Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Mar. 31, 2017 | May 12, 2017 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 | |
Entity Registrant Name | Inrad Optics, Inc. | |
Entity Central Index Key | 719,494 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Trading Symbol | INRD | |
Entity Common Stock, Shares Outstanding | 13,508,267 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Current Assets: | ||
Cash and cash equivalents | $ 766,609 | $ 973,333 |
Accounts receivable (net of allowance for doubtful accounts of $15,000 in 2017 and 2016) | 1,068,164 | 1,204,908 |
Inventories, net | 3,078,941 | 2,739,864 |
Other current assets | 168,763 | 143,970 |
Total Current Assets | 5,082,477 | 5,062,075 |
Plant and Equipment: | ||
Plant and equipment at cost | 14,616,591 | 14,607,155 |
Less: Accumulated depreciation and amortization | (13,811,668) | (13,729,985) |
Total plant and equipment | 804,923 | 877,170 |
Precious Metals | 613,647 | 613,647 |
Intangible Assets, net | 131,345 | 151,402 |
Other Assets | 30,338 | 30,338 |
Total Assets | 6,662,730 | 6,734,632 |
Current Liabilities: | ||
Current portion of other long term notes | 66,848 | 107,801 |
Accounts payable and accrued liabilities | 1,238,470 | 1,074,671 |
Customer advances | 683,996 | 599,340 |
Total Current Liabilities | 1,989,314 | 1,781,812 |
Related Party Convertible Notes Payable | 2,500,000 | 2,500,000 |
Other Long Term Notes, net of current portion | 267,762 | 270,722 |
Total Liabilities | 4,757,076 | 4,552,534 |
Commitments | ||
Shareholders' Equity: | ||
Common stock: $.01 par value; 60,000,000 authorized shares; 13,156,544 shares issued at March 31, 2017 and December 31, 2016 | 131,567 | 131,567 |
Capital in excess of par value | 18,714,837 | 18,699,852 |
Accumulated deficit | (16,925,800) | (16,634,371) |
Stockholders' Equity before Treasury Stock | 1,920,604 | 2,197,048 |
Less - Common stock in treasury, at cost (4,600 shares) | (14,950) | (14,950) |
Total Shareholders’ Equity | 1,905,654 | 2,182,098 |
Total Liabilities and Shareholders’ Equity | $ 6,662,730 | $ 6,734,632 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS [Parenthetical] - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Allowance for doubtful accounts (in dollars) | $ 15,000 | $ 15,000 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 60,000,000 | 60,000,000 |
Common stock, shares issued | 13,156,544 | 13,156,544 |
Treasury stock, shares | 4,600 | 4,600 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Revenues | ||
Total revenue | $ 2,164,320 | $ 2,348,106 |
Cost and expenses | ||
Cost of goods sold | 1,875,187 | 2,073,655 |
Selling, general and administrative expense | 539,840 | 634,035 |
Costs and Expenses, Total | 2,415,027 | 2,707,690 |
(Loss) income from operations | (250,707) | (359,584) |
Other expense: | ||
Interest expensenet | (40,722) | (42,603) |
Nonoperating Income (Expense) | (40,722) | (42,603) |
(Loss) before income taxes | (291,429) | (402,187) |
Income tax (provision) benefit | 0 | 0 |
Net (loss) | $ (291,429) | $ (402,187) |
Net (loss) per share - basic (in dollars per share) | $ (0.02) | $ (0.03) |
Net (loss) per share - diluted (in dollars per share) | $ (0.02) | $ (0.03) |
Weighted average shares outstanding - basic (in shares) | 13,151,944 | 12,733,208 |
Weighted average shares outstanding - diluted (in shares) | 13,151,944 | 12,733,208 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Cash flows from operating activities: | ||
Net (loss) | $ (291,429) | $ (402,187) |
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities: | ||
Depreciation and amortization | 101,740 | 116,768 |
Stock based compensation | 14,985 | 5,962 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 136,744 | (5,906) |
Inventories, net | (339,077) | 95,891 |
Other current assets | (24,793) | (39,590) |
Accounts payable and accrued liabilities | 163,799 | 113,480 |
Customer advances | 84,656 | 6,152 |
Total adjustments and changes | 138,054 | 292,757 |
Net cash used in operating activities | (153,375) | (109,430) |
Cash flows from investing activities: | ||
Capital expenditures | (9,436) | (10,238) |
Net cash used in investing activities | (9,436) | (10,238) |
Cash flows from financing activities: | ||
Principal payments on notes payable-other | (43,913) | (42,033) |
Net cash used in financing activities | (43,913) | (42,033) |
