Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2017 | |
Document and Entity Information [Abstract] | |
Entity Registrant Name | Aerkomm Inc. |
Entity Central Index Key | 1,590,496 |
Document Type | S1 |
Document Period End Date | Dec. 31, 2017 |
Current Fiscal Year End Date | --12-31 |
Entity Filer Category | Smaller Reporting Company |
Amendment Flag | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Current Assets | ||
Cash | $ 21,504 | $ 312,173 |
Inventories | 208,674 | 209,729 |
Prepaid expenses | 543,642 | 11,784 |
Other receivable - related party | 46,743 | |
Other receivable - others | 412,390 | 891 |
Other current assets | 6,591 | |
Total Current Assets | 1,239,544 | 534,577 |
Property and Equipment | ||
Cost | 405,319 | 128,917 |
Accumulated depreciation | (100,592) | (43,825) |
Property and equipment | 304,727 | 85,092 |
Construction in progress | 3,250,000 | 3,660,000 |
Net Property and Equipment | 3,554,727 | 3,745,092 |
Other Assets | ||
Intangible asset, net | 3,877,500 | 4,372,500 |
Goodwill | 1,450,536 | 1,105,942 |
Deposits - related party | 2,396 | 4,966 |
Deposits - others | 141,273 | 801,405 |
Total Other Assets | 5,471,705 | 6,284,813 |
Total Assets | 10,265,976 | 10,564,482 |
Current Liabilities | ||
Short-term bank loan | 10,000 | |
Accrued expenses | 637,675 | 71,978 |
Other payable - related parties | 1,082,395 | 2,955,575 |
Other payable - others | 2,081,787 | 1,671,269 |
Total Current Liabilities | 3,811,857 | 4,698,822 |
Restricted stock deposit liability | 56 | 3,342 |
Total Liabilities | 3,811,913 | 4,702,164 |
Commitments and Contingency | ||
Stockholders' Equity | ||
Preferred stock, no par value, as of December 31, 2017 and 2016, 10,000,000 shares authorized, none issued and outstanding. Preferred stock, $0.001 par value, as of December 31, 2017, 50,000,000 shares | ||
Common stock, no par value. Authorized - 210,000,000 shares. Issued and outstanding - 98,720,060 (excluding 6,683,340 unvested restricted shares) as of December 31, 2016. Common stock, $0.001 par value. Authorized - 450,000,000 shares. Issued and outstanding - 41,418,665 (excluding 41,432 unvested restricted shares) as of December 31, 2017 | 41,418 | 4,470,839 |
Additional paid in capital | 13,484,857 | 80,000 |
Subscribed capital | 75,040 | 1,862,643 |
Accumulated deficits | (7,143,788) | (551,204) |
Accumulated other comprehensive loss | (3,464) | (10) |
Total Stockholders' Equity | 6,454,063 | 5,862,268 |
Non-controlling interest in subsidiary | 50 | |
Total Equity | 6,454,063 | 5,862,318 |
Total Liabilities and Equity | $ 10,265,976 | $ 10,564,482 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2017 | Dec. 31, 2016 |
Stockholders' Equity | ||
Preferred stock, par value | $ 0.001 | |
Preferred stock, authorized | 50,000,000 | 10,000,000 |
Preferred stock, issued | ||
Preferred stock, outstanding | ||
Common stock, par value | $ 0.001 | |
Common stock, authorized | 450,000,000 | 210,000,000 |
Common stock, issued | 41,418,665 | 98,720,060 |
Common stock, outstanding | 41,418,665 | 98,720,060 |
Restricted stock | 41,432 | 6,683,340 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Loss - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Statement [Abstract] | |||
Net Sales | $ 6,128,900 | ||
Cost and Expenses | |||
Cost of sales | 1,337,905 | ||
Operating expenses | 7,147,597 | 3,970,105 | 1,235,796 |
Total Cost and Expenses | 7,147,597 | 3,970,105 | 2,573,701 |
Income (Loss) from Operations | (7,147,597) | (3,970,105) | 3,555,199 |
Net Non-Operating Income (Loss) | 23,652 | (89,559) | 15 |
Income (Loss) before Income Taxes | (7,123,945) | (4,059,664) | 3,555,214 |
Income Tax Expense (Benefit) | 8,519 | (883,200) | 884,800 |
Net Income (Loss) | (7,132,464) | (3,176,464) | 2,670,414 |
Less: Income (Loss) Attributed to Non-Controlling Interest | |||
Net Income (Loss) Attributable to the Company | (7,132,464) | (3,176,464) | 2,670,414 |
Other Comprehensive Loss | |||
Change in foreign currency translation adjustments | (3,454) | (10) | |
Total Comprehensive Income (Loss) | $ (7,135,918) | $ (3,176,474) | $ 2,670,414 |
Net Income (Loss) Per Common Share: | |||
Basic | $ (0.1748) | $ (0.0808) | $ 0.0841 |
Diluted | $ (0.1748) | $ (0.0808) | $ 0.0759 |
Weighted Average Shares Outstanding - Basic | 40,821,495 | 39,335,796 | 31,752,318 |
Weighted Average Shares Outstanding - Diluted | 40,821,495 | 39,335,796 | 35,190,236 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Equity - USD ($) | Total | Common Stock | Additional Paid in Capital | Subscribed Capital | Retained Earnings (Accumulated Deficits) | Accumulated Other Comprehensive Loss | Total Stockholders' Equity (Capital Deficiency) | Non Controlling Interest in Subsidiary |
Beginning Balance at Dec. 31, 2014 | $ (35,154) | $ 10,000 | $ (45,154) | $ (35,154) | ||||
Beginning Balance, Shares at Dec. 31, 2014 | 6,000,000 | |||||||
Issuance of common stock | 850,001 | $ 850,001 | 850,001 | |||||
Issuance of common stock, Shares | 343,673 | |||||||
Issuance of stock warrant | 20,000 | 20,000 | 20,000 | |||||
Restricted stock vested and transferred to common stock | 6,159 | $ 6,159 | 6,159 | |||||
Restricted stock vested and transferred to common stock, Shares | 1,231,667 | |||||||
Stock compensation expense | ||||||||
Net loss/income | 2,670,414 | 2,670,414 | 2,670,414 | |||||
Ending Balance at Dec. 31, 2015 | 3,511,420 | $ 866,160 | 20,000 | 2,625,260 | 3,511,420 | |||
Ending Balance, Shares at Dec. 31, 2015 | 7,575,340 | |||||||
Issuance of common stock | 3,600,395 | $ 3,600,395 | 3,600,395 | |||||
Issuance of common stock, Shares | 1,440,000 | |||||||
Issuance of stock warrant | 40,000 | 40,000 | 40,000 | |||||
Subscribed capital | 1,862,643 | 1,862,643 | 1,862,643 | |||||
Additional shares issued on stock split | ||||||||
Additional shares issued on stock split, Shares | 81,138,060 | |||||||
Restricted stock vested and transferred to common stock | 4,284 | $ 4,284 | 4,284 | |||||
Restricted stock vested and transferred to common stock, Shares | 8,566,660 | |||||||
Stock compensation expense | 20,000 | 20,000 | 20,000 | |||||
Net loss/income | (3,176,464) | (3,176,464) | (3,176,464) | |||||
Other comprehensive loss | (10) | (10) | (10) | |||||
Non-controlling interest in subsidiary | 50 | 50 | ||||||
Ending Balance at Dec. 31, 2016 | 5,862,268 | $ 4,470,839 | 80,000 | 1,862,643 | (551,204) | (10) | 5,862,268 | 50 |
Ending Balance, Shares at Dec. 31, 2016 | 98,720,060 | |||||||
Reverse acquisition | $ (4,433,221) | 5,756,024 | (1,862,643) | 539,880 | 10 | 50 | (50) | |
Reverse acquisition, Shares | (61,101,458) | |||||||
Issuance of common stock | 4,387,427 | $ 1,349 | 5,838,551 | (1,452,473) | 4,387,427 | |||
Issuance of common stock, Shares | 1,349,247 | |||||||
Issuance of stock warrant | 60,000 | 60,000 | 60,000 | |||||
Subscribed capital | 1,527,513 | 1,527,513 | 1,527,513 | |||||
Restricted stock vested and transferred to common stock | 3,287 | $ 2,451 | 836 | 3,287 | ||||
Restricted stock vested and transferred to common stock, Shares | 2,450,816 | |||||||
Stock compensation expense | 1,749,446 | 1,749,446 | 1,749,446 | |||||
Net loss/income | (7,132,464) | (7,132,464) | (7,132,464) | |||||
Other comprehensive loss | (3,464) | (3,464) | (3,464) | |||||
Ending Balance at Dec. 31, 2017 | $ 6,454,063 | $ 41,418 | $ 13,484,857 | $ 75,040 | $ (7,143,788) | $ (3,464) | $ 6,454,063 | |
Ending Balance, Shares at Dec. 31, 2017 | 41,418,665 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Cash Flows From Operating Activities | |||
Net income (loss) | $ (7,132,464) | $ (3,176,464) | $ 2,670,414 |
Adjustments to reconcile net income (loss) to net cash provided by (used for) operating activities: | |||
Depreciation and amortization | 551,767 | 526,460 | 94,444 |
Stock-based compensation | 1,749,446 | 20,000 | |
Changes in operating assets and liabilities: | |||
Accounts receivable - related party | 3,478,900 | (3,478,900) | |
Inventories | 1,055 | (97,674) | (111,000) |
Prepaid expenses | (521,949) | 116,327 | 25,066 |
Other receivable - related party | 162,335 | 116,180 | (116,180) |
Other receivable - others | (318) | 11,258 | |
Deposits - related party | 2,570 | (4,966) | |
Deposits - others | 660,132 | (382,534) | (389,320) |
Accrued expenses | 506,822 | (59,940) | 131,918 |
Other payable - related party | (2,373,180) | (1,638,890) | 3,224,263 |
Other payable - others | 392,299 | (133,759) | 1,043,737 |
Net Cash Provided by (Used for) Operating Activities | (6,001,485) | (1,225,102) | 3,094,442 |
Cash Flows from Investing Activities | |||
Prepaid investment | (700,000) | ||
Purchase of property and equipment | (273,015) | (3,686,597) | (78,508) |
Acquisitions of intangible assets | (4,950,000) | ||
Acquisitions of goodwill | (319,688) | ||
Net Cash Used for Investing Activities | (273,015) | (4,006,285) | (5,728,508) |
Cash Flows from Financing Activities | |||
Proceeds from short-term bank loan | 10,000 | ||
Proceeds from issuance of common stock | 4,387,428 | 3,600,395 | 864,452 |
Proceeds from subscribed capital | 1,527,513 | 1,862,643 | |
Issuance of stock warrant | 60,000 | 40,000 | |
Payments on repurchase of unvested restricted stock | (666) | ||
Contribution from non-controlling interest in subsidiary | 50 | ||
Net Cash Provided by Financing Activities | 5,984,941 | 5,502,422 | 864,452 |
Net Increase (Decrease) in Cash | (289,559) | 271,035 | (1,769,614) |
Cash from acquired subsidiaries | 2,354 | 21,650 | |
Cash, Beginning of Year | 312,173 | 19,498 | 1,789,112 |
Foreign currency translation effect on cash | (3,464) | (10) | |
Cash, End of Year | 21,504 | 312,173 | 19,498 |
Supplemental Disclosures of Cash Flow Information: | |||
Cash paid during the year for income taxes | 6,239 | 800 | |
Cash paid during the year for interest | 131 | ||
Non-cash operating, investing and financing activities: | |||
Construction in progress transferred to other receivable | 410,000 | ||
Restricted stock deposit liability transferred to common stock | 3,287 | 4,284 | 6,159 |
Other payable to related parties transferred to common stock | 2,027,400 | ||
Net payment for acquisition of subsidiaries | |||
Cash | 5,704 | 21,650 | |
Inventories | 1,055 | ||
Prepaid expenses | 16,500 | 2,784 | |
Other receivable - related party | 210,259 | ||
Other receivable - others | 12,149 | ||
Property and equipment, net | 5,152 | 6,642 | |
Goodwill | 344,594 | 1,105,942 | |
Other assets | 20,959 | ||
Accrued expenses | (60,640) | ||
Other payable | (518,219) | (151,131) | |
Non-controlling interest | (50) | ||
Total payment for acquisition of subsidiaries | 3,350 | 1,020,000 | |
Transferred from prepaid investment | (700,000) | ||
Net payment for acquisition of subsidiaries | $ 3,350 | $ 320,000 |
Organization
Organization | 12 Months Ended |
Dec. 31, 2017 | |
Organization [Abstract] | |
Organization | NOTE 1 - Organization Aerkomm Inc. (formerly Maple Tree Kids Inc.) (“Aerkomm”) was incorporated on August 14, 2013 in the State of Nevada. Aerkomm was a retail distribution company selling all of its products over the internet in the United States, operating in the infant and toddler products business market. On December 28, 2016, Aircom Pacific Inc. (“Aircom”) purchased 700,000 shares of Aerkomm’s common stock, representing approximately 86.3% of Aerkomm’s issued and outstanding common stock as of the closing date of purchase. As a result of the transaction, Aircom became the controlling shareholder of Aerkomm. On February 13, 2017, Aerkomm entered into a share exchange agreement (“Exchange Agreement”) with Aircom and its shareholders, pursuant to which Aerkomm acquired 100% of the issued and outstanding capital stock of Aircom in exchange for approximately 99.7% of the issued and outstanding capital stock of Aerkomm (or 87.81% on a fully-diluted basis). As a result of the share exchange, Aircom became a wholly-owned subsidiary of Aerkomm, and the former shareholders of Aircom became the holders of approximately 99.7% of Aerkomm’s issued and outstanding capital stock. Aircom was incorporated on September 29, 2014 under the laws of the State of California. On December 31, 2014, Aircom acquired a newly incorporated subsidiary, Aircom Pacific Ltd. (“Aircom Seychelles”), a corporation formed under the laws of the Republic of Seychelles. Aircom Seychelles was formed to facilitate Aircom’s global corporate structure for both business operations and tax planning. Presently, Aircom Seychelles has no operations. Aircom is working with corporate and tax advisers in finalizing its global corporate structure and has not yet concluded its final plan. On October 17, 2016, Aircom acquired a wholly owned subsidiary, Aircom Pacific Inc. Limited (“Aircom HK”), a corporation formed under the laws of Hong Kong. The purpose of Aircom HK is to conduct Aircom’s business and operations in Hong Kong and China. Presently, its primary function is business development, both with respect to airlines as well as content providers and advertisement partners based in Hong Kong and China. Aircom HK is also actively seeking strategic partnerships