Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2017 | Aug. 17, 2017 | |
Document And Entity Information | ||
Entity Registrant Name | DIGITAL POWER CORP | |
Entity Central Index Key | 896,493 | |
Document Type | 10-Q | |
Trading Symbol | DPW | |
Document Period End Date | Jun. 30, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity a Well-known Seasoned Issuer | No | |
Entity a Voluntary Filer | No | |
Entity's Reporting Status Current | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 13,469,509 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2,017 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 443 | $ 996 |
Accounts receivable, net | 1,253 | 1,439 |
Inventories, net | 1,609 | 1,122 |
Prepaid expenses and other current assets | 659 | 285 |
TOTAL CURRENT ASSETS | 3,964 | 3,842 |
Restricted cash | 100 | |
Intangible assets | 93 | |
Goodwill | 6,002 | |
Property and equipment, net | 623 | 570 |
Investments - related parties, net of original issue discount of $103 and $45, respectively | 2,582 | 1,036 |
Other investments | 398 | |
Deposits and loans | 219 | 24 |
TOTAL ASSETS | 13,981 | 5,472 |
CURRENT LIABILITIES | ||
Accounts payable and accrued expenses | 2,835 | 1,231 |
Accounts payable and accrued expenses, related party | 100 | |
Revolving credit facility | 612 | |
Notes payable | 1,247 | 250 |
Notes payable, related parties | 278 | |
Convertible notes payable | 250 | |
Other current liabilities | 427 | 398 |
TOTAL CURRENT LIABILITIES | 5,749 | 1,879 |
LONG TERM LIABILITIES | ||
Notes payable | 569 | |
Notes payable, related parties | 128 | |
Convertible notes payable, related party, net of discount of $408 and $496, respectively, at June 30, 2017 and December 31, 2016 | 122 | 34 |
TOTAL LIABILITIES | 6,568 | 1,913 |
COMMITMENTS AND CONTINGENCIES | ||
STOCKHOLDERS' EQUITY | ||
Series A Redeemable Convertible Preferred Stock, no par value - 500,000 shares authorized; nil shares issued and outstanding at June 30, 2017 and December 31, 2016 | ||
Preferred Stock, no par value - 151,224 shares authorized; nil shares issued and outstanding at June 30, 2017 and December 31, 2016 | ||
Common Stock, no par value - 30,000,000 shares authorized; 12,304,546 and 7,677,637 shares issued and outstanding at June 30, 2017 and December 31, 2016, respectively | ||
Additional paid-in capital | 22,519 | 16,537 |
Accumulated deficit | (15,218) | (12,158) |
Accumulated other comprehensive loss | (721) | (820) |
TOTAL DIGITAL POWER STOCKHOLDERS' EQUITY | 6,580 | 3,559 |
Non-controlling interest | 833 | |
TOTAL EQUITY | 7,413 | 3,559 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 13,981 | 5,472 |
Series A Preferred Stock [Member] | ||
STOCKHOLDERS' EQUITY | ||
Series A Redeemable Convertible Preferred Stock, no par value - 500,000 shares authorized; nil shares issued and outstanding at June 30, 2017 and December 31, 2016 | ||
Series B Preferred Stock [Member] | ||
STOCKHOLDERS' EQUITY | ||
Series A Redeemable Convertible Preferred Stock, no par value - 500,000 shares authorized; nil shares issued and outstanding at June 30, 2017 and December 31, 2016 | ||
Series C Preferred Stock [Member] | ||
STOCKHOLDERS' EQUITY | ||
Series A Redeemable Convertible Preferred Stock, no par value - 500,000 shares authorized; nil shares issued and outstanding at June 30, 2017 and December 31, 2016 | ||
Series D Preferred Stock [Member] | ||
STOCKHOLDERS' EQUITY | ||
Series A Redeemable Convertible Preferred Stock, no par value - 500,000 shares authorized; nil shares issued and outstanding at June 30, 2017 and December 31, 2016 | ||
Series E Preferred Stock [Member] | ||
STOCKHOLDERS' EQUITY | ||
Series A Redeemable Convertible Preferred Stock, no par value - 500,000 shares authorized; nil shares issued and outstanding at June 30, 2017 and December 31, 2016 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Investments - related parties, original issue discount | $ 103 | $ 45 |
Unamortized issuance discount | $ 408 | $ 496 |
Preferred stock, par value (in dollars per share) | $ 0 | $ 0 |
Preferred stock, authorized | 151,224 | 151,224 |
Preferred stock, issued | 0 | 0 |
Preferred stock, outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0 | $ 0 |
Common stock, authorized | 30,000,000 | 30,000,000 |
Common stock, issued | 12,304,546 | 7,677,637 |
Common stock, outstanding | 12,304,546 | 7,677,637 |
Series A Preferred Stock [Member] | ||
Convertible redeemable preferred stock, par value (in dollars per share) | $ 0 | $ 0 |
Convertible redeemable preferred stock, authorized | 500,000 | 500,000 |
Convertible redeemable preferred stock, issued | 0 | 0 |
Convertible redeemable preferred stock, outstanding | 0 | 0 |
Preferred stock, authorized | 500,000 | |
Series B Preferred Stock [Member] | ||
Convertible redeemable preferred stock, par value (in dollars per share) | $ 0 | $ 0 |
Convertible redeemable preferred stock, authorized | 500,000 | 500,000 |
Convertible redeemable preferred stock, issued | 100,000 | 100,000 |
Convertible redeemable preferred stock, outstanding | 100,000 | 0 |
Convertible redeemable preferred stock, stated value (in dollars per share) | $ 10 | $ 10 |
Convertible redeemable preferred stock, liquidation preference | $ 1,000 | $ 0 |
Preferred stock, authorized | 500,000 | |
Series C Preferred Stock [Member] | ||
Convertible redeemable preferred stock, par value (in dollars per share) | $ 0 | $ 0 |
Convertible redeemable preferred stock, authorized | 460,000 | 460,000 |
Convertible redeemable preferred stock, issued | 455,002 | 0 |
Convertible redeemable preferred stock, outstanding | 455,002 | 0 |
Convertible redeemable preferred stock, stated value (in dollars per share) | $ 2.40 | $ 2.40 |
Convertible redeemable preferred stock, liquidation preference | $ 1,092 | $ 0 |
Preferred stock, authorized | 460,000 | |
Series D Preferred Stock [Member] | ||
Convertible redeemable preferred stock, par value (in dollars per share) | $ 0 | $ 0 |
Convertible redeemable preferred stock, authorized | 378,776 | 378,776 |
Convertible redeemable preferred stock, issued | 378,776 | 0 |
Convertible redeemable preferred stock, outstanding | 378,776 | 0 |
Convertible redeemable preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Convertible redeemable preferred stock, stated value (in dollars per share) | $ 0.01 | 0.01 |
Preferred stock, authorized | 378,776 | |
Series E Preferred Stock [Member] | ||
Convertible redeemable preferred stock, par value (in dollars per share) | $ 0 | $ 0 |
Convertible redeemable preferred stock, authorized | 10,000 | 10,000 |
Convertible redeemable preferred stock, issued | 10,000 | 0 |
Convertible redeemable preferred stock, outstanding | 10,000 | 0 |
Convertible redeemable preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Convertible redeemable preferred stock, stated value (in dollars per share) | $ 45 | $ 45 |
Preferred stock, authorized | 10,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHNSIVE LOSS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Income Statement [Abstract] | ||||
Revenue | $ 1,822 | $ 2,064 | $ 3,450 | $ 3,777 |
Cost of revenue | 1,092 | 1,310 | 2,012 | 2,403 |
Gross profit | 730 | 754 | 1,438 | 1,374 |
Operating expenses | ||||
Engineering and product development | 265 | 170 | 492 | 364 |
Selling and marketing | 327 | 233 | 622 | 488 |
General and administrative | 1,582 | 340 | 2,555 | 711 |
Total operating expenses | 2,174 | 743 | 3,669 | 1,563 |
Loss from operations | (1,444) | 11 | (2,231) | (189) |
Interest (expense) income, net | (407) | 55 | (614) | 62 |
Net loss | (1,851) | 66 | (2,845) | (127) |
Less: Net loss attributable to non-controlling interest | 112 | 112 | ||
Net loss attributable to Digital Power Corp | (1,739) | 66 | (2,733) | (127) |
Preferred deemed dividends | (319) | (319) | ||
Preferred dividends | (8) | (8) | ||
Loss available to common shareholders | $ (2,066) | $ 66 | $ (3,060) | $ (127) |
Basic and diluted net loss per common share (in dollars per share) | $ (0.2) | $ 0.01 | $ (0.32) | $ (0.02) |
Basic and diluted weighted average common shares outstanding (in shares) | 10,467,658 | 6,775,971 | 9,430,945 | 6,775,971 |
Comprehensive Loss | ||||
Loss available to common shareholders | $ (2,066) | $ 66 | $ (3,060) | $ (127) |
Other comprehensive income (loss) | ||||
Change in net foreign currency translation adjustments | 78 | (152) | 99 | (210) |
Other comprehensive income (loss) | 78 | (152) | 99 | (210) |
Total Comprehensive loss | $ (1,988) | $ (86) | $ (2,961) | $ (337) |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Cash flows from operating activities: | ||
Net loss | $ (2,845) | $ (127) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation | 78 | 84 |
Amortization | 2 | |
Interest expense - debt discount | 587 | |
Accretion of original issue discount on notes receivable - related party | (19) | |
Interest expense on extinguishment of demand notes to common stock | 13 | |
Stock-based compensation | 752 | 87 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 651 | 4 |
Inventories | 216 | 256 |
Prepaid expenses and other current assets | (228) | 53 |
Other assets | (82) | |
Accounts payable and accrued expenses | (91) | (25) |
Accounts payable, related parties | 100 | |
Other current liabilities | (307) | (198) |
Net cash (used in) provided by operating activities | (1,173) | 134 |
Cash flows from investing activities: | ||
Purchase of property and equipment | (21) | (74) |
Investments - related party | (1,527) | |
Investments - others | (95) | |
Loan to third party | (489) | |
Net cash used in investing activities | (2,132) | (74) |
Cash flows from financing activities: | ||
Gross proceeds from sales of common stock and warrants | 300 | |
Proceeds from issuance of preferred stock | 1,540 | |
Financing cost in connection with sales of equity securities | (275) | |
Proceeds from convertible notes payable | 354 | |
Proceeds from notes payable - related party | 350 | |
Proceeds from notes payable | 710 | |
Payments on revolving credit facility, net | (268) | |
Net cash provided by financing activities | 2,711 | |
Effect of exchange rate on cash and cash equivalents | 41 | (89) |
Net decrease in cash and cash equivalents | (553) | (29) |
Cash and cash equivalents at beginning of period | 996 | 1,241 |
Cash and cash equivalents at end of period | 443 | 1,212 |
Supplemental disclosures of cash flow information: | ||
Cash paid during the period for interest | 32 | |
Non-cash investing and financing activities: | ||
Cancellation of notes payable - related party into shares of common stock | 100 | |
Cancellation of notes payable into shares of common stock | $ 625 | |
Cancellation of note payable - related party into series B convertible preferred stock | 500 | |
In connection with the Company's acquisiton of Microphase Corporation, equity instruments were issued and liabilities assumed during 2017 as follows: | ||
Fair value of assets acquired | $ 7,893 | |
Equity instruments issued | (1,451) | |
Minority interest | (945) | |
Liabilities assumed | $ 5,497 |
DESCRIPTION OF BUSINESS
DESCRIPTION OF BUSINESS | 6 Months Ended |
Jun. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
DESCRIPTION OF BUSINESS | 1. DESCRIPTION OF BUSINESS Digital Power Corporation ( "Digital Power" "DP Limited" “DP Lending” purchased 56.4% of the outstanding equity interests of Microphase Corporation, a Delaware corporation (the “Microphase” “OEM” “RF” “DLVA” “Company” |
LIQUIDITY, GOING CONCERN AND MA
LIQUIDITY, GOING CONCERN AND MANAGEMENT'S PLANS | 6 Months Ended |
Jun. 30, 2017 | |
Liquidity Going Concern And Managements Plans | |
LIQUIDITY, FINANCIAL CONDITION AND MANAGEMENT'S PLANS | 2. LIQUIDITY, GOING CONCERN AND MANAGEMENT’S PLANS As of June 30, 2017, the Company had cash and cash equivalent of $443, an accumulated deficit of $15,218 and a negative working capital of $1,785. The Company has incurred recurring losses and reported losses for the three and six months ended June 30, 2017, totaled $1,739 and $2,733, respectively. In the past, the Company has financed its operations principally through issuances of convertible debt, promissory notes and equity securities. During 2017, as reflected below, the Company continues to successfully obtain additional equity and debt financing and in restructuring existing debt. The following financings transactions were consummated during 2017: • In February 2017, the Company issued demand promissory notes and warrants to purchase 333,333 shares of common stock at $ 0.70 per share for aggregate proceeds of $400. Further in February 2017, the holders of $400 in demand promissory notes agreed to extinguish their $400 of debt by cancelling their notes to purchase 666,667 shares of common stock of the Company at $0.60 per share (See Note 9). • On March 9, 2017, the Company entered into a Preferred Stock Purchase Agreement with Philou Ventures LLC ( “Philou” • On March 15, 2017, the Company entered into a subscription agreement with one investor for the sale of 500,000 shares of common stock at $0.60 per share for the aggregate purchase price of $300 (See Note 13). • On March 20, 2017, the Company issued $250 in demand promissory note to one of the Company's shareholders (See Note 13). This $250 demand promissory note was converted in shares of the Series B Preferred Stock for the benefit of Philou. • On March 28, 2017, the Company issued $270 in demand promissory notes to several investors. The Company received gross proceeds of $220 on March 31, 2017 and the remaining balance of $50 was received on April 3, 2017. On April 5, 2017, the Company canceled these promissory notes by issuing to the holders 360,000 shares of common stock at $0.75 per share and warrants to purchase 180,000 shares of common stock at $0.90 per share (See Note 9). • On April 17, 2017, the Company entered into two 7% convertible notes (the “7% Convertible Notes” • On April 26, 2017, the Company entered into a 7% convertible note in the aggregate principal amount of $104. On June 28, 2017, the noteholder converted the outstanding balance into 189,091 shares of Digital Power’s common stock (See Note 11). • Between May 5, 2017 and June 30, 2017, the Company received additional short-term loans of $140 from four accredited investors of which $75 was from the Company’s corporate counsel, a related party. As additional consideration, the investors received five-year warrants to purchase 224,371 shares of common stock at a weighted average exercise price of $0.77 per share.On June 28, 2017, the holders of $55 of these short-term loans cancelled their notes for the purchase of 100,001 shares of Digital Power’s common stock at a price of $0.55 per share. An additional $52 in short-term loans that was received from the related party was also converted on June 28, 2017, into one of the Series C Units (See Note 9). • Between May 24, 2017 and June 19, 2017, Digital Power entered into subscription agreements (the “Series C Subscription Agreement” “Series C Investors” • Between July 1, 2017 and August 17, 2017, the Company received net cash proceeds of $1,505 from issuances of the Company’s debt and equity securities. Further, $268 in convertible notes were exchanged for shares of the Company’s common stock (See Note 16). The Company expects to continue to incur losses for the foreseeable future and needs to raise additional capital to continue its business development initiatives and to support its working capital requirements. In March 2017, the Company was awarded a 3-year, $50 million purchase order by MTIX Ltd. ( “MTIX" “MLSE” |
BASIS OF PRESENTATION AND SIGNI
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | 3. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and Regulation S-X and do not include all the information and disclosures required by generally accepted accounting principles in the United States of America ( “GAAP” Principles of Consolidation The condensed consolidated financial statements include the accounts of Digital Power, its wholly-owned subsidiaries, DP Limited and DP Lending and its majority-owned subsidiary, Microphase. All significant intercompany accounts and transactions have been eliminated in consolidation. Accounting Estimates The preparation of financial statements, in conformity with GAAP, requires management to make estimates, judgments and assumptions. The Company's management believes that the estimates, judgments and assumptions used are reasonable based upon information available at the time they are made. These estimates, judgments and assumptions can affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements, and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates. Key estimates include fair value of certain financial instruments, reserve for trade receivables and inventories, carrying amounts of investments, accruals of certain liabilities, and deferred income taxes and related valuation allowance. Investments in Debt and Equity Securities The Company classifies its investments in Avalanche International, Corp ( “AVLP” Investment in Debt and Equity Securities “ASC No. 320” Investment – Other “ASC No. 325” Revenue Recognition The Company generates revenues from the sale of its products through a direct and indirect sales force. Revenues from products are recognized in accordance with ASC No. 605, Revenue Recognition Warranty The Company offers a warranty period for all of its products. Warranty periods range from one to two years depending on the product. The Company estimates the costs that may be incurred under its warranty and records a liability in the amount of such costs at the time product revenue is recognized. Factors that affect the Company's warranty liability include the number of units sold, historical rates of warranty claims and cost per claim. The Company periodically assesses the adequacy of its recorded warranty liability and adjusts the amounts as necessary. As of June 30, 2017 and December 31, 2016, the Company’s accrued warranty liability was $86. Common Stock Purchase Warrants and Other Derivative Financial Instruments The Company classifies common stock purchase warrants and other free standing derivative financial instruments as equity if the contracts (i) require physical settlement or net-share settlement or (ii) give the Company a choice of net-cash settlement or settlement in its own shares (physical settlement or net-share settlement). The Company classifies any contracts that (i) require net-cash settlement (including a requirement to net cash settle the contract if an event occurs and if that event is outside the control of the Company), (ii) give the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement), or (iii) contain reset provisions as either an asset or a liability. The Company assesses classification of its freestanding derivatives at each reporting date to determine whether a change in classification between assets and liabilities is required. The Company determined that certain freestanding derivatives, which principally consist of issuance of warrants to purchase shares of common in connection with convertible notes, units and to employees of the Company, satisfy the criteria for classification as equity instruments as these warrants do not contain cash settlement features or variable settlement provision that cause them to not be indexed to the Company’s own stock. Stock-Based Compensation The Company accounts for stock-based compensation in accordance with ASC No. 718, Compensation – Stock Compensation "ASC No. 718" The Company’s accounting policy for equity instruments issued to consultants and vendors in exchange for goods and services follows the provisions of ASC No. 505-50, Equity Based Payments to Non-Employees Convertible Instruments The Company accounts for hybrid contracts that feature conversion options in accordance with ASC No. 815, Derivatives and Hedging Activities “ASC No. 815” Conversion options that contain variable settlement features such as provisions to adjust the conversion price upon subsequent issuances of equity or equity linked securities at exercise prices more favorable than that featured in the hybrid contract generally result in their bifurcation from the host instrument. The Company accounts for convertible instruments, when the Company has determined that the embedded conversion options should not be bifurcated from their host instruments, in accordance with ASC No. 470-20, Debt with Conversion and Other Options “ASC No. 470-20” Comprehensive Loss The Company reports comprehensive loss in accordance with ASC No. 220, Comprehensive Income Fair value of Financial Instruments In accordance with ASC No. 820, Fair Value Measurements and Disclosures The guidance also establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the factors that market participants would use in valuing the asset or liability. The guidance establishes three levels of inputs that may be used to measure fair value: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or model-derived valuations. All significant inputs used in our valuations are observable or can be derived principally from or corroborated with observable market data for substantially the full term of the assets or liabilities Level 2 inputs also include quoted prices that were adjusted for security-specific restrictions which are compared to output from internally developed models such as a discounted cash flow models. Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The carrying amounts of financial instruments carried at cost, including cash and cash equivalents, trade receivables and trade receivable – related party, investments, notes receivable, trade payables and trade payables – related party approximate their fair value due to the short-term maturities of such instruments. As of June 30, 2017 and December 31, 2016, the fair value of the Company’s investments were $2,582 and $1,036, respectively, and were concentrated in debt and equity securities of AVLP, a related party (See Note 4), which are classified as available-for-sale investments. At June 30, 2017, the Company's investment in AVLP is comprised of convertible promissory notes of $2,491, net of unamortized discount, and marketable equity securities of $91. At December 31, 2016, the Company's investment in AVLP is comprised of convertible promissory notes of $952, net of unamortized discount, and marketable equity securities of $84. For investments in marketable equity securities, the Company took into consideration general market conditions, the duration and extent to which the fair value is below cost, and the Company’s ability and intent to hold the investment for a sufficient period of time to allow for recovery of value in the foreseeable future. As a result of this analysis, the Company has determined that its cost basis in AVLP equitable securities approximates the current fair value. Consistent with the guidance at ASC No. 835, the Company’s presumption is that the fair value of its convertible promissory notes in AVLP have a present value equivalent to the cash proceeds exchanged. Further, the discount shall be reported in the balance sheet as a direct deduction from the face amount of the convertible promissory notes. Thus, the Company has determined that the amortized cost of its convertible promissory notes approximates fair value and are subject to a periodic impairment review. The interest income, including amortization of the discount arising at acquisition, for the convertible promissory notes are included in earnings. In the future, if the Company does not expect to recover the entire amortized cost basis, the Company shall recognize other-than-temporary impairments in other comprehensive income (loss). In the first quarter of 2017, the Company purchased at the market shares of common stock of three companies for a total cost of $20. In accordance with ASC No. 320-10, these investments are accounted for pursuant to the fair value method. Based upon the closing market prices of common stock for these three companies at June 30, 2017, and most recently at August 15, 2017, the Company determined that its cost basis in the shares of common stock for these companies approximates the current fair value and has concluded that its investment in marketable securities is not impaired. The categorization of a financial instrument within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The following table sets forth the Company’s financial instruments that were measured at fair value on a recurring basis by level within the fair value hierarchy: Fair Value Measurement at June 30, 2017 Total Level 1 Level 2 Level 3 Investments – AVLP – a related party $ 2,582 $ 91 $ 2,491 $ — Investments in other companies $ 20 $ 20 $ — $ — Fair Value Measurement at December 31, 2016 Total Level 1 Level 2 Level 3 Investments – AVLP – a related party $ 1,036 $ 84 $ 952 $ — Debt Discounts The Company accounts for debt discount according to ASC No. 470-20, Debt with Conversion and Other Options Net Loss per Share Net loss per share is computed by dividing the net loss to common stockholders by the weighted average number of common shares outstanding. The calculation of the basic and diluted earnings per share is the same for all periods presented, as the effect of the potential common stock equivalents is anti-dilutive due to the Company’s net loss position for all periods presented. The Company has included 317,460 warrants, with an exercise price of $.01, in its earnings per share calculation for the three and six months ended June 30, 2017. Anti-dilutive securities consisted of the following at June 30, 2017 2016 Stock options 2,841,000 1,106,000 Warrants 7,426,080 — Convertible notes 1,296,969 — Conversion of preferred stock 4,606,131 — Total 16,170,180 1,106,000 Recently Issued Accounting Standards The Company has considered all other recently issued accounting standards and does not believe the adoption of such standards will have a material impact on its condensed consolidated financial statements. |
