Note 4 - Investment Unit	12 Months Ended
Dec. 31, 2019
Notes to Financial Statements
Investment Unit [Text Block]	Note 4 – Investment Unit The Texas Emerging Technology Fund (“TETF”) was created as an incentive for economic development to the Texas economy by providing financial support that leverages private investment for the creation of high-quality technology jobs in Texas. The award received required us to comply with certain performance conditions to ensure the monies the Company received were used for development activities in the state of Texas, and that we maintained our corporate nexus in Texas. Further, in connection with the award, the Company issued an Investment Unit to the TETF. On September 25, 2017 and again on August 16, 2019, the Company entered into Termination Agreements with the Texas Treasury Safekeeping Trust Company ("TTSTC"), the entity managing and controlling TETF interests, that terminated Article II and the all remaining Articles of the Investment Unit, respectively, so that the entirety of the Investment Unit was effectively terminated. As further described below, the Investment Unit consisted of a Promissory Note and a Right to Purchase. Promissory Note The Promissory Note was an obligation to repay the $4.5 million principal amount, with interest accrued at 8% per annum, but only if an event of default occurred prior to August 13, 2020. If no event of default occurred prior to August 13, 2020, the Promissory Note and all related interest would be cancelled. Consistent with the stated objectives of the TETF, an event of default that would trigger the repayment obligation under the Promissory Note was a failure to maintain our principal place of business or our principal executive offices headquartered in the State of Texas (referred to as the “Residency Requirement”) until August 13, 2020. Warrant The Warrant was an obligation to issue (a Right to purchase by the TETF) shares of the same class of stock to be issued in a “First Qualifying Financing Transaction,” at 80% of the per share transaction value (effectively a 20% discount). Alternatively, the TETF could exercise its right to purchase at any time prior to the occurrence of a First Qualifying Financial Transaction for $0.001 per share. The Warrant included a provision that required changes in the strike price, driven by the pricing of the “First Qualifying Financing Transaction.” As a result, the Warrant embedded in the Investment Unit was accounted for as a derivative financial instrument and classified outside of equity under ASC 815 - 40 - 15 as the settlement adjustment from the future transaction did not permit for the strike price to be considered fixed. On March 12, 2014, the TETF exercised its Right to Purchase for $0.001 per share, and we issued to the TETF an aggregate of 184,797 shares of our Series B preferred stock. These shares were subsequently forward-split and converted to 1,235,219 shares of Common Stock in connection with our IPO. Accounting for the Investment Unit We accounted for the Investment Unit as a hybrid financial instrument under FASB Statement 155, and measured the Investment Unit at the amount of proceeds received from the TETF award. The First Qualifying Financial Transaction occurred during December 2013, resulting in an adjustment to the fair value of the Investment Unit in the amount of approximately $2.5 million. The TETF exercised the Warrant for $0.001 per share. We received notice of purchase from the TETF during March 2014, and issued 184,797 shares of Series B Preferred Stock, which has since been converted to 1,235,219 shares of Common Stock upon completion of the Company’s IPO. Upon exercise by the TETF of the Warrant, the remaining component within the Investment Unit was the Promissory Note. The Investment Unit was valued at zero, because our obligation to repay the Promissory Note arose from an event of default (a failure to maintain the Texas Residency Requirement), which was an event which rested entirely within our control.

Note

– Investment Unit

The Texas Emerging Technology Fund (“TETF”) was created as an incentive for economic development to the Texas economy by providing financial support that leverages private investment for the creation of high-quality technology jobs in Texas. The award received required us to comply with certain performance conditions to ensure the monies the Company received were used for development activities in the state of Texas, and that we maintained our corporate nexus in Texas. Further, in connection with the award, the Company issued an Investment Unit to the TETF. On

September 25, 2017

and again on

August 16, 2019,

the Company entered into Termination Agreements with the Texas Treasury Safekeeping Trust Company ("TTSTC"), the entity managing and controlling TETF interests, that terminated Article II and the all remaining Articles of the Investment Unit, respectively, so that the entirety of the Investment Unit was effectively terminated. As further described below, the Investment Unit consisted of a Promissory Note and a Right to Purchase.

Promissory Note

The Promissory Note was an obligation to repay the

$4.5

million principal amount, with interest accrued at

per annum, but only if an event of default occurred prior to

August 13, 2020.

event of default occurred prior to

August 13, 2020,

the Promissory Note and all related interest would be cancelled.

Consistent with the stated objectives of the TETF, an event of default that would trigger the repayment obligation under the Promissory Note was a failure to maintain our principal place of business or our principal executive offices headquartered in the State of Texas (referred to as the “Residency Requirement”) until

August 13, 2020.

Warrant

The Warrant was an obligation to issue (a Right to purchase by the TETF) shares of the same class of stock to be issued in a “First Qualifying Financing Transaction,” at

80%

of the per share transaction value (effectively a

20%

discount). Alternatively, the TETF could exercise its right to purchase at any time prior to the occurrence of a First Qualifying Financial Transaction for

$0.001

per share.

The Warrant included a provision that required changes in the strike price, driven by the pricing of the “First Qualifying Financing Transaction.” As a result, the Warrant embedded in the Investment Unit was accounted for as a derivative financial instrument and classified outside of equity under ASC

815

as the settlement adjustment from the future transaction did

not

permit for the strike price to be considered fixed.

March 12, 2014,

the TETF exercised its Right to Purchase for

$0.001

per share, and we issued to the TETF an aggregate of

184,797

shares of our Series B preferred stock. These shares were subsequently forward-split and converted to

1,235,219

shares of Common Stock in connection with our IPO.

Accounting for the Investment Unit

We accounted for the Investment Unit as a hybrid financial instrument under FASB Statement

155,

and measured the Investment Unit at the amount of proceeds received from the TETF award. The First Qualifying Financial Transaction occurred during

December 2013,

resulting in an adjustment to the fair value of the Investment Unit in the amount of approximately

$2.5

million. The TETF exercised the Warrant for

$0.001

per share. We received notice of purchase from the TETF during

March 2014,

and issued

184,797

shares of Series B Preferred Stock, which has since been converted to

1,235,219

shares of Common Stock upon completion of the Company’s IPO. Upon exercise by the TETF of the Warrant, the remaining component within the Investment Unit was the Promissory Note. The Investment Unit was valued at zero, because our obligation to repay the Promissory Note arose from an event of default (a failure to maintain the Texas Residency Requirement), which was an event which rested entirely within our control.