Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2019 | Nov. 07, 2019 | |
Document And Entity Information | ||
Entity Registrant Name | Superior Drilling Products, Inc. | |
Entity Central Index Key | 0001600422 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2019 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Reporting Status Current | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business Flag | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 25,097,750 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2019 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Current assets | ||
Cash | $ 2,791,956 | $ 4,264,767 |
Accounts receivable, net | 4,098,536 | 2,273,189 |
Prepaid expenses | 167,464 | 133,607 |
Inventories | 960,330 | 1,003,623 |
Asset held for sale | 252,704 | |
Total current assets | 8,270,990 | 7,675,186 |
Property, plant and equipment, net | 7,868,520 | 8,226,009 |
Intangible assets, net | 2,277,778 | 3,686,111 |
Other noncurrent assets | 58,028 | 51,887 |
Total assets | 18,475,316 | 19,639,193 |
Current liabilities | ||
Accounts payable | 1,274,041 | 721,361 |
Accrued expenses | 1,610,265 | 631,860 |
Current portion of long-term debt, net of discounts | 4,591,811 | 4,578,759 |
Total current liabilities | 7,476,117 | 5,931,980 |
Long-term debt, less current portion, net of discounts | 4,176,321 | 6,296,994 |
Total liabilities | 11,652,438 | 12,228,974 |
Commitments and contingencies (Note 9) | ||
Shareholders' equity | ||
Common stock - $0.001 par value; 100,000,000 shares authorized; 25,097,750 shares issued and outstanding | 25,098 | 25,018 |
Additional paid-in-capital | 39,914,248 | 39,440,611 |
Accumulated deficit | (33,116,468) | (32,055,410) |
Total shareholders' equity | 6,822,878 | 7,410,219 |
Total liabilities and shareholders' equity | $ 18,475,316 | $ 19,639,193 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Sep. 30, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Common stock, par value per share | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 25,097,750 | 25,097,750 |
Common stock, shares outstanding | 25,097,750 | 25,097,750 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Revenue | ||||
Total Revenue | $ 5,076,215 | $ 4,765,361 | $ 14,656,003 | $ 14,764,577 |
Operating costs and expenses | ||||
Cost of revenue | 2,062,803 | 1,665,774 | 6,119,429 | 5,407,389 |
Selling, general and administrative expenses | 2,501,970 | 1,866,833 | 6,387,205 | 4,991,481 |
Depreciation and amortization expense | 738,555 | 942,473 | 2,680,070 | 2,820,183 |
Total operating costs and expenses | 5,303,328 | 4,475,080 | 15,186,704 | 13,219,053 |
Operating income (loss) | (227,113) | 290,281 | (530,701) | 1,545,524 |
Other income (expense) | ||||
Interest income | 12,080 | 16,066 | 52,444 | 30,080 |
Interest expense | (196,582) | (178,642) | (590,805) | (552,692) |
Gain on disposition of assets | 14,147 | |||
Impairment on asset held for sale | (6,143) | (6,143) | ||
Total other income (expense) | (190,645) | (162,576) | (530,357) | (522,612) |
Net income (loss) | $ (417,758) | $ 127,705 | $ (1,061,058) | $ 1,022,912 |
Basic income (loss) earnings per common share | $ (0.02) | $ 0.01 | $ (0.04) | $ 0.04 |
Basic weighted average common shares outstanding | 25,074,466 | 24,542,551 | 25,042,577 | 24,537,647 |
Diluted income (loss) per common share | $ (0.02) | $ 0.01 | $ (0.04) | $ 0.04 |
Diluted weighted average common shares outstanding | 25,074,466 | 25,162,445 | 25,042,577 | 25,156,629 |
Tool Revenue [Member] | ||||
Revenue | ||||
Total Revenue | $ 3,194,999 | $ 3,361,182 | $ 9,212,420 | $ 10,962,071 |
Contract Services [Member] | ||||
Revenue | ||||
Total Revenue | $ 1,881,216 | $ 1,404,179 | $ 5,443,583 | $ 3,802,506 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Cash Flows From Operating Activities | ||
Net income (loss) | $ (1,061,058) | $ 1,022,912 |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||
Depreciation and amortization expense | 2,680,070 | 2,820,183 |
Amortization of debt discount | 43,459 | |
Share based compensation expense | 473,717 | 372,211 |
Impairment of inventories | 41,396 | |
Gain on disposition of assets | (14,147) | |
Impairment on asset held for sale | 6,143 | |
Amortization of deferred loan costs | 10,561 | |
Changes in operating assets and liabilities: | ||
Accounts receivable | (1,825,347) | 38,150 |
Inventories | (539,586) | 121,484 |
Prepaid expenses and other noncurrent assets | (39,998) | (308,072) |
Accounts payable and accrued expenses | 1,531,085 | (181,515) |
Net Cash From Operating Activities | 1,221,440 | 3,970,208 |
Cash Flows From Investing Activities | ||
Purchases of property, plant and equipment | (392,691) | (183,263) |
Net Cash From Investing Activities | (392,691) | (183,263) |
Cash Flows From Financing Activities | ||
Principal payments on debt | (3,813,443) | (1,887,061) |
Proceeds received from debt borrowings | 800,000 | |
Payments on revolving loan | (735,019) | |
Proceeds received on revolving loan | 1,517,005 | |
Debt issuance costs | (70,103) | |
Net Cash From Financing Activities | (2,301,560) | (1,887,061) |
Net change in Cash | (1,472,811) | 1,899,884 |
Cash at Beginning of Period | 4,264,767 | 2,375,179 |
Cash at End of Period | 2,791,956 | 4,275,063 |
Supplemental information: | ||
Cash paid for Interest | 673,251 | 488,112 |
Inventory converted to property, plant and equipment | 582,879 | |
