abstract]
Revenue recognized that was previously included in deferred revenue	$ 37

BASIC AND DILUTED LOSS PER SH_3

BASIC AND DILUTED LOSS PER SHARE (Details) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potential common stock equivalents	4,548	4,180	4,548	4,180
Share-based Payment Arrangement, Option [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potential common stock equivalents	3,463	2,935	3,463	2,935
Unvested Restricted Stock [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potential common stock equivalents	716	480	716	480
Warrant [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potential common stock equivalents	369	765	369	765

LEASES (Details - Lease costs)

LEASES (Details - Lease costs) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Leases [Abstract]
Fixed lease costs	$ 30	$ 27	$ 83	$ 81
Variable lease costs	9	14	36	40
Short term lease costs	11	7	28	23
Total operating lease costs	$ 50	$ 48	$ 147	$ 144

LEASES (Details - Minimum lease

LEASES (Details - Minimum lease payments) $ in Thousands	Sep. 30, 2020USD ($)
Leases [Abstract]
Remaining 2020	$ 27
2021	108
2022	166
2023	170
2024 & thereafter	371
Total future minimum lease payments	842
Less imputed interest	(119)
Total lease liability	$ 723

LEASES (Details - Cash flow eff

LEASES (Details - Cash flow effect) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Operating cash flow information:
Cash paid for amounts included in the measurement of lease liabilities	$ 41	$ 40	$ 123	$ 120
Non-cash activity:
Right-of-use assets obtained in exchange for the lease obligations	$ 681	$ 0	$ 681	$ 295

LEASES (Details Narrative)

LEASES (Details Narrative) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Lessee, Lease, Description [Line Items]
Operating lease right-of-use asset	$ 735	$ 161
Operating lease liability	$ 723
Incremental borrowing rate	5.50%
Additional right-of-use assets	$ 144
Additional lease liability	144
Long-term prepaid rent	450	$ 0
CALIFORNIA
Lessee, Lease, Description [Line Items]
Operating lease right-of-use asset	681
Operating lease liability	$ 681

WARRANTS (Details - Warrant act

WARRANTS (Details - Warrant activity) - Warrant [Member] shares in Thousands	9 Months Ended
	Sep. 30, 2020$ / sharesshares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Warrants outstanding, beginning balance | shares	765
Weighted-average exercise price, warrants outstanding, beginning balance | $ / shares	$ 5.75
Warrants exercised | shares	(386)
Weighted-average exercise price, warrants exercised | $ / shares	$ 2.34
Warrant expired | shares	(10)
Weighted-average exercise price, warrants expired | $ / shares	$ 0.15
Warrants outstanding, ending balance | shares	369
Weighted-average exercise price, warrants outstanding, ending balance | $ / shares	$ 9.46
Weighted-average remaining contractual term	9 months 18 days

WARRANTS (Details Narrative)

WARRANTS (Details Narrative) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Mar. 31, 2020	Sep. 30, 2020	Sep. 30, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Warrant modification expense	$ 139	$ 139	$ 0
Warrant [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Warrant intrinsic value		396
Warrant modification expense		$ 139

STOCK BASED COMPENSATION (Detai

STOCK BASED COMPENSATION (Details - Compensation Expense) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Allocated stock-based compensation	$ 829	$ 798	$ 2,224	$ 2,280
Research and Development Expense [Member]
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Allocated stock-based compensation	319	223	843	622
General and Administrative Expense [Member]
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Allocated stock-based compensation	470	541	1,269	1,557
Selling and Marketing [Member]
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Allocated stock-based compensation	$ 40	$ 34	$ 112	$ 101

STOCK BASED COMPENSATION (Det_2

STOCK BASED COMPENSATION (Details - Stock Option Activity) - Equity Option [Member] $ / shares in Units, shares in Thousands, $ in Thousands	9 Months Ended
	Sep. 30, 2020USD ($)$ / sharesshares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options outstanding, beginning balance | shares	2,935
Weighted average exercise price, options outstanding beginning balance | $ / shares	$ 6.36
Options granted | shares	664
Weighted average exercise price, options granted | $ / shares	$ 4.20
Options exercised | shares	(136)
Weighted average exercise price, options exercised | $ / shares	$ 5.76
Options outstanding, ending balance | shares	3,463
Weighted average exercise price, options outstanding, ending balance | $ / shares	$ 5.97
Weighted average remaining contractual term, options outstanding	6 years 9 months 7 days
Intrinsic value, options outstanding ending balance | $	$ 15,677
Options exercisable | shares	2,404
Weighted average exercise price, options exercisable | $ / shares	$ 6.62
Weighted average remaining contractual term, options exercisable	5 years 11 months 1 day
Intrinsic value, options exercisable | $	$ 9,358

STOCK BASED COMPENSATION (Det_3

STOCK BASED COMPENSATION (Details - Restricted stock) - Restricted Stock [Member] shares in Thousands	9 Months Ended
	Sep. 30, 2020$ / sharesshares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock outstanding, beginning balance | shares	486
Restricted stock outstanding, beginning balance | $ / shares	$ 4.50
Restricted stock granted | shares	463
Restricted stock granted | $ / shares	$ 4.43
Restricted stock vested | shares	(233)
Restricted stock vested | $ / shares	$ 4.57
Restricted stock outstanding, ending balance | shares	716
Restricted stock outstanding, ending balance | $ / shares	$ 4.43

STOCK BASED COMPENSATION (Det_4

STOCK BASED COMPENSATION (Details Narrative) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2020	Sep. 30, 2019
Equity Option [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expense	$ 5,800	$ 5,800
Unrecognized compensation weighted average period		2 years 8 months 12 days
Weighted average grant date fair value per share	$ 7.64	$ 2.80	$ 2.50
Options granted		664
Fair value of options granted		$ 1,900
Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock granted		463
Fair value of restricted stock granted		$ 2,100
2017 Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares authorized for issuance	3,750	3,750