Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Mar. 25, 2019 | Sep. 30, 2018 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | Aerkomm Inc. | ||
Entity Central Index Key | 0001590496 | ||
Trading Symbol | AKOM | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Document Type | 10-KT | ||
Document Period End Date | Dec. 31, 2018 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2018 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 65,434,791 | ||
Entity Common Stock, Shares Outstanding | 9,247,272 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2018 | Mar. 31, 2018 | Dec. 31, 2017 |
Current Assets | |||
Cash | $ 88,309 | $ 58,237 | $ 21,504 |
Accounts receivable | 1,745,000 | ||
Inventories | 208,674 | 208,674 | |
Prepaid expenses | 1,479,123 | 362,602 | 543,642 |
Other receivable - related party | 46,743 | ||
Other receivable - others | 2,616 | 427,291 | 412,390 |
Temporary deposit - related party | 100,067 | ||
Other current assets | 11,336 | 1,202 | 6,591 |
Total Current Assets | 3,426,451 | 1,058,006 | 1,239,544 |
Property and Equipment | |||
Cost | 2,715,543 | 407,501 | 405,319 |
Accumulated depreciation | (322,049) | (119,782) | (100,592) |
Property and equipment | 2,393,494 | 287,719 | 304,727 |
Prepayment for land | 35,237,127 | ||
Prepayment for equipment | 54,625 | 181,250 | |
Construction in progress | 1,311,245 | 3,254,170 | 3,250,000 |
Net Property and Equipment | 38,996,491 | 3,723,139 | 3,554,727 |
Other Assets | |||
Intangible asset, net | 3,382,500 | 3,753,750 | 3,877,500 |
Goodwill | 1,475,334 | 1,450,536 | 1,450,536 |
Deposits - related party | 2,462 | 2,542 | 2,396 |
Deposits - others | 105,447 | 148,839 | 141,273 |
Total Other Assets | 4,965,743 | 5,355,667 | 5,471,705 |
Total Assets | 47,388,685 | 10,136,812 | 10,265,976 |
Current Liabilities | |||
Short-term bank loan | 10,000 | 10,000 | |
Short-term loan - related party | 325,040 | ||
Accounts payable | 1,650,000 | ||
Accrued expenses | 412,165 | 881,214 | 637,675 |
Other payable - related parties | 949,298 | 1,299,578 | 1,082,395 |
Other payable - others | 2,956,488 | 2,264,637 | 2,081,787 |
Total Current Liabilities | 5,967,951 | 4,780,469 | 3,811,857 |
Restricted stock deposit liability | 1,000 | 14 | 56 |
Total Liabilities | 5,968,951 | 4,780,483 | 3,811,913 |
Commitments | |||
Stockholders' Equity | |||
Preferred stock, $0.001 par value, 50,000,000 shares authorized, none issued and outstanding as of December 31, 2018, March 31, 2018 and December 31, 2017 | |||
Common stock, $0.001 par value, 90,000,000 shares authorized, 9,098,090 shares (excluding 149,162 unvested restricted shares) issued and outstanding as of December 31, 2018; 8,289,947 shares (excluding 2,072 unvested restricted shares) issued and outstanding as of March 31, 2018; 8,283,733 shares (excluding 8,286 unvested restricted shares) issued and outstanding as of December 31, 2017 | 45,490 | 41,449 | 41,418 |
Additional paid in capital | 56,546,408 | 13,787,341 | 13,484,857 |
Subscribed capital | 690,648 | 75,040 | |
Subscriptions receivable | (559,608) | ||
Accumulated deficits | (15,292,128) | (8,602,971) | (7,143,788) |
Accumulated other comprehensive income (loss) | 119,964 | (530) | (3,464) |
Total Stockholders' Equity | 41,419,734 | 5,356,329 | 6,454,063 |
Total Liabilities and Stockholders' Equity | $ 47,388,685 | $ 10,136,812 | $ 10,265,976 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2018 | Mar. 31, 2018 | Dec. 31, 2017 |
Stockholders' Equity | |||
Preferred stock, par value | $ 0.001 | $ 0.001 | $ 0.001 |
Preferred stock, authorized | 50,000,000 | 50,000,000 | 50,000,000 |
Preferred stock, issued | |||
Preferred stock, outstanding | |||
Common stock, par value | $ 0.001 | $ 0.001 | $ 0.001 |
Common stock, authorized | 90,000,000 | 90,000,000 | 90,000,000 |
Common stock, issued | 9,098,090 | 8,289,947 | 8,283,733 |
Common stock, outstanding | 9,098,090 | 8,289,947 | 8,283,733 |
Unvested restricted shares | 149,162 | 2,072 | 8,286 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Loss - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenue | |||||
Net sales | $ 1,730,000 | $ 1,730,000 | |||
Service income | 15,000 | 15,000 | |||
Total Revenue | 1,745,000 | 1,745,000 | |||
Cost and Expenses | |||||
Cost of sales | 1,661,849 | 1,661,849 | |||
Operating expenses | 1,450,899 | 6,645,134 | 6,233,393 | 8,096,033 | 7,147,597 |
Total Cost and Expenses | 1,450,899 | 8,306,983 | 6,233,393 | 9,757,882 | 7,147,597 |
Loss from Operations | (1,450,899) | (6,561,983) | (6,233,393) | (8,012,882) | (7,147,597) |
Net Non-Operating Income (Loss) | (4,222) | (127,113) | (1,877) | (131,335) | 23,652 |
Loss Before Income Taxes | (1,455,121) | (6,689,096) | (6,235,270) | (8,144,217) | (7,123,945) |
Income Tax Expense | 4,062 | 61 | 6,134 | 4,123 | 8,519 |
Net Loss | (1,459,183) | (6,689,157) | (6,241,404) | (8,148,340) | (7,132,464) |
Other Comprehensive Income (Loss) | |||||
Change in foreign currency translation adjustments | 2,934 | 120,494 | (107) | 123,428 | (3,454) |
Total Comprehensive Loss | $ (1,456,249) | $ (6,568,663) | $ (6,241,511) | $ (8,024,912) | $ (7,135,918) |
Net Loss Per Common Share: | |||||
Basic | $ (0.176) | $ (0.7403) | $ (0.7602) | $ (0.9205) | $ (0.8736) |
Diluted | $ (0.176) | $ (0.7403) | $ (0.7602) | $ (0.9205) | $ (0.8736) |
Weighted Average Shares Outstanding - Basic | 8,292,034 | 9,035,386 | 8,210,464 | 8,852,094 | 8,164,313 |
Weighted Average Shares Outstanding - Diluted | 8,292,034 | 9,035,386 | 8,210,464 | 8,852,094 | 8,164,313 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Equity - USD ($) | Total | Common Stock | Additional Paid in Capital | Subscribed Capital | Subscription Receivable | Retained Earnings (Accumulated Deficits) | Accumulated Other Comprehensive Loss | Total Stockholders' Equity | Non Controlling Interest in Subsidiary |
Beginning Balance at Dec. 31, 2016 | $ 5,862,318 | $ 4,470,839 | $ 80,000 | $ 1,862,643 | $ (551,204) | $ (10) | $ 5,862,268 | $ 50 | |
Beginning Balance, Shares at Dec. 31, 2016 | 19,744,012 | ||||||||
Reverse acquisition | $ (4,433,221) | 5,756,024 | (1,862,643) | 539,880 | 10 | 50 | (50) | ||
Reverse acquisition, Shares | (12,220,291) | ||||||||
Issuance of common stock | 4,387,427 | $ 1,349 | 5,838,551 | (1,452,473) | 4,387,427 | ||||
Issuance of common stock, Shares | 269,849 | ||||||||
Issuance of stock warrant | 60,000 | 60,000 | 60,000 | ||||||
Subscribed capital | 1,527,513 | 1,527,513 | 1,527,513 | ||||||
Restricted stock vested and transferred to common stock | 3,287 | $ 2,451 | 836 | 3,287 | |||||
Restricted stock vested and transferred to common stock, Shares | 490,163 | ||||||||
Stock compensation expense | 1,749,446 | 1,749,446 | 1,749,446 | ||||||
Net loss for the period | (7,132,464) | (7,132,464) | (7,132,464) | ||||||
Other comprehensive income (loss) | (3,464) | (3,464) | (3,464) | ||||||
Ending Balance at Dec. 31, 2017 | 6,454,063 | $ 41,418 | 13,484,857 | 75,040 | (7,143,788) | (3,464) | 6,454,063 | ||
Ending Balance, Shares at Dec. 31, 2017 | 8,283,733 | ||||||||
Issuance of stock warrant | 26,667 | 26,667 | 26,667 | ||||||
Subscription receivable | (559,608) | (559,608) | (559,608) | ||||||
Subscribed capital | 615,608 | 615,608 | 615,608 | ||||||
Restricted stock vested and transferred to common stock | 42 | $ 31 | 11 | 42 | |||||
Restricted stock vested and transferred to common stock, Shares | 6,214 | ||||||||
Stock compensation expense | 275,806 | 275,806 | 275,806 | ||||||
Net loss for the period | (1,459,183) | (1,459,183) | (1,459,183) | ||||||
Other comprehensive income (loss) | 2,934 | 2,934 | 2,934 | ||||||
Ending Balance at Mar. 31, 2018 | 5,356,329 | $ 41,449 | 13,787,341 | 690,648 | (559,608) | (8,602,971) | (530) | 5,356,329 | |
Ending Balance, Shares at Mar. 31, 2018 | 8,289,947 | ||||||||
Issuance of common stock | 41,262,899 | $ 5,298 | 41,388,641 | (690,648) | 559,608 | 41,262,899 | |||
Issuance of common stock, Shares | 1,059,646 | ||||||||
Issuance of stock warrant | 223,700 | 223,700 | 223,700 | ||||||
Restricted stock vested and transferred to common stock | 14 | $ 10 | 4 | 14 | |||||
Restricted stock vested and transferred to common stock, Shares | 2,072 | ||||||||
Common stock transferred back to unvested restricted stock | (1,700) | $ (1,267) | (433) | (1,700) | |||||
Common stock transferred back to unvested restricted stock, Shares | (253,575) | ||||||||
Stock compensation expense | 1,147,155 | 1,147,155 | 1,147,155 | ||||||
Net loss for the period | (6,689,157) | (6,689,157) | (6,689,157) | ||||||
Other comprehensive income (loss) | 120,494 | 120,494 | 120,494 | ||||||
Ending Balance at Dec. 31, 2018 | $ 41,419,734 | $ 45,490 | $ 56,546,408 | $ (15,292,128) | $ 119,964 | $ 41,419,734 | |||
Ending Balance, Shares at Dec. 31, 2018 | 9,098,090 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | |
Cash Flows From Operating Activities | |||||
Net loss | $ (1,459,183) | $ (6,689,157) | $ (6,241,404) | $ (8,148,340) | $ (7,132,464) |
Adjustments to reconcile net loss to net cash used for operating activities: | |||||
Depreciation and amortization | 142,940 | 573,541 | 421,811 | 716,481 | 551,767 |
Stock-based compensation | 275,806 | 1,147,155 | 1,740,446 | 1,422,961 | 1,749,446 |
R&D expenses transferred from inventory and construction in progress | 732,828 | 732,828 | |||
Changes in operating assets and liabilities: | |||||
Accounts receivable | (1,745,000) | (1,745,000) | |||
Inventories | 1,230 | 1,055 | |||
Prepaid expenses | (210) | (1,116,521) | (262,878) | (1,116,731) | (521,949) |
Other receivable - related party | 46,743 | 162,335 | (53,324) | 162,335 | |
Other receivable - others | (14,901) | 424,675 | 181,278 | 409,774 | (318) |
Temporary deposit - related party | (100,067) | ||||
Other current assets | 5,389 | (10,134) | (4,745) | ||
Deposits - related party | (7,566) | 80 | 6,511 | (66) | 2,570 |
Deposits - others | (146) | 43,392 | 660,132 | 35,826 | 660,132 |
Accounts payable | 1,650,000 | 1,650,000 | |||
Accrued expenses | 243,539 | (469,049) | 450,419 | (225,510) | 506,822 |
Other payable - related parties | 217,183 | (350,280) | (2,350,334) | (133,097) | (2,373,180) |
Other payable - others | 182,850 | (695,276) | 216,945 | (512,426) | 392,299 |
Net Cash Used for Operating Activities | (367,556) | (6,603,813) | (5,013,509) | (6,971,369) | (6,001,485) |
Cash Flows from Investing Activities | |||||
Prepaid investment | 360,000 | ||||
Prepayment on land and satellite equipment | (33,850,000) | (33,850,000) | |||
Purchase of property and equipment | (6,352) | (762,670) | (273,015) | (769,022) | (273,015) |
Acquisitions of goodwill | (24,798) | (24,798) | |||
Net Cash Provided by (Used for) Investing Activities | (6,352) | (34,637,468) | 86,985 | (34,643,820) | (273,015) |
Cash Flows from Financing Activities | |||||
Proceeds from (Repayment of) short-term bank loan | (10,000) | 10,000 | (10,000) | 10,000 | |
Proceeds from (Repayment of) short-term loan - related party | 325,040 | (325,040) | |||
Proceeds from issuance of common stock | 41,262,899 | 2,887,428 | 41,318,899 | 5,839,901 | |
Payment on repurchase of restricted stock | (700) | (700) | |||
Proceeds from subscribed capital | 56,000 | 1,527,513 | 75,040 | ||
Issuance of stock warrant | 26,667 | 223,700 | 30,000 | 250,367 | 60,000 |
Net Cash Provided by Financing Activities | 407,707 | 41,150,859 | 4,454,941 | 41,558,566 | 5,984,941 |
Net (Decrease) Increase in Cash | 33,799 | (90,422) | (471,583) | (56,623) | (289,559) |
Cash from acquired subsidiaries | 2,354 | 2,354 | |||
Cash, Beginning of Period | 21,504 | 58,237 | 490,840 | 21,504 | 312,173 |
Foreign Currency Translation Effect on Cash | 2,934 | 120,494 | (107) | 123,428 | (3,464) |
Cash, End of Period | 58,237 | 88,309 | 21,504 | 88,309 | 21,504 |
Supplemental disclosures of cash flow information: | |||||
Cash paid during the period for income taxes | 4,061 | 6,239 | 4,061 | 6,239 | |
Cash paid during the period for interest | 113 | 2,008 | 131 | 2,121 | 131 |
Non-cash Operating and Financing Activities: | |||||
Construction in progress transferred to other receivable | 410,000 | ||||
Restricted stock deposit liability transferred to (from) common stock | 42 | (1,686) | 2,315 | (1,644) | 3,287 |
Other payable to related parties transferred to subscribed capital | 2,027,400 | 2,027,400 | |||
Total payment for acquisition of subsidiaries | |||||
Cash | 14,527 | 5,704 | 14,527 | 5,704 | |
Prepaid expenses | 4,317 | 16,500 | 4,317 | 16,500 | |
Other receivable - related party | 43,448 | 210,259 | 43,448 | 210,259 | |
Property and equipment - net | 5,152 | 5,152 | |||
Goodwill | 24,798 | 344,594 | 24,798 | 344,594 | |
Accrued expenses | (60,640) | (60,640) | |||
Other payable | (518,219) | (518,219) | |||
Total payment for acquisition of subsidiaries | $ 87,090 | $ 3,350 | $ 87,090 | $ 3,350 |
Organization
Organization | 12 Months Ended |
Dec. 31, 2018 | |
Organization [Abstract] | |
Organization | NOTE 1 - Organization Aerkomm Inc. (formerly Maple Tree Kids Inc.) (“Aerkomm”) was incorporated on August 14, 2013 in the State of Nevada. Aerkomm was a retail distribution company selling all of its products over the internet in the United States, operating in the infant and toddler products business market. On December 28, 2016, Aircom Pacific Inc. (“Aircom”) purchased 140,000 shares of Aerkomm’s common stock, representing approximately 86.3% of Aerkomm’s issued and outstanding common stock as of the closing date of purchase. As a result of the transaction, Aircom became the controlling shareholder of Aerkomm. On February 13, 2017, Aerkomm entered into a share exchange agreement (“Exchange Agreement”) with Aircom and its shareholders, pursuant to which Aerkomm acquired 100% of the issued and outstanding capital stock of Aircom in exchange for approximately 99.7% of the issued and outstanding capital stock of Aerkomm (or 87.81% on a fully-diluted basis). As a result of the share exchange, Aircom became a wholly-owned subsidiary of Aerkomm, and the former shareholders of Aircom became the holders of approximately 99.7% of Aerkomm’s issued and outstanding capital stock. Aircom was incorporated on September 29, 2014 under the laws of the State of California. On December 31, 2014, Aircom acquired a newly incorporated subsidiary, Aircom Pacific Ltd. (“Aircom Seychelles”), a corporation formed under the laws of the Republic of Seychelles. Aircom Seychelles was formed to facilitate Aircom’s global corporate structure for both business operations and tax planning. Presently, Aircom Seychelles has no operations. Aircom is working with corporate and tax advisers in finalizing its global corporate structure and has not yet concluded its final plan. On October 17, 2016, Aircom acquired a wholly owned subsidiary, Aircom Pacific Inc. Limited (“Aircom HK”), a corporation formed under the laws of Hong Kong. The purpose of Aircom HK is to conduct Aircom’s business and operations in Hong Kong. Presently, its primary function is business development, both with respect to airlines as well as content providers and advertisement partners based in Hong Kong. Aircom HK is also actively seeking strategic partnerships whom Aircom may leverage in order to provide more and better services to its customers. Aircom also plans to provide local supports to Hong Kong-based airlines via Aircom HK and teleports located in Hong Kong. On December 15, 2016, Aircom acquired a wholly owned subsidiary, Aircom Japan, Inc. (“Aircom Japan”), a corporation formed under the laws of Japan. The purpose of Aircom Japan is to conduct business development and operations located within Japan. Aircom Japan is in the process of applying for, and will be the holder of, Satellite Communication Blanket License in Japan, which is necessary for Aircom to provide services within Japan. Aircom Japan will also provide local supports to airlines operating within the territory of Japan. Aircom Telecom LLC (“Aircom Taiwan”), which became a wholly owned subsidiary of Aircom in December 2017, was organized under the laws of Taiwan on June 29, 2016. During 2017, Aircom advanced a total of $460,000 to Aircom Taiwan, which was not affiliated with Aircom during that time, for working capital, as part of a planned $1,500,000 aggregate equity investment (the “Equity Investment”) in Aircom Taiwan. Before Aircom Taiwan was allowed to issue equity to Aircom, a foreign investor, the Equity Investment must be approved by the Investment Review Committee of the Ministry of Economic affairs of Taiwan (the “Committee”). Aircom entered into an Equity Pre-Subscription Agreement with Aircom Taiwan on August 13, 2017 to memorialize the terms of the Equity Investment. On December 19, 2017, the Committee approved Aircom’s initial Equity Investment (valued as of that date at NT$15,150,000, or approximately US$500,000) and the purchase of the founding owner’s total equity of