whom Aircom may leverage in order to provide more and better services to its customers. Aircom also plans to provide local supports to Hong Kong-based airlines via Aircom HK and teleports located in the Hong Kong and China regions. On December 15, 2016, Aircom acquired a wholly owned subsidiary, Aircom Japan, Inc. (“Aircom Japan”), a corporation formed under the laws of Japan. The purpose of Aircom Japan is to conduct business development and operations located within Japan. Aircom Japan is in the process of applying for, and will be the holder of, Satellite Communication Blanket License in Japan, which is necessary for Aircom to provide services within Japan. Aircom Japan will also provide local supports to airlines operating within the territory of Japan. Aircom Telecom LLC (“Aircom Taiwan”), which became a wholly owned subsidiary of Aircom in December 2017, was organized under the laws of Taiwan on June 29, 2016. During 2017, Aircom advanced a total of $460,000 to Aircom Taiwan, which was not affiliated with Aircom during that time, for working capital, as part of a planned $1,500,000 aggregate equity investment (the “Equity Investment”) in Aircom Taiwan. Before Aircom Taiwan was allowed to issue equity to Aircom, a foreign investor, the Equity Investment must be approved by the Investment Review Committee of the Ministry of Economic affairs of Taiwan (the “Committee”). Aircom entered into an Equity Pre-Subscription Agreement with Aircom Taiwan on August 13, 2017 to memorialize the terms of the Equity Investment. On December 19, 2017, the Committee approved Aircom’s initial Equity Investment (valued as of that date at NT$15,150,000, or approximately US$500,000) and the purchase of the founding owner’s total equity of NT$100,000 (approximately US$3,350). As a result, Aircom Taiwan became a wholly owned subsidiary of Aircom. Aircom Taiwan is responsible for Aircom’s business development efforts and general operations within Taiwan. We are currently planning to locate the site of our first ground station in Taiwan and we expect that if we raise sufficient funds to move forward with this project (although that cannot be guaranteed), Aircom Taiwan will play a significant role in building and operating that ground station. Aircom and its subsidiaries are full service providers of in-flight entertainment and connectivity solutions with their initial market in the Asian Pacific region. Aerkomm and its subsidiaries (“the Company”) have not generated significant revenues, excluding non-recurring revenues from affiliates in 2015, and will incur additional expenses as a result of being a public reporting company. If the Company is unable to obtain additional working capital, the Company’s business may fail. As of December 31, 2017, the Company incurred a comprehensive loss of $7,135,918 and had working capital deficiency of $2,572,313, which raises substantial doubt about its ability to continue as a going concern. Currently, the Company has taken measures that management believes will improve its financial position by financing activities, short-term borrowings and equity contributions. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2017 | |
Summary of Significant Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | NOTE 2 - Summary of Significant Accounting Policies Reverse Acquisition On February 13, 2017, Aerkomm completed the reverse acquisition of Aircom pursuant to the Exchange Agreement. As a result of the reverse acquisition, Aircom became Aerkomm’s wholly-owned subsidiary. For accounting purposes, the share exchange transaction with Aircom was treated as a reverse acquisition, with Aircom as the acquirer and Aerkomm as the acquired party. Unless the context suggests otherwise, “the Company” referred to for the periods prior to the consummation of the reverse acquisition is Aircom and its consolidated subsidiaries. Principle of Consolidation Aerkomm consolidates the accounts of its subsidiaries, Aircom, Aircom Seychelles, Aircom HK, Aircom Japan and Aircom Taiwan. All significant intercompany accounts and transactions have been eliminated in consolidation. All of the entities in these consolidated financial statements have adopted fiscal year-end of December 31. Reclassifications of Prior Year Presentation Certain prior year balance sheet amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations. Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results may differ from these estimates. Concentrations of Credit Risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash in banks and accounts receivable. As of December 31, 2017, 2016, and 2015, the total balances of cash in bank were insured by the Federal Deposit Insurance Corporation (FDIC) and foreign financial institution deposits insurance. The Company performs ongoing credit evaluation of its customers and requires no collateral. An allowance for doubtful accounts is provided based on a review of the collectability of accounts receivable. The Company determines the amount of allowance for doubtful accounts by examining the historical collection experience as well as its internal credit policies. The Company conducts extensive transactions with its related parties. Revenue for the year ended December 31, 2015 was solely from related parties. Inventories Inventories are recorded at the lower of weighted-average cost or net realizable value. The Company assesses the impact of changing technology on its inventory on hand and writes off inventories that are considered obsolete. Estimated losses on scrap and slow-moving items are recognized in the allowance for losses. Property and Equipment Property and equipment are stated at cost less accumulated depreciation. When value impairment is determined, the related assets are stated at the lower of fair value or book value. Significant additions, renewals and betterments are capitalized. Maintenance and repairs are expensed as incurred. Depreciation is computed by using the straight-line and double declining method over the following estimated service lives: computer equipment - 3 to 5 years, furniture and fixtures - 5 years and satellite equipment – 5 years. Construction costs for on-flight entertainment equipment not yet in service are recorded under construction in progress. Property and Equipment - continued Upon sale or disposal of property and equipment, the related cost and accumulated depreciation are removed from the corresponding accounts, with any gain or loss credited or charged to income in the period of sale or disposal. The Company reviews the carrying amount of property and equipment for impairment when events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. It determined that there was no impairment loss for each of the years in the three-year period ended December 31, 2017. Goodwill and Purchased Intangible Assets The Company’s goodwill represents the amount by which the total purchase price paid exceeded the estimated fair value of net assets acquired from acquisition of subsidiaries. The Company tests goodwill for impairment on an annual basis, or more often if events or circumstances indicate that there may be impairment. Purchased intangible assets with finite life are amortized on the straight-line basis over the estimated useful lives of respective assets. Purchased intangible assets with indefinite life are evaluated for impairment when events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Purchased intangible asset consists of satellite system software and is amortized over 10 years. Fair Value of Financial Instruments The Company utilizes the three-level valuation hierarchy for the recognition and disclosure of fair value measurements. The categorization of assets and liabilities within this hierarchy is based upon the lowest level of input that is significant to the measurement of fair value. The three levels of the hierarchy consist of the following: Level 1 - Inputs to the valuation methodology are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. Level 2 - Inputs to the valuation methodology are quoted prices for similar assets and liabilities in active markets, quoted prices in markets that are not active or inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the instrument. Level 3 - Inputs to the valuation methodology are unobservable inputs based upon management’s best estimate of inputs market participants could use in pricing the asset or liability at the measurement date, including assumptions. The carrying amounts of the Company’s cash, other receivable, short-term bank loan and other payable approximated their fair value due to the short-term nature of these financial instruments. Revenue Recognition The Company recognizes sales when the earning process is completed, as evidenced by an arrangement with the customer, transfer of title and acceptance, if applicable, has occurred, as well as the price is fixed or determinable, and collection is reasonably assured. Research and Development Costs Research and development costs are charged to operating expenses as incurred. For the years ended December 31, 2017, 2016 and 2015, the Company incurred approximately $336,000, $1,597,000 and $25,000 of research and development costs, respectively. Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are computed for differences between the financial statement and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Income tax expense is the tax payable or refundable for the period plus or minus the change during the period in deferred tax assets and liabilities. Adjustments to prior period’s income tax liabilities are added to or deducted from the current period’s tax provision. The Company follows FASB guidance on uncertain tax positions and has analyzed its filing positions in all the federal, state and foreign jurisdictions where it is required to file income tax returns, as well as all open tax years in those jurisdictions. The Company files income tax returns in the US federal, state and foreign jurisdictions where it conducts business. The Company believes that its income tax filing positions and deductions will be sustained on audit and does not anticipate any adjustments that will result in a material adverse effect on its consolidated financial position, results of operations, or cash flows. Therefore, no reserves for uncertain tax positions have been recorded. The Company does not expect its unrecognized tax benefits to change significantly over the next twelve months. The Company’s policy for recording interest and penalties associated with any uncertain tax positions is to record such items as a component of income before taxes. Penalties and interest paid or received, if any, are recorded as part of other operating expenses in the consolidated statement of operations. Translation Adjustments If a foreign subsidiary’s functional currency is the local currency, translation adjustments will result from the process of translating the subsidiary’s financial statements into the reporting currency of the Company. Such adjustments are accumulated and reported under other comprehensive income (loss) as a separate component of stockholder’s equity. Earnings (Loss) Per Share Basic earnings (loss) per share is computed by dividing income available to common shareholders by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share is computed by dividing income available to common shareholders by the weighted-average number of shares of common outstanding during the period increased to include the number of additional shares of common stock that would have been outstanding if the potentially dilutive securities had been issued. Potentially dilutive securities include stock warrants and outstanding stock options, shares to be purchased by employees under the Company’s employee stock purchase plan. Basic and diluted earnings (loss) per common share presented for the years ended December 31, 2017, 2016 and 2015 have taken into account the stock split in June 2016 and share exchange for reverse acquisition on February 13, 2017 (see Note 1). Subsequent Events The Company has evaluated events and transactions after the reported year-end up to March 12, 2018, the date on which these consolidated financial statements were available to be issued. All subsequent events requiring recognition as of December 31, 2017 have been included in these consolidated financial statements. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 12 Months Ended |
Dec. 31, 2017 | |
Recent Accounting Pronouncements [Abstract] | |
