Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Mar. 16, 2020 | Jun. 30, 2019 | |
Document and Entity Information | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2019 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | Vuzix Corp | ||
Entity Central Index Key | 0001463972 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Accelerated Filer | ||
Entity Public Float | $ 97,000,000 | ||
Trading Symbol | VUZI | ||
Entity Common Stock, Shares Outstanding | 33,128,620 | ||
Entity Emerging Growth Company | false | ||
Entity Small Business | true | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Shell Company | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Current Assets | ||
Cash and Cash Equivalents | $ 10,606,091 | $ 17,263,643 |
Accounts Receivable, Net | 1,371,913 | 772,336 |
Note Receivable | 250,000 | |
Inventories, Net | 5,707,867 | 7,281,802 |
Manufacturing Vendor Prepayments | 242,539 | 755,219 |
Prepaid Expenses and Other Assets | 895,098 | 1,310,095 |
Total Current Assets | 19,073,508 | 27,383,095 |
Long-Term Assets | ||
Fixed Assets, Net | 4,327,676 | 4,291,690 |
Operating Lease Right-of-Use Asset | 2,096,190 | |
Patents and Trademarks, Net | 1,294,675 | 1,164,543 |
Licenses, Net | 314,416 | 437,120 |
Intangible Asset, Net | 990,000 | 1,398,000 |
Other Assets | 350,000 | 459,192 |
Total Assets | 28,446,465 | 35,133,640 |
Current Liabilities | ||
Accounts Payable | 1,062,785 | 2,668,241 |
Customer Deposits | 152,362 | |
Unearned Revenue | 142,463 | 211,726 |
Accrued Expenses | 885,897 | 1,614,078 |
Taxes Payable | 18,687 | 30,258 |
Operating Lease Right-of-Use Liability | 524,825 | |
Total Current Liabilities | 2,634,657 | 4,676,665 |
Long-Term Liabilities | ||
Operating Lease Right-of-Use Liability | 1,571,365 | |
Total Liabilities | 4,206,022 | 4,676,665 |
Stockholders' Equity | ||
Preferred Stock - $.001 Par Value, 5,000,000 Shares Authorized; 49,626 and 49,626 Shares Issued and Outstanding as of December 31, 2019 and December 31, 2018. | 50 | 50 |
Common Stock - $.001 Par Value, 100,000,000 Shared Authorized; 33,128,620 Shares Issued and Outstanding as of December 31, 2019 and 27,591,670 as of December 31, 2018. | 33,128 | 27,591 |
Additional Paid-in Capital | 168,950,076 | 148,695,775 |
Accumulated Deficit | (144,742,811) | (118,266,441) |
Total Stockholders' Equity | 24,240,443 | 30,456,975 |
Total Liabilities and Stockholders' Equity | $ 28,446,465 | $ 35,133,640 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2019 | Dec. 31, 2018 |
CONSOLIDATED BALANCE SHEETS | ||
Preferred Stock, Par Value | $ 0.001 | $ 0.001 |
Preferred Stock, Shares Authorized | 5,000,000 | 5,000,000 |
Preferred Stock, Shares Issued | 49,626 | 49,626 |
Preferred Stock, Shares Outstanding | 49,626 | 49,626 |
Common Stock, Par Value | $ 0.001 | $ 0.001 |
Common Stock, Shares Authorized | 100,000,000 | 100,000,000 |
Common Stock, Shares Issued | 33,128,620 | 27,591,670 |
Common Stock, Shares Outstanding | 33,128,620 | 27,591,670 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) | Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Total |
Balance at Dec. 31, 2016 | $ 50 | $ 19,569 | $ 94,541,168 | $ (76,838,950) | $ 17,721,837 |
Balance (in shares) at Dec. 31, 2016 | 49,626 | 19,569,247 | |||
Stock-Based Compensation | $ 0 | $ 17 | 1,355,505 | 0 | 1,355,522 |
Stock-Based Compensation (in shares) | 16,668 | ||||
Conversion of Notes Payable and Accrued Interest | 0 | $ 827 | 1,860,456 | 0 | 1,861,283 |
Conversion of Notes Payable and Accrued Interest (in shares) | 827,237 | ||||
Common Stock Awards to Directors | 0 | $ 50 | 334,950 | 0 | 335,000 |
Common Stock Awards to Directors (in shares) | 50,000 | ||||
Exercise of Warrants | $ 0 | $ 168 | (168) | 0 | 0 |
Exercise of Warrants (in shares) | 0 | 168,203 | |||
Proceeds from Common Stock Offerings | $ 0 | $ 3,566 | 21,124,936 | 0 | 21,128,502 |
Proceeds from Common Stock Offerings (in shares) | 3,566,116 | ||||
Direct Costs of Common Stock Offerings | 0 | $ 0 | (1,617,679) | 0 | (1,617,679) |
Exercise of Stock Options | 0 | $ 37 | (37) | 0 | 0 |
Exercise of Stock Options (in shares) | 37,261 | ||||
Common Stock Issued for Services | 0 | $ 42 | 228,708 | 0 | 228,750 |
Common Stock Issued for Services (in shares) | 41,543 | ||||
Net Loss | 0 | $ 0 | 0 | (19,633,502) | (19,633,502) |
Balance at Dec. 31, 2017 | $ 50 | $ 24,276 | 117,827,839 | (96,472,452) | 21,379,713 |
Balance (in shares) at Dec. 31, 2017 | 49,626 | 24,276,275 | |||
Stock-Based Compensation | $ 0 | $ 28 | 1,620,450 | 0 | 1,620,478 |
Stock-Based Compensation (in shares) | 27,915 | ||||
Cumulative Revenue Adjustment - ASC 606 Adoption | 81,724 | 81,724 | |||
Exercise of Warrants | $ 0 | $ 84 | 39,289 | 0 | 39,373 |
Exercise of Warrants (in shares) | 0 | 84,210 | |||
Settlement of Derivative Liability upon Exercise of Warrants | 166,800 | 166,800 | |||
Proceeds from Common Stock Offerings | $ 0 | $ 3,000 | 29,997,000 | 0 | 30,000,000 |
Proceeds from Common Stock Offerings (in shares) | 3,000,000 | ||||
Direct Costs of Common Stock Offerings | 0 | (1,975,000) | 0 | (1,975,000) | |
Exercise of Stock Options | 0 | $ 41 | (41) | 0 | |
Exercise of Stock Options (in shares) | 41,111 | ||||
Common Stock Issued for Services | 0 | $ 17 | 99,983 | 0 | 100,000 |
Common Stock Issued for Services (in shares) | 17,159 | ||||
Common Stock Awards | 0 | $ 145 | 919,455 | 0 | 0 |
Common Stock Awards (in shares) | 145,000 | ||||
Net Loss | 0 | $ 0 | 0 | (21,875,713) | (21,875,713) |
Balance at Dec. 31, 2018 | $ 50 | $ 27,591 | 148,695,775 | (118,266,441) | 30,456,975 |
Balance (in shares) at Dec. 31, 2018 | 49,626 | 27,591,670 | |||
Stock-Based Compensation | $ 0 | $ 58 | 1,404,773 | 0 | 1,404,831 |
Stock-Based Compensation (in shares) | 0 | 57,496 | |||
Proceeds from Common Stock Offerings | $ 0 | $ 5,479 | 19,994,528 | 0 | 20,000,007 |
Proceeds from Common Stock Offerings (in shares) | 0 | 5,479,454 | |||
Direct Costs of Common Stock Offerings | $ 0 | $ 0 | (1,145,000) | 0 | (1,145,000) |
Net Loss | 0 | 0 | 0 | (26,476,370) | (26,476,370) |
Balance at Dec. 31, 2019 | $ 50 | $ 33,128 | $ 168,950,076 | $ (144,742,811) | $ 24,240,443 |
Balance (in shares) at Dec. 31, 2019 | 49,626 | 33,128,620 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Sales: | |||
Total Sales | $ 6,670,604 | $ 8,094,368 | $ 5,537,753 |
Cost of Sales: | |||
Total Cost of Sales | 11,078,725 | 6,326,086 | 6,214,351 |
Gross Profit (Loss) (exclusive of depreciation shown separately below) | (4,408,121) | 1,768,282 | (676,598) |
Operating Expenses: | |||
Research and Development | 8,900,837 | 10,378,728 | 6,706,690 |
Selling and Marketing | 4,215,611 | 4,822,639 | 3,694,913 |
General and Administrative | 6,600,092 | 6,973,238 | 6,126,335 |
Depreciation and Amortization | 2,441,581 | 1,469,664 | 998,528 |
Impairment of Software Development Cost | 196,223 | 0 | |
Loss (Gain) on Inventory Revaluation and Product Discontinuance | (211,416) | 1,151,482 | |
Total Operating Expenses | 22,158,121 | 23,629,076 | 18,677,948 |
Loss from Operations | (26,566,242) | (21,860,794) | (19,354,546) |
Other Income (Expense): | |||
Investment Income | 252,416 | 191,755 | 58,530 |
Other Taxes | (110,269) | (57,917) | (28,363) |
Foreign Exchange Loss | (52,275) | (60,380) | (65,248) |
Loss on Asset Disposal | (55,172) | (585) | |
Gain (Loss) on Derivative Valuation | (13,873) | 20,204 | |
Amortization of Term Debt Discounts and Deferred Issuance Costs | 0 | (175,260) | |
Interest Expense | (19,332) | (88,234) | |
Total Other Income (Expense), Net | 89,872 | (14,919) | (278,956) |
Loss Before Provision for Income Taxes | (26,476,370) | (21,875,713) | (19,633,502) |
Provision for Income Taxes | 0 | 0 | |
Net Loss | (26,476,370) | (21,875,713) | (19,633,502) |
Preferred Stock Dividends | (1,931,860) | (1,820,168) | (1,714,934) |
Loss Attributable to Common Stockholders | $ (28,408,230) | $ (23,695,881) | $ (21,348,436) |
Basic and Diluted Loss per Share | $ (0.94) | $ (0.87) | $ (1.02) |
Weighted-average Shares Outstanding - Basic and Diluted | 30,348,452 | 27,182,560 | 21,013,907 |
Products Sold | |||
Sales: | |||
Total Sales | $ 5,997,453 | $ 7,692,102 | $ 4,548,689 |
Cost of Sales: | |||
Cost of Sales | 6,334,333 | 6,072,476 | 5,269,900 |
Inventory Reserve for Obsolescence | |||
Cost of Sales: | |||
Cost of Sales | 4,572,659 | ||
Sales of Engineering Services | |||
Sales: | |||
Total Sales | 673,151 | 402,266 | 989,064 |
Cost of Sales: | |||
Cost of Sales | $ 171,733 | $ 253,610 | $ 944,451 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Cash Flows from Operating Activities | |||
Net Loss | $ (26,476,370) | $ (21,875,713) | $ (19,633,502) |
Non-Cash Adjustments | |||
Depreciation and Amortization | 2,441,581 | 1,469,664 | 998,528 |
Amortization of Software Development Costs in Cost of Sales - Products | 100,000 | 100,000 | 214,838 |
Stock-Based Compensation | 1,498,357 | 2,272,481 | 1,852,022 |
Loss on Disposal of Fixed Assets | 55,172 | 585 | |
Amortization of Term Debt Discounts and Deferred Issuance Costs | 0 | 175,260 | |
Loss on Derivative Valuation | 13,873 | (20,204) | |
Impairment of Software Development Cost | 196,223 | 0 | |
Inventory reserve for Obsolescence | 4,572,659 | 0 | 0 |
Loss (Gain) on Inventory Revaluation and Product Discontinuance | (211,416) | 1,151,482 | |
(Increase) Decrease in Operating Assets | |||
Accounts Receivable | (599,577) | 201,836 | (870,858) |
Accrued Project Revenue | 497,784 | (497,784) | |
Inventories | (2,998,724) | (3,429,485) | (2,352,581) |
Manufacturer Vendor Prepayments | 512,680 | (600,502) | (10,549) |
Prepaid Expenses and Other Assets | 414,997 | (69,959) | (9,288) |
Increase (Decrease) in Operating Liabilities | |||
Accounts Payable | (1,605,456) | (846,399) | 2,640,584 |
Accrued Expenses | 21,819 | (26,789) | 554,832 |
Customer Deposits | (152,362) | 78,900 | 7,300 |
Unearned Revenue | (69,263) | 103,902 | (401,748) |
Other Taxes | (15,361) | 26,758 | (8,790) |
Accrued Compensation | (327,469) | (321,250) | |
Accrued Interest | (171,435) | 65,417 | |
Net Cash Flows Used in Operating Activities | (22,355,020) | (22,542,574) | (16,465,706) |
Cash Flows from Investing Activities | |||
Purchase of Fixed Assets | (1,898,771) | (1,365,388) | (1,681,258) |
Investments in Patents and Trademarks | (250,304) | (444,906) | (599,444) |
Investments in Licenses and Other Intangible Assets | (758,464) | (1,250,000) | 0 |
Notes Receivable | (250,000) | 0 | 0 |
Investments in Software Development | (87,500) | (408,723) | |
Net Cash Used in Investing Activities | (3,157,539) | (3,147,794) | (2,689,425) |
Cash Flows from Financing Activities | |||
Proceeds from Exercise of Warrants | 39,375 | 0 | |
Proceeds from Common Stock Offerings | 20,000,007 | 30,000,000 | 21,128,502 |
Issuance Costs on Common Stock Offerings | (1,145,000) | (1,975,000) | (1,617,679) |
Net Cash Flows from Financing Activities | 18,855,007 | 28,064,375 | 19,510,823 |
Net Increase (Decrease) in Cash and Cash Equivalents | (6,657,552) | 2,374,007 | 355,692 |
Cash and Cash Equivalents - Beginning of Period | 17,263,643 | 14,889,636 | 14,533,944 |
Cash and Cash Equivalents - End of Period | 10,606,091 | 17,263,643 | 14,889,636 |
Supplemental Disclosures | |||
Interest Paid in Cash | 19,128 | 22,814 | |
Non-cash Investing and Financing Activities | |||
Common Stock Issued for Services included in Prepaid Expenses | 83,475 | 25,000 | 0 |
Investment in Other Intangible Assets included in Accrued Expenses | 750,000 | 0 | |
Conversion of Term Debt and Accrued Interest into Common Stock | 0 | 1,861,283 | |
Reclassification of Derivative Liability Upon Warrant Exercise | 166,800 | 0 | |
Cumulative Revenue Adjustment - ASC 606 Adoption | 81,724 | 0 | |
Stock-Based Compensation Expense - Expensed less Previously Issued | $ 93,587 | $ 678,815 | $ 0 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | VUZIX CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Note 1 — Summary of Significant Accounting Policies Operations Vuzix Corporation (the Company) was formed in 1997 under the laws of the State of Delaware and maintains its corporate offices in Rochester, New York. We are engaged in the design, manufacture, marketing and sale of augmented reality wearable display and computing devices also referred to as head mounted displays (or HMDs, but also known as near-eye displays), in the form of Smart Glasses and Augmented Reality (AR) glasses. Our AR wearable display devices are worn like eyeglasses or attach to a head worn mount. These devices typically include cameras, sensors, and a computer that enable the user to view, record and interact with video and digital content, such as computer data, the Internet, social media or entertainment applications. Our wearable display products integrate micro-display technology with our advanced optics to produce compact high-resolution display engines, less than half an inch diagonally, which when viewed through our smart glasses products create virtual images that appear comparable in size to that of a computer monitor or a large-screen television. The wearable display products we produce can be used for a variety of enterprise and commercial users and applications, including AR for on-the-go users and as mobile displays for entertainment and social media use. Our products are available with varying features and are offered as monocular display systems. Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, Vuzix Europe Limited. All significant inter-company transactions have been eliminated. Certain prior year amounts have been reclassified to be consistent with current year presentation. Segment Data, Geographic Information and Significant Customers The Company is not organized by market and is managed and operated as one business. A single management team that reports to the chief operating decision maker comprehensively manages the entire business. The Company does not operate any material separate lines of business or separate business entities. Accordingly, the Company does not accumulate discrete information, other than product revenue and material costs, with respect to separate product lines and does not have separately reportable segments as defined by FASB ASC Topic 280, “Disclosures about Segments of an Enterprise and Related Information”. Refer to Note 18 — Geographic and Other Financial Information (Unaudited). Foreign Currency Transactions The Company considers the US dollar as the functional currency of the Company’s UK Subsidiary. The Company’s UK Subsidiary transacts in Euros and British pounds. All transactions in foreign currencies are recorded in US dollars at the then current exchange rate(s). Upon settlement of the underlying transaction, all amounts are re-measured to US dollars at the current exchange rate on date of settlement. All unsettled foreign currency transactions that remain in accounts receivable and trade account payables are re-measured to US dollars at the period end exchange rates. All re-measurement gains and losses are recorded in the current period net income. Use of Estimates The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at year-end and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Concentration of Credit Risk The Company maintains its cash in bank deposit accounts, which at times may exceed federally insured limits. Cash and Cash Equivalents Cash and cash equivalents can include highly liquid investments with original maturities of three months or less. Fair Value of Financial Instruments The Company’s financial instruments primarily consist of cash and cash equivalents, accounts receivable, notes receivable, accounts payable, customer deposits, accrued expenses, and income taxes payable. As of the consolidated balance sheet dates, the estimated fair values of the financial instruments were not materially different from their carrying values as presented due to the short maturities of these instruments. Accounts Receivable The Company carries its trade accounts receivable at invoice amount less an allowance for doubtful accounts. The Company establishes an allowance for uncollectible trade accounts receivable based on the age of outstanding invoices and management’s evaluation of collectability of outstanding balances. These provisions are established when the aging of outstanding amounts exceeds allowable terms and are re-evaluated at each quarter end for adequacy. In determining the adequacy of the provision, the Company considers known uncollectible or at-risk receivables. The allowance for doubtful accounts as of December 31, 2019 and 2018 was nil and $7,280, respectively. The Company does not accrue interest on any past due accounts receivable unless such receivable goes into collection. Notes Receivable On December 17, 2019, the Company provided a one-year convertible promissory note to a confidential strategic business partner for $250,000. The note carries an interest rate of 8%, compounded monthly. The principal and accrued interest become due and payable to the Company on November 15, 2020. The note contains mandatory and automatic conversions of principal and accrued interest into equity upon on the occurrence of a triggering event at a pre-defined conversion price range. The pre-defined conversion price range if triggered, would result in the Company owning 1 to 2.5% of this entity. Customer Concentrations Foxconn Technology Group, or Foxconn (f/k/a Toshiba Japan) represented 16% of total product revenue and one confidential defense customer represented 100% of engineering services revenue for the year ended December 31, 2019. Foxconn, SATS Airport Services Pte Ltd and AMA SA represented 17%, 10% and 10% of our total revenues in 2018, respectively. Foxconn represented 18% of our total revenue in 2017. Ubimax GmbH, Foxconn and a confidential defense customer represented 32%, 26% and 13%, respectively, of accounts receivable at December 31, 2019. Foxconn and SATS represented 32% and 38%, respectively, of accounts receivable at December 31, 2018. Foxconn represented 25% of accounts receivable and 100% of accrued project revenues at December 31, 2017. Accrued Project Revenue The Company carries accrued project revenue based on the percentage of completion on the project measured using the input method based upon costs incurred to-date as a percentage of total expected costs to complete the project less amounts invoiced, if any. As of December 31, 2019 and 2018, we had nil in accrued project revenue. Inventories Inventories are valued at the lower of cost or net realizable value using the weighted average first-in, first-out method. The Company includes labor and overhead costs in its inventory valuation costing. The Company records provisions for excess, obsolete or slow-moving inventory based on changes in customer demand, technology developments or other economic factors. The Company’s products have product life cycles that range on average from two to three years currently. At both the product introduction and product discontinuation stage, there is a higher degree of risk of inventory obsolescence. The provision for obsolete and excess inventory is evaluated for adequacy at each quarter end. The estimate of the provision for obsolete and excess inventory is partially based on expected future product sales, which are difficult to forecast for certain products. Revenue Recognition The Company adopted the new guidance on Revenue from Contracts with Customers under FASB ASC Topic 606, "Revenue from Contracts with Customers", as of January 1, 2018. Refer to Note 2 for further discussion on the impact of this adoption. Product sales represent the majority of the Company’s revenue. The