Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Mar. 31, 2015 | Jun. 30, 2014 | |
Document And Entity Information | |||
Entity Registrant Name | ENOVA SYSTEMS INC | ||
Entity Central Index Key | 922237 | ||
Document Type | 10-K | ||
Document Period End Date | 31-Dec-14 | ||
Amendment Flag | FALSE | ||
Current Fiscal Year End Date | -19 | ||
Is Entity a Well-known Seasoned Issuer? | No | ||
Is Entity a Voluntary Filer? | No | ||
Is Entity's Reporting Status Current? | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Public Float | $1,099,000 | ||
Entity Common Stock, Shares Outstanding | 64,520,195 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2014 |
BALANCE_SHEETS
BALANCE SHEETS (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
ASSETS | ||
Cash and cash equivalents | $1,000 | |
Accounts receivable, net | ||
Inventories and supplies, net | 368,000 | 427,000 |
Prepaid expenses and other current assets | 7,000 | 42,000 |
Total current assets | 375,000 | 470,000 |
Property and equipment, net | 80,000 | |
Total assets | 375,000 | 550,000 |
LIABILITIES AND STOCKHOLDERS' DEFICIT | ||
Accounts payable | 560,000 | 642,000 |
Loans from employees | 55,000 | 36,000 |
Deferred revenues | 213,000 | 213,000 |
Accrued payroll and related expenses | 211,000 | 194,000 |
Accrued loss for litigation settlement | 2,014,000 | 2,014,000 |
Other accrued liabilities | 431,000 | 294,000 |
Current portion of notes payable | 40,000 | 40,000 |
Total current liabilities | 3,524,000 | 3,433,000 |
Accrued interest payable | 1,482,000 | 1,401,000 |
Notes payable, net of current portion | 1,238,000 | 1,238,000 |
Total liabilities | 6,244,000 | 6,072,000 |
Stockholders' deficit: | ||
Common stock to be issued | 553,000 | 528,000 |
Common stock to be issued: Common Stock - no par value, 750,000,000 shares authorized; 64,520,000 and 44,520,000 shares issued and outstanding as of December 31, 2014 and December 31, 2013 | 145,735,000 | 145,512,000 |
Additional paid-in capital | 9,619,000 | 9,595,000 |
Accumulated deficit | -162,870,000 | -162,251,000 |
Total stockholders' deficit | -5,869,000 | -5,522,000 |
Total liabilities and stockholders' deficit | 375,000 | 550,000 |
Series A Preferred Stock | ||
Stockholders' deficit: | ||
Preferred stock: Series A convertible preferred stock - no par value, 30,000,000 shares authorized; 0 shares issued and outstanding; liquidating preference at $0.60 per share as of December 31, 2014 and December 31, 2013; Series B convertible preferred stock - no par value, 5,000,000 shares authorized; 546,000 shares issued and outstanding; liquidating preference at $2 per share as of December 31, 2014 and December 31, 2013 | ||
Series B Preferred Stock | ||
Stockholders' deficit: | ||
Preferred stock: Series A convertible preferred stock - no par value, 30,000,000 shares authorized; 0 shares issued and outstanding; liquidating preference at $0.60 per share as of December 31, 2014 and December 31, 2013; Series B convertible preferred stock - no par value, 5,000,000 shares authorized; 546,000 shares issued and outstanding; liquidating preference at $2 per share as of December 31, 2014 and December 31, 2013 | $1,094,000 | $1,094,000 |
BALANCE_SHEETS_Parenthetical
BALANCE SHEETS (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Stockholders' equity: | ||
Common stock, par value | ||
Common stock, shares authorized | 750,000,000 | 750,000,000 |
Common stock, shares issued | 64,520,000 | 44,520,000 |
Common stock, shares outstanding | 64,520,000 | 44,520,000 |
Series A Preferred Stock | ||
Stockholders' equity: | ||
Convertible preferred stock , par value | ||
Convertible preferred stock , shares authorized | 30,000,000 | 30,000,000 |
Convertible preferred stock , shares issued | 0 | 0 |
Convertible preferred stock , shares outstanding | 0 | 0 |
Convertible preferred stock liquidating preference | $0.60 | $0.60 |
Series B Preferred Stock | ||
Stockholders' equity: | ||
Convertible preferred stock , par value | ||
Convertible preferred stock , shares authorized | 5,000,000 | 5,000,000 |
Convertible preferred stock , shares issued | 546,000 | 546,000 |
Convertible preferred stock , shares outstanding | 546,000 | 546,000 |
Convertible preferred stock liquidating preference | $2 | $2 |
STATEMENTS_OF_OPERATIONS
STATEMENTS OF OPERATIONS (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Income Statement [Abstract] | ||
Revenues | $426,000 | |
Cost of revenues | 60,000 | 2,078,000 |
Gross loss | -60,000 | -1,652,000 |
Operating expenses | ||
Selling, general & administrative | 404,000 | 1,081,000 |
Total operating expenses | 404,000 | 1,081,000 |
Operating loss | -464,000 | -2,733,000 |
Other income and (expense), net | ||
Loss on litigation | ||
Interest and other income (expense), net | -155,000 | -171,000 |
Total other income and (expense), net | -155,000 | -171,000 |
Net loss | ($619,000) | ($2,904,000) |
Basic and diluted loss per share | ($0.01) | ($0.07) |
Weighted average number of common shares outstanding | 60,137,000 | 44,520,000 |
STATEMENTS_OF_CASH_FLOWS
STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Cash flows from operating activities: | ||
Net loss | ($619,000) | ($2,904,000) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Bad debt expense | 108,000 | |
Inventory reserve expense | 59,000 | 1,660,000 |
Depreciation and amortization | 38,000 | 130,000 |
Loss on disposal of property and equipment | 29,000 | |
Loss on asset impairment | 74,000 | 34,000 |
Stock option expense | 24,000 | 16,000 |
(Increase) decrease in operating assets: | ||
Accounts receivable | 118,000 | |
Inventory and supplies | 116,000 | |
Prepaid expenses and other current assets | 3,000 | 166,000 |
Long term receivables | 20,000 | |
Increase (decrease) in operating liabilities: | ||
Accounts payable | -82,000 | 84,000 |
Deferred revenues | 95,000 | |
Accrued payroll and related expense | 17,000 | 96,000 |
Other accrued liabilities | 137,000 | 39,000 |
Accrued interest payable | 81,000 | 83,000 |
Net cash used in operating activities | -268,000 | -110,000 |
Cash flows from investing activities: | ||
Sale of certificate of deposit, restricted | ||
Proceeds from the sale of fixed assets | 29,000 | |
Purchases of property and equipment | ||
Net cash provided by investing activities | 29,000 | |
Cash flows from financing activities: | ||
Payment on notes payable | -11,000 | |
Proceeds from related party loans | 44,000 | 36,000 |
Net proceeds from the issuance of common stock | 223,000 | |
Net cash provided by (used in) financing activities | 267,000 | 25,000 |
Net (decrease) in cash and cash equivalents | -1,000 | -56,000 |
Cash and cash equivalents, beginning of period | 1,000 | 57,000 |
Cash and cash equivalents, end of period | 1,000 | |
Supplemental disclosure of cash flow information: | ||
Interest paid | 1,000 | |
Supplemental disclosure of non-cash investing and financing: | ||
Conversion of related party loans to common stock | 25,000 | |
Assets repossessed and notes payable relieved | $39,000 |
STATEMENTS_OF_STOCKHOLDERS_EQU
STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT) (USD $) | Series B Preferred Stock | Common Stock To Be Issued | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Total |
Beginning Balance, Amount at Dec. 31, 2012 | $1,094,000 | $528,000 | $145,512,000 | $9,579,000 | ($159,347,000) | $2,634,000 |
Beginning Balance, Shares at Dec. 31, 2012 | 546,000 | 59,000 | 44,520,000 | |||
Stock option expense | 16,000 | 16,000 | ||||
Net loss for the period | -2,904,000 | -2,904,000 | ||||
Ending Balance, Amount at Dec. 31, 2013 | 1,094,000 | 528,000 | 145,512,000 | 9,595,000 | -162,251,000 | -5,522,000 |
Ending Balance, Shares at Dec. 31, 2013 | 546,000 | 59,000 | 44,520,000 | |||
Issuance of common stock for cash, Shares | 1,250,000 | 20,000,000 | ||||
Issuance of common stock for cash, Amount | 25,000 | 223,000 | 248,000 | |||
Stock option expense | 24,000 | 24,000 | ||||
Net loss for the period | -619,000 | -619,000 | ||||
Ending Balance, Amount at Dec. 31, 2014 | $1,094,000 | $553,000 | $145,735,000 | $9,619,000 | ($162,870,000) | ($5,869,000) |
Ending Balance, Shares at Dec. 31, 2014 | 546,000 | 1,309,000 | 64,520,000 |
Description_of_Business
Description of Business | 12 Months Ended |
Dec. 31, 2014 | |
Notes to Financial Statements | |
Description of Business | General |
Enova Systems, Inc., (the "Company" or "Enova"), is a California corporation that develops, designs and produces drive systems and related components for electric, hybrid electric, and fuel cell systems for mobile applications. The Company retains development and manufacturing rights to many of the technologies created, whether such research and development is internally or externally funded. The Company sells drive systems and related components in the United States, Asia and Europe. | |
Liquidity | |
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company has sustained recurring losses and negative cash flows from operations. Management believes that the Company’s losses in recent years have primarily resulted from a combination of insufficient product and service revenue to support the Company’s skilled and diverse technical staff believed to be necessary to support exploitation of the Company’s technologies. Historically, the Company’s growth and working capital needs have been funded through a combination of private and public equity offerings, and debt financing. During 2014, the Company’s working capital needs have been funded primarily through a combination of an equity issuance and existing cash reserves. As of December 31, 2014, the Company had no cash and cash equivalents. At December 31, 2014, the Company had net working capital of negative $3,149,000 compared to negative $2,963,000 at December 31, 2013, representing a decrease of approximately $186,000. | |
Management manages costs in line with estimated total revenue. However, there can be no assurance that any revenue will be realized or that the Company will successfully implement its plans. Management implemented measures to conserve cash, including the reduction of over 90% of employee headcount in the second quarter of 2012, and stringent controls over administrative expenses. The Company will continue to conserve available cash by closely scrutinizing expenditures during 2014. The Company will need to raise additional capital to accomplish continue in business over the next year. The Company can make no assurance with respect to either the availability or terms of such financing and capital when it may be required. | |
Going Concern | |
The Company has experienced and continues to experience operating losses and negative cash flows from operations, as well as an ongoing requirement for substantial additional capital investment. At December 31, 2014, the Company had an accumulated deficit of approximately $162.9 million, working capital of approximately negative $3,149,000 and shareholders’ equity deficit of approximately $5.9 million. Over the past years, the Company has been funded through a combination of debt financing and private equity offerings. As of December 31, 2014, the Company had no cash and cash equivalents. | |
The Company will need to raise additional capital to pursue recovery of its business over the long term and is currently pursuing a variety of funding options. There can be no assurance as to the availability or terms upon which such financing and capital might be available. If the Company is not successful in its efforts to raise additional funds, the Company may have to cease its business operations. | |
In February 2014, the Company entered into Subscription Agreements with various offshore investors to sell approximately 19,999,998 common shares of newly issued shares at a price of 0.0075 pence (approximately US$0.01per share) to certain eligible offshore investors on the Alternative Investment Market of the London Stock Exchange (the "AIM Exchange") for GBP 150,000 (approximately US$248,000) in gross proceeds by a private subscription. The net proceeds from the offering were approximately US$223,000. The Company continues to pursue other options to raise additional capital fund continuing operations; however, there can be no assurance that we can successfully raise additional funds through the capital markets. | |
The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The accompanying financial statements do not include any adjustments relating to the recoverability of assets and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. | |
Judgment entered in Arens Controls Litigation | |
On December 12, 2012, a judgment was entered by the United States District Court Northern District of Illinois in favor of Arens Controls Company, L.L.C. in the amount of $2,014,169 regarding claims for two counts concerning i) anticipatory breach of contract by Enova for certain purchase orders that resulted in lost profit to Arens and ii) reimbursement for engineering and capital equipment costs incurred by Arens exclusively for the fulfillment of certain purchase orders received from Enova. | |
