Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 31, 2014 | 1-May-14 | |
Document and Entity Information [Abstract] | ' | ' |
Entity Registrant Name | 'Neonode, Inc | ' |
Entity Central Index Key | '0000087050 | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 31-Mar-14 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
Entity Current Reporting Status | 'Yes | ' |
Entity Filer Category | 'Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 37,955,352 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash | $6,192 | $8,815 |
Accounts receivable | 655 | 969 |
Projects in process | 938 | 736 |
Pepaid expenses and other current assets | 655 | 616 |
Total current assets | 8,440 | 11,136 |
Deposits | 8 | ' |
Property and equipment, net | 340 | 335 |
Total assets | 8,788 | 11,471 |
Current liabilities: | ' | ' |
Accounts payable | 425 | 479 |
Accrued expenses | 1,167 | 978 |
Deferred revenue | 3,713 | 3,666 |
Total current liabilities | 5,305 | 5,123 |
Total liabilities | 5,305 | 5,123 |
Stockholders' equity: | ' | ' |
Common stock, 70,000,000 shares authorized with par value $0.001 per share; 37,955,352 and 37,933,799 shares issued and outstanding at March 31, 2014 and December 31, 2013, respectively | 38 | 38 |
Additional paid-in capital | 159,102 | 157,994 |
Accumulated other comprehensive income | 46 | 11 |
Accumulated deficit | -155,703 | -151,695 |
Total stockholders' equity | 3,483 | 6,348 |
Total liabilities and stockholders' equity | 8,788 | 11,471 |
Series B Preferred Stock | ' | ' |
Stockholders' equity: | ' | ' |
Series B Preferred stock, 54,425 shares authorized with par value $0.001 per share; 83 shares issued and outstanding at March 31, 2014 and December 31, 2013, respectively. (In the event of dissolution, each share of Series B Preferred stock has a liquidation preference equal to par value of $0.001 over the shares of common stock) | ' | ' |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Parenthetical) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
Common stock, shares authorized | 70,000,000 | 70,000,000 |
Common stock, par value | $0.00 | $0.00 |
Common stock, shares issued | 37,955,352 | 37,933,799 |
Common stock, shares outstanding | 37,955,352 | 37,933,799 |
Series B Preferred Stock | ' | ' |
Preferred stock, shares authorized | 54,425 | 54,425 |
Preferred stock, par value | $0.00 | $0.00 |
Preferred stock, shares issued | 83 | 83 |
Preferred stock, shares outstanding | 83 | 83 |
Preferred stock, liquidation preference | $0.00 | $0.00 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Operations (Unaudited) (USD $) | 3 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Statements of Operations [Abstract] | ' | ' |
Net revenues | $1,014 | $548 |
Cost of revenues | 166 | 16 |
Gross margin | 848 | 532 |
Operating expenses: | ' | ' |
Product research and development | 1,784 | 1,634 |
Sales and marketing | 1,042 | 805 |
General and administrative | 2,029 | 1,652 |
Total operating expenses | 4,855 | 4,091 |
Loss before provision for income taxes | -4,007 | -3,559 |
Provision for income taxes | 1 | 11 |
Net loss | ($4,008) | ($3,570) |
Loss per common share: | ' | ' |
Basic and diluted loss per share | ($0.11) | ($0.11) |
Basic and diluted - weighted average number of common shares outstanding | 37,941 | 33,511 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Comprehensive Loss (Unaudited) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Statements of Comprehensive Loss [Abstract] | ' | ' |
Net loss | ($4,008) | ($3,570) |
Other comprehensive income (loss): | ' | ' |
Foreign currency translation adjustments | 35 | 13 |
Total comprehensive loss | ($3,973) | ($3,557) |
Condensed_Consolidated_Stateme2
Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Cash flows from operating activities: | ' | ' |
Net loss | ($4,008) | ($3,570) |
Adjustments to reconcile net loss to net cash used in operating activities: | ' | ' |
Stock-based compensation expense | 1,072 | 586 |
Depreciation and amortization | 41 | 32 |
Changes in operating assets and liabilities: | ' | ' |
Accounts receivable | 314 | 1,316 |
Projects in process | -202 | -736 |
Prepaid expenses and other assets | -139 | 550 |
Accounts payable and accrued expenses | 228 | -36 |
Deferred revenue | 48 | 195 |
Net cash used in operating activities | -2,646 | -1,663 |
Cash flows from investing activities: | ' | ' |
Purchase of property and equipment | -46 | -28 |
Net cash used in investing activities | -46 | -28 |
Cash flows from financing activities: | ' | ' |
Proceeds from stock warrant exercises | 36 | 167 |
Net cash provided by financing activities | 36 | 167 |
Effect of exchange rate changes on cash | 33 | 9 |
Net decrease in cash | -2,623 | -1,515 |
Cash at beginning of period | 8,815 | 9,097 |
Cash at end of period | 6,192 | 7,582 |
Supplemental disclosure of cash flow information: | ' | ' |
Cash paid for income taxes | $1 | $11 |
Interim_Period_Reporting
Interim Period Reporting | 3 Months Ended |
Mar. 31, 2014 | |
Interim Period Reporting [Abstract] | ' |
Interim Period Reporting | ' |
1. Interim Period Reporting | |
The accompanying unaudited interim condensed consolidated financial statements, include all adjustments, consisting of normal recurring adjustments that are, in the opinion of management, necessary for a fair presentation of the financial position and results of operations and cash flows for the interim periods presented. The results of operations for the three months ended March 31, 2014 are not necessarily indicative of expected results for the full 2014 fiscal year. | |
The accompanying condensed consolidated financial statements as of March 31, 2014 and for the three months ended March 31, 2014 and 2013 have been prepared by us, pursuant to the rules and regulations of the of the United States (“U.S.”) Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally contained in financial statements prepared in accordance with the accounting principles generally accepted in the U.S. (“U.S. GAAP”) have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto contained in our annual report on Form 10-K for the fiscal year ended December 31, 2013. | |
Operations | |
Neonode Inc. (“we”, “us”, “our”, the “Company”), develops and licenses touch user interfaces and optical multi-touch solutions to Original Equipment Manufacturers (“OEMs”) and Original Design Manufacturers (“ODMs”) who embed Neonode technology into devices that they produce and sell. | |
Reclassifications | |
Projects in process as of December 31, 2013 are now reported under their own caption, separate from prepaid expenses and other current assets, in the accompanying condensed consolidated balance sheet and as a separate component of cash flows from operating activities in the condensed consolidated statement of cash flows for the three months ended March 31, 2013, in order to conform to the current period presentation. |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 3 Months Ended | ||
Mar. 31, 2014 | |||
Summary of Significant Accounting Policies [Abstract] | ' | ||
Summary of Significant Accounting Policies | ' | ||
2. Summary of Significant Accounting Policies | |||
Principles of Consolidation | |||
The condensed consolidated balance sheets at March 31, 2014 (unaudited) and December 31, 2013 and the unaudited condensed consolidated statements of operations, other comprehensive loss, and cash flows for the three months ended March 31, 2014 and 2013 include our accounts and those of our wholly owned subsidiaries, Neonode Technologies AB (“NTAB”), Neonode Americas Inc. (U.S.) (“NAI”), Neonode KK (Japan) (“NJK”), NEON Technology Inc. (U.S.) (“NTI”) and Neno User Interface Solutions AB (Sweden) (“NUIAB”). All significant intercompany accounts and transactions have been eliminated. | |||
Estimates | |||
The preparation of financial statements in conformity with U.S. GAAP requires making estimates and assumptions that affect, at the date of the financial statements, the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities and the reported amounts of revenue and expenses. Actual results could differ from these estimates. Significant estimates include, but are not limited to, collectibility of accounts receivable, recoverability of capitalized project costs and long-lived assets, the valuation allowance related to our deferred tax assets and the fair value of options and warrants issued for stock-based compensation. | |||
Concentration of Cash Balance Risks | |||
Cash balances are maintained at various banks in the U.S., Japan and Sweden. At times, deposits held with financial institutions in the U.S. may exceed the amount of insurance provided by the U.S. Federal Deposit Insurance Corporation (“FDIC”), which provides basic deposit coverage with limits up to $250,000 per owner. The Swedish government provides insurance coverage up to 100,000 euro per customer and covers deposits in all types of accounts. The Japanese government provides insurance coverage up to 10,000,000 Yen per customer. As of March 31, 2014, we had approximately $5.8 million in excess of insurance limits. | |||
Accounts Receivable and Allowance for Doubtful Accounts | |||
Our accounts receivable are stated at net realizable value. Our policy is to maintain allowances for estimated losses resulting from the inability of our customers to make required payments. Credit limits are established through a process of reviewing the financial history and stability of each customer. Where appropriate, we obtain credit rating reports and financial statements of the customer when determining or modifying its credit limits. We regularly evaluate the collectibility of our trade receivable balances based on a combination of factors. When a customer’s account balance becomes past due, we initiate dialogue with the customer to determine the cause. If it is determined that the customer will be unable to meet its financial obligation, such as in the case of a bankruptcy filing, deterioration in the customer’s operating results or financial position or other material events impacting its business, we record a specific allowance to reduce the related receivable to the amount we expect to recover. Should all efforts fail to recover the related receivable, we will write-off the account. We also record an allowance based on certain other factors including the length of time the receivables are past due and historical collection experience with customers. We determined that an allowance for doubtful accounts was not necessary at March 31, 2014 and December 31, 2013. | |||
Projects in Process | |||
