Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2021 | May 03, 2021 | |
Cover [Abstract] | ||
Entity Registrant Name | ALPHATEC HOLDINGS, INC. | |
Entity Central Index Key | 0001350653 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Document Type | 10-Q | |
Trading Symbol | ATEC | |
Document Period End Date | Mar. 31, 2021 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus (Q1,Q2,Q3,FY) | Q1 | |
Entity Current Reporting Status | Yes | |
Amendment Flag | false | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 97,466,043 | |
Entity Shell Company | false | |
Entity File Number | 000-52024 | |
Entity Tax Identification Number | 20-2463898 | |
Entity Address, Address Line One | 1950 Camino Vida Roble | |
Entity Address, City or Town | Carlsbad | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 92008 | |
City Area Code | 760 | |
Local Phone Number | 431-9286 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Incorporation, State or Country Code | DE | |
Entity Interactive Data Current | Yes | |
Title of 12(b) Security | Common stock, par value $.0001 per share | |
Security Exchange Name | NASDAQ |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash | $ 191,137 | $ 107,765 |
Accounts receivable, net | 25,751 | 23,527 |
Inventories, net | 57,376 | 46,001 |
Prepaid expenses and other current assets | 3,433 | 5,439 |
Withholding tax receivable from Officer | 1,076 | 1,076 |
Current assets of discontinued operations | 348 | 352 |
Total current assets | 279,121 | 184,160 |
Property and equipment, net | 56,124 | 36,670 |
Right-of-use asset | 21,704 | 1,177 |
Goodwill | 13,897 | 13,897 |
Intangible assets, net | 24,129 | 24,720 |
Debt securities | 1,313 | |
Equity securities | 7,619 | |
Other assets | 541 | 541 |
Noncurrent assets of discontinued operations | 55 | 58 |
Total assets | 404,503 | 261,223 |
Current liabilities: | ||
Accounts payable | 26,416 | 17,599 |
Accrued expenses | 36,730 | 35,231 |
Current portion of long-term debt | 5,374 | 4,200 |
Current portion of operating lease liability | 1,486 | 885 |
Current liabilities of discontinued operations | 143 | 397 |
Total current liabilities | 70,149 | 58,312 |
Long-term debt, less current portion | 38,580 | 38,034 |
Operating lease liability, less current portion | 20,752 | 41 |
Other long-term liabilities | 11,289 | 11,353 |
Commitments and contingencies (Note 6) | ||
Stockholders' equity: | ||
Common stock, $0.0001 par value; 200,000 authorized; 84,737 shares issued and 84,571 shares outstanding at March 31, 2021, net of 166 unvested shares; and 82,294 shares issued and 82,104 shares outstanding, net of 190 unvested shares at December 31, 2020 | 8 | 8 |
Treasury stock, 2 shares, at cost | (97) | (97) |
Additional paid-in capital | 774,031 | 770,764 |
Shareholder note receivable | (2,900) | (4,000) |
Accumulated other comprehensive income | (1,848) | 1,204 |
Accumulated deficit | (660,902) | (637,999) |
Total stockholders’ equity | 108,292 | 129,880 |
Total liabilities and stockholders’ equity | 404,503 | 261,223 |
Redeemable Preferred Stock | ||
Current liabilities: | ||
Redeemable preferred and contingently redeemable common stock | 23,603 | $ 23,603 |
Contingently Redeemable Common Stock | ||
Current liabilities: | ||
Redeemable preferred and contingently redeemable common stock | $ 131,838 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares | Mar. 31, 2021 | Dec. 31, 2020 |
Common stock, par value (dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, shares issued | 84,737,000 | 82,294,000 |
Common stock, shares outstanding | 84,571,000 | 82,104,000 |
Common stock, unvested shares | 166,000 | 190,000 |
Treasury stock, shares | 2,000 | 2,000 |
Redeemable Preferred Stock | ||
Redeemable preferred stock and contingently redeemable common stock, par value (dollars per share) | $ 0.0001 | $ 0.0001 |
Redeemable preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Redeemable preferred stock and contingently redeemable common stock, shares issued | 3,319,000 | 3,319,000 |
Redeemable preferred stock and contingently redeemable common stock, shares outstanding | 3,319,000 | 3,319,000 |
Contingently Redeemable Common Stock | ||
Redeemable preferred stock and contingently redeemable common stock, par value (dollars per share) | $ 0.0001 | $ 0.0001 |
Redeemable preferred stock and contingently redeemable common stock, shares issued | 12,421,000 | 0 |
Redeemable preferred stock and contingently redeemable common stock, shares outstanding | 12,421,000 | 0 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Revenue: | ||
Revenue | $ 44,121 | $ 30,115 |
Cost of revenue | 12,263 | 9,084 |
Gross profit | 31,858 | 21,031 |
Operating expenses: | ||
Research and development | 5,801 | 4,170 |
Sales, general and administrative | 40,426 | 27,582 |
Litigation-related | 3,335 | 2,643 |
Amortization of acquired intangible assets | 172 | 172 |
Transaction-related | 1,012 | 4,272 |
Restructuring | 158 | |
Total operating expenses | 50,904 | 38,839 |
Operating loss | (19,046) | (17,808) |
Interest and other expense, net: | ||
Interest expense, net | (1,938) | (2,874) |
Other expenses | (1,889) | |
Total interest and other expense, net | (3,827) | (2,874) |
Loss from continuing operations before taxes | (22,873) | (20,682) |
Income tax provision | 30 | 40 |
Loss from continuing operations | (22,903) | (20,722) |
Net loss | $ (22,903) | $ (20,722) |
Net loss per share, basic and diluted | ||
Shares used in calculating basic and diluted net loss per share | 87,223 | 62,568 |
United States Product | ||
Revenue: | ||
Revenue | $ 43,716 | $ 29,070 |
International Supply Agreement | ||
Revenue: | ||
Revenue | $ 405 | $ 1,045 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Statement Of Income And Comprehensive Income [Abstract] | ||
Net loss | $ (22,903) | $ (20,722) |
Foreign currency translation adjustments related to continuing operations | (3,052) | 69 |
Comprehensive loss | $ (25,955) | $ (20,653) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) - USD ($) shares in Thousands, $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment | Common Stock | Additional paid-in capital | Shareholder note receivable | Treasury stock | Accumulated other comprehensive income (loss) | Accumulated deficit | Accumulated deficitCumulative Effect, Period of Adoption, Adjustment |
Balance at Dec. 31, 2019 | $ 43,631 | $ (81) | $ 6 | $ 606,558 | $ (5,000) | $ (97) | $ 1,088 | $ (558,924) | $ (81) |
Balance, shares at Dec. 31, 2019 | 61,400 | ||||||||
Accounting Standards Update Extensible List | us-gaap:AccountingStandardsUpdate201908Member | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Stock-based compensation | $ 3,630 | 3,630 | |||||||
Distributor equity incentives | 70 | 70 | |||||||
Common stock issued for warrant exercises | 1,158 | 1,158 | |||||||
Common stock issued for warrant exercises, shares | 1,390 | ||||||||
Common stock issued for stock option exercises | 83 | 83 | |||||||
Common stock issued for stock option exercises, shares | 76 | ||||||||
Common stock issued for vesting of restricted stock awards, net of shares repurchased for tax liability | (408) | (408) | |||||||
Common stock issued for vesting of restricted stock awards, net of shares repurchased for tax liability, shares | 394 | ||||||||
Foreign currency translation adjustments | 69 | 69 | |||||||
Net loss | (20,722) | (20,722) | |||||||
Balance at Mar. 31, 2020 | 27,430 | $ 6 | 611,091 | (5,000) | (97) | 1,157 | (579,727) | ||
Balance, shares at Mar. 31, 2020 | 63,260 | ||||||||
Balance at Dec. 31, 2020 | 129,880 | $ 8 | 770,764 | (4,000) | (97) | 1,204 | (637,999) | ||
Balance, shares at Dec. 31, 2020 | 82,104 | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Stock-based compensation | 3,889 | 3,889 | |||||||
Distributor equity incentives | 129 | 129 | |||||||
Common stock issued for warrant exercises | 756 | 756 | |||||||
Common stock issued for warrant exercises, shares | 2,019 | ||||||||
Common stock issued for employee stock purchase plan and stock option exercises | 210 | 210 | |||||||
Common stock issued for employee stock purchase plan and stock option exercises, shares | 69 | ||||||||
Common stock issued for vesting of restricted stock awards, net of shares repurchased for tax liability | (1,717) | (1,717) | |||||||
Common stock issued for vesting of restricted stock awards, net of shares repurchased for tax liability, shares | 379 | ||||||||
Shareholder Note Receivable | 1,100 | 1,100 | |||||||
Foreign currency translation adjustments | (3,052) | (3,052) | |||||||
Net loss | (22,903) | (22,903) | |||||||
Balance at Mar. 31, 2021 | $ 108,292 | $ 8 | $ 774,031 | $ (2,900) | $ (97) | $ (1,848) | $ (660,902) | ||
Balance, shares at Mar. 31, 2021 | 84,571 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Operating activities: | ||
Net loss | $ (22,903) | $ (20,722) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 3,850 | 2,454 |
Stock-based compensation | 4,474 | 3,568 |
Amortization of debt discount and debt issuance costs | 640 | 1,238 |
Amortization of right-of-use assets | 1,022 | 259 |
Provision for doubtful accounts | (5) | |
Provision for excess and obsolete inventory | 2,096 | 1,722 |
Loss on disposal of instruments | 369 | 32 |
Loss on impairment of intangible asset | 150 | |
Loss on fair value investments | 149 | |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | (1,891) | 782 |
Inventories, net | (13,471) | (4,741) |
Prepaid expenses and other current assets | 1,367 | (983) |
Accounts payable | 2,160 | (2,643) |
Accrued expenses and other current liabilities | 2,958 | 3,414 |
Lease liability | 31 | (324) |
Other long-term liabilities | 395 | (1,099) |
Net cash used in operating activities | (18,604) | (17,048) |
Investing activities: | ||
Purchases of property and equipment | (15,202) | (2,629) |
Cash paid for investment in EOS | (9,081) | |
Loss on forward contract settlement | (1,711) | |
Net cash used in investing activities | (25,994) | (2,629) |
Financing activities: | ||
Proceeds from public offering | 131,838 | |
Net cash (paid) received from common stock exercises | (1,048) | 833 |
Borrowings under lines of credit | 29,544 | |
Repayments under lines of credit | (30,408) | |
Principal payments on capital lease obligations | (14) | (8) |
Net cash provided by (used in) financing activities | 130,776 | (39) |
Effect of exchange rate changes on cash | (2,806) | 69 |
Net increase (decrease) in cash | 83,372 | (19,647) |
Cash at beginning of period, including discontinued operations | 107,765 | 47,113 |
Cash at end of period, including discontinued operations | 191,137 | 27,466 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | 1,783 | 1,646 |
Cash paid for income taxes | 21 | 25 |
Supplemental disclosure of noncash investing activities: | ||
Purchases of property and equipment in accounts payable | 8,030 | $ 1,297 |
Recognition of right-of-use asset | 21,570 | |
Recognition of lease liability | $ 21,505 |
The Company and Basis of Presen
The Company and Basis of Presentation | 3 Months Ended |
Mar. 31, 2021 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