Net decrease in cash and cash equivalents | (206,724) | (161,701) |
Cash and cash equivalents at beginning of period | 973,333 | 673,685 |
Cash and cash equivalents at end of period | 766,609 | 511,984 |
Supplemental Disclosure of Cash Flow Information: | ||
Interest paid | 41,213 | 5,594 |
Income taxes paid | $ 0 | $ 800 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies [Text Block] | - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accompanying unaudited condensed consolidated financial statements include the accounts of Inrad Optics, Inc. and its subsidiaries (collectively, the “Company”). All significant intercompany balances and transactions have been eliminated. The condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments of a normal recurring nature considered necessary for a fair presentation have been included. The results of operations of any interim period are not necessarily indicative of the results of operations to be expected for the full fiscal year. For further information, refer to the consolidated financial statements and accompanying footnotes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016. In preparing these consolidated financial statements, the Company has evaluated events and transactions for potential recognition or disclosure through the date the consolidated financial statements were issued. These unaudited condensed consolidated financial statements and related disclosures have been prepared in conformity with U.S. GAAP which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses reported in those financial statements. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, and makes adjustments when facts and circumstances dictate. As future events and their effects cannot be determined with precision, actual results could differ significantly from those estimates and assumptions. Significant changes, if any, in those estimates resulting from continuing changes in the economic environment will be reflected in the consolidated financial statements in future periods. Inventories are stated at the lower of cost (first-in-first-out basis) or market. The Company records a reserve for slow moving inventory as a charge against earnings for all products identified as surplus, slow-moving or discontinued. Excess work-in-process costs are charged against earnings whenever estimated costs-of-completion exceed unbilled revenues. March 31, December 31, 2017 2016 (Unaudited) Raw materials $ 1,100 $ 1,041 Work in process, including manufactured parts and components 1,381 1,115 Finished goods 598 584 $ 3,079 $ 2,740 Income Taxes The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the Company’s financial statements or tax returns. Deferred tax assets and liabilities are determined based on the difference between the financial statements carrying amounts and the tax basis of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse. For the three months ended March 31, 2017 and 2016, the Company did not record a current provision for either state or federal income tax due to the losses incurred for both income tax and financial reporting purposes. In evaluating the Company’s ability to recover deferred tax assets in future periods, management considers the available positive and negative factors, including the Company’s recent operating results, the existence of cumulative losses and near term forecasts of future taxable income consistent with the plans and estimates that management uses to manage the underlying business. The cumulative loss incurred by the Company in the three-year period ended December 31, 2016 and the three month period ended March 31, 2017 was considered a significant piece of objective negative evidence. Such objective evidence limits the ability to consider other subjective evidence such as our projections for future growth. On the basis of this evaluation as of March 31, 2017, the Company’s management concluded that it is more likely than not that the Company will not be able to realize any portion of the benefit on the net deferred tax balance of $ 5,029,000 When sufficient positive evidence exists, the Company’s income tax expense will be charged with the increase or decrease in its valuation allowance. An increase or reversal of the Company’s valuation allowance could have a significant negative or positive impact on the Company’s future