Acquisition of equipment by issuance of note payable | $ 183,378 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization and Nature of Operations Superior Drilling Products, Inc. (the “Company”, “SDPI”, “we”, “our” or “us”) is an innovative drilling and completion tool technology company providing cost saving solutions that drive drilling efficiencies for the oil and natural gas drilling and completions industry. We are headquartered in Vernal, Utah with manufacturing operations both there and in Abilene, Texas. We also have offices in Saudi Arabia. Our drilling solutions include the patented Drill-N-Ream® well bore conditioning tool (“Drill-N-Ream tool”) and the patented Strider™ Drill String Oscillation System technology (“Strider technology” or “Strider”). In addition, the Company is a manufacturer and refurbisher of PDC (polycrystalline diamond compact) drill bits and other select products for a leading oil field services company. Our drill tool fabrication facilities are state-of-the-art operations, where we manufacture both our solutions for the drilling industry, as well as customers’ custom products. Our subsidiaries include (a) Superior Drilling Solutions, LLC (previously known as Superior Drilling Products, LLC), a Utah limited liability company (“SDS”), together with its wholly owned subsidiary Superior Design and Fabrication, LLC, a Utah limited liability company (“SDF”), (b) Extreme Technologies, LLC, a Utah limited liability company (“ET”), (c) Meier Properties Series, LLC, a Utah limited liability company (“MPS”), (d) Meier Leasing, LLC, a Utah limited liability company (“ML”), and (e) Hard Rock Solutions, LLC (“HR” or “Hard Rock”). Basis of Presentation The Company’s consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The consolidated financial statements include the accounts of Superior Drilling Products Inc. and all of its wholly-owned subsidiaries. All significant intercompany accounts have been eliminated in consolidation. The Company does not have investments in any unconsolidated subsidiaries. In April 2012, the JOBS Act was enacted. Section 107 of the JOBS Act provides that an emerging growth company can utilize the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for implementing new or revised accounting standards. An emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to nonissuers. We have elected to delay such adoption of new or revised accounting standards, and as a result, we may not implement new or revised accounting standards on the relevant dates on which adoption of such standards is required for other issuer companies. Subject to certain conditions set forth in the JOBS Act, as an emerging growth company, we intend to rely on certain of these exemptions, including without limitation, providing an auditor’s attestation report on our system of internal controls over financial reporting pursuant to Section 404 and implementing any requirement that may be adopted regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (auditor discussion and analysis). We will remain an emerging growth company until the earliest of (i) the end of the fiscal year in which the market value of our common stock that is held by exceeds $700 million as of June 30, (ii) the end of the fiscal year in which we have total annual gross revenue of $1.07 billion or more during such fiscal year, (iii) the date on which we issue more than $1.0 billion in debt in a three-year period or (iv) January 1, 2020. Unaudited Interim Financial Presentation These interim consolidated condensed financial statements for the three and nine months ended September 30, 2019 and 2018, and the related footnote disclosures included herein, are unaudited. However, in the opinion of management, these unaudited interim financial statements have been prepared on the same basis as the audited financial statements, and reflect all adjustments necessary to fairly state the results for such periods. The results of operations for the three and nine months ended September 30, 2019 are not necessarily indicative of the results of operations expected for the year ended December 31, 2019. These interim consolidated condensed financial statements should be read in conjunction with the audited restated consolidated financial statements of the Company for the years ended December 31, 2018 and 2017 and the notes thereto, which were included in the Company’s Annual Report on Form 10-K/A for the year ended December 31, 2018, filed with the Securities and Exchange Commission (the “SEC”) on August 19, 2019. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts in the financial statements and accompanying notes. Actual results could differ from those estimates. Significant items subject to estimates and assumptions include the carrying amount and useful lives of property and equipment and intangible assets, impairment assessments, share-based compensation expense, and valuation allowances for accounts receivable, inventories, and deferred tax assets. Significant Customers For the nine months ended September 30, 2019, two customers represented 94% of our total revenue during the period. For the nine months ended September 30, 2018, two customers represented 95% of our total revenue during the period. Significant Vendors The Company had one vendor that represented 12% of our purchases for the nine months ended September 30, 2019. This vendor had approximately $218,000 in accounts payable at September 30, 2019 and purchases in the nine months of 2019 from this vendor totaled approximately $772,000. The Company had one vendor that represented 12% of our purchases for the nine months ended September 30, 2018. This vendor had approximately $147,000 in accounts payable at September 30, 2018 and purchases in the nine months of 2018 from this vendor totaled approximately $671,000. Recently Issued Accounting Standards Standards Adopted Effective January 1, 2019, the Company adopted the accounting guidance in Accounting Standards Update (“ASU”) No. 2014-09, “ Revenue from Contracts with Customers Standards Not Yet Adopted In February 2016, the FASB issued ASU No. 2016-02, “ Leases |
Revenue
Revenue | 9 Months Ended |
