10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

[X] Quarterly Report pursuant to Section 13 or 15 (d) of the Securities Exchange Act of 1934

For the quarterly period ended June 30, 2017

[  ] Transition Report pursuant to Section 13 or 15 (d) of the Securities Exchange Act of 1934

For the transition period from _____ to _____

Commission File Number 1-10869

                UQM TECHNOLOGIES, INC.                

(Exact name of registrant, as specified in its charter)

Colorado	84-0579156
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

    4120 Specialty Place, Longmont, Colorado 80504    

(Address of principal executive offices) (Zip code)

                                (303) 682-4900                               

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes   X   No .

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every interactive data file required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes   X    No 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company.   See definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.

[  ]  Large accelerated filer	[  ]  Accelerated filer
[  ]  Non-accelerated filer (Do not check if a smaller reporting company)	[X]  Smaller reporting company
	[  ]  Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act.)

Yes No   X  .

The number of shares outstanding (including shares held by affiliates) of the registrant’s common stock, par value $0.01 per share at August 4,  2017 was 48,643,824.

TABLE OF CONTENTS

	Page No.
PART I Financial Information	1
Item 1.   Financial Statements
Consolidated Condensed Balance Sheets as of June 30, 2017 and December 31, 2016	1
Consolidated Condensed Statements of Operations for the quarters and six months ended June 30, 2017 and 2016	3
Consolidated Condensed Statements of Cash Flows for the six months ended June 30, 2017 and 2016	4
Notes to Consolidated Condensed Financial Statements	5
Item 2.   Management’s Discussion and Analysis of Financial Condition and Results of Operations	15
Item 3.   Quantitative and Qualitative Disclosures About Market Risk	20
Item 4.   Controls and Procedures	20
PART II Other Information	20
Item 1.   Legal Proceedings	20
Item 1A. Risk Factors	20
Item 5.   Other Information	21
Item 6.   Exhibits.	22

i

Part I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

UQM TECHNOLOGIES, INC. AND SUBSIDIARIES

Consolidated Condensed Balance Sheets (unaudited)

	June 30,		December 31,
	2017		2016
Assets
Current assets:
Cash and cash equivalents	$	2,074,389	$	2,100,089
Restricted cash		165,312		-
Accounts receivable		791,918		1,163,316
Costs and estimated earnings in excess of billings on uncompleted contracts		29,917		29,917
Inventories, net		2,356,514		1,749,735
Prepaid expenses and other current assets		206,243		259,682
Total current assets		5,624,293		5,302,739
Property and equipment, at cost:
Land		896,388		1,683,330
Building		4,516,301		4,516,301
Machinery and equipment		7,090,147		7,052,740
		12,502,836		13,252,371
Less accumulated depreciation		(7,771,450)		(7,590,641)
Net property and equipment		4,731,386		5,661,730
Patent costs, net of accumulated amortization of $943,147 and $932,564, respectively		210,435		213,326
Trademark costs, net of accumulated amortization of $83,133 and $80,885, respectively		92,707		94,955
Restricted cash		420,631		-
Land held for sale		786,942		-
Total assets	$	11,866,394	$	11,272,750

See accompanying notes to consolidated condensed financial statements.

1

UQM TECHNOLOGIES, INC. AND SUBSIDIARIES

Consolidated Condensed Balance Sheets (unaudited), Continued

	June 30,		December 31,
	2017		2016
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	951,962	$	809,950
Other current liabilities		1,487,029		1,318,941
Total current liabilities		2,438,991		2,128,891
Long-term debt, net of deferred financing costs of $63,732 and $0, respectively		3,100,797		-
Other long-term liabilities		131,667		141,667
Total long-term liabilities		3,232,464		141,667
Total liabilities		5,671,455		2,270,558
Commitments and contingencies (Note 16)
Stockholders’ equity:
Common stock, $0.01 par value, 175,000,000 shares authorized; 48,566,548 and 48,519,313  shares issued and outstanding, respectively		485,665		485,193
Additional paid-in capital		128,556,455		128,409,933
Accumulated deficit		(122,847,181)		(119,892,934)
Total stockholders’ equity		6,194,939		9,002,192
Total liabilities and stockholders’ equity	$	11,866,394	$	11,272,750

See accompanying notes to consolidated condensed financial statements.

2

UQM TECHNOLOGIES, INC. AND SUBSIDIARIES

Consolidated Condensed Statements of Operations (unaudited)

	Quarters Ended June 30,				Six Months Ended June 30,
	2017		2016		2017		2016
Revenue:
Product sales	$	1,571,390	$	1,173,261	$	2,416,925	$	2,392,058
Contract services		217,565		261,820		387,075		547,313
		1,788,955		1,435,081		2,804,000		2,939,371
Operating costs and expenses:
Costs of product sales		1,006,639		759,089		1,614,488		1,568,923
Costs of contract services		80,552		236,949		161,616		540,390
Research and development		555,465		718,918		1,188,247		1,403,264
Selling, general and administrative		1,470,914		1,684,645		2,774,121		2,917,539
Recovery of impaired assets		-		-		-		(585,800)
		3,113,570		3,399,601		5,738,472		5,844,316
Loss from operations		(1,324,615)		(1,964,520)		(2,934,472)		(2,904,945)
Other income/ (expense):
Interest income		449		3,408		2,099		7,290
Interest expense		(21,363)		-		(22,731)		-
Amortization of deferred financing costs		(9,327)		-		(10,881)		-
Other		6,635		7,082		11,738		12,707
		(23,606)		10,490		(19,775)		19,997
Net loss	$	(1,348,221)	$	(1,954,030)	$	(2,954,247)	$	(2,884,948)
Net loss per common share - basic and diluted	$	(0.03)	$	(0.04)	$	(0.06)	$	(0.06)
Weighted average number of shares of common stock outstanding - basic and diluted		48,563,209		48,346,344		48,543,093		48,327,310

See accompanying notes to consolidated condensed financial statements.

3

UQM TECHNOLOGIES, INC. AND SUBSIDIARIES

Consolidated Condensed Statements of Cash Flows (unaudited)

	Six Months Ended June 30,
	2017		2016
Cash flows from operating activities:
Net loss	$	(2,954,247)	$	(2,884,948)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		204,521		384,740
Non-cash equity based compensation		128,548		103,332
Recovery of impaired assets		-		(585,800)
(Recoveries) or impairment of inventories		(57,394)		9,906
Change in operating assets and liabilities:
Accounts receivable		371,398		(16,419)
Costs and estimated earnings on uncompleted contracts		-		(41,772)
Inventories		(549,384)		(61,076)
Prepaid expenses and other current assets		43,352		24,571
Accounts payable and other current liabilities		310,100		3,525
Billings in excess of costs and estimated earnings on uncompleted contracts		-		(60,266)
Other long-term liabilities		(10,000)		83,334
Net cash used in operating activities		(2,513,106)		(3,040,873)
Cash flows from investing activities:
Acquisition of property and equipment		(37,407)		(100,515)
Cash paid for patent and trademark fees		(7,691)		(6,138)
Net cash used in investing activities		(45,098)		(106,653)
Cash flows from financing activities:
Cash received for shares exercised under employee stock purchase plan		18,447		22,386
Registered direct offering costs		-		(65,000)
Draw on line of credit		3,100,000		-
Payment of employee tax withholdings in exchange for return of common stock		-		(972)
Net cash provided / (used) by financing activities		3,118,447		(43,586)
Increase / (Decrease) in cash, cash equivalents, and restricted cash		560,243		(3,191,112)
Cash, cash equivalents, and restricted cash at beginning of period		2,100,089		8,688,668
Cash, cash equivalents, and restricted cash  at end of period	$	2,660,332	$	5,497,556

See accompanying notes to consolidated condensed financial statements.

4

UQM TECHNOLOGIES, INC. AND SUBSIDIARIES

Notes to Consolidated Condensed Financial Statements, Continued

(unaudited)

(1)   Basis of Presentation

The accompanying consolidated condensed financial statements are unaudited; however, in the opinion of management, all adjustments, which were solely of a normal recurring nature, necessary to a fair presentation of the results for the interim periods, have been made.  The results for the interim periods are not necessarily indicative of the results to be expected for the year.  The Notes contained herein should be read in conjunction with the Notes to our Consolidated Financial Statements filed on Form 10-KT for the nine-month transition period ended December 31, 2016.

(2) Segment Reporting

The Company has performed its quarterly assessment to determine if additional disclosures are required for segment reporting.  Management has determined that the Company has one operating segment because the chief operating decision maker (CODM) and management make business decisions based on product and contract services revenues taken as a whole. Therefore, no further disclosure is required at this time. Management will perform an assessment quarterly to determine if additional disclosures around this standard are needed in the future.

(3)   New Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (“FASB”) issued a new standard to achieve a consistent application of revenue recognition within the U.S., resulting in a single revenue model to be applied by reporting companies under U.S. generally accepted accounting principles. Under the new model, recognition of revenue occurs when a customer obtains control of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, the new standard requires that reporting companies disclose the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The new standard is effective for us for the first fiscal year beginning after December 15, 2017.  Earlier application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. The new standard is required to be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying it recognized at the date of initial application and providing additional disclosures. The Company currently anticipates adopting the standard using the retrospective method with the cumulative effect and additional disclosures at the period of adoption. Based on the Company’s assessment on the impact of this guidance on our consolidated condensed financial statements, we expect revenue related to product and contract services to remain substantially unchanged.

In July 2015, the FASB issued guidance on simplifying the measurement of inventory from the lower of cost or market to the lower of cost and net realizable value.  Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation.  This guidance is effective for years beginning after December 15, 2016, including interim periods within those fiscal years.  Prospective application is allowed as of the beginning of an interim or annual reporting period.  An entity is only required to disclose the nature of and reason for the change in accounting principle in the first interim and annual period of adoption.  The Company adopted this new standard in the quarter ended March 31, 2017.  There was no material impact on the consolidated financial statements upon adoption.

In March 2016, the FASB issued guidance on improvements to employee share-based payment accounting for stock compensation.  The new standard addresses the topics of accounting for income taxes, classification of excess tax benefits on the Statement of Cash Flows, forfeitures, minimum statutory tax withholding requirements, and classification of employee taxes paid on the Statement of Cash Flows when an employer withholds shares for tax withholding purposes.  This is effective for annual periods beginning after December 15, 2016 and interim periods within those annual periods.  Early adoption is permitted

5

UQM TECHNOLOGIES, INC. AND SUBSIDIARIES

Notes to Consolidated Condensed Financial Statements, Continued

(unaudited)

within any interim or annual period.  Any adjustments should be reflective as of the beginning of the fiscal year that includes that interim period.  The Company adopted this new standard in the quarter ended March 31, 2017.    No adjustments were necessary upon adoption of the standard.

In November, 2016, the FASB issued guidance on the Statement of Cash Flows and the presentation of restricted cash in the statement. The new standard will require the Statement of Cash Flows to explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash.  As a result, the amounts generally described as restricted cash should be included in the cash and cash equivalents when reconciling the beginning of the period and end of the period total amounts shown on the Statement of Cash Flows. This is effective for annual periods beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted.  The amendments should be applied using the retrospective transition method in each period presented.  The Company has elected to early adopt this standard in the quarter ended June 30, 2017.  The ending cash balance in the Consolidated Condensed Cash Flow Statement was updated to reflect the adoption of the standard.  Additional disclosure has been included in Note 5 of the Consolidated Condensed Financial Statements as required by adopting the standard.

(4)      Going Concern

These consolidated condensed financial statements are presented assuming that the Company will continue as a going concern. The going concern concept contemplates the realization of assets and satisfaction of liabilities in the normal course of business. As of June 30, 2017, the Company has sustained recurring losses from continuing operations, had working capital surplus of $3,185,302, and accumulated deficit of $122,847,181. 

On March 15, 2017, the Company entered into a non-revolving line of credit for $5.6 million.  The interest rate is variable based upon the one month LIBOR rate plus 4.0% per annum on the outstanding balance.  The non-revolving line of credit will expire on March 15, 2019 and the amounts repaid during the term of the loan may not be re-borrowed. At the expiry date, all outstanding principal and interest are due. As of June 30, 2017, $3,164,529 was drawn on the line of credit.

Based on management’s projections of operations and the non-revolving line of credit, the Company believes that it currently has sufficient cash and bank financing resources to support day to day activities through operations as they become due and sustain operations for at least the next twelve months.

6

UQM TECHNOLOGIES, INC. AND SUBSIDIARIES

Notes to Consolidated Condensed Financial Statements, Continued

(unaudited)

(5)   Cash, cash equivalents, and restricted cash

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported on the Consolidated Condensed Balance Sheet to the cash on the Consolidated Condensed Statement of Cash Flows.

