Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
Sep. 30, 2017 | Nov. 07, 2017 | |
Document Information [Line Items] | ||
Entity Registrant Name | Nuo Therapeutics, Inc. | |
Entity Central Index Key | 1,091,596 | |
Trading Symbol | aurx | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Current Reporting Status | Yes | |
Entity Voluntary Filers | No | |
Entity Well-known Seasoned Issuer | No | |
Entity Common Stock, Shares Outstanding (in shares) | 22,727,112 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Current Period Unaudited) - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 |
Current assets | ||
Cash and cash equivalents | $ 1,923,172 | $ 2,620,023 |
Restricted cash | 50,008 | 53,503 |
Accounts and other receivable, net | 163,628 | 294,298 |
Inventory, net | 64,135 | 69,954 |
Prepaid expenses and other current assets | 367,484 | 334,437 |
Total current assets | 2,568,427 | 3,372,215 |
Property and equipment, net | 255,887 | 486,116 |
Deferred costs and other assets | 188,105 | 278,730 |
Intangible assets, net | 7,201,358 | 7,840,408 |
Goodwill | 0 | 2,079,284 |
Total assets | 10,213,777 | 14,056,753 |
Current liabilities | ||
Accounts payable | 434,467 | 392,615 |
Accrued expenses and liabilities | 1,251,043 | 1,054,677 |
Total current liabilities | 1,685,510 | 1,447,292 |
Other liabilities | 58,994 | 123,434 |
Total liabilities | 1,744,504 | 1,570,726 |
Commitments and contingencies (see Note 11) | ||
Stockholders' equity | ||
Preferred stock; $0.0001 par value, 1,000,000 shares authorized, 29,038 shares issued and outstanding; liquidation value $29,038,000 | 3 | 3 |
Common stock; $0.0001 par value, 31,500,000 shares authorized, 22,727,112 and 9,927,112 shares issued and outstanding as of September 30, 2017 and December 31, 2016, respectively | 2,273 | 993 |
Additional paid-in capital | 21,144,184 | 18,180,658 |
Accumulated deficit | (12,677,187) | (5,695,627) |
Total stockholders' equity | 8,469,273 | 12,486,027 |
Total liabilities and stockholders' equity | $ 10,213,777 | $ 14,056,753 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 |
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 1,000,000 | 1,000,000 |
Preferred stock, shares issued (in shares) | 29,038 | 29,038 |
Preferred stock, shares outstanding (in shares) | 29,038 | 29,038 |
Preferred stock, liquidation value | $ 29,038,000 | $ 29,038,000 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.001 |
Common stock, shares authorized (in shares) | 31,500,000 | 31,500,000 |
Common stock, shares issued (in shares) | 22,727,112 | 9,927,112 |
Common stock, shares outstanding (in shares) | 22,727,112 | 9,927,112 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 4 Months Ended | 5 Months Ended | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | May 04, 2016 | Sep. 30, 2016 | Sep. 30, 2017 | |
Revenue | |||||
Product sales | $ 122,087 | $ 139,000 | $ 247,890 | $ 382,884 | |
License fees | |||||
Royalties | 40,109 | 37,773 | 63,740 | 140,655 | |
Total revenue | 162,196 | 176,773 | 311,630 | 523,539 | |
Costs of revenue | |||||
Costs of sales | 263,993 | 277,603 | 453,416 | 811,451 | |
Costs of royalties | |||||
Total costs of revenue | 263,993 | 277,603 | 453,416 | 811,451 | |
Gross loss | (101,797) | (100,830) | (141,786) | (287,912) | |
Operating expenses | |||||
Sales and marketing | 162,867 | 331,636 | 568,950 | 537,248 | |
Research and development | 299,477 | 323,455 | 547,824 | 1,008,377 | |
General and administrative | 811,034 | 1,099,915 | 1,702,732 | 3,058,046 | |
Impairment of goodwill | 2,079,284 | ||||
Total operating expenses | 1,273,378 | 1,755,006 | 2,819,506 | 6,682,955 | |
Loss from operations | (1,375,175) | (1,855,836) | (2,961,292) | (6,970,867) | |
Other income (expense) | |||||
Interest, net | (3,900) | (1,059) | (1,168) | (11,738) | |
Other | 2,176 | 55,371 | 75,495 | 1,045 | |
Reorganization items | (115,149) | (324,551) | |||
Total other income (expense) | (1,724) | (60,837) | (250,224) | (10,693) | |
Net loss | $ (1,376,899) | $ (1,916,673) | $ (3,211,516) | $ (6,981,560) | |
Basic (in dollars per share) | $ (0.09) | $ (0.19) | $ (0.33) | $ (0.59) | |
Diluted (in dollars per share) | $ (0.09) | $ (0.19) | $ (0.33) | $ (0.59) | |
Basic (in shares) | 15,852,764 | 9,927,112 | 9,876,605 | 11,924,035 | |
Diluted (in shares) | 15,852,764 | 9,927,112 | 9,876,605 | 11,924,035 | |
Predecessor [Member] | |||||
Revenue | |||||
Product sales | $ 922,608 | ||||
License fees | 139,534 | ||||
Royalties | 670,079 | ||||
Total revenue | 1,732,221 | ||||
Costs of revenue | |||||
Costs of sales | 829,095 | ||||
Costs of royalties | 54,543 | ||||
Total costs of revenue | 883,638 | ||||
Gross loss | 848,583 | ||||
Operating expenses | |||||
Sales and marketing | 833,943 | ||||
Research and development | 554,586 | ||||
General and administrative | 2,307,009 | ||||
Impairment of goodwill | |||||
Total operating expenses | 3,695,538 | ||||
Loss from operations | (2,846,955) | ||||
Other income (expense) | |||||
Interest, net | (252,956) | ||||
Other | 2,495 | ||||
Reorganization items | 31,271,350 | ||||
Total other income (expense) | 31,020,889 | ||||
Net loss | $ 28,173,934 | ||||
Basic (in dollars per share) | $ 0.22 | ||||
Diluted (in dollars per share) | $ 0.15 | ||||
Basic (in shares) | 125,951,100 | ||||
Diluted (in shares) | 193,258,792 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows (Unaudited) | 4 Months Ended | 5 Months Ended | 9 Months Ended |
May 04, 2016USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($) | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net income (loss) | $ (3,211,516) | $ (6,981,560) | |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | |||
Non-cash gain on reorganization | |||
Impairment of goodwill | 2,079,284 | ||
Stock-based compensation | 42,306 | ||
Depreciation and amortization | 518,209 | 868,570 | |
Write off of debt issuance costs | |||
Bad debt (recovery) expense | 1,651 | (97,115) | |
Inventory obsolescence expense | 2,308 | 5,101 | |
Gain on disposal of fixed assets | (1,205) | ||
Change in operating assets and liabilities: | |||
Accounts and other receivable | 380,144 | 227,785 | |
Inventory | 5,815 | 718 | |
Prepaid expenses and other current assets | (133,514) | (33,047) | |
Other assets | 46,803 | 90,625 | |
Accounts payable | (2,378,882) | 41,852 | |
Accrued liabilities | (1,681,926) | 118,866 | |
Accrued interest | |||
Deferred revenue | |||
Other liabilities | (28,422) | (64,440) | |
Net cash used in operating activities | (6,479,330) | (3,702,260) | |
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Changes in restricted cash | (26) | 3,495 | |
Proceeds from sale of equipment | 1,914 | ||
Net cash provided by (used in) investing activities | (26) | 5,409 | |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Proceeds from issuance of common stock and preferred stock, net of issuance costs | 3,000,000 | ||
Proceeds from issuance of debtor-in-procession note payable, net of issuance costs | |||
Net cash provided by financing activities | 3,000,000 | ||
Net increase in (decrease in) cash and cash equivalents | (6,479,356) | (696,851) | |
Cash and cash equivalents, beginning of period | 10,358,209 | 2,620,023 | |
Cash and cash equivalents, end of period | $ 10,358,209 | 3,878,853 | 1,923,172 |
Supplemental cash flow information | |||
Interest expense paid in cash | 1,241 | 9,812 | |
Cash flows related to reorganization item, net | 1,507,863 | ||
Non-cash financing and investing activities | |||
Issuance of common stock | 217,936 | ||
Issuance of preferred stock to settle debt | 8,288,719 | ||
Accrued cost related to issuance of common stock | 77,500 | ||
Investor [Member] | |||
Non-cash financing and investing activities | |||
Issuance of common stock | 226 | ||
Predecessor [Member] | |||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net income (loss) | 28,173,934 | ||
Adjustments to reconcile net income (loss) to net cash used in operating activities: | |||
Non-cash gain on reorganization | (34,869,565) | ||
Impairment of goodwill | |||
Stock-based compensation | 55,081 | ||
Depreciation and amortization | 289,360 | ||
Write off of debt issuance costs | 278,303 | ||
Bad debt (recovery) expense | |||
Inventory obsolescence expense | |||
Gain on disposal of fixed assets | |||
Change in operating assets and liabilities: | |||
Accounts and other receivable | (274,200) | ||
Inventory | 106,108 | ||
Prepaid expenses and other current assets | 194,835 | ||
Other assets | (61,427) | ||
Accounts payable | 2,024,959 | ||
Accrued liabilities | 1,159,737 | ||
Accrued interest | 172,651 | ||
Deferred revenue | (261,075) | ||
Other liabilities | (76,992) | ||
Net cash used in operating activities | (3,088,291) | ||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Changes in restricted cash | (14) | ||
Proceeds from sale of equipment | |||
Net cash provided by (used in) investing activities | (14) | ||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Proceeds from issuance of common stock and preferred stock, net of issuance costs | 7,052,500 | ||
Proceeds from issuance of debtor-in-procession note payable, net of issuance costs | 5,471,697 | ||
Net cash provided by financing activities | 12,524,197 | ||
Net increase in (decrease in) cash and cash equivalents | 9,435,892 | ||
Cash and cash equivalents, beginning of period | 922,317 | $ 10,358,209 | |
Cash and cash equivalents, end of period | 10,358,209 | ||
Supplemental cash flow information | |||
Interest expense paid in cash | 78,822 | ||
Cash flows related to reorganization item, net | 1,839,560 | ||
Non-cash financing and investing activities | |||
Issuance of common stock | |||
Issuance of preferred stock to settle debt | |||
Predecessor [Member] | Investor [Member] | |||
Non-cash financing and investing activities | |||
Issuance of common stock |
Note 1 - Description of Busines
Note 1 - Description of Business and Bankruptcy Proceedings | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Nature of Operations [Text Block] | Note 1 – Description of Business and Bankruptcy Proceedings Description of Business Nuo Therapeutics, Inc. (“Nuo Therapeutics,” the “Company,” “we,” “us,” or “our”) is a biomedical company marketing its products primarily within the U.S. We commercialize innovative cell-based technologies that harness the regenerative capacity of the human body to trigger natural healing. The use of autologous (from self) biological therapies for tissue repair and regeneration is part of a transformative clinical strategy designed to improve long-term recovery in complex chronic conditions with significant unmet medical needs. Growth opportunities for the Aurix System in the United States in the near to intermediate term include the treatment of chronic wounds with Aurix in: (i) the Medicare population under a National Coverage Determination (“NCD”), when registry data is collected under the Coverage with Evidence Development (“CED”) program of the Centers for Medicare & Medicaid Services (“CMS”); and (ii) the Veterans Affairs (“VA”) healthcare system and other federal accounts settings. As of September 30, 2017, two May 5, 2016, Bankruptcy Proceedings On January 26, 2016, 11 11 No. 16 10192 11 On April 25, 2016 (the “Confirmation Date”), the Bankruptcy Court entered an Order Granting Final Approval of Disclosure Statement and Confirming Debtor’s Plan of Reorganization (the “Confirmation Order”), which confirmed the Modified First Amended Plan of Reorganization of the Debtor under Chapter 11 Scenario A contemplated by the Plan of Reorganization became effective on May 5, 2016 ( not $0.0001 Upon emergence from bankruptcy on the Effective Date, the Company applied fresh start accounting, resulting in the Company becoming a new entity for financial reporting purposes (see Note 2 – Fresh Start Accounting May 5, 2016 May 4, 2016 May 5, 2016. May 5, 2016 not Common Stock Recapitalization In accordance with the Plan of Reorganization, as of the Effective Date, the Company issued 7,500,000 $0.0001 $7,300,000 $7,052,500 200,000 7,500,000 $100,000 8 Debt “Series A Preferred Stock 6,180,000 May 5, 2021 November 5, 2016 $0.50 $1.00 12,800,000 $3,000,000 September 30, 2017, 12,800,000 $3.0 As of the Effective Date, the Company entered into a registration rights agreement (the “Registration Rights Agreement”) with the Recapitalization Investors. The Registration Rights Agreement provides certain resale registration rights to the Recapitalization Investors with respect to securities received in the Recapitalization Financing. Pursuant to the Registration Rights Agreement, the Company filed, and has to update periodically, a registration statement covering the resale of all shares of New Common Stock issued to the Recapitalization Investors on the Effective Date until such time as such shares have been sold or may 144 Issuance of New Common Stock to Holders of Old Common Stock As of the Effective Date, the Company committed to the issuance of up to 3,000,000 2,264,612 March 28, 2016, no July 5, 2016, The holders of Old Common Stock who executed and timely delivered the required release documents are referred to as the “Releasing Holders.” The 2,264,612 ’s records or could otherwise be confirmed at a rate of one 41.8934 March 28, 2016. not Issuance of Shares in Exchange for Administrative Claims On June 20, 2016, 162,500 11 503 3 503 4 June 20, 2016. The Administrative Claim Shares were issued to holders of administrative claims under sections 503 3 503 4 162,500 100,000 62,500 $62,500 December 2015 Series A Preferred Stock On the Effective Date, the Company filed a Certificate of Designations of Series A Preferred Stock (the “Certificate of Designations”) with the Delaware Secretary of State, designating 29,038 ’s undesignated preferred stock, par value $0.0001 29,038 1145 not The Series A Preferred Stock has no not $29,038,000, not one one five 1% Assignment and Assumption Agreement; Transition Services Agreement Pursuant to the Plan, on May 5, 2016, ’s rights, title and interest in and to its existing license agreement with Arthrex, and to transfer and assign to the Assignee associated intellectual property owned by the Company and licensed thereunder, as well as rights to collect royalty payments thereunder. The assignment and transfer was effected in exchange for a reduction of $15,000,000 Termination of Deerfield Facility Agreement and DIP Credit Agreement On the Effective Date, the obligations of the Company under the Deerfield Facility Agreement, and under the DIP Credit Agreement (as defined below in Note 8 Debt |
Note 2 - Fresh Start Accounting
Note 2 - Fresh Start Accounting | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Reorganization under Chapter 11 of US Bankruptcy Code Disclosure [Text Block] | Note 2 – Fresh Start Accounting Upon the Company ’s emergence from Chapter 11 50% May 4, 2016, January 1, 2016 May 4, 2016 Upon the application of fresh start accounting, the Company allocated the reorganization value to its individual assets based on their estimated fair values. Reorganization value represents the fair value of the Successor Company ’s assets before considering liabilities, and the excess of reorganization value over the fair value of identified tangible and intangible assets is reported separately on the consolidated balance sheet as goodwill. The Company, with the assistance of external valuation specialists, estimated the enterprise value of the Company upon emergence from Chapter 11 $17.9 May 5, 2016 December 31, 2025, 3.4% 2025. The Company ’s future cash flow projections included a variety of estimates and assumptions that had a significant effect on the determination of the Company’s enterprise value. While the Company considered such estimates and assumptions reasonable, they are inherently subject to significant business, economic and competitive uncertainties, many of which are beyond the Company’s control and, therefore, may not 2025; 29% ● The reorganization value, estimated at approximately $24.0 May 5, 2016. ● Each liability existing as of May 5, 2016 ● Deferred tax assets and liabilities have been recognized for differences between the assigned values and the tax basis of the recognized assets and liabilities, and have been fully valued as of May 5, 2016 Pursuant to fresh start accounting, the Company allocated the determined reorganization value to the Successor Company ’s assets as follows (in thousands): Enterprise Value $ 17,889 Plus estimated fair value of liabilities 6,161 Reorganization Value 24,050 Less: Estimated fair value of tangible assets (13,574 ) Estimated fair value of identifiable intangible assets (8,397 ) Goodwill $ 2,079 Upon the adoption of fresh start accounting, the Successor Company adopted the significant accounting policies of the Predecessor Company (see Note 3 – Liquidity and Summary of Significant Accounting Policies May 4, 2016 As a result of events and circumstances in the quarter ended June 30, 2017 consequently, the goodwill balance of approximately $2.1 June 30, 2017 ( 7 Goodwill and Other Intangible Assets Predecessor Company Reorganization Adjustments Fresh Start Adjustments Successor Company ASSETS Current assets Cash and cash equivalents $ 3,305,709 $ 7,052,500 (1) $ 10,358,209 Restricted cash 53,463 53,463 Accounts and other receivable, net 1,288,445 1,288,445 Inventory, net 56,348 56,348 Prepaid expenses and other current assets 611,593 $ (16,053 )(b) 595,540 Total current assets 