Document_and_Entity_Informatio
Document and Entity Information | 12 Months Ended |
Dec. 31, 2013 | |
Document and Entity Information [Abstract] | ' |
Entity Registrant Name | 'ARISTA POWER, INC. |
Entity Central Index Key | '0001424640 |
Amendment Flag | 'false |
Document Type | 'S-1 |
Document Period End Date | 31-Dec-13 |
Entity Filer Category | 'Smaller Reporting Company |
Balance_Sheets
Balance Sheets (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Current assets | ' | ' |
Cash | $297,385 | $78,253 |
Accounts Receivable (net of allowance for doubtful accounts $0 in 2013 and $25,200 in 2012) | 265,245 | 400,419 |
Prepaid expenses and other current assets | 232,570 | 275,371 |
Inventory | 496,313 | 669,745 |
Deferred debt discount | 820,750 | 1,090,750 |
Total current assets | 2,112,263 | 2,514,538 |
Other assets | 172,362 | 0 |
Intangible assets, net | 25,305 | 30,713 |
Property and equipment, net | 69,555 | 121,587 |
Total assets | 2,379,485 | 2,666,838 |
Current Liabilities | ' | ' |
Accounts payable | 1,175,221 | 1,268,947 |
Borrowings under line of credit, net of debt discount | 684,994 | 166,513 |
Customer deposits | 19,000 | 127,239 |
Accrued loss contract | 519,092 | 0 |
Accrued payroll | 146,465 | 78,445 |
Accrued warranty costs | 140,074 | 140,074 |
Deferred revenue | 63,311 | 126,043 |
Accrued liabilities | 496,011 | 418,069 |
Current portion of long term debt | 11,782 | 11,688 |
Derivative liability | 13,200 | 0 |
Total current liabilities | 3,269,150 | 2,337,018 |
Commitments and Contingencies (Note 9) | ' | ' |
Long term liabilities | ' | ' |
Long term debt | 16,169 | 27,951 |
Derivative liability - long term | 762,396 | 0 |
Total long term liabilities | 778,565 | 27,951 |
Stockholders' (deficit)/equity | ' | ' |
Preferred stock, 5,000,000 shares authorized, $.0001 par value; none issued or outstanding at December 31, 2013 or December 31, 2012 | 0 | 0 |
Common stock, 500,000,000 shares authorized, $0.002 par value; 17,993,694 and 12,406,633 shares issued and outstanding at December 31, 2013 and December 31, 2012, respectively | 35,987 | 24,813 |
Additional paid-in capital | 25,330,474 | 24,038,807 |
Deficit accumulated | -27,034,691 | -23,761,751 |
Total stockholders' (deficit)/equity | -1,668,230 | 301,869 |
Total liabilities and stockholders' equity | $2,379,485 | $2,666,838 |
Balance_Sheets_Parenthetical
Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Balance Sheets [Abstract] | ' | ' |
Allowance for doubtful accounts | $0 | $25,200 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, par value | $0.00 | $0.00 |
Preferred stock, shares issued | ' | ' |
Preferred stock, shares outstanding | ' | ' |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, par value | $0.00 | $0.00 |
Common stock, shares issued | 17,993,694 | 12,406,633 |
Common stock, shares outstanding | 17,993,694 | 12,406,633 |
Statements_of_Operations
Statements of Operations (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Statements Of Operations [Abstract] | ' | ' |
Sales | $2,195,434 | $1,998,667 |
Cost of Goods Sold | 2,783,204 | 2,439,759 |
Gross Loss | -587,770 | -441,092 |
Operating Expenses: | ' | ' |
Research and development expenses | 377,777 | 526,460 |
Selling, general and administrative expenses | 2,460,689 | 2,495,474 |
Total expenses | 2,838,466 | 3,021,934 |
Loss from operations | -3,426,236 | -3,463,026 |
Non-operating (revenue)/expense | ' | ' |
Interest | 626,223 | 185,765 |
Unrealized gain on change in fair value of derivative liabilities | -676,048 | 0 |
Net loss before income taxes | -3,376,411 | -3,648,791 |
Income taxes | -103,471 | -158,895 |
Net loss | ($3,272,940) | ($3,489,896) |
Net loss per common share - basic and diluted | ($0.21) | ($0.29) |
Weighted average number of common shares - basic and diluted | 15,345,605 | 12,229,680 |
Statements_of_Cash_Flows
Statements of Cash Flows (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Operating activities | ' | ' |
Net loss | ($3,272,940) | ($3,489,896) |
Adjustments to reconcile net loss to net cash used in operating activities: | ' | ' |
Amortization and depreciation expense | 64,517 | 118,059 |
Stock based compensation | 695,250 | 581,940 |
Financing fees- issuance of warrants, non-cash | ' | 126,958 |
Stock and warrants issued for services and rent | 334,425 | 289,015 |
Amortization of debt discount | 518,481 | 166,513 |
Impairment of assets | 168,247 | 33,302 |
Impairment of inventory and increase in inventory reserves | 20,486 | 27,702 |
Establishment of loss contract reserves | 638,850 | 0 |
Change in fair value of derivative liability | -676,048 | 0 |
Bad debt expense | 0 | 26,942 |
Changes in operating assets and liabilities: | ' | ' |
Decrease in prepaid expenses and other current assets | 86,882 | 71,416 |
Decrease/(increase) in trade accounts receivable | 135,174 | -354,049 |
Decrease/(increase) in inventory | 142,171 | -158,323 |
(Decrease)/increase in customer deposits | -108,239 | 15,021 |
Decrease in accrued loss contract | -119,758 | 0 |
Increase in warranty reserve | 0 | 4,468 |
(Decrease)/increase in deferred revenue | -62,732 | 126,043 |
Increase in trade accounts payable and accrued liabilities | 151,054 | 612,975 |
Net cash used in operating activities | -1,284,180 | -1,801,914 |
Investing Activities | ' | ' |
Acquisition of fixed assets | 0 | -22,778 |
Net cash used in investing activities | 0 | -22,778 |
Financing activities | ' | ' |
Borrowings on line of credit | 270,000 | 748,500 |
(Repayments)/borrowings of long term debt, net | -11,688 | -11,687 |
Proceeds of issuance of common stock, net of stock offerings expenses | 1,245,000 | 795,000 |
Net cash provided by financing activities | 1,503,312 | 1,531,813 |
Increase/(decrease) in cash | 219,132 | -292,879 |
Cash - beginning of period | 78,253 | 371,132 |
Cash - end of period | 297,385 | 78,253 |
Supplemental Information: | ' | ' |
(Tax credits received)/income taxes paid | -103,471 | -158,895 |
Interest paid | 7,752 | 3,866 |
Non-cash investing and financing activities: | ' | ' |
Stock issued for accrued expenses | 157,903 | 0 |
Application of deferred debt discount | $270,000 | $15,688 |
Warrants issued for prepaid rent and services | 646,332 | 0 |
Statement_of_Stockholders_Defi
Statement of Stockholders' (Deficit)/Equity (USD $) | Total | Common Stock | Additional Paid In Capital | Accumulated Deficit |
Balance at Dec. 31, 2011 | $159,602 | $23,709 | $20,407,748 | ($20,271,855) |
Balance, shares at Dec. 31, 2011 | ' | 11,854,644 | ' | ' |
Rounding due to reverse stock split, shares | ' | 272 | ' | ' |
Issuance of common stock for cash | 795,000 | 795 | 794,205 | ' |
Issuance of common stock for cash, shares | ' | 397,500 | ' | ' |
Issuance of common stock for rent and services | 289,015 | 306 | 288,709 | ' |
Issuance of common stock for rent and services, shares | ' | 152,959 | ' | ' |
Issuance of common stock under stock award | 3,053 | 3 | 3,050 | ' |
Issuance of common stock under stock award, shares | ' | 1,258 | ' | ' |
Stock option expense | 578,887 | ' | 578,887 | ' |
Issuance of warrants for financing | 126,958 | ' | 126,958 | ' |
Issuance of warrants with revolving line of credit facility | 1,839,250 | ' | 1,839,250 | ' |
Net loss for year | -3,489,896 | ' | ' | -3,489,896 |
Balance at Dec. 31, 2012 | 301,869 | 24,813 | 24,038,807 | -23,761,751 |
Balance, shares at Dec. 31, 2012 | ' | 12,406,633 | ' | ' |
Issuance of common stock for cash | 1,245,000 | 10,040 | 1,234,960 | ' |
Issuance of common stock for cash, shares | ' | 5,020,000 | ' | ' |
Issuance of common stock for rent and services | 258,391 | 1,134 | 257,257 | ' |
Issuance of common stock for rent and services, shares | ' | 567,061 | ' | ' |
Stock option expense | 695,250 | ' | 695,250 | ' |
Issuance of warrants with private placement | -895,800 | ' | -895,800 | ' |
Net loss for year | -3,272,940 | ' | ' | -3,272,940 |
Balance at Dec. 31, 2013 | ($1,668,230) | $35,987 | $25,330,474 | ($27,034,691) |
Balance, shares at Dec. 31, 2013 | ' | 17,993,694 | ' | ' |
Description_of_the_Business_an
Description of the Business and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2013 | |
Description Of Business and Summary Of Significant Accounting Policies [Abstract] | ' |
Description of Business and Summary of Significant Accounting Policies | ' |
Note 1 – Description of the Business and Summary of Significant Accounting Policies | |
Description of Business | |
Arista Power, Inc. (the Company) was incorporated on March 30, 2001 in the State of New York as Future Energy Solutions, Inc. and in November 2008 changed its name to WindTamer Corporation. In May 2011, the Company changed its name to Arista Power, Inc. The name change more accurately reflects the broadening of the Company’s focus beyond the WindTamer® brand and entry into areas within the energy storage and power management industries. | |
The Company is a developer, integrator, and supplier of custom-designed power management systems, and a supplier, designer and installer of solar energy systems. The Company’s patent-pending Power on Demand system utilizes inputs from multiple energy sources including solar, wind, fuel cells, generators, and the grid, in conjunction with a custom-designed battery storage system and a proprietary smart monitoring technology that releases energy at optimal times to reduce electricity costs for large energy users. The Company also designs, sells and installs residential and commercial solar PV systems. | |
Method of Accounting | |
The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Arista Power, Inc. maintains its books and prepares its financial statements on the accrual basis of accounting. | |
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 and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. | |
Cash and Cash Equivalents | |
For financial statement presentation purposes, the Company considers all short-term, highly liquid investments with original maturities of three months or less to be cash and cash equivalents. The Company maintains its cash and cash equivalents in bank deposit accounts, which at times may exceed federally insured limits. The Company believes it is not exposed to any significant credit risk as a result of any non-performance by the financial institutions. | |
Accounts Receivable | |
Accounts receivable are stated at estimated net realizable value. Accounts receivable are comprised of balances due from customers net of estimated allowances for uncollectible accounts, if any. In determining collectability, specific customer issues are reviewed to arrive at appropriate allowances. The allowance for doubtful accounts at December 31, 2013 and 2012 were $0 and $25,200, respectively. | |
Inventory | |
Inventory consists of components for Power on Demand and solar PV systems, and is stated at the lower of cost or market value. The Company capitalizes applicable direct and indirect costs incurred in the Company’s production operations to bring its products to a sellable state. The inventory as of December 31, 2013 consisted of component inventory amounting to $346,014 and work in process inventory of $150,299. Inventory as of December 31, 2012 consisted of component inventory of $197,928 and work in progress inventory of $471,817. Inventory is reviewed quarterly to determine the need for an excess and obsolete inventory reserve. As of December 31, 2013 and 2012, no such reserve was required. For the year ended December 31, 2012, all remaining turbine inventory was written off and disposed of. | |
Fixed Assets | |
Fixed assets are recorded at cost. Depreciation is on a straight line basis over the shorter of the estimated useful lives or the related lease for leasehold improvements. Leasehold improvements for space leased on a month-to-month basis are expensed when incurred. Expenditures for renewals and betterments are capitalized. Expenditures for minor items, repairs and maintenance are charged to operations as incurred. Any gain or loss upon sale or retirement due to obsolescence is reflected in the operating results in the period the event takes place. | |
Intangible Assets | |
Intangible assets consist of costs associated with the application and acquisition of the Company’s patents and trademarks. Patent application costs are capitalized and amortized over the estimated useful life of the patent, which generally approximates its legal life. | |
Impairment of Long-Lived Assets | |
Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future net undiscounted cash flows expected to be generated by the asset, including its ultimate disposition. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Fair value is determined based on discounted cash flows or appraised values, depending on the nature of the assets. For the year ended December 31, 2013, trademark costs totaling $3,699 relating to the Company’s WindTamer® trademark were impaired, while for the year ended December 31, 2012, the Company impaired assets totaling $33,302 for assets related primarily to tooling for turbine components. | |
Fair Value of Financial Instruments | |
The carrying amount of cash, accounts payable and accrued expenses are reasonable estimates of their fair value due to their short maturity. | |
Revenue Recognition | |
Revenue is recognized when all of the following conditions are satisfied: (1) there is persuasive evidence of an arrangement; (2) the service or product has been provided to the customer; (3) the sale price to be paid by the customer is fixed or determinable; and (4) the collection of the sale price is reasonably assured. Amounts collected prior to satisfying our revenue recognition policy are reflected as customer deposits. | |