NT$100,000 (approximately US$3,350). As a result, Aircom Taiwan became a wholly owned subsidiary of Aircom. Aircom Taiwan is responsible for Aircom’s business development efforts and general operations within Taiwan. We are currently planning to locate the site of our first ground station in Taiwan and we expect that if we raise sufficient funds to move forward with this project (although that cannot be guaranteed), Aircom Taiwan will play a significant role in building and operating that ground station. On June 13, 2018, Aerkomm established a new wholly owned subsidiary, Aerkomm Taiwan Inc. (“Aerkomm Taiwan”), a corporation formed under the laws of Taiwan. The purpose of Aerkomm Taiwan is to purchase a parcel of land for ground station building and operate the ground station for data processing. On November 15, 2018, Aircom Taiwan acquired a wholly owned subsidiary, Beijing Yatai Communication Co., Ltd. (“Aircom Beijing”), a corporation formed under the laws of China. The purpose of Aircom Beijing is to conduct Aircom’s business and operations in China. Presently, its primary function is business development, both with respect to airlines as well as content providers and advertisement partners based in China as most business conducted in China requires a local registered company. Aircom Beijing is also actively seeking strategic partnerships whom Aircom may leverage in order to provide more and better services to its customers. Aircom also plans to provide local supports to China-based airlines via Aircom Beijing and teleports located in China. Aircom and its subsidiaries (the “Company”) are full-service, development stage providers of in-flight entertainment and connectivity solutions with their initial market in the Asian Pacific region. The Company has not generated significant revenues, excluding non-recurring revenues from affiliates in the second quarter of fiscal 2018, and will incur additional expenses as a result of being a public reporting company. If the Company is unable to obtain additional working capital, the Company’s business may fail. For the nine-month period and the year ended December 31, 2018, the Company incurred a comprehensive loss of $6,568,663 and $8,024,912, respectively, and had working capital deficiency of $2,541,500 as of December 31, 2018, which raises substantial doubt about its ability to continue as a going concern. Currently, the Company has taken measures that management believes will improve its financial position by financing activities, short-term borrowings and equity contributions. On January 16, 2019, the Company completed a 1-for-5 reverse split of the Company’s authorized, issued and outstanding shares of common stock, which was completed by the filing of a Certificate of Change Pursuant to NRS 78.209 with the Nevada Secretary of State on December 26, 2018 (see Note 15). All of the references in these financial statements to authorized common stock and issued and outstanding common stock have been adjusted to reflect this reverse split. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2018 | |
Summary of Significant Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | NOTE 2 - Summary of Significant Accounting Policies Changes in Fiscal Year On March 18, 2018, the Company’s Board of Directors approved a change in the Company’s fiscal year end from December 31 to March 31. Year-over-year quarterly financial data continue to be comparative to prior periods as the three months that comprise each fiscal quarter in the new fiscal year are the same as those in the Company’s historical financial statements. On February 12, 2019, the Company’s Board of Directors approved a change in the Company’s fiscal year end from March 31 to December 31. Year-over-year quarterly financial data continue to be comparative to prior periods as the nine months that comprise each fiscal quarter in the new fiscal year are the same as those in the Company’s historical financial statements. Principle of Consolidation Aerkomm consolidates the accounts of its subsidiaries, Aircom, Aircom Seychelles, Aircom HK, Aircom Japan, Aircom Taiwan, Aerkomm Taiwan and Aircom Beijing. All significant intercompany accounts and transactions have been eliminated in consolidation. Reclassifications of Prior Period Presentation Certain prior period balance sheet and income statement amounts have been reclassified for consistency with the current period presentation. These reclassifications had no effect on the reported results of operations. Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results may differ from these estimates. Concentrations of Credit Risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash in banks. As of December 31, 2018, all cash in bank was fully insured by the Federal Deposit Insurance Corporation (FDIC) for the Company and no balance of cash in foreign bank exceeded the amount insured by local deposit insurance. The Company performs ongoing credit evaluation of its customers and requires no collateral. An allowance for doubtful accounts is provided based on a review of the collectability of accounts receivable. The Company determines the amount of allowance for doubtful accounts by examining its historical collection experience and current trends in the credit quality of its customers as well as its internal credit policies. Actual credit losses may differ from management’s estimates. Inventories Inventories are recorded at the lower of weighted-average cost or net realizable value. The Company assesses the impact of changing technology on its inventory on hand and writes off inventories that are considered obsolete. Estimated losses on scrap and slow-moving items are recognized in the allowance for losses. Property and Equipment Property and equipment are stated at cost less accumulated depreciation. When value impairment is determined, the related assets are stated at the lower of fair value or book value. Significant additions, renewals and betterments are capitalized. Maintenance and repairs are expensed as incurred. Depreciation is computed by using the straight-line and double declining methods over the following estimated service lives: ground station equipment – 5 years, computer equipment - 3 to 5 years, furniture and fixtures - 5 years, satellite equipment – 5 years, vehicles – 5 years and lease improvement – 5 years. Construction costs for on-flight entertainment equipment not yet in service are recorded under construction in progress. Upon sale or disposal of property and equipment, the related cost and accumulated depreciation are removed from the corresponding accounts, with any gain or loss credited or charged to income in the period of sale or disposal. The Company reviews the carrying amount of property and equipment for impairment when events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. It determined that there was no impairment loss for the nine-month periods ended December 31, 2018 and 2017. Goodwill and Purchased Intangible Assets The Company’s goodwill represents the amount by which the total purchase price paid exceeded the estimated fair value of net assets acquired from acquisition of subsidiaries. The Company tests goodwill for impairment on an annual basis, or more often if events or circumstances indicate that there may be impairment. Purchased intangible assets with finite life are amortized on the straight-line basis over the estimated useful lives of respective assets. Purchased intangible assets with indefinite life are evaluated for impairment when events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Purchased intangible asset consists of satellite system software and is amortized over 10 years. Fair Value of Financial Instruments The Company utilizes the three-level valuation hierarchy for the recognition and disclosure of fair value measurements. The categorization of assets and liabilities within this hierarchy is based upon the lowest level of input that is significant to the measurement of fair value. The three levels of the hierarchy consist of the following: Level 1 - Inputs to the valuation methodology are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. Level 2 - Inputs to the valuation methodology are quoted prices for similar assets and liabilities in active markets, quoted prices in markets that are not active or inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the instrument. Level 3 - Inputs to the valuation methodology are unobservable inputs based upon management’s best estimate of inputs market participants could use in pricing the asset or liability at the measurement date, including assumptions. The carrying amounts of the Company’s cash, accounts receivable, other receivable, short-term bank loan and other payable approximated their fair value due to the short-term nature of these financial instruments. Revenue Recognition The Company recognizes revenue when performance obligations identified under the terms of contracts with its customers are satisfied, which generally occurs upon the transfer of control in accordance with the contractual terms and conditions of the sale. The Company’s major revenue for the nine-month period and the year ended December 31, 2018 was the development of a small cell server terminal which will be utilized in the construction of a satellite-based ground communication system networks. The Company also had minor revenue from providing installation and testing services of a satellite-based ground connectivity system. The majority of the Company’s revenue is recognized at a point in time when product is shipped or service is provided to the customer. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring goods, which includes estimates for variable consideration. Research and Development Costs Research and development costs are charged to operating expenses as incurred. For the nine-month periods ended December 31, 2018 and 2017, the three-month period ended March 31, 2018 and the years ended December 31, 2018 and 2017 the Company incurred $1,451,202, $366,047, $90,750 (unaudited), $1,541,952 and $336,000 of research and development costs, respectively. Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are computed for differences between the financial statement and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Income tax expense is the tax payable or refundable for the period plus or minus the change during the period in deferred tax assets and liabilities. Adjustments to prior period’s income tax liabilities are added to or deducted from the current period’s tax provision. The Company follows FASB guidance on uncertain tax positions and has analyzed its filing positions in all the federal, state and foreign jurisdictions where it is required to file income tax returns, as well as all open tax years in those jurisdictions. The Company files income tax returns in the US federal, state and foreign jurisdictions where it conducts business. The Company believes that its income tax filing positions and deductions will be sustained on audit and does not anticipate any adjustments that will result in a material adverse effect on its consolidated financial position, results of operations, or cash flows. Therefore, no reserves for uncertain tax positions have been recorded. The Company does not expect its unrecognized tax benefits to change significantly over the next twelve months. The Company’s policy for recording interest and penalties associated with any uncertain tax positions is to record such items as a component of income before taxes. Penalties and interest paid or received, if any, are recorded as part of other operating expenses in the consolidated statement of operations. Translation Adjustments If a foreign subsidiary’s functional currency is the local currency, translation adjustments will result from the process of translating the subsidiary’s financial statements into the reporting currency of the Company. Such adjustments are accumulated and reported under other comprehensive income (loss) as a separate component of stockholders’ equity. Earnings (Loss) Per Share Basic earnings (loss) per share is computed by dividing income available to common shareholders by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share is computed by dividing income available to common shareholders by the weighted-average number of shares of common outstanding during the period increased to include the number of additional shares of common stock that would have been outstanding if the potentially dilutive securities had been issued. Potentially dilutive securities include stock warrants and outstanding stock options, shares to be purchased by employees under the Company’s employee stock purchase plan. Subsequent Events The Company has evaluated events and transactions after the reported period up to March 22, 2019, the date on which these consolidated financial statements were available to be issued. All subsequent events requiring recognition as of December 31, 2018 have been included in these consolidated financial statements. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 12 Months Ended |
Dec. 31, 2018 | |
Recent Accounting Pronouncements [Abstract] | |
Recent Accounting Pronouncements | NOTE 3 - Recent Accounting Pronouncements Financial Instruments In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”), which modifies the measurement of expected credit losses of certain financial instruments. ASU 2016-13 will be effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The Company is currently evaluating the impact of adopting ASU 2016-13 on its consolidated financial statements. Intangibles In January 2017, the FASB issued ASU No. 2017-04, “Intangibles - Goodwill and Other” (Topic 350): Simplifying the Test for Goodwill Impairment, which goodwill shall be tested at least annually for impairment at a level of reporting referred to as a reporting unit. ASU 2017-04 will be effective for annual periods beginning after December 15, 2019. The Company is currently evaluating the impact of adopting ASU 2017-04 on its consolidated financial statements. Leases In February 2016, the FASB issued ASU No. 2016-02, “Leases” (Topic 842) (“ASU 2016-02”), which modifies lease accounting for both lessees and lessors to increase transparency and comparability by recognizing lease assets and lease liabilities by lessees for those leases classified as operating leases under previous accounting standards and disclosing key information about leasing arrangements. ASU 2016-02 will be effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, and early adoption is permitted. The Company is currently evaluating the timing of its adoption and the impact of adopting ASU 2016-02 on its consolidated financial statements. Income Statement In February 2018, FASB issued ASU 2018-02, “Income Statement - Reporting Comprehensive Income” (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income, which requires deferred tax liabilities and assets to be adjusted for the effect of a change in tax laws or rates with effect included in income from continuing operations in the reporting period that includes the enactment date of Tax Cut and Jobs Act. ASU 2018-02 will be effective for all entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. The Company is currently evaluating the timing of its adoption and the impact of adopting ASU 2018-02 on its consolidated financial statements. Stock Compensation In June 2018, FASB issued ASU 2018-07, “Compensation-Stock Compensation” (Topic 718): Improvement of Nonemployee Share-Based Payment Accounting, which amends the accounting for nonemployee share-based payment transactions for acquiring goods and services from nonemployees. ASU 2018-07 will be effective for public business entities for fiscal years beginning after December 15, 2018, and interim periods within the fiscal year. The Company is currently evaluating the timing of its adoption and the impact of adopting ASU 2018-07 on its consolidated financial statements. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2018 | |
Inventories [Abstract] | |
Inventories | NOTE 4 - Inventories As of December 31, 2018, March 31, 2018 and December 31, 2017, inventories consisted of the following: December 31, March 31, December 31, Satellite equipment for sale under construction $ - $ 197,645 $ 197,645 Parts - 11,029 11,029 Supplies 5,273 5,468 5,540 5,273 214,142 214,214 Allowance for inventory loss (5,273 ) (5,468 ) (5,540 ) Net $ - $ 208,674 $ 208,674 As of December 31, 2018, the Company transferred inventories in the amount of $11,029 to R&D expenses. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2018 | |
Property and Equipment [Abstract] | |