5,315,558 (16,053 ) 7,052,500 12,352,005 Property and equipment, net 865,716 865,716 Deferred costs and other assets 355,741 355,741 Intangible assets, net 2,406,457 (2,406,457 )(a) 8,397,000 (2) 8,397,000 Goodwill - 2,079,284 (2) 2,079,284 TOTAL ASSETS $ 8,943,472 $ (2,422,510 ) $ 17,528,784 $ 24,049,746 LIABILITIES AND EQUITY (DEFICIT) Current liabilities not subject to compromise Accounts payable $ 2,877,170 $ 2,877,170 Accrued expenses and liabilities 3,112,244 3,112,244 Deferred revenue, current portion 899,920 $ (899,920 )(c) - Short term debtor-in-possession note payable 5,750,000 (5,750,000 )(d) - Total current liabilities not subject to compromise 12,639,334 (6,649,920 ) $ - 5,989,414 Non-current liabilities not subject to compromise Deferred revenue - - Other liabilities 171,613 171,613 Total non-current liabilities not subject to compromise 171,613 - - 171,613 Liabilities subject to compromise Accounts payable 214,554 (214,554 )(e) - Accrued expenses and liabilities 559,202 (559,202 )(e) - Accrued interest 3,316,121 (3,316,121 )(d) - Deferred revenue - - Convertible debt subject to put rights 35,000,000 (35,000,000 )(d) - Total liabilities subject to compromise 39,089,877 (39,089,877 ) - - TOTAL LIABILITIES 51,900,824 (45,739,797 ) - 6,161,027 Conditionally redeemable common stock 500,000 (500,000 )(f) - Common stock outstanding, at par 12,477 (12,477 )(f) 750 (1) 750 Common stock issuable 392,950 (392,950 )(f) - Preferred stock outstanding, at par - 3 (3) 3 Additional paid-in capital 126,011,808 (126,011,808 )(f) 17,887,966 (4) 17,887,966 Retained earnings (accumulated deficit) (169,874,587 ) 170,234,522 (g) (359,935 )(5) - TOTAL EQUITY (DEFICIT) (43,457,352 ) 43,817,287 17,528,784 17,888,719 TOTAL LIABILITIES AND EQUITY (DEFICIT) $ 8,943,472 $ (2,422,510 ) $ 17,528,784 $ 24,049,746 Reorganization Adjustments (a) As a result of fresh start accounting, all intangible assets existing as of the Effective Date were established at fair value. This adjustment eliminates the carrying value of previously existing intangible assets as of the Effective Date, as the underlying Angel assets were assigned to Deerfield pursuant to the Plan of Reorganization. (b) Pursuant to the Plan of Reorganization, the Company assigned to Deerfield the Company ’s: (i) rights, title and interest in and to its existing license agreement with Arthrex; (ii) the associated intellectual property owned by the Company and licensed under such agreement; and (iii) rights to collect royalty payments thereunder. As such, certain prepaid expenses related to the Angel business were eliminated. (c) Pursuant to the Plan of Reorganization, the Company assigned to Deerfield the Company ’s (i) rights, title and interest in and to its existing license agreement with Arthrex, (ii) the associated intellectual property owned by the Company and licensed under such agreement, and (iii) rights to collect royalty payments thereunder. As such, all deferred revenue related to the existing license agreement with Arthrex as of the Effective Date was eliminated. (d) Pursuant to the Plan of Reorganization, the Company ’s obligations under the Deerfield Facility Agreement, including accrued interest, were cancelled, and the Company ceased to have any obligations thereunder. Additionally, pursuant to the Plan of Reorganization, the DIP Credit Agreement was terminated. (e) Represents claims not (f) Pursuant to the Plan of Reorganization, all equity interests of the Company, including but not (g) Represents the cumulative impact of the reorganization adjustments: Description Adjustment Amount Elimination of existing intangible assets (a) $ (2,406,457 ) Elimination of prepaid Angel expenses (b) (16,053 ) Elimination of Angel deferred revenue (c) 899,920 Termination of debt agreements and accrued interest (d) 44,066,121 Elimination of various payables and accruals (e) 773,756 Cancellation of existing equity (f) 126,917,235 Cumulative impact of the reorganization adjustments (g) $ 170,234,522 Fresh Start Adjustments ( 1 Pursuant to the Plan of Reorganization, as of the Effective Date, the Company issued 7,500,000 to certain accredited investors for net cash to the Company of $7,052,500. 6,180,000 May 5, 2021 November 5, 2016 $0.50 $1.00 12,800,000 $3,000,000. 12,800,000 August September 2017. ( 2 Represents identifiable intangible assets of approximately $8.4 $2.1 ’s assets before considering liabilities, and the excess of reorganization value over the fair value of identified tangible and intangible assets is reported separately on the consolidated balance sheet as goodwill. The Company, with the assistance of external valuation specialists, estimated the enterprise value of the Company upon emergence from Chapter 11 $17.9 May 5, 2016 December 31, 2025, June 30, 2017, $2.1 June 30, 2017 ( 7 Goodwill and Other Intangible Assets) In applying fresh start accounting, the Company followed these principles: ● The reorganization value, estimated as approximately $24.0 May 5, 2016. ● Each liability existing as of May 5, 2016 ● Deferred tax assets and liabilities have been recognized for differences between the assigned values and the tax basis of the recognized assets and liabilities, and have been fully valued as of May 5, 2016 Pursuant to fresh start accounting the Company allocated the determined reorganization value to the Successor Company ’s assets as follows (in thousands): Enterprise Value $ 17,889 Plus estimated fair value of liabilities 6,161 Reorganization Value 24,050 Less: Estimated fair value of tangible assets (13,574 ) Estimated fair value of identifiable intangible assets (8,397 ) Goodwill $ 2,079 ( 3 Pursuant to the Plan of Reorganization, on the Effective Date, the Company issued 29,038 no not $29,038,000, not ( 4 Reflects the cumulative impact of the fresh start adjustments described above on additional paid-in-capital: Description Adjustment Amount Cash proceeds from issuance of common stock (1) $ 7,052,500 Establishment of intangible assets (2) 10,476,284 Net assets of the predecessor (5) 359,935 Less par value of common and preferred stock (3) (753 ) Cumulative impact of the fresh start adjustments described above on additional paid-in-capital (4) $ 17,887,966 ( 5 Reflects the elimination of retained earnings upon the application of fresh start accounting. Reorganization Items, net Costs directly attributable to the bankruptcy proceedings and the implementation of the Plan are reported as reorganization items, net. A summary of reorganization items for the period ended September 30, 2016 Successor Predecessor Period from May 5, 2016 through September 30, 2016 Period from January 1, 2016 through May 4, 2016 Professional fees $ 324,551 $ 3,598,216 Net gain on reorganization adjustments - (34,869,566 ) Reorganization items, net $ 324,551 $ (31,271,350 ) Cash payments for reorganization items $ 1,507,863 $ 1,839,560 |
Note 3 - Liquidity and Summary
Note 3 - Liquidity and Summary of Significant Accounting Principles | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Significant Accounting Policies [Text Block] | Note 3 – Liquidity and Summary of Significant Accounting Principles Liquidity Our operations are subject to significant risks and uncertainties including, among others, those relating to ease of access to capital on acceptable terms, current and potential competitors with greater resources, dependence on significant customers, lack of operating history, and uncertainty of future profitability and fluctuations in financial results. Since our inception, we have financed our operations by raising debt, issuing equity and equity-linked instruments, and executing licensing arrangements, and to a lesser extent by generating royalties and product revenues. We have incurred, and continue to incur, recurring operating losses and negative cash flows. During the quarter ended September 30, 2017, 12,800,000 $3.0 September 30, 2017, $1.9 The accompanying consolidated financial statements have been prepared assuming that we will continue as a going concern, which contemplates continuity of operations, realization of assets, and satisfaction of liabilities in the ordinary course of business. The propriety of using the going-concern basis is dependent upon, among other things, the ability to generate sufficient cash from operations, and potential other funding sources, including cash on hand, to meet our obligations as they become due. We believe based on the operating cash requirements and capital expenditures expected for the next twelve first 2018. We require additional capital prior to the end of the first 2018 may may may not may not If we are unable to secure sufficient capital to fund our operating activities or we are unable to increase revenues significantly, we may As noted in Note 2 – Fresh Start Accounting January 1, 2017. Basis of Presentation The accompanying unaudited interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). In our opinion, the accompanying unaudited interim consolidated financial statements include all adjustments, consisting of normal recurring adjustments, which are necessary to present fairly our financial position, results of operations and cash flows. The consolidated balance sheet at December 31, 2016, not may 2 – Fresh Start Accounting May 5, 2016 not not Company’s Annual Report on Form 10 December 31, 2016. Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned and controlled subsidiary Aldagen, Inc. (“Aldagen”). All significant inter-company accounts and transactions are eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. In the accompanying consolidated financial statements, estimates are used for, but not Credit Concentration We generate accounts receivable from the sale of our products. In addition, other receivables consist primarily of the receivable due from our contract manufacturer for the cost of raw materials required to manufacture the Angel products that are purchased by the Company and immediately resold, at cost, to the contract manufacturer and a refund due for Delaware franchise taxes. Specific customer or other receivables balances in excess of 10% September 30, 2017 December 31, 2016 Successor Successor September 30, 2017 December 31, 2016 Other receivable A 65% 58% Customer B - 10% Revenue from significant customers exceeding 10% Successor Successor Three months ended September 30, 2017 Three months ended September 30, 2016 Customer A 25% 21% Customer B 13% 24% Customer C - 14% Customer D 11% - Successor Successor Predecessor Nine months ended September 30, 2017 Period from May 5, 2016 through September 30, 2016 Period from January 1, 2016 through May 4, 2016 Customer A - - 78% Customer B 27% 20% - Customer C 11% 20% - Customer D - 11% - Historically, we used single suppliers for several components of the Aurix product line. We outsource the manufacturing of various products to contract manufacturers. While we believe these manufacturers demonstrate competency, reliability and stability, there is no one not Cash Equivalents We consider all highly liquid instruments purchased with an original maturity of three 1.7 $250,000 September 30, 2017. Accounts Receivables We generate accounts receivables from the sale of our products. We provide for an allowance against receivables for estimated losses that may ’s inability or unwillingness to pay. The allowance for doubtful accounts is estimated primarily based upon historical write-off percentages, known problem accounts, and current economic conditions. Accounts are written off against the allowance for doubtful accounts when we determine that amounts are not September 30, 2017, $306,000, December 31, 2016, $409,000, Inventory Our inventory is produced by third first first 18 two As of September 30, 2017, $35,200 $36,900 December 31, 2016, $18,100 $59,800 We provide for an allowance against inventory for estimated losses that may ’s remaining shelf-life and our anticipated ability to sell such inventory, which is estimated using historical usage and future forecasts, within its remaining shelf life. At September 30, 2017 December 31, 2016, $8,000. Property and Equipment Property and equipment is stated at cost less accumulated depreciation and is depreciated, using the straight-line method, over its estimated useful life ranging from one six one three Centrifuges may no no Property and equipment is reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not Goodwill and Other Intangible Assets Predecessor intangible assets and goodwill In conjunction with the application of fresh start accounting, all then-remaining finite lived intangible assets, including those acquired as part of our acquisition of the Angel business were written off as of the Effective Date (see Note 2 – Fresh Start Accounting Successor intangible assets and goodwill In the Successor Company financial statements, intangible assets were established as part of fresh start accounting and relate to trademarks, technology, clinician relationships, and goodwill (see Note 2 – Fresh Start Accounting Our finite-lived intangible assets include trademarks, technology (including patents), and clinician relationships, and are amortized over their useful lives and reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not not not Goodwill represents the excess of reorganization value over the fair value of tangible and identifiable intangible assets and the fair value of liabilities as of the Effective Date. Goodwill is not December 31, not one Prior to the adoption of Accounting Standards Update 2017 04 – Intangibles - Goodwill and Other (Topic 350 January 1, 2017, first not no Detailed impairment testing involved comparing the fair value of our one no second second one one one not Under the new guidance, we perform our annual, or interim, goodwill impairment test by comparing the fair value of our one ’s fair value; however, the loss recognized should not not December 31, 2016 not 2017 04. June 30, 2017, not June 30, 2017. June 30, 2017 $2.8 $2.1 zero June 30, 2017. Revenue Recognition – Successor Company We recognize revenue when the four 1 2 3 4 We provide for the sale of our products, including disposable processing sets and supplies to customers. Revenue from the sale of products is recognized upon shipment of products to the customers. We do not not not Revenue Recognition – Predecessor Company The Predecessor Company provided for the sale of our products, including disposable processing sets and supplies to customers, and to Arthrex as distributor of the Angel product line. Revenue from the sale of products was recognized upon shipment. Usage or leasing of blood separation equipment As a result of the acquisition of the Angel business, we acquired various multiple element revenue arrangements that combined the (i) usage or leasing of blood separation processing equipment, (ii) maintenance of processing equipment, and (iii) purchase of disposable processing sets and supplies. We assigned these multiple element revenue arrangements to Arthrex in 2013 no License Agreement with Rohto The Company ’s license agreement with Rohto (see Note 4 – Distribution, Licensing and Collaboration Arrangements Segments and Geographic Information Approximately 25% 21% three September 30, 2017 2016, 27% 12% nine September 30, 2017 2016, one Stock-Based Compensation Prior to the Effective Date, the Company, from time to time, issued stock options or stock awards to employees, directors, consultants, and other service providers under its 2002 2013 9 – Equity and Stock-Based Compensation All outstanding stock options were cancelled as of the Effective Date. In July 2016, August 2016 ’s 2016 “2016 November 21, 2016, 2016 three nine September 30, 2017, zero 56,250 1,362,500 three nine September 30, 2016. The fair value of employee stock options is measured at the date of grant. Expected volatilities for the 2016 five ’s stock, and Company data was utilized to estimate option exercises and employee terminations within the valuation model. The risk-free rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. The Company estimated that the dividend rate on its common stock will be zero. The assumptions used are summarized in the following table: Successor Successor Nine Months ended September 30, 2017 Year ended December 31, 2016 Risk free rate 2.0 - 2.1% 1.8 - 2.0% Weighted average expected years until exercise 5.0 - 6.0 4.8 - 6.0 Expected stock volatility 83% 83% Dividend yield - - Stock-based compensation for awards granted to non-employees is periodically re-measured as the underlying awards vest. The Company recognizes an expense for such awards throughout the performance period as the services are provided by the non-employees, based on the fair value of these options and warrants at each reporting period. The fair value of stock options and compensatory warrants issued to service providers utilizes the same methodology with the exception of the expected term. For awards to non-employees, the Company estimates that the options or warrants will be held for the full term. The Company adopted new accounting guidance on January 1, 2017 not Income Taxes The Company accounts for income taxes using the asset and liability method. Under the asset and liability method, current income tax expense or benefit is the amount of income taxes expected to be payable or refundable for the current year. A deferred income tax asset or liability is recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax credits and loss carryforwards. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not not The Company ’s policy for recording interest and penalties associated with audits is to record such items as a component of income before taxes. There were no 2017 2016. Basic and Diluted Earnings (Loss) per Share Basic earnings (loss) per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of shares of common stock outstanding (including contingently issuable shares when the contingencies have been resolved) during the period. For periods of net loss, diluted loss per share is calculated similarly to basic loss per share because the impact of all dilutive potential common shares is anti-dilutive. For periods of net income, and when the effects are not All of the Company ’s outstanding stock options and warrants were considered anti-dilutive for the three nine September 30, 2017. January 1, 2016 May 4, 2016 April 1, 2016 May 4, 2016, three nine September 30, 2017, 1,111,250 6,180,000 May 5, 2016 September 30, 2016, 6,180,000 January 1, 2016 May 4, 2016, 9,173,119 113,629,178 Earnings (loss) per share are calculated for basic and diluted earnings per share as follows: Successor Successor Three Months ended September 30, 2017 Three Months ended September 30, 2016 Numerator for net loss for basic and diluted loss per share $ (1,376,899 ) $ (1,916,673 ) Denominator for basic and fully diluted loss per share weighted average outstanding common shares 15,852,764 9,927,112 Basic and diluted loss per share Basic $ (0.09 ) $ (0.19 ) Diluted $ (0.09 ) $ (0.19 ) Successor Successor Predecessor Nine Months ended September 30, 2017 Period from May 5, 2016 through September 30, 2016 Period from January 1, 2016 through May 4, 2016 Numerator for basic income (loss) per share $ (6,981,560 ) $ (3,211,516 ) $ 28,173,934 Numerator adjustments for potential dilutive securities - - 172,546 Numerator for diluted income (loss) per share $ (6,981,560 ) $ (3,211,516 ) $ 28,346,480 Denominator for basic income (loss) per share weighted average outstanding common shares 11,924,035 9,876,605 125,951,100 Dilutive effect of convertible debt - - 67,307,692 Denominator for diluted income (loss) per share 11,924,035 9,876,605 193,258,792 Basic and diluted earnings (loss) per share Basic $ (0.59 ) $ (0.33 ) $ 0.22 Diluted $ (0.59 ) $ (0.33 ) $ 0.15 Recently Adopted Accounting Pronouncements In July 2015, 330 December 15, 2016, January 1, 2017; not In November 2015, December 15, 2016. January 1, 2017; not In March 2016, December 15, 2016, The adoption of certain amendments of the guidance must be applied prospectively, and adoption of the remaining amendments must be applied either on a modified retrospective basis or retrospectively to all periods presented. We adopted this pronouncement effective January 1, 2017; not In January 2017, 2 2, ’s fair value; however, the loss recognized should not zero 2 December 15, 2021. January 1, 2017. January 1, 2017; not not 2017 04. one June 30, 2017, $2.8 $2.1 zero June 30, 2017. Unadopted Accounting Pronouncements In May 2014, five 1 2 3 4 5 August 2015, one December 15, 2017, December 15, 2016. March 2016, April 2016, May 2016, two March 3, 2016 May 2016, In February 2016, December 15, 2018, In June 2016, December 15, 2019. December 15, 2018. We are currently evaluating the impact, if any, that the adoption of this guidance will have on our consolidated financial statements. In August 2016, December 15, 2017. may In November 2016, December 15, 2017. In January 2017, not December 15, 2018. In May 2017, 718. 718 December 15, 2017. 1 not 2 not We have evaluated all other issued and unadopted Accounting Standards Updates and believe the adoption of these standards will not |
Note 4 - Distribution, Licensin
Note 4 - Distribution, Licensing and Collaboration Arrangements | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Distributors and License Agreement [Text Block] | Note 4 – Distribution, Licensing and Collaboration Arrangements Distribution and License Agreement with Arthrex In 2013, five three one five ’s Angel concentrated Platelet System and activAT (“Products”), throughout the world, for all uses other than chronic wound care. In connection with execution of the Original Arthrex Agreement, Arthrex paid the Company a nonrefundable upfront payment of $5.0 not October 16, 2015, not March 31, 2016, April 2016, Pursuant to the Plan, on May 5, 2016, ’s rights, title and interest in and to the Arthrex Agreement, and to transfer and assign to the Assignee associated intellectual property owned by the Company and licensed thereunder, as well as rights to collect royalty payments thereunder. The assignment and transfer was effected in exchange for a reduction of $15,000,000 On the Effective Date, the Company and the Assignee entered into a Transition Services Agreement, in which the Company agreed to continue to service the Arthrex Agreement for a transition period. On October 20, 2016, January 15, 2017. $201,200 October 28, 2016, October 27, 2016: ( ’s inventory of Angel products (including spare parts therefor) and production equipment; and (b) the Assignee is obligated to make three $33,333 $33,333 three December 31, 2016 no January 15, 2017. June 30, 2016, Distribution and License Agreement with Rohto In January 2015, ’s intellectual property for the development, import, use, manufacturing, marketing, sale and distribution for all wound care and topical dermatology applications of the Aurix System and related intellectual property and know-how in human and veterinary medicine in Japan in exchange for an upfront payment from Rohto of $3.0 one $1.5 $3.0 may Collaboration Agreement with Restorix Health On March 22, 2016, 30 125 three two one Pursuant to the Collaboration Agreement, the Company agreed to provide: (i) clinical support services by its clinical staff as reasonably agreed between the Company and Restorix as necessary and appropriate, (ii) reasonable and necessary support regarding certain reimbursement activities, (iii) coverage of Institutional Review Board (“IRB”) fees and payment to Restorix for certain training costs subject to certain limitations and (iv) community-focused public relations materials for participating RXH Partner Hospitals to promote the use of Aurix and participation in the Protocols. Pursuant to the Collaboration Agreement, Restorix agreed to: (i) provide access and support as reasonably necessary and appropriate at up to 30 Subject to the satisfaction of certain conditions, during the term of the Collaboration Agreement: (i) Restorix will have site specific geographic exclusivity for usage of Aurix in connection with treatment of patients in the Protocols within a 30 not 19 Under the Collaboration Agreement, the Company will pay Restorix or the RXH Partner Hospital, as the case may $700 2016, no $750 Boyalife Distribution Agreement Effective as of May 5, 2016, ’s significant shareholder, Boyalife Investment Fund I, Inc., entered into an Exclusive License and Distribution Agreement (the “Boyalife Distribution Agreement”) with an initial term of five not May 5, 2016 $500,000 90 no December 31, 2018, $40, not third first no $250,000 |
Note 5 - Receivables
Note 5 - Receivables | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Loans, Notes, Trade and Other Receivables Disclosure [Text Block] | Note 5 – Receivables Accounts and other receivable, net consisted of the following: Successor Successor September 30, 2017 December 31, 2016 Trade receivables $ 116,802 $ 100,660 Other receivables 352,722 603,015 469,524 703,675 Less allowance for doubtful accounts (305,896 ) (409,377 ) Accounts and other receivable, net $ 163,628 $ 294,298 Other receivables at September 30, 2017 December 31, 2016 September 30, 2017 December 31, 2016 |
Note 6 - Property and Equipment
Note 6 - Property and Equipment | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Property, Plant and Equipment Disclosure [Text Block] | Note 6 — Property and Equipment Property and equipment, net consisted of the following: Successor Successor September 30, 2017 December 31, 2016 Medical equipment $ 402,234 $ 405,096 Office equipment 48,888 48,888 Software 257,619 257,619 Manufacturing equipment 34,899 34,899 Leasehold improvements 19,215 19,215 762,855 765,717 Less accumulated depreciation and amortization (506,968 ) (279,601 ) Property and equipment, net $ 255,887 $ 486,116 Depreciation and amortization expense reflected in operating expenses was approximately $51,000 $230,000 three nine September 30, 2017, January 1, 2016 May 4, 2016 $182,000, May 5, 2016 September 30, 2016 $175,000. |
Note 7 - Goodwill and Other Int
Note 7 - Goodwill and Other Intangible Assets | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Goodwill and Intangible Assets Disclosure [Text Block] | Note 7 – Goodwill and Other Intangible Assets Our finite-lived intangible assets as of September 30, 2017 December 31, 2016 Successor Successor September 30, 2017 December 31, 2016 Trademarks $ 917,000 $ 917,000 Technology 6,576,000 6,576,000 Customer and clinician relationships 904,000 904,000 8,397,000 8,397,000 Accumulated amortization trademarks (85,784 ) (39,934 ) Accumulated amortization technology (1,025,290 ) (477,290 ) Accumulated amortization customer and clinician relationships (84,568 ) (39,368 ) (1,195,642 ) (556,592 ) $ 7,201,358 $ 7,840,408 Goodwill Goodwill represents the excess of reorganization value over the fair value of tangible and identifiable intangible assets and the fair value of liabilities as of the Effective Date and as of December 31, 2016. not December 31, 2016 not 2017 04 January 31, 2017. prior quarter ended June 30, 2017, not, June 30, 2017. June 30, 2017 $2.8 $2.1 zero June 30, 2017. 2016 2017 Successor Balance, at December 31, 2015 $ - Fresh start accounting 2,079,284 Balance, at December 31, 2016 2,079,284 Impairment of goodwill (2,079,284 ) Balance, at September 30, 2017 $ - Finite-lived intangible assets – trademarks, customer and clinician relationships and technology The Predecessor Company ’s finite-lived intangible assets include Angel-related trademarks, technology (including patents) and customer relationships, and were being amortized over their useful lives ranging from eight twenty $90 $20 January 1, 2016 May 4, 2016 April 1, 2016 May 4, 2016, May 4, 2016 The Successor Company ’s Aurix related finite-lived intangible assets include trademarks, technology (including patents), and clinician relationships, and are being amortized over their useful lives ranging from nine fifteen $639,000 nine September 30, 2017 $548,000 September 30, 2017: 2017 (Fourth quarter 2017) $ 213,000 2018 852,000 2019 852,000 2020 852,000 2021 852,000 Thereafter 3,580,000 |
Note 8 - Debt
Note 8 - Debt | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Debt Disclosure [Text Block] | Note 8 – Debt Successor Company Debt As of September 30, 2017, no Deerfield Facility Agreement In 2014, $35 five h Deerfield due March 31, 2019. January 26, 2016 ( $38.3 $5.75 29,038 Debtor-in-Possession Financing On January 28, 2016, January 28, 2016, not 100% On March 9, 2016, $6,000,000 We received $5.75 January 1, 2016 May 4, 2016, $0.3 Interest Expense Interest expense was approximately $5,400 and $14,200, three nine September 30, 2017. January 1, 2016 May 4, 2016 $253,000 $79,000 $173,000 |
Note 9 - Equity and Stock-based
Note 9 - Equity and Stock-based Compensation | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Stockholders' Equity Note Disclosure [Text Block] | Note 9 – Equity and Stock-Based Compensation Under the Second Amended and Restated Certificate of Incorporation of the Successor Company, it has the authority to issue a total of 32,500,000 31,500,000 1,000,000 $0.0001 In accordance with the Plan, as of the Effective Date, the Company issued 7,500,000 $7,300,000 $7,052,500, The net cash amount excludes the effect of $100,000 A significant majority of the Recapitalization Investors executed Backstop Commitments to purchase up to 12,800,000 $3,000,000. During the quarter ended September 30, 2017, 12,800,000 $3.0 Under the Plan of Reorganization, the Company committed to the issuance of up to 3,000,000 2,264,612 March 28, 2016, no July 5, 2016, The holders of Old Common Stock who executed and timely delivered the required release documents are referred to as the “Releasing Holders.” The 2,264,612 ’s records or could otherwise be confirmed, at a rate of one 41.8934 March 28, 2016. not On June 20, 2016, 162,500 11 503 3 503 4 June 20, 2016. The Administrative Claim Shares were issued to holders of administrative claims under sections 503 3 503 4 162,500 100,000 62,500 $62,500 December 2015 Successor Company Stock Purchase Warrants As part of the Recapitalization Financing, the Company also issued Warrants to purchase 6,180,000 May 5, 2021 $0.50 $1.00 Successor Company Series A Preferred Stock On the Effective Date, the Company filed a Certificate of Designations of Series A Preferred Stock with the Delaware Secretary of State, designating 29,038 ’s undesignated preferred stock, par value $0.0001 29,038 1145 not The Series A Preferred Stock has no not $29,038,000, not For so long as Series A Preferred Stock is outstanding, the holders of Series A Preferred Stock have the right to nominate and elect one five 1% pari passu not $3.0 two Stock-Based Compensation Predecessor Company The Company ’s 2002 2013 10,500,000 18,000,000 June 9, 2014). As of May 4, 2016, four no ten May 4, 2016, not Successor Company In July 2016, August 4, 2016, ’s 2016 “2016 first January 1, 2017) six 6% may not 1,000,000 November 21, 2016, 2016 1,590,000 1,500,000 2016 September 30, 2017 December 31, 2016, A summary of stock option activity under the 2016 September 30, 2017, nine September 30, 2017, Stock Options – 2016 Omnibus Plan Shares Weighted Average Weighted Average Aggregate Intrinsic Outstanding at December 31, 2016 1,265,000 $ 1.00 9.51 $ - Granted 56,250 $ 1.67 9.53 $ - Exercised - Forfeited or expired (210,000 ) $ - Outstanding at September 30, 2017 1,111,250 $ 1.03 8.38 $ - Exercisable at September 30, 2017 491, 248 $ 1.00 7.84 $ - Vested and expected to vest at September 30, 2017 1,111,250 $ 1.03 8.38 $ - There were zero 56,250 2016 three nine September 30, 2017, 2017 $8,500 $31,200, No nine September 30, 2017. September 30, 2017, $75,500 .90 The Company recorded stock-based compensation expense in the periods presented as follows: Successor Successor Predecessor Nine Months ended September 30, 2017 Period from May 5, 2016 through September 30, 2016 Period from January 1, 2016 through May 4, 2016 Sales and marketing $ 3,906 $ - $ 18,504 Research and development 9,201 - 6,858 General and administrative 29,199 - 29,719 $ 42,306 $ - $ 55,081 Successor Successor Three Months ended September 30, 2017 Three Months ended September 30, 2016 Sales and marketing $ 1,392 $ - Research and development 2,978 - General and administrative 9,965 - $ 14,335 $ - |
Note 10 - Fair Value Measuremen
Note 10 - Fair Value Measurements | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Fair Value Disclosures [Text Block] | Note 10 – Fair Value Measurements Financial Instruments Carried at Cost Short-term financial instruments in our consolidated balance sheets, including cash and cash equivalents other than money market funds (which are carried at fair value), accounts, and other receivables and accounts payable, are carried at cost which approximates fair value, due to their short-term nature. Fair Value Measurements Our consolidated balance sheets include certain financial instruments that are carried at fair value. Fair value is the price that would be received from the sale of an asset or paid to transfer a liability assuming an orderly transaction in the most advantageous market at the measurement date. U.S. GAAP establishes a hierarchical disclosure framework which prioritizes and ranks the level of observability of inputs used in measuring fair value. These tiers include: ● Level 1, ● Level 2, 1 not ● Level 3, no An asset ’s or liability’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. At each reporting period, we perform a detailed analysis of our assets and liabilities that are measured at fair value. All assets and liabilities for which the fair value measurement is based on significant unobservable inputs or instruments which trade infrequently, and therefore have little or no 3. Financial Assets and Liabilities Measured at Fair Value The Company had no September 30, 2017 December 31, 2016. Non-Financial Assets and Liabilities Measured at Fair Value The Company ’s property and equipment and intangible assets (including goodwill) are measured at fair value on a non-recurring basis, upon establishment pursuant to fresh start accounting, and upon impairment. As a result of events and circumstances in the quarter ended June 30, 2017 consequently, the goodwill balance of approximately $2.1 June 30, 2017 ( 7 Goodwill and Other Intangible Assets September 30, 2017 zero |
Note 11 - Commitments and Conti