For research and development contracts, we recognize the revenue using the proportional effort method based upon the relationship of costs incurred to date to the total estimated cost to complete the contract. Cost elements include direct labor, materials, overhead costs and outside contractor costs. The excess of amounts billed on a milestone basis versus the amounts recorded as revenue on a proportional effort basis is classified as deferred revenue. We provide for any loss that we expect to incur in the agreements when the loss is probable. | |
The Company uses contract accounting for certain Power on Demand system sales. Due to the limited number of these systems that have been installed to date, revenue is recognized based on the completed contract method whereby revenue and costs are deferred until the contract is completed. For contracts that contain provisions related to proceeds being paid based upon cost savings generated by the system, revenue is recorded as the costs savings are realized by and billed to the customer. If accumulated costs exceed accumulated billings at the reporting date the asset is presented net as costs of uncompleted contracts in excess of related billings. If there is a net liability it is presented as billings on uncompleted contracts in excess of related costs. We provide for any loss that we expect to incur on a contract at the time the loss is probable. | |
At December 31, 2013, the Company had costs of uncompleted contracts in excess of related billings totaling $119,758. This amount was netted with the accrued loss contract on the Company’s balance sheet. | |
Research and Development Costs | |
All costs related to research and development are expensed when incurred. Research and development costs consist of expenses associated with the development of the Company’s Power on Demand system and micro-grids. Specifically, these costs consist of labor, materials and consultants. | |
Warranty Costs | |
The Company’s standard warranty on each turbine sold protects against defects in design, material and workmanship under normal use for up to a six-year period, however there are several warranties which have different terms and conditions. Warranties on solar PV systems and Power on Demand systems are offered based upon the manufacturer’s product warranty, therefore, no reserve is required for these systems. The Company provides for estimated cost of warranties at the time the revenue is recognized. Factors that affect the warranty reserve are projected cost of repair and/or replacement, component life cycles, and limited historical data. As a result of lower than expected wind turbine performance, many customers have elected to replace their wind turbine with a similarly sized solar PV array. We have taken this into consideration when evaluating the warranty reserves, and have included the cost of replacement as part of the warranty expense. The impact of any change in estimates will be taken into account when analyzing future warranty reserve requirements. | |
Stock-Based Compensation | |
The Company accounts for stock option awards granted under the Company’s Equity Incentive Plan in accordance with ASC 718. Under ASC 718, compensation expense related to stock-based payments is recorded over the requisite service period based on the grant date fair value of the awards. Compensation previously recorded for unvested stock options that are forfeited is reversed upon forfeiture. The Company uses the Black-Scholes option pricing model for determining the estimated fair value for stock-based awards. The Black-Scholes model requires the use of assumptions which determine the fair value of stock-based awards, including the option’s expected term and the price volatility of the underlying stock. | |
The Company’s accounting policy for equity instruments issued to consultants and vendors in exchange for goods and services follows the provisions of ASC 505-50. Accordingly, the measurement date for the fair value of the equity instruments issued is determined at the earlier of (i) the date at which a commitment for performance by the consultant or vendor is reached or (ii) the date at which the consultant’s or vendor’s performance is complete. In the case of equity instruments issued to consultants, the fair value of the equity instrument is recognized over the term of the consulting agreement, or vesting period, whichever is shorter. | |
Income Taxes | |
The Company accounts for income taxes using the asset and liability approach, which requires recognition of deferred tax liabilities and assets for the expected future tax consequences of temporary differences between the carrying amounts and the tax basis of such assets and liabilities. This method utilizes enacted statutory tax rates in effect for the year in which the temporary differences are expected to reverse and gives immediate effect to changes in income tax rates upon enactment. Deferred assets are recognized, net of any valuation allowance, for temporary differences and net operating loss and tax credit carry forwards. Deferred income tax expense represents the change in net deferred assets and liability balances. | |
Concentrations of Customers and Suppliers | |
The Company’s largest customer accounted for 29% of 2013 sales (54% of 2012 sales), and this customer’s accounts receivable represented 45% of total accounts receivable as of December 31, 2013 (68% as of December 31, 2012). | |
We purchase a significant portion of our solar PV products from a single supplier, and as such receive certain discounts due to purchase volumes. Purchases from this vendor totaled 33% of our material cost of goods sold for the year ended December 31, 2013. There are numerous alternative suppliers that could supply the materials and components used in our solar PV installations, and we believe that utilizing our current supplier will not have an adverse effect on our business. | |
Basic and Diluted Loss Per Share | |
Basic earnings per share reflect the actual weighted average of shares issued and outstanding during the period. Diluted earnings per share are computed including the number of additional shares that would have been outstanding if dilutive potential shares had been issued. In a loss year, the calculation for basic and diluted earnings per share is considered to be the same, as the impact of potentially issued common shares would be anti-dilutive. | |
As of December 31, 2013, there were 1,386,108 stock options and 7,671,267 warrants outstanding that, upon exercise, could dilute future earnings. | |
Reclassifications | |
Certain prior year amounts have been reclassified to conform to the current year presentation. |
Going_Concern
Going Concern | 12 Months Ended |
Dec. 31, 2013 | |
Going Concern [Abstract] | ' |
Going Concern | ' |
Note 2 - Going Concern | |
The financial statements have been prepared assuming that the Company will continue as a going concern. The Company has generated sales volumes of $5.5 million over a four year period, and has incurred cumulative net loss of $27,034,691 since inception. Our sales volumes to date and recurring losses from operations raise substantial doubt about the Company’s ability to continue as a going concern. Continuation of the Company is dependent on achieving sufficiently profitable operations and obtaining additional financing. | |
In July of 2013, the Company sold 5.0 million shares of common stock which yielded net proceeds of $1,245,000. Stock offering costs were minimal. This working capital may not be sufficient to fund operational growth, and the Company expects to need to raise additional capital. There can be no assurance that the Company will continue to be able to raise sufficient capital, at terms that are favorable to the Company or at all, to fund operations. |
Longlived_Assets
Long-lived Assets | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Long Lived Assets [Abstract] | ' | ||||||||
Long-lived Assets | ' | ||||||||
Note 3 – Long-lived Assets | |||||||||
The following table summarizes the Company’s long-lived assets as of: | |||||||||
December 31, | December 31, | ||||||||
2013 | 2012 | ||||||||
Property and equipment | |||||||||
Equipment | $ | 264,495 | $ | 253,718 | |||||
Furniture and fixtures | 38,950 | 38,950 | |||||||
Software | 71,625 | 71,625 | |||||||
Total property and equipment before accumulated depreciation | 375,070 | 364,293 | |||||||
Less accumulated depreciation | (305,515 | ) | (242,706 | ) | |||||
Total property and equipment | $ | 69,555 | $ | 121,587 | |||||
Intangible assets | |||||||||
Patents | $ | 34,862 | $ | 34,862 | |||||
Trademark | 0 | 4,525 | |||||||
Total intangible assets before accumulated amortization | 34,862 | 39,387 | |||||||
Less accumulated amortization | (9,557 | ) | (8,674 | ) | |||||
Total intangible assets | $ | 25,305 | $ | 30,713 | |||||
Impairments of assets for the year ended December 31, 2013 totaled $3,699 as compared to $33,302 for the year ended December 31, 2012. The impairment for 2013 related to the WindTamer™ trademark, while impairment costs in 2012 related primarily to tooling for the Company’s wind turbine components. |
Debt
Debt | 12 Months Ended | ||||
Dec. 31, 2013 | |||||
Debt [Abstract] | ' | ||||
Debt | ' | ||||
Note 4 – Debt | |||||
In August 2011 the Company purchased equipment for $44,748, financed with a loan from Canandaigua National Bank. The loan is guaranteed by William Schmitz, CEO of the Company, has a 60-month term, and carries a 4.99% annual interest rate. Monthly payments are $844. In October 2011 the Company leased office equipment for $9,068 financed with a loan from Canon Financial Services, Inc. The loan, with monthly payments of $279, has a 6.76% annual interest rate and a 36 month term. The end of term purchase option calls for payment of the equipment’s fair market value. | |||||
On September 4, 2012, the Company entered into an unsecured loan agreement with TMK-ENT, Inc. that provided for a $500,000 working capital revolving line of credit. Advances under the line of credit bear interest at 10% per year, payable annually. On November 13, 2012, the Company amended its loan agreement to increase the revolving line of credit agreement from $500,000 to $750,000, and on December 21, 2012 amended its loan agreement to increase the revolving credit agreement for $750,000 to $1,250,000 The note originally matured on December 21, 2013, however on May 29, 2013 the note was amended to extend the maturity date to December 21, 2014. Borrowings under the line of credit amount to $1,018,500 as of December 31, 2013 ($748,500 as of December 31, 2012). In conjunction with the line of credit facility, the Company issued 1,250,000 warrants to purchase the Company’s common stock at varying prices from $1.38 to $1.62 per share. The warrants vest one year from issuance and have a ten year term. The fair market value of the warrants at grant date was determined utilizing the Black Scholes option pricing model and amounted to $1,839,250. As of December 31, 2012, the Company had drawn $1,018,500 on the line of credit. The difference between the fair market value of the warrants and draws on the line of credit is $820,750 as of December 31, 2013($1,090,750 as of December 31, 2012), which is recorded as deferred debt discount. The deferred debt discount will be recognized and recorded as debt discount as the Company continues to borrow against the line of credit. Debt discount costs will be recognized as the Company draws down the available line of credit, and will be amortized over the remaining term of the loan. As a result of the amortization of the debt discount, the Company expensed $ 518,481 for the year ended December 31, 2013 and $166,513 for the year ended December 31, 2012. | |||||
Annual maturities of debt are as follows: | |||||
2014 | $ | 1,030,282 | |||
2015 | $ | 9,540 | |||
2016 | $ | 6,629 |
Stockholders_Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2013 | |
Stockholders' Equity [Abstract] | ' |
Stockholders' Equity | ' |
Note 5 – Stockholders’ Equity | |
In January 2013, the Company issued 10,000 shares of common stock to an attorney for services rendered, which totaled $10,000. | |
On February 4, 2013, the Company entered into a lease modification, a purchase agreement and a warrant to purchase common stock with 1999 Mt. RB, LLC, the Company’s landlord at 1999 Mt. Read Boulevard, Rochester, New York. Pursuant to the terms and conditions of the purchase agreement, the Company sold to 1999 Mt. RB 390,394 shares of our common stock in exchange for (1) the satisfaction of amounts due to 1999 Mt. RB pursuant to the original lease and (2) free rent, CAM charges and real estate taxes from February 1, 2013 through November 30, 2013 pursuant to the lease amendment. Pursuant to the terms and conditions of the warrant agreement, the Company issued to 1999 Mt. RB a warrant to purchase up to 600,000 shares of the Company’s common stock for a purchase price of $1.00 per share. The warrant vested in full upon issuance, and expires on February 4, 2014. The warrant and purchase agreement have customary anti-dilution protections. The fair value of the warrants at grant date was determined utilizing the Black Scholes option pricing model, and amounted to $256,800, which will be amortized over the lease term. Of this amount, $40,415 was expensed in 2013, $44,023 is recorded as a prepaid asset, and $172,362 is recorded as another asset and will be amortized in a period that exceeds one year. On July 31, 2013, pursuant to terms of the warrant, the purchase price was automatically adjusted to $0.25 per share as a result of the Company selling shares of stock on such date in a private placement for $0.25 per share. The warrants were not exercised by February 4, 2014, and expired. | |