On September 24, 2013, Enova and Arens entered into a Settlement Agreement and Mutual Release (the "Settlement Agreement") to resolve the remaining issues between them. Under the terms of the Settlement Agreement, Enova filed on September 27, 2013 a motion to dismiss the pending appeal with prejudice and Arens agreed that, for a period of 120 calendar days from the date of the Settlement Agreement, Arens would not take any action to enforce the Judgment. Thereafter, Arens is entitled, without further notice, to enforce the Judgment against Enova or otherwise exercise all available procedures and remedies for collection of the full amount of the Judgment and Enova has agreed not to contest the validity of the Judgment. However, if Enova had paid to Arens $300,000 at any time during the 120 day period, then within 3 business days after Arens received confirmation of such payment, Arens agreed to file a satisfaction of judgment stating that the Judgment has been satisfied and completely release and forever discharge Enova from any and all claims for damages whatsoever that occurred prior to the date of the Settlement Agreement. In exchange for Arens's release, Enova agreed to completely release and forever discharge Arens from any and all claims for damages whatsoever that occurred prior to the date of the Settlement Agreement. The Company was not able to comply with the due date for such payment by January 22, 2014. Therefore, the judgment against the Company can be enforced without further notice. | |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Notes to Financial Statements | |||||||||
Summary of Significant Accounting Policies | |||||||||
Basis of Presentation | |||||||||
These financial statements have been prepared in accordance with accounting principles generally accepted in the United States. | |||||||||
Revenue Recognition | |||||||||
The Company manufactures proprietary products and other products based on design specifications provided by its customers. | |||||||||
The Company recognizes revenue only when all of the following criteria have been met: | |||||||||
• | Persuasive evidence of an arrangement exists; | ||||||||
• | Delivery has occurred or services have been rendered; | ||||||||
• | The fee for the arrangement is fixed or determinable; and | ||||||||
• | Collectability is reasonably assured. | ||||||||
Persuasive Evidence of an Arrangement — The Company documents all terms of an arrangement in a written contract signed by the customer prior to recognizing revenue. Receipt of a customer purchase order is the primary method of determining that persuasive evidence of an arrangement exists. | |||||||||
Delivery Has Occurred or Services Have Been Rendered — The Company performs all services or delivers all products prior to recognizing revenue. Professional consulting and engineering services are considered to be performed when the services are complete. Equipment is considered delivered upon delivery to a customer’s designated location. In certain instances, the customer elects to take title upon shipment. | |||||||||
The Fee for the Arrangement is Fixed or Determinable — Prior to recognizing revenue, a customer’s fee is either fixed or determinable under the terms of the written contract. Fees professional consulting services, engineering services and equipment sales are fixed under the terms of the written contract. The customer’s fee is negotiated at the outset of the arrangement and is not subject to refund or adjustment during the initial term of the arrangement. | |||||||||
Collectability is Reasonably Assured — The Company determines that collectability is reasonably assured prior to recognizing revenue. Collectability is assessed on a customer-by-customer basis based on criteria outlined by management. New customers are subject to a credit review process, which evaluates the customer’s financial position and ultimately its ability to pay. The Company does not enter into arrangements unless collectability is reasonably assured at the outset. Existing customers are subject to ongoing credit evaluations based on payment history and other factors. If it is determined during the arrangement that collectability is not reasonably assured, revenue is recognized on a cash basis. Amounts received upfront for engineering or development fees under multiple-element arrangements are deferred and recognized over the period of committed services or performance, if such arrangements require the Company to provide on-going services or performance. All amounts received under collaborative research agreements or research and development contracts are nonrefundable, regardless of the success of the underlying research. | |||||||||
Since some customer orders contain multiple items such as equipment and services which are delivered at varying times, the Company determines whether the delivered items can be considered separate units of accounting. Delivered items are considered separate units of accounting if delivered items have value to the customer on a standalone basis, there is objective and reliable evidence of the fair value of undelivered items, and if delivery of undelivered items is probable and substantially in the Company’s control. The recognition of revenue from milestone payments is over the remaining minimum period of performance obligation. As required, the Company evaluates its sales contract to ascertain whether multiple element agreements are present. | |||||||||
The Company recognizes engineering and construction contract revenues using the percentage-of-completion method, based primarily on contract costs incurred to date compared with total estimated contract costs. Customer-furnished materials, labor, and equipment, and in certain cases subcontractor materials, labor, and equipment, are included in revenues and cost of revenues when management believes that the company is responsible for the ultimate acceptability of the project. Contracts are segmented between types of services, such as engineering and construction, and accordingly, gross margin related to each activity is recognized as those separate services are rendered. Changes to total estimated contract costs or losses, if any, are recognized in the period in which they are determined. Claims against customers are recognized as revenue upon settlement. Revenues recognized in excess of amounts billed are classified as current assets under contract work-in-progress. Amounts billed to clients in excess of revenues recognized to date are classified as current liabilities under advance billings on contracts. Changes in project performance and conditions, estimated profitability, and final contract settlements may result in future revisions to engineering and development contract costs and revenue. | |||||||||
Deferred Revenues | |||||||||
The Company recognizes revenues as earned. Amounts billed in advance of the period in which service is rendered are recorded as a liability under deferred revenues. The Company has entered into several production and development contracts with customers. The Company has evaluated these contracts, ascertained the specific revenue generating activities of each contract, and established the units of accounting for each activity. Revenue on these units of accounting is not recognized until a) there is persuasive evidence of the existence of a contract, b) the service has been rendered and delivery has occurred, c) there is a fixed and determinable price, and d) collectability is reasonable assured. | |||||||||
Warranty Costs | |||||||||
The Company provides product warranties for specific product lines and accrues for estimated future warranty costs in the period in which revenue is recognized. Our products are generally warranted to be free of defects in materials and workmanship for a period of 12 to 24 months from the date of installation, subject to standard limitations for equipment that has been altered by other than Enova Systems personnel and equipment which has been subject to negligent use. Warranty provisions are based on past experience of product returns, number of units repaired and our historical warranty incidence over the past twenty-four month period. The warranty liability is evaluated on an ongoing basis for adequacy and may be adjusted as additional information regarding expected warranty costs becomes known. | |||||||||
Shipping and Handling Costs | |||||||||
The Company includes shipping and handling costs associated with inbound and outbound freight in costs of goods sold. | |||||||||
Cash and Cash Equivalents | |||||||||
Short-term, highly liquid investments with an original maturity of three months or less are considered cash equivalents. Certificates of deposits that have a penalty for early withdrawal are excluded from cash and cash equivalents. | |||||||||
Accounts Receivable and Allowance for Doubtful Accounts | |||||||||
Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in the Company’s existing accounts receivable; however, changes in circumstances relating to accounts receivable may result in a requirement for additional allowances in the future. Past due balances over 90 days and other higher risk amounts are reviewed individually for collectability. If the financial condition of the Company’s customers were to deteriorate resulting in an impairment of their ability to make payment, additional allowances may be required. In addition, the Company maintains a general reserve for all invoices by applying a percentage based on the age category. Account balances are charged against the allowance after all collection efforts have been exhausted and the potential for recovery is considered remote. As of December 31, 2014 and 2013, the Company maintained a reserve of $404,000 for doubtful accounts receivable. There was bad debt expense recorded of $0 and $108,000 in 2014 and 2013, respectively. | |||||||||
Inventory | |||||||||
Inventories and supplies are comprised of materials used in the design and development of electric, hybrid electric, and fuel cell drive systems, and other power and ongoing management and control components for production and ongoing development contracts, finished goods and work-in-progress, and is stated at the lower of cost or market utilizing the first-in, first-out (FIFO) cost flow assumption. The Company maintains a perpetual inventory system and continuously records the quantity on-hand and standard cost for each product, including purchased components, subassemblies and finished goods. The Company maintains the integrity of perpetual inventory records through periodic physical counts of quantities on hand. Finished goods are reported as inventories until the point of transfer to the customer. Generally, title transfer is documented in the terms of sale. | |||||||||
Inventory reserve | |||||||||
The Company maintains an allowance against inventory for the potential future obsolescence or excess inventory. A substantial decrease in expected demand for our products, or decreases in our selling prices could lead to excess or overvalued inventories and could require us to substantially increase our allowance for excess inventory. If future customer demand or market conditions are less favorable than our projections, additional inventory write-downs may be required and would be reflected in cost of revenues in the period the revision is made. | |||||||||
Property and Equipment | |||||||||
Property and equipment are stated at cost and depreciated over the estimated useful lives of the related assets, which range from three to seven years using the straight-line method for financial statement purposes. The Company uses other depreciation methods (generally, accelerated depreciation methods) for tax purposes where appropriate. Amortization of leasehold improvements is computed using the straight-line method over the shorter of the remaining lease term or the estimated useful lives of the improvements. | |||||||||
Repairs and maintenance are expensed as incurred. Expenditures that increase the value or productive capacity of assets are capitalized. When property and equipment are retired, sold, or otherwise disposed of, the asset’s cost and related accumulated depreciation are removed from the accounts and any gain or loss is included in operations. | |||||||||
Impairment of Long-Lived Assets | |||||||||
The Company reviews the carrying value of property and equipment for impairment whenever events and circumstances indicate that the carrying value of an asset may not be recoverable from the estimated future cash flows expected to result from its use and eventual disposition. In cases where undiscounted expected future cash flows are less than the carrying value, an impairment loss is recognized equal to an amount by which the carrying value exceeds the fair value of assets. The factors considered by management in performing this assessment include current operating results, trends, and prospects, as well as the effects of obsolescence, demand, competition, and other economic factors. Long-lived assets that management commits to sell or abandon are reported at the lower of carrying amount or fair value less cost to sell. | |||||||||
Fair Value of Financial Instruments | |||||||||
