Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2015 | Nov. 10, 2015 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | DIRECT INSITE CORP | |
Entity Central Index Key | 879,703 | |
Current Fiscal Year End Date | --12-31 | |
Entity Well-known Seasoned Issuer | No | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 12,925,048 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2015 |
CONDENSED BALANCE SHEETS (Unaud
CONDENSED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 2,032 | $ 871 |
Accounts receivable | 1,450 | 2,407 |
Prepaid expenses and other current assets | 522 | 383 |
Deferred tax assets - current | 234 | 234 |
Total current assets | 4,238 | 3,895 |
Property and equipment, net | 968 | 1,020 |
Deferred tax assets | 961 | 961 |
Other assets | 256 | 244 |
Total assets | 6,423 | 6,120 |
Current liabilities: | ||
Accounts payable and accrued expenses | 1,553 | 1,789 |
Current portion of capital lease obligations | 18 | 27 |
Deferred rent | 39 | 44 |
Deferred revenue | 2 | 52 |
Total current liabilities | 1,612 | 1,912 |
Capital lease obligations, net of current portion | 0 | 9 |
Total liabilities | 1,612 | $ 1,921 |
Stockholders' equity: | ||
Preferred stock, $0.0001 par value; 2,000,000 shares authorized; none issued or outstanding | 0 | |
Common stock, $0.0001 par value; 50,000,000 shares authorized; 12,952,520 and 12,759,870 shares issued and 12,912,593 and 12,719,943 shares outstanding in 2015 and 2014, respectively | 1 | $ 1 |
Additional paid-in capital | 116,421 | 116,161 |
Accumulated deficit | (111,283) | (111,635) |
Common stock in treasury, at cost; 24,371 shares in 2015 and 2014 | (328) | (328) |
Total stockholders' equity | 4,811 | 4,199 |
Total liabilities and stockholders' equity | $ 6,423 | $ 6,120 |
CONDENSED BALANCE SHEETS (Unau3
CONDENSED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares | Sep. 30, 2015 | Dec. 31, 2014 |
Stockholders' equity: | ||
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock authorized (in shares) | 2,000,000 | 2,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, authorized (in shares) | 50,000,000 | 50,000,000 |
Common stock, issued (in shares) | 12,952,520 | 12,759,870 |
Common stock, outstanding (in shares) | 12,912,593 | 12,719,943 |
Treasury stock, at cost (in shares) | 24,371 | 24,371 |
CONDENSED STATEMENTS OF OPERATI
CONDENSED STATEMENTS OF OPERATIONS - UNAUDITED - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Revenues: | ||||
Recurring | $ 1,683 | $ 1,618 | $ 5,086 | $ 4,872 |
Non-recurring | 241 | 436 | 963 | 1,297 |
Total revenues | 1,924 | 2,054 | 6,049 | 6,169 |
Operating costs and expenses: | ||||
Operations, research and development | 771 | 846 | 2,582 | 2,596 |
General and administrative | 566 | 589 | 1,752 | 1,795 |
Sales and marketing | 337 | 423 | 1,117 | 1,467 |
Amortization and depreciation | 64 | 83 | 220 | 249 |
Total operating costs and expenses | 1,738 | 1,941 | 5,671 | 6,107 |
Operating income | 186 | 113 | 378 | 62 |
Other expense, net | 0 | (1) | (2) | (7) |
Income before provision for income taxes | 186 | 112 | 376 | 55 |
Provision for income taxes | 24 | 0 | 24 | 0 |
Net income | $ 162 | $ 112 | $ 352 | $ 55 |
Basic income per share attributable to common stockholders | $ 0.01 | $ 0.01 | $ 0.03 | $ 0 |
Diluted income per share attributable to common stockholders | $ 0.01 | $ 0.01 | $ 0.03 | $ 0 |
Basic weighted average common stock outstanding | 12,863 | 12,658 | 12,831 | 12,640 |
Diluted weighted average common stock outstanding | 12,896 | 12,658 | 12,854 | 12,668 |
CONDENSED STATEMENTS OF CASH FL
CONDENSED STATEMENTS OF CASH FLOWS - UNAUDITED - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Cash flows from operating activities | ||
Net income | $ 352 | $ 55 |
Adjustments to reconcile net income to net cash provided by operations: | ||
Amortization and depreciation | 220 | 249 |
Stock-based compensation expense | 157 | 136 |
Deferred rent expense | (5) | 23 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 957 | (449) |
Prepaid expenses and other current assets | (151) | (8) |
Accounts payable and accrued expenses | (133) | 106 |
Deferred revenue | (50) | 2 |
Total adjustments | 995 | 59 |
Net cash provided by operating activities | 1,347 | 114 |
Cash flows from investing activities: | ||
Purchases of property and equipment | (3) | (18) |
Capitalization of internally developed software | (165) | (372) |
Net cash used in investing activities | (168) | (390) |
Cash flows used in financing activities: | ||
Repayment of capital lease obligations | (18) | (162) |
Net increase (decrease) in cash and cash equivalents | 1,161 | (438) |
Cash and cash equivalents - beginning | 871 | 1,371 |
Cash and cash equivalents - ending | 2,032 | 933 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | $ 3 | $ 6 |
Cash paid for income taxes | ||
Schedule of non-cash investing and financing activities: | ||
Issuance of common stock in settlement of accrued directors' fees | $ 103 |
NATURE OF BUSINESS
NATURE OF BUSINESS | 9 Months Ended |
Sep. 30, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE OF BUSINESS | Note 1 Nature of Business Direct Insite Corp. (Direct Insite or the Company) operates as a Software as a Service provider (SaaS), providing financial supply chain automation and workflow efficiencies within the Procure-to-Pay and Order-to-Cash processes. Specifically, Direct Insites global electronic invoice (e-invoice) management services automate complex manual business processes such as invoice validation, order matching, consolidation, dispute handling, and e-payment processing in a business-to-business transaction based fee for services business model. The Companys revenue comes from (i) recurring, on-going services that are billed monthly; and (ii) non-recurring, professional services derived from the configuration of the Companys software platform. Throughout the year, the Company operated redundant data centers in Miami, Florida, and Amsterdam, Netherlands. As described in Note 9, the Company has two major customers that accounted for 70.4% and 77.5% of the Companys revenue for the three months ended September 30, 2015 and 2014, respectively, and 70.6% and 76.6% of the Companys revenue for the nine months ended September 30, 2015 and 2014, respectively. Loss of either of these customers would have a material adverse effect on the Company. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | Note 2 - Summary of Significant Accounting Policies Interim Financial Information The accompanying unaudited condensed interim financial statements include the accounts of Direct Insite. The condensed balance sheet as of September 30, 2015, the condensed statements of operations for the three and nine months ended September 30, 2015 and 2014 and the condensed statements of cash flows for the nine months ended September 30, 2015 and 2014 have not been audited. These unaudited, condensed interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) for interim financial information and with the instructions to quarterly reports on Form 10-Q. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. The December 31, 2014 balance sheet was derived from audited financial statements, but does not include all disclosures required by GAAP. These interim condensed financial statements include all adjustments which management considers necessary for a fair presentation of the financial statements and consist of normal recurring items. The results of operations for the three and nine months ended September 30, 2015, are not necessarily indicative of results that may be expected for any other interim period or for the full year. These unaudited condensed financial statements should be read in conjunction with the audited financial statements and notes thereto for the year ended December 31, 2014 included in the Companys annual report on Form 10-K filed with the Securities and Exchange Commission (SEC) on March 25, 2015. Use of Estimates In preparing financial statements in conformity with accounting principles generally accepted in the United States of America, management makes estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the condensed financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. The most significant estimates are used in the accounting related to stock based compensation, the valuation allowance on deferred tax assets and capitalized internally developed software. Actual results could differ from those estimates. Revenue Recognition The Company records revenue in accordance with Accounting Standards Codification (ASC) 605, Revenue Recognition , Revenue Recognition in Financial Statements ● persuasive evidence of arrangements exist; ● delivery has occurred or services have been rendered; ● the sellers price is fixed and determinable; and ● collectability is reasonably assured. The following are the specific revenue recognition policies for each major category of revenue. Recurring (Ongoing Services) The Company provides transactional data processing services through its SaaS software solutions to its customers. The customer is charged a monthly fixed rate on a per transaction basis or a fixed fee based on monthly transaction volumes. Revenue is recognized as the services are provided. Non-Recurring (Professional Services) The Company provides non-recurring engineering services to its customers, which may include initial or additional development, modification, and customization services to the Companys software platform. Such services are billed based on: (i) hourly rates; or (ii) milestone billings. For hourly billed services, revenue is recognized when work is performed. For milestone billed services, revenue is recognized when the project milestone has been accepted by the customer. We do not sell software licenses, upgrades or enhancements, or post-contract customer services. Internally Developed Software The Company released the first phase of PAYBOX®, a next generation version of its accounts receivable platform in November 2014. It was designed for a global bank and is available to all Order-to-Cash process customers. According to ASC 350-40, Intangibles-Goodwill and Other-Internal-Use Software Income Taxes The Company accounts for income taxes using the asset and liability method. This method requires the determination of deferred tax assets and liabilities based on the differences between the financial statement and income tax basis of assets and liabilities, using enacted tax rates. Additionally, net deferred tax assets are adjusted by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some portion or all of the net deferred tax assets will not be realized. In addition, the Company expects to provide a valuation allowance on the remaining future tax benefits until it can sustain a level of profitability that demonstrates its ability to utilize the remaining assets, or other significant positive evidence arises that suggests its ability to utilize the remaining assets. The future realization of a portion of its reserved deferred tax assets related to tax benefits associated with the exercise of stock options, if and when realized, will not result in a tax benefit in the statement of operations, but rather will result in an increase in additional paid-in capital. The Company will continue to re-assess its reserves on deferred income tax assets in future periods on a quarterly basis. Earnings Per Share The Company displays earnings per share in accordance with ASC 260, Earnings Per Share The computation of diluted weighted average common shares outstanding used in the calculation of diluted earnings per share for the three and nine months ended September 30, 2015 and 2014 is as follows (in thousands): For the three months ended September 30, For the nine months ended September 30, 2015 2014 2015 2014 Basic weighted average shares outstanding 12,863 12,658 12,831 12,640 Stock Options 6 -- 2 19 Restricted stock grants 27 -- 21 9 Weighted average shares outstanding-diluted 12,896 12,658 12,854 12,668 Securities that could potentially dilute basic EPS in the future, that were not included in the computation of diluted EPS because to do so would have been anti-dilutive for the periods presented, consists of the following (in thousands): For the three months ended September 30, For the nine months ended September 30, 2015 2014 2015 2014 Options to purchase common stock 530 564 596 466 Unvested stock grants 7 67 10 31 Potential anti-dilutive common shares 537 631 606 497 Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and accounts receivable. The Company has cash deposits in excess of the maximum amounts insured by the Federal Depository Insurance Corporation at September 30, 2015 and December 31, 2014. The Company performs ongoing credit evaluations of its customers financial condition and, generally, requires no collateral from its customers. Concentrations of credit risk with respect to accounts receivable and revenue are disclosed in Note 9. Recently Issued and Adopted Accounting Pronouncements Management does not believe that any recently issued, but not yet effective accounting standards, if currently adopted, would have a material effect on its financial statements. |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 9 Months Ended |