The Company and Basis of Presentation | 1. The Company and Basis of Presentation The Company Alphatec Holdings, Inc. (the “Company”), through its wholly owned subsidiaries, Alphatec Spine, Inc. (“Alphatec Spine”) and SafeOp Surgical, Inc. (“SafeOp”), is a medical technology company that designs, develops, and markets technology for the treatment of spinal disorders associated with disease and degeneration, congenital deformities, and trauma. The Company markets its products in the U.S. via independent sales agents and a direct sales force. On September 1, 2016, the Company completed the sale of its international distribution operations and agreements (collectively, the “International Business”) to Globus Medical Ireland, Ltd., a subsidiary of Globus Medical, Inc., and its affiliated entities (collectively “Globus”). As a result of this transaction, the International Business has been excluded from continuing operations for all periods presented in the condensed consolidated financial statements and is reported as discontinued operations. See Note 4 for additional information on the divestiture of the International Business. Recent Developments Acquisition of EOS On December 16, 2020, the Company, entered into a Tender Offer Agreement (the “Tender Offer Agreement”) with EOS imaging S.A., a société anonyme organized and existing under the laws of France (“EOS”), pursuant to which the Company commenced a public tender offer (the “Offer”) to purchase all of the issued and outstanding ordinary shares, nominal value €0.01 per share (collectively, the “EOS Shares”), and outstanding convertible bonds (“OCEANEs”), of EOS. The Offer consists of a cash tender offer price of €2.45 (or approximately $2.99) per EOS Share and €7.01 (or approximately $8.55) per OCEANE (the “Offer Consideration”), for a total purchase price of up to $116.9 million. On March 2, 2021, the Company transferred $115.3 million (approximately €95.6 million) to an escrow account to fund the Offer. The Offer was filed with the Autorité des marches financiers (the “AMF”) on March 5, 2021 and cleared by the AMF on March 30, 2021. The opening of the Offer occurred on April 1, 2021. Certain shareholders of EOS, which currently control approximately 23% of the outstanding EOS Shares, collectively, have entered into Tender Commitments with the Company pursuant to which they have agreed, among other things, to tender their respective EOS Shares into the Offer, subject to certain conditions. These Tender Commitments will terminate if (i) the Tender Offer Agreement is terminated, (ii) the Offer is withdrawn by the Company pursuant to applicable French laws and regulations, or (iii) the Offer is not declared successful by the AMF as a result of certain conditions failing to be met or waived. Basis of Presentation The accompanying condensed consolidated balance sheet as of December 31, 2020, which has been derived from audited financial statements, and the unaudited interim condensed consolidated financial statements for the period ended March 31, 2021 have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”) pertaining to a quarterly report on Form 10-Q. Certain information and note disclosures normally included in annual audited financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to the interim-period-reporting provisions of U.S. GAAP and the SEC. The Company believes that the disclosures made in this Quarterly Report on Form 10-Q are adequate to make the information not misleading. The unaudited interim condensed consolidated financial statements reflect all adjustments, including normal recurring adjustments which, in the opinion of management, are necessary for a fair statement of the financial position and results of operations for the periods presented. These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, 2020, which are included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020 that was filed with the SEC on March 5, 2021. Operating results for the three months ended March 31, 2021 are not necessarily indicative of the results that may be expected for the year ending December 31, 2021, or any other future periods. Reclassification Certain amounts in the condensed consolidated financial statements for the three months ended March 31, 2020 have been reclassified to conform to the current period’s presentation. These reclassifications were immaterial and had no impact on previously reported results of operations or accumulated deficit. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies The Company’s significant accounting policies are described in Note 2 to its audited consolidated financial statements for the year ended December 31, 2020, which are included in the Company’s Annual Report on Form 10-K that was filed with the SEC on March 5, 2021. Except as discussed below, these accounting policies have not changed during the three months ended March 31, 2021. Fair Value Measurements T he carrying amount of financial instruments consisting of cash, trade accounts receivable, prepaid expenses and other current assets, accounts payable, accrued expenses, accrued compensation and current portion of long-term debt included in the Company’s condensed consolidated financial statements are reasonable estimates of fair value due to their short maturities. Based on the borrowing rates currently available to the Company for loans with similar terms, management believes the fair value of long-term debt approximates its carrying value. Authoritative guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: Level 1: Quoted prices in active markets for identical assets or liabilities. Level 2: Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active; or other inputs that can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The following table presents information related to the Company’s assets and liabilities measured at fair value on a recurring basis as of March 31, 2021 and December 31, 2020 (in thousands): March 31, 2021 Assets: Level 1 Level 2 Level 3 Total Equity securities $ 7,619 — — $ 7,619 Debt securities — 1,313 — 1,313 Total $ 7,619 1,313 — $ 8,932 Liabilities: Liability classified equity award (1) $ — — 4,533 $ 4,533 Foreign currency forward contract — — — — Total $ — — 4,533 $ 4,533 December 31, 2020 Liabilities: Level 1 Level 2 Level 3 Total Liability classified equity award (1) $ — — 4,108 $ 4,108 Foreign currency forward contract — 878 — 878 Total $ — 878 4,108 $ 4,986 (1) A portion of this award is being accreted over the requisite service period Equity securities with readily determinable fair values are measured at fair value with the changes in fair value recognized through net loss. Upon the filing of the Offer with the AMF in connection with the Tender Offer Agreement, the Company began purchasing outstanding EOS shares and OCEANEs on the open market. As of March 31, 2021, the Company has purchased 2,665,694 shares of EOS, representing approximately 10% of the outstanding shares of EOS, for €6.5 million ($7.6 million). The Company classified the purchased EOS shares within Level 1 of the fair value hierarchy as the shares are traded on the Euronext Paris stock exchange and have a readily determinable fair value. There was approximately $0.1 million in unrealized holding losses recorded in other income and expense on the condensed consolidated statements of operations for the three months ended March 31, 2021. Debt securities consist of convertible debt securities that the Company does not intend to hold until maturity and are therefore classified as available-for-sale. Available-for-sale debt securities are measured at fair value with the changes in fair value recognized through other comprehensive loss. As of March 31, 2021, the Company has purchased 157,167 OCEANEs, representing approximately 4% of the outstanding OCEANEs, for €1.1 million ($1.3 million). The Company classified the purchased OCEANEs within Level 2 of the fair value hierarchy as the OCEANEs have a directly observable par value. There was approximately $0.1 million in unrealized holding losses recorded in other comprehensive loss on the condensed consolidated statement of comprehensive loss for the three months ended March 31, 2021. On December 18, 2020, the Company entered into a foreign currency forward contract, with a notional amount of $117.9 million (€95.6 million) to mitigate the foreign currency exchange risk related to the Tender Offer Agreement, denominated in Euros ("EUR"). The contract is not designated as a hedging instrument. The Company classified the derivative liability within Level 2 of the fair value hierarchy as observable inputs are available for the full term of the derivative instrument. The fair value of the forward contract was developed using a market approach based on publicly available market yield curves and the term of the contract. On March 2, 2021, the foreign currency forward contract was settled for €95.6 million ($115.3 million). The company recognized a $1.7 million loss from the change in fair value of the contract during the three months ended March 31, 2021. The loss on the contract settlement was recorded as other expense on the condensed consolidated statement of operations and is included in investing activities in the condensed consolidated statement of cash flows for the three months ended March 31, 2021. During the second quarter of 2019, the Company issued a liability classified equity award to one of its executive officers. The award will be earned over a 4-year vesting period and upon a specific market condition. As the award will be settled in cash, it is classified as a liability within Level 3 of the fair value hierarchy as the Company is using a probability-weighted income approach, utilizing significant unobservable inputs including the probability of achieving the specified market condition with the valuation updated at each reporting period. The full fair value of the cash settled award was $4.5 million as of March 31, 2021 and is being recognized ratably as the underlying service period is provided. The following table provides a reconciliation of liabilities measured at fair value using significant unobservable inputs (Level 3) for the three months ended March 31, 2021 (in thousands): Level 3 Liabilities Balance at January 1, 2021 $ 1,668 Vested portion of liability classified equity award 258 Change in fair value measurement 199 Balance at March 31, 2021 $ 2,125 Recent Accounting Pronouncements Recently Adopted Accounting Pronouncements As of March 31, 2021, and for the period ended, there are no recently adopted accounting pronouncements that have a material impact on the Company’s financial statements. Recently Issued Accounting Pronouncements In January 2021, the FASB issued ASU No. 2021-01, Reference Rate Reform (Topic 848) In August 2020, the FASB issued ASU No. 2020-06, Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40) , which simplifies the accounting for convertible instruments. The guidance removes certain accounting models that separate the embedded conversion features from the host contract for convertible instruments. ASU 2020-06 allows for a modified or full retrospective method of transition. This update is effective for fiscal years beginning after December 15, 2021, and interim periods within those fiscal years, and early adoption is permitted. The Company does not intend to early adopt the standard and is in the process of assessing the impact, if any, on its consolidated financial statements and related disclosures. |
Select Condensed Consolidated B
Select Condensed Consolidated Balance Sheet Details | 3 Months Ended |
Mar. 31, 2021 | |
Balance Sheet Related Disclosures [Abstract] | |