Note 11 - Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Commitments and Contingencies Disclosure [Text Block] | Note 11 – Commitments and Contingencies As of the Effective Date, the Company entered into a registration rights agreement (the “Registration Rights Agreement”) with the Recapitalization Investors. The Registration Rights Agreement provides certain resale registration rights to the Investors with respect to securities received in the Recapitalization Financing. Pursuant to the Registration Rights Agreement, the Company filed, and has to update periodically, a registration statement with the U.S. Securities and Exchange Commission that covers the resale of all shares of New Common Stock issued to the Investors on the Effective Date until such time as such shares have been sold or may 144 Our primary office and warehouse facilities are located in Gaithersburg, Maryland, and comprise approximately 12,000 two $18,700 September 2019. 2,100 $4,200 April 30, 2018. 16,300 $22,100 December 31, 2018. 401 July 31, 2014, August 1, 2014. $14,600 December 31, 2018. |
Significant Accounting Policies
Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Liquidity, Policy [Policy Text Block] | Liquidity Our operations are subject to significant risks and uncertainties including, among others, those relating to ease of access to capital on acceptable terms, current and potential competitors with greater resources, dependence on significant customers, lack of operating history, and uncertainty of future profitability and fluctuations in financial results. Since our inception, we have financed our operations by raising debt, issuing equity and equity-linked instruments, and executing licensing arrangements, and to a lesser extent by generating royalties and product revenues. We have incurred, and continue to incur, recurring operating losses and negative cash flows. During the quarter ended September 30, 2017, 12,800,000 $3.0 September 30, 2017, $1.9 The accompanying consolidated financial statements have been prepared assuming that we will continue as a going concern, which contemplates continuity of operations, realization of assets, and satisfaction of liabilities in the ordinary course of business. The propriety of using the going-concern basis is dependent upon, among other things, the ability to generate sufficient cash from operations, and potential other funding sources, including cash on hand, to meet our obligations as they become due. We believe based on the operating cash requirements and capital expenditures expected for the next twelve first 2018. We require additional capital prior to the end of the first 2018 may may may not may not If we are unable to secure sufficient capital to fund our operating activities or we are unable to increase revenues significantly, we may As noted in Note 2 – Fresh Start Accounting January 1, 2017. |
Basis of Accounting, Policy [Policy Text Block] | Basis of Presentation The accompanying unaudited interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). In our opinion, the accompanying unaudited interim consolidated financial statements include all adjustments, consisting of normal recurring adjustments, which are necessary to present fairly our financial position, results of operations and cash flows. The consolidated balance sheet at December 31, 2016, not may 2 – Fresh Start Accounting May 5, 2016 not not Company’s Annual Report on Form 10 December 31, 2016. |
Consolidation, Policy [Policy Text Block] | Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned and controlled subsidiary Aldagen, Inc. (“Aldagen”). All significant inter-company accounts and transactions are eliminated in consolidation. |
Use of Estimates, Policy [Policy Text Block] | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. In the accompanying consolidated financial statements, estimates are used for, but not |
Concentration Risk, Credit Risk, Policy [Policy Text Block] | Credit Concentration We generate accounts receivable from the sale of our products. In addition, other receivables consist primarily of the receivable due from our contract manufacturer for the cost of raw materials required to manufacture the Angel products that are purchased by the Company and immediately resold, at cost, to the contract manufacturer and a refund due for Delaware franchise taxes. Specific customer or other receivables balances in excess of 10% September 30, 2017 December 31, 2016 Successor Successor September 30, 2017 December 31, 2016 Other receivable A 65% 58% Customer B - 10% Revenue from significant customers exceeding 10% Successor Successor Three months ended September 30, 2017 Three months ended September 30, 2016 Customer A 25% 21% Customer B 13% 24% Customer C - 14% Customer D 11% - Successor Successor Predecessor Nine months ended September 30, 2017 Period from May 5, 2016 through September 30, 2016 Period from January 1, 2016 through May 4, 2016 Customer A - - 78% Customer B 27% 20% - Customer C 11% 20% - Customer D - 11% - Historically, we used single suppliers for several components of the Aurix product line. We outsource the manufacturing of various products to contract manufacturers. While we believe these manufacturers demonstrate competency, reliability and stability, there is no one not |
Cash and Cash Equivalents, Policy [Policy Text Block] | Cash Equivalents We consider all highly liquid instruments purchased with an original maturity of three 1.7 $250,000 September 30, 2017. |
Receivables, Policy [Policy Text Block] | Accounts Receivables We generate accounts receivables from the sale of our products. We provide for an allowance against receivables for estimated losses that may ’s inability or unwillingness to pay. The allowance for doubtful accounts is estimated primarily based upon historical write-off percentages, known problem accounts, and current economic conditions. Accounts are written off against the allowance for doubtful accounts when we determine that amounts are not September 30, 2017, $306,000, December 31, 2016, $409,000, |
Inventory, Policy [Policy Text Block] | Inventory Our inventory is produced by third first first 18 two As of September 30, 2017, $35,200 $36,900 December 31, 2016, $18,100 $59,800 We provide for an allowance against inventory for estimated losses that may ’s remaining shelf-life and our anticipated ability to sell such inventory, which is estimated using historical usage and future forecasts, within its remaining shelf life. At September 30, 2017 December 31, 2016, $8,000. |
Property, Plant and Equipment, Policy [Policy Text Block] | Property and Equipment Property and equipment is stated at cost less accumulated depreciation and is depreciated, using the straight-line method, over its estimated useful life ranging from one six one three Centrifuges may no no Property and equipment is reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not |
Goodwill and Intangible Assets, Policy [Policy Text Block] | Goodwill and Other Intangible Assets Predecessor intangible assets and goodwill In conjunction with the application of fresh start accounting, all then-remaining finite lived intangible assets, including those acquired as part of our acquisition of the Angel business were written off as of the Effective Date (see Note 2 – Fresh Start Accounting Successor intangible assets and goodwill In the Successor Company financial statements, intangible assets were established as part of fresh start accounting and relate to trademarks, technology, clinician relationships, and goodwill (see Note 2 – Fresh Start Accounting Our finite-lived intangible assets include trademarks, technology (including patents), and clinician relationships, and are amortized over their useful lives and reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not not not Goodwill represents the excess of reorganization value over the fair value of tangible and identifiable intangible assets and the fair value of liabilities as of the Effective Date. Goodwill is not December 31, not one Prior to the adoption of Accounting Standards Update 2017 04 – Intangibles - Goodwill and Other (Topic 350 January 1, 2017, first not no Detailed impairment testing involved comparing the fair value of our one no second second one one one not Under the new guidance, we perform our annual, or interim, goodwill impairment test by comparing the fair value of our one ’s fair value; however, the loss recognized should not not December 31, 2016 not 2017 04. June 30, 2017, not June 30, 2017. June 30, 2017 $2.8 $2.1 zero June 30, 2017. |
Revenue Recognition, Policy [Policy Text Block] | Revenue Recognition – Successor Company We recognize revenue when the four 1 2 3 4 We provide for the sale of our products, including disposable processing sets and supplies to customers. Revenue from the sale of products is recognized upon shipment of products to the customers. We do not not not Revenue Recognition – Predecessor Company The Predecessor Company provided for the sale of our products, including disposable processing sets and supplies to customers, and to Arthrex as distributor of the Angel product line. Revenue from the sale of products was recognized upon shipment. Usage or leasing of blood separation equipment As a result of the acquisition of the Angel business, we acquired various multiple element revenue arrangements that combined the (i) usage or leasing of blood separation processing equipment, (ii) maintenance of processing equipment, and (iii) purchase of disposable processing sets and supplies. We assigned these multiple element revenue arrangements to Arthrex in 2013 no License Agreement with Rohto The Company ’s license agreement with Rohto (see Note 4 – Distribution, Licensing and Collaboration Arrangements |
Segment Reporting, Policy [Policy Text Block] | Segments and Geographic Information Approximately 25% 21% three September 30, 2017 2016, 27% 12% nine September 30, 2017 2016, one |
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] | Stock-Based Compensation Prior to the Effective Date, the Company, from time to time, issued stock options or stock awards to employees, directors, consultants, and other service providers under its 2002 2013 9 – Equity and Stock-Based Compensation All outstanding stock options were cancelled as of the Effective Date. In July 2016, August 2016 ’s 2016 “2016 November 21, 2016, 2016 three nine September 30, 2017, zero 56,250 1,362,500 three nine September 30, 2016. The fair value of employee stock options is measured at the date of grant. Expected volatilities for the 2016 five ’s stock, and Company data was utilized to estimate option exercises and employee terminations within the valuation model. The risk-free rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. The Company estimated that the dividend rate on its common stock will be zero. The assumptions used are summarized in the following table: Successor Successor Nine Months ended September 30, 2017 Year ended December 31, 2016 Risk free rate 2.0 - 2.1% 1.8 - 2.0% Weighted average expected years until exercise 5.0 - 6.0 4.8 - 6.0 Expected stock volatility 83% 83% Dividend yield - - Stock-based compensation for awards granted to non-employees is periodically re-measured as the underlying awards vest. The Company recognizes an expense for such awards throughout the performance period as the services are provided by the non-employees, based on the fair value of these options and warrants at each reporting period. The fair value of stock options and compensatory warrants issued to service providers utilizes the same methodology with the exception of the expected term. For awards to non-employees, the Company estimates that the options or warrants will be held for the full term. The Company adopted new accounting guidance on January 1, 2017 not |
Income Tax, Policy [Policy Text Block] | Income Taxes The Company accounts for income taxes using the asset and liability method. Under the asset and liability method, current income tax expense or benefit is the amount of income taxes expected to be payable or refundable for the current year. A deferred income tax asset or liability is recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax credits and loss carryforwards. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not not The Company ’s policy for recording interest and penalties associated with audits is to record such items as a component of income before taxes. There were no 2017 2016. |
Earnings Per Share, Policy [Policy Text Block] | Basic and Diluted Earnings (Loss) per Share Basic earnings (loss) per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of shares of common stock outstanding (including contingently issuable shares when the contingencies have been resolved) during the period. For periods of net loss, diluted loss per share is calculated similarly to basic loss per share because the impact of all dilutive potential common shares is anti-dilutive. For periods of net income, and when the effects are not All of the Company ’s outstanding stock options and warrants were considered anti-dilutive for the three nine September 30, 2017. January 1, 2016 May 4, 2016 April 1, 2016 May 4, 2016, three nine September 30, 2017, 1,111,250 6,180,000 May 5, 2016 September 30, 2016, 6,180,000 January 1, 2016 May 4, 2016, 9,173,119 113,629,178 Earnings (loss) per share are calculated for basic and diluted earnings per share as follows: Successor Successor Three Months ended September 30, 2017 Three Months ended September 30, 2016 Numerator for net loss for basic and diluted loss per share $ (1,376,899 ) $ (1,916,673 ) Denominator for basic and fully diluted loss per share weighted average outstanding common shares 15,852,764 9,927,112 Basic and diluted loss per share Basic $ (0.09 ) $ (0.19 ) Diluted $ (0.09 ) $ (0.19 ) Successor Successor Predecessor Nine Months ended September 30, 2017 Period from May 5, 2016 through September 30, 2016 Period from January 1, 2016 through May 5, 2016 Numerator for basic income (loss) per share $ (6,981,560 ) $ (3,211,516 ) $ 28,173,934 Numerator adjustments for potential dilutive securities - - 172,546 Numerator for diluted income (loss) per share $ (6,981,560 ) $ (3,211,516 ) $ 28,346,480 Denominator for basic income (loss) per share weighted average outstanding common shares 11,924,035 9,876,605 125,951,100 Dilutive effect of convertible debt - - 67,307,692 Denominator for diluted income (loss) per share 11,924,035 9,876,605 193,258,792 Basic and diluted earnings (loss) per share Basic $ (0.59 ) $ (0.33 ) $ 0.22 Diluted $ (0.59 ) $ (0.33 ) $ 0.15 |
New Accounting Pronouncements, Policy [Policy Text Block] | Recently Adopted Accounting Pronouncements In July 2015, 330 December 15, 2016, January 1, 2017; not In November 2015, December 15, 2016. January 1, 2017; not In March 2016, December 15, 2016, The adoption of certain amendments of the guidance must be applied prospectively, and adoption of the remaining amendments must be applied either on a modified retrospective basis or retrospectively to all periods presented. We adopted this pronouncement effective January 1, 2017; not In January 2017, 2 2, ’s fair value; however, the loss recognized should not zero 2 December 15, 2021. January 1, 2017. January 1, 2017; not not 2017 04. one June 30, 2017, $2.8 $2.1 zero June 30, 2017. Unadopted Accounting Pronouncements In May 2014, five 1 2 3 4 5 August 2015, one December 15, 2017, December 15, 2016. March 2016, April 2016, May 2016, two March 3, 2016 May 2016, In February 2016, December 15, 2018, In June 2016, December 15, 2019. December 15, 2018. We are currently evaluating the impact, if any, that the adoption of this guidance will have on our consolidated financial statements. In August 2016, December 15, 2017. may In November 2016, December 15, 2017. In January 2017, not December 15, 2018. In May 2017, 718. 718 December 15, 2017. 1 not 2 not We have evaluated all other issued and unadopted Accounting Standards Updates and believe the adoption of these standards will not |
Note 2 - Fresh Start Accounti18
Note 2 - Fresh Start Accounting (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Notes Tables | |
Schedule of Allocated Determined Reorganization Value [Table Text Block] | Enterprise Value $ 17,889 Plus estimated fair value of liabilities 6,161 Reorganization Value 24,050 Less: Estimated fair value of tangible assets (13,574 ) Estimated fair value of identifiable intangible assets (8,397 ) Goodwill $ 2,079 |
Schedule of Fresh-Start Adjustments [Table Text Block] | Predecessor Company Reorganization Adjustments Fresh Start Adjustments Successor Company ASSETS Current assets Cash and cash equivalents $ 3,305,709 $ 7,052,500 (1) $ 10,358,209 Restricted cash 53,463 53,463 Accounts and other receivable, net 1,288,445 1,288,445 Inventory, net 56,348 56,348 Prepaid expenses and other current assets 611,593 $ (16,053 )(b) 595,540 Total current assets 5,315,558 (16,053 ) 7,052,500 12,352,005 Property and equipment, net 865,716 865,716 Deferred costs and other assets 355,741 355,741 Intangible assets, net 2,406,457 (2,406,457 )(a) 8,397,000 (2) 8,397,000 Goodwill - 2,079,284 (2) 2,079,284 TOTAL ASSETS $ 8,943,472 $ (2,422,510 ) $ 17,528,784 $ 24,049,746 LIABILITIES AND EQUITY (DEFICIT) Current liabilities not subject to compromise Accounts payable $ 2,877,170 $ 2,877,170 Accrued expenses and liabilities 3,112,244 3,112,244 Deferred revenue, current portion 899,920 $ (899,920 )(c) - Short term debtor-in-possession note payable 5,750,000 (5,750,000 )(d) - Total current liabilities not subject to compromise 12,639,334 (6,649,920 ) $ - 5,989,414 Non-current liabilities not subject to compromise Deferred revenue - - Other liabilities 171,613 171,613 Total non-current liabilities not subject to compromise 171,613 - - 171,613 Liabilities subject to compromise Accounts payable 214,554 (214,554 )(e) - Accrued expenses and liabilities 559,202 (559,202 )(e) - Accrued interest 3,316,121 (3,316,121 )(d) - Deferred revenue - - Convertible debt subject to put rights 35,000,000 (35,000,000 )(d) - Total liabilities subject to compromise 39,089,877 (39,089,877 ) - - TOTAL LIABILITIES 51,900,824 (45,739,797 ) - 6,161,027 Conditionally redeemable common stock 500,000 (500,000 )(f) - Common stock outstanding, at par 12,477 (12,477 )(f) 750 (1) 750 Common stock issuable 392,950 (392,950 )(f) - Preferred stock outstanding, at par - 3 (3) 3 Additional paid-in capital 126,011,808 (126,011,808 )(f) 17,887,966 (4) 17,887,966 Retained earnings (accumulated deficit) (169,874,587 ) 170,234,522 (g) (359,935 )(5) - TOTAL EQUITY (DEFICIT) (43,457,352 ) 43,817,287 17,528,784 17,888,719 TOTAL LIABILITIES AND EQUITY (DEFICIT) $ 8,943,472 $ (2,422,510 ) $ 17,528,784 $ 24,049,746 |