Recent Accounting Pronouncements | NOTE 3 - Recent Accounting Pronouncements Financial Instruments In January 2016, the FASB issued ASU No. 2016-01, “Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities” (“ASU 2016-01”), which updates certain aspects of recognition, measurement, presentation and disclosure of financial instruments. ASU 2016-01 will be effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company is currently evaluating the impact of adopting ASU 2016-01 on its consolidated financial statements. In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”), which modifies the measurement of expected credit losses of certain financial instruments. ASU 2016-13 will be effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The Company is currently evaluating the impact of adopting ASU 2016-13 on its consolidated financial statements. Intangibles In January 2017, the FASB issued ASU No. 2017-04, “Intangibles - Goodwill and Other” (Topic 350): Simplifying the Test for Goodwill Impairment, which goodwill shall be tested at least annually for impairment at a level of reporting referred to as a reporting unit. ASU 2017-04 will be effective for annual periods beginning after December 15, 2019. The Company is currently evaluating the impact of adopting ASU 2017-04 on its consolidated financial statements. Leases In February 2016, the FASB issued ASU No. 2016-02, “Leases” (Topic 842) (“ASU 2016-02”), which modifies lease accounting for both lessees and lessors to increase transparency and comparability by recognizing lease assets and lease liabilities by lessees for those leases classified as operating leases under previous accounting standards and disclosing key information about leasing arrangements. ASU 2016-02 will be effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, and early adoption is permitted. The Company is currently evaluating the timing of its adoption and the impact of adopting ASU 2016-02 on its consolidated financial statements. Revenue Recognition In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers” (Topic 606) (“ASU 2014-09”), which amends the existing accounting standards for revenue recognition. ASU 2014-09 is based on principles that govern the recognition of revenue at an amount an entity expects to be entitled when products are transferred to customers. ASU 2014-09 will be effective for annual periods beginning after December 15, 2017, and interim periods within that reporting period. Subsequently, the FASB issued the following standards related to ASU 2014-09: ASU No. 2016-08, “Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations” (“ASU 2016-08”); ASU No. 2016-10, “Revenue from Contracts with Customers” (Topic 606): Identifying “Performance Obligations and Licensing” (“ASU 2016-10”); and ASU No. 2016-12, “Revenue from Contracts with Customers” (Topic 606): “Narrow-Scope Improvements and Practical Expedients” (“ASU 2016-12”). The Company must adopt ASU 2016-08, ASU 2016-10 and ASU 2016-12 with ASU 2014-09 (collectively, the “new revenue standards”). The new revenue standards may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of adoption. The Company currently expects to adopt the new revenue standards in its first quarter of 2018 utilizing either a retrospective basic or modified retrospective basic method. The Company is currently evaluating the impact of adopting the new revenue standards on its consolidated financial statements. Income Taxes In October 2016, FASB issued ASU 2016-16, “Income Taxes (Topic 740): Intra-Entity Transfer of Assets Other than Inventory” (“ASU 2016-16”), which requires the recognition of the income tax consequences of an intra-entity transfer of an asset, other than inventory, when the transfer occurs. ASU 2016-06 will be effective for annual reporting periods beginning after December 15, 2017 and for the Company in its first quarter of 2018. The Company is currently evaluating the impact of adopting ASU 2016-16 on its consolidated financial statements. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2017 | |
Inventories [Abstract] | |
Inventories | NOTE 4 - Inventories As of December 31, 2017, and 2016, inventories consisted of the following: December 31, 2017 2016 Satellite equipment for sale under construction $ 197,645 $ 197,645 Parts 11,029 11,029 Supplies 5,540 6,437 214,214 215,111 Allowance for inventory loss (5,540 ) (5,382 ) Net $ 208,674 $ 209,729 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2017 | |
Property and Equipment [Abstract] | |
Property and Equipment | NOTE 5 - Property and Equipment For the years ended December 31, 2017 and 2016, the changes in cost of property and equipment were as follows: Computer Furniture and fixture Satellite Total January 1, 2016 92,285 3,393 - 95,678 Addition 26,626 6,613 - 33,239 December 31, 2016 118,911 10,006 - 128,917 Addition 992 - 275,410 276,402 December 31, 2017 $ 119,903 $ 10,006 $ 275,410 $ 405,319 As of December 31, 2016, construction in progress of $3,660,000 was the payment for the construction of ground station equipment relating to satellite communication system and in-flight system for the Company’s internal use. In 2017, one of the purchase contracts related to onboard equipment became undeliverable. Therefore, the Company reclassified the relevant payment of $410,000 recorded under construction in progress to other receivable. As a result, the balance of construction in progress was reduced to $3,250,000 as of December 31, 2017. For the years ended December 31, 2017 and 2016, the changes in accumulated depreciation for property and equipment were as follows: Computer software and equipment Furniture and fixture Satellite Total January 1, 2016 $ 12,082 $ 283 $ - $ 12,365 Addition 27,522 3,938 - 31,460 December 31, 2016 39,604 4,221 - 43,825 Addition 17,159 1,997 37,611 56,767 December 31, 2017 $ 56,763 $ 6,218 $ 37,611 $ 100,592 |
Intangible Asset, Net
Intangible Asset, Net | 12 Months Ended |
Dec. 31, 2017 | |
Intangible Asset, Net [Abstract] | |
Intangible Asset, Net | NOTE 6 - Intangible Asset, Net For the years ended December 31, 2017 and 2016, the changes in cost and accumulated amortization for intangible asset were as follows: Satellite Accumulated amortization Net Cost January 1, 2016 $ 4,950,000 $ 82,500 $ 4,867,500 Addition - 495,000 (495,000 ) December 31, 2016 4,950,000 577,500 4,372,500 Addition - 495,000 (495,000 ) December 31, 2017 $ 4,950,000 $ 1,072,500 $ 3,877,500 |
Short-Term Bank Loan
Short-Term Bank Loan | 12 Months Ended |
Dec. 31, 2017 | |
Short-Term Bank Loan [Abstract] | |
Short-term Bank Loan | NOTE 7 - Short-term Bank Loan The Company has an unsecured short-term bank credit line of $10,000, which will mature on June 14, 2018, from a local bank with an annual interest rate of 4.5% as of December 31, 2017. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2017 | |
Income Taxes [Abstract] | |
Income Taxes | NOTE 8 - Income Taxes Income tax expense (benefit) for the years ended December 31, 2017, 2016 and 2015 consisted of the following: 2017 2016 2015 Current: Federal $ 3,033 $ (884,000 ) $ 884,000 State 800 800 800 Foreign 4,686 - - Total $ 8,519 $ (883,200 ) $ 884,800 The following table presents a reconciliation of the income tax at statutory tax rate and the Company’s income tax at effective tax rate for the years ended December 31, 2017, 2016 and 2015. 2017 2016 2015 Tax expense (benefit) at statutory rate $ (2,292,820 ) $ (1,158,300 ) $ 987,000 Prepayment from related parties - (286,300 ) 286,300 Net operating loss carryforwards (NOLs) 1,760,600 717,600 (345,000 ) Stock-based compensation expense 594,800 8,000 - Amortization expense (11,200 ) (168,300 ) (28,100 ) Others (42,861 ) 4,100 (15,400 ) Tax (benefit) at effective tax rate $ 8,519 $ (883,200 ) $ 884,800 Deferred tax assets (liability) as of December 31, 2017 and 2016 consist of: 2017 2016 Net operating loss carryforwards (NOLs) $ 2,057,000 $ 519,000 Stock-based compensation expense 489,000 8,000 Accrued expenses and unpaid payable 443,000 35,000 Tax credit carryforwards 68,000 63,000 Excess of tax amortization over book amortization (658,000 ) (230,000 ) 2,399,000 395,000 Valuation allowance (2,399,000 ) (395,000 ) Net $ - $ - Management does not believe the deferred tax assets will be utilized in the near future; therefore, a full valuation allowance is provided. The net change in deferred tax assets valuation allowance was an increase of $2,004,000, $9,000 and $371,000 for the years ended December 31, 2017, 2016 and 2015, respectively. As a result of the Tax Cuts and Jobs Act signed into law in December 2017, the U.S. federal corporate income tax rate is reduced to 21 percent, effective January 1, 2018. Consequently, the Company has recorded a decrease related to its deferred tax assets of $48,000. Since the Company reserved full valuation allowance to its deferred tax assets, there was no impact on income tax expense for the year ended December 31, 2017. As of December 31, 2017, the Company had federal NOLs and State NOLs of approximately $6,686,000 and $7,897,000, respectively, available to reduce future federal and state taxable income, expiring in 2037. As of December 31, 2016, the Company has Japan NOLs of approximately $326,000 available to reduce future Japan taxable income, expiring in 2019. As of December 31, 2017, the Company had approximately $37,000 of federal research and development tax credit, available to offset future federal income tax. The credit begins to expire in 2034 if not utilized. As of December 31, 2017, the Company had approximately $39,000 of California state research and development tax credit available to offset future California state income tax. The credit can be carried forward indefinitely. The Company’s ability to utilize its federal and state NOLs to offset future income taxes is subject to restrictions resulting from its prior change in ownership as defined by Internal Revenue Code Section 382. The Company does not expect to incur the limitation on NOLs utilization in future annual usage. |
Capital Stock
Capital Stock | 12 Months Ended |
Dec. 31, 2017 | |
Capital Stock [Abstract] | |
Capital Stock | NOTE 9 - Capital Stock 1) Preferred Stock: The Company is authorized to issue 50,000,000 shares of preferred stock, with par value of $0.001. As of December 31, 2017, there were no preferred stock shares outstanding. The Board of Directors has the authority to issue preferred stock in one or more series, and in connection with the creation of any such series, by resolutions providing for the issuance of the shares thereof, to determine dividends, voting rights, conversion rights, redemption privileges and liquidation preferences. 2) Common Stock: The Company is authorized to issue 450,000,000 shares of common stock, with par value of $0.001. Aircom had restricted stock purchase agreement with certain employees or consultants with 2,890,000 shares granted on February 2, 2015. The restricted shares were issued at fair values determined by the board of directors at the grant date. According to the agreement, in the event of the voluntary termination of purchaser’s continuous service status, Aircom shall have the exclusive option to repurchase all or any portion of the unvested shares held by purchaser at the original purchase price per share and the vested shares held by purchaser at the fair market value per share as of the termination date. In February and June 2016, Aircom purchased back 133,333 unvested shares of restricted stock at $0.005 per share from terminated employees before the stock split. In June 2016, the restricted stock was split to 27,566,670 shares. On February 13, 2017, all of Aircom’s 27,566,670 restricted shares were converted to Aerkomm’s restricted stock of 10,279,738 shares at the ratio of 2.681651 to 1, pursuant to the Exchange Agreement (see Note 1). As of December 31, 2017 and 2016, the restricted shares (after share exchange) consisted of the following: December 31, 2017 2016 Restricted stock - vested 10,238,300 7,787,490 Restricted stock - unvested 41,438 2,492,248 Total restricted stock 10,279,738 10,279,738 The unvested shares of restricted stock were recorded under deposit liability account awaiting future conversion to common stock when they become vested. On March 31, 2017, the Company completed its private placement offering of 500,000 shares of common stock at a price of $3.00 per share for the aggregate amount of $1,500,000. On June 6, 2017, the Company completed its private placement offering of 60,000 shares of common stock at a price of $5.00 per share for the aggregate amount of $300,000. Additionally, on June 6, 2017, pursuant to a settlement and release agreement with Priceplay Taiwan Inc. (“PPTW”) dated March 31, 2017, among the Company, PPTW and Aircom, the Company issued 163,860 shares of its common stock to PPTW in settlement of an outstanding $819,300 obligation of Aircom to PPTW. Additionally, pursuant to a similar settlement and release agreement with Priceplay.com, Inc. (“PPUS”) dated March 31, 2017, the Company issued 147,400 shares of its common stock to PPUS in settlement of an outstanding $737,000 obligation of Aircom to PPUS, and pursuant to a third similar settlement and release agreement with Aircom and dMobile System Co. ltd. (dMobile), it issued 94,220 shares of its common stock to dMobile in settlement of an outstanding $471,100 obligation of Aircom to dMobile. In the aggregate, the Company has issued 405,480 shares to the three settlement recipients at a price of $5.00 per share for a total of $2,027,400. Including the 60,000 shares sold to individuals in the private offering, the Company issued 465,480 shares in total for an aggregate of $2,327,400. On July 5, 2017, the Company completed its first closing of a private placement offering in which it sold 5,000 shares of its common stock to Daniel Shih, the Company’s co-founder, at a price of $5.50 per share for a total of $27,500. The Company conducted additional closings in July and August for a total of $517,413. As of October 31, 2017, the total subscribed capital amounted to $544,913. On October 31, 2017, the Company completed this private placement offering of 264,086 shares of common stock at a price of $5.50 per share for the aggregate amount of $1,452,473. On November 27, 2017, the Company completed its first closing of another private placement offering in which 13,400 shares of its common stock were subscribed by Daniel Shih, the Company’s co-founder, at a price of $5.60 per share for a total of $75,040. The Company is offering a total of 892,857 shares of its common stock at a price of $5.60 per share in this offering for the aggregate amount of $5,000,000 and will pursue additional closings up to that aggregate amount through March 31, 2018. On November 30, 2017, the Company issued 80,000 and 20,000 shares of its common stock to Integra Consulting Group LLC (“Integra”) and Anthony D. Altavilla, principal of Integra, respectively, according to the Consulting Agreement signed on November 15, 2017 between the Company and Integra. 