The carrying amount of financial instruments, including cash and cash equivalents, certificates of deposit, accounts receivable, accounts payable and other accrued liabilities, approximate fair value due to the short maturity of these instruments. The recorded values of notes payable and long-term debt approximate their fair values, as interest approximates market rates. | |||||||||
The Company defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. At December 31, 2014 and 2013, the Company had no financial assets or liabilities periodically re-measured at fair value. | |||||||||
Stock-Based Compensation | |||||||||
The Company measures and recognizes compensation expense for all share-based payment awards made to employees and directors, including employee stock options based on the estimated fair values at the date of grant. The compensation expense is recognized over the requisite service period. | |||||||||
The Company’s determination of estimated fair value of share-based awards utilizes the Black-Scholes option-pricing model. The Black-Scholes model is affected by the Company’s stock price as well as assumptions regarding certain highly complex and subjective variables. These variables include, but are not limited to the Company’s expected stock price volatility over the term of the awards as well as actual and projected employee stock options exercise behaviors. | |||||||||
The cash flows from the tax benefits resulting from tax deductions in excess of the compensation cost recognized for those options are to be classified as financing cash flows. Due to the Company’s loss position, there were no such tax benefits for the years ended December 31, 2014 and 2013. | |||||||||
The Company determines the fair value of the restricted stock awards utilizing the quoted market prices of the Company’s shares on the date they were granted. | |||||||||
Research and Development | |||||||||
Research development, and engineering costs are expensed in the period incurred. Costs of significantly altering existing technology are expensed as incurred. | |||||||||
Income Taxes | |||||||||
The Company accounts for income taxes under an asset and liability approach. This process involves calculating the temporary and permanent differences between the carrying amounts of the assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The temporary differences can result in deferred tax assets and liabilities, which would be recorded on the Company’s balance sheets. The Company must assess the likelihood that its deferred tax assets will be recovered from future taxable income and, to the extent the Company believes that recovery is not likely, the Company must establish a valuation allowance. Changes in the Company’s valuation allowance in a period are recorded through the income tax provision on the statements of operations. | |||||||||
Uncertainty in income taxes are recognized in the Company’s financial statements based on the recognition threshold and measurement attributes for financial statement disclosure of tax positions taken or expected to be taken on a tax return. The impact of an uncertain income tax position on the income tax return must be recognized at the largest amount that is more-likely-than-not to be sustained upon audit by the relevant taxing authority. An uncertain income tax position will not be recognized if it has less than a 50% likelihood of being sustained. During 2014 and 2013, the Company did not recognize any liability for unrecognized income tax benefits. | |||||||||
Loss Per Share | |||||||||
Basic loss per share is computed by dividing loss available to common stockholders by the weighted-average number of common shares outstanding. Diluted loss per share is computed similar to basic loss per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. Common equivalent shares are excluded from the computation if their effect is anti-dilutive. The Company’s common share equivalents consist of stock options, warrants and preferred stock. | |||||||||
The potential shares, which are excluded from the determination of basic and diluted net loss per share as their effect is anti-dilutive, are as follows: | |||||||||
Fiscal Years Ended December 31, | |||||||||
2014 | 2013 | ||||||||
Options to purchase common stock | 8,641,000 | 5,210,000 | |||||||
Warrants to purchase common stock | 11,250,000 | 11,250,000 | |||||||
Common shares to be issued | 1,309,000 | 59,000 | |||||||
Series B preferred shares conversion | 24,000 | 24,000 | |||||||
Potential equivalent shares excluded | 21,224,000 | 16,543,000 | |||||||
Commitments and Contingencies | |||||||||
Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur. The Company’s management and its legal counsel assess such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company’s legal counsel evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material, would be disclosed. | |||||||||
Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the nature of the guarantee would be disclosed. | |||||||||
Estimates | |||||||||
The preparation of financial statements in accordance with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. | |||||||||
Concentration of Credit Risk | |||||||||
Financial instruments which potentially subject the Company to concentrations of credit risk consist of cash and cash equivalents and accounts receivable. The Company places its cash and cash equivalents with high credit, quality financial institutions. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash and cash equivalents. With respect to accounts receivable, the Company assesses the financial strength of its customers and, as a consequence, believes that the receivable credit risk exposure is not limited. | |||||||||
Recent Accounting Pronouncements | |||||||||
Certain accounting standards that have been issued or proposed by the FASB or other standards-setting bodies are not expected to have a material impact on the Company’s financial position, results of operations and cash flows. | |||||||||
ln August 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2014-15, "Presentation of Financial Statements - Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern" ("ASU 2014-15"). ASU 2014-15 is intended to define management's responsibility to evaluate whether there is substantial doubt about an entity's ability to continue as a going concern and to provide related footnote disclosures. Specifically, ASU 2014-15 provides a definition of the term substantial doubt and requires an assessment for a period of one year after the date that the financial statements are issued (or available to be issued). lt also requires certain disclosures when substantial doubt is alleviated as a result of consideration of management's plans and requires an express statement and other disclosures when substantial doubt is not alleviated. The new standard will be effective for reporting periods beginning after December 15, 2016, with early adoption permitted. Management is currently evaluating the impact of the adoption of ASU 2014-14 on our financial statement disclosures. | |||||||||
On June 19, 2014, the FASB issued ASU No. 2014-12, Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period, which clarifies that entities should treat performance targets that can be met after the requisite service period of a share-based payment award as performance conditions that affect vesting. Under the ASU, an entity would not record compensation expense related to an award for which transfer to the employee is contingent on the entity's satisfaction of a performance target until it becomes probable that the performance target will be met. The adoption of this ASU will be required, either on a retrospective basis or prospective basis, beginning with our Quarterly Report on Form 10-Q for the quarter ending March 31, 2016. The adoption of this ASU is not expected to have a material impact on our consolidated financial statements. |
Inventory
Inventory | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Notes to Financial Statements | |||||||||
Inventory | Inventories, consisting of materials, labor, and manufacturing overhead, are stated at the lower of cost (first-in, first-out) or market and consist of the following at December 31: | ||||||||
2014 | 2013 | ||||||||
Raw materials | $ | 3,098,000 | $ | 3,098,000 | |||||
Work-in-process | 222,000 | 222,000 | |||||||
Finished goods | 449,000 | 449,000 | |||||||
Reserve for obsolescence | (3,401,000 | ) | (3,342,000 | ) | |||||
$ | 368,000 | $ | 427,000 | ||||||
Inventory reserve charged to operations amounted to $59,000 and $1,660,000 during 2014 and 2013, respectively. Inventory valuation adjustments and other inventory write-offs in 2014 and 2013 amounted to $0 and $692,000, respectively. |
Property_and_Equipment
Property and Equipment | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Notes to Financial Statements | |||||||||
Property and Equipment | Property and equipment consisted of the following at December 31: | ||||||||
2014 | 2013 | ||||||||
Computers and software | $ | 59,000 | $ | 59,000 | |||||
Machinery and equipment | 209,000 | 251,000 | |||||||
Furniture and office equipment | 86,000 | 86,000 | |||||||
Demonstration vehicles and buses | 127,000 | 127,000 | |||||||
481,000 | 523,000 | ||||||||
Less accumulated depreciation and amortization | (481,000 | ) | (443,000 | ) | |||||
Total | $ | - | $ | 80,000 | |||||
Depreciation and amortization expense was $38,000 and $130,000 for the years ended December 31, 2014 and 2013, respectively, which included amortization expense of leasehold improvements of $23,000 for the year ended December 31, 2013. | |||||||||
Fixed assets totaling $0 and $405,000 were retired or disposed of in the years ended December 31, 2014 and 2013, respectively. For the year ended December 31, 2013, fixed assets with an original book value of $272,000 were exchanged in settlement of vendor payables, two vehicles were sold and four vehicles was repossessed. For the year ended December 31, 2013, the Company recorded proceeds from the sale of fixed assets of $29,000 and a loss on the disposal of fixed assets of $29,000. In addition, the Company’s headquarters lease expired on January 31, 2013, which resulted in a decrease in gross leasehold improvements in the amount of $1,327,000 and a net book value of zero. For the year ended December 31, 2014, the Company recorded an impairment loss of $42,000. |
Litigation_Judgement
Litigation Judgement | 12 Months Ended |
Dec. 31, 2014 | |
Litigation Judgement | |
Litigation Judgement | On December 12, 2012, a judgment was entered by the United States District Court Northern District of Illinois in favor of Arens Controls Company, L.L.C. in the amount of $2,014,169 regarding claims for two counts. In 2008, Arens Controls Company, L.L.C. (“Arens”) filed claims against Enova with the United States District Court Northern District of Illinois. A Partial Settlement Agreement, as amended on January 14, 2011, resolved certain claims made by Arens. However, the claims were preserved under two remaining counts concerning i) anticipatory breach of contract by Enova for certain purchase orders that resulted in lost profit to Arens and ii) reimbursement for engineering and capital equipment costs incurred by Arens exclusively for the fulfillment of certain purchase orders received from Enova. |
On September 24, 2013, Enova and Arens entered into a Settlement Agreement and Mutual Release (the "Settlement Agreement") to resolve the remaining issues between them. Under the terms of the Settlement Agreement, Enova filed on September 27, 2013 a motion to dismiss the pending appeal with prejudice and Arens agreed that, for a period of 120 calendar days from the date of the Settlement Agreement, Arens would not take any action to enforce the Judgment. Thereafter, Arens is entitled, without further notice, to enforce the Judgment against Enova or otherwise exercise all available procedures and remedies for collection of the full amount of the Judgment and Enova has agreed not to contest the validity of the Judgment. However, if Enova had paid to Arens $300,000 at any time during the 120 day period, then within 3 business days after Arens received confirmation of such payment, Arens agreed to file a satisfaction of judgment stating that the Judgment has been satisfied and completely release and forever discharge Enova from any and all claims for damages whatsoever that occurred prior to the date of the Settlement Agreement. In exchange for Arens's release, Enova agreed to completely release and forever discharge Arens from any and all claims for damages whatsoever that occurred prior to the date of the Settlement Agreement. The Company was not able to comply with the due date for such payment by January 22, 2014. Therefore, the judgment against the Company can be enforced without further notice. | |
There can be no assurance that a negotiated settlement can be attained, or that Arens will enforce its claim in the state of California and thereby cause the Company to go into bankruptcy. |
Other_Accrued_Liabilities
Other Accrued Liabilities | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Notes to Financial Statements | |||||||||
Other Accrued Liabilities | |||||||||