INVESTMENTS - RELATED PARTIES
INVESTMENTS - RELATED PARTIES | 6 Months Ended |
Jun. 30, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |
INVESTMENTS RELATED PARTIES | 4. INVESTMENTS – RELATED PARTIES Investments in AVLP at June 30, 2017, and December 31, 2016, are comprised of the following: June 30, December 31, 2017 2016 Investment in convertible promissory note of AVLP $ 2,593 $ 997 Investment in common stock of AVLP 91 84 Total investment in AVLP P – Gross 2,684 1,081 Less: original issue discount (102 ) (45 ) Total investment in AVLP P – Net $ 2,582 $ 1,036 During the year ended December 31, 2016, the Company made a strategic decision to invest in AVLP, a related party controlled by Philou, an existing majority stockholder. The Company’s investments in AVLP primarily consist of convertible promissory notes and shares of common stock of AVLP. On October 5, 2016, November 30, 2016, and February 22, 2017, the Company entered into three 12% Convertible Promissory Notes with AVLP (the "AVLP Notes" Subject to adjustment, AVLP . The Company has funded $970 in excess of the $1,500 net loan amount required pursuant to the terms of the AVLP Notes. The Company and AVLP have agreed that these additional advances shall feature terms mirroring those of the AVLP Notes, including 12% annual interest and an original issue discount of 5%; however, in addition to these terms, the Company and AVLP are in the process of finalizing additional terms that will be incorporated into a new convertible promissory note agreement. The original issue discount of $123 on the AVLP Notes, inclusive of the original issue discount attributed to the $970 loaned in excess of the AVLP Notes, is being amortized as interest income through the maturity date using the interest rate method. During the three and six months ended June 30, 2017, the Company recorded $12 and $19, respectively, of interest income for the discount accretion. As of June 30, 2017 and December 31, 2016, the Company recorded contractual interest receivable attributed to the AVLP Notes of $93 and $13, respectively. The Company has classified the AVLP Notes as Available-for-Sale securities, subject to the guidance in ASC No. 320. The Company elected to apply the Fair Value Option Subsections of Subtopic 320-10 and 825-10 to the AVLP Notes. At June 30, 2017, the closing market price of AVLP’s common Stock was $0.17. Subsequent to quarter-end, the closing market price of AVLP’s common stock was in the range of $0.17 and $ 0.38 and due to the illiquidity and significant volatility of AVLP’s common stock, the Company has determined that its cost basis in AVLP common stock approximates the current fair value. The Company has concluded that indicators of impairment, including those described in ASC No. 320-10-35-27, do not currently exist for the Company’s investment in debt and equity securities of AVLP. |
ACQUISITION
ACQUISITION | 6 Months Ended |
Jun. 30, 2017 | |
Business Combinations [Abstract] | |
ACQUISITION | 5. ACQUISITION Microphase Corporation On April 28, 2017, the Company entered into a Share Exchange Agreement (the “Share Exchange Agreement” “MHC” EFLP “RCKJ” “Significant Stockholders” “Minority Stockholders” “Stockholders” “Subject Shares” “MPC Common Stock” “Exchange” “Common Stock” “Exchange Shares” “Exchange Warrants” “Warrant Shares” “Exchange Securities.” 56.4% of the outstanding equity interests of Microphase Corporation The operating results of Microphase from the closing date of the acquisition, June 2, 2017, through June 30, 2017, are included in the consolidated financial statements. At closing, the purchase price of Digital Power’s 56.4% interest in Microphase was determined to be $1,451, comprised of the Exchange Shares, valued at $1,222, and the Exchange warrants, valued at $229. The value assigned to the Exchange Shares was based on the closing price of the Common Stock on June 2, 2017. The Company computed the fair value of these warrants using the Black-Scholes option pricing model. The acquisition of Microphase is being accounted for under the purchase method of accounting in accordance with ASC No. 805, Business Combinations Upon initial measurement, components of the purchase price are as follows: Cash and cash equivalents $ 11 Accounts receivable, net 439 Inventories, net 667 Prepaid expenses and other current assets 139 Restricted cash 100 Intangible assets 95 Property and equipment, net 93 Other investments 303 Deposits and loans 44 Accounts payable and accrued expenses (1,680 ) Revolving credit facility (880 ) Notes payable (2,204 ) Notes payable, related parties (406 ) Convertible notes payable 0 Other current liabilities (327 ) Net liabilities assumed (3,606 ) Goodwill 6,002 Minority interest (945 ) Purchase price $ 1,451 The following pro forma data summarizes the results of operations for the periods indicated as if the Microphase acquisition had been completed as of the beginning of each period presented. The pro forma data gives effect to actual operating results prior to the acquisition. These pro forma amounts do not purport to be indicative of the results that would have actually been obtained if the acquisition occurred as of the beginning of each period presented or that may be obtained in future periods: For the Three Months Ended June 30, For the Six Months Ended June 30, 2017 2016 2017 2016 Revenue $ 2,714 $ 4,017 $ 5,408 $ 7,848 Net loss $ (1,924 ) $ (651 ) $ (4,076 ) $ (1,099 ) Less: Net loss attributable to non-controlling interest 127 313 632 424 Net loss attributable to Digital Power Corp $ (1,797 ) $ (338 ) $ (3,444 ) $ (675 ) Preferred deemed dividends (319 ) — (319 ) — Preferred dividends (8 ) — (8 ) — Loss available to common shareholders $ (2,124 ) $ (338 ) $ (3,771 ) $ (675 ) Basic and diluted net loss per common share $ (0.17 ) $ (0.04 ) $ (0.33 ) $ (0.08 ) Basic and diluted weighted average common shares outstanding 12,310,106 8,618,419 11,273,393 8,618,419 Comprehensive Loss Loss available to common shareholders $ (2,124 ) $ (338 ) $ (3,771 ) $ (675 ) Other comprehensive income (loss) Change in net foreign currency translation adjustments 78 (152 ) 99 (210 ) Net unrealized gain (loss) on securities available-for-sale, net of income taxes 0 — 130 18 Other comprehensive income (loss) 78 (152 ) 229 (192 ) Total Comprehensive loss $ (2,046 ) $ (490 ) $ (3,542 ) $ (867 ) |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 6 Months Ended |
Jun. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
STOCK-BASED COMPENSATION | 6. STOCK-BASED COMPENSATION Under the Company's 2016 Stock Incentive Plan (the “2016 Plan” “2012 Plan” “Plans” “2002 Plan” Options granted under the Plans have an exercise price equal to or greater than the fair value of the underlying common stock at the date of grant and become exercisable based on a vesting schedule determined at the date of grant. Typically, options granted generally become fully vested after four years. Any options that are forfeited or cancelled before expiration become available for future grants. The options expire between 5 and 10 years from the date of grant. Restricted stock awards granted under the Plans are subject to a vesting period determined at the date of grant. As of June 30, 2017, an aggregate of 1,781,477 of the Company's options are still available for future grant. During the three and six months ended June 30, 2017, the Company granted nil and 510,000 options, respectively, from the Plans to its employees at an average exercise price of $0.60 per share. These options become fully vested after four years. The Company estimated that the grant date fair value of these options was $229, which is being recognized as stock-based compensation expense over the requisite four-year service period. During the three months ended June 30, 2017, the Company also issued 956,153 shares of common stock to its consultants and service providers pursuant to the 2016 Plan. The Company estimated that the grant date fair value of these shares of common stock was $499, which was determined from the closing price of the Company’s common stock on the date of issuance. The Company did not grant any options or restricted stock awards during the six months ended June 30, 2016. The Company has valued the options at their date of grant utilizing the Black-Scholes option pricing model. This model is dependent upon several variables such as the options’ term, exercise price, current stock price, risk-free interest rate estimated over the expected term and estimated volatility of our stock over the expected term of the options. The risk-free interest rate used in the calculations is based on the implied yield available on U.S. Treasury issues with an equivalent term approximating the expected life of the options as calculated using the simplified method. The estimated volatility was determined based on the historical volatility of our common stock. During the six months ended June 30, 2017, the Company estimated the fair value of stock options granted using the Black-Scholes option pricing model with the following weighted average assumptions: June 30, 2017 Weighted average risk free interest rate 1.89% — 2.14 % Weighted average life (in years) 5.0 Volatility 98.41% — 98.55 % Expected dividend yield 0 % Weighted average grant-date fair value per share of options granted $ 0.45 The options outstanding as of June 30, 2017, have been classified by exercise price, as follows: Outstanding Exercisable Weighted Average Weighted Weighted Remaining Average Average Exercise Number Contractual Exercise Number Exercise Price Outstanding Life (Years) Price Exercisable Price $0.60 - $0.79 2,375,000 9.38 $ 0.66 1,246,667 $ 0.66 $1.10 - $1.32 25,000 6.35 $ 1.28 15,000 $ 1.25 $1.51 - $1.69 441,000 5.36 $ 1.61 378,500 $ 1.60 $0.60 - 1.69 2,841,000 8.73 $ 1.10 1,640,167 $ 0.88 The total stock-based compensation expense related to stock options and restricted stock awards to the Company’s employees, consultants and directors, included in reported net loss Three Months Ended Six Months Ended June 30, 2017 June 30, 2016 June 30, 2017 June 30, 2016 Cost of revenues $ 3 $ 2 $ 4 $ 4 Engineering and product development 6 1 13 2 Selling and marketing 6 4 11 8 General and administrative 557 36 668 73 Total stock-based compensation $ 572 $ 43 $ 696 $ 87 The combination of stock-based compensation of $696 from the issuances of equity based awards pursuant to the Plans and stock-based compensation attributed to restricted stock awards of $10 and warrants of $46, which were issued outside of the Plans, resulted in aggregate stock-based compensation of $752 during the six months ended June 30, 2017. During the three months ended June 30, 2017, aggregate stock-based compensation was $595, which consisted of $572 from the issuances of equity based awards pursuant to the Plans and stock-based compensation attributed to warrants of $23, which were issued outside of the Plans. During the three and six months ended June 30, 2016, the only stock-based compensation expense was from issuances pursuant to the Plans. A summary of option activity under the Company's stock option plans as of June 30, 2017, and changes during the six months ended are as follows: Outstanding Options Weighted Weighted Average Shares Average Remaining Aggregate Available Number Exercise Contractual Intrinsic for Grant of Shares Price Life (years) Value December 31, 2016 3,247,630 2,331,000 $ 0.83 9.08 $ 0 Restricted stock awards (956,153 ) Grants (510,000 ) 510,000 $ 0.60 June 30, 2017 1,781,477 2,841,000 $ 0.81 8.73 $ 148 The aggregate intrinsic value in the table above represents the total intrinsic value (the difference between the Company's closing stock price on June 30, 2017, $0.72 and the exercise price, multiplied by the number of in-the-money-options). As of June 30, 2017, there was $524 of unrecognized compensation cost related to non-vested stock-based compensation arrangements granted under the Company's stock option plans. That cost is expected to be recognized over a weighted average period of 2.2 years. |
WARRANTS
WARRANTS | 6 Months Ended |
Jun. 30, 2017 | |
Warrants | |
WARRANTS | 7. WARRANTS During the six months and ended June 30, 2017, the Company issued a total of 5,567,954 warrants, at an average exercise price of $0.89 per share. These issuances included: (i) Between May 24, 2017 and June 19, 2017, the Company issued sale of twenty-one Units at a purchase price of $52 per Unit raising in the aggregate $1,092. Each Unit consisted of 21,667 shares of Series C Preferred Stock and Warrants to purchase 86,667 shares of common stock, (ii) The Company engaged Divine Capital Markets, LLC ( “Divine” ) to act as Placement Agent (the “Placement Agent” ) for the private placement of the Units. For its services, the Placement Agent received, in addition to a 10.0% commission on the sale of each Unit and a 3.0% non-refundable expense allowance, warrants to purchase 10% of the Units sold at 120% of the Unit purchase price. The warrant to purchase 2.1 Units equates to a warrant to purchase 182,003 shares of the Company’s common stock at $0.72 per share and a second warrant to purchase 182,003 shares of the Company’s common stock at $1.00 per share. (iii) Between March 24, 2017 and June 2, 2017, the Company issued warrants to purchase 1,428,572 shares of common stock, at an exercise price of $0.70 per share of common stock, in connection with the Preferred Stock Purchase Agreements to purchase 100,000 shares of Series B Preferred Stock by Philou (iv) On June 2, 2017, the Company issued warrants to purchase 1,000,000 shares of common stock, at an exercise price of $1.10 per share of common stock, pursuant to the terms of the Share Exchange Agreement (See Note 5). (v) On April 5, 2017, the Company issued warrants to purchase 180,002 shares of common stock, at an exercise price of $0.90 per share of common stock, in connection with the cancellation of $270 in demand promissory notes (See Note 9). (vi) On April 17, 2017, the Company issued warrants to purchase 166,668 shares of common stock in connection with the issuance of two 7% convertible notes in the aggregate principal amount of $250 (See Note 11). (vii) Between May 5, 2017 and June 30, 2017, the Company issued warrants to purchase 224,371 shares of common stock in connection with the ) of which $75 was from the Company’s corporate counsel, a related party. (viii) On April 26, 2017, the Company issued warrants to purchase 160,000 shares of common stock in connection with the issuance of a 7% convertible note in the aggregate principal amount of $104 (See Note 11). (ix) Warrants to purchase 333,333 shares of common stock issued in connection with the $400 of 6% demand promissory notes The following table summarizes information about common stock warrants outstanding at June 30, 2017: Outstanding Exercisable Weighted Average Weighted Weighted Remaining Average Average Exercise Number Contractual Exercise Number Exercise Price Outstanding Life (Years) Price Exercisable Price $0.01 317,460 9.35 $ 0.01 79,364 $ 0.01 $0.70 1,761,905 5.20 $ 0.70 — — $0.72 182,003 4.97 $ 0.72 — — $0.75 135,909 4.88 $ 0.75 — — $0.80 1,415,128 2.80 $ 0.80 1,166,666 $ 0.80 $0.90 611,670 3.85 $ 0.90 265,000 $ 0.90 $1.00 2,002,005 4.93 $ 1.00 — — $1.10 1,000,000 2.92 $ 1.10 — — $0.01 - 1.10 7,426,080 4.42 $ 0.84 1,511,030 $ 0.78 The Company The Company utilized the Black-Scholes option pricing model and the assumptions used during the six months ended June 30, 2017: June 30, 2017 Weighted average risk free interest rate 1.42% — 2.01 % Weighted average life (in years) 4.8 Volatility 98.5% — 107.1 % Expected dividend yield 0 % Weighted average grant-date fair value per share of warrants granted $ 0.38 |
REVOLVING CREDIT FACILITY
REVOLVING CREDIT FACILITY | 6 Months Ended |
Jun. 30, 2017 | |
Debt Disclosure [Abstract] | |
REVOLVING CREDIT FACILITY | 8. REVOLVING CREDIT FACILITY Microphase entered into a revolving loan agreement with Gerber Finance, Inc. ( “Gerber” “Revolving Credit Facility” “Maximum Revolving Amount” Interest accrues at the unpaid principal On June 20, 2017, Microphase received a notice from Gerber that several events of default had occurred under the Revolving Credit Facility and on July 14, 2017, Microphase and Gerber entered into a Forbearance Agreement. The events of default were primarily related to, (i) the change in control that occurred on June 2, 2017, when Digital Power acquired a majority interest in Microphase, and (ii) borrowings under the Revolving Credit Facility exceeding the collateral borrowing base. |
NOTES PAYABLE
NOTES PAYABLE | 6 Months Ended |
Jun. 30, 2017 | |
Notes Payable [Abstract] | |
NOTES PAYABLE | 9. NOTES PAYABLE Notes Payable at June 30, 2017, and December 31, 2016, are comprised of the following: June 30, December 31, 2017 2016 10% short-term promissory notes (a) $ 705 $ — Notes payable to Lucosky Brookman, LLP (b) 450 — Notes payable to Wells Fargo (c) 308 — Note payable to Department of Economic and Community Development (d) 300 — Note payable to People's United Bank ( e) 20 — Other short-term notes payable (f) 33 — Total notes payable 1,816 — Less: current portion (1,218 ) — Notes payable – long-term portion $ 569 $ — (a) In December 2016, Microphase issued $705 in 10% short-term promissory notes to nineteen accredited investors which, after deducting $71 of placement fees to its selling agent, Spartan Capital Securities, LLC ( “Spartan” “10% Short-Term Notes” “Loan Premium” (b) On June 2, 2017, pursuant to the terms of the Share Exchange Agreement and in consideration of legal services, Microphase issued a $450 8% promissory note with a maturity date of November 25, 2017 to Lucosky Brookman, LLP (the “Lucosky Note” “Series E Preferred Stock” The Company, at its option, may redeem for cash, in whole or in part, at any time and from time to time, the shares of Series E Preferred Stock at the time outstanding, upon written notice to the holder of the shares, at a cash redemption price equal to $45 multiplied by the number of shares being redeemed. Any such optional redemption by the Company shall be credited against the Lucosky Note. the Lucosky Note. Lucosky Note (c) At June 30, 2017, Microphase had guaranteed the repayment of two equity lines of credit in the aggregate amount of $308 with Wells Fargo Bank, NA ( “Wells Fargo” “Wells Fargo Notes” (d) In August 2016, Microphase received a $300 loan pursuant to the State of Connecticut Small Business Express Job Creation Incentive Program which is administered through the Department of Economic and Community Development ( “DECD” “DECD Note” (e) In December 2016, Microphase utilized a $20 overdraft credit line at People’s United Bank with an annual interest rate of 15%. As of June 30, 2017, the balance of that overdraft credit line was $20. (f) Between May 5, 2017 and June 30, 2017, Digital Power received additional short-term loans of $140 from four accredited investors, of which $75 was from the Company’s corporate counsel, a related party. As additional consideration, the investors received five-year warrants to purchase 224,371 shares of common stock at a weighted average exercise price of $0.77 per share. The warrants are exercisable commencing six months after the issuance date and are subject to certain beneficial ownership limitations. The exercise price of these warrants is subject to adjustment for customary stock splits, stock dividends, combinations and other standard anti-dilution events. The warrants may be exercised for cash or on a cashless basis. During the quarter ended June 30, 2017, the Company recorded debt discount in the amount of $95 based on the estimated fair value of these warrants. The Company computed the fair value of these warrants using the Black-Scholes option pricing model. As a result of the short-term feature of these loans and advances, the debt discount was amortized as non-cash interest expense upon issuance of the warrants using the effective interest method. During June 2017, the holders of $55 of these short-term loans agreed to cancel their notes for the purchase of 100,001 shares of Digital Power’s common stock and a price of $0.55 per share. An additional $52 in short-term loans from the Company’s corporate counsel was converted into one of the Series C Units. The Company did not record any additional interest expense as a result of the extinguishment of $107 in short-term loans since the carrying amount of the short-term loans was equivalent to the fair value of the consideration transferred, which was determined from the closing price of the Company’s equity securities on the date of . Other Notes Payable In February 2017, the Company issued to eight accredited investors “Feb. 2017 Warrants” Between February 16, 2017 and February 23, 2017, the holders of the $400 in demand promissory notes agreed to cancel their demand promissory notes for the purchase of 666,667 shares of the Company’s common stock, an extinguishment price of $0.60 per share. During the quarter ended March 31, 2017, the Company recorded additional interest expense of $13 as a result of the extinguishment of the $400 in demand promissory notes based on the difference of the carrying amount of the demand promissory notes and the fair value of the consideration transferred, which was determined from the closing price of the Company’s common stock on the date of . On March 28, 2017, the Company issued $270 in demand promissory notes to several investors. These demand promissory notes accrued interest at the rate of 6% per annum. The Company received gross proceeds of $220 on March 31, 2017. The remaining balance of $50 was received on April 3, 2017. On April 5, 2017, the Company canceled these promissory notes by issuing to the investors 360,000 shares of common stock, at $0.75 per share, and warrants to purchase 180,002 shares of common stock at $0.90 per share. During the quarter ended June 30, 2017, the Company recorded additional interest expense of $109 as a result of the extinguishment of the $270 in demand promissory notes based on the difference of the carrying amount of the demand promissory notes and the fair value of the consideration transferred, which was determined from the closing price of the Company’s common stock on the date of . |
NOTES PAYABLE RELATED PARTIES
NOTES PAYABLE RELATED PARTIES | 6 Months Ended |
Jun. 30, 2017 | |
Debt Disclosure [Abstract] | |