In May, 2013, the Company entered into a strategic advisory agreement with Sunrise Financial Group, Inc., pursuant to which, Sunrise will provide the Company with prospective customer listings and introductions to building owners and managers. In accordance with the agreement, the Company agreed to issue 620,341 warrants at $.73 per share. The warrants carry a five year term, and have customary anti- dilution clause, and have been valued as a derivate liability. The fair value of the warrants at grant date was determined utilizing the Black Scholes option pricing model, and amounted to $299,044, which will be amortized over the term of the agreement. Of this amount, $183,521 was expensed in 2013 and $115,523 is recorded as a prepaid asset. | |
On July 31, 2013, the Company sold pursuant to a securities purchase agreement an aggregate of 4,420,000 shares of its common stock and five-year warrants, which vested in full upon issuance, to purchase a total of 2,210,000 additional shares of common stock at a purchase price of $0.30 per share to 12 institutional and private investors for a total of $1,105,000 in gross proceeds from the sales. On August 8, 2013, the Company sold pursuant to a securities purchase agreement an aggregate of 600,000 shares of its common stock and five-year warrants, which vested in full upon issuance, to purchase a total of 300,000 additional shares of common stock at a purchase price of $0.30 per share for a total of $150,000 in gross proceeds. Legal costs, which amounted to $10,000, were netted against the proceeds. The warrant and securities purchase agreement have customary anti-dilution protection and registration rights. The warrants carry a five year term, and have customary anti-dilution clause, and have been valued as a derivate liability. The fair value of the warrants at grant date was determined utilizing the Black Scholes option pricing model, amounted to $895,800, and was netted against the proceeds of the private placement for a total increase in stockholders’ equity of $349,200 relating to these transactions. The shares and warrants associated with this private placement have been registered with the Securities and Exchange Commission. | |
On July 31, 2013, the Company issued warrants to purchase 550,000 shares of common stock to two consultants to work with the Company on marketing and lead generation. The warrants have a 5 year term, vest immediately and have an exercise price of $0.30 per share, which is subject to customary anti-dilution protection and registration rights. | |
For the year ended December 31, 2012, the Company issued 152,959 shares of common stock to strategic vendors and consultants for goods and services totaling $289,015. During 2012, the Company raised capital through the private placement sales of “units” consisting 7,500 shares of common stock and a warrant to purchase 1,000 shares of common stock for $10 per share. The warrants vest fully two years from the date of unit purchase and have a ten year term. The Company sold 53 units which yielded $795,000. | |
For the year ended December 31, 2013 and 2012, total stock option expense amounted to $695,250 and $578,887, respectively. In 2013, 1,735,208 stock options were granted, while in 2012 178,000 stock options were granted. Of the options granted in 2013, 520,208 options were granted under the 2008 Equity Incentive Plan, while all of the options granted in 2012 were granted under the 2008 Equity Incentive Plan. | |
On December 13, 2010, the Board of Directors approved a plan whereby certain employees were issued restricted shares of common stock in lieu of future salary cash payments. The employees forfeited salary over a twelve week period to purchase the common shares, which were valued at fair market value as of the date of grant. The Compensation Committee of the Company’s Board of Directors have approved a change in the vesting date for restricted stock held by certain employees from April 1, 2011 to April 1, 2014. A total of 55,969 shares vested on April 1, 2011, 50,989 vested on August 20, 2013 and the remaining 118,379 shares are scheduled to vest on April 1, 2014. |
StockBased_Compensation
Stock-Based Compensation | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Stock Based Compensation [Abstract] | ' | ||||||||||||||||
Stock-Based Compensation | ' | ||||||||||||||||
Note 6 – Stock-Based Compensation | |||||||||||||||||
The Company has established the “2008 Equity Incentive Plan,” which is a shareholder approved plan that permits the granting of stock options and restricted stock to employees, directors and consultants. The 2008 Equity Incentive Plan originally provided for the issuance of up to 400,000 shares of common stock of which 50,000 shares are available for grant as Incentive Stock Options. The exercise price for options awarded is no less than 100% of the fair market value of the common stock on the day of grant. The options generally vest either immediately on the date of grant or 1 to 3 years from the date of grant. On December 30, 2009, the Board of Directors approved an amendment to increase the number of shares available for award under the plan from 400,000 to 800,000, and this amendment was approved by the Company’s shareholders at its Annual Meeting on April 28, 2010. In March of 2012, the Board of Directors approved an amendment to increase the number of shares available for award under the plan to 1,550,000. This amendment was approved by shareholders at the Annual Meeting of Shareholders on May 9, 2012. In March 2014, the Board of Directors of the Company approved an amendment to increase the number of shares available for award under the plan by 2.0 million shares, to 3,550,000. This amendment will be proposed to shareholders for vote at the Annual Meeting of Shareholders to be held on May 28, 2014. For 2013, compensation costs relating to the issuance of stock options and warrants amounted to $584,671 and the expense associated with repricing options and warrants amounted to $110,579. For 2012, compensation costs relating to the issuance of stock options and restricted stock amounted to $543,267 and the expense associated with repricing of options and warrants amounted to $38,673. | |||||||||||||||||
On January 22, 2013 the Board of Directors of the Company approved the repricing of 25,000 outstanding compensatory options to purchase common stock of the Company held by a consultant of the Company, Michael Hughes, an attorney who has provided and continues to provide legal services to the Company as outside counsel and is now the Company’s Director of Strategy and Legal Affairs, previously granted under the Amended and Restated 2008 Equity Incentive Plan. As a result, the exercise price of the options was lowered to $1.20 per share, an amount equal to the last trade of the Common Stock on the OTC Bulletin Board on January 22, 2013. There was no change in the number of shares subject to each option, vesting or other terms of the options. For the three months ended March 31, 2013, the Company recorded expenses totaling $13,575 associated with the repricing. | |||||||||||||||||
On July 31, 2013, the Compensation Committee of the Board of Directors of Arista Power approved the repricing of all outstanding stock options to purchase common stock of the Company held by officers, other employees, current and former non-employee directors, employees and certain independent contractors with exercise prices in excess of $0.75 per share. As a result, the exercise price of the options was lowered to $0.75 per share. There was no change in the number of shares subject to each option, vesting or other terms of the options. The Compensation Committee of the Board of Directors effectuated the repricing to realign the value of the options with their intended purpose, which is to retain and motivate the holders of the options to continue to work in the best interests of Arista Power. Prior to the repricing, many of the options had exercise prices well above the recent market prices of the Company's common stock on the OTCQB. As a result of the repricing, the Company recorded an expense of $34,381. | |||||||||||||||||
On November 8, 2012, the Board of Directors of the Company approved the repricing of 85,000 outstanding compensatory options to purchase common stock of the Company held by executive officers of the Company previously granted under the Amended and Restated 2008 Equity Incentive Plan. As a result, the exercise price of the options was lowered to $1.67 per share, an amount equal to the last trade of the common stock on the OTCQB on November 8, 2012. There was no change in the number of shares subject to each option, vesting or other terms of the options. The Company repriced 75,000 and 10,000 Options held by William A. Schmitz, the Company’s Chief Executive Officer and President, and Molly Hedges, the Company’s Chief Financial Officer and Vice President of Finance, respectively. | |||||||||||||||||
The Company has valued the options at their date of grant utilizing the Black-Scholes Option Pricing Model. Expected volatility is based upon a weighted average historical volatility of the Company’s common stock, and that of peer companies operating in a similar industry. The risk-free interest rate is based on the implied yield available on U.S. Treasury issues with an equivalent term approximating the expected life of the options depending on the date of the grant and expected life of the options. The expected life of options was based on its term. The Company determined the expected dividend rate based on the assumption and expectation that earnings generated from operations are not expected to be adequate to allow for the payment of dividends in the near future. The following weighted-average assumptions were utilized in the fair value calculations for options granted: | |||||||||||||||||
Year ended | |||||||||||||||||
December 31, | December 31, | ||||||||||||||||
2013 | 2012 | ||||||||||||||||
Expected dividend yield | 0 | % | 0 | % | |||||||||||||
Expected stock price volatility | 105-108 | % | 109-112 | % | |||||||||||||
Risk-free interest rate | 2.68-3.58 | % | 2.32-2.70 | % | |||||||||||||
Expected life of options | .03-9.71 Years | 1.5-9.5 Years | |||||||||||||||
The following table summarizes the status of the Company’s aggregate stock options granted: | |||||||||||||||||
Number of | Weighted | Weighted-Average Remaining | Aggregate | ||||||||||||||
Shares | Average | Contractual | Intrinsic | ||||||||||||||
Remaining | Exercise | Term | Value | ||||||||||||||
Options | Price | ||||||||||||||||
Outstanding at January 1, 2013 | 516,400 | $ | 3.25 | ||||||||||||||
Options granted during 2013 | 1,735,208 | $ | 0.45 | ||||||||||||||
Options expired/cancelled during 2013 | 865,500 | $ | 0.41 | ||||||||||||||
Outstanding at December 31, 2013 | 1,386,108 | $ | 0.61 | 7.1 | $ | 0 | |||||||||||
Exercisable at December 31, 2013 | 612,308 | $ | 0.87 | 5.3 | $ | 0 | |||||||||||
The weighted average fair value of options granted during twelve months ended December 31, 2012 was approximately $.45 ($2.05 for the twelve months ended December 31, 2012.) During the twelve months ended December 31, 2012, 1,735,208 options were granted, 865,500 options expired or were cancelled, and no options were exercised. During the twelve months ended December 31, 2012, 178,000 options were granted, 26,000 expired or were cancelled, and no options were exercised. Of the 1,655,000 options granted in 2013, 520,508 were granted under the 2008 Equity Incentive Plan. | |||||||||||||||||
On December 13, 2010, the Board of Directors approved a plan whereby certain employees were issued restricted shares of common stock in lieu of future salary cash payments. The employees forfeited salary over a twelve week period to purchase the common shares, which were valued at fair market value as of the date of grant. The Compensation Committee of the Company’s Board of Directors have approved a change in the vesting date for restricted stock held by certain employees from April 1, 2011 to April 1, 2014. A total of 55,969 shares vested on April 1, 2011, 50,989 vested on August 20, 2013 and the remaining 118,379 shares are scheduled to vest on April 1, 2014. | |||||||||||||||||
The table below summarizes the status of the Company’s restricted stock awards: | |||||||||||||||||
Number of | Weighted | ||||||||||||||||
Restricted Shares | Restricted | Average | |||||||||||||||
Shares | Fair Value at | ||||||||||||||||
Grant Date | |||||||||||||||||
Non-vested at December 31, 2012 | 169,368 | $ | 2.8 | ||||||||||||||
Vested – 2013 | 50,989 | $ | 2.8 | ||||||||||||||
Non-vested at December 31, 2013 | 118,379 | $ | 2.8 |
Warrants
Warrants | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Warrants Disclosure [Abstract] | ' | ||||||||||||||||
Warrants | ' | ||||||||||||||||
Note 7 – Warrants | |||||||||||||||||