Schedule of Cumulative Reorganization Adjustments [Table Text Block] | Description Adjustment Amount Elimination of existing intangible assets (a) $ (2,406,457 ) Elimination of prepaid Angel expenses (b) (16,053 ) Elimination of Angel deferred revenue (c) 899,920 Termination of debt agreements and accrued interest (d) 44,066,121 Elimination of various payables and accruals (e) 773,756 Cancellation of existing equity (f) 126,917,235 Cumulative impact of the reorganization adjustments (g) $ 170,234,522 |
Fresh Start Adjustments, Schedule of Allocated Determined Reorganzation Value [Table Text Block] | Enterprise Value $ 17,889 Plus estimated fair value of liabilities 6,161 Reorganization Value 24,050 Less: Estimated fair value of tangible assets (13,574 ) Estimated fair value of identifiable intangible assets (8,397 ) Goodwill $ 2,079 |
Cumulative Impact of Fresh Start Adjustments on Additional Paid in Capital [Table Text Block] | Description Adjustment Amount Cash proceeds from issuance of common stock (1) $ 7,052,500 Establishment of intangible assets (2) 10,476,284 Net assets of the predecessor (5) 359,935 Less par value of common and preferred stock (3) (753 ) Cumulative impact of the fresh start adjustments described above on additional paid-in-capital (4) $ 17,887,966 |
Schedule of Reorganization Costs [Table Text Block] | Successor Predecessor Period from May 5, 2016 through September 30, 2016 Period from January 1, 2016 through May 4, 2016 Professional fees $ 324,551 $ 3,598,216 Net gain on reorganization adjustments - (34,869,566 ) Reorganization items, net $ 324,551 $ (31,271,350 ) Cash payments for reorganization items $ 1,507,863 $ 1,839,560 |
Note 3 - Liquidity and Summar19
Note 3 - Liquidity and Summary of Significant Accounting Principles (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Notes Tables | |
Schedules of Concentration of Risk, by Risk Factor [Table Text Block] | Successor Successor September 30, 2017 December 31, 2016 Other receivable A 65% 58% Customer B - 10% Successor Successor Three months ended September 30, 2017 Three months ended September 30, 2016 Customer A 25% 21% Customer B 13% 24% Customer C - 14% Customer D 11% - Successor Successor Predecessor Nine months ended September 30, 2017 Period from May 5, 2016 through September 30, 2016 Period from January 1, 2016 through May 4, 2016 Customer A - - 78% Customer B 27% 20% - Customer C 11% 20% - Customer D - 11% - |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block] | Successor Successor Nine Months ended September 30, 2017 Year ended December 31, 2016 Risk free rate 2.0 - 2.1% 1.8 - 2.0% Weighted average expected years until exercise 5.0 - 6.0 4.8 - 6.0 Expected stock volatility 83% 83% Dividend yield - - |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | Successor Successor Three Months ended September 30, 2017 Three Months ended September 30, 2016 Numerator for net loss for basic and diluted loss per share $ (1,376,899 ) $ (1,916,673 ) Denominator for basic and fully diluted loss per share weighted average outstanding common shares 15,852,764 9,927,112 Basic and diluted loss per share Basic $ (0.09 ) $ (0.19 ) Diluted $ (0.09 ) $ (0.19 ) Successor Successor Predecessor Nine Months ended September 30, 2017 Period from May 5, 2016 through September 30, 2016 Period from January 1, 2016 through May 4, 2016 Numerator for basic income (loss) per share $ (6,981,560 ) $ (3,211,516 ) $ 28,173,934 Numerator adjustments for potential dilutive securities - - 172,546 Numerator for diluted income (loss) per share $ (6,981,560 ) $ (3,211,516 ) $ 28,346,480 Denominator for basic income (loss) per share weighted average outstanding common shares 11,924,035 9,876,605 125,951,100 Dilutive effect of convertible debt - - 67,307,692 Denominator for diluted income (loss) per share 11,924,035 9,876,605 193,258,792 Basic and diluted earnings (loss) per share Basic $ (0.59 ) $ (0.33 ) $ 0.22 Diluted $ (0.59 ) $ (0.33 ) $ 0.15 |
Note 5 - Receivables (Tables)
Note 5 - Receivables (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Notes Tables | |
Schedule of Accounts, Notes, Loans and Financing Receivable [Table Text Block] | Successor Successor September 30, 2017 December 31, 2016 Trade receivables $ 116,802 $ 100,660 Other receivables 352,722 603,015 469,524 703,675 Less allowance for doubtful accounts (305,896 ) (409,377 ) Accounts and other receivable, net $ 163,628 $ 294,298 |
Note 6 - Property and Equipme21
Note 6 - Property and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Notes Tables | |
Property, Plant and Equipment [Table Text Block] | Successor Successor September 30, 2017 December 31, 2016 Medical equipment $ 402,234 $ 405,096 Office equipment 48,888 48,888 Software 257,619 257,619 Manufacturing equipment 34,899 34,899 Leasehold improvements 19,215 19,215 762,855 765,717 Less accumulated depreciation and amortization (506,968 ) (279,601 ) Property and equipment, net $ 255,887 $ 486,116 |
Note 7 - Goodwill and Other I22
Note 7 - Goodwill and Other Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Notes Tables | |
Schedule of Intangible Assets and Goodwill [Table Text Block] | Successor Successor September 30, 2017 December 31, 2016 Trademarks $ 917,000 $ 917,000 Technology 6,576,000 6,576,000 Customer and clinician relationships 904,000 904,000 8,397,000 8,397,000 Accumulated amortization trademarks (85,784 ) (39,934 ) Accumulated amortization technology (1,025,290 ) (477,290 ) Accumulated amortization customer and clinician relationships (84,568 ) (39,368 ) (1,195,642 ) (556,592 ) $ 7,201,358 $ 7,840,408 |
Schedule of Goodwill [Table Text Block] | Successor Balance, at December 31, 2015 $ - Fresh start accounting 2,079,284 Balance, at December 31, 2016 2,079,284 Impairment of goodwill (2,079,284 ) Balance, at September 30, 2017 $ - |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block] | 2017 (Fourth quarter 2017) $ 213,000 2018 852,000 2019 852,000 2020 852,000 2021 852,000 Thereafter 3,580,000 |
Note 9 - Equity and Stock-bas23
Note 9 - Equity and Stock-based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Notes Tables | |
Share-based Compensation, Stock Options, Activity [Table Text Block] | Stock Options – 2016 Omnibus Plan Shares Weighted Average Weighted Average Aggregate Intrinsic Outstanding at December 31, 2016 1,265,000 $ 1.00 9.51 $ - Granted 56,250 $ 1.67 9.53 $ - Exercised - Forfeited or expired (210,000 ) $ - Outstanding at September 30, 2017 1,111,250 $ 1.03 8.38 $ - Exercisable at September 30, 2017 491, 248 $ 1.00 7.84 $ - Vested and expected to vest at September 30, 2017 1,111,250 $ 1.03 8.38 $ - |
Schedule of Compensation Cost for Share-based Payment Arrangements, Allocation of Share-based Compensation Costs by Plan [Table Text Block] | Successor Successor Predecessor Nine Months ended September 30, 2017 Period from May 5, 2016 through September 30, 2016 Period from January 1, 2016 through May 4, 2016 Sales and marketing $ 3,906 $ - $ 18,504 Research and development 9,201 - 6,858 General and administrative 29,199 - 29,719 $ 42,306 $ - $ 55,081 Successor Successor Three Months ended September 30, 2017 Three Months ended September 30, 2016 Sales and marketing $ 1,392 $ - Research and development 2,978 - General and administrative 9,965 - $ 14,335 $ - |
Note 1 - Description of Busin24
Note 1 - Description of Business and Bankruptcy Proceedings (Details Textual) | Aug. 10, 2017USD ($)shares | Jun. 20, 2016USD ($)shares | May 05, 2016USD ($)$ / sharesshares | Sep. 30, 2017USD ($)$ / sharesshares | Sep. 30, 2017USD ($)$ / sharesshares | Sep. 30, 2017USD ($)$ / sharesshares | Dec. 31, 2016USD ($)$ / sharesshares | May 04, 2016$ / shares |
Common Stock, Par or Stated Value Per Share | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.001 | $ 0.0001 | |||
Stock Issued During Period, Shares, New Issues | 12,800,000 | 12,800,000 | 12,800,000 | |||||
Proceeds from Issuance of Common Stock | $ | $ 3,000,000 | $ 3,000,000 | ||||||
Payment for Offering Cost | $ | $ 100,000 | |||||||
Preferred Stock, Shares Authorized | 1,000,000 | 1,000,000 | 1,000,000 | 1,000,000 | ||||
Preferred Stock, Par or Stated Value Per Share | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.001 | ||||
Preferred Stock, Liquidation Preference, Value | $ | $ 29,038,000 | $ 29,038,000 | $ 29,038,000 | $ 29,038,000 | ||||
Warrant, Expiration Date | May 5, 2021 | |||||||
Class of Warrant or Right, Date from which Warrants or Rights Exercisable | Nov. 5, 2016 | |||||||
Arthrex [Member] | ||||||||
Reduction in Allowed Claim | $ | $ 15,000,000 | |||||||
Series A Preferred Stock [Member] | ||||||||
Common Stock, Par or Stated Value Per Share | $ / shares | $ 0.0001 | |||||||
Stock Issued During Period, Shares, New Issues | 29,038 | |||||||
Preferred Stock, Shares Authorized | 29,038 | |||||||
Preferred Stock, Par or Stated Value Per Share | $ / shares | $ 0.0001 | |||||||
Preferred Stock, Liquidation Preference, Value | $ | $ 29,038,000 | |||||||
Number of Board Members Nominated and Elected by Shareholders | 1 | |||||||
Preferred Stock, Voting Rights, Percentage of Voting Rights of Capital Stock | 1.00% | |||||||
Preferred Stock, Voting Rights, Number of Votes Per Share | 5 | |||||||
Series A Preferred Stock [Member] | Deerfield Lenders [Member] | ||||||||
Stock Issued During Period, Shares, New Issues | 29,038 | |||||||
Maximum [Member] | Series A Preferred Stock [Member] | ||||||||
Preferred Stock, Voting Rights, Percentage of Voting Rights of Capital Stock | 1.00% | |||||||
Common Stock [Member] | ||||||||
Common Stock, Par or Stated Value Per Share | $ / shares | $ 0.0001 | |||||||
Stock Issued During Period, Shares, New Issues | 7,500,000 | |||||||
Proceeds from Issuance of Common Stock | $ | $ 7,300,000 | |||||||
Proceeds from Issuance of Common Stock, Net of Issuance Costs | $ | $ 7,052,500 | |||||||
Stock Issued During Period, Shares, Other | 200,000 | |||||||
Payment for Offering Cost | $ | $ 100,000 | |||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 6,180,000 | |||||||
Warrant, Expiration Date | May 5, 2021 | |||||||
Class of Warrant or Right, Date from which Warrants or Rights Exercisable | Nov. 5, 2016 | |||||||
Common Stock [Member] | Deerfield Lenders [Member] | ||||||||
Stock Issued During Period, Shares, New Issues | 29,038 | |||||||
Common Stock [Member] | Backstop Commitment [Member] | ||||||||
Number of Shares Commited to Purchase | 12,800,000 | |||||||
Value of Shares Commited to Purchase | $ | $ 3,000,000 | |||||||
Common Stock [Member] | Minimum [Member] | ||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 0.50 | |||||||
Common Stock [Member] | Maximum [Member] | ||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 1 | |||||||
Exchange Shares [Member] | ||||||||
Stock Issued During Period, Shares, New Issues | 2,264,612 | |||||||
Number of Shares Commited to Issue | 3,000,000 | |||||||
Shares of Old Common Stock to New Common Stock, Conversion Ratio | 41.8934 | |||||||
Administrative Claim Shares [Member] | ||||||||
Stock Issued During Period, Shares, New Issues | 162,500 | |||||||
Stock Issued During Period, Shares, Issued for Services | 100,000 | |||||||
Debt Conversion, Converted Instrument, Shares Issued | 62,500 | |||||||
Debt Conversion, Original Debt, Amount | $ | $ 62,500 | |||||||
Platelet Rich Plasma (PRP) [Member] | ||||||||
Number of Products Produced | 2 |
Note 2 - Fresh Start Accounti25
Note 2 - Fresh Start Accounting (Details Textual) - USD ($) | Aug. 10, 2017 | May 05, 2016 | Sep. 30, 2017 | Sep. 30, 2017 | Sep. 30, 2016 | Jun. 30, 2017 | Sep. 30, 2017 | Dec. 31, 2016 | May 04, 2016 | Dec. 31, 2015 |
Fresh Start Accounting, Percent of Voting Share of Emerging Entity | 50.00% | |||||||||
Reorganization Value | $ 24,050,000 | $ 24,050,000 | ||||||||
Debt-free Net Cash Flow Growth Rate | 3.40% | |||||||||
Fair Value Inputs, Discount Rate | 29.00% | |||||||||
Goodwill, Impairment Loss | $ 2,100,000 | $ 2,079,284 | ||||||||
Stock Issued During Period, Shares, New Issues | 12,800,000 | 12,800,000 | 12,800,000 | |||||||
Intangible Assets, Net (Excluding Goodwill) | $ 8,400,000 | $ 7,201,358 | $ 7,201,358 | 7,201,358 | $ 7,840,408 | |||||
Goodwill | $ 2,100,000 | 0 | 0 | $ 0 | 0 | 2,079,284 | $ 0 | |||
Preferred Stock, Liquidation Preference, Value | $ 29,038,000 | $ 29,038,000 | $ 29,038,000 | $ 29,038,000 | ||||||
Class of Warrant or Right, Date from which Warrants or Rights Exercisable | Nov. 5, 2016 | |||||||||
Warrant, Expiration Date | May 5, 2021 | |||||||||
Series A Preferred Stock [Member] | ||||||||||
Stock Issued During Period, Shares, New Issues | 29,038 | |||||||||
Preferred Stock, Liquidation Preference, Value | $ 29,038,000 | |||||||||
Common Stock [Member] | ||||||||||
Stock Issued During Period, Shares, New Issues | 7,500,000 | |||||||||
Proceeds from Issuance of Common Stock, Net of Issuance Costs | $ 7,052,500 | |||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 6,180,000 | |||||||||
Class of Warrant or Right, Date from which Warrants or Rights Exercisable | Nov. 5, 2016 | |||||||||
Warrant, Expiration Date | May 5, 2021 | |||||||||
Common Stock [Member] | Backstop Commitment [Member] | ||||||||||
Number of Shares Commited to Purchase | 12,800,000 | |||||||||
Value of Shares Commited to Purchase | $ 3,000,000 | |||||||||
Common Stock [Member] | Minimum [Member] | ||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 0.50 | |||||||||
Common Stock [Member] | Maximum [Member] | ||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1 | |||||||||
Revaluation of Assets [Member] | ||||||||||
Reorganization Value | $ 17,889,000 | $ 17,889,000 |
Note 2 - Fresh Start Accounti26
Note 2 - Fresh Start Accounting - Reorganization Value (Details) - USD ($) | May 05, 2016 | May 04, 2016 |
Reorganization Value | $ 24,050,000 | $ 24,050,000 |
Estimated fair value of tangible assets | (13,574,000) | (13,574,000) |
Estimated fair value of identifiable intangible assets | (8,397,000) | (8,397,000) |
Goodwill | 2,079,284 | 2,079,000 |
Revaluation of Assets [Member] | ||
Reorganization Value | 17,889,000 | 17,889,000 |
Revaluation of Liabilities [Member] | ||
Reorganization Value | $ 6,161,000 | $ 6,161,000 |
Note 2 - Fresh Start Accounti27
Note 2 - Fresh Start Accounting - Fresh Start Adjustments (Details) - USD ($) | Dec. 31, 2016 | May 05, 2016 | May 04, 2016 | ||
Cash and cash equivalents, predecessor company | $ 3,305,709 | ||||
Cash proceeds from issuance of common stock | [1],[2] | 7,052,500 | |||
Cash and cash equivalents, successor company | 10,358,209 | ||||
Restricted cash, predecessor company | 53,463 | ||||
Restricted cash, successor company | 53,463 | ||||
Accounts and other receivable, net, predecessor company | 1,288,445 | ||||
Accounts and other receivable, net, successor company | 1,288,445 | ||||
Inventory, net, predecessor company | 56,348 | ||||
Inventory, net, successor company | 56,348 | ||||
Prepaid expenses and other current assets, predecessor company | 611,593 | ||||
Elimination of prepaid Angel expenses | [3],[4] | (16,053) | |||
Prepaid expenses and other current assets, successor company | 595,540 | ||||
Total current assets, predecessor company | 5,315,558 | ||||
Total current assets, reorganization adjustments | (16,053) | ||||
Total current assets, fresh start adjustment | 7,052,500 | ||||
Total current assets, successor company | 12,352,005 | ||||
Property and equipment, net, predecessor company | 865,716 | ||||
Property and equipment, net, successor company | 865,716 | ||||
Deferred costs and other assets, predecessor company | 355,741 | ||||
Deferred costs and other assets, successor company | 355,741 | ||||
Intangible assets, net, predecessor company | 2,406,457 | ||||
Elimination of existing intangible assets | [5] | (2,406,457) | |||
Intangible assets, net, fresh start adjustment | [6] | 8,397,000 | |||
Intangible assets, net, successor company | 8,397,000 | $ 8,397,000 | |||
Goodwill, predecessor company | 0 | ||||
Goodwill, fresh start adjustment | $ 2,079,284 | 2,079,284 | [6] | ||
Goodwill, successor company | 2,079,284 | $ 2,079,000 | |||
TOTAL ASSETS, predecessor company | 8,943,472 | ||||
TOTAL ASSETS, reorganization adjustments | (2,422,510) | ||||
TOTAL ASSETS, fresh start adjustment | 17,528,784 | ||||
TOTAL ASSETS, successor company | 24,049,746 | ||||
Deferred revenue, current portion, reorganization adjustments | [7] | (899,920) | |||
Total liabilities subject to compromise, predecessor company | 39,089,877 | ||||
Total liabilities subject to compromise, reorganization adjustments | (39,089,877) | ||||