NOTES PAYABLE RELATED PARTIES | 10. NOTES PAYABLE – RELATED PARTIES Notes Payable – Related parties at June 30, 2017, and December 31, 2016, are comprised of the following: June 30, December 31, 2017 2016 Notes payable to MCKEA Holdings, LLC (a) $ — $ 250 Notes payable to former officer and employee (b) 406 — Total notes payable 406 250 Less: current portion (278 ) (250) Notes payable – long-term portion $ 128 $ — (a) On December 29, 2016, the Company entered into an agreement with (“MCKEA” , a director and the wife of Milton C. Ault III, Executive , is the manager and owner of MCKEA, for a demand promissory note (The “MCKEA Note” ) in the amount of $250 bearing interest at the rate of 6% per annum on unpaid principal. The MCKEA Note may be prepaid, in whole or in part, without penalty, at the option of the Company and without the consent of MCKEA. As of December 31, 2016, no interest was accrued on the MCKEA Note. , the MCKEA Note was cancelled to purchase the Company’s (b) Microphase is a party to several notes payable agreements with seven of its past officers, employees and their family members. As of June 30, 2017, the aggregate outstanding balance pursuant to these notes payable agreements was $488, with annual interest rates ranging between 3.00% and 6.00%. During the period June 3, 2017 to June 30, 2017, Microphase incurred $2 of interest on these notes payable agreements. In July 2016, one of these noteholders initiated litigation to collect the balance owed under the terms of his respective agreement. At June 30, 2017, the outstanding principal balance owed under this particular agreement was $152. |
CONVERTIBLE NOTES
CONVERTIBLE NOTES | 6 Months Ended |
Jun. 30, 2017 | |
Long-term Debt, Unclassified [Abstract] | |
CONVERTIBLE NOTES | 11. CONVERTIBLE NOTES Convertible notes at June 30, 2017, and December 31, 2016, are comprised of the following: June 30, December 31, 2017 2016 7% Convertible note $ 250 $ — Convertible note $ 250 $ — On April 17, 2017, the Company entered into two 7% convertible notes (the “7% Convertible Notes” As additional consideration, the investors received five and a half year warrants to purchase 166,668 shares of common stock at an exercise price of $0.90 per share (collectively the “7% Convertible Note Warrants” The Company computed the fair value of the 7% Convertible Note The beneficial conversion feature ( “BCF” Convertible Notes 470, De Convertible Note Convertible Notes Other Convertible Notes Payable On April 26, 2017, the Company entered into a 7% convertible note in the aggregate principal amount of $104. On June 28, 2017, the noteholder converted the outstanding balance into 189,091 shares of Digital Power’s common stock . The Company did not record any additional interest expense as a result of the extinguishment since the carrying amount of the convertible notes was equivalent to the fair value of the consideration transferred, which was determined from the closing price of the Company’s equity securities on the date of . As additional consideration, the investor received a five-year warrant to purchase 160,000 shares of common stock at an exercise price of $0.80 per share. The warrants are exercisable commencing six months after the issuance date. The exercise price of the warrants is subject to adjustment for customary stock splits, stock dividends, combinations and other standard anti-dilution events. The warrants may be exercised for cash or on a cashless basis. The Company computed the fair value of these warrants using the Black-Scholes option pricing model and, as a result of this calculation, recorded debt discount in the amount of $25 based on the estimated fair value of the warrants. The beneficial conversion feature ( “BCF” convertible note 470, De convertible note onvertible note |
CONVERTIBLE NOTE RELATED PARTY
CONVERTIBLE NOTE RELATED PARTY | 6 Months Ended |
Jun. 30, 2017 | |
Long-term Debt, Unclassified [Abstract] | |
CONVERTIBLE NOTE RELATED PARTY | 12. CONVERTIBLE NOTE – RELATED PARTY Convertible notes – related party at June 30, 2017, and December 31, 2016, are comprised of the following: June 30, December 31, 2017 2016 12% Convertible secured note $ 530 $ 530 Less: Unamortized debt discounts (398 ) (484 ) Unamortized financing cost (10 ) (12 ) Convertible note – related party $ 122 $ 34 On October 21, 2016, the Company entered into a 12% convertible secured note (the “Convertible Note” “OID” The Convertible Note contains standard and customary events of default including, but not limited to, failure to make payments when due under the Convertible Note agreement and bankruptcy or insolvency of the Company. Upon 30 days’ notice, the Company has the right to prepay the Convertible Note. In addition, provided that the closing price for a share of the Company’s common stock exceeds $3.00 per share for 30 consecutive trading days, the Company has the right to compel the noteholder to convert the principal amount into shares of common stock at the contractual conversion price. As additional consideration, the investor received a three-year warrant to purchase 265,000 shares of common stock, at an exercise price of $0.80 per share, and a three-year warrant to purchase 265,000 shares of common stock, at an exercise price of $0.90 per share (collectively the “Convertible Note Warrants” The Company computed the fair value of the Convertible Note The beneficial conversion feature ( “BCF” Convertible Note 470, De Convertible Note Convertible Note In aggregate, the Company recorded debt discount in the amount of $518 based on the relative fair values of the Convertible Note Warrants of $159, BCF of $329 and OID of $30. The debt discount is being amortized as non-cash interest expense over the term of the debt. In addition, the Company incurred $13 of debt issuance costs which are also being amortized as non-cash interest expense over the term of the debt. During both the three and six months ended June 30, 2017, non-cash interest expense of $44 was recorded from the amortization of debt discounts and debt financing cost. As of June 30, 2017 and December 31, 2016, accrued interest on the Convertible Note was $16 and $12, respectively. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 6 Months Ended |
Jun. 30, 2017 | |
STOCKHOLDERS' EQUITY | |
STOCKHOLDERS' EQUITY | 13. STOCKHOLDERS’ EQUITY Preferred Stock The Company is authorized to issue 2,000,000 shares of Preferred Stock with no par value. The Board of Directors has designated 500,000 shares of its Preferred Stock as Series A cumulative Redeemable Convertible Preferred shares (the “Series A Preferred Stock” Convertible Preferred Stock (the “Series B Preferred Stock” Convertible Preferred Stock (the “Series C Preferred Stock” Convertible Preferred Stock (the “Series D Preferred Stock” Convertible Preferred Stock (the “Series E Preferred Stock” As of June 30, 2017, there were 100,000 shares of Series B Preferred Stock, 455,002 shares of Series C Preferred Stock, 378,776 shares of Series D Preferred Stock, 10,000 shares of Series E Preferred Stock issued and outstanding and no other shares of Preferred Stock were issued or outstanding. As of December 31, 2016, there were no shares of Preferred Stock issued or outstanding. Series B Preferred Stock On March 9, 2017, the Company entered into a Preferred Stock Purchase Agreement with Philou, a related party. Pursuant to the terms of the Preferred Stock Purchase Agreement, Philou may invest up to $5,000 in the Company through the purchase of Series B Preferred Stock over the term of 36 months. Each share of Series B Preferred Stock has a stated value of $10.00 per share. Each share of Series B Preferred Stock may be convertible at the holder’s option into shares of common stock of the Company at a conversion rate of $0.70 per share, upon the earlier to occur of: (i) 60 months from the closing date, or (ii) upon the filing by the Company of one or more periodic reports that, singly or collectively, evidence(s) that the Company’s gross revenues have reached no less than $10,000 in the aggregate, on a consolidated reporting basis, over four consecutive quarters in accordance with U.S. GAAP. The conversion price will be subject to standard anti-dilution provisions in connection with any stock split, stock dividend, subdivision or similar reclassification of the common stock. Each share of Series B Preferred Stock shall have the right to receive dividends equal to one ten millionth (0.0000001) of earnings before interest, taxes, depreciation, amortization and stock-based compensation ( “EBITDAS” At such time as (i) all shares of common stock issuable upon conversion of all outstanding shares of Series B Preferred Stock (the “Conversion Shares” In addition, for each share of Series B Preferred Stock purchased, Philou will receive warrants to purchase shares of common stock in a number equal to the stated value of each share of Series B Preferred Stock purchased divided by $0.70, at an exercise price equal to $0.70 per share of common stock. The warrants do not require a net cash-settlement or provide the holder with a choice of net-cash settlement. The warrants also do not contain a variable settlement provision. Accordingly, any warrants issued to Philou pursuant to the terms of the Preferred Stock Purchase Agreement shall be classified as equity instruments. Further, Philou shall have the right to participate in the Company’s future financings under substantially the same terms and conditions as other investors in those respective financings in order to maintain its then percentage ownership interest in the Company. Philou’s right to participate in such financings shall accrue and accumulate provided that it still owns at least 100,000 shares of Series B Preferred Stock. Between March 24, 2017 and June 2, 2017, Philou purchased 1,000,000 shares of Series B Preferred Stock pursuant to the Preferred Stock Purchase Agreement in consideration of the cancellation of the Company debt due to an affiliate of Philou in the amount of $250 and cash of $750. In addition, Philou received warrants to purchase 1,428,572 shares of common stock at an exercise price of $0.70 per share of common stock, which have been classified as equity instruments. The Company determined that the estimated relative fair value of these warrants, which are classified as equity, was $401 using the Black-Scholes option pricing model. Since the warrants were classified as equity securities, the Company allocated the $1,000 purchase price based on the relative fair values of the Series B Preferred Stock and the warrants following the guidance in ASC No. 470, Debt The Series B Convertible Preferred Stock is convertible at any time, in whole or in part, at the option of Philou, into shares of common stock at a fixed conversion price, which is subject to adjustment for stock splits, stock dividends, combinations or similar events, of $0.70 per share. As the effective conversion price of the Series B Convertible Preferred Stock on a converted basis was below the market price of the Company’s common stock on the date of issuance, it was determined that these discounts represent contingent beneficial conversion features, which were valued at $265 based on the difference between the effective conversion price and the market price of the Company’s common stock on the date of issuance. The Company, however, is prohibited from issuing shares of common stock pursuant to the Series B Convertible Preferred Stock unless stockholder approval of such issuance of securities is obtained as required by applicable NYSE MKT listing rules. The Company has not yet received stockholder approval of such share issuances. This provision resulted in a contingent beneficial conversion feature that shall be recognized once the contingency is resolved. These features are analogous to preference dividends and shall be recorded as a non-cash return to preferred shareholders through accumulated deficit upon resolution of the contingency. Series C Preferred Stock Between May 24, 2017 and June 19, 2017, Digital Power entered into subscription agreements (the “Series C Subscription Agreement” “Series C Investors” Each share of Series C Preferred Stock has a stated value of $2.40 per share. Each share of Series C Preferred Stock may be convertible at the holder’s option into shares of Common Stock of the Company at a conversion price of $0.60 per share, which, currently, represents four shares of Common Stock. The conversion price is subject to standard anti-dilution provisions in connection with any stock split, stock dividend, subdivision or similar reclassification of the Common Stock. Each share of Series C Preferred stock is mandatorily converted into shares of Common Stock based on the then conversion price in effect in the event that the Company’s Common Stock closing price exceeds $1.20 per share for 20 consecutive trading days. As the effective conversion price of the Series C Convertible Preferred Stock on a converted basis was below the market price of the Company’s common stock on the date of issuance, it was determined that these discounts represent beneficial conversion features, which were valued at $371 and recognized as a deemed dividend, based on the difference between the effective conversion price and the market price of the Company’s common stock on the date of issuance. Each share of Series C Preferred Stock has the right to receive dividends equal $0.24 per share per annum as declared by the Company’s Board of Directors. The dividends will be paid on a quarterly basis on the 20th day following each calendar quarter. Each share of Series C Preferred Stock shall have dividend and liquidation rights in priority to any shares of Common Stock, the Company’s Series A Preferred Stock (of which none are outstanding) and any other subordinated securities; but shall be subordinated to any senior securities including the Company’s Series B Preferred Stock. Each share of Series C Preferred Stock is subject to redemption by the Company for the stated value plus accrued but unpaid dividends five years after issuance, provided the holders of Series C Preferred Stock had not elected previously to convert the Series C Preferred Stock into shares of Common Stock. Series D Preferred Stock On June 2, 2017, pursuant to the terms of the Share Exchange Agreement, the Company acquired 1,603,434 shares of the issued and outstanding common stock of Microphase Common Stock in exchange for the issuance by the Company of 1,842,448 shares of Digital Power’s Common Stock and 378,776 shares of Digital Power’s Series D Preferred Stock, no par value per share, In the event the Company shall liquidate, dissolve or wind up, the holders of Series D Preferred Stock shall be entitled to receive, prior and in preference to any distribution of any of the assets of the Company to the holders of the Common Stock, the Company’s Series A Preferred Stock, or to the holders of any other junior series of preferred stock, by reason of their ownership thereof and subject to the rights of the Company’s Series B Preferred Stock, Series C Preferred Stock and any other class or series of Company stock subsequently issued that ranks senior to the Series D Preferred Stock, an amount per share in cash or equivalent value in securities or other consideration equal to its Stated Value of $0.01 per share. The holders of Series D Preferred Stock shall not be entitled to receive dividends and shall have no voting rights except as otherwise required by law. Upon the shareholders of DPW Common Stock approving the conversion of the Series D Preferred Stock into shares of DPW Common Stock in connection with the acquisition of MPC Common Stock and for purposes of compliance with Rule 713 of the NYSE MKT, then each share of Series D Preferred Stock shall automatically be converted into two shares of DPW Common Stock, for an aggregate of 757,552 shares of DPW Common Stock. Series E Preferred Stock On June 2, 2017, pursuant to the terms of the Share Exchange Agreement and in consideration of legal services, Microphase issued a $450 8% promissory note with a maturity date of November 25, 2017 to an unsecured creditor, Lucosky Brookman, LLP (the “Lucosky Note” no par value per share, equal to forty-five dollars ($45.00) per share The Company, at its option, may redeem for cash, in whole or in part, at any time and from time to time, the shares of Series E Preferred Stock at the time outstanding, upon written notice to the holder of the shares, at a cash redemption price equal to $45 multiplied by the number of shares being redeemed. Any such optional redemption by the Company shall be credited against the Lucosky Note. In the event the Company shall liquidate, dissolve or wind up, the holders of Series E Preferred Stock shall be entitled to receive, prior and in preference to any distribution of any of the assets of the Company to the holders of the DPW Common Stock, the Company’s Series A Preferred Stock, or to the holders of any other junior series of preferred stock, by reason of their ownership thereof and subject to the rights of the Company’s Series B Preferred Stock, Series C Preferred Stock and any other class or series of Company stock subsequently issued that ranks senior to the Series E Preferred Stock an amount per share in cash or equivalent value in securities or other consideration equal to $0.01 per share. The holders of Series E Preferred Stock shall not be entitled to receive dividends and shall have no voting rights except as otherwise required by law. Subject to the shareholders of DPW Common Stock of the Company approving the conversion of the Series E Preferred Stock into shares of Common Stock in connection with the acquisition of MPC Common Stock and for purposes of compliance with Rule 713 of the NYSE MKT, then each share of Series E Preferred Stock may be converted into sixty (60) shares of DPW Common Stock, for an aggregate of 600,000 shares of DPW Common Stock. Common Stock Common stock confers upon the holders the rights to receive notice to participate and vote in the general meeting of shareholders of the Company, to receive dividends, if and when declared, and to participate in a distribution of surplus of assets upon liquidation of the Company. On November 15, 2016, the Company entered into subscription agreements (the “2016 Subscription Agreements” The 2016 Subscription Agreement provides that, until November 15, 2017, investors who purchased at least $100,000 have the right to participate in the purchase of up to 50% of the securities offered by the Company in any future financing transactions, with limited exceptions. The Nov. 2016 Warrants entitle the holders to purchase, in the aggregate, up to 901,666 shares of Common Stock at an exercise price of $0.80 per share for a period of three years. The Nov. 2016 Warrants are exercisable upon the six-month anniversary of the issuance date. The exercise price of the Nov. 2016 Warrants is subject to adjustment for stock splits, stock dividends, combinations and other standard anti-dilution events. The Nov. 2016 Warrants may be exercised for cash or, upon the failure to maintain an effective registration statement, on a cashless basis. Between February 16, 2017 and February 23, 2017, the Company issued 666,667 shares of its common stock, an extinguishment price of $0.60 per share, for the cancellation of $400 in demand promissory notes. On March 8, 2017, the Company issued an aggregate of 12,549 shares of its common stock as payment for services to a consultant. The shares were valued at $10, an average of $0.80 per share On March 15, 2017, Company entered into a subscription agreement with a related party for the sale of 500,000 shares of common stock at $0.60 per share for the aggregate purchase price of $300. On April 5, 2017, the Company issued 360,002 shares of its common stock, at a price of $0.75 per share, for the cancellation of $270 in demand promissory notes. Between May 9, 2017 and June 18, 2017, the Company issued an aggregate of 956,153 shares of its common stock as payment for services to its consultant. The shares were valued at $498, an average of $0.52 per share On June 28, 2017, the Company issued 189,091 shares of its common stock, at a price of $0.55 per share, for the cancellation of a 7% convertible promissory note in the principal amount of $104. On June 28, 2017, the holders of $55 of in short-term loans agreed to cancel their notes for the purchase of 100,001 shares of the Digital Power’s common stock at a price of $0.55 per share. |
RELATED PARTY TRANSACTION
RELATED PARTY TRANSACTION | 6 Months Ended |
Jun. 30, 2017 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTION | 14. RELATED PARTY TRANSACTION a. In anticipation of the acquisition of MTIX Ltd., an advanced materials and processing technology company located in Huddersfield, West Yorkshire, UK ( “MTIX” Subject to adjustment, AVLP During the period from March 29, 2017 to June, 2017, the Company funded $970 in excess of the $1,500 net loan amount required pursuant to the terms of the AVLP Notes. The Company and AVLP have agreed that these additional advances shall feature terms mirroring those of the AVLP Notes, including 12% annual interest and an original issue discount of 5%; however, in addition to these terms, the Company and AVLP are in the process of finalizing additional terms that will be incorporated into a fourth convertible promissory note agreement (See Note 4). During the six months ended June 30, 2017, the Company invested $1,520 pursuant to the AVLP Notes and acquired 17,080 shares of AVLP common stock in the open market for $7. During the three months ended December 31, 2016, the Company invested $950 pursuant to 250,900 shares of AVLP common stock in the open market for $85. Philou is AVLP’s controlling shareholder. Mr. Ault is Chairman of AVLP’s Board of Directors and the Executive Chairman of the Company’s Board of Directors. Mr. William B. Horne is the Chief Financial Officer of AVLP and also the audit committee chairman of the Company. On October 24, 2016, AVLP entered into a letter of intent to acquire MTIX and made an initial payment of $50 towards the purchase. On March 3, 2017, AVLP entered into a Share Exchange Agreement with MTIX and the three current shareholders of MTIX. Upon the terms and subject to the conditions set forth in the Share Exchange Agreement, AVLP will acquire MTIX from the MTIX shareholders through the transfer of all issued and outstanding ordinary shares of MTIX (the “MTIX Shares” On the closing date, the fully-diluted AVLP shares shall be approximately 52 million shares of common stock, assuming that (i) the MTIX promissory notes are convertible into shares of AVLP common stock at a conversion price of $0.50 per share, (ii) the shares of AVLP Class B Convertible Preferred Stock are convertible into shares of AVLP common stock at a conversion rate of $0.50 per share and (iii) the issuance of stock options to purchase an aggregate of 531,919 shares of AVLP common stock to the members of the MTIX management group. During March 2017, the Company was awarded a 3-year, $50 million purchase order by MTIX to manufacture, install and service the MLSE plasma-laser system. b. On September 22, 2016, the Company entered into consulting agreement with Mr. Ault to assist the Company in developing a business strategy, identifying new business opportunities, developing a capital raising program and implementing of a capital deployment program. For his services, Mr. Ault was paid $90 during the six months ended June 30, 2017. c. On October 21, 2016, the Company entered into a 12% convertible secured note in the principal amount of $530 and warrants with the Barry Blank Living Trust, an existing stockholder of the Company, for $500 due on October 20, 2019. The principal amount of the 12% convertible secured note may be convertible into shares of the Company’s common stock at $0.55 per share. Subject to certain beneficial ownership limitations, the Barry Blank Living Trust may convert the principal amount of the convertible note at any time into common stock. During the six months ended June 30, 2017 the Company recorded interest expenses of $32 on the convertible note obligation. d. On December 29, 2016, the Company received a $250 short term loan from MCKEA. Kristine Ault, a director of the Company and the wife of Mr. Ault, is the managing member of MCKEA which, in turn, is the Manager of Philou, the majority stockholder of the Company. On March 24, 2017, the $250 loan was cancelled in consideration for the issuance of 25,000 shares of Series B preferred stock of the Company to Philou. During the six months ended June 30, 2017 the Company recorded interest expenses of $3 on the e. In February 2017, the Company issued to eight accredited investors f. On March 9, 2017, the Company entered into a Preferred Stock Purchase Agreement with Philou. Pursuant to the terms of the Preferred Stock Purchase Agreement, Philou may invest up to $5,000,000 in the Company through the purchase of Series B Preferred Stock over 36 months. Between March 24, 2017 and June 2, 2017, Philou purchased 100,000 shares of Series B Preferred Stock pursuant to the terms of the Preferred Stock Purchase Agreement. g. On March 15, 2017, Company entered into a subscription agreement with a related party for the sale of 500,000 shares of common stock at $0.60 per share for the aggregate purchase price of $300. h. On March 20, 2017, the Company received a $250 short term loan from JLA Realty, an entity which owns 666,667 shares of the Company’s common stock, constituting approximately 7.5% of the Company’s outstanding shares of common stock, on behalf of Philou. The proceeds from this short term loan comprised a portion of Philou’s purchase of Series B Preferred Stock. i. Between May 5, 2017 and June 30, 2017, the Company received additional short-term loans of $140 from four accredited investors of which $75 was from the Company’s corporate counsel, a related party. As additional consideration, the investors received five-year warrants to purchase 224,371 shares of common stock at a weighted average exercise price of $0.77 per share.On June 28, 2017, $52 in short-term loans that was received from the related party was converted into one of the Series C Units (See Note 9). |