The Company has valued warrants at their date of issue utilizing the Black-Scholes Option Pricing Model. The risk-free interest rate is based on the implied yield available on U.S. Treasury issues with an equivalent term approximating the expected life of the warrants depending on the date of the issue and their expected life. The expected life of warrants used was based on the term of the warrant. The Company determined the expected dividend rate based on the assumption and expectation that earnings generated from operations are not expected to be adequate to allow for the payment of dividends in the near future. The following weighted-average assumptions were utilized in the fair value calculations for warrants granted: | |||||||||||||||||
Year ended | Year ended | ||||||||||||||||
December 31, | December 31, | ||||||||||||||||
2013 | 2012 | ||||||||||||||||
Expected dividend yield | 0 | % | 0 | % | |||||||||||||
Expected stock price volatility | 93-108 | % | 105-113 | % | |||||||||||||
Risk-free interest rate | .14-2.60 | % | 2.06-3.03 | % | |||||||||||||
Expected life of warrants | .1-9.1 Years | 7.3-9.8 Years | |||||||||||||||
The following table summarizes the status of the Company’s warrants granted: | |||||||||||||||||
Number of | Weighted | Weighted-Average Remaining | Aggregate | ||||||||||||||
Shares | Average | Contractual Term | Intrinsic | ||||||||||||||
Remaining | Exercise | Value | |||||||||||||||
Warrants | Price | ||||||||||||||||
Outstanding at January 1, 2013 | 2,954,250 | $ | 3.8 | 8.5 | |||||||||||||
Warrants granted during 2013 | 4,717,017 | 0.43 | 4.38 | ||||||||||||||
Warrants expired/cancelled during 2013 | 0 | ||||||||||||||||
Outstanding at December 31, 2013 | 7,671,267 | $ | 1.51 | 5.58 | $ | 150,000 | |||||||||||
Exercisable at December 31, 2013 | 6,861,250 | $ | 1.53 | 6.6 | $ | 150,000 | |||||||||||
The weighted average fair value of warrants issued during twelve months ended December 31, 2013 was $.43 ($1.94 for the year ended December 31, 2012). During the year ended December 31, 2013, 5,369,250 warrants vested, none expired or were cancelled, and no warrants were exercised. For the year ended December 31, 2012, 404,500 warrants vested, none expired or were cancelled, and no warrants were exercised. | |||||||||||||||||
For 2013, the Company recorded compensation costs of $368,927 for 416,666 warrants issued to a consultant/outside counsel of the Company. The warrants have a ten year life, a $1.20 exercise price. 250,000 of these warrants vested on the 6-month anniversary of the grant, and 166,666 of these warrants will vest on the two-year anniversary of the grant. | |||||||||||||||||
On January 22, 2013 the Board of Directors of the Company approved the repricing of 423,125 outstanding warrants to purchase common stock of the Company held by a former consultant of the Company and current Director of Strategy and Legal Affairs of the Company, Michael Hughes, an attorney who has provided and continues to provide legal services to the Company. As a result, the exercise price of the options was lowered to $1.20 per share, an amount equal to the last trade of the Company’s common stock on January 22, 2013. There was no change in the number of shares subject to each warrant, vesting or other terms of the warrants. The Company recorded expenses totaling $76,198 associated with the repricing for the three month period ending March 31, 2013. Mr. Hughes became an employee of the Company in July, 2013. | |||||||||||||||||
On November 8, 2012, the Board of Directors of the Company approved the repricing of 172,500 outstanding warrants to purchase common stock of the Company held by executive officers of the Company. As a result, the exercise price of the warrants was lowered to $1.67 per share, an amount equal to the last trade of the common stock on November 8, 2012. There was no change in the number of shares subject to each warrant, vesting or other terms of the warrants. The Company repriced 115,000 and 57,500 warrants held by William A. Schmitz, the Company’s Chief Executive Officer and President, and Molly Hedges, the Company’s Chief Financial Officer and Vice President of Finance, respectively. For the year ended December 31, 2012, the Company recorded expenses totaling $24,323 associated with the repricing. |
Derivative_Liabilities
Derivative Liabilities | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||
Derivative Liabilities | ' | ||||||||||||||||
Note 8 – Derivative Liabilities | |||||||||||||||||
Certain warrants issued by the Company do not have fixed settlement provisions because their exercise prices may be lowered if the Company issues securities at lower prices in the future, are classified as derivative liabilities, and are revalued at each reporting date. These warrants include (1) warrants issued to 1999 Mt RB, LLC in conjunction with our lease modification on February 4, 2013 (2) warrants issued conjunction with the Company’s strategic advisory agreement with Sunrise Financial Group, Inc. on May 21, 2013 and (3) warrants issued in conjunction with the Company’s private placements on July 31, 2013 and August 6, 2013. The Company was required to include the reset provisions in order to protect the warrant holders from the potential dilution associated with future financings. | |||||||||||||||||
The Company has valued warrants at their date of issue utilizing the Black-Scholes option pricing model. Expected volatility is based upon a weighted average historical volatility of peer companies operating in a similar industry. The risk-free interest rate is based on the implied yield available on U.S. Treasury issues with an equivalent term approximating the expected life of the warrants depending on the date of the issue and their expected life. The expected life of warrants used was based on the term of the warrant. The Company determined the expected dividend rate based on the assumption and expectation that earnings generated from operations are not expected to be adequate to allow for the payment of dividends in the near future. The following weighted-average assumptions were utilized in the fair value calculations for warrants granted and subsequent revaluation: | |||||||||||||||||
Year Ended | |||||||||||||||||
December 31, | |||||||||||||||||
2013 | |||||||||||||||||
Expected dividend yield | 0 | % | |||||||||||||||
Expected stock price volatility | 70-172 | % | |||||||||||||||
Risk-free interest rate | .08–1.75 | % | |||||||||||||||
Expected life of warrants | .1-4.59 years | ||||||||||||||||
Number of warrants | 4,300,351 | ||||||||||||||||
Fair value of warrants | $ | 775,596 | |||||||||||||||
The fair value of these warrant liabilities was $775,596 at December 31, 2013. Of this amount, $13,200 is reported as a short term liability, as the warrants associated with this derivative liability will expire in less than one year. The reminder, $762,396 is classified as a long-term liability. The change in fair value for 2013 was ($676,048) and is reported in our statement of operations as an unrealized gain on the change in fair value of the derivative liabilities. The fair value of the derivative liabilities are re-measured at the end of every reporting period and upon the exercise of the warrant. | |||||||||||||||||
Fair Value Measurement | |||||||||||||||||
Valuation Hierarchy | |||||||||||||||||
ASC 820, “Fair Value Measurements and Disclosures,” establishes a valuation hierarchy for disclosure of the inputs to valuation used to measure fair value. This hierarchy prioritizes the inputs into three broad levels as follows. Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument. Level 3 inputs are unobservable inputs based on the Company’s own assumptions used to measure assets and liabilities at fair value. A financial asset or liability’s classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. | |||||||||||||||||
The following table provides the liabilities carried at fair value measured on a recurring basis as of December 31, 2013: | |||||||||||||||||
Fair Value Measurements at December 31, 2013 | |||||||||||||||||
Total | Quoted | Significant | Significant | ||||||||||||||
Carrying | prices in | other | unobservable | ||||||||||||||
Value at | active | observable | inputs | ||||||||||||||
September 30, | markets | inputs | (Level 3) | ||||||||||||||
2013 | (Level 1) | (Level 2) | |||||||||||||||
Derivative liabilities | $ | 775,596 | $ | - | $ | - | $ | 775,596 | |||||||||
The derivative liabilities are measured at fair value using quoted market prices and estimated volatility factors, and are classified within Level 3 of the valuation hierarchy. | |||||||||||||||||
The following table sets forth a summary of the changes in the fair value of our Level 3 financial liabilities that are measured at fair value on a recurring basis: | |||||||||||||||||
Year ended | |||||||||||||||||
December 31, | |||||||||||||||||
2013 | |||||||||||||||||
Beginning balance January 1, 2013 | $ | 0 | |||||||||||||||
Initial valuation of derivative financial instruments | 1,451,644 | ||||||||||||||||
Net unrealized (gain) loss on derivative financial instruments | -676,048 | ||||||||||||||||
Ending balance | $ | 775,596 |
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Commitments and Contingencies [Abstract] | ' | ||||||||
Commitments and Contingencies | ' | ||||||||
Note 9 – Commitments and Contingencies | |||||||||
In October 2010, we executed a lease for our Rochester facility at 1999 Mt Read Boulevard (a four building complex). The lease term was from August 2010 through July 2015. The first year of the lease term required monthly base rent payments of $5,396, payable in cash or in the Company’s common stock. The base rent increases by 3% on August 1st of the each year of the lease. The Company also is required to pay its proportionate share of real estate taxes and common area maintenance costs for the Rochester facility. | |||||||||
On February 4, 2013, the Company entered into a lease modification, a purchase agreement and a warrant to purchase common stock with 1999 Mt. RB, LLC, the Company’s landlord at 1999 Mt. Read Boulevard, Rochester, New York. | |||||||||
Pursuant to the terms and conditions of the purchase agreement, the Company sold to 1999 Mt. RB 390,394 shares of our common stock in exchange for (1) the satisfaction of amounts due to 1999 Mt. RB pursuant to the original lease and (2) free rent, common area maintenance charges and real estate taxes from February 1, 2013 through November 30, 2013 pursuant to the lease amendment. Pursuant to the terms and conditions of the warrant agreement, the Company issued to 1999 Mt. RB a warrant to purchase up to 600,000 shares of the Company’s common stock for a purchase price of $1.00 per share. The warrant vested in full upon issuance, and expired on February 4, 2014. On July 31, 2013, pursuant to the terms of the warrant, the exercise price was automatically adjusted to $0.25 per share as a result of the Company selling shares of stock on such date in a private placement for $0.25 per share. | |||||||||
The lease amendment amended the original lease between the Company and 1999 Mt. RB, and provides, among other things: (1) the leasing of approximately 20,096 square feet at 1999 Mt. Read Boulevard, Rochester, New York; (2) a lease term that runs from February 1, 2013 through November 30, 2018, (3) two five-year renewal options at the option of Arista Power; (4) the Free Rent Period ( from February 1, 2013 through November 30, 2013); and (5) base rent starting on November 30, 2013 at a price of $3.50 per square foot per year with annual increases of 3%. In addition, the Company must pay all future rent in cash. | |||||||||
Annual cash commitments by year under the Company’s lease agreements are as follows: | |||||||||
Cash rental | |||||||||
commitment | |||||||||
2014 | $ | 70,512 | |||||||
2015 | $ | 72,627 | |||||||
2016 | $ | 74,806 | |||||||
2017 | $ | 77,050 | |||||||
2018 | $ | 72,567 | |||||||
Warranty | |||||||||
During the years ended December 31, 2013 and 2012, the Company entered into a number of sales orders for Power on Demand systems, solar PV installations and wind turbine installations. These sales orders required certain deposits of the agreed-upon purchase price upon acceptance of the sales order. The advance payments received as of December 31, 2013 amounted to $19,000 ($127,239 as of December 31, 2012) and have been included in customer deposits. We expect to install the units associated with these deposits during the next two quarters, as we obtain permits and zoning approvals from customer’s town officials, obtain NYSERDA approvals, complete site assessments, and continue product evaluation. The sales orders included product warranties of varying periods, depending on the product sold, against defects in materials and workmanship. The Company provides for estimated cost of warranties at the time the revenue is recognized and has established a corresponding warranty reserve. Factors that affect the balance required in the warranty reserve are projected cost of repair and/or replacement, component life cycles, manufacturer’s warranty on parts and components, and limited historical data. As a result of lower than expected wind turbine performance, many customers have elected to replace their wind turbine with a similarly sized solar PV array. We have taken this into consideration when evaluating the warranty reserves, and have included the cost of replacement as part of the warranty expense. These estimates are reviewed quarterly and are updated as new information becomes available. The impact of any change in warranty cost estimates will be taken into account when analyzing future warranty reserve requirements. As of December 31, 2013 and 2012, the Company’s warranty reserve totals $140,074. The following table summarizes the activity in the accrued warranty account: | |||||||||
December 31, | December 31, | ||||||||