Projects in process consist of costs incurred toward the completion of various projects for certain customers. These costs are primarily comprised of direct engineering labor costs and project-specific equipment costs. These costs are capitalized on our balance sheet as an asset and deferred until revenue for each project is recognized in accordance with the Company’s revenue recognition policy. | |||
Property and Equipment | |||
Property and equipment are stated at cost, net of accumulated depreciation and amortization. Depreciation and amortization are computed using the straight-line method based upon estimated useful lives of the assets as follows: | |||
Estimated useful lives | |||
Computer equipment | 3 years | ||
Furniture and fixtures | 5 years | ||
Equipment purchased under capital leases is amortized on a straight-line basis over the estimated useful life of the asset or the term of the lease, whichever is shorter. | |||
Upon retirement or sale of property and equipment, cost and accumulated depreciation and amortization are removed from the accounts and any gains or losses are reflected in the consolidated statement of operations. Maintenance and repairs are charged to expense as incurred. | |||
Long-lived Assets | |||
We assess any impairment by estimating the future cash flow from the associated asset in accordance with relevant accounting guidance. If the estimated undiscounted future cash flow related to these assets decreases or the useful life is shorter than originally estimated, we may incur charges for impairment of these assets. As of March 31, 2014, we believe there is no impairment of our long-lived assets. There can be no assurance, however, that market conditions will not change or sufficient demand for our products and services will materialize, which could result in impairment of long-lived assets in the future. | |||
Foreign Currency Translation and Transaction Gains and Losses | |||
The functional currency of our foreign subsidiaries is the applicable local currency, the Swedish Krona and Japanese Yen. The translation from Swedish Krona and Japanese Yen to U.S. Dollars is performed for balance sheet accounts using current exchange rates in effect at the balance sheet date and for income statement accounts using a weighted-average exchange rate during the period. Foreign currency translation gains were $35,000 and $13,000 during the three months ended March 31, 2014 and 2013, respectively. Gains or losses resulting from translation are included as a separate component of accumulated other comprehensive loss. Gains (losses) resulting from foreign currency transactions are included in general and administrative expense in the accompanying condensed consolidated statements of operations and were $26,000 and $(37,000) during the three months ended March 31, 2014 and 2013, respectively. | |||
Concentration of Credit and Business Risks | |||
Customers who accounted for 10% or more of our accounts receivable as of March 31, 2014 are as follows: | |||
· | KOBO Inc. – 24% | ||
· | Amazon – 15% | ||
· | Magneti Marelli France – 13% | ||
· | Harman Automotive – 11% | ||
Customers who accounted for 10% or more of our accounts receivable as of December 31, 2013 are as follows: | |||
· | KOBO Inc. – 46% | ||
· | Huizhou Desay SV Automotive ., LTD – 10% | ||
Our net revenues for the three months ended March 31, 2014 was earned from fourteen customers. Our customers are located in the U.S., Europe and Asia. Customers who accounted for 10% or more of our net revenues during the three months ended March 31, 2014 are as follows: | |||
· | Leap Frog Enterprises Inc. – 30% | ||
· | Sony Corporation – 16% | ||
· | Netronix Inc. – 14% | ||
· | KOBO Inc. – 11% | ||
Our net revenues for the three months ended March 31, 2013 was earned from nine customers. Our customers are located in the U.S., Europe and Asia. Customers who accounted for 10% or more of our net revenues during the three months ended March 31, 2013 are as follows: | |||
· | KOBO Inc. – 44% | ||
· | Sony Corporation – 20% | ||
· | Netronix Inc. – 21% | ||
· | Barnes & Noble – 10% | ||
Revenue Recognition | |||
Licensing Revenues: | |||
We derive revenue from the licensing of internally developed intellectual property (“IP”). We enter into IP licensing agreements that generally provide licensees the right to incorporate our IP components in their products with terms and conditions that vary by licensee. The IP licensing agreements generally include a nonexclusive license for the underlying IP. Fees under these agreements may include license fees relating to our IP and royalties payable following the distribution by our licensees of products incorporating the licensed technology. The license for our IP has standalone value and can be used by the licensee without maintenance and support. We follow U.S. GAAP for revenue recognition as per unit royalty products are distributed or licensed by our customers. For technology license arrangements that do not require significant modification or customization of the underlying technology, we recognize technology license revenue when: (1) we enter into a legally binding arrangement with a customer for the license of technology; (2) the customer distributes or licenses the products; (3) the customer payment is deemed fixed or determinable and free of contingencies or significant uncertainties; and (4) collection is reasonably assured. Our customers report to us the quantities of products distributed or licensed by them after the end of the reporting period stipulated in the contract, generally 30 to 45 days after the end of the month or quarter. Effective October 16, 2013, we determined it was appropriate to recognize licensing revenue in the period in which royalty reports are received from customers. Prior to October 16, 2013, we recognized licensing revenue in the period in which the products were distributed by our customers. The effect of this change is $0.7 million of license revenues related to products shipped or distributed by our customers in the quarter ended December 31, 2013 was recognized in the quarter ended March 31, 2014. | |||
Explicit return rights are not offered to customers. There have been no returns through March 31, 2014. | |||
Engineering Services: | |||
We may sell engineering consulting services to our customers on a flat rate or hourly rate basis. We recognize revenue from these services when all of the following conditions are met: (1) evidence existed of an arrangement with the customer, typically consisting of a purchase order or contract; (2) our services were performed and risk of loss passed to the customer; (3) we completed all of the necessary terms of the contract; (4) the amount of revenue to which we were entitled was fixed or determinable; and (5) we believed it was probable that we would be able to collect the amount due from the customer. To the extent that one or more of these conditions has not been satisfied, we defer recognition of revenue. Generally, we recognize revenue as the engineering services stipulated under the contract are completed and accepted by our customers. Engineering services performed under a signed Statement of Work (“SOW”) with a customer are accounted for under the completed contract method, as these SOW’s are short-term in nature and our total contract costs are difficult to estimate. Estimated losses on SOW projects are recognized in full as soon as they become evident. | |||
Deferred Revenue | |||
From time-to-time we receive pre-payments from our customers related to future services or future license fee revenues. We defer the license fees until we have met all accounting requirements for revenue recognition as per unit royalty products are distributed or licensed by our customers and the engineering development fee revenue until such time as the engineering work has been completed and accepted by our customers. | |||
Advertising | |||
Advertising costs are expensed as incurred. Advertising costs for the quarters ended March 31, 2014 and 2013 amounted to approximately $106,000 and $124,000, respectively. | |||
Product Research and Development | |||
Research and development (“R&D”) costs are expensed as incurred. R&D costs consist mainly of personnel related costs in addition to some external consultancy costs such as testing, certifying and measurements. | |||
Stock-Based Compensation Expense | |||
We measure the cost of employee services received in exchange for an award of equity instruments, including stock options, based on the fair value of the award on the grant date, and recognize the value as compensation expense over the period the employee is required to provide services in exchange for the award, usually the vesting period, net of estimated forfeitures. | |||
We account for equity instruments issued to non-employees at their fair value. The measurement date for the fair value for the equity instruments issued is determined at the earlier of (i) the date at which a commitment for performance by the consultant or vendor is reached, or (ii) the date at which the consultant or vendor’s performance is complete. In the case of equity instruments issued to consultants, the fair value of the equity instruments is primarily recognized over the term of the consulting agreement. The fair value of the stock-based compensation is periodically re-measured and expense is recognized during the vesting term. | |||
When determining stock-based compensation expense involving options and warrants, we determine the estimated fair value of options and warrants using the Black-Scholes option pricing model. | |||
Income Taxes | |||
We recognize deferred tax liabilities and assets for the expected future tax consequences of items that have been included in the consolidated financial statements or tax returns. We estimate income taxes based on rates in effect in each of the jurisdictions in which we operate. Deferred income tax assets and liabilities are determined based upon differences between the financial statement and income tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The realization of deferred tax assets is based on historical tax positions and expectations about future taxable income. Valuation allowances are recorded against net deferred tax assets when, in our opinion, realization is uncertain based on the “more likely than not” criteria of the accounting guidance. | |||
Based on the uncertainty of future pre-tax income, we fully reserved our net deferred tax assets as of March 31, 2014 and December 31, 2013. In the event we were to determine that we would be able to realize our deferred tax assets in the future, an adjustment to the deferred tax asset would increase income in the period such determination was made. The provision for income taxes represents the net change in deferred tax amounts, plus income taxes paid or payable for the current period. | |||