Sep. 30, 2015 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | Note 3 Property and Equipment Property and equipment (with their respective useful lives) consist of the following at September 30, 2015 and December 31, 2014 (in thousands): 2015 2014 Computer equipment and purchased software (3 years) $ 1,372 $ 1,372 Internally developed software either placed or not yet placed in service (5 years) 1,075 907 Furniture and fixtures and leasehold improvements (5 7 years) 156 156 2,603 2,435 Less: accumulated depreciation and amortization (1,635 ) (1,415 ) Property and equipment, net $ 968 $ 1,020 Depreciation and amortization expense related to property and equipment for the three months ended September 30, 2015 and 2014 was approximately $64,000 and $83,000, respectively. Depreciation and amortization expense related to property and equipment for the nine months ended September 30, 2015 and 2014 was approximately $220,000 and $249,000, respectively. |
ACCOUNTS PAYABLE AND ACCRUED EX
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | 9 Months Ended |
Sep. 30, 2015 | |
Payables and Accruals [Abstract] | |
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | Note 4 Accounts Payable and Accrued Expenses Accounts payable and accrued expenses consist of the following at September 30, 2015 and December 31, 2014 (in thousands): 2015 2014 Trade accounts payable $ 268 $ 355 Sales taxes payable 539 539 Accrued directors fees 370 453 Other accrued expenses 376 442 Total accounts payable and accrued expenses $ 1,553 $ 1,789 |
CAPITAL LEASE OBLIGATIONS
CAPITAL LEASE OBLIGATIONS | 9 Months Ended |
Sep. 30, 2015 | |
Capital Lease Obligations [Abstract] | |
CAPITAL LEASE OBLIGATIONS | Note 5 Capital Lease Obligations The Company has equipment under two capital lease obligations expiring at various times through June 2016. The assets and liabilities under capital leases are recorded at the lower of the present value of the minimum lease payments or the fair values of the assets. The implied interest rates related to these capital leases range from 7.4% to 8.9%. The gross book value and the net book value of the related assets are approximately $77,000 and $21,000, respectively, as of September 30, 2015, and $77,000 and $40,000, respectively, as of December 31, 2014. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 9 Months Ended |
Sep. 30, 2015 | |
Stockholders' Equity Note [Abstract] | |
STOCKHOLDERS' EQUITY | Note 6 Stockholders Equity Preferred Stock The Company is authorized to issue 2,000,000 shares of preferred stock, of which none were issued and outstanding as of September 30, 2015 and December 31, 2014. Common Stock, Options and Stock Grants Nine Months Ended September 30, 2015 During the nine months ended September 30, 2015, 135,000 restricted common shares were granted with an aggregate grant date fair value of approximately $100,000. During this time, approximately 81,000 restricted common shares with an aggregate grant date fair value of approximately $65,000 vested. During the nine months ended September 30, 2015, the Company issued 111,602 shares of restricted common stock pursuant to the Companys Directors Deferred Compensation Plan dated January 1, 2008 (the Directors Deferred Compensation Plan). These shares were issued to settle approximately $103,715 of accrued directors fees to two former directors for past services. During the nine months ended September 30, 2015, the Company recognized approximately $92,000 of stock based compensation expense related to the expected vesting of 123,724 options. Outstanding options vest over a four year period, with 25% vesting on the first anniversary of the grant date and the remaining 75% vesting in equal monthly amounts through the fourth anniversary of the grant date. In March 2015, 90,000 options were awarded to employees. These options vest over three years with 33% vesting at the end of each of the three years. These options expire after a five year term. The Company estimated the grant date fair value of the stock options using the Black-Scholes-Merton option model and the following assumptions: volatility of 90%, risk free rate of 0.89%, dividend rate of zero, and expected term of 3.75 years. The grant date fair value of the stock options issued was determined to be approximately $44,100. Nine Months Ended September 30, 2014 During the nine months ended September 30, 2014, 55,728 shares of restricted common stock with an aggregate grant date fair value of approximately $53,000 vested. In connection with the reduction of the size of the board from seven to five directors and the ensuing restructuring of board compensation, members of the Board of Directors forfeited 40,398 shares of unvested restricted stock grants. The restructured board compensation approved by the Board of Directors provides that each non-Executive member of the Board would receive equal amounts: (i) $25,000 of the Companys common stock annually at the beginning of each year, vesting over a two year period, and (ii) $10,000 in cash to be paid 25% each quarter in arrears and which may be converted into common stock in accordance with the terms of the Directors Deferred Compensation Plan. During the nine months ended September 30, 2014, the Company granted 114,058 shares of restricted common stock with a grant date fair value of approximately $115,000. During the nine months ended September 30, 2014, the Company granted, to an employee of the Company, options to acquire 10,000 shares of common stock with an exercise price of $1.50 exercisable over a term of five years from the date of grant. The options vest over a four year period, with 25% vesting on the first anniversary of the grant date and the remaining 75% vesting in equal monthly amounts through the fourth anniversary of the