2013 | 2012 | ||||||||
Balance as of beginning of year | $ | 140,074 | $ | 135,606 | |||||
Warranty costs accrued | 0 | 32,816 | |||||||
Settlements made | 0 | (28,348 | ) | ||||||
Balance as of end of year | $ | 140,074 | 140,074 | ||||||
Employment Agreements | |||||||||
On July 29, 2013, each of William Schmitz, Chief Executive Officer, Molly Hedges, Chief Financial Officer, Mark Matthews, then President, and Adeeb Saba, then Vice President of Operations and currently Chief Operating Officer, entered into a termination of employment agreement with Arista Power. Pursuant to such termination of employment agreements, each of the executives terminated their respective employment agreements with Arista Power, effective July 29, 2013 and each of the executives agreed to become at-will employees. Accordingly, the Company is no longer liable for certain severance provisions for compensation under the terminated employment agreements. |
Income_Taxes
Income Taxes | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Income Taxes [Abstract] | ' | ||||||||
Income Taxes | ' | ||||||||
Note 10 - Income Taxes | |||||||||
Following is a summary of the components giving rise to the income tax provision (benefit) for the periods ended December 31: | |||||||||
Year ended | |||||||||
2013 | 2012 | ||||||||
Current | $ | (103,471 | ) | $ | (158,895 | ) | |||
Deferred | (1,195,703 | ) | (1,386,246 | ) | |||||
Less increase in allowance | 1,195,703 | 1,386,246 | |||||||
Net deferred | – | – | |||||||
Total income tax provisions (benefit) | $ | -103,471 | $ | (158,895 | ) | ||||
Individual components of the deferred tax asset are as follows as of December 31: | |||||||||
Year ended | |||||||||
2013 | 2012 | ||||||||
Net operating loss carryforwards | $ | 5,067,659 | $ | 4,107,084 | |||||
Stock based compensation | 4,084,116 | 3,848,988 | |||||||
Depreciation and amortization | 289,345 | 289,345 | |||||||
Tax credit carryforward | 107,854 | 107,854 | |||||||
Total | 9,548,974 | 8,353,271 | |||||||
Less valuation allowance | (9,548,974 | ) | (8,353,271 | ) | |||||
Net deferred tax assets | $ | – | $ | – | |||||
The Company has approximately $14,434,000 of net operating loss carryforwards (“NOLs”) available to reduce future taxable income. These NOLs expire at various dates through 2033. Due to the uncertainty as to the Company’s ability to generate sufficient taxable income in the future and utilize the NOLs before they expire, the Company has recorded a valuation allowance to offset the deferred tax assets. | |||||||||
Internal Revenue Code Section 382 (“Section 382”) imposes limitations on the availability of a company’s net operating losses and other corporate tax attributes as ownership changes occur. As a result of the transactions discussed in Notes 5 and 6, a Section 382 ownership change is expected and a study will be required to determine the date of the ownership change. The amount of the Company’s net operating losses and other tax attributes incurred prior to the ownership change may be limited based on the value of ownership change. A full valuation allowance has been established for the gross deferred tax asset related to the net operating losses and other corporate tax attributes available. Accordingly, any limitation resulting from Section 382 application is not expected to have a material effect on the balance sheet or statements of operations of the Company. | |||||||||
The differences between the United States statutory federal income tax rate and the effective income tax rate in the accompanying consolidated statements of operations are as follows: | |||||||||
Year ended | |||||||||
2013 | 2012 | ||||||||
Tax benefit at statutory United States federal rate | $ | (1,112,800 | ) | $ | (1,186,565 | ) | |||
State income tax credit net of federal benefit | (136,634 | ) | (187,427 | ) | |||||
Permanent items | (49,740 | ) | |||||||
Tax credits | 0 | (107,034 | ) | ||||||
Adjustments from prior year | 0 | (64,115 | ) | ||||||
Change in valuation reserves | 1,195,703 | 1,386,246 | |||||||
Current tax (expense) income | (103,471 | ) | (158,895 | ) | |||||
Effective tax rate (%) | 3 | % | 4 | % | |||||
Actual cash payments for taxes in 2013 and 2012 were $500. In April, 2013, the Company received $103,971 as a New York State Qualified Emerging Technology Company tax credit for the year ended December 31, 2011, which was recorded as income by the Company. In December 2011, the Company approved a Consent to Desk Audit Adjustment providing the Company with a New York State Qualified Emerging Technology Company tax credit of $159,395 for the year ended December 31, 2010. The cash refund was received by and recorded as income by the Company in January 2012. | |||||||||
In July 2006, the FASB released Interpretation No. 48, “Accounting for Uncertainty in Income Taxes – an Interpretation of FASB Statement 109” (“FIN48”), now ASC 740. Effective for fiscal years beginning after December 15, 2006, FIN48 provides guidance on the financial statement recognition and measurement for income tax positions that we have taken or expect to take in our income tax returns. It also provides related guidance on under-recognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. We adopted the provisions of FIN48 on January 1, 2007. The adoption did not have a material impact on the Company’s consolidated results of operations and financial position, and therefore, the Company did not have any adjustment to the January 1, 2007 beginning balance of retained earnings. In addition, the Company did not have any material unrecognized tax benefits at December 31, 2013 or 2012. | |||||||||
The Company recognizes interest and penalties related to unrecognized tax benefits in general and administrative expense. During the years ended December 31, 2013 and 2012, the Company recognized no material interest and penalties. | |||||||||
The Company files income tax returns in the U.S. federal jurisdiction and applicable states. The tax years 2008 through 2013 remain open to examination by major taxing jurisdictions to which the Company is subject. |
Subsequent_Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2013 | |
Subsequent Events [Abstract] | ' |
Subsequent Events | ' |
Note 11 – Subsequent Events | |
On March 31, 2014, the Company sold, pursuant to a securities purchase agreement, an aggregate of 1,500 shares of Series A Convertible Preferred Stock, with a stated value of $1,500,000 that are convertible into shares of the Company’s common stock at a conversion price of $0.20 in stated value per share (7,500,000 shares of common stock), and five-year warrants, which vested in full upon issuance, to purchase up to 11,250,000 additional shares of common stock at a purchase price of $0.25 per share to eight institutional investors. The Company received a total of $1,400,000 in net proceeds from the sales. Each share of Series A Convertible Preferred Stock is entitled to cash interest payments of 9% of the stated value per year, payable quarterly. The Series A Convertible Preferred Stock is voluntarily and mandatorily convertible into shares of common stock pursuant to the provisions of the securities purchase agreement, with any shares of Series A Convertible Preferred Stock outstanding on March 31, 2017 automatically converting into common stock. The investors received rights of first refusal and rights of participation in future financings of the Company until March 31, 2015. In addition, the investors received most favored nation protections on the terms and conditions of the warrants and preferred stock so long as such securities remain outstanding. Additionally, until September 30, 2015, each investor has the right to invest the amount invested by such investor in the above-referenced transaction in Series A Convertible Preferred Stock of Arista Power on substantially similar terms. The Series A Convertible Preferred Stock and warrants have customary anti-dilution protections and registration rights including a “full ratchet” anti-dilution adjustment provision. |
Description_of_Business_and_Su
Description of Business and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Description Of Business and Summary Of Significant Accounting Policies [Abstract] | ' |
Method of Accounting | ' |
Method of Accounting | |
The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Arista Power, Inc. maintains its books and prepares its financial statements on the accrual basis of accounting. | |
Use of Estimates | ' |
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 and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. | |
Cash and Cash Equivalents | ' |
Cash and Cash Equivalents | |
For financial statement presentation purposes, the Company considers all short-term, highly liquid investments with original maturities of three months or less to be cash and cash equivalents. The Company maintains its cash and cash equivalents in bank deposit accounts, which at times may exceed federally insured limits. The Company believes it is not exposed to any significant credit risk as a result of any non-performance by the financial institutions. | |
Accounts Receivable | ' |
Accounts Receivable | |
Accounts receivable are stated at estimated net realizable value. Accounts receivable are comprised of balances due from customers net of estimated allowances for uncollectible accounts, if any. In determining collectability, specific customer issues are reviewed to arrive at appropriate allowances. The allowance for doubtful accounts at December 31, 2013 and 2012 were $0 and $25,200, respectively. | |
Inventory | ' |
Inventory | |
Inventory consists of components for Power on Demand and solar PV systems, and is stated at the lower of cost or market value. The Company capitalizes applicable direct and indirect costs incurred in the Company’s production operations to bring its products to a sellable state. The inventory as of December 31, 2013 consisted of component inventory amounting to $346,014 and work in process inventory of $150,299. Inventory as of December 31, 2012 consisted of component inventory of $197,928 and work in progress inventory of $471,817. Inventory is reviewed quarterly to determine the need for an excess and obsolete inventory reserve. As of December 31, 2013 and 2012, no such reserve was required. For the year ended December 31, 2012, all remaining turbine inventory was written off and disposed of. | |
Fixed Assets | ' |
Fixed Assets | |
Fixed assets are recorded at cost. Depreciation is on a straight line basis over the shorter of the estimated useful lives or the related lease for leasehold improvements. Leasehold improvements for space leased on a month-to-month basis are expensed when incurred. Expenditures for renewals and betterments are capitalized. Expenditures for minor items, repairs and maintenance are charged to operations as incurred. Any gain or loss upon sale or retirement due to obsolescence is reflected in the operating results in the period the event takes place. | |
Intangible Assets | ' |
Intangible Assets | |
Intangible assets consist of costs associated with the application and acquisition of the Company’s patents and trademarks. Patent application costs are capitalized and amortized over the estimated useful life of the patent, which generally approximates its legal life. | |
Impairment of Long-Lived Assets | ' |
Impairment of Long-Lived Assets | |
Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future net undiscounted cash flows expected to be generated by the asset, including its ultimate disposition. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Fair value is determined based on discounted cash flows or appraised values, depending on the nature of the assets. For the year ended December 31, 2013, trademark costs totaling $3,699 relating to the Company’s WindTamer® trademark were impaired, while for the year ended December 31, 2012, the Company impaired assets totaling $33,302 for assets related primarily to tooling for turbine components. | |
Fair Value of Financial Instruments | ' |
Fair Value of Financial Instruments | |
The carrying amount of cash, accounts payable and accrued expenses are reasonable estimates of their fair value due to their short maturity. | |
Revenue Recognition | ' |
Revenue Recognition | |
Revenue is recognized when all of the following conditions are satisfied: (1) there is persuasive evidence of an arrangement; (2) the service or product has been provided to the customer; (3) the sale price to be paid by the customer is fixed or determinable; and (4) the collection of the sale price is reasonably assured. Amounts collected prior to satisfying our revenue recognition policy are reflected as customer deposits. | |
For research and development contracts, we recognize the revenue using the proportional effort method based upon the relationship of costs incurred to date to the total estimated cost to complete the contract. Cost elements include direct labor, materials, overhead costs and outside contractor costs. The excess of amounts billed on a milestone basis versus the amounts recorded as revenue on a proportional effort basis is classified as deferred revenue. We provide for any loss that we expect to incur in the agreements when the loss is probable. | |