3) Stock Warrant: As of December 31, 2016, Aircom had issued stock warrants exercisable for $60,000 in value of its common stock to a service provider as payment for services. The stock warrants allow the service provider to purchase a number of shares of Aircom common stock equal $60,000 divided by 85% of the share price paid by investors for Aircom’s common stock in the first subsequent qualifying equity financing event, at an exercise price of $0.01 per share. On February 13, 2017, these stock warrants were converted to Aerkomm’s stock warrants pursuant to the Exchange Agreement (see Note 1). For the year ended December 31, 2017, Aerkomm issued additional stock warrants exercisable for $60,000 in value of Aerkomm common stock to the service provider as payment for additional services. As of December 31, 2017, the Company cumulatively recorded $120,000 as additional paid-in capital in total with respect to these warrants. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 10 - Related Party Transactions A. Name of related parties and relationships with the Company: Related Party Relationship Daniel Shih (Daniel) * Co-founder/promoter and shareholder; Aircom’s CEO and Director between February 13, 2017 and April 26, 2017; Aircom’s CFO between February 13, 2017 and May 5, 2017 Bummy Wu Shareholder Yih Lieh (Giretsu) Shih President of Aircom Japan Hao Wei Peng Employee of Aircom Taiwan dMobile System Co. Ltd. (dMobile) Daniel is the Chairman Klingon Aerospace, Inc. (Klingon) Daniel was the Chairman from February 2015 to February 2016 Law Office of Jan Yung Lin 100% owned by Jan Yung Lin (Director) Priceplay.com, Inc. (PPUS) Daniel is the Chairman Priceplay Taiwan Inc. (PPTW) Parent of PPUS Wealth Wide Int’l Ltd. (WWI) Bummy Wu is the Chairman Yun Shu Chiou Former CEO and President * Daniel has relinquished “beneficial ownership” of substantially all of his equity interests in the Company (whether held directly or indirectly) in a manner acceptable to the Company. This means that Daniel no longer, directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise has or shares (i) voting power, which includes the power to vote, or to direct the voting of, securities, and/or (ii) investment power, which includes the power to dispose, or to direct the disposition of, shares of our common stock, except for a de minimus number of shares of the common stock which will continue to be beneficially owned by him by way of his being a control person in another entity that owns shares of the common stock. Daniel will, however, retain a pecuniary interest in some of the shares of the common stock over which he has relinquished voting and investment power. Daniel has also removed himself from any and all activities relating to the Company’s business, including, but not limited to managerial, directional, advisory, promotional, developmental and fund-raising activities, effective upon the effectiveness of the registration statement on Form S-1 filed with the SEC on December 20, 2017, as amended to date. Additionally, Barbie Shih (Barbie), Daniel’s wife, was not re-elected to our board of directors on December 29, 2017. As a result of these events, neither Daniel nor Barbie will maintain any active affiliation with, or material beneficial ownership interest in, the Company. B. Significant related party transactions: The Company has extensive transactions with its related parties. It is possible that the terms of these transactions are not the same as those which would result from transactions among wholly unrelated parties. a. As of December 31, 2017 and 2016, December 31, 2017 2016 Other receivable from Hao Wei Peng 1 $ 46,743 $ - Rental deposit to Daniel $ 2,396 $ 4,966 Other payable to: Klingon 2 762,000 762,000 Daniel 3 128,543 49,500 Yih Lieh (Giretsu) Shih 3 76,600 69,385 WWI 4 9,410 - PPTW - 819,300 PPUS - 737,000 dMobile - 471,100 Bummy Wu - 32,149 Others 3 105,842 15,141 Total $ 1,082,395 $ 2,955,575 1. Represents receivable from Mr. Peng due to the transactions prior to the acquisition of Aircom Telecom on December 19, 2017. The amount is subsequently collected on January 4, 2018. 2. On March 9, 2015, the Company entered into a 10-year purchase agreement with Klingon. In accordance with the terms of this agreement, Klingon agreed to purchase from the Company an initial order of onboard equipment comprising an onboard system for a purchase price of $909,000, with payments to be made in accordance with a specific milestones schedule. As of December 31, 2017 and 2016, the Company received $762,000 from Klingon in milestone payments towards the equipment purchase price. Since the project might not be successful, the Company reclassified the balance from customer prepayment to other payable due to uncertainty. 3. Represents payable to employees as a result of regular operating activities. 4. Represents rent for a warehouse in Hong Kong to store the Company’s hardware. b. For the years ended December 31, 2017, 2016 and 2015, Year Ended December 31, 2017 2016 2015 Sales to dMobile $ - $ - $ 5,478,900 PPUS - - 650,000 Total $ - $ - $ 6,128,900 100% of the Company’s sales for the year ended December 31, 2015 were to related parties. Year Ended December 31, 2017 2016 2015 Intangible purchase from dMobile $ - $ - $ 4,950,000 Legal expense paid to Law Office of Jan Yung Lin $ - $ 10,000 $ 51,431 Consulting expense paid to Yun Shu Chiou $ 55,000 $ - $ - Rental expense charged by Daniel $ 20,232 $ - $ - Rental expense charged by WWI $ 3,150 $ - $ - Aircom Japan entered into a lease agreement with Daniel, between August 1, 2014 and July 31, 2016, which was renewed to expire on July 31, 2018. Pursuant to the terms of this lease agreement, Aircom Japan pays Daniel a rental fee of approximately $1,200 per month. The Company has a lease agreement with WWI with monthly rental cost of $450. The lease term is from June 1, 2017 to May 31, 2018. |
Stock Based Compensation
Stock Based Compensation | 12 Months Ended |
Dec. 31, 2017 | |
Stock Based Compensation [Abstract] | |
Stock Based Compensation | NOTE 11 - Stock Based Compensation In March 2014, Aircom’s Board of Directors adopted the 2014 Stock Option Plan (the “Aircom 2014 Plan”). The Aircom 2014 Plan provides for the granting of incentive stock options and non-statutory stock options to employees, consultants and outside directors of Aircom. Options granted under the Plan may be Incentive Stock Options or Nonstatutory Stock Options, as determined by the Administrator at the time of grant of an Option. On February 13, 2017, pursuant to the Exchange Agreement, Aerkomm assumed the options of Aircom 2014 Plan and agreed to issue options for an aggregate of 5,444,407 shares to Aircom’s stock option holders. One-third of Aircom 2014 Plan stock option shares will be vested as of the first anniversary of the time the option shares are granted or the employee’s acceptance to serve the Company, and 1/36th of the shares will be vested each month thereafter. Option price is determined by the Board of Directors. The Plan shall become effective upon its adoption by the Board and shall continue in effect for a term of 10 years unless sooner terminated under the terms of Aircom 2014 Plan. On May 5, 2017, the Board of Directors of Aerkomm adopted the Aerkomm Inc. 2017 Equity Incentive Plan (the “Aerkomm 2017 Plan” or, the “Plan”) and the reservation of 5,000,000 shares of the Company’s common stock for issuance under the Plan. On June 23, 2017, the Board of Directors voted to increase the number of shares of the Company’s common stock reserved for issuance under the Plan to 10,000,000 shares. The Aerkomm 2017 Plan provides for the granting of incentive stock options and non-statutory stock options to employees, consultants and outside directors of Aircom. Options granted under the Plan may be Incentive Stock Options or Nonstatutory Stock Options, as determined by the Administrator at the time of grant of an option. On June 23, 2017, the Board of Directors agreed to issue options for an aggregate of 1,455,000 shares under the Aerkomm 2017 Plan to certain officers and directors of Aerkomm. The option agreements granted on June 23, 2017 are classified into three types of vesting schedule, which includes, 1) 1/6 of the shares subject to the option shall vest commencing on the vesting start date and the remaining shares shall vest at the rate of 1/60 for the next 60 months on the same day of the month as the vesting start date; 2) 1/4 of the shares subject to the option shall vest commencing on the vesting start date and the remaining shares shall vest at the rate of 1/36 for the next 36 months on the same day of the month as the vesting start date; 3) 1/3 of the shares subject to the option shall vest commencing on the first anniversary of vesting start date and the remaining shares shall vest at the rate of 50% each year for the next two years on the same day of the month as the vesting start date. Option price is determined by the Board of Directors. The Plan has been adopted by the Board and shall continue in effect for a term of 10 years unless sooner terminated under the terms of Aerkomm 2017 Plan. The Plan has not yet been approved by Aerkomm’s stockholders. Valuation and Expense Information Measurement and recognition of compensation expense based on estimated fair values is required for all share-based payment awards made to its employees and directors including employee stock options. The Company recognized compensation expense of $1,749,447, $20,000 and $0 for the years ended December 31, 2017, 2016 and 2015, respectively, related to such employee stock options. Determining Fair Value Valuation and amortization method The Company uses the Black-Scholes option-pricing-model to estimate the fair value of stock options granted on the date of grant or modification and amortizes the fair value of stock-based compensation at the date of grant on a straight-line basis for recognizing stock compensation expense over the vesting period of the option. Expected term The expected term is the period of time that granted options are expected to be outstanding. The Company uses the SEC’s simplified method for determining the option expected term based on the Company’s historical data to estimate employee termination and options exercised. Expected dividends The Company does not plan to pay cash dividends before the options are expired. Therefore, the expected dividend yield used in the Black-Scholes option valuation model is zero. Expected volatility Since the Company has no historical volatility, it used the calculated value method which substitutes the historical volatility of a public company in the same industry to estimate the expected volatility of the Company’s share price to measure the fair value of options granted under Aircom 2014 Plan and Aerkomm 2017 Plan. Risk-free interest rate The Company based the risk-free interest rate used in the Black-Scholes option valuation model on the market yield in effect at the time of option grant provided in the Federal Reserve Board’s Statistical Releases and historical publications on the Treasury constant maturities rates for the equivalent remaining terms for Aircom 2014 Plan and Aerkomm 2017 Plan. Forfeitures The Company is required to estimate forfeitures at the time of grant and revises those estimates in subsequent periods if actual forfeitures differ from those estimates. The Company uses historical data to estimate option forfeitures and records share-based compensation expense only for those awards that are expected to vest. The