grant date. The Company estimated the grant date fair value of the stock options using the Black-Scholes option model and the following assumptions: volatility of 95%, risk free rate of 0.8%, dividend rate of zero, and expected term of 3.75 years. The grant date fair value of the stock options issued was determined to be approximately $7,500. During the nine months ended September 30, 2014, the Company recognized approximately $83,000 of expenses related to the vesting of outstanding stock options. Stock incentive Plans The Company has granted options under multiple stock-based compensation plans that do not differ substantially in the characteristics of the awards. Nonqualified and incentive stock options have been granted to directors, officers and employees of the Company under the Companys stock option plans. Options generally vest over three to four years and expire five years from the date of the grant. On June 3, 2014, the Companys stockholders approved the adoption of the 2014 Stock Incentive Plan (the 2014 Plan). The 2014 Plan replaces the 2004 Stock Option/Stock Issuance Plan which expired on August 20, 2014. The 2014 Plan provides for the grant of non-qualified stock options, incentive stock options, and stock appreciation rights, shares of restricted stock, stock units and shares of unrestricted stock. Eligible participants include officers, employees and directors. The aggregate number of shares authorized for issuance under the 2014 Plan is 1,200,000, and is subject to adjustment as described in the 2014 Plan. As of September 30, 2015, 836,785 shares were available for issuance under the 2014 plan. Awards that expire or are cancelled without delivery of shares generally become available for issuance under the plans. The following is a summary of stock option activity for nine months ended September 30, 2015, relating to all of the Companys common stock plans: Weighted Average Shares Weighted Average Exercise Remaining Contractual Term Aggregate Intrinsic Value (in thousands) Price (in years) (in thousands) Outstanding at January 1, 2015 549 $ 1.30 2.72 $ -- Granted 90 $ 0.90 4.50 $ -- Expired (1 ) $ 1.15 -- $ -- Forfeited (18 ) $ 1.34 -- $ -- Outstanding at September 30, 2015 620 $ 1.24 2.32 $ 5 Exercisable at September 30, 2015 394 $ 1.25 1.71 $ -- The following table summarizes stock option information as of September 30, 2015: Weighted Average Number Outstanding Remaining Options Exercisable Exercise Prices (in thousands) Contractual Term (in thousands) $ 0.90 90 4.5 years $ 1.15 326 1.4 years 287 $ 1.20 24 0.7 years 24 $ 1.50 80 3.2 years 35 $ 1.65 100 3.0 years 48 Total 620 2.3 years 394 As of September 30, 2015, there was approximately $147,000 of unrecognized compensation costs related to stock options outstanding. Restricted Stock Grants A summary of the status of the Companys non-vested stock grants as of September 30, 2015 and changes during the nine months then ended is presented below: Non-Vested Shares Shares (in thousands) Weighted-Average Grant Date Fair Value Non-vested at January 1, 2015 51 $ 0.89 Granted 135 $ 0.74 Vested (81 ) $ 0.81 Non-vested at September 30, 2015 105 $ 0.76 The future expected expense as of September 30, 2015 for non-vested shares is approximately $79,000 and will be recognized as expense through December 31, 2016. |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | Note 7 Income Taxes The Company accounts for income taxes in accordance with ASC 740, Income Taxes The Company has identified its federal tax return and its state tax return in Florida as major tax jurisdictions, as defined in ASC 740. Based on the Companys evaluation, it has been concluded that there are no significant uncertain tax positions requiring recognition in the Companys financial statements. The Companys evaluation was performed for tax years ended 2011 through 2014, the only periods subject to examination. The Company believes that its income tax positions and deductions would be sustained upon audit and does not anticipate any adjustments that would result in a material change to its financial position. The Company has elected to classify interest and penalties incurred on income taxes, if any, as income tax expense. No interest or penalties on income taxes have been recorded during the three months ended September 30, 2015 and 2014. The Company does not expect its unrecognized tax benefit position to change during the next twelve months. Management is currently unaware of any issues under review that could result in significant payments, accruals or material deviations from its position. As of September 30, 2015, the Company has federal and state net operating loss carryforwards (NOLs) remaining of approximately $25 million and $20 million, respectively, which may be available to reduce taxable income, if any. Remaining federal and state net operating loss carry forwards expire from 2019 through 2034. However, Internal Revenue Code Section 382 rules limit the utilization of NOLs upon a change in control of a company. During 2014, the Company performed an evaluation as to whether a change in control had taken place. Management believes that there has been no change in control in accordance with Section 382. However, if it is determined that an ownership change has taken place, either historically or in the future, utilization of its NOLs could be subject to severe limitations, which could eliminate a substantial portion of the future income tax benefits of the NOLs. The NOL carryforward as of September, 2015 included approximately $1,193,000 related to windfall tax benefits for which a benefit would be recorded in additional paid-in capital if and when realized. |
COMMITMENT AND CONTINGENCIES