	June 30,		December 31,
	2017		2016
Cash and cash equivalents	$	2,074,389	$	2,100,089
Restricted cash		165,312		-
Restricted cash included in other long-term assets		420,631		-
Total cash, cash equivalents, and restricted cash shown in the Consolidated Condensed Statement of Cash Flows	$	2,660,332	$	2,100,089

Restricted cash classified as a current asset on the Consolidated Condensed Balance Sheet represents the amount required to be set aside pursuant to a contractual agreement with the Company’s lender for the payment of interest on borrowings from the line of credit that is expected to be paid within the next twelve months.   In addition, restricted cash included in other long-term assets on the Consolidated Condensed Balance Sheet represents interest due on the line of credit more than twelve months from the date of the financial statements as contractually required by the lender.  The restrictions will lapse when the related long-term debt is paid off.

(6)   Contracts in Process

At June 30, 2017 and December 31, 2016, the estimated period to complete contracts in process ranged from one month and one to six months, respectively.  We expect to collect all accounts receivable arising from these contracts within sixty days of billing.

The following summarizes contracts in process:

	June 30,		December 31,
	2017		2016
Costs incurred on uncompleted contracts	$	502,701	$	502,701
Estimated earnings		331,969		331,969
		834,670		834,670
Less billings to date		(804,753)		(804,753)
Contracts in process	$	29,917	$	29,917
Included in the accompanying Consolidated Condensed Balance Sheets is as follows:
Costs and estimated earnings in excess of billings on uncompleted contracts	$	29,917	$	29,917
Contracts in process	$	29,917	$	29,917

7

UQM TECHNOLOGIES, INC. AND SUBSIDIARIES

Notes to Consolidated Condensed Financial Statements, Continued

(unaudited)

(7)   Inventories

Inventories at June 30, 2017 and December 31, 2016 consisted of:

	June 30,		December 31,
	2017		2016
Raw materials	$	7,626,365	$	7,279,855
Work-in-process		370,579		105,252
Finished products		1,466,849		1,531,544
Reserve for excess and obsolete inventory		(7,107,279)		(7,166,916)
	$	2,356,514	$	1,749,735

We maintain raw material inventories of electronic components, motor parts and other materials to meet our expected manufacturing needs for proprietary products and for products manufactured to the design specifications of our customers. Some of these components may become obsolete or impaired due to bulk purchases in excess of customer requirements. Accordingly, we periodically assess our raw material and finished product inventories for potential impairment of value based on then available information, expectations and estimates and establish impairment reserves as appropriate.

As of December 31, 2016, we re-evaluated the carrying value of our PowerPhase Pro® product.  A key factor in our analysis during the nine-month transition period ended December 31, 2016 was that in October 2016, our customer, ITL Efficiency Corporation, informed us of their intention to purchase in cash a significant portion of the PowerPhase Pro® inventory by the filing date of our Form 10-KT for the nine-month transition period ended December 31, 2016.  That payment had not at that point in time been received.  Because of the long delays in this customer’s product launch and the lack of a significant cash payment towards this inventory, we determined that approximately $6.8 million of this inventory be reserved as excess inventory and we took a charge for this amount against this inventory as of December 31, 2016.  We have purchase orders from existing customers to acquire the remaining balance of the PowerPhase Pro® inventory. We also reserved approximately $350,000 for other obsolete inventory as of December 31, 2016.

During the six months ended June 30, 2017, we recovered $57,394 of the reserve due to parts being used in production of units to be sold or repaired for customers.  

(8)   Other Current Liabilities

Other current liabilities at June 30, 2017 and December 31, 2016 consisted of:

	June 30,		December 31,
	2017		2016
Accrued payroll and employee benefits	$	129,359	$	62,220
Accrued personal property and real estate taxes		119,936		232,326
Accrued warranty costs		305,983		289,710
Unearned revenue		236,575		116,886
Accrued royalties		48,336		48,336
Accrued import duties		87,100		87,100
Accrued vendor settlements		189,175		189,175
Accrued executive compensation		350,000		272,222
Other		20,565		20,966
	$	1,487,029	$	1,318,941

8

UQM TECHNOLOGIES, INC. AND SUBSIDIARIES

Notes to Consolidated Condensed Financial Statements, Continued

(unaudited)

(9)  Debt

On March 15, 2017, the Company entered into a non-revolving line of credit for $5.6 million.  The loan is collateralized by the Company’s headquarters facility.  The interest rate is variable based upon the one month LIBOR rate plus 4.0% per annum on the outstanding balance which was 5.22% as of June 30, 2017.    As a of condition of the loan,  $600,000 was immediately drawn on the line of credit to be used for monthly interest payments on borrowings over the life of the loan.  This is reported as restricted cash on the Consolidated Condensed Balance Sheet as of June 30, 2017.  For additional information, see Note 5 to the Consolidated Condensed Financial Statements.  The covenants under the debt agreement require the Company to have liquid assets of a minimum of $1.5 million with the lender.  In addition, financial statements are to be presented no later than 45 days after the end of each quarter and 90 days after the end of each fiscal year.  These covenants took effect for the quarter ending June 30, 2017.  As of June 30, 2017, the Company was in compliance with its covenants. The non-revolving line of credit will expire on March 15, 2019 and the amounts repaid during the term of the loan may not be re-borrowed. At the expiry date, all outstanding principal and interest are due. As of June 30, 2017, $3,164,529 was drawn on the line of credit.  The Company incurred deferred financing costs of $73,060 upon securing the line of credit.

(10)   Stock-Based Compensation

Share-Based Compensation Expense

The table below shows total share-based compensation expense for the quarters and six months ended June 30, 2017 and 2016 and the classification of these expenses:

	Quarters Ended June 30,				Six Months Ended June 30,
	2017		2016		2017		2016
Costs of product sales	$	4,391	$	2,974	$	7,327	$	5,254
Costs of contract services		1,280		2,409		2,097		4,335
Research and development		10,293		6,817		18,901		11,412
Selling, general and administrative		51,019		41,564		100,223		82,331
	$	66,983	$	53,764	$	128,548	$	103,332

9

UQM TECHNOLOGIES, INC. AND SUBSIDIARIES

Notes to Consolidated Condensed Financial Statements, Continued

(unaudited)

Stock Option Plans Activity

Additional information with respect to stock option activity during the six months ended June 30, 2017 under our Stock Option Plans is as follows:

				Weighted-
		Weighted-		Average
	Shares	Average		Remaining		Aggregate
	Under	Exercise		Contractual		Intrinsic
	Option	Price		Life		Value
Outstanding at December 31, 2016	3,004,798	$	1.20		6.4 years	$	-
Granted	-	$	-				-
Exercised	-	$	-			$	-
Forfeited	(27,003)	$	1.10			$	168
Outstanding at June 30, 2017	2,977,795	$	1.20		6.0 years	$	-
Exercisable at June 30, 2017	2,168,542	$	1.38		5.0 years	$	-
Vested and expected to vest at June 30, 2017	2,716,789	$	1.21		5.8 years	$	-

As of June 30, 2017, there was $231,388 of total unrecognized compensation cost related to stock options granted under our Stock Option Plans.  The unrecognized compensation cost is expected to be recognized over a weighted-average period of twenty months.  The total fair value of stock options that vested during each of the six months ended June 30, 2017 and 2016 was $0 and $1,773, respectively.

Stock Bonus Plan Activity

Activity with respect to non-vested shares under the Stock Bonus Plan as of June 30, 2017 and 2016 and changes during the six months ended June 30, 2017 and 2016 are presented below:

	Six Months Ended June 30, 2017			Six Months Ended June 30, 2016
		Weighted-Average			Weighted-Average
	Shares Under	GrantDate		Shares Under	Grant Date
	Contract	Fair Value		Contract	Fair Value
Unvested at beginning of period	102,048	$	0.84	90,561	$	1.36
Granted	-	$	-	-	$	-
Vested	-	$	-	(3,667)	$	(0.69)
Forfeited	-	$	-	(3,920)	$	(1.25)
Unvested at end of period	102,048	$	0.84	82,974	$	1.39

As of June 30, 2017, there was $39,908 of total unrecognized compensation cost related to common stock granted under our Stock Bonus Plan.  The unrecognized compensation cost at June 30, 2017 is expected to be recognized over a weighted-average period of twenty months.

10

UQM TECHNOLOGIES, INC. AND SUBSIDIARIES

Notes to Consolidated Condensed Financial Statements, Continued

(unaudited)

Employee Stock Purchase Plan Activity

During the three months ended June 30, 2017 and 2016, we issued 43,412 and 18,097 shares of common stock, respectively, under the Employee Stock Purchase Plan.  Cash received by us upon the purchase of shares under the Employee Stock Purchase Plan for the three months ended June 30, 2017 and 2016 was $16,497 and $9,591, respectively. As of June 30, 2017, 46,439 options had been purchased under this plan but the employee(s) had not exercised their right to acquire the common stock under the terms of the Employee Stock Purchase Plan.

(11)   Stockholders’ Equity

Changes in the components of stockholders’ equity during the six months ended June 30, 2017 were as follows:

	Number of
	common				Additional				Total
	shares		Common		paid-in		Accumulated		stockholders’
	issued		stock		capital		deficit		equity
Balances at December 31, 2016		48,519,313	$	485,193	$	128,409,933	$	(119,892,934)	$	9,002,192
Issuance of common stock under employee stock purchase plan		3,823		38		1,912		-		1,950
Compensation expense from employee and director stock option and common stock grants		-		-		61,564		-		61,564
Net loss		-		-		-		(1,606,026)		(1,606,026)
Balances at March 31, 2017		48,523,136	$	485,231	$	128,473,409	$	(121,498,960)	$	7,459,680
Issuance of common stock under employee stock purchase plan		43,412		434		16,062		-		16,496
Compensation expense from employee and director stock option and common stock grants				-		66,984		-		66,984
Net loss		-		-		-		(1,348,221)		(1,348,221)
Balances at June 30, 2017		48,566,548	$	485,665	$	128,556,455	$	(122,847,181)	$	6,194,939

The Company has warrants outstanding as follows:

	Common Stock	Warrants
	Follow-on Offering	Under Option	Earliest
Offering Date	(Shares)	(Shares)	Exercise Date	Expiration Date
February, 2014	2,864,872	1,489,733	August 6, 2014	August 5, 2018
October, 2015	8,000,000	4,000,000	April 30, 2016	October 30, 2020
	10,864,872	5,489,733

11

UQM TECHNOLOGIES, INC. AND SUBSIDIARIES

Notes to Consolidated Condensed Financial Statements, Continued

(unaudited)

				Weighted-
		Weighted-		Average
	Warrants	Average		Remaining
	Under	Exercise		Contractual
	Option	Price		Life
Outstanding at December 31, 2016	5,489,733	$	1.53		3.3 years
Granted	-	$	-
Exercised	-	$	-
Forfeited	-	$	-
Outstanding at June 30, 2017	5,489,733	$	1.53		2.8 years
Exercisable at June 30, 2017	5,489,733	$	1.53		2.8 years

(12)   Significant Customers 

We have historically derived significant revenue from a few key customers.  The following table summarizes revenue and percent of total revenue from significant customers for the quarters and six months ended June 30, 2017 and 2016:

	Quarter Ended June 30,								Six Months Ended June 30,
	2017				2016				2017				2016
Customer A	$	847,601	47	%	$	353,435	25	%	$	1,406,535	50	%	$	763,655	26	%
Customer B	$	211,000	12	%	$	-	-	%	$	300,000	11	%	$	-	-	%
Customer C	$	224,730	13	%	$	12,212	1	%	$	224,730	8	%	$	45,897	2	%
Customer D	$	142,334	8	%	$	225,105	16	%	$	175,138	6	%	$	358,010	12	%
Customer E	$	32,270	2	%	$	109,431	8	%	$	34,282	1	%	$	296,231	10	%
Customer F	$	-	-	%	$	250,519	17	%	$	-	-	%	$	536,013	18	%

The following table summarizes accounts receivable from significant customers as of June 30, 2017 and December 31, 2016:

	June 30,		December 31,
	2017		2016
Customer A	61	%	45	%
Customer B	-	%	-	%
Customer C	20	%	29	%
Customer D	15	%	10	%
Customer E	2	%	11	%
Customer F	-	%	-	%

12

UQM TECHNOLOGIES, INC. AND SUBSIDIARIES

Notes to Consolidated Condensed Financial Statements, Continued

(unaudited)

(13) Income Taxes

The Company currently has a full valuation allowance against its deferred tax assets, as it is management’s judgment that it is more-likely-than-not that net deferred tax assets will not be realized to reduce future taxable income.

As of June 30, 2017 and 2016, we had no provisions for interest or penalties related to uncertain tax positions.