SEGMENT CUSTOMERS AND GEOGRAPHI
SEGMENT CUSTOMERS AND GEOGRAPHICAL INFORMATION | 6 Months Ended |
Jun. 30, 2017 | |
Segment Reporting [Abstract] | |
SEGMENT CUSTOMERS AND GEOGRAPHICAL INFORMATION | 15. SEGMENT, CUSTOMERS AND GEOGRAPHICAL INFORMATION The Company has two reportable geographic segments; see Note 1 for a brief description of the Company’s business. The following data presents the revenues, expenditures and other operating data of the Company’s geographic operating segments and presented in accordance with ASC No. 280. Six months ended June 30, 2017 (unaudited) DPC DPL Eliminations Total Revenues $ 2,329 $ 1,121 $ — $ 3,450 Inter-segment revenues $ 37 $ — $ (37 ) $ — Total revenues $ 2,366 $ 1,121 $ (37 ) $ 3,450 Depreciation and amortization expense $ 43 $ 37 $ — $ 80 Operating income (loss) $ (2,140 ) $ (91 ) $ — $ (2,231 ) Other income, net $ (614 ) Net loss attributable to non-controlling interest $ 112 Net income (loss) $ (2,733 ) Capital expenditures for segment assets, as of June 30, 2017 $ 8 $ 13 $ — $ 21 Identifiable assets as of June 30, 2017 $ 12,315 $ 1,666 $ — $ 13,981 Six months ended June 30, 2016 (unaudited) DPC DPL Eliminations Total Revenues $ 2,160 $ 1,617 $ — $ 3,777 Inter-segment revenues $ 62 $ — $ (62 ) $ — Total revenues $ 2,222 $ 1,617 $ (62 ) $ 3,777 Depreciation and amortization expense $ 38 $ 45 $ — $ 83 Operating income (loss) $ (181 ) $ (8 ) $ — $ (189 ) Interest income, net $ 62 Net income (loss) $ (127 ) Capital expenditures for segment assets, as of June 30, 2016 $ 23 $ 51 $ — $ 74 Identifiable assets as of June 30, 2016 $ 2,157 $ 2,407 $ — $ 4,564 Three months ended June 30, 2017 (unaudited) DPC DPL Eliminations Total Revenues $ 1,316 $ 506 $ — $ 1,822 Inter-segment revenues $ 12 $ — $ (12 ) $ — Total revenues $ 1,328 $ 506 $ (12 ) $ 1,822 Depreciation and amortization expense $ 27 $ 20 $ — $ 47 Operating income (loss) $ (1,396 ) $ (48 ) $ — $ (1,444 ) Interest expense, net $ (407 ) Net loss attributable to non-controlling interest $ 112 Net income (loss) $ (1,739 ) Capital expenditures for segment assets, as of June 30, 2017 $ 8 $ 11 $ — $ 19 Identifiable assets as of June 30, 2017 $ 12,315 $ 1,666 $ — $ 13,981 Three months ended June 30, 2016 (unaudited) DPC DPL Eliminations Total Revenues $ 1,212 $ 852 $ — $ 2,064 Inter-segment revenues $ 6 $ — $ (56 ) $ — Total revenues $ 1,268 $ 852 $ (56 ) $ 2,064 Depreciation and amortization expense $ 19 $ 24 $ — $ 43 Operating income (loss) $ 33 $ (22 ) $ — $ 11 Other income, net $ 55 Net income (loss) $ 66 Capital expenditures for segment assets, as of June 30, 2016 $ — $ 3 $ — $ 3 Identifiable assets as of June 30, 2016 $ 2,157 $ 2,407 $ — $ 4,564 The following table provides the percentage of total revenues attributable to a single customer from which 10% or more of total revenues are derived: For the three months ended June 30, 2017 For the six months ended June 30, 2017 Total Revenues Total Revenues by Major Percentage of by Major Percentage of Customers Total Company Customers Total Company (in thousands) Revenues (in thousands) Revenues Customer A $ 320 19 % $ 629 18 % For the three months ended June 30, 2016 For the six months ended June 30, 2016 Total Revenues Total Revenues by Major Percentage of by Major Percentage of Customers Total Company Customers Total Company (in thousands) Revenues (in thousands) Revenues Customer A $ 443 21 % $ 768 20 % Customer B $ 287 14 % $ — — Revenue from Customer A was attributable to Digital Power and revenue from Customer B and C attributable to DP Limited. For the three and six months ended June 30, 2017 and 2016, total revenues from external customers divided on the basis of the Company’s product lines are as follows: For the Three Months Ended June 30, For the Six Months Ended June 30, 2017 2016 2017 2016 Revenues: Commercial products $ 1,083 $ 1,413 $ 2,023 $ 2,460 Defense products 739 651 1,427 1,317 Total revenues $ 1,822 $ 2,064 $ 3,450 $ 3,777 Financial data relating to geographic areas: The Company’s total revenues are attributed to geographic areas based on the location. The following table presents total revenues for the three and six months ended June 30, 2017 and 2016. Other than as shown, no foreign country contributed materially to revenues or long-lived assets for these periods: For the Three Months Ended June 30, For the Six Months Ended June 30, 2017 2016 2017 2016 Revenues: North America $ 1,184 $ 1,287 $ 2,180 $ 2,226 Europe 386 490 901 1,244 South Korea 116 287 219 297 Other 136 - 150 10 Total revenues $ 1,822 $ 2,064 $ 3,450 $ 3,777 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2017 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 16. SUBSEQUENT EVENTS In accordance with FASB ASC 855-10, the Company has analyzed its operations subsequent to March 31, 2017 and has determined that it does not have any material subsequent events to disclose in these financial statements except for the following. On July 6, 2017, the Company received funding as a result of entering into two Agreements for the Purchase and Sale of Future Receipts with TVT Capital LLC pursuant to which the Company sold in the aggregate $1,091,220 in Future Receipts of the Company for $780,000. Under the terms of the agreements, the Company will be obligated to pay the initial daily amount of $5,456.50 which represents the product of the Company’s average monthly sales times 15% divided by the average business days in a calendar month until the $1,091,220 has been paid in full. The term Future Receipts means cash, check, ACH, credit card, debit card, bank card, charged card or other form of monetary payment. On July 24 2017, we entered into subscription agreements with six investors, and on July 25, 2017 we entered into securities purchase agreements (the “Securities Purchase Agreement”) with an institutional investor, under which we agreed to issue and sell in the aggregate 851,363 shares of common stock to the investors at $0.55 per share for an aggregate purchase price of $468,250. Of the aggregate purchase price of $468,250, $345,250 will be paid in cash and $123,000 will be in consideration for the cancellation of debt of the Company. In a concurrent private placement, we agreed to sell to the institutional investor warrants to purchase an aggregate of 163,636 shares of the Company’s common stock, no par value per share (“Common Stock”), at an exercise price equal to $0.55 per share (“Warrant”) (the “Private Placement”). We expect to receive aggregate net cash proceeds, after deducting estimated expenses related to the registered direct offering and the private placement, in the amount of approximately $335,250. We intend to use the net proceeds from this offering to pay off a convertible note in the aggregate of $125,000 and certain expenses related thereto. The remaining balance will be used for working capital. On July 28 2017, we entered into an Exchange Agreement with an institutional investor who is an owner of (i) a convertible note in the principal amount of $125,000 (“Convertible Note”) dated April 17, 2017, and due June 2, 2017 and in which the principal is convertible into shares of common stock at $0.75 per share; and (ii) a warrant dated April 17, 2017 to purchase 83,334 shares of our common stock at $0.90 (“Prior Warrant”). Under the terms of the Exchange Agreement, we agreed to exchange (i) the Convertible Note for three new promissory notes in the principal amounts of $110,000 due August 1, 2017; $35,000 due August 1, 2017; and $34,000 due August 8, 2017 (individually an Exchange Note and collectively the Exchange Notes) and (ii) the Prior Warrant for a new Warrant (“Exchange Warrant”) to purchase 83,334 shares of common stock at $0.55 per share. Concurrent with entering into the Exchange Agreement, the institutional investor entered into a subscription agreement under which we agreed to issue and sell in a registered direct offering 200,000 shares of common stock at $0.55 per share for an aggregate purchase price of $110,000 (“Registered Direct Offering”). The 200,000 shares of common stock will be purchased through the cancellation of the Exchange Note in the principal amount of $110,000. In addition, in a concurrent private placement (the “Private Placement”), the institutional investor entered into a separate securities purchase agreement under which we agreed to issue and sell 63,600 shares of common stock at $0.55 per share for an aggregate of purchase price of $35,000. The 63,600 shares of common stock will be purchased through the cancellation of the Exchange Note in the principal amount of $35,000. Further, we issued a warrant to purchase 120,000 shares of common stock at $0.55 per share (“Warrant”). On August 3, 2017, the Company entered into a Securities Purchase Agreement (“Agreement”) to sell a 12% Convertible (“Convertible Note”) and a warrant to purchase 666,666 shares of common stock to an accredited investor (the “Investor”). The principal of the Convertible Note may be converted into shares of common stock at $0.55 per share and under the terms of the Warrant, up to 666,666 shares of common stock may be purchased at an exercise price of $0.70 per share. The Convertible Note is in the principal amount of $400,000 and was sold for $360,000, bears interest at 12% simple interest on the principal amount, and is due on August 13, 2018. Interest only payments are due on a quarterly basis and the principal is due on August 3, 2018. The principal may be converted into shares of the Company’s common stock at $0.55 per share. On August 3, 2017, Coolisys Technologies, Inc., a Delaware corporation and wholly owned subsidiary of the Company, entered into a Securities Purchase Agreement (“Agreement”) to acquire all of the outstanding Membership Interests of Power-Plus Technical Distributors, LLC, a California limited liability company. Power-Plus Technical Distributors is an industrial distributor of value added power supply solutions, UPS systems, fans, filters, line cords, and other power-related components. For the year ended December 31, 2016, Power-Plus Technical Distributor generated revenues of approximately $2,200. Under the terms of the Agreement, Coolisys Technologies will acquire all of the Membership Interests of Power-Plus Technical Distributors for the purchase price of $850,000. The purchase price of $850,000 will be paid by (i) the assumption of loans (or pay off of such loans) in the approximate amount of $198,000; (ii) a two year promissory note in the amount of $255,000 payable in 24 monthly installments; and (iii) cash at closing of approximately $397,000. The closing of the acquisition of the Membership Interests in Power-Plus Technical Distributors is subject to certain conditions including entering into agreements with Power-Plus Technical Distributors’ banks to allow Coolisys Technologies to assume such loans or payoff such loans. It is anticipated that the closing will occur on or around September 1, 2017. On August 10, 2017, Digital Power Corporation, a California corporation (the “Company”), entered into Securities Purchase Agreements (“Agreements”) with five institutional investors (the “Investors”) to sell for an aggregate purchase price of $800,000, 10% Senior Convertible Promissory Notes (“Convertible Notes”) with an aggregate principal face amount of $880,000 and warrants to purchase an aggregate of 1,466,667 shares of common stock. The principal of the Convertible Notes and interest earned thereon may be converted into shares of common stock at $0.60 per share and under the terms of the Warrant, up to 1,466,667 shares of common stock may be purchased at an exercise price of $0.66 per share. The Convertible Notes are in the aggregate principal amount of $880,000 and were sold for $800,000 and bear simple interest at 10% on the principal amount, and principal and interest are due on February 10, 2018. Subject to certain beneficial ownership limitations, each Investor may convert the principal amount of the Convertible Note and accrued interest earned thereon at any time into shares of common stock at $0.60 per share. The conversion price of the Convertible Notes is subject to adjustment for customary stock splits, stock dividends, combinations or similar events. |
BASIS OF PRESENTATION AND SIG22
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The condensed consolidated financial statements include the accounts of Digital Power, its wholly-owned subsidiaries, DP Limited and DP Lending and its majority-owned subsidiary, Microphase. All significant intercompany accounts and transactions have been eliminated in consolidation. |
Accounting Estimates | Accounting Estimates The preparation of financial statements, in conformity with GAAP, requires management to make estimates, judgments and assumptions. The Company's management believes that the estimates, judgments and assumptions used are reasonable based upon information available at the time they are made. These estimates, judgments and assumptions can affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements, and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates. Key estimates include fair value of certain financial instruments, reserve for trade receivables and inventories, carrying amounts of investments, accruals of certain liabilities, and deferred income taxes and related valuation allowance. |
Investments in Debt and Equity Securities | Investments in Debt and Equity Securities The Company classifies its investments in Avalanche International, Corp ( “AVLP” Investment in Debt and Equity Securities “ASC No. 320” Investment – Other “ASC No. 325” |
Revenue Recognition | Revenue Recognition The Company generates revenues from the sale of its products through a direct and indirect sales force. Revenues from products are recognized in accordance with ASC No. 605, Revenue Recognition |
Warranty | Warranty The Company offers a warranty period for all of its products. Warranty periods range from one to two years depending on the product. The Company estimates the costs that may be incurred under its warranty and records a liability in the amount of such costs at the time product revenue is recognized. Factors that affect the Company's warranty liability include the number of units sold, historical rates of warranty claims and cost per claim. The Company periodically assesses the adequacy of its recorded warranty liability and adjusts the amounts as necessary. As of June 30, 2017 and December 31, 2016, the Company’s accrued warranty liability was $86. |
Common Stock Purchase Warrants and Other Derivative Financial Instruments | Common Stock Purchase Warrants and Other Derivative Financial Instruments The Company classifies common stock purchase warrants and other free standing derivative financial instruments as equity if the contracts (i) require physical settlement or net-share settlement or (ii) give the Company a choice of net-cash settlement or settlement in its own shares (physical settlement or net-share settlement). The Company classifies any contracts that (i) require net-cash settlement (including a requirement to net cash settle the contract if an event occurs and if that event is outside the control of the Company), (ii) give the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement), or (iii) contain reset provisions as either an asset or a liability. The Company assesses classification of its freestanding derivatives at each reporting date to determine whether a change in classification between assets and liabilities is required. The Company determined that certain freestanding derivatives, which principally consist of issuance of warrants to purchase shares of common in connection with convertible notes, units and to employees of the Company, satisfy the criteria for classification as equity instruments as these warrants do not contain cash settlement features or variable settlement provision that cause them to not be indexed to the Company’s own stock. |
Stock Based Compensation | Stock-Based Compensation The Company accounts for stock-based compensation in accordance with ASC No. 718, Compensation – Stock Compensation "ASC No. 718" The Company’s accounting policy for equity instruments issued to consultants and vendors in exchange for goods and services follows the provisions of ASC No. 505-50, Equity Based Payments to Non-Employees |
Convertible Instruments | Convertible Instruments The Company accounts for hybrid contracts that feature conversion options in accordance with ASC No. 815, Derivatives and Hedging Activities “ASC No. 815” Conversion options that contain variable settlement features such as provisions to adjust the conversion price upon subsequent issuances of equity or equity linked securities at exercise prices more favorable than that featured in the hybrid contract generally result in their bifurcation from the host instrument. The Company accounts for convertible instruments, when the Company has determined that the embedded conversion options should not be bifurcated from their host instruments, in accordance with ASC No. 470-20, Debt with Conversion and Other Options “ASC No. 470-20” |
Comprehensive Loss | Comprehensive Loss The Company reports comprehensive loss in accordance with ASC No. 220, Comprehensive Income |
Fair value of Financial Instruments | Fair value of Financial Instruments In accordance with ASC No. 820, Fair Value Measurements and Disclosures The guidance also establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the factors that market participants would use in valuing the asset or liability. The guidance establishes three levels of inputs that may be used to measure fair value: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or model-derived valuations. All significant inputs used in our valuations are observable or can be derived principally from or corroborated with observable market data for substantially the full term of the assets or liabilities Level 2 inputs also include quoted prices that were adjusted for security-specific restrictions which are compared to output from internally developed models such as a discounted cash flow models. Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The carrying amounts of financial instruments carried at cost, including cash and cash equivalents, trade receivables and trade receivable – related party, investments, notes receivable, trade payables and trade payables – related party approximate their fair value due to the short-term maturities of such instruments. As of June 30, 2017 and December 31, 2016, the fair value of the Company’s investments were $2,582 and $1,036, respectively, and were concentrated in debt and equity securities of AVLP, a related party (See Note 4), which are classified as available-for-sale investments. At June 30, 2017, the Company's investment in AVLP is comprised of convertible promissory notes of $2,491, net of unamortized discount, and marketable equity securities of $91. At December 31, 2016, the Company's investment in AVLP is comprised of convertible promissory notes of $952, net of unamortized discount, and marketable equity securities of $84. For investments in marketable equity securities, the Company took into consideration general market conditions, the duration and extent to which the fair value is below cost, and the Company’s ability and intent to hold the investment for a sufficient period of time to allow for recovery of value in the foreseeable future. As a result of this analysis, the Company has determined that its cost basis in AVLP equitable securities approximates the current fair value. Consistent with the guidance at ASC No. 835, the Company’s presumption is that the fair value of its convertible promissory notes in AVLP have a present value equivalent to the cash proceeds exchanged. Further, the discount shall be reported in the balance sheet as a direct deduction from the face amount of the convertible promissory notes. Thus, the Company has determined that the amortized cost of its convertible promissory notes approximates fair value and are subject to a periodic impairment review. The interest income, including amortization of the discount arising at acquisition, for the convertible promissory notes are included in earnings. In the future, if the Company does not expect to recover the entire amortized cost basis, the Company shall recognize other-than-temporary impairments in other comprehensive income (loss). In the first quarter of 2017, the Company purchased at the market shares of common stock of three companies for a total cost of $20. In accordance with ASC No. 320-10, these investments are accounted for pursuant to the fair value method. Based upon the closing market prices of common stock for these three companies at June 30, 2017, and most recently at August 15, 2017, the Company determined that its cost basis in the shares of common stock for these companies approximates the current fair value and has concluded that its investment in marketable securities is not impaired. The categorization of a financial instrument within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The following table sets forth the Company’s financial instruments that were measured at fair value on a recurring basis by level within the fair value hierarchy: Fair Value Measurement at June 30, 2017 Total Level 1 Level 2 Level 3 Investments – AVLP – a related party $ 2,582 $ 91 $ 2,491 $ — Investments in other companies $ 20 $ 20 $ — $ — Fair Value Measurement at December 31, 2016 Total Level 1 Level 2 Level 3 Investments – AVLP – a related party $ 1,036 $ 84 $ 952 $ — |
Debt Discounts | Debt Discounts The Company accounts for debt discount according to ASC No. 470-20, Debt with Conversion and Other Options |
Net Loss per Share | Net Loss per Share Net loss per share is computed by dividing the net loss to common stockholders by the weighted average number of common shares outstanding. The calculation of the basic and diluted earnings per share is the same for all periods presented, as the effect of the potential common stock equivalents is anti-dilutive due to the Company’s net loss position for all periods presented. The Company has included 317,460 warrants, with an exercise price of $.01, in its earnings per share calculation for the three and six months ended June 30, 2017. Anti-dilutive securities consisted of the following at June 30, 2017 2016 Stock options 2,841,000 1,106,000 Warrants 7,426,080 — Convertible notes 1,296,969 — Conversion of preferred stock 4,606,131 — Total 16,170,180 1,106,000 |
Recently Issued Accounting Standards | Recently Issued Accounting Standards The Company has considered all other recently issued accounting standards and does not believe the adoption of such standards will have a material impact on its condensed consolidated financial statements. |
BASIS OF PRESENTATION AND SIG23