COMMITMENT AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENT AND CONTINGENCIES | Note 8 Commitment and Contingencies The Company had an employment agreement with Matthew E. Oakes, Chief Executive Officer and Chairman of the Board of Directors, for a term effective June 1, 2013 through December 31, 2015. On February 20, 2015, Mr. Oakes employment agreement was superseded by a new employment agreement extending the term through December 31, 2017. The agreement provides for a base salary of $24,583 per month, discretionary and annual incentive bonuses based on the Companys performance in achieving prescribed revenue and earnings before interest and taxes (EBIT) targets. The agreement also provides for reimbursement of all out-of-pocket expenses reasonably incurred by him in the performance of his duties hereunder and certain severance benefits in the event of termination prior to the expiration date. If Mr. Oakes is terminated without cause or resigns from employment for good reason (as defined within Mr. Oakes employment agreement), he would receive one year of base salary and COBRA coverage at the Companys expense. The Company shall continue to make lease payments on the corporate apartment located in Fort Lauderdale, Florida and utilized by Mr. Oakes through the date of termination of such lease on December 31, 2017. |
MAJOR CUSTOMERS
MAJOR CUSTOMERS | 9 Months Ended |
Sep. 30, 2015 | |
MAJOR CUSTOMERS [Abstract] | |
MAJOR CUSTOMERS | Note 9 Major Customers Two customers, HP Enterprise Services (HP) and International Business Machines Corp. (IBM) accounted for a significant portion of the Companys revenues for the respective three and nine month periods ended September 30, 2015 and 2014 as follows: For the three months ended For the nine months ended 2015 2014 2015 2014 HP Customer A 15.7 % 14.8 % 14.7 % 14.5 % HP Customer B 11.7 % 11.9 % 11.8 % 14.3 % HP Customer C 6.6 % 6.5 % 6.3 % 8.5 % Total HP 34.0 % 33.2 % 32.8 % 37.3 % IBM 36.4 % 44.3 % 37.8 % 39.3 % Total major customers 70.4 % 77.5 % 70.6 % 76.6 % Others 29.6 % 22.5 % 29.4 % 23.4 % Total 100.0 % 100.0 % 100.0 % 100.0 % As of September 30, 2015 and December 31, 2014, HP and IBM accounted for a significant portion of the Companys accounts receivable as follows (in thousands): September 30, 2015 December 31, 2014 HP $ 557 $ 1,037 IBM 467 784 Total $ 1,024 $ 1,821 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2015 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | Note 10 Subsequent Events The Company evaluates events that have occurred after the balance sheet date but before the financial statements are issued. Based upon the evaluation, the Company did not identify any recognized or non-recognized subsequent events that would have required adjustment or disclosure in the condensed financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN16
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
INTERIM FINANCIAL INFORMATION | Interim Financial Information The accompanying unaudited condensed interim financial statements include the accounts of Direct Insite. The condensed balance sheet as of September 30, 2015, the condensed statements of operations for the three and nine months ended September 30, 2015 and 2014 and the condensed statements of cash flows for the nine months ended September 30, 2015 and 2014 have not been audited. These unaudited, condensed interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) for interim financial information and with the instructions to quarterly reports on Form 10-Q. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. The December 31, 2014 balance sheet was derived from audited financial statements, but does not include all disclosures required by GAAP. These interim condensed financial statements include all adjustments which management considers necessary for a fair presentation of the financial statements and consist of normal recurring items. The results of operations for the three and nine months ended September 30, 2015, are not necessarily indicative of results that may be expected for any other interim period or for the full year. These unaudited condensed financial statements should be read in conjunction with the audited financial statements and notes thereto for the year ended December 31, 2014 included in the Companys annual report on Form 10-K filed with the Securities and Exchange Commission (SEC) on March 25, 2015. |
USE OF ESTIMATES | Use of Estimates In preparing financial statements in conformity with accounting principles generally accepted in the United States of America, management makes estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the condensed financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. The most significant estimates are used in the accounting related to stock based compensation, the valuation allowance on deferred tax assets and capitalized internally developed software. Actual results could differ from those estimates. |
REVENUE RECOGNITION | Revenue Recognition The Company records revenue in accordance with Accounting Standards Codification (ASC) 605, Revenue Recognition , Revenue Recognition in Financial Statements ● persuasive evidence of arrangements exist; ● delivery has occurred or services have been rendered; ● the sellers price is fixed and determinable; and ● collectability is reasonably assured. The following are the specific revenue recognition policies for each major category of revenue. Recurring (Ongoing Services) The Company provides transactional data processing services through its SaaS software solutions to its customers. The customer is charged a monthly fixed rate on a per transaction basis or a fixed fee based on monthly transaction volumes. Revenue is recognized as the services are provided. Non-Recurring (Professional Services) The Company provides non-recurring engineering services to its customers, which may include initial or additional development, modification, and customization services to the Companys software platform. Such services are billed based on: (i) hourly rates; or (ii) milestone billings. For hourly billed services, revenue is recognized when work is performed. For milestone billed services, revenue is recognized when the project milestone has been accepted by the customer. We do not sell software licenses, upgrades or enhancements, or post-contract customer services. |
INTERNALLY DEVELOPED SOFTWARE | Internally Developed Software The Company released the first phase of PAYBOX®, a next generation version of its accounts receivable platform in November 2014. It was designed for a global bank and is available to all Order-to-Cash process customers. According to ASC 350-40, Intangibles-Goodwill and Other-Internal-Use Software |