The Company is subject to taxation in the U.S. and various state jurisdictions. As of June 30, 2017, the Company’s tax years for 2012 to 2016 are subject to examination by the tax authorities.

(14) Loss Per Common Share

The following table sets forth the computation of basic and diluted net loss per share for the quarters and six months ended June 30, 2017 and 2016:

	Quarter Ended June 30,				Six Months Ended June 30,
	2017		2016		2017		2016
Numerator:
Net loss	$	(1,348,221)	$	(1,954,030)	$	(2,954,247)	$	(2,884,948)
Denominator for basic and diluted net loss per common  share:
Weighted average number of shares of common stock outstanding - basic and diluted		48,563,209		48,346,344		48,543,093		48,327,310
Net loss per common share - basic and diluted	$	(0.03)	$	(0.04)	$	(0.06)	$	(0.06)

The following table sets forth the potential shares of common stock that are not included in the calculation of diluted net loss per share because to do so would be anti-dilutive as of the end of each period presented:

	June 30,
	2017		2016
Non-vested stock bonus plan shares		102,048	82,974
Stock options outstanding		3,024,234	2,488,838
Warrants to purchase common stock		5,489,733	5,489,733

(15) Fair Value of Financial Instruments

The carrying amounts of cash, cash equivalents, restricted cash, accounts receivable and accounts payable approximate fair value because of the short maturity of these instruments.

The Company measures the fair value of outstanding debt for disclosure purposes on a recurring basis and its long-term debt of $3,100,797 is reported at amortized cost.  The Company’s long-term debt is subject to variable rates of interest and accordingly its carrying value is considered to be representative of its fair market value.

13

UQM TECHNOLOGIES, INC. AND SUBSIDIARIES

Notes to Consolidated Condensed Financial Statements, Continued

(unaudited)

(16) Commitments and Contingencies

Employment Agreements

On July 21, 2015, the Company entered into new employment agreements with its four officers that expired on June 30, 2017. 

Effective July 1, 2017, the Company entered into new employment agreements with its four officers, which expire December 31, 2019.  The aggregate future base salary payable to the executive officers over their remaining terms is $2,666,260.

Litigation

We are involved in various claims and legal actions arising in the ordinary course of business.  In the opinion of management, and based on current available information, the ultimate disposition of these matters is not expected to have a material adverse effect on our financial position, results of operations or cash flow.

(17) Subsequent Event

On July 6, 2017, the Company sold 15 acres of vacant land adjacent to its manufacturing facility. The gross selling price of the land was $1.5 million (net proceeds were $1.4 million) which was representative of the fair market value.  This land is classified as held for sale on the Consolidated Condensed Balance Sheet as of June 30, 2017.

14

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This Report contains statements that constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act. These statements appear in a number of places in this Report and include statements regarding our plans, beliefs or current expectations.  Important Risk Factors that could cause actual results to differ from those contained in the forward-looking statements are listed below in Part II, Item 1A. Risk Factors and in our Transitional Report on Form 10-KT for the period nine-months ended December 31, 2016.  Additionally, there may be other risks that are otherwise described from time to time in the reports that we file with the U.S. Securities and Exchange Commission (“SEC”). We assume no obligation to update, and, except as may be required by law, do not intend to update, any forward-looking statements.

Introduction

UQM Technologies, Inc., (“UQM”, “Company”, “we”, “our”, or “us”) is a developer and manufacturer of power dense, high efficiency electric motors, generators, power electronic controllers and fuel cell compressors for the commercial truck, bus, automotive, marine, military and industrial markets. We generate revenue from three principal activities: 1) the sale of electric propulsion systems, which includes motors and controllers; and 2) the sale of auxiliary products including generators, fuel cell compressors, air conditioning compressor systems, and DC-to-DC converters; and 3) services, including research, development and application engineering contract services and remanufacturing services. Our product sales consist of annually recurring volume production, prototype low volume sales, and revenues derived from the sale of refurbished and serviced products. The sources of engineering contract revenue typically vary from year to year and individual projects may vary substantially in their periods of performance and aggregate dollar value.

We have invested considerable financial and human resources into the development of our technology and manufacturing operations. We have developed and production-validated a full range of products for use in full-electric, hybrid electric, plug-in-hybrid and fuel cell applications for the markets we serve. These products are all highly efficient permanent magnet designs and feature outstanding performance, package size and weight valued by our customers. Our production capabilities and capacity are sufficient to meet the demands of our current and future customers for the foreseeable future.  We are certified as an ISO/TS 16949 quality supplier, which is the highest level of quality standards in the automotive industry, and we are ISO 14001 certified, meeting the highest environmental standards.  We have a management team with significant experience in the automotive industry, and with the requirements for high quality production programs that our customers demand, they have very deep technical knowledge of the electric motor and controller business. This team has the ability and background to grow the business to significantly higher levels, and we believe we have adequate cash balances and bank financing resources to fund our operations for at least the next twelve months.

Our most important strategic initiative is to develop customer relationships that lead to longer-term supply contracts.  Volume production is the key to our ongoing operations.  We are driving business development in the following ways:

· We have created a well-defined, structured process to target potential customers of vehicle electric motor technology in the commercial truck/van and shuttles, passenger buses, automotive, marine, military and other targeted markets both domestically and internationally. In particular, we are focused on developing customer relationships in China which is the world’s largest market for vehicle electrification products.

· We hired our first employees in China in 2016.  As China represents the largest market in the world for electric vehicles, our presence in that market is critical to our long-term success.

· We continue to seek out a strategic partner in China that meets three important criteria; the partner should have capital, infrastructure and access to the Chinese domestic market.

· We have developed a customer pipeline where identified potential customers are synergistic and strategic in nature for longer-term growth potential.

15

· We are building long term quantifiable and sustainable relationships within the identified target markets.

· We provide service and support to our customers from pilot and test activities through commissioning processes and ultimately to volume production operations.

· We continually look for ways to improve our purchasing and manufacturing processes to develop competitive costs to ensure that our pricing to customers is market competitive.

· We provide customized solutions to meet specification requirements that some customers require.

· We participate in trade show events globally to demonstrate our products and engage with users of electric motor technology.

· We actively involve all functional groups within the Company to support the requests of our customers.

We believe that the successful execution of these activities will lead us to secure volume production commitments from customers, so that our operations will become cash flow positive and ultimately profitable.

Financial Condition

Cash and cash equivalents at June 30, 2017 were $2,074,389 and working capital was $3,185,302, compared with $2,100,089 and $3,173,848, respectively, at December 31, 2016.  The change in cash and working capital is primarily attributable to operating losses offset by draws on the line of credit.

Restricted cash at June 30, 2017 was $585,943 versus $0 at December 31, 2016.  The restricted cash is for payment of interest on the draws from the line of credit.  The current portion is for estimated interest payment due within the next twelve months.  The long-term portion is the remaining amount expected to be paid by the end of the term of the line of credit on March 15, 2019.

Accounts receivable decreased $371,398 to $791,918 at June 30, 2017 from $1,163,316 at December 31, 2016.  The decrease is primarily due to the mix in customer credit terms.  Our sales are conducted through acceptance of customer purchase orders, or in some cases, through supply agreements. For international customers and customers without an adequate credit rating or history, our typical terms require irrevocable letters of credit or cash payment in advance of delivery. For credit qualified customers, our typical terms are net 30 days. As of June 30, 2017 and December 31, 2016, we had no allowance for bad debts.

Costs and estimated earnings on uncompleted contracts was $29,917 at June 30, 2017 and December 31, 2016.

Total inventories increased $606,779 to $2,356,514 at June 30, 2017 from $1,749,735 at December 31, 2016 reflecting purchases for anticipated sales of fuel cell compressor and PP220 PowerPhase HD® systems.

Prepaid expenses and other current assets decreased to $206,243 at June 30, 2017 from $259,682 at December 31, 2016 primarily due to timing of amortization of maintenance contracts.

We invested $26,313 and $37,407 for the acquisition of property and equipment during the quarter and six months ended June 30, 2017, respectively, compared to $15,862 and $100,515 during the comparable periods last year. We believe that we have sufficient property and equipment in place to meet our production requirements for the foreseeable future.

Patent costs decreased $2,891 for the six months ended June 30, 2017 due to new patent costs offset by amortization. Trademark costs decreased $2,248 for the six months ended June 30, 2017 due to amortization.

Accounts payable increased $142,012 to $951,962 at June 30, 2017 from $809,950 at December 31, 2016, primarily due to the timing of vendor payments.

16

Other current liabilities increased to $1,487,029 at June 30, 2017 from $1,318,941 at December 31, 2016. The increase is primarily attributable to an increase in accrued executive compensation, accrued payroll and associated benefits, unearned revenue and accrued warranty costs offset by a decrease in accrued property taxes.

Long-term debt net of deferred financing costs increased $3,100,797 due to borrowings on a bank line of credit secured on March 15, 2017. For additional information, see Note 9 of the Consolidated Condensed Financial Statements.

Other long-term liabilities decreased $10,000 to $131,667 at June 30, 2017 from $141,667 at December 31, 2016 due to amortization of a license fee received from a customer under a ten-year cooperation agreement.

Common stock and additional paid-in capital were $485,665 and $128,556,455, respectively, at June 30, 2017 compared to $485,193 and $128,409,933 at December 31, 2016. The increases in common stock and additional paid-in capital were primarily attributable to the periodic expensing of non-cash share-based payments associated with option and stock grants under our equity compensation plans and the issuance of shares under the Employee Stock Purchase Plan.

Results of Operations

Quarter Ended June 30, 2017

Revenue

Product sales revenue for the current quarter increased to $1,571,390 versus $1,173,261 for the comparable quarter last year, reflecting increased shipments of PowerPhase HD® propulsion systems and fuel cell compressor systems offset by decreased shipments of auxiliary motor and PowerPhase Pro®  135 systems.

Revenue from contract services decreased to $217,565 for the quarter ended June 30, 2017 versus $261,820 for the comparable quarter last year. The decrease is primarily due to a Department of Energy grant program which expired as of September 30, 2016 and lower revenue from new contracts.

Gross Profit Margin

Gross profit margin for the quarter ended June 30, 2017 increased to 39.2 percent compared to 30.1 percent for the quarter ended June 30, 2016. Gross profit margin on product sales for the quarter this year increased slightly to 35.9 percent compared to 35.3 percent for the same quarter last year primarily due to a change in product mix. Gross profit margin on contract services increased to 63.0 percent for the quarter this year compared to 9.5 percent for the quarter ended June 30, 2016, resulting from a change in the mix of contracts in process during the quarter ended June 30, 2017 versus the comparable quarter last year.

Costs and Expenses

Research and development expenditures for the quarter ended June 30, 2017 decreased to $555,465 compared to $718,918 for the quarter ended June 30, 2016. The decrease is related to a reduction of allocated resources to internally funded projects.

Selling, general and administrative expenses for the quarter ended June 30, 2017 was $1,470,914 compared to $1,684,645 for the same quarter last year. The decrease is primarily attributable to reduced consulting and legal fees,  partially offset by new personnel and related expenses pertaining to our UQM Asia operations, in the current quarter compared to the same period last year.

Net Loss

As a result, net loss for the quarter ended June 30, 2017 was $1,348,221, or $0.03 per common share, compared to a net loss of $1,954,030, or $0.04 per common share, for the comparable quarter last year.

17

Six Months Ended June 30, 2017

Revenue

Product sales revenue for the six months increased to $2,416,925 versus $2,392,058 for the comparable period last year, reflecting increased shipments of PowerPhase HD® propulsion systems and fuel cell compressor systems offset by decreased shipments of auxiliary motor and PowerPhase Pro®  135 systems.

Revenue from contract services decreased to $387,075 at June 30, 2017 versus $547,313 for the comparable period last year. The decrease is primarily due to a Department of Energy grant program which expired as of September 30, 2016 and lower revenue from new contracts.

Gross Profit Margin

Gross profit margin for the six months ended June 30, 2017 increased to 36.7 percent compared to 28.2 percent for the six month period last year. Gross profit margin on product sales for the six months ended June 30, 2017 decreased to 33.2 percent compared to 34.4 percent for the six month period last year primarily due to a change in product mix. Gross profit margin on contract services increased to 58.3 percent for the six months ended June 30, 2017 compared to 1.3 percent for the six months last year, resulting from a change in the mix of contracts in process during the six months ended June 30, 2017 versus the comparable six months last year.

Costs and Expenses

Research and development expenditures for the six months ended June 30, 2017 decreased to $1,188,247 compared to $1,403,264 for the six months ended June 30, 2016. The decrease is related to a reduction of allocated resources for internally funded projects.