Company recognizes revenue from these product sales as performance obligations are satisfied and transfer of control and ownership to the customer has occurred, typically upon physical shipment. Revenue is recognized in the amount that the Company expects to receive in exchange from the sale of our products. FOB shipping point is our standard shipping terms and revenue is recognized as our products ship to customers, as control and ownership are transferred at this point in time. All of our standard products sales include a 30‑day money back guarantee and expected returns are estimated at each reporting period date and a portion of revenue is deferred for all estimated returns. As of December 31, 2019, deferred revenue associated with our expected returns was immaterial. The Company collects and remits sales taxes in certain jurisdictions and reports revenue net of any associated sales taxes. Revenue from any engineering consulting and other services is recognized at the time the services are rendered. The Company accounts for its longer-term development contracts, which to date have all been firm fixed-priced contracts, on the percentage-of-completion method, whereby income is recognized as work on contracts progresses, but estimated losses on contracts in progress are charged to operations immediately. The percentage-of-completion is determined using the cost-to-cost method. To date, all such contracts have been less than one calendar year in duration. Unearned Revenue These amounts represent deferred revenue against unfulfilled performance obligations such as extended product warranty sales and sales of our Vuzix Basic Video applications, which are amortized over a twelve (12) month period. Customer Deposits Customer deposits represent money the Company has received in advance of providing a product or engineering services to a customer. All such deposits are short term in nature as the Company typically delivers the product or engineering services provided to the customer within one year. These deposits are credited to the customer against product deliveries or at the completion of the customer’s order. As of December 31, 2019 and 2018, we had nil and $152,362 in outstanding customer deposits. Cost of Product Revenues Cost of product revenue includes the direct and allocated indirect costs of products sold to customers. Direct costs include labor, materials, reserves for estimated warranty expenses, and other costs incurred directly, or charged to us by our contract manufacturers in the manufacture of these products. Indirect costs include labor, manufacturing overhead, and other costs associated with operating our manufacturing facility and capacity. Manufacturing overhead includes the costs of procuring, inspecting and storing material, facility and other costs, and is allocated to cost of product revenue based on the proportion of indirect labor which supported production activities. Depreciation on manufacturing tools and equipment is included in Operating Expenses in our consolidated statement of operations. The cost of product revenue can fluctuate significantly from period to period, depending on the product mix and volume, the level of manufacturing overhead expense and the volume of direct material purchased. Cost of Engineering Services Revenues Cost of engineering services revenues includes both the direct and allocated indirect costs of performing on contracts and producing prototype units. Direct costs include labor, materials and other costs incurred directly in performing under the contract. Direct costs also include labor and other costs associated with operating our research and development department based on the level of effort supporting the development activity. Cost of contract revenue is determined by the level of direct and indirect costs incurred, which can fluctuate substantially from period to period. Fixed Assets Fixed assets are stated at cost. Depreciation of fixed assets is provided for using the straight-line method over the following estimated useful lives: Computers and Purchased Software 3 years Leasehold Improvements Lesser of expected life or lease term Manufacturing Equipment 5 years Tooling 3 years Furniture and Equipment 5 years Repairs and maintenance costs are expensed as incurred. Asset betterments are capitalized and depreciated over their expected useful life. Patents and Trademarks The Company capitalizes the costs of obtaining its patents and registration of trademarks. Such costs are accumulated and capitalized during the filing periods, which can take several years to complete. Successful applications that result in the granting of a patent or trademark are then amortized over 15 years on a straight-line basis. Unsuccessful applications are written off and expensed in the fiscal period where the application is abandoned or discontinued. Software Development Costs The Company capitalizes the costs of obtaining or developing its software once technological feasibility has been determined by management. Such costs are accumulated and capitalized. Projects can take several years to complete. Unsuccessful or discontinued software projects are written off and expensed in the fiscal period when the software development effort is abandoned or discontinued. Costs incurred internally in researching and developing a computer software product are charged to expense until technological feasibility has been established for the product. Once technological feasibility is established, all software costs are capitalized until the product is available for general release to customers. Judgment is required in determining when technological feasibility of a product is established. Once the product is available for general release, accumulated costs are amortized over the life of the asset. The amortization of these costs is included in cost of revenue over the estimated life of the products, which currently is estimated as three years using a straight-line basis. As of December 31, 2019, we had $100,000 of net software development costs included in Other Assets. For the years ended December 31, 2019 and 2018, there was nil and $196,223, respectively in software impairment costs. Licenses The Company capitalizes the costs of acquiring licenses and prepaid royalties. They are amortized on either a per unit basis or straight line over the life of the license. In some cases, future royalties are subject to annual limits. Long-Lived Assets The Company at least annually assesses all of its long-lived assets for impairment when events or circumstances indicate their carrying amounts may not be recoverable, in accordance with FASB ASC Topic 360‑10, “Accounting for the Impairment or Disposal of Long-Lived Assets.” There was no impairment charge in 2019, 2018 and 2017. Research and Development Research and development costs are expensed as incurred consistent with the guidance of FASB ASC Topic 730, “Research and Development,” and include employee related costs, office expenses, third-party design and engineering services, and new product prototyping costs. Costs incurred internally in researching and developing a computer software product are charged to expense until technological feasibility has been established for the product. Shipping and Handling Costs Amounts charged to customers and costs incurred by the Company related to shipping and handling are included in net sales and cost of sales, respectively. Provision for Future Warranty Costs The Company provides for the estimated returns under warranty and the costs of fulfilling our obligations under product warranties at the time the related revenue is recognized. The Company estimates the costs based on historical and projected product failure rates, historical and projected repair costs, and knowledge of specific product failures (if any). The specific warranty terms and conditions vary depending upon the country in which we do business, but generally include parts and labor over a period generally ranging from one to two years from the date of product shipment. The Company provides a reserve for expected future warranty returns at the time of product shipment or produces over-builds to cover replacements. We regularly reevaluate our estimates to assess the adequacy of the recorded warranty liabilities and adjust the amounts as necessary each quarter end, based on historical experience of warranty claims and costs. Advertising Advertising costs are expensed as incurred and recorded in “Selling and Marketing” in the Consolidated Statements of Operations. Advertising expense for the years ended December 31, 2019, 2018 and 2017 was $1,302,120, $1,631,161 and $1,386,977, respectively. Income Taxes The Company accounts for income taxes in accordance with FASB ASC Topic 740‑10, “Income Taxes.” Accordingly, the Company provides deferred income tax assets and liabilities based on the estimated future tax effects of differences between the financial and tax bases of assets and liabilities based on currently enacted tax laws. A valuation allowance is established for deferred tax assets in amounts for which realization is not considered more likely than not to occur. The Company reports any interest and penalties accrued relating to uncertain income tax positions as a component of the income tax provision. Net Loss Per Share Basic earnings per share is computed by dividing the net income (loss) less accrued dividends on any outstanding preferred stock by the weighted average number of common shares outstanding for the period. Diluted earnings per share calculations reflect the assumed exercise of all dilutive employee stock options and warrants applying the treasury stock method promulgated by FASB ASC Topic 260, “Earnings Per Share” and the conversion of any outstanding convertible preferred shares or notes payable that are-in-the-money, applying the as-if-converted method. However, if the assumed exercise of stock options and warrants and the conversion of any preferred shares or convertible notes payable are anti-dilutive, basic and diluted earnings per share are the same for all periods. As a result of the net losses generated in 2019, 2018 and 2017, all outstanding instruments would be antidilutive. As of December 31, 2019, 2018 and 2017, there were 12,858,707, 8,742,183 and 7,657,756 common stock share equivalents, respectively, that were potentially issuable under convertible debt agreements, options, conversion of preferred shares (excluding accrued dividends), and warrants that could potentially dilute basic earnings per share in the future. Stock-Based Compensation Expense The Company accounts for stock-based compensation to employees and directors in accordance with FASB ASC Topic 718 “Compensation - Stock Compensation,” which requires that compensation expense be recognized in the consolidated financial statements for stock-based awards based on the grant date fair value. For stock option awards, the Black-Scholes-Merton option pricing model was used to estimate the fair value of share-based awards under FASB ASC Topic 718. The Black-Scholes-Merton option pricing model incorporates various and highly subjective assumptions, including expected term and share price volatility. The expected term of options granted was estimated to be the average of the vesting term, historical exercise and forfeiture rates, and the contractual life of the option. The share price volatility at the grant date is estimated using historical stock prices based upon the expected term of the options granted. The risk-free interest rate assumption is determined using the rates for U.S. Treasury zero-coupon bonds with maturities similar to those of the expected term of the award being valued. For common stock awards, the Company uses the fair market value of our common stock on the date of each stock-based award based on the market price of the Company’s common shares and the expense related to these awards is recognized over the requisite service period of the awards on a straight-line or graded vesting basis, which is generally commensurate with the vesting term. Stock-based compensation expense associated with stock awards and stock option grants for the years ended December 31, 2019, 2018 and 2017 was $1,498,357, $2,197,481 and $1,623,272, respectively. The Company issues new shares upon stock option exercises. Leases The Company determines if an arrangement is a lease at inception. Our lease agreements generally contain lease and non-lease components. Historically, non-lease components such as utilities have been immaterial. Payments under our lease arrangements are primarily fixed. Lease assets and liabilities are recognized at the present value of the future lease payments at the lease commencement date. The interest rate used to determine the present value of the future lease payments is our incremental borrowing rate, because the interest rate implicit in our leases is not readily determinable. Our incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments, and in economic environments where the leased asset is located. Our lease terms include periods under options to extend or terminate the lease when it is reasonably certain that we will exercise that option. As of December 31, 2019, all of our leases are considered operating leases. Operating right of use assets and liabilities are included on our Consolidated Balance Sheets beginning January 1, 2019. The Company does not have any finance leases as of December 31, 2019. Recent Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (the “FASB”) issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326). ASU 2016-13 provides for a new impairment model which requires measurement and recognition of expected credit losses for most financial assets and certain other instruments, including but not limited to accounts receivable. ASU 2016-13 will become effective for the Company on January 1, 2023 and early adoption is permitted. The Company does not anticipate the adoption of this standard will have a material impact on our consolidated financial statements. |
Revenue Recognition and Contrac
Revenue Recognition and Contracts with Customers | 12 Months Ended |
Dec. 31, 2019 | |
Revenue Recognition and Contracts with Customers | |
Revenue Recognition and Contracts with Customers | Note 2 – Revenue Recognition and Contracts with Customers Disaggregated Revenue The Company’s total revenue was comprised of four major product lines: Smart Glasses and iWear Video Headphone Sales, OEM Product Sales, Waveguide and Display Engine Sales, and Engineering Services. The following table summarizes the revenue recognized by major product line: For the Years Ended December 31, 2019 2018 2017 Revenues Smart Glasses and iWear Video Headphones Sales $ 4,893,384 $ 6,512,202 $ 4,197,633 OEM Product Sales 951,570 994,500 — Waveguide and Display Engine Sales 152,499 185,400 351,056 Engineering Services 673,151 402,266 989,064 Total Revenue $ 6,670,604 $ 8,094,368 $ 5,537,753 Significant Judgments Under Topic 606, there are judgments used that could potentially impact both the timing of our satisfaction of performance obligations and our determination of transaction prices used in determining revenue recognized by major product line. Judgments made include considerations in determining our transaction prices for our standard product sales that include an end-user 30-day right to return if not satisfied with product and include general payment terms that are between Net 30 and 60 days. For our Engineering Services, performance obligations are recognized over time using the input method and the estimated costs to complete each project are considered significant judgments. Performance Obligations Revenues from our performance obligations are typically satisfied at a point in time for Smart Glasses, Waveguides and Display Engines, and our OEM Products, which are recognized when the customer obtains control and ownership, which is generally upon shipment. The Company also records revenue for performance obligations relating to our Engineering Services over time by using the input method measuring progress toward satisfying the performance obligations. Satisfaction of our performance obligations related to our Engineering Services is measured by the Company’s cost incurred as a percentage of total expected costs to project completion as the inputs of actual costs incurred by the Company are directly correlated with progress of completing the contract. As such, the Company believes that our methodologies for recognizing revenue over time for our Engineering Services correlate directly with the transfer of control of the underlying assets to our customers. Our standard product sales include a twelve (12) month assurance-type product warranty, except in certain European countries where it can be twenty-four (24) months for some consumer-focused products. In the case of our OEM products and waveguide sales, some include a standard product warranty of up to eighteen (18) months. In 2018, we began offering extended warranties to customers, which extend the standard product warranty on product sales for an additional twelve (12) month period. All revenue related to extended product warranty sales is deferred and recognized over the extended warranty period. Our engineering services contracts vary from contract to contract but typically include payment terms of Net 30 days from date of billing, subject to an agreed upon customer acceptance period. The following table presents a summary of the Company’s net sales by revenue recognition method as a percentage of total net sales for the year ended December 31, 2019: % of Total Net Sales Point-in-Time – Output Method 90 % Over Time – Input Method 10 % Total 100 % Remaining Performance Obligations As of December 31, 2019, the Company had $123,000 of remaining performance obligations related to its extended warranties, which are included in deferred revenue on our Consolidated Balance Sheets. The Company is recognizing this deferred revenue on a straight-line basis ending on September 30, 2020. |
Going Concern
Going Concern | 12 Months Ended |
Dec. 31, 2019 | |
Going Concern | |