INCOME TAXES | Income Taxes The Company accounts for income taxes using the asset and liability method. This method requires the determination of deferred tax assets and liabilities based on the differences between the financial statement and income tax basis of assets and liabilities, using enacted tax rates. Additionally, net deferred tax assets are adjusted by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some portion or all of the net deferred tax assets will not be realized. In addition, the Company expects to provide a valuation allowance on the remaining future tax benefits until it can sustain a level of profitability that demonstrates its ability to utilize the remaining assets, or other significant positive evidence arises that suggests its ability to utilize the remaining assets. The future realization of a portion of its reserved deferred tax assets related to tax benefits associated with the exercise of stock options, if and when realized, will not result in a tax benefit in the statement of operations, but rather will result in an increase in additional paid-in capital. The Company will continue to re-assess its reserves on deferred income tax assets in future periods on a quarterly basis. |
EARNINGS PER SHARE | Earnings Per Share The Company displays earnings per share in accordance with ASC 260, Earnings Per Share The computation of diluted weighted average common shares outstanding used in the calculation of diluted earnings per share for the three and nine months ended September 30, 2015 and 2014 is as follows (in thousands): For the three months ended September 30, For the nine months ended September 30, 2015 2014 2015 2014 Basic weighted average shares outstanding 12,863 12,658 12,831 12,640 Stock Options 6 -- 2 19 Restricted stock grants 27 -- 21 9 Weighted average shares outstanding-diluted 12,896 12,658 12,854 12,668 Securities that could potentially dilute basic EPS in the future, that were not included in the computation of diluted EPS because to do so would have been anti-dilutive for the periods presented, consists of the following (in thousands): For the three months ended September 30, For the nine months ended September 30, 2015 2014 2015 2014 Options to purchase common stock 530 564 596 466 Unvested stock grants 7 67 10 31 Potential anti-dilutive common shares 537 631 606 497 |
CONCENTRATION OF CREDIT RISK | Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and accounts receivable. The Company has cash deposits in excess of the maximum amounts insured by the Federal Depository Insurance Corporation at September 30, 2015 and December 31, 2014. The Company performs ongoing credit evaluations of its customers financial condition and, generally, requires no collateral from its customers. Concentrations of credit risk with respect to accounts receivable and revenue are disclosed in Note 9. |
RECENTLY ISSUED AND ADOPTED ACCOUNTING PRONOUNCEMENTS | Recently Issued and Adopted Accounting Pronouncements Management does not believe that any recently issued, but not yet effective accounting standards, if currently adopted, would have a material effect on its financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN17
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Computation of basic and diluted earnings per share | The computation of diluted weighted average common shares outstanding used in the calculation of diluted earnings per share for the three and nine months ended September 30, 2015 and 2014 is as follows (in thousands): For the three months ended September 30, For the nine months ended September 30, 2015 2014 2015 2014 Basic weighted average shares outstanding 12,863 12,658 12,831 12,640 Stock Options 6 -- 2 19 Restricted stock grants 27 -- 21 9 Weighted average shares outstanding-diluted 12,896 12,658 12,854 12,668 |
Antidilutive securities excluded from computation of earnings per share | Securities that could potentially dilute basic EPS in the future, that were not included in the computation of diluted EPS because to do so would have been anti-dilutive for the periods presented, consists of the following (in thousands): For the three months ended September 30, For the nine months ended September 30, 2015 2014 2015 2014 Options to purchase common stock 530 564 596 466 Unvested stock grants 7 67 10 31 Potential anti-dilutive common shares 537 631 606 497 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and equipment (with their respective useful lives) consist of the following at September 30, 2015 and December 31, 2014 (in thousands): 2015 2014 Computer equipment and purchased software (3 years) $ 1,372 $ 1,372 Internally developed software either placed or not yet placed in service (5 years) 1,075 907 Furniture and fixtures and leasehold improvements (5 7 years) 156 156 2,603 2,435 Less: accumulated depreciation and amortization (1,635 ) (1,415 ) Property and equipment, net $ 968 $ 1,020 |
ACCOUNTS PAYABLE AND ACCRUED 19
ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Payables and Accruals [Abstract] | |
Accounts Payable and Accrued Expenses | Accounts payable and accrued expenses consist of the following at September 30, 2015 and December 31, 2014 (in thousands): 2015 2014 Trade accounts payable $ 268 $ 355 Sales taxes payable 539 539 Accrued directors fees 370 453 Other accrued expenses 376 442 Total accounts payable and accrued expenses $ 1,553 $ 1,789 |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Stockholders' Equity Note [Abstract] | |
Stock Option Activity | The following is a summary of stock option activity for nine months ended September 30, 2015, relating to all of the Companys common stock plans: Weighted Average Shares Weighted Average Exercise Remaining Contractual Term Aggregate Intrinsic Value (in thousands) Price (in years) (in thousands) Outstanding at January 1, 2015 549 $ 1.30 2.72 $ -- Granted 90 $ 0.90 4.50 $ -- Expired (1 ) $ 1.15 -- $ -- Forfeited (18 ) $ 1.34 -- $ -- Outstanding at September 30, 2015 620 $ 1.24 2.32 $ 5 Exercisable at September 30, 2015 394 $ 1.25 1.71 $ -- |
Stock Option Information | The following table summarizes stock option information as of September 30, 2015: Weighted Average Number Outstanding Remaining Options Exercisable Exercise Prices (in thousands) Contractual Term (in thousands) $ 0.90 90 4.5 years $ 1.15 326 1.4 years 287 $ 1.20 24 0.7 years 24 $ 1.50 80 3.2 years 35 $ 1.65 100 3.0 years 48 Total 620 2.3 years 394 |