Selling, general and administrative expense net of recovery of impaired assets for the six months ended June 30, 2017 was $2,774,121compared to $2,331,739 for the same six months last year. The change is primarily attributable to new personnel and related expenses pertaining to our UQM Asia operations in the current year which is offset by a decrease in consulting and legal fees.  In addition, we recovered $585,800 in connection with a vendor settlement during the six months ended June 30, 2016.

Net Loss

As a result, net loss for the six month period ended June 30, 2017 was $2,954,247, or $0.06 per common share, compared to a net loss of $2,884,948, or $0.06 per common share, for the comparable six month period last year.

Liquidity and Capital Resources

Our cash balances and liquidity throughout the quarter ended June 30, 2017 were adequate to meet operating needs.  At June 30, 2017, we had working capital of $3,185,302 compared to $3,173,848 at December 31, 2016. The increase in working capital is primarily attributable to higher inventory purchases offset by higher accounts payable due to the timing of the vendor payments.

For the six months ended June 30, 2017, net cash used in operating activities was $2,513,106 compared to net cash used in operating activities of $3,040,873 for the comparable period last year. The change in cash used in operating activities is due to increased receipts from outstanding accounts receivable and higher inventory purchases, which was offset by a decrease in settlement of vendor liabilities.

Net cash used in investing activities for the six months ended June 30, 2017 was $45,098 compared to net cash used in investing activities of $106,653 for the comparable six months last year. The decrease for the six months ended June 30, 2017 was primarily due to reduction in expenditures for the acquisition of property and equipment.

18

Net cash provided by financing activities for the six months ended June 30, 2017 was $3,118,447 compared to net cash used in financing activities of $43,586 for the comparable period last year. The change is primarily due to borrowings on a bank line of credit secured during the six months ended June 30, 2017, partially offset by a decrease in cash received for shares exercised under the employee stock purchase plan and cash paid for the registered direct offering.

We expect to fund our operations over the next year from existing cash and cash equivalent balances, cash generated from operations, and bank financing resources.  On March 15, 2017, the Company entered into a non-revolving line of credit with a lender for $5.6 million.  The interest rate is variable based upon the one month LIBOR rate plus 4.0% per annum on the outstanding balance.  The non-revolving line of credit will expire on March 15, 2019 and the amounts repaid during the term of the loan may not be re-borrowed. At the expiry date, all outstanding principal and interest are due.     For additional information, see Note 9 of the Consolidated Condensed Financial Statements.  Although we expect to manage our operations and working capital requirements to minimize the future level of operating losses and working capital usage, our working capital requirements may increase in the future. If customer demand accelerates substantially, our working capital requirements may also increase substantially.

If our existing financial resources are not sufficient to execute our business plan, we may issue equity or debt securities in the future, although we cannot assure that we will be able to secure additional capital should it be required to implement our current business plan. In the event financing or equity capital to fund future growth is not available on terms acceptable to us, or at all, we will modify our strategy to align our operations with then available financial resources. Based on our current level of operations, current cash balance and bank credit availability, we believe we have sufficient liquidity to fund our operations for at least the next twelve months.

Contractual Obligations

The following table presents information about our contractual obligations and commitments as of June 30, 2017:

			Payments due by Period
			Less Than						More than
	Total		1 Year		2 - 3 Years		4 - 5 Years		5 Years
Purchase obligations (1)	$	1,152,757	$	1,152,757	$	—	$	—	$	—
Executive employment agreements (2)		350,000		350,000		—		—		—
Total	$	1,502,757	$	1,502,757	$	—	$	—	$	—

(1) Includes procurement of inventory to fulfill the backlog for products.

(2) Includes retention bonus payable under executive employment agreements if our officers remain employees of UQM continuously through June 30, 2017, but not annual cash compensation under the agreements.  This is reflected in other current liabilities in the accompanying Consolidated Condensed Balance Sheets.

Off-Balance Sheet Arrangements

None.

Critical Accounting Policies

The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America requires management to make judgments, assumptions and estimates that affect the dollar values reported in the consolidated condensed financial statements and accompanying notes.  Note 1 to the Consolidated Condensed Financial Statements contained in our Transitional Report on Form 10-KT for the period nine-month transition period ended December 31, 2016 describes the significant accounting policies and methods used in the preparation of the consolidated financial statements. There have been no material changes in any of our critical accounting policies during the six months ended June 30, 2017.

19

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market risk is the potential loss arising from adverse changes in market rates and prices, such as foreign currency exchange and interest rates.  We do not use financial instruments to any degree to manage these risks and do not hold or issue financial instruments for trading purposes.  All of our product sales, and related receivables are payable in U.S. dollars.

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed with the SEC) is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), as appropriate, to allow timely decisions regarding required disclosure.

As of June 30, 2017, we performed an evaluation under the supervision and with the participation of our management, including our CEO and CFO, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) under the U.S. Securities and Exchange Act of 1934 (the “Exchange Act”)).  Based on that evaluation, our management, including the CEO and CFO, concluded that our disclosure controls and procedures were effective as of June 30, 2017.

There were no changes to our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the quarter ended June 30, 2017 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Part II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Litigation

We are involved in various claims and legal actions arising in the ordinary course of business.  In the opinion of management, and based on current available information, the ultimate disposition of these matters is not expected to have a material adverse effect on our financial position, results of operations or cash flow, although adverse developments in these matters could have a material impact on a future reporting period.

ITEM 1A. RISK FACTORS

Risk Factors

Our business is subject to a number of risks and uncertainties, many of which are outside of our control. Except as indicated below, there have been no material changes in the risk factors contained in our Transitional Report on Form 10-KT for the nine-month transition period ended December 31, 2016:

We have incurred significant losses and may continue to do so.

We have incurred significant net losses as shown in the following tables:

	Six months ended June 30,		Nine months ended December 31,		Year ended March 31,
	2017		2016		2016
Net loss	$	2,954,247	$	13,017,508	$	6,938,351

20

As of June 30, 2017 and December 31, 2016, we had accumulated deficits of $122,847,181 and $119,892,934, respectively.

In the future, we plan to make additional investments in product development, facilities and equipment and incur other costs related to the commercialization of our products. As a result, we expect to continue to incur net losses for the foreseeable future.  

Our operating losses, anticipated capital expenditures and working capital requirements in the longer term may exceed our current cash balances.

Our net loss for the quarter ended June 30, 2017 was $1,348,221 versus a net loss for the comparable quarter last year of $1,954,030.  Our net loss for the nine-month transition period ended December 31, 2016 was $13,017,508. At June 30, 2017, our cash and cash equivalents totaled $2,074,389.  We expect our losses to continue for the foreseeable future. Our existing cash resources and availability under our bank line of credit are expected to be sufficient to complete our business plan for at least the next twelve months. Should those resources be insufficient, we may need to secure additional debt or equity funding, which may not be available on terms acceptable to us, if at all.

Our revenue is highly concentrated among a small number of customers.

We have historically derived a large percentage of our revenue from a small number of customers, and we expect this trend to continue.

Our customer arrangements generally have been non-exclusive, have no long-term volume commitments and are often done on a purchase order basis. Further, although we entered into a 10-year exclusive supply agreement with ITL in October 2015, the amount of revenue we will generate pursuant to the ITL Agreement is uncertain. We cannot be certain that customers that have accounted for significant revenue in past periods will continue to purchase our products. Accordingly, our revenue and results of operations may vary substantially from period to period. We are also subject to credit risk associated with the concentration of our accounts receivable from our customers. If one or more of our significant customers were to cease doing business with us, significantly reduce or delay its purchases from us or fail to pay us on a timely basis, our business, financial condition and results of operations could be materially adversely affected.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

None.

ITEM 5. OTHER INFORMATION

None.

21

ITEM 6. EXHIBITS

(a) Exhibits

31.1	Certification of Chief Executive Officer Pursuant to Exchange Act Rule 13(a)- 14(a)
31.2	Certification of Chief Financial Officer Pursuant to Exchange Ac Rule 13(a)- 14(a)
32.1	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
10.1	Employment Agreement with Joseph R. Mitchell.  ** Reference is made to Exhibit 10.1 to our report on Form 8-K, filed on July 5, 2017 (No. 1-10869), which is incorporated herein by reference.
10.2	Employment Agreement with David I. Rosenthal.  ** Reference is made to Exhibit 10.2 to our report on Form 8-K, filed on July 5, 2017 (No. 1-10869), which is incorporated herein by reference.
10.3	Employment Agreement with Adrian P. Schaffer.    ** Reference is made to Exhibit 10.3 to our report on Form 8-K, filed on July 5, 2017 (No. 1-10869), which is incorporated herein by reference.
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
	** management contract or compensation plan

22

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		UQM Technologies, Inc.
		Registrant
Date:  August 7, 2017
	/s/	DAVID I. ROSENTHAL
		David I. Rosenthal
		Treasurer and Chief Financial Officer
		(Duly Authorized Officer, Principal Financial and Accounting Officer)

23

EX-31.1

Exhibit 31.1

Certification

I, Joseph R. Mitchell, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of UQM Technologies, Inc.:

2. Based on my knowledge, this Report does not contain any untrue statement of material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Report;

3. Based on my knowledge, the financial statements, and other financial information included in this Report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this Report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this Report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this Report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this Report based on such evaluation; and

d. Disclosed in this Report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent quarter (the registrant’s fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

Date:  August 7, 2017	/s/ JOSEPH R MITCHELL
	Joseph R. Mitchell
	President and Chief Executive Officer

EX-31.2

Exhibit 31.2

Certification

I, David  I.  Rosenthal, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of UQM Technologies, Inc.:

2. Based on my knowledge, this Report does not contain any untrue statement of material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Report;

3. Based on my knowledge, the financial statements, and other financial information included in this Report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this Report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this Report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this Report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this Report based on such evaluation; and

d. Disclosed in this Report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent quarter (the registrant’s fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

Date:  August 7,   2017	/s/ DAVID I.  ROSENTHAL
	David I. Rosenthal
	Treasurer, Secretary and
	Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATE PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED

PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of UQM Technologies, Inc. (the “Company”) on Form 10-Q for the quarterly period ended June 30, 2017 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned Chief Executive Officer and Chief Financial Officer of the Company hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 that:  1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and 2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ JOSEPH R. MITCHELL

     Joseph R. Mitchell     

    President and Chief Executive Officer

/s/ DAVID I.  ROSENTHAL

    David I. Rosenthal

    Treasurer, Secretary and Chief Financial Officer

Date:  August 7, 2017

XML

Document And Entity Information - shares	6 Months Ended
	Jun. 30, 2017	Aug. 04, 2017
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2017
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2017
Entity Current Reporting Status	Yes
Entity Registrant Name	UQM TECHNOLOGIES INC
Entity Central Index Key	0000315449
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		48,643,824

XML

Consolidated Condensed Balance Sheets - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Current assets:
Cash and cash equivalents	$ 2,074,389	$ 2,100,089
Restricted cash	165,312
Accounts receivable	791,918	1,163,316
Costs and estimated earnings in excess of billings on uncompleted contracts	29,917	29,917
Inventory, Net	2,356,514	1,749,735
Prepaid expenses and other current assets	206,243	259,682
Total current assets	5,624,293	5,302,739
Property and equipment, at cost:
Land	896,388	1,683,330
Building	4,516,301	4,516,301
Machinery and equipment	7,090,147	7,052,740
Property, plant and equipment, gross	12,502,836	13,252,371
Less accumulated depreciation	(7,771,450)	(7,590,641)
Net property and equipment	4,731,386	5,661,730
Patent costs, net of accumulated amortization of $943,147 and $932,564, respectively	210,435	213,326
Trademark costs, net of accumulated amortization of $83,133 and $80,885, respectively	92,707	94,955
Restricted cash, noncurrent	420,631
Land held for sale	786,942
Total assets	11,866,394	11,272,750
Liabilities and Stockholders' Equity
Accounts payable	951,962	809,950
Other current liabilities	1,487,029	1,318,941
Total current liabilities	2,438,991	2,128,891
Long-term debt, net of deferred financing costs of $63,732 and $0, respectively	3,100,797
Other long-term liabilities	131,667	141,667
Total long-term liabilities	3,232,464	141,667
Total liabilities	5,671,455	2,270,558
Stockholders' equity:
Common stock, $0.01 par value, 175,000,000 shares authorized; 48,566,548 and 48,519,313 shares issued and outstanding, respectively	485,665	485,193
Additional paid-in capital	128,556,455	128,409,933
Accumulated deficit	(122,847,181)	(119,892,934)
Total stockholders' equity	6,194,939	9,002,192
Total liabilities and stockholders' equity	$ 11,866,394	$ 11,272,750