We follow U.S. GAAP related to uncertain tax positions, which provisions include a two-step approach to recognizing, de-recognizing and measuring uncertain tax positions. As a result, we did not recognize a liability for unrecognized tax benefits. As of March 31, 2014 and December 31, 2013, we had no unrecognized tax benefits. | |||
Net Loss Per Share | |||
Net loss per share amounts have been computed based on the weighted-average number of shares of common stock outstanding during the period. Net loss per share, assuming dilution amounts from common stock equivalents, is computed based on the weighted-average number of shares of common stock and potential common stock equivalents outstanding during the period. The weighted-average number of shares of common stock and potential common stock equivalents used in computing the net loss per share for periods ended March 31, 2014 and 2013 exclude the potential common stock equivalents, as the effect would be anti-dilutive (See Note 8). | |||
Comprehensive Income (Loss) | |||
Our comprehensive loss includes foreign currency translation gains and losses. The cumulative amount of translation gains and losses are reflected as a separate component of stockholders’ equity in the condensed consolidated balance sheets as accumulated other comprehensive income. | |||
Cash Flow Information | |||
Cash flows in foreign currencies have been converted to U.S. dollars at an approximate weighted-average exchange rate for the respective reporting periods. The weighted-average exchange rate for the consolidated statements of operations and comprehensive loss was 6.46 and 6.43 Swedish Krona to one U.S. Dollar for the three months ended March 31, 2014 and 2013, respectively. The exchange rate for the consolidated balance sheets was 6.5 and 6.48 Swedish Krona to one U.S. Dollar as of March 31, 2014 and December 31, 2013, respectively. The weighted-average exchange rate for the consolidated statement of operations and comprehensive loss was 102.82 and 92.19 Japanese Yen to one U.S. Dollar for the three months ended March 31, 2014 and 2013, respectively. The exchange rate for the consolidated balance sheet was 102.80 and 94.16 Japanese Yen to one U.S. Dollar as of March 31, 2014 and December 31, 2013, respectively. | |||
New Accounting Pronouncements | |||
In July 2013, the FASB issued ASU No. 2013-11, “Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists” ASU 2013-11 provides explicit guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The guidance is effective prospectively for fiscal years, and interim periods within those years, beginning after December 15, 2013, with an option for early adoption. The Company adopted this guidance at the beginning of its first quarter of fiscal year 2014, and did not determine there is any impact on its consolidated financial statements and disclosures. |
Deferred_Revenue
Deferred Revenue | 3 Months Ended |
Mar. 31, 2014 | |
Deferred Revenue [Abstract] | ' |
Deferred Revenue | ' |
3. Deferred Revenue | |
As of March 31, 2014 and December 31, 2013, we had $2.4 million and $2.5 million, respectively, of deferred license fee revenue related to prepayments for future license fees from three customers and a total of $1.3 million and $1.2 million, respectively, of deferred engineering development fees from twenty-three and twenty-one customers, respectively. We defer the license fees until we have met all accounting requirements for revenue recognition as per unit royalty products are distributed or licensed by our customers and the engineering development fee revenue until such time as the engineering work has been completed and accepted by our customers. |
Stockholders_Equity
Stockholders' Equity | 3 Months Ended | ||||||||||||
Mar. 31, 2014 | |||||||||||||
Stockholders' Equity [Abstract] | ' | ||||||||||||
Stockholders' Equity | ' | ||||||||||||
4. Stockholders’ Equity | |||||||||||||
Common Stock | |||||||||||||
During the three months ended March 31, 2014, warrant holder’s exercised warrants to purchase 17,000 shares of common stock using the cashless net exercise provision allowed in the warrant and received 10,053 shares of our common stock. In addition, warrant holders exercised warrants to purchase 11,500 shares of common stock and paid a cash exercise price of $3.13 per share for total cash proceeds of approximately $36,000. | |||||||||||||
During the three months ended March 31, 2013, warrant holder’s exercised warrants to purchase 590,094 shares of common stock using the cashless net exercise provision allowed in the warrant and received 464,740 shares of our common stock. The warrant holders exercising their warrants included our Chief Financial Officer who, on February 26, 2013, exercised warrants to purchase 320,000 shares of common stock using the cashless net exercise provision allowed in the warrant and received 266,228 shares of our common stock. | |||||||||||||
Preferred Stock | |||||||||||||
We have one class of preferred stock outstanding. The terms of the Series B Preferred stock are as follows: | |||||||||||||
Dividends and Distributions | |||||||||||||
The holders of shares of Series B Preferred stock are entitled to participate with the holders of our common stock with respect to any dividends declared on the common stock in proportion to the number of shares of common stock issuable upon conversion of the shares of Series B Preferred stock held by them. | |||||||||||||
Liquidation Preference | |||||||||||||
In the event of any liquidation, dissolution, or winding up of our operations, either voluntary or involuntary, subject to the rights of the Series B Preferred stock and Senior Preferred stock, shall be entitled to receive, after any distribution to the holders of senior preferred stock and prior to and in preference to any distribution to the holders of common stock, $0.001 for each share of Series B Preferred stock then outstanding. | |||||||||||||
Voting | |||||||||||||
The holders of shares of Series B Preferred stock have one vote for each share of Series B Preferred stock held by them. | |||||||||||||
Conversion | |||||||||||||
Initially, each share of Series B Preferred stock was convertible into one share of our common stock. On March 31, 2009, our stockholders approved a resolution to increase the authorized share capital, and to increase the conversion ratio to 132.07 shares of our common stock for each share of Series B Preferred stock. | |||||||||||||
The following table summarizes the Preferred stock not yet converted as of March 31, 2014. | |||||||||||||
Shares of Preferred Stock Not Exchanged as of March 31, 2014 | Conversion Ratio | Shares of Common Stock after Conversion of all Outstanding Shares of Preferred Stock Not yet Exchanged at March 31, 2014 | |||||||||||
Series B Preferred stock | 83 | 132.07 | 10,962 | ||||||||||
StockBased_Compensation
Stock-Based Compensation | 3 Months Ended | ||||||||||||
Mar. 31, 2014 | |||||||||||||
Stock-Based Compensation [Abstract] | ' | ||||||||||||
Stock-Based Compensation | ' | ||||||||||||
5. Stock-Based Compensation | |||||||||||||
The stock-based compensation expense for the three months ended March 31, 2014 and 2013 reflects the fair value of the vested portion of options and warrants granted to employees, directors and eligible consultants. Stock-based compensation expense in the accompanying condensed consolidated statements of operations is as follows (in thousands): | |||||||||||||
2014 | 2013 | ||||||||||||
Product research and development | $ | 268 | $ | 60 | |||||||||
Sales and marketing | 175 | 196 | |||||||||||
General and administrative | 629 | 330 | |||||||||||
Stock-based compensation expense | $ | 1,072 | $ | 586 | |||||||||
Remaining unamortized | |||||||||||||
expense at | |||||||||||||
March 31, | |||||||||||||
2014 | |||||||||||||
Stock-based compensation | $ | 2,000 | |||||||||||
The remaining unamortized expense related to stock options and warrants will be recognized on a straight line basis monthly as compensation expense over the remaining vesting period, which approximates 2.0 years. | |||||||||||||
The fair value of stock-based awards is calculated using the Black-Scholes option pricing model, even though this model was developed to estimate the fair value of freely tradable, fully transferable options without vesting restrictions, which differ significantly from our stock options. The Black-Scholes model also requires subjective assumptions, including future stock price volatility and expected time to exercise, which greatly affect the calculated values. The expected term and forfeiture rate of options granted is derived from historical data on employee exercises and post-vesting employment termination behavior, as well as expected behavior on outstanding options. The risk-free rate is based on the U.S. Treasury rates in effect during the corresponding period of grant. The expected volatility is based on the historical volatility of our stock price. These factors could change in the future, which would affect fair values of stock options granted in such future periods, and could cause volatility in the total amount of the stock-based compensation expense reported in future periods. | |||||||||||||
Stock Options | |||||||||||||
We have adopted equity incentive plans for which stock options and restricted stock awards are available to grant to employees and directors. All employee and director stock options granted under our stock option plans have an exercise price equal to the market value of the underlying common stock on the grant date. There are no vesting provisions tied to performance conditions for any options, as vesting for all outstanding option grants is based only on continued service as an employee, consultant or director. All of our outstanding stock options and restricted stock awards are classified as equity instruments. | |||||||||||||
We had two equity incentive plans as of March 31, 2014: | |||||||||||||
· | The 1998 Non-Officer Stock Option Plan (the “1998 Plan”), which expired in June 2008; and | ||||||||||||
· | The 2006 Equity Incentive Plan, including and the Swedish Sub-Plan to the 2006 Equity Incentive Plan, (the “2006 Plan”). | ||||||||||||
We also had one non-employee director stock option plan as of March 31, 2014: | |||||||||||||
· | The 2001 Non-Employee Director Stock Option Plan (the “Director Plan”), which expired in March 2011. | ||||||||||||
A summary of the combined activity under all of the stock option plans is set forth below: | |||||||||||||
Number of Options Outstanding | Weighted Average Exercise Price | ||||||||||||
Outstanding at January 1, 2014 | 1,600,583 | $ | 5.22 | ||||||||||
Granted | 335,000 | 7.09 | |||||||||||
Outstanding at March 31, 2014 | 1,935,583 | $ | 5.54 | ||||||||||