Property and Equipment | NOTE 5 - Property and Equipment For the nine months ended December 31, 2018, the three months ended March 31, 2018 and the year ended December 31, 2017, the changes in cost of property and equipment were as follows: Computer Furniture and fixture Satellite Ground station equipment Vehicle Leasehold Improvement Total January 1, 2017 $ 118,911 $ 10,006 $ - $ - $ - $ - $ 128,917 Addition 992 - 275,410 - - - 276,402 December 31, 2017 119,903 10,006 275,410 - - - 405,319 Addition 2,182 - - - - - 2,182 March 31, 2018 122,085 10,006 275,410 - - - 407,501 Addition 198,985 23,338 - 1,854,027 141,971 89,721 2,308,042 December 31, 2018 $ 321,070 $ 33,344 $ 275,410 $ 1,854,027 $ 141,971 $ 89,721 $ 2,715,543 As of January 1, 2017, construction in progress of $3,660,000 was the payment for the construction of ground station equipment relating to satellite communication system and in-flight system for the Company’s internal use. In 2017, one of the purchase contracts related to onboard equipment became undeliverable. Therefore, the Company reclassified the relevant payment of $410,000 recorded under construction in progress to other receivable. As a result, the balance of construction in progress was reduced to $3,250,000 as of December 31, 2017. For the three months ended March 31, 2018 and nine months ended December 31, 2018, the Company made additional payments for the expenditure of construction in progress. As of March 31, 2018, the balance of construction in progress was $3,254,170. As of December 31, 2018, the balance of construction in progress was $1,311,245 after the Company transferred construction in progress in the amount of $721,799 to R&D expenses and $1,854,027 to ground station equipment. For the nine months ended December 31, 2018, the three months ended March 31, 2018 and the year ended December 31, 2017, the changes in accumulated depreciation for property and equipment were as follows: Computer Furniture and fixture Satellite Ground station equipment Vehicle Leasehold Improvement Total January 1, 2017 $ 39,604 $ 4,221 $ - $ - $ - $ - $ 43,825 Addition 17,159 1,997 37,611 - - - 56,767 December 31, 2017 56,763 6,218 37,611 - - - 100,592 Addition 6,275 477 12,438 - - - 19,190 March 31, 2018 63,038 6,695 50,049 - - - 119,782 Addition 38,091 2,676 41,311 92,701 21,980 5,508 202,267 December 31, 2018 $ 101,129 $ 9,371 $ 91,360 $ 92,701 $ 21,980 $ 5,508 $ 322,049 On May 1, 2018, the Company and Aerkomm Taiwan entered into a binding memorandum of understanding with Tsai Ming-Yin (the “Seller”) with respect to the acquisition by Aerkomm Taiwan of a parcel of land located in Taiwan. The land is expected to be used to build a satellite ground station and data center. On July 10, 2018, the Company, Aerkomm Taiwan and the Seller entered into a certain real estate sales contract regarding this acquisition. Pursuant to the terms of the contract, and subsequent amendments on July 30, 2018, September 4, 2018, November 2, 2018 and January 3, 2019, the Company paid to the seller in installments refundable prepayment of $33.85 million as of December 31, 2018. The remaining amount of the purchase price, $624,462, which may also be paid in installments, must be paid in full by the Company and Aerkomm Taiwan in cash before January 4, 2019, which was subsequently extended to July 4, 2019. As of December 31, 2018, the estimated commission payable for the land purchase in the amount of $1,387,127 was recorded to the cost of land. |
Intangible Asset, Net
Intangible Asset, Net | 12 Months Ended |
Dec. 31, 2018 | |
Intangible Asset, Net [Abstract] | |
Intangible Asset, Net | NOTE 6 - Intangible Asset, Net For the nine months ended December 31, 2018, three months ended March 31, 2018 and the year ended December 31, 2017, the changes in cost and accumulated amortization for intangible asset were as follows: Satellite Accumulated amortization Net Cost January 1, 2017 $ 4,950,000 $ 577,500 $ 4,372,500 Addition - 495,000 (495,000 ) December 31, 2017 4,950,000 1,072,500 3,877,500 Addition - 123,750 (123,750 ) March 31, 2018 4,950,000 1,196,250 3,753,750 Addition - 371,250 (371,250 ) December 31, 2018 $ 4,950,000 $ 1,567,500 $ 3,382,500 |
Short-Term Bank Loan
Short-Term Bank Loan | 12 Months Ended |
Dec. 31, 2018 | |
Short-Term Bank Loan [Abstract] | |
Short-term Bank Loan | NOTE 7 - Short-term Bank Loan The Company has an unsecured short-term bank credit line of $10,000, which matured on June 14, 2018, from a local bank with an annual interest rate of 4.75%. The Company repaid the bank loan in full on May 24, 2018. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2018 | |
Income Taxes [Abstract] | |
Income Taxes | NOTE 8 - Income Taxes Income tax expense for the nine-month periods ended December 31, 2018 and 2017, three-month period ended March 31, 2018 and the years ended December 31, 2018 and 2017 consisted of the following: Nine Months Ended Three Months Ended Year Ended December 31, 2018 2017 2018 2018 2017 Current: (Unaudited) Federal $ 61 $ 3,033 $ - $ 61 $ 3,033 State - - 2,400 2,400 800 Foreign - 3,101 1,662 1,662 4,686 Total $ 61 $ 6,134 $ 4,062 $ 4,123 $ 8,519 The following table presents a reconciliation of the Company’s income tax at statutory tax rate and income tax at effective tax rate for the nine-month periods ended December 31, 2018 and 2017, three-month period ended March 31, 2018 and years ended December 31, 2018 and 2017. Nine Months Ended Three Months Ended Year Ended 2018 2017 2018 2018 2017 (Unaudited) Tax benefit at statutory rate $ (1,404,700 ) $ (2,082,820 ) $ (294,826 ) $ (1,699,526 ) $ (2,292,820 ) Net operating loss carryforwards (NOLs) 1,311,500 1,484,000 172,225 1,483,725 1,760,600 Stock-based compensation expense 240,900 594,800 57,919 298,819 594,800 Amortization expense (38,400 30,700 (1,700 ) (40,100 ) (11,200 ) Accrued R&D expense (168,000 ) - - (168,000 ) - Others 58,761 (20,546 ) 70,444 129,205 (42,861 ) Tax expense at effective tax rate $ 61 $ 6,134 $ 4,062 $ 4,123 $ 8,519 Deferred tax assets (liability) as of December 31, 2018, March 31, 2018 and December 31, 2017 consist of: December 31, March 31, December 31, 2017 Net operating loss carryforwards (NOLs) $ 5,632,000 $ 2,339,000 $ 2,057,000 Stock-based compensation expense 893,000 566,000 489,000 Accrued expenses and unpaid payable 184,000 268,000 443,000 Tax credit carryforwards 68,000 68,000 68,000 Excess of tax amortization over book amortization (818,000 ) (635,000 ) (658,000 ) Others 131,000 235,000 - Gross 6,090,000 2,841,000 2,399,000 Valuation allowance (6,090,000 ) (2,841,000 ) (2,399,000 ) Net $ - $ - $ - Management does not believe the deferred tax assets will be utilized in the near future; therefore, a full valuation allowance is provided. The net change in deferred tax assets valuation allowance was an increase of $3,249,000 and $442,000 for the nine months ended December 31, 2018 and the three months ended March 31, 2018. As of December 31, 2017, the Company had federal NOLs of approximately $6,686,000 available to reduce future federal taxable income, expiring in 2037. As of December 31, 2018 and March 31, 2018, additional federal NOLs of approximately $12,515,000 and $957,000, respectively, was generated and will be carried forward indefinitely to reduce future federal taxable income. As of December 31, 2018, March 31, 2018 and December 31, 2017, the Company had State NOLs of approximately $21,049,000, $8,985,000 and $7,897,000, respectively, available to reduce future state taxable income, expiring in 2038. As of December 31, 2018, March 31, 2018 and December 31, 2017, the Company has Japan NOLs of approximately $319,000, $339,000 and $326,000 available to reduce future Japan taxable income, expiring in 2028. As of December 31, 2018, March 31, 2018 and December 31, 2017, the Company has Taiwan NOLs of approximately $253,000, $0 and $0 available to reduce future Taiwan taxable income, expiring in 2028. As of December 31, 2018, March 31, 2018 and December 31, 2017, the Company had approximately $37,000, $37,000 and $37,000 of federal research and development tax credit, available to offset future federal income tax. The credit begins to expire in 2034 if not utilized. As of December 31, 2018, March 31, 2018 and December 31, 2017, the Company had approximately $39,000, $39,000 and $39,000 of California state research and development tax credit available to offset future California state income tax. The credit can be carried forward indefinitely. The Company’s ability to utilize its federal and state NOLs to offset future income taxes is subject to restrictions resulting from its prior change in ownership as defined by Internal Revenue Code Section 382. The Company does not expect to incur the limitation on NOLs utilization in future annual usage. |
Capital Stock
Capital Stock | 12 Months Ended |
Dec. 31, 2018 | |
Capital Stock [Abstract] | |
Capital Stock | NOTE 9 - Capital Stock 1) Preferred Stock: The Company is authorized to issue 10,000,000 shares of preferred stock, with par value of $0.001. As of December 31, 2018, there were no preferred stock shares outstanding. The Board of Directors has the authority to issue preferred stock in one or more series, and in connection with the creation of any such series, by resolutions providing for the issuance of the shares thereof, to determine dividends, voting rights, conversion rights, redemption privileges and liquidation preferences. 2) Common Stock: The Company is authorized to issue 90,000,000 shares of common stock, reflecting a reverse split in the ratio of 1 for 5 effective January 16, 2019, with par value of $0.001. On February 13, 2017, all of Aircom’s 5,513,334 restricted shares were converted to 2,055,947 shares of Aerkomm’s restricted stock at the ratio of 2.681651 to 1, pursuant to the Exchange Agreement (see Note 1). As of December 31, 2018, March 31, 2018 and December 31, 2017, the restricted shares consisted of the following: December 31, March 31, December 31, Restricted stock - vested 1,802,373 2,053,875 2,047,661 Restricted stock - unvested 149,162 2,072 8,286 Total restricted stock 1,951,535 2,055,947 2,055,947 The unvested shares of restricted stock were recorded under a deposit liability account awaiting future conversion to common stock when they become vested. For the nine-month period ended December 31, 2018, the reporting for 253,575 shares previously reported as vested was changed to reflect their actual status as unvested shares, to correct an incorrect presentation in previous periods. On March 31, 2017, the Company completed its private placement offering of 100,000 shares of common stock at a price of $15.00 per share for the aggregate amount of $1,500,000. On June 6, 2017, the Company completed its private placement offering of 12,000 shares of common stock at a price of $25.00 per share for the aggregate amount of $300,000. Additionally, on June 6, 2017, pursuant to a settlement and release agreement with Priceplay Taiwan Inc. (“PPTW”) dated March 31, 2017, among the Company, PPTW and Aircom, the Company issued 32,772 shares of its common stock to PPTW in settlement of an outstanding $819,300 obligation of Aircom to PPTW. Additionally, pursuant to a similar settlement and release agreement with Priceplay.com, Inc. (“PPUS”) dated March 31, 2017, the Company issued 29,480 shares of its common stock to PPUS in settlement of an outstanding $737,000 obligation of Aircom to PPUS, and pursuant to a third similar settlement and release agreement with Aircom and dMobile System Co. ltd. (dMobile), it issued 18,844 shares of its common stock to dMobile in settlement of an outstanding $471,100 obligation of Aircom to dMobile. In the aggregate, the Company has issued 81,096 shares to the three settlement recipients at a price of $25.00 per share for a total of $2,027,400. On July 5, 2017, the Company completed its first closing of a private placement offering in which it sold 1,000 shares of its common stock to Daniel Shih, the Company’s co-founder, at a price of $27.50 per share for a total of $27,500. The Company conducted additional closings in July and August for a total of $517,413. As of October 31, 2017, the total subscribed capital amounted to $544,913. On October 31, 2017, the Company completed this private placement offering of 52,818 shares of common stock at a price of $27.50 per share for the aggregate amount of $1,452,473. On November 30, 2017 and June 30, 2018, the Company issued 16,000 and 4,000 and 8,000 and 2,000 shares of its common stock to Integra Consulting Group LLC (“Integra”) and Anthony D. Altavilla, principal of Integra, respectively, according to the Consulting Agreement signed on November 15, 2017 between the Company and Integra. As of December 31, 2018, one non-employee with qualified stock options exercised the stock options and transferred to 3,935 shares of the Company’s common stock. As of March 31, 2018, the Company completed its private placement offering of 24,666 shares of its common stock at a price of $28.00 per share for the aggregate amount of $690,648. As of March 31, 2018, the common shares were issued and the subscriptions receivable of $559,608 were collected subsequently in April and May, 2018. On May 14, 2018, the Company entered into an underwriting agreement (the “Underwriting Agreement”) with Boustead Securities, LLC (“Boustead”) in connection with the public offering, issuance and sale of up to 1,411,765 shares of the Company’s common stock on a best efforts basis, with a minimum requirement of 117,647 shares, at the public offering price of $42.50 per share, less underwriting discounts, for minimum gross proceeds of $5,000,000 and up to a maximum of $60,000,000. As of December 31, 2018, pursuant to the Underwriting Agreement, the Company had issued an aggregate of 1,024,980 shares of common stock for gross proceeds of $43,560,894, or net proceeds of $39,810,204. On December 21, 2018, the Company repurchased and cancelled an aggregate of 104,413 3) Stock Warrant: The Company has entered into a service agreement which provides for the issuance of warrants to purchase shares of its common stock to a service provider as payment for services. The warrants allow the service provider to purchase a number of shares of Aerkomm common stock equal to the service fee value divided by 85% of the share price paid by investors for Aerkomm’s common stock in the first subsequent qualifying equity financing event, at an exercise price of $0.05 per share. For the three-month period ended March 31, 2018 and nine-month period ended December 31, 2018, Aerkomm has issued additional stock warrants exercisable for $26,667 and $30,000, respectively, in value of Aerkomm common stock to the service provider as payment for additional services. As of December 31, 2018, these warrants is equivalent to 4,891 shares of the Company’s common stock. In connection with the Underwriting Agreement with Boustead, the Company agreed to issue to Boustead warrants to purchase a number of the Company’s shares equal to 6% of the gross proceeds of the public offering, which shall be exercisable, in whole or in part, commencing on April 13, 2018 and expiring on the five-year anniversary at an initial exercise price of $53.125 per share, which is equal to 125% of the offering price paid by investors. As of December 31, 2018, the Company issued warrants to Boustead to purchase 61,498 shares of the Company’s stock. |
Major Customer
Major Customer | 12 Months Ended |
Dec. 31, 2018 | |
Major Customer\Vendor [Abstract] | |
Major Customer | NOTE 10 - Major Customer The Company has one major customer, which represents 10% or more of the total sales of the Company for the period. Sales to and account receivable from the customer for the nine-month period and the year ended and as of December 31, 2018 were $1,745,000. |
Major Vendor
Major Vendor | 12 Months Ended |
Dec. 31, 2018 | |
Major Customer\Vendor [Abstract] | |