Select Condensed Consolidated Balance Sheet Details | 3. Select Condensed Consolidated Balance Sheet Details Accounts Receivable, net Accounts receivable, net consist of the following (in thousands): March 31, 2021 December 31, 2020 Accounts receivable $ 26,121 $ 23,887 Allowance for doubtful accounts (370 ) (360 ) Accounts receivable, net $ 25,751 $ 23,527 Inventories, net Inventories, net consist of the following (in thousands): March 31, 2021 December 31, 2020 Raw materials $ 6,182 $ 6,064 Work-in-process 2,303 1,982 Finished goods 80,597 67,892 89,082 75,938 Less reserve for excess and obsolete finished goods (31,706 ) (29,937 ) Inventories, net $ 57,376 $ 46,001 Property and Equipment, net Property and equipment, net consist of the following (in thousands, except as indicated): Useful lives (in years) March 31, 2021 December 31, 2020 Surgical instruments 4 $ 94,932 $ 76,669 Machinery and equipment 7 8,401 6,562 Computer equipment 3 4,891 4,206 Office furniture and equipment 5 3,511 1,380 Leasehold improvements various 1,876 1,761 Construction in progress n/a 1,680 2,738 115,291 93,316 Less accumulated depreciation and amortization (59,167 ) (56,646 ) Property and equipment, net $ 56,124 $ 36,670 Total depreciation expense was $3.4 million and $2.0 million for the three months ended March 31, 2021 and 2020, respectively. Amortization of assets under capital leases is included in depreciation expense. Intangible Assets, net Intangible assets, net consist of the following (in thousands, except as indicated): Remaining Avg. Useful lives (in years) March 31, 2021 December 31, 2020 Developed product technology 12 $ 35,376 $ 35,376 License agreements 1 5,536 5,536 Trademarks and trade names — 792 792 Customer-related 3 7,458 7,458 Distribution network 2 4,027 4,027 In process research and development 7 1,128 1,278 Total Gross Amount $ 54,317 $ 54,467 Less accumulated amortization (30,188 ) (29,747 ) Intangible assets, net $ 24,129 $ 24,720 Total amortization expense attributed to intangible assets was $0.4 million for the three months ended March 31, 2021 and 2020, respectively. The Company recognized a $0.2 million impairment loss related to certain intellectual property on its condensed consolidated statement of operations for the three months ended March 31, 2021. In process research and development intangibles begin amortizing when the relevant products reach full commercial launch. Future amortization expense related to intangible assets as of March 31, 2021 is as follows (in thousands): Year Ending December 31, Remainder of 2021 $ 1,552 2022 1,993 2023 1,993 2024 1,890 2025 1,305 Thereafter 15,396 $ 24,129 Accrued Expenses Accrued expenses consist of the following (in thousands): March 31, 2021 December 31, 2020 Commissions and sales milestones $ 7,886 $ 6,734 Payroll and payroll related 6,101 12,247 Litigation settlement obligation - short-term portion 4,000 4,000 Professional fees 9,262 3,551 Royalties 2,203 2,293 Interest 88 619 Other 7,190 5,787 Total accrued expenses $ 36,730 $ 35,231 Other Long-Term Liabilities Other long-term liabilities consist of the following (in thousands): March 31, 2021 December 31, 2020 Litigation settlement obligation - long-term portion $ 6,721 $ 7,634 Tax liabilities 373 373 Royalties 2,071 1,678 Other 2,124 1,668 Other long-term liabilities $ 11,289 $ 11,353 |
Discontinued Operations
Discontinued Operations | 3 Months Ended |
Mar. 31, 2021 | |
Discontinued Operations And Disposal Groups [Abstract] | |
Discontinued Operations | 4. Discontinued Operations In connection with the sale of the International Business, the Company entered into a product manufacture and supply agreement (the “Supply Agreement”) with Globus, pursuant to which the Company supplies to Globus certain of its implants and instruments, previously offered for sale by the Company in international markets at agreed-upon prices for a minimum term of three years, with the option for Globus to extend the term for up to two additional twelve month periods subject to Globus meeting specified purchase requirements. During the second quarter of 2020, Globus notified the Company that it will exercise the option to extend the agreement for the second additional twelve-month period through August 2021, at which time the Company expects that the Supply Agreement will expire and revenue from Globus will discontinue. In accordance with authoritative guidance, sales to Globus are reported under continuing operations as the Company has continuing involvement under the Supply Agreement. The Company recorded $0.4 million in revenue and $0.5 million in cost of revenue from the Supply Agreement in continuing operations for the three months ended March 31, 2021, and $1.0 million in both revenue and cost of revenue from the Supply Agreement in continuing operations for the three months ended March 31, 2020. |
Debt
Debt | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Debt | 5. Debt MidCap Facility Agreement On May 29, 2020, the Company repaid in full all amounts outstanding under the Amended Credit Facility with MidCap Funding IV, LLC (“MidCap”). The Company made a final payment of $9.6 million to MidCap, consisting of outstanding principal and accrued interest. All amounts previously recorded as debt issuance costs were recorded as part of loss on debt extinguishment on the Company’s consolidated statement of operations for the year ended December 31, 2020. Squadron Medical Credit Agreement On November 6, 2018, the Company entered into a Term Loan with Squadron Medical Finance Solutions, LLC (“Squadron Medical”), a provider of debt financing to growing companies in the orthopedic industry. The Term Loan was subsequently amended on March 27, 2019, May 29, 2020 and December 16, 2020 to expand the availability of additional term loans, extend the maturity, remove all financial covenant requirements and, in the December 16, 2020 amendment, incorporate a debt exchange. In conjunction with the Term Loan amendment on December 16, 2020, the Company entered into a debt exchange agreement whereby the Company exchanged $30.0 million of the Company’s outstanding debt obligations pursuant to the Term Loan dated as of November 6, 2018, as amended, for the issuance of 2,700,270 shares of the Company’s Common Stock to Squadron Capital LLC and a participant lender, based on a price of $11.11 per share. The debt exchange resulted in additional debt issuance costs of $3.8 million calculated as the difference between the Company’s stock price on the date of issuance and the issuance price. The total principal outstanding under the Term Loan as of March 31, 2021 was $45.0 million, with an additional $40.0 million in available borrowings. The Term Loan bears interest at LIBOR plus 8.0% per annum, subject to a 9.0% floor and 12.0% ceiling. Interest-only payments are due monthly until December 2023 and joined by $1.0 million monthly principal payments beginning December 2023. Any remaining principal amounts of the Term Loan will be due on June 30, 2026. In addition to paying interest on outstanding principal on the Term Loan, the Company will pay a commitment fee at a rate of 1.0% per annum to Squadron Medical in respect of the unutilized Term Loan. As collateral for the Term Loan, Squadron Medical has a first lien security interest in all of the Company’s assets. In connection with the initial 2018 financing, the Company issued warrants to Squadron Medical and a participant lender to purchase 845,000 shares of common stock at an exercise price of $3.15 per share. In conjunction with the first draw under the first amendment of the Term Loan in 2019, the Company issued warrants to Squadron Medical and the participant lender to purchase an additional 4,838,710 shares of the Company’s common stock at an exercise price of $2.17 per share. In connection with the second amendment of the Term Loan in May 2020, the Company issued warrants to Squadron Medical and the participant lender to purchase an additional 1,075,820 shares of the Company’s common stock at an exercise price of $4.88 per share. All of the warrants are exercisable immediately and were amended to have the same maturity date in May 2027. Total warrants outstanding to Squadron Medical and the participant lender are as of March 31, 202 1 . The warrants were valued utilizing the Monte-Carlo simulation model as described further in Note 9 and are recorded as a debt discount. The Company accounted for the March 2019, May 2020, and December 2020 amendments of the Term Loan as debt modifications with continued amortization of the existing and inclusion of the new debt issuance costs amortized into interest expense utilizing the effective interest rate method. The Company determined that the $30.0 million pre-payment associated with the December 16, 2020 amendment should be accounted for as a partial extinguishment of the November 6, 2018 Term Loan, as amended. As a result of the partial extinguishment the Company elected as an accounting policy, and in accordance with authoritative guidance set forth by ASC 470-50-40-2, to write off a proportionate amount of the unamortized fees at the time the financing was partially settled in accordance with the terms of the Term Loan dated November 6, 2018, as amended. The unamortized debt issuance costs are allocated between the remaining original Term Loan balance and the portion of the Term Loan paid down on a pro-rata basis. At the time of prepayment, the Company recorded a loss on extinguishment of $6.1 million and capitalized $3.8 million in non-cash debt issuance closing costs. As of March 31, 2021, the debt is recorded at its carrying value of $32.6 million, net of issuance costs of $12.4 million, including all amounts paid to third parties to secure the debt and the fair value of the warrants issued. The total debt discount will be amortized into interest expense through maturity of the debt utilizing the effective interest rate method. Paycheck Protection Loan On April 23, 2020, the Company received the proceeds from a loan in the amount of approximately $4.3 million (the “PPP Loan”) from Silicon Valley Bank, as lender, pursuant to the Paycheck Protection Program (“PPP”) of the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”). The PPP Loan matures on April 21, 2022 and bears interest at a rate of 1.0% per annum. Commencing August 21, 2021, the Company is required to pay the lender equal monthly payments of principal and interest and required to fully amortize by April 21, 2022 the principal amount outstanding on the PPP Loan as of the date prescribed by guidance issued by U.S. Small Business Administration (“SBA”). The PPP Loan is evidenced by a promissory note dated April 21, 2020 (the “Note”), which contains customary events of default relating to, among other things, payment defaults and breaches of representations and warranties. The PPP Loan may be prepaid by the Company at any time prior to maturity with no prepayment penalties. All or a portion of the PPP Loan may be forgiven by the SBA upon application. The Company submitted its application for forgiveness of the loan in November 2020, which was still under review by the SBA as of March 31, 2021. Under the CARES Act, loan forgiveness is available for the sum of documented payroll costs, covered rent payments, covered mortgage interest and covered utilities during the twenty-four-week period, beginning on the date of the loan approval. For purposes of the CARES Act, payroll costs exclude compensation of an individual employee in excess of $100,000, prorated annually. Not more than 25% of the forgiven amount may be for non-payroll costs. Forgiveness is reduced if full-time headcount declines, or if salaries and wages for employees with salaries of $100,000 or less annually are reduced by more than 25%. In the event the PPP Loan, or any portion thereof, is forgiven pursuant to the PPP, the amount forgiven is applied to outstanding principal. The Company used all of the proceeds from the PPP Loan to retain employees and maintain payroll. Although the Company has applied for loan forgiveness as afforded by the PPP, no assurance can be provided that such loan forgiveness will be granted in whole or in part. As of March 31, 2021, $3.8 million and $0.5 million of the PPP Loan were recorded as a current portion of long-term debt and noncurrent portion of long-term debt, respectively, on the Company’s condensed consolidated balance sheet. Inventory Financing In November 2018, the Company entered into an Inventory Financing Agreement with a key inventory and instrument components supplier whereby the Company may draw up to $3.0 million for the purchase of inventory to accrue interest at a rate of LIBOR plus 8.0% subject to a 10.0% floor and 13.0% ceiling. In November 2020, the Company amended the Inventory Financing Agreement with the supplier to increase the available draw to $6.0 million. All principal will become due and payable upon maturity on November 6, 2023 and all interest will be paid monthly. The outstanding obligation under the Inventory Financing Agreement as of March 31, 2021 was $5.1 million. Reference Rate Reform In July 2017, the U.K.’s Financial Conduct Authority (“FCA”), which regulates LIBOR, announced that it intends to phase out LIBOR by the end of 2021. On November 30, 2020, ICE Benchmark Administration (the“IBE”), with the