Sep. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | NOTE 2. REVENUE Accounting Policy We account for revenue in accordance with Topic 606, which we adopted on January 1, 2019, using the full retrospective method. The adoption of Topic 606 did not have a material impact on the timing or amounts of revenue recognized in our unaudited condensed consolidated financial statements and therefore did not have a material impact on our financial position, results of operations, equity or cash flows as of the adoption date for the nine months ended September 30, 2019. The Company did not record any adjustments to opening retained earnings as of December 31, 2017 or for any periods previously presented. Furthermore, the impact of the adoption of the new standard is immaterial to our revenue and gross profit on an ongoing basis. Revenue Recognition Our revenue is derived from short-term contracts. Revenue is recognized when we satisfy a performance obligation by transferring control of the promised goods or services to our customers at a point in time, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. We also assess our customer’s ability and intention to pay, which is based on a variety of factors including our customer’s historical payment experience and financial condition. Payment terms and conditions vary, although terms generally include a requirement of payment within 30 days. Revenue generally does not include right of return or other significant post-delivery obligations. Revenue is recognized net of any taxes collected from customers, which are subsequently remitted to governmental authorities. We elected to treat shipping and handling costs as a fulfillment cost instead of as a separate performance obligation. We recognize the cost for shipping and handling when incurred as an expense in cost of sales. Performance Obligations A performance obligation is a promise in a contract to transfer a distinct good or service to the customer under Topic 606. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. The majority of our contracts with customers contain a single performance obligation to provide agreed-upon products or services. For contracts with multiple performance obligations, we allocate revenue to each performance obligation based on its relative standalone selling price. In accordance with Topic 606, we do not assess whether promised goods or services are performance obligations if they are immaterial in the context of the contract with the customer. All of our contracts are less than one year in duration. We do not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed. Disaggregation of Revenue Approximately 95% of our revenue is from the United States and approximately 5% is from the Middle East for the nine months ended September 30, 2019. For the nine months ended September 30, 2018, approximately 98% of our revenue was from the United States and approximately 2% was from the Middle East. Tool Revenue Tool and Product Sales Tool Rental Other Related Revenue: Contract Services Drill Bit Manufacturing and Refurbishment Revenue disaggregated by revenue source are as follows: Nine months ended September 30, 2019 2018 Tool Revenue: Tool and product sales $ 3,358,119 $ 5,746,828 Tool rental 755,720 406,335 Other related revenue 5,098,581 4,808,908 Total Tool Revenue 9,212,420 10,962,071 Contract Services 5,443,583 3,802,506 Total Revenue $ 14,656,003 $ 14,764,577 Contract Costs We do not incur any material costs of obtaining contracts. Contract Balances Under our sales contracts, we invoice customers after our performance obligations have been satisfied, at which point payment is unconditional. Accordingly, our contracts do not give rise to contract assets or liabilities under ASC 606. |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Inventories | NOTE 3. INVENTORIES Inventories are comprised of the following: September 30, 2019 December 31, 2018 Raw material $ 787,167 $ 738,330 Work in progress 125,028 217,158 Finished goods 48,135 48,135 $ 960,330 $ 1,003,623 |
Property, Plant and Equipment
Property, Plant and Equipment | 9 Months Ended |
Sep. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | NOTE 4. PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment are comprised of the following: September 30, 2019 December 31, 2018 Land $ 880,416 $ 880,416 Buildings 4,741,564 4,847,778 Building improvements 755,039 755,039 Machinery and equipment 9,807,981 8,816,880 Office equipment, fixtures and software 603,358 518,806 Transportation assets 350,871 811,378 17,139,229 16,630,297 Accumulated depreciation (9,270,709 ) (8,404,288 ) $ 7,868,520 $ 8,226,009 The Company has decided to sell the Company airplane and respective hangar, and we expect a sale to be completed in the next 12 months. Accordingly, these assets are reported as assets held for sale on our balance sheet as of September 30, 2019 at their carrying value, which is lower than the expected fair value less costs to sell. Depreciation expense related to property, plant and equipment for the three and nine months ended September 30, 2019 was $446,888 and $1,271,737, respectively and for the three and nine months ended September 30, 2018 was $330,806 and $985,183, respectively. |
Intangible Assets
Intangible Assets | 9 Months Ended |
Sep. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | NOTE 5. INTANGIBLE ASSETS Intangible assets are comprised of the following: September 30, 2019 December 31, 2018 Developed technology $ 7,000,000 $ 7,000,000 Customer contracts 6,400,000 6,400,000 Trademarks 1,500,000 1,500,000 14,900,000 14,900,000 Accumulated amortization (12,622,222 ) (11,213,889 ) $ 2,277,778 $ 3,686,111 Amortization expense related to intangible assets for the three and nine months ended September 30, 2019 was $291,667 and $1,408,333, respectively and for the three and nine months ended September 30, 2018 was $611,667 and $1,835,000, respectively. Annually, and more often as necessary, we will perform an evaluation of our intangible assets for indications of impairment. If indications exist, we will perform an evaluation of the fair value of the intangible assets and, if necessary, record an impairment charge. As of September 30, 2019, the Company reviewed the net balance of the intangible assets and determined no impairment was needed. |