Major Vendor | NOTE 11 - Major Vendor The Company has one major vendor, which represents 10% or more of the total purchases of the Company for the period. Purchases from and account payable to the vendor for the nine-month period and the year ended and as of December 31, 2018 were $1,650,000. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 12 - Related Party Transactions A. Name of related parties and relationships with the Company: Related Party Relationship Daniel Shih* Co-founder and former stockholder; Aircom’s CEO and Director between February 13, 2017 and April 26, 2017; Aircom’s CFO between February 13, 2017 and May 5, 2017 Dmedia Holding LP (“Dmedia”) 23.99% stockholder Bummy Wu Shareholder Jeffrey Wun Shareholder and CEO of Aerkomm and Aircom Yih Lieh (Giretsu) Shih President of Aircom Japan Hao Wei Peng Employee of Aircom Taiwan and founding owner of Aircom Taiwan prior to 12/19/2017 Louis Giordimaina COO - Aviation of Aircom Klingon Aerospace, Inc. (“Klingon”) Daniel Shih was the Chairman from February 2015 to February 2016 Wealth Wide Int’l Ltd. (“WWI”) Bummy Wu, a shareholder, is the Chairman WISD Intellectual Property Agency, Ltd. (“WISD”) Patrick Li, Director of Aircom, is the Chairman; Chih-Ming (Albert) Hsu, Director of the Company, is a Director Yun Shu Chiou Former CEO and President prior to December 31, 2017 * Daniel Shih has relinquished “beneficial ownership” of substantially all of his equity interests in the Company (whether held directly or indirectly) in a manner acceptable to the Company. This means that Daniel Shih no longer, directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise has or shares (i) voting power, which includes the power to vote, or to direct the voting of, securities, and/or (ii) investment power, which includes the power to dispose, or to direct the disposition of, shares of the Company’s common stock, except for a de minimus B. Significant related party transactions: The Company has extensive transactions with its related parties. It is possible that the terms of these transactions are not the same as those which would result from transactions among wholly unrelated parties. a. As of December 31, 2018, March 31, 2018 and December 31, 2017: December 31, March 31, December 31, Other receivable from Hao Wei Peng 1 $ - $ - $ 46,743 Temporary deposit to Bummy Wu 2 $ 100,067 $ - $ - Rental deposit to Daniel Shih $ 2,462 $ 2,542 $ 2,396 Loan from Dmedia 3 $ - $ 325,040 $ - Other payable to: Klingon 4 $ 762,000 $ 762,000 $ 762,000 Jeffrey Wun 6 46,236 - 22,327 Louis Giordimaina 6,071 135,973 - Daniel Shih 5 13,444 132,305 128,543 Yih Lieh (Giretsu) Shih 6 15,497 81,752 76,600 WWI 7 39,224 38,241 9,410 Others 6 66,826 149,307 83,515 Total $ 949,298 $ 1,299,578 $ 1,082,395 1. Represents receivable from Mr. Peng due to the transactions prior to the acquisition of Aircom Telecom on December 19, 2017. The amount is subsequently collected on January 4, 2018. 2. In November 2018, Aircom HK’s bank account was temporarily frozen by its local bank in Hong Kong (the “HK bank”) due to Aircom HK’s failure to timely submit to the HK bank corporate documentation relating to the corporate organization and goodstanding of Aircom HK’s parent company, Aircom, and Aircom’s parent company, Aerkomm. To avoid a potential cash flow issue resulting from this temporary account freeze, Aircom HK withdrew $100,067 in cash from the HK bank and temporarily deposited it in an existing related party’s bank account at a different bank for safe keeping. The Aircom HK’s bank account with the HK bank was reactivated by the HK bank subsequently and the cash that was transferred to the related party’s account was redeposited into Aircom HK’s bank account at the HK bank in February 2019. 3. Represents short-term loan from Dmedia. This short-term loan has an expiration date of January 30, 2019 and an annual interest rate of 3%. The Company repaid the short-term loan in full on June 14, 2018. 4. On March 9, 2015, the Company entered into a 10-year purchase agreement with Klingon. In accordance with the terms of this agreement, Klingon agreed to purchase from the Company an initial order of onboard equipment comprising an onboard system for a purchase price of $909,000, with payments to be made in accordance with a specific milestones schedule. As of December 31, 2018, the Company received $762,000 from Klingon in milestone payments towards the equipment purchase price. Since the project might not be successful, the Company reclassified the balance from customer prepayment to other payable due to uncertainty. 5. The amount as of March 31, 2018 represents payable to employees as a result of regular operating activities, while the amount as of December 31, 2018 represents rental payable. 6. Represents payable to employees as a result of regular operating activities. 7. Represents rent for a warehouse in Hong Kong to store the Company’s hardware and another rent for the Hong Kong office starting June 28, 2018. b. For the nine-month periods ended December 31, 2018 and 2017, three-month period ended March 31, 2018 and year ended December 31, 2018 and 2017: Nine Months Ended Three Months Ended Year Ended 2018 2017 2018 2018 2017 (Unaudited) Consulting expense paid to Louis Giordimaina $ 87,275 $ - $ 134,971 $ 222 ,246 $ - Consulting expense paid to Yun Shu Chiou - - - - 55,000 Legal expense paid to WISD 10,779 - - 10,779 - Rental expense charged by Daniel Shih 11,811 20,232 4,040 15,851 20,232 Rental expense charged by WWI 27,486 3,150 1,350 28,836 3,150 Interest expense charged by Dmedia 1,915 - 1,201 3,116 - On May 25, 2018, Mr. Louis Giordimaina was converted from a consultant to a full-time employee and was appointed as Chief Operating Officer – Aviation. The consulting expense paid for the year ended December 31, 2018 in the amount of $222,246 represents the consulting services provided prior to the conversion. Aircom Japan entered into a lease agreement with Daniel Shih, between August 1, 2014 and July 31, 2016, which was renewed on July 31, 2018. Pursuant to the terms of this lease agreement, Aircom Japan pays Daniel Shih a rental fee of approximately $1,200 per month. The lease will be expired on June 2020. Aircom engaged WISD to handle its filing of patent and trademark applications. The Company has a lease agreement with WWI with monthly rental cost of $450. The lease term was from June 1, 2017 to May 31, 2018 and the lease was not renewed. The Company has another lease agreement with WWI for its office space in Hong Kong with monthly rental cost of $3,833. The lease term is from June 28, 2018 to June 27, 2020. |
Stock Based Compensation
Stock Based Compensation | 12 Months Ended |
Dec. 31, 2018 | |
Stock Based Compensation [Abstract] | |
Stock Based Compensation | NOTE 13 - Stock Based Compensation In March 2014, Aircom’s Board of Directors adopted the 2014 Stock Option Plan (the “Aircom 2014 Plan”). The Aircom 2014 Plan provided for the granting of incentive stock options and non-statutory stock options to employees, consultants and outside directors of Aircom. On February 13, 2017, pursuant to the Exchange Agreement, Aerkomm assumed the options of Aircom 2014 Plan and agreed to issue options for an aggregate of 1,088,882 shares to Aircom’s stock option holders. One-third of stock option shares will be vested as of the first anniversary of the time the option shares are granted or the employee’s acceptance to serve the Company, and 1/36th of the shares will be vested each month thereafter. Option price is determined by the Board of Directors. The Aircom 2014 Plan became effective upon its adoption by the Board and shall continue in effect for a term of 10 years unless sooner terminated under the terms of Aircom 2014 Plan. On May 5, 2017, the Board of Directors of Aerkomm adopted the Aerkomm Inc. 2017 Equity Incentive Plan (the “Aerkomm 2017 Plan” and together with the Aircom 2015 Plan, the “Plans”)) and the reservation of 1,000,000 shares of common stock for issuance under the Aerkomm 2017 Plan. On June 23, 2017, the Board of Directors voted to increase the number of shares of common stock reserved for issuance under the Aerkomm 2017 Plan to 2,000,000 shares. The Aerkomm 2017 Plan provides for the granting of incentive stock options and non-statutory stock options to employees, consultants and outside directors of the Company, as determined by the Compensation Committee of the Board of Directors (or, prior to the establishment of the Compensation Committee on January 23, 2018, the Board of Directors). On June 23, 2017, the Board of Directors agreed to issue options for an aggregate of 291,000 shares under the Aerkomm 2017 Plan to certain officers and directors of the Company. The option agreements are classified into three types of vesting schedule, which includes, 1) 1/6 of the shares subject to the option shall vest commencing on the vesting start date and the remaining shares shall vest at the rate of 1/60 for the next 60 months on the same day of the month as the vesting start date; 2) 1/4 of the shares subject to the option shall vest commencing on the vesting start date and the remaining shares shall vest at the rate of 1/36 for the next 36 months on the same day of the month as the vesting start date; 3) 1/3 of the shares subject to the option shall vest commencing on the first anniversary of vesting start date and the remaining shares shall vest at the rate of 50% each year for the next two years on the same day of the month as the vesting start date. On July 31, 2017, the Board of Directors approved to issue options for an aggregate of 109,000 shares under the Aerkomm 2017 Plan to 11 of its employees. 1/3 of these shares subject to the option shall vest commencing on the first anniversary of vesting start date and the remaining shares shall vest at the rate of 50% each year for the next two years on the same day of the month as the vesting start date. On December 29, 2017, the Board of Directors approved to issue options for an aggregate of 12,000 shares under the Aerkomm 2017 Plan to three of the Company’s independent directors, 4,000 shares each. All of these options were vested immediately upon issuance. On June 19, 2018, the Compensation Committee approved to issue options for 32,000 and 30,000 shares under the Aerkomm 2017 Plan to two of the Company executives. One-fourth of the 32,000 shares subject to the option shall vest on May 1, 2019, 2020, 2021 and 2022, respectively. One-third of the 30,000 shares subject to the option shall vest on May 29, 2019, 2020 and 2021, respectively. On December 29, 2018, the Compensation Committee approved to issue options for an aggregate of 12,000 shares under the Aerkomm 2017 Plan to three of the Company’s independent directors, 4,000 shares each. All of these options were vested immediately upon issuance. Option price is determined by the Compensation Committee. The Aerkomm 2017 Plan has been adopted by the Board and shall continue in effect for a term of 10 years unless sooner terminated under the terms of Aerkomm 2017 Plan. The Aerkomm 2017 Plan was approved by the Company’s stockholders on March 28, 2018. Valuation and Expense Information Measurement and recognition of compensation expense based on estimated fair values is required for all share-based payment awards made to its employees and directors including employee stock options. The Company recognized compensation expense of $1,147,155 and $1,740,447 (unaudited) for the nine-month periods ended December 31, 2018 and 2017, respectively, and $275,806 for the three-month period ended March 31, 2018, and $1,422,961 and $1,749,447 for the years ended December 31, 2018 and 2017, respectively, related to such employee stock options. Determining Fair Value Valuation and amortization method The Company uses the Black-Scholes option-pricing-model to estimate the fair value of stock options granted on the date of grant or modification and amortizes the fair value of stock-based compensation at the date of grant on a straight-line basis for recognizing stock compensation expense over the vesting period of the option. Expected term The expected term is the period of time that granted options are expected to be outstanding. The Company uses the SEC’s simplified method for determining the option expected term based on the Company’s historical data to estimate employee termination and options exercised. Expected dividends The Company does not plan to pay cash dividends before the options are expired. Therefore, the expected dividend yield used in the Black-Scholes option valuation model is zero. Expected volatility Since the Company has no historical volatility, it used the calculated value method which substitutes the historical volatility of a public company in the same industry to estimate the expected volatility of the Company’s share price to measure the fair value of options granted under the Plans. Risk-free interest rate The Company based the risk-free interest rate used in the Black-Scholes option valuation model on the market yield in effect at the time of option grant provided in the Federal Reserve Board’s Statistical Releases and historical publications on the Treasury constant maturities rates for the equivalent remaining terms for the Plans. Forfeitures The Company is required to estimate forfeitures at the time of grant and revises those estimates in subsequent periods if actual forfeitures differ from those estimates. The Company uses historical data to estimate option forfeitures and records share-based compensation expense only for those awards that are expected to vest. The Company used the following assumptions to estimate the fair value of options granted in 2018 and 2017 under the Plans as follows: Assumptions Expected term 3 - 5 years Expected volatility 40.11% - 61.78 % Expected dividends 0 % Risk-free interest rate 0.71% - 2.99 % Forfeiture rate 0% - 5 % Aircom 2014 Plan A summary of the number of shares, weighted average exercise price and estimated fair value of options for Aircom 2014 Plan as of December 31, 2018, March 31, 2018 and December 31, 2017 was as follows: Number of Shares Weighted Average Exercise Price Per Share Weighted Average Fair Value Per Share Options outstanding at January 1, 2017 1,088,882 $ 0.8087 $ 0.2542 Granted - - - Exercised (3,936 ) 0.0067 0.0019 Forfeited/Cancelled (152,684 ) 3.2749 1.0296 Options outstanding at December 31, 2017 932,262 0.4081 0.1282 Granted - - - Exercised - - - Forfeited/Cancelled - - - Options outstanding at March 31, 2018 932,262 0.4081 0.1282 Granted - - - Exercised - - - Forfeited/Cancelled - - - Options outstanding at December 31, 2018 932,262 0.4081 0.1282 Options exercisable at December 31, 2017 629,795 0.2060 0.0645 Options exercisable at March 31, 2018 681,587 0.2200 0.0690 Options exercisable at December 31, 2018 846,287 0.3660 0.1150 A summary of the status of nonvested shares under Aircom 2014 Plan as of December 31, 2018, March 31, 2018 and December 31, 2017 was as follows: Number of Shares Weighted Average Exercise Price Per Share Options nonvested at January 1, 2017 675,510 $ 1.2985 Granted - - Vested (220,359 ) 0.5730 Forfeited/Cancelled (152,684 ) 3.2749 Options nonvested at December 31, 2017 302,467 0.8315 Granted - - Vested (51,792 ) 0.4080 Forfeited/Cancelled - - Options nonvested at March 31, 2018 250,675 0.9163 Granted - - Vested (164,700 ) 0.5748 Forfeited/Cancelled - - Options nonvested at December 31, 2018 85,975 0.7305 Aerkomm 2017 Plan A summary of the number of shares, weighted average exercise price and estimated fair value of options under Aerkomm 2017 Plan as of December 31, 2018, March 31, 2018 and December 31, 2018 was as follows: Number of Shares Weighted Average Exercise Price Per Share Weighted Average Fair Value Per Share Options outstanding at January 1, 2017 - $ - $ - Granted 412,000 29.5771 17.7006 Exercised - - - Forfeited/Cancelled (159,000 ) 27.5000 16.4610 Options outstanding at December 31, 2017 253,000 30.8825 17.5175 Granted - - - Exercised - - - Forfeited/Cancelled (48,000 ) 27.5000 16.4610 Options outstanding at March 31, 2018 205,000 31.6744 18.9522 Granted 78,000 19.7462 9.2500 Exercised - - - Forfeited/Cancelled - - - Options outstanding at December 31, 2018 283,000 28.3867 16.2781 Options exercisable at December 31, 2017 84,750 27.5840 17.0025 Options exercisable at March 31, 2018 40,875 28.2339 17.5839 Options exercisable at December 31, 2018 111,589 28.7052 16.5968 A summary of the status of nonvested shares under Aerkomm 2017 Plan as of December 31, 2018, March 31, 2018 and December 31, 2017 was as follows: Number of Shares Weighted Average Exercise Price Per Share Options nonvested at January 1, 2017 - $ - Granted 412,000 29.5771 Vested (84,750 ) 27.8540 Forfeited/Cancelled (159,000 ) 27.5000 Options nonvested at December 31, 2017 168,250 32.4080 Granted - - Vested (4,125 ) 27.5000 Forfeited/Cancelled - - Options nonvested at March 31, 2018 164,125 32.5312 Granted 78,000 19.7462 Vested (70,714 ) 28.9777 Forfeited/Cancelled - - Options nonvested at December 31, 2018 171,411 28.1794 As of December 31, 2018, March 31, 2018 and December 31, 2017, there were approximately $2,174,000, $1,756,000 and $5,057,000, respectively, of total unrecognized compensation cost related to nonvested share-based compensation arrangements granted under the Plans. Total unrecognized compensation cost will be adjusted for future changes in estimated forfeitures. The Company expects to recognize that cost over a weighted average period of 1 - 5 years. |
Commitments
Commitments | 12 Months Ended |
Dec. 31, 2018 | |
Commitments [Abstract] | |