On March 11, 2013, our Board of Directors amended the 2006 Plan to increase of the number of shares of common stock reserved for issuance by 2 million shares to an aggregate of 4,052,000 shares. On May 6, 2013, our stockholders approved the amendment. | |||||||||||||
The aggregate intrinsic value of the 1,935,583 stock options that are outstanding, vested and expected to vest as of March 31, 2014 was $1.9 million. | |||||||||||||
For the three months ended March 31, 2014 and 2013, we recorded $1.1 million and $576,000, respectively, of compensation expense related to the vesting of stock options. The fair value of the stock-based compensation was calculated using the Black-Scholes option pricing model as of the date of grant of the stock option. | |||||||||||||
During the three months ended March 31, 2014, we granted options to purchase 325,000 shares of our common stock to employees and an option to purchase 10,000 shares of our common stock to a member of our board of directors with a grant date fair value of $1.2 million computed using the Black-Scholes option pricing model. The weighted-average grant date fair value of the options granted during the three months ended March 31, 2014 was $3.46 per share. | |||||||||||||
See below for assumptions used in the valuation of stock options: | |||||||||||||
For the three months | |||||||||||||
ended March 31, 2014 | |||||||||||||
Annual dividend yield | - | ||||||||||||
Expected life (years) | 1.50 – 4.30 | ||||||||||||
Risk-free interest rate | 0.27% - 1.47 | % | |||||||||||
Expected volatility | 61% - 109 | % | |||||||||||
The 1998 Plan terminated effective June 15, 2008 and the Director Plan terminated effective March 2011. Although we can no longer issue stock options out of the plans, the outstanding options at the date of termination will remain outstanding and vest in accordance with their terms. Options granted under the Director Plan vested over a one to four-year period, expire five to seven years after the date of grant and have exercise prices reflecting market value of the shares of our common stock on the date of grant. Stock options granted under the 1998 and 2006 Plans are exercisable over a maximum term of ten years from the date of grant, vest in various installments over a one to four-year period and have exercise prices reflecting the market value of the shares of common stock on the date of grant. | |||||||||||||
Warrants | |||||||||||||
The fair value of stock-based compensation related to the issuance of warrants is calculated using the Black-Scholes option pricing model as of the grant date of the underlying warrant. | |||||||||||||
A summary of all warrant activity is set forth below: | |||||||||||||
31-Mar-14 | |||||||||||||
Outstanding and exercisable | Warrants | Weighted Average Exercise Price | Weighted Average | ||||||||||
Remaining Contractual Life | |||||||||||||
1-Jan-14 | 828,574 | $ | 2.39 | 2.06 | |||||||||
Granted | -- | -- | -- | ||||||||||
Expired/cancelled | -- | -- | -- | ||||||||||
Exercised | (28,500 | ) | 2.85 | -- | |||||||||
Outstanding and exercisable, March 31, 2014 | 800,074 | $ | 2.37 | 1.8 | |||||||||
Outstanding Warrants to Purchase | |||||||||||||
Common Stock as of March 31, 2014: | |||||||||||||
Description | Issue Date | Exercise Price | Shares | Expiration Date | |||||||||
August 2009 Employee Warrants | 8/25/09 | $ | 0.5 | 80,000 | 8/25/16 | ||||||||
2007 Debt Extension Warrants | 9/22/10 | $ | 1 | 16,000 | 9/22/15 | ||||||||
December 2010 Employee Warrants | 12/3/10 | $ | 1.63 | 200,000 | 12/3/15 | ||||||||
February 2011 Legal Advisor Warrant | 2/22/11 | $ | 2.5 | 80,000 | 2/22/16 | ||||||||
March 2011 Investor Warrants | 3/9/11 | $ | 3.13 | 349,974 | 3/9/16 | ||||||||
March 2011 Investor Warrants | 4/7/11 | $ | 3.13 | 34,100 | 4/7/16 | ||||||||
May 2011 Consultant Warrant | 5/17/11 | $ | 4.05 | 20,000 | 5/17/14 | ||||||||
September 2011 Employee Warrant | 9/12/11 | $ | 3.9 | 20,000 | 9/12/14 | ||||||||
Total Warrants Outstanding | 800,074 | ||||||||||||
Commitments_and_Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2014 | |
Commitments and Contingencies [Abstract] | ' |
Commitments and Contingencies | ' |
6. Commitments and Contingencies | |
Indemnities and Guarantees | |
We have agreed to indemnify each of our executive officers and directors for certain events or occurrences arising as a result of the officer or director serving in such capacity. The term of the indemnification period is for the officer’s or director’s lifetime. The maximum potential amount of future payments we could be required to make under these indemnification agreements is unlimited. However, we have a directors’ and officers’ liability insurance policy that should enable us to recover a portion of future amounts paid. As a result of our insurance policy coverage, we believe the estimated fair value of these indemnification agreements is minimal and have no liabilities recorded for these agreements as of March 31, 2014 and December 31, 2013. | |
We enter into indemnification provisions under our agreements with other companies in the ordinary course of business, typically with business partners, contractors, customers and landlords. Under these provisions we generally indemnify and hold harmless the indemnified party for losses suffered or incurred by the indemnified party as a result of our activities or, in some cases, as a result of the indemnified party’s activities under the agreement. These indemnification provisions often include indemnifications relating to representations made by us with regard to intellectual property rights. These indemnification provisions generally survive termination of the underlying agreement. The maximum potential amount of future payments we could be required to make under these indemnification provisions is unlimited. We have not incurred material costs to defend lawsuits or settle claims related to these indemnification agreements. As a result, we believe the estimated fair value of these agreements is minimal. Accordingly, we have no liabilities recorded for these indemnification provisions as of March 31, 2014 and December 31, 2013. | |
Non-Recurring Engineering Development Costs | |
Neonode and Texas Instruments Inc. (“TI”) entered into an Analog Device Development Agreement on February 4, 2011 and effective as of January 24, 2010 (the “NN1001 Agreement”) pursuant to which TI integrated Neonode’s intellectual property into an Application Specific Integrated Circuit (“ASIC”) developed by TI. The NN1001 ASIC only can be sold by TI exclusively to licensees of Neonode. Under the terms of the NN1001 Agreement, we will reimburse TI up to $500,000 of non-recurring engineering (“NRE”) development costs based on shipments of the NN1001. Under the terms of the NN1001 Agreement, we will reimburse TI an NRE fee of $0.08 per unit for each of the first one million units sold and $0.05 for the next eight million units sold. During the three months ended March 31, 2014 and 2013, $31,000 and $217,600, respectively of NRE expense related to the NN1001 Agreement is included in research and development in the condensed consolidated statements of operations. Through March 31, 2014, we had made total payments of $338,000 under the NN1001 Agreement. | |
Neonode and TI entered into an additional Analog Device Development Agreement on April 25, 2013 effective December 6, 2012 (the “NN1002 Agreement”) pursuant to which TI will integrate Neonode’s intellectual property into an ASIC developed by TI. The NN1002 ASIC only can be sold by TI exclusively to licensees of Neonode. Under the terms of the NN1002 Agreement, we will reimburse TI up to $500,000 of NRE costs based on shipments of the NN1002. Under the terms of the NN1002 Agreement we will reimburse TI an NRE fee of $0.25 per unit for each of the first two million units sold. The NN1002 is currently in development and has not been released to mass production. As a result, through March 31, 2014, we had made no payments under the NN1002 Agreement. |
Segment_Information
Segment Information | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Segment Information [Abstract] | ' | ||||||||
Segment Information | ' | ||||||||
7. Segment Information | |||||||||
We have one reportable segment, which is comprised of the touch technology licensing business. All of our sales for the three months ended March 31, 2014 and 2013 were to customers located in the U.S., Europe and Asia.The following table presents net revenues by geographic region for the three months ended March 31, 2014 and 2013 (dollars in thousands): | |||||||||
2014 | |||||||||
Amount | Percentage | ||||||||
Net revenues from customers in the U.S. | $ | 668 | 66 | % | |||||
Net revenues from customers in Europe | 25 | 2 | % | ||||||
Net revenues from customers in Asia | 321 | 32 | % | ||||||
Total | $ | 1,014 | 100 | % | |||||
2013 | |||||||||
Amount | Percentage | ||||||||
Net revenues from customers in the U.S. | $ | 292 | 53 | % | |||||
Net revenues from customers in Europe | 18 | 3 | % | ||||||
Net revenues from customers in Asia | 238 | 44 | % | ||||||
Total | $ | 548 | 100 | % |
Net_Loss_Per_Share
Net Loss Per Share | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Net Loss Per Share [Abstract] | ' | ||||||||
Net Loss Per Share | ' | ||||||||
8. Net Loss Per Share | |||||||||
Basic net loss per common share for the three months ended March 31, 2014 and 2013 was computed by dividing the net loss for the relevant period by the weighted average number of shares of common stock outstanding. Diluted loss per common share is computed by dividing net loss by the weighted average number of shares of common stock and common stock equivalents outstanding. | |||||||||
Potential common stock equivalents of approximately 481,000 and 309,000 outstanding stock options, 497,000 and 2.8 million outstanding stock warrants under the treasury stock method and 11,000 and 11,000 shares issuable upon conversion of preferred stock are excluded from the diluted earnings per share calculation for the periods ended March 31, 2014 and 2013, respectively, due to their anti-dilutive effect. | |||||||||
(in thousands, except per share amounts) | Three Months ended March 31, | ||||||||
2014 | 2013 | ||||||||
BASIC AND DILUTED | |||||||||
Weighted average number of | |||||||||
common shares outstanding | 37,941 | 33,511 | |||||||
Number of shares for computation of | |||||||||
net loss per share | 37,941 | 33,511 | |||||||
Net loss | $ | (4,008 | ) | $ | (3,750 | ) | |||
Net loss per share - basic and diluted | $ | (0.11 | ) | $ | (0.11 | ) |
Subsequent_Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2014 | |
Subsequent Events [Abstract] | ' |
Subsequent Events | ' |