support of the United States Federal Reserve and the FCA, announced plans to consult on ceasing publication of USD LIBOR on December 31, 2021 for only the one week and two-month USD LIBOR tenors, and on June 30, 2023 for all other USD LIBOR tenors. Various central bank committees and working groups continue to discuss replacement of benchmark rates, the process for amending existing LIBOR-based contracts, and the potential economic impacts of different alternatives. The Alternative Reference Rates Committee has identified the Secured Overnight Financing Rate (“SOFR”), as its preferred alternative rate for USD LIBOR. SOFR is a measure of the cost of borrowing cash overnight, collateralized by U.S. Treasury securities, and is based on directly observable U.S. Treasury-backed repurchase transactions. The Company is evaluating the potential impact of the replacement of the LIBOR benchmark interest rate including risk management, internal operational readiness and monitoring the FASB’s standard-setting process to address financial reporting issues that might arise in connection with the transition from LIBOR to a new benchmark rate. Other Debt Agreements The Company has two outstanding capital lease arrangements as of March 31, 2021. The first lease bears interest at an annual rate of 6.4%, is due in monthly principal and interest installments, is collateralized by the related equipment, and matures in December 2022. The second lease agreement does not provide a borrowing rate; therefore the Company used its incremental borrowing rate of 9.0% to determine the present value of lease payments as of the commencement date of the lease. Principal installments on the second lease are due monthly, and the lease is collateralized by the related equipment, and matures in April 2024. Principal payments remaining on the Company's debt are as follows as of March 31, 2021 (in thousands): Year Ending December 31, Remainder of 2021 $ 3,800 2022 1,950 2023 6,216 2024 12,018 2025 12,000 Thereafter 20,000 Total 55,984 Add: capital lease principal payments 330 Less: unamortized debt discount and debt issuance costs (12,360 ) Total 43,954 Less: current portion of long-term debt (5,374 ) Long-term debt, net of current portion $ 38,580 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2021 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 6. Commitments and Contingencies Leases The Company determines if an arrangement is a lease at inception. The Company recognizes right-of-use assets (“ROU assets”) and lease liabilities for office buildings and certain equipment with lease terms of 1 year to 10 years, some of which include options to extend and/or terminate the lease. The value of the Company’s lease liability is the present value of fixed payments not yet paid, discounted using either the rate implicit in the lease contract if that rate can be determined, or the Company’s incremental borrowing rate (“IBR”). The value of the Company’s ROU assets is the lease liability adjusted for any prepaid rent or lease incentives. The Company’s IBR is determined as the rate of interest that the Company would have to pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. The exercise of lease renewal options is at the Company’s sole discretion and were not included in the calculation of the Company’s lease liability as the Company is not able to determine without uncertainty if the renewal option will be exercised. The depreciable life of assets and leasehold improvements are limited to the expected term unless there is a transfer of title or purchase option reasonably certain of exercise. The Company’s lease agreements do not contain any variable lease payments, residual value guarantees or restrictive covenants. Operating Lease The Company occupies approximately 121,541 square feet of office, engineering, and research and development space in Carlsbad, California. The term of the lease commenced on February 1, 2021 and will terminate on January 31, 2031, subject to two sixty-month options to renew. The Company recognized a $21.1 million ROU asset and $21.5 million lease liability on the condensed consolidated balance sheet upon taking control of the premises on the lease commencement date. The Company used an IBR of 9.0% when determining amounts to be recognized on the condensed consolidated balance sheet related to the ROU asset and lease liability. Base rent under the building lease for the first twelve months of the term will be $195,000 per month subject to full abatement during months two through ten . Base rent for the second year of the term will be $ 244,115 per month and thereafter will increase annually by 3.0 %. The Company leases its buildings and certain equipment under operating leases which expire on various dates through 2031. Any short-term leases defined as twelve months or less or month-to-month leases were excluded and continue to be expensed each month. Total costs associated with these leases for the three months ended March 31, 2021 were immaterial. Lease expense for lease payments is recognized on a straight-line basis over the lease term. Future minimum annual lease payments under such leases are as follows as of March 31, 2021 (in thousands): Undiscounted lease payments: Year Ending December 31, Remainder of 2021 $ 874 2022 3,534 2023 3,583 2024 3,603 2025 3,662 Thereafter 20,154 Total undiscounted lease payments 35,410 Less: present value adjustment (13,172 ) Operating lease liability 22,238 Less: current portion of operating lease liability (1,486 ) Operating lease liability, less current portion $ 20,752 As of March 31, 2021, the Company’s average remaining lease term is The Company paid $0.4 million on its operating lease agreements March 31, 2021 Purchase Commitments The Company entered into a distribution agreement with a third-party provider in January 2020 in which the Company is obligated to certain minimum purchase requirements related to inventory and equipment leases. As of March 31, 2021, the minimum purchase commitment required by the Company under the agreement was $2.6 million to be paid over a three-year Litigation The Company is and may become involved in various legal proceedings arising from its business activities. While management is not aware of any litigation matter that in and of itself would have a material adverse impact on the Company’s consolidated results of operations, cash flows or financial position, litigation is inherently unpredictable, and depending on the nature and timing of a proceeding, an unfavorable resolution could materially affect the Company’s future consolidated results of operations, cash flows or financial position in a particular period. The Company assesses contingencies to determine the degree of probability and range of possible loss for potential accrual or disclosure in the Company’s consolidated financial statements. An estimated loss contingency is accrued in the Company’s consolidated financial statements if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Because litigation is inherently unpredictable and unfavorable resolutions could occur, assessing contingencies is highly subjective and requires judgments about future events. When evaluating contingencies, the Company may be unable to provide a meaningful estimate due to a number of factors, including the procedural status of the matter in question, the presence of complex or novel legal theories, and/or the ongoing discovery and development of information important to the matters. In addition, damage amounts claimed in litigation against the Company may be unsupported, exaggerated or unrelated to reasonably possible outcomes, and as such are not meaningful indicators of the Company’s potential liability. In February 2018, NuVasive, Inc. filed suit against the Company in the United States District Court for the Southern District of California ( NuVasive, Inc. v. Alphatec Holdings, Inc. et al. the Company’s products (including components of its Battalion™ Lateral System), infringe, or contribute to the infringement of, U.S. Patent Nos. 7,819,801, 8,355,780, 8,439,832, 8,753,270, 9,833,227 (entitled “Surgical access system and related methods”), U.S. Patent No. 8,361,156 (entitled “Systems and methods for spinal fusion”), and U.S. Design Patent Nos. D652,519 (“Dilator”) and D750,252 (“Intervertebral Implant”). NuVasive seeks unspecified monetary damages and an injunction against future purported infringement. In March 2018, the Company moved to dismiss NuVasive’s claims of infringement of its design patents for failure to state a cognizable legal claim. In May 2018, the Court ruled that NuVasive failed to state a plausible claim for infringement of the asserted design patents and dismissed those claims with prejudice. The Company filed its answer, affirmative defenses and counterclaims to NuVasive’s remaining claims in May 2018. Also in March 2018, NuVasive moved for a preliminary injunction. In March 2018, the Court denied that motion without prejudice for failure to comply with the Court’s chambers rules. In April 2018, NuVasive again moved for a preliminary injunction. In July 2018, after a hearing on the matter in June 2018, the Court denied that motion on the grounds that NuVasive failed to establish either likelihood of success on the merits or that it would suffer irreparable harm absent injunction. In September 2018, NuVasive filed an Amended Complaint, asserting additional infringement claims of U.S. Patent Nos. 9,924,859, 9,974,531 and 8,187,334. The Company filed its answer, affirmative defenses and counterclaims to these claims in October 2018. Also in October 2018, NuVasive moved to dismiss the Company’s counterclaims that NuVasive intentionally had misled the U.S. Patent and Trademark Office as a means of obtaining certain patents asserted against the Company. In January 2019, the Court denied NuVasive’s motion as to all but one counterclaim, but granted the Company leave to amend that counterclaim to cure dismissal. The Company amended that counterclaim in February 2019 and, that same month, NuVasive again moved to dismiss it. In March 2019, the Court denied NuVasive’s motion. NuVasive filed its Answer to the amended counterclaim in April 2019. In December 2018, the Company filed a petition with the Patent Trial and Appeal Board (“PTAB”) challenging the validity of certain claims of the ’156 and ’334 Patents. In July 2019, PTAB instituted Inter Partes Review of the validity of asserted claims of the two patents at issue and held a hearing on the matter in April 2020. In July 2020, the PTAB ruled that all challenged claims of the ‘156 Patent were valid (not unpatentable) and ruled that several challenged claims of the ‘334 Patent were invalid, while finding that other challenged claims of the ‘334 Patent valid. NuVasive and the Company have both appealed the PTAB’s written decision on the matter. The appeals are currently pending before the U.S. Court of Appeals for the Federal Circuit. Alphatec filed its Principal Brief on February 8, 2021. NuVasive filed its Principal Brief on April 21, 2021. In January 2020, NuVasive filed a Motion for Partial Summary Judgment of infringement and validity of the ’832, ’780 and ’270 Patents and the Company filed a Motion for Summary Judgment of non-infringement of all asserted claims and of invalidity of the ’832 Patent and for dismissal of NuVasive’s claim for lost profits and its allegations of assignor estoppel. In April 2020, the Court granted NuVasive’s Motion as to the alleged infringement of the ’832 Patent only and denied NuVasive’s Motion in all other respects. Also, in April 2020, the Court granted the Company’s Motion as to dismissal of the allegations of assignor estoppel and denied the Company’s Motion in all other respects. In January 2021, NuVasive filed a Motion for Partial Summary Judgment of infringement and validity of the ’156 and ’334 Implant Patents and the Company filed a Motion for Summary Judgment of invalidity of those same patents. These motions are pending before the Court. Due to the