Commitments | NOTE 14 - Commitments As of December 31, 2018, the Company’s significant commitments with unrelated parties and contingency are summarized as follows: 1) The Company’s lease for its office in Fremont, California expires in May 2020. Rental expense for the nine-month periods ended December 31, 2018 and 2017 was $58,014 and $54,653 (unaudited), respectively, and was $15,618, $73,632 and $71,152 for the three-month period ended March 31, 2018 and for the year ended December 31, 2018 and 2017, respectively. As of December 31, 2018, future minimum lease payment is $77,352 for the next twelve-month period ending December 31, 2019. 2) The Company has another lease for its Japan office expiring June 2020. Rental expense for the nine-month periods ended December 31, 2018 and 2017 was $28,578 and $30,475 (unaudited), respectively, and was $9,731, $38,309 and $55,043 for the three-month period ended March 31, 2018 and for the years ended December 31, 2018 and 2017, respectively. As of December 31, 2018, future minimum lease payment obligation is $35,572, including the 8% Japan consumption tax, for the next twelve-month period ending December 31, 2019. 3) The Company assumed a lease for its Taiwan office expiring October 31, 2018 as a result of the acquisition of Aircom Taiwan. Rental expense was approximately $66,589 and $0 for the nine-month periods ended December 31, 2018 and 2017, respectively, and was $0, $0 and $0 for the three-month period ended March 31, 2018 and for the years ended December 31, 2018 and 2017, respectively. Aircom Taiwan is currently negotiating a renewal on the contract although there can be no assurance that a renewal lease will be signed on terms acceptable to the Company if at all. As of December 31, 2018, future minimum lease payment obligation is estimated to be $88,206 for the next twelve-month period ending December 31, 2019. 4) The Company entered into a lease for its Hong Kong office on June 28, 2018, which expires on June 27, 2020. Rental expense for the nine-month periods ended December 31, 2018 was $26,550. As of December 31, 2018, future minimum lease payment is $45,974 for the next twelve-month period ending December 31, 2019. 5) On June 20, 2018, the Company entered into a Cooperation Framework Agreement with Shenzhen Yihe Culture Media Co., Ltd. (“Yihe”), the authorized agent of Guangdong Tengnan Internet, pursuant to which Yihe will promote the development of strategic cooperation between the Company and Guangdong Tengnan Internet. Specifically, Yihe agreed to assist the Company with public relations and advertising, such as market and brand promotion, as well as brand recognition in China (excluding Hong Kong, Macao and Taiwan), including but not limited to news dissemination, creative planning and support of campaigns, financial public relations and internet advertising. More specifically, Yihe will help the Company develop a working application of the WeChat Pay payment solution as well as WeChat applets applicable for Chinese users and relating to cell phone and WiFi connectivity on airplanes, and Yihe will assist the Company in integrating other Tencent internet-based original product offerings. As compensation, the Company agreed to pay Yihe RMB 8 million (approximately US$1.2 million), with RMB 2,000,000 (approximately US$309,000) paid on June 29, 2018 and the remaining RMB 6,000,000 (approximately US$927,000) to be paid by August 15, 2018. However, the Company is currently working with Yihe to postpone the project as well as the remaining payment, although there can be no assurance that a postponement will be agreed upon on terms acceptable to the Company if at all. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 15 - Subsequent Events Reverse Split On January 16, 2019, the Company completed a 1-for-5 reverse split of the Company’s issued and outstanding shares of common stock (the “Reverse Split”), which was completed by the filing of a Certificate of Change Pursuant to NRS 78.209 (the “Certificate of Change”) with the Nevada Secretary of State on December 26, 2018. All of the references in these financial statements to authorized common stock and issued and outstanding common stock reflect the Reverse Split. The Reverse Split was duly approved by the Board of Directors of the Company without stockholder approval, in accordance with the authority conferred by Section 78.207 of the Nevada Revised Statutes. The Certificate of Change also decreased the authorized number of shares of the Company’s common stock from 450,000,000 shares to 90,000,000 shares, effective as of December 26, 2018. Pursuant to the Reverse Split, holders of the Company’s common stock are deemed to hold one (1) post-split share of the Company’s common stock for every five (5) shares of the Company’s common stock held. No fractional shares were issued in connection with the Reverse Split. Stockholders entitled to a fractional post-split share received in lieu thereof one (1) whole post-split share. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Summary of Significant Accounting Policies [Abstract] | |
Changes in Fiscal Year | Changes in Fiscal Year On March 18, 2018, the Company’s Board of Directors approved a change in the Company’s fiscal year end from December 31 to March 31. Year-over-year quarterly financial data continue to be comparative to prior periods as the three months that comprise each fiscal quarter in the new fiscal year are the same as those in the Company’s historical financial statements. On February 12, 2019, the Company’s Board of Directors approved a change in the Company’s fiscal year end from March 31 to December 31. Year-over-year quarterly financial data continue to be comparative to prior periods as the nine months that comprise each fiscal quarter in the new fiscal year are the same as those in the Company’s historical financial statements. |
Principle of Consolidation | Principle of Consolidation Aerkomm consolidates the accounts of its subsidiaries, Aircom, Aircom Seychelles, Aircom HK, Aircom Japan, Aircom Taiwan, Aerkomm Taiwan and Aircom Beijing. All significant intercompany accounts and transactions have been eliminated in consolidation. |
Reclassifications of Prior Period Presentation | Reclassifications of Prior Period Presentation Certain prior period balance sheet and income statement amounts have been reclassified for consistency with the current period presentation. These reclassifications had no effect on the reported results of operations. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results may differ from these estimates. |
Concentrations of Credit Risk | Concentrations of Credit Risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash in banks. As of December 31, 2018, all cash in bank was fully insured by the Federal Deposit Insurance Corporation (FDIC) for the Company and there is no balance of cash deposited in foreign bank exceeded the amount insured by local deposit insurance. The Company performs ongoing credit evaluation of its customers and requires no collateral. An allowance for doubtful accounts is provided based on a review of the collectability of accounts receivable. The Company determines the amount of allowance for doubtful accounts by examining its historical collection experience and current trends in the credit quality of its customers as well as its internal credit policies. Actual credit losses may differ from management’s estimates. |
Inventories | Inventories Inventories are recorded at the lower of weighted-average cost or net realizable value. The Company assesses the impact of changing technology on its inventory on hand and writes off inventories that are considered obsolete. Estimated losses on scrap and slow-moving items are recognized in the allowance for losses. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost less accumulated depreciation. When value impairment is determined, the related assets are stated at the lower of fair value or book value. Significant additions, renewals and betterments are capitalized. Maintenance and repairs are expensed as incurred. Depreciation is computed by using the straight-line and double declining methods over the following estimated service lives: ground station equipment – 5 years, computer equipment - 3 to 5 years, furniture and fixtures - 5 years, satellite equipment – 5 years, vehicles – 5 years and lease improvement – 5 years. Construction costs for on-flight entertainment equipment not yet in service are recorded under construction in progress. Upon sale or disposal of property and equipment, the related cost and accumulated depreciation are removed from the corresponding accounts, with any gain or loss credited or charged to income in the period of sale or disposal. The Company reviews the carrying amount of property and equipment for impairment when events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. It determined that there was no impairment loss for the nine-month periods ended December 31, 2018 and 2017. |
Goodwill and Purchased Intangible Assets | Goodwill and Purchased Intangible Assets The Company’s goodwill represents the amount by which the total purchase price paid exceeded the estimated fair value of net assets acquired from acquisition of subsidiaries. The Company tests goodwill for impairment on an annual basis, or more often if events or circumstances indicate that there may be impairment. Purchased intangible assets with finite life are amortized on the straight-line basis over the estimated useful lives of respective assets. Purchased intangible assets with indefinite life are evaluated for impairment when events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Purchased intangible asset consists of satellite system software and is amortized over 10 years. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company utilizes the three-level valuation hierarchy for the recognition and disclosure of fair value measurements. The categorization of assets and liabilities within this hierarchy is based upon the lowest level of input that is significant to the measurement of fair value. The three levels of the hierarchy consist of the following: Level 1 - Inputs to the valuation methodology are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. Level 2 - Inputs to the valuation methodology are quoted prices for similar assets and liabilities in active markets, quoted prices in markets that are not active or inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the instrument. Level 3 - Inputs to the valuation methodology are unobservable inputs based upon management’s best estimate of inputs market participants could use in pricing the asset or liability at the measurement date, including assumptions. The carrying amounts of the Company’s cash, accounts receivable, other receivable, short-term bank loan and other payable approximated their fair value due to the short-term nature of these financial instruments. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue when performance obligations identified under the terms of contracts with its customers are satisfied, which generally occurs upon the transfer of control in accordance with the contractual terms and conditions of the sale. The Company’s major revenue for the nine-month period and the year ended December 31, 2018 was the development of a small cell server terminal which will be utilized in the construction of a satellite-based ground communication system networks. The Company also had minor revenue from providing installation and testing services of a satellite-based ground connectivity system. The majority of the Company’s revenue is recognized at a point in time when product is shipped or service is provided to the customer. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring goods, which includes estimates for variable consideration. |
Research and Development Costs | Research and Development Costs Research and development costs are charged to operating expenses as incurred. For the nine-month periods ended December 31, 2018 and 2017, the three-month period ended March 31, 2018 and the years ended December 31, 2018 and 2017 the Company incurred $1,451,202, $366,047, $90,750 (unaudited), $1,541,952 and $336,000 of research and development costs, respectively. |
Income Taxes | Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are computed for differences between the financial statement and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Income tax expense is the tax payable or refundable for the period plus or minus the change during the period in deferred tax assets and liabilities. Adjustments to prior period’s income tax liabilities are added to or deducted from the current period’s tax provision. The Company follows FASB guidance on uncertain tax positions and has analyzed its filing positions in all the federal, state and foreign jurisdictions where it is required to file income tax returns, as well as all open tax years in those jurisdictions. The Company files income tax returns in the US federal, state and foreign jurisdictions where it conducts business. The Company believes that its income tax filing positions and deductions will be sustained on audit and does not anticipate any adjustments that will result in a material adverse effect on its consolidated financial position, results of operations, or cash flows. Therefore, no reserves for uncertain tax positions have been recorded. The Company does not expect its unrecognized tax benefits to change significantly over the next twelve months. The Company’s policy for recording interest and penalties associated with any uncertain tax positions is to record such items as a component of income before taxes. Penalties and interest paid or received, if any, are recorded as part of other operating expenses in the consolidated statement of operations. Research and Development Costs Research and development costs are charged to operating expenses as incurred. For the nine-month periods ended December 31, 2018 and 2017, the three-month period ended March 31, 2018 and the years ended December 31, 2018 and 2017 the Company incurred $1,451,202, $366,047, $90,750 (unaudited), $1,541,952 and $336,000 of research and development costs, respectively. |
Translation Adjustments | Translation Adjustments If a foreign subsidiary’s functional currency is the local currency, translation adjustments will result from the process of translating the subsidiary’s financial statements into the reporting currency of the Company. Such adjustments are accumulated and reported under other comprehensive income (loss) as a separate component of stockholders’ equity. |
Earnings (Loss) Per Share | Earnings (Loss) Per Share Basic earnings (loss) per share is computed by dividing income available to common shareholders by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share is computed by dividing income available to common shareholders by the weighted-average number of shares of common outstanding during the period increased to include the number of additional shares of common stock that would have been outstanding if the potentially dilutive securities had been issued. Potentially dilutive securities include stock warrants and outstanding stock options, shares to be purchased by employees under the Company’s employee stock purchase plan. |
Subsequent Events | Subsequent Events The Company has evaluated events and transactions after the reported period up to March 22, 2019, the date on which these consolidated financial statements were available to be issued. All subsequent events requiring recognition as of December 31, 2018 have been included in these consolidated financial statements. |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Inventories [Abstract] | |
Schedule of inventories | December 31, March 31, December 31, Satellite equipment for sale under construction $ - $ 197,645 $ 197,645 Parts - 11,029 11,029 Supplies 5,273 5,468 5,540 5,273 214,142 214,214 Allowance for inventory loss (5,273 ) (5,468 ) (5,540 ) Net $ - $ 208,674 $ 208,674 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Property and Equipment [Abstract] | |
Schedule of property and equipment | Computer Furniture and fixture Satellite Ground station equipment Vehicle Leasehold Improvement Total January 1, 2017 $ 118,911 $ 10,006 $ - $ - $ - $ - $ 128,917 Addition 992 - 275,410 - - - 276,402 December 31, 2017 119,903 10,006 275,410 - - - 405,319 Addition 2,182 - - - - - 2,182 March 31, 2018 122,085 10,006 275,410 - - - 407,501 Addition 198,985 23,338 - 1,854,027 141,971 89,721 2,308,042 December 31, 2018 $ 321,070 $ 33,344 $ 275,410 $ 1,854,027 $ 141,971 $ 89,721 $ 2,715,543 |
Schedule of changes in accumulated depreciation for property and equipment | Computer Furniture and fixture Satellite Ground station equipment Vehicle Leasehold Improvement Total January 1, 2017 $ 39,604 $ 4,221 $ - $ - $ - $ - $ 43,825 Addition 17,159 1,997 37,611 - - - 56,767 December 31, 2017 56,763 6,218 37,611 - - - 100,592 Addition 6,275 477 12,438 - - - 19,190 March 31, 2018 63,038 6,695 50,049 - - - 119,782 Addition 38,091 2,676 41,311 92,701 21,980 5,508 202,267 December 31, 2018 $ 101,129 $ 9,371 $ 91,360 $ 92,701 $ 21,980 $ 5,508 $ 322,049 |