9. Subsequent Events | |
On May 9, 2014, the Company entered into a securities purchase agreement (the “Purchase Agreement”) with an accredited institutional investor pursuant to which the Company agreed to issue 2,500,000 shares of common stock at a price of $4.00 per share (the “Investor Shares”) and a warrant (the “Investor Warrant”) for an aggregate purchase price of $10,000,000 in gross proceeds. Under the terms of the Investor Warrant, the holder is entitled to exercise the Investor Warrant to purchase up to an aggregate of 1,964,636 shares of common stock at an exercise price of $5.09 per share for a period of 18 months from the issuance date. Cash exercise of the Investor Warrant will result in the Company receiving up to $10,000,000 in gross proceeds. Closing of the investment pursuant to the Purchase Agreement is expected to occur by May 15, 2014 and is subject to certain closing conditions described therein. | |
In connection with Purchase Agreement, the Company also entered into a registration rights agreement pursuant to which the Company agreed to file a registration statement with the SEC relating to the offer and sale by the holder of the Investor Shares and the shares of common stock issuable upon exercise of the Investor Warrant (the “Investor Warrant Shares”). Pursuant to the registration rights agreement, the Company is obligated to file the registration statement within 30 days of closing and to use best efforts to cause the registration statement to be declared effective within 90 days of closing. Failure to meet those and related obligations, or failure to maintain the effective registration of the Investor Shares and Investor Warrant Shares will subject the Company to payment for liquidated damages. | |
In connection with the sale of the Investor Shares, the Company has agreed to pay a fee to a placement agent of $600,000, and has further agreed to pay a fee to the placement agent of up to $600,000 in connection with the exercise of the Investor Warrant. In addition, the Company has agreed to issue to the placement agent a warrant, subject to the same terms as the Investor Warrant, to acquire 117,879 shares of common stock. | |
Copies of the securities purchase agreement, the registration rights agreement, and the form of warrant are included as Exhibit 10.1, Exhibit 10.2, and Exhibit 10.3 to our Current Report on Form 8-K filed May 12, 2014, and are incorporated herein by reference. The foregoing summaries of each of the three transaction documents are qualified in their entirety by reference to such documents. |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 3 Months Ended | ||
Mar. 31, 2014 | |||
Summary of Significant Accounting Policies [Abstract] | ' | ||
Principles of Consolidation | ' | ||
Principles of Consolidation | |||
The condensed consolidated balance sheets at March 31, 2014 (unaudited) and December 31, 2013 and the unaudited condensed consolidated statements of operations, other comprehensive loss, and cash flows for the three months ended March 31, 2014 and 2013 include our accounts and those of our wholly owned subsidiaries, Neonode Technologies AB (“NTAB”), Neonode Americas Inc. (U.S.) (“NAI”), Neonode KK (Japan) (“NJK”), NEON Technology Inc. (U.S.) (“NTI”) and Neno User Interface Solutions AB (Sweden) (“NUIAB”). All significant intercompany accounts and transactions have been eliminated. | |||
Estimates | ' | ||
Estimates | |||
The preparation of financial statements in conformity with U.S. GAAP requires making estimates and assumptions that affect, at the date of the financial statements, the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities and the reported amounts of revenue and expenses. Actual results could differ from these estimates. Significant estimates include, but are not limited to, collectibility of accounts receivable, recoverability of capitalized project costs and long-lived assets, the valuation allowance related to our deferred tax assets and the fair value of options and warrants issued for stock-based compensation. | |||
Concentration of Cash Balance Risks | ' | ||
Concentration of Cash Balance Risks | |||
Cash balances are maintained at various banks in the U.S., Japan and Sweden. At times, deposits held with financial institutions in the U.S. may exceed the amount of insurance provided by the U.S. Federal Deposit Insurance Corporation (“FDIC”), which provides basic deposit coverage with limits up to $250,000 per owner. The Swedish government provides insurance coverage up to 100,000 euro per customer and covers deposits in all types of accounts. The Japanese government provides insurance coverage up to 10,000,000 Yen per customer. As of March 31, 2014, we had approximately $5.8 million in excess of insurance limits. | |||
Accounts Receivable and Allowance for Doubtful Accounts | ' | ||
Accounts Receivable and Allowance for Doubtful Accounts | |||
Our accounts receivable are stated at net realizable value. Our policy is to maintain allowances for estimated losses resulting from the inability of our customers to make required payments. Credit limits are established through a process of reviewing the financial history and stability of each customer. Where appropriate, we obtain credit rating reports and financial statements of the customer when determining or modifying its credit limits. We regularly evaluate the collectibility of our trade receivable balances based on a combination of factors. When a customer’s account balance becomes past due, we initiate dialogue with the customer to determine the cause. If it is determined that the customer will be unable to meet its financial obligation, such as in the case of a bankruptcy filing, deterioration in the customer’s operating results or financial position or other material events impacting its business, we record a specific allowance to reduce the related receivable to the amount we expect to recover. Should all efforts fail to recover the related receivable, we will write-off the account. We also record an allowance based on certain other factors including the length of time the receivables are past due and historical collection experience with customers. We determined that an allowance for doubtful accounts was not necessary at March 31, 2014 and December 31, 2013. | |||
Projects in Process | ' | ||
Projects in Process | |||
Projects in process consist of costs incurred toward the completion of various projects for certain customers. These costs are primarily comprised of direct engineering labor costs and project-specific equipment costs. These costs are capitalized on our balance sheet as an asset and deferred until revenue for each project is recognized in accordance with the Company’s revenue recognition policy. | |||
Property and Equipment | ' | ||
Property and Equipment | |||
Property and equipment are stated at cost, net of accumulated depreciation and amortization. Depreciation and amortization are computed using the straight-line method based upon estimated useful lives of the assets as follows: | |||
Estimated useful lives | |||
Computer equipment | 3 years | ||
Furniture and fixtures | 5 years | ||
Equipment purchased under capital leases is amortized on a straight-line basis over the estimated useful life of the asset or the term of the lease, whichever is shorter. | |||
Upon retirement or sale of property and equipment, cost and accumulated depreciation and amortization are removed from the accounts and any gains or losses are reflected in the consolidated statement of operations. Maintenance and repairs are charged to expense as incurred. | |||
Long-lived Assets | ' | ||
Long-lived Assets | |||
We assess any impairment by estimating the future cash flow from the associated asset in accordance with relevant accounting guidance. If the estimated undiscounted future cash flow related to these assets decreases or the useful life is shorter than originally estimated, we may incur charges for impairment of these assets. As of March 31, 2014, we believe there is no impairment of our long-lived assets. There can be no assurance, however, that market conditions will not change or sufficient demand for our products and services will materialize, which could result in impairment of long-lived assets in the future. | |||
Foreign Currency Translation and Transaction Gains and Losses | ' | ||
Foreign Currency Translation and Transaction Gains and Losses | |||
The functional currency of our foreign subsidiaries is the applicable local currency, the Swedish Krona and Japanese Yen. The translation from Swedish Krona and Japanese Yen to U.S. Dollars is performed for balance sheet accounts using current exchange rates in effect at the balance sheet date and for income statement accounts using a weighted-average exchange rate during the period. Foreign currency translation gains were $35,000 and $13,000 during the three months ended March 31, 2014 and 2013, respectively. Gains or losses resulting from translation are included as a separate component of accumulated other comprehensive loss. Gains (losses) resulting from foreign currency transactions are included in general and administrative expense in the accompanying condensed consolidated statements of operations and were $26,000 and $(37,000) during the three months ended March 31, 2014 and 2013, respectively. | |||
Concentration of Credit and Business Risks | ' | ||
Concentration of Credit and Business Risks | |||
Customers who accounted for 10% or more of our accounts receivable as of March 31, 2014 are as follows: | |||
· | KOBO Inc. – 24% | ||
· | Amazon – 15% | ||
· | Magneti Marelli France – 13% | ||
· | Harman Automotive – 11% | ||
Customers who accounted for 10% or more of our accounts receivable as of December 31, 2013 are as follows: | |||
· | KOBO Inc. – 46% | ||
· | Huizhou Desay SV Automotive ., LTD – 10% | ||
Our net revenues for the three months ended March 31, 2014 was earned from fourteen customers. Our customers are located in the U.S., Europe and Asia. Customers who accounted for 10% or more of our net revenues during the three months ended March 31, 2014 are as follows: | |||
· | Leap Frog Enterprises Inc. – 30% | ||
· | Sony Corporation – 16% | ||
· | Netronix Inc. – 14% | ||
· | KOBO Inc. – 11% | ||
Our net revenues for the three months ended March 31, 2013 was earned from nine customers. Our customers are located in the U.S., Europe and Asia. Customers who accounted for 10% or more of our net revenues during the three months ended March 31, 2013 are as follows: | |||
· | KOBO Inc. – 44% | ||
· | Sony Corporation – 20% | ||
· | Netronix Inc. – 21% | ||
· | Barnes & Noble – 10% | ||
Revenue Recognition | ' | ||
Revenue Recognition | |||
Licensing Revenues: | |||