Company used the following assumptions to estimate the fair value of options granted in 2017 and 2016 under Aircom 2014 Plan and Aerkomm 2017 Plan as follows: Assumptions Expected term 3 - 5 years Expected volatility 40.11% - 59.18% Expected dividends 0% Risk-free interest rate 0.71 – 2.40% Forfeiture rate 0% - 5% Aircom 2014 Plan Number of shares Weighted Average Exercise Price Per Share Weighted Average Fair Value Per Share Options outstanding at January 1, 2016 4,139,241 $ 0.0013 $ 0.0004 Granted 1,305,166 0.6704 0.2108 Exercised - - - Forfeited/Cancelled - - - Options outstanding at December 31, 2016 5,444,407 0.1617 0.0508 Granted - - Exercised (19,681 ) 0.0013 0.0004 Forfeited/Cancelled (763,418 ) 0.6550 0.2059 Options outstanding at December 31, 2017 4,661,307 0.0816 0.0256 Options exercisable at December 31, 2016 2,066,858 0.0013 0.0004 Options exercisable at December 31, 2017 3,148,972 0.0412 0.0129 A summary of the status of nonvested shares under Aircom 2014 Plan as of December 31, 2017 and 2016 was as follows: Number of Shares Weighted Per Share Options nonvested at January 1, 2016 4,139,241 $ 0.0013 Granted 1,305,166 0.6704 Vested (2,066,858 ) 0.0013 Forfeited/Cancelled - - Options nonvested at December 31, 2016 3,377,549 0.2597 Granted - - Vested (1,101,795 ) 0.1146 Forfeited/Cancelled (763,418 ) 0.6550 Options nonvested at December 31, 2017 1,512,335 0.1663 Aerkomm 2017 Plan A summary of the number of shares, weighted average exercise price and estimated fair value of options under Aerkomm 2017 Plan as of December 31, 2017 was as follows: Number of Shares Weighted Average Exercise Price Per Share Weighted Average Fair Value Per Share Options outstanding at January 1, 2017 - $ - $ - Granted 2,060,000 5.9154 3.5401 Exercised - - - Forfeited/Cancelled (795,000 ) 5.5000 3.2922 Options outstanding at December 31, 2017 1,265,000 6.1765 3.6959 Options exercisable at December 31, 2017 423,750 5.5708 3.4005 A summary of the status of nonvested shares under Aerkomm 2017 Plan as of December 31, 2017 was as follows: Number of Shares Weighted Average Exercise Price Per Share Options nonvested at January 1, 2017 - $ - Granted 2,060,000 5.9154 Forfeited/Cancelled (795,000 ) 5.5000 Options nonvested at December 31, 2017 841,250 6.4816 As of December 31, 2017, 2016 and 2015, there were approximately $5,057,000, $94,000 and $2,000, respectively, of total unrecognized compensation cost related to nonvested share-based compensation arrangements granted under Aircom 2014 Plan and Aerkomm 2017 Plan. Total unrecognized compensation cost will be adjusted for future changes in estimated forfeitures. The Company expects to recognize that cost over a weighted average period of 1 - 5 years. |
Commitments and Contingency
Commitments and Contingency | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingency [Abstract] | |
Commitments and Contingency | NOTE 12 - Commitments and Contingency As of December 31, 2017, the Company’s significant commitments with non-related parties and contingency are summarized as follows: Commitments 1) The Company’s lease for its office in Fremont, California expired in May 2017, it was renewed and to expire in May 2020. Rental expense was $71,152, $62,472 and $39,045 for the years ended December 31, 2017, 2016 and 2015, respectively. As of December 31, 2017, future minimum lease payment obligation is approximately $77,000, $77,000 and $32,000 for 2018, 2019 and 2020, respectively. 2) The Company has another lease for its Japan office expiring July 2018. Rental expense was approximately $55,043 for the year ended December 31, 2017. As of December 31, 2017, future minimum lease payment obligation is $18,700, including the 8% Japan consumption tax, for 2018 until its expiration. 3) The Company assumed a lease for its Taiwan office expiring October 31, 2018 as a result of the acquisition of Aircom Taiwan. Monthly rental expense is NT$236,250 (approximately $8,000). As of December 31, 2017, future minimum lease payment obligation is NT$2,362,500 (approximately $80,000) for 2018 until its expiration. 4) In March 2017, the Company entered into a satellites service agreement (the Agreement) with a Japanese company (Company J). The agreement is effective on March 15, 2017 and will expire three years from the effective date. According to the Agreement, the Company shall prepay the total amount of $285,300 and the deposit of $95,100 on April 15, 2017. The prepayment of $285,300 shall be applied to monthly service charge by Company J based on the terms defined in the Agreement. Contingency The Company entered into a 3-year digital transmission service agreement with Asia Satellite Telecommunication Company Limited (“Asia Sat”) on July 25, 2015. As of March 31, 2017, Asia Sat stipulates that the Company is in debt of $8,013,495 to Asia Sat, which includes unpaid service fees, a default payment in the form of liquidated sum and interest. The default payment includes total future payments of $7,411,616 due through March 31, 2018, subtracting the deposit of $775,000 made to Asia Sat. The Company disagreed with the payable balance of $8,013,495 and had recorded $1,376,879 payable to Asia Sat as of March 31, 2017. On July 25, 2016, Asia Sat commenced arbitration against the Company. On November 21, 2016, the Hong Kong International Arbitration Centre (“HKIAC”) appointed a sole arbitrator to hear the dispute. On January 12, 2017, the Company introduced a counterclaim for misrepresentations made to induce entry into the Agreement. Aircom and AsiaSat reached a settlement with respect to the Agreement as of July 25, 2017, with an effective date of July 20, 2017. As of December 31, 2017, the Company has accrued the settlement liability and accounted for the net impact of the settlement. |
Summary of Significant Accoun19
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Summary of Significant Accounting Policies [Abstract] | |
Reverse Acquisition | Reverse Acquisition On February 13, 2017, Aerkomm completed the reverse acquisition of Aircom pursuant to the Exchange Agreement. As a result of the reverse acquisition, Aircom became Aerkomm’s wholly-owned subsidiary. For accounting purposes, the share exchange transaction with Aircom was treated as a reverse acquisition, with Aircom as the acquirer and Aerkomm as the acquired party. Unless the context suggests otherwise, “the Company” referred to for the periods prior to the consummation of the reverse acquisition is Aircom and its consolidated subsidiaries. |
Principle of Consolidation | Principle of Consolidation Aerkomm consolidates the accounts of its subsidiaries, Aircom, Aircom Seychelles, Aircom HK, Aircom Japan and Aircom Taiwan. All significant intercompany accounts and transactions have been eliminated in consolidation. All of the entities in these consolidated financial statements have adopted fiscal year-end of December 31. |
Reclassifications of Prior Year Presentation | Reclassifications of Prior Year Presentation Certain prior year balance sheet amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results may differ from these estimates. |
Concentrations of Credit Risk | Concentrations of Credit Risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash in banks and accounts receivable. As of December 31, 2016, and 2015, the total balances of cash in bank were insured by the Federal Deposit Insurance Corporation (FDIC) and foreign financial institution deposits insurance. The Company performs ongoing credit evaluation of its customers and requires no collateral. An allowance for doubtful accounts is provided based on a review of the collectability of accounts receivable. The Company determines the amount of allowance for doubtful accounts by examining the historical collection experience as well as its internal credit policies. The Company conducts extensive transactions with its related parties. Revenue for the year ended December 31, 2015 was solely from related parties. |
Inventories | Inventories Inventories are recorded at the lower of weighted-average cost or net realizable value. The Company assesses the impact of changing technology on its inventory on hand and writes off inventories that are considered obsolete. Estimated losses on scrap and slow-moving items are recognized in the allowance for losses. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost less accumulated depreciation. When value impairment is determined, the related assets are stated at the lower of fair value or book value. Significant additions, renewals and betterments are capitalized. Maintenance and repairs are expensed as incurred. Depreciation is computed by using the straight-line and double declining method over the following estimated service lives: computer equipment - 3 to 5 years, furniture and fixtures - 5 years and satellite equipment – 5 years. Construction costs for on-flight entertainment equipment not yet in service are recorded under construction in progress. Upon sale or disposal of property and equipment, the related cost and accumulated depreciation are removed from the corresponding accounts, with any gain or loss credited or charged to income in the period of sale or disposal. The Company reviews the carrying amount of property and equipment for impairment when events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. It determined that there was no impairment loss for each of the years in the three-year period ended December 31, 2017. |
Goodwill and Purchased Intangible Assets | Goodwill and Purchased Intangible Assets The Company’s goodwill represents the amount by which the total purchase price paid exceeded the estimated fair value of net assets acquired from acquisition of subsidiaries. The Company tests goodwill for impairment on an annual basis, or more often if events or circumstances indicate that there may be impairment. Purchased intangible assets with finite life are amortized on the straight-line basis over the estimated useful lives of respective assets. Purchased intangible assets with indefinite life are evaluated for impairment when events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Purchased intangible asset consists of satellite system software and is amortized over 10 years. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company utilizes the three-level valuation hierarchy for the recognition and disclosure of fair value measurements. The categorization of assets and liabilities within this hierarchy is based upon the lowest level of input that is significant to the measurement of fair value. The three levels of the hierarchy consist of the following: Level 1 - Inputs to the valuation methodology are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. Level 2 - Inputs to the valuation methodology are quoted prices for similar assets and liabilities in active markets, quoted prices in markets that are not active or inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the instrument. Level 3 - Inputs to the valuation methodology are unobservable inputs based upon management’s best estimate of inputs market participants could use in pricing the asset or liability at the measurement date, including assumptions. The carrying amounts of the Company’s cash, other receivable, short-term bank loan and other payable approximated their fair value due to the short-term nature of these financial instruments. |
Revenue Recognition | Revenue Recognition The Company recognizes sales when the earning process is completed, as evidenced by an arrangement with the customer, transfer of title and acceptance, if applicable, has occurred, as well as the price is fixed or determinable, and collection is reasonably assured. |
Research and Development Costs | Research and Development Costs Research and development costs are charged to operating expenses as incurred. For the years ended December 31, 2017, 2016 and 2015, the Company incurred approximately $336,000, $1,597,000 and $25,000 of research and development costs, respectively. |
Income Taxes | Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are computed for differences between the financial statement and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Income tax expense is the tax payable or refundable for the period plus or minus the change during the period in deferred tax assets and liabilities. Adjustments to prior period’s income tax liabilities are added to or deducted from the current period’s tax provision. The Company follows FASB guidance on uncertain tax positions and has analyzed its filing positions in all the federal, state and foreign jurisdictions where it is required to file income tax returns, as well as all open tax years in those jurisdictions. The Company files income tax returns in the US federal, state and foreign jurisdictions where it conducts business. The Company believes that its income tax filing positions and deductions will be sustained on audit and does not anticipate any adjustments that will result in a material adverse effect on its consolidated financial position, results of operations, or cash flows. Therefore, no reserves for uncertain tax positions have been recorded. The Company does not expect its unrecognized tax benefits to change significantly over the next twelve months. The Company’s policy for recording interest and penalties associated with any uncertain tax positions is to record such items as a component of income before taxes. Penalties and interest paid or received, if any, are recorded as part of other operating expenses in the consolidated statement of operations. |