Intangible Asset, Net (Tables)
Intangible Asset, Net (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Intangible Asset, Net [Abstract] | |
Schedule of cost and accumulated amortization for intangible asset | Satellite Accumulated amortization Net Cost January 1, 2017 $ 4,950,000 $ 577,500 $ 4,372,500 Addition - 495,000 (495,000 ) December 31, 2017 4,950,000 1,072,500 3,877,500 Addition - 123,750 (123,750 ) March 31, 2018 4,950,000 1,196,250 3,753,750 Addition - 371,250 (371,250 ) December 31, 2018 $ 4,950,000 $ 1,567,500 $ 3,382,500 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Taxes [Abstract] | |
Schedule of income tax expense | Nine Months Ended Three Months Ended Year Ended December 31, 2018 2017 2018 2018 2017 Current: (Unaudited) Federal $ 61 $ 3,033 $ - $ 61 $ 3,033 State - - 2,400 2,400 800 Foreign - 3,101 1,662 1,662 4,686 Total $ 61 $ 6,134 $ 4,062 $ 4,123 $ 8,519 |
Schedule of reconciliation of the income tax at statutory tax rate | Nine Months Ended Three Months Ended Year Ended 2018 2017 2018 2018 2017 (Unaudited) Tax benefit at statutory rate $ (1,404,700 ) $ (2,082,820 ) $ (294,826 ) $ (1,699,526 ) $ (2,292,820 ) Net operating loss carryforwards (NOLs) 1,311,500 1,484,000 172,225 1,483,725 1,760,600 Stock-based compensation expense 240,900 594,800 57,919 298,819 594,800 Amortization expense (38,400 30,700 (1,700 ) (40,100 ) (11,200 ) Accrued R&D expense (168,000 ) - - (168,000 ) - Others 58,761 (20,546 ) 70,444 129,205 (42,861 ) Tax expense at effective tax rate $ 61 $ 6,134 $ 4,062 $ 4,123 $ 8,519 |
Schedule of deferred tax assets (liability) | December 31, March 31, December 31, 2017 Net operating loss carryforwards (NOLs) $ 5,632,000 $ 2,339,000 $ 2,057,000 Stock-based compensation expense 893,000 566,000 489,000 Accrued expenses and unpaid payable 184,000 268,000 443,000 Tax credit carryforwards 68,000 68,000 68,000 Excess of tax amortization over book amortization (818,000 ) (635,000 ) (658,000 ) Others 131,000 235,000 - Gross 6,090,000 2,841,000 2,399,000 Valuation allowance (6,090,000 ) (2,841,000 ) (2,399,000 ) Net $ - $ - $ - |
Capital Stock (Tables)
Capital Stock (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Capital Stock [Abstract] | |
Schedule of restricted shares | December 31, March 31, December 31, Restricted stock - vested 1,802,373 2,053,875 2,047,661 Restricted stock - unvested 149,162 2,072 8,286 Total restricted stock 1,951,535 2,055,947 2,055,947 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
Schedule of name of related parties and relationships | Related Party Relationship Daniel Shih* Co-founder and former stockholder; Aircom’s CEO and Director between February 13, 2017 and April 26, 2017; Aircom’s CFO between February 13, 2017 and May 5, 2017 Dmedia Holding LP (“Dmedia”) 23.99% stockholder Bummy Wu Shareholder Jeffrey Wun Shareholder and CEO of Aerkomm and Aircom Yih Lieh (Giretsu) Shih President of Aircom Japan Hao Wei Peng Employee of Aircom Taiwan and founding owner of Aircom Taiwan prior to 12/19/2017 Louis Giordimaina COO - Aviation of Aircom Klingon Aerospace, Inc. (“Klingon”) Daniel Shih was the Chairman from February 2015 to February 2016 Wealth Wide Int’l Ltd. (“WWI”) Bummy Wu, a shareholder, is the Chairman WISD Intellectual Property Agency, Ltd. (“WISD”) Patrick Li, Director of Aircom, is the Chairman; Chih-Ming (Albert) Hsu, Director of the Company, is a Director Yun Shu Chiou Former CEO and President prior to December 31, 2017 * Daniel Shih has relinquished “beneficial ownership” of substantially all of his equity interests in the Company (whether held directly or indirectly) in a manner acceptable to the Company. This means that Daniel Shih no longer, directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise has or shares (i) voting power, which includes the power to vote, or to direct the voting of, securities, and/or (ii) investment power, which includes the power to dispose, or to direct the disposition of, shares of the Company’s common stock, except for a de minimus |
Schedule of significant related party transactions | December 31, March 31, December 31, Other receivable from Hao Wei Peng 1 $ - $ - $ 46,743 Temporary deposit to Bummy Wu 2 $ 100,067 $ - $ - Rental deposit to Daniel Shih $ 2,462 $ 2,542 $ 2,396 Loan from Dmedia 3 $ - $ 325,040 $ - Other payable to: Klingon 4 $ 762,000 $ 762,000 $ 762,000 Jeffrey Wun 6 46,236 - 22,327 Louis Giordimaina 6,071 135,973 - Daniel Shih 5 13,444 132,305 128,543 Yih Lieh (Giretsu) Shih 6 15,497 81,752 76,600 WWI 7 39,224 38,241 9,410 Others 6 66,826 149,307 83,515 Total $ 949,298 $ 1,299,578 $ 1,082,395 1. Represents receivable from Mr. Peng due to the transactions prior to the acquisition of Aircom Telecom on December 19, 2017. The amount is subsequently collected on January 4, 2018. 2. In November 2018, Aircom HK’s bank account was temporarily frozen by its local bank in Hong Kong (the “HK bank”) due to Aircom HK’s failure to timely submit to the HK bank corporate documentation relating to the corporate organization and goodstanding of Aircom HK’s parent company, Aircom, and Aircom’s parent company, Aerkomm. To avoid a potential cash flow issue resulting from this temporary account freeze, Aircom HK withdrew $100,067 in cash from the HK bank and temporarily deposited it in an existing related party’s bank account at a different bank for safe keeping. The Aircom HK’s bank account with the HK bank was reactivated by the HK bank subsequently and the cash that was transferred to the related party’s account was redeposited into Aircom HK’s bank account at the HK bank in February 2019. 3. Represents short-term loan from Dmedia. This short-term loan has an expiration date of January 30, 2019 and an annual interest rate of 3%. The Company repaid the short-term loan in full on June 14, 2018. 4. On March 9, 2015, the Company entered into a 10-year purchase agreement with Klingon. In accordance with the terms of this agreement, Klingon agreed to purchase from the Company an initial order of onboard equipment comprising an onboard system for a purchase price of $909,000, with payments to be made in accordance with a specific milestones schedule. As of December 31, 2018, the Company received $762,000 from Klingon in milestone payments towards the equipment purchase price. Since the project might not be successful, the Company reclassified the balance from customer prepayment to other payable due to uncertainty. 5. The amount as of March 31, 2018 represents payable to employees as a result of regular operating activities, while the amount as of December 31, 2018 represents rental payable. 6. Represents payable to employees as a result of regular operating activities. 7. Represents rent for a warehouse in Hong Kong to store the Company’s hardware and another rent for the Hong Kong office starting June 28, 2018. |
Schedule of expenses paid by related party | Nine Months Ended Three Months Ended March 31, Year Ended 2018 2017 2018 2018 2017 (Unaudited) Consulting expense paid to Louis Giordimaina $ 87,275 $ - $ 134,971 $ 222 ,246 $ - Consulting expense paid to Yun Shu Chiou - - - - 55,000 Legal expense paid to WISD 10,779 - - 10,779 - Rental expense charged by Daniel Shih 11,811 20,232 4,040 15,851 20,232 Rental expense charged by WWI 27,486 3,150 1,350 28,836 3,150 Interest expense charged by Dmedia 1,915 - 1,201 3,116 - |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of estimate the fair value of options granted | Assumptions Expected term 3 - 5 years Expected volatility 40.11% - 61.78 % Expected dividends 0 % Risk-free interest rate 0.71% - 2.99 % Forfeiture rate 0% - 5 % |
Aircom 2014 Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of weighted average exercise price and estimated fair value of options | Number of Shares Weighted Average Exercise Price Per Share Weighted Average Fair Value Per Share Options outstanding at January 1, 2017 1,088,882 $ 0.8087 $ 0.2542 Granted - - - Exercised (3,936 ) 0.0067 0.0019 Forfeited/Cancelled (152,684 ) 3.2749 1.0296 Options outstanding at December 31, 2017 932,262 0.4081 0.1282 Granted - - - Exercised - - - Forfeited/Cancelled - - - Options outstanding at March 31, 2018 932,262 0.4081 0.1282 Granted - - - Exercised - - - Forfeited/Cancelled - - - Options outstanding at December 31, 2018 932,262 0.4081 0.1282 Options exercisable at December 31, 2017 629,795 0.2060 0.0645 Options exercisable at March 31, 2018 681,587 0.2200 0.0690 Options exercisable at December 31, 2018 846,287 0.3660 0.1150 |
Schedule of nonvested shares | Number of Shares Weighted Average Exercise Price Per Share Options nonvested at January 1, 2017 675,510 $ 1.2985 Granted - - Vested (220,359 ) 0.5730 Forfeited/Cancelled (152,684 ) 3.2749 Options nonvested at December 31, 2017 302,467 0.8315 Granted - - Vested (51,792 ) 0.4080 Forfeited/Cancelled - - Options nonvested at March 31, 2018 250,675 0.9163 Granted - - Vested (164,700 ) 0.5748 Forfeited/Cancelled - - Options nonvested at December 31, 2018 85,975 0.7305 |
Aerkomm 2017 Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of weighted average exercise price and estimated fair value of options | Number of Shares Weighted Average Exercise Price Per Share Weighted Average Fair Value Per Share Options outstanding at January 1, 2017 - $ - $ - Granted 412,000 29.5771 17.7006 Exercised - - - Forfeited/Cancelled (159,000 ) 27.5000 16.4610 Options outstanding at December 31, 2017 253,000 30.8825 17.5175 Granted - - - Exercised - - - Forfeited/Cancelled (48,000 ) 27.5000 16.4610 Options outstanding at March 31, 2018 205,000 31.6744 18.9522 Granted 78,000 19.7462 9.2500 Exercised - - - Forfeited/Cancelled - - - Options outstanding at December 31, 2018 283,000 28.3867 16.2781 Options exercisable at December 31, 2017 84,750 27.5840 17.0025 Options exercisable at March 31, 2018 40,875 28.2339 17.5839 Options exercisable at December 31, 2018 111,589 28.7052 16.5968 |
Schedule of nonvested shares | Number of Shares Weighted Average Exercise Price Per Share Options nonvested at January 1, 2017 - $ - Granted 412,000 29.5771 Vested (84,750 ) 27.8540 Forfeited/Cancelled (159,000 ) 27.5000 Options nonvested at December 31, 2017 168,250 32.4080 Granted - - Vested (4,125 ) 27.5000 Forfeited/Cancelled - - Options nonvested at March 31, 2018 164,125 32.5312 Granted 78,000 19.7462 Vested (70,714 ) 28.9777 Forfeited/Cancelled - - Options nonvested at December 31, 2018 171,411 28.1794 |
Organization (Details)
Organization (Details) | Jan. 16, 2019 | Feb. 13, 2017 | Dec. 28, 2016shares | Mar. 31, 2018USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 19, 2017USD ($) | Dec. 19, 2017TWD ($) | Dec. 31, 2016USD ($) |
Organization (Textual) | |||||||||||
Stock purchase agreement | shares | 140,000 | ||||||||||
Common stock shares | 99.70% | 86.30% | |||||||||
Working capital deficiency | $ 2,541,500 | $ 2,541,500 | |||||||||
Total owners equity | $ 5,356,329 | 41,419,734 | $ 6,454,063 | 41,419,734 | $ 6,454,063 | $ 5,862,318 | |||||
Comprehensive loss | $ (1,456,249) | $ (6,568,663) | (6,241,511) | $ (8,024,912) | (7,135,918) | ||||||
Subsequent Event [Member] | |||||||||||
Organization (Textual) | |||||||||||
Reverse stock split, description | The Company completed a 1-for-5 reverse split of the Company's issued and outstanding shares of common stock (the "Reverse Split"), which was completed by the filing of a Certificate of Change Pursuant to NRS 78.209 (the "Certificate of Change") with the Nevada Secretary of State on December 26, 2018. | ||||||||||
Aerkomm [Member] | |||||||||||
Organization (Textual) | |||||||||||
Acquisition, description | On February 13, 2017, Aerkomm entered into a share exchange agreement ("Exchange Agreement") with Aircom and its shareholders, pursuant to which Aerkomm acquired 100% of the issued and outstanding capital stock of Aircom in exchange for approximately 99.7% of the issued and outstanding capital stock of Aerkomm (or 87.81% on a fully-diluted basis). As a result of the share exchange, Aircom became a wholly-owned subsidiary of Aerkomm, and the former shareholders of Aircom became the holders of approximately 99.7% of Aerkomm's issued and outstanding capital stock. | ||||||||||
Common stock shares | 100.00% | ||||||||||
Aircom [Member] | |||||||||||
Organization (Textual) | |||||||||||
Common stock shares | 99.70% | ||||||||||
Aggregate initial equity investment | 1,500,000 | 1,500,000 | $ 500,000 | $ 15,150,000 | |||||||
Total owners equity | $ 3,350 | $ 100,000 | |||||||||
Advances to affiliate | $ 460,000 | $ 460,000 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | |
Summary of Significant Accounting Policies (Textual) | |||||
Purchased intangible asset consists of satellite system software and is amortized, useful life | 10 years | ||||
Research and development costs | $ 90,750 | $ 1,451,202 | $ 366,047 | $ 1,541,952 | $ 336,000 |
Ground station equipment [Member] | |||||
Summary of Significant Accounting Policies (Textual) | |||||
Property and equipment, useful life | 5 years | ||||
Computer equipment [Member] | Minimum [Member] | |||||
Summary of Significant Accounting Policies (Textual) | |||||
Property and equipment, useful life | 3 years | ||||
Computer equipment [Member] | Maximum [Member] | |||||
Summary of Significant Accounting Policies (Textual) | |||||
Property and equipment, useful life | 5 years | ||||
Furniture and fixtures [Member] | |||||
Summary of Significant Accounting Policies (Textual) | |||||
Property and equipment, useful life | 5 years | ||||
Satellite Equipment [Member] | |||||
Summary of Significant Accounting Policies (Textual) | |||||
Property and equipment, useful life | 5 years | ||||
Vehicles [Member] | |||||
Summary of Significant Accounting Policies (Textual) | |||||
Property and equipment, useful life | 5 years | ||||
Lease improvement [Member] | |||||
Summary of Significant Accounting Policies (Textual) | |||||
Property and equipment, useful life | 5 years |
Inventories (Details)
Inventories (Details) - USD ($) | Dec. 31, 2018 | Mar. 31, 2018 | Dec. 31, 2017 |
Inventories [Abstract] | |||
Satellite equipment for sale under construction | $ 197,645 | $ 197,645 | |
Parts | 11,029 | 11,029 | |
Supplies | 5,273 | 5,468 | 5,540 |
Gross | 5,273 | 214,142 | 214,214 |
Allowance for inventory loss | (5,273) | (5,468) | (5,540) |
Net | $ 208,674 | $ 208,674 |
Inventories (Details Textual)
Inventories (Details Textual) | Dec. 31, 2018USD ($) |
Inventories (Textual) | |
Transferred inventories amount to R&D expenses | $ 11,029 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment [Line Items] | |||
Beginning balance | $ 405,319 | $ 407,501 | $ 128,917 |
Addition | 2,182 | 2,308,042 | 276,402 |
Ending balance | 407,501 | 2,715,543 | 405,319 |
Computer software and equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Beginning balance | 119,903 | 122,085 | 118,911 |
Addition | 2,182 | 198,985 | 992 |
Ending balance | 122,085 | 321,070 | 119,903 |
Furniture and fixture [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Beginning balance | 10,006 | 10,006 | 10,006 |
Addition | 23,338 | ||
Ending balance | 10,006 | 33,344 | 10,006 |
Satellite Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Beginning balance | 275,410 | 275,410 | |
Addition | 275,410 | ||
Ending balance | 275,410 | 275,410 | 275,410 |
Ground station equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Beginning balance | |||
Addition | 1,854,027 | ||
Ending balance | 1,854,027 | ||
Vehicle [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Beginning balance | |||
Addition | 141,971 | ||
Ending balance | 141,971 | ||
Leasehold Improvement [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Beginning balance | |||
Addition | 89,721 | ||
Ending balance | $ 89,721 |
Property and Equipment (Detai_2
Property and Equipment (Details 1) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment [Line Items] | |||
Beginning balance | $ 100,592 | $ 119,782 | $ 43,825 |
Addition | 19,190 | 202,267 | 56,767 |
Ending balance | 119,782 | 322,049 | 100,592 |
Computer software and equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Beginning balance | 56,763 | 63,038 | 39,604 |
Addition | 6,275 | 38,091 | 17,159 |
Ending balance | 63,038 | 101,129 | 56,763 |
Furniture and fixture [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Beginning balance | 6,218 | 6,695 | 4,221 |
Addition | 477 | 2,676 | 1,997 |
Ending balance | 6,695 | 9,371 | 6,218 |
Satellite Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Beginning balance | 37,611 | 50,049 | |
Addition | 12,438 | 41,311 | 37,611 |
Ending balance | 50,049 | 91,360 | 37,611 |
Ground station equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Beginning balance | |||
Addition | 92,701 | ||
Ending balance | 92,701 | ||