earnings. Net Income (Loss) per Common Share Basic net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of common shares and common stock equivalents outstanding, calculated on the treasury stock method for options, stock grants and warrants using the average market prices during the period, including potential common shares issuable upon conversion of outstanding convertible notes, except if the effect on the per share amounts is anti-dilutive. For the three months ended March 31, 2017, all common stock equivalents were excluded from the computation of diluted net loss per share because their effect is anti-dilutive. This included 2,500,000 1,875,000 901,341 For the three months ended March 31, 2016, all common stock equivalents were excluded from the computation of diluted net loss per share because their effect is anti-dilutive. This included 2,500,000 1,875,000 842,304 Stock-Based Compensation Stock-based compensation expense is estimated at the grant date based on the fair value of the award. The Company estimates the fair value of stock options granted using the Black-Scholes option pricing model. The fair value of restricted stock units granted is based on the closing market price of the Company’s common stock on the date of the grant. The fair value of these awards, adjusted for estimated forfeitures, is amortized over the requisite service period of the award, which is generally the vesting period. New Accounting Guidance In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230) which provides guidance on the classification of certain cash receipts and payments in the statement of cash flows intended to reduce diversity in practice. The guidance is effective for interim and annual periods beginning in 2018. Early adoption is permitted. The guidance is to be applied retrospectively to all periods presented but may be applied prospectively if retrospective application would be impracticable. The Company is currently evaluating the effect of the standard on its Consolidated Statement of Cash Flows. In May 2016, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2016-12 “Revenue from Contracts with Customers (Topic 606), Narrow-Scope Improvements and Practical Expedients” (“ASU 2016-12”), which amends the guidance on transition, collectability, noncash consideration and the presentation of sales and other similar taxes. ASU 2016-12 clarifies that, for a contract to be considered completed at transition, all (or substantially all) of the revenue must have been recognized under legacy GAAP. In addition, ASU 2016-12 clarifies how an entity should evaluate the collectability threshold and when an entity can recognize nonrefundable consideration received as revenue if an arrangement does not meet the standard’s contract criteria. The Company is currently evaluating the impact the adoption of ASU 2016-12 will have on its consolidated financial statements In April 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-10, “Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing.” The amendments clarify two aspects of Topic 606: (a) identifying performance obligations; and (b) the licensing implementation guidance. The update is effective for annual periods beginning after December 15, 2017 including interim reporting periods therein. The Company is currently evaluating the impact the adoption of ASU 2016-10 will have on its consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, Compensation Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting, which simplifies several aspects of the accounting for employee share-based payments, including income tax consequences, application of award forfeitures to expense, classification on the statement of cash flows, and classification of awards as either equity or liabilities. This guidance is effective for annual reporting periods beginning after December 15, 2016, and interim periods within those annual periods. The adoption of this guidance has no material impact on the Company’s consolidated financial statements. In February 2016, the FASB created Topic 842 and issued ASU 2016-02, Leases. The guidance in this update supersedes Topic 840, Leases. This ASU requires lessees to recognize a right-of-use assets and a lease liability, initially measured at the present value of the lease payments on the balance sheet. For public companies, the amendments will be effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Earlier application is permitted. The Company is currently evaluating the impact of the adoption of ASU 2016-02 on its financial statements and disclosure. |