XML

Consolidated Condensed Balance Sheets (Parenthetical) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Consolidated Condensed Balance Sheets [Abstract]
Patent costs, accumulated amortization	$ 943,147	$ 932,564
Trademark costs, accumulated amortization	83,133	80,885
Deferred financing costs	$ 63,732	$ 0
Common stock, par value per share	$ 0.01	$ 0.01
Common stock, shares authorized	175,000,000	175,000,000
Common stock, shares issued	48,566,548	48,519,313
Common Stock, Shares, Outstanding	48,566,548	48,519,313

XML

Consolidated Condensed Statements Of Operations - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Revenue:
Product sales	$ 1,571,390	$ 1,173,261	$ 2,416,925	$ 2,392,058
Contract services	217,565	261,820	387,075	547,313
Total Revenues	1,788,955	1,435,081	2,804,000	2,939,371
Operating costs and expenses:
Costs of product sales	1,006,639	759,089	1,614,488	1,568,923
Costs of contract services	80,552	236,949	161,616	540,390
Research and development	555,465	718,918	1,188,247	1,403,264
Selling, general and administrative	1,470,914	1,684,645	2,774,121	2,917,539
Recovery of impaired assets				(585,800)
Total Costs and Expenses	3,113,570	3,399,601	5,738,472	5,844,316
Loss from operations	(1,324,615)	(1,964,520)	(2,934,472)	(2,904,945)
Other income/ (expense):
Interest income	449	3,408	2,099	7,290
Interest expense	(21,363)		(22,731)
Amortization of deferred financing costs	(9,327)		(10,881)
Other	6,635	7,082	11,738	12,707
Total nonoperating income	(23,606)	10,490	(19,775)	19,997
Net loss	$ (1,348,221)	$ (1,954,030)	$ (2,954,247)	$ (2,884,948)
Net loss per common share - basic and diluted	$ (0.03)	$ (0.04)	$ (0.06)	$ (0.06)
Weighted average number of shares of common stock outstanding - basic and diluted	48,563,209	48,346,344	48,543,093	48,327,310

XML

Consolidated Condensed Statements Of Cash Flows - USD ($)	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Cash flows from operating activities:
Net loss	$ (2,954,247)	$ (2,884,948)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	204,521	384,740
Non-cash equity based compensation	128,548	103,332
Recovery of impaired assets		(585,800)
(Recoveries) or impairment of inventories	(57,394)	9,906
Change in operating assets and liabilities:
Accounts receivable	371,398	(16,419)
Costs and estimated earnings on uncompleted contracts		(41,772)
Inventories	(549,384)	(61,076)
Prepaid expenses and other current assets	43,352	24,571
Accounts payable and other current liabilities	310,100	3,525
Billings in excess of costs and estimated earnings on uncompleted contracts		(60,266)
Other long-term liabilities	(10,000)	83,334
Net cash used in operating activities	(2,513,106)	(3,040,873)
Cash flows from investing activities:
Acquisition of property and equipment	(37,407)	(100,515)
Cash paid for patent and trademark fees	(7,691)	(6,138)
Net cash used in investing activities	(45,098)	(106,653)
Cash flows from financing activities:
Cash received for shares exercised under employee stock purchase plan	18,447	22,386
Issuance of common stock in registered direct offering, net of offering costs		(65,000)
Draw on line of credit	3,100,000
Payment of employee tax withholdings in exchange for return of common stock		(972)
Net cash provided / (used) by financing activities	3,118,447	(43,586)
Increase / (Decrease) in cash, cash equivalents, and restricted cash	560,243	(3,191,112)
Cash, cash equivalents, and restricted cash at beginning of period	2,100,089	8,688,668
Cash, cash equivalents, and restricted cash at end of period	$ 2,660,332	$ 5,497,556

XML

Basis Of Presentation

6 Months Ended

Jun. 30, 2017

Basis Of Presentation

Basis Of Presentation

(1)   Basis of Presentation

The accompanying consolidated condensed financial statements are unaudited; however, in the opinion of management, all adjustments, which were solely of a normal recurring nature, necessary to a fair presentation of the results for the interim periods, have been made.  The results for the interim periods are not necessarily indicative of the results to be expected for the year.  The Notes contained herein should be read in conjunction with the Notes to our Consolidated Financial Statements filed on Form 10-KT for the nine-month transition period ended December 31, 2016.

XML

Segement Reporting

6 Months Ended

Jun. 30, 2017

Segment Reporting

Segment Reporting

(2) Segment Reporting

The Company has performed its quarterly assessment to determine if additional disclosures are required for segment reporting.  Management has determined that the Company has one operating segment because the chief operating decision maker (CODM) and management make business decisions based on product and contract services revenues taken as a whole. Therefore, no further disclosure is required at this time. Management will perform an assessment quarterly to determine if additional disclosures around this standard are needed in the future.

XML

New Accounting Pronouncements

6 Months Ended

Jun. 30, 2017

New Accounting Pronouncements

New Accounting Pronouncements

(3)   New Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (“FASB”) issued a new standard to achieve a consistent application of revenue recognition within the U.S., resulting in a single revenue model to be applied by reporting companies under U.S. generally accepted accounting principles. Under the new model, recognition of revenue occurs when a customer obtains control of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, the new standard requires that reporting companies disclose the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The new standard is effective for us for the first fiscal year beginning after December 15, 2017.  Earlier application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. The new standard is required to be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying it recognized at the date of initial application and providing additional disclosures. The Company currently anticipates adopting the standard using the retrospective method with the cumulative effect and additional disclosures at the period of adoption. Based on the Company’s assessment on the impact of this guidance on our consolidated condensed financial statements, we expect revenue related to product and contract services to remain substantially unchanged.

In July 2015, the FASB issued guidance on simplifying the measurement of inventory from the lower of cost or market to the lower of cost and net realizable value.  Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation.  This guidance is effective for years beginning after December 15, 2016, including interim periods within those fiscal years.  Prospective application is allowed as of the beginning of an interim or annual reporting period.  An entity is only required to disclose the nature of and reason for the change in accounting principle in the first interim and annual period of adoption.  The Company adopted this new standard in the quarter ended March 31, 2017.  There was no material impact on the consolidated financial statements upon adoption.

In March 2016, the FASB issued guidance on improvements to employee share-based payment accounting for stock compensation.  The new standard addresses the topics of accounting for income taxes, classification of excess tax benefits on the Statement of Cash Flows, forfeitures, minimum statutory tax withholding requirements, and classification of employee taxes paid on the Statement of Cash Flows when an employer withholds shares for tax withholding purposes.  This is effective for annual periods beginning after December 15, 2016 and interim periods within those annual periods.  Early adoption is permitted within any interim or annual period.  Any adjustments should be reflective as of the beginning of the fiscal year that includes that interim period.  The Company adopted this new standard in the quarter ended March 31, 2017.  No adjustments were necessary upon adoption of the standard.

In November, 2016, the FASB issued guidance on the Statement of Cash Flows and the presentation of restricted cash in the statement. The new standard will require the Statement of Cash Flows to explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash.  As a result, the amounts generally described as restricted cash should be included in the cash and cash equivalents when reconciling the beginning of the period and end of the period total amounts shown on the Statement of Cash Flows. This is effective for annual periods beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted.  The amendments should be applied using the retrospective transition method in each period presented.  The Company has elected to early adopt this standard in the quarter ended June 30, 2017.  The ending cash balance in the Consolidated Condensed Cash Flow Statement was updated to reflect the adoption of the standard.  Additional disclosure has been included in Note 5 of the Consolidated Condensed Financial Statements as required by adopting the standard. 

XML

Going Concern

6 Months Ended

Jun. 30, 2017

Basis Of Presentation

Going Concern

(4)   Going Concern

These consolidated condensed financial statements are presented assuming that the Company will continue as a going concern. The going concern concept contemplates the realization of assets and satisfaction of liabilities in the normal course of business. As of June 30, 2017, the Company has sustained recurring losses from continuing operations, had working capital surplus of $3,185,302, and accumulated deficit of $122,847,181. 

On March 15, 2017, the Company entered into a non-revolving line of credit for $5.6 million.  The interest rate is variable based upon the one month LIBOR rate plus 4.0% per annum on the outstanding balance.  The non-revolving line of credit will expire on March 15, 2019 and the amounts repaid during the term of the loan may not be re-borrowed. At the expiry date, all outstanding principal and interest are due. As of June 30, 2017, $3,164,529 was drawn on the line of credit.

Based on management’s projections of operations and the non-revolving line of credit, the Company believes that it currently has sufficient cash and bank financing resources to support day to day activities through operations as they become due and sustain operations for at least the next twelve months.

XML

Cash, Cash Equivalents, and Restricted Cash

6 Months Ended

Jun. 30, 2017

Cash and Cash Equivalents [Abstract]

Cash, cash equivalents, and restricted cash

(5)   Cash, cash equivalents, and restricted cash

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported on the Consolidated Condensed Balance Sheet to the cash on the Consolidated Condensed Statement of Cash Flows.

	June 30,		December 31,
	2017		2016
Cash and cash equivalents	$	2,074,389	$	2,100,089
Restricted cash		165,312		-
Restricted cash included in other long-term assets		420,631		-
Total cash, cash equivalents, and restricted cash shown in the Consolidated Condensed Statement of Cash Flows	$	2,660,332	$	2,100,089

Restricted cash classified as a current asset on the Consolidated Condensed Balance Sheet represents the amount required to be set aside pursuant to a contractual agreement with the Company’s lender for the payment of interest on borrowings from the line of credit that is expected to be paid within the next twelve months.   In addition, restricted cash included in other long-term assets on the Consolidated Condensed Balance Sheet represents interest due on the line of credit more than twelve months from the date of the financial statements as contractually required by the lender.  The restrictions will lapse when the related long-term debt is paid off.

XML

Contracts In Process

6 Months Ended

Jun. 30, 2017

Contracts In Process [Abstract]

Contracts In Process

(6)   Contracts in Process

At June 30, 2017 and December 31, 2016, the estimated period to complete contracts in process ranged from one month and one to six months, respectively.  We expect to collect all accounts receivable arising from these contracts within sixty days of billing.

The following summarizes contracts in process:

	June 30,		December 31,
	2017		2016
Costs incurred on uncompleted contracts	$	502,701	$	502,701
Estimated earnings		331,969		331,969
		834,670		834,670
Less billings to date		(804,753)		(804,753)
Contracts in process	$	29,917	$	29,917
Included in the accompanying Consolidated Condensed Balance Sheets is as follows:
Costs and estimated earnings in excess of billings on uncompleted contracts	$	29,917	$	29,917
Contracts in process	$	29,917	$	29,917

XML

Inventories

6 Months Ended

Jun. 30, 2017

Inventories [Abstract]

Inventories

(7)   Inventories

Inventories at June 30, 2017 and December 31, 2016 consisted of:

	June 30,		December 31,
	2017		2016
Raw materials	$	7,626,365	$	7,279,855
Work-in-process		370,579		105,252
Finished products		1,466,849		1,531,544
Reserve for excess and obsolete inventory		(7,107,279)		(7,166,916)
	$	2,356,514	$	1,749,735

We maintain raw material inventories of electronic components, motor parts and other materials to meet our expected manufacturing needs for proprietary products and for products manufactured to the design specifications of our customers. Some of these components may become obsolete or impaired due to bulk purchases in excess of customer requirements. Accordingly, we periodically assess our raw material and finished product inventories for potential impairment of value based on then available information, expectations and estimates and establish impairment reserves as appropriate.

As of December 31, 2016, we re-evaluated the carrying value of our PowerPhase Pro® product.  A key factor in our analysis during the nine-month transition period ended December 31, 2016 was that in October 2016, our customer, ITL Efficiency Corporation, informed us of their intention to purchase in cash a significant portion of the PowerPhase Pro® inventory by the filing date of our Form 10-KT for the nine-month transition period ended December 31, 2016.  That payment had not at that point in time been received.  Because of the long delays in this customer’s product launch and the lack of a significant cash payment towards this inventory, we determined that approximately $6.8 million of this inventory be reserved as excess inventory and we took a charge for this amount against this inventory as of December 31, 2016.  We have purchase orders from existing customers to acquire the remaining balance of the PowerPhase Pro® inventory. We also reserved approximately $350,000 for other obsolete inventory as of December 31, 2016.

During the six months ended June 30, 2017, we recovered $57,394 of the reserve due to parts being used in production of units to be sold or repaired for customers.