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
Schedule of fair value measurement | The following table sets forth the Company’s financial instruments that were measured at fair value on a recurring basis by level within the fair value hierarchy: Fair Value Measurement at June 30, 2017 Total Level 1 Level 2 Level 3 Investments – AVLP – a related party $ 2,582 $ 91 $ 2,491 $ — Investments in other companies $ 20 $ 20 $ — $ — Fair Value Measurement at December 31, 2016 Total Level 1 Level 2 Level 3 Investments – AVLP – a related party $ 1,036 $ 84 $ 952 $ — |
Schedule of Anti-dilutive securities | Anti-dilutive securities consisted of the following at June 30, 2017 2016 Stock options 2,841,000 1,106,000 Warrants 7,426,080 — Convertible notes 1,296,969 — Conversion of preferred stock 4,606,131 — Total 16,170,180 1,106,000 |
INVESTMENTS - RELATED PARTIES (
INVESTMENTS - RELATED PARTIES (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of investment | Investments in AVLP at June 30, 2017, and December 31, 2016, are comprised of the following: June 30, December 31, 2017 2016 Investment in convertible promissory note of AVLP $ 2,593 $ 997 Investment in common stock of AVLP 91 84 Total investment in AVLP P – Gross 2,684 1,081 Less: original issue discount (102 ) (45 ) Total investment in AVLP P – Net $ 2,582 $ 1,036 |
ACQUISITION (Tables)
ACQUISITION (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Business Combinations [Abstract] | |
Schedule of business combinations | Upon initial measurement, components of the purchase price are as follows: Cash and cash equivalents $ 11 Accounts receivable, net 439 Inventories, net 667 Prepaid expenses and other current assets 139 Restricted cash 100 Intangible assets 95 Property and equipment, net 93 Other investments 303 Deposits and loans 44 Accounts payable and accrued expenses (1,680 ) Revolving credit facility (880 ) Notes payable (2,204 ) Notes payable, related parties (406 ) Convertible notes payable 0 Other current liabilities (327 ) Net liabilities assumed (3,606 ) Goodwill 6,002 Minority interest (945 ) Purchase price $ 1,451 |
Schedule of the pro forma | These pro forma amounts do not purport to be indicative of the results that would have actually been obtained if the acquisition occurred as of the beginning of each period presented or that may be obtained in future periods: For the Three Months Ended June 30, For the Six Months Ended June 30, 2017 2016 2017 2016 Revenue $ 2,714 $ 4,017 $ 5,408 $ 7,848 Net loss $ (1,924 ) $ (651 ) $ (4,076 ) $ (1,099 ) Less: Net loss attributable to non-controlling interest 127 313 632 424 Net loss attributable to Digital Power Corp $ (1,797 ) $ (338 ) $ (3,444 ) $ (675 ) Preferred deemed dividends (319 ) — (319 ) — Preferred dividends (8 ) — (8 ) — Loss available to common shareholders $ (2,124 ) $ (338 ) $ (3,771 ) $ (675 ) Basic and diluted net loss per common share $ (0.17 ) $ (0.04 ) $ (0.33 ) $ (0.08 ) Basic and diluted weighted average common shares outstanding 12,310,106 8,618,419 11,273,393 8,618,419 Comprehensive Loss Loss available to common shareholders $ (2,124 ) $ (338 ) $ (3,771 ) $ (675 ) Other comprehensive income (loss) Change in net foreign currency translation adjustments 78 (152 ) 99 (210 ) Net unrealized gain (loss) on securities available-for- sale, net of income taxes 0 — 130 18 Other comprehensive income (loss) 78 (152 ) 229 (192 ) Total Comprehensive loss $ (2,046 ) $ (490 ) $ (3,542 ) $ (86 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of weighted average assumptions | During the six months ended June 30, 2017, the Company estimated the fair value of stock options granted using the Black-Scholes option pricing model with the following weighted average assumptions: June 30, 2017 Weighted average risk free interest rate 1.89% — 2.14 % Weighted average life (in years) 5.0 Volatility 98.41% — 98.55 % Expected dividend yield 0 % Weighted average grant-date fair value per share of options granted $ 0.45 |
Schedule of options outstanding exercise price | The options outstanding as of June 30, 2017, have been classified by exercise price, as follows: Outstanding Exercisable Weighted Average Weighted Weighted Remaining Average Average Exercise Number Contractual Exercise Number Exercise Price Outstanding Life (Years) Price Exercisable Price $0.60 - $0.79 2,375,000 9.38 $ 0.66 1,246,667 $ 0.66 $1.10 - $1.32 25,000 6.35 $ 1.28 15,000 $ 1.25 $1.51 - $1.69 441,000 5.36 $ 1.61 378,500 $ 1.60 $0.60 - 1.69 2,841,000 8.73 $ 1.10 1,640,167 $ 0.88 |
Schedule of stock-based compensation expense | The total stock-based compensation expense related to stock options and restricted stock awards to the Company’s employees, consultants and directors, included in reported net loss Three Months Ended Six Months Ended June 30, 2017 June 30, 2016 June 30, 2017 June 30, 2016 Cost of revenues $ 3 $ 2 $ 4 $ 4 Engineering and product development 6 1 13 2 Selling and marketing 6 4 11 8 General and administrative 557 36 668 73 Total stock-based compensation $ 572 $ 43 $ 696 $ 87 |
Schedule of option activity under the company's stock option | A summary of option activity under the Company's stock option plans as of June 30, 2017, and changes during the six months ended are as follows: Outstanding Options Weighted Weighted Average Shares Average Remaining Aggregate Available Number Exercise Contractual Intrinsic for Grant of Shares Price Life (years) Value December 31, 2016 3,247,630 2,331,000 $ 0.83 9.08 $ 0 Restricted stock awards (956,153 ) Grants (510,000 ) 510,000 $ 0.60 June 30, 2017 1,781,477 2,841,000 $ 0.81 8.73 $ 148 |
WARRANTS (Tables)
WARRANTS (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Warrants | |
Schedule of common stock warrants outstanding | The following table summarizes information about common stock warrants outstanding at June 30, 2017: Outstanding Exercisable Weighted Average Weighted Weighted Remaining Average Average Exercise Number Contractual Exercise Number Exercise Price Outstanding Life (Years) Price Exercisable Price $0.01 317,460 9.35 $ 0.01 79,364 $ 0.01 $0.70 1,761,905 5.20 $ 0.70 — — $0.72 182,003 4.97 $ 0.72 — — $0.75 135,909 4.88 $ 0.75 — — $0.80 1,415,128 2.80 $ 0.80 1,166,666 $ 0.80 $0.90 611,670 3.85 $ 0.90 265,000 $ 0.90 $1.00 2,002,005 4.93 $ 1.00 — — $1.10 1,000,000 2.92 $ 1.10 — — $0.01 - 1.10 7,426,080 4.42 $ 0.84 1,511,030 $ 0.78 |
Schedule of option pricing | The Company utilized the Black-Scholes option pricing model and the assumptions used during the six months ended June 30, 2017: June 30, 2017 Weighted average risk free interest rate 1.42% — 2.01 % Weighted average life (in years) 4.8 Volatility 98.5% — 107.1 % Expected dividend yield 0 % Weighted average grant-date fair value per share of warrants granted $ 0.38 |
NOTES PAYABLE (Tables)
NOTES PAYABLE (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Notes Payable Tables | |
Schedule of notes payble | Notes Payable at June 30, 2017, and December 31, 2016, are comprised of the following: June 30, December 31, 2017 2016 10% short-term promissory notes (a) $ 705 $ — Notes payable to Lucosky Brookman, LLP (b) 450 — Notes payable to Wells Fargo (c) 308 — Note payable to Department of Economic and Community Development (d) 300 — Note payable to People's United Bank ( e) 20 — Other short-term notes payable (f) 33 — Total notes payable 1,816 — Less: current portion (1,218 ) — Notes payable – long-term portion $ 569 $ — |
NOTES PAYABLE RELATED PARTIES (
NOTES PAYABLE RELATED PARTIES (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Notes Payable Related Parties Tables | |
Schedule of notes payable related parties | Notes Payable – Related parties at June 30, 2017, and December 31, 2016, are comprised of the following: June 30, December 31, 2017 2016 Notes payable to MCKEA Holdings, LLC (a) $ — $ 250 Notes payable to former officer and employee (b) 406 — Total notes payable 406 250 Less: current portion (278 ) ( 250) Notes payable – long-term portion $ 128 $ — |
CONVERTIBLE NOTES (Tables)
CONVERTIBLE NOTES (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Long-term Debt, Unclassified [Abstract] | |
Schedule of convertable notes | Convertible notes at June 30, 2017, and December 31, 2016, are comprised of the following: June 30, December 31, 2017 2016 7% Convertible note $ 250 $ — Convertible note $ 250 $ — |
CONVERTIBLE NOTE RELATED PARTY
CONVERTIBLE NOTE RELATED PARTY (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Long-term Debt, Unclassified [Abstract] | |
Schedule of convertable note related party | Convertible notes – related party at June 30, 2017, and December 31, 2016, are comprised of the following: June 30, December 31, 2017 2016 12% Convertible secured note $ 530 $ 530 Less: Unamortized debt discounts (398 ) (484 ) Unamortized financing cost (10 ) (12 ) Convertible note – related party $ 122 $ 34 |
SEGMENT CUSTOMERS AND GEOGRAP32
SEGMENT CUSTOMERS AND GEOGRAPHICAL INFORMATION (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Segment Reporting [Abstract] | |
Schedule of geographic operating segments | The following data presents the revenues, expenditures and other operating data of the Company’s geographic operating segments and presented in accordance with ASC No. 280. Six months ended June 30, 2017 (unaudited) DPC DPL Eliminations Total Revenues $ 2,329 $ 1,121 $ — $ 3,450 Inter-segment revenues $ 37 $ — $ (37 ) $ — Total revenues $ 2,366 $ 1,121 $ (37 ) $ 3,450 Depreciation and amortization expense $ 43 $ 37 $ — $ 80 Operating income (loss) $ (2,140 ) $ (91 ) $ — $ (2,231 ) Other income, net $ (614 ) Net loss attributable to non-controlling interest $ 112 Net income (loss) $ (2,733 ) Capital expenditures for segment assets, as of June 30, 2017 $ 8 $ 13 $ — $ 21 Identifiable assets as of June 30, 2017 $ 12,315 $ 1,666 $ — $ 13,981 Six months ended June 30, 2016 (unaudited) DPC DPL Eliminations Total Revenues $ 2,160 $ 1,617 $ — $ 3,777 Inter-segment revenues $ 62 $ — $ (62 ) $ — Total revenues $ 2,222 $ 1,617 $ (62 ) $ 3,777 Depreciation and amortization expense $ 38 $ 45 $ — $ 83 Operating income (loss) $ (181 ) $ (8 ) $ — $ (189 ) Interest income, net $ 62 Net income (loss) |
Schedules of total revenues | For the three and six months ended June 30, 2017 and 2016, total revenues from external customers divided on the basis of the Company’s product lines are as follows: For the Three Months Ended June 30, For the Six Months Ended June 30, 2017 2016 2017 2016 Revenues: Commercial products $ 1,083 $ 1,413 $ 2,023 $ 2,460 Defense products 739 651 1,427 1,317 Total revenues $ 1,822 $ 2,064 $ 3,450 $ 3,777 |
Schedule of Revenue from external customers | For the three and six months ended June 30, 2017 and 2016, total revenues from external customers divided on the basis of the Company’s product lines are as follows: For the Three Months Ended June 30, For the Six Months Ended June 30, 2017 2016 2017 2016 Revenues: Commercial products $ 1,083 $ 1,413 $ 2,023 $ 2,460 Defense products 739 651 1,427 1,317 Total revenues $ 1,822 $ 2,064 $ 3,450 $ 3,777 |
Schedule of total revenues are attributed to geographic areas | The Company’s total revenues are attributed to geographic areas based on the location. The following table presents total revenues for the three and six months ended June 30, 2017 and 2016. Other than as shown, no foreign country contributed materially to revenues or long-lived assets for these periods: For the Three Months Ended June 30, For the Six Months Ended June 30, 2017 2016 2017 2016 Revenues: North America $ 1,184 $ 1,287 $ 2,180 $ 2,226 Europe 386 490 901 1,244 South Korea 116 287 219 297 Other 136 - 150 10 Total revenues $ 1,822 $ 2,064 $ 3,450 $ 3,777 |
DESCRIPTION OF BUSINESS (Detail
DESCRIPTION OF BUSINESS (Details Narrative) - Segment | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 02, 2017 | Apr. 28, 2017 | |
Restructuring Cost and Reserve [Line Items] | |||
Number of reportable segments | 2 | ||
Microphase Corporation [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Ownership percentage | 56.40% | 56.40% |
LIQUIDITY, GOING CONCERN AND 34
LIQUIDITY, GOING CONCERN AND MANAGEMENT'S PLANS (Details Narrative) $ / shares in Units, $ in Thousands | Jun. 28, 2017USD ($)$ / sharesshares | May 05, 2017USD ($)shares | Apr. 05, 2017$ / sharesshares | Apr. 03, 2017USD ($) | Mar. 31, 2017USD ($) | Mar. 24, 2017USD ($)shares | Mar. 20, 2017USD ($) | Mar. 15, 2017USD ($)$ / sharesshares | Mar. 09, 2017USD ($) | Jun. 19, 2017USD ($)$ / shares | Mar. 31, 2017USD ($) | Feb. 28, 2017USD ($)Investor$ / sharesshares | Jun. 30, 2017USD ($)Investor$ / sharesshares | Jun. 02, 2017shares | Jun. 30, 2017USD ($)Investor$ / sharesshares | Jun. 30, 2016USD ($) | Jun. 30, 2017USD ($)Investor$ / sharesshares | Jun. 30, 2016USD ($) | Apr. 26, 2017USD ($)$ / sharesshares | Apr. 17, 2017USD ($)Note$ / sharesshares | Mar. 28, 2017USD ($) | Dec. 31, 2016USD ($) | Oct. 21, 2016shares | Dec. 31, 2015USD ($) |
Cash and cash equivalent | $ 443 | $ 443 | $ 1,212 | $ 443 | $ 1,212 | $ 996 | $ 1,241 | |||||||||||||||||
Accumulated deficit | (15,218) | (15,218) | (15,218) | $ (12,158) | ||||||||||||||||||||
Working capital | $ (1,785) | (1,785) | (1,785) | |||||||||||||||||||||
Net income (loss) attributable to parent | $ (1,739) | $ 66 | $ (2,733) | $ (127) | ||||||||||||||||||||
Number of warrants | shares | 180,000 | 333,333 | 1,428,572 | 530,000 | ||||||||||||||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 0.90 | $ 0.70 | $ 0.84 | $ 0.84 | $ 0.84 | |||||||||||||||||||
Debt face amount | $ 400 | |||||||||||||||||||||||
Number of shares issued during the period | shares | 189,091 | 500,000 | ||||||||||||||||||||||
Warrant term | 4 years 5 months 1 day | |||||||||||||||||||||||
Debt Due to MCKEA [Member] | ||||||||||||||||||||||||
Extinguishment of debt | $ 250 | |||||||||||||||||||||||
Demand Promissory Notes [Member] | ||||||||||||||||||||||||
Number of warrants | shares | 180,002 | |||||||||||||||||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 0.90 | |||||||||||||||||||||||
Proceeds from notes payable | 400 | |||||||||||||||||||||||
Debt face amount | 400 | $ 270 | ||||||||||||||||||||||
Extinguishment of debt | $ 400 | |||||||||||||||||||||||
Proceeds from issuance of debt | $ 50 | $ 220 | $ 250 | |||||||||||||||||||||
Common Stock [Member] | ||||||||||||||||||||||||
Number of warrants | shares | 180,000 | |||||||||||||||||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 0.90 | |||||||||||||||||||||||
Number of shares issued during the period | shares | 360,000 | |||||||||||||||||||||||
Share price (in dollars per share) | $ / shares | $ 0.75 | |||||||||||||||||||||||
Common Stock [Member] | One Investor [Member] | ||||||||||||||||||||||||
Number of shares issued during the period | shares | 500,000 | |||||||||||||||||||||||
Share price (in dollars per share) | $ / shares | $ 0.60 | |||||||||||||||||||||||
Value of shares issued during the period | $ 300 | |||||||||||||||||||||||
Common Stock [Member] | Holders of Demand Promissory Notes [Member] | ||||||||||||||||||||||||
Number of shares issued during the period | shares | 666,667 | |||||||||||||||||||||||
Share price (in dollars per share) | $ / shares | $ 0.60 | |||||||||||||||||||||||
7% Two Convertible Notes [Member] | ||||||||||||||||||||||||
Number of warrants | shares | 160,000 | 166,668 | ||||||||||||||||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 0.80 | $ 0.90 | ||||||||||||||||||||||
Debt face amount | $ 104 | $ 250 | ||||||||||||||||||||||
Interest rate | 7.00% | |||||||||||||||||||||||
Conversion of shares outstanding | shares | 189,091 | |||||||||||||||||||||||
Number of convertible notes | Note | 2 | |||||||||||||||||||||||
Share price (in dollars per share) | $ / shares | $ 0.75 | |||||||||||||||||||||||
Accredited Investor [Member] | ||||||||||||||||||||||||
Number of warrants | shares | 224,371 | 224,371 | 224,371 | |||||||||||||||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 0.77 | $ 0.77 | $ 0.77 | |||||||||||||||||||||
Debt face amount | $ 400 | $ 140 | $ 140 | $ 140 | ||||||||||||||||||||
Share price (in dollars per share) | $ / shares | $ 0.80 | $ 0.80 | $ 0.80 | |||||||||||||||||||||
Interest rate | 6.00% | |||||||||||||||||||||||
Number of investors | Investor | 8 | 4 | 4 | 4 | ||||||||||||||||||||
Warrant term | 5 years | |||||||||||||||||||||||
Philou Ventures, LLC [Member] | ||||||||||||||||||||||||
Preferred stock purchase agreement, maximum investment amount agreed upon | $ 5,000 | |||||||||||||||||||||||
Preferred stock purchase agreement, term | 3 years | |||||||||||||||||||||||
MTIX [Member] | MLSE Plasma-Laser System [Member] | ||||||||||||||||||||||||
Supply commitment, term | 3 years | |||||||||||||||||||||||
Supply commitment, amount committed | $ 50 | $ 50 | ||||||||||||||||||||||
Four Accredited Investor [Member] | Other short-term notes payable [Member] | ||||||||||||||||||||||||
Number of warrants | shares | 224,371 | 224,371 | 224,371 | |||||||||||||||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 0.77 | $ 0.77 | $ 0.77 | |||||||||||||||||||||
Amount of share canceled | $ 55 | |||||||||||||||||||||||
Number of share canceled | shares | 100,001 | |||||||||||||||||||||||
Share price (in dollars per share) | $ / shares | $ 0.55 | |||||||||||||||||||||||
Series C Preferred Stock [Member] | ||||||||||||||||||||||||
Conversion of shares outstanding | shares | 52 | |||||||||||||||||||||||
Series B Preferred Stock [Member] | Philou Ventures, LLC [Member] | ||||||||||||||||||||||||
Number of shares issued during the period | shares | 50,000 | 25,000 | 1,000,000 | |||||||||||||||||||||
Value of shares issued during the period | $ 500 | |||||||||||||||||||||||
Series C Preferred Stock and Warrants [Member] | Accredited Investor [Member] | Series C Subscription Agreement [Member] | ||||||||||||||||||||||||
Share price (in dollars per share) | $ / shares | $ 52 | |||||||||||||||||||||||
Value of shares issued during the period | $ 1,092 |
LIQUIDITY, GOING CONCERN AND 35
LIQUIDITY, GOING CONCERN AND MANAGEMENT'S PLANS (Details Narrative 1) - Subsequent Event [Member] $ in Thousands | 7 Months Ended |
Aug. 17, 2017USD ($) | |
Proceeds from issuance of debt | $ 1,505 |
Exchange of convertible notes | $ 268 |
BASIS OF PRESENTATION AND SIG36
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Available-for-sale securities | $ 2,582 | $ 1,036 |
Avalanche International Corp. [Member] | ||
Available-for-sale securities | 2,491 | 952 |
Avalanche International Corp. [Member] | Fair Value, Measurements, Recurring [Member] | ||
Available-for-sale securities | 2,582 | 1,036 |
Avalanche International Corp. [Member] | Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | ||
Available-for-sale securities | 91 | 84 |
Avalanche International Corp. [Member] | Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | ||
Available-for-sale securities | 2,491 | $ 952 |
Other Companies [Member] | Fair Value, Measurements, Recurring [Member] | ||
Available-for-sale securities | 20 | |
Other Companies [Member] | Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | ||
Available-for-sale securities | $ 20 |
BASIS OF PRESENTATION AND SIG37
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Details 1) - shares | 6 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Anti-dilutive securities | 16,170,180 | 1,106,000 |
Employee Stock Option [Member] | ||
Anti-dilutive securities | 2,841,000 | 1,106,000 |
Warrant [Member] | ||
Anti-dilutive securities | 7,426,080 | |
Convertible Notes [Member] | ||
Anti-dilutive securities | 1,296,969 | |
Convertible Debt Securities [Member] | ||
Anti-dilutive securities | 4,606,131 |
BASIS OF PRESENTATION AND SIG38
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2017 | Mar. 31, 2017 | Jun. 30, 2017 | Apr. 05, 2017 | Feb. 28, 2017 | Dec. 31, 2016 | |
Accrued warranty liability | $ 86 | $ 86 | $ 86 | |||
Available-for-sale securities | 2,582 | 2,582 | 1,036 | |||
Payments to acquire investments | 1,527 | |||||
Amortization of debt discount | $ 397 | $ 592 | ||||
Warrant outstanding | 7,426,080 | 7,426,080 | ||||
Exercise price of warrants (in dollars per share) | $ 0.84 | $ 0.84 | $ 0.90 | $ 0.70 | ||
Avalanche International Corp. [Member] | ||||||
Available-for-sale securities | $ 2,491 | $ 2,491 | 952 | |||
Available-for-sale securities, equity securities | $ 91 | $ 91 | $ 84 | |||
Warrant [Member] | ||||||
Warrant outstanding | 317,460 | 317,460 | ||||
Exercise price of warrants (in dollars per share) | $ 0.01 | $ 0.01 | ||||
Common Stock [Member] | ||||||
Payments to acquire investments | $ 20 |
INVESTMENTS - RELATED PARTIES39
INVESTMENTS - RELATED PARTIES (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2017 | Dec. 31, 2016 | |
Total investment in AVLP P - Net | $ 2,582 | $ 1,036 |
Avalanche International Corp. [Member] | ||
Investment in convertible promissory note of AVLP | 2,593 | 997 |
Investment in common stock of AVLP | 91 | 84 |
Total investment in AVLP P - Gross | 2,684 | 1,081 |
Less: original issue discount | 102 | (45) |
Total investment in AVLP P - Net | $ 2,582 | $ 1,036 |
INVESTMENTS - RELATED PARTIES40
INVESTMENTS - RELATED PARTIES (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2017 | Jun. 30, 2017 | Feb. 22, 2017 | Dec. 31, 2016 | Nov. 30, 2016 | Oct. 05, 2016 | |
Share price (in dollars pers share) | $ 0.72 | $ 0.72 | ||||
Avalanche International Corp. [Member] | ||||||
Financing receivable, gross | $ 1,500 | |||||
Excess Funding of Note Receivable [Member] | Avalanche International Corp. [Member] | ||||||
Interest rate | 12.00% | 12.00% | ||||
Financing receivable, gross | $ 970 | $ 970 | ||||
Financing receivable, discount rate | 5.00% | 5.00% | ||||
Financing receivable, discount | $ 970 | $ 970 | ||||
Notes Receivable [Member] | Avalanche International Corp. [Member] | ||||||
Financing receivable, discount | $ 123 | $ 123 | ||||
Financing receivable, conversion ratio | 0.74536 | 0.74536 | ||||
Financing receivable, convertible feature, number of shares issuable | 2,113,086 | 2,113,086 | ||||
Interest Income, Related Party | $ 12 | $ 19 | ||||
Interest receivable | $ 93 | $ 93 | $ 13 | |||
Notes Receivable February 22, 2017 [Member] | Avalanche International Corp. [Member] | ||||||
Interest rate | 12.00% | |||||
Financing receivable, gross | $ 525 | |||||
Financing receivable, discount rate | 5.00% | |||||
Financing receivable, discount | $ 75 | |||||
Notes Receivable, November 30, 2016 [Member] | Avalanche International Corp. [Member] | ||||||
Interest rate | 12.00% | |||||
Financing receivable, gross | $ 525 | |||||
Financing receivable, discount rate | 5.00% | |||||
Financing receivable, discount | $ 75 | |||||
Notes Receivable, October 5, 2016 [Member] | Avalanche International Corp. [Member] | ||||||
Interest rate | 12.00% | |||||
Financing receivable, gross | $ 525 | |||||
Financing receivable, discount rate | 5.00% | |||||
Financing receivable, discount | $ 75 | |||||
Avalanche International Corp. [Member] | ||||||
Share price (in dollars pers share) | $ 0.17 | $ 0.17 | ||||
Avalanche International Corp. [Member] | Minimum [Member] | ||||||
Share price (in dollars pers share) | 0.17 | 0.17 | ||||
Avalanche International Corp. [Member] | Maximum [Member] | ||||||
Share price (in dollars pers share) | $ 0.38 | $ 0.38 |
ACQUISITION (Details)
ACQUISITION (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2017 | Dec. 31, 2016 | |
Restructuring Cost and Reserve [Line Items] | ||
Goodwill | $ 6,002 | |
Microphase Corporation [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Cash and cash equivalents | 11 | |
Accounts receivable, net | 439 | |
Inventories, net | 667 | |
Prepaid expenses and other current assets | 139 | |
Restricted cash | 100 | |
Intangible assets | 95 | |
Property and equipment, net | 93 | |
Other investments | 303 | |
Deposits and loans | 44 | |
Accounts payable and accrued expenses | (1,680) | |
Revolving credit facility | (880) | |
Notes payable | (2,204) | |
Notes payable, related parties | (406) | |
Convertible notes payable | 0 | |
Other current liabilities | (327) | |
Net liabilities assumed | (3,606) | |
Goodwill | 6,002 | |
Minority interest | (945) | |
Purchase price | $ 1,451 |
ACQUISITION (Details 1)
ACQUISITION (Details 1) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Restructuring Cost and Reserve [Line Items] | ||||
Net loss | $ (1,851) | $ 66 | $ (2,845) | $ (127) |
Less: Net loss attributable to non-controlling interest | $ 112 | $ 112 | ||