EQUITY COMPENSATION PROGRAM AND
EQUITY COMPENSATION PROGRAM AND STOCK BASED COMPENSATION | 3 Months Ended |
Mar. 31, 2017 | |
Disclosure Of Compensation Related Costs, Share-Based Payments [Abstract] | |
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | NOTE 2- EQUITY COMPENSATION PROGRAM AND STOCK BASED COMPENSATION a) Stock Option Expense The Company's results of operations for the three months ended March 31, 2017 and 2016 include stock-based compensation expense for stock option grants totaling $ 14,985 5,962 4,223 1,578 10,762 4,384 As of March 31, 2017 and 2016, there were $ 127,029 74,854 1.68 1.70 170,000 163,500 Three Months Ended March 31, 2017 2016 Expected Dividend Yield % % Expected Volatility 133 % 128 % Risk-free Interest Rate 2.17 % 2.07 % Expected Term 10 years 10 years b) Stock Option Activity Weighted Average Weighted Average Exercise Remaining Stock Options Number of Options Price per Option Contractual Term (years) Aggregate Intrinsic Value Outstanding at January 1, 2017 760,214 $ .60 4.8 $ 109,168 Granted 170,000 .57 Exercised Expired/Forfeited (28,873) 1.09 Outstanding at March 31, 2017 901,341 $ .58 5.8 $ 189,380 Exercisable at March 31, 2017 580,846 $ .66 4.4 $ 114,777 Options Weighted-AverageGrant-DateFairValue Non-vested- January 1, 2017 272,167 $0.28 Granted 170,000 $0.55 Vested -121,672 $0.27 Forfeited - - Non-vested March 31, 2017 320,495 $0.43 |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 3 Months Ended |
Mar. 31, 2017 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity Note Disclosure [Text Block] | NOTE 3 STOCKHOLDERS’ EQUITY In April 2017, a total of 356,323 common shares were issued to the Inrad Optics 401k plan as a match to employee contributions for the year ended December 31, 2016. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Mar. 31, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions Disclosure [Text Block] | NOTE 4 RELATED PARTY TRANSACTIONS On June 9, 2016, the maturity dates of a $ 1,500,000 1,000,000 April 1, 2019 6 1,500,000 1,000,000 0.75 1.35 75,000 |
OTHER LONG TERM NOTES
OTHER LONG TERM NOTES | 3 Months Ended |
Mar. 31, 2017 | |
Other Liabilities Disclosure [Abstract] | |
Other Liabilities Disclosure [Text Block] | NOTE 5 OTHER LONG TERM NOTES March 31, December 31, 2017 2016 (in thousands) Term Note Payable, payable in equal monthly installments of $13,953 and bearing an interest rate of 4.35% and expiring in July 2017 $ 55 $ 96 U.S. Small Business Administration term note payable in equal monthly installments of $1,922 and bearing an interest rate of 4.0% and expiring in April 2032. $ 279 $ 282 334 378 Less current portion (67) (108) Long-term debt, excluding current portion $ 267 $ 270 |
SUMMARY OF SIGNIFICANT ACCOUN11
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Basis of Accounting, Policy [Policy Text Block] | Basis of Presentation The accompanying unaudited condensed consolidated financial statements include the accounts of Inrad Optics, Inc. and its subsidiaries (collectively, the “Company”). All significant intercompany balances and transactions have been eliminated. The condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments of a normal recurring nature considered necessary for a fair presentation have been included. The results of operations of any interim period are not necessarily indicative of the results of operations to be expected for the full fiscal year. For further information, refer to the consolidated financial statements and accompanying footnotes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016. In preparing these consolidated financial statements, the Company has evaluated events and transactions for potential recognition or disclosure through the date the consolidated financial statements were issued. |