The Company uses contract accounting for certain Power on Demand system sales. Due to the limited number of these systems that have been installed to date, revenue is recognized based on the completed contract method whereby revenue and costs are deferred until the contract is completed. For contracts that contain provisions related to proceeds being paid based upon cost savings generated by the system, revenue is recorded as the costs savings are realized by and billed to the customer. If accumulated costs exceed accumulated billings at the reporting date the asset is presented net as costs of uncompleted contracts in excess of related billings. If there is a net liability it is presented as billings on uncompleted contracts in excess of related costs. We provide for any loss that we expect to incur on a contract at the time the loss is probable. | |
At December 31, 2013, the Company had costs of uncompleted contracts in excess of related billings totaling $119,758. This amount was netted with the accrued loss contract on the Company’s balance sheet. | |
Research and Development Costs | ' |
Research and Development Costs | |
All costs related to research and development are expensed when incurred. Research and development costs consist of expenses associated with the development of the Company’s Power on Demand system and micro-grids. Specifically, these costs consist of labor, materials and consultants. | |
Warranty Costs | ' |
Warranty Costs | |
The Company’s standard warranty on each turbine sold protects against defects in design, material and workmanship under normal use for up to a six-year period, however there are several warranties which have different terms and conditions. Warranties on solar PV systems and Power on Demand systems are offered based upon the manufacturer’s product warranty, therefore, no reserve is required for these systems. The Company provides for estimated cost of warranties at the time the revenue is recognized. Factors that affect the warranty reserve are projected cost of repair and/or replacement, component life cycles, and limited historical data. As a result of lower than expected wind turbine performance, many customers have elected to replace their wind turbine with a similarly sized solar PV array. We have taken this into consideration when evaluating the warranty reserves, and have included the cost of replacement as part of the warranty expense. The impact of any change in estimates will be taken into account when analyzing future warranty reserve requirements. | |
Stock-Based Compensation | ' |
Stock-Based Compensation | |
The Company accounts for stock option awards granted under the Company’s Equity Incentive Plan in accordance with ASC 718. Under ASC 718, compensation expense related to stock-based payments is recorded over the requisite service period based on the grant date fair value of the awards. Compensation previously recorded for unvested stock options that are forfeited is reversed upon forfeiture. The Company uses the Black-Scholes option pricing model for determining the estimated fair value for stock-based awards. The Black-Scholes model requires the use of assumptions which determine the fair value of stock-based awards, including the option’s expected term and the price volatility of the underlying stock. | |
The Company’s accounting policy for equity instruments issued to consultants and vendors in exchange for goods and services follows the provisions of ASC 505-50. Accordingly, the measurement date for the fair value of the equity instruments issued is determined at the earlier of (i) the date at which a commitment for performance by the consultant or vendor is reached or (ii) the date at which the consultant’s or vendor’s performance is complete. In the case of equity instruments issued to consultants, the fair value of the equity instrument is recognized over the term of the consulting agreement, or vesting period, whichever is shorter. | |
Income Taxes | ' |
Income Taxes | |
The Company accounts for income taxes using the asset and liability approach, which requires recognition of deferred tax liabilities and assets for the expected future tax consequences of temporary differences between the carrying amounts and the tax basis of such assets and liabilities. This method utilizes enacted statutory tax rates in effect for the year in which the temporary differences are expected to reverse and gives immediate effect to changes in income tax rates upon enactment. Deferred assets are recognized, net of any valuation allowance, for temporary differences and net operating loss and tax credit carry forwards. Deferred income tax expense represents the change in net deferred assets and liability balances. | |
Concentrations of Customers and Suppliers | ' |
Concentrations of Customers and Suppliers | |
The Company’s largest customer accounted for 29% of 2013 sales (54% of 2012 sales), and this customer’s accounts receivable represented 45% of total accounts receivable as of December 31, 2013 (68% as of December 31, 2012). | |
We purchase a significant portion of our solar PV products from a single supplier, and as such receive certain discounts due to purchase volumes. Purchases from this vendor totaled 33% of our material cost of goods sold for the year ended December 31, 2013. There are numerous alternative suppliers that could supply the materials and components used in our solar PV installations, and we believe that utilizing our current supplier will not have an adverse effect on our business. | |
Basic and Diluted Loss Per Share | ' |
Basic and Diluted Loss Per Share | |
Basic earnings per share reflect the actual weighted average of shares issued and outstanding during the period. Diluted earnings per share are computed including the number of additional shares that would have been outstanding if dilutive potential shares had been issued. In a loss year, the calculation for basic and diluted earnings per share is considered to be the same, as the impact of potentially issued common shares would be anti-dilutive. | |
As of December 31, 2013, there were 1,386,108 stock options and 7,671,267 warrants outstanding that, upon exercise, could dilute future earnings. | |
Reclassifications | ' |
Reclassifications | |
Certain prior year amounts have been reclassified to conform to the current year presentation. |
LongLived_Assets_Tables
Long-Lived Assets (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Long Lived Assets [Abstract] | ' | ||||||||
Summary of Company's long-lived assets | ' | ||||||||
December 31, | December 31, | ||||||||
2013 | 2012 | ||||||||
Property and equipment | |||||||||
Equipment | $ | 264,495 | $ | 253,718 | |||||
Furniture and fixtures | 38,950 | 38,950 | |||||||
Software | 71,625 | 71,625 | |||||||
Total property and equipment before accumulated depreciation | 375,070 | 364,293 | |||||||
Less accumulated depreciation | (305,515 | ) | (242,706 | ) | |||||
Total property and equipment | $ | 69,555 | $ | 121,587 | |||||
Intangible assets | |||||||||
Patents | $ | 34,862 | $ | 34,862 | |||||
Trademark | 0 | 4,525 | |||||||
Total intangible assets before accumulated amortization | 34,862 | 39,387 | |||||||
Less accumulated amortization | (9,557 | ) | (8,674 | ) | |||||
Total intangible assets | $ | 25,305 | $ | 30,713 |
Debt_Tables
Debt (Tables) | 12 Months Ended | ||||
Dec. 31, 2013 | |||||
Debt [Abstract] | ' | ||||
Summary of annual maturities of debt | ' | ||||
2014 | $ | 1,030,282 | |||
2015 | $ | 9,540 | |||
2016 | $ | 6,629 |
StockBased_Compensation_Tables
Stock-Based Compensation (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ||||||||||||||||
Summary of the status of the Company's restricted share awards | ' | ||||||||||||||||
Number of | Weighted | ||||||||||||||||
Restricted Shares | Restricted | Average | |||||||||||||||
Shares | Fair Value at | ||||||||||||||||
Grant Date | |||||||||||||||||
Non-vested at December 31, 2012 | 169,368 | $ | 2.8 | ||||||||||||||
Vested – 2013 | 50,989 | $ | 2.8 | ||||||||||||||
Non-vested at December 31, 2013 | 118,379 | $ | 2.8 | ||||||||||||||
Employee Stock Option [Member] | ' | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ||||||||||||||||
Weighted-average assumptions used to fair value calculation for options granted | ' | ||||||||||||||||
Year ended | |||||||||||||||||
December 31, | December 31, | ||||||||||||||||
2013 | 2012 | ||||||||||||||||
Expected dividend yield | 0 | % | 0 | % | |||||||||||||
Expected stock price volatility | 105-108 | % | 109-112 | % | |||||||||||||
Risk-free interest rate | 2.68-3.58 | % | 2.32-2.70 | % | |||||||||||||
Expected life of options | .03-9.71 Years | 1.5-9.5 Years | |||||||||||||||
Summary of the status of Company's aggregate stock options granted | ' | ||||||||||||||||
Number of | Weighted | Weighted-Average Remaining | Aggregate | ||||||||||||||
Shares | Average | Contractual | Intrinsic | ||||||||||||||
Remaining | Exercise | Term | Value | ||||||||||||||
Options | Price | ||||||||||||||||
Outstanding at January 1, 2013 | 516,400 | $ | 3.25 | ||||||||||||||
Options granted during 2013 | 1,735,208 | $ | 0.45 | ||||||||||||||
Options expired/cancelled during 2013 | 865,500 | $ | 0.41 | ||||||||||||||
Outstanding at December 31, 2013 | 1,386,108 | $ | 0.61 | 7.1 | $ | 0 | |||||||||||
Exercisable at December 31, 2013 | 612,308 | $ | 0.87 | 5.3 | $ | 0 |
Warrants_Tables
Warrants (Tables) (Warrant [Member]) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Warrant [Member] | ' | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ||||||||||||||||
Weighted-average assumptions were utilized in the fair value calculations for warrants granted | ' | ||||||||||||||||
Year ended | Year ended | ||||||||||||||||
December 31, | December 31, | ||||||||||||||||
2013 | 2012 | ||||||||||||||||
Expected dividend yield | 0 | % | 0 | % | |||||||||||||
Expected stock price volatility | 93-108 | % | 105-113 | % | |||||||||||||
Risk-free interest rate | .14-2.60 | % | 2.06-3.03 | % | |||||||||||||
Expected life of warrants | .1-9.1 Years | 7.3-9.8 Years | |||||||||||||||
Summary of the status of Company's warrants granted | ' | ||||||||||||||||
Number of | Weighted | Weighted-Average Remaining | Aggregate | ||||||||||||||
Shares | Average | Contractual Term | Intrinsic | ||||||||||||||
Remaining | Exercise | Value | |||||||||||||||
Warrants | Price | ||||||||||||||||
Outstanding at January 1, 2013 | 2,954,250 | $ | 3.8 | 8.5 | |||||||||||||
Warrants granted during 2013 | 4,717,017 | 0.43 | 4.38 | ||||||||||||||
Warrants expired/cancelled during 2013 | 0 | ||||||||||||||||
Outstanding at December 31, 2013 | 7,671,267 | $ | 1.51 | 5.58 | $ | 150,000 | |||||||||||
Exercisable at December 31, 2013 | 6,861,250 | $ | 1.53 | 6.6 | $ | 150,000 | |||||||||||
Derivative_Liabilities_Tables
Derivative Liabilities (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||
Summary of weighted-average assumptions of fair value calculations for warrants granted and subsequent revaluation | ' | ||||||||||||||||
Year Ended | |||||||||||||||||
December 31, | |||||||||||||||||
2013 | |||||||||||||||||
Expected dividend yield | 0 | % | |||||||||||||||
Expected stock price volatility | 70-172 | % | |||||||||||||||
Risk-free interest rate | .08–1.75 | % | |||||||||||||||
Expected life of warrants | .1-4.59 years | ||||||||||||||||
Number of warrants | 4,300,351 | ||||||||||||||||
Fair value of warrants | $ | 775,596 | |||||||||||||||
Summary of derivative liabilities fair value measured on a recurring basis | ' | ||||||||||||||||
Fair Value Measurements at December 31, 2013 | |||||||||||||||||
Total | Quoted | Significant | Significant | ||||||||||||||
Carrying | prices in | other | unobservable | ||||||||||||||
Value at | active | observable | inputs | ||||||||||||||
September 30, | markets | inputs | (Level 3) | ||||||||||||||
2013 | (Level 1) | (Level 2) | |||||||||||||||
Derivative liabilities | $ | 775,596 | $ | - | $ | - | $ | 775,596 | |||||||||
Summary of changes in fair value of Level 3 financial liabilities | ' | ||||||||||||||||
Year ended | |||||||||||||||||
December 31, | |||||||||||||||||
2013 | |||||||||||||||||
Beginning balance January 1, 2013 | $ | 0 | |||||||||||||||
Initial valuation of derivative financial instruments | 1,451,644 | ||||||||||||||||
Net unrealized (gain) loss on derivative financial instruments | -676,048 | ||||||||||||||||
Ending balance | $ | 775,596 |
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Commitments and Contingencies [Abstract] | ' | ||||||||
Annual commitments by year under the Company's lease agreements | ' | ||||||||
Cash rental | |||||||||
commitment | |||||||||
2014 | $ | 70,512 | |||||||
2015 | $ | 72,627 | |||||||
2016 | $ | 74,806 | |||||||
2017 | $ | 77,050 | |||||||
2018 | $ | 72,567 | |||||||
Summary of the activity in the accrued warranty account | ' | ||||||||
December 31, | December 31, | ||||||||
2013 | 2012 | ||||||||
Balance as of beginning of year | $ | 140,074 | $ | 135,606 | |||||
Warranty costs accrued | 0 | 32,816 | |||||||
Settlements made | 0 | (28,348 | ) | ||||||
Balance as of end of year | $ | 140,074 | 140,074 |
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Income Taxes [Abstract] | ' | ||||||||
Summary of components of income tax provision (benefit) | ' | ||||||||
Year ended | |||||||||
2013 | 2012 | ||||||||
Current | $ | (103,471 | ) | $ | (158,895 | ) | |||
Deferred | (1,195,703 | ) | (1,386,246 | ) | |||||
Less increase in allowance | 1,195,703 | 1,386,246 | |||||||
Net deferred | – | – | |||||||
Total income tax provisions (benefit) | $ | -103,471 | $ | (158,895 | ) | ||||
Individual components of deferred tax asset | ' | ||||||||
Year ended | |||||||||
2013 | 2012 | ||||||||
Net operating loss carryforwards | $ | 5,067,659 | $ | 4,107,084 | |||||
Stock based compensation | 4,084,116 | 3,848,988 | |||||||