Related Party Note Receivable
Related Party Note Receivable | 9 Months Ended |
Sep. 30, 2019 | |
Receivables [Abstract] | |
Related Party Note Receivable | NOTE 6. RELATED PARTY NOTE RECEIVABLE In January 2014, we entered into a Note Purchase and Sale Agreement under which we agreed to purchase a loan made to Tronco Energy Corporation (“Tronco”), a party related to us through common control, in order to take over the legal position as Tronco’ s senior secured lender. Effective August 2017, the Company fully reserved the related party note receivable of $6,979,043, which reduced the related party note receivable balance to $0. The Company continues to hold the 8,267,860 shares of the Company’s common stock as collateral. The Company will record a recovery of the loan upon receiving repayment of the note or interest in other income. Interest only is due December 31, 2019, 2020 and 2021, with a balloon payment of all unpaid interest and principal due upon maturity on December 31, 2022. The interest rate on the note is 5.5%. |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | NOTE 7. LONG-TERM DEBT Long-term debt is comprised of the following: September 30, 2019 December 31, 2018 Real estate loans $ 3,023,436 $ 4,255,152 Hard Rock Note 3,750,000 6,000,000 Credit Agreement 1,422,442 - Machinery loans 260,678 327,879 Transportation loans 311,576 292,722 Less: Current portion (4,591,811 ) (4,578,759 ) Long-term debt, net $ 4,176,321 $ 6,296,994 Real Estate Loans On February 1, 2019, we signed a loan agreement for $3,129,861 refinancing our commercial bank loan that is secured by our Vernal, Utah Campus. We paid $1,000,000 towards the previous loan that was scheduled to mature on February 15, 2019, upon refinancing. The loan requires monthly payments of approximately $43,000, including principal and interest at 7.25%, and is secured by the land and buildings at our Vernal, Utah Campus. A balloon payment of approximately $2,500,000 is due upon maturity on February 15, 2021. Hard Rock Note In 2014, the Company purchased all of the interests of Hard Rock Solutions, LLC (“Hard Rock”). Consideration consisted of $12.5 million paid in cash at closing and a $12.5 million seller’s note (the “Hard Rock Note”). The Hard Rock Note and subsequent amendments are secured by all of the patents, patents pending, other patent rights, and trademarks transferred to Hard Rock. Under the current terms of Hard Rock Note, we are required to pay principal payments of $750,000 (plus accrued interest) on each January 5, April 5, July 5 and October 5 in 2019 and 2020. In January 2019, the Company made a principal payment of $750,000 and an interest payment of $183,411. In April 2019, the Company made a principal payment of $750,000 and an interest payment of $88,639. In July 2019, the Company made a principal payment of $750,000 and an interest payment of $81,339. In October 2019, the Company made a principal payment of $750,000 and an interest payment of $70,017. The remaining principal due as of the date of this filing is $3,000,000. Credit Agreement In February 2019, the Company entered into a Loan and Security Agreement (the “Credit Agreement”) with Austin Financial Services, Inc. (“AFS”). The Credit Agreement provides a $4.3 million credit facility, which includes a $0.8 million term loan (the “Term Loan”) and a $3.5 million revolver (the “Revolving Loan”). As of September 30, 2019, $781,986 was outstanding on the Revolving Loan. Amounts outstanding under the revolver at any time may not exceed the sum of: (a) up to 85% of accounts receivable or such lesser percentage as AFS in its sole discretion may deem appropriate if it determines that there has been a material adverse effect; less a dilution reserve as determined by AFS in its sole good faith discretion, plus (b) the lesser of (i) up to 50% of inventory or such lesser percentage as AFS in its sole discretion may deem appropriate if it determines that there has been a material adverse effect, or (ii) the inventory sublimit, minus (c) the borrowing base reserve as may be determined from time to time by AFS. The Credit Agreement contains various restrictive covenants that, among other things, limit or restrict the ability of the borrowers to incur additional indebtedness; incur additional liens; make dividends and other restricted payments; make investments; engage in mergers, acquisitions and dispositions; make optional prepayments of other indebtedness; engage in transactions with affiliates; and enter into restrictive agreements. The Credit Agreement does not include any financial covenants. If an event of default occurs, the lenders are entitled to accelerate the advances made thereunder and exercise rights against the collateral. Borrowing under the Revolving Loan is classified as current debt as a result of the required lockbox arrangement and the subjective acceleration clause. At September 30, 2019, $781,986 of the Revolving Loan was outstanding. Also at September 30, 2019, we were in compliance with the covenants in the Credit Agreement. The interest rate for the Term Loan and the Revolving Loan is prime plus 2%. At September 30, 2019, the interest rate was 10.85%, which includes a 3.6% management fee rate. The obligations of the borrowers under the agreement are secured by a security interest in substantially all of the tangible and intangible assets of the borrowers, other than any assets owned by the borrowers that constitute real property (and fixtures affixed to such real property), certain excluded equipment, intellectual property, or aircraft. The Credit Agreement matures on February 20, 2023, subject to early termination pursuant to the terms of the agreement or extension as may be agreed by the parties. Equipment Loans The Company purchased equipment in November 2019 and entered into a note payable with a financing company for $412,000. The Company will incur an additional liability of $66,000 with the financing company when the equipment purchase is finalized at the end of November 2019. The note will have an interest rate of 7.5% and will mature in five years. The Company will pay monthly payments on this note beginning in December 2019 of approximately $10,000. |