Total liabilities subject to compromise, successor company | |||||
TOTAL LIABILITIES, predecessor company | 51,900,824 | ||||
TOTAL LIABILITIES, reorganization adjustments | (45,739,797) | ||||
TOTAL LIABILITIES, successor company | 6,161,027 | ||||
Conditionally redeemable common stock, predecessor company | 500,000 | ||||
Conditionally redeemable common stock, reorganization adjustments | [8] | (500,000) | |||
Conditionally redeemable common stock, successor company | |||||
Common stock outstanding, at par, predecessor company | 12,477 | ||||
Common stock outstanding, at par, reorganization adjustments | [8] | (12,477) | |||
Common stock outstanding, at par, fresh start adjustment | [1] | 750 | |||
Common stock outstanding, at par, successor company | 750 | ||||
Common stock issuable, predecessor company | 392,950 | ||||
Common stock issuable, reorganization adjustments | [8] | (392,950) | |||
Common stock issuable, successor company | |||||
Preferred stock outstanding, at par, predecessor company | 0 | ||||
Preferred stock outstanding, at par, fresh start adjustment | [9] | 3 | |||
Preferred stock outstanding, at par, successor company | 3 | ||||
Additional paid-in capital, predecessor company | 126,011,808 | ||||
Additional paid-in capital, reorganization adjustments | [8] | (126,011,808) | |||
Additional paid-in capital, fresh start adjustment | [10],[11] | 17,887,966 | |||
Additional paid-in capital, successor company | 17,887,966 | ||||
Retained earnings (accumulated deficit), predecessor company | (169,874,587) | ||||
Cumulative impact of the reorganization adjustments | [12],[13] | 170,234,522 | |||
Retained earnings (accumulated deficit), fresh start adjustment | [14],[15] | (359,935) | |||
Retained earnings (accumulated deficit), successor company | |||||
TOTAL EQUITY (DEFICIT), predecessor company | (43,457,352) | ||||
TOTAL EQUITY (DEFICIT), reorganization adjustments | 43,817,287 | ||||
TOTAL EQUITY (DEFICIT), fresh start adjustment | 17,528,784 | ||||
TOTAL EQUITY (DEFICIT), successor company | 17,888,719 | ||||
TOTAL LIABILITIES AND EQUITY (DEFICIT), predecessor company | 8,943,472 | ||||
TOTAL LIABILITIES AND EQUITY (DEFICIT), reorganization adjustments | (2,422,510) | ||||
TOTAL LIABILITIES AND EQUITY (DEFICIT), fresh start adjustment | 17,528,784 | ||||
TOTAL LIABILITIES AND EQUITY (DEFICIT), successor company | 24,049,746 | ||||
Liabilities Not Subject to Compromise [Member] | |||||
Accounts payable, predecessor company | 2,877,170 | ||||
Accounts payable, successor company | 2,877,170 | ||||
Accrued expenses and liabilities, predecessor company | 3,112,244 | ||||
Accrued expenses and liabilities, successor company | 3,112,244 | ||||
Deferred revenue, current portion, predecessor company | 899,920 | ||||
Deferred revenue, current portion, reorganization adjustments | [16] | (899,920) | |||
Deferred revenue, current portion, successor company | |||||
Short term debtor-in-possession note payable, predecessor company | 5,750,000 | ||||
Short term debtor-in-possession note payable, reorganization adjustments | [17] | (5,750,000) | |||
Short term debtor-in-possession note payable, successor company | |||||
Total current liabilities not subject to compromise, predecessor company | 12,639,334 | ||||
Total current liabilities not subject to compromise, reorganization adjustments | (6,649,920) | ||||
Total current liabilities not subject to compromise, successor company | 5,989,414 | ||||
Deferred revenue, predecessor company | 0 | ||||
Deferred revenue, successor company | |||||
Other liabilities, predecessor company | 171,613 | ||||
Other liabilities, successor company | 171,613 | ||||
Total non-current liabilities not subject to compromise, predecessor company | 171,613 | ||||
Total non-current liabilities not subject to compromise, successor company | 171,613 | ||||
Liabilities Subject to Compromise [Member] | |||||
Accounts payable, predecessor company | 214,554 | ||||
Accounts payable, successor company | |||||
Accrued expenses and liabilities, predecessor company | 559,202 | ||||
Accrued expenses and liabilities, successor company | |||||
Deferred revenue, current portion, successor company | |||||
Deferred revenue, predecessor company | 0 | ||||
Accounts payable, reorganization adjustments | [18] | (214,554) | |||
Accrued expenses and liabilities, reorganization adjustments | [18] | (559,202) | |||
Accrued interest, predecessor company | 3,316,121 | ||||
Accrued interest, reorganization adjustments | [17] | (3,316,121) | |||
Accrued interest, successor company | |||||
Convertible debt subject to put rights, predecessor company | 35,000,000 | ||||
Convertible debt subject to put rights, reorganization adjustments | [17] | (35,000,000) | |||
Convertible debt subject to put rights, successor company | |||||
[1] | Pursuant to the Plan of Reorganization, as of the Effective Date, the Company issued 7,500,000 shares of New Common Stock to certain accredited investors for net cash to the Company of $7,052,500. The Company also issued Warrants to purchase 6,180,000 shares of New Common Stock to certain of the investors. The Warrants terminate on May 5, 2021, and are exercisable at any time on or after November 5, 2016 at exercise prices ranging from $0.50 per share to $1.00 per share. The number of shares of New Common Stock underlying a Warrant and its exercise price are subject to customary adjustments upon subdivisions, combinations, payment of stock dividends, reclassifications, reorganizations and consolidations. Certain investors also provided Backstop Commitments to purchase up to 12,800,000 additional shares of New Common Stock for an aggregate purchase price of up to $3,000,000. The Company closed on issuance of the additional 12,800,000 shares of New Common Stock in August and September 2017. The New Common Stock, Warrants and Backstop Commitment are classified as equity. | ||||
[2] | Pursuant to the Plan of Reorganization, as of the Effective Date, the Company issued 7,500,000 shares of New Common Stock to certain accredited investors for net cash to the Company of $7,052,500. The Company also issued Warrants to purchase 6,180,000 shares of New Common Stock to certain of the investors. The Warrants terminate on May 5, 2021, and are exercisable at any time on or after November 5, 2016 at exercise prices ranging from $0.50 per share to $1.00 per share. The number of shares of New Common Stock underlying a Warrant and its exercise price are subject to customary adjustments upon subdivisions, combinations, payment of stock dividends, reclassifications, reorganizations and consolidations. Certain investors also provided Backstop Commitments to purchase up to 12,800,000 additional shares of New Common Stock for an aggregate purchase price of up to $3,000,000. The Company closed on issuance of the additional 12,800,000 shares of New Common Stock in August and September 2017. The New Common Stock, Warrants and Backstop Commitment are classified as equity. | ||||
[3] | Pursuant to the Plan of Reorganization, the Company assigned to Deerfield the Company's: (i) rights, title and interest in and to its existing license agreement with Arthrex; (ii) the associated intellectual property owned by the Company and licensed under such agreement; and (iii) rights to collect royalty payments thereunder. As such, certain prepaid expenses related to the Angel business were eliminated. | ||||
[4] | Pursuant to the Plan of Reorganization, the Company assigned to Deerfield the Company's: (i) rights, title and interest in and to its existing license agreement with Arthrex; (ii) the associated intellectual property owned by the Company and licensed under such agreement; and (iii) rights to collect royalty payments thereunder. As such, certain prepaid expenses related to the Angel business were eliminated. | ||||
[5] | As a result of fresh start accounting, all intangible assets existing as of the Effective Date were established at fair value. This adjustment eliminates the carrying value of previously existing intangible assets as of the Effective Date, as the underlying Angel assets were assigned to Deerfield pursuant to the Plan of Reorganization. | ||||
[6] | Represents identifiable intangible assets of approximately $8.4 million and goodwill of approximately $2.1 million. Upon the application of fresh start accounting, the Company allocated the reorganization value to its individual assets based on their estimated fair values. Reorganization value represents the fair value of the Successor Company's assets before considering liabilities, and the excess of reorganization value over the fair value of identified tangible and intangible assets is reported separately on the consolidated balance sheet as goodwill. The Company, with the assistance of external valuation specialists, estimated the enterprise value of the Company upon emergence from Chapter 11 bankruptcy to be $17.9 million. Enterprise value is defined as the total invested capital, which includes cash and cash equivalents. The estimate is based on a calculation of the present value of the projected future cash flows of the Company from May 5, 2016 through the year ending December 31, 2025, along with a terminal value. The Company estimated a terminal value using the Gordon Growth Model. In applying fresh start accounting, the Company followed these principles: The reorganization value, estimated as approximately $24.0 million, which represents the sum of the enterprise value and estimated fair value of noninterest bearing liabilities, was allocated to the Successor Company's assets based on their estimated fair values. The reorganization value exceeded the sum of the fair value assigned to the assets, and the excess was recognized as goodwill of the Successor Company as of May 5, 2016. Each liability existing as of May 5, 2016 has been stated at its estimated fair value. Deferred tax assets and liabilities have been recognized for differences between the assigned values and the tax basis of the recognized assets and liabilities, and have been fully valued as of May 5, 2016 to reduce deferred tax assets to the amounts expected to be realized. Pursuant to fresh start accounting the Company allocated the determined reorganization value to the Successor Company's assets as follows (in thousands): Enterprise Value $ 17,889 Plus estimated fair value of liabilities 6,161 Reorganization Value 24,050 Less: Estimated fair value of tangible assets (13,574) Estimated fair value of identifiable intangible assets (8,397) Goodwill $2,079 | ||||
[7] | Pursuant to the Plan of Reorganization, the Company assigned to Deerfield the Company's (i) rights, title and interest in and to its existing license agreement with Arthrex, (ii) the associated intellectual property owned by the Company and licensed under such agreement, and (iii) rights to collect royalty payments thereunder. As such, all deferred revenue related to the existing license agreement with Arthrex as of the Effective Date was eliminated. | ||||
[8] | Pursuant to the Plan of Reorganization, all equity interests of the Company, including but not limited to all shares of Old Common Stock, warrants and options that were issuable or issued and outstanding immediately prior to the Effective Date, were cancelled. The elimination of the carrying value of the cancelled equity interests was reflected as a direct charge to retained earnings (deficit). | ||||
[9] | Pursuant to the Plan of Reorganization, on the Effective Date, the Company issued 29,038 shares of Series A Preferred Stock to Deerfield. The Series A Preferred Stock has no stated maturity date, is not convertible or redeemable, and carries a liquidation preference of $29,038,000, which is required to be paid to holders of such Series A Preferred Stock before any payments are made with respect to shares of New Common Stock (and other capital stock that is not issued on parity or senior to the Series A Preferred Stock) upon a liquidation or change in control transaction. The Series A Preferred Stock is carried at par value and is classified as equity. | ||||
[10] | Reflects the cumulative impact of the fresh start adjustments described above on additional paid-in-capital: Description Adjustment Amount Cash proceeds from issuance of common stock(1) $7,052,500 Establishment of intangible assets (2) 10,476,284 Net assets of the predecessor(5)359,935 Less par value of common and preferred stock (3) (753)Cumulative impact of the fresh start adjustments described above on additional paid-in-capital (4)$17,887,966 | ||||
[11] | Reflects the cumulative impact of the fresh start adjustments described above on additional paid-in-capital: Description Adjustment Amount Cash proceeds from issuance of common stock(1) $7,052,500 Establishment of intangible assets (2) 10,476,284 Net assets of the predecessor(5)359,935 Less par value of common and preferred stock (3) (753)Cumulative impact of the fresh start adjustments described above on additional paid-in-capital (4)$17,887,966 | ||||
[12] | Represents the cumulative impact of the reorganization adjustments: | ||||
[13] | Represents the cumulative impact of the reorganization adjustments: | ||||
[14] | Reflects the elimination of retained earnings upon the application of fresh start accounting. | ||||
[15] | Reflects the elimination of retained earnings upon the application of fresh start accounting. | ||||
[16] | Pursuant to the Plan of Reorganization, the Company assigned to Deerfield the Company's (i) rights, title and interest in and to its existing license agreement with Arthrex, (ii) the associated intellectual property owned by the Company and licensed under such agreement, and (iii) rights to collect royalty payments thereunder. As such, all deferred revenue related to the existing license agreement with Arthrex as of the Effective Date was eliminated. | ||||
[17] | Pursuant to the Plan of Reorganization, the Company's obligations under the Deerfield Facility Agreement, including accrued interest, were cancelled, and the Company ceased to have any obligations thereunder. Additionally, pursuant to the Plan of Reorganization, the DIP Credit Agreement was terminated. | ||||
[18] | Represents claims not expected to be settled in cash. |
Note 2 - Fresh Start Accounti28
Note 2 - Fresh Start Accounting - Cumulative Impact of the Reorganization Adjustments (Details) | May 05, 2016USD ($) | |
Elimination of existing intangible assets | $ (2,406,457) | [1] |
Elimination of prepaid Angel expenses | (16,053) | [2],[3] |
Elimination of Angel deferred revenue | 899,920 | [4] |
Termination of debt agreements and accrued interest | 44,066,121 | [5] |
Elimination of various payables and accruals | 773,756 | [6] |
Cancellation of existing equity | 126,917,235 | [7] |
Cumulative impact of the reorganization adjustments | $ 170,234,522 | [8],[9] |
[1] | As a result of fresh start accounting, all intangible assets existing as of the Effective Date were established at fair value. This adjustment eliminates the carrying value of previously existing intangible assets as of the Effective Date, as the underlying Angel assets were assigned to Deerfield pursuant to the Plan of Reorganization. | |
[2] | Pursuant to the Plan of Reorganization, the Company assigned to Deerfield the Company's: (i) rights, title and interest in and to its existing license agreement with Arthrex; (ii) the associated intellectual property owned by the Company and licensed under such agreement; and (iii) rights to collect royalty payments thereunder. As such, certain prepaid expenses related to the Angel business were eliminated. | |
[3] | Pursuant to the Plan of Reorganization, the Company assigned to Deerfield the Company's: (i) rights, title and interest in and to its existing license agreement with Arthrex; (ii) the associated intellectual property owned by the Company and licensed under such agreement; and (iii) rights to collect royalty payments thereunder. As such, certain prepaid expenses related to the Angel business were eliminated. | |
[4] | Pursuant to the Plan of Reorganization, the Company assigned to Deerfield the Company's (i) rights, title and interest in and to its existing license agreement with Arthrex, (ii) the associated intellectual property owned by the Company and licensed under such agreement, and (iii) rights to collect royalty payments thereunder. As such, all deferred revenue related to the existing license agreement with Arthrex as of the Effective Date was eliminated. | |
[5] | Pursuant to the Plan of Reorganization, the Company's obligations under the Deerfield Facility Agreement, including accrued interest, were cancelled, and the Company ceased to have any obligations thereunder. Additionally, pursuant to the Plan of Reorganization, the DIP Credit Agreement was terminated. | |
[6] | Represents claims not expected to be settled in cash. | |
[7] | Pursuant to the Plan of Reorganization, all equity interests of the Company, including but not limited to all shares of Old Common Stock, warrants and options that were issuable or issued and outstanding immediately prior to the Effective Date, were cancelled. The elimination of the carrying value of the cancelled equity interests was reflected as a direct charge to retained earnings (deficit). | |
[8] | Represents the cumulative impact of the reorganization adjustments: | |
[9] | Represents the cumulative impact of the reorganization adjustments: |
Note 2 - Fresh Start Accounti29