Non-vested Stock Grants | A summary of the status of the Companys non-vested stock grants as of September 30, 2015 and changes during the nine months then ended is presented below: Non-Vested Shares Shares (in thousands) Weighted-Average Grant Date Fair Value Non-vested at January 1, 2015 51 $ 0.89 Granted 135 $ 0.74 Vested (81 ) $ 0.81 Non-vested at September 30, 2015 105 $ 0.76 |
MAJOR CUSTOMERS (Tables)
MAJOR CUSTOMERS (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Revenues [Member] | |
Concentration Risk [Line Items] | |
Customers Accounted for Significant Portion of Revenues and Accounts Receivable | Two customers, HP Enterprise Services (HP) and International Business Machines Corp. (IBM) accounted for a significant portion of the Companys revenues for the respective three and nine month periods ended September 30, 2015 and 2014 as follows: For the three months ended For the nine months ended 2015 2014 2015 2014 HP Customer A 15.7 % 14.8 % 14.7 % 14.5 % HP Customer B 11.7 % 11.9 % 11.8 % 14.3 % HP Customer C 6.6 % 6.5 % 6.3 % 8.5 % Total HP 34.0 % 33.2 % 32.8 % 37.3 % IBM 36.4 % 44.3 % 37.8 % 39.3 % Total major customers 70.4 % 77.5 % 70.6 % 76.6 % Others 29.6 % 22.5 % 29.4 % 23.4 % Total 100.0 % 100.0 % 100.0 % 100.0 % |
Accounts Receivable [Member] | |
Concentration Risk [Line Items] | |
Customers Accounted for Significant Portion of Revenues and Accounts Receivable | As of September 30, 2015 and December 31, 2014, HP and IBM accounted for a significant portion of the Companys accounts receivable as follows (in thousands): September 30, 2015 December 31, 2014 HP $ 557 $ 1,037 IBM 467 784 Total $ 1,024 $ 1,821 |
NATURE OF BUSINESS (Details Nar
NATURE OF BUSINESS (Details Narrative) - Customer | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Concentration Risk [Line Items] | ||||
Number of major customers | 2 | |||
Revenues [Member] | ||||
Concentration Risk [Line Items] | ||||
Ratio of revenues from major customers to total revenues (in hundredths) | 100.00% | 100.00% | 100.00% | 100.00% |
Revenues [Member] | Customers One [Member] | ||||
Concentration Risk [Line Items] | ||||
Ratio of revenues from major customers to total revenues (in hundredths) | 70.40% | 77.50% | 70.60% | 76.60% |
SUMMARY OF SIGNIFICANT ACCOUN23
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Earnings Per Share [Abstract] | ||||
Basic weighted average shares outstanding | 12,863 | 12,658 | 12,831 | 12,640 |
Stock Options | 6 | 2 | 19 | |
Restricted stock grants | 27 | 21 | 9 | |
Diluted weighted average shares outstanding | 12,896 | 12,658 | 12,854 | 12,668 |
SUMMARY OF SIGNIFICANT ACCOUN24
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Accounting Policies [Abstract] | ||||
Options to purchase common stock | 530 | 564 | 596 | 466 |
Unvested stock grants | 7 | 67 | 10 | 31 |
Potential anti-dilutive common shares | 537 | 631 | 606 | 497 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Dec. 31, 2014 | |
Summary of property and equipment [Abstract] | ||
Property and equipment, gross | $ 2,603 | $ 2,435 |
Less: accumulated depreciation and amortization | (1,635) | (1,415) |
Property and equipment, net | 968 | 1,020 |
Computer Equipments And Purchased Software [Member] | ||
Summary of property and equipment [Abstract] | ||
Property and equipment, gross | $ 1,372 | 1,372 |
Estimated useful lives | 3 years | |
Software Development [Member] | ||
Summary of property and equipment [Abstract] | ||
Property and equipment, gross | $ 1,075 | 907 |
Estimated useful lives | 5 years | |
Furnitures and fixtures and leasehold improvements [Member] | ||
Summary of property and equipment [Abstract] | ||
Property and equipment, gross | $ 156 | $ 156 |
Furnitures and fixtures and leasehold improvements [Member] | Minimum [Member] | ||
Summary of property and equipment [Abstract] | ||
Estimated useful lives | 5 years | |
Furnitures and fixtures and leasehold improvements [Member] | Maximum [Member] | ||
Summary of property and equipment [Abstract] | ||
Estimated useful lives | 7 years |
PROPERTY AND EQUIPMENT (Detai26
PROPERTY AND EQUIPMENT (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation and amortization | $ 64 | $ 83 | $ 220 | $ 249 |
ACCOUNTS PAYABLE AND ACCRUED 27
ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Summary of Accounts Payable and Accrued Expenses [Abstract] | ||
Trade accounts payable | $ 268 | $ 355 |
Sales taxes payable | 539 | 539 |
Accrued directors' fees | 370 | 453 |
Other accrued expenses | 376 | 442 |
Total accounts payable and accrued expenses | $ 1,553 | $ 1,789 |
CAPITAL LEASE OBLIGATIONS (Deta
CAPITAL LEASE OBLIGATIONS (Details) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015USD ($) | Dec. 31, 2014USD ($) | |
Capital Lease Obligations [Abstract] | ||
Number of capital lease equipments obligation | 2 | |
Expiration period of capital lease obligations | Jun. 30, 2016 | |
Gross book value of capital leased assets | $ 77 | $ 77 |
Net book value of capital leased assets | $ 21 | $ 40 |
Minimum [Member] | ||
Capital Lease Obligations [Abstract] | ||
Interest rate capital leases (in hundredths) | 7.40% | |
Maximum [Member] | ||
Capital Lease Obligations [Abstract] | ||
Interest rate capital leases (in hundredths) | 8.90% |
STOCKHOLDERS' EQUITY (Details)
STOCKHOLDERS' EQUITY (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Shares | ||
Outstanding at January 1, 2015 | 549 | |
Granted | 90 | |
Expired | (1) | |
Forfeited | (18) | |
Outstanding at June 30, 2015 | 620 | |
Exercisable at June 30, 2015 | 394 | |
Weighted Average Exercise Price | ||
Outstanding at January 1, 2015 | $ 1.30 | |
Granted | 0.90 | |
Expired | 1.15 | |
Forfeited | 1.34 | |
Outstanding at June 30, 2015 | 1.24 | |
Exercisable at June 30, 2015 | $ 1.25 | |
Weighted Average Remaining Contractual Term (in years) | ||
Outstanding | 2 years 3 months 18 days | 2 years 8 months 19 days |
Granted | 4 years 6 months | |
Exercisable at June 30, 2015 | 1 year 8 months 16 days | |
Aggregate Intrinsic Value (in thousands) | $ 5 |
STOCKHOLDERS' EQUITY (Details 1
STOCKHOLDERS' EQUITY (Details 1) - shares | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Number Outstanding | 620 | 549 | |
Weighted Average Remaining Contractual Life | 2 years 3 months 18 days | 2 years 8 months 19 days | |
Options Exercisable | 394 | ||
Exercise Prices 0.90 [Member] | |||
Number Outstanding | 90,000 | ||
Weighted Average Remaining Contractual Life | 4 years 6 months | ||
Options Exercisable | 0 | ||
Exercise Price 1.15 [Member] | |||
Number Outstanding | 326,000 | ||