Total Equity
Total Equity | 9 Months Ended |
Sep. 30, 2019 | |
Equity [Abstract] | |
Total Equity | NOTE 8. TOTAL EQUITY A summary of changes in total equity for the nine months ended September 30, 2019 and 2018 is presented below: Common Stock Additional Accumulated Total Shares Par Value Capital Deficit Equity Balance - December 31, 2018 25,018,098 $ 25,018 $ 39,440,611 $ (32,055,410 ) $ 7,410,219 Stock-based compensation expense 79,652 80 473,637 - 473,717 Net loss - - - (1,061,058 ) (1,061,058 ) Balance – September 30, 2019 25,097,750 $ 25,098 $ 39,914,248 $ (33,116,468 ) $ 6,822,878 Common Stock Additional Accumulated Total Shares Par Value Capital Deficit Equity Balance - December 31, 2017 24,535,334 $ 24,535 $ 38,907,864 $ (31,997,035 ) $ 6,935,364 Stock-based compensation expense 15,645 16 372,195 - 372,211 Net income - - - 1,022,912 1,022,912 Balance – September 30, 2018 24,550,979 $ 24,551 $ 39,280,059 $ (30,974,123 ) $ 8,330,487 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 9. COMMITMENTS AND CONTINGENCIES We are subject to litigation that arises from time to time in the ordinary course of our business activities. In February 2019, the Company filed a patent infringement lawsuit in the United States District Court for the Western District of Louisiana Lafayette Division asserting Stabil Drill Specialties, LLC (“Stabil Drill”) infringed on our patent that covers the Company’s well bore conditioning tool, the Drill-N-Ream. The court has ordered Stabil Drill to comply with the Company’s discovery request. As of the date of this quarterly report, the lawsuit is still in its initial stages. We cannot predict the outcome of this matter, but our legal costs could have a material effect on our financial position or results of operations in future periods. We are not currently involved in any other litigation which management believes could have a material effect on our financial position or results of operations. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Organization and Nature of Operations | Organization and Nature of Operations Superior Drilling Products, Inc. (the “Company”, “SDPI”, “we”, “our” or “us”) is an innovative drilling and completion tool technology company providing cost saving solutions that drive drilling efficiencies for the oil and natural gas drilling and completions industry. We are headquartered in Vernal, Utah with manufacturing operations both there and in Abilene, Texas. We also have offices in Saudi Arabia. Our drilling solutions include the patented Drill-N-Ream® well bore conditioning tool (“Drill-N-Ream tool”) and the patented Strider™ Drill String Oscillation System technology (“Strider technology” or “Strider”). In addition, the Company is a manufacturer and refurbisher of PDC (polycrystalline diamond compact) drill bits and other select products for a leading oil field services company. Our drill tool fabrication facilities are state-of-the-art operations, where we manufacture both our solutions for the drilling industry, as well as customers’ custom products. Our subsidiaries include (a) Superior Drilling Solutions, LLC (previously known as Superior Drilling Products, LLC), a Utah limited liability company (“SDS”), together with its wholly owned subsidiary Superior Design and Fabrication, LLC, a Utah limited liability company (“SDF”), (b) Extreme Technologies, LLC, a Utah limited liability company (“ET”), (c) Meier Properties Series, LLC, a Utah limited liability company (“MPS”), (d) Meier Leasing, LLC, a Utah limited liability company (“ML”), and (e) Hard Rock Solutions, LLC (“HR” or “Hard Rock”). |
Basis of Presentation | Basis of Presentation The Company’s consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The consolidated financial statements include the accounts of Superior Drilling Products Inc. and all of its wholly-owned subsidiaries. All significant intercompany accounts have been eliminated in consolidation. The Company does not have investments in any unconsolidated subsidiaries. In April 2012, the JOBS Act was enacted. Section 107 of the JOBS Act provides that an emerging growth company can utilize the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for implementing new or revised accounting standards. An emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to nonissuers. We have elected to delay such adoption of new or revised accounting standards, and as a result, we may not implement new or revised accounting standards on the relevant dates on which adoption of such standards is required for other issuer companies. Subject to certain conditions set forth in the JOBS Act, as an emerging growth company, we intend to rely on certain of these exemptions, including without limitation, providing an auditor’s attestation report on our system of internal controls over financial reporting pursuant to Section 404 and implementing any requirement that may be adopted regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (auditor discussion and analysis). We will remain an emerging growth company until the earliest of (i) the end of the fiscal year in which the market value of our common stock that is held by exceeds $700 million as of June 30, (ii) the end of the fiscal year in which we have total annual gross revenue of $1.07 billion or more during such fiscal year, (iii) the date on which we issue more than $1.0 billion in debt in a three-year period or (iv) January 1, 2020. |