Use of Estimates, Policy [Policy Text Block] | Management Estimates These unaudited condensed consolidated financial statements and related disclosures have been prepared in conformity with U.S. GAAP which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses reported in those financial statements. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, and makes adjustments when facts and circumstances dictate. As future events and their effects cannot be determined with precision, actual results could differ significantly from those estimates and assumptions. Significant changes, if any, in those estimates resulting from continuing changes in the economic environment will be reflected in the consolidated financial statements in future periods. |
Inventory, Policy [Policy Text Block] | Inventories Inventories are stated at the lower of cost (first-in-first-out basis) or market. The Company records a reserve for slow moving inventory as a charge against earnings for all products identified as surplus, slow-moving or discontinued. Excess work-in-process costs are charged against earnings whenever estimated costs-of-completion exceed unbilled revenues. March 31, December 31, 2017 2016 (Unaudited) Raw materials $ 1,100 $ 1,041 Work in process, including manufactured parts and components 1,381 1,115 Finished goods 598 584 $ 3,079 $ 2,740 |
Income Tax, Policy [Policy Text Block] | Income Taxes The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the Company’s financial statements or tax returns. Deferred tax assets and liabilities are determined based on the difference between the financial statements carrying amounts and the tax basis of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse. For the three months ended March 31, 2017 and 2016, the Company did not record a current provision for either state or federal income tax due to the losses incurred for both income tax and financial reporting purposes. In evaluating the Company’s ability to recover deferred tax assets in future periods, management considers the available positive and negative factors, including the Company’s recent operating results, the existence of cumulative losses and near term forecasts of future taxable income consistent with the plans and estimates that management uses to manage the underlying business. The cumulative loss incurred by the Company in the three-year period ended December 31, 2016 and the three month period ended March 31, 2017 was considered a significant piece of objective negative evidence. Such objective evidence limits the ability to consider other subjective evidence such as our projections for future growth. On the basis of this evaluation as of March 31, 2017, the Company’s management concluded that it is more likely than not that the Company will not be able to realize any portion of the benefit on the net deferred tax balance of $ 5,029,000 When sufficient positive evidence exists, the Company’s income tax expense will be charged with the increase or decrease in its valuation allowance. An increase or reversal of the Company’s valuation allowance could have a significant negative or positive impact on the Company’s future earnings. |
Earnings Per Share, Policy [Policy Text Block] | Net Income (Loss) per Common Share Basic net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of common shares and common stock equivalents outstanding, calculated on the treasury stock method for options, stock grants and warrants using the average market prices during the period, including potential common shares issuable upon conversion of outstanding convertible notes, except if the effect on the per share amounts is anti-dilutive. For the three months ended March 31, 2017, all common stock equivalents were excluded from the computation of diluted net loss per share because their effect is anti-dilutive. This included 2,500,000 1,875,000 901,341 For the three months ended March 31, 2016, all common stock equivalents were excluded from the computation of diluted net loss per share because their effect is anti-dilutive. This included 2,500,000 1,875,000 842,304 |
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] | Stock-Based Compensation Stock-based compensation expense is estimated at the grant date based on the fair value of the award. The Company estimates the fair value of stock options granted using the Black-Scholes option pricing model. The fair value of restricted stock units granted is based on the closing market price of the Company’s common stock on the date of the grant. The fair value of these awards, adjusted for estimated forfeitures, is amortized over the requisite service period of the award, which is generally the vesting period. |