Court’s scheduling in relation to the COVID-19 pandemic, the trial previously scheduled for June 2021 has been vacated and will be rescheduled. The Company believes that the allegations lack merit and intends to vigorously defend all claims asserted. A liability is recorded in the consolidated financial statements if it is believed to be probable that a loss has been incurred and the amount of the loss can be reasonably estimated. It is impossible at this time to assess whether the outcome of this proceeding will have a material adverse effect on the Company’s consolidated results of operations, cash flows or financial position. Therefore, in accordance with authoritative accounting guidance, the Company has not recorded any accrual for a contingent liability associated with this legal proceeding based on its belief that a liability, while possible, is not probable and any range of potential future charge cannot be reasonably estimated at this time. Indemnifications In the normal course of business, the Company enters into agreements under which it occasionally indemnifies third-parties for intellectual property infringement claims or claims arising from breaches of representations or warranties. In addition, from time to time, the Company provides indemnity protection to third-parties for claims relating to past performance arising from undisclosed liabilities, product liabilities, environmental obligations, representations and warranties, and other claims. In these agreements, the scope and amount of remedy, or the period in which claims can be made, may be limited. It is not possible to determine the maximum potential amount of future payments, if any, due under these indemnities due to the conditional nature of the obligations and the unique facts and circumstances involved in each agreement. In October 2017, NuVasive filed a lawsuit in Delaware Chancery Court against Mr. Miles, the Company’s Chairman and CEO, who was a former officer and board member of NuVasive. The Company itself was not initially a named defendant in this lawsuit; however, on June 28, 2018, NuVasive amended its complaint to add the Company as a defendant. On October 12, 2018, the Delaware Court ordered that NuVasive begin advancing legal fees for Mr. Miles’ defense in the lawsuit, as well as Mr. Miles’ legal fees incurred in pursuing advancement of his fees, pursuant to an indemnification agreement between NuVasive and Mr. Miles. As of March 31, 2021, the Company has not recorded any liability on the condensed consolidated balance sheet related to this matter. Royalties The Company has entered into various intellectual property agreements requiring the payment of royalties based on the sale of products that utilize such intellectual property. These royalties primarily relate to products sold by Alphatec Spine and are based on fixed fees or calculated either as a percentage of net sales or on a per-unit sold basis. Royalties are included on the accompanying condensed consolidated statements of operations as a component of cost of revenue. As of March 31, 2021, the Company is obligated to pay guaranteed minimum royalty payments under these agreements of approximately $4.7 million through 2026 and beyond. |
Orthotec Settlement
Orthotec Settlement | 3 Months Ended |
Mar. 31, 2021 | |
Commitments And Contingencies Disclosure [Abstract] | |
Orthotec Settlement | 7. Orthotec Settlement On September 26, 2014, the Company entered into a Settlement and Release Agreement, dated as of August 13, 2014, by and among the Company and its direct subsidiaries, including Alphatec Spine, Inc., Alphatec Holdings International C.V., Scient'x S.A.S. and Surgiview S.A.S.; HealthpointCapital, LLC, HealthpointCapital Partners, L.P., HealthpointCapital Partners II, L.P., John H. Foster and Mortimer Berkowitz III; and Orthotec, LLC and Patrick Bertranou, (the “Settlement Agreement”). Pursuant to the Settlement Agreement, the Company agreed to pay Orthotec, LLC $49.0 million in cash, including initial cash payments totaling $1.75 million, which the Company previously paid in March 2014, and an additional lump sum payment of $15.75 million, which the Company previously paid in April 2014. The Company agreed to pay the remaining $31.5 million in 28 quarterly installments of $1.1 million and one additional quarterly installment of $0.7 million, commencing October 1, 2014. The payments set forth above are guaranteed by Stipulated Judgments held against the Company, HealthpointCapital Partners, L.P., HealthpointCapital Partners II, L.P., HealthpointCapital, LLC, John H. Foster and Mortimer Berkowitz III and, in the event of a default, will be entered and enforced against these entities and/or individuals in that order. In September 2014, the Company and HealthpointCapital entered into an agreement for joint payment of settlement whereby HealthpointCapital has agreed to contribute $5.0 million to the $49.0 million settlement amount. In October 2020, HealthpointCapital began its $5.0 million contribution, which will be in the form of five quarterly payments. The remaining $2.9 million receivable from HealthpointCapital, LLC continues to be classified within stockholders’ equity on the Company’s condensed consolidated balance sheets due to the related party nature with HealthpointCapital affiliates. Payments made by HealthpointCapital will be recorded as a reduction to stockholder’s equity. See Note 11 for further information. As of March 31, 2021, the Company has made installment payments in the aggregate of $46.1 million, with a remaining outstanding balance of $11.7 million (including interest). The Company has the right to prepay the amounts due without penalty. In addition, the unpaid balance of the amounts due accrues interest at the rate of 7% per year until paid in full. The accrued but unpaid interest will be paid in quarterly installments of $1.1 million (or the full amount of the accrued but unpaid interest if less than $1.1 million) following the full payment of the $31.5 million in quarterly installments described above. No additional interest will accrue on the accrued interest. The Settlement Agreement provides for mutual releases of all claims in the Orthotec, LLC v. Surgiview, S.A.S, et al. matter in the Superior Court of California, Los Angeles County and all other related litigation matters involving the Company and its directors and affiliates. A reconciliation of the total net settlement obligation is as follows (in thousands): March 31, 2021 December 31, 2020 Litigation settlement obligation - short-term portion $ 4,000 $ 4,000 Litigation settlement obligation - long-term portion 6,721 7,634 Total 10,721 11,634 Future interest 1,012 1,199 Total settlement obligation, gross 11,733 12,833 Related party receivable - included in stockholders' equity (2,900 ) (4,000 ) Total settlement obligation, net $ 8,833 $ 8,833 |
Net Loss Per Share
Net Loss Per Share | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | 8. Net Loss Per Share Basic net loss per share is calculated by dividing the net income or loss available to common stockholders by the weighted average number of common shares outstanding for the period, including contingently redeemable common stock recorded outside of stockholder’s equity. Diluted net loss per share attributable to common stockholders is calculated by dividing net loss available to common stockholders by the diluted weighted average number of common shares outstanding for the period, including contingently redeemable common stock. Diluted net loss from continuing operations per share attributable to common stockholders is calculated by dividing income from continuing operations available to common stockholders by the diluted weighted average number of common shares outstanding for the period, including contingently redeemable common stock. Diluted net loss from discontinued operations per share attributable to common stockholders is calculated by dividing loss from discontinued operations available to common stockholders by the diluted weighted average number of common shares outstanding for the period, including contingently redeemable common stock. The following table presents the computation of basic and diluted net loss per share for continuing and discontinued operations (in thousands, except per share amounts): Three Months Ended March 31, 2021 2020 Numerator: Net loss, basic and diluted $ (22,903 ) $ (20,722 ) Denominator: Weighted average common shares outstanding 87,408 62,732 Weighted average unvested common shares subject to repurchase (185 ) (164 ) Weighted average common shares outstanding - basic and diluted 87,223 62,568 Net loss per share, basic and diluted: $ (0.26 ) $ (0.33 ) The anti-dilutive securities not included in diluted net As of March 31, 2021 2020 Series A Convertible Preferred Stock 29 67 Options to purchase common stock 3,898 4,195 Unvested restricted share awards 8,866 6,487 Warrants to purchase common stock 21,594 24,372 Total 34,387 35,121 |
Stock Benefit Plans and Equity
Stock Benefit Plans and Equity Transactions | 3 Months Ended |
Mar. 31, 2021 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock Benefit Plans and Equity Transactions | 9. Stock Benefit Plans and Equity Transactions Stock Benefit Plans On June 17, 2020, the Company’s shareholders approved an amendment to the Company’s 2016 Equity Incentive Award Plan, which increased the shares of common stock available for issuance under the Equity Plan by 7,000,000 shares. At March 31, 2021, 3,101,477 shares of common stock were available for issuance under the 2016 Equity Incentive Award Plan. In 2007, the Company adopted the Alphatec Holdings, Inc. 2007 Employee Stock Purchase Plan (the “ESPP”), which was amended in May 2017. At March 31, 2021, 216,131 shares of common stock were available for purchase under the ESPP. Stock-Based Compensation Total stock-based compensation for the three months ended March 31, 2021 were as follows (in thousands): Three Months Ended March 31, 2021 2020 Cost of revenues $ 95 $ 107 Research and development 498 390 Sales, general and administrative 3,881 3,071 Total $ 4,474 $ 3,568 Shares Reserved for Future Issuance As of March 31, 2021, the Company’s shares of common stock reserved for future issuance were as follows (in thousands): Stock options outstanding 3,898 Unvested restricted stock award 8,866 Employee stock purchase plan 216 Series A convertible preferred stock 29 Warrants outstanding 21,594 Authorized for future grant under the Distributor and Development Services plans 7,751 Authorized for future grant under the Management Objective Strategic Incentive Plan 345 Authorized for future grant under the Company equity plans 3,963 Total 46,662 Contingently Redeemable Common Stock In connection with the Offer, on December 16, 2020, the Company entered into a Securities Purchase Agreement with certain purchasers, providing for the sale by the Company of 12,421,242 shares of the Company’s common stock at a purchase price of $11.11 per share for aggregate gross proceeds of $138.0 million. The private placement closed on March 1, 2021, and generated net proceeds of approximately $131.8 million, net of fees related to the private placement. If the Tender Offer Agreement is terminated or the closing of the Offer has not occurred by July 31, 2021, then the Company is required repurchase the shares sold in the private placement for an amount per share equal to the purchase price paid for such shares plus interest at a rate equal to 9.0% per year computed from the date of the closing of the private placement to the date of the repurchase. Since the shares of common stock issued in the private placement are contingently redeemable if the Offer is not successful, the Company will present the shares of common stock subject to repurchase outside of stockholders’ equity in the condensed consolidated balance sheet until the close of the Offer. The Company determined that meeting the contingency is not probable; therefore, the contingently redeemable common stock was not remeasured to