XML

Other Current Liabilities

6 Months Ended

Jun. 30, 2017

Other Current Liabilities [Abstract]

Other Current Liabilities

(8)   Other Current Liabilities

Other current liabilities at June 30, 2017 and December 31, 2016 consisted of:

	June 30,		December 31,
	2017		2016
Accrued payroll and employee benefits	$	129,359	$	62,220
Accrued personal property and real estate taxes		119,936		232,326
Accrued warranty costs		305,983		289,710
Unearned revenue		236,575		116,886
Accrued royalties		48,336		48,336
Accrued import duties		87,100		87,100
Accrued vendor settlements		189,175		189,175
Accrued executive compensation		350,000		272,222
Other		20,565		20,966
	$	1,487,029	$	1,318,941

XML

Debt

6 Months Ended

Jun. 30, 2017

Debt

Debt

(9)  Debt

On March 15, 2017, the Company entered into a non-revolving line of credit for $5.6 million.  The loan is collateralized by the Company’s headquarters facility.  The interest rate is variable based upon the one month LIBOR rate plus 4.0% per annum on the outstanding balance which was 5.22% as of June 30, 2017.  As a of condition of the loan, $600,000 was immediately drawn on the line of credit to be used for monthly interest payments on borrowings over the life of the loan.  This is reported as restricted cash on the Consolidated Condensed Balance Sheet as of June 30, 2017.  For additional information, see Note 5 to the Consolidated Condensed Financial Statements.  The covenants under the debt agreement require the Company to have liquid assets of a minimum of $1.5 million with the lender.  In addition, financial statements are to be presented no later than 45 days after the end of each quarter and 90 days after the end of each fiscal year.  These covenants took effect for the quarter ending June 30, 2017.  As of June 30, 2017, the Company was in compliance with its covenants. The non-revolving line of credit will expire on March 15, 2019 and the amounts repaid during the term of the loan may not be re-borrowed. At the expiry date, all outstanding principal and interest are due. As of June 30, 2017, $3,164,529 was drawn on the line of credit.  The Company incurred deferred financing costs of $73,060 upon securing the line of credit.

XML

Stock-Based Compensation

6 Months Ended

Jun. 30, 2017

Stock-Based Compensation [Abstract]

Stock-Based Compensation

(10)   Stock-Based Compensation

Share-Based Compensation Expense

The table below shows total share-based compensation expense for the quarters and six months ended June 30, 2017 and 2016 and the classification of these expenses:

	Quarters Ended June 30,				Six Months Ended June 30,
	2017		2016		2017		2016
Costs of product sales	$	4,391	$	2,974	$	7,327	$	5,254
Costs of contract services		1,280		2,409		2,097		4,335
Research and development		10,293		6,817		18,901		11,412
Selling, general and administrative		51,019		41,564		100,223		82,331
	$	66,983	$	53,764	$	128,548	$	103,332

Stock Option Plans Activity

Additional information with respect to stock option activity during the six months ended June 30, 2017 under our Stock Option Plans is as follows:

				Weighted-
		Weighted-		Average
	Shares	Average		Remaining		Aggregate
	Under	Exercise		Contractual		Intrinsic
	Option	Price		Life		Value
Outstanding at December 31, 2016	3,004,798	$	1.20		6.4 years	$	-
Granted	-	$	-				-
Exercised	-	$	-			$	-
Forfeited	(27,003)	$	1.10			$	168
Outstanding at June 30, 2017	2,977,795	$	1.20		6.0 years	$	-
Exercisable at June 30, 2017	2,168,542	$	1.38		5.0 years	$	-
Vested and expected to vest at June 30, 2017	2,716,789	$	1.21		5.8 years	$	-

As of June 30, 2017, there was $231,388 of total unrecognized compensation cost related to stock options granted under our Stock Option Plans.  The unrecognized compensation cost is expected to be recognized over a weighted-average period of twenty months.  The total fair value of stock options that vested during each of the six months ended June 30, 2017 and 2016 was $0 and $1,773, respectively.

Stock Bonus Plan Activity

Activity with respect to non-vested shares under the Stock Bonus Plan as of June 30, 2017 and 2016 and changes during the six months ended June 30, 2017 and 2016 are presented below:

	Six Months Ended June 30, 2017			Six Months Ended June 30, 2016
		Weighted-Average			Weighted-Average
	Shares Under	GrantDate		Shares Under	Grant Date
	Contract	Fair Value		Contract	Fair Value
Unvested at beginning of period	102,048	$	0.84	90,561	$	1.36
Granted	-	$	-	-	$	-
Vested	-	$	-	(3,667)	$	(0.69)
Forfeited	-	$	-	(3,920)	$	(1.25)
Unvested at end of period	102,048	$	0.84	82,974	$	1.39

As of June 30, 2017, there was $39,908 of total unrecognized compensation cost related to common stock granted under our Stock Bonus Plan.  The unrecognized compensation cost at June 30, 2017 is expected to be recognized over a weighted-average period of twenty months.

Employee Stock Purchase Plan Activity

During the three months ended June 30, 2017 and 2016, we issued 43,412 and 18,097 shares of common stock, respectively, under the Employee Stock Purchase Plan.  Cash received by us upon the purchase of shares under the Employee Stock Purchase Plan for the three months ended June 30, 2017 and 2016 was $16,497 and $9,591, respectively. As of June 30, 2017, 46,439 options had been purchased under this plan but the employee(s) had not exercised their right to acquire the common stock under the terms of the Employee Stock Purchase Plan.

XML

Stockholders' Equity

6 Months Ended

Jun. 30, 2017

Stockholders' Equity [Abstract]

Stockholders' Equity

(11)   Stockholders’ Equity

Changes in the components of stockholders’ equity during the six months ended June 30, 2017 were as follows:

	Number of
	common				Additional				Total
	shares		Common		paid-in		Accumulated		stockholders’
	issued		stock		capital		deficit		equity
Balances at December 31, 2016		48,519,313	$	485,193	$	128,409,933	$	(119,892,934)	$	9,002,192
Issuance of common stock under employee stock purchase plan		3,823		38		1,912		-		1,950
Compensation expense from employee and director stock option and common stock grants		-		-		61,564		-		61,564
Net loss		-		-		-		(1,606,026)		(1,606,026)
Balances at March 31, 2017		48,523,136	$	485,231	$	128,473,409	$	(121,498,960)	$	7,459,680
Issuance of common stock under employee stock purchase plan		43,412		434		16,062		-		16,496
Compensation expense from employee and director stock option and common stock grants				-		66,984		-		66,984
Net loss		-		-		-		(1,348,221)		(1,348,221)
Balances at June 30, 2017		48,566,548	$	485,665	$	128,556,455	$	(122,847,181)	$	6,194,939

The Company has warrants outstanding as follows:

	Common Stock	Warrants
	Follow-on Offering	Under Option	Earliest
Offering Date	(Shares)	(Shares)	Exercise Date	Expiration Date
February, 2014	2,864,872	1,489,733	August 6, 2014	August 5, 2018
October, 2015	8,000,000	4,000,000	April 30, 2016	October 30, 2020
	10,864,872	5,489,733

				Weighted-
		Weighted-		Average
	Warrants	Average		Remaining
	Under	Exercise		Contractual
	Option	Price		Life
Outstanding at December 31, 2016	5,489,733	$	1.53		3.3 years
Granted	-	$	-
Exercised	-	$	-
Forfeited	-	$	-
Outstanding at June 30, 2017	5,489,733	$	1.53		2.8 years
Exercisable at June 30, 2017	5,489,733	$	1.53		2.8 years

XML

Significant Customers

6 Months Ended

Jun. 30, 2017

Significant Customers [Abstract]

Significant Customers

(12)   Significant Customers 

We have historically derived significant revenue from a few key customers.  The following table summarizes revenue and percent of total revenue from significant customers for the quarters and six months ended June 30, 2017 and 2016:

	Quarter Ended June 30,								Six Months Ended June 30,
	2017				2016				2017				2016
Customer A	$	847,601	47	%	$	353,435	25	%	$	1,406,535	50	%	$	763,655	26	%
Customer B	$	211,000	12	%	$	-	-	%	$	300,000	11	%	$	-	-	%
Customer C	$	224,730	13	%	$	12,212	1	%	$	224,730	8	%	$	45,897	2	%
Customer D	$	142,334	8	%	$	225,105	16	%	$	175,138	6	%	$	358,010	12	%
Customer E	$	32,270	2	%	$	109,431	8	%	$	34,282	1	%	$	296,231	10	%
Customer F	$	-	-	%	$	250,519	17	%	$	-	-	%	$	536,013	18	%

The following table summarizes accounts receivable from significant customers as of June 30, 2017 and December 31, 2016:

	June 30,		December 31,
	2017		2016
Customer A	61	%	45	%
Customer B	-	%	-	%
Customer C	20	%	29	%
Customer D	15	%	10	%
Customer E	2	%	11	%
Customer F	-	%	-	%

XML

Income Taxes

6 Months Ended

Jun. 30, 2017

Income Taxes

Income Taxes

(13) Income Taxes

The Company currently has a full valuation allowance against its deferred tax assets, as it is management’s judgment that it is more-likely-than-not that net deferred tax assets will not be realized to reduce future taxable income.

As of June 30, 2017 and 2016, we had no provisions for interest or penalties related to uncertain tax positions.

The Company is subject to taxation in the U.S. and various state jurisdictions. As of June 30, 2017, the Company’s tax years for 2012 to 2016 are subject to examination by the tax authorities.

XML

Loss Per Common Share

6 Months Ended

Jun. 30, 2017

Loss Per Common Share [Abstract]

Loss Per Common Share

(14) Loss Per Common Share

The following table sets forth the computation of basic and diluted net loss per share for the quarters and six months ended June 30, 2017 and 2016:

	Quarter Ended June 30,				Six Months Ended June 30,
	2017		2016		2017		2016
Numerator:
Net loss	$	(1,348,221)	$	(1,954,030)	$	(2,954,247)	$	(2,884,948)
Denominator for basic and diluted net loss per common  share:
Weighted average number of shares of common stock outstanding - basic and diluted		48,563,209		48,346,344		48,543,093		48,327,310
Net loss per common share - basic and diluted	$	(0.03)	$	(0.04)	$	(0.06)	$	(0.06)

The following table sets forth the potential shares of common stock that are not included in the calculation of diluted net loss per share because to do so would be anti-dilutive as of the end of each period presented:

	June 30,
	2017		2016
Non-vested stock bonus plan shares		102,048	82,974
Stock options outstanding		3,024,234	2,488,838
Warrants to purchase common stock		5,489,733	5,489,733

XML

Fair Value Of Financial Instruments

6 Months Ended

Jun. 30, 2017

Fair Value of Financial Instruments

Fair Value Of Financial Instruments

(15) Fair Value of Financial Instruments

The carrying amounts of cash, cash equivalents, restricted cash, accounts receivable and accounts payable approximate fair value because of the short maturity of these instruments.

The Company measures the fair value of outstanding debt for disclosure purposes on a recurring basis and its long-term debt of $3,100,797 is reported at amortized cost.  The Company’s long-term debt is subject to variable rates of interest and accordingly its carrying value is considered to be representative of its fair market value.

XML

Commitments And Contingencies

6 Months Ended

Jun. 30, 2017

Commitments And Contingencies [Abstract]

Commitments And Contingencies

(16) Commitments and Contingencies

Employment Agreements

On July 21, 2015, the Company entered into new employment agreements with its four officers that expired on June 30, 2017. 

Effective July 1, 2017, the Company entered into new employment agreements with its four officers, which expire December 31, 2019.  The aggregate future base salary payable to the executive officers over their remaining terms is $2,666,260.

Litigation

We are involved in various claims and legal actions arising in the ordinary course of business.  In the opinion of management, and based on current available information, the ultimate disposition of these matters is not expected to have a material adverse effect on our financial position, results of operations or cash flow.

XML

Subsequent Event

6 Months Ended

Jun. 30, 2017

Subsequent Events [Abstract]

Subsequent Events

(17) Subsequent Event

On July 6, 2017, the Company sold 15 acres of vacant land adjacent to its manufacturing facility. The gross selling price of the land was $1.5 million (net proceeds were $1.4 million) which was representative of the fair market value.  This land is classified as held for sale on the Consolidated Condensed Balance Sheet as of June 30, 2017.

XML

New Accounting Pronouncements (Policies)

6 Months Ended

Jun. 30, 2017

New Accounting Pronouncements

New Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (“FASB”) issued a new standard to achieve a consistent application of revenue recognition within the U.S., resulting in a single revenue model to be applied by reporting companies under U.S. generally accepted accounting principles. Under the new model, recognition of revenue occurs when a customer obtains control of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, the new standard requires that reporting companies disclose the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The new standard is effective for us for the first fiscal year beginning after December 15, 2017.  Earlier application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. The new standard is required to be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying it recognized at the date of initial application and providing additional disclosures. The Company currently anticipates adopting the standard using the retrospective method with the cumulative effect and additional disclosures at the period of adoption. Based on the Company’s assessment on the impact of this guidance on our consolidated condensed financial statements, we expect revenue related to product and contract services to remain substantially unchanged.