Going Concern | Note 3 — Going Concern The accompanying consolidated financial statements have been prepared assuming that we will continue as a going concern. This basis of accounting contemplates the recovery of our assets and the satisfaction of liabilities in the normal course of business. These consolidated financial statements do not include any adjustments to the specific amounts and classifications of assets and liabilities, which might be necessary should we be unable to continue as a going concern. The Company incurred annual net losses for the years ended December 31, 2019, 2018 and 2017 of $26,476,370, $21,875,713 and $19,633,502, respectively. As of December 31, 2019, the Company had an accumulated deficit of $144,742,811. The Company’s cash requirements are primarily for funding operating losses, research and development, working capital, and capital expenditures. Our cash requirements related to funding operating losses depend on numerous factors, including new product development activities, our ability to commercialize our products, our products’ timely market acceptance, selling prices and gross margins, and other factors. Historically, the Company has met its cash needs primarily by the sale of equity securities. The Company’s management intends to take actions necessary to continue as a going concern, as discussed herein. The Company will need to grow its business significantly to become profitable and self-sustaining on a cash flow basis or it will be required to raise new equity and/or debt capital. Management’s plans concerning these matters and managing our liquidity include, among other things: · the continued sale of our existing M300XL finished goods and Blade component inventory, of which we have significant levels; · the expected success of our third-generation monocular device for enterprise, the M400 Smart Glasses. This product entered mass production near the end of the third quarter of 2019, and to date customer interest and adoption of the M400 has been more rapid than earlier models; · the commencement of volume manufacturing and sale of the new Vuzix Smart Swim product in the second quarter of 2020; · the timely sale and disposal of as many products and components as possible included in our write-down losses on the M300 Smart Glasses and excess components related to the cessation of production of it and the M300-C Smart Glasses in China. Management intends to seek to recover some cash from the $4,572,659 of inventory reserved for in the year ended December 31, 2019; · increase our efforts to further promote our engineering services programs, which result in overall larger gross margins by absorbing some of our operating costs by utilizing a significant portion of our internal engineering fixed salary costs; · continue to pursue licensing and strategic opportunities around our waveguide technologies with potential OEMs, which would include the receipt of upfront licensing fees and supply agreements; · greater control of operating costs and reductions in spending growth rates wherever possible; · decrease tradeshow and external PR expenditures; · right-size operations across all areas of the Company, including head-count and salary freezes and overall spending; · delay or curtail discretionary and non-essential capital expenditures not related to near-term new products; · reduce the rate of new product introductions and leverage existing platforms to reduce new product development and engineering costs; · the introduction of the M4000 in late Q2-2020 will be the Company’s next generation see-through waveguide-based product specifically designed for the enterprise market; and · further reduce the rate of research and development spending on new technologies, particularly the use of external contractors. Historically, the Company has met its cash needs primarily through the sale of equity securities. On July 1, 2019, the Company entered into a securities purchase agreement with certain purchasers for the sale of an aggregate of 5,479,454 shares of the Company’s common stock along with warrants to purchase an aggregate of up to 5,479,454 additional shares of common stock, in a registered direct offering at a combined purchase price of $3.65 per share and warrant for aggregate gross sale proceeds of $20,000,007. The purchase agreement closed on July 2, 2019. The Company received net proceeds after issuance costs and expenses of $18,855,007. The warrants sold in the offering are exercisable for a period of two years commencing six months from the issuance date at an exercise price of $4.10 per share. Based upon our current amount of cash on hand, management’s historical ability to raise capital, and our ability to manage our cost structure and adjust operating plans if and as required, we have concluded that substantial doubt of our ability to continue as a going concern has been alleviated. |
Inventories, Net
Inventories, Net | 12 Months Ended |
Dec. 31, 2019 | |
Inventories, Net | |
Inventories | Note 4 — Inventories, Net Inventories consisted of the following: December 31, December 31, 2019 2018 Purchased Parts and Components $ 5,985,214 $ 3,284,848 Work in Process 2,414,142 1,523,616 Finished Goods 2,096,744 2,837,183 Less: Reserve for Obsolescence (4,788,233) (363,845) Inventories, Net $ 5,707,867 $ 7,281,802 In addition to its normal Reserve for Obsolescence provision, (i) the Company wrote down to net realizable value all of its component inventory parts related to its M300 and M300XL Smart Glasses products, resulting from the decision to end their production as they are at a disadvantaged selling position against our newer, improved M400 introduced in the fall of 2019. The total net realizable value write-down recorded at December 31, 2019 was $3,153,028, and (ii) the Company recorded an additional obsolescence provision of $1,419,631 related to its legacy M300 finished goods on hand as of December 31, 2019. The write-down and obsolescence provision totaled $4,572,659 for the year ended and as of December 31, 2019. These provisions were included in Cost of Sales on the Consolidated Statements of Operations. |
Fixed Assets, Net
Fixed Assets, Net | 12 Months Ended |
Dec. 31, 2019 | |
Fixed Assets, Net | |
Fixed Assets, Net | Note 5 — Fixed Assets, Net Fixed Assets consisted of the following: December 31, December 31, 2019 2018 Tooling and Manufacturing Equipment $ 5,262,080 $ 4,199,309 Leaseholds 773,734 487,957 Computers and Purchased Software 824,965 937,946 Furniture and Equipment 2,043,355 1,721,963 8,904,134 7,347,175 Less: Accumulated Depreciation (4,576,458) (3,055,485) Fixed Assets, Net $ 4,327,676 $ 4,291,690 Total depreciation expense for fixed assets for the years ended December 31, 2019, 2018 and 2017 was $1,913,409, $1,273,527 and $921,113, respectively. |
Patents and Trademarks, Net
Patents and Trademarks, Net | 12 Months Ended |
Dec. 31, 2019 | |
Patents and Trademarks, Net | |
Patents and Trademarks, Net | Note 6 — Patents and Trademarks, Net December 31, December 31, 2019 2018 Patents and Trademarks $ 2,020,070 $ 1,769,767 Less: Accumulated Amortization (725,395) (605,224) Patents and Trademarks, Net $ 1,294,675 $ 1,164,543 Total amortization expense for patents and trademarks for the years ended December 31, 2019, 2018 and 2017 was $120,172, $94,137 and $77,415, respectively. The estimated aggregate annual amortization expense for each of the next five fiscal years is approximately $135,000. We recorded no patent impairment charges for the years ended December 31, 2019, 2018 and 2017. |
Licenses, Net
Licenses, Net | 12 Months Ended |
Dec. 31, 2019 | |
Licenses, Net | |
Licenses, Net | Note 7 — Licenses, Net December 31, December 31, 2019 2018 Licenses $ 493,717 $ 493,717 Less: Accumulated Amortization (179,301) (56,597) Licenses, Net $ 314,416 $ 437,120 On October 4, 2018, the Company invested in WakingApp Ltd., a private corporation in the augmented reality software tool market. The Company participated in a financing round with other investors that resulted in the Company acquiring less than a 1% ownership interest, in the form of preferred stock, in WakingApp Ltd., for a purchase price of $250,000. As part of this investment, the Company entered into a commercial agreement with WakingApp such that WakingApp agreed to: (i) provide full support of the Company’s AR products through the WakingApp AR tool software; (ii) provide three (3) working AR environments built with their tools to give away as demonstrations on the M300 and M300XL; and (iii) allow the Company to provide 60-day free licenses to their AR software tool to up to 100,000 of the Company’s developers and customers. The Company considers this investment as a prepaid licensing arrangement over a 36-month term; as such, this addition will be amortized over three years and included in Cost of Sales – Products in the Consolidated Statement of Operations. The Company acquired two licenses in 2017. The first related to the renegotiation of an existing license at a cost of $114,967, which will result in lower royalty rates being paid by the Company over the next 10 years. This license went into effect as of January 1, 2018. The second license was a result of the Company entering into a Technology Acquisition Agreement where it acquired all the seller’s right, title and interest in certain Transferred Intellectual Property (IP). Pursuant to the agreement, the Company paid approximately $75,702 as reimbursement of related patent application costs incurred by the seller to date, which are included in Patents and Trademarks. The Company also issued 25,000 shares, valued at $128,750, upon the closing and will issue (i) a further 25,000 shares after the Company has successfully developed a working demonstrator system utilizing the IP; and (ii) 50,000 shares once the Company completes the successful commercialization of products containing the IP for sale in the marketplace. The Company estimates that, by end of 2021, it should be able to achieve the first development milestone of a functional demonstrator model and that it will need to spend a further $250,000 in additional R&D. Total amortization expense related to licenses in the years ended December 31, 2019, 2018 and 2017 was $122,704, $56,597, and $0, respectively. |
Intangible Asset, Net
Intangible Asset, Net | 12 Months Ended |
Dec. 31, 2019 | |
Intangible Asset, Net | |
Intangible Asset, Net | Note 8 — Intangible Asset, Net December 31, December 31, 2019 2018 Intangible Asset $ 1,500,000 $ 1,500,000 Less: Accumulated Amortization (510,000) (102,000) Intangible Asset, Net $ 990,000 $ 1,398,000 On October 4, 2018, the Company entered into amendment No. 1 to agreements (the “TDG Amendment”), with TDG Acquisition Company, LLC (“TDG”), aka Six15 Technologies, LLC. The TDG Amendment amends certain provisions of prior agreements between Vuzix and TDG, including an asset purchase agreement dated June 15, 2012, and an authorized reseller agreement dated June 15, 2012. Pursuant to the TDG Amendment, the Company will be permitted to engage in sales of heads-up display components or subsystems (and any services to support such sale) for incorporation into a finished good or system for sale to military organizations, subject to certain conditions. The Company will also be permitted to sell its products to defense and security organizations that include business customers and governmental entity customers that primarily provide security and defense services, including police, fire fighters, EMTs, other first responders, and homeland and border security. The Company will owe TDG commissions with respect to all such sales until June 2022. Total commissions expense under this agreement for the years ended December 31, 2019 and 2018 was $116,469 and nil, respectively. Total amortization expense for this intangible asset for the years ended December 31, 2019 and 2018 was $408,000 and $102,000, respectively. Future monthly amortization expense for the next 29 months is $34,000 per month. |
Other Assets
Other Assets | 12 Months Ended |
Dec. 31, 2019 | |
Other Assets | |
Other Assets | Note 9 – Other Assets The Company’s other assets consists of the following: December 31, December 31, 2019 2018 Other $ — $ 9,192 Private Corporation Investment 250,000 250,000 Total Other Assets, Non-Amortizing 250,000 259,192 Software Development Costs 300,000 496,223 Less: Accumulated Amortization (200,000) (100,000) Less: Impairment — (196,223) Software Development Costs, Net 100,000 200,000 Total Other Assets $ 350,000 $ 459,192 In the second quarter of 2018, the Company acquired, for a purchase price of $250,000, approximately a 1% ownership interest, in the form of preferred stock, in a private corporation in the low vision near eye display market, which the Company has valued at cost. This investment was recorded at cost as its fair value is not readily determinable. The Company has reviewed this investment and concluded that there were no indicators of impairment present as of December 31, 2019. Total amortization expense for capitalized software development costs for the years ended December 31, 2019, 2018 and 2017 was $100,000, $100,000 and $214,838, respectively. The remaining costs of $100,000 are being amortized over one year and are included in Cost of Sales – Products in the Consolidated Statements of Operations. During the year ended December 31, 2018, a $196,223 impairment charge was recorded related to previously capitalized costs related to application software being developed for our M300 Smart Glasses, which was not expected to achieve expected revenue projections and was discontinued in 2018. |
Accrued Expenses
Accrued Expenses | 12 Months Ended |
Dec. 31, 2019 | |
Accrued Expenses | |
Accrued Expenses | Note 10 — Accrued Expenses Accrued expenses consisted of the following: December 31, December 31, 2019 2018 Accrued Wages and Related Costs $ 394,669 $ 461,619 Accrued Professional Services 217,721 138,438 Accrued Warranty Obligations 98,893 218,047 Other Accrued Expenses 174,614 795,974 Total $ 885,897 $ 1,614,078 Included in Other Accrued Expenses as of December 31, 2018 was $750,000 for the second and third payments described above in Note 8 related to the TDG Amendment. The Company has warranty obligations in connection with the sale of certain of its products. The warranty period for its products is generally twelve (12) months except in certain European countries where it can be twenty-four (24) months for some consumer-focused products. The costs incurred to provide for these warranty obligations are estimated and recorded as an accrued liability at the time of sale. The Company estimates its future warranty costs based on product-based historical performance rates and related costs to repair. The changes in the Company’s accrued warranty obligations for the years ended December 31, 2019, 2018 and 2017 were as follows: Accrued Warranty Obligations at December 31, 2016 $ 41,132 Reductions for Settling Warranties (157,035) Warranty Issued During Year 283,406 Accrued Warranty Obligations at December 31, 2017 167,503 Reductions for Settling Warranties (257,173) Warranty Issued During Year 307,717 Accrued Warranty Obligations at December 31, 2018 218,047 Reductions for Settling Warranties (204,583) Warranty Issued During Year 85,429 Accrued Warranty Obligations at December 31, 2019 $ 98,893 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Taxes | |
Income Taxes | Note 11 — Income Taxes The Company files U.S. federal and various state and foreign tax returns. Pre-tax earnings consisted of the following for the years ended: December 31, December 31, December 31, 2019 2018 2017 Pre-Tax Income (Loss) U.S. $ (26,482,033) $ (22,082,137) $ (19,680,720) Outside the U.S. 5,663 206,424 47,218 Total Pre-Tax Income (Loss) $ (26,476,370) $ (21,875,713) $ (19,633,502) The provision expense/(benefit) for income taxes for the years ended December 31, 2019, 2018 and 2017 was as follows: 2019 2018 2017 U.S. Income Taxes: Current Provision $ — $ — $ — Deferred Provision (5,382,746) (4,848,470) 3,639,752 Valuation Allowance 5,382,746 4,848,470 (3,639,752) Income Taxes Outside the U.S.: Current Provision — — — Deferred Provision (511,672) 41,285 215,745 Valuation Allowance 511,672 (41,285) (215,745) State Income Taxes: Current Provision — — — Deferred Provision (189,200) (140,933) (59,530) Valuation Allowance 189,200 140,933 59,530 Total Provision $ — $ — $ — A reconciliation of the statutory U.S. federal income tax rate to the effective rates for the years ended December 31, 2019, 2018 and 2017 is as follows: 2019 2018 2017 % % % Federal Income Tax at Statutory Rate 21.0 21.0 34.0 State Tax Provision, Net of Federal Benefit 0.3 0.3 0.3 Change in Corporate Tax Rates from 34% to 21% — — (52.9) Permanent Differences (0.1) (1.5) (2.4) Federal Tax Credits 1.3 2.5 1.1 Stock Compensation (1.9) — — Foreign Tax Provision 1.9 — — Other 0.5 0.3 0.6 Effective Tax Rate 23.0 22.6 (19.3) Change in Valuation Allowance (23.0) (22.6) 19.3 Net Effective Tax Rate — — — Significant components of the Company’s deferred tax assets and liabilities at year end are as follows: December 31, December 31, December 31, 2019 2018 2017 Deferred Tax Assets: Net Operating Loss Carry-forwards $ 25,678,591 $ 20,920,285 $ 16,167,791 Tax Credit Carry-forwards 3,535,863 3,035,384 2,404,490 Inventory Valuation Adjustment 982,160 104,450 675,830 Officer’s Compensation — — 86,670 Stock-based Compensation — 175,753 — Lease Obligation Liability 446,488 — — Other 263,348 207,327 108,734 Total Deferred Tax Assets 30,906,450 24,443,199 19,443,515 Deferred Tax Liabilities: Income from Foreign Operations — 59,123 17,838 Lease Right of Use Asset 446,488 — — Other 14,335 22,069 11,789 Total Deferred Tax Liabilities 460,823 81,192 29,627 Net Deferred Tax Assets Before Valuation Allowance $ 30,445,627 $ 24,362,007 $ 19,413,888 Valuation Allowance (30,445,627) (24,362,007) (19,413,888) Net Deferred Tax Assets $ — $ — $ — As of December 31, 2019, the Company has approximately $118 million in US federal net operating loss (NOL) carry-forwards, $129,000 in United Kingdom NOL carry-forwards, and $1.35 million of Japanese NOL carry-forwards. The federal and state NOL carry-forwards generated in tax years prior to 2018 will begin to expire in 2020. As a result of the Tax Cuts and Jobs Act of 2017, the federal NOL carry-forwards created in 2018 and 2019 have no expiration. The Company has state NOLs of approximately $3.4 million available in several jurisdictions in which it files that will begin to expire in 2034. The Company also has approximately $3.5 million of federal and state credit carry-forwards. The federal and state credit carry-forwards began to expire during 2018. Utilization of the NOL carry-forwards may be subject to an annual limitation in the case of sufficient equity ownership changes under Section 382 of the tax law or the NOL's may expire unutilized. As the result of the assessment of the FASB ASC 740-10, “Accounting for Uncertainty in Income Taxes — An Interpretation of FASB Statement No. 109”, the Company has no unrecognized tax benefits. The Company’s U.S. Federal and state tax matters for the years 2015 through 2018 remain subject to examination by the respective tax authorities. FASB ASC 740 requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are determined based on differing treatment of items for financial reporting and income tax reporting purposes. The deferred tax balances are adjusted to reflect tax rates by tax jurisdiction, based on currently enacted tax laws, which will be in effect in the years in which the temporary differences are expected to reverse. In light of the historic losses of the Company, a 100% valuation allowance has been recorded to fully offset any benefit associated with the net deferred tax assets, for which realization is not considered more likely than not to occur. |
Capital Stock
Capital Stock | 12 Months Ended |
Dec. 31, 2019 | |
Capital Stock | |