Vehicle [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Beginning balance | |||
Addition | 21,980 | ||
Ending balance | 21,980 | ||
Leasehold Improvement [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Beginning balance | |||
Addition | 5,508 | ||
Ending balance | $ 5,508 |
Property and Equipment (Detai_3
Property and Equipment (Details Textual) - USD ($) | 1 Months Ended | |||
May 01, 2018 | Dec. 31, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | |
Property and Equipment (Textual) | ||||
Construction in progress - Beginning | $ 3,660,000 | |||
Construction in progress to other receivable | 410,000 | |||
Transferred construction in progress amount to R&D expenses | $ 721,799 | |||
Construction in progress | 1,311,245 | $ 3,254,170 | $ 3,250,000 | |
Ground station equipment | $ 1,854,027 | |||
Tsai Ming-Yin [Member] | ||||
Property and Equipment (Textual) | ||||
Acquisition, description | The land is expected to be used to build a satellite ground station and data center. On July 10, 2018, the Company, Aerkomm Taiwan and the Seller entered into a certain real estate sales contract regarding this acquisition. Pursuant to the terms of the contract, and subsequent amendments on July 30, 2018, September 4, 2018, November 2, 2018 and January 3, 2019, the Company paid to the seller in installments refundable prepayment of $33.85 million as of December 31, 2018. The remaining amount of the purchase price, $624,462, which may also be paid in installments, must be paid in full by the Company and Aerkomm Taiwan in cash before January 4, 2019, which was subsequently extended to July 4, 2019. As of December 31, 2018, the estimated commission payable for the land purchase in the amount of $1,387,127 was recorded to the cost of land. |
Intangible Asset, Net (Details)
Intangible Asset, Net (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Intangible Asset Net [Line Items] | |||
Beginning balance | $ 3,877,500 | $ 3,753,750 | $ 4,372,500 |
Addition | (123,750) | (371,250) | (495,000) |
Ending balance | 3,753,750 | 3,382,500 | 3,877,500 |
Satellite System software [Member] | |||
Intangible Asset Net [Line Items] | |||
Beginning balance | 4,950,000 | 4,950,000 | 4,950,000 |
Addition | |||
Ending balance | 4,950,000 | 4,950,000 | 4,950,000 |
Accumulated amortization [Member] | |||
Intangible Asset Net [Line Items] | |||
Beginning balance | 1,072,500 | 1,196,250 | 577,500 |
Addition | 123,750 | 371,250 | 495,000 |
Ending balance | $ 1,196,250 | $ 1,567,500 | $ 1,072,500 |
Short-Term Bank Loan (Details)
Short-Term Bank Loan (Details) - Short-term bank credit [Member] | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Short-Term Bank Loan (Textual) | |
Short-term bank credit line | $ 10,000 |
Maturity date | Jun. 14, 2018 |
Annual interest rate | 4.75% |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | |
Current: | |||||
Federal | $ 61 | $ 3,033 | $ 61 | $ 3,033 | |
State | 2,400 | 2,400 | 800 | ||
Foreign | 1,662 | 3,101 | 1,662 | 4,686 | |
Total | $ 4,062 | $ 61 | $ 6,134 | $ 4,123 | $ 8,519 |
Income Taxes (Details 1)
Income Taxes (Details 1) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Taxes [Abstract] | |||||
Tax benefit at statutory rate | $ (294,826) | $ (1,404,700) | $ (2,082,820) | $ (1,699,526) | $ (2,292,820) |
Net operating loss carryforwards (NOLs) | 172,225 | 1,311,500 | 1,484,000 | 1,483,725 | 1,760,600 |
Stock-based compensation expense | 57,919 | 240,900 | 594,800 | 298,819 | 594,800 |
Amortization expense | (1,700) | (38,400) | 30,700 | (40,100) | (11,200) |
Accrued R&D expense | (168,000) | (168,000) | |||
Others | 70,444 | 58,761 | (20,546) | 129,205 | (42,861) |
Tax expense at effective tax rate | $ 4,062 | $ 61 | $ 6,134 | $ 4,123 | $ 8,519 |
Income Taxes (Details 2)
Income Taxes (Details 2) - USD ($) | Dec. 31, 2018 | Mar. 31, 2018 | Dec. 31, 2017 |
Income Taxes [Abstract] | |||
Net operating loss carryforwards (NOLs) | $ 5,632,000 | $ 2,339,000 | $ 2,057,000 |
Stock-based compensation expense | 893,000 | 566,000 | 489,000 |
Accrued expenses and unpaid payable | 184,000 | 268,000 | 443,000 |
Tax credit carryforwards | 68,000 | 68,000 | 68,000 |
Excess of tax amortization over book amortization | (818,000) | (635,000) | (658,000) |
Others | 131,000 | 235,000 | |
Gross | 6,090,000 | 2,841,000 | 2,399,000 |
Valuation allowance | (6,090,000) | (2,841,000) | (2,399,000) |
Net |
Income Taxes (Details Textual)
Income Taxes (Details Textual) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Taxes (Textual) | ||||
Change in deferred tax assets valuation allowance | $ 442,000 | $ 3,249,000 | ||
Additional federal net operating loss | 957,000 | $ 12,515,000 | ||
Federal research and development tax credit [Member] | ||||
Income Taxes (Textual) | ||||
Research and development tax credit | 37,000 | $ 37,000 | 37,000 | $ 37,000 |
Expiring date, description | The credit begins to expire in 2034 if not utilized. | |||
California state research and development tax credit [Member] | ||||
Income Taxes (Textual) | ||||
Research and development tax credit | 39,000 | $ 39,000 | 39,000 | 39,000 |
State [Member] | ||||
Income Taxes (Textual) | ||||
Net operating loss | 8,985,000 | 21,049,000 | $ 21,049,000 | 7,897,000 |
Expiring date, description | Expiring in 2038. | |||
Federal [Member] | ||||
Income Taxes (Textual) | ||||
Net operating loss | 6,686,000 | 6,686,000 | $ 6,686,000 | 6,686,000 |
Expiring date, description | Expiring in 2037. | |||
Japan [Member] | ||||
Income Taxes (Textual) | ||||
Net operating loss | 339,000 | $ 319,000 | $ 319,000 | 326,000 |
Expiring date, description | expiring in 2028 | |||
Taiwan [Member] | ||||
Income Taxes (Textual) | ||||
Net operating loss | $ 0 | $ 253,000 | $ 253,000 | $ 0 |
Expiring date, description | Expiring in 2028. |
Capital Stock (Details)
Capital Stock (Details) - Restricted Stock [Member] - shares | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Restricted stock - vested | 2,053,875 | 1,802,373 | 2,047,661 |
Restricted stock - unvested | 2,072 | 149,162 | 8,286 |
Total restricted stock | 2,055,947 | 1,951,535 | 2,055,947 |
Capital Stock (Details Textual)
Capital Stock (Details Textual) - USD ($) | Dec. 21, 2018 | May 14, 2018 | Jul. 05, 2017 | Jun. 06, 2017 | Jun. 30, 2018 | Nov. 30, 2017 | Oct. 31, 2017 | Aug. 31, 2017 | Jul. 31, 2017 | Mar. 31, 2017 | Feb. 13, 2017 | Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 |
Capital Stock (Textual) | ||||||||||||||
Preferred stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | |||||||||||
Preferred stock, authorized | 50,000,000 | 50,000,000 | 50,000,000 | |||||||||||
Preferred stock, outstanding | ||||||||||||||
Common stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | |||||||||||
Common stock, authorized | 90,000,000 | 90,000,000 | 90,000,000 | |||||||||||
Unvested per shares of restricted stock repurchased and cancelled | $ 0.0067 | |||||||||||||
Unvested Restricted stock shares repurchased and cancelled | 104,413 | |||||||||||||
Conversion of restricted stock, description | All of Aircom's 5,513,334 restricted shares were converted to 2,055,947 shares of Aerkomm's restricted stock at the ratio of 2.681651 to 1, pursuant to the Exchange Agreement (see Note 1). | |||||||||||||
Common stock for net proceeds | $ 41,262,899 | $ 4,387,427 | ||||||||||||
Total of share sold amount | $ 517,413 | $ 517,413 | ||||||||||||
Conversion to common stock [Member] | ||||||||||||||
Capital Stock (Textual) | ||||||||||||||
Unvested shares of restricted stock adjustment | 253,575 | |||||||||||||
Anthony D [Member] | ||||||||||||||
Capital Stock (Textual) | ||||||||||||||
Public offering common shares | 2,000 | 8,000 | ||||||||||||
Integra Consulting Group LLC [Member] | ||||||||||||||
Capital Stock (Textual) | ||||||||||||||
Public offering common shares | 4,000 | 16,000 | ||||||||||||
Private placement [Member] | ||||||||||||||
Capital Stock (Textual) | ||||||||||||||
Public offering common shares | 12,000 | 52,818 | 100,000 | 24,666 | ||||||||||
Common stock price per shares | $ 25 | $ 27.50 | $ 15 | $ 28 | ||||||||||
Share aggregate value | $ 300,000 | $ 1,452,473 | $ 1,500,000 | $ 690,648,000 | ||||||||||
Release agreement, description | A settlement and release agreement with Priceplay Taiwan Inc. ("PPTW") dated March 31, 2017, among the Company, PPTW and Aircom, the Company issued 32,772 shares of its common stock to PPTW in settlement of an outstanding $819,300 obligation of Aircom to PPTW. Additionally, pursuant to a similar settlement and release agreement with Priceplay.com, Inc. ("PPUS") dated March 31, 2017, the Company issued 29,480 shares of its common stock to PPUS in settlement of an outstanding $737,000 obligation of Aircom to PPUS, and pursuant to a third similar settlement and release agreement with Aircom and dMobile System Co. ltd. (dMobile), it issued 18,844 shares of its common stock to dMobile in settlement of an outstanding $471,100 obligation of Aircom to dMobile. In the aggregate, the Company has issued 81,096 shares to the three settlement recipients at a price of $25.00 per share for a total of $2,027,400. | |||||||||||||
Public Offering [Member] | ||||||||||||||
Capital Stock (Textual) | ||||||||||||||
Public offering common shares | 1,024,963 | |||||||||||||
Common stock for gross proceeds | $ 43,560,894 | |||||||||||||
Common stock for net proceeds | $ 39,810,204 | |||||||||||||
Common stock price per shares | $ 8.50 | |||||||||||||
Public Offering [Member] | Minimum [Member] | ||||||||||||||
Capital Stock (Textual) | ||||||||||||||
Underwriting discounts for maximum gross proceeds | $ 5,000,000 | |||||||||||||
Public Offering [Member] | Maximum [Member] | ||||||||||||||
Capital Stock (Textual) | ||||||||||||||
Underwriting discounts for maximum gross proceeds | $ 60,000,000 | |||||||||||||
Warrants [Member] | ||||||||||||||
Capital Stock (Textual) | ||||||||||||||
Conversion of restricted stock, description | The warrants allow the service provider to purchase a number of shares of Aerkomm common stock equal to the service fee value divided by 85% of the share price paid by investors for Aerkomm's common stock in the first subsequent qualifying equity financing event, at an exercise price of $0.01 per share. | |||||||||||||
Minimum shares to be issued under public offering | 4,891 | |||||||||||||
Cumulative additional paid-in capital related to warrants | $ 176,667 | |||||||||||||
Additional stock warrants exercisable | $ 30,000 | |||||||||||||
Common Stock [Member] | ||||||||||||||
Capital Stock (Textual) | ||||||||||||||
Public offering common shares | 1,059,646 | 269,849 | ||||||||||||
Common stock for net proceeds | $ 5,298 | $ 1,349 | ||||||||||||
Daniel Shih [Member] | Private placement [Member] | ||||||||||||||
Capital Stock (Textual) | ||||||||||||||
Public offering common shares | 1,000 | |||||||||||||
Common stock price per shares | $ 27.50 | |||||||||||||
Share aggregate value | $ 27,500 | |||||||||||||
Boustead Securities, LLC [Member] | ||||||||||||||
Capital Stock (Textual) | ||||||||||||||
Minimum shares to be issued under public offering | 117,647 | |||||||||||||
Minimum shares to be sold under public offering | 1,411,765 | |||||||||||||
Boustead Securities, LLC [Member] | Warrants [Member] | ||||||||||||||
Capital Stock (Textual) | ||||||||||||||
Stock warrants, description | The Company agreed to issue to Boustead warrants to purchase a number of the Company's shares equal to 6% of the gross proceeds of the public offering, which shall be exercisable, in whole or in part, commencing on April 13, 2018 and expiring on the five-year anniversary at an initial exercise price of $53.125 per share, which is equal to 125% of the offering price paid by investors. As of December 31, 2018, the Company issued warrants to Boustead to purchase 61,498 shares of the Company's stock. |
Major Customer (Details)
Major Customer (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | |
Major Customer (Textual) | |||||
Net sales | $ 1,730,000 | $ 1,730,000 | |||
One major customer [Member] | |||||
Major Customer (Textual) | |||||
Percentage of total sales | 10.00% | ||||
One major customer [Member] | Accounts Receivable [Member] | |||||
Major Customer (Textual) | |||||
Net sales | $ 1,745,000 |
Major Vendor (Details)
Major Vendor (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | |
Major Vendor (Textual) | |||||
Purchases | $ 1,661,849 | $ 1,661,849 | |||
One Major Vendor [Member] | |||||
Major Vendor (Textual) | |||||
Purchases | $ 1,650,000 | ||||
One Major Vendor [Member] | Accounts Payable [Member] | |||||
Major Vendor (Textual) | |||||
Percentage of total purchases | 10.00% |
Related Party Transactions (Det
Related Party Transactions (Details) | 12 Months Ended | |
Dec. 31, 2018 | ||
Daniel Shih [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship | Co-founder and former stockholder; Aircom's CEO and Director between February 13, 2017 and April 26, 2017; Aircom's CFO between February 13, 2017 and May 5, 2017 | [1] |
Dmedia Holding LP ("Dmedia") [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship | 23.99% stockholder | |
Bummy Wu [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship | Shareholder | |
Jeffrey Wun [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship | Shareholder and CEO of Aerkomm and Aircom | |
Yih Lieh (Giretsu) Shih [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship | President of Aircom Japan | |
Hao Wei Peng [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship | Employee of Aircom Taiwan and founding owner of Aircom Taiwan prior to 12/19/2017 | |
Louis Giordimaina [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship | COO - Aviation of Aircom | |
Klingon Aerospace, Inc. ("Klingon") [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship | Daniel Shih was the Chairman from February 2015 to February 2016 | |
Wealth Wide Int'l Ltd. ("WWI") [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship | Bummy Wu, a shareholder, is the Chairman | |
WISD Intellectual Property Agency, Ltd. ("WISD") [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship | Patrick Li, Director of Aircom, is the Chairman; Chih-Ming (Albert) Hsu, Director of the Company, is a Director | |
Yun Shu Chiou [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship | Former CEO and President prior to December 31, 2017 | |
[1] | Daniel Shih has relinquished "beneficial ownership" of substantially all of his equity interests in the Company (whether held directly or indirectly) in a manner acceptable to the Company. This means that Daniel Shih no longer, directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise has or shares (i) voting power, which includes the power to vote, or to direct the voting of, securities, and/or (ii) investment power, which includes the power to dispose, or to direct the disposition of, shares of the Company's common stock, except for a de minimus number of shares of the common stock which will continue to be beneficially owned by him by way of his being a control person in another entity that owns shares of the common stock. Daniel Shih will, however, retain a pecuniary interest in some of the shares of the common stock over which he has relinquished voting and investment power. Daniel Shih has also removed himself from any and all activities relating to the Company's business, including, but not limited to managerial, directional, advisory, promotional, developmental and fund-raising activities, effective upon the effectiveness of the registration statement on Form S-1 originally filed with the SEC on December 20, 2017 and declared effective on April 13, 2018, as amended and supplemented to date. Additionally, Barbie Shih (Barbie), Daniel Shih's wife, was not re-elected to the Company's board of directors on December 29, 2017. As a result of these events, neither Daniel nor Barbie will maintain any active affiliation with, or material beneficial ownership interest in, the Company. |
Related Party Transactions (D_2
Related Party Transactions (Details 1) - USD ($) | Dec. 31, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | |
Related Party Transaction [Line Items] | ||||
Other receivable | $ 46,743 | |||
Temporary deposit | 100,067 | |||
Hao Wei Peng [Member] | ||||
Related Party Transaction [Line Items] | ||||
Other receivable | [1] | 46,743 | ||
Bummy Wu [Member] | ||||
Related Party Transaction [Line Items] | ||||
Temporary deposit | [2] | 100,067 | ||
Daniel Shih [Member] | ||||
Related Party Transaction [Line Items] | ||||
Rental deposit | 2,462 | 2,542 | 2,396 | |
Other payable to: | [3] | 13,444 | 132,305 | 128,543 |
Dmedia [Member] | ||||
Related Party Transaction [Line Items] | ||||
Loan from Dmedia | [4] | 325,040 | ||
Klingon [Member] | ||||
Related Party Transaction [Line Items] | ||||
Other payable to: | [5] | 762,000 | 762,000 | 762,000 |
Jeffrey Wun [Member] | ||||