Other accrued liabilities consisted of the following at December 31: | |||||||||
2014 | 2013 | ||||||||
Accrued inventory received | $ | 10,000 | $ | 10,000 | |||||
Accrued professional services | 298,000 | 161,000 | |||||||
Accrued warranty | 74,000 | 74,000 | |||||||
Other | 49,000 | 49,000 | |||||||
Total | $ | 431,000 | $ | 294,000 | |||||
Accrued warranty consisted of the following activities for the years ended December 31: | |||||||||
2014 | 2013 | ||||||||
Balance at beginning of year | $ | 74,000 | $ | 117,000 | |||||
Accruals for warranties issued during the period | - | 96,000 | |||||||
Warranty claims | - | (139,000 | ) | ||||||
Balance at end of year | $ | 74,000 | $ | 74,000 | |||||
Notes_Payable
Notes Payable | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Notes to Financial Statements | |||||||||
Notes Payable | |||||||||
Notes payable at December 31, consisted of the following: | |||||||||
2014 | 2013 | ||||||||
Secured note payable to Credit Managers Association of California, bearing interest at prime plus 3% (6.25% as of December 31, 2014), and is adjusted annually in April through maturity. Principal and unpaid interest due in April 2016. A sinking fund escrow may be funded with 10% of future equity financing, as defined in the Agreement | $ | 1,238,000 | $ | 1,238,000 | |||||
Secured note payable to a Coca Cola Enterprises in the original amount of $40,000, bearing interest at 10% per annum. Principal and unpaid interest due on demand | 40,000 | 40,000 | |||||||
1,278,000 | 1,278,000 | ||||||||
Less current portion of notes payable | (40,000 | ) | (40,000 | ) | |||||
Notes payable, net of current portion | $ | 1,238,000 | $ | 1,238,000 | |||||
As of December 31, 2014 and 2013, the balance of long term interest payable amounted to $1,482,000 and $1,401,000, respectively, of which the Credit Managers Association of California note amounted to $1,442,000 and $1,365,000, respectively. Interest expense on notes payable amounted to approximately $81,000 and $85,000 during the years ended December 31, 2014 and 2013, respectively. In June 2013, the vehicle that secured the note payable due March 10, 2016 was repossessed by the secured lender. The Company was invoiced by the lender for $8,000 for final settlement, which is included in accounts payable at December 31, 2014. In the fourth quarter of 2013, three vehicles that secured notes due on February 19, 2014, August 25, 2014 and April 9, 2015 were repossessed by the secured lenders. The Company has accrued approximately $18,000 for final settlements for the three vehicles, which is included in other accrued liabilities at December 31, 2014. | |||||||||
Future minimum principal payments of notes payable at December 31, 2014 consisted of the following: | |||||||||
Year Ending December 31 | Principal | ||||||||
Amounts | |||||||||
2015 | $ | 40,000 | |||||||
2016 | 1,238,000 | ||||||||
Thereafter | — | ||||||||
Total | $ | 1,278,000 | |||||||
Deferred_Revenues
Deferred Revenues | 12 Months Ended |
Dec. 31, 2014 | |
Deferred Revenue Disclosure [Abstract] | |
Deferred Revenues | The Company had deferred $213,000 in revenue related to production and development contracts at December 31, 2014 and 2013. The Company’s management does not anticipate that funding can be obtained to complete the order in 2015. |
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2014 | |
Commitments And Contingencies | |
Commitments and Contingencies | Leases |
In October 2007, the Company entered into a lease agreement with Sunshine Distribution LP (“Landlord”), with respect to the lease of an approximately 43,000 square foot facility located at 1560 West 190th Street, Torrance, California (the “Lease”). The lease term commenced on November 1, 2007, and expired January 31, 2013. Our corporate offices are currently located at a manufacturing and warehouse facility at 2945 Columbia Street, Torrance, California which we are sub-leasing on a month-to-month basis. | |
Rent expense was approximately $72,000 and $111,000 for the years ended December 31, 2014, and 2013, respectively. |
Stockholders_Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2014 | |
Equity [Abstract] | |
Stockholders' Equity | Common Stock |
On February 23, 2014, Enova Systems, Inc, entered into Subscription Agreements with various offshore investors to sell approximately GBP 150,000 (approximately US$248,000) in gross proceeds by a private subscription of 19,999,998 common shares to be newly issued on the Alternative Investment Market of the London Stock Exchange (the "AIM Exchange"). The common shares were issued at a price of 0.0075 pence (approximately US$0.01per share) to certain eligible offshore investors (the "Subscription"). In connection with the Subscription, Enova entered into an Agreement for the Provision of Receiving Agent Services (the "Agreement") with Daniel Stewart & Company PLC (UK) for receiving agent services. Daniel Stewart presently serves as the Nominated Adviser for the listing of Enova's common shares on the AIM Exchange. The newly issued common shares for the Subscription were issued in three tranches of approximately GBP 50,000 each. | |
Daniel Stewart received an introducing agent's fee of 10% of the aggregate funds raised pursuant to the subscription in addition to reimbursement of expenses. Factoring in the commission, legal and other expenses of the offering, Enova received approximately US$223,000 in net proceeds. | |
The offer and sale of the shares were made pursuant to Regulation S under the Securities Act of 1933, as amended (the "Securities Act"). Among other things, each investor purchasing shares of Enova's common stock in the offering represented that the investor is not a United States person as defined in Regulation S. In addition, neither Enova nor the receiving agent conducted any selling efforts directed at the United States in connection with the offering. All shares of common stock issued in the offering included a restrictive legend indicating that the shares were issued pursuant to Regulation S under the Securities Act and are deemed to be "restricted securities." As a result, the purchasers of such shares will not be able to resell the shares unless in accordance with Regulation S, pursuant to a registration statement, or upon reliance of an applicable exemption from registration under the Securities Act. The shares to be sold pursuant to the Subscription Agreements were not registered under the Securities Act, and there is no obligation on the part of Enova to so register such shares. | |
On May 23, 2014, Enova Systems, Inc. and John Micek, the President and Chief Executive Officer of Enova, orally agreed that Enova will sell to John Micek, and Mr. Micek agreed to purchase from Enova, 1,250,000 shares of Enova's Common Stock at a purchase price of US $0.02 per share in consideration of the conversion of $25,000 in debt owed by Enova to Mr. Micek. As of December 31, 2014, the shares had not been issued. | |
Mr. Micek is an "accredited" investor (as such term is defined under Regulation D promulgated by the Securities and Exchange Commission ("SEC")). The Shares are expected to be sold in a transaction exempt from the registration requirements under Section 5 of the Securities Act of 1933, as amended (the "Securities Act"), pursuant to Section 4(2) thereof and in reliance upon Rule 506 of Regulation D promulgated by the SEC. | |
During the twelve months ended December 31, 2014 and 2013, the Company did not issue any shares of common stock to directors or employees as compensation. | |
Series A Preferred Stock | |
Series A preferred stock was convertible into 1/45 of a share of common stock at the election of the holder or automatically upon the occurrence of certain events including: sale of stock in an underwritten public offering; registration of the underlying conversion stock; or the merger, consolidation, or sale of more than 50% of the Company. Holders of Series A preferred stock had the same voting rights as common stockholders. The stock had a liquidation preference of $0.60 per share plus any accrued and unpaid dividends in the event of voluntary or involuntary liquidation of the Company. Dividends are non-cumulative and payable at the annual rate of $0.036 per share if, when, and as declared by, the Board of Directors. No dividends were declared on the Series A preferred stock. | |
On October 26, 2012, the Company registered 58,714 shares of common stock through a Form S-3 Registration Statement, which became effective on November 21, 2012. Therefore, all 2,642,159 outstanding shares of Series A Preferred Stock were automatically converted into 58,714 of common stock as of the effectiveness of the registration statement. The Company has not issued the common shares as of December 31, 2014. | |
Series B Preferred Stock | |
Series B preferred stock is currently unregistered. Each share is convertible into 2/45 of a share of common stock at the election of the holder or automatically upon the occurrence of certain events including: sale of stock in an underwritten public offering, if the offering results in net proceeds of $10,000,000, and the per share price of common stock is at least $2.00; and the merger, consolidation, or sale of common stock or sale of substantially all of the Company’s assets in which gross proceeds received are at least $10,000,000. The Series B preferred stock has certain liquidation and dividend rights prior and in preference to the rights of the common stock and Series A preferred stock. The stock has a liquidation preference of $2.00 per share together with an amount equal to, generally, $0.14 per share compounded annually at 7% per year from the filing date, less any dividends paid. Dividends on the Series B preferred stock are non-cumulative and payable at the annual rate of $0.14 per share if, when, and as declared by, the Board of Directors. No dividends have been declared on the Series B preferred stock. | |
Stock_Options
Stock Options | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Notes to Financial Statements | |||||||||||||||||
Stock Options | Stock Option Program Description | ||||||||||||||||
For the year ended December 31, 2014 the Company had two equity compensation plans, the 1996 Stock Option Plan (the “1996 Plan”) and the 2006 Equity Compensation Plan (the “2006 Plan”). The 1996 Plan has expired for the purposes of issuing new grants. However, the 1996 Plan will continue to govern awards previously granted under that plan. The 2006 Plan has been approved by the Company’s Shareholders. Equity compensation grants are designed to reward employees and executives for their long term contributions to the Company and to provide incentives for them to remain with the Company. The number and frequency of equity compensation grants are based on competitive practices, operating results of the Company, and government regulations. | |||||||||||||||||
The maximum number of shares issuable over the term of the 1996 Plan was limited to 65 million shares (without giving effect to subsequent stock splits). Options granted under the 1996 Plan typically have an exercise price of 100% of the fair market value of the underlying stock on the grant date and expire no later than ten years from the grant date. On August 27, 2013, the Board of Directors of Enova Systems, Inc. approved amendments to the Company’s 2006 Equity Compensation Plan to (a) increase the number of shares authorized for issuance thereunder from 3,000,000 shares to 9,000,000 shares and (b) to increase the number of shares of common stock that may be issued to an individual in any calendar year from 500,000 shares to 5,000,000 shares. The 2006 Plan has a total of 3,750,000 and 4,400,000 shares that were granted in 2014 and 2013, respectively. | |||||||||||||||||
Stock-based compensation expense related to stock options was $24,000 and $16,000 for the years ended December 31, 2014 and 2013, respectively. As of December 31, 2014, the total compensation cost related to non-vested awards not yet recognized is $55,000. The remaining period over which the future compensation cost is expected to be recognized is 25 months. | |||||||||||||||||
Stock-based compensation expense recognized in the Statement of Operations for the years ended December 31, 2014 and 2013 has been based on awards ultimately expected to vest. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. If the actual number of forfeitures differs from that estimated by management, additional adjustments to compensation expense may be required in future periods. | |||||||||||||||||
The following is a summary of changes to outstanding stock options during the fiscal year ended December 31, 2014 and 2013: | |||||||||||||||||
Weighted Average | |||||||||||||||||
Weighted Average | Remaining Contractual Life | ||||||||||||||||
Number of Share | Exercise Price | Aggregate Intrinsic | |||||||||||||||
Options | Value (1) | ||||||||||||||||
Outstanding at December 31, 2012 | 810,000 | $ | 0.64 | 4.06 | $ | — | |||||||||||
Granted | 4,400,000 | $ | 0.02 | 2.66 | $ | — | |||||||||||
Exercised | — | $ | — | — | $ | — | |||||||||||
Forfeited or Cancelled | — | $ | — | — | $ | — | |||||||||||