Unaudited Interim Financial Presentation | Unaudited Interim Financial Presentation These interim consolidated condensed financial statements for the three and nine months ended September 30, 2019 and 2018, and the related footnote disclosures included herein, are unaudited. However, in the opinion of management, these unaudited interim financial statements have been prepared on the same basis as the audited financial statements, and reflect all adjustments necessary to fairly state the results for such periods. The results of operations for the three and nine months ended September 30, 2019 are not necessarily indicative of the results of operations expected for the year ended December 31, 2019. These interim consolidated condensed financial statements should be read in conjunction with the audited restated consolidated financial statements of the Company for the years ended December 31, 2018 and 2017 and the notes thereto, which were included in the Company’s Annual Report on Form 10-K/A for the year ended December 31, 2018, filed with the Securities and Exchange Commission (the “SEC”) on August 19, 2019. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts in the financial statements and accompanying notes. Actual results could differ from those estimates. Significant items subject to estimates and assumptions include the carrying amount and useful lives of property and equipment and intangible assets, impairment assessments, share-based compensation expense, and valuation allowances for accounts receivable, inventories, and deferred tax assets. |
Significant Customers | Significant Customers For the nine months ended September 30, 2019, two customers represented 94% of our total revenue during the period. For the nine months ended September 30, 2018, two customers represented 95% of our total revenue during the period. |
Significant Vendors | Significant Vendors The Company had one vendor that represented 12% of our purchases for the nine months ended September 30, 2019. This vendor had approximately $218,000 in accounts payable at September 30, 2019 and purchases in the nine months of 2019 from this vendor totaled approximately $772,000. The Company had one vendor that represented 12% of our purchases for the nine months ended September 30, 2018. This vendor had approximately $147,000 in accounts payable at September 30, 2018 and purchases in the nine months of 2018 from this vendor totaled approximately $671,000. |
Recently Issued Accounting Standards | Recently Issued Accounting Standards Standards Adopted Effective January 1, 2019, the Company adopted the accounting guidance in Accounting Standards Update (“ASU”) No. 2014-09, “ Revenue from Contracts with Customers Standards Not Yet Adopted In February 2016, the FASB issued ASU No. 2016-02, “ Leases |
Revenue (Tables)
Revenue (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Revenue Disaggregated by Revenue | Revenue disaggregated by revenue source are as follows: Nine months ended September 30, 2019 2018 Tool Revenue: Tool and product sales $ 3,358,119 $ 5,746,828 Tool rental 755,720 406,335 Other related revenue 5,098,581 4,808,908 Total Tool Revenue 9,212,420 10,962,071 Contract Services 5,443,583 3,802,506 Total Revenue $ 14,656,003 $ 14,764,577 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | Inventories are comprised of the following: September 30, 2019 December 31, 2018 Raw material $ 787,167 $ 738,330 Work in progress 125,028 217,158 Finished goods 48,135 48,135 $ 960,330 $ 1,003,623 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | Property, plant and equipment are comprised of the following: September 30, 2019 December 31, 2018 Land $ 880,416 $ 880,416 Buildings 4,741,564 4,847,778 Building improvements 755,039 755,039 Machinery and equipment 9,807,981 8,816,880 Office equipment, fixtures and software 603,358 518,806 Transportation assets 350,871 811,378 17,139,229 16,630,297 Accumulated depreciation (9,270,709 ) (8,404,288 ) $ 7,868,520 $ 8,226,009 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets | Intangible assets are comprised of the following: September 30, 2019 December 31, 2018 Developed technology $ 7,000,000 $ 7,000,000 Customer contracts 6,400,000 6,400,000 Trademarks 1,500,000 1,500,000 14,900,000 14,900,000 Accumulated amortization (12,622,222 ) (11,213,889 ) $ 2,277,778 $ 3,686,111 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | Long-term debt is comprised of the following: September 30, 2019 December 31, 2018 Real estate loans $ 3,023,436 $ 4,255,152 Hard Rock Note 3,750,000 6,000,000 Credit Agreement 1,422,442 - Machinery loans 260,678 327,879 Transportation loans 311,576 292,722 Less: Current portion (4,591,811 ) (4,578,759 ) Long-term debt, net $ 4,176,321 $ 6,296,994 |
Total Equity (Tables)
Total Equity (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Equity [Abstract] | |
Summary of Changes in Total Equity | A summary of changes in total equity for the nine months ended September 30, 2019 and 2018 is presented below: Common Stock Additional Accumulated Total Shares Par Value Capital Deficit Equity Balance - December 31, 2018 25,018,098 $ 25,018 $ 39,440,611 $ (32,055,410 ) $ 7,410,219 Stock-based compensation expense 79,652 80 473,637 - 473,717 Net loss - - - (1,061,058 ) (1,061,058 ) Balance – September 30, 2019 25,097,750 $ 25,098 $ 39,914,248 $ (33,116,468 ) $ 6,822,878 Common Stock Additional Accumulated Total Shares Par Value Capital Deficit Equity Balance - December 31, 2017 24,535,334 $ 24,535 $ 38,907,864 $ (31,997,035 ) $ 6,935,364 Stock-based compensation expense 15,645 16 372,195 - 372,211 Net income - - - 1,022,912 1,022,912 Balance – September 30, 2018 24,550,979 $ 24,551 $ 39,280,059 $ (30,974,123 ) $ 8,330,487 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Annual gross revenues | $ 1,070,000,000 | ||