Capital Stock | Note 12 — Capital Stock Preferred stock The Board of Directors is authorized to establish and designate different series of preferred stock and to fix and determine the voting powers and other special rights and qualifications of such series. A total of 5,000,000 shares of preferred stock are authorized as of December 31, 2019 and December 31, 2018. There were 49,626 shares of Series A Preferred Stock issued and outstanding on December 31, 2019 and December 31, 2018. There were no declared preferred dividends owed as of December 31, 2019 or 2018. On January 2, 2015 (the “Series A Closing Date”), we entered into and closed a Series A Preferred Stock Purchase Agreement (the “Series A Purchase Agreement”) with Intel Corporation (the “Series A Purchaser”), pursuant to which we issued and sold to the Series A Purchaser, an aggregate of 49,626 shares of the Company’s Series A Preferred Stock, at a purchase price of $500 per share, for an aggregate purchase price of $24,813,000 (the “Series A Private Placement”). Each share of Series A Preferred Stock is convertible, at the option of the Series A Purchaser, into 100 shares of the Company’s common stock (determined by dividing the Series A Original Issue Price of $500 by the Series A Conversion Price). The Series A Conversion Price is $5.00, subject to adjustment in the event of stock splits, dividends or other combinations. Each share of Series A Preferred Stock is entitled to receive dividends at a rate of 6% per year, compounded quarterly and payable in cash or in kind, at the Company’s sole discretion. As of December 31, 2019, total accrued and unpaid preferred dividends were $8,601,092. In the event of the liquidation, dissolution or winding up of the Company, each share of Series A Preferred Stock is entitled to a liquidation preference equal to one times (1x) the Series A Purchaser’s original per share purchase price, plus a right to receive an additional liquidation distribution together with the common stock holders pro rata on an as-converted basis, but not in excess of $1,000 per share in the aggregate (subject to adjustment for accrued but unpaid dividends and in the event of stock splits, dividends or other combinations). Each share of Series A Preferred Stock is entitled to vote with the holders of the Company’s common stock on matters presented to its stockholders and is entitled to cast such number of votes equal to the whole number of shares of common stock into which such shares of Series A Preferred Stock are convertible. The holders of record of the Series A Preferred Stock are entitled to nominate and elect two directors to the Company’s Board of Directors (the “Board Election Right”), at least one of whom is required to qualify as an “independent” director, as that term is used in applicable exchange listing rules. The Board Election Right with respect to the independent director will terminate on such date as the number of shares of Series A Preferred Stock then outstanding is less than 40% of the original amount purchased by the Series A Purchaser. The Board Election Right with respect to the second director shall terminate on such date as the number of shares of Series A Preferred Stock then outstanding is less than 20% of the original amount purchased by the Series A Purchaser. The Company also granted the Series A Purchaser the right to have a board observer at meetings of the Company’s Board of Directors and committees thereof. To date, the Series A Purchaser has not exercised such director election or meeting observation rights. For as long as at least 25% (or 12,406 shares) of the Series A Preferred Stock is outstanding, the Company may not, without the consent of holders of at least 60% of the then outstanding shares of Series A Preferred Stock, take certain actions, including but not limited to: (i) liquidate, dissolve, or wind up the business and affairs of the Company; (ii) amend, alter or repeal any provision of its charter or bylaws in a manner that adversely effects the rights of the Series A Preferred Stock; (iii) create or issue any capital stock that is equal to or senior to the Series A Preferred Stock with respect to preferences; (iv) create or issue any debt security, subject to certain exceptions; (v) pay off any debt obligation prior to its stated maturity date; or (vi) enter into any stockholders rights plan or similar arrangement or take other actions that may limit actions that holders of a majority of the Series A Preferred Stock can take under Section 203 of the Delaware General Corporation Law, as well as such other customary provisions protecting the rights of the holder of the Series A Preferred Stock, as are outlined in the Certificate of Designation. The Series A Purchaser has the right to participate in any proposed issuance by the Company of its securities, subject to certain exceptions (the “Participation Right”). In the event the Series A Purchaser is not afforded the opportunity to exercise its Participation Right, the Series A Purchaser will have the right, but not the obligation, up to two times per calendar year, to acquire additional securities from the Company in such amount as is sufficient to maintain the Series A Purchaser’s ownership percentage in the Company, calculated immediately prior to such applicable financing, at a purchase price equal to the per share price of the Company’s securities in such applicable financing. In connection with the Series A Private Placement, the Company entered into an investor’s rights agreement with the Series A Purchaser, pursuant to which the Company agreed to file a “resale” registration statement with the Securities and Exchange Commission (the “SEC”) covering the resale of all shares of common stock issuable upon conversion of the Series A Preferred Stock sold in the Series A Private Placement on or before February 14, 2015. The Company filed the registration statement on February 12, 2015 and the registration statement was declared effective by the SEC on February 17, 2015. Common Stock The Company’s authorized common stock consists of 100,000,000 shares, par value of $0.001 as of December 31, 2019 and December 31, 2018. There were 33,128,620 and 27,591,670 shares of common stock issued and outstanding as of December 31, 2019 and December 31, 2018, respectively. On July 1, 2019, the Company entered into a securities purchase agreement with certain purchasers for the sale of an aggregate of 5,479,454 shares of the Company’s common stock along with warrants to purchase an aggregate of up to 5,479,454 additional shares of common stock, in a registered direct offering at a combined purchase price of $3.65 per share and warrant for aggregate gross sale proceeds of $20,000,007. The purchase agreement closed on July 2, 2019. The Company received net proceeds after issuance costs and expenses of $18,855,007. The warrants sold in the offering are exercisable for a period of two years commencing six months from the issuance date at an exercise price of $4.10 per share. On January 24, 2018, the Company entered into a securities purchase agreement with the purchasers set forth on the signature pages thereto for the purchase and sale of an aggregate of 3,000,000 shares of the Company’s common stock, along with warrants to purchase an aggregate of up to 1,200,000 shares of common stock, in a registered direct offering at a combined purchase price of $10.00 per share and 0.4 of a warrant, for an aggregate purchase price of $30,000,000. The warrants associated with this purchase agreement expired, unexercised, in January 2019. The purchase agreement closed on January 29, 2018. |
Stock Warrants
Stock Warrants | 12 Months Ended |
Dec. 31, 2019 | |
Stock Warrants | |
Stock Warrants | Note 13 — Stock Warrants The following table shows the various changes in warrants for the years ended: December 31, December 31, December 31, 2019 2018 2017 Warrants Outstanding, Beginning of Year 2,233,062 1,184,912 401,859 Exercised During the Year — (113,850) (250,009) Issued During the Year 5,479,454 1,200,000 1,033,062 Expired During the Year (1,200,000) (38,000) — Warrants Outstanding, End of Year 6,512,516 2,233,062 1,184,912 Of the outstanding warrants as of December 31, 2019, 1,033,062 expire on June 18, 2021 and the remainder expire on January 2, 2022. The weighted average remaining term of the warrants was 1.9 years. The weighted average exercise price was $4.56 per share. Of the outstanding warrants as of December 31, 2018, 1,200,000 expired on January 26, 2019 and the remainder expire on June 18, 2021. The weighted average remaining term of the warrants was 1.2 years. The weighted average exercise price was $8.61 per share. The outstanding warrants as of December 31, 2017 expire from March 21, 2018 to June 18, 2021. The weighted average remaining term of the warrants is 3.1 years. The weighted average exercise price is $6.44 per share. During the year ended December 31, 2019 there were no warrants exercised. During the year ended December 31, 2018, a total of 96,350 warrants were exercised on a cashless basis resulting in the issuance of 66,710 shares and a total of 17,500 warrants were exercised for cash resulting in the issuance of 17,500 shares and proceeds of $39,373. During the year ended December 31, 2017 a total of 250,009 warrants were exercised on a cashless basis resulting in the issuance of 168,203 shares. Management completed a derivative analysis on the 5,479,454 warrants issued in conjunction with our securities purchase agreement which closed on July 2, 2019 to determine whether or not they met the criteria under ASC 815‑10‑15‑83 to trigger treatment as a derivative instrument. Management concluded that these warrants did not meet the criteria to be treated as a derivative instrument. |
Stock Option Plans
Stock Option Plans | 12 Months Ended |
Dec. 31, 2019 | |
Stock Option Plans | |
Stock Option Plans | Note 14 — Stock Option Plans The Company has the following Stock Option Plans (“Plans”) that allow for the granting of both incentive stock options or ISOs, which can result in potentially favorable tax treatment to the participant, and non-statutory stock options. The Company’s 2014 Equity Incentive Plan (the “2014 Plan”) was approved by the stockholders of the Company on June 26, 2014. The Company no longer issues any options under its prior 2007 and 2009 Plans. The 2014 Plan has an “evergreen provision”, under which the maximum number of shares of common stock that may be issued under the 2014 Plan was initially 1,000,000 and automatically increases each time the Company issues additional shares of common stock so that, initially, the total number of shares issuable thereunder at all times would be equal to 10% of the then outstanding shares of common stock. On June 13, 2018, the Company’s stockholders approved an amendment to the Company’s 2014 Equity Incentive Plan to increase the number of shares available for issuance thereunder to 20% of the outstanding shares of common stock. As of December 31, 2019, the authorized shares of common stock under the 2014 Plan, as amended, totaled 6,712,290. The exercise price per share subject to an option is determined by the administrator, but in the case of an ISO must not be less than the fair market value of a share of our common stock on the date of grant and in the case of a non-statutory stock option must not be less than 100% of the fair market value of a share of our common stock on the date of grant. Under the 2014 Plan, the Company may grant stock options, stock appreciation rights, performance awards of stock and/or cash, and stock awards of restricted stock. Options outstanding under the Stock Options Plans are as follows: 2007 2009 2014 Plan Plan Plan Total Outstanding as of December 31, 2017 10,665 117,094 1,382,485 1,510,244 Available for future issuance under plan — — 1,045,143 1,045,143 Total authorized by plan 10,665 117,094 2,427,628 2,555,387 Outstanding as of December 31, 2018 — 110,771 1,435,750 1,546,521 Available for future issuance under plan — — 4,082,584 4,082,584 Totals authorized by plan — 110,771 5,518,334 5,629,105 Outstanding as of December 31, 2019 — 85,498 1,298,093 1,383,591 Available for future issuance under plan — — 5,329,309 5,329,309 Totals authorized by plan — 85,498 6,627,402 6,712,900 The 2014 Plan gives the Board of Directors of the Company the ability to determine vesting periods for all stock incentives granted under the 2014 Plan and allows option terms to be up to ten years from the original grant date. Employees’ incentive stock options must vest at a minimum rate of 20% per year over a five-year period, commencing on the date of grant. Most vest ratably over four years commencing on the date of the option grant. In the case of directors, such options are granted annually and expire ten years after the date of their grant and vest ratably, on a monthly basis, over the next 12 months. Non-employee directors generally have vesting on a monthly basis, over the next 12 months. Advisors or consultants can have vesting range from 100% of the option grants vesting immediately to ratably, on a monthly basis, up to 48 months. The following table summarizes stock option activity for the years ended December 31, 2019, 2018 and 2017: Weighted Weighted Average Number of Average Remaining Life Options Exercise Price (years) Outstanding at December 31, 2016 1,084,298 $ 4.76 7.57 Granted 534,500 5.74 Exercised (63,187) 2.89 Expired or Forfeited (45,367) 8.30 Outstanding at December 31, 2017 1,510,244 $ 5.04 7.58 Granted 330,500 5.81 Exercised (97,264) 4.96 Expired or Forfeited (196,959) 6.11 Outstanding at December 31, 2018 1,546,521 $ 5.11 7.19 Granted 73,500 2.36 Exercised — — Expired or Forfeited (236,430) 6.21 Outstanding at December 31, 2019 1,383,591 $ 4.77 As of December 31, 2019, there were 1,015,019 options that were fully vested and exercisable at a weighted average exercise price of $4.63 per share. The weighted average remaining contractual term on the vested options is 5.44 years. The unvested balance of 368,572 options as of December 31, 2019 were exercisable at a weighted average exercise price of $5.17 per share. The weighted average remaining contractual term on the vested options was 8.5 years. As of December 31, 2018, there were 936,406 options that were fully vested and exercisable at a weighted average exercise price of $4.66 per share. The weighted average remaining contractual term on the vested options is 6.1 years. The unvested balance of 610,115 options as of December 31, 2018 were exercisable at a weighted average exercise price of $5.80 per share. The weighted average remaining contractual term on the vested options was 8.9 years. As of December 31, 2017, there were 797,861 options that were fully vested and exercisable at a weighted average exercise price of $4.65 per share. The weighted average remaining contractual term on the vested options is 6.4 years. The unvested balance of 712,383 options as of December 31, 2017 are exercisable at a weighted average exercise price of $5.48 per share. The weighted average remaining contractual term on the unvested options is 8.7 years. The aggregate intrinsic value of the options outstanding as of December 31, 2019, 2018 and 2017 was approximately nil, $912,360 and $2,323,312, respectively. The Black-Scholes-Merton option pricing model was used to estimate the fair value of share-based awards under FASB ASC Topic 718. The Black-Scholes-Merton option pricing model incorporates various and highly subjective assumptions, including expected term and share price volatility. For valuation purposes, stock option awards were categorized into two groups, stock option grants to employees and stock option grants to members of the Board of Directors. The expected term of options granted was estimated to be the average of the vesting term, historical exercise and forfeiture rates, and the contractual life of the option. The share price volatility at the grant date is estimated using historical stock prices based upon the expected term of the options granted. The risk-free interest rate assumption is determined using the rates for U.S. Treasury zero-coupon bonds with maturities similar to those of the expected term of the award being valued. We have never paid cash dividends on our common stock and do not anticipate paying cash dividends on our common stock in the foreseeable future. Therefore, the assumed expected dividend yield is zero. The following summary table shows the assumptions used to compute the fair value of stock options granted during 2019, 2018 and 2017 and their estimated value: December 31, 2019 2018 2017 Assumptions for Black-Scholes: Expected term in years 6.2 to 6.3 6.4 to 6.6 6.5 to 6.8 Volatility 79.4% to 89.4 % 108.9% to 119.4 % 122.8% to 133.0 % Risk-free interest rate 1.63% to 1.68 % 2.95% to 3.08 % 1.98% to 2.30 % Expected annual dividends None None None Value of options granted: Number of options granted 73,500 330,500 534,500 Weighted average fair value per share $ 1.71 $ 5.01 $ 5.24 Fair value of options granted $ 125,814 $ 1,655,390 $ 2,803,329 Under FASB ASC Topic 718, the Company has elected to account for forfeitures as they occur. Stock-based compensation expense is recorded only for those awards expected to vest using an estimated forfeiture rate based on historical pre-vesting forfeiture data. Unrecognized stock-based compensation expense was $1,616,503 as of December 31, 2019, relating to a total of 368,572 unvested stock options under the Company’s stock option plans. This stock-based compensation expense is expected to be recognized over a weighted average period of approximately 2.3 years. |
Right-of-Use Assets and Liabili
Right-of-Use Assets and Liabilities | 12 Months Ended |
Dec. 31, 2019 | |
Right-of-Use Assets and Liabilities | |
Right-of-Use Assets and Liabilities | Note 15 — Right-of-Use Assets and Liabilities On January 1, 2019, the Company adopted FASB ASU 2016-02, Leases (Topic 842). ASU 2016-02 requires lessees to recognize a right-of-use asset and lease liability in the balance sheet for all leases, including operating leases, with terms of more than twelve months. Upon adoption, we recognized an Operating Lease Right-of-Use Asset of $994,000, a current Operating Lease Liability of $533,000 and a long-term Operating Lease Liability of $461,000. We applied Topic 842 to all leases as of January 1, 2019 with comparable periods continuing to be reported under Topic 840. Upon adoption, we elected: (i) the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allowed us to carry forward the historical lease classification and (ii) the practical expedient which allows us not to separate non-lease components from lease components, as they are not considered the predominate components in our contracts. The adoption of this standard does not have a significant impact on our consolidated results of operations or cash flows. The Company has signed several lease agreements, with the largest being for its office and manufacturing facility in the Rochester, New York area under an operating lease that commenced October 3, 2015 and expires on October 3, 2020. This lease has an original five-year term with an option by the Company to renew for two additional three-year terms at pre-agreed to lease rates. As of January 2020, we have given formal notice of our intent to exercise the first of two renewal terms, extending our current lease expiration date to October 3, 2023. This renewal term is included in our right-to-use asset and liability as of December 31, 2019 as the renewal option for our current leased facility is reasonably certain. Operating lease costs under the operating leases totaled $572,767, $462,711 and $461,246 for the years ended December 31, 2019, 2018 and 2017, respectively. Certain leases provide for increases in future minimum annual rental payments as defined in the lease agreements. The leases generally also include real estate taxes and common area maintenance charges in the annual rental payments. Short-term leases are leases having a term of twelve (12) months or less. The Company recognizes short-term leases on a straight-line basis and does not record a related lease asset or liability for such leases. As none of our leases provide an implicit interest rate, we use our incremental borrowing rate to determine our discount rate at lease inception based upon the information available at commencement in determining the present value of lease payments. As of December 31, 2019, the weighted average discount rate was 4.5% and the weighted average remaining lease term was 3.7 years. Future lease payments under operating leases as of December 31, 2019 were as follows: 2020 $ 608,698 2021 599,190 2022 587,286 2023 489,405 Total Future Lease Payments 2,284,579 Less: Imputed Interest (188,389) Total Lease Liability Balance $ 2,096,190 |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2019 | |