We derive revenue from the licensing of internally developed intellectual property (“IP”). We enter into IP licensing agreements that generally provide licensees the right to incorporate our IP components in their products with terms and conditions that vary by licensee. The IP licensing agreements generally include a nonexclusive license for the underlying IP. Fees under these agreements may include license fees relating to our IP and royalties payable following the distribution by our licensees of products incorporating the licensed technology. The license for our IP has standalone value and can be used by the licensee without maintenance and support. We follow U.S. GAAP for revenue recognition as per unit royalty products are distributed or licensed by our customers. For technology license arrangements that do not require significant modification or customization of the underlying technology, we recognize technology license revenue when: (1) we enter into a legally binding arrangement with a customer for the license of technology; (2) the customer distributes or licenses the products; (3) the customer payment is deemed fixed or determinable and free of contingencies or significant uncertainties; and (4) collection is reasonably assured. Our customers report to us the quantities of products distributed or licensed by them after the end of the reporting period stipulated in the contract, generally 30 to 45 days after the end of the month or quarter. Effective October 16, 2013, we determined it was appropriate to recognize licensing revenue in the period in which royalty reports are received from customers. Prior to October 16, 2013, we recognized licensing revenue in the period in which the products were distributed by our customers. The effect of this change is $0.7 million of license revenues related to products shipped or distributed by our customers in the quarter ended December 31, 2013 was recognized in the quarter ended March 31, 2014. | |||
Explicit return rights are not offered to customers. There have been no returns through March 31, 2014. | |||
Engineering Services: | |||
We may sell engineering consulting services to our customers on a flat rate or hourly rate basis. We recognize revenue from these services when all of the following conditions are met: (1) evidence existed of an arrangement with the customer, typically consisting of a purchase order or contract; (2) our services were performed and risk of loss passed to the customer; (3) we completed all of the necessary terms of the contract; (4) the amount of revenue to which we were entitled was fixed or determinable; and (5) we believed it was probable that we would be able to collect the amount due from the customer. To the extent that one or more of these conditions has not been satisfied, we defer recognition of revenue. Generally, we recognize revenue as the engineering services stipulated under the contract are completed and accepted by our customers. Engineering services performed under a signed Statement of Work (“SOW”) with a customer are accounted for under the completed contract method, as these SOW’s are short-term in nature and our total contract costs are difficult to estimate. Estimated losses on SOW projects are recognized in full as soon as they become evident. | |||
Deferred Revenue | ' | ||
Deferred Revenue | |||
From time-to-time we receive pre-payments from our customers related to future services or future license fee revenues. We defer the license fees until we have met all accounting requirements for revenue recognition as per unit royalty products are distributed or licensed by our customers and the engineering development fee revenue until such time as the engineering work has been completed and accepted by our customers. | |||
Advertising | ' | ||
Advertising | |||
Advertising costs are expensed as incurred. Advertising costs for the quarters ended March 31, 2014 and 2013 amounted to approximately $106,000 and $124,000, respectively. | |||
Product Research and Development | ' | ||
Product Research and Development | |||
Research and development (“R&D”) costs are expensed as incurred. R&D costs consist mainly of personnel related costs in addition to some external consultancy costs such as testing, certifying and measurements. | |||
Stock-Based Compensation Expense | ' | ||
Stock-Based Compensation Expense | |||
We measure the cost of employee services received in exchange for an award of equity instruments, including stock options, based on the fair value of the award on the grant date, and recognize the value as compensation expense over the period the employee is required to provide services in exchange for the award, usually the vesting period, net of estimated forfeitures. | |||
We account for equity instruments issued to non-employees at their fair value. The measurement date for the fair value for the equity instruments issued is determined at the earlier of (i) the date at which a commitment for performance by the consultant or vendor is reached, or (ii) the date at which the consultant or vendor’s performance is complete. In the case of equity instruments issued to consultants, the fair value of the equity instruments is primarily recognized over the term of the consulting agreement. The fair value of the stock-based compensation is periodically re-measured and expense is recognized during the vesting term. | |||
When determining stock-based compensation expense involving options and warrants, we determine the estimated fair value of options and warrants using the Black-Scholes option pricing model. | |||
Income Taxes | ' | ||
Income Taxes | |||
We recognize deferred tax liabilities and assets for the expected future tax consequences of items that have been included in the consolidated financial statements or tax returns. We estimate income taxes based on rates in effect in each of the jurisdictions in which we operate. Deferred income tax assets and liabilities are determined based upon differences between the financial statement and income tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The realization of deferred tax assets is based on historical tax positions and expectations about future taxable income. Valuation allowances are recorded against net deferred tax assets when, in our opinion, realization is uncertain based on the “more likely than not” criteria of the accounting guidance. | |||
Based on the uncertainty of future pre-tax income, we fully reserved our net deferred tax assets as of March 31, 2014 and December 31, 2013. In the event we were to determine that we would be able to realize our deferred tax assets in the future, an adjustment to the deferred tax asset would increase income in the period such determination was made. The provision for income taxes represents the net change in deferred tax amounts, plus income taxes paid or payable for the current period. | |||
We follow U.S. GAAP related to uncertain tax positions, which provisions include a two-step approach to recognizing, de-recognizing and measuring uncertain tax positions. As a result, we did not recognize a liability for unrecognized tax benefits. As of March 31, 2014 and December 31, 2013, we had no unrecognized tax benefits. | |||
Net Loss Per Share | ' | ||
Net Loss Per Share | |||
Net loss per share amounts have been computed based on the weighted-average number of shares of common stock outstanding during the period. Net loss per share, assuming dilution amounts from common stock equivalents, is computed based on the weighted-average number of shares of common stock and potential common stock equivalents outstanding during the period. The weighted-average number of shares of common stock and potential common stock equivalents used in computing the net loss per share for periods ended March 31, 2014 and 2013 exclude the potential common stock equivalents, as the effect would be anti-dilutive (See Note 8). | |||
Comprehensive Income (Loss) | ' | ||
Comprehensive Income (Loss) | |||
Our comprehensive loss includes foreign currency translation gains and losses. The cumulative amount of translation gains and losses are reflected as a separate component of stockholders’ equity in the condensed consolidated balance sheets as accumulated other comprehensive income. | |||
Cash Flow Information | ' | ||
Cash Flow Information | |||
Cash flows in foreign currencies have been converted to U.S. dollars at an approximate weighted-average exchange rate for the respective reporting periods. The weighted-average exchange rate for the consolidated statements of operations and comprehensive loss was 6.46 and 6.43 Swedish Krona to one U.S. Dollar for the three months ended March 31, 2014 and 2013, respectively. The exchange rate for the consolidated balance sheets was 6.5 and 6.48 Swedish Krona to one U.S. Dollar as of March 31, 2014 and December 31, 2013, respectively. The weighted-average exchange rate for the consolidated statement of operations and comprehensive loss was 102.82 and 92.19 Japanese Yen to one U.S. Dollar for the three months ended March 31, 2014 and 2013, respectively. The exchange rate for the consolidated balance sheet was 102.80 and 94.16 Japanese Yen to one U.S. Dollar as of March 31, 2014 and December 31, 2013, respectively. | |||
New Accounting Pronouncements | ' | ||
New Accounting Pronouncements | |||
In July 2013, the FASB issued ASU No. 2013-11, “Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists” ASU 2013-11 provides explicit guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The guidance is effective prospectively for fiscal years, and interim periods within those years, beginning after December 15, 2013, with an option for early adoption. The Company adopted this guidance at the beginning of its first quarter of fiscal year 2014, and did not determine there is any impact on its consolidated financial statements and disclosures. |
Summary_of_Significant_Account2
Summary of Significant Accounting Policies (Tables) | 3 Months Ended | |
Mar. 31, 2014 | ||
Summary of Significant Accounting Policies [Abstract] | ' | |
Estimated useful lives of property and equipment | ' | |
Computer equipment | 3 years | |
Furniture and fixtures | 5 years |
Stockholders_Equity_Tables
Stockholders' Equity (Tables) | 3 Months Ended | ||||||||||||
Mar. 31, 2014 | |||||||||||||
Stockholders' Equity [Abstract] | ' | ||||||||||||
Schedule of conversion of preferred stock issued to common stock | ' | ||||||||||||
Shares of Preferred Stock Not Exchanged as of March 31, 2014 | Conversion Ratio | Shares of Common Stock after Conversion of all Outstanding Shares of Preferred Stock Not yet Exchanged at March 31, 2014 | |||||||||||
Series B Preferred stock | 83 | 132.07 | 10,962 |
StockBased_Compensation_Tables