Weighted Average Remaining Contractual Life | 1 year 4 months 24 days | ||
Options Exercisable | 287 | ||
Exercise Price 1.20 [Member] | |||
Number Outstanding | 24,000 | ||
Weighted Average Remaining Contractual Life | 8 months 12 days | ||
Options Exercisable | 24 | ||
Exercise Price 1.50 [Member] | |||
Number Outstanding | 80,000 | ||
Weighted Average Remaining Contractual Life | 3 years 2 months 12 days | ||
Options Exercisable | 35 | ||
Exercise Price 1.65 [Member] | |||
Number Outstanding | 100,000 | ||
Weighted Average Remaining Contractual Life | 3 years | ||
Options Exercisable | 48 |
STOCKHOLDERS' EQUITY (Details 2
STOCKHOLDERS' EQUITY (Details 2) | 9 Months Ended |
Sep. 30, 2015$ / sharesshares | |
Non-Vested Shares | |
Non-Vested at January 1, 2015 | shares | 51 |
Granted | shares | 135 |
Vested | shares | (81) |
Non-vested at September 30, 2015 | shares | 105 |
Weighted-Average Grant Date Fair Value | |
Non-Vested at January 1, 2015 | $ 0.89 |
Granted | 0.74 |
Vested | 0.81 |
Non-vested at September 30, 2015 | $ 0.76 |
STOCKHOLDERS' EQUITY (Details N
STOCKHOLDERS' EQUITY (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Preferred stock authorized (in shares) | 2,000,000 | 2,000,000 | |
Preferred stock, issued (in shares) | 0 | 0 | |
Preferred stock, outstanding (in shares) | 0 | 0 | |
Shares issued for compensation, fair value | $ 7,500 | ||
Stock based compensation expense | $ 92,000 | $ 83,000 | |
Stock option vested during the period | 123,724 | ||
Vesting period of stock option | 4 years | ||
Percentage of stock options vesting up- to first anniversary | 25.00% | 25.00% | |
Percentage of stock options vesting from year two to fourth anniversary | 75.00% | 75.00% | |
Percentage of stock options vesting for second three years | 33.00% | ||
Volatility rate | 90.00% | 95.00% | |
Risk free rate | 89.00% | 8.00% | |
Dividend rate | 0.00% | 0.00% | |
Expected term | 3 years 9 months | 3 years 9 months | |
Stock option granted | 90 | ||
Stock option granted exercise price | $ 0.90 | ||
Number of shares authorized | 90,000 | ||
Unrecognized compensation costs | $ 147,000 | ||
Unrecognized compensation future expected expense | $ 79,000 | ||
2014 Plan [Member] | |||
Number of shares authorized | 1,200,000 | ||
Shares available for issuance | 836,785 | ||
Employee [Member] | |||
Stock option granted | 10,000 | ||
Stock option granted exercise price | $ 1.50 | ||
Restricted Stock [Member] | |||
Shares issued for compensation | 111,602 | 55,728 | |
Shares issued for compensation, fair value | $ 53,000 | ||
Restricted Stock [Member] | Director [Member] | |||
Shares issued for compensation | 114,058 | ||
Shares issued for compensation, fair value | $ 115,000 |
INCOME TAXES (Details Narrative
INCOME TAXES (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Dec. 31, 2014 | |
Unrecognized tax benefits | $ 0 | $ 0 | $ 0 | |
Unrecognized tax benefits, interest and penalties | 0 | $ 0 | ||
Period for which the position in unrecognized tax benefit is not expected to change | 12 months | |||
Net operating loss carryforwards related to tax benefit | 1,193 | $ 1,193 | ||
State and Local Jurisdiction [Member] | ||||
Operating loss carryforwards | 20,000 | 20,000 | ||
Federal Tax Authority [Member] | ||||
Operating loss carryforwards | $ 25,000 | $ 25,000 | ||
Minimum [Member] | ||||
Operating loss carryforwards, expiration dates | Dec. 31, 2019 | |||
Maximum [Member] | ||||
Operating loss carryforwards, expiration dates | Dec. 31, 2034 |
COMMITMENT AND CONTINGENCIES (D
COMMITMENT AND CONTINGENCIES (Details Narrative) $ in Thousands | 9 Months Ended |
Sep. 30, 2015USD ($) | |
Chief Executive Officer [Member] | |
Employment Agreement [Abstract] | |
Base salary per month as per employment agreements | $ 24,583 |
MAJOR CUSTOMERS (Details)
MAJOR CUSTOMERS (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015USD ($) | Sep. 30, 2014 | Sep. 30, 2015USD ($)Customer | Sep. 30, 2014 | Dec. 31, 2014USD ($) | |
Concentration Risk [Line Items] | |||||
Number of major customers | Customer | 2 | ||||
Revenues [Member] | |||||
Summary of customers accounted for significant portion of revenues [Abstract] | |||||
Major customer, revenues (in hundredths) | 100.00% | 100.00% | 100.00% | 100.00% | |
Revenues [Member] | HP Customer A [Member] | |||||
Summary of customers accounted for significant portion of revenues [Abstract] | |||||
Major customer, revenues (in hundredths) | 15.70% | 14.80% | 14.70% | 14.50% | |
Revenues [Member] | HP Customer B [Member] | |||||
Summary of customers accounted for significant portion of revenues [Abstract] | |||||
Major customer, revenues (in hundredths) | 11.70% | 11.90% | 11.80% | 14.30% | |
Revenues [Member] | HP Customer C [Member] | |||||
Summary of customers accounted for significant portion of revenues [Abstract] | |||||
Major customer, revenues (in hundredths) | 6.60% | 6.50% | 6.30% | 8.50% | |
Revenues [Member] | HP [Member] | |||||
Summary of customers accounted for significant portion of revenues [Abstract] | |||||
Major customer, revenues (in hundredths) | 34.00% | 33.20% | 32.80% | 37.30% | |
Revenues [Member] | I B M [Member] | |||||
Summary of customers accounted for significant portion of revenues [Abstract] | |||||
Major customer, revenues (in hundredths) | 36.40% | 44.30% | 37.80% | 39.30% | |
Revenues [Member] | Total Major Customers [Member] | |||||
Summary of customers accounted for significant portion of revenues [Abstract] | |||||
Major customer, revenues (in hundredths) | 70.40% | 77.50% | 70.60% | 76.60% | |
Revenues [Member] | Others [Member] | |||||
Summary of customers accounted for significant portion of revenues [Abstract] | |||||
Major customer, revenues (in hundredths) | 29.60% | 22.50% | 29.40% | 23.40% | |
Accounts Receivable [Member] | |||||
Summary of customers accounted for significant portion of accounts receivable [Abstract] | |||||
Major customer, accounts receivable | $ 1,024 | $ 1,024 | $ 1,821 | ||
Accounts Receivable [Member] | HP [Member] | |||||
Summary of customers accounted for significant portion of accounts receivable [Abstract] | |||||
Major customer, accounts receivable | 557 | 557 | 1,037 | ||
Accounts Receivable [Member] | I B M [Member] | |||||
Summary of customers accounted for significant portion of accounts receivable [Abstract] | |||||
Major customer, accounts receivable | $ 467 | $ 467 | $ 784 |