Employee Benefit Plans | |
Employee Benefit Plans | Note 16 — Employee Benefit Plans The Company has a Section 401(k) Savings Plan which covers employees who meet certain age and length of service requirements. Effective July 1, 2018, the Company’s Plan was amended to include a 100% match by the Company on all eligible employee salary deferrals. The Company’s matching contribution is limited to 3% of covered employee’s annual salary. Total 401(k) matching expense for the years ended December 31, 2019, 2018 and 2017 totaled $142,414, $100,188 and $0, respectively. |
Litigation
Litigation | 12 Months Ended |
Dec. 31, 2019 | |
Litigation | |
Litigation | Note 17 — Litigation We are not currently involved in any actual or pending material legal proceedings or litigation, and we are not aware of any such proceedings contemplated by or against us or our property, except as follows: On or about December 16, 2019, Throop, LLC (“Throop”) filed a patent infringement lawsuit in the United States District Court for the Central District of California against the Company. The complaint alleges that certain Vuzix products (which have yet to be sufficiently identified) infringe claims of U.S. Patent No. 7,035,897 and U.S. Patent No. 9,479,726. Both patents expired on January 14, 2020. The complaint purports to seek an injunction or payment of an ongoing royalty with respect to the patents, an award of damages to compensate for alleged past infringement, trebled damages, and an award of costs and attorney’s fees. On March 6, 2020, before the Company filed a formal response to the complaint with the Court, Throop filed a voluntary dismissal without prejudice of the California complaint in response to the Company’s position that venue was improper. The Company denies that Throop is entitled to the relief requested and intends to vigorously defend itself against the claims asserted and any lawsuit related thereto brought against the Company going forward. We were involved in the following litigation matters in 2019, which have been resolved: On April 5, 2018, we filed a defamation lawsuit against Ricardo Antonio Pearson (a\k\a Richard Pearson) in the Supreme Court of the State of New York, County of New York. The Company’s complaint against Mr. Pearson alleged that he published false and defamatory articles about the Company. Vuzix sought damages in excess of $80 million, including punitive damages, and money damages. The lawsuit was moved from New York State Supreme Court, New York County, to the United States District Court, Southern District of New York, and Mr. Pearson filed a motion to dismiss the complaint for lack of jurisdiction, among other grounds. On or about November 8, 2019, the Court granted Mr. Pearson’s motion and dismissed the lawsuit on the basis that it lacked personal jurisdiction over him. In its decision, the Court noted that it was not making a determination or ruling on the actual merits of the lawsuit. On or about October 27, 2018, Bob Glenn filed a shareholder derivative suit in the Supreme Court of the State of New York, County of Monroe against certain of the Company’s current and former directors and executive officers. The Company was named as a nominal defendant only. The complaint alleged breaches of fiduciary duty, unjust enrichment, and waste of corporate assets. The complaint also alleged that the Company and certain of its officers and directors made materially false and/or misleading statements and failed to disclose material adverse events about the Company’s business, operations and prospects in press releases and public filings. The complaint sought a declaration that the defendants breached and/or aided and abetted the breach of their fiduciary duties to the Company, determining and awarding damages, and directing the Company to reform and improve its corporate governance. Similar derivative suits were filed by Michael Washington and John Mayer on or about October 26, 2018 and October 29, 2018, and pursuant to the parties’ stipulation, the Court ordered the three lawsuits to be consolidated on January 29, 2019. Because the Company believed the allegations to be false and without merit, it filed a motion to dismiss the consolidated complaints on September 6, 2019. In response to the motion, the plaintiffs filed a consolidated amended complaint on October 3, 2019 in an attempt to bolster their allegations, but the causes of action remained substantially similar to those asserted in the original complaints. Because the Company found the claims in the consolidated amended complaint also to be baseless, it filed a motion to dismiss that pleading as well on November 4, 2019. Electing not to respond to the motion, the plaintiffs chose, instead, to voluntarily discontinue the action against the Company, and filed a stipulation to that effect with the Court on December 10, 2019. Accordingly, the Court marked the case disposed. |
Geographic and Other Financial
Geographic and Other Financial Information (Unaudited) | 12 Months Ended |
Dec. 31, 2019 | |
Geographic and Other Financial Information (Unaudited) | |
Geographic and Other Financial Information (Unaudited) | Note 18 — Geographic and Other Financial Information (Unaudited) Geographic Financial Information (Unaudited) Geographical revenue information, based on ship-to destination of the customers for the three years ended December 31, 2019, 2018 and 2017 is as follows (in thousands): By Continent and Region: Fiscal Year 2019 2018 2017 Revenue % of Total Revenue % of Total Revenue % of Total North America $ 2,781 42 % $ 3,550 44 % $ 1,687 30 % Asia-Pacific 2,058 31 % 2,248 28 % 1,927 35 % Europe 1,656 25 % 2,183 27 % 1,892 34 % Others 176 2 % 113 1 % 32 1 % Total Revenues $ 6,671 100 % $ 8,094 100 % $ 5,538 100 % By Country: Fiscal Year 2019 2018 2017 Revenue % of Total Revenue % of Total Revenue % of Total US $ 2,673 40 % $ 3,475 43 % $ 1,618 29 % China 984 15 % 17 0 % — 0 % Japan 873 13 % 1,261 16 % 1,340 24 % Germany 778 12 % 492 6 % 526 9 % Others 1,363 20 % 2,849 35 % 2,054 38 % Total Revenues $ 6,671 100 % $ 8,094 100 % $ 5,538 100 % The Company does not maintain significant amounts of long-lived assets outside of the United States. |
Quarterly Financial Information
Quarterly Financial Information (Unaudited) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information (Unaudited) | |
Quarterly Financial Information (Unaudited) | Note 19 — Quarterly Financial Information (Unaudited) The following table summarizes our unaudited quarterly financial information for the periods shown below (in thousands, except per share data): Fiscal Year 2019 December 31, September 30, June 30, March 31, Revenue $ 1,953 $ 1,159 $ 2,186 $ 1,373 Gross profit (loss) (4,369) (231) 152 40 Net loss (9,583) (5,477) (5,056) (6,360) Net loss per share, basic and diluted (0.31) (0.18) (0.20) (0.25) Net loss attributable to common stockholders (10,081) (5,967) (5,534) (6,826) Fiscal Year 2018 December 31, September 30, June 30, March 31, Revenue $ 1,979 $ 1,923 $ 2,648 $ 1,544 Gross profit (loss) 300 621 670 177 Net loss (5,564) (4,798) (6,148) (5,366) Net loss per share, basic and diluted (0.22) (0.19) (0.24) (0.22) Net loss attributable to common stockholders (6,033) (5,260) (6,599) (5,804) |
Schedule II -Valuation And Qual
Schedule II -Valuation And Qualification Accounts | 12 Months Ended |
Dec. 31, 2019 | |
Valuation and Qualifying Accounts | |
Schedule II - Valuation and Qualifying Accounts | VUZIX CORPORATION Schedule II — Valuation and Qualifying Accounts (in thousands) Balance at Beginning of Charged to Balance at End Description Period Expenses Deductions of Period For the Year Ended December 31, 2017 Allowances deducted from assets Doubtful Accounts $ — $ 29 $ — $ 29 Inventory 624 212 (a) — 836 Total allowances deducted from assets $ 624 $ 241 $ — $ 865 For the Year Ended December 31, 2018 Allowances deducted from assets Doubtful Accounts $ 29 $ 7 $ (29) $ 7 Inventory 836 303 (775) (b) 364 Total allowances deducted from assets $ 865 $ 310 $ (804) $ 371 For the Year Ended December 31, 2019 Allowances deducted from assets Doubtful Accounts $ 7 $ (7) (c) $ — $ — Inventory 364 4,573 (149) 4,788 Total allowances deducted from assets $ 371 $ 4,566 $ (149) $ 4,788 (a) Net change in inventory allowance, excluding iWear net realizable value write-down. (b) Deductions in 2018 primarily related to the disposal of raw components related to the discontinuance of our iWear product. (c) Recovery of amounts previously written off. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Significant Accounting Policies | |
Operations | Operations Vuzix Corporation (the Company) was formed in 1997 under the laws of the State of Delaware and maintains its corporate offices in Rochester, New York. We are engaged in the design, manufacture, marketing and sale of augmented reality wearable display and computing devices also referred to as head mounted displays (or HMDs, but also known as near-eye displays), in the form of Smart Glasses and Augmented Reality (AR) glasses. Our AR wearable display devices are worn like eyeglasses or attach to a head worn mount. These devices typically include cameras, sensors, and a computer that enable the user to view, record and interact with video and digital content, such as computer data, the Internet, social media or entertainment applications. Our wearable display products integrate micro-display technology with our advanced optics to produce compact high-resolution display engines, less than half an inch diagonally, which when viewed through our smart glasses products create virtual images that appear comparable in size to that of a computer monitor or a large-screen television. The wearable display products we produce can be used for a variety of enterprise and commercial users and applications, including AR for on-the-go users and as mobile displays for entertainment and social media use. Our products are available with varying features and are offered as monocular display systems. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, Vuzix Europe Limited. All significant inter-company transactions have been eliminated. Certain prior year amounts have been reclassified to be consistent with current year presentation. |
Segment Data, Geographic Information and Significant Customers | Segment Data, Geographic Information and Significant Customers The Company is not organized by market and is managed and operated as one business. A single management team that reports to the chief operating decision maker comprehensively manages the entire business. The Company does not operate any material separate lines of business or separate business entities. Accordingly, the Company does not accumulate discrete information, other than product revenue and material costs, with respect to separate product lines and does not have separately reportable segments as defined by FASB ASC Topic 280, “Disclosures about Segments of an Enterprise and Related Information”. Refer to Note 18 — Geographic and Other Financial Information (Unaudited). |
Foreign Currency Transactions | Foreign Currency Transactions The Company considers the US dollar as the functional currency of the Company’s UK Subsidiary. The Company’s UK Subsidiary transacts in Euros and British pounds. All transactions in foreign currencies are recorded in US dollars at the then current exchange rate(s). Upon settlement of the underlying transaction, all amounts are re-measured to US dollars at the current exchange rate on date of settlement. All unsettled foreign currency transactions that remain in accounts receivable and trade account payables are re-measured to US dollars at the period end exchange rates. All re-measurement gains and losses are recorded in the current period net income. |
Use of Estimates | Use of Estimates The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at year-end and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. |
Concentration of Credit Risk | Concentration of Credit Risk The Company maintains its cash in bank deposit accounts, which at times may exceed federally insured limits. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents can include highly liquid investments with original maturities of three months or less. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company’s financial instruments primarily consist of cash and cash equivalents, accounts receivable, notes receivable, accounts payable, customer deposits, accrued expenses, and income taxes payable. As of the consolidated balance sheet dates, the estimated fair values of the financial instruments were not materially different from their carrying values as presented due to the short maturities of these instruments. |
Accounts Receivable | Accounts Receivable The Company carries its trade accounts receivable at invoice amount less an allowance for doubtful accounts. The Company establishes an allowance for uncollectible trade accounts receivable based on the age of outstanding invoices and management’s evaluation of collectability of outstanding balances. These provisions are established when the aging of outstanding amounts exceeds allowable terms and are re-evaluated at each quarter end for adequacy. In determining the adequacy of the provision, the Company considers known uncollectible or at-risk receivables. The allowance for doubtful accounts as of December 31, 2019 and 2018 was nil and $7,280, respectively. The Company does not accrue interest on any past due accounts receivable unless such receivable goes into collection. |
Notes Receivable | Notes Receivable On December 17, 2019, the Company provided a one-year convertible promissory note to a confidential strategic business partner for $250,000. The note carries an interest rate of 8%, compounded monthly. The principal and accrued interest become due and payable to the Company on November 15, 2020. The note contains mandatory and automatic conversions of principal and accrued interest into equity upon on the occurrence of a triggering event at a pre-defined conversion price range. The pre-defined conversion price range if triggered, would result in the Company owning 1 to 2.5% of this entity. |
Customer Concentrations | Customer Concentrations Foxconn Technology Group, or Foxconn (f/k/a Toshiba Japan) represented 16% of total product revenue and one confidential defense customer represented 100% of engineering services revenue for the year ended December 31, 2019. Foxconn, SATS Airport Services Pte Ltd and AMA SA represented 17%, 10% and 10% of our total revenues in 2018, respectively. Foxconn represented 18% of our total revenue in 2017. Ubimax GmbH, Foxconn and a confidential defense customer represented 32%, 26% and 13%, respectively, of accounts receivable at December 31, 2019. Foxconn and SATS represented 32% and 38%, respectively, of accounts receivable at December 31, 2018. Foxconn represented 25% of accounts receivable and 100% of accrued project revenues at December 31, 2017. |
Accrued Project Revenue | Accrued Project Revenue The Company carries accrued project revenue based on the percentage of completion on the project measured using the input method based upon costs incurred to-date as a percentage of total expected costs to complete the project less amounts invoiced, if any. As of December 31, 2019 and 2018, we had nil in accrued project revenue. |
Inventories | Inventories Inventories are valued at the lower of cost or net realizable value using the weighted average first-in, first-out method. The Company includes labor and overhead costs in its inventory valuation costing. The Company records provisions for excess, obsolete or slow-moving inventory based on changes in customer demand, technology developments or other economic factors. The Company’s products have product life cycles that range on average from two to three years currently. At both the product introduction and product discontinuation stage, there is a higher degree of risk of inventory obsolescence. The provision for obsolete and excess inventory is evaluated for adequacy at each quarter end. The estimate of the provision for obsolete and excess inventory is partially based on expected future product sales, which are difficult to forecast for certain products. |
Revenue Recognition | Revenue Recognition The Company adopted the new guidance on Revenue from Contracts with Customers under FASB ASC Topic 606, "Revenue from Contracts with Customers", as of January 1, 2018. Refer to Note 2 for further discussion on the impact of this adoption. Product sales represent the majority of the Company’s revenue. The Company recognizes revenue from these product sales as performance obligations are satisfied and transfer of control and ownership to the customer has occurred, typically upon physical shipment. Revenue is recognized in the amount that the Company expects to receive in exchange from the sale of our products. FOB shipping point is our standard shipping terms and revenue is recognized as our products ship to customers, as control and ownership are transferred at this point in time. All of our standard products sales include a 30‑day money back guarantee and expected returns are estimated at each reporting period date and a portion of revenue is deferred for all estimated returns. As of December 31, 2019, deferred revenue associated with our expected returns was immaterial. The Company collects and remits sales taxes in certain jurisdictions and reports revenue net of any associated sales taxes. Revenue from any engineering consulting and other services is recognized at the time the services are rendered. The Company accounts for its longer-term development contracts, which to date have all been firm fixed-priced contracts, on the percentage-of-completion method, whereby income is recognized as work on contracts progresses, but estimated losses on contracts in progress are charged to operations immediately. The percentage-of-completion is determined using the cost-to-cost method. To date, all such contracts have been less than one calendar year in duration. |
Unearned Revenue | Unearned Revenue These amounts represent deferred revenue against unfulfilled performance obligations such as extended product warranty sales and sales of our Vuzix Basic Video applications, which are amortized over a twelve (12) month period. |
Customer Deposits | Customer Deposits Customer deposits represent money the Company has received in advance of providing a product or engineering services to a customer. All such deposits are short term in nature as the Company typically delivers the product or engineering services provided to the customer within one year. These deposits are credited to the customer against product deliveries or at the completion of the customer’s order. As of December 31, 2019 and 2018, we had nil and $152,362 in outstanding customer deposits. |
Cost of Product Revenues | Cost of Product Revenues Cost of product revenue includes the direct and allocated indirect costs of products sold to customers. Direct costs include labor, materials, reserves for estimated warranty expenses, and other costs incurred directly, or charged to us by our contract manufacturers in the manufacture of these products. Indirect costs include labor, manufacturing overhead, and other costs associated with operating our manufacturing facility and capacity. Manufacturing overhead includes the costs of procuring, inspecting and storing material, facility and other costs, and is allocated to cost of product revenue based on the proportion of indirect labor which supported production activities. Depreciation on manufacturing tools and equipment is included in Operating Expenses in our consolidated statement of operations. The cost of product revenue can fluctuate significantly from period to period, depending on the product mix and volume, the level of manufacturing overhead expense and the volume of direct material purchased. |