Stock-Based Compensation (Tables) | 3 Months Ended | ||||||||||||
Mar. 31, 2014 | |||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ||||||||||||
Summary of assumptions used to value stock options granted to employees and directors | ' | ||||||||||||
For the three months | |||||||||||||
ended March 31, 2014 | |||||||||||||
Annual dividend yield | - | ||||||||||||
Expected life (years) | 1.50 – 4.30 | ||||||||||||
Risk-free interest rate | 0.27% - 1.47 | % | |||||||||||
Expected volatility | 61% - 109 | % | |||||||||||
Summary of stock-based compensation expense | ' | ||||||||||||
2014 | 2013 | ||||||||||||
Product research and development | $ | 268 | $ | 60 | |||||||||
Sales and marketing | 175 | 196 | |||||||||||
General and administrative | 629 | 330 | |||||||||||
Stock-based compensation expense | $ | 1,072 | $ | 586 | |||||||||
Remaining unamortized | |||||||||||||
expense at | |||||||||||||
March 31, | |||||||||||||
2014 | |||||||||||||
Stock-based compensation | $ | 2,000 | |||||||||||
Summary of all warrant activity | ' | ||||||||||||
31-Mar-14 | |||||||||||||
Outstanding and exercisable | Warrants | Weighted Average Exercise Price | Weighted Average | ||||||||||
Remaining Contractual Life | |||||||||||||
1-Jan-14 | 828,574 | $ | 2.39 | 2.06 | |||||||||
Granted | -- | -- | -- | ||||||||||
Expired/cancelled | -- | -- | -- | ||||||||||
Exercised | (28,500 | ) | 2.85 | -- | |||||||||
Outstanding and exercisable, March 31, 2014 | 800,074 | $ | 2.37 | 1.8 | |||||||||
Summary of outstanding warrants to purchase common stock | ' | ||||||||||||
Description | Issue Date | Exercise Price | Shares | Expiration Date | |||||||||
August 2009 Employee Warrants | 8/25/09 | $ | 0.5 | 80,000 | 8/25/16 | ||||||||
2007 Debt Extension Warrants | 9/22/10 | $ | 1 | 16,000 | 9/22/15 | ||||||||
December 2010 Employee Warrants | 12/3/10 | $ | 1.63 | 200,000 | 12/3/15 | ||||||||
February 2011 Legal Advisor Warrant | 2/22/11 | $ | 2.5 | 80,000 | 2/22/16 | ||||||||
March 2011 Investor Warrants | 3/9/11 | $ | 3.13 | 349,974 | 3/9/16 | ||||||||
March 2011 Investor Warrants | 4/7/11 | $ | 3.13 | 34,100 | 4/7/16 | ||||||||
May 2011 Consultant Warrant | 5/17/11 | $ | 4.05 | 20,000 | 5/17/14 | ||||||||
September 2011 Employee Warrant | 9/12/11 | $ | 3.9 | 20,000 | 9/12/14 | ||||||||
Total Warrants Outstanding | 800,074 | ||||||||||||
Stock Options [Member] | ' | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ||||||||||||
Summary of all stock option plans / warrant activity | ' | ||||||||||||
Number of Options Outstanding | Weighted Average Exercise Price | ||||||||||||
Outstanding at January 1, 2014 | 1,600,583 | $ | 5.22 | ||||||||||
Granted | 335,000 | 7.09 | |||||||||||
Outstanding at March 31, 2014 | 1,935,583 | $ | 5.54 |
Segment_Information_Tables
Segment Information (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Segment Information [Abstract] | ' | ||||||||
Summary of net revenues by geographic region | ' | ||||||||
2014 | |||||||||
Amount | Percentage | ||||||||
Net revenues from customers in the U.S. | $ | 668 | 66 | % | |||||
Net revenues from customers in Europe | 25 | 2 | % | ||||||
Net revenues from customers in Asia | 321 | 32 | % | ||||||
Total | $ | 1,014 | 100 | % | |||||
2013 | |||||||||
Amount | Percentage | ||||||||
Net revenues from customers in the U.S. | $ | 292 | 53 | % | |||||
Net revenues from customers in Europe | 18 | 3 | % | ||||||
Net revenues from customers in Asia | 238 | 44 | % | ||||||
Total | $ | 548 | 100 | % |
Net_Loss_Per_Share_Tables
Net Loss Per Share (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Net Loss Per Share [Abstract] | ' | ||||||||
Basic and diluted for net loss per share | ' | ||||||||
(in thousands, except per share amounts) | Three Months ended March 31, | ||||||||
2014 | 2013 | ||||||||
BASIC AND DILUTED | |||||||||
Weighted average number of | |||||||||
common shares outstanding | 37,941 | 33,511 | |||||||
Number of shares for computation of | |||||||||
net loss per share | 37,941 | 33,511 | |||||||
Net loss | $ | (4,008 | ) | $ | (3,750 | ) | |||
Net loss per share - basic and diluted | $ | (0.11 | ) | $ | (0.11 | ) | |||
Summary_of_Significant_Account3
Summary of Significant Accounting Policies (Details) | 3 Months Ended |
Mar. 31, 2014 | |
Computer equipment [Member] | ' |
Estimated useful lives of property and equipment | ' |
Estimated useful lives | 'P3Y |
Furniture and fixtures [Member] | ' |
Estimated useful lives of property and equipment | ' |
Estimated useful lives | 'P7Y |
Summary_of_Significant_Account4
Summary of Significant Accounting Policies (Details Textual) | 3 Months Ended | 3 Months Ended | 3 Months Ended | 3 Months Ended | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | |
USD ($) | USD ($) | Leap Frog Enterprises Inc [Member] | Amazon [Member] | Kobo Inc [Member] | Kobo Inc [Member] | Kobo Inc [Member] | Sony Corporation [Member] | Sony Corporation [Member] | Barnes and Noble [Member] | Netronix Inc [Member] | Netronix Inc [Member] | Huizhou Desay SV Automotive Co., LTD [Member] | Magneti Marelli France [Member] | Harman Automotive [Member] | Minimum [Member] | Maximum [Member] | US [Member] | Sweden [Member] | Japan [Member] | ||
Customers | Customer | USD ($) | EUR (€) | JPY (¥) | |||||||||||||||||
Summary of Significant Accounting Policies (Textual) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basic deposit coverage limits per owner and customer | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $250,000 | € 100,000 | ¥ 10,000,000 |
Entity-Wide Revenue, Major Customer, Percentage | ' | ' | ' | 30.00% | ' | 11.00% | 44.00% | ' | 16.00% | 20.00% | 10.00% | 14.00% | 21.00% | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of net revenues earned from major customers | 10.00% | 10.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Days of reporting period stipulated in the contract | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '30 days | '45 days | ' | ' | ' |
License revenues related to products shipped | 700,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of accounts receivable due by major customers | 10.00% | ' | 10.00% | ' | 15.00% | 24.00% | ' | 46.00% | ' | ' | ' | ' | ' | 10.00% | 13.00% | 11.00% | ' | ' | ' | ' | ' |
Excess of insurance limits | 5,800,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gains or (losses) resulting from foreign currency transactions | 26,000 | -37,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Foreign currency translation gain (loss) | 35,000 | 13,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenue earned, Number of customers | 14 | 9 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Advertising costs | $106,000 | $124,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted-average exchange rate for consolidated statements of operations (Swedish Krona to one U.S. Dollar) | 6.46 | 6.43 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Exchange rate for the consolidated balance sheets (Swedish Krona to one U.S. Dollar) | 6.5 | ' | 6.48 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted-average exchange rate for consolidated statements of operations (Japanese Yen to one U.S. Dollar) | 102.82 | 92.19 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Exchange rate for the consolidated balance sheets (Japanese Yen to one U.S. Dollar) | 102.8 | ' | 94.16 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred_Revenue_Details
Deferred Revenue (Details) (USD $) | 3 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Dec. 31, 2013 |
Customers | Customer | |
Deferred Revenue (Textual) | ' | ' |
Deferred fees | $3,713 | $3,666 |
Prepayments from future license fees [Member] | ' | ' |
Deferred Revenue (Textual) | ' | ' |
Deferred fees | 2,400 | 2,500 |
Number of customer | 3 | 3 |
Deferred engineering development fees [Member] | ' | ' |
Deferred Revenue (Textual) | ' | ' |
Deferred fees | $1,300 | $1,200 |
Number of customer | 23 | 21 |
Stockholders_Equity_Details
Stockholders' Equity (Details) (Series B Preferred Stock [Member]) | 3 Months Ended |
Mar. 31, 2014 | |
Series B Preferred Stock [Member] | ' |
Schedule of conversion of preferred stock issued to common stock | ' |
Shares of Preferred Stock Not Exchanged as of March 31, 2014 | 83 |
Conversion Ratio | 132.07 |
Shares of Common Stock after Conversion of all Outstanding Shares of Preferred Stock Not yet Exchanged at March 31, 2014 | 10,962 |
Stockholders_Equity_Details_Te
Stockholders' Equity (Details Textual) (USD $) | Mar. 31, 2014 | Mar. 31, 2013 | Feb. 26, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 |
Series B Preferred Stock [Member] | Series B Preferred Stock [Member] | Warrant [Member] | ||||
Stockholders Equity (Textual) | ' | ' | ' | ' | ' | ' |
Preferred stock, liquidation preference | ' | ' | ' | $0.00 | $0.00 | ' |
Preferred stock conversion ratio per share of common stock | ' | ' | ' | 132.07 | ' | ' |
Description of common stock conversion rate | ' | ' | ' | 'One vote for each share | ' | ' |
Conversion of warrant into common stock, shares converted | 10,053 | 464,740 | 266,228 | ' | ' | ' |
Value of warrants | $36,000 | ' | ' | ' | ' | ' |
Exercise price | ' | ' | ' | ' | ' | 3.13 |
Common stock issuable upon exercise of warrants | 17,000 | 590,094 | 320,000 | ' | ' | ' |
Common stock issuable upon exercise of additional warrants | 11,500 | ' | ' | ' | ' | ' |
StockBased_Compensation_Detail
Stock-Based Compensation (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Summary of stock-based compensation expense | ' | ' |
Share-based compensation expense | $1,072,000 | $586,000 |
Remaining unamortized expense of stock-based compensation | 2,000,000 | ' |
Product research and development [Member] | ' | ' |
Summary of stock-based compensation expense | ' | ' |
Share-based compensation expense | 268,000 | 60,000 |
Sales and marketing [Member] | ' | ' |
Summary of stock-based compensation expense | ' | ' |
Share-based compensation expense | 175,000 | 196,000 |
General and administrative [Member] | ' | ' |
Summary of stock-based compensation expense | ' | ' |
Share-based compensation expense | $629,000 | $330,000 |
StockBased_Compensation_Detail1
Stock-Based Compensation (Details 1) (Stock Options [Member], USD $) | 3 Months Ended |
Mar. 31, 2014 | |
Stock Options [Member] | ' |
Summary of all stock option plans / warrant activity | ' |
Number of Options/Warrants Outstanding, Beginning Balance | 1,600,583 |
Number of Options/Warrants Outstanding, Granted | 335,000 |
Number of Options/Warrants Outstanding, Ending Balance | 1,935,583 |
Weighted Average Exercise Price, Outstanding, Beginning Balance | $5.22 |
Weighted Average Exercise Price, Granted | $7.09 |
Weighted Average Exercise Price, Outstanding, Ending Balance | $5.54 |
StockBased_Compensation_Detail2