Translation Adjustments | Translation Adjustments If a foreign subsidiary’s functional currency is the local currency, translation adjustments will result from the process of translating the subsidiary’s financial statements into the reporting currency of the Company. Such adjustments are accumulated and reported under other comprehensive income (loss) as a separate component of stockholder’s equity. |
Earnings (Loss) Per Share | Earnings (Loss) Per Share Basic earnings (loss) per share is computed by dividing income available to common shareholders by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share is computed by dividing income available to common shareholders by the weighted-average number of shares of common outstanding during the period increased to include the number of additional shares of common stock that would have been outstanding if the potentially dilutive securities had been issued. Potentially dilutive securities include stock warrants and outstanding stock options, shares to be purchased by employees under the Company’s employee stock purchase plan. Basic and diluted earnings (loss) per common share presented for the years ended December 31, 2017, 2016 and 2015 have taken into account the stock split in June 2016 and share exchange for reverse acquisition on February 13, 2017 (see Note 1). |
Subsequent Events | Subsequent Events The Company has evaluated events and transactions after the reported year-end up to March 12, 2018, the date on which these consolidated financial statements were available to be issued. All subsequent events requiring recognition as of December 31, 2017 have been included in these consolidated financial statements. |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Inventories [Abstract] | |
Schedule of inventories | December 31, 2017 2016 Satellite equipment for sale under construction $ 197,645 $ 197,645 Parts 11,029 11,029 Supplies 5,540 6,437 214,214 215,111 Allowance for inventory loss (5,540 ) (5,382 ) Net $ 208,674 $ 209,729 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Property and Equipment [Abstract] | |
Schedule of changes in cost of property and equipment | Computer Furniture and fixture Satellite Total January 1, 2016 92,285 3,393 - 95,678 Addition 26,626 6,613 - 33,239 December 31, 2016 118,911 10,006 - 128,917 Addition 992 - 275,410 276,402 December 31, 2017 $ 119,903 $ 10,006 $ 275,410 $ 405,319 |
Schedule of changes in accumulated depreciation for property and equipment | Computer software and equipment Furniture and fixture Satellite Total January 1, 2016 $ 12,082 $ 283 $ - $ 12,365 Addition 27,522 3,938 - 31,460 December 31, 2016 39,604 4,221 - 43,825 Addition 17,159 1,997 37,611 56,767 December 31, 2017 $ 56,763 $ 6,218 $ 37,611 $ 100,592 |
Intangible Asset, Net (Tables)
Intangible Asset, Net (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Intangible Asset, Net [Abstract] | |
Schedule of changes in cost and accumulated amortization for intangible asset | Satellite Accumulated amortization Net Cost January 1, 2016 $ 4,950,000 $ 82,500 $ 4,867,500 Addition - 495,000 (495,000 ) December 31, 2016 4,950,000 577,500 4,372,500 Addition - 495,000 (495,000 ) December 31, 2017 $ 4,950,000 $ 1,072,500 $ 3,877,500 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Taxes [Abstract] | |
Schedule of Income tax expense (benefit) | 2017 2016 2015 Current: Federal $ 3,033 $ (884,000 ) $ 884,000 State 800 800 800 Foreign 4,686 - - Total $ 8,519 $ (883,200 ) $ 884,800 |
Schedule of reconciliation of the income tax at statutory tax rate | 2017 2016 2015 Tax expense (benefit) at statutory rate $ (2,292,820 ) $ (1,158,300 ) $ 987,000 Prepayment from related parties - (286,300 ) 286,300 Net operating loss carryforwards (NOLs) 1,760,600 717,600 (345,000 ) Stock-based compensation expense 594,800 8,000 - Amortization expense (11,200 ) (168,300 ) (28,100 ) Others (42,861 ) 4,100 (15,400 ) Tax (benefit) at effective tax rate $ 8,519 $ (883,200 ) $ 884,800 |
Schedule of deferred tax assets (liability) | 2017 2016 Net operating loss carryforwards (NOLs) $ 2,057,000 $ 519,000 Stock-based compensation expense 489,000 8,000 Accrued expenses and unpaid payable 443,000 35,000 Tax credit carryforwards 68,000 63,000 Excess of tax amortization over book amortization (658,000 ) (230,000 ) 2,399,000 395,000 Valuation allowance (2,399,000 ) (395,000 ) Net $ - $ - |
Capital Stock (Tables)
Capital Stock (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Capital Stock [Abstract] | |
Schedule of restricted shares (after share exchange) | December 31, 2017 2016 Restricted stock - vested 10,238,300 7,787,490 Restricted stock - unvested 41,438 2,492,248 Total restricted stock 10,279,738 10,279,738 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
Schedule of name of related parties and relationships | Related Party Relationship Daniel Shih (Daniel) * Co-founder/promoter and shareholder; Aircom’s CEO and Director between February 13, 2017 and April 26, 2017; Aircom’s CFO between February 13, 2017 and May 5, 2017 Bummy Wu Shareholder Yih Lieh (Giretsu) Shih President of Aircom Japan Hao Wei Peng Employee of Aircom Taiwan dMobile System Co. Ltd. (dMobile) Daniel is the Chairman Klingon Aerospace, Inc. (Klingon) Daniel was the Chairman from February 2015 to February 2016 Law Office of Jan Yung Lin 100% owned by Jan Yung Lin (Director) Priceplay.com, Inc. (PPUS) Daniel is the Chairman Priceplay Taiwan Inc. (PPTW) Parent of PPUS Wealth Wide Int’l Ltd. (WWI) Bummy Wu is the Chairman Yun Shu Chiou Former CEO and President * Daniel has relinquished “beneficial ownership” of substantially all of his equity interests in the Company (whether held directly or indirectly) in a manner acceptable to the Company. This means that Daniel no longer, directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise has or shares (i) voting power, which includes the power to vote, or to direct the voting of, securities, and/or (ii) investment power, which includes the power to dispose, or to direct the disposition of, shares of our common stock, except for a de minimus number of shares of the common stock which will continue to be beneficially owned by him by way of his being a control person in another entity that owns shares of the common stock. Daniel will, however, retain a pecuniary interest in some of the shares of the common stock over which he has relinquished voting and investment power. Daniel has also removed himself from any and all activities relating to the Company’s business, including, but not limited to managerial, directional, advisory, promotional, developmental and fund-raising activities, effective upon the effectiveness of the registration statement on Form S-1 filed with the SEC on December 20, 2017, as amended to date. Additionally, Barbie Shih (Barbie), Daniel’s wife, was not re-elected to our board of directors on December 29, 2017. As a result of these events, neither Daniel nor Barbie will maintain any active affiliation with, or material beneficial ownership interest in, the Company. |
Schedule of significant related party transactions | a. As of December 31, 2017 and 2016, December 31, 2017 2016 Other receivable from Hao Wei Peng 1 $ 46,743 $ - Rental deposit to Daniel $ 2,396 $ 4,966 Other payable to: Klingon 2 762,000 762,000 Daniel 3 128,543 49,500 Yih Lieh (Giretsu) Shih 3 76,600 69,385 WWI 4 9,410 - PPTW - 819,300 PPUS - 737,000 dMobile - 471,100 Bummy Wu - 32,149 Others 3 105,842 15,141 Total $ 1,082,395 $ 2,955,575 1. Represents receivable from Mr. Peng due to the transactions prior to the acquisition of Aircom Telecom on December 19, 2017. The amount is subsequently collected on January 4, 2018. 2. On March 9, 2015, the Company entered into a 10-year purchase agreement with Klingon. In accordance with the terms of this agreement, Klingon agreed to purchase from the Company an initial order of onboard equipment comprising an onboard system for a purchase price of $909,000, with payments to be made in accordance with a specific milestones schedule. As of December 31, 2017 and 2016, the Company received $762,000 from Klingon in milestone payments towards the equipment purchase price. Since the project might not be successful, the Company reclassified the balance from customer prepayment to other payable due to uncertainty. 3. Represents payable to employees as a result of regular operating activities. 4. Represents rent for a warehouse in Hong Kong to store the Company’s hardware. b. For the years ended December 31, 2017, 2016 and 2015, Year Ended December 31, 2017 2016 2015 Sales to dMobile $ - $ - $ 5,478,900 PPUS - - 650,000 Total $ - $ - $ 6,128,900 |
Schedule of related party transactions expense | Year Ended December 31, 2017 2016 2015 Intangible purchase from dMobile $ - $ - $ 4,950,000 Legal expense paid to Law Office of Jan Yung Lin $ - $ 10,000 $ 51,431 Consulting expense paid to Yun Shu Chiou $ 55,000 $ - $ - Rental expense charged by Daniel $ 20,232 $ - $ - Rental expense charged by WWI $ 3,150 $ - $ - |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of estimate the fair value of options granted | Assumptions Expected term 3 - 5 years Expected volatility 40.11% - 59.18% Expected dividends 0% Risk-free interest rate 0.71 – 2.40% Forfeiture rate 0% - 5% |
Aircom 2014 Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Summary of weighted average exercise price and estimated fair value of options | Number of shares Weighted Average Exercise Price Per Share Weighted Average Fair Value Per Share Options outstanding at January 1, 2016 4,139,241 $ 0.0013 $ 0.0004 Granted 1,305,166 0.6704 0.2108 Exercised - - - Forfeited/Cancelled - - - Options outstanding at December 31, 2016 5,444,407 0.1617 0.0508 Granted - - - Exercised (19,681 ) 0.0013 0.0004 Forfeited/Cancelled (763,418 ) 0.6550 0.2059 Options outstanding at December 31, 2017 4,661,307 0.0816 0.0256 Options exercisable at December 31, 2016 2,066,858 0.0013 0.0004 Options exercisable at December 31, 2017 3,148,972 0.0412 0.0129 |
Summary of nonvested shares | Number of Shares Weighted Per Share Options nonvested at January 1, 2016 4,139,241 $ 0.0013 Granted 1,305,166 0.6704 Vested (2,066,858 ) 0.0013 Forfeited/Cancelled - - Options nonvested at December 31, 2016 3,377,549 0.2597 Granted - - Vested (1,101,795 ) 0.1146 Forfeited/Cancelled (763,418 ) 0.6550 Options nonvested at December 31, 2017 1,512,335 0.1663 |
Aerkomm 2017 Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Summary of weighted average exercise price and estimated fair value of options | Number of Shares Weighted Average Exercise Price Per Share Weighted Average Fair Value Per Share Options outstanding at January 1, 2017 - $ - $ - Granted 2,060,000 5.9154 3.5401 Exercised - - - Forfeited/Cancelled (795,000 ) 5.5000 3.2922 Options outstanding at December 31, 2017 1,265,000 6.1765 3.6959 Options exercisable at December 31, 2017 423,750 5.5708 3.4005 |
Summary of nonvested shares | Number of Shares Weighted Average Exercise Price Per Share Options nonvested at January 1, 2017 - $ - Granted 2,060,000 5.9154 Vested (423,750 ) 5.5708 Forfeited/Cancelled (795,000 ) 5.5000 Options nonvested at December 31, 2017 841,250 6.4816 |
Organization (Details)
Organization (Details) | 1 Months Ended | 12 Months Ended | |||||||
Feb. 13, 2017 | Dec. 28, 2016shares | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 19, 2017USD ($) | Dec. 19, 2017TWD ($) | Jun. 30, 2017USD ($) | Dec. 31, 2014USD ($) | |
Organization (Textual) | |||||||||
Stock purchase agreement | shares | 700,000 | ||||||||
Acquisition, description | On February 13, 2017, Aerkomm entered into a share exchange agreement ("Exchange Agreement") with Aircom and its shareholders, pursuant to which Aerkomm acquired 100% of the issued and outstanding capital stock of Aircom in exchange for approximately 99.7% of the issued and outstanding capital stock of Aerkomm (or 87.81% on a fully-diluted basis). As a result of the share exchange, Aircom became a wholly-owned subsidiary of Aerkomm, and the former shareholders of Aircom became the holders of approximately 99.7% of Aerkomm's issued and outstanding capital stock. | ||||||||
Common stock shares | 99.70% | 86.30% | |||||||
Working capital deficiency | $ 2,572,313 | ||||||||
Total owners equity | 6,454,063 | $ 5,862,268 | $ 3,511,420 | $ (35,154) | |||||
Comprehensive loss | (7,135,918) | $ (3,176,474) | $ 2,670,414 | ||||||
Aerkomm [Member] | |||||||||
Organization (Textual) | |||||||||
Common stock shares | 100.00% | ||||||||
Aircom [Member] | |||||||||