In July 2015, the FASB issued guidance on simplifying the measurement of inventory from the lower of cost or market to the lower of cost and net realizable value.  Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation.  This guidance is effective for years beginning after December 15, 2016, including interim periods within those fiscal years.  Prospective application is allowed as of the beginning of an interim or annual reporting period.  An entity is only required to disclose the nature of and reason for the change in accounting principle in the first interim and annual period of adoption.  The Company adopted this new standard in the quarter ended March 31, 2017.  There was no material impact on the consolidated financial statements upon adoption.

In March 2016, the FASB issued guidance on improvements to employee share-based payment accounting for stock compensation.  The new standard addresses the topics of accounting for income taxes, classification of excess tax benefits on the Statement of Cash Flows, forfeitures, minimum statutory tax withholding requirements, and classification of employee taxes paid on the Statement of Cash Flows when an employer withholds shares for tax withholding purposes.  This is effective for annual periods beginning after December 15, 2016 and interim periods within those annual periods.  Early adoption is permitted within any interim or annual period.  Any adjustments should be reflective as of the beginning of the fiscal year that includes that interim period.  The Company adopted this new standard in the quarter ended March 31, 2017.  No adjustments were necessary upon adoption of the standard.

In November, 2016, the FASB issued guidance on the Statement of Cash Flows and the presentation of restricted cash in the statement. The new standard will require the Statement of Cash Flows to explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash.  As a result, the amounts generally described as restricted cash should be included in the cash and cash equivalents when reconciling the beginning of the period and end of the period total amounts shown on the Statement of Cash Flows. This is effective for annual periods beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted.  The amendments should be applied using the retrospective transition method in each period presented.  The Company has elected to early adopt this standard in the quarter ended June 30, 2017.  The ending cash balance in the Consolidated Condensed Cash Flow Statement was updated to reflect the adoption of the standard.  Additional disclosure has been included in Note 5 of the Consolidated Condensed Financial Statements as required by adopting the standard. 

XML

Cash, Cash Equivalents, and Restricted Cash (Tables)

6 Months Ended

Jun. 30, 2017

Cash and Cash Equivalents [Abstract]

Cash, cash equivalents, and restricted cash

	June 30,		December 31,
	2017		2016
Cash and cash equivalents	$	2,074,389	$	2,100,089
Restricted cash		165,312		-
Restricted cash included in other long-term assets		420,631		-
Total cash, cash equivalents, and restricted cash shown in the Consolidated Condensed Statement of Cash Flows	$	2,660,332	$	2,100,089

XML

Contracts In Process (Tables)

6 Months Ended

Jun. 30, 2017

Contracts In Process [Abstract]

Summary Of Contract In Process

	June 30,		December 31,
	2017		2016
Costs incurred on uncompleted contracts	$	502,701	$	502,701
Estimated earnings		331,969		331,969
		834,670		834,670
Less billings to date		(804,753)		(804,753)
Contracts in process	$	29,917	$	29,917
Included in the accompanying Consolidated Condensed Balance Sheets is as follows:
Costs and estimated earnings in excess of billings on uncompleted contracts	$	29,917	$	29,917
Contracts in process	$	29,917	$	29,917

XML

Inventories (Tables)

6 Months Ended

Jun. 30, 2017

Inventories [Abstract]

Schedule Of Inventories

	June 30,		December 31,
	2017		2016
Raw materials	$	7,626,365	$	7,279,855
Work-in-process		370,579		105,252
Finished products		1,466,849		1,531,544
Reserve for excess and obsolete inventory		(7,107,279)		(7,166,916)
	$	2,356,514	$	1,749,735

XML

Other Current Liabilities (Tables)

6 Months Ended

Jun. 30, 2017

Other Current Liabilities [Abstract]

Schedule Of Other Current Liabilities

	June 30,		December 31,
	2017		2016
Accrued payroll and employee benefits	$	129,359	$	62,220
Accrued personal property and real estate taxes		119,936		232,326
Accrued warranty costs		305,983		289,710
Unearned revenue		236,575		116,886
Accrued royalties		48,336		48,336
Accrued import duties		87,100		87,100
Accrued vendor settlements		189,175		189,175
Accrued executive compensation		350,000		272,222
Other		20,565		20,966
	$	1,487,029	$	1,318,941

XML

Stock-Based Compensation (Tables)

6 Months Ended

Jun. 30, 2017

Stock-Based Compensation [Abstract]

Schedule Of Share-Based Compensation Expense

	Quarters Ended June 30,				Six Months Ended June 30,
	2017		2016		2017		2016
Costs of product sales	$	4,391	$	2,974	$	7,327	$	5,254
Costs of contract services		1,280		2,409		2,097		4,335
Research and development		10,293		6,817		18,901		11,412
Selling, general and administrative		51,019		41,564		100,223		82,331
	$	66,983	$	53,764	$	128,548	$	103,332

Summary Of Stock Option Activity

				Weighted-
		Weighted-		Average
	Shares	Average		Remaining		Aggregate
	Under	Exercise		Contractual		Intrinsic
	Option	Price		Life		Value
Outstanding at December 31, 2016	3,004,798	$	1.20		6.4 years	$	-
Granted	-	$	-				-
Exercised	-	$	-			$	-
Forfeited	(27,003)	$	1.10			$	168
Outstanding at June 30, 2017	2,977,795	$	1.20		6.0 years	$	-
Exercisable at June 30, 2017	2,168,542	$	1.38		5.0 years	$	-
Vested and expected to vest at June 30, 2017	2,716,789	$	1.21		5.8 years	$	-

Schedule Of Nonvested Share Activity

	Six Months Ended June 30, 2017			Six Months Ended June 30, 2016
		Weighted-Average			Weighted-Average
	Shares Under	GrantDate		Shares Under	Grant Date
	Contract	Fair Value		Contract	Fair Value
Unvested at beginning of period	102,048	$	0.84	90,561	$	1.36
Granted	-	$	-	-	$	-
Vested	-	$	-	(3,667)	$	(0.69)
Forfeited	-	$	-	(3,920)	$	(1.25)
Unvested at end of period	102,048	$	0.84	82,974	$	1.39

XML

Stockholders' Equity (Tables)

6 Months Ended

Jun. 30, 2017

Stockholders' Equity [Abstract]

Changes In Components Of Stockholders' Equity

	Number of
	common				Additional				Total
	shares		Common		paid-in		Accumulated		stockholders’
	issued		stock		capital		deficit		equity
Balances at December 31, 2016		48,519,313	$	485,193	$	128,409,933	$	(119,892,934)	$	9,002,192
Issuance of common stock under employee stock purchase plan		3,823		38		1,912		-		1,950
Compensation expense from employee and director stock option and common stock grants		-		-		61,564		-		61,564
Net loss		-		-		-		(1,606,026)		(1,606,026)
Balances at March 31, 2017		48,523,136	$	485,231	$	128,473,409	$	(121,498,960)	$	7,459,680
Issuance of common stock under employee stock purchase plan		43,412		434		16,062		-		16,496
Compensation expense from employee and director stock option and common stock grants				-		66,984		-		66,984
Net loss		-		-		-		(1,348,221)		(1,348,221)
Balances at June 30, 2017		48,566,548	$	485,665	$	128,556,455	$	(122,847,181)	$	6,194,939

Warrants

	Common Stock	Warrants
	Follow-on Offering	Under Option	Earliest
Offering Date	(Shares)	(Shares)	Exercise Date	Expiration Date
February, 2014	2,864,872	1,489,733	August 6, 2014	August 5, 2018
October, 2015	8,000,000	4,000,000	April 30, 2016	October 30, 2020
	10,864,872	5,489,733

				Weighted-
		Weighted-		Average
	Warrants	Average		Remaining
	Under	Exercise		Contractual
	Option	Price		Life
Outstanding at December 31, 2016	5,489,733	$	1.53		3.3 years
Granted	-	$	-
Exercised	-	$	-
Forfeited	-	$	-
Outstanding at June 30, 2017	5,489,733	$	1.53		2.8 years
Exercisable at June 30, 2017	5,489,733	$	1.53		2.8 years

XML

Significant Customers (Tables)

6 Months Ended

Jun. 30, 2017

Sales Revenue, Goods, Net [Member]

Concentration Risk [Line Items]

Schedule of significant customers

	Quarter Ended June 30,								Six Months Ended June 30,
	2017				2016				2017				2016
Customer A	$	847,601	47	%	$	353,435	25	%	$	1,406,535	50	%	$	763,655	26	%
Customer B	$	211,000	12	%	$	-	-	%	$	300,000	11	%	$	-	-	%
Customer C	$	224,730	13	%	$	12,212	1	%	$	224,730	8	%	$	45,897	2	%
Customer D	$	142,334	8	%	$	225,105	16	%	$	175,138	6	%	$	358,010	12	%
Customer E	$	32,270	2	%	$	109,431	8	%	$	34,282	1	%	$	296,231	10	%
Customer F	$	-	-	%	$	250,519	17	%	$	-	-	%	$	536,013	18	%

Accounts Receivable [Member]

Concentration Risk [Line Items]

Schedule of significant customers

	June 30,		December 31,
	2017		2016
Customer A	61	%	45	%
Customer B	-	%	-	%
Customer C	20	%	29	%
Customer D	15	%	10	%
Customer E	2	%	11	%
Customer F	-	%	-	%

XML

Loss Per Common Share (Tables)

6 Months Ended

Jun. 30, 2017

Loss Per Common Share [Abstract]

Basic and Diluted Net Loss Per Share

	Quarter Ended June 30,				Six Months Ended June 30,
	2017		2016		2017		2016
Numerator:
Net loss	$	(1,348,221)	$	(1,954,030)	$	(2,954,247)	$	(2,884,948)
Denominator for basic and diluted net loss per common  share:
Weighted average number of shares of common stock outstanding - basic and diluted		48,563,209		48,346,344		48,543,093		48,327,310
Net loss per common share - basic and diluted	$	(0.03)	$	(0.04)	$	(0.06)	$	(0.06)

Shares Not Included In Diluted Net Loss Per Share

	June 30,
	2017		2016
Non-vested stock bonus plan shares		102,048	82,974
Stock options outstanding		3,024,234	2,488,838
Warrants to purchase common stock		5,489,733	5,489,733

XML

Segement Reporting (Details)	6 Months Ended
	Jun. 30, 2017 segment
Segment Reporting
Number of Operating Segments	1

XML

Going Concern (Details) - USD ($)	Mar. 15, 2017	Jun. 30, 2017	Dec. 31, 2016
Basis Of Presentation
Working Capital Surplus		$ 3,185,302
Accumulated deficit		122,847,181	$ 119,892,934
Line of credit	$ 5,600,000
Line of credit rate plus one month LIBOR rate	4.00%
Drawn on the line of credit		$ 3,164,529

XML

Cash, Cash Equivalents, and Restricted Cash (Details) - USD ($)	Jun. 30, 2017	Dec. 31, 2016	Jun. 30, 2016	Dec. 31, 2015
Cash and Cash Equivalents [Abstract]
Cash and cash equivalents	$ 2,074,389	$ 2,100,089
Restricted cash	165,312
Restricted cash, noncurrent	420,631
Total cash, cash equivalents, and restricted cash	$ 2,660,332	$ 2,100,089	$ 5,497,556	$ 8,688,668

XML

Contracts In Process (Narrative) (Details)	6 Months Ended	12 Months Ended
	Jun. 30, 2017	Dec. 31, 2016
Contracts In Process [Abstract]
Estimated Period To Complete Contracts In Process, Minimum	1 month	1 month
Estimated Period To Complete Contracts In Process, Maximum		6 months
Expected collection period of accounts receivable	60 days

XML

Contracts In Process (Summary Of Contract In Process) (Details) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Contracts In Process [Abstract]
Costs incurred on uncompleted contracts	$ 502,701	$ 502,701
Estimated earnings	331,969	331,969
Contracts in process, Gross	834,670	834,670
Less billings to date	(804,753)	(804,753)
Contracts in progress, Total	29,917	29,917
Costs and estimated earnings in excess of billings on uncompleted contracts	$ 29,917	$ 29,917

XML

Inventories (Schedule Of Inventories) (Details) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Inventories [Abstract]
Raw materials	$ 7,626,365	$ 7,279,855
Work-in-process	370,579	105,252
Finished products	1,466,849	1,531,544
Reserve for excess and obsolete inventory	(7,107,279)	(7,166,916)
Inventories, Total	$ 2,356,514	$ 1,749,735

XML

Inventories (Details) - USD ($)	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
(Recoveries) or impairment of inventories	$ (57,394)	$ 9,906
PowerPhase Pro [Member]
Inventory reserve			$ 6,800,000
Other Obsolete Inventory [Member]
Inventory reserve			$ 350,000