New Accounting Pronouncements, Policy [Policy Text Block] | New Accounting Guidance In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230) which provides guidance on the classification of certain cash receipts and payments in the statement of cash flows intended to reduce diversity in practice. The guidance is effective for interim and annual periods beginning in 2018. Early adoption is permitted. The guidance is to be applied retrospectively to all periods presented but may be applied prospectively if retrospective application would be impracticable. The Company is currently evaluating the effect of the standard on its Consolidated Statement of Cash Flows. In May 2016, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2016-12 “Revenue from Contracts with Customers (Topic 606), Narrow-Scope Improvements and Practical Expedients” (“ASU 2016-12”), which amends the guidance on transition, collectability, noncash consideration and the presentation of sales and other similar taxes. ASU 2016-12 clarifies that, for a contract to be considered completed at transition, all (or substantially all) of the revenue must have been recognized under legacy GAAP. In addition, ASU 2016-12 clarifies how an entity should evaluate the collectability threshold and when an entity can recognize nonrefundable consideration received as revenue if an arrangement does not meet the standard’s contract criteria. The Company is currently evaluating the impact the adoption of ASU 2016-12 will have on its consolidated financial statements In April 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-10, “Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing.” The amendments clarify two aspects of Topic 606: (a) identifying performance obligations; and (b) the licensing implementation guidance. The update is effective for annual periods beginning after December 15, 2017 including interim reporting periods therein. The Company is currently evaluating the impact the adoption of ASU 2016-10 will have on its consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, Compensation Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting, which simplifies several aspects of the accounting for employee share-based payments, including income tax consequences, application of award forfeitures to expense, classification on the statement of cash flows, and classification of awards as either equity or liabilities. This guidance is effective for annual reporting periods beginning after December 15, 2016, and interim periods within those annual periods. The adoption of this guidance has no material impact on the Company’s consolidated financial statements. In February 2016, the FASB created Topic 842 and issued ASU 2016-02, Leases. The guidance in this update supersedes Topic 840, Leases. This ASU requires lessees to recognize a right-of-use assets and a lease liability, initially measured at the present value of the lease payments on the balance sheet. For public companies, the amendments will be effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Earlier application is permitted. The Company is currently evaluating the impact of the adoption of ASU 2016-02 on its financial statements and disclosure. |
SUMMARY OF SIGNIFICANT ACCOUN12
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Schedule of Inventory, Current [Table Text Block] | Inventories are comprised of the following and are shown net of inventory reserves, in thousands: March 31, December 31, 2017 2016 (Unaudited) Raw materials $ 1,100 $ 1,041 Work in process, including manufactured parts and components 1,381 1,115 Finished goods 598 584 $ 3,079 $ 2,740 |
EQUITY COMPENSATION PROGRAM A13
EQUITY COMPENSATION PROGRAM AND STOCK BASED COMPENSATION (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Disclosure Of Compensation Related Costs, Share-Based Payments [Abstract] | |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block] | There were 170,000 163,500 Three Months Ended March 31, 2017 2016 Expected Dividend Yield % % Expected Volatility 133 % 128 % Risk-free Interest Rate 2.17 % 2.07 % Expected Term 10 years 10 years |