Organization (Textual) | |||||||||
Common stock shares | 99.70% | ||||||||
Working capital deficiency | $ 460,000 | ||||||||
Aggregate initial equity investment | $ 500,000 | $ 15,150,000 | $ 1,500,000 | ||||||
Total owners equity | $ 3,350 | $ 100,000 |
Summary of Significant Accoun28
Summary of Significant Accounting Policies (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Purchased intangible asset consists of satellite system software and is amortized, useful life | 10 years | ||
Research and development costs | $ 336,000 | $ 1,579,000 | $ 25,000 |
Furniture and fixtures [Member] | |||
Property and equipment, useful life | 5 years | ||
Computer equipment [Member] | Minimum [Member] | |||
Property and equipment, useful life | 3 years | ||
Computer equipment [Member] | Maximum [Member] | |||
Property and equipment, useful life | 5 years | ||
Satellite equipment [Member] | |||
Property and equipment, useful life | 5 years |
Inventories (Details)
Inventories (Details) - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Inventories [Abstract] | ||
Satellite equipment for sale under construction | $ 197,645 | $ 197,645 |
Parts | 11,029 | 11,029 |
Supplies | 5,540 | 6,437 |
Gross | 214,214 | 215,111 |
Allowance for inventory loss | (5,540) | (5,382) |
Net | $ 208,674 | $ 209,729 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Property, Plant and Equipment [Line Items] | ||
Beginning balance | $ 128,917 | $ 95,678 |
Addition | 276,402 | 33,239 |
Ending balance | 405,319 | 128,917 |
Computer software and equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Beginning balance | 118,911 | 92,285 |
Addition | 992 | 26,626 |
Ending balance | 119,903 | 118,911 |
Furniture and fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Beginning balance | 10,006 | 3,393 |
Addition | 6,613 | |
Ending balance | 10,006 | 10,006 |
Satellite Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Beginning balance | ||
Addition | 275,410 | |
Ending balance | $ 275,410 |
Property and Equipment (Detai31
Property and Equipment (Details 1) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Property, Plant and Equipment [Line Items] | ||
Beginning balance | $ 43,825 | $ 12,365 |
Addition | 56,767 | 31,460 |
Ending balance | 100,592 | 43,825 |
Computer software and equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Beginning balance | 39,604 | 12,082 |
Addition | 17,159 | 27,522 |
Ending balance | 56,763 | 39,604 |
Furniture and fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Beginning balance | 4,221 | 283 |
Addition | 1,997 | 3,938 |
Ending balance | 6,218 | 4,221 |
Satellite Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Beginning balance | ||
Addition | 37,611 | |
Ending balance | $ 37,611 |
Property and Equipment (Detai32
Property and Equipment (Details Textual) | Dec. 31, 2017USD ($) |
Property and Equipment (Textual) | |
Construction in progress - Beginning | $ 3,660,000 |
Construction in progress to other receivable | 410,000 |
Construction in progress - Ending | $ 3,250,000 |
Intangible Asset, Net (Details)
Intangible Asset, Net (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Intangible Asset Net [Line Items] | ||
Beginning balance | $ 4,372,500 | $ 4,867,500 |
Addition | (495,000) | (495,000) |
Ending balance | 3,877,500 | 4,372,500 |
Satellite System software [Member] | ||
Intangible Asset Net [Line Items] | ||
Beginning balance | 4,950,000 | 4,950,000 |
Addition | ||
Ending balance | 4,950,000 | 4,950,000 |
Accumulated amortization [Member] | ||
Intangible Asset Net [Line Items] | ||
Beginning balance | 577,500 | 82,500 |
Addition | 495,000 | 495,000 |
Ending balance | $ 1,072,500 | $ 577,500 |
Short-Term Bank Loan (Details)
Short-Term Bank Loan (Details) - Short-term bank credit [Member] | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Short-Term Bank Loan (Textual) | |
Short-term bank credit line | $ 10,000 |
Maturity date | Jun. 14, 2018 |
Annual interest rate | 4.50% |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Current: | |||
Federal | $ 3,033 | $ (884,000) | $ 884,000 |
State | 800 | 800 | 800 |
Foreign | 4,686 | ||
Total | $ 8,519 | $ (883,200) | $ 884,800 |
Income Taxes (Details 1)
Income Taxes (Details 1) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Taxes [Abstract] | |||
Tax expense (benefit) at statutory rate | $ (2,292,820) | $ (1,158,300) | $ 987,000 |
Prepayment from related parties | (286,300) | 286,300 | |
Net operating loss carryforwards (NOLs) | 1,760,600 | 717,600 | (345,000) |
Stock-based compensation expense | 594,800 | 8,000 | |
Amortization expense | (11,200) | (168,300) | (28,100) |
Others | (42,861) | 4,100 | (15,400) |
Tax (benefit) at effective tax rate | $ 8,519 | $ (883,200) | $ 884,800 |
Income Taxes (Details 2)
Income Taxes (Details 2) - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Income Taxes [Abstract] | ||
Net operating loss carryforwards (NOLs) | $ 2,057,000 | $ 519,000 |
Stock-based compensation expense | 489,000 | 8,000 |
Accrued expenses and unpaid payable | 443,000 | 35,000 |
Tax credit carryforwards | 68,000 | 63,000 |
Excess of tax amortization over book amortization | (658,000) | (230,000) |
Gross | 2,399,000 | 395,000 |
Valuation allowance | (2,399,000) | (395,000) |
Net |
Income Taxes (Details Textual)
Income Taxes (Details Textual) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Taxes (Textual) | |||
Change in deferred tax assets valuation allowance | $ 2,004,000 | $ 9,000 | $ 371,000 |
Federal research and development tax credit [Member] | |||
Income Taxes (Textual) | |||
Research and development tax credit | $ 37,000 | ||
Expiring date, description | The credit begins to expire in 2034 if not utilized. | ||
California state research and development tax credit [Member] | |||
Income Taxes (Textual) | |||
Research and development tax credit | $ 39,000 | ||
State [Member] | |||
Income Taxes (Textual) | |||
Net operating loss | $ 7,897,000 | ||
Expiring date, description | Expiring in 2037. | ||
Federal [Member] | |||
Income Taxes (Textual) | |||
Net operating loss | $ 6,686,000 | ||
Expiring date, description | Expiring in 2037. | ||
Japan [Member] | |||
Income Taxes (Textual) | |||
Net operating loss | $ 326,000 | ||
Expiring date, description | Expiring in 2019. |
Capital Stock (Details)
Capital Stock (Details) - Restricted Stock [Member] - shares | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Restricted stock - vested | 10,238,300 | 7,787,490 |
Restricted stock - unvested | 41,438 | 2,492,248 |
Total restricted stock | 10,279,738 | 10,279,738 |
Capital Stock (Details Textual)
Capital Stock (Details Textual) - USD ($) | Jul. 05, 2017 | Jun. 06, 2017 | Feb. 02, 2015 | Nov. 27, 2017 | Oct. 31, 2017 | Aug. 31, 2017 | Mar. 31, 2017 | Feb. 13, 2017 | Jun. 30, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Nov. 30, 2017 | Feb. 29, 2016 |
Capital Stock (Textual) | ||||||||||||||
Preferred stock, par value | $ 0.001 | |||||||||||||
Preferred stock, authorized | 50,000,000 | 10,000,000 | ||||||||||||
Common stock, par value | $ 0.001 | |||||||||||||
Common stock, authorized | 450,000,000 | 210,000,000 | ||||||||||||
Common stock, issued | 41,418,665 | 98,720,060 | ||||||||||||
Shares of restricted stock, granted | 2,890,000 | |||||||||||||
Unvested shares of restricted stock, repurchased | 133,333 | 133,333 | ||||||||||||
Unvested per shares of restricted stock | $ 0.005 | $ 0.005 | ||||||||||||
Restricted stock of split shares | 27,566,670 | |||||||||||||
Conversion of restricted stock, description | On February 13, 2017, all of Aircom's 27,566,670 restricted shares were converted to Aerkomm's restricted stock of 10,279,738 shares at the ratio of 2.681651 to 1, pursuant to the Exchange Agreement (see Note 1). | |||||||||||||
Private placement offering common shares | 892,857 | |||||||||||||
Private placement share aggregate amount | $ 5,000,000 | |||||||||||||
Common stock price per shares | $ 5.60 | |||||||||||||
Additional paid-in capital warrants | $ 60,000 | $ 40,000 | $ 20,000 | |||||||||||
Anthony D [Member] | ||||||||||||||
Capital Stock (Textual) | ||||||||||||||
Common stock, issued | 80,000 | |||||||||||||
Integra Consulting Group LLC [Member] | ||||||||||||||
Capital Stock (Textual) | ||||||||||||||
Common stock, issued | 20,000 | |||||||||||||
Private placement [Member] | ||||||||||||||
Capital Stock (Textual) | ||||||||||||||
Private placement offering common shares | 60,000 | 264,086 | 500,000 | |||||||||||
Private placement share aggregate amount | $ 27,500 | $ 300,000 | $ 1,452,473 | $ 1,500,000 | ||||||||||
Common stock price per shares | $ 5.5 | $ 5 | $ 5.60 | $ 5.50 | $ 3 | |||||||||
Share aggregate value | $ 2,327,400 | |||||||||||||
Shares issued | 465,480 | |||||||||||||
Shares sold | 5,000 | 60,000 | 517,413 | |||||||||||
Subscribed capital | $ 544,913 | |||||||||||||
Warrants [Member] | ||||||||||||||
Capital Stock (Textual) | ||||||||||||||
Conversion of restricted stock, description | The stock warrants allow the service provider to purchase a number of shares of Aircom common stock equal $60,000 divided by 85% of the share price paid by investors for Aircom's common stock in the first subsequent qualifying equity financing event, at an exercise price of $0.01 per share. | |||||||||||||
Additional paid-in capital warrants | 60,000 | |||||||||||||
Cumulative additional paid-in capital related to warrants | $ 120,000 | $ 60,000 | ||||||||||||
Daniel Shih [Member] | Private placement [Member] | ||||||||||||||
Capital Stock (Textual) | ||||||||||||||
Private placement offering common shares | 5,000 | 13,400 | ||||||||||||
Private placement share aggregate amount | $ 27,500 | $ 75,040 | ||||||||||||
Settlement and release agreement [Member] | Total [Member] | ||||||||||||||
Capital Stock (Textual) | ||||||||||||||
Common stock price per shares | $ 5 | |||||||||||||
Share aggregate value | $ 2,027,400 | |||||||||||||
Shares issued | 405,480 | |||||||||||||
Settlement and release agreement [Member] | Priceplay Taiwan Inc. ("PPTW") [Member] | ||||||||||||||
Capital Stock (Textual) | ||||||||||||||
Share aggregate value | $ 819,300 | |||||||||||||
Shares issued | 163,860 | |||||||||||||
Settlement and release agreement [Member] | Priceplay.com, Inc. (PPUS) [Member] | ||||||||||||||
Capital Stock (Textual) | ||||||||||||||
Share aggregate value | $ 737,000 | |||||||||||||
Shares issued | 147,400 | |||||||||||||
Settlement and release agreement [Member] | dMobile [Member] | ||||||||||||||
Capital Stock (Textual) | ||||||||||||||
Share aggregate value | $ 471,100 | |||||||||||||
Shares issued | 94,220 |
Related Party Transactions (Det
Related Party Transactions (Details) | 12 Months Ended | |
Dec. 31, 2017 | ||
Daniel Shih (Daniel) [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship | Co-founder/promoter and shareholder; Aircom’s CEO and Director between February 13, 2017 and April 26, 2017; Aircom’s CFO between February 13, 2017 and May 5, 2017 | [1] |
Bummy Wu [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship | Shareholder | |
Yih Lieh (Giretsu) Shih [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship | President of Aircom Japan | |
Hao Wei Peng [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship | Employee of Aircom Taiwan | |
dMobile System Co. Ltd. (dMobile) [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship | Daniel is the Chairman | |
Klingon Aerospace, Inc. (Klingon) [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship | Daniel was the Chairman from February 2015 to February 2016 | |
Law Office of Jan Yung Lin [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship | 100% owned by Jan Yung Lin (Director) | |
Priceplay.com, Inc. (PPUS) [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship | Daniel is the Chairman | |
Priceplay Taiwan Inc. (PPTW) [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship | Parent of PPUS | |
Wealth Wide Int'l Ltd. (WWI) [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship | Bummy Wu is the Chairman | |
Yun Shu Chiou [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship | Former CEO and President | |
[1] | Daniel has relinquished "beneficial ownership" of substantially all of his equity interests in our company (whether held directly or indirectly) in a manner acceptable to the Company. This means that Daniel no longer, directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise has or shares (i) voting power, which includes the power to vote, or to direct the voting of, securities, and/or (ii) investment power, which includes the power to dispose, or to direct the disposition of, shares of our common stock, except for a de minimus number of shares of the common stock which will continue to be beneficially owned by him by way of his being a control person in another entity that owns shares of the common stock. Daniel will, however, retain a pecuniary interest in some of the shares of the common stock over which he has relinquished voting and investment power. Daniel has also removed himself from any and all activities relating to the Company's business, including, but not limited to managerial, directional, advisory, promotional, developmental and fund-raising activities, effective upon the effectiveness of the registration statement on Form S-1 filed with the SEC on December 20, 2017, as amended to date. Additionally, Barbie Shih (Barbie), Daniel's wife, was not re-elected to our board of directors on December 29, 2017. As a result of these events, neither Daniel nor Barbie will maintain any active affiliation with, or material beneficial ownership interest in, the company. |