Outstanding at December 31, 2013 | 5,210,000 | $ | 0.12 | 2.72 | $ | — | |||||||||||
Granted | 3,750,000 | $ | 0.02 | 2.39 | $ | — | |||||||||||
Exercised | — | $ | — | — | $ | — | |||||||||||
Forfeited or Cancelled | -319,000 | $ | 0.42 | — | $ | — | |||||||||||
Outstanding at December 31, 2014 | 8,641,000 | $ | 0.06 | 2.03 | $ | — | |||||||||||
Exercisable at December 31, 2014 | 449,000 | $ | 0.85 | 2.85 | $ | — | |||||||||||
Vested and expected to vest(2) | 8,641,000 | $ | 0.06 | 2.03 | $ | — | |||||||||||
-1 | Aggregate intrinsic value represents the value of the closing price per share of our common stock on the last trading day of the fiscal period in excess of the exercise price multiplied by the number of options outstanding or exercisable, except for the “Exercised” line, which uses the closing price on the date exercised. | ||||||||||||||||
-2 | Number of shares includes options vested and those expected to vest net of estimated forfeitures. | ||||||||||||||||
During 2014 and 2013, the Company granted 3,750,000 and 4,400,000 options for fair value of $33,700 and $39,500, respectively. During 2014, 319,000 options were forfeited. | |||||||||||||||||
At December 31, 2014, there were 280,000 shares available for grant under the 2006 plan. The exercise prices of the options outstanding at December 31, 2014 ranged from $0.02 to $4.35. The weighted-average grant date fair value of the options granted during the years ended December 31, 2014 and 2013 was $0.01 and $0.01, respectively. | |||||||||||||||||
Unvested share activity for the year ended December 31, 2014 is summarized below: | |||||||||||||||||
Unvested | Weighted-Average | ||||||||||||||||
Number of | Grant Date Fair | ||||||||||||||||
Options | Value | ||||||||||||||||
Unvested balance at December 31, 2013 | 4,535,000 | $ | 0.02 | ||||||||||||||
Granted | 3,750,000 | $ | 0.01 | ||||||||||||||
Vested | (93,000 | ) | $ | 0.07 | |||||||||||||
Forfeited | — | $ | — | ||||||||||||||
Unvested balance at December 31, 2014 | 8,192,000 | $ | 0.01 | ||||||||||||||
The Company settles employee stock option exercises with newly issued common shares. The table below presents information related to stock option activity for the fiscal years ended December 31, 2014 and 2013: | |||||||||||||||||
Years Ended | |||||||||||||||||
December 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Total intrinsic value of stock options exercised | $ | — | $ | — | |||||||||||||
Cash received from stock option exercises | $ | — | $ | — | |||||||||||||
Gross income tax benefit from the exercise of stock options | $ | — | $ | — | |||||||||||||
Valuation and Expense Information | |||||||||||||||||
The fair value of stock-based awards to officers and employees is calculated using the Black-Scholes option pricing model. The Black-Scholes model requires subjective assumptions, including future stock price volatility and expected time to exercise, which greatly affect the calculated values. The expected term of options granted is calculated by using the SAB 107 “simplified method” of estimating the expected term which is derived by taking the average of the time to vesting and the full term of the option. The risk-free rate selected to value any particular grant is based on the bond equivalent yields that corresponds to the pricing term of the grant effective as of the date of the grant. The expected volatility is based on the historical volatility of the Company’s stock price. These factors could change in the future, affecting the determination of stock-based compensation expense in future periods. | |||||||||||||||||
The fair values of all stock options granted during the fiscal years ended December 31, 2014 and 2013 were estimated on the date of grant using the following range of assumptions: | |||||||||||||||||
Years Ended December 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Expected life (in years) | 1.5 | 1.5 | |||||||||||||||
Average risk-free interest rate | 2 | % | 1.66 | % | |||||||||||||
Expected volatility | 364 | % | 118% | ||||||||||||||
Expected dividend yield | 0 | % | 0 | % | |||||||||||||
Forfeiture rate | 3 | % | 3 | % | |||||||||||||
The estimated fair value of grants of stock options to nonemployees of the Company is charged to expense, if applicable, in the financial statements. These options vest in the same manner as the employee options granted under each of the option plans as described above. |
Warrants
Warrants | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||
Warrants | |||||||||||||
In December 2011, the Company completed a private equity placement of 11,250,000 shares of common stock for $1,245,000 together with warrants to purchase up to 11,250,000 shares of common stock to a group of 17 shareholders (the “Low-Beer Managed Accounts”). The warrants are exercisable for a period of five years and exercisable at a price of $0.22 per share. The warrants further provide that if, for a twenty consecutive trading day period, the average of the closing price quoted on the OTCQB market is greater than or equal to $0.44 per share, with at least an average of 10,000 shares traded per day, then, on the 10th calendar day following written notice from the Company, any outstanding warrants will be deemed automatically exercised pursuant to the cashless/net exercise provisions under the warrants. | |||||||||||||
The following is a summary of changes to outstanding warrants during the fiscal year ended December 31, 2014 and 2013: | |||||||||||||
Weighted Average | |||||||||||||
Weighted | Remaining | ||||||||||||
Number of | Average | Contractual | |||||||||||
Share | Exercise | Life | |||||||||||
Options | Price | ||||||||||||
Outstanding at December 31, 2012 | 11,250,000 | $ | 0.22 | 4 | |||||||||
Granted | — | $ | — | — | |||||||||
Exercised | — | $ | — | — | |||||||||
Forfeited or Cancelled | — | $ | — | — | |||||||||
Outstanding at December 31, 2013 | 11,250,000 | $ | 0.22 | 3 | |||||||||
Granted | — | $ | — | — | |||||||||
Exercised | — | $ | — | — | |||||||||
Forfeited or Cancelled | — | $ | — | — | |||||||||
Outstanding at December 31, 2014 | 11,250,000 | $ | 0.22 | 2 | |||||||||
Exercisable at December 31, 2014 | 11,250,000 | $ | 0.22 | 2 |
Income_Taxes
Income Taxes | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Income Taxes | |||||||||
Income Taxes | Significant components of the Company’s deferred tax assets and liabilities for federal and state income taxes as of December 31, consisted of the following: | ||||||||
2014 | 2013 | ||||||||
Deferred tax assets | |||||||||
Net operating loss carry-forwards | $ | 27,435,000 | $ | 27,516,000 | |||||
Stock based compensation | 863,000 | 852,000 | |||||||
Other, net | 143,000 | 36,000 | |||||||
28,441,000 | 28,404,000 | ||||||||
Less valuation allowance | (28,441,000 | ) | (28,404,000 | ) | |||||
Net deferred tax assets | $ | — | $ | — | |||||
The Tax Reform Act of 1986 limits the use of net operating loss carryforwards in certain situations where changed occur in the stock ownership of a company. In the event the Company has had a change in ownership, utilization of the carryforwards could be restricted. | |||||||||
Deferred taxes arise from temporary differences in the recognition of certain expenses for tax and financial reporting purposes. The deferred tax assets have been offset by a valuation allowance since management does not believe the recoverability of these in future years is more likely than not to occur. The valuation allowance increased by $37,000 in 2014 compared to an increase of $887,000 in 2013. As of December 31, 2014, the Company had net operating loss carry forwards for federal and state income tax purposes of approximately $68,269,000 and $47,769,000, respectively. These operating loss carry forwards will expire in 2015 through 2034. | |||||||||
The provision for income taxes differs from the amount computed by applying the U.S. federal statutory tax rate (34% in 2014 and 2013) to income taxes as follows: | |||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Tax benefit computed at 34% | $ | (210,000 | ) | $ | (987,000 | ) | |||
Change in valuation allowance | 31,000 | 887,000 | |||||||
State tax (net of Federal benefit) | (36,000 | ) | (169,000 | ) | |||||
Change in carryovers and tax attributes | 215,000 | 269,000 | |||||||
Net tax benefit | $ | — | $ | — | |||||
The Company files federal income tax returns in the U.S. and in various state jurisdictions. The Company has not been audited by the Internal Revenue Service or any state for income taxes. The Company reviews its recognition threshold and measurement process for recording in the financial statements uncertain tax positions taken or expected to be taken in a tax return. The Company reviews all material tax positions for all years open to statute to determine whether it is more likely than not that the positions taken would be sustained based on the technical merits of those positions. The Company did not recognize any adjustments for uncertain tax positions as of and during the years ended December 31, 2014 and 2013. | |||||||||
Employee_Benefit_Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2014 | |
Employee Benefit Plan | |
Employee Benefit Plan | The Company had a 401(k) profit sharing plan covering substantially all employees. Eligible employees were able to elect to contribute a percentage of their annual compensation, as defined, to the plan. The Company also was permitted to elect to make discretionary contributions. For the year ended December 31, 2013, the Company did not make any contributions to the plan. The Company closed the 401(k) plan in 2013. |
Geographic_Area_Data
Geographic Area Data | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Geographic Area Data | |||||||||
Geographic Area Data | |||||||||
The Company operates as a single reportable segment and attributes revenues to countries based upon the location of the entity originating the sale. Revenues by geographic area are as follows: | |||||||||
2014 | 2013 | ||||||||
United States | $ | — | $ | 87,000 | |||||
China | — | 324,000 | |||||||
United Kingdom | — | 8,000 | |||||||
Korea | — | 7,000 | |||||||
Japan | — | — | |||||||
Total | $ | — | $ | 426,000 | |||||
Concentration
Concentration | 12 Months Ended |
Dec. 31, 2014 | |
Notes to Financial Statements | |
Concentration | The Company’s sales were concentrated with a few large customers. During the year ended December 31, 2014, the Company had zero in sales and two customers accounted for 62% and 38% of gross accounts receivable. During the year ended December 31, 2013, sales to two customers comprised 76% and 19% of total revenues and two customers accounted for 62% and 38% of gross accounts receivable, respectively. The Company performs ongoing credit evaluations of certain customers’ financial condition and generally requires no collateral from its customers. The Company’s inventory purchases are concentrated with certain key vendors that produce components according to our engineering specifications. During the year ended December 31, 2013, 47% of purchases were concentrated with one vendor. There were no inventory purchases in 2014. |
Subsequent_Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2014 | |
Subsequent Events | |
Subsequent Events | The Company has evaluated subsequent events and has determined that there were no subsequent events to recognize or disclose in these financial statements. |
Related_Party_Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2014 | |
Related Party Transactions | |
Related Party Transactions | As of December 31, 2014, Mr. Micek, who serves as Chief Executive Officer, has loaned the Company a total of $55,000 in support of continued operations. As of April 1, 2015, Mr. Micek has advanced $84,000 to the Company. |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Summary Of Significant Accounting Policies Policies | |||||||||
Basis of Presentation | These financial statements have been prepared in accordance with accounting principles generally accepted in the United States. | ||||||||
Revenue Recognition | The Company manufactures proprietary products and other products based on design specifications provided by its customers. | ||||||||
The Company recognizes revenue only when all of the following criteria have been met: | |||||||||
• | Persuasive evidence of an arrangement exists; | ||||||||
• | Delivery has occurred or services have been rendered; | ||||||||
• | The fee for the arrangement is fixed or determinable; and | ||||||||
• | Collectability is reasonably assured. | ||||||||
Persuasive Evidence of an Arrangement — The Company documents all terms of an arrangement in a written contract signed by the customer prior to recognizing revenue. Receipt of a customer purchase order is the primary method of determining that persuasive evidence of an arrangement exists. | |||||||||
Delivery Has Occurred or Services Have Been Rendered — The Company performs all services or delivers all products prior to recognizing revenue. Professional consulting and engineering services are considered to be performed when the services are complete. Equipment is considered delivered upon delivery to a customer’s designated location. In certain instances, the customer elects to take title upon shipment. | |||||||||