fair value at March 31, 2021. When the Offer closes, the shares of common stock issued in the private placement will be reclassified to stockholders’ equity. Warrants Outstanding 2017 PIPE Warrants The 2017 Common Stock Warrants (the “2017 PIPE Warrants”) have a five-year 2018 PIPE Warrants The 2018 Common Stock Warrants (the “2018 PIPE Warrants”) have a five-year SafeOp Surgical Merger Warrants In conjunction with the Company’s 2018 acquisition of SafeOp, the Company issued warrants to purchase 2,200,000 shares of common stock at an exercise price of $3.50 per share, which have a five-year life and are exercisable by cash or cashless exercise. During the three months ended March 31, 2021 and 2020, there were 969,932 and 0 SafeOp Surgical Merger Warrant exercises for cash proceeds of $0.1 million and $0.0 million, respectively. As of March 31, 2021, 1,194,943 SafeOp Surgical Merger Warrants remained outstanding. Squadron Medical Warrants As further described in Note 5, during the year ended December 31, 2018, in connection with the initial debt financing with Squadron Medical and a participant lender, the Company issued warrants to purchase 845,000 shares of common stock at an exercise price of $3.15 per share. An additional 4,838,710 warrants were issued at an exercise price of $2.17 per share during the second quarter of 2019, in conjunction with the Company’s draw on the expanded credit facility. In May 2020, an additional 1,075,820 warrants were issued at an exercise price of $4.88 per share in conjunction with the Company’s second amendment to the Squadron Medical debt for total warrants outstanding to Squadron Medical and the participant lender of 6,759,530. In conjunction with the second amendment, the expiration dates for all existing warrants were extended to May 29, 2027 in order to align all outstanding warrant expiration dates. In accordance with authoritative accounting guidance, the warrants qualified for equity treatment upon issuance and were recorded as a debt discount to the face of the debt liability based on fair value to be amortized into interest expense over the life of the debt agreement. The fair value assigned to the warrant amendment was also allocated as a debt issuance cost and amortized into interest expense. As the warrants provide for partial price protection that allow for a reduction in the price in the event of a lower per share priced issuance, the warrants were valued utilizing a Monte Carlo simulation that considers the probabilities of future financings. The Monte Carlo model simulates the present value of the potential outcomes of future stock prices of the Company over the seven-year life of the warrants. The projection of stock prices is based on the risk-free rate of return and the volatility of the stock price of the Company and correlates future equity raises based on the probabilities provided. No Squadron Medical Warrants have been exercised as of March 31, 2021. Executive Warrants In December 2017 the Company issued warrants to Mr. Patrick S. Miles, the Company’s Chairman and Chief Executive Officer, to purchase 1,327,434 shares of the Company’s common stock for $5 per share (the “Executive Warrants”). The warrants have a five-year A summary of all outstanding warrants for common stock as of March 31, 2021 were as follows: Number of Warrants Strike Price Expiration 2017 PIPE Warrants 2,962,000 $ 2.00 June 2022 2018 PIPE Warrants 9,231,903 $ 3.50 May 2023 SafeOp Surgical Merger Warrants 1,194,943 $ 3.50 May 2023 2018 Squadron Medical Warrants 845,000 $ 3.15 May 2027 2019 Squadron Medical Warrants 4,838,710 $ 2.17 May 2027 2020 Squadron Medical Warrants 1,075,820 $ 4.88 May 2027 Executive Warrants 1,327,434 $ 5.00 December 2022 Other* 117,812 $ 3.85 Various through May 2023 Total 21,593,622 (1) Represents weighted average exercise price. All outstanding warrants were deemed to qualify for equity classification under authoritative accounting guidance. 2017 Distributor Inducement Plan and 2017 Development Services Plan Under the 2017 Distributor Inducement Plan, the Company is authorized to grant up to 1,000,000 shares of common stock to third-party distributors whereby, upon the achievement of certain Company sales and/or distribution milestones the Company may grant to a distributor shares of common stock or warrants to purchase shares of common stock. The warrants and restricted stock units issued under the plan are subject to time based or net sales-based vesting conditions. As of March 31, 2021, 525,000 warrants and 284,500 shares of restricted common stock have been granted under the 2017 Distributor Inducement Plan. As of March 31, 2021, 185,000 warrants and 64,500 shares of common stock have been earned or issued under the plan. Warrants granted under the plan as of March 31, 2021 were not yet subject to expiration related to any time or sales-based vesting conditions. Expense recorded for the plan was $0.1 million for the three months ended March 31, 2021 and 2020. Under the 2017 Development Services Plan, the Company is authorized to grant up to 7,000,000 shares of common stock to third-party individuals or entities whereby, upon the achievement of certain Company financial and commercial revenue milestones, future royalty payments for product and/or intellectual property development work may be paid in either cash or restricted shares of Company common stock at the election of the developer. Each common stock issuance is subject to net sales-based and other vesting provisions and satisfaction of applicable laws and market regulations regarding the issuance of restricted shares to such developers. As of March 31, 2021, the Company has entered into Development Services Agreements pursuant to which the Company has allocated 6,649,000 shares and granted 3,340,000 shares of restricted common stock under the 2017 Development Services Plan, subject to achievement of the performance criteria and vesting conditions set forth in such Development Services Agreements. As of March 31, 2021, none of the grants were deemed probable of equity election and no common stock elections or cash payouts were made under the Development Services Plan. The Company will recognize a non-cash charges to cost of sales associated with each of the Development Services Agreements when it is probable respective performance targets will be achieved. 2019 Management Objective Strategic Incentive Plan Under the 2019 Management Objective Strategic Incentive Plan, the Company is authorized to grant up to 500,000 shares of common stock to third-party individuals or entities that do not qualify under the Company’s other existing equity plans, with a maximum grant of 50,000 shares per participant. As of March 31, 2021, 130,000 restricted shares and a warrant to purchase up to 25,000 restricted common stock shares have been granted under the 2019 Management Objective Strategic Incentive Plan. Total expense for the plan was $0.1 million and a negligible amount for three months ended March 31, 2021 and 2020, respectively. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 10. Income Taxes To calculate its interim tax provision, at the end of each interim period the Company estimates the annual effective tax rate and applies that to its ordinary quarterly earnings. In addition, the effect of changes in enacted tax laws or rates or tax status is recognized in the interim period in which the change occurs. The computation of the annual estimated effective tax rate at each interim period requires certain estimates and significant judgment including, but not limited to, the expected operating income for the year, projections of the proportion of income earned and taxed in foreign jurisdictions, permanent and temporary differences between book and tax amounts, and the likelihood of recovering deferred tax assets generated in the current year. The accounting estimates used to compute the provision for income taxes may change as new events occur, additional information is obtained or the tax environment changes. Intraperiod tax allocation rules require the Company to allocate the provision for income taxes between continuing operations and other categories of earnings, such as discontinued operations. In periods in which the Company has a year-to-date pre-tax loss from continuing operations and pre-tax income in other categories of earnings, such as discontinued operations, the Company must allocate the tax provision to the other categories of earnings, and then record a related tax benefit in continuing operations. For the three months ended March 31, 2021, the Company had an annual estimated-effective tax rate of (0.22%) and recognized an immaterial amount of income tax provision from continuing operations. The Company’s effective tax rate differs from the federal statutory rate of 21% primarily due to the Company’s net loss position and valuation allowance. At December 31, 2020, the Company had unrecognized tax benefits of $2.5 million which will affect the effective tax rate if recognized when the Company no longer has a valuation allowance offsetting its deferred tax assets. At December 31, 2020, the Company had federal and state net operating loss carryforwards of $273.7 million and $193.4 million, respectively, which began expiring at various dates beginning in 2021 and will continue to expire through 2040. Federal and some state net operating losses generated in years ending after December 31, 2017 can be carried forward indefinitely. At December 31, 2020, the Company had state research and development tax credit carryforwards of $3.2 million. The state research and development tax credits do not have an expiration date and may be carried forward indefinitely. Utilization of the net operating loss and tax credit carryforwards may become subject to annual limitations due to ownership change limitations that could occur in the future as provided by Section 382 and 383 of the Internal Revenue Code of 1986, as amended, as well as similar state provisions. These ownership changes may limit the amount of the net operating loss and tax credit carryforwards that can be utilized annually to offset future taxable income, if the Company experiences a cumulative change in ownership of more than 50% within a three-year |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2021 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 11. Related Party Transactions In July 2016, the Company entered into a forbearance agreement with HealthpointCapital, LLC, HealthpointCapital Partners, L.P., and HealthpointCapital Partners II, L.P. (collectively, "HealthpointCapital"), pursuant to which HealthpointCapital, on behalf of the Company, paid $1.0 million of the $1.1 million payment due and payable by the Company to Orthotec on July 1, 2016 and agreed to not exercise its contractual rights to seek an immediate repayment of such amount. Pursuant to this forbearance agreement, the Company repaid this amount in September 2016. The Company and HealthpointCapital also entered into an agreement for joint payment of settlement whereby HealthpointCapital has agreed to contribute $5.0 million to the $49.0 million Orthotec settlement amount. In October 2020, began its $5.0 million contribution, which will be in the form of quarterly payments. During the second quarter of 2018, HealthpointCapital Partners, L.P., and HealthpointCapital Partners II, L.P. distributed its holdings in the Company’s common stock to its limited partners. As a result, the fund is no longer a shareholder of the Company as of March 31, 2021 classified within stockholders’ equity on the Company’s condensed consolidated balance sheets due to the related party nature with HealthpointCapital affiliates. Payments made by HealthpointCapital will be recorded as a reduction to stockholder’s equity. In November 2018, the Company entered into a Term Loan and Financing agreement with affiliates of Squadron Capital, LLC. The Term Loan was amended in March 2019, May 2020 and December 2020, as further described in Note 5. Squadron Capital, LLC was a lead investor in the private placement of shares of the Company’s common stock that was closed on March 1, 2021. David Pelizzon, President and Director of Squadron Capital, LLC, currently serves on the Company’s Board of Directors. Included on the condensed consolidated balance sheet as of March 31, 2021 is a $1.1 million officer receivable for settlement of a tax liability related to the vesting of restricted common stock. A corresponding liability for the same amount is also included within accrued expenses on the condensed consolidated balance sheet. |