Cost of Engineering Services Revenues | Cost of Engineering Services Revenues Cost of engineering services revenues includes both the direct and allocated indirect costs of performing on contracts and producing prototype units. Direct costs include labor, materials and other costs incurred directly in performing under the contract. Direct costs also include labor and other costs associated with operating our research and development department based on the level of effort supporting the development activity. Cost of contract revenue is determined by the level of direct and indirect costs incurred, which can fluctuate substantially from period to period. |
Fixed Assets | Fixed Assets Fixed assets are stated at cost. Depreciation of fixed assets is provided for using the straight-line method over the following estimated useful lives: Computers and Purchased Software 3 years Leasehold Improvements Lesser of expected life or lease term Manufacturing Equipment 5 years Tooling 3 years Furniture and Equipment 5 years Repairs and maintenance costs are expensed as incurred. Asset betterments are capitalized and depreciated over their expected useful life. |
Patents and Trademarks | Patents and Trademarks The Company capitalizes the costs of obtaining its patents and registration of trademarks. Such costs are accumulated and capitalized during the filing periods, which can take several years to complete. Successful applications that result in the granting of a patent or trademark are then amortized over 15 years on a straight-line basis. Unsuccessful applications are written off and expensed in the fiscal period where the application is abandoned or discontinued. |
Software Development Costs | Software Development Costs The Company capitalizes the costs of obtaining or developing its software once technological feasibility has been determined by management. Such costs are accumulated and capitalized. Projects can take several years to complete. Unsuccessful or discontinued software projects are written off and expensed in the fiscal period when the software development effort is abandoned or discontinued. Costs incurred internally in researching and developing a computer software product are charged to expense until technological feasibility has been established for the product. Once technological feasibility is established, all software costs are capitalized until the product is available for general release to customers. Judgment is required in determining when technological feasibility of a product is established. Once the product is available for general release, accumulated costs are amortized over the life of the asset. The amortization of these costs is included in cost of revenue over the estimated life of the products, which currently is estimated as three years using a straight-line basis. As of December 31, 2019, we had $100,000 of net software development costs included in Other Assets. For the years ended December 31, 2019 and 2018, there was nil and $196,223, respectively in software impairment costs. |
Licenses | Licenses The Company capitalizes the costs of acquiring licenses and prepaid royalties. They are amortized on either a per unit basis or straight line over the life of the license. In some cases, future royalties are subject to annual limits. |
Long-Lived Assets | Long-Lived Assets The Company at least annually assesses all of its long-lived assets for impairment when events or circumstances indicate their carrying amounts may not be recoverable, in accordance with FASB ASC Topic 360‑10, “Accounting for the Impairment or Disposal of Long-Lived Assets.” There was no impairment charge in 2019, 2018 and 2017. |
Research and Development | Research and Development Research and development costs are expensed as incurred consistent with the guidance of FASB ASC Topic 730, “Research and Development,” and include employee related costs, office expenses, third-party design and engineering services, and new product prototyping costs. Costs incurred internally in researching and developing a computer software product are charged to expense until technological feasibility has been established for the product. |
Shipping and Handling Costs | Shipping and Handling Costs Amounts charged to customers and costs incurred by the Company related to shipping and handling are included in net sales and cost of sales, respectively. |
Provision for Future Warranty Costs | Provision for Future Warranty Costs The Company provides for the estimated returns under warranty and the costs of fulfilling our obligations under product warranties at the time the related revenue is recognized. The Company estimates the costs based on historical and projected product failure rates, historical and projected repair costs, and knowledge of specific product failures (if any). The specific warranty terms and conditions vary depending upon the country in which we do business, but generally include parts and labor over a period generally ranging from one to two years from the date of product shipment. The Company provides a reserve for expected future warranty returns at the time of product shipment or produces over-builds to cover replacements. We regularly reevaluate our estimates to assess the adequacy of the recorded warranty liabilities and adjust the amounts as necessary each quarter end, based on historical experience of warranty claims and costs. |
Advertising | Advertising Advertising costs are expensed as incurred and recorded in “Selling and Marketing” in the Consolidated Statements of Operations. Advertising expense for the years ended December 31, 2019, 2018 and 2017 was $1,302,120, $1,631,161 and $1,386,977, respectively. |
Income Taxes | Income Taxes The Company accounts for income taxes in accordance with FASB ASC Topic 740‑10, “Income Taxes.” Accordingly, the Company provides deferred income tax assets and liabilities based on the estimated future tax effects of differences between the financial and tax bases of assets and liabilities based on currently enacted tax laws. A valuation allowance is established for deferred tax assets in amounts for which realization is not considered more likely than not to occur. The Company reports any interest and penalties accrued relating to uncertain income tax positions as a component of the income tax provision. |
Net Loss Per Share | Net Loss Per Share Basic earnings per share is computed by dividing the net income (loss) less accrued dividends on any outstanding preferred stock by the weighted average number of common shares outstanding for the period. Diluted earnings per share calculations reflect the assumed exercise of all dilutive employee stock options and warrants applying the treasury stock method promulgated by FASB ASC Topic 260, “Earnings Per Share” and the conversion of any outstanding convertible preferred shares or notes payable that are-in-the-money, applying the as-if-converted method. However, if the assumed exercise of stock options and warrants and the conversion of any preferred shares or convertible notes payable are anti-dilutive, basic and diluted earnings per share are the same for all periods. As a result of the net losses generated in 2019, 2018 and 2017, all outstanding instruments would be antidilutive. As of December 31, 2019, 2018 and 2017, there were 12,858,707, 8,742,183 and 7,657,756 common stock share equivalents, respectively, that were potentially issuable under convertible debt agreements, options, conversion of preferred shares (excluding accrued dividends), and warrants that could potentially dilute basic earnings per share in the future. |
Stock-Based Compensation Expense | Stock-Based Compensation Expense The Company accounts for stock-based compensation to employees and directors in accordance with FASB ASC Topic 718 “Compensation - Stock Compensation,” which requires that compensation expense be recognized in the consolidated financial statements for stock-based awards based on the grant date fair value. For stock option awards, the Black-Scholes-Merton option pricing model was used to estimate the fair value of share-based awards under FASB ASC Topic 718. The Black-Scholes-Merton option pricing model incorporates various and highly subjective assumptions, including expected term and share price volatility. The expected term of options granted was estimated to be the average of the vesting term, historical exercise and forfeiture rates, and the contractual life of the option. The share price volatility at the grant date is estimated using historical stock prices based upon the expected term of the options granted. The risk-free interest rate assumption is determined using the rates for U.S. Treasury zero-coupon bonds with maturities similar to those of the expected term of the award being valued. For common stock awards, the Company uses the fair market value of our common stock on the date of each stock-based award based on the market price of the Company’s common shares and the expense related to these awards is recognized over the requisite service period of the awards on a straight-line or graded vesting basis, which is generally commensurate with the vesting term. Stock-based compensation expense associated with stock awards and stock option grants for the years ended December 31, 2019, 2018 and 2017 was $1,498,357, $2,197,481 and $1,623,272, respectively. The Company issues new shares upon stock option exercises. |
Leases | Leases The Company determines if an arrangement is a lease at inception. Our lease agreements generally contain lease and non-lease components. Historically, non-lease components such as utilities have been immaterial. Payments under our lease arrangements are primarily fixed. Lease assets and liabilities are recognized at the present value of the future lease payments at the lease commencement date. The interest rate used to determine the present value of the future lease payments is our incremental borrowing rate, because the interest rate implicit in our leases is not readily determinable. Our incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments, and in economic environments where the leased asset is located. Our lease terms include periods under options to extend or terminate the lease when it is reasonably certain that we will exercise that option. As of December 31, 2019, all of our leases are considered operating leases. Operating right of use assets and liabilities are included on our Consolidated Balance Sheets beginning January 1, 2019. The Company does not have any finance leases as of December 31, 2019. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (the “FASB”) issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326). ASU 2016-13 provides for a new impairment model which requires measurement and recognition of expected credit losses for most financial assets and certain other instruments, including but not limited to accounts receivable. ASU 2016-13 will become effective for the Company on January 1, 2023 and early adoption is permitted. The Company does not anticipate the adoption of this standard will have a material impact on our consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Significant Accounting Policies | |
Schedule of Property and Equipment Estimated Useful Life | Fixed assets are stated at cost. Depreciation of fixed assets is provided for using the straight-line method over the following estimated useful lives: Computers and Purchased Software 3 years Leasehold Improvements Lesser of expected life or lease term Manufacturing Equipment 5 years Tooling 3 years Furniture and Equipment 5 years |
Revenue Recognition and Contr_2
Revenue Recognition and Contracts with Customers (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Revenue Recognition and Contracts with Customers | |
Schedule of company's total revenue by major product lines | The following table summarizes the revenue recognized by major product line: For the Years Ended December 31, 2019 2018 2017 Revenues Smart Glasses and iWear Video Headphones Sales $ 4,893,384 $ 6,512,202 $ 4,197,633 OEM Product Sales 951,570 994,500 — Waveguide and Display Engine Sales 152,499 185,400 351,056 Engineering Services 673,151 402,266 989,064 Total Revenue $ 6,670,604 $ 8,094,368 $ 5,537,753 |
Schedule of company's net sales by revenue recognition method as a percentage of total net sales | The following table presents a summary of the Company’s net sales by revenue recognition method as a percentage of total net sales for the year ended December 31, 2019: % of Total Net Sales Point-in-Time – Output Method 90 % Over Time – Input Method 10 % Total 100 % |
Inventories, Net (Tables)
Inventories, Net (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Inventories, Net | |
Schedule of Inventories | Inventories consisted of the following: December 31, December 31, 2019 2018 Purchased Parts and Components $ 5,985,214 $ 3,284,848 Work in Process 2,414,142 1,523,616 Finished Goods 2,096,744 2,837,183 Less: Reserve for Obsolescence (4,788,233) (363,845) Inventories, Net $ 5,707,867 $ 7,281,802 |
Fixed Assets, Net (Tables)
Fixed Assets, Net (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fixed Assets, Net | |
Fixed Assets, Net | Fixed Assets consisted of the following: December 31, December 31, 2019 2018 Tooling and Manufacturing Equipment $ 5,262,080 $ 4,199,309 Leaseholds 773,734 487,957 Computers and Purchased Software 824,965 937,946 Furniture and Equipment 2,043,355 1,721,963 8,904,134 7,347,175 Less: Accumulated Depreciation (4,576,458) (3,055,485) Fixed Assets, Net $ 4,327,676 $ 4,291,690 |
Patents and Trademarks, Net (Ta
Patents and Trademarks, Net (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Patents and Trademarks [Member] | |
Schedule of Finite-Lived Intangible Assets | December 31, December 31, 2019 2018 Patents and Trademarks $ 2,020,070 $ 1,769,767 Less: Accumulated Amortization (725,395) (605,224) Patents and Trademarks, Net $ 1,294,675 $ 1,164,543 |
Licenses, Net (Tables)
Licenses, Net (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Licenses [Member] | |
Schedule of Finite-Lived Intangible Assets | December 31, December 31, 2019 2018 Licenses $ 493,717 $ 493,717 Less: Accumulated Amortization (179,301) (56,597) Licenses, Net $ 314,416 $ 437,120 |
Intangible Asset, Net (Tables)
Intangible Asset, Net (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Intangible Assets [Member] | |
Schedule of Finite-Lived Intangible Assets | December 31, December 31, 2019 2018 Intangible Asset $ 1,500,000 $ 1,500,000 Less: Accumulated Amortization (510,000) (102,000) Intangible Asset, Net $ 990,000 $ 1,398,000 |
Other Assets (Tables)
Other Assets (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Other Assets | |
Schedule of other assets | The Company’s other assets consists of the following: December 31, December 31, 2019 2018 Other $ — $ 9,192 Private Corporation Investment 250,000 250,000 Total Other Assets, Non-Amortizing 250,000 259,192 Software Development Costs 300,000 496,223 Less: Accumulated Amortization (200,000) (100,000) Less: Impairment — (196,223) Software Development Costs, Net 100,000 200,000 Total Other Assets $ 350,000 $ 459,192 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accrued Expenses | |
Schedule of Accrued Expenses | Accrued expenses consisted of the following: December 31, December 31, 2019 2018 Accrued Wages and Related Costs $ 394,669 $ 461,619 Accrued Professional Services 217,721 138,438 Accrued Warranty Obligations 98,893 218,047 Other Accrued Expenses 174,614 795,974 Total $ 885,897 $ 1,614,078 |
Schedule of changes in accrued warranty obligations | The changes in the Company’s accrued warranty obligations for the years ended December 31, 2019, 2018 and 2017 were as follows: Accrued Warranty Obligations at December 31, 2016 $ 41,132 Reductions for Settling Warranties (157,035) Warranty Issued During Year 283,406 Accrued Warranty Obligations at December 31, 2017 167,503 Reductions for Settling Warranties (257,173) Warranty Issued During Year 307,717 Accrued Warranty Obligations at December 31, 2018 218,047 Reductions for Settling Warranties (204,583) Warranty Issued During Year 85,429 Accrued Warranty Obligations at December 31, 2019 $ 98,893 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Taxes | |
Schedule Of Pre Tax Earnings | Pre-tax earnings consisted of the following for the years ended: December 31, December 31, December 31, 2019 2018 2017 Pre-Tax Income (Loss) U.S. $ (26,482,033) $ (22,082,137) $ (19,680,720) Outside the U.S. 5,663 206,424 47,218 Total Pre-Tax Income (Loss) $ (26,476,370) $ (21,875,713) $ (19,633,502) |
Schedule of Components of Income Tax Expense (Benefit) | The provision expense/(benefit) for income taxes for the years ended December 31, 2019, 2018 and 2017 was as follows: 2019 2018 2017 U.S. Income Taxes: Current Provision $ — $ — $ — Deferred Provision (5,382,746) (4,848,470) 3,639,752 Valuation Allowance 5,382,746 4,848,470 (3,639,752) Income Taxes Outside the U.S.: Current Provision — — — Deferred Provision (511,672) 41,285 215,745 Valuation Allowance 511,672 (41,285) (215,745) State Income Taxes: Current Provision — — — Deferred Provision (189,200) (140,933) (59,530) Valuation Allowance 189,200 140,933 59,530 Total Provision $ — $ — $ — |
Schedule of Effective Income Tax Rate Reconciliation | A reconciliation of the statutory U.S. federal income tax rate to the effective rates for the years ended December 31, 2019, 2018 and 2017 is as follows: 2019 2018 2017 % % % Federal Income Tax at Statutory Rate 21.0 21.0 34.0 State Tax Provision, Net of Federal Benefit 0.3 0.3 0.3 Change in Corporate Tax Rates from 34% to 21% — — (52.9) Permanent Differences (0.1) (1.5) (2.4) Federal Tax Credits 1.3 2.5 1.1 Stock Compensation (1.9) — — Foreign Tax Provision 1.9 — — Other 0.5 0.3 0.6 Effective Tax Rate 23.0 22.6 (19.3) Change in Valuation Allowance (23.0) (22.6) 19.3 Net Effective Tax Rate — — — |
Schedule of Deferred Tax Assets and Liabilities | Significant components of the Company’s deferred tax assets and liabilities at year end are as follows: December 31, December 31, December 31, 2019 2018 2017 Deferred Tax Assets: Net Operating Loss Carry-forwards $ 25,678,591 $ 20,920,285 $ 16,167,791 Tax Credit Carry-forwards 3,535,863 3,035,384 2,404,490 Inventory Valuation Adjustment 982,160 104,450 675,830 Officer’s Compensation — — 86,670 Stock-based Compensation — 175,753 — Lease Obligation Liability 446,488 — — Other 263,348 207,327 108,734 Total Deferred Tax Assets 30,906,450 24,443,199 19,443,515 Deferred Tax Liabilities: Income from Foreign Operations — 59,123 17,838 Lease Right of Use Asset 446,488 — — Other 14,335 22,069 11,789 Total Deferred Tax Liabilities 460,823 81,192 29,627 Net Deferred Tax Assets Before Valuation Allowance $ 30,445,627 $ 24,362,007 $ 19,413,888 Valuation Allowance (30,445,627) (24,362,007) (19,413,888) Net Deferred Tax Assets $ — $ — $ — |
Stock Warrants (Tables)
Stock Warrants (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Stock Warrants | |