The Fee for the Arrangement is Fixed or Determinable — Prior to recognizing revenue, a customer’s fee is either fixed or determinable under the terms of the written contract. Fees professional consulting services, engineering services and equipment sales are fixed under the terms of the written contract. The customer’s fee is negotiated at the outset of the arrangement and is not subject to refund or adjustment during the initial term of the arrangement. | |||||||||
Collectability is Reasonably Assured — The Company determines that collectability is reasonably assured prior to recognizing revenue. Collectability is assessed on a customer-by-customer basis based on criteria outlined by management. New customers are subject to a credit review process, which evaluates the customer’s financial position and ultimately its ability to pay. The Company does not enter into arrangements unless collectability is reasonably assured at the outset. Existing customers are subject to ongoing credit evaluations based on payment history and other factors. If it is determined during the arrangement that collectability is not reasonably assured, revenue is recognized on a cash basis. Amounts received upfront for engineering or development fees under multiple-element arrangements are deferred and recognized over the period of committed services or performance, if such arrangements require the Company to provide on-going services or performance. All amounts received under collaborative research agreements or research and development contracts are nonrefundable, regardless of the success of the underlying research. | |||||||||
Since some customer orders contain multiple items such as equipment and services which are delivered at varying times, the Company determines whether the delivered items can be considered separate units of accounting. Delivered items are considered separate units of accounting if delivered items have value to the customer on a standalone basis, there is objective and reliable evidence of the fair value of undelivered items, and if delivery of undelivered items is probable and substantially in the Company’s control. The recognition of revenue from milestone payments is over the remaining minimum period of performance obligation. As required, the Company evaluates its sales contract to ascertain whether multiple element agreements are present. | |||||||||
The Company recognizes engineering and construction contract revenues using the percentage-of-completion method, based primarily on contract costs incurred to date compared with total estimated contract costs. Customer-furnished materials, labor, and equipment, and in certain cases subcontractor materials, labor, and equipment, are included in revenues and cost of revenues when management believes that the company is responsible for the ultimate acceptability of the project. Contracts are segmented between types of services, such as engineering and construction, and accordingly, gross margin related to each activity is recognized as those separate services are rendered. Changes to total estimated contract costs or losses, if any, are recognized in the period in which they are determined. Claims against customers are recognized as revenue upon settlement. Revenues recognized in excess of amounts billed are classified as current assets under contract work-in-progress. Amounts billed to clients in excess of revenues recognized to date are classified as current liabilities under advance billings on contracts. Changes in project performance and conditions, estimated profitability, and final contract settlements may result in future revisions to engineering and development contract costs and revenue. | |||||||||
Deferred Revenues | The Company recognizes revenues as earned. Amounts billed in advance of the period in which service is rendered are recorded as a liability under deferred revenues. The Company has entered into several production and development contracts with customers. The Company has evaluated these contracts, ascertained the specific revenue generating activities of each contract, and established the units of accounting for each activity. Revenue on these units of accounting is not recognized until a) there is persuasive evidence of the existence of a contract, b) the service has been rendered and delivery has occurred, c) there is a fixed and determinable price, and d) collectability is reasonable assured. | ||||||||
Warranty Costs | The Company provides product warranties for specific product lines and accrues for estimated future warranty costs in the period in which revenue is recognized. Our products are generally warranted to be free of defects in materials and workmanship for a period of 12 to 24 months from the date of installation, subject to standard limitations for equipment that has been altered by other than Enova Systems personnel and equipment which has been subject to negligent use. Warranty provisions are based on past experience of product returns, number of units repaired and our historical warranty incidence over the past twenty-four month period. The warranty liability is evaluated on an ongoing basis for adequacy and may be adjusted as additional information regarding expected warranty costs becomes known. | ||||||||
Shipping and Handling Costs | The Company includes shipping and handling costs associated with inbound and outbound freight in costs of goods sold. | ||||||||
Cash and Cash Equivalents | Short-term, highly liquid investments with an original maturity of three months or less are considered cash equivalents. Certificates of deposits that have a penalty for early withdrawal are excluded from cash and cash equivalents. | ||||||||
Accounts Receivable and Allowance for Doubtful Accounts | Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in the Company’s existing accounts receivable; however, changes in circumstances relating to accounts receivable may result in a requirement for additional allowances in the future. Past due balances over 90 days and other higher risk amounts are reviewed individually for collectability. If the financial condition of the Company’s customers were to deteriorate resulting in an impairment of their ability to make payment, additional allowances may be required. In addition, the Company maintains a general reserve for all invoices by applying a percentage based on the age category. Account balances are charged against the allowance after all collection efforts have been exhausted and the potential for recovery is considered remote. As of December 31, 2014 and 2013, the Company maintained a reserve of $404,000 for doubtful accounts receivable. There was bad debt expense recorded of $0 and $108,000 in 2014 and 2013, respectively. | ||||||||
Inventory | Inventories and supplies are comprised of materials used in the design and development of electric, hybrid electric, and fuel cell drive systems, and other power and ongoing management and control components for production and ongoing development contracts, finished goods and work-in-progress, and is stated at the lower of cost or market utilizing the first-in, first-out (FIFO) cost flow assumption. The Company maintains a perpetual inventory system and continuously records the quantity on-hand and standard cost for each product, including purchased components, subassemblies and finished goods. The Company maintains the integrity of perpetual inventory records through periodic physical counts of quantities on hand. Finished goods are reported as inventories until the point of transfer to the customer. Generally, title transfer is documented in the terms of sale. | ||||||||
Inventory reserve | The Company maintains an allowance against inventory for the potential future obsolescence or excess inventory. A substantial decrease in expected demand for our products, or decreases in our selling prices could lead to excess or overvalued inventories and could require us to substantially increase our allowance for excess inventory. If future customer demand or market conditions are less favorable than our projections, additional inventory write-downs may be required and would be reflected in cost of revenues in the period the revision is made. | ||||||||
Property and Equipment | Property and equipment are stated at cost and depreciated over the estimated useful lives of the related assets, which range from three to seven years using the straight-line method for financial statement purposes. The Company uses other depreciation methods (generally, accelerated depreciation methods) for tax purposes where appropriate. Amortization of leasehold improvements is computed using the straight-line method over the shorter of the remaining lease term or the estimated useful lives of the improvements. | ||||||||
Repairs and maintenance are expensed as incurred. Expenditures that increase the value or productive capacity of assets are capitalized. When property and equipment are retired, sold, or otherwise disposed of, the asset’s cost and related accumulated depreciation are removed from the accounts and any gain or loss is included in operations. | |||||||||
Impairment of Long-Lived Assets | The Company reviews the carrying value of property and equipment for impairment whenever events and circumstances indicate that the carrying value of an asset may not be recoverable from the estimated future cash flows expected to result from its use and eventual disposition. In cases where undiscounted expected future cash flows are less than the carrying value, an impairment loss is recognized equal to an amount by which the carrying value exceeds the fair value of assets. The factors considered by management in performing this assessment include current operating results, trends, and prospects, as well as the effects of obsolescence, demand, competition, and other economic factors. Long-lived assets that management commits to sell or abandon are reported at the lower of carrying amount or fair value less cost to sell. | ||||||||
Fair Value of Financial Instruments | The carrying amount of financial instruments, including cash and cash equivalents, certificates of deposit, accounts receivable, accounts payable and other accrued liabilities, approximate fair value due to the short maturity of these instruments. The recorded values of notes payable and long-term debt approximate their fair values, as interest approximates market rates. | ||||||||
The Company defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. At December 31, 2014 and 2013, the Company had no financial assets or liabilities periodically re-measured at fair value. | |||||||||
Stock Based Compensation | The Company measures and recognizes compensation expense for all share-based payment awards made to employees and directors, including employee stock options based on the estimated fair values at the date of grant. The compensation expense is recognized over the requisite service period. | ||||||||
The Company’s determination of estimated fair value of share-based awards utilizes the Black-Scholes option-pricing model. The Black-Scholes model is affected by the Company’s stock price as well as assumptions regarding certain highly complex and subjective variables. These variables include, but are not limited to the Company’s expected stock price volatility over the term of the awards as well as actual and projected employee stock options exercise behaviors. | |||||||||
The cash flows from the tax benefits resulting from tax deductions in excess of the compensation cost recognized for those options are to be classified as financing cash flows. Due to the Company’s loss position, there were no such tax benefits for the years ended December 31, 2014 and 2013. | |||||||||
The Company determines the fair value of the restricted stock awards utilizing the quoted market prices of the Company’s shares on the date they were granted. | |||||||||
Research and Development | Research development, and engineering costs are expensed in the period incurred. Costs of significantly altering existing technology are expensed as incurred. | ||||||||
Income Taxes | The Company accounts for income taxes under an asset and liability approach. This process involves calculating the temporary and permanent differences between the carrying amounts of the assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The temporary differences can result in deferred tax assets and liabilities, which would be recorded on the Company’s balance sheets. The Company must assess the likelihood that its deferred tax assets will be recovered from future taxable income and, to the extent the Company believes that recovery is not likely, the Company must establish a valuation allowance. Changes in the Company’s valuation allowance in a period are recorded through the income tax provision on the statements of operations. | ||||||||