XML

Other Current Liabilities (Schedule Of Other Current Liabilities) (Details) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Other Current Liabilities [Abstract]
Accrued payroll and employee benefits	$ 129,359	$ 62,220
Accrued personal property and real estate taxes	119,936	232,326
Accrued warranty costs	305,983	289,710
Unearned revenue	236,575	116,886
Accrued royalties	48,336	48,336
Accrued import duties	87,100	87,100
Accrued vendor settlements	189,175	189,175
Accrued executive compensation	350,000	272,222
Other	20,565	20,966
Other current liabilities, Total	$ 1,487,029	$ 1,318,941

XML

Debt - Narrative (Details) - USD ($)	Mar. 15, 2017	Jun. 30, 2017	Dec. 31, 2016
Debt
Line of credit	$ 5,600,000
Line of credit rate plus one month LIBOR rate	4.00%
Interest rate at end of period		5.22%
Minimum Liquid Assets	$ 1,500,000
Amount drawn on line of credit	600,000	$ 3,164,529
Deferred financing costs	$ 73,060	$ 63,732	$ 0

XML

Stock-Based Compensation (Narrative) (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair value of options vested in period			$ 0	$ 1,773
Equity Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation costs	$ 231,388		$ 231,388
Unrecognized compensation costs, period for recognition			20 months
Stock Bonus Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation costs	$ 39,908		$ 39,908
Unrecognized compensation costs, period for recognition			20 months
Stock Purchase Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares issued in period for share-based awards	43,412	18,097
Cash received from settlement of share-based awards	$ 16,497	$ 9,591
Options purchased under this plan	46,439		46,439

XML

Stock-Based Compensation (Schedule Of Share-Based Compensation Expense) (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Share-based compensation expense	$ 66,983	$ 53,764	$ 128,548	$ 103,332
Costs Of Product Sales [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Share-based compensation expense	4,391	2,974	7,327	5,254
Costs Of Contract Services [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Share-based compensation expense	1,280	2,409	2,097	4,335
Research And Development [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Share-based compensation expense	10,293	6,817	18,901	11,412
Selling, General And Administrative [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Share-based compensation expense	$ 51,019	$ 41,564	$ 100,223	$ 82,331

XML

Stock-Based Compensation (Summary Of Stock Option Activity) (Details) - USD ($)	3 Months Ended	6 Months Ended	12 Months Ended
	Jun. 30, 2017	Jun. 30, 2017	Dec. 31, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Outstanding at Period End, Options	3,024,234	3,024,234
Equity Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Outstanding at Period Start, Options		3,004,798
Forfeited, Options		(27,003)
Outstanding at Period End, Options	2,977,795	2,977,795	3,004,798
Exercisable, Options	2,168,542	2,168,542
Vested and expected to vest, Options	2,716,789	2,716,789
Outstanding at Period Start, Weighted-Average Exercise Price		$ 1.20
Forfeited, Weighted-Average Exercise Price		1.10
Outstanding at Period End, Weighted-Average Exercise Price	$ 1.20	1.20	$ 1.20
Exercisable, Weighted-Average Exercise Price	1.38	1.38
Vested and expected to vest, Weighted-Average Exercise Price	$ 1.21	$ 1.21
Outstanding, Weighted Average Remaining Contractual Life	6 years		6 years 4 months 24 days
Exercisable, Weighted Average Remaining Contractual Life	5 years
Vested and expected to vest, Weighted Average Remaining Contractual Life	5 years 9 months 18 days
Forfeited, aggregate intrinsic value		$ 168

XML

Stock-Based Compensation (Schedule Of Nonvested Share Activity) (Details) - $ / shares	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Non-vested Ending balance, shares	102,048	82,974
Stock Bonus Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Non-vested beginning balance, shares	102,048	90,561
Granted, shares
Vested, shares		(3,667)
Forfeited, shares		(3,920)
Non-vested Ending balance, shares	102,048	82,974
Non-vested beginning balance, Weighted-Average Grant Date Fair Value	$ 0.84	$ 1.36
Granted, Weighted-Average Grant Date Fair Value
Vested, Weighted-Average Grant Date Fair Value		(0.69)
Forfeited, Weighted-Average Grant Date Fair Value		(1.25)
Non-vested ending balance, Weighted-Average Grant Date Fair Value	$ 0.84	$ 1.39

XML

Stockholders' Equity (Details) - USD ($)	3 Months Ended			6 Months Ended
	Jun. 30, 2017	Mar. 31, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Class of Stock [Line Items]
Beginning balance, value	$ 7,459,680	$ 9,002,192		$ 9,002,192
Beginning balance, shares		48,519,313		48,519,313
Issuance of common stock under employee stock purchase plan, value	16,496	$ 1,950
Compensation expense from employee and director stock option and common stock grants	66,984	61,564
Net loss	(1,348,221)	(1,606,026)	$ (1,954,030)	$ (2,954,247)	$ (2,884,948)
Ending balance, value	$ 6,194,939	7,459,680		$ 6,194,939
Ending balance, shares	48,566,548			48,566,548
Common Stock [Member]
Class of Stock [Line Items]
Beginning balance, value	$ 485,231	$ 485,193		$ 485,193
Beginning balance, shares	48,523,136	48,519,313		48,519,313
Issuance of common stock under employee stock purchase plan, value	$ 434	$ 38
Issuance of common stock under employee stock purchase plan, shares	43,412	3,823
Ending balance, value	$ 485,665	$ 485,231		$ 485,665
Ending balance, shares	48,566,548	48,523,136		48,566,548
Additional Paid-in Capital [Member]
Class of Stock [Line Items]
Beginning balance, value	$ 128,473,409	$ 128,409,933		$ 128,409,933
Issuance of common stock under employee stock purchase plan, value	16,062	1,912
Compensation expense from employee and director stock option and common stock grants	66,984	61,564
Ending balance, value	128,556,455	128,473,409		128,556,455
Accumulated Deficit [Member]
Class of Stock [Line Items]
Beginning balance, value	(121,498,960)	(119,892,934)		(119,892,934)
Net loss	(1,348,221)	(1,606,026)
Ending balance, value	$ (122,847,181)	$ (121,498,960)		$ (122,847,181)

XML

Stockholders' Equity (Narrative) (Details) - USD ($)	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Warrants and Rights Note Disclosure [Abstract]
Issuance of common stock under direct offering, shares	10,864,872
Warrants under option (Shares)	5,489,733
Class of Warrant or Right, Exercise Price of Warrants or Rights	$ 1.53		$ 1.53
Proceeds from Issuance of Common Stock		$ (65,000)
Class of Warrant or Right, Outstanding	5,489,733		5,489,733

XML

Stockholders' Equity - Warrants (Details) - $ / shares	3 Months Ended	6 Months Ended	12 Months Ended
	Jun. 30, 2017	Jun. 30, 2017	Dec. 31, 2016
Class of Warrant or Right [Line Items]
Common stock follow-on offering (shares)		10,864,872
Warrants under option (shares)	5,489,733	5,489,733
Warrants under option, outstanding beginning balance		5,489,733
Warrants under option, outstanding ending balance	5,489,733	5,489,733	5,489,733
Warrants under option, exercisable	5,489,733	5,489,733
Weighted-average exercise price, beginning balance		$ 1.53
Weighted-average exercise price, ending balance	$ 1.53	1.53	$ 1.53
Weighted-average exercise price, exercisable	$ 1.53	$ 1.53
Weighted-average remaining contractual life, outstanding	2 years 9 months 18 days		3 years 3 months 18 days
Weighted-average remaining contractual life, exercisable	2 years 9 months 18 days
February 2014 [Member]
Class of Warrant or Right [Line Items]
Common stock follow-on offering (shares)		2,864,872
Warrants under option (shares)	1,489,733	1,489,733
October 2015 [Member]
Class of Warrant or Right [Line Items]
Common stock follow-on offering (shares)		8,000,000
Warrants under option (shares)	4,000,000	4,000,000

XML

Significant Customers (Details) - USD ($)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Concentration Risk [Line Items]
Revenue from major customer, amount	$ 1,571,390	$ 1,173,261	$ 2,416,925	$ 2,392,058
Customer A [Member] | Sales Revenue, Goods, Net [Member]
Concentration Risk [Line Items]
Revenue from major customer, amount	$ 847,601	$ 353,435	$ 1,406,535	$ 763,655
Customer A [Member] | Accounts Receivable [Member]
Concentration Risk [Line Items]
Revenue from major customer, percentage	61.00%				45.00%
Customer A [Member] | Customer Concentration Risk [Member]
Concentration Risk [Line Items]
Revenue from major customer, percentage	47.00%	25.00%	50.00%	26.00%
Customer B [Member] | Sales Revenue, Goods, Net [Member]
Concentration Risk [Line Items]
Revenue from major customer, amount	$ 211,000		$ 300,000
Customer B [Member] | Customer Concentration Risk [Member]
Concentration Risk [Line Items]
Revenue from major customer, percentage	12.00%		11.00%
Customer C [Member] | Sales Revenue, Goods, Net [Member]
Concentration Risk [Line Items]
Revenue from major customer, amount	$ 224,730	$ 12,212	$ 224,730	$ 45,897
Customer C [Member] | Accounts Receivable [Member]
Concentration Risk [Line Items]
Revenue from major customer, percentage	20.00%				29.00%
Customer C [Member] | Customer Concentration Risk [Member]
Concentration Risk [Line Items]
Revenue from major customer, percentage	13.00%	1.00%	8.00%	2.00%
Customer D [Member] | Sales Revenue, Goods, Net [Member]
Concentration Risk [Line Items]
Revenue from major customer, amount	$ 142,334	$ 225,105	$ 175,138	$ 358,010
Customer D [Member] | Accounts Receivable [Member]
Concentration Risk [Line Items]
Revenue from major customer, percentage	15.00%				10.00%
Customer D [Member] | Customer Concentration Risk [Member]
Concentration Risk [Line Items]
Revenue from major customer, percentage	8.00%	16.00%	6.00%	12.00%
Customer E [Member] | Sales Revenue, Goods, Net [Member]
Concentration Risk [Line Items]
Revenue from major customer, amount	$ 32,270	$ 109,431	$ 34,282	$ 296,231
Customer E [Member] | Accounts Receivable [Member]
Concentration Risk [Line Items]
Revenue from major customer, percentage	2.00%				11.00%
Customer E [Member] | Customer Concentration Risk [Member]
Concentration Risk [Line Items]
Revenue from major customer, percentage	2.00%	8.00%	1.00%	10.00%
Customer F [Member] | Sales Revenue, Goods, Net [Member]
Concentration Risk [Line Items]
Revenue from major customer, amount		$ 250,519		$ 536,013
Customer F [Member] | Customer Concentration Risk [Member]
Concentration Risk [Line Items]
Revenue from major customer, percentage		17.00%		18.00%

XML

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended
	Jun. 30, 2017	Mar. 31, 2017	Jun. 30, 2016	Mar. 31, 2016
Income Taxes
Interest or penalties related to uncertain tax positions	$ 0	$ 0	$ 0	$ 0

XML

Loss Per Common Share (Basic and Diluted Net Loss Per Share) (Details) - USD ($)	3 Months Ended			6 Months Ended
	Jun. 30, 2017	Mar. 31, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Loss Per Common Share [Abstract]
Net loss	$ (1,348,221)	$ (1,606,026)	$ (1,954,030)	$ (2,954,247)	$ (2,884,948)
Weighted Average Number of Shares Outstanding, Basic and Diluted	48,563,209		48,346,344	48,543,093	48,327,310
Net loss per common share - basic and diluted	$ (0.03)		$ (0.04)	$ (0.06)	$ (0.06)

XML

Loss Per Common Share (Number Shares) (Details) - USD ($)	Jun. 30, 2017	Jun. 30, 2016
Loss Per Common Share [Abstract]
Non-vested stock bonus plan shares	102,048	82,974
Stock Options Outstanding	3,024,234	2,488,838
Warrants and Rights Outstanding	$ 5,489,733	$ 5,489,733

XML

Fair Value of Financial Instruments (Details)	Jun. 30, 2017 USD ($)
Recurring | Carrying value
Fair Value of Financial Instruments
Long-term debt	$ 3,100,797

XML

Commitments And Contingencies (Details)	Jun. 30, 2017 USD ($)
Commitments And Contingencies [Abstract]
Aggregate future base salary payable	$ 2,666,260

XML

Subsequent Event (Details) - Subsequent Event [Member] $ in Millions	Jul. 06, 2017 USD ($) a
Subsequent Event [Line Items]
Area of Land | a	15
Land under contract sale price	$ 1.5
Proceeds from sale of land	$ 1.4