Non-convertible debt | $ 1,000,000,000 | ||
Debt term | 3 years | ||
Debt maturity date | Jan. 1, 2020 | ||
Accounts payable | $ 1,274,041 | $ 721,361 | |
Two Customers [Member] | Revenue [Member] | |||
Concentration risk percentage | 94.00% | 95.00% | |
One Vendor [Member] | |||
Concentration risk percentage | 12.00% | 12.00% | |
Vendor [Member] | |||
Accounts payable | $ 218,000 | $ 147,000 | |
Purchases of goods | 772,000 | $ 671,000 | |
Maximum [Member] | Non-affiliates [Member] | |||
Market value of common stock | $ 700,000,000 |
Revenue (Details Narrative)
Revenue (Details Narrative) | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Description of payment terms | All of our contracts are less than one year in duration. We do not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed. | |
Tool Revenue [Member] | ||
Revenue agreement, description | While the duration of the rents vary by job and number of runs, these rents are generally less than one month. The rental agreements are typically based on the price per run or footage drilled and do not have any minimum rental payments or term. | |
Revenue [Member] | United States [Member] | ||
Concentration risk percentage of revenue | 95.00% | 98.00% |
Revenue [Member] | Middle East [Member] | ||
Concentration risk percentage of revenue | 5.00% | 2.00% |
Revenue - Schedule of Revenue
Revenue - Schedule of Revenue Disaggregated by Revenue (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Total Revenue | $ 5,076,215 | $ 4,765,361 | $ 14,656,003 | $ 14,764,577 |
Tools and Product Sales [Member] | ||||
Total Revenue | 3,358,119 | 5,746,828 | ||
Tool Rental [Member] | ||||
Total Revenue | 755,720 | 406,335 | ||
Other Related Revenue [Member] | ||||
Total Revenue | 5,098,581 | 4,808,908 | ||
Tool Revenue [Member] | ||||
Total Revenue | 3,194,999 | 3,361,182 | 9,212,420 | 10,962,071 |
Contract Services [Member] | ||||
Total Revenue | $ 1,881,216 | $ 1,404,179 | $ 5,443,583 | $ 3,802,506 |
Inventories - Schedule of Inven
Inventories - Schedule of Inventories (Details) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Inventory Disclosure [Abstract] | ||
Raw material | $ 787,167 | $ 738,330 |
Work in progress | 125,028 | 217,158 |
Finished goods | 48,135 | 48,135 |
Inventories, net | $ 960,330 | $ 1,003,623 |
Property, Plant and Equipment_2
Property, Plant and Equipment (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation expense related to property, plant and equipment | $ 446,888 | $ 330,806 | $ 1,271,737 | $ 985,183 |
Property, Plant and Equipment -
Property, Plant and Equipment - Schedule of Property, Plant and Equipment (Details) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment [Abstract] | ||
Land | $ 880,416 | $ 880,416 |
Buildings | 4,741,564 | 4,847,778 |
Building improvements | 755,039 | 755,039 |
Machinery and equipment | 9,807,981 | 8,816,880 |
Office equipment, fixtures and software | 603,358 | 518,806 |
Transportation assets | 350,871 | 811,378 |
Property, plant and equipment, gross | 17,139,229 | 16,630,297 |
Accumulated depreciation | (9,270,709) | (8,404,288) |
Property, plant and equipment, net | $ 7,868,520 | $ 8,226,009 |
Intangible Assets (Details Narr
Intangible Assets (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization of intangible assets | $ 291,667 | $ 611,667 | $ 1,408,333 | $ 1,835,000 |
Intangible Assets - Schedule of
Intangible Assets - Schedule of Intangible Assets (Details) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | $ 14,900,000 | $ 14,900,000 |
Accumulated amortization | (12,622,222) | (11,213,889) |
Intangible assets, net | 2,277,778 | 3,686,111 |
Developed Technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | 7,000,000 | 7,000,000 |
Customer Contracts [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | 6,400,000 | 6,400,000 |
Trademarks [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | $ 1,500,000 | $ 1,500,000 |
Related Party Note Receivable (
Related Party Note Receivable (Details Narrative) - USD ($) | Aug. 31, 2017 | Jan. 31, 2014 | Sep. 30, 2019 |
Debt maturity date | Jan. 1, 2020 | ||
Tronco Energy Corporation [Member] | |||
Related party note receivable | $ 6,979,043 | ||
Debt instrument decrease | $ 0 | ||
Number of collateral shares | 8,267,860 | ||
Debt maturity date | Dec. 31, 2022 | ||
Debt interest rate | 5.50% |
Long-Term Debt (Details Narrati
Long-Term Debt (Details Narrative) - USD ($) | Feb. 01, 2019 | Oct. 31, 2019 | Jul. 31, 2019 | Apr. 30, 2019 | Jan. 31, 2019 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2014 | Feb. 28, 2019 | Dec. 31, 2018 |
Debt instrument | $ 3,000,000 | |||||||||
Previous debt payment paid | $ 70,103 | |||||||||
Debt instrument maturity date | Jan. 1, 2020 | |||||||||
Debt instrument, principal payments | $ 750,000 | $ 750,000 | $ 750,000 | |||||||
Debt instrument, interest payment | $ 81,339 | $ 88,639 | $ 183,411 | |||||||
Additional liability | $ 7,476,117 | $ 5,931,980 | ||||||||
Debt Instrument term | 3 years | |||||||||
Loan and Security Agreement [Member] | ||||||||||
Debt instrument maturity date | Feb. 20, 2023 | |||||||||
Line of credit interest rate | 3.60% | |||||||||
Loan and Security Agreement [Member] | Term Loan [Member] | Prime Rate [Member] | ||||||||||
Line of credit interest rate | 2.00% | |||||||||
Loan and Security Agreement [Member] | Revolving Loan [Member] | Prime Rate [Member] | ||||||||||
Line of credit interest rate | 10.85% | |||||||||
Loan and Security Agreement [Member] | Austin Financial Services, Inc. [Member] | ||||||||||
Long term line of credit | $ 4,300,000 | |||||||||
Loan and Security Agreement [Member] | Austin Financial Services, Inc. [Member] | Term Loan [Member] | ||||||||||
Long term line of credit | 800,000 | |||||||||