Uncertainty in income taxes are recognized in the Company’s financial statements based on the recognition threshold and measurement attributes for financial statement disclosure of tax positions taken or expected to be taken on a tax return. The impact of an uncertain income tax position on the income tax return must be recognized at the largest amount that is more-likely-than-not to be sustained upon audit by the relevant taxing authority. An uncertain income tax position will not be recognized if it has less than a 50% likelihood of being sustained. During 2014 and 2013, the Company did not recognize any liability for unrecognized income tax benefits. | |||||||||
Loss Per Share | Basic loss per share is computed by dividing loss available to common stockholders by the weighted-average number of common shares outstanding. Diluted loss per share is computed similar to basic loss per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. Common equivalent shares are excluded from the computation if their effect is anti-dilutive. The Company’s common share equivalents consist of stock options, warrants and preferred stock. | ||||||||
The potential shares, which are excluded from the determination of basic and diluted net loss per share as their effect is anti-dilutive, are as follows: | |||||||||
Fiscal Years Ended December 31, | |||||||||
2014 | 2013 | ||||||||
Options to purchase common stock | 8,641,000 | 5,210,000 | |||||||
Warrants to purchase common stock | 11,250,000 | 11,250,000 | |||||||
Common shares to be issued | 1,309,000 | 59,000 | |||||||
Series B preferred shares conversion | 24,000 | 24,000 | |||||||
Potential equivalent shares excluded | 21,224,000 | 16,543,000 | |||||||
Commitments and Contingencies | Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur. The Company’s management and its legal counsel assess such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company’s legal counsel evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material, would be disclosed. | ||||||||
Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the nature of the guarantee would be disclosed. | |||||||||
Estimates | The preparation of financial statements in accordance with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. | ||||||||
Concentration of Credit Risk | Financial instruments which potentially subject the Company to concentrations of credit risk consist of cash and cash equivalents and accounts receivable. The Company places its cash and cash equivalents with high credit, quality financial institutions. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash and cash equivalents. With respect to accounts receivable, the Company assesses the financial strength of its customers and, as a consequence, believes that the receivable credit risk exposure is limited. | ||||||||
Recent Accounting Pronouncements | Certain accounting standards that have been issued or proposed by the FASB or other standards-setting bodies are not expected to have a material impact on the Company’s financial position, results of operations and cash flows. | ||||||||
ln August 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2014-15, "Presentation of Financial Statements - Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern" ("ASU 2014-15"). ASU 2014-15 is intended to define management's responsibility to evaluate whether there is substantial doubt about an entity's ability to continue as a going concern and to provide related footnote disclosures. Specifically, ASU 2014-15 provides a definition of the term substantial doubt and requires an assessment for a period of one year after the date that the financial statements are issued (or available to be issued). lt also requires certain disclosures when substantial doubt is alleviated as a result of consideration of management's plans and requires an express statement and other disclosures when substantial doubt is not alleviated. The new standard will be effective for reporting periods beginning after December 15, 2016, with early adoption permitted. Management is currently evaluating the impact of the adoption of ASU 2014-14 on our financial statement disclosures. | |||||||||
On June 19, 2014, the FASB issued ASU No. 2014-12, Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period, which clarifies that entities should treat performance targets that can be met after the requisite service period of a share-based payment award as performance conditions that affect vesting. Under the ASU, an entity would not record compensation expense related to an award for which transfer to the employee is contingent on the entity's satisfaction of a performance target until it becomes probable that the performance target will be met. The adoption of this ASU will be required, either on a retrospective basis or prospective basis, beginning with our Quarterly Report on Form 10-Q for the quarter ending March 31, 2016. The adoption of this ASU is not expected to have a material impact on our consolidated financial statements. |
Summary_of_Significant_Account2
Summary of Significant Accounting Policies (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Summary Of Significant Accounting Policies Tables | |||||||||
Anti-dilutive shares excluded from computation of Earnings per Share | Fiscal Years Ended December 31, | ||||||||
2014 | 2013 | ||||||||
Options to purchase common stock | 8,641,000 | 5,210,000 | |||||||
Warrants to purchase common stock | 11,250,000 | 11,250,000 | |||||||
Common shares to be issued | 1,309,000 | 59,000 | |||||||
Series B preferred shares conversion | 24,000 | 24,000 | |||||||
Potential equivalent shares excluded | 21,224,000 | 16,543,000 |
Inventory_Tables
Inventory (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Inventory Tables | |||||||||
Inventory | 2014 | 2013 | |||||||
Raw materials | $ | 3,098,000 | $ | 3,098,000 | |||||
Work-in-process | 222,000 | 222,000 | |||||||
Finished goods | 449,000 | 449,000 | |||||||
Reserve for obsolescence | (3,401,000 | ) | (3,342,000 | ) | |||||
$ | 368,000 | $ | 427,000 |
Property_and_Equipment_Tables
Property and Equipment (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Property And Equipment Tables | |||||||||
Property and equipment | 2014 | 2013 | |||||||
Computers and software | $ | 59,000 | $ | 59,000 | |||||
Machinery and equipment | 209,000 | 251,000 | |||||||
Furniture and office equipment | 86,000 | 86,000 | |||||||
Demonstration vehicles and buses | 127,000 | 127,000 | |||||||
481,000 | 523,000 | ||||||||
Less accumulated depreciation and amortization | (481,000 | ) | (443,000 | ) | |||||
Total | $ | - | $ | 80,000 |
Other_Accrued_Liabilities_Tabl
Other Accrued Liabilities (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Other Accrued Liabilities Tables | |||||||||
Other accrued liabilities | 2014 | 2013 | |||||||
Accrued inventory received | $ | 10,000 | $ | 10,000 | |||||
Accrued professional services | 298,000 | 161,000 | |||||||
Accrued warranty | 74,000 | 74,000 | |||||||
Other | 49,000 | 49,000 | |||||||
Total | $ | 431,000 | $ | 294,000 | |||||
Accrued warranty | 2014 | 2013 | |||||||
Balance at beginning of year | $ | 74,000 | $ | 117,000 | |||||
Accruals for warranties issued during the period | - | 96,000 | |||||||
Warranty claims | - | (139,000 | ) | ||||||
Balance at end of year | $ | 74,000 | $ | 74,000 |
Notes_Payable_LongTerm_Debt_an
Notes Payable, Long-Term Debt and Other Financing (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Notes Payable Long-Term Debt And Other Financing Tables | |||||||||
Notes payable | 2014 | 2013 | |||||||
Secured note payable to Credit Managers Association of California, bearing interest at prime plus 3% (6.25% as of December 31, 2014), and is adjusted annually in April through maturity. Principal and unpaid interest due in April 2016. A sinking fund escrow may be funded with 10% of future equity financing, as defined in the Agreement | $ | 1,238,000 | $ | 1,238,000 | |||||
Secured note payable to a Coca Cola Enterprises in the original amount of $40,000, bearing interest at 10% per annum. Principal and unpaid interest due on demand | 40,000 | 40,000 | |||||||
1,278,000 | 1,278,000 | ||||||||
Less current portion of notes payable | (40,000 | ) | (40,000 | ) | |||||
Notes payable, net of current portion | $ | 1,238,000 | $ | 1,238,000 | |||||
Future minimum principal payments of notes payable | Year Ending December 31 | Principal | |||||||
Amounts | |||||||||
2015 | $ | 40,000 | |||||||
2016 | 1,238,000 | ||||||||
Thereafter | — | ||||||||
Total | $ | 1,278,000 |
Stock_Options_Tables
Stock Options (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Stock Options Tables | |||||||||||||||||
Stock options outstanding and exercisable | Weighted Average | ||||||||||||||||
Weighted Average | Remaining Contractual Life | ||||||||||||||||
Number of Share | Exercise Price | Aggregate Intrinsic | |||||||||||||||
Options | Value (1) | ||||||||||||||||
Outstanding at December 31, 2012 | 810,000 | $ | 0.64 | 4.06 | $ | — | |||||||||||
Granted | 4,400,000 | $ | 0.02 | 2.66 | $ | — | |||||||||||
Exercised | — | $ | — | — | $ | — | |||||||||||
Forfeited or Cancelled | — | $ | — | — | $ | — | |||||||||||
Outstanding at December 31, 2013 | 5,210,000 | $ | 0.12 | 2.72 | $ | — | |||||||||||
Granted | 3,750,000 | $ | 0.02 | 2.39 | $ | — | |||||||||||
Exercised | — | $ | — | — | $ | — | |||||||||||
Forfeited or Cancelled | -319,000 | $ | 0.42 | — | $ | — | |||||||||||
Outstanding at December 31, 2014 | 8,641,000 | $ | 0.06 | 2.03 | $ | — | |||||||||||
Exercisable at December 31, 2014 | 449,000 | $ | 0.85 | 2.85 | $ | — | |||||||||||
Vested and expected to vest(2) | 8,641,000 | $ | 0.06 | 2.03 | $ | — | |||||||||||
Unvested share activity | Unvested | Weighted-Average | |||||||||||||||
Number of | Grant Date Fair | ||||||||||||||||
Options | Value | ||||||||||||||||
Unvested balance at December 31, 2013 | 4,535,000 | $ | 0.02 | ||||||||||||||
Granted | 3,750,000 | $ | 0.01 | ||||||||||||||
Vested | (93,000 | ) | $ | 0.07 | |||||||||||||
Forfeited | — | $ | — | ||||||||||||||
Unvested balance at December 31, 2014 | 8,192,000 | $ | 0.01 | ||||||||||||||
Stock option activity | Years Ended | ||||||||||||||||
December 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Total intrinsic value of stock options exercised | $ | — | $ | — | |||||||||||||
Cash received from stock option exercises | $ | — | $ | — | |||||||||||||
Gross income tax benefit from the exercise of stock options | $ | — | $ | — | |||||||||||||
Fair Value of Stock options | |||||||||||||||||
Years Ended December 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Expected life (in years) | 1.5 | 1.5 | |||||||||||||||
Average risk-free interest rate | 2 | % | 1.66 | % | |||||||||||||
Expected volatility | 364 | % | 118% | ||||||||||||||
Expected dividend yield | 0 | % | 0 | % | |||||||||||||
Forfeiture rate | 3 | % | 3 | % |
Warrants_Tables
Warrants (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||
Outstanding warrants | Weighted Average | ||||||||||||
Weighted | Remaining | ||||||||||||
Number of | Average | Contractual | |||||||||||
Share | Exercise | Life | |||||||||||
Options | Price | ||||||||||||
Outstanding at December 31, 2012 | 11,250,000 | $ | 0.22 | 4 | |||||||||
Granted | — | $ | — | — | |||||||||
Exercised | — | $ | — | — | |||||||||
Forfeited or Cancelled | — | $ | — | — | |||||||||
Outstanding at December 31, 2013 | 11,250,000 | $ | 0.22 | 3 | |||||||||
Granted | — | $ | — | — | |||||||||
Exercised | — | $ | — | — | |||||||||
Forfeited or Cancelled | — | $ | — | — | |||||||||
Outstanding at December 31, 2014 | 11,250,000 | $ | 0.22 | 2 | |||||||||
Exercisable at December 31, 2014 | 11,250,000 | $ | 0.22 | 2 |
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Income Taxes Tables | |||||||||
Deferred tax assets and liabilities | 2014 | 2013 | |||||||
Deferred tax assets | |||||||||
Net operating loss carry-forwards | $ | 27,435,000 | $ | 27,516,000 | |||||
Stock based compensation | 863,000 | 852,000 | |||||||
Other, net | 143,000 | 36,000 | |||||||
28,441,000 | 28,404,000 | ||||||||
Less valuation allowance | (28,441,000 | ) | (28,404,000 | ) | |||||
Net deferred tax assets | $ | — | $ | — | |||||
Provision for income taxes | December 31, | December 31, | |||||||
2014 | 2013 | ||||||||
Tax benefit computed at 34% | $ | (210,000 | ) | $ | (987,000 | ) | |||
Change in valuation allowance | 31,000 | 887,000 | |||||||
State tax (net of Federal benefit) | (36,000 | ) | (169,000 | ) | |||||
Change in carryovers and tax attributes | 215,000 | 269,000 | |||||||
Net tax benefit | $ | — | $ | — |
Geographic_Area_Data_Tables
Geographic Area Data (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Geographic Area Data Tables | |||||||||
Revenue by geographic area | 2014 | 2013 | |||||||
United States | $ | — | $ | 87,000 | |||||
China | — | 324,000 | |||||||
United Kingdom | — | 8,000 | |||||||
Korea | — | 7,000 | |||||||
Japan | — | — | |||||||
Total | $ | — | $ | 426,000 |
Description_of_the_Company_and
Description of the Company and its Business (Details Narrative) (USD $) | 1 Months Ended | 12 Months Ended | 1 Months Ended | |
Dec. 31, 2012 | Dec. 31, 2014 | Feb. 28, 2014 | Dec. 31, 2013 | |
State of incorporation | California | |||
Net working capital | ($3,149,000) | ($2,963,000) | ||
Change in net working capital | -186,000 | |||
Accumulated deficit | -162,870,000 | -162,251,000 | ||