Depreciation and amortization | 289,345 | 289,345 | |||||||
Tax credit carryforward | 107,854 | 107,854 | |||||||
Total | 9,548,974 | 8,353,271 | |||||||
Less valuation allowance | (9,548,974 | ) | (8,353,271 | ) | |||||
Net deferred tax assets | $ | – | $ | – | |||||
Differences between United States statutory federal income tax rate and effective income tax rate | ' | ||||||||
Year ended | |||||||||
2013 | 2012 | ||||||||
Tax benefit at statutory United States federal rate | $ | (1,112,800 | ) | $ | (1,186,565 | ) | |||
State income tax credit net of federal benefit | (136,634 | ) | (187,427 | ) | |||||
Permanent items | (49,740 | ) | |||||||
Tax credits | 0 | (107,034 | ) | ||||||
Adjustments from prior year | 0 | (64,115 | ) | ||||||
Change in valuation reserves | 1,195,703 | 1,386,246 | |||||||
Current tax (expense) income | 103,471 | (158,895 | |||||||
Effective tax rate (%) | 3 | % | 4 | % | |||||
Description_of_the_Business_an1
Description of the Business and Summary of Significant Accounting Policies (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Description of Business and Summary of Significant Accounting Policies (Textual) | ' | ' |
Allowance for doubtful accounts | $0 | $25,200 |
Inventory, raw materials | 346,014 | 197,928 |
Inventory, work in process | 150,299 | 471,817 |
Impairment of trademark cost | 3,699 | ' |
Cost of uncompleted contracts | 119,758 | ' |
Inventory reserves | 0 | 0 |
Impairment of assets | $168,247 | $33,302 |
Warranty period on each turbine sold | '6 years | ' |
Largest customer sales percentage | 29.00% | 54.00% |
Customer accounts receivable in percentage | 45.00% | 68.00% |
Purchases from vendor in percentage | 33.00% | ' |
Stock Options [Member] | ' | ' |
Description of Business and Summary of Significant Accounting Policies (Textual) | ' | ' |
Outstanding, Number | 1,386,108 | 516,400 |
Warrants [Member] | ' | ' |
Description of Business and Summary of Significant Accounting Policies (Textual) | ' | ' |
Outstanding, Number | 7,671,267 | 2,954,250 |
Going_Concern_Details
Going Concern (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Going Concern (Textual) | ' | ' |
Sales revenue over four years | $5,500,000 | ' |
Cumulative net loss | 27,034,691 | 23,761,751 |
Common stock yielded net proceeds | 1,245,000 | 795,000 |
Common Stock | ' | ' |
Going Concern (Textual) | ' | ' |
Common stock yielded net proceeds | $1,245,000 | $795,000 |
Shares issued | 5,020,000 | 397,500 |
LongLived_Assets_Details
Long-Lived Assets (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Property and equipment | ' | ' |
Equipment | $264,495 | $253,718 |
Furniture and fixtures | 38,950 | 38,950 |
Software | 71,625 | 71,625 |
Total property and equipment before accumulated depreciation | 375,070 | 364,293 |
Less accumulated depreciation | -305,515 | -242,706 |
Total property and equipment | 69,555 | 121,587 |
Intangible assets | ' | ' |
Patents | 34,862 | 34,862 |
Trademark | 0 | 4,525 |
Total intangible assets before accumulated amortization | 34,862 | 39,387 |
Less accumulated amortization | -9,557 | -8,674 |
Total intangible assets | $25,305 | $30,713 |
LongLived_Assets_Details_Textu
Long-Lived Assets (Details Textual) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Long Lived Assets (Textual) | ' | ' |
Impairment of assets | $0 | $33,302 |
Impairment of trademark cost | $3,699 | ' |
Debt_Details
Debt (Details) (USD $) | Dec. 31, 2013 |
Summary of annual maturities of debt | ' |
2014 | $1,030,282 |
2015 | 9,540 |
2016 | $6,629 |
Debt_Details_Textual
Debt (Details Textual) (USD $) | 0 Months Ended | 1 Months Ended | 12 Months Ended | |||||
29-May-13 | Dec. 21, 2012 | Sep. 04, 2012 | Oct. 31, 2011 | Aug. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Nov. 13, 2012 | |
Debt (Textual) | ' | ' | ' | ' | ' | ' | ' | ' |
Line of credit interest rate | ' | ' | 10.00% | ' | ' | ' | ' | ' |
Loan from Canandaigua National Bank | ' | ' | ' | ' | $44,748 | ' | ' | ' |
Term of loan | ' | ' | ' | '36 months | '60 months | ' | ' | ' |
Annual interest rate | ' | ' | ' | 6.76% | 4.99% | ' | ' | ' |
Monthly payments of loan | ' | ' | ' | 279 | 844 | ' | ' | ' |
Lease of office equipment | ' | ' | ' | 9,068 | ' | ' | ' | ' |
Line of credit, amount payable | ' | ' | ' | ' | ' | 1,018,500 | 748,500 | ' |
Working capital revolving line of credit | ' | 750,000 | 500,000 | ' | ' | ' | ' | 500,000 |
Maximum borrowing, line of credit | ' | 1,250,000 | ' | ' | ' | ' | ' | 750,000 |
Line of credit maturity date | 21-Dec-14 | 21-Dec-13 | ' | ' | ' | ' | ' | ' |
Warrants issued to purchase common stock | ' | ' | ' | ' | ' | ' | 1,250,000 | ' |
Warrants purchase common stock varying prices minimum (Per share) | ' | ' | ' | ' | ' | ' | $1.38 | ' |
Warrants purchase common stock varying prices maximum (Per share) | ' | ' | ' | ' | ' | ' | $1.62 | ' |
Term of warrants | ' | ' | ' | ' | ' | ' | '10 years | ' |
Warrants vesting period | ' | ' | ' | ' | ' | ' | '1 year | ' |
Issuance of warrants with revolving line of credit facility | ' | ' | ' | ' | ' | ' | 1,839,250 | ' |
Deferred debt discount | ' | ' | ' | ' | ' | 820,750 | 1,090,750 | ' |
Amortization of debt discount | ' | ' | ' | ' | ' | $518,481 | $166,513 | ' |
Stockholders_Equity_Details
Stockholders' Equity (Details) (USD $) | 12 Months Ended | 0 Months Ended | 0 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | ||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2010 | Aug. 20, 2013 | Apr. 01, 2011 | Dec. 31, 2013 | Aug. 08, 2013 | Jul. 31, 2013 | Jul. 31, 2013 | Dec. 31, 2013 | 31-May-13 | Dec. 31, 2013 | Jul. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | |
Director [Member] | Director [Member] | Director [Member] | Securities Purchase Agreement [Member] | Securities Purchase Agreement [Member] | 1999 Mt. RB, LLC [Member] | 1999 Mt. RB, LLC [Member] | Sunrise Financial Group, Inc. [Member] | 2008 Equity Incentive Plan [Member] | Warrants [Member] | Private placement [Member] | Private placement [Member] | ||||
Consultant [Member] | Unit | Warrants [Member] | |||||||||||||
Stockholders' Equity (Textual) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock consisted in each unit up for sale | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 7,500 | 1,000 |
Stock option granted | 1,735,208 | 178,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 520,208 | ' | ' | ' |
Price per share, warrants | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $10 |
Vesting period of stock options | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '2 years |
Expected life of warrants (Years) | ' | ' | ' | ' | ' | ' | '5 years | '5 years | ' | ' | ' | ' | ' | ' | '10 years |
Number of common stock units sold | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 53 | ' |
Yield generated from units sold | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $795,000 | ' |
Common stock issued under lease modification | ' | ' | ' | ' | ' | ' | ' | ' | ' | 390,394 | ' | ' | ' | ' | ' |
Warrants issued to purchase common stock under purchase agreement | ' | ' | ' | ' | ' | ' | 300,000 | 2,210,000 | ' | 600,000 | 620,341 | ' | 550,000 | ' | ' |
Warrants issued to purchase common stock, share price | ' | ' | ' | ' | ' | ' | ' | ' | ' | $1 | $0.73 | ' | ' | ' | ' |
Warrant expiration date | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4-Feb-14 | ' | ' | ' | ' | ' |
Fair value of warrants issued on grant date | ' | ' | ' | ' | ' | ' | 895,800 | ' | ' | 256,800 | 299,044 | ' | ' | ' | ' |
Warrants non cash expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | 40,415 | 183,521 | ' | ' | ' | ' |
Prepaid asset | ' | ' | ' | ' | ' | ' | ' | ' | ' | 44,023 | 115,523 | ' | ' | ' | ' |
Other assets | 172,362 | 0 | ' | ' | ' | ' | ' | ' | ' | 172,362 | ' | ' | ' | ' | ' |
Adjusted purchase price of warrants | ' | ' | ' | ' | ' | ' | ' | ' | $0.25 | $0.25 | ' | ' | ' | ' | ' |
Sale of stock under private placement | ' | ' | ' | ' | ' | ' | ' | $0.25 | ' | ' | ' | ' | ' | ' | ' |
Number of common stock sold | ' | ' | ' | ' | ' | ' | 600,000 | 4,420,000 | ' | ' | ' | ' | ' | ' | ' |
Warrant price of additional shares of common stock | ' | ' | ' | ' | ' | ' | $0.30 | $0.30 | ' | ' | ' | ' | ' | ' | ' |
Proceeds From Gross Sales | ' | ' | ' | ' | ' | ' | 150,000 | 1,105,000 | ' | ' | ' | ' | ' | ' | ' |
Legal costs associated with private placement | ' | ' | ' | ' | ' | ' | 10,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Issuance of common stock for rent and services | 258,391 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock value issued for professional services | 258,391 | 289,015 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock option expense | 695,250 | 578,887 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Period of salary forfeited | ' | ' | '84 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of Restricted Shares, Vested | ' | ' | ' | 50,989 | 55,969 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of Restricted Shares, Non-vested | ' | ' | ' | ' | ' | 118,379 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total increase in equity under private placement | ' | ' | ' | ' | ' | ' | $349,200 | ' | ' | ' | ' | ' | ' | ' | ' |
Exercise price of Warrants | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.3 | ' | ' |
Warrants Expiry Term | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | ' | ' |
StockBased_Compensation_Detail
Stock-Based Compensation (Details) (Stock Options [Member]) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Stock Options [Member] | ' | ' |
Weighted-average assumptions | ' | ' |
Expected dividend yield | 0.00% | 0.00% |
Expected stock price volatility, minimum | 105.00% | 109.00% |
Expected stock price volatility, maximum | 108.00% | 112.00% |
Risk-free interest rate, minimum | 2.68% | 2.32% |
Risk-free interest rate. maximum | 3.58% | 2.70% |
Expected life of options, minimum (Years) | '11 days | '1 year 6 months |
Expected life of options, maximum (Years) | '9 years 8 months 16 days | '9 years 6 months |
StockBased_Compensation_Detail1
Stock-Based Compensation (Details 1) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Summary of the status of the Company's aggregate stock options granted | ' | ' |
Options expired/cancelled, Number of Shares | 865,500 | 26,000 |
Stock Options [Member] | ' | ' |
Summary of the status of the Company's aggregate stock options granted | ' | ' |
Number of Shares, Outstanding, Beginning balance | 516,400 | ' |
Options granted, Number of Shares Remaining Options | 1,735,208 | ' |
Options expired/cancelled, Number of Shares | 865,500 | ' |
Number of Shares, Outstanding, Ending Balance | 1,386,108 | ' |
Number of Shares Remaining Options, Exercisable | 612,308 | ' |
Weighted Average Exercise Price, Outstanding, Beginning balance | 3.25 | ' |
Options granted, Weighted Average Exercise Price | 0.45 | ' |
Options expired/cancelled, Weighted Average Exercise Price | 0.41 | ' |
Weighted Average Exercise Price, Outstanding, Ending balance | 0.61 | ' |
Exercisable, Weighted Average Exercise Price | 0.87 | ' |
Weighted-Average Remaining Contractual Term, Outstanding | '7 years 1 month 6 days | ' |
Exercisable, Weighted Average Remaining Contractual Term | '5 years 3 months 18 days | ' |
Outstanding, Intrinsic Value | 0 | ' |
Exercisable, Intrinsic Value | 0 | ' |
StockBased_Compensation_Detail2
Stock-Based Compensation (Details 2) (Restricted Stock [Member], USD $) | 12 Months Ended |
Dec. 31, 2013 | |
Restricted Stock [Member] | ' |
Summary of the status of the Company's restricted share awards | ' |
Number of Restricted Shares, Non-vested | 169,368 |
Number of Restricted Shares, Vested | 50,989 |
Number of Restricted Shares, Non-vested | 118,379 |
Weighted Average Fair Value at Grant Date, Non-vested | $2.80 |
Weighted Average Fair Value at Grant Date, Vested | $2.80 |
Weighted Average Fair Value at Grant Date, Non-vested | $2.80 |
StockBased_Compensation_Detail3
Stock-Based Compensation (Details Textual) (USD $) | 1 Months Ended | 3 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | ||||||||||||||
Jul. 31, 2013 | Jan. 22, 2013 | Mar. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Aug. 20, 2013 | Nov. 08, 2012 | Apr. 01, 2011 | Dec. 31, 2013 | Jan. 22, 2013 | Nov. 08, 2012 | Nov. 08, 2012 | Mar. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | |
Board of Directors [Member] | Board of Directors [Member] | Board of Directors [Member] | Board of Directors [Member] | Board of Directors [Member] | William A. Schmitz [Member] | Molly Hedges [Member] | Maximum [Member] | Minimum [Member] | 2008 Equity Incentive Plan [Member] | 2008 Equity Incentive Plan [Member] | 2008 Equity Incentive Plan [Member] | December 13, 2010 restricted stock award [Member] | December 13, 2010 restricted stock award [Member] | Stock Option [Member] | Stock Option [Member] | ||||||
Board of Directors [Member] | Board of Directors [Member] | Annual Meeting on April 28,2010 [Member] | Annual Meeting on May 9,2012 [Member] | ||||||||||||||||||
Stock Based Compensation (Textual) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Repricing of number of outstanding compensatory options approved by board of directors | ' | ' | ' | ' | ' | ' | 85,000 | ' | ' | 25,000 | 75,000 | 10,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options granted, Weighted Average Exercise Price | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.45 | $2.05 |
Options expired/cancelled, Number of Shares | ' | ' | ' | 865,500 | 26,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 865,500 | 26,000 |