Note 2 - Fresh Start Accounting - Reorganization Value of Fresh Start Adjustments (Details) - USD ($) | May 05, 2016 | May 04, 2016 |
Reorganization Value | $ 24,050,000 | $ 24,050,000 |
Estimated fair value of tangible assets | (13,574,000) | (13,574,000) |
Estimated fair value of identifiable intangible assets | (8,397,000) | (8,397,000) |
Goodwill | 2,079,284 | 2,079,000 |
Revaluation of Assets [Member] | ||
Reorganization Value | 17,889,000 | 17,889,000 |
Revaluation of Liabilities [Member] | ||
Reorganization Value | $ 6,161,000 | $ 6,161,000 |
Note 2 - Fresh Start Accounti30
Note 2 - Fresh Start Accounting - Cumulative Impact of Fresh Start Adjustments on APIC (Details) | May 05, 2016USD ($) | |
Cash proceeds from issuance of common stock | $ 7,052,500 | [1],[2] |
Establishment of intangible assets | 10,476,284 | [3] |
Net assets of the predecessor | 359,935 | [4],[5] |
Less par value of common and preferred stock | (753) | [6] |
Cumulative impact of the fresh start adjustments described above on additional paid-in-capital | $ 17,887,966 | [7],[8] |
[1] | Pursuant to the Plan of Reorganization, as of the Effective Date, the Company issued 7,500,000 shares of New Common Stock to certain accredited investors for net cash to the Company of $7,052,500. The Company also issued Warrants to purchase 6,180,000 shares of New Common Stock to certain of the investors. The Warrants terminate on May 5, 2021, and are exercisable at any time on or after November 5, 2016 at exercise prices ranging from $0.50 per share to $1.00 per share. The number of shares of New Common Stock underlying a Warrant and its exercise price are subject to customary adjustments upon subdivisions, combinations, payment of stock dividends, reclassifications, reorganizations and consolidations. Certain investors also provided Backstop Commitments to purchase up to 12,800,000 additional shares of New Common Stock for an aggregate purchase price of up to $3,000,000. The Company closed on issuance of the additional 12,800,000 shares of New Common Stock in August and September 2017. The New Common Stock, Warrants and Backstop Commitment are classified as equity. | |
[2] | Pursuant to the Plan of Reorganization, as of the Effective Date, the Company issued 7,500,000 shares of New Common Stock to certain accredited investors for net cash to the Company of $7,052,500. The Company also issued Warrants to purchase 6,180,000 shares of New Common Stock to certain of the investors. The Warrants terminate on May 5, 2021, and are exercisable at any time on or after November 5, 2016 at exercise prices ranging from $0.50 per share to $1.00 per share. The number of shares of New Common Stock underlying a Warrant and its exercise price are subject to customary adjustments upon subdivisions, combinations, payment of stock dividends, reclassifications, reorganizations and consolidations. Certain investors also provided Backstop Commitments to purchase up to 12,800,000 additional shares of New Common Stock for an aggregate purchase price of up to $3,000,000. The Company closed on issuance of the additional 12,800,000 shares of New Common Stock in August and September 2017. The New Common Stock, Warrants and Backstop Commitment are classified as equity. | |
[3] | Represents identifiable intangible assets of approximately $8.4 million and goodwill of approximately $2.1 million. Upon the application of fresh start accounting, the Company allocated the reorganization value to its individual assets based on their estimated fair values. Reorganization value represents the fair value of the Successor Company's assets before considering liabilities, and the excess of reorganization value over the fair value of identified tangible and intangible assets is reported separately on the consolidated balance sheet as goodwill. The Company, with the assistance of external valuation specialists, estimated the enterprise value of the Company upon emergence from Chapter 11 bankruptcy to be $17.9 million. Enterprise value is defined as the total invested capital, which includes cash and cash equivalents. The estimate is based on a calculation of the present value of the projected future cash flows of the Company from May 5, 2016 through the year ending December 31, 2025, along with a terminal value. The Company estimated a terminal value using the Gordon Growth Model. In applying fresh start accounting, the Company followed these principles: The reorganization value, estimated as approximately $24.0 million, which represents the sum of the enterprise value and estimated fair value of noninterest bearing liabilities, was allocated to the Successor Company's assets based on their estimated fair values. The reorganization value exceeded the sum of the fair value assigned to the assets, and the excess was recognized as goodwill of the Successor Company as of May 5, 2016. Each liability existing as of May 5, 2016 has been stated at its estimated fair value. Deferred tax assets and liabilities have been recognized for differences between the assigned values and the tax basis of the recognized assets and liabilities, and have been fully valued as of May 5, 2016 to reduce deferred tax assets to the amounts expected to be realized. Pursuant to fresh start accounting the Company allocated the determined reorganization value to the Successor Company's assets as follows (in thousands): Enterprise Value $ 17,889 Plus estimated fair value of liabilities 6,161 Reorganization Value 24,050 Less: Estimated fair value of tangible assets (13,574) Estimated fair value of identifiable intangible assets (8,397) Goodwill $2,079 | |
[4] | Reflects the elimination of retained earnings upon the application of fresh start accounting. | |
[5] | Reflects the elimination of retained earnings upon the application of fresh start accounting. | |
[6] | Pursuant to the Plan of Reorganization, on the Effective Date, the Company issued 29,038 shares of Series A Preferred Stock to Deerfield. The Series A Preferred Stock has no stated maturity date, is not convertible or redeemable, and carries a liquidation preference of $29,038,000, which is required to be paid to holders of such Series A Preferred Stock before any payments are made with respect to shares of New Common Stock (and other capital stock that is not issued on parity or senior to the Series A Preferred Stock) upon a liquidation or change in control transaction. The Series A Preferred Stock is carried at par value and is classified as equity. | |
[7] | Reflects the cumulative impact of the fresh start adjustments described above on additional paid-in-capital: Description Adjustment Amount Cash proceeds from issuance of common stock(1) $7,052,500 Establishment of intangible assets (2) 10,476,284 Net assets of the predecessor(5)359,935 Less par value of common and preferred stock (3) (753)Cumulative impact of the fresh start adjustments described above on additional paid-in-capital (4)$17,887,966 | |
[8] | Reflects the cumulative impact of the fresh start adjustments described above on additional paid-in-capital: Description Adjustment Amount Cash proceeds from issuance of common stock(1) $7,052,500 Establishment of intangible assets (2) 10,476,284 Net assets of the predecessor(5)359,935 Less par value of common and preferred stock (3) (753)Cumulative impact of the fresh start adjustments described above on additional paid-in-capital (4)$17,887,966 |
Note 2 - Fresh Start Accounti31
Note 2 - Fresh Start Accounting - Summary of Reorganization Items, Net (Details) - USD ($) | 3 Months Ended | 4 Months Ended | 5 Months Ended | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | May 04, 2016 | Sep. 30, 2016 | Sep. 30, 2017 | |
Professional fees | $ 324,551 | ||||
Net gain on reorganization adjustments | |||||
Reorganization items, net | $ 115,149 | 324,551 | |||
Cash payments for reorganization items | $ 1,507,863 | ||||
Predecessor [Member] | |||||
Professional fees | $ 3,598,216 | ||||
Net gain on reorganization adjustments | (34,869,566) | ||||
Reorganization items, net | (31,271,350) | ||||
Cash payments for reorganization items | $ 1,839,560 |
Note 3 - Liquidity and Summar32
Note 3 - Liquidity and Summary of Significant Accounting Principles (Details Textual) | Aug. 10, 2017USD ($)shares | Sep. 30, 2017USD ($)shares | Jun. 30, 2016shares | Sep. 30, 2017USD ($)shares | Sep. 30, 2016USD ($)shares | May 04, 2016USD ($)shares | Sep. 30, 2016USD ($) | Jun. 30, 2017USD ($) | Sep. 30, 2017USD ($)shares | Sep. 30, 2016USD ($)shares | Dec. 31, 2016USD ($) | May 05, 2016USD ($) | Dec. 31, 2015USD ($) |
Stock Issued During Period, Shares, New Issues | shares | 12,800,000 | 12,800,000 | 12,800,000 | ||||||||||
Proceeds from Issuance of Common Stock | $ 3,000,000 | $ 3,000,000 | |||||||||||
Cash and Cash Equivalents, at Carrying Value | $ 1,923,172 | 1,923,172 | $ 3,878,853 | $ 10,358,209 | $ 3,878,853 | $ 1,923,172 | $ 3,878,853 | $ 2,620,023 | |||||
Cash, Uninsured Amount | 1,700,000 | 1,700,000 | 1,700,000 | ||||||||||
Cash, FDIC Insured Amount | 250,000 | 250,000 | 250,000 | ||||||||||
Allowance for Doubtful Accounts Receivable | 306,000 | 306,000 | 306,000 | 409,000 | |||||||||
Inventory, Finished Goods, Gross | 35,200 | 35,200 | 35,200 | 18,100 | |||||||||
Inventory, Raw Materials, Gross | 36,900 | 36,900 | 36,900 | 59,800 | |||||||||
Inventory Valuation Reserves | 8,000 | $ 8,000 | $ 8,000 | 8,000 | |||||||||
Number of Reporting Units | 1 | ||||||||||||
Percentage of Revenues Generated Outside of United States | 25.00% | 21.00% | 27.00% | 12.00% | |||||||||
Number of Operating Segments | 1 | ||||||||||||
Goodwill, Impairment Loss | $ 2,100,000 | $ 2,079,284 | |||||||||||
Goodwill | $ 0 | $ 0 | 0 | $ 0 | $ 2,079,284 | $ 2,100,000 | $ 0 | ||||||
Goodwill, Carrying Amount Exceeding Fair Value | $ 2,800,000 | ||||||||||||
Fair Value Assumptions, Expected Dividend Rate | 0.00% | ||||||||||||
Predecessor [Member] | |||||||||||||
Cash and Cash Equivalents, at Carrying Value | 10,358,209 | $ 922,317 | |||||||||||
Goodwill, Impairment Loss | |||||||||||||
Employee Stock Option [Member] | |||||||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | shares | 1,111,250 | 1,111,250 | |||||||||||
Employee Stock Option [Member] | Predecessor [Member] | |||||||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | shares | 9,173,119 | ||||||||||||
Warrant [Member] | |||||||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | shares | 6,180,000 | 6,180,000 | 6,180,000 | ||||||||||
Warrant [Member] | Predecessor [Member] | |||||||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | shares | 113,629,178 | ||||||||||||
The 2016 Omnibus Plan [Member] | |||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | shares | 0 | 1,362,500 | 56,250 | 1,362,500 | |||||||||
Minimum [Member] | |||||||||||||
Inventory Shelf Life | 1 year 180 days | ||||||||||||
Property, Plant and Equipment, Useful Life | 1 year | ||||||||||||
Minimum [Member] | Leasehold Improvements [Member] | |||||||||||||
Property, Plant and Equipment, Useful Life | 1 year | ||||||||||||
Maximum [Member] | |||||||||||||
Inventory Shelf Life | 2 years | ||||||||||||
Property, Plant and Equipment, Useful Life | 6 years | ||||||||||||
Maximum [Member] | Leasehold Improvements [Member] | |||||||||||||
Property, Plant and Equipment, Useful Life | 3 years |
Note 3 - Liquidity and Summar33
Note 3 - Liquidity and Summary of Significant Accounting Principles - Summary of Concentration Risk (Details) - Customer Concentration Risk [Member] | 3 Months Ended | 4 Months Ended | 5 Months Ended | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | May 04, 2016 | Sep. 30, 2016 | Sep. 30, 2017 | Dec. 31, 2016 | |
Accounts Receivable [Member] | Customer A [Member] | ||||||
Concentration percentage | 65.00% | 58.00% | ||||
Accounts Receivable [Member] | Customer B [Member] | ||||||
Concentration percentage | 10.00% | |||||
Sales Revenue, Net [Member] | Customer A [Member] | ||||||
Concentration percentage | 25.00% | 21.00% | ||||
Sales Revenue, Net [Member] | Customer A [Member] | Predecessor [Member] | ||||||
Concentration percentage | 78.00% | |||||
Sales Revenue, Net [Member] | Customer B [Member] | ||||||
Concentration percentage | 13.00% | 24.00% | 20.00% | 27.00% | ||
Sales Revenue, Net [Member] | Customer B [Member] | Predecessor [Member] | ||||||
Concentration percentage | ||||||
Sales Revenue, Net [Member] | Customer C [Member] | ||||||
Concentration percentage | 14.00% | 20.00% | 11.00% | |||
Sales Revenue, Net [Member] | Customer C [Member] | Predecessor [Member] | ||||||
Concentration percentage | ||||||
Sales Revenue, Net [Member] | Customer D [Member] | ||||||
Concentration percentage | 11.00% | 11.00% | ||||
Sales Revenue, Net [Member] | Customer D [Member] | Predecessor [Member] | ||||||
Concentration percentage |
Note 3 - Liquidity and Summar34
Note 3 - Liquidity and Summary of Significant Accounting Policies - Summary Stock Option Valuation Assumptions (Details) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2017 | Dec. 31, 2016 | |
Expected stock volatility | 83.00% | 83.00% |
Dividend yield | ||
Minimum [Member] | ||
Risk free rate | 2.00% | 1.80% |
Weighted average expected years until exercise (Year) | 5 years | 4 years 292 days |
Maximum [Member] | ||
Risk free rate | 2.10% | 2.00% |
Weighted average expected years until exercise (Year) | 6 years | 6 years |
Note 3 - Liquidity and Summar35
Note 3 - Liquidity and Summary of Significant Accounting Principles - Earnings (Loss) Per Share (Details) - USD ($) | 3 Months Ended | 4 Months Ended | 5 Months Ended | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | May 04, 2016 | Sep. 30, 2016 | Sep. 30, 2017 | |
Numerator for net loss for basic and diluted loss per share | $ (1,376,899) | $ (1,916,673) | $ (3,211,516) | $ (6,981,560) | |
Denominator for basic and fully diluted loss per share weighted average outstanding common shares (in shares) | 15,852,764 | 9,927,112 | |||
Basic and diluted loss per share | |||||
Basic (in dollars per share) | $ (0.09) | $ (0.19) | $ (0.33) | $ (0.59) | |
Diluted (in dollars per share) | $ (0.09) | $ (0.19) | $ (0.33) | $ (0.59) | |
Numerator for basic income (loss) per share | $ (3,211,516) | $ (6,981,560) | |||
Numerator adjustments for potential dilutive securities | |||||
Numerator for diluted income (loss) per share | $ (3,211,516) | $ (6,981,560) | |||
Denominator for basic income (loss) per share weighted average outstanding common shares (in shares) | 15,852,764 | 9,927,112 | 9,876,605 | 11,924,035 | |
Dilutive effect of convertible debt (in shares) | 0 | ||||
Denominator for diluted income (loss) per share (in shares) | 15,852,764 | 9,927,112 | 9,876,605 | 11,924,035 | |
Predecessor [Member] | |||||
Numerator for net loss for basic and diluted loss per share | $ 28,173,934 | ||||
Basic and diluted loss per share | |||||
Basic (in dollars per share) | $ 0.22 | ||||
Diluted (in dollars per share) | $ 0.15 | ||||
Numerator for basic income (loss) per share | $ 28,173,934 | ||||
Numerator adjustments for potential dilutive securities | 172,546 | ||||
Numerator for diluted income (loss) per share | $ 28,346,480 | ||||
Denominator for basic income (loss) per share weighted average outstanding common shares (in shares) | 125,951,100 | ||||
Dilutive effect of convertible debt (in shares) | 67,307,692 | ||||
Denominator for diluted income (loss) per share (in shares) | 193,258,792 |
Note 4 - Distribution, Licens36
Note 4 - Distribution, Licensing and Collaboration Arrangements (Details Textual) | Oct. 31, 2016USD ($) | Oct. 28, 2016USD ($) | May 05, 2016USD ($)$ / item | Mar. 22, 2016USD ($) | Dec. 31, 2016USD ($) | Nov. 30, 2016USD ($) | Jan. 31, 2015USD ($) | Dec. 31, 2013USD ($) |
Repayments of Related Party Debt | $ 201,200 | |||||||
Debt Instrument, Number of Periodic Payments | 3 | |||||||
Debt Instrument, Periodic Payment | $ 33,333 | |||||||
Distribution Agreement with Boyalife [Member] | Affiliated Entity [Member] | ||||||||
Due from Related Parties, Current | $ 500,000 | |||||||
Maximum Payment on Right Excercisable | $ 250,000 | |||||||
License Agreement, Original Term | 5 years | |||||||
Distribution Agreement with Boyalife [Member] | Affiliated Entity [Member] | Aurix System [Member] | ||||||||
Distribution Fee per Unit Sold | $ / item | 40 | |||||||
Restorix Distribution Agreement [Member] | ||||||||
Collaboration Agreement, Term | 2 years | |||||||
Restorix Distribution Agreement [Member] | Minimum [Member] | ||||||||
Collaboration Agreement, Available Extension of Term | 1 | |||||||
Current Product Price | $ 700 | |||||||
Restorix Distribution Agreement [Member] | Maximum [Member] | ||||||||
Current Product Price | $ 750 | |||||||
Arthrex and Deerfield SS, LLC [Member] | ||||||||
Proceeds from License Fees Received | $ 33,333 | $ 33,333 | $ 33,333 | |||||
Arthrex [Member] | ||||||||
Debt Instrument, Increase (Decrease), Net | $ 15,000,000 | |||||||
Rohto Pharmaceutical Co., Ltd [Member] | ||||||||
Proceeds from License Fees Received | $ 3,000,000 | |||||||
Millennia Holdings, Inc [Member] | ||||||||
Payments for Terminated Licenses | $ 1,500,000 | |||||||
Distributor and License Agreement with Arthrex [Member] | ||||||||
License Agreement, Additional Term | 3 years | |||||||
License Agreement, Minimum Required Period from End of Original Term to Terminate Term Extension | 1 year | |||||||
Advance Royalties | $ 5,000,000 | |||||||
License Agreement, Original Term | 5 years |
Note 5 - Receivables - Accounts