Schedule of Share-based Compensation, Stock Options, Activity [Table Text Block] | The following table represents stock options granted, exercised and forfeited during the three month period ended March 31, 2017: Weighted Average Weighted Average Exercise Remaining Stock Options Number of Options Price per Option Contractual Term (years) Aggregate Intrinsic Value Outstanding at January 1, 2017 760,214 $ .60 4.8 $ 109,168 Granted 170,000 .57 Exercised Expired/Forfeited (28,873) 1.09 Outstanding at March 31, 2017 901,341 $ .58 5.8 $ 189,380 Exercisable at March 31, 2017 580,846 $ .66 4.4 $ 114,777 |
Share Based Compensation Arrangement By Share Based Payment Award Options Non Vested [Table Text Block] | The following table represents non-vested stock options granted, vested and forfeited for the three months ended March 31, 2017. Options Weighted-AverageGrant-DateFairValue Non-vested- January 1, 2017 272,167 $0.28 Granted 170,000 $0.55 Vested -121,672 $0.27 Forfeited - - Non-vested March 31, 2017 320,495 $0.43 |
OTHER LONG TERM NOTES (Tables)
OTHER LONG TERM NOTES (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of Debt [Table Text Block] | March 31, December 31, 2017 2016 (in thousands) Term Note Payable, payable in equal monthly installments of $13,953 and bearing an interest rate of 4.35% and expiring in July 2017 $ 55 $ 96 U.S. Small Business Administration term note payable in equal monthly installments of $1,922 and bearing an interest rate of 4.0% and expiring in April 2032. $ 279 $ 282 334 378 Less current portion (67) (108) Long-term debt, excluding current portion $ 267 $ 270 |
SUMMARY OF SIGNIFICANT ACCOUN15
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Inventory [Line Items] | ||
Raw materials | $ 1,100,000 | $ 1,041,000 |
Work in process, including manufactured parts and components | 1,381,000 | 1,115,000 |
Finished goods | 598,000 | 584,000 |
Inventories, net | $ 3,078,941 | $ 2,739,864 |
SUMMARY OF SIGNIFICANT ACCOUN16
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Textual) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Summary of Significant Accounting Policies [Line Items] | ||
Deferred Tax Assets, Valuation Allowance | $ 5,029,000 | |
Convertible Debt Securities [Member] | ||
Summary of Significant Accounting Policies [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 2,500,000 | 2,500,000 |
Warrant [Member] | ||
Summary of Significant Accounting Policies [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 1,875,000 | 1,875,000 |
Equity Option [Member] | ||
Summary of Significant Accounting Policies [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 901,341 | 842,304 |
EQUITY COMPENSATION PROGRAM A17
EQUITY COMPENSATION PROGRAM AND STOCK BASED COMPENSATION (Details) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected Dividend Yield | 0.00% | 0.00% |
Expected Volatility | 133.00% | 128.00% |
Risk-free Interest Rate | 2.17% | 2.07% |
Expected Term | 10 years | 10 years |
EQUITY COMPENSATION PROGRAM A18
EQUITY COMPENSATION PROGRAM AND STOCK BASED COMPENSATION (Details 1) - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Options, Outstanding at the Beginning of the period | 760,214 | |
Options, Granted | 170,000 | |
Options, Exercised | 0 | |
Option, Expired/Forfeited | (28,873) | |
Options, Outstanding at the End of the period | 901,341 | 760,214 |
Options, Exercisable at March 31, 2017 | 580,846 | |
Weighted Average Exercise Price Options, Outstanding at the Beginning of the period (in dollars per share) | $ 0.60 | |
Weighted Average Exercise Price per Option, Granted | 0.57 | |
Weighted Average Exercise Price per Option, Exercised | 0 | |
Weighted Average Exercise Price per Option, Expired/Forfeited | 1.09 | |
Weighted Average Exercise Price Options, Outstanding at the End of the period (in dollars per share) | 0.58 | $ 0.60 |
Weighted Average Exercise Price per Option, Exercisable as of March 31, 2017 | $ 0.66 | |
Weighted Average Remaining Contractual Term, Options Outstanding | 5 years 9 months 18 days | 4 years 9 months 18 days |
Weighted Average Remaining Contractual Term, Exercisable at March 31, 2017 | 4 years 4 months 24 days | |
Aggregate Intrinsic Value, Options Outstanding (in dollars) | $ 189,380 | $ 109,168 |
Aggregate Intrinsic Value, Options Exercisable at March 31, 2017 (in dollars) | $ 114,777 |
EQUITY COMPENSATION PROGRAM A19
EQUITY COMPENSATION PROGRAM AND STOCK BASED COMPENSATION (Details 2) | 3 Months Ended |
Mar. 31, 2017$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options - Non-vested - January 1, 2017 | shares | 272,167 |
Options - Granted | shares | 170,000 |