Stock option granted | ' | ' | ' | 1,735,208 | 178,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 520,208 | ' | ' | ' | ' | 1,735,208 | 178,000 |
Option granted under equity incentive plan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,655,000 | ' |
Increase in shares available under equity incentive plan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,550,000 | 2,000,000 | 2,000,000 | 800,000 | 1,550,000 | ' | ' | ' | ' |
Number of shares are available for grant as Incentive Stock Options | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50,000 | ' | ' | ' | ' | ' | ' |
Exercise price for options award | ' | ' | ' | 'No less than 100% of the fair market value of the common stock on the day of grant. | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based compensation vesting period | ' | ' | ' | 'Either immediately on the date of grant or 1 to 3 years from the date of grant. | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Compensation costs for options and restricted shares granted | ' | ' | ' | $584,671 | $543,267 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of Restricted Shares, Vested | ' | ' | ' | ' | ' | 50,989 | ' | 55,969 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50,989 | ' | ' | ' |
Number of Restricted Shares, Non-vested | ' | ' | ' | ' | ' | ' | ' | ' | 118,379 | ' | ' | ' | ' | ' | ' | ' | ' | 118,379 | 169,368 | ' | ' |
Expenses occurred in repricing of options | $34,381 | ' | $13,575 | $110,579 | $38,673 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options exercise price | $0.75 | $1.20 | ' | $1.20 | $3.25 | ' | $1.67 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Warrants_Details
Warrants (Details) (Warrant [Member]) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Warrant [Member] | ' | ' |
Weighted-average assumptions were utilized in the fair value calculations for warrants granted | ' | ' |
Expected dividend yield | 0.00% | 0.00% |
Expected stock price volatility, minimum | 93.00% | 105.00% |
Expected stock price volatility, maximum | 108.00% | 113.00% |
Risk-free interest rate, minimum | 0.14% | 2.06% |
Risk-free interest rate, maximum | 2.60% | 3.03% |
Expected life of warrants, minimum | '1 month 6 days | '7 years 3 months 18 days |
Expected life of warrants, maximum | '9 years 1 month 6 days | '9 years 9 months 18 days |
Warrants_Details_1
Warrants (Details 1) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Summary of status of Company's warrant granted | ' | ' |
Number of Shares Remaining Warrants, Warrants expired/cancelled | 865,500 | 26,000 |
Warrants [Member] | ' | ' |
Summary of status of Company's warrant granted | ' | ' |
Number of Shares, Outstanding, Beginning balance | 2,954,250 | ' |
Warrants granted | 4,717,017 | ' |
Number of Shares Remaining Warrants, Warrants expired/cancelled | 0 | ' |
Number of Shares, Outstanding, Ending Balance | 7,671,267 | ' |
Number of Shares Remaining Options, Exercisable | 6,861,250 | ' |
Weighted Average Exercise Price, Outstanding, Beginning balance | 3.8 | ' |
Warrant granted, Weighted Average Exercise Price | 0.43 | ' |
Weighted Average Exercise Price, Outstanding, Ending balance | 1.51 | ' |
Exercisable, Weighted Average Exercise Price | 1.53 | ' |
Weighted-Average Remaining Contractual Term, Outstanding | '8 years 6 months | ' |
Warrants granted, Weighted-Average Remaining Contractual Term | '4 years 4 months 17 days | ' |
Weighted-Average Remaining Contractual Term, Outstanding, Ending balance | '5 years 6 months 29 days | ' |
Exercisable, Weighted Average Remaining Contractual Term | '6 years 7 months 6 days | ' |
Outstanding, Intrinsic Value | 150,000 | ' |
Exercisable, Intrinsic Value | 150,000 | ' |
Warrants_Details_Textual
Warrants (Details Textual) (USD $) | 12 Months Ended | 1 Months Ended | 0 Months Ended | |||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Jan. 22, 2013 | Nov. 08, 2012 | Nov. 08, 2012 | Nov. 08, 2012 | |
Warrants [Member] | Warrants [Member] | Warrants [Member] | Warrants [Member] | Warrants [Member] | Warrants [Member] | Warrants [Member] | Warrants [Member] | |||
Six month anniversary of grant [Member] | Two year anniversary of grant [Member] | Board of Directors [Member] | Board of Directors [Member] | William A Schmitz [Member] | Molly Hedges [Member] | |||||
Warrants (Textual) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted average fair value of warrants | ' | ' | $0.43 | $1.94 | ' | ' | ' | ' | ' | ' |
Warrants vested | ' | ' | 5,369,250 | 404,500 | ' | ' | ' | ' | ' | ' |
Options expired/cancelled, Number of Shares | 865,500 | 26,000 | 0 | ' | ' | ' | ' | ' | ' | ' |
Outstanding warrants repriced | ' | ' | ' | ' | ' | ' | 423,125 | 172,500 | 115,000 | 57,500 |
Warrants exercise price | ' | ' | $1.20 | ' | $1.20 | $1.20 | $1.20 | $1.67 | ' | ' |
Compensation costs | ' | ' | $368,927 | ' | ' | ' | ' | ' | ' | ' |
Warrants issued to consultant | ' | ' | 416,666 | ' | 250,000 | 166,666 | ' | ' | ' | ' |
Expenses associated with the repricing | ' | ' | ' | ' | ' | ' | $76,198 | $24,323 | ' | ' |
Derivative_Liabilities_Details
Derivative Liabilities (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 |
Warrant [Member] | Warrant [Member] | Warrant [Member] | |||
Maximum [Member] | Minimum [Member] | ||||
Summary of weighted-average assumptions of fair value calculations for warrants granted and subsequent revaluation (Textual) | ' | ' | ' | ' | ' |
Expected dividend yield | ' | ' | 0.00% | ' | ' |
Expected stock price volatility | ' | ' | ' | 172.00% | 70.00% |
Risk-free interest rate | ' | ' | ' | 1.75% | 0.08% |
Expected life of warrants | ' | ' | ' | '4 years 7 months 2 days | '1 month 6 days |
Number of warrants | ' | ' | 4,300,351 | ' | ' |
Fair value of warrants | $775,596 | $0 | $775,596 | ' | ' |
Derivative_Liabilities_Details1
Derivative Liabilities (Details 1) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Summary of derivative liabilities fair value measured on a recurring basis (Textual) | ' | ' |
Derivative liabilities | $775,596 | $0 |
Quoted prices in active markets (Level 1) | ' | ' |
Summary of derivative liabilities fair value measured on a recurring basis (Textual) | ' | ' |
Derivative liabilities | ' | ' |
Significant other observable inputs (Level 2) | ' | ' |
Summary of derivative liabilities fair value measured on a recurring basis (Textual) | ' | ' |
Derivative liabilities | ' | ' |
Significant unobservable inputs (Level 3) | ' | ' |
Summary of derivative liabilities fair value measured on a recurring basis (Textual) | ' | ' |
Derivative liabilities | $775,596 | ' |
Derivative_Liabilities_Details2
Derivative Liabilities (Details 2) (USD $) | 12 Months Ended |
Dec. 31, 2013 | |
Summary of changes in fair value of Level 3 financial liabilities | ' |
Beginning balance | $0 |
Initial valuation of derivative financial instruments | 1,451,644 |
Net unrealized (gain) loss on derivative financial instruments | -676,048 |
Ending balance | $775,596 |
Derivative_Liabilities_Details3
Derivative Liabilities (Details Textual) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Derivative Liabilities (Textual) | ' | ' |
Unrealized gain on change in fair value of derivative liabilities | ($676,048) | $0 |
Derivative Liability, Long term liability | 762,396 | 0 |
Fair value of warrants | 13,200 | 0 |
Derivative liabilities | $775,596 | $0 |
Commitments_and_Contingencies_1
Commitments and Contingencies (Details) (USD $) | Dec. 31, 2013 |
Annual commitments by year under the Company's lease agreements | ' |
2014 | $70,512 |
2015 | 72,627 |
2016 | 74,806 |
2017 | 77,050 |
2018 | $72,567 |
Commitments_and_Contingencies_2
Commitments and Contingencies (Details 1) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2010 | |
Summary of activity in accrued warranty account | ' | ' | ' |
Balance as of beginning of year | $140,074 | $135,606 | $50,690 |
Warranty costs accrued | 0 | 32,816 | ' |
Settlements made | 0 | -28,348 | ' |
Balance as of end of year | $140,074 | $140,074 | $50,690 |
Commitments_and_Contingencies_3
Commitments and Contingencies (Details Textual) (USD $) | 1 Months Ended | 1 Months Ended | 12 Months Ended | ||
Oct. 31, 2010 | Dec. 31, 2013 | Dec. 31, 2012 | Jul. 31, 2013 | Dec. 31, 2013 | |
1999 Mt. RB, LLC [Member] | 1999 Mt. RB, LLC [Member] | ||||
Squarefoot | |||||
Commitments and Contingencies (Textual) | ' | ' | ' | ' | ' |
Agreements expiring period | 'The lease term is from August 2010 through July 2015. | ' | ' | ' | 'A lease term that runs from February 1, 2013 through November 30, 2018. |
Monthly base rental payment | $5,396 | ' | ' | ' | ' |
Percentage increase in base rent | 3.00% | ' | ' | ' | 3.00% |
Advance payments received for sale order | ' | 19,000 | 127,239 | ' | ' |
Warranty reserve | ' | $140,074 | $140,074 | ' | ' |
Common stock issued under lease modification | ' | ' | ' | ' | 390,394 |
Warrants issued to purchase common stock under purchase agreement | ' | ' | ' | ' | 600,000 |
Warrants issued to purchase common stock, share price | ' | ' | ' | ' | $1 |
Warrant expiration date | ' | ' | ' | ' | 4-Feb-14 |
Adjusted purchase price of warrants | ' | ' | ' | $0.25 | $0.25 |
Area of lease ( In square feet) | ' | ' | ' | ' | 20,096 |
Renewal options description | ' | ' | ' | ' | 'Two five-year renewal options at the option of Arista Power. |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Summary of components of income tax provision (benefit) | ' | ' |
Current | ($103,471) | ($158,895) |
Deferred | -1,195,703 | -1,386,246 |
Less increase in allowance | 1,195,703 | 1,386,246 |
Net deferred | ' | ' |
Total income tax provisions (benefit) | ($103,471) | ($158,895) |
Income_Taxes_Details_1
Income Taxes (Details 1) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Individual components of deferred tax asset | ' | ' |
Net operating loss carryforwards | $5,067,659 | $4,107,084 |
Stock based compensation | 4,084,116 | 3,848,988 |
Depreciation and amortization | 289,345 | 289,345 |
Tax credit carryforward | 107,854 | 107,854 |
Total | 9,548,974 | 8,353,271 |
Less valuation allowance | -9,548,974 | -8,353,271 |
Net deferred tax assets | ' | ' |
Income_Taxes_Details_2
Income Taxes (Details 2) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Differences between United States statutory federal income tax rate and effective income tax rate | ' | ' |
Tax benefit at statutory United States federal rate | ($1,112,800) | ($1,186,565) |
State income tax credit net of federal benefit | -136,634 | -187,427 |
Permanent items | -49,740 | ' |
Tax credits | 0 | -107,034 |
Adjustments from prior year | 0 | -64,115 |
Change in valuation reserves | 1,195,703 | 1,386,246 |
Current tax (expense) income | ($103,471) | ($158,895) |
Effective tax rate (%) | 3.00% | 4.00% |
Income_Taxes_Details_Textual
Income Taxes (Details Textual) (USD $) | 12 Months Ended | |||
Dec. 31, 2013 | Dec. 31, 2012 | Apr. 30, 2013 | Dec. 31, 2010 | |
Income Taxes (Textual) | ' | ' | ' | ' |
Net operating loss carryforwards | $14,434,000 | ' | ' | ' |
Net operating loss carryforwards, expire date | 31-Dec-33 | ' | ' | ' |
Cash payment for taxes | -103,471 | -158,895 | ' | ' |
Tax credit amount | ' | ' | 103,971 | 159,395 |
Interest and penalties related to tax | $0 | $0 | ' | ' |
Subsequent_Events_Details
Subsequent Events (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Mar. 31, 2014 | Dec. 31, 2013 |
Subsequent Event [Member] | Subsequent Event [Member] | |||
Subsequent Event [Line Items] | ' | ' | ' | ' |
Sale Of Series A Convertible Preferred Stock, Shares | ' | ' | 1,500 | ' |
Stated Value Of Series A Convertible Preferred Stock | ' | ' | $1,500,000 | ' |
Convertible Preferred Stock, Terms of Conversion | ' | ' | ' | ' |
On March 31, 2014, the Company sold, pursuant to a securities purchase agreement, an aggregate of 1,500 shares of Series A Convertible Preferred Stock, with a stated value of $1,500,000 that are convertible into shares of the Company’s common stock at a conversion price of $0.20 in stated value per share (7,500,000 shares of common stock), and five-year warrants, which vested in full upon issuance, to purchase up to 11,250,000 additional shares of common stock at a purchase price of $0.25 per share to eight institutional investors. The Company received a total of $1,400,000 in net proceeds from the sales. Each share of Series A Convertible Preferred Stock is entitled to cash interest payments of 9% of the stated value per year, payable quarterly. The Series A Convertible Preferred Stock is voluntarily and mandatorily convertible into shares of common stock pursuant to the provisions of the securities purchase agreement, with any shares of Series A Convertible Preferred Stock outstanding on March 31, 2017 automatically converting into common stock. The investors received rights of first refusal and rights of participation in future financings of the Company until March 31, 2015. In addition, the investors received most favored nation protections on the terms and conditions of the warrants and preferred stock so long as such securities remain outstanding. Additionally, until September 30, 2015, each investor has the right to invest the amount invested by such investor in the above-referenced transaction in Series A Convertible Preferred Stock of Arista Power on substantially similar terms. The Series A Convertible Preferred Stock and warrants have customary anti-dilution protections and registration rights including a “full ratchet” anti-dilution adjustment provision. | ||||
Proceeds from Issuance or Sale of Equity | ' | ' | $1,400,000 | ' |
Common stock, shares issued | 17,993,694 | 12,406,633 | 7,500,000 | ' |