Basic and diluted weighted average common shares outstanding (in shares) | 10,467,658 | 6,775,971 | 9,430,945 | 6,775,971 |
Microphase Corporation [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Revenue | $ 2,714 | $ 4,017 | $ 5,408 | $ 7,848 |
Net loss | (1,924) | (651) | (4,076) | (1,099) |
Less: Net loss attributable to non-controlling interest | 127 | 313 | 632 | 424 |
Net loss attributable to Digital Power Corp | (1,797) | (338) | (3,444) | (675) |
Preferred deemed dividends | (319) | (319) | ||
Preferred dividends | (8) | (8) | ||
Loss available to common shareholders | $ (2,124) | $ (338) | $ (3,771) | $ (675) |
Basic and diluted net loss per common share (in dollars per share) | $ (0.17) | $ (0.04) | $ (0.33) | $ (0.08) |
Basic and diluted weighted average common shares outstanding (in shares) | 12,310,106 | 8,618,419 | 11,273,393 | 8,618,419 |
Comprehensive Loss | ||||
Loss available to common shareholders | $ (2,124) | $ (338) | $ (3,771) | $ (675) |
Other comprehensive income (loss) | ||||
Change in net foreign currency translation adjustments | 78 | (152) | 99 | (210) |
Net unrealized gain (loss) on securities available-for-sale, net of income taxes | 0 | 130 | 18 | |
Other comprehensive income (loss) | 78 | (152) | 229 | (192) |
Total Comprehensive loss | $ (2,046) | $ (490) | $ (3,542) | $ (867) |
ACQUISITION (Details Narrative)
ACQUISITION (Details Narrative) - USD ($) $ in Thousands | Apr. 28, 2017 | Jun. 30, 2017 | Jun. 02, 2017 |
Warrant [Member] | |||
Number of shares issued | 1,000,000 | ||
Share Exchange Agreement [Member] | Series D Preferred Stock [Member] | |||
Number of shares issued | 378,776 | ||
Share Exchange Agreement [Member] | Series D Preferred Stock [Member] | Common Stock And Warrants [Member] | |||
Number of shares converted | 757,552 | ||
Share Exchange Agreement [Member] | Common Stock [Member] | |||
Number of shares issued | 1,842,448 | ||
Microphase Corporation [Member] | |||
Ownership percentage | 56.40% | 56.40% | |
Equity instruments issued | $ 1,451 | ||
Microphase Corporation [Member] | Common Stock And Warrants [Member] | |||
Equity instruments issued | 229 | ||
Microphase Corporation [Member] | Series D Preferred Stock [Member] | |||
Equity instruments issued | $ 1,222 | ||
Microphase Corporation [Member] | Share Exchange Agreement [Member] | Common Stock [Member] | |||
Common stock, shares issued | 1,603,434 | ||
Common stock, shares outstanding | 1,603,434 |
STOCK-BASED COMPENSATION (Detai
STOCK-BASED COMPENSATION (Details) | 6 Months Ended |
Jun. 30, 2017$ / shares | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Weighted average risk free interest rate, minimum | 1.89% |
Weighted average risk free interest rate, maximum | 2.14% |
Weighted average life (in years) | 5 years |
Volatility, minimum | 98.41% |
Volatility, maximum | 98.55% |
Expected dividend yield | 0.00% |
Weighted average grant-date fair value per share of options granted | $ 0.45 |
STOCK-BASED COMPENSATION (Det45
STOCK-BASED COMPENSATION (Details 1) | 6 Months Ended |
Jun. 30, 2017$ / sharesshares | |
Exercise Price, lower limit | $ 0.60 |
Exercise Price, upper limit | $ 1.69 |
Options Outstanding | shares | 2,841,000 |
Weighted Average Remaining Contractual Life (Years) | 8 years 8 months 23 days |
Weighted Average Exercise Price, Outstanding | $ 1.10 |
Options Exercisable | shares | 1,640,167 |
Weighted Average Exercise Price, Exercisable | $ 0.88 |
Exercise Price Range 1 [Member] | |
Exercise Price, lower limit | 0.60 |
Exercise Price, upper limit | $ 0.79 |
Options Outstanding | shares | 2,375,000 |
Weighted Average Remaining Contractual Life (Years) | 9 years 4 months 17 days |
Weighted Average Exercise Price, Outstanding | $ 0.66 |
Options Exercisable | shares | 1,246,667 |
Weighted Average Exercise Price, Exercisable | $ 0.66 |
Exercise Price Range 2 [Member] | |
Exercise Price, lower limit | 1.10 |
Exercise Price, upper limit | $ 1.32 |
Options Outstanding | shares | 25,000 |
Weighted Average Remaining Contractual Life (Years) | 6 years 4 months 6 days |
Weighted Average Exercise Price, Outstanding | $ 1.28 |
Options Exercisable | shares | 15,000 |
Weighted Average Exercise Price, Exercisable | $ 1.25 |
Exercise Price Range 3 [Member] | |
Exercise Price, lower limit | 1.51 |
Exercise Price, upper limit | $ 1.69 |
Options Outstanding | shares | 441,000 |
Weighted Average Remaining Contractual Life (Years) | 5 years 4 months 10 days |
Weighted Average Exercise Price, Outstanding | $ 1.61 |
Options Exercisable | shares | 378,500 |
Weighted Average Exercise Price, Exercisable | $ 1.60 |
STOCK-BASED COMPENSATION (Det46
STOCK-BASED COMPENSATION (Details 2) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Total stock-based compensation | $ 572 | $ 43 | $ 696 | $ 87 |
Cost of Revenues [Member] | ||||
Total stock-based compensation | 3 | 2 | 4 | 4 |
Engineering and Product Development [Member] | ||||
Total stock-based compensation | 6 | 1 | 13 | 2 |
Selling and Marketing [Member] | ||||
Total stock-based compensation | 6 | 4 | 11 | 8 |
General and Administrative [Member] | ||||
Total stock-based compensation | $ 557 | $ 36 | $ 668 | $ 73 |
STOCK-BASED COMPENSATION (Det47
STOCK-BASED COMPENSATION (Details 3) - 2016 Stock Incentive Plan and 2012 Stock Option Plan [Member] $ / shares in Units, $ in Thousands | 6 Months Ended |
Jun. 30, 2017USD ($)$ / sharesshares | |
Balance, shares available for grant at beginning | 3,247,630 |
Balance, outstanding at beginning | 2,331,000 |
Balance, weighted average exercise price, at beginning | $ / shares | $ 0.83 |
Balance, weighted average remaining contractual life (years) at beginning | 9 years 29 days |
Balance, aggregate intrinsic value at beginning | $ | $ 0 |
Grants, shares available for grant of restricted stock award | |
Grants, shares available for grant | (510,000) |
Grants (in shares) | 510,000 |
Grants, weighted average exercise price (in dollars per share) | $ / shares | $ 0.60 |
Balance, shares available for grant at end | 1,781,477 |
Balance, outstanding at end | 2,841,000 |
Balance, weighted average exercise price, at end | $ / shares | $ 0.81 |
Balance, weighted average remaining contractual life (years) at end | 8 years 8 months 23 days |
Balance, aggregate intrinsic value at end | $ | $ 148 |
Restricted Stock Awards [Member] | |
Grants, shares available for grant of restricted stock award | (956,153) |
STOCK-BASED COMPENSATION (Det48
STOCK-BASED COMPENSATION (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | Jun. 28, 2017 | Apr. 05, 2017 | Mar. 15, 2017 | Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 |
Share-based compensation expense | $ 572 | $ 43 | $ 696 | $ 87 | |||
Share price (in dollars per share) | $ 0.72 | $ 0.72 | |||||
Number of shares issued | 189,091 | 500,000 | |||||
Restricted Stock Awards [Member] | |||||||
Share-based compensation expense | $ 10 | ||||||
Aggregate Stock-based Compensation [Member] | |||||||
Share-based compensation expense | $ 595 | 752 | |||||
Common Stock [Member] | |||||||
Number of shares issued | 360,000 | ||||||
Warrant [Member] | |||||||
Share-based compensation expense | $ 23 | $ 46 | |||||
2016 Stock Incentive Plan [Member] | |||||||
Number of shares authorized | 5,372,630 | 5,372,630 | |||||
Number of shares available for grant | 1,781,477 | 1,781,477 | |||||
Compensation cost not yet recognized | $ 524 | $ 524 | |||||
Weighted average period for recognition | 2 years 2 months 12 days | ||||||
2016 Stock Incentive Plan [Member] | Minimum [Member] | |||||||
Expiration period | 5 years | ||||||
2016 Stock Incentive Plan [Member] | Maximum [Member] | |||||||
Expiration period | 10 years | ||||||
2016 Stock Incentive Plan [Member] | Consultants and Service Providers [Member] | Common Stock [Member] | |||||||
Share price (in dollars per share) | $ 499 | $ 499 | |||||
Number of shares issued | 956,153 | ||||||
2002 Stock Option Plan [Member] | |||||||
Number of shares granted | 206,000 | ||||||
2016 Stock Incentive Plan and 2012 Stock Option Plan [Member] | |||||||
Number of shares granted | 510,000 | ||||||
Weighted average exercise price | $ 0.60 | ||||||
2016 Stock Incentive Plan and 2012 Stock Option Plan [Member] | Employee [Member] | |||||||
Vesting period | 4 years | ||||||
Number of shares granted | 510,000 | ||||||
Weighted average exercise price | $ 0.60 | ||||||
Weighted average grant date fair value | $ 229 |
WARRANTS (Details)
WARRANTS (Details) - $ / shares | 6 Months Ended | ||
Jun. 30, 2017 | Apr. 05, 2017 | Feb. 28, 2017 | |
Warrants, outstanding | 7,426,080 | ||
Warrants, outstanding, weighted average remaining contractual life (Years) | 4 years 5 months 1 day | ||
Warrants, outstanding, weighted average exercise price | $ 0.84 | $ 0.90 | $ 0.70 |
Warrants, exercisable | 1,511,030 | ||
Warrants, exercisable, weighted average exercise price | $ 0.78 | ||
Minimum [Member] | |||
Warrants, outstanding, weighted average exercise price | 0.01 | ||
Maximum [Member] | |||
Warrants, outstanding, weighted average exercise price | $ 1.10 | ||
Warrant Exercise Price Range 1 [Member] | |||
Warrants, outstanding | 317,460 | ||
Warrants, outstanding, weighted average remaining contractual life (Years) | 9 years 4 months 6 days | ||
Warrants, outstanding, weighted average exercise price | $ 0.01 | ||
Warrants, exercisable | 79,364 | ||
Warrants, exercisable, weighted average exercise price | $ 0.01 | ||
Warrant Exercise Price Range 2 [Member] | |||
Warrants, outstanding | 1,761,905 | ||
Warrants, outstanding, weighted average remaining contractual life (Years) | 5 years 2 months 12 days | ||
Warrants, outstanding, weighted average exercise price | $ 0.70 | ||
Warrant Exercise Price Range 3 [Member] | |||
Warrants, outstanding | 182,003 | ||
Warrants, outstanding, weighted average remaining contractual life (Years) | 4 years 11 months 19 days | ||
Warrants, outstanding, weighted average exercise price | $ 0.72 | ||
Warrant Exercise Price Range 4 [Member] | |||
Warrants, outstanding | 135,909 | ||
Warrants, outstanding, weighted average remaining contractual life (Years) | 4 years 10 months 17 days | ||
Warrants, outstanding, weighted average exercise price | $ 0.75 | ||
Warrant Exercise Price Range 5 [Member] | |||
Warrants, outstanding | 1,415,128 | ||
Warrants, outstanding, weighted average remaining contractual life (Years) | 2 years 9 months 18 days | ||
Warrants, outstanding, weighted average exercise price | $ 0.80 | ||
Warrants, exercisable | 1,166,666 | ||
Warrants, exercisable, weighted average exercise price | $ 0.80 | ||
Warrant Exercise Price Range 6 [Member] | |||
Warrants, outstanding | 611,670 | ||
Warrants, outstanding, weighted average remaining contractual life (Years) | 3 years 10 months 6 days | ||
Warrants, outstanding, weighted average exercise price | $ 0.90 | ||
Warrants, exercisable | 265,000 | ||
Warrants, exercisable, weighted average exercise price | $ 0.90 | ||
Warrant Exercise Price Range 7 [Member] | |||
Warrants, outstanding | 2,002,005 | ||
Warrants, outstanding, weighted average remaining contractual life (Years) | 4 years 11 months 5 days | ||
Warrants, outstanding, weighted average exercise price | $ 1 | ||
Warrant Exercise Price Range 8 [Member] | |||
Warrants, outstanding | 1,000,000 | ||
Warrants, outstanding, weighted average remaining contractual life (Years) | 2 years 11 months 1 day | ||
Warrants, outstanding, weighted average exercise price | $ 1.10 |
WARRANTS (Details 1)
WARRANTS (Details 1) | 6 Months Ended |
Jun. 30, 2017$ / shares | |
Weighted average risk free interest rate, minimum | 1.89% |
Weighted average risk free interest rate, maximum | 2.14% |
Weighted average life (in years) | 5 years |
Volatility, minimum | 98.41% |
Volatility, maximum | 98.55% |
Expected dividend yield | 0.00% |
Warrant [Member] | |
Weighted average risk free interest rate, minimum | 1.42% |
Weighted average risk free interest rate, maximum | 2.01% |
Weighted average life (in years) | 4 years 9 months 18 days |
Volatility, minimum | 98.50% |
Volatility, maximum | 107.10% |
Expected dividend yield | 0.00% |
Weighted average grant-date fair value per share of warrants granted | $ 0.38 |
WARRANTS (Details Narrative)
WARRANTS (Details Narrative) $ / shares in Units, $ in Thousands | 1 Months Ended | 2 Months Ended | 6 Months Ended | |||||||
Jun. 19, 2017$ / sharesshares | Jun. 30, 2017USD ($)Investor$ / sharesshares | Jun. 30, 2017USD ($)Investor$ / sharesshares | Jun. 02, 2017$ / sharesshares | Apr. 26, 2017USD ($)$ / sharesshares | Apr. 17, 2017USD ($)$ / sharesshares | Apr. 05, 2017USD ($)$ / sharesshares | Mar. 28, 2017USD ($) | Feb. 28, 2017USD ($)Investor$ / sharesshares | Oct. 21, 2016shares | |
Warrant issued during period | 5,567,954 | |||||||||
Warrant issued at exercise price | 0.89 | |||||||||
Warrant issued | 1,428,572 | 180,000 | 333,333 | 530,000 | ||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 0.84 | $ 0.84 | $ 0.90 | $ 0.70 | ||||||
Face amount of debt | $ | $ 400 | |||||||||
7% Two Convertible Notes [Member] | ||||||||||
Warrant issued | 160,000 | 166,668 | ||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 0.80 | $ 0.90 | ||||||||
Face amount of debt | $ | $ 104 | $ 250 | ||||||||
Demand Promissory Notes [Member] | ||||||||||
Warrant issued | 180,002 | |||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 0.90 | |||||||||
Cancellation of note | $ | $ 270 | |||||||||
Face amount of debt | $ | $ 270 | 400 | ||||||||
Accredited Investor [Member] | ||||||||||
Warrant issued during period | 135,909 | |||||||||
Warrant issued at exercise price | 0.75 | |||||||||
Warrant issued | 224,371 | 224,371 | ||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 0.77 | $ 0.77 | ||||||||
Amount of warrants outstanding | $ | $ 88,462 | $ 88,462 | ||||||||
Face amount of debt | $ | $ 140 | $ 140 | $ 400 | |||||||
Share price (in dollars per share) | $ / shares | $ 0.80 | $ 0.80 | ||||||||
Number of investors | Investor | 4 | 4 | 8 | |||||||
Eight Accredited Investor [Member] | Demand Promissory Notes [Member] | ||||||||||
Warrant issued | 333,333 | |||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 0.70 | |||||||||
Face amount of debt | $ | $ 400 | |||||||||
Preferred Stock Purchase Agreement [Member] | Philou Ventures, LLC [Member] | ||||||||||
Warrant issued | 1,428,572 | |||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 0.70 | |||||||||
Share Exchange Agreement [Member] | ||||||||||
Warrant issued | 1,000,000 | |||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 1.10 | |||||||||
Series B Preferred Stock [Member] | Preferred Stock Purchase Agreement [Member] | Philou Ventures, LLC [Member] | ||||||||||
Warrant issued | 100,000 | |||||||||
Warrant [Member] | ||||||||||
Warrant issued during period | 1,820,002 | |||||||||
Discription of stock transaction | Between May 24, 2017 and June 19, 2017, the Company issued warrants to purchase 1,820,002 shares of common stock issued in connection with the sale of twenty-one Units at a purchase price of $52 per Unit raising in the aggregate $1,092. | |||||||||
Warrant [Member] | Divine Capital Markets, LLC ("Divine") [Member] | ||||||||||
Discription of stock transaction | For its services, the Placement Agent received, in addition to a 10.0% commission on the sale of each Unit and a 3.0% non-refundable expense allowance, warrants to purchase 10% of the Units sold at 120% of the Unit purchase price. | |||||||||
Warrant [Member] | Series C Preferred Stock and Warrants [Member] | ||||||||||
Warrant issued | 86,667 | |||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 1 | |||||||||
Number of warrent issued by each unit | 21,667 | |||||||||
Warrant One [Member] | Divine Capital Markets, LLC ("Divine") [Member] | ||||||||||
Warrant issued | 182,003 | |||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 0.72 | |||||||||
Warrant Two [Member] | Divine Capital Markets, LLC ("Divine") [Member] | ||||||||||
Warrant issued | 182,003 | |||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 1 |
REVOLVING CREDIT FACILITY (Deta
REVOLVING CREDIT FACILITY (Details Narrative) - Gerber Finance Inc ("Gerber") [Member] - Revolving Credit Facility [Member] - Revolving loan agreement [Member] - USD ($) $ in Thousands | 1 Months Ended | |
Jun. 30, 2017 | Sep. 30, 2015 | |
Maximum revolving amount | $ 1,400 | |
Revolving credit facility | $ 612 | $ 100 |
Description of facility interest rate | Microphase is subject to an annual facility fee in an amount equal to 1.75% of the Maximum Revolving Amount due on each anniversary, a monthly collateral monitoring fees of $1 and other fees. Interest accrues at the prime rate plus three and three-quarters percent (3.75%) on the unpaid principal. Effective June 15, 2017, the prime rate was increased from 4.00% to 4.25% resulting in a base rate of 8.00%. | |
Discription of collateral fees | If borrowings under the Revolving Credit Facility exceed the collateral borrowing base, then Microphase is subject to an additional 2.5% interest charge per month on the over-advance amounts and a separate additional charge of 2.5% if borrowings exceed the Maximum Revolving Amount. | |
Interest rate during period | 8.00% | |
Percentage of fees | 2.50% | |
Collateral amount | 70 | |
Interest expences | $ 14 |
NOTES PAYABLE (Details)
NOTES PAYABLE (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 | |
Total notes payable | $ 569 | ||
Less: current portion | 1,247 | 250 | |
Notes payable - long-term portion | 569 | ||
Other short-term notes payable [Member] | |||
Total notes payable | [1] | 33 | |
10% short term promissory notes [Member] | |||
Total notes payable | [2] | 705 | |
8% Notes payable to Lucosky Brookman, LLP Due On November 25, 2017 [Member] | |||
Total notes payable | [3] | 450 | |
Notes payable to Wells Fargo [Member] | |||
Total notes payable | [4] | 308 | |
Note payable to Department of Economic and Community Development Due in August 2026 [Member] | |||
Total notes payable | [5] | 300 | |
Note payable to People's United Bank [Member] | |||
Total notes payable | [6] | $ 20 | |
[1] | Between May 5, 2017 and June 30, 2017, Digital Power received additional short-term loans of $140 from four accredited investors. As additional consideration, the investors received five-year warrants to purchase 224,371 shares of common stock at a weighted average exercise price of $0.77 per share. The warrants are exercisable commencing six months after the issuance date and are subject to certain beneficial ownership limitations. The exercise price of these warrants is subject to adjustment for customary stock splits, stock dividends, combinations and other standard anti-dilution events. The warrants may be exercised for cash or on a cashless basis. During the quarter ended June 30, 2017, the Company recorded debt discount in the amount of $95 based on the estimated fair value of these warrants. The Company computed the fair value of these warrants using the Black-Scholes option pricing model. As a result of the short-term feature of these loans and advances, the debt discount was amortized as non-cash interest expense upon issuance of the warrants using the effective interest method. | ||
[2] | In December 2016, Microphase issued $705 in 10% short-term promissory notes to nineteen accredited investors which, after deducting $71 of placement fees to its selling agent, Spartan Capital Securities, LLC ("Spartan"), resulted in $634 in net proceeds to Microphase (the "10% Short-Term Notes"). The 10% Short-Term Notes are due one year from the date of issuance. The amount due pursuant to the 10% Short-Term Notes is equal to the entire original principal amount multiplied by 125% (the "Loan Premium") plus accrued interest. During the period June 3, 2017 to June 30, 2017, Microphase incurred $6 of interest on these 10% short-term promissory notes. Concurrently, Microphase entered into a one-year agreement with Spartan for investment banking services which provided for: (i) $120 of consulting fees that were paid in cash from the proceeds of the 10% Short-Term Notes; and (ii) if Microphase completes an initial public offering, $90 payable in shares of Microphase common stock. As of June 30, 2017, accrued interest on the 10% Short-Term Notes was $145. | ||
[3] | On June 2, 2017, pursuant to the terms of the Share Exchange Agreement and in consideration of legal services, Microphase issued a $450 8% promissory note with a maturity date of November 25, 2017 to Lucosky Brookman, LLP (the "Lucosky Note"). In conjunction with the issuance of the Lucosky Note, the Company issued Lucosky Brookman 10,000 shares of redeemable convertible Series E preferred stock (the "Series E Preferred Stock") with a stated value of $45 per share as an alternative to providing a guarantee for the amount of the Lucosky Note. The Company, at its option, may redeem for cash, in whole or in part, at any time and from time to time, the shares of Series E Preferred Stock at the time outstanding, upon written notice to the holder of the shares, at a cash redemption price equal to $45 multiplied by the number of shares being redeemed. Any such optional redemption by the Company shall be credited against the Lucosky Note. During the period June 3, 2017 to June 30, 2017, Microphase incurred $3 of interest on the Lucosky Note. As of June 30, 2017, accrued interest on the Lucosky Note was $3. | ||
[4] | At June 30, 2017, Microphase had guaranteed the repayment of two equity lines of credit in the aggregate amount of $308 with Wells Fargo Bank, NA ("Wells Fargo") (collectively, the "Wells Fargo Notes"). Microphase had previously guaranteed the payment under the first Wells Fargo equity line during 2008, the proceeds of which Microphase had received from a concurrent loan from Edson Realty Inc., a related party owned real estate holding company. As of June 30, 2017, the first line of credit, which is secured by residential real estate owned by a former officer, had an outstanding balance of $216, with an annual interest rate of 4.00%. Microphase had guaranteed the payment under the second Wells Fargo equity line in 2014. Microphase had received working capital loans from the former CEO from funds that were drawn against the second Wells Fargo equity line. As of June 30, 2017, the second line of credit, secured by the former CEO's principal residence, had an outstanding balance of $92, with an annual interest rate of 3.00%. During the period June 3, 2017 to June 30, 2017, Microphase incurred $1 of interest on the Wells Fargo Notes. | ||
[5] | In August 2016, Microphase received a $300 loan pursuant to the State of Connecticut Small Business Express Job Creation Incentive Program which is administered through the Department of Economic and Community Development ("DECD") (the "DECD Note"). The DECD Note bears interest at a rate of 3% per annum and is due in August 2026. Payment of principal and interest is deferred during the initial year and commencing on the thirteenth month, payable in equal monthly installments over the remaining term. During the period June 3, 2017 to June 30, 2017, Microphase did not incur any interest on the DECD Note. In conjunction with the DECD Note, Microphase was awarded a Small Business Express Matching Grant of $100. State grant funding requires a dollar for dollar match on behalf of Microphase. As of June 2, 2017 and June 30, 2017, the Company has utilized $27 of the grant and the balance of $73 is reported within deferred revenue. | ||
[6] | In December 2016, Microphase utilized a $20 overdraft credit line at People's United Bank with an annual interest rate of 15%. As of June 30, 2017, the balance of that overdraft credit line was $20. |
NOTES PAYABLE (Details Narrativ
NOTES PAYABLE (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | Jun. 28, 2017 | Jun. 02, 2017 | Apr. 05, 2017 | Apr. 03, 2017 | Mar. 31, 2017 | Mar. 28, 2017 | Feb. 28, 2017 | Feb. 23, 2017 | Jun. 30, 2017 | Dec. 31, 2016 | Aug. 31, 2016 | Jun. 30, 2017 | Jun. 30, 2017 | Jun. 30, 2016 | Nov. 03, 2016 | Oct. 21, 2016 | |
Total notes payable | $ 569 | $ 569 | $ 569 | ||||||||||||||
Debt face amount | $ 400 | ||||||||||||||||
Warrant issued | 1,428,572 | 180,000 | 333,333 | 530,000 | |||||||||||||
Exercise price of warrants (in dollars per share) | $ 0.90 | $ 0.70 | $ 0.84 | $ 0.84 | $ 0.84 | ||||||||||||
Debt discount | $ 398 | 484 | $ 398 | $ 398 | |||||||||||||
Number of convertible securities cancellation | 360,002 | 666,667 | |||||||||||||||