Note 5 - Receivables - Accounts and Other Receivable, Net (Details) - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 |
Accounts receivable, gross | $ 469,524 | $ 703,675 |
Less allowance for doubtful accounts | (305,896) | (409,377) |
Accounts and other receivable, net | 163,628 | 294,298 |
Trade Accounts Receivable [Member] | ||
Accounts receivable, gross | 116,802 | 100,660 |
Other Receivables [Member] | ||
Accounts receivable, gross | $ 352,722 | $ 603,015 |
Note 6 - Property and Equipme38
Note 6 - Property and Equipment (Details Textual) - USD ($) | 3 Months Ended | 4 Months Ended | 5 Months Ended | 9 Months Ended |
Sep. 30, 2017 | May 04, 2016 | Sep. 30, 2016 | Sep. 30, 2017 | |
Depreciation, Depletion and Amortization, Nonproduction | $ 51,000 | $ 175,000 | $ 230,000 | |
Predecessor [Member] | ||||
Depreciation, Depletion and Amortization, Nonproduction | $ 182,000 |
Note 6 - Property and Equipme39
Note 6 - Property and Equipment - Property and Equipment, Net (Details) - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 |
Property, plant, and equipment, gross | $ 762,855 | $ 765,717 |
Less accumulated depreciation and amortization | (506,968) | (279,601) |
Property and equipment, net | 255,887 | 486,116 |
Medical Equipment [Member] | ||
Property, plant, and equipment, gross | 402,234 | 405,096 |
Office Equipment [Member] | ||
Property, plant, and equipment, gross | 48,888 | 48,888 |
Technology Equipment [Member] | ||
Property, plant, and equipment, gross | 257,619 | 257,619 |
Manufacturing Equipment [Member] | ||
Property, plant, and equipment, gross | 34,899 | 34,899 |
Leasehold Improvements [Member] | ||
Property, plant, and equipment, gross | $ 19,215 | $ 19,215 |
Note 7 - Goodwill and Other I40
Note 7 - Goodwill and Other Intangible Assets (Details Textual) - USD ($) | 1 Months Ended | 4 Months Ended | 5 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||
May 04, 2016 | May 04, 2016 | Sep. 30, 2016 | Jun. 30, 2017 | Sep. 30, 2017 | Dec. 31, 2016 | May 05, 2016 | Dec. 31, 2015 | |
Goodwill, Carrying Amount Exceeding Fair Value | $ 2,800,000 | |||||||
Goodwill, Impairment Loss | 2,100,000 | $ 2,079,284 | ||||||
Goodwill | $ 0 | 0 | $ 2,079,284 | $ 2,100,000 | $ 0 | |||
Amortization of Intangible Assets | 639,000 | |||||||
Cost of Goods Sold, Amortization | $ 548,000 | |||||||
Predecessor [Member] | ||||||||
Goodwill, Impairment Loss | ||||||||
Amortization of Intangible Assets | $ 20,000 | $ 90,000 | ||||||
Minimum [Member] | ||||||||
Finite-Lived Intangible Asset, Useful Life | 9 years | |||||||
Minimum [Member] | Predecessor [Member] | ||||||||
Finite-Lived Intangible Asset, Useful Life | 8 years | |||||||
Maximum [Member] | ||||||||
Finite-Lived Intangible Asset, Useful Life | 15 years | |||||||
Maximum [Member] | Predecessor [Member] | ||||||||
Finite-Lived Intangible Asset, Useful Life | 20 years |
Note 7 - Goodwill and Other I41
Note 7 - Goodwill and Other Intangible Assets - Intangible Assets (Details) - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 |
Finite-lived intangible assets, gross | $ 8,397,000 | $ 8,397,000 |
Accumulated amortization | (1,195,642) | (556,592) |
Finite-lived intangible assets, net | 7,201,358 | 7,840,408 |
Trademarks [Member] | ||
Finite-lived intangible assets, gross | 917,000 | 917,000 |
Accumulated amortization | (85,784) | (39,934) |
Technology-Based Intangible Assets [Member] | ||
Finite-lived intangible assets, gross | 6,576,000 | 6,576,000 |
Accumulated amortization | (1,025,290) | (477,290) |
Customer Relationships [Member] | ||
Finite-lived intangible assets, gross | 904,000 | 904,000 |
Accumulated amortization | $ (84,568) | $ (39,368) |
Note 7 - Goodwill and Other I42
Note 7 - Goodwill and Other Intangible Assets - Changes in Goodwill (Details) - USD ($) | 5 Months Ended | 6 Months Ended | 9 Months Ended | ||||
Sep. 30, 2016 | Jun. 30, 2017 | Sep. 30, 2017 | Dec. 31, 2016 | May 05, 2016 | Dec. 31, 2015 | ||
Goodwill | $ 0 | $ 0 | $ 2,079,284 | $ 2,100,000 | $ 0 | ||
Fresh start accounting | $ 2,079,284 | $ 2,079,284 | [1] | ||||
Balance | 2,079,284 | 2,079,284 | |||||
Impairment of goodwill | (2,100,000) | (2,079,284) | |||||
Balance | $ 0 | $ 0 | |||||
[1] | Represents identifiable intangible assets of approximately $8.4 million and goodwill of approximately $2.1 million. Upon the application of fresh start accounting, the Company allocated the reorganization value to its individual assets based on their estimated fair values. Reorganization value represents the fair value of the Successor Company's assets before considering liabilities, and the excess of reorganization value over the fair value of identified tangible and intangible assets is reported separately on the consolidated balance sheet as goodwill. The Company, with the assistance of external valuation specialists, estimated the enterprise value of the Company upon emergence from Chapter 11 bankruptcy to be $17.9 million. Enterprise value is defined as the total invested capital, which includes cash and cash equivalents. The estimate is based on a calculation of the present value of the projected future cash flows of the Company from May 5, 2016 through the year ending December 31, 2025, along with a terminal value. The Company estimated a terminal value using the Gordon Growth Model. In applying fresh start accounting, the Company followed these principles: The reorganization value, estimated as approximately $24.0 million, which represents the sum of the enterprise value and estimated fair value of noninterest bearing liabilities, was allocated to the Successor Company's assets based on their estimated fair values. The reorganization value exceeded the sum of the fair value assigned to the assets, and the excess was recognized as goodwill of the Successor Company as of May 5, 2016. Each liability existing as of May 5, 2016 has been stated at its estimated fair value. Deferred tax assets and liabilities have been recognized for differences between the assigned values and the tax basis of the recognized assets and liabilities, and have been fully valued as of May 5, 2016 to reduce deferred tax assets to the amounts expected to be realized. Pursuant to fresh start accounting the Company allocated the determined reorganization value to the Successor Company's assets as follows (in thousands): Enterprise Value $ 17,889 Plus estimated fair value of liabilities 6,161 Reorganization Value 24,050 Less: Estimated fair value of tangible assets (13,574) Estimated fair value of identifiable intangible assets (8,397) Goodwill $2,079 |
Note 7 - Goodwill and Other I43
Note 7 - Goodwill and Other Intangible Assets - Annual Amortization Expense (Details) | Sep. 30, 2017USD ($) |
2017 (Fourth quarter 2017) | $ 213,000 |
2,018 | 852,000 |
2,019 | 852,000 |
2,020 | 852,000 |
2,021 | 852,000 |
Thereafter | $ 3,580,000 |
Note 8 - Debt (Details Textual)
Note 8 - Debt (Details Textual) - USD ($) | Aug. 10, 2017 | May 05, 2016 | Jan. 28, 2016 | Jan. 26, 2016 | Sep. 30, 2017 | Sep. 30, 2017 | May 04, 2016 | Sep. 30, 2017 | Dec. 31, 2014 | Mar. 09, 2016 |
Debt, Long-term and Short-term, Combined Amount | $ 0 | $ 0 | $ 0 | |||||||
Stock Issued During Period, Shares, New Issues | 12,800,000 | 12,800,000 | 12,800,000 | |||||||
Interest Expense, Debt | $ 5,400 | $ 253,000 | $ 14,200 | |||||||
Series A Preferred Stock [Member] | ||||||||||
Stock Issued During Period, Shares, New Issues | 29,038 | |||||||||
Deerfield Facility Agreement [Member] | ||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 35,000,000 | |||||||||
Debt Instrument, Term | 5 years | |||||||||
Debt, Current | $ 38,300,000 | |||||||||
Interest Expense, Debt | 173,000 | |||||||||
Deerfield Facility Agreement [Member] | Series A Preferred Stock [Member] | ||||||||||
Stock Issued During Period, Shares, New Issues | 29,038 | |||||||||
DIP Credit Agreement [Member] | ||||||||||
Debt, Current | $ 5,750,000 | |||||||||
DIP Loans [Member] | ||||||||||
Proceeds from Issuance of Debt | 5,750,000 | |||||||||
Debt Instrument, Fee Amount | 300,000 | |||||||||
Interest Expense, Debt | $ 79,000 | |||||||||
DIP Loans [Member] | Predecessor [Member] | ||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 6,000,000 | |||||||||
Percentage of Lenders of Existing Debt | 100.00% |
Note 9 - Equity and Stock-bas45
Note 9 - Equity and Stock-based Compensation (Details Textual) | Aug. 10, 2017USD ($)shares | Jun. 20, 2016USD ($)shares | May 05, 2016USD ($)$ / sharesshares | May 04, 2016$ / shares | Sep. 30, 2017USD ($)$ / sharesshares | Sep. 30, 2017USD ($)$ / sharesshares | Jun. 30, 2016shares | Sep. 30, 2017USD ($)$ / sharesshares | Dec. 31, 2016USD ($)$ / sharesshares | Aug. 04, 2016shares | Jun. 09, 2014shares |
Authorized Shares, Common and Preferred | 32,500,000 | 32,500,000 | 32,500,000 | ||||||||
Common Stock, Shares Authorized | 31,500,000 | 31,500,000 | 31,500,000 | 31,500,000 | |||||||
Preferred Stock, Shares Authorized | 1,000,000 | 1,000,000 | 1,000,000 | 1,000,000 | |||||||
Preferred Stock, Par or Stated Value Per Share | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.001 | |||||||
Stock Issued During Period, Shares, New Issues | 12,800,000 | 12,800,000 | 12,800,000 | ||||||||
Proceeds from Issuance of Common Stock | $ | $ 3,000,000 | $ 3,000,000 | |||||||||
Payment for Offering Cost | $ | $ 100,000 | ||||||||||
Common Stock, Par or Stated Value Per Share | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.001 | ||||||
Preferred Stock, Liquidation Preference, Value | $ | $ 29,038,000 | $ 29,038,000 | $ 29,038,000 | $ 29,038,000 | |||||||
Long Term Incentive Plan [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 10,500,000 | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 0 | ||||||||||
Long Term Incentive Plan [Member] | Employee Stock Option [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period | 10 years | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 4 years | ||||||||||
Equity Incentive Plan [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 18,000,000 | ||||||||||
The 2016 Omnibus Plan [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 1,590,000 | 1,590,000 | 1,590,000 | 1,500,000 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 0 | ||||||||||
Evergreen Provision, Increase in Number of Shares Authorized Calculation, Percentage Amount of Prior Year's Reserved Shares | 6.00% | ||||||||||
Evergreen Provision, Maximum Limit of Increase to Authorized Shares | 1,000,000 | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 0 | 56,250 | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Granted in Period, Fair Value | $ | $ 8,500 | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value | $ | 31,200 | ||||||||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized | $ | $ 75,500 | $ 75,500 | $ 75,500 | ||||||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 328 days | ||||||||||
Series A Preferred Stock [Member] | |||||||||||
Preferred Stock, Shares Authorized | 29,038 | ||||||||||
Preferred Stock, Par or Stated Value Per Share | $ / shares | $ 0.0001 | ||||||||||
Stock Issued During Period, Shares, New Issues | 29,038 | ||||||||||
Common Stock, Par or Stated Value Per Share | $ / shares | $ 0.0001 | ||||||||||
Preferred Stock, Liquidation Preference, Value | $ | $ 29,038,000 | ||||||||||
Preferred Stock, Voting Rights, Number of Votes Per Share | 5 | ||||||||||
Preferred Stock, Voting Rights, Percentage of Voting Rights of Capital Stock | 1.00% | ||||||||||
Preferred Stock, Restrictions, Debt Ceiling Other Than for Working Capital Purposes | $ | $ 3,000,000 | ||||||||||
Maximum [Member] | Series A Preferred Stock [Member] | |||||||||||
Preferred Stock, Voting Rights, Percentage of Voting Rights of Capital Stock | 1.00% | ||||||||||
Common Stock [Member] | |||||||||||
Stock Issued During Period, Shares, New Issues | 7,500,000 | ||||||||||
Proceeds from Issuance of Common Stock | $ | $ 7,300,000 | ||||||||||
Proceeds from Issuance of Common Stock, Net of Issuance Costs | $ | 7,052,500 | ||||||||||
Payment for Offering Cost | $ | $ 100,000 | ||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 6,180,000 | ||||||||||
Common Stock, Par or Stated Value Per Share | $ / shares | $ 0.0001 | ||||||||||
Common Stock [Member] | Minimum [Member] | |||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | 0.50 | ||||||||||
Common Stock [Member] | Maximum [Member] | |||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 1 | ||||||||||
Common Stock [Member] | Backstop Commitment [Member] | |||||||||||
Number of Shares Commited to Purchase | 12,800,000 | ||||||||||
Value of Shares Commited to Purchase | $ | $ 3,000,000 | ||||||||||
Exchange Shares [Member] | |||||||||||
Stock Issued During Period, Shares, New Issues | 2,264,612 | ||||||||||
Number of Shares Commited to Issue | 3,000,000 | ||||||||||
Shares of Old Common Stock to New Common Stock, Conversion Ratio | 41.8934 | ||||||||||
Administrative Claim Shares [Member] | |||||||||||
Stock Issued During Period, Shares, New Issues | 162,500 | ||||||||||
Stock Issued During Period, Shares, Issued for Services | 100,000 | ||||||||||
Debt Conversion, Converted Instrument, Shares Issued | 62,500 | ||||||||||
Debt Conversion, Original Debt, Amount | $ | $ 62,500 |
Note 9 - Equity and Share-based
Note 9 - Equity and Share-based Compensation - Stock Options, Activity (Details) - Long Term Incentive and Equity Incentive Plans [Member] | 9 Months Ended | 12 Months Ended |
Sep. 30, 2017$ / sharesshares | Dec. 31, 2016$ / sharesshares | |
Outstanding at December 31, 2016 (in shares) | shares | 1,265,000 | |
Outstanding at December 31, 2016 (in dollars per share) | $ / shares | $ 1 | |
Outstanding at December 31, 2016 (Year) | 8 years 138 days | 9 years 186 days |
Shares granted (in shares) | shares | 56,250 | |
Shares granted, weighted-average exercise price (in dollars per share) | $ / shares | $ 1.67 | |
Shares granted, weighted-average remaining contractual term (Year) | 9 years 193 days | |
Shares exercised (in shares) | shares | ||
Shares exercised, weighted-average exercise price (in dollars per share) | $ / shares | ||
Shares forfeited or expired (in shares) | shares | (210,000) | |
Shares forfeited or expired, weighted-average exercise price (in dollars per share) | $ / shares | ||
Shares outstanding (in shares) | shares | 1,111,250 | 1,265,000 |
Shares outstanding, weighted-average exercise price (in dollars per share) | $ / shares | $ 1.03 | $ 1 |
Shares exercisable (in shares) | shares | 491,248 | |
Shares exercisable, weighted-average exercise price (in dollars per share) | $ / shares | $ 1 | |
Shares exercisable, weighted-average remaining contractual term (Year) | 7 years 306 days | |
Shares vested & expected to vest (in shares) | shares | 1,111,250 | |
Shares vested & expected to vest, weighted-average exercise price (in dollars per share) | $ / shares | $ 1.03 | |
Shares vested & expected to vest, weighted-average remaining contractual term (Year) | 8 years 138 days |
Note 9 - Equity and Stock-bas47
Note 9 - Equity and Stock-based Compensation - Stock-based Compensation Expense (Details) - USD ($) | 3 Months Ended | 4 Months Ended | 5 Months Ended | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | May 04, 2016 | Sep. 30, 2016 | Sep. 30, 2017 | |
Share-based compensation | $ 14,335 | $ 42,306 | |||
Predecessor [Member] | |||||
Share-based compensation | $ 55,081 | ||||
Selling and Marketing Expense [Member] | |||||
Share-based compensation | 1,392 | 3,906 | |||
Selling and Marketing Expense [Member] | Predecessor [Member] | |||||
Share-based compensation | 18,504 | ||||
Research and Development Expense [Member] | |||||
Share-based compensation | 2,978 | 9,201 | |||
Research and Development Expense [Member] | Predecessor [Member] | |||||
Share-based compensation | 6,858 | ||||
General and Administrative Expense [Member] | |||||
Share-based compensation | $ 9,965 | $ 29,199 | |||
General and Administrative Expense [Member] | Predecessor [Member] | |||||
Share-based compensation | $ 29,719 |
Note 10 - Fair Value Measurem48
Note 10 - Fair Value Measurements (Details Textual) - USD ($) | 5 Months Ended | 6 Months Ended | 9 Months Ended | |||
Sep. 30, 2016 | Jun. 30, 2017 | Sep. 30, 2017 | Dec. 31, 2016 | May 05, 2016 | Dec. 31, 2015 | |
Goodwill, Impairment Loss | $ 2,100,000 | $ 2,079,284 | ||||
Goodwill | $ 0 | 0 | $ 2,079,284 | $ 2,100,000 | $ 0 | |
Fair Value, Measurements, Recurring [Member] | ||||||
Assets, Fair Value Disclosure | 0 | 0 | ||||
Financial Liabilities Fair Value Disclosure | 0 | 0 | ||||
Fair Value, Measurements, Nonrecurring [Member] | ||||||
Assets, Fair Value Disclosure | 0 | 0 | ||||
Financial Liabilities Fair Value Disclosure | $ 0 | $ 0 |
Note 11 - Commitments and Con49
Note 11 - Commitments and Contingencies (Details Textual) | 9 Months Ended |
Sep. 30, 2017USD ($)ft² | |
Office and Warehouse Facilities in Gaithersburg, Maryland Leases [Member] | |
Operating Leases, Area | ft² | 12,000 |
Operating Leases of Lessee, Number of Operating Leases | 2 |
Operating Leases, Monthly Rent Expense | $ 18,700 |
Commercial Operation Facility in Nashville, Tennessee [Member] | |
Operating Leases, Area | ft² | 2,100 |
Operating Leases, Monthly Rent Expense | $ 4,200 |
Facility in Durham, North Carolina [Member] | |
Operating Leases, Area | ft² | 16,300 |
Operating Leases, Monthly Rent Expense | $ 22,100 |
Sublease of Facility in Durham, North Carolina [Member] | |
Operating Leases, Monthly Rent Expense | $ 14,600 |