Related Party Transactions (D42
Related Party Transactions (Details 1) - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 | |
Related Party Transaction [Line Items] | |||
Other receivable | $ 46,743 | ||
Other payable | 1,082,395 | 2,955,575 | |
Klingon [Member] | |||
Related Party Transaction [Line Items] | |||
Other payable | [1] | 762,000 | 762,000 |
Daniel [Member] | |||
Related Party Transaction [Line Items] | |||
Rental deposit | 2,396 | 4,966 | |
Other payable | [2] | 128,543 | 49,500 |
Yih Lieh (Giretsu) Shih [Member] | |||
Related Party Transaction [Line Items] | |||
Other payable | [2] | 76,600 | 69,385 |
WWI [Member] | |||
Related Party Transaction [Line Items] | |||
Other payable | [3] | 9,410 | |
PPTW [Member] | |||
Related Party Transaction [Line Items] | |||
Other payable | 819,300 | ||
PPUS [Member] | |||
Related Party Transaction [Line Items] | |||
Other payable | 737,000 | ||
dMobile [Member] | |||
Related Party Transaction [Line Items] | |||
Other payable | 471,100 | ||
Bummy Wu [Member] | |||
Related Party Transaction [Line Items] | |||
Other payable | 32,149 | ||
Others [Member] | |||
Related Party Transaction [Line Items] | |||
Other payable | [2] | 105,842 | 15,141 |
Hao Wei Peng [Member] | |||
Related Party Transaction [Line Items] | |||
Other receivable | [4] | $ 46,743 | |
[1] | On March 9, 2015, the Company entered into a 10-year purchase agreement with Klingon. In accordance with the terms of this agreement, Klingon agreed to purchase from the Company an initial order of onboard equipment comprising an onboard system for a purchase price of $909,000, with payments to be made in accordance with a specific milestones schedule. As of December 31, 2017 and 2016, the Company received $762,000 from Klingon in milestone payments towards the equipment purchase price. Since the project might not be successful, the Company reclassified the balance from customer prepayment to other payable due to uncertainty. | ||
[2] | Represents payable to employees as a result of regular operating activities. | ||
[3] | Represents rent for a warehouse in Hong Kong to store the Company's hardware. | ||
[4] | Represents receivable from Mr. Peng due to the transactions prior to the acquisition of Aircom Telecom on December 19, 2017. The amount is subsequently collected on January 4, 2018. |
Related Party Transactions (D43
Related Party Transactions (Details 2) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Related Party Transaction [Line Items] | |||
Sales | $ 6,128,900 | ||
dMobile [Member] | |||
Related Party Transaction [Line Items] | |||
Sales | 5,478,900 | ||
PPUS [Member] | |||
Related Party Transaction [Line Items] | |||
Sales | $ 650,000 |
Related Party Transactions (D44
Related Party Transactions (Details 3) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
dMobile [Member] | |||
Related Party Transaction [Line Items] | |||
Intangible purchase | $ 4,950,000 | ||
Jan Yung Lin [Member] | |||
Related Party Transaction [Line Items] | |||
Legal expenses paid to Law Office | 10,000 | 51,431 | |
Yun Shu Chiou [Member] | |||
Related Party Transaction [Line Items] | |||
Consulting expense paid | 55,000 | ||
Daniel [Member] | |||
Related Party Transaction [Line Items] | |||
Rental expense charged | 20,232 | ||
WWI [Member] | |||
Related Party Transaction [Line Items] | |||
Rental expense charged | $ 3,150 |
Related Party Transactions (D45
Related Party Transactions (Details Textual) - USD ($) | Mar. 09, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Related Party Transactions (Textual) | |||||
Rental fee, per month | $ 1,200 | ||||
Lease agreement, description | Aircom Japan entered into a lease agreement with Daniel, between August 1, 2014 and July 31, 2016, which was renewed to expire on July 31, 2018. | ||||
Sales to related parties | 100.00% | ||||
Purchase price of equipment | $ 273,015 | $ 3,686,597 | $ 78,508 | ||
Other payable | 1,082,395 | 2,955,575 | |||
Klingon [Member] | |||||
Related Party Transactions (Textual) | |||||
Purchase agreement periods | 10 years | ||||
Purchase price of equipment | $ 909,000 | ||||
Other payable | [1] | $ 762,000 | 762,000 | ||
WWI [Member] | |||||
Related Party Transactions (Textual) | |||||
Lease agreement, description | The Company has a lease agreement with WWI with the monthly rental cost of $450. The lease term is from June 1, 2017 to May 31, 2018. | ||||
Other payable | [2] | $ 9,410 | |||
[1] | On March 9, 2015, the Company entered into a 10-year purchase agreement with Klingon. In accordance with the terms of this agreement, Klingon agreed to purchase from the Company an initial order of onboard equipment comprising an onboard system for a purchase price of $909,000, with payments to be made in accordance with a specific milestones schedule. As of December 31, 2017 and 2016, the Company received $762,000 from Klingon in milestone payments towards the equipment purchase price. Since the project might not be successful, the Company reclassified the balance from customer prepayment to other payable due to uncertainty. | ||||
[2] | Represents rent for a warehouse in Hong Kong to store the Company's hardware. |
Stock Based Compensation (Detai
Stock Based Compensation (Details) - Aircom 2014 Plan and Aerkomm 2017 Plan [Member] | 12 Months Ended |
Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected dividends | 0.00% |
Minimum [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected term | 3 years |
Expected volatility | 40.11% |
Risk-free interest rate | 0.71% |
Forfeiture rate | 0.00% |
Maximum [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected term | 5 years |
Expected volatility | 59.18% |
Risk-free interest rate | 2.40% |
Forfeiture rate | 5.00% |
Stock Based Compensation (Det47
Stock Based Compensation (Details 1) - Aircom 2014 Plan [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Number of shares | ||
Outstanding, Beginning | 5,444,407 | 4,139,241 |
Granted | 1,305,166 | |
Exercised | (19,681) | |
Forfeited/Cancelled | (763,418) | |
Outstanding, Ending | 4,661,307 | 5,444,407 |
Exercisable, Ending | 3,148,972 | 2,066,858 |
Weighted Average Exercise Price Per Share | ||
Outstanding, Beginning | $ 0.1617 | $ 0.0013 |
Granted | 0.6704 | |
Exercised | 0.0013 | |
Forfeited/Cancelled | 0.6550 | |
Outstanding, Ending | 0.0816 | 0.1617 |
Exercisable, Ending | 0.0412 | 0.0013 |
Weighted Average Fair Value Per Share | ||
Outstanding Options, beginning | 0.0508 | 0.0004 |
Granted | 0.2108 | |
Exercised | 0.0004 | |
Forfeited/Cancelled | 0.2059 | |
Outstanding Options, Ending | 0.0256 | 0.0508 |
Exercisable, Ending | $ 0.0129 | $ 0.0004 |
Stock Based Compensation (Det48
Stock Based Compensation (Details 2) - Nonvested Shares [Member] - Aircom 2014 Plan [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Number of Shares | ||
Outstanding, Beginning | 3,377,549 | 4,139,241 |
Granted | 1,305,166 | |
Vested | (1,101,795) | (2,066,858) |
Forfeited/Cancelled | (763,418) | |
Outstanding, Ending | 1,512,335 | 3,377,549 |
Weighted Average Exercise Price Per Share | ||
Outstanding Options, beginning | $ 0.2597 | $ 0.0013 |
Granted | 0.6704 | |
Vested | 0.1146 | 0.0013 |
Forfeited/Cancelled | 0.6550 | |
Outstanding Options, Ending | $ 0.1663 | $ 0.2597 |
Stock Based Compensation (Det49
Stock Based Compensation (Details 3) - Aircom 2017 Plan [Member] | 12 Months Ended |
Dec. 31, 2017$ / sharesshares | |
Number of shares | |
Outstanding, Beginning | shares | |
Granted | shares | 2,060,000 |
Exercised | shares | |
Forfeited/Cancelled | shares | (795,000) |
Outstanding, Ending | shares | 1,265,000 |
Exercisable, Ending | shares | 423,750 |
Weighted Average Exercise Price Per Share | |
Outstanding, Beginning | |
Granted | 5.9154 |
Exercised | |
Forfeited/Cancelled | 5.5000 |
Outstanding, Ending | 6.1765 |
Exercisable, Ending | 5.5708 |
Weighted Average Fair Value Per Share | |
Outstanding Options, beginning | |
Granted | 3.5401 |
Exercised | |
Forfeited/Cancelled | 3.2922 |
Outstanding Options, Ending | 3.6959 |
Exercisable, Ending | $ 3.4005 |
Stock Based Compensation (Det50
Stock Based Compensation (Details 4) - Nonvested Shares [Member] - Aerkomm 2017 [Member] | 12 Months Ended |
Dec. 31, 2017$ / sharesshares | |
Number of Shares | |
Outstanding, Beginning | shares | |
Granted | shares | 2,060,000 |
Vested | shares | (423,750) |
Forfeited/Cancelled | shares | (795,000) |
Outstanding, Ending | shares | 841,250 |
Weighted Average Exercise Price Per Share | |
Outstanding Options, beginning | $ / shares | |
Granted | $ / shares | 5.9154 |
Vested | $ / shares | 5.5708 |
Forfeited/Cancelled | $ / shares | 5.5000 |
Outstanding Options, Ending | $ / shares | $ 6.4816 |
Stock Based Compensation (Det51
Stock Based Compensation (Details Textual) - USD ($) | 1 Months Ended | 12 Months Ended | |||
Jun. 23, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | May 05, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock option aggregate shares | 5,444,407 | ||||
Stock-based compensation | $ 1,749,446 | $ 20,000 | |||
Unrecognized compensation cost | $ 5,057,000 | $ 94,000 | $ 2,000 | ||
Minimum [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Recognize weighted average period | 1 year | ||||
Maximum [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Recognize weighted average period | 5 years | ||||
Aerkomm 2017 [Member] | Board of Directors [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Issuance shares of common stock | 10,000,000 | 5,000,000 | |||
Aggregate shares issue | 1,455,000 | ||||
Aerkomm 2014 Plan [Member] | Stock Options [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Description of plan agreements | Which includes, 1) 1/6 of the shares subject to the option shall vest commencing on the vesting start date and the remaining shares shall vest at the rate of 1/60 for the next 60 months on the same day of the month as the vesting start date; 2) 1/4 of the shares subject to the option shall vest commencing on the vesting start date and the remaining shares shall vest at the rate of 1/36 for the next 36 months on the same day of the month as the vesting start date; 3) 1/3 of the shares subject to the option shall vest commencing on the first anniversary of vesting start date and the remaining shares shall vest at the rate of 50% each year for the next two years on the same day of the month as the vesting start date. | The Company, and 1/36th of the shares will be vested each month thereafter. Option price is determined by the Board of Directors. The Plan shall become effective upon its adoption by the Board and shall continue in effect for a term of 10 years unless sooner terminated under the terms of Aircom 2014 Plan. |
Commitments and Contingency (De
Commitments and Contingency (Details) | Apr. 15, 2017USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2017ILS (₪) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2017ILS (₪) | Mar. 31, 2017USD ($) |
Commitments and Contingencie (Textual) | |||||||
Lease expiration year, description | Expired in May 2017, it was renewed and to expire in May 2020. | Expired in May 2017, it was renewed and to expire in May 2020. | |||||
Lease term | 3 years | 3 years | |||||
Future minimum lease payment, Current year | $ 77,000 | ||||||
Future minimum lease payment, Second year | 77,000 | ||||||
Future minimum lease payment, Third year | 32,000 | ||||||
Japan office [Member] | |||||||
Commitments and Contingencie (Textual) | |||||||
Lease rental expenses | 55,043 | ||||||
Future minimum lease payment, Current year | $ 18,700 | ||||||
Consumption tax rate description | The 8% Japan consumption tax. | The 8% Japan consumption tax. | |||||
Asia Sat [Member] | |||||||
Commitments and Contingencie (Textual) | |||||||
Debt amount | $ 8,013,495 | ||||||
Total future payments | 7,411,616 | ||||||
Deposit | 775,000 | ||||||
Wrongly recorded payable balance | $ 1,376,879 | ||||||
California [Member] | |||||||
Commitments and Contingencie (Textual) | |||||||
Lease rental expenses | $ 71,152 | $ 62,472 | $ 39,045 | ||||
Taiwan [Member] | |||||||
Commitments and Contingencie (Textual) | |||||||
Lease expiration year, description | Expiring October 31, 2018 | Expiring October 31, 2018 | |||||
Lease rental expenses | $ 8,000 | ₪ 236,250 | |||||
Total future payments | $ 80,000 | ₪ 2,362,500 | |||||
Satellites service agreement [Member] | |||||||
Commitments and Contingencie (Textual) | |||||||
Lease effective date | Mar. 15, 2017 | Mar. 15, 2017 | |||||
Prepay outstanding amount | $ 285,300 | ||||||
Deposit | $ 95,100 |