Related Party Transaction [Line Items] | ||||
Other payable to: | [6] | 46,236 | 22,327 | |
Louis Giordimaina [Member] | ||||
Related Party Transaction [Line Items] | ||||
Other payable to: | 6,071 | 135,973 | ||
Yih Lieh (Giretsu) Shih [Member] | ||||
Related Party Transaction [Line Items] | ||||
Other payable to: | [6] | 15,497 | 81,752 | 76,600 |
WWI [Member] | ||||
Related Party Transaction [Line Items] | ||||
Other payable to: | [7] | 39,224 | 38,241 | 9,410 |
Others [Member] | ||||
Related Party Transaction [Line Items] | ||||
Other payable to: | [6] | 66,826 | 149,307 | 83,515 |
Total [Member] | ||||
Related Party Transaction [Line Items] | ||||
Other payable to: | $ 949,298 | $ 1,299,578 | $ 1,082,395 | |
[1] | Represents receivable from Mr. Peng due to the transactions prior to the acquisition of Aircom Telecom on December 19, 2017. The amount is subsequently collected on January 4, 2018. | |||
[2] | In November 2018, Aircom HK's bank account was temporarily frozen by its local bank in Hong Kong (the "HK bank") due to Aircom HK's failure to timely submit to the HK bank corporate documentation relating to the corporate organization and goodstanding of Aircom HK's parent company, Aircom, and Aircom's parent company, Aerkomm. To avoid a potential cash flow issue resulting from this temporary account freeze, Aircom HK withdrew $100,067 in cash from the HK bank and temporarily deposited it in an existing related party's bank account at a different bank for safe keeping. The Aircom HK's bank account with the HK bank was reactivated by the HK bank subsequently and the cash that was transferred to the related party's account was redeposited into Aircom HK's bank account at the HK bank in February 2019. | |||
[3] | The amount as of March 31, 2018 represents payable to employees as a result of regular operating activities, while the amount as of December 31, 2018 represents rental payable. | |||
[4] | Represents short-term loan from Dmedia. This short-term loan has an expiration date of January 30, 2019 and an annual interest rate of 3%. The Company repaid the short-term loan in full on June 14, 2018. | |||
[5] | On March 9, 2015, the Company entered into a 10-year purchase agreement with Klingon. In accordance with the terms of this agreement, Klingon agreed to purchase from the Company an initial order of onboard equipment comprising an onboard system for a purchase price of $909,000, with payments to be made in accordance with a specific milestones schedule. As of December 31, 2018, the Company received $762,000 from Klingon in milestone payments towards the equipment purchase price. Since the project might not be successful, the Company reclassified the balance from customer prepayment to other payable due to uncertainty. | |||
[6] | Represents payable to employees as a result of regular operating activities. | |||
[7] | Represents rent for a warehouse in Hong Kong to store the Company's hardware and another rent for the Hong Kong office starting June 28, 2018. |
Related Party Transactions (D_3
Related Party Transactions (Details 2) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | |
Louis Giordimaina [Member] | |||||
Related Party Transaction [Line Items] | |||||
Consulting expense paid | $ 134,971 | $ 87,275 | $ 222,246 | ||
Yun Shu Chiou [Member] | |||||
Related Party Transaction [Line Items] | |||||
Consulting expense paid | 55,000 | ||||
WISD [Member] | |||||
Related Party Transaction [Line Items] | |||||
Legal expenses paid | 10,779 | 10,779 | |||
Daniel Shih [Member] | |||||
Related Party Transaction [Line Items] | |||||
Rental expense charged | 4,040 | 11,811 | 20,232 | 15,851 | 20,232 |
WWI [Member] | |||||
Related Party Transaction [Line Items] | |||||
Rental expense charged | 1,350 | 27,486 | 3,150 | 28,836 | 3,150 |
Dmedia [Member] | |||||
Related Party Transaction [Line Items] | |||||
Interest expense charged | $ 1,201 | $ 1,915 | $ 3,116 |
Related Party Transactions (D_4
Related Party Transactions (Details Textual) - USD ($) | Mar. 09, 2015 | Nov. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2018 |
Related Party Transactions (Textual) | ||||
Rental fee, per month | $ 1,200 | |||
Lease agreement, description | Aircom Japan entered into a lease agreement with Daniel Shih, between August 1, 2014 and July 31, 2016, which was renewed on July 31, 2018. | |||
Consulting services | $ 222,246 | |||
Cash withdrew from HK bank | $ 100,067 | |||
Klingon [Member] | ||||
Related Party Transactions (Textual) | ||||
Purchase agreement periods | 10 years | |||
Purchase price of equipment | $ 909,000 | |||
Other payable | $ 762,000 | |||
Dmedia [Member] | ||||
Related Party Transactions (Textual) | ||||
Interest rate | 3.00% | 3.00% | ||
Maturity date | Jan. 30, 2019 | |||
WWI [Member] | ||||
Related Party Transactions (Textual) | ||||
Lease agreement, description | The Company has a lease agreement with WWI with monthly rental cost of $450. The lease term was from June 1, 2017 to May 31, 2018 and the lease was not renewed. The Company has another lease agreement with WWI for its office space in Hong Kong with monthly rental cost of $3,833. The lease term is from June 28, 2018 to June 27, 2020. |
Stock Based Compensation (Detai
Stock Based Compensation (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected dividends | 0.00% |
Minimum [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected term | 3 years |
Expected volatility | 40.11% |
Risk-free interest rate | 0.71% |
Forfeiture rate | 0.00% |
Maximum [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected term | 5 years |
Expected volatility | 61.78% |
Risk-free interest rate | 2.99% |
Forfeiture rate | 5.00% |
Stock Based Compensation (Det_2
Stock Based Compensation (Details 1) - Aircom 2014 Plan [Member] - $ / shares | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Number of Shares | |||
Options outstanding, Beginning | 932,262 | 932,262 | 1,088,882 |
Granted | |||
Exercised | (3,936) | ||
Forfeited/Cancelled | (152,684) | ||
Options outstanding, Ending | 932,262 | 932,262 | 932,262 |
Exercisable, Ending | 681,587 | 846,287 | 629,795 |
Weighted Average Exercise Price Per Share | |||
Options outstanding, Beginning | $ 0.4081 | $ 0.4081 | $ 0.8087 |
Granted | |||
Exercised | 0.0067 | ||
Forfeited/Cancelled | 3.2749 | ||
Options outstanding, Ending | 0.4081 | 0.4081 | 0.4081 |
Exercisable, Ending | 0.2200 | 0.3660 | 0.2060 |
Weighted Average Fair Value Per Share | |||
Options outstanding, beginning | 0.1282 | 0.1282 | 0.2542 |
Granted | |||
Exercised | 0.0019 | ||
Forfeited/Cancelled | 1.0296 | ||
Options outstanding, Ending | 0.1282 | 0.1282 | 0.1282 |
Exercisable, Ending | $ 0.0690 | $ 0.1150 | $ 0.0645 |
Stock Based Compensation (Det_3
Stock Based Compensation (Details 2) - Nonvested Shares [Member] - Aircom 2014 Plan [Member] - $ / shares | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Number of Shares | ||||
Outstanding, Beginning | 302,467 | 250,675 | 302,467 | 675,510 |
Granted | ||||
Vested | (51,792) | (164,700) | (220,359) | |
Forfeited/Cancelled | (152,684) | |||
Outstanding, Ending | 250,675 | 85,975 | 85,975 | 302,467 |
Weighted Average Exercise Price Per Share | ||||
Options outstanding, beginning | $ 0.8315 | $ 0.9163 | $ 0.8315 | $ 1.2985 |
Granted | ||||
Vested | 0.408 | 0.5748 | 0.573 | |
Forfeited/Cancelled | 3.2749 | |||
Options outstanding, Ending | $ 0.9163 | $ 0.7305 | $ 0.7305 | $ 0.8315 |
Stock Based Compensation (Det_4
Stock Based Compensation (Details 3) - Aerkomm 2017 Plan [Member] - $ / shares | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Number of Shares | |||
Outstanding, Beginning | 253,000 | 205,000 | |
Granted | 78,000 | 412,000 | |
Exercised | |||
Forfeited/Cancelled | (48,000) | (159,000) | |
Outstanding, Ending | 205,000 | 283,000 | 253,000 |
Exercisable, Ending | 40,875 | 111,589 | 84,750 |
Weighted Average Exercise Price Per Share | |||
Options outstanding, Beginning | $ 30.8825 | $ 31.6744 | |
Granted | 19.7462 | 29.5771 | |
Exercised | |||
Forfeited/Cancelled | 27.5 | 27.5 | |
Options outstanding, Ending | 31.6744 | 28.3867 | 30.8825 |
Exercisable, Ending | 28.2339 | 28.7052 | 27.584 |
Weighted Average Fair Value Per Share | |||
Options outstanding, beginning | 17.5175 | 18.9522 | |
Granted | 9.25 | 17.7006 | |
Exercised | |||
Forfeited/Cancelled | 16.461 | 16.461 | |
Options outstanding, Ending | 18.9522 | 16.2781 | 17.5175 |
Exercisable, Ending | $ 17.5839 | $ 16.5968 | $ 17.0025 |
Stock Based Compensation (Det_5
Stock Based Compensation (Details 4) - Nonvested Shares [Member] - Aircom 2014 Plan [Member] - $ / shares | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Number of Shares | ||||
Outstanding, Beginning | 168,250 | 164,125 | 168,250 | |
Granted | 78,000 | 412,000 | ||
Vested | (4,125) | (70,714) | (84,750) | |
Forfeited/Cancelled | (159,000) | |||
Outstanding, Ending | 164,125 | 171,411 | 171,411 | 168,250 |
Weighted Average Exercise Price Per Share | ||||
Options outstanding, beginning | $ 32.408 | $ 32.5312 | $ 32.408 | |
Granted | 19.7462 | 29.5771 | ||
Vested | 27.5 | 28.9777 | 27.854 | |
Forfeited/Cancelled | 27.5 | |||
Options outstanding, Ending | $ 32.5312 | $ 28.1794 | $ 28.1794 | $ 32.408 |
Stock Based Compensation (Det_6
Stock Based Compensation (Details Textual) - USD ($) | Dec. 29, 2017 | Dec. 29, 2018 | Jun. 19, 2018 | Jul. 31, 2017 | Jun. 23, 2017 | Feb. 13, 2017 | Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | May 05, 2017 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Stock option aggregate shares | 1,088,882 | |||||||||||
Share-based Compensation | $ 275,806 | $ 1,147,155 | $ 1,740,446 | $ 1,422,961 | $ 1,749,446 | |||||||
Unrecognized compensation cost | $ 1,756,000 | $ 2,174,000 | $ 5,057,000 | $ 2,174,000 | $ 5,057,000 | |||||||
Minimum [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Recognize weighted average period | 1 year | |||||||||||
Maximum [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Recognize weighted average period | 5 years | |||||||||||
Aerkomm 2017 [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Description of plan agreements | Which includes, 1) 1/6 of the shares subject to the option shall vest commencing on the vesting start date and the remaining shares shall vest at the rate of 1/60 for the next 60 months on the same day of the month as the vesting start date; 2) 1/4 of the shares subject to the option shall vest commencing on the vesting start date and the remaining shares shall vest at the rate of 1/36 for the next 36 months on the same day of the month as the vesting start date; 3) 1/3 of the shares subject to the option shall vest commencing on the first anniversary of vesting start date and the remaining shares shall vest at the rate of 50% each year for the next two years on the same day of the month as the vesting start date. | |||||||||||
Aerkomm 2017 [Member] | Board of Directors [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Stock option aggregate shares | 12,000 | 109,000 | ||||||||||
Issuance shares of common stock | 2,000,000 | 1,000,000 | ||||||||||
Aggregate shares issue | 291,000 | |||||||||||
Description of plan agreements | The Aerkomm 2017 Plan to two of the Company executives. One-fourth of the 32,000 shares subject to the option shall vest on May 1, 2019, 2020, 2021 and 2022, respectively. One-third of the 30,000 shares subject to the option shall vest on May 29, 2019, 2020 and 2021, respectively. | The Aerkomm 2017 Plan to 11 of its employees. 1/3 of these shares subject to the option shall vest commencing on the first anniversary of vesting start date and the remaining shares shall vest at the rate of 50% each year for the next two years on the same day of the month as the vesting start date. | ||||||||||
Aerkomm 2017 [Member] | Board of Directors [Member] | Minimum [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Stock option aggregate shares | 30,000 | |||||||||||
Aerkomm 2017 [Member] | Board of Directors [Member] | Maximum [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Stock option aggregate shares | 32,000 | |||||||||||
Aerkomm 2017 [Member] | Independent Directors [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Stock option aggregate shares | 4,000 | 4,000 | ||||||||||
Aerkomm 2014 Plan [Member] | Stock Options [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Description of plan agreements | The Company, and 1/36th of the shares will be vested each month thereafter. Option price is determined by the Board of Directors. The Aircom 2014 Plan became effective upon its adoption by the Board and shall continue in effect for a term of 10 years unless sooner terminated under the terms of Aircom 2014 Plan. | |||||||||||
Compensation Committee [Member] | Aerkomm 2017 [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Stock option aggregate shares | 12,000 |
Commitments (Details)
Commitments (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Jun. 20, 2018 | Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | |
Japan office [Member] | ||||||
Commitments (Textual) | ||||||
Lease expiration year, description | Expiring June 2020. | |||||
Lease rental expenses | $ 9,731 | $ 28,578 | $ 30,475 | $ 38,309 | $ 55,043 | |
Future minimum lease payment, Current year | $ 35,572 | 35,572 | ||||
Consumption tax | 8.00% | |||||
California [Member] | ||||||
Commitments (Textual) | ||||||
Lease expiration year, description | Expires in May 2020. | |||||
Lease rental expenses | 15,618 | $ 58,014 | 54,653 | 73,632 | 71,152 | |
Future minimum lease payment, Second year | $ 77,352 | 77,352 | ||||
Taiwan [Member] | ||||||
Commitments (Textual) | ||||||
Lease expiration year, description | Expiring October 31, 2018. | |||||
Lease rental expenses | 0 | $ 66,589 | 0 | 0 | 0 | |
Future minimum lease payment, Current year | $ 88,206 | 88,206 | ||||
Hong Kong [Member] | ||||||
Commitments (Textual) | ||||||
Lease expiration year, description | Expiring June 27, 2020. | |||||
Lease rental expenses | $ 0 | $ 26,550 | $ 0 | 0 | $ 0 | |
Future minimum lease payment, Current year | $ 45,974 | $ 45,974 | ||||
Commitments, description | The Company entered into a Cooperation Framework Agreement with Shenzhen Yihe Culture Media Co., Ltd. ("Yihe"), the authorized agent of Guangdong Tengnan Internet, pursuant to which Yihe will promote the development of strategic cooperation between the Company and Guangdong Tengnan Internet. Specifically, Yihe agreed to assist the Company with public relations and advertising, such as market and brand promotion, as well as brand recognition in China (excluding Hong Kong, Macao and Taiwan), including but not limited to news dissemination, creative planning and support of campaigns, financial public relations and internet advertising. More specifically, Yihe will help the Company develop a working application of the WeChat Pay payment solution as well as WeChat applets applicable for Chinese users and relating to cell phone and WiFi connectivity on airplanes, and Yihe will assist the Company in integrating other Tencent internet-based original product offerings. As compensation, the Company agreed to pay Yihe RMB 8 million (approximately US$1.2 million), with RMB 2,000,000 (approximately US$309,000) paid on June 29, 2018 and the remaining RMB 6,000,000 (approximately US$927,000) to be paid by August 15, 2018. However, the Company is currently working with Yihe to postpone the project as well as the remaining payment, although there can be no assurance that a postponement will be agreed upon on terms acceptable to the Company if at all. |
Subsequent Events (Details)
Subsequent Events (Details) - Subsequent Event [Member] | Jan. 16, 2019 |
Subsequent Events (Textual) | |
Reverse stock split, description | The Company completed a 1-for-5 reverse split of the Company's issued and outstanding shares of common stock (the "Reverse Split"), which was completed by the filing of a Certificate of Change Pursuant to NRS 78.209 (the "Certificate of Change") with the Nevada Secretary of State on December 26, 2018. |
Common Stock [Member] | |
Subsequent Events (Textual) | |
Reverse stock split, description | The Company's common stock are deemed to hold one (1) post-split share of the Company's common stock for every five (5) shares of the Company's common stock held. No fractional shares were issued in connection with the Reverse Split. Stockholders entitled to a fractional post-split share received in lieu thereof one (1) whole post-split share. |
Board of Directors [Member] | |
Subsequent Events (Textual) | |
Reverse stock split, description | The Company without stockholder approval, in accordance with the authority conferred by Section 78.207 of the Nevada Revised Statutes. The Certificate of Change also decreased the authorized number of shares of the Company's common stock from 450,000,000 shares to 90,000,000 shares, effective as of December 26, 2018. |