Shareholders' equity deficit | 2,634,000 | -5,869,000 | -5,522,000 | |
Judgement | 2,014,169 | |||
Settlement | 300,000 | |||
Subscription Arrangement [Member] | ||||
Proceeds | 248,000 | |||
Purchase agreement | 19,999,998 | |||
Agent fee rate | 1.00% | |||
Net proceeds | $223,000 |
Summary_of_Significant_Account3
Summary of Significant Accounting Policies (Details) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Antidilutive securities | 21,224,000 | 16,543,000 |
Stock Option [Member] | ||
Antidilutive securities | 641,000 | 5,210,000 |
Warrant [Member] | ||
Antidilutive securities | 11,250,000 | 11,250,000 |
CommonStockToBeIssued [Member] | ||
Antidilutive securities | 1,309,000 | 59,000 |
Series B Preferred Stock [Member] | ||
Antidilutive securities | 24,000 | 24,000 |
Summary_of_Significant_Account4
Summary of Significant Accounting Policies (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Summary Of Significant Accounting Policies Details Narrative | ||
Reserve for doubtful accounts receivable | $404,000 | $404,000 |
Bad debt expense | $0 | $108,000 |
Inventory_Details
Inventory (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Inventory | ||
Raw Materials | $3,098,000 | $3,098,000 |
Work In Progress | 222,000 | 222,000 |
Finished Goods | 449,000 | 449,000 |
Reserve for Obsolescence | -3,401,000 | -3,342,000 |
Total | $368,000 | $427,000 |
Inventory_Details_Narrative
Inventory (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Inventory Details | ||
Inventory reserve | $59,000 | $1,660,000 |
Inventory valuation adjustments | $0 | $692,000 |
Property_and_Equipment_Details
Property and Equipment (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Property and Equipment | ||
Computers and software | $59,000 | $59,000 |
Machinery and equipment | 209,000 | 251,000 |
Furniture and office equipment | 86,000 | 86,000 |
Demonstration vehicles and buses | 127,000 | 127,000 |
Plant And Property Gross | 481,000 | 523,000 |
Less accumulated depreciation and amortization | -481,000 | -443,000 |
Total | $80,000 |
Property_and_Equipment_Details1
Property and Equipment (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Property and Equipment | ||
Depreciation and amortization expense | $38,000 | $130,000 |
Amortization of leasehold improvements | 23,000 | |
Fixed assets retired or disposed | 0 | 405,000 |
Assets exchanged in settlement of vendor payables | 272,000 | |
Proceeds from sale of fixed assets | 29,000 | |
Loss on impairment of fixed assets | 42,000 | |
Decrease in leashold improvements | $1,327,000 |
Litigation_Judgement_Details_N
Litigation Judgement (Details Narrative) (USD $) | 1 Months Ended |
Dec. 31, 2012 | |
Litigation Judgement Details Narrative | |
Judgement | $2,014,169 |
Settlement | $300,000 |
Other_Accrued_Liabilities_Deta
Other Accrued Liabilities (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Other accrued liabilities | ||
Accrued inventory received | $10,000 | $10,000 |
Accrued professional services | 298,000 | 161,000 |
Accrued warranty | 74,000 | 74,000 |
Other | 49,000 | 49,000 |
Total | $431,000 | $294,000 |
Other_Accrued_Liabilities_Deta1
Other Accrued Liabilities (Details 1) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Accrued warranty | ||
Balance at beginning of period | $74,000 | $117,000 |
Accruals for warranties issued during the period | 96,000 | |
Warranty claims | -139,000 | |
Balance at end of period | $74,000 | $74,000 |
Notes_Payable_Details
Notes Payable (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Notes Payable, Long-Term Debt and Other Financing | ||
Notes payable, Gross | $1,278,000 | $1,278,000 |
Less current portion of notes payable | -40,000 | -40,000 |
Notes payable, net of current portion | 1,238,000 | 1,238,000 |
PrimePlusThreePercentNoteMember | ||
Notes Payable, Long-Term Debt and Other Financing | ||
Notes payable, Gross | 1,238,000 | 1,238,000 |
TenPercentNoteMember | ||
Notes Payable, Long-Term Debt and Other Financing | ||
Notes payable, Gross | $40,000 | $40,000 |
Notes_Payable_Details_1
Notes Payable (Details 1) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Notes Payable Details 1 | ||
2015 | $40,000 | |
2016 | 1,238,000 | |
Thereafter | ||
Total | $1,278,000 | $1,278,000 |
Notes_Payable_Details_Narrativ
Notes Payable (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Notes Payable, Long-Term Debt and Other Financing | ||
Long term interest payable | $1,482,000 | $1,401,000 |
Interest expense on notes payable | 81,000 | 85,000 |
Accrued liability | 8,000 | |
Accrued settlements for vehicles | 18,000 | |
CreditManagersAssociationofCaliforniaMember | ||
Notes Payable, Long-Term Debt and Other Financing | ||
Long term interest payable | $1,442,000 | $1,365,000 |
Deferred_Revenues_Details_Narr
Deferred Revenues (Details Narrative) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Deferred Revenue Disclosure [Abstract] | ||
Deferred revenue | $213,000 | $213,000 |
Commitments_and_Contingencies_
Commitments and Contingencies (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Commitments And Contingencies Details Narrative | ||
Rent expense | $72,000 | $111,000 |
Sunshine lease begin date | 11/1/07 | |
Sunshine lease expiration date | 31-Jan-13 |
Stockholders_Equity_Details_Na
Stockholders' Equity (Details Narrative) (USD $) | 1 Months Ended | 12 Months Ended | 1 Months Ended | ||
Nov. 30, 2011 | Dec. 31, 2014 | Feb. 28, 2014 | 30-May-14 | Dec. 31, 2013 | |
Shares of common stock issued | 11,250,000 | ||||
Shares registered | 58,714 | ||||
Series A Preferred Stock | |||||
Convertible preferred stock terms of conversion | Jan-45 | ||||
Series A convertible preferred stock liquidating preference | 0.6 | $0.60 | |||
Dividends payable rate | 0.036 | ||||
Shares registered | 58,714 | ||||
Shares converted to common stock | 2,642,159 | ||||
Series B Preferred Stock | |||||
Convertible preferred stock terms of conversion | Feb-45 | ||||
Series A convertible preferred stock liquidating preference | 2 | $2 | |||
Dividends payable rate | 0.14 | ||||
Subscription Arrangement [Member] | |||||
Shares, Purchase agreement | 19,999,998 | ||||
Proceeds | $248,000 | ||||
Purchase agreement share price | $0.01 | ||||
Tranche amount | 50,000 | ||||
Agent fee rate | 1.00% | ||||
Net proceeds | 223,000 | ||||
Micek [Member] | |||||
Shares, Purchase agreement | 1,250,000 | ||||
Purchase agreement share price | $0.02 | ||||
Debt converted | $25,000 |
Stock_Options_Details
Stock Options (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Stock Options Details | ||
Outstanding at beginning of period | 5,210,000 | 810,000 |
Granted | 3,750,000 | 4,400,000 |
Exercised | ||
Forfeited or Cancelled | -319,000 | |
Outstanding at end of period | 8,641,000 | 5,210,000 |
Exercisable at end of period | 449,000 | |
Vested and expected to vest | 8,641,000 | |
Outstanding at beginning of period | $0.12 | $0.64 |
Granted | $0.02 | $0.02 |
Exercised | ||
Forfeited or Cancelled | $0.42 | |
Outstanding at end of period | $0.06 | $0.12 |
Exercisable at end of period | $0.85 | |
Vested and expected to vest | $0.06 | |
Outstanding at beginning of period | 2 years 8 months 19 days | 4 years 0 months 22 days |
Granted | 2 years 4 months 20 days | 2 years 7 months 28 days |
Outstanding at end of period | 2 years 10 days | 2 years 8 months 19 days |
Exercisable at end of period | 2 years 10 months 6 days | |
Vested and expected to vest | 2 years 10 days | |
Outstanding at beginning of period | ||
Granted | ||
Exercised | ||
Forfeited or Cancelled | ||
Outstanding at end of period | ||
Exercisable at end of period | ||
Vested and expected to vest |
Stock_Options_Details_1
Stock Options (Details 1) (USD $) | 12 Months Ended |
Dec. 31, 2014 | |
Stock Options Details 1 | |
Unvested balance at beginning of period | 4,535,000 |
Granted | 3,750,000 |
Vested | -93,000 |
Forfeited | |
Unvested balance at end of period | 8,192,000 |
Unvested balance at beginning of period | $0.02 |
Granted | $0.01 |
Vested | $0.07 |
Forfeited | |
Unvested balance at end of period | $0.01 |
Stock_Options_Details_2
Stock Options (Details 2) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Stock Options Details 2 | ||
Expected life (in years) | 1 year 6 months | 1 year 6 months |
Average risk-free interest rate | 2.00% | 1.66% |
Expected volatility | 364.00% | 118.00% |
Expected dividend yield | 0.00% | 0.00% |
Forfeiture rate | 3.00% | 3.00% |
Stock_Options_Details_Narrativ
Stock Options (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Notes to Financial Statements | ||
Maximum shares issuable pursuant to plan | 65,000,000 | |
Shares reserved for issuance | 9,000,000 | 3,000,000 |
Authorized amount of shares issuable to any individual per calendar year | 5,000,000 | 500,000 |
Granted shares | 3,750,000 | 4,400,000 |
Stock based compensation expense | $24,000 | $16,000 |
Total compensation cost related to non-vested awards not yet recognized | 55,000 | |
Future compensation cost is expected to be recognized | 25 months | |
Fair value of options granted under plan | $33,700 | $39,500 |
Forfeited | -319,000 | |
Exercise prices of the options outstanding Minimum | $0.02 | |
Exercise prices of the options outstanding Maximum | $4.35 | |
Shares available for grant | 280,000 | |
Weighted average grant-date fair value of options | $0.01 | $0.01 |
Warrants_Details
Warrants (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Outstanding at beginning of period | 5,210,000 | 810,000 |
Granted | 3,750,000 | 4,400,000 |
Exercised | ||
Forfeited or Cancelled | -319,000 | |
Outstanding at end of period | 8,641,000 | 5,210,000 |
Exercisable at end of period | 449,000 | |
Outstanding at beginning of period | $0.12 | $0.64 |
Granted | $0.02 | $0.02 |
Exercised | ||
Forfeited or Cancelled | $0.42 | |
Outstanding at end of period | $0.06 | $0.12 |
Exercisable at end of period | $0.85 | |
Outstanding at beginning of period | 2 years 8 months 19 days | 4 years 0 months 22 days |
Outstanding at end of period | 2 years 10 days | 2 years 8 months 19 days |
Exercisable at end of period | 2 years 10 months 6 days | |
Warrant [Member] | ||
Outstanding at beginning of period | 11,250,000 | 11,250,000 |
Granted | ||
Exercised | ||
Forfeited or Cancelled | ||
Outstanding at end of period | 11,250,000 | 11,250,000 |
Exercisable at end of period | 11,250,000 | |
Outstanding at beginning of period | $0.22 | $0.22 |
Granted | ||
Exercised | ||
Forfeited or Cancelled | ||
Outstanding at end of period | $0.22 | $0.22 |
Exercisable at end of period | $0.22 | |
Outstanding at beginning of period | 3 years | 4 years |
Outstanding at end of period | 2 years | 3 years |
Exercisable at end of period | 2 years |
Warrants_Details_Narrative
Warrants (Details Narrative) (USD $) | 1 Months Ended |
Nov. 30, 2011 | |
Warrants Details Narrative | |
Private equity placement | 11,250,000 |
Proceeds from private placement | $1,245,000 |
Warrants issued | 11,250,000 |
Warrant term | 5 years |
Warrant exercise price | $0.22 |
Closing price limit | $0.44 |
Daily trading minimum | 10,000 |
Income_Taxes_Details
Income Taxes (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Deferred tax assets | ||
Net operating loss carry-forwards | $27,435,000 | $27,516,000 |
Stock based compensation | 863,000 | 852,000 |
Other, net | 143,000 | 36,000 |
Gross deferred tax assets | 28,441,000 | 28,404,000 |
Less valuation allowance | -28,441,000 | -28,404,000 |
Net deferred tax assets |
Income_Taxes_Details_1
Income Taxes (Details 1) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Income Taxes Details | ||
Tax benefit computed at 34% | ($210,000) | ($987,000) |
Change in valuation allowance | 31,000 | 887,000 |
State tax (net of Federal benefit) | -36,000 | -169,000 |
Change in carryovers and tax attributes | 215,000 | 269,000 |
Net tax benefit |
Income_Taxes_Details_Narrative
Income Taxes (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Income Taxes Details Narrative | ||
Valuation allowance increase | $37,000 | $887,000 |
Net operating loss carry forwards | $68,269,000 | $47,769,000 |
Federal statutory tax rate | 34.00% |
Geographic_Area_Data_Details
Geographic Area Data (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Revenue | $426,000 | |
United States [Member] | ||
Revenue | 87,000 | |
China [Member] | ||
Revenue | 324,000 | |
United Kingdom [Member] | ||
Revenue | 8,000 | |
Korea [Member] | ||
Revenue | 7,000 | |
Japan [Member] | ||
Revenue |
Concentration_Details_Narrativ
Concentration (Details Narrative) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Customer 1 [Member] | Accounts Receivable [Member] | ||
Concentration risk | 62.00% | 62.00% |
Customer 1 [Member] | Sales Revenue, Services, Net [Member] | ||
Concentration risk | 76.00% | |
Customer 2 [Member] | Accounts Receivable [Member] | ||
Concentration risk | 38.00% | 38.00% |
Customer 2 [Member] | Sales Revenue, Services, Net [Member] | ||
Concentration risk | 19.00% | |
Vendor [Member] | Supplier Concentration Risk [Member] | ||
Concentration risk | 47.00% |
Related_Party_Transactions_Det
Related Party Transactions (Details Narrative) (USD $) | Dec. 31, 2014 | Apr. 23, 2014 |
Related Party Transactions Details Narrative | ||
Related party debt | $55,000 | $84,000 |