Exercise price of convertible securities | $ 0.75 | $ 0.60 | |||||||||||||||
Interest expense | 13 | ||||||||||||||||
Original debt amount | $ 270 | $ 400 | |||||||||||||||
Convertible Securities issued | 100,001 | ||||||||||||||||
Value of convertible securities per share | $ 55 | 625 | |||||||||||||||
Chief Executive Officer [Member] | |||||||||||||||||
Warrant issued | 317,460 | ||||||||||||||||
Exercise price of warrants (in dollars per share) | $ 0.01 | ||||||||||||||||
Other short-term notes payable [Member] | |||||||||||||||||
Total notes payable | [1] | 33 | 33 | 33 | |||||||||||||
Four Accredited Investor [Member] | Other short-term notes payable [Member] | |||||||||||||||||
Total notes payable | $ 140 | $ 140 | $ 140 | ||||||||||||||
Warrant term | 5 years | ||||||||||||||||
Warrant issued | 224,371 | 224,371 | 224,371 | ||||||||||||||
Exercise price of warrants (in dollars per share) | $ 0.77 | $ 0.77 | $ 0.77 | ||||||||||||||
Debt discount | $ 95 | $ 95 | $ 95 | ||||||||||||||
Amount of share canceled | $ 55 | ||||||||||||||||
Number of share canceled | 100,001 | ||||||||||||||||
Share price (in dollars per share) | $ 0.55 | ||||||||||||||||
Description of conversion | An additional $52 in short-term loans was converted into one of the Series C Units. The Company did not record any additional interest expense as a result of the conversion of $107 in short-term loans since the carrying amount of the short-term loans was equivalent to the fair value of the consideration transferred, which was determined from the closing price of the Company’s equity securities on the date of conversion. | ||||||||||||||||
Demand Promissory Notes [Member] | |||||||||||||||||
Debt face amount | $ 270 | $ 400 | |||||||||||||||
Warrant issued | 180,002 | ||||||||||||||||
Exercise price of warrants (in dollars per share) | $ 0.90 | ||||||||||||||||
Number of convertible securities cancellation | 666,667 | ||||||||||||||||
Exercise price of convertible securities | $ 0.60 | ||||||||||||||||
Interest expense | $ 13 | ||||||||||||||||
Original debt amount | 400 | $ 400,000 | |||||||||||||||
Proceeds from Convertible Debt | $ 50 | $ 220 | |||||||||||||||
Demand Promissory Notes [Member] | Several Investor [Member] | |||||||||||||||||
Debt face amount | $ 270 | ||||||||||||||||
Interest rate | 6.00% | ||||||||||||||||
Demand Promissory Notes [Member] | Eight Accredited Investor [Member] | |||||||||||||||||
Debt face amount | $ 400 | ||||||||||||||||
Interest rate | 6.00% | ||||||||||||||||
Warrant term | 5 years | ||||||||||||||||
Warrant issued | 333,333 | ||||||||||||||||
Exercise price of warrants (in dollars per share) | $ 0.70 | ||||||||||||||||
Debt discount | $ 151 | ||||||||||||||||
10% short term promissory notes [Member] | |||||||||||||||||
Total notes payable | [2] | 705 | 705 | 705 | |||||||||||||
10% short term promissory notes [Member] | Nineteen accredited investors [Member] | Microphase Corporation [Member] | |||||||||||||||||
Total notes payable | $ 705 | ||||||||||||||||
Term of notes payable | 1 year | ||||||||||||||||
Accrued interest on debt | 6 | 145 | |||||||||||||||
Proceeds from Convertible Debt | $ 634 | ||||||||||||||||
Placement fees | $ 71 | ||||||||||||||||
Debt payment term | The amount due pursuant to the 10% Short-Term Notes is equal to the entire original principal amount multiplied by 125% (the “ | ||||||||||||||||
Consulting fees | 120 | ||||||||||||||||
Issuance initial public offering | 50 | ||||||||||||||||
8% Notes payable to Lucosky Brookman, LLP Due On November 25, 2017 [Member] | |||||||||||||||||
Total notes payable | [3] | 450 | 450 | 450 | |||||||||||||
8% Notes payable to Lucosky Brookman, LLP Due On November 25, 2017 [Member] | Microphase Corporation [Member] | |||||||||||||||||
Total notes payable | $ 450 | ||||||||||||||||
Accrued interest on debt | 3 | 3 | |||||||||||||||
8% Notes payable to Lucosky Brookman, LLP Due On November 25, 2017 [Member] | Microphase Corporation [Member] | Redeemable Convertible Series B Preferred Stock [Member] | |||||||||||||||||
Convertible Securities issued | 10,000 | ||||||||||||||||
Value of convertible securities per share | $ 45 | ||||||||||||||||
Notes payable to Wells Fargo [Member] | |||||||||||||||||
Total notes payable | [4] | 308 | 308 | 308 | |||||||||||||
Notes payable to Wells Fargo [Member] | Wells Fargo Bank, NA ("Wells Fargo") [Member] | Two equity lines of credit [Member] | |||||||||||||||||
Total notes payable | 308 | 308 | 308 | ||||||||||||||
Accrued interest on debt | 1 | ||||||||||||||||
Notes payable to Wells Fargo [Member] | Wells Fargo Bank, NA ("Wells Fargo") [Member] | One equity lines of credit [Member] | Former officer [Member] | |||||||||||||||||
Total notes payable | $ 216 | $ 216 | $ 216 | ||||||||||||||
Interest rate | 4.00% | 4.00% | 4.00% | ||||||||||||||
Notes payable to Wells Fargo [Member] | Wells Fargo Bank, NA ("Wells Fargo") [Member] | One equity lines of credit [Member] | Chief Executive Officer [Member] | |||||||||||||||||
Total notes payable | $ 92 | $ 92 | $ 92 | ||||||||||||||
Interest rate | 3.00% | 3.00% | 3.00% | ||||||||||||||
Note payable to Department of Economic and Community Development Due in August 2026 [Member] | |||||||||||||||||
Total notes payable | [5] | $ 300 | $ 300 | $ 300 | |||||||||||||
Note payable to Department of Economic and Community Development Due in August 2026 [Member] | Department of Economic and Community Development ("DECD") [Member] | |||||||||||||||||
Total notes payable | $ 300 | ||||||||||||||||
Interest rate | 3.00% | ||||||||||||||||
Debt payment term | Payment of principal and interest is deferred during the initial year and commencing on the thirteenth month, payable in equal monthly installments over the remaining term. | ||||||||||||||||
Grant additional funding | $ 100 | ||||||||||||||||
Deferred revenue | 73 | ||||||||||||||||
Granted fund utilized | $ 27 | ||||||||||||||||
Note payable to People's United Bank [Member] | |||||||||||||||||
Total notes payable | [6] | 20 | 20 | 20 | |||||||||||||
Note payable to People's United Bank [Member] | Overdraft credit line [Member] | |||||||||||||||||
Total notes payable | $ 20 | $ 20 | $ 20 | $ 20 | |||||||||||||
Interest rate | 15.00% | ||||||||||||||||
[1] | Between May 5, 2017 and June 30, 2017, Digital Power received additional short-term loans of $140 from four accredited investors. As additional consideration, the investors received five-year warrants to purchase 224,371 shares of common stock at a weighted average exercise price of $0.77 per share. The warrants are exercisable commencing six months after the issuance date and are subject to certain beneficial ownership limitations. The exercise price of these warrants is subject to adjustment for customary stock splits, stock dividends, combinations and other standard anti-dilution events. The warrants may be exercised for cash or on a cashless basis. During the quarter ended June 30, 2017, the Company recorded debt discount in the amount of $95 based on the estimated fair value of these warrants. The Company computed the fair value of these warrants using the Black-Scholes option pricing model. As a result of the short-term feature of these loans and advances, the debt discount was amortized as non-cash interest expense upon issuance of the warrants using the effective interest method. | ||||||||||||||||
[2] | In December 2016, Microphase issued $705 in 10% short-term promissory notes to nineteen accredited investors which, after deducting $71 of placement fees to its selling agent, Spartan Capital Securities, LLC ("Spartan"), resulted in $634 in net proceeds to Microphase (the "10% Short-Term Notes"). The 10% Short-Term Notes are due one year from the date of issuance. The amount due pursuant to the 10% Short-Term Notes is equal to the entire original principal amount multiplied by 125% (the "Loan Premium") plus accrued interest. During the period June 3, 2017 to June 30, 2017, Microphase incurred $6 of interest on these 10% short-term promissory notes. Concurrently, Microphase entered into a one-year agreement with Spartan for investment banking services which provided for: (i) $120 of consulting fees that were paid in cash from the proceeds of the 10% Short-Term Notes; and (ii) if Microphase completes an initial public offering, $90 payable in shares of Microphase common stock. As of June 30, 2017, accrued interest on the 10% Short-Term Notes was $145. | ||||||||||||||||
[3] | On June 2, 2017, pursuant to the terms of the Share Exchange Agreement and in consideration of legal services, Microphase issued a $450 8% promissory note with a maturity date of November 25, 2017 to Lucosky Brookman, LLP (the "Lucosky Note"). In conjunction with the issuance of the Lucosky Note, the Company issued Lucosky Brookman 10,000 shares of redeemable convertible Series E preferred stock (the "Series E Preferred Stock") with a stated value of $45 per share as an alternative to providing a guarantee for the amount of the Lucosky Note. The Company, at its option, may redeem for cash, in whole or in part, at any time and from time to time, the shares of Series E Preferred Stock at the time outstanding, upon written notice to the holder of the shares, at a cash redemption price equal to $45 multiplied by the number of shares being redeemed. Any such optional redemption by the Company shall be credited against the Lucosky Note. During the period June 3, 2017 to June 30, 2017, Microphase incurred $3 of interest on the Lucosky Note. As of June 30, 2017, accrued interest on the Lucosky Note was $3. | ||||||||||||||||
[4] | At June 30, 2017, Microphase had guaranteed the repayment of two equity lines of credit in the aggregate amount of $308 with Wells Fargo Bank, NA ("Wells Fargo") (collectively, the "Wells Fargo Notes"). Microphase had previously guaranteed the payment under the first Wells Fargo equity line during 2008, the proceeds of which Microphase had received from a concurrent loan from Edson Realty Inc., a related party owned real estate holding company. As of June 30, 2017, the first line of credit, which is secured by residential real estate owned by a former officer, had an outstanding balance of $216, with an annual interest rate of 4.00%. Microphase had guaranteed the payment under the second Wells Fargo equity line in 2014. Microphase had received working capital loans from the former CEO from funds that were drawn against the second Wells Fargo equity line. As of June 30, 2017, the second line of credit, secured by the former CEO's principal residence, had an outstanding balance of $92, with an annual interest rate of 3.00%. During the period June 3, 2017 to June 30, 2017, Microphase incurred $1 of interest on the Wells Fargo Notes. | ||||||||||||||||
[5] | In August 2016, Microphase received a $300 loan pursuant to the State of Connecticut Small Business Express Job Creation Incentive Program which is administered through the Department of Economic and Community Development ("DECD") (the "DECD Note"). The DECD Note bears interest at a rate of 3% per annum and is due in August 2026. Payment of principal and interest is deferred during the initial year and commencing on the thirteenth month, payable in equal monthly installments over the remaining term. During the period June 3, 2017 to June 30, 2017, Microphase did not incur any interest on the DECD Note. In conjunction with the DECD Note, Microphase was awarded a Small Business Express Matching Grant of $100. State grant funding requires a dollar for dollar match on behalf of Microphase. As of June 2, 2017 and June 30, 2017, the Company has utilized $27 of the grant and the balance of $73 is reported within deferred revenue. | ||||||||||||||||
[6] | In December 2016, Microphase utilized a $20 overdraft credit line at People's United Bank with an annual interest rate of 15%. As of June 30, 2017, the balance of that overdraft credit line was $20. |
NOTES PAYABLE - RELATED PARTIES
NOTES PAYABLE - RELATED PARTIES (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Jun. 30, 2017 | Dec. 31, 2016 | |
Defined Benefit Plan Disclosure [Line Items] | ||||
Total notes payable | $ 250 | $ 128 | ||
Less: current portion | 278 | |||
Notes payable - long-term portion | 128 | |||
MCKEA [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total notes payable | [1] | 205 | ||
Former officer and employee [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total notes payable | [2] | $ 406 | ||
[1] | On December 29, 2016, the Company entered into an agreement with MCKEA Holdings, LLC ("MCKEA"). MCKEA is the majority member of Philou Ventures, LLC, which is the Company's controlling shareholder. Kristine L. Ault, a director and the wife of Milton C. Ault III, Executive Chairman of the Company's Board of Directors, is the manager and owner of MCKEA, for a demand promissory note (The "MCKEA Note") in the amount of $250 bearing interest at the rate of 6% per annum on unpaid principal. The MCKEA Note may be prepaid, in whole or in part, without penalty, at the option of the Company and without the consent of MCKEA. As of December 31, 2016, no interest was accrued on the MCKEA Note. On March 24, 2017, the MCKEA Note was cancelled to purchase the Company's Series B Preferred Stock pursuant to the terms of the Preferred Stock Purchase Agreement entered into on March 9, 2017 (See Note 13). Since there was no difference between the reacquisition price and the net carrying value of the cancelled debt, no gain or loss was recognized as a result of this transaction. | |||
[2] | Microphase is a party to several notes payable agreements with seven of its past officers, employees and their family members. As of June 30, 2017, the aggregate outstanding balance pursuant to these notes payable agreements was $488, with annual interest rates ranging between 3.00% and 6.00%. During the period June 3, 2017 to June 30, 2017, Microphase incurred $2 of interest on these notes payable agreements. In July 2016, one of these noteholders initiated litigation to collect the balance owed under the terms of his respective agreement. At June 30, 2017, the outstanding principal balance owed under this particular agreement was $152. |
NOTES PAYABLE - RELATED PARTI56
NOTES PAYABLE - RELATED PARTIES (Details Narrative) $ in Thousands | 6 Months Ended | |||
Jun. 30, 2017USD ($)Number | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 29, 2016USD ($) | |
Notes payable from related parties | $ 278 | |||
Interest payable | 16 | 12 | ||
MCKEA [Member] | Notes Payable, Other Payables [Member] | ||||
Notes payable from related parties | $ 250 | |||
Debt instrument, interest rate | 6.00% | |||
Interest payable | $ 0 | |||
Gain (loss) on cancellation of notes payable | $ 0 | |||
Former officer and employee [Member] | Notes Payable, Other Payables [Member] | ||||
Number of officers and employees | Number | 7 | |||
Notes payable from related parties | $ 488 | |||
Interest payable | 2 | |||
Notes payable outstanding | $ 152 | |||
Former officer and employee [Member] | Notes Payable, Other Payables [Member] | Minimum [Member] | ||||
Debt instrument, interest rate | 3.00% | |||
Former officer and employee [Member] | Notes Payable, Other Payables [Member] | Maximum [Member] | ||||
Debt instrument, interest rate | 6.00% |
CONVERTIBLE NOTE (Details)
CONVERTIBLE NOTE (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Convertible note | $ 250 | |
7% Two Convertible Notes [Member] | ||
Convertible note | $ 250 |
CONVERTIBLE NOTE (Details Narra
CONVERTIBLE NOTE (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | Jul. 28, 2017 | Jun. 28, 2017 | Apr. 17, 2017 | Jun. 30, 2017 | Jun. 02, 2017 | Apr. 26, 2017 | Apr. 05, 2017 | Feb. 28, 2017 | Dec. 31, 2016 | Oct. 21, 2016 |
Debt face amount | $ 400 | |||||||||
Warrant issued | 1,428,572 | 180,000 | 333,333 | 530,000 | ||||||
Exercise price of warrants (in dollars per share) | $ 0.84 | $ 0.90 | $ 0.70 | |||||||
Debt discount | $ 398 | $ 484 | ||||||||
7% Two Convertible Notes [Member] | ||||||||||
Conversion of shares outstanding | 189,091 | |||||||||
Accrued interest on debt | 4 | |||||||||
Beneficial conversion feature | $ 31 | |||||||||
Debt face amount | $ 250 | $ 104 | ||||||||
Interest rate | 7.00% | |||||||||
Warrant issued | 166,668 | 160,000 | ||||||||
Exercise price of warrants (in dollars per share) | $ 0.90 | $ 0.80 | ||||||||
Debt discount | $ 61 | |||||||||
Conversion price (in dollars per share) | $ 0.75 | |||||||||
7% Two Convertible Notes [Member] | Warrant [Member] | ||||||||||
Beneficial conversion feature | $ 61 | |||||||||
Other Convertible Notes Payable [Member] | ||||||||||
Conversion of shares outstanding | 189,091 | |||||||||
Accrued interest on debt | $ 1 | |||||||||
Beneficial conversion feature | $ 26 | |||||||||
Debt face amount | $ 104 | |||||||||
Warrant term | 5 years | |||||||||
Warrant issued | 160,000 | |||||||||
Exercise price of warrants (in dollars per share) | $ 0.80 | |||||||||
Debt discount | $ 25 |
CONVERTIBLE NOTE - RELATED PART
CONVERTIBLE NOTE - RELATED PARTY (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Unamortized debt discounts | $ (398) | $ (484) |
Unamortized financing cost | (10) | (12) |
Total Convertible note - related party | 122 | 34 |
12% Convertible secured note [Member] | ||
12% Convertible secured note | $ 530 | $ 530 |
CONVERTIBLE NOTE - RELATED PA60
CONVERTIBLE NOTE - RELATED PARTY (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | Oct. 21, 2016 | Jun. 30, 2017 | Jun. 30, 2017 | Jun. 02, 2017 | Apr. 05, 2017 | Feb. 28, 2017 | Dec. 31, 2016 |
Debt face amount | $ 400 | ||||||
Warrant term | 4 years 5 months 1 day | ||||||
Number of warrants | 530,000 | 1,428,572 | 180,000 | 333,333 | |||
Exercise price of warrants (in dollars per share) | $ 0.84 | $ 0.84 | $ 0.90 | $ 0.70 | |||
Debt interest expense | $ 44 | $ 44 | |||||
Interest payable | $ 16 | $ 16 | $ 12 | ||||
12% Convertible secured note [Member] | |||||||
Interest rate | 12.00% | ||||||
Debt face amount | $ 530 | ||||||
Original debt discount | 30 | ||||||
Proceeds from convertible debt | $ 500 | ||||||
Conversion price (in dollars per share) | $ 0.55 | ||||||
Debt instrument minimum share price | 3 | ||||||
Warrant, force redemption price | $ 0.001 | ||||||
Beneficiary conversion feature | $ 329 | ||||||
Debt discount | 518 | ||||||
Debt discount, warrant | 159 | ||||||
Debt issuance costs, gross | $ 13 | ||||||
12% Convertible secured note [Member] | Warrant One [Member] | |||||||
Warrant term | 3 years | ||||||
Number of warrants | 265,000 | ||||||
Exercise price of warrants (in dollars per share) | $ 0.80 | ||||||
12% Convertible secured note [Member] | Warrant Two [Member] | |||||||
Warrant term | 3 years | ||||||
Number of warrants | 265,000 | ||||||
Exercise price of warrants (in dollars per share) | $ 0.90 |
STOCKHOLDERS' EQUITY (Details N
STOCKHOLDERS' EQUITY (Details Narrative) $ / shares in Units, $ in Thousands | Jun. 28, 2017USD ($)$ / sharesshares | Jun. 19, 2017Investor$ / sharesshares | May 05, 2017shares | Apr. 05, 2017USD ($)$ / sharesshares | Mar. 28, 2017USD ($)$ / sharesshares | Mar. 24, 2017shares | Mar. 15, 2017USD ($)$ / sharesshares | Mar. 09, 2017USD ($)$ / sharesshares | Mar. 08, 2017USD ($)$ / sharesshares | Feb. 23, 2017USD ($)$ / sharesshares | Nov. 15, 2016USD ($)$ / sharesshares | Nov. 03, 2016USD ($)$ / sharesshares | Jun. 18, 2017USD ($)$ / sharesshares | Jun. 02, 2017USD ($)$ / sharesshares | Jun. 30, 2017USD ($)$ / sharesshares | Jun. 30, 2016USD ($) | Feb. 28, 2017$ / sharesshares | Dec. 31, 2016USD ($)$ / sharesshares | Oct. 21, 2016shares |
Preferred stock, authorized | 151,224 | 151,224 | |||||||||||||||||
Stock issued during period, shares, new issues | 189,091 | 500,000 | |||||||||||||||||
Warrant issued | 180,000 | 1,428,572 | 333,333 | 530,000 | |||||||||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 0.90 | $ 0.84 | $ 0.70 | ||||||||||||||||
Warrant term | 4 years 5 months 1 day | ||||||||||||||||||
Cancellation of convertible securities, number of securities called by convertible securities | 360,002 | 666,667 | |||||||||||||||||
Cancellation of convertible securities, exercise price of convertible securities | $ / shares | $ 0.75 | $ 0.60 | |||||||||||||||||
Debt conversion, original debt, amount | $ | $ 270 | $ 400 | |||||||||||||||||
Sale of stock, price per share | $ / shares | $ 0.55 | $ 0.60 | |||||||||||||||||
Proceeds from issuance of common stock | $ | $ 104 | $ 300 | |||||||||||||||||
Preferred stock value per share | $ / shares | $ 0 | $ 0 | |||||||||||||||||
Preferred stock, issued | 0 | 0 | |||||||||||||||||
Preferred stock, outstanding | 0 | 0 | |||||||||||||||||
Convertible Securities issued | 100,001 | ||||||||||||||||||
Value of convertible securities per share | $ | $ 55 | $ 625 | |||||||||||||||||
Total notes payable | $ | $ 569 | ||||||||||||||||||
Demand Promissory Notes [Member] | |||||||||||||||||||
Warrant issued | 180,002 | ||||||||||||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 0.90 | ||||||||||||||||||
Cancellation of convertible securities, number of securities called by convertible securities | 666,667 | ||||||||||||||||||
Cancellation of convertible securities, exercise price of convertible securities | $ / shares | $ 0.60 | ||||||||||||||||||
Debt conversion, original debt, amount | $ | $ 400 | $ 400,000 | |||||||||||||||||
Subscription Agreement [Member] | |||||||||||||||||||
Warrant issued | 901,666 | ||||||||||||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 0.80 | ||||||||||||||||||
Stock and warrants issued during period, shares | 901,666 | ||||||||||||||||||
Shares issued, price per share | $ / shares | $ 0.60 | ||||||||||||||||||
Stock and warrants issued during period, value | $ | $ 541 | ||||||||||||||||||
Subscription agreement, participate, trigger amount | $ | $ 100,000 | ||||||||||||||||||
Warrant term | 3 years | ||||||||||||||||||
Consultant [Member] | |||||||||||||||||||
Shares issued, price per share | $ / shares | $ 0.80 | ||||||||||||||||||
Stock issued for services | 12,549 | 956,153 | |||||||||||||||||
Stock value issued for services | $ | $ 10 | $ 498 | |||||||||||||||||
Sale of stock, price per share | $ / shares | $ 0.80 | $ 0.52 | |||||||||||||||||
Chief Executive Officer [Member] | |||||||||||||||||||
Warrant issued | 317,460 | ||||||||||||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 0.01 | ||||||||||||||||||
Warrants and rights outstanding | $ | $ 188,000 | ||||||||||||||||||
Warrant term | 10 years | ||||||||||||||||||
Affiliate of Philou [Member] | |||||||||||||||||||
Debt instrument, amount cancelled | $ | $ 250,000 | ||||||||||||||||||
Warrant issued | 1,428,572 | ||||||||||||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 0.70 | ||||||||||||||||||
Warrants and rights outstanding | $ | $ 401 | ||||||||||||||||||
Series B Preferred Stock [Member] | |||||||||||||||||||
Preferred stock, authorized | 500,000 | ||||||||||||||||||
Temporary equity, shares issued | 100,000 | 100,000 | |||||||||||||||||
Temporary equity, stated value per share | $ / shares | $ 10 | $ 10 | |||||||||||||||||
Temporary equity outstanding | 100,000 | 0 | |||||||||||||||||
Series B Preferred Stock [Member] | Preferred Stock Purchase Agreement [Member] | |||||||||||||||||||
Temporary equity, stated value per share | $ / shares | $ 10 | ||||||||||||||||||
Series B Preferred Stock [Member] | Affiliate of Philou [Member] | |||||||||||||||||||
Convertible preferred stock, beneficial conversion feature | $ | $ 265 | ||||||||||||||||||
Series A Preferred Stock [Member] | |||||||||||||||||||
Preferred stock, authorized | 500,000 | ||||||||||||||||||
Temporary equity, shares issued | 0 | 0 | |||||||||||||||||
Temporary equity outstanding | 0 | 0 | |||||||||||||||||
Total Preferred and Convertible Preferred Stock [Member] | |||||||||||||||||||
Preferred stock, authorized | 2,000,000 | ||||||||||||||||||
Series C Preferred Stock [Member] | |||||||||||||||||||
Preferred stock, authorized | 460,000 | ||||||||||||||||||
Temporary equity, shares issued | 455,002 | 0 | |||||||||||||||||
Temporary equity, stated value per share | $ / shares | $ 2.40 | $ 2.40 | |||||||||||||||||
Temporary equity outstanding | 455,002 | 0 | |||||||||||||||||
Series C Preferred Stock [Member] | Subscription Agreement [Member] | |||||||||||||||||||
Dividend rate | $ / shares | $ 0.24 | ||||||||||||||||||
Warrant issued | 86,667 | ||||||||||||||||||