Subsequent Event
Subsequent Event | 3 Months Ended |
Mar. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Event | 12. Subsequent Event On April 9, 2021, the Company entered into a new lease agreement for a new distribution center which consists of approximately 75,643 square feet of office and warehouse space in Memphis, Tennessee. The term of the new lease commenced on May 1, 2021 and will terminate on May 1, 2028, subject to two thirty-six month options to renew. The Company recognized an ROU asset and lease liability upon taking control of the premises on the lease commencement date. The Company is expected to occupy a proportionate share of the building upon commencement of the lease on May 1, 2021 and is expected to occupy 100% of the premises beginning in November 2022. Base rent under the new building lease for the first twelve months of the term will be $14,667 per month and will increase to $18,792 per month for the first six-months of the second-year of the term, and increase to $28,426 for the final six-months of the second year of the term. Thereafter base rent will increase annually by 3% throughout the remainder of the lease. On April 1, 2021, the Company commenced the Offer to purchase for cash all issued and outstanding EOS shares and all outstanding OCEANEs for a total purchase price of up to approximately $116.9 million. The Offer will remain open for an initial acceptance period of 25 Euronext € €1.2 million ($1.5 million). |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Fair Value Measurements | Fair Value Measurements T he carrying amount of financial instruments consisting of cash, trade accounts receivable, prepaid expenses and other current assets, accounts payable, accrued expenses, accrued compensation and current portion of long-term debt included in the Company’s condensed consolidated financial statements are reasonable estimates of fair value due to their short maturities. Based on the borrowing rates currently available to the Company for loans with similar terms, management believes the fair value of long-term debt approximates its carrying value. Authoritative guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: Level 1: Quoted prices in active markets for identical assets or liabilities. Level 2: Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active; or other inputs that can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The following table presents information related to the Company’s assets and liabilities measured at fair value on a recurring basis as of March 31, 2021 and December 31, 2020 (in thousands): March 31, 2021 Assets: Level 1 Level 2 Level 3 Total Equity securities $ 7,619 — — $ 7,619 Debt securities — 1,313 — 1,313 Total $ 7,619 1,313 — $ 8,932 Liabilities: Liability classified equity award (1) $ — — 4,533 $ 4,533 Foreign currency forward contract — — — — Total $ — — 4,533 $ 4,533 December 31, 2020 Liabilities: Level 1 Level 2 Level 3 Total Liability classified equity award (1) $ — — 4,108 $ 4,108 Foreign currency forward contract — 878 — 878 Total $ — 878 4,108 $ 4,986 (1) A portion of this award is being accreted over the requisite service period Equity securities with readily determinable fair values are measured at fair value with the changes in fair value recognized through net loss. Upon the filing of the Offer with the AMF in connection with the Tender Offer Agreement, the Company began purchasing outstanding EOS shares and OCEANEs on the open market. As of March 31, 2021, the Company has purchased 2,665,694 shares of EOS, representing approximately 10% of the outstanding shares of EOS, for €6.5 million ($7.6 million). The Company classified the purchased EOS shares within Level 1 of the fair value hierarchy as the shares are traded on the Euronext Paris stock exchange and have a readily determinable fair value. There was approximately $0.1 million in unrealized holding losses recorded in other income and expense on the condensed consolidated statements of operations for the three months ended March 31, 2021. Debt securities consist of convertible debt securities that the Company does not intend to hold until maturity and are therefore classified as available-for-sale. Available-for-sale debt securities are measured at fair value with the changes in fair value recognized through other comprehensive loss. As of March 31, 2021, the Company has purchased 157,167 OCEANEs, representing approximately 4% of the outstanding OCEANEs, for €1.1 million ($1.3 million). The Company classified the purchased OCEANEs within Level 2 of the fair value hierarchy as the OCEANEs have a directly observable par value. There was approximately $0.1 million in unrealized holding losses recorded in other comprehensive loss on the condensed consolidated statement of comprehensive loss for the three months ended March 31, 2021. On December 18, 2020, the Company entered into a foreign currency forward contract, with a notional amount of $117.9 million (€95.6 million) to mitigate the foreign currency exchange risk related to the Tender Offer Agreement, denominated in Euros ("EUR"). The contract is not designated as a hedging instrument. The Company classified the derivative liability within Level 2 of the fair value hierarchy as observable inputs are available for the full term of the derivative instrument. The fair value of the forward contract was developed using a market approach based on publicly available market yield curves and the term of the contract. On March 2, 2021, the foreign currency forward contract was settled for €95.6 million ($115.3 million). The company recognized a $1.7 million loss from the change in fair value of the contract during the three months ended March 31, 2021. The loss on the contract settlement was recorded as other expense on the condensed consolidated statement of operations and is included in investing activities in the condensed consolidated statement of cash flows for the three months ended March 31, 2021. During the second quarter of 2019, the Company issued a liability classified equity award to one of its executive officers. The award will be earned over a 4-year vesting period and upon a specific market condition. As the award will be settled in cash, it is classified as a liability within Level 3 of the fair value hierarchy as the Company is using a probability-weighted income approach, utilizing significant unobservable inputs including the probability of achieving the specified market condition with the valuation updated at each reporting period. The full fair value of the cash settled award was $4.5 million as of March 31, 2021 and is being recognized ratably as the underlying service period is provided. The following table provides a reconciliation of liabilities measured at fair value using significant unobservable inputs (Level 3) for the three months ended March 31, 2021 (in thousands): Level 3 Liabilities Balance at January 1, 2021 $ 1,668 Vested portion of liability classified equity award 258 Change in fair value measurement 199 Balance at March 31, 2021 $ 2,125 |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Recently Adopted Accounting Pronouncements As of March 31, 2021, and for the period ended, there are no recently adopted accounting pronouncements that have a material impact on the Company’s financial statements. Recently Issued Accounting Pronouncements In January 2021, the FASB issued ASU No. 2021-01, Reference Rate Reform (Topic 848) In August 2020, the FASB issued ASU No. 2020-06, Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40) , which simplifies the accounting for convertible instruments. The guidance removes certain accounting models that separate the embedded conversion features from the host contract for convertible instruments. ASU 2020-06 allows for a modified or full retrospective method of transition. This update is effective for fiscal years beginning after December 15, 2021, and interim periods within those fiscal years, and early adoption is permitted. The Company does not intend to early adopt the standard and is in the process of assessing the impact, if any, on its consolidated financial statements and related disclosures. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Assets and Liabilities Measured at Fair Value on Recurring Basis | The following table presents information related to the Company’s assets and liabilities measured at fair value on a recurring basis as of March 31, 2021 and December 31, 2020 (in thousands): March 31, 2021 Assets: Level 1 Level 2 Level 3 Total Equity securities $ 7,619 — — $ 7,619 Debt securities — 1,313 — 1,313 Total $ 7,619 1,313 — $ 8,932 Liabilities: Liability classified equity award (1) $ — — 4,533 $ 4,533 Foreign currency forward contract — — — — Total $ — — 4,533 $ 4,533 December 31, 2020 Liabilities: Level 1 Level 2 Level 3 Total Liability classified equity award (1) $ — — 4,108 $ 4,108 Foreign currency forward contract — 878 — 878 Total $ — 878 4,108 $ 4,986 (1) A portion of this award is being accreted over the requisite service period |
Reconciliation of Liabilities Measured at Fair Value Using Significant Unobservable Inputs | The following table provides a reconciliation of liabilities measured at fair value using significant unobservable inputs (Level 3) for the three months ended March 31, 2021 (in thousands): Level 3 Liabilities Balance at January 1, 2021 $ 1,668 Vested portion of liability classified equity award 258 Change in fair value measurement 199 Balance at March 31, 2021 $ 2,125 |
Select Condensed Consolidated_2
Select Condensed Consolidated Balance Sheet Details (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Balance Sheet Related Disclosures [Abstract] | |
Accounts receivable, net | Accounts receivable, net consist of the following (in thousands): March 31, 2021 December 31, 2020 Accounts receivable $ 26,121 $ 23,887 Allowance for doubtful accounts (370 ) (360 ) Accounts receivable, net $ 25,751 $ 23,527 |
Inventories, net | Inventories, net consist of the following (in thousands): March 31, 2021 December 31, 2020 Raw materials $ 6,182 $ 6,064 Work-in-process 2,303 1,982 Finished goods 80,597 67,892 89,082 75,938 Less reserve for excess and obsolete finished goods (31,706 ) (29,937 ) Inventories, net $ 57,376 $ 46,001 |
Property and equipment, net | Property and equipment, net consist of the following (in thousands, except as indicated): Useful lives (in years) March 31, 2021 December 31, 2020 Surgical instruments 4 $ 94,932 $ 76,669 Machinery and equipment 7 8,401 6,562 Computer equipment 3 4,891 4,206 Office furniture and equipment 5 3,511 1,380 Leasehold improvements various 1,876 1,761 Construction in progress n/a 1,680 2,738 115,291 93,316 Less accumulated depreciation and amortization (59,167 ) (56,646 ) Property and equipment, net $ 56,124 $ 36,670 |
Intangible assets, net | Intangible assets, net consist of the following (in thousands, except as indicated): Remaining Avg. Useful lives (in years) March 31, 2021 December 31, 2020 Developed product technology 12 $ 35,376 $ 35,376 License agreements 1 5,536 5,536 Trademarks and trade names — 792 792 Customer-related 3 7,458 7,458 Distribution network 2 4,027 4,027 In process research and development 7 1,128 1,278 Total Gross Amount $ 54,317 $ 54,467 Less accumulated amortization (30,188 ) (29,747 ) Intangible assets, net $ 24,129 $ 24,720 |