Options - Vested | shares | (121,672) |
Options - Forfeited | shares | 0 |
Options - Non-vested - March 31, 2017 | shares | 320,495 |
Weighted-Average Grant-Date Fair Value - Non-vested at January 1, 2017 (in dollars per share) | $ / shares | $ 0.28 |
Weighted-Average Grant-Date Fair Value - Granted (in dollars per share) | $ / shares | 0.55 |
Weighted-Average Grant-Date Fair Value - Vested (in dollars per share) | $ / shares | 0.27 |
Weighted-Average Grant-Date Fair Value - Forfeited (in dollars per share) | $ / shares | 0 |
Weighted-Average Grant-Date Fair Value - Non-vested at March 31, 2017 (in dollars per share) | $ / shares | $ 0.43 |
EQUITY COMPENSATION PROGRAM A20
EQUITY COMPENSATION PROGRAM AND STOCK BASED COMPENSATION (Details Textual) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-Based Compensation Arrangement By Share-Based Payment Award, Options, Grants In Period, Net Of Forfeitures | 170,000 | |
Employee Stock Option [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized | $ 127,029 | $ 74,854 |
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Period for Recognition (in years) | 1 year 8 months 5 days | 1 year 8 months 12 days |
Allocated Share-based Compensation Expense | $ 14,985 | $ 5,962 |
Share-Based Compensation Arrangement By Share-Based Payment Award, Options, Grants In Period, Net Of Forfeitures | 170,000 | 163,500 |
Employee Stock Option [Member] | Cost of Sales [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Allocated Share-based Compensation Expense | $ 4,223 | $ 1,578 |
Employee Stock Option [Member] | Selling, General and Administrative Expenses [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Allocated Share-based Compensation Expense | $ 10,762 | $ 4,384 |
STOCKHOLDERS' EQUITY (Details T
STOCKHOLDERS' EQUITY (Details Textual) | 1 Months Ended |
Apr. 30, 2017shares | |
Subsequent Event [Member] | |
Class of Stock [Line Items] | |
Stock Issued During Period, Shares, Employee Benefit Plan | 356,323 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Textual) | 1 Months Ended | 3 Months Ended |
Jun. 09, 2016USD ($)$ / sharesshares | Mar. 31, 2017USD ($) | |
Related Party Transaction [Line Items] | ||
Interest Payable | $ 75,000 | |
Clarex [Member] | ||
Related Party Transaction [Line Items] | ||
Debt Instrument, Interest Rate, Stated Percentage | 6.00% | |
Warrants To Purchase Common Stock Number Of Shares Per Warrant | shares | 0.75 | |
Investment Warrants, Exercise Price | $ / shares | $ 1.35 | |
Debt Instrument, Convertible, Terms of Conversion Feature | each unit consisting of one share of common stock and one warrant | |
Affiliate Of Clarex [Member] | ||
Related Party Transaction [Line Items] | ||
Debt Instrument, Convertible, Terms of Conversion Feature | each unit consisting of one share of common stock and one warrant | |
Convertible Subordinated Debt [Member] | Clarex [Member] | ||
Related Party Transaction [Line Items] | ||
Convertible Subordinated Debt | $ 1,500,000 | |
Debt Instrument, Convertible, Number of Equity Instruments | 1,500,000 | |
Convertible Subordinated Debt [Member] | Affiliate Of Clarex [Member] | ||
Related Party Transaction [Line Items] | ||
Convertible Subordinated Debt | $ 1,000,000 | |
Debt Instrument, Maturity Date | Apr. 1, 2019 | |
Debt Instrument, Convertible, Number of Equity Instruments | 1,000,000 |
OTHER LONG TERM NOTES (Details)
OTHER LONG TERM NOTES (Details) - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Debt Instrument [Line Items] | ||
Note Payable | $ 334,000 | $ 378,000 |
Less current portion | (66,848) | (107,801) |
Long-term debt, excluding current portion | 267,762 | 270,722 |
Term Note Payable [Member] | ||
Debt Instrument [Line Items] | ||
Note Payable | 55,000 | 96,000 |
U.S. Small Business Administration Note Payable [Member] | ||
Debt Instrument [Line Items] | ||
Note Payable | $ 279,000 | $ 282,000 |
OTHER LONG TERM NOTES (Details
OTHER LONG TERM NOTES (Details Textual) | 3 Months Ended |
Mar. 31, 2017USD ($) | |
Term Note Payable [Member] | |
Debt Instrument [Line Items] | |
Debt Instrument, Periodic Payment | $ 13,953 |
Debt Instrument, Interest Rate, Stated Percentage | 4.35% |
U.S. Small Business Administration Note Payable [Member] | |
Debt Instrument [Line Items] | |
Debt Instrument, Frequency of Periodic Payment | 1,922 |
Debt Instrument, Interest Rate, Stated Percentage | 4.00% |