Schedule of changes in warrants | The following table shows the various changes in warrants for the years ended: December 31, December 31, December 31, 2019 2018 2017 Warrants Outstanding, Beginning of Year 2,233,062 1,184,912 401,859 Exercised During the Year — (113,850) (250,009) Issued During the Year 5,479,454 1,200,000 1,033,062 Expired During the Year (1,200,000) (38,000) — Warrants Outstanding, End of Year 6,512,516 2,233,062 1,184,912 |
Stock Option Plans (Tables)
Stock Option Plans (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Stock Option Plans [Abstract] | |
Stock option plans | Options outstanding under the Stock Options Plans are as follows: 2007 2009 2014 Plan Plan Plan Total Outstanding as of December 31, 2017 10,665 117,094 1,382,485 1,510,244 Available for future issuance under plan — — 1,045,143 1,045,143 Total authorized by plan 10,665 117,094 2,427,628 2,555,387 Outstanding as of December 31, 2018 — 110,771 1,435,750 1,546,521 Available for future issuance under plan — — 4,082,584 4,082,584 Totals authorized by plan — 110,771 5,518,334 5,629,105 Outstanding as of December 31, 2019 — 85,498 1,298,093 1,383,591 Available for future issuance under plan — — 5,329,309 5,329,309 Totals authorized by plan — 85,498 6,627,402 6,712,900 |
Schedule of Summary of Stock Option Activity | The following table summarizes stock option activity for the years ended December 31, 2019, 2018 and 2017: Weighted Weighted Average Number of Average Remaining Life Options Exercise Price (years) Outstanding at December 31, 2016 1,084,298 $ 4.76 7.57 Granted 534,500 5.74 Exercised (63,187) 2.89 Expired or Forfeited (45,367) 8.30 Outstanding at December 31, 2017 1,510,244 $ 5.04 7.58 Granted 330,500 5.81 Exercised (97,264) 4.96 Expired or Forfeited (196,959) 6.11 Outstanding at December 31, 2018 1,546,521 $ 5.11 7.19 Granted 73,500 2.36 Exercised — — Expired or Forfeited (236,430) 6.21 Outstanding at December 31, 2019 1,383,591 $ 4.77 |
Summary of assumptions used to compute the fair value of stock options granted | The following summary table shows the assumptions used to compute the fair value of stock options granted during 2019, 2018 and 2017 and their estimated value: December 31, 2019 2018 2017 Assumptions for Black-Scholes: Expected term in years 6.2 to 6.3 6.4 to 6.6 6.5 to 6.8 Volatility 79.4% to 89.4 % 108.9% to 119.4 % 122.8% to 133.0 % Risk-free interest rate 1.63% to 1.68 % 2.95% to 3.08 % 1.98% to 2.30 % Expected annual dividends None None None Value of options granted: Number of options granted 73,500 330,500 534,500 Weighted average fair value per share $ 1.71 $ 5.01 $ 5.24 Fair value of options granted $ 125,814 $ 1,655,390 $ 2,803,329 |
Right-of-Use Assets and Liabi_2
Right-of-Use Assets and Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Right-of-Use Assets and Liabilities | |
Schedule of Future lease payments under operating leases | Future lease payments under operating leases as of December 31, 2019 were as follows: 2020 $ 608,698 2021 599,190 2022 587,286 2023 489,405 Total Future Lease Payments 2,284,579 Less: Imputed Interest (188,389) Total Lease Liability Balance $ 2,096,190 |
Geographic and Other Financia_2
Geographic and Other Financial Information (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Geographic and Other Financial Information (Unaudited) | |
Revenue from External Customers by Geographic Areas | Geographical revenue information, based on ship-to destination of the customers for the three years ended December 31, 2019, 2018 and 2017 is as follows (in thousands): By Continent and Region: Fiscal Year 2019 2018 2017 Revenue % of Total Revenue % of Total Revenue % of Total North America $ 2,781 42 % $ 3,550 44 % $ 1,687 30 % Asia-Pacific 2,058 31 % 2,248 28 % 1,927 35 % Europe 1,656 25 % 2,183 27 % 1,892 34 % Others 176 2 % 113 1 % 32 1 % Total Revenues $ 6,671 100 % $ 8,094 100 % $ 5,538 100 % By Country: Fiscal Year 2019 2018 2017 Revenue % of Total Revenue % of Total Revenue % of Total US $ 2,673 40 % $ 3,475 43 % $ 1,618 29 % China 984 15 % 17 0 % — 0 % Japan 873 13 % 1,261 16 % 1,340 24 % Germany 778 12 % 492 6 % 526 9 % Others 1,363 20 % 2,849 35 % 2,054 38 % Total Revenues $ 6,671 100 % $ 8,094 100 % $ 5,538 100 % |
Quarterly Financial Informati_2
Quarterly Financial Information (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information (Unaudited) | |
Quarterly Financial Information | The following table summarizes our unaudited quarterly financial information for the periods shown below (in thousands, except per share data): Fiscal Year 2019 December 31, September 30, June 30, March 31, Revenue $ 1,953 $ 1,159 $ 2,186 $ 1,373 Gross profit (loss) (4,369) (231) 152 40 Net loss (9,583) (5,477) (5,056) (6,360) Net loss per share, basic and diluted (0.31) (0.18) (0.20) (0.25) Net loss attributable to common stockholders (10,081) (5,967) (5,534) (6,826) Fiscal Year 2018 December 31, September 30, June 30, March 31, Revenue $ 1,979 $ 1,923 $ 2,648 $ 1,544 Gross profit (loss) 300 621 670 177 Net loss (5,564) (4,798) (6,148) (5,366) Net loss per share, basic and diluted (0.22) (0.19) (0.24) (0.22) Net loss attributable to common stockholders (6,033) (5,260) (6,599) (5,804) |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Property Plant And Equipment Useful Life (Details) | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Computers and Purchased Software | |
Property, Plant and Equipment, Useful Life | 3 years |
Leasehold Improvements | |
Property, Plant and Equipment, Estimated Useful Lives | Lesser of expected life or lease term |
Manufacturing Equipment | |
Property, Plant and Equipment, Useful Life | 5 years |
Tooling | |
Property, Plant and Equipment, Useful Life | 3 years |
Furniture and Equipment | |
Property, Plant and Equipment, Useful Life | 5 years |
Software and Software Development Costs | |
Development Costs, Net | $ 100,000 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Additional Information (Details) - USD ($) | Dec. 17, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Summary Of Significant Accounting Policies [Line Items] | ||||
Advertising Expense | $ 1,302,120 | $ 1,631,161 | $ 1,386,977 | |
Stock Based Compensation And Common Stock Awards Expenses | $ 1,498,357 | $ 2,197,481 | $ 1,623,272 | |
Earnings Per Share, Potentially Dilutive Securities | 12,858,707 | 8,742,183 | 7,657,756 | |
Impairment of Intangible Assets, Finite-lived | $ 0 | $ 0 | ||
Allowance for Doubtful Accounts Receivable | 0 | 7,280 | ||
Promissory note receivable | $ 250,000 | |||
Interest rate (as a percent) | 8.00% | |||
Accrued Revenue, Current | 0 | |||
Outstanding customer deposits | $ 0 | $ 152,362 | ||
Minimum [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Finite-Lived Intangible Assets, Remaining Amortization Period | 3 years | |||
Ownership interest if conversion price triggered | 1.00% | |||
Maximum [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Ownership interest if conversion price triggered | 2.50% | |||
Trademarks and Patents | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Finite-Lived Intangible Assets, Remaining Amortization Period | 15 years | |||
Confidential Defense Customer | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Concentration Risk, Percentage | 100.00% | |||
Confidential Defense Customer | Accounts Receivable [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Concentration Risk, Percentage | 13.00% | |||
SATS Airport [Member] | Total revenues [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Concentration Risk, Percentage | 10.00% | |||
Foxconn [Member] | Total revenues [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Concentration Risk, Percentage | 16.00% | 17.00% | 18.00% | |
Foxconn [Member] | Accounts Receivable [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Concentration Risk, Percentage | 26.00% | 32.00% | 25.00% | |
Foxconn [Member] | Accrued Project Revenue [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Concentration Risk, Percentage | 100.00% | |||
Ubimax GmbH [Member] | Accounts Receivable [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Concentration Risk, Percentage | 32.00% | |||
AMA SA [Member] | Total revenues [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Concentration Risk, Percentage | 10.00% | |||
Sats [Member] | Accounts Receivable [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Concentration Risk, Percentage | 38.00% |
Revenue Recognition and Contr_3
Revenue Recognition and Contracts with Customers - Company's total revenue by major product lines (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenue | $ 1,953,000 | $ 1,159,000 | $ 2,186,000 | $ 1,373,000 | $ 1,979,000 | $ 1,923,000 | $ 2,648,000 | $ 1,544,000 | $ 6,670,604 | $ 8,094,368 | $ 5,537,753 |
Smart Glasses and iWear Video Headphone Sales [Member] | |||||||||||
Revenue | 4,893,384 | 6,512,202 | 4,197,633 | ||||||||
OEM Product Sales [Member] | |||||||||||
Revenue | 951,570 | 994,500 | |||||||||
Waveguide and Display Engine Sales [Member] | |||||||||||
Revenue | 152,499 | 185,400 | 351,056 | ||||||||
Engineering Services [Member] | |||||||||||
Revenue | $ 673,151 | $ 402,266 | $ 989,064 |
Revenue Recognition and Contr_4
Revenue Recognition and Contracts with Customers - Company's net sales as a percentage (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Revenue Performance Obligation Percentage | 100.00% |
Point-in-Time - Output Method [Member] | |
Revenue Performance Obligation Percentage | 90.00% |
Over Time - Input Method [Member] | |
Revenue Performance Obligation Percentage | 10.00% |
Revenue Recognition and Contr_5
Revenue Recognition and Contracts with Customers - Additional Information (Details) | Dec. 31, 2019USD ($) |
Revenue Recognition and Contracts with Customers | |
Revenue, Remaining Performance Obligation | $ 123,000 |
Going Concern - Additional Info
Going Concern - Additional Information (Details) - USD ($) | Jul. 02, 2019 | Jan. 24, 2018 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Net Income Loss | $ (9,583,000) | $ (5,477,000) | $ (5,056,000) | $ (6,360,000) | $ (5,564,000) | $ (4,798,000) | $ (6,148,000) | $ (5,366,000) | $ (26,476,370) | $ (21,875,713) | $ (19,633,502) | ||
Retained Earnings Accumulated Deficit | $ (144,742,811) | $ (118,266,441) | (144,742,811) | (118,266,441) | |||||||||
Inventory Reserve For Obsolescence | 4,572,659 | 0 | 0 | ||||||||||
Stock Issued During Period, Value, New Issues | $ 20,000,007 | $ 30,000,000 | 20,000,007 | 30,000,000 | 21,128,502 | ||||||||
Proceeds from Issuance of Common Stock | $ 18,855,007 | 20,000,007 | $ 30,000,000 | 21,128,502 | |||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 1,200,000 | ||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 6.44 | $ 6.44 | |||||||||||
Stock Purchase Price | $ 3.65 | $ 10 | |||||||||||
Common Stock | |||||||||||||
Net Income Loss | $ 0 | $ 0 | $ 0 | ||||||||||
Stock Issued During Period, Shares, New Issues | 5,479,454 | 3,000,000 | 5,479,454 | 3,000,000 | 3,566,116 | ||||||||
Stock Issued During Period, Value, New Issues | $ 20,000,007 | $ 5,479 | $ 3,000 | $ 3,566 | |||||||||
Proceeds from Issuance of Common Stock | $ 18,855,007 | ||||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 5,479,454 | ||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 4.10 | ||||||||||||
Stock Purchase Price | $ 4.10 | $ 0.4 |
Inventories, Net- Components of
Inventories, Net- Components of Inventories (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Disclosure Components Of Inventories [Abstract] | ||
Purchased Parts and Components | $ 5,985,214 | $ 3,284,848 |
Work in Process | 2,414,142 | 1,523,616 |
Finished Goods | 2,096,744 | 2,837,183 |
Less: Reserve for Obsolescence | (4,788,233) | (363,845) |
Inventories, Net | $ 5,707,867 | $ 7,281,802 |
Inventories, Net - Additional I
Inventories, Net - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Inventories, Net | |||
Net realizable value on inventory write-down | $ 3,153,028 | ||
Additional obsolescence provision | 1,419,631 | ||
Inventory Reserve For Obsolescence | $ 4,572,659 | $ 0 | $ 0 |
Fixed Assets, Net - Schedule Of
Fixed Assets, Net - Schedule Of Fixed Assets (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 8,904,134 | $ 7,347,175 |
Less: Accumulated Depreciation | (4,576,458) | (3,055,485) |
Property, Plant and Equipment, Net, Total | 4,327,676 | 4,291,690 |
Tooling and Manufacturing Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 5,262,080 | 4,199,309 |
Leasehold Improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 773,734 | 487,957 |
Computers and Purchased Software | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 824,965 | 937,946 |
Furniture and Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 2,043,355 | $ 1,721,963 |
Fixed Assets, Net - Additional
Fixed Assets, Net - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Tooling and Equipment | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation and Amortization | $ 1,913,409 | $ 1,273,527 | $ 921,113 |
Patents and Trademarks, Net - S
Patents and Trademarks, Net - Schedule Of Patents and Trademarks (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Finite-Lived Intangible Assets [Line Items] | ||
Intangible Assets, Net (Excluding Goodwill), Total | $ 1,294,675 | $ 1,164,543 |
Patents and Trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Patents and Trademarks | 2,020,070 | 1,769,767 |
Less: Accumulated Amortization | (725,395) | (605,224) |
Intangible Assets, Net (Excluding Goodwill), Total | $ 1,294,675 | $ 1,164,543 |
Patents and Trademarks, Net - A
Patents and Trademarks, Net - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Patents and Trademarks, Net | |||
Amortization | $ 120,172 | $ 94,137 | $ 77,415 |
Impairment of Software Development Cost | 0 | $ 0 | |
Estimated aggregate annual amortization expense for next five fiscal years | $ 135,000 |
Licenses, Net (Details)
Licenses, Net (Details) - Licensing Agreements [Member] - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Licenses,Net [Line Items] | ||
Licenses | $ 493,717 | $ 493,717 |
Less: Accumulated Amortization | (179,301) | (56,597) |
Licenses, Net | $ 314,416 | $ 437,120 |
Licenses, Net - Additional Info
Licenses, Net - Additional Information (Details) - USD ($) | Jul. 02, 2019 | Oct. 04, 2018 | Jan. 24, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Licenses,Net [Line Items] | ||||||
Research and Development Expense | $ 8,900,837 | $ 10,378,728 | $ 6,706,690 | |||
Stock Issued During Period, Value, New Issues | $ 20,000,007 | $ 30,000,000 | 20,000,007 | 30,000,000 | 21,128,502 | |
Payments to Acquire Intangible Assets | $ 250,304 | 444,906 | 599,444 | |||
Intellectual Property [Member] | ||||||
Licenses,Net [Line Items] | ||||||
Patents Application Cost | $ 75,702 | |||||
Stock Issued During Period, Shares, New Issues | 25,000 | |||||
Stock Issued After Development | 25,000 | |||||
Stock Issued After Commercialization Of Products | 50,000 | |||||
Research and Development Expense | $ 250,000 | |||||
Stock Issued During Period, Value, New Issues | 128,750 | |||||
Licensing Agreements [Member] | ||||||
Licenses,Net [Line Items] | ||||||
Finite-Lived Intangible Asset, Useful Life | 10 years | |||||
Amortization of Intangible Assets | $ 122,704 | $ 56,597 | 0 | |||
Payments to Acquire Intangible Assets | $ 250,000 | $ 114,967 | ||||
Licensing Agreements [Member] | Wakingapp ltd [Member] | ||||||
Licenses,Net [Line Items] | ||||||
Equity Method Investment, Ownership Percentage | 1.00% | |||||
Commercial Agreement Description | provide full support of the Company's AR products through the WakingApp AR tool software; (ii) provide three (3) working AR environments built with their tools to give away as demonstrations on the M300 and M300XL; and (iii) allow the Company to provide 60-day free licenses to their AR software tool to up to 100,000 of the Company's developers and customers. The Company considers this investment as a prepaid licensing arrangement over a 36-month term; as such, this addition will be amortized over three years and included in Cost of Sales – Products in the Consolidated Statement of Operations |
Intangible Asset, Net - Schedul
Intangible Asset, Net - Schedule of Finite-Lived Intangible Assets (Details) - Intangible Assets [Member] - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Intangible Asset | $ 1,500,000 | $ 1,500,000 |
Less: Accumulated Amortization | (510,000) | (102,000) |
Intangible Asset, Net | $ 990,000 | $ 1,398,000 |
Intangible Asset, Net - Additio
Intangible Asset, Net - Additional Information (Details) - TDG Acquisition Company LLC [Member] - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Total commission expense | $ 116,469 | $ 0 |
Amortization of Intangible Assets | 408,000 | $ 102,000 |
Future monthly amortization expense | $ 34,000 |
Other Assets (Details)
Other Assets (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Other | $ 9,192 | |
Private Corporation Investment | $ 250,000 | 250,000 |
Total Other Assets, Non-Amortizing | 250,000 | 259,192 |
Total Other Assets | 350,000 | 459,192 |
Software Development | ||
Software development costs | 300,000 | 496,223 |
Less: Accumulated Amortization | (200,000) | (100,000) |
Less: Impairment | (196,223) | |
Software Development Costs, Net | $ 100,000 | $ 200,000 |
Other Assets - Additional Infor
Other Assets - Additional Information (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Jun. 30, 2018 | |
Other assets [Line Items] | ||||
Purchase Price | $ 250,000 | |||
Capitalized Software Development Costs | ||||
Other assets [Line Items] | ||||
Amortization expense | $ 100,000 | $ 100,000 | $ 214,838 | |
Private Corporation [Member] | ||||
Other assets [Line Items] | ||||
Equity Method Investment, Ownership Percentage | 1.00% |
Accrued Expenses - Components o
Accrued Expenses - Components of Accrued Expenses (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Accrued Liabilities Line Items | ||
Accrued Wages and Related Costs | $ 394,669 | $ 461,619 |
Accrued Professional Services | 217,721 | 138,438 |
Accrued Warranty Obligations | 98,893 | 218,047 |
Other Accrued Expenses | 174,614 | 795,974 |
Total | $ 885,897 | 1,614,078 |
TDG Acquisition Company LLC [Member] | ||
Accrued Liabilities Line Items | ||
Other Accrued Expenses | $ 750,000 |
Accrued Expenses - Changes in A
Accrued Expenses - Changes in Accrued Warranty Obligations (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Accrued Expenses | |||
Accrued Warranty Obligation | $ 218,047 | $ 167,503 | $ 41,132 |
Reductions for Settling Warranties | (204,583) | (257,173) | (157,035) |
Warranties Issued During Period | 85,429 | 307,717 | 283,406 |
Accrued Warranty Obligations | $ 98,893 | $ 218,047 | $ 167,503 |
Accrued Expenses - Additional I
Accrued Expenses - Additional Information (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Other Accrued Liabilities, Current | $ 174,614 | $ 795,974 |
TDG Acquisition Company LLC [Member] | ||
Other Accrued Liabilities, Current | $ 750,000 |
Income Taxes - Pre-Tax Earnings
Income Taxes - Pre-Tax Earnings (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Pre-Tax Income (Loss) | |||
Total Pre-Tax Income (Loss) | $ (26,476,370) | $ (21,875,713) | $ (19,633,502) |
US | |||
Pre-Tax Income (Loss) | |||
Total Pre-Tax Income (Loss) | (26,482,033) | (22,082,137) | (19,680,720) |
Outside the U.S. [Member] | |||
Pre-Tax Income (Loss) | |||
Total Pre-Tax Income (Loss) | $ 5,663 | $ 206,424 | $ 47,218 |
Income Taxes - Provision Benefi
Income Taxes - Provision Benefit For Income Taxes (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
U.S. Income Taxes: | |||
Current Provision | $ 0 | $ 0 | |
Deferred Provision | $ (5,382,746) | (4,848,470) | 3,639,752 |