Stock-Based Compensation (Details 2) | 3 Months Ended |
Mar. 31, 2014 | |
Summary of assumptions used to value stock options granted to employees | ' |
Annual dividend yield | ' |
Minimum [Member] | ' |
Summary of assumptions used to value stock options granted to employees | ' |
Expected life (years) | '1 year 6 months |
Risk-free interest rate | 0.27% |
Expected volatility | 61.00% |
Maximum [Member] | ' |
Summary of assumptions used to value stock options granted to employees | ' |
Expected life (years) | '4 years 3 months 18 days |
Risk-free interest rate | 1.47% |
Expected volatility | 109.00% |
StockBased_Compensation_Detail3
Stock-Based Compensation (Details 3) (Warrant [Member], USD $) | 3 Months Ended |
Mar. 31, 2014 | |
Warrant [Member] | ' |
Summary of all stock option plans / warrant activity | ' |
Number of Options/Warrants Outstanding, Beginning Balance | 828,574 |
Warrants, Issued | ' |
Warrants, Expired/cancelled | ' |
Number of Options/Warrants Outstanding, Exercised | -28,500 |
Number of Options/Warrants Outstanding, Ending Balance | 800,074 |
Weighted Average Exercise Price, Outstanding, Beginning Balance | $2.39 |
Weighted Average Exercise Price, Issued | ' |
Weighted Average Exercise Price, Expired/cancelled | ' |
Weighted Average Exercise Price, Exercised | $2.85 |
Weighted Average Exercise Price, Outstanding, Ending Balance | $2.37 |
Weighted Average Remaining Contractual Life, Outstanding and exercisable | '2 years 22 days |
Weighted Average Remaining Contractual Life, Issued | '0 years |
Weighted Average Remaining Contractual Life, Expired/cancelled | '0 years |
Weighted Average Remaining Contractual Life, Exercised | '1 year 9 months 18 days |
StockBased_Compensation_Detail4
Stock-Based Compensation (Details 4) (USD $) | 3 Months Ended |
Mar. 31, 2014 | |
Summary of outstanding warrants to purchase common stock | ' |
Shares | 800,074 |
August 2009 Employee Warrants [Member] | ' |
Summary of outstanding warrants to purchase common stock | ' |
Issue Date | 25-Aug-09 |
Exercise Price | $0.50 |
Shares | 80,000 |
Expiration Date | 25-Aug-16 |
2007 Debt Extension Warrants [Member] | ' |
Summary of outstanding warrants to purchase common stock | ' |
Issue Date | 22-Sep-10 |
Exercise Price | $1 |
Shares | 16,000 |
Expiration Date | 22-Sep-15 |
December 2010 Employee Warrants [Member] | ' |
Summary of outstanding warrants to purchase common stock | ' |
Issue Date | 3-Dec-10 |
Exercise Price | $1.63 |
Shares | 200,000 |
Expiration Date | 3-Dec-15 |
February 2011 Legal Advisor Warrant [Member] | ' |
Summary of outstanding warrants to purchase common stock | ' |
Issue Date | 22-Feb-11 |
Exercise Price | $2.50 |
Shares | 80,000 |
Expiration Date | 22-Feb-16 |
March 2011 Investor Warrants One [Member] | ' |
Summary of outstanding warrants to purchase common stock | ' |
Issue Date | 7-Apr-11 |
Exercise Price | $3.13 |
Shares | 34,100 |
Expiration Date | 7-Apr-16 |
March 2011 Investor Warrants [Member] | ' |
Summary of outstanding warrants to purchase common stock | ' |
Issue Date | 9-Mar-11 |
Exercise Price | $3.13 |
Shares | 349,974 |
Expiration Date | 9-Mar-16 |
May 2011 Consultant Warrant [Member] | ' |
Summary of outstanding warrants to purchase common stock | ' |
Issue Date | 17-May-11 |
Exercise Price | $4.05 |
Shares | 20,000 |
Expiration Date | 17-May-14 |
September 2011 Employee Warrant [Member] | ' |
Summary of outstanding warrants to purchase common stock | ' |
Issue Date | 12-Sep-11 |
Exercise Price | $3.90 |
Shares | 20,000 |
Expiration Date | 9-Dec-14 |
Stock_Based_Compensation_Detai
Stock Based Compensation (Details Textual) (USD $) | 0 Months Ended | 3 Months Ended | |
Mar. 11, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | |
Plans | |||
Stock-Based Compensation (Textual) | ' | ' | ' |
Number of shares of common stock reserved for issuance as incentive stock options | 4,052,000 | ' | ' |
Additional common stock authorized for issuance as incentive stock options | 2,000,000 | ' | ' |
Share-based compensation expense | ' | $1,072,000 | $586,000 |
Weighted average grant date fair value | ' | $3.46 | ' |
Vesting period | ' | '2 years | ' |
Stock option expiration date | ' | 'June 2008 | ' |
Options granted to purchase of common stock to employee | ' | 325,000 | ' |
Options granted to purchase of common stock to board members | ' | 10,000 | ' |
Options granted to purchase of common stock to board members, fair value | ' | 1,200,000 | ' |
Number Of Equity Incentive Plan | ' | 2 | ' |
Number Of Non Employee Director Stock Option Plan | ' | 1 | ' |
1998 Non Officer Stock Option Plan and Equity Incentive Plan [Member] | ' | ' | ' |
Stock-Based Compensation (Textual) | ' | ' | ' |
Stock option expiration date | ' | 'June 15, 2008 | ' |
2001 Non-Employee Director Stock Option Plan [Member] | ' | ' | ' |
Stock-Based Compensation (Textual) | ' | ' | ' |
Stock option expiration date | ' | 'March 2011 | ' |
Minimum [Member] | ' | ' | ' |
Stock-Based Compensation (Textual) | ' | ' | ' |
Vesting period | ' | '1 year | ' |
Minimum [Member] | 1998 Non Officer Stock Option Plan and Equity Incentive Plan [Member] | ' | ' | ' |
Stock-Based Compensation (Textual) | ' | ' | ' |
Vesting period | ' | '1 year | ' |
Minimum [Member] | 2001 Non-Employee Director Stock Option Plan [Member] | ' | ' | ' |
Stock-Based Compensation (Textual) | ' | ' | ' |
Vesting period | ' | '1 year | ' |
Stock option expiration period | ' | '5 years | ' |
Minimum [Member] | 2006 Equity Incentive Plan [Member] | ' | ' | ' |
Stock-Based Compensation (Textual) | ' | ' | ' |
Vesting period | ' | '1 year | ' |
Maximum [Member] | ' | ' | ' |
Stock-Based Compensation (Textual) | ' | ' | ' |
Vesting period | ' | '4 years | ' |
Maximum [Member] | 1998 Non Officer Stock Option Plan and Equity Incentive Plan [Member] | ' | ' | ' |
Stock-Based Compensation (Textual) | ' | ' | ' |
Vesting period | ' | '4 years | ' |
Stock option expiration period | ' | '10 years | ' |
Maximum [Member] | 2001 Non-Employee Director Stock Option Plan [Member] | ' | ' | ' |
Stock-Based Compensation (Textual) | ' | ' | ' |
Vesting period | ' | '4 years | ' |
Stock option expiration period | ' | '7 years | ' |
Maximum [Member] | 2006 Equity Incentive Plan [Member] | ' | ' | ' |
Stock-Based Compensation (Textual) | ' | ' | ' |
Vesting period | ' | '4 years | ' |
Stock option expiration period | ' | '10 years | ' |
Stock Options [Member] | ' | ' | ' |
Stock-Based Compensation (Textual) | ' | ' | ' |
Options outstanding, vested and expected to vest, outstanding, number | ' | 1,935,583 | ' |
Options outstanding, vested and expected to vest, aggregate intrinsic value | ' | 1,900,000 | ' |
Share-based compensation expense | ' | $1,100,000 | $576,000 |
Commitments_and_Contingencies_
Commitments and Contingencies (Details Textual) (USD $) | 0 Months Ended | 3 Months Ended | ||
Dec. 06, 2012 | Jan. 24, 2010 | Mar. 31, 2014 | Mar. 31, 2013 | |
Commitments and Contingencies (Textual) | ' | ' | ' | ' |
Non-recurring engineering development costs contributed to TI | $500,000 | $500,000 | ' | ' |
Description of NRE cost contributed to TI | 'Under the terms of the NN1002 Agreement we will reimburse TI an NRE fee of $0.25 per unit for each of the first two million units sold. | 'Under the terms of the NN1001 Agreement, we will reimburse TI an NRE fee of $0.08 per unit for each of the first one million units sold and $0.05 for the next eight million units sold. | ' | ' |
NRE cost contributed for each of first one million unit sold, Per unit | ' | $0.08 | ' | ' |
NRE cost contributed for next eight million unit sold, Per unit | ' | $0.05 | ' | ' |
NRE fee contributed for each of first two million unit sold, Per unit | $0.25 | ' | ' | ' |
Non recurring expense included in product research and development | ' | ' | 31,000 | 217,600 |
Payment made under NN1001 agreement | ' | ' | $338,000 | ' |
Segment_Information_Details
Segment Information (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Summary of net revenues by geographic region | ' | ' |
Net revenues | $1,014 | $548 |
Revenues percentage | 100.00% | 100.00% |
U.S. [Member] | ' | ' |
Summary of net revenues by geographic region | ' | ' |
Net revenues | 668 | 292 |
Revenues percentage | 66.00% | 53.00% |
Asia [Member] | ' | ' |
Summary of net revenues by geographic region | ' | ' |
Net revenues | 321 | 238 |
Revenues percentage | 32.00% | 44.00% |
Europe [Member] | ' | ' |
Summary of net revenues by geographic region | ' | ' |
Net revenues | $25 | $18 |
Revenues percentage | 2.00% | 3.00% |
Segment_Information_Details_Te
Segment Information (Details Textual) | 3 Months Ended |
Mar. 31, 2014 | |
Segments | |
Segment Information (Textual) | ' |
Number of reportable segments | 1 |
Net_Loss_Per_Share_Details
Net Loss Per Share (Details) (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
BASIC AND DILUTED | ' | ' |
Weighted average number of common shares outstanding | 37,941 | 33,511 |
Number of shares for computation of net loss per share | 37,941 | 33,511 |
Net loss | ($4,008) | ($3,570) |
Net loss per share - basic and diluted | ($0.11) | ($0.11) |
Net_Loss_Per_Share_Details_Tex
Net Loss Per Share (Details Textual) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Stock Option [Member] | ' | ' |
Net Loss Per Share (Textual) | ' | ' |
Antidilutive securities excluded from computation of earnings per share | 481,000 | 309,000 |
Warrant [Member] | ' | ' |
Net Loss Per Share (Textual) | ' | ' |
Antidilutive securities excluded from computation of earnings per share | 497,000 | 2,800,000 |
Convertible Preferred Stock [Member] | ' | ' |
Net Loss Per Share (Textual) | ' | ' |
Antidilutive securities excluded from computation of earnings per share | 11,000 | 11,000 |
Subsequent_Events_Details_Text
Subsequent Events (Details Textual) (Subsequent Event [Member], USD $) | 0 Months Ended | 3 Months Ended |
9-May-14 | Mar. 31, 2014 | |
Subsequent Event [Line Items] | ' | ' |
Placement agent fee In sale of investor shares | ' | 600,000 |
Placement agent fee in exercise investor warrant | ' | 600,000 |
Acquire shares of common stock | ' | 117,879 |
Purchase Agreement [Member] | ' | ' |
Subsequent Event [Line Items] | ' | ' |
Issue of common stock, shares | 2,500,000 | ' |
Issue of common stock, value | 10,000,000 | ' |
Share price | $4 | ' |
Aggregate of shares | 1,964,636 | ' |
Exercise price of share | 5.09 | ' |
Period of warrants | '18 months | ' |
Cash exercise of warrant | $10,000,000 | ' |
Registration statement on purchase agreement description | ' | 'Pursuant to the registration rights agreement, the Company is obligated to file the registration statement within 30 days of closing and to use best efforts to cause the registration statement to be declared effective within 90 days of closing. |