Stock and warrants issued during period, shares | 21,667 | ||||||||||||||||||
Number of investors | Investor | 20 | ||||||||||||||||||
Discription of preferred stock | Each share of Series C Preferred Stock has a stated value of $2.40 per share. Each share of Series C Preferred Stock may be convertible at the holder’s option into shares of Common Stock of the Company at a conversion price of $0.60 per share, which, currently, represents four shares of Common Stock. The conversion price is subject to standard anti-dilution provisions in connection with any stock split, stock dividend, subdivision or similar reclassification of the Common Stock. Each share of Series C Preferred stock is mandatorily converted into shares of Common Stock based on the then conversion price in effect in the event that the Company’s Common Stock closing price exceeds $1.20 per share for 20 consecutive trading days. As the effective conversion price of the Series C Convertible Preferred Stock on a converted basis was below the market price of the Company’s common stock on the date of issuance, it was determined that these discounts represent beneficial conversion features, which were valued at $371 and recognized as a deemed dividend, based on the difference between the effective conversion price and the market price of the Company’s common stock on the date of issuance. | ||||||||||||||||||
Series D Preferred Stock [Member] | |||||||||||||||||||
Preferred stock, authorized | 378,776 | ||||||||||||||||||
Temporary equity, shares issued | 378,776 | 0 | |||||||||||||||||
Temporary equity, stated value per share | $ / shares | $ 0.01 | $ 0.01 | |||||||||||||||||
Temporary equity outstanding | 378,776 | 0 | |||||||||||||||||
Series E Preferred Stock [Member] | |||||||||||||||||||
Preferred stock, authorized | 10,000 | ||||||||||||||||||
Temporary equity, shares issued | 10,000 | 0 | |||||||||||||||||
Temporary equity, stated value per share | $ / shares | $ 45 | $ 45 | |||||||||||||||||
Temporary equity outstanding | 10,000 | 0 | |||||||||||||||||
Philou [Member] | Series B Preferred Stock [Member] | |||||||||||||||||||
Stock issued during period, shares, new issues | 1,000,000 | ||||||||||||||||||
Philou [Member] | Series B Preferred Stock [Member] | Preferred Stock Purchase Agreement [Member] | |||||||||||||||||||
Stock purchase agreement, maximum investment | $ | $ 5,000 | ||||||||||||||||||
Stock purchase agreement, term | 3 years | ||||||||||||||||||
Temporary equity, redemption price per share | $ / shares | $ 0.70 | ||||||||||||||||||
Stock required to participate in financing agreements, minimum threshold | 100,000 | ||||||||||||||||||
Discription of preferred stock | Each share of Series B Preferred Stock shall have the right to receive dividends equal to one ten millionth (0.0000001) of earnings before interest, taxes, depreciation, amortization and stock-based compensation ( “EBITDAS” | ||||||||||||||||||
Philou Ventures, LLC [Member] | Series B Preferred Stock [Member] | |||||||||||||||||||
Stock issued during period, shares, new issues | 50,000 | 25,000 | 1,000,000 |
STOCKHOLDERS' EQUITY (Details62
STOCKHOLDERS' EQUITY (Details Narrative 1) - USD ($) $ in Thousands | Jun. 28, 2017 | Jun. 02, 2017 | Apr. 28, 2017 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Convertible Securities issued | 100,001 | ||||||
Value of convertible securities per share | $ 55 | $ 625 | |||||
Total notes payable | 569 | ||||||
8% Notes payable to Lucosky Brookman, LLP Due On November 25, 2017 [Member] | |||||||
Total notes payable | [1] | $ 450 | |||||
8% Notes payable to Lucosky Brookman, LLP Due On November 25, 2017 [Member] | Microphase Corporation [Member] | |||||||
Total notes payable | $ 450 | ||||||
Redeemable Convertible Series B Preferred Stock [Member] | 8% Notes payable to Lucosky Brookman, LLP Due On November 25, 2017 [Member] | Microphase Corporation [Member] | |||||||
Convertible Securities issued | 10,000 | ||||||
Value of convertible securities per share | $ 45 | ||||||
Warrant [Member] | |||||||
Number of shares issued | 1,000,000 | ||||||
Share Exchange Agreement [Member] | Series D Preferred Stock [Member] | |||||||
Number of shares issued | 378,776 | ||||||
Share Exchange Agreement [Member] | Series D Preferred Stock [Member] | Common Stock And Warrants [Member] | |||||||
Number of shares converted | 757,552 | ||||||
Share Exchange Agreement [Member] | Common Stock [Member] | |||||||
Number of shares issued | 1,842,448 | ||||||
Share Exchange Agreement [Member] | Common Stock [Member] | Microphase Corporation [Member] | |||||||
Common stock, shares issued | 1,603,434 | ||||||
Common stock, shares outstanding | 1,603,434 | ||||||
[1] | On June 2, 2017, pursuant to the terms of the Share Exchange Agreement and in consideration of legal services, Microphase issued a $450 8% promissory note with a maturity date of November 25, 2017 to Lucosky Brookman, LLP (the "Lucosky Note"). In conjunction with the issuance of the Lucosky Note, the Company issued Lucosky Brookman 10,000 shares of redeemable convertible Series E preferred stock (the "Series E Preferred Stock") with a stated value of $45 per share as an alternative to providing a guarantee for the amount of the Lucosky Note. The Company, at its option, may redeem for cash, in whole or in part, at any time and from time to time, the shares of Series E Preferred Stock at the time outstanding, upon written notice to the holder of the shares, at a cash redemption price equal to $45 multiplied by the number of shares being redeemed. Any such optional redemption by the Company shall be credited against the Lucosky Note. During the period June 3, 2017 to June 30, 2017, Microphase incurred $3 of interest on the Lucosky Note. As of June 30, 2017, accrued interest on the Lucosky Note was $3. |
RELATED PARTY TRANSACTION (Deta
RELATED PARTY TRANSACTION (Details Narrative) $ / shares in Units, $ in Thousands | Jun. 28, 2017shares | Apr. 05, 2017$ / sharesshares | Mar. 15, 2017shares | Mar. 03, 2017USD ($)$ / sharesshares | Dec. 29, 2016USD ($) | Oct. 26, 2016USD ($)shares | Oct. 24, 2016USD ($) | Oct. 21, 2016USD ($)$ / sharesshares | Mar. 25, 2017USD ($) | Mar. 24, 2017shares | Jun. 30, 2017USD ($)AgreementInvestor$ / sharesshares | Mar. 31, 2017USD ($) | Dec. 31, 2016USD ($)shares | Jun. 30, 2017USD ($)AgreementInvestor$ / sharesshares | Jun. 02, 2017$ / sharesshares | Feb. 28, 2017USD ($)Investor$ / sharesshares | Feb. 22, 2017USD ($) |
Face amount of debt instrument | $ 400 | ||||||||||||||||
Interest expense | $ 44 | $ 44 | |||||||||||||||
Number of shares issued | shares | 189,091 | 500,000 | |||||||||||||||
Warrant issued | shares | 180,000 | 530,000 | 1,428,572 | 333,333 | |||||||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 0.90 | $ 0.84 | $ 0.84 | $ 0.70 | |||||||||||||
MCKEA Short-term Loan [Member] | |||||||||||||||||
Interest expense | $ 3 | ||||||||||||||||
Proceeds from short-term debt | $ 250 | ||||||||||||||||
Cancellation of short-term borrowings | $ 250 | ||||||||||||||||
The Consultant Mr. Ault [Member] | |||||||||||||||||
Compensation expenses | 90 | ||||||||||||||||
Series B Preferred Stock [Member] | MCKEA Short-term Loan [Member] | |||||||||||||||||
Number of shares issued | shares | 25,000 | ||||||||||||||||
Share Exchange Agreement [Member] | |||||||||||||||||
Warrant issued | shares | 1,000,000 | ||||||||||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 1.10 | ||||||||||||||||
Common Stock [Member] | |||||||||||||||||
Number of shares issued | shares | 360,000 | ||||||||||||||||
Warrant issued | shares | 180,000 | ||||||||||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 0.90 | ||||||||||||||||
Share price (in dollars per share) | $ / shares | $ 0.75 | ||||||||||||||||
12% Convertible Promissory Notes [Member] | |||||||||||||||||
Face amount of debt instrument | $ 530 | ||||||||||||||||
Conversion price of debt instrument | $ / shares | $ 0.55 | ||||||||||||||||
Interest expense | 32 | ||||||||||||||||
12% Convertible Promissory Notes [Member] | Warrant [Member] | Barry Blank Living Trust [Member] | |||||||||||||||||
Face amount of debt instrument | $ 500 | ||||||||||||||||
Maturity date | Oct. 20, 2019 | ||||||||||||||||
Avalanche International Corp. [Member] | |||||||||||||||||
Principal amount | $ 1,500 | ||||||||||||||||
Value of equity shares available for sale | $ 7 | $ 85 | $ 7 | ||||||||||||||
Avalanche International Corp. [Member] | MTIX [Member] | |||||||||||||||||
Payments to acquire businesses, gross | $ 50 | $ 50 | |||||||||||||||
Avalanche International Corp. [Member] | MTIX [Member] | Series B Preferred Stock [Member] | |||||||||||||||||
Number of shares issued for acquisition | shares | 100,000 | ||||||||||||||||
Avalanche International Corp. [Member] | Common Stock [Member] | |||||||||||||||||
Number of equity shares available for sale | shares | 17,080 | 250,900 | 17,080 | ||||||||||||||
Weighted average number of shares outstanding, diluted | shares | 52,000,000 | ||||||||||||||||
Avalanche International Corp. [Member] | Common Stock [Member] | Series B Preferred Stock [Member] | |||||||||||||||||
Conversion price of debt instrument | $ / shares | $ 0.50 | ||||||||||||||||
Avalanche International Corp. [Member] | Common Stock [Member] | MTIX [Member] | |||||||||||||||||
Conversion price of debt instrument | $ / shares | $ 0.50 | ||||||||||||||||
Number of shares called by options | shares | 531,919 | ||||||||||||||||
Avalanche International Corp. [Member] | Notes Receivable [Member] | |||||||||||||||||
Conversion ratio | 0.74536 | 0.74536 | |||||||||||||||
Number of shares issuable | shares | 2,113,086 | 2,113,086 | |||||||||||||||
Financing receivable, discount | $ 123 | $ 123 | |||||||||||||||
Payments to Acquire Notes Receivable | $ 950 | $ 1,520 | |||||||||||||||
Avalanche International Corp. [Member] | Excess Funding of Note Receivable [Member] | |||||||||||||||||
Interest rate | 12.00% | 12.00% | |||||||||||||||
Principal amount | $ 970 | $ 970 | |||||||||||||||
Financing receivable, discount rate | 5.00% | 5.00% | |||||||||||||||
Financing receivable, discount | $ 970 | $ 970 | |||||||||||||||
Avalanche International Corp. [Member] | 12% Convertible Promissory Notes [Member] | |||||||||||||||||
Number of agreement | Agreement | 3 | 3 | |||||||||||||||
Interest rate | 12.00% | 12.00% | |||||||||||||||
Principal amount | $ 525 | $ 525 | |||||||||||||||
Conversion ratio | 0.74536 | 0.74536 | |||||||||||||||
Avalanche International Corp. [Member] | 12% Convertible Promissory Notes [Member] | Notes Receivable [Member] | Common Stock [Member] | |||||||||||||||||
Number of shares issuable | shares | 2,113,086 | 2,113,086 | |||||||||||||||
Avalanche International Corp. [Member] | Convertible Notes [Member] | MTIX [Member] | Share Exchange Agreement [Member] | |||||||||||||||||
Payments to acquire businesses, gross | $ 500 | ||||||||||||||||
Debt instrument, interest rate | 7.00% | ||||||||||||||||
Face amount of debt instrument | $ 9,500 | ||||||||||||||||
MTIX [Member] | MLSE Plasma-Laser System [Member] | |||||||||||||||||
Term of long-term purchase commitment | 3 years | ||||||||||||||||
Value of long-term purchase commitment | $ 50,000,000 | ||||||||||||||||
Accredited Investor [Member] | |||||||||||||||||
Debt instrument, interest rate | 6.00% | ||||||||||||||||
Face amount of debt instrument | $ 140 | $ 140 | $ 400 | ||||||||||||||
Number of investors | Investor | 4 | 4 | 8 | ||||||||||||||
Warrant issued | shares | 224,371 | 224,371 | |||||||||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 0.77 | $ 0.77 | |||||||||||||||
Amount of warrants outstanding | $ 88,462 | $ 88,462 | |||||||||||||||
Share price (in dollars per share) | $ / shares | $ 0.80 | $ 0.80 |
RELATED PARTY TRANSACTION (De64
RELATED PARTY TRANSACTION (Details Narrative 1) - USD ($) $ / shares in Units, $ in Thousands | Jun. 28, 2017 | Apr. 05, 2017 | Mar. 15, 2017 | Mar. 09, 2017 | Jun. 02, 2017 | Jul. 02, 2017 | Dec. 31, 2017 | Jun. 30, 2017 | Mar. 21, 2017 | Dec. 31, 2016 |
Sale of Stock, Price Per Share | $ 0.55 | $ 0.60 | ||||||||
Proceeds from issuance of common stock | $ 104 | $ 300 | ||||||||
Notes payable from related parties | $ 278 | |||||||||
Number of shares issued | 189,091 | 500,000 | ||||||||
JLA Realty [Member] | ||||||||||
Notes payable from related parties | $ 250 | |||||||||
Common Stock [Member] | ||||||||||
Number of shares issued | 360,000 | |||||||||
Subscription Agreement [Member] | Common Stock [Member] | ||||||||||
Sale of Stock, Price Per Share | $ 0.60 | |||||||||
Proceeds from issuance of common stock | $ 300 | |||||||||
Number of shares issued | 500,000 | |||||||||
Philou [Member] | JLA Realty [Member] | ||||||||||
Number of shares owned | 666,667 | |||||||||
Ownership percentage | 7.50% | |||||||||
Philou [Member] | Series B Preferred Stock [Member] | ||||||||||
Number of shares issued | 1,000,000 | |||||||||
Preferred Stock Purchase Agreement [Member] | Philou [Member] | Series B Preferred Stock [Member] | ||||||||||
Stock Purchase Agreement, Maximum Investment | $ 5,000 | |||||||||
Term of stock purchase agreement | 3 years | |||||||||
Preferred Stock Purchase Agreement [Member] | Philou [Member] | Series B Preferred Stock [Member] | Subsequent Event [Member] | ||||||||||
Number of shares issued | 100,000 |
SEGMENT, CUSTOMERS AND GEOGRAPH
SEGMENT, CUSTOMERS AND GEOGRAPHICAL INFORMATION (Details Narrative) | 6 Months Ended |
Jun. 30, 2017Segment | |
Segment Reporting [Abstract] | |
Number of Reportable Segments | 2 |
SEGMENT, CUSTOMERS AND GEOGRA66
SEGMENT, CUSTOMERS AND GEOGRAPHICAL INFORMATION (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Revenues | $ 1,822 | $ 2,064 | $ 3,450 | $ 3,777 | |
Inter-segment revenues | |||||
Total revenues | 1,822 | 2,064 | 3,450 | 3,777 | |
Depreciation and amortization expense | 47 | 43 | 80 | 83 | |
Operating income (loss) | (1,444) | 11 | (2,231) | (189) | |
Other income, net | 55 | (614) | |||
Interest income, net | 62 | ||||
Interest expense, net | (407) | ||||
Net loss attributable to non-controlling interest | (112) | (112) | |||
Net income (loss) | (1,739) | 66 | (2,733) | (127) | |
Capital expenditures for segment assets | 19 | 3 | 21 | 74 | |
Identifiable assets | 13,981 | 4,564 | 13,981 | 4,564 | $ 5,472 |
Operating Segments [Member] | DPC [Member] | |||||
Revenues | 1,316 | 1,212 | 2,329 | 2,160 | |
Inter-segment revenues | 12 | 6 | 37 | 62 | |
Total revenues | 1,328 | 1,268 | 2,366 | 2,222 | |
Depreciation and amortization expense | 19 | 38 | |||
Operating income (loss) | (1,396) | 33 | (2,140) | (181) | |
Capital expenditures for segment assets | 8 | 8 | 23 | ||
Identifiable assets | 12,315 | 2,157 | 12,315 | 2,157 | |
Operating Segments [Member] | DPL [Member] | |||||
Revenues | 506 | 852 | 1,121 | 1,617 | |
Inter-segment revenues | |||||
Total revenues | 506 | 852 | 1,121 | 1,617 | |
Depreciation and amortization expense | 20 | 24 | 37 | 45 | |
Operating income (loss) | (48) | (22) | (91) | (8) | |
Capital expenditures for segment assets | 11 | 3 | 13 | 51 | |
Identifiable assets | 1,666 | 2,407 | 1,666 | 2,407 | |
Intersegment Eliminations [Member] | |||||
Revenues | |||||
Inter-segment revenues | (12) | (56) | (37) | (62) | |
Total revenues | (12) | (56) | (37) | (62) | |
Depreciation and amortization expense | |||||
Operating income (loss) | |||||
Capital expenditures for segment assets | |||||
Identifiable assets | |||||
Intersegment Eliminations [Member] | DPC [Member] | |||||
Revenues | |||||
Depreciation and amortization expense | $ 27 | $ 43 |
SEGMENT, CUSTOMERS AND GEOGRA67
SEGMENT, CUSTOMERS AND GEOGRAPHICAL INFORMATION (Details 1) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Revenues | $ 1,822 | $ 2,064 | $ 3,450 | $ 3,777 |
Sales Revenue, Net [Member] | Customer Concentration Risk [Member] | Customer A [Member] | ||||
Revenues | $ 320 | $ 443 | $ 629 | $ 768 |
Percentage of Total Company Revenues | 19.00% | 21.00% | 18.00% | 20.00% |
Sales Revenue, Net [Member] | Customer Concentration Risk [Member] | Customer B [Member] | ||||
Revenues | $ 287 | |||
Percentage of Total Company Revenues | 14.00% |
SEGMENT, CUSTOMERS AND GEOGRA68
SEGMENT, CUSTOMERS AND GEOGRAPHICAL INFORMATION (Details 2) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Revenues | $ 1,822 | $ 2,064 | $ 3,450 | $ 3,777 |
Commercial Products [Member] | ||||
Revenues | 1,083 | 1,413 | 2,023 | 2,460 |
Defense Products [Member] | ||||
Revenues | $ 739 | $ 651 | $ 1,427 | $ 1,317 |
SEGMENT, CUSTOMERS AND GEOGRA69
SEGMENT, CUSTOMERS AND GEOGRAPHICAL INFORMATION (Details 3) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Revenues | $ 1,822 | $ 2,064 | $ 3,450 | $ 3,777 |
North America [Member] | ||||
Revenues | 1,184 | 1,287 | 2,180 | 2,226 |
Europe [Member] | ||||
Revenues | 386 | 490 | 901 | 1,244 |
South Korea [Member] | ||||
Revenues | 116 | $ 287 | 219 | 297 |
Other Countries [Member] | ||||
Revenues | $ 136 | $ 150 | $ 10 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - USD ($) | Aug. 10, 2017 | Jul. 28, 2017 | Jul. 24, 2017 | Jul. 06, 2017 | Jun. 28, 2017 | Apr. 05, 2017 | Mar. 15, 2017 | Jun. 30, 2017 | Jun. 02, 2017 | Apr. 26, 2017 | Apr. 17, 2017 | Feb. 28, 2017 | Oct. 21, 2016 |
Number of shares issued | 189,091 | 500,000 | |||||||||||
Share price | $ 0.72 | ||||||||||||
Exercise price of warrants (in dollars per share) | $ 0.90 | $ 0.84 | $ 0.70 | ||||||||||
Warrant issued | 180,000 | 1,428,572 | 333,333 | 530,000 | |||||||||
7% Two Convertible Notes [Member] | |||||||||||||
Exercise price of warrants (in dollars per share) | $ 0.80 | $ 0.90 | |||||||||||
Warrant issued | 160,000 | 166,668 | |||||||||||
Common Stock [Member] | |||||||||||||
Number of shares issued | 360,000 | ||||||||||||
Exercise price of warrants (in dollars per share) | $ 0.90 | ||||||||||||
Warrant issued | 180,000 | ||||||||||||
Share Exchange Agreement [Member] | |||||||||||||
Exercise price of warrants (in dollars per share) | $ 1.10 | ||||||||||||
Warrant issued | 1,000,000 | ||||||||||||
Subsequent Event [Member] | TVT Capital LLC [Member] | Common Stock [Member] | Private Placement [Member] | |||||||||||||
Number of shares issued | 163,636 | ||||||||||||
Exercise price of warrants (in dollars per share) | $ 0.55 | ||||||||||||
Proceeds from private placement | $ 335,250,000 | ||||||||||||
Repayment of convertible note | $ 125,000,000 | ||||||||||||
Subsequent Event [Member] | Institutional Investor [Member] | Common Stock [Member] | Private Placement [Member] | |||||||||||||
Number of shares issued | 63,600 | ||||||||||||
Share price | $ 0.55 | ||||||||||||
Value of shares issued | $ 35,000,000 | ||||||||||||
Subsequent Event [Member] | Institutional Investor [Member] | Warrant [Member] | Private Placement [Member] | |||||||||||||
Number of shares issued | 120,000 | ||||||||||||
Share price | $ 0.55 | ||||||||||||
Subsequent Event [Member] | Purchase and Sale Agreement [Member] | TVT Capital LLC [Member] | |||||||||||||
Cost of future receipts | $ 1,091,220,000 | ||||||||||||
Aggregate Value of future receipts | 780,000,000 | ||||||||||||
Initial daily amount to pay | $ 5,456,500 | ||||||||||||
Description of initial daily amount to pay | The product of the Company’s average monthly sales times 15% divided by the average business days in a calendar month until the $1,091,220 has been paid in full. | ||||||||||||
Subsequent Event [Member] | Securities Purchase Agreement [Member] | Six Investors [Member] | Common Stock [Member] | |||||||||||||
Number of shares issued | 851,363 | ||||||||||||
Share price | $ 0.55 | ||||||||||||
Value of shares issued | $ 468,250,000 | ||||||||||||
Subsequent Event [Member] | Securities Purchase Agreement [Member] | Six Investors [Member] | Common Stock [Member] | Consideration [Member] | |||||||||||||
Aggregate purchase price paid in cash | 345,250,000 | ||||||||||||
Aggregate purchase price paid in consideration | $ 123,000,000 | ||||||||||||
Subsequent Event [Member] | Securities Purchase Agreement [Member] | Institutional Investor [Member] | |||||||||||||
Maturity date | Feb. 10, 2018 | ||||||||||||
Subsequent Event [Member] | Share Exchange Agreement [Member] | Institutional Investor [Member] | 7% Two Convertible Notes [Member] | |||||||||||||
Share price | $ 0.75 | ||||||||||||
Principal amount | $ 125,000,000 | ||||||||||||
Maturity date | Jun. 2, 2017 | ||||||||||||
Subsequent Event [Member] | Share Exchange Agreement [Member] | Institutional Investor [Member] | Warrant [Member] | 7% Two Convertible Notes [Member] | |||||||||||||
Exercise price of warrants (in dollars per share) | $ 0.90 | ||||||||||||
Warrant issued | 83,334 | ||||||||||||
Description of agreement | (i) the Convertible Note for three new promissory notes in the principal amounts of $110,000 due August 1, 2017; $35,000 due August 1, 2017; and $34,000 due August 8, 2017 (individually an Exchange Note and collectively the Exchange Notes) and (ii) the Prior Warrant for a new Warrant (“ Exchange Warrant”) to purchase 83,334 shares of common stock at $0.55 per share. |
SUBSEQUENT EVENTS (Details Na71
SUBSEQUENT EVENTS (Details Narrative 1) - USD ($) $ / shares in Units, $ in Thousands | Aug. 10, 2017 | Aug. 03, 2017 | Jul. 28, 2017 | Jun. 28, 2017 | Apr. 05, 2017 | Mar. 15, 2017 | Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Feb. 28, 2017 |
Number of shares issued | 189,091 | 500,000 | |||||||||
Share price | $ 0.72 | $ 0.72 | |||||||||
Exercise price of warrants (in dollars per share) | $ 0.90 | $ 0.84 | $ 0.84 | $ 0.70 | |||||||
Revenues | $ 1,822 | $ 2,064 | $ 3,450 | $ 3,777 | |||||||
Common Stock [Member] | |||||||||||
Number of shares issued | 360,000 | ||||||||||
Exercise price of warrants (in dollars per share) | $ 0.90 | ||||||||||
Subsequent Event [Member] | Coolisys Technologies, Inc [Member] | Power-Plus Technical Distributors [Member] | |||||||||||
Purchase price | $ 850,000 | ||||||||||
Description of payment for purchase price | (i) the assumption of loans (or pay off of such loans) in the approximate amount of $198,000; (ii) a two year promissory note in the amount of $255,000 payable in 24 monthly installments; and (iii) cash at closing of approximately $397,000. | ||||||||||
Subsequent Event [Member] | 12% Convertible Promissory Notes [Member] | |||||||||||
Exercise price of warrants (in dollars per share) | $ 0.55 | ||||||||||
Principal amount | $ 400,000 | ||||||||||
Proceeds from convertible debt | $ 360,000 | ||||||||||
Maturity date | Aug. 13, 2018 | ||||||||||
Subsequent Event [Member] | 10% Senior Convertible Promissory Notes [Member] | |||||||||||
Share price | $ 0.60 | ||||||||||
Principal amount | $ 880,000 | ||||||||||
Subsequent Event [Member] | Warrant [Member] | 10% Senior Convertible Promissory Notes [Member] | |||||||||||
Number of shares issued | 1,466,667 | ||||||||||
Share price | $ 0.60 | ||||||||||
Exercise price of warrants (in dollars per share) | $ 0.66 | ||||||||||
Subsequent Event [Member] | Institutional Investor [Member] | Private Placement [Member] | Common Stock [Member] | |||||||||||
Number of shares issued | 63,600 | ||||||||||
Share price | $ 0.55 | ||||||||||
Value of shares issued | $ 35,000 | ||||||||||
Subsequent Event [Member] | Institutional Investor [Member] | Private Placement [Member] | Warrant [Member] | |||||||||||
Number of shares issued | 120,000 | ||||||||||
Share price | $ 0.55 | ||||||||||
Subsequent Event [Member] | Registered Direct Offering [Member] | Institutional Investor [Member] | |||||||||||
Number of shares issued | 200,000 | ||||||||||
Share price | $ 0.55 | ||||||||||
Value of shares issued | $ 110,000 | ||||||||||
Subsequent Event [Member] | Securities Purchase Agreement [Member] | Coolisys Technologies, Inc [Member] | |||||||||||
Revenues | $ 2,200 | ||||||||||
Subsequent Event [Member] | Securities Purchase Agreement [Member] | Institutional Investor [Member] | |||||||||||
Maturity date | Feb. 10, 2018 | ||||||||||
Purchase price | $ 800,000 | ||||||||||
Subsequent Event [Member] | Securities Purchase Agreement [Member] | Accredited Investors [Member] | 12% Convertible Promissory Notes [Member] | |||||||||||
Number of shares issued | 666,666 | ||||||||||
Share price | $ 0.55 | ||||||||||
Subsequent Event [Member] | Securities Purchase Agreement [Member] | Accredited Investors [Member] | Warrant [Member] | |||||||||||
Number of shares issued | 666,666 | ||||||||||
Exercise price of warrants (in dollars per share) | $ 0.70 |