Loan and Security Agreement [Member] | Austin Financial Services, Inc. [Member] | Revolving Loan [Member] | ||||||||||
Long term line of credit | $ 3,500,000 | |||||||||
Loan outstanding amount | $ 781,986 | |||||||||
Line of credit facility description | Amounts outstanding under the revolver at any time may not exceed the sum of: (a) up to 85% of accounts or such lesser percentage as AFS in its sole discretion may deem appropriate if it determines that there has been a material adverse effect; less a dilution reserve as determined by AFS in its sole good faith discretion, plus (b) the lesser of (i) up to 50% of inventory or such lesser percentage as AFS in its sole discretion may deem appropriate if it determines that there has been a material adverse effect, or (ii) the inventory sublimit, minus (c) the borrowing base reserve as may be determined from time to time by AFS. | |||||||||
Current borrowing | $ 1,000,000 | |||||||||
Accrued interest | 16,000 | |||||||||
Loan and Security Agreement [Member] | Austin Financial Services, Inc. [Member] | Revolving Loan One [Member] | ||||||||||
Loan outstanding amount | $ 2,868,144 | |||||||||
Line of credit facility description | Amounts outstanding on the Revolving Loan as of June 30, 2019, may not exceed $2,727,667, which is based on a calculation applying 85% of accounts receivable and 50% of inventory. | |||||||||
Credit Agreement [Member] | Revolving Loan [Member] | ||||||||||
Long term line of credit | $ 781,986 | |||||||||
Subsequent Event [Member] | ||||||||||
Debt instrument, principal payments | $ 750,000 | |||||||||
Debt instrument, interest payment | $ 70,017 | |||||||||
Commercial Bank Loan [Member] | ||||||||||
Debt instrument | $ 3,129,861 | |||||||||
Previous debt payment paid | 1,000,000 | |||||||||
Debt instrument, periodic principal payments including interest | $ 43,000 | |||||||||
Debt instrument, interest rate | 7.25% | |||||||||
Debt instrument, maturity date description | We paid $1,000,000 towards the previous loan that was scheduled to mature on February 15, 2019, upon refinancing. | |||||||||
Debt balloon payment | $ 2,500,000 | |||||||||
Debt instrument maturity date | Feb. 15, 2021 | |||||||||
Hard Rock Note [Member] | ||||||||||
Business combination, consideration transferred, liabilities incurred | $ 12,500,000 | |||||||||
Payments to acquire businesses, gross | $ 12,500,000 | |||||||||
Hard Rock Note [Member] | January 5, 2019 [Member] | ||||||||||
Debt instrument, periodic principal payments including interest | 750,000 | |||||||||
Hard Rock Note [Member] | January 5, 2020 [Member] | ||||||||||
Debt instrument, periodic principal payments including interest | 750,000 | |||||||||
Hard Rock Note [Member] | April 5, 2019 [Member] | ||||||||||
Debt instrument, periodic principal payments including interest | 750,000 | |||||||||
Hard Rock Note [Member] | April 5, 2020 [Member] | ||||||||||
Debt instrument, periodic principal payments including interest | 750,000 | |||||||||
Hard Rock Note [Member] | July 5, 2019 [Member] | ||||||||||
Debt instrument, periodic principal payments including interest | 750,000 | |||||||||
Hard Rock Note [Member] | July 5, 2020 [Member] | ||||||||||
Debt instrument, periodic principal payments including interest | 750,000 | |||||||||
Hard Rock Note [Member] | October 5, 2019 [Member] | ||||||||||
Debt instrument, periodic principal payments including interest | 750,000 | |||||||||
Hard Rock Note [Member] | October 5, 2020 [Member] | ||||||||||
Debt instrument, periodic principal payments including interest | 750,000 | |||||||||
Equipment Loans [Member] | ||||||||||
Debt instrument, periodic principal payments including interest | $ 10,000 | |||||||||
Debt instrument, interest rate | 7.50% | |||||||||
Notes payable | $ 412,000 | |||||||||
Additional liability | $ 66,000 | |||||||||
Debt Instrument term | 5 years |
Long-Term Debt - Schedule of Lo
Long-Term Debt - Schedule of Long-term Debt Instruments (Details) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Current portion | $ (4,591,811) | $ (4,578,759) |
Long-term debt, net | 4,176,321 | 6,296,994 |
Real Estate Loans [Member] | ||
Long term debt, Total | 3,023,436 | 4,255,152 |
Hard Rock Note [Member] | ||
Long term debt, Total | 3,750,000 | 6,000,000 |
Credit Agreement [Member] | ||
Long term debt, Total | 1,422,442 | |
Machinery Loans [Member] | ||
Long term debt, Total | 260,678 | 327,879 |
Transportation Loans [Member] | ||
Long term debt, Total | $ 311,576 | $ 292,722 |
Total Equity - Summary of Chang
Total Equity - Summary of Changes in Total Equity (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Balance | $ 7,410,219 | |||
Net income (loss) | $ (417,758) | $ 127,705 | (1,061,058) | $ 1,022,912 |
Balance | 6,822,878 | 6,822,878 | ||
Common Stock [Member] | ||||
Balance | $ 25,018 | $ 24,535 | ||
Balance, shares | 25,018,098 | 24,535,334 | ||
Stock-based compensation expense | $ 80 | $ 16 | ||
Stock-based compensation expense, shares | 79,652 | 15,645 | ||
Net income (loss) | ||||
Balance | $ 25,098 | $ 24,551 | $ 25,098 | $ 24,551 |
Balance, shares | 25,097,750 | 24,550,979 | 25,097,750 | 24,550,979 |
Additional Paid-in Capital [Member] | ||||
Balance | $ 39,440,611 | $ 38,907,864 | ||
Stock-based compensation expense | 473,637 | 372,195 | ||
Net income (loss) | ||||
Balance | $ 39,914,248 | $ 39,280,059 | 39,914,248 | 39,280,059 |
Accumulated Deficit [Member] | ||||
Balance | (32,055,410) | (31,997,035) | ||
Stock-based compensation expense | ||||
Net income (loss) | (1,061,058) | 1,022,912 | ||
Balance | (33,116,468) | (30,974,123) | (33,116,468) | (30,974,123) |
Total Shareholders Equity [Member] | ||||
Balance | 7,410,219 | 6,935,364 | ||
Stock-based compensation expense | 473,717 | 372,211 | ||
Net income (loss) | (1,061,058) | 1,022,312 | ||
Balance | $ 6,822,878 | $ 8,330,487 | $ 6,822,878 | $ 8,330,487 |