Valuation Allowance | 5,382,746 | 4,848,470 | (3,639,752) |
Income Taxes Outside the U.S.: | |||
Current Provision | 0 | 0 | |
Deferred Provision | (511,672) | 41,285 | 215,745 |
Valuation Allowance | 511,672 | (41,285) | (215,745) |
State Income Taxes: | |||
Current Provision | 0 | 0 | |
Deferred Provision | (189,200) | (140,933) | (59,530) |
Valuation Allowance | $ 189,200 | 140,933 | 59,530 |
Income Tax Expense (Benefit), Total | $ 0 | $ 0 |
Income Taxes - Reconciliation O
Income Taxes - Reconciliation Of Effective Rate (Details) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Taxes | |||
Federal Income Tax at Statutory Rate | 21.00% | 21.00% | 34.00% |
State Tax Provision, Net of Federal Benefit | 0.30% | 0.30% | 0.30% |
Change in Corporate Tax Rates from 34% to 21% | 0.00% | (52.90%) | |
Permanent Differences | (0.10%) | (1.50%) | (2.40%) |
Federal Tax Credits | 1.30% | 2.50% | 1.10% |
Stock Compensation | (1.90%) | ||
Foreign Tax Provision | 1.90% | ||
Other | 0.50% | 0.30% | 0.60% |
Effective Tax Rate | 23.00% | 22.60% | (19.30%) |
Change in Valuation Allowance | (23.00%) | (22.60%) | 19.30% |
Net Effective Tax Rate | 0.00% | 0.00% |
Income Taxes - Components Of De
Income Taxes - Components Of Deferred Tax assets And liabilities (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2016 |
Deferred Tax Assets: | |||
Net Operating Loss Carry-forwards | $ 25,678,591 | $ 20,920,285 | $ 16,167,791 |
Tax Credit Carry-forwards | 3,535,863 | 3,035,384 | 2,404,490 |
Inventory Valuation Adjustment | 982,160 | 104,450 | 675,830 |
Officer's Compensation | 0 | 86,670 | |
Stock-based Compensation | 175,753 | 0 | |
Lease Obligation Liability | 446,488 | ||
Other | 263,348 | 207,327 | 108,734 |
Total Deferred Tax Assets | 30,906,450 | 24,443,199 | 19,443,515 |
Deferred Tax Liabilities: | |||
Income from Foreign Operations | 59,123 | 17,838 | |
Lease Rigth of Use Asset | 446,488 | ||
Other | 14,335 | 22,069 | 11,789 |
Total Deferred Tax Liabilities | 460,823 | 81,192 | 29,627 |
Net Deferred Tax Assets Before Valuation Allowance | 30,445,627 | 24,362,007 | 19,413,888 |
Valuation Allowance | $ (30,445,627) | (24,362,007) | (19,413,888) |
Net Deferred Tax Assets | $ 0 | $ 0 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) | Dec. 31, 2019USD ($) |
Operating Loss Carryforwards [Line Items] | |
Federal and State Net Operating Loss Carryforwards | $ 3,400,000 |
US | |
Operating Loss Carryforwards [Line Items] | |
Federal and State Net Operating Loss Carryforwards | 118,000,000 |
UNITED KINGDOM | |
Operating Loss Carryforwards [Line Items] | |
Federal and State Net Operating Loss Carryforwards | 129,000 |
Japan | |
Operating Loss Carryforwards [Line Items] | |
Federal and State Net Operating Loss Carryforwards | 1,350,000 |
Federal And State | |
Operating Loss Carryforwards [Line Items] | |
Federal and State Net Operating Loss Carryforwards | $ 3,500,000 |
Capital Stock - Additional Info
Capital Stock - Additional Information (Details) - USD ($) | Jul. 02, 2019 | Jan. 24, 2018 | Jan. 02, 2015 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Preferred Stock, Shares Authorized | 5,000,000 | 5,000,000 | ||||
Conversion of Stock, Description | Each share of Series A Preferred Stock is convertible, at the option of the Series A Purchaser, into 100 shares of the Company's common stock (determined by dividing the Series A Original Issue Price of $500 by the Series A Conversion Price). The Series A Conversion Price is $5.00, subject to adjustment in the event of stock splits, dividends or other combinations | |||||
Stock Issued During Period, Value, New Issues | $ 20,000,007 | $ 30,000,000 | $ 20,000,007 | $ 30,000,000 | $ 21,128,502 | |
Preferred Stock, Liquidation Preference Per Share | $ 1,000 | |||||
Preferred Stock, Shares Outstanding | 49,626 | 49,626 | ||||
Dividends Payable | $ 8,601,092 | |||||
Common Stock, Shares Authorized | 100,000,000 | 100,000,000 | ||||
Common Stock, Shares, Issued | 33,128,620 | 27,591,670 | ||||
Common Stock, Shares, Outstanding | 33,128,620 | 27,591,670 | ||||
Common Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 | ||||
Preferred Stock, Shares Issued | 49,626 | 49,626 | ||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 6.44 | |||||
Proceeds from Issuance of Common Stock | $ 18,855,007 | $ 20,000,007 | $ 30,000,000 | $ 21,128,502 | ||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 1,200,000 | |||||
Stock Purchase Price | $ 3.65 | $ 10 | ||||
Common Stock | ||||||
Stock Issued During Period, Shares, New Issues | 5,479,454 | 3,000,000 | 5,479,454 | 3,000,000 | 3,566,116 | |
Shares Issued, Price Per Share | $ 3.65 | |||||
Stock Issued During Period, Value, New Issues | $ 20,000,007 | $ 5,479 | $ 3,000 | $ 3,566 | ||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 4.10 | |||||
Proceeds from Issuance of Common Stock | $ 18,855,007 | |||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 5,479,454 | |||||
Stock Purchase Price | $ 4.10 | $ 0.4 | ||||
Preferred Stock | ||||||
Preferred Stock, Shares Authorized | 5,000,000 | 5,000,000 | ||||
Stock Issued During Period, Shares, New Issues | 0 | |||||
Stock Issued During Period, Value, New Issues | $ 0 | $ 0 | $ 0 | |||
Preferred Stock, Shares Outstanding | 49,626 | 49,626 | ||||
Preferred Stock, Shares Issued | 49,626 | 49,626 | ||||
Series A Preferred Stock [Member] | ||||||
Preferred Stock, Dividend Rate, Percentage | 6.00% | |||||
Preferred Stock Shares Outstanding In Percent | 20.00% | |||||
Description of Preferred Stock | For as long as at least 25% (or 12,406 shares) of the Series A Preferred Stock is outstanding, the Company may not, without the consent of holders of at least 60% of the then outstanding shares of Series A Preferred Stock, take certain actions, including but not limited to: (i) liquidate, dissolve, or wind up the business and affairs of the Company; (ii) amend, alter or repeal any provision of its charter or bylaws in a manner that adversely effects the rights of the Series A Preferred Stock; (iii) create or issue any capital stock that is equal to or senior to the Series A Preferred Stock with respect to preferences; (iv) create or issue any debt security, subject to certain exceptions; (v) pay off any debt obligation prior to its stated maturity date; or (vi) enter into any stockholders rights plan or similar arrangement or take other actions that may limit actions that holders of a majority of the Series A Preferred Stock can take under Section 203 of the Delaware General Corporation Law, as well as such other customary provisions protecting the rights of the holder of the Series A Preferred Stock, as are outlined in the Certificate of Designation | |||||
Series A Preferred Stock [Member] | Director [Member] | ||||||
Preferred Stock Shares Outstanding In Percent | 40.00% | |||||
Series A Preferred Stock [Member] | Corporation [Member] | ||||||
Stock Issued During Period, Shares, New Issues | 49,626 | |||||
Shares Issued, Price Per Share | $ 500 | |||||
Stock Issued During Period, Value, New Issues | $ 24,813,000 |
Stock Warrants - Changes in War
Stock Warrants - Changes in Warrants (Details) - shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Stock Warrants | |||
Warrants Outstanding, Beginning of Year | 2,233,062 | 1,184,912 | 401,859 |
Exercised During the Year | (113,850) | (250,009) | |
Issued During the Year | 5,479,454 | 1,200,000 | 1,033,062 |
Expired During the Year | (1,200,000) | (38,000) | |
Warrants Outstanding, End of Year | 6,512,516 | 2,233,062 | 1,184,912 |
Stock Warrants - Additional Inf
Stock Warrants - Additional Information (Details) - USD ($) | 12 Months Ended | ||||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Jan. 26, 2019 | Dec. 31, 2016 | |
Class of Warrant or Right [Line Items] | |||||
Weighted average term of warrants | 1 year 2 months 12 days | 3 years 1 month 6 days | |||
Class of Warrant or Right Weighted Average Exercise Price of Warrants or Rights | $ 8.61 | ||||
Weighted average exercise price of warrants per share | $ 6.44 | ||||
Class Of Warrant Or Right Issued | 5,479,454 | ||||
Warrants outstanding | 6,512,516 | 2,233,062 | 1,184,912 | 401,859 | |
Stock Issued During Period, Shares, Warrant Exercised | 66,710 | 168,203 | |||
Class Of Warrant Exercised In Cashless Basis | 96,350 | 250,009 | |||
Class Of Warrant Exercised In Cash Basis | 17,500 | ||||
Warrants | |||||
Class of Warrant or Right [Line Items] | |||||
Weighted average term of warrants | 1 year 10 months 24 days | ||||
Weighted average exercise price of warrants per share | $ 4.56 | ||||
Number of warrants expires | 1,200,000 | ||||
Warrants outstanding | 1,033,062 | ||||
Warrants 1 | |||||
Class of Warrant or Right [Line Items] | |||||
Class Of Warrant Exercised In Cash Basis | 17,500 | ||||
Proceeds from Issuance of Warrants | $ 39,373 |
Stock Option Plans - Summary Of
Stock Option Plans - Summary Of Stock Option Plans (Details) - shares | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Stock Option Plan [Line Items] | |||
Stock Options Plans, Outstanding | 1,383,591 | 1,546,521 | 1,510,244 |
Available for future issuance under plan | 5,329,309 | 4,082,584 | 1,045,143 |
Totals authorized by plan | 6,712,900 | 5,629,105 | 2,555,387 |
2007 Plan | |||
Stock Option Plan [Line Items] | |||
Stock Options Plans, Outstanding | 0 | 10,665 | |
Available for future issuance under plan | 0 | 0 | 0 |
Totals authorized by plan | 0 | 0 | 10,665 |
2009 Plan | |||
Stock Option Plan [Line Items] | |||
Stock Options Plans, Outstanding | 85,498 | 110,771 | 117,094 |
Available for future issuance under plan | 0 | 0 | 0 |
Totals authorized by plan | 85,498 | 110,771 | 117,094 |
2014 Plan | |||
Stock Option Plan [Line Items] | |||
Stock Options Plans, Outstanding | 1,298,093 | 1,435,750 | 1,382,485 |
Available for future issuance under plan | 5,329,309 | 4,082,584 | 1,045,143 |
Totals authorized by plan | 6,627,402 | 5,518,334 | 2,427,628 |
Stock Option Plans - Summary _2
Stock Option Plans - Summary of Stock Option Activity (Details) - $ / shares | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Number of Options | ||||
Outstanding, Beginning Balance | 1,546,521 | 1,510,244 | ||
Outstanding, Ending Balance | 1,383,591 | 1,546,521 | 1,510,244 | |
Weighted Average Remaining Life (Years) | ||||
Options Outstanding, Weighted Average Remaining Life (Years) | 6 years 3 months | 7 years 2 months 9 days | 7 years 6 months 29 days | 7 years 6 months 22 days |
Employee Stock Option [Member] | ||||
Number of Options | ||||
Outstanding, Beginning Balance | 1,546,521 | 1,510,244 | 1,084,298 | |
Granted | 73,500 | 330,500 | 534,500 | |
Exercised | (97,264) | (63,187) | ||
Expired or Forfeited | (236,430) | (196,959) | (45,367) | |
Outstanding, Ending Balance | 1,383,591 | 1,546,521 | 1,510,244 | 1,084,298 |
Weighted Average Exercise Price | ||||
Outstanding, Beginning Balance | $ 5.11 | $ 5.04 | $ 4.76 | |
Granted | 2.36 | 5.81 | 5.74 | |
Exercised | 4.96 | 2.89 | ||
Expired or Forfeited | 6.21 | 6.11 | 8.30 | |
Outstanding, Ending Balance | $ 4.77 | $ 5.11 | $ 5.04 | $ 4.76 |
Stock Option Plans - Assumption
Stock Option Plans - Assumptions Used To Compute The Fair Value Of Stock Options (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Value of options granted: | |||
Number of options granted | 73,500 | 330,500 | 534,500 |
Weighted average fair value per share | $ 1.71 | $ 5.01 | $ 5.24 |
Fair value of options issued | $ 125,814 | $ 1,655,390 | $ 2,803,329 |
Minimum [Member] | |||
Assumptions for Black-Scholes: | |||
Expected term in years | 6 years 2 months 12 days | 6 years 6 months | 6 years 6 months |
Volatility | 79.40% | 108.90% | 122.80% |
Risk-free interest rate | 1.63% | 2.95% | 1.98% |
Maximum [Member] | |||
Assumptions for Black-Scholes: | |||
Expected term in years | 6 years 3 months 18 days | 6 years 6 months | 6 years 9 months 18 days |
Volatility | 89.40% | 119.40% | 133.00% |
Risk-free interest rate | 1.68% | 3.08% | 2.30% |
Stock Option Plans - Additional
Stock Option Plans - Additional Information (Details) - USD ($) | Jun. 13, 2018 | Dec. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2014 |
Stock-Based Compensation Plans | ||||||
Exercisable Options Outstanding Shares | 797,861 | 1,015,019 | 936,406 | 797,861 | ||
Weighted average exercise price per share, Exercisable | $ 4.65 | $ 4.63 | $ 4.66 | $ 4.65 | ||
Unvested Options Outstanding, Shares | 712,383 | 368,572 | 610,115 | 712,383 | ||
Unvested Options Outstanding, Weighted average exercise price | $ 5.48 | $ 5.17 | $ 5.80 | |||
Unvested Options Outstanding Weighted average remaining life (years) | 8 years 8 months 12 days | 8 years 6 months | 8 years 10 months 24 days | |||
Weighted average remaining contractual term on vested options | 6 years 4 months 24 days | 5 years 5 months 9 days | 6 years 1 month 6 days | |||
Unrecognized stock compensation expense | $ 1,616,503 | |||||
Weighted average recognition period | 2 years 3 months 18 days | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 2,555,387 | 6,712,900 | 5,629,105 | 2,555,387 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Intrinsic Value | $ 2,323,312 | $ 0 | $ 912,360 | $ 2,323,312 | ||
2014 Plan | ||||||
Stock-Based Compensation Plans | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 2,427,628 | 6,627,402 | 5,518,334 | 2,427,628 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Percentage of Outstanding Stock Maximum | 20.00% | 20.00% | 10.00% | 10.00% | ||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage | 100.00% | |||||
2014 Plan | Common Stock | ||||||
Stock-Based Compensation Plans | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 1,000,000 |
Right-of-Use Assets and Liabi_3
Right-of-Use Assets and Liabilities - Operating Leases (Details) | Dec. 31, 2019USD ($) |
Right-of-Use Assets and Liabilities | |
2020 | $ 608,698 |
2021 | 599,190 |
2022 | 587,286 |
2023 | 489,405 |
Total Future Lease Payments | 2,284,579 |
Less: Imputed Interest | (188,389) |
Total Lease Liability Balance | $ 2,096,190 |
Right-of-Use Assets and Liabi_4
Right-of-Use Assets and Liabilities - Additional Information (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Jan. 01, 2019 | |
Operating Lease Right-of-Use Asset | $ 2,096,190 | |||
Current Operating Lease Liability | 524,825 | |||
Long-term Operating Lease Liability | $ 1,571,365 | |||
Lessee, Operating Lease, Term of Contract | 5 years | |||
Lessee, Operating Lease, Option to Extend | True | |||
Lessee, Operating Lease, Renewal Term | 3 years | |||
Operating Leases, Rent Expense | $ 572,767 | $ 462,711 | $ 461,246 | |
Operating Lease, Weighted Average Remaining Lease Term | 3 years 8 months 12 days | |||
Operating Lease, Weighted Average Discount Rate, Percent | 4.50% | |||
ASU 2016-02 | Restatement | ||||
Operating Lease Right-of-Use Asset | $ 994,000 | |||
Current Operating Lease Liability | 533,000 | |||
Long-term Operating Lease Liability | $ 461,000 |
Employee Benefit Plans (Additio
Employee Benefit Plans (Additional Information) (Details) - USD ($) | Jul. 02, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Employee Benefit Plans | ||||
Percentage Of Employee Deferrals | 100.00% | |||
Defined Contribution Plan, Employer Matching Contribution, Percent of Match | 3.00% | |||
Defined Contribution Plan, Cost | $ 142,414 | $ 100,188 | $ 0 |
Litigation - Additional Informa
Litigation - Additional Information (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Litigation | |
Loss Contingency, Damages Sought, Value | $ 80 |
Geographic and Other Financia_3
Geographic and Other Financial Information (Unaudited) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenue | $ 1,953,000 | $ 1,159,000 | $ 2,186,000 | $ 1,373,000 | $ 1,979,000 | $ 1,923,000 | $ 2,648,000 | $ 1,544,000 | $ 6,670,604 | $ 8,094,368 | $ 5,537,753 |
Geographic Concentration Risk 1 [Member] | |||||||||||
Revenue | $ 6,671,000 | $ 8,094,000 | $ 5,538,000 | ||||||||
Concentration Risk, Percentage | 100.00% | 100.00% | 100.00% | ||||||||
Geographic Concentration Risk 2 [Member] | |||||||||||
Revenue | $ 6,671,000 | $ 8,094,000 | $ 5,538,000 | ||||||||
Concentration Risk, Percentage | 100.00% | 100.00% | 100.00% | ||||||||
Asia Pacific [Member] | Geographic Concentration Risk 1 [Member] | |||||||||||
Revenue | $ 2,058,000 | $ 2,248,000 | $ 1,927,000 | ||||||||
Concentration Risk, Percentage | 31.00% | 28.00% | 35.00% | ||||||||
Europe [Member] | Geographic Concentration Risk 1 [Member] | |||||||||||
Revenue | $ 1,656,000 | $ 2,183,000 | $ 1,892,000 | ||||||||
Concentration Risk, Percentage | 25.00% | 27.00% | 34.00% | ||||||||
North America [Member] | Geographic Concentration Risk 1 [Member] | |||||||||||
Revenue | $ 2,781,000 | $ 3,550,000 | $ 1,687,000 | ||||||||
Concentration Risk, Percentage | 42.00% | 44.00% | 30.00% | ||||||||
Other Continent [Member] | Geographic Concentration Risk 1 [Member] | |||||||||||
Revenue | $ 176,000 | $ 113,000 | $ 32,000 | ||||||||
Concentration Risk, Percentage | 2.00% | 1.00% | 1.00% | ||||||||
Other Continent [Member] | Geographic Concentration Risk 2 [Member] | |||||||||||
Revenue | $ 1,363,000 | $ 2,849,000 | $ 2,054,000 | ||||||||
Concentration Risk, Percentage | 20.00% | 35.00% | 38.00% | ||||||||
China | Geographic Concentration Risk 2 [Member] | |||||||||||
Revenue | $ 984,000 | $ 17,000 | |||||||||
Concentration Risk, Percentage | 15.00% | 0.00% | 0.00% | ||||||||
US | Geographic Concentration Risk 2 [Member] | |||||||||||
Revenue | $ 2,673,000 | $ 3,475,000 | $ 1,618,000 | ||||||||
Concentration Risk, Percentage | 40.00% | 43.00% | 29.00% | ||||||||
Japan | Geographic Concentration Risk 2 [Member] | |||||||||||
Revenue | $ 873,000 | $ 1,261,000 | $ 1,340,000 | ||||||||
Concentration Risk, Percentage | 13.00% | 16.00% | 24.00% | ||||||||
Germany | Geographic Concentration Risk 2 [Member] | |||||||||||
Revenue | $ 778,000 | $ 492,000 | $ 526,000 | ||||||||
Concentration Risk, Percentage | 12.00% | 6.00% | 9.00% |
Quarterly Financial Informati_3
Quarterly Financial Information (Unaudited) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Quarterly Financial Information Unaudited [Abstract] | |||||||||||
Revenue | $ 1,953,000 | $ 1,159,000 | $ 2,186,000 | $ 1,373,000 | $ 1,979,000 | $ 1,923,000 | $ 2,648,000 | $ 1,544,000 | $ 6,670,604 | $ 8,094,368 | $ 5,537,753 |
Gross profit | (4,369,000) | (231,000) | 152,000 | 40,000 | 300,000 | 621,000 | 670,000 | 177,000 | (4,408,121) | 1,768,282 | (676,598) |
Net loss | $ (9,583,000) | $ (5,477,000) | $ (5,056,000) | $ (6,360,000) | $ (5,564,000) | $ (4,798,000) | $ (6,148,000) | $ (5,366,000) | $ (26,476,370) | $ (21,875,713) | $ (19,633,502) |
Net loss per share, basic and diluted | $ (0.31) | $ (0.18) | $ (0.20) | $ (0.25) | $ (0.22) | $ (0.19) | $ (0.24) | $ (0.22) | $ 0.94 | $ 0.87 | $ 1.02 |
Net loss attributable to common stockholders | $ (10,081,000) | $ (5,967,000) | $ (5,534,000) | $ (6,826,000) | $ (6,033,000) | $ (5,260,000) | $ (6,599,000) | $ (5,804,000) | $ (28,408,230) | $ (23,695,881) | $ (21,348,436) |
Schedule II - Valuation And Qua
Schedule II - Valuation And Qualification Accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Balance at Beginning of Period | $ 371 | $ 865 | $ 624 |
Charges to Expense | 4,566 | 310 | 241 |
Deductions | (149) | 0 | 0 |
Balance at End of Period | 4,788 | 371 | 865 |
Doubtful Accounts | |||
Balance at Beginning of Period | 7 | 29 | |
Charges to Expense | (7) | 7 | 29 |
Deductions | 0 | 0 | 0 |
Balance at End of Period | 0 | 7 | 29 |
Inventory | |||
Balance at Beginning of Period | 364 | 836 | 624 |
Charges to Expense | 4,573 | 303 | 212 |
Deductions | (149) | 0 | 0 |
Balance at End of Period | $ 4,788 | $ 364 | $ 836 |