Schedule of intangible assets, future expected amortization expense | Future amortization expense related to intangible assets as of March 31, 2021 is as follows (in thousands) Year Ending December 31, Remainder of 2021 $ 1,552 2022 1,993 2023 1,993 2024 1,890 2025 1,305 Thereafter 15,396 $ 24,129 |
Accrued expenses | Accrued expenses consist of the following (in thousands): March 31, 2021 December 31, 2020 Commissions and sales milestones $ 7,886 $ 6,734 Payroll and payroll related 6,101 12,247 Litigation settlement obligation - short-term portion 4,000 4,000 Professional fees 9,262 3,551 Royalties 2,203 2,293 Interest 88 619 Other 7,190 5,787 Total accrued expenses $ 36,730 $ 35,231 |
Schedule of Other Long-Term Liabilities | Other long-term liabilities consist of the following (in thousands): March 31, 2021 December 31, 2020 Litigation settlement obligation - long-term portion $ 6,721 $ 7,634 Tax liabilities 373 373 Royalties 2,071 1,678 Other 2,124 1,668 Other long-term liabilities $ 11,289 $ 11,353 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Principal Payments on Debt | Principal payments remaining on the Company's debt are as follows as of March 31, 2021 (in thousands): Year Ending December 31, Remainder of 2021 $ 3,800 2022 1,950 2023 6,216 2024 12,018 2025 12,000 Thereafter 20,000 Total 55,984 Add: capital lease principal payments 330 Less: unamortized debt discount and debt issuance costs (12,360 ) Total 43,954 Less: current portion of long-term debt (5,374 ) Long-term debt, net of current portion $ 38,580 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Commitments And Contingencies Disclosure [Abstract] | |
Future minimum annual lease payments | Future minimum annual lease payments under such leases are as follows as of March 31, 2021 (in thousands): Undiscounted lease payments: Year Ending December 31, Remainder of 2021 $ 874 2022 3,534 2023 3,583 2024 3,603 2025 3,662 Thereafter 20,154 Total undiscounted lease payments 35,410 Less: present value adjustment (13,172 ) Operating lease liability 22,238 Less: current portion of operating lease liability (1,486 ) Operating lease liability, less current portion $ 20,752 |
Orthotec Settlement (Tables)
Orthotec Settlement (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Commitments And Contingencies Disclosure [Abstract] | |
Schedule of Reconciliation of Total Net Settlement Obligation | A reconciliation of the total net settlement obligation is as follows (in thousands): March 31, 2021 December 31, 2020 Litigation settlement obligation - short-term portion $ 4,000 $ 4,000 Litigation settlement obligation - long-term portion 6,721 7,634 Total 10,721 11,634 Future interest 1,012 1,199 Total settlement obligation, gross 11,733 12,833 Related party receivable - included in stockholders' equity (2,900 ) (4,000 ) Total settlement obligation, net $ 8,833 $ 8,833 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Net Loss Per Share for Continuing and Discontinued Operations | The following table presents the computation of basic and diluted net loss per share for continuing and discontinued operations (in thousands, except per share amounts): Three Months Ended March 31, 2021 2020 Numerator: Net loss, basic and diluted $ (22,903 ) $ (20,722 ) Denominator: Weighted average common shares outstanding 87,408 62,732 Weighted average unvested common shares subject to repurchase (185 ) (164 ) Weighted average common shares outstanding - basic and diluted 87,223 62,568 Net loss per share, basic and diluted: $ (0.26 ) $ (0.33 ) |
Anti-Dilutive Securities Not Included in Diluted Net Loss Per Share | The anti-dilutive securities not included in diluted net As of March 31, 2021 2020 Series A Convertible Preferred Stock 29 67 Options to purchase common stock 3,898 4,195 Unvested restricted share awards 8,866 6,487 Warrants to purchase common stock 21,594 24,372 Total 34,387 35,121 |
Stock Benefit Plans and Equit_2
Stock Benefit Plans and Equity Transactions (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of Total Stock Based Compensation | Stock-Based Compensation Total stock-based compensation for the three months ended March 31, 2021 were as follows (in thousands): Three Months Ended March 31, 2021 2020 Cost of revenues $ 95 $ 107 Research and development 498 390 Sales, general and administrative 3,881 3,071 Total $ 4,474 $ 3,568 |
Summary of Common Stock Reserved for Future Issuance | As of March 31, 2021, the Company’s shares of common stock reserved for future issuance were as follows (in thousands): Stock options outstanding 3,898 Unvested restricted stock award 8,866 Employee stock purchase plan 216 Series A convertible preferred stock 29 Warrants outstanding 21,594 Authorized for future grant under the Distributor and Development Services plans 7,751 Authorized for future grant under the Management Objective Strategic Incentive Plan 345 Authorized for future grant under the Company equity plans 3,963 Total 46,662 |
Summary of All Outstanding Warrants for Common Stock | A summary of all outstanding warrants for common stock as of March 31, 2021 were as follows: Number of Warrants Strike Price Expiration 2017 PIPE Warrants 2,962,000 $ 2.00 June 2022 2018 PIPE Warrants 9,231,903 $ 3.50 May 2023 SafeOp Surgical Merger Warrants 1,194,943 $ 3.50 May 2023 2018 Squadron Medical Warrants 845,000 $ 3.15 May 2027 2019 Squadron Medical Warrants 4,838,710 $ 2.17 May 2027 2020 Squadron Medical Warrants 1,075,820 $ 4.88 May 2027 Executive Warrants 1,327,434 $ 5.00 December 2022 Other* 117,812 $ 3.85 Various through May 2023 Total 21,593,622 (1) Represents weighted average exercise price. |
The Company and Basis of Pres_2
The Company and Basis of Presentation - Additional Information (Details) - Tender Offer Agreement - EOS Imaging S.A. € / shares in Units, $ / shares in Units, € in Millions, $ in Millions | Dec. 16, 2020USD ($)$ / shares | Mar. 02, 2021USD ($) | Mar. 02, 2021EUR (€) | Dec. 16, 2020€ / shares |
Company And Basis Of Presentation [Line Items] | ||||
Share price | € / shares | € 0.01 | |||
Tender offer price | (per share) | $ 2.99 | 2.45 | ||
Funds transferred to escrow account | $ 115.3 | € 95.6 | ||
Outstanding EOS shares | 23.00% | |||
Maximum | ||||
Company And Basis Of Presentation [Line Items] | ||||
Purchase price | $ | $ 116.9 | |||
OCEANEs | ||||
Company And Basis Of Presentation [Line Items] | ||||
Tender offer price | (per share) | $ 8.55 | € 7.01 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - Recurring - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Assets: | ||
Equity securities | $ 7,619 | |
Debt securities | 1,313 | |
Assets measured at fair value on a recurring basis | 8,932 | |
Liabilities: | ||
Liabilities measured at fair value on a recurring basis | 4,533 | $ 4,986 |
Liability Classified Equity Award | ||
Liabilities: | ||
Liabilities measured at fair value on a recurring basis | 4,533 | 4,108 |
Foreign Currency Forward Contract | ||
Liabilities: | ||
Liabilities measured at fair value on a recurring basis | 878 | |
Level 1 | ||
Assets: | ||
Equity securities | 7,619 | |
Assets measured at fair value on a recurring basis | 7,619 | |
Level 2 | ||
Assets: | ||
Debt securities | 1,313 | |
Assets measured at fair value on a recurring basis | 1,313 | |
Liabilities: | ||
Liabilities measured at fair value on a recurring basis | 878 | |
Level 2 | Foreign Currency Forward Contract | ||
Liabilities: | ||
Liabilities measured at fair value on a recurring basis | 878 | |
Level 3 | ||
Liabilities: | ||
Liabilities measured at fair value on a recurring basis | 4,533 | 4,108 |
Level 3 | Liability Classified Equity Award | ||
Liabilities: | ||
Liabilities measured at fair value on a recurring basis | $ 4,533 | $ 4,108 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Additional Information (Details) € in Millions, $ in Millions | Mar. 02, 2021USD ($) | Mar. 02, 2021EUR (€) | Mar. 31, 2021USD ($)shares | Mar. 31, 2021EUR (€) | Dec. 18, 2020USD ($) | Dec. 18, 2020EUR (€) |
Level 1 | EOS Imaging S.A. | OCEANEs | ||||||
Significant Accounting Policies [Line Items] | ||||||
Equity securities shares purchased | shares | 2,665,694 | |||||
Equity Securities percentage of outstanding shares | 10.00% | |||||
Equity securities | $ 7.6 | € 6.5 | ||||
Equity securities unrealized loss | $ 0.1 | |||||
Level 2 | OCEANEs | ||||||
Significant Accounting Policies [Line Items] | ||||||
Debt securities shares purchased | shares | 157,167 | |||||
Debt securities percentage of outstanding shares | 4.00% | |||||
Debt securities | $ 1.3 | € 1.1 | ||||
Debt securities unrealized loss | $ 0.1 | |||||
Fair value, inputs, level 3 | ||||||
Significant Accounting Policies [Line Items] | ||||||
Notional amount of foreign currency forward contracts | $ 117.9 | € 95.6 | ||||
Foreign currency forward contract settled | $ 115.3 | € 95.6 | ||||
Foreign currency forward contract loss recognized | $ (1.7) | |||||
Vesting period | 4 years | |||||
Fair value of the cash settled award | $ 4.5 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Reconciliation of Liabilities (Details) - Fair value, inputs, level 3 $ in Thousands | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward] | |
Beginning balance | $ 1,668 |
Vested portion of liability classified equity award | 258 |
Change in fair value measurement | 199 |
Ending balance | $ 2,125 |
Select Condensed Consolidated_3
Select Condensed Consolidated Balance Sheet Details - Accounts Receivable, Net (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Balance Sheet Related Disclosures [Abstract] | ||
Accounts receivable | $ 26,121 | $ 23,887 |
Allowance for doubtful accounts | (370) | (360) |
Accounts receivable, net | $ 25,751 | $ 23,527 |
Select Condensed Consolidated_4
Select Condensed Consolidated Balance Sheet Details - Inventories, Net (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Balance Sheet Related Disclosures [Abstract] | ||
Raw materials | $ 6,182 | $ 6,064 |
Work-in-process | 2,303 | 1,982 |
Finished goods | 80,597 | 67,892 |
Inventory, gross, total | 89,082 | 75,938 |
Less reserve for excess and obsolete finished goods | (31,706) | (29,937) |
Inventories, net | $ 57,376 | $ 46,001 |
Select Condensed Consolidated_5
Select Condensed Consolidated Balance Sheet Details - Property and Equipment, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 115,291 | $ 93,316 |
Less accumulated depreciation and amortization | (59,167) | (56,646) |
Property and equipment, net | $ 56,124 | 36,670 |
Surgical instruments | ||
Property, Plant and Equipment [Line Items] | ||
Useful lives | 4 years | |
Property and equipment, gross | $ 94,932 | 76,669 |
Machinery and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Useful lives | 7 years | |
Property and equipment, gross | $ 8,401 | 6,562 |
Computer equipment | ||
Property, Plant and Equipment [Line Items] | ||
Useful lives | 3 years | |
Property and equipment, gross | $ 4,891 | 4,206 |
Office furniture and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Useful lives | 5 years | |
Property and equipment, gross | $ 3,511 | 1,380 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Various useful lives of leasehold improvements | various | |
Property and equipment, gross | $ 1,876 | 1,761 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 1,680 | $ 2,738 |
Select Condensed Consolidated_6
Select Condensed Consolidated Balance Sheet Details - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Property, Plant and Equipment [Line Items] | ||
Depreciation | $ 3.4 | $ 2 |
Amortization of intangible assets | 0.4 | $ 0.4 |
Intellectual Property | ||
Property, Plant and Equipment [Line Items] | ||
Asset impairment loss | $ 0.2 |
Select Condensed Consolidated_7
Select Condensed Consolidated Balance Sheet Details - Intangible Assets, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Finite Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 54,317 | $ 54,467 |
Less accumulated amortization | (30,188) | (29,747) |
Intangible assets, net | $ 24,129 | 24,720 |
Developed product technology | ||
Finite Lived Intangible Assets [Line Items] | ||
Useful lives | 12 years | |
Gross Amount | $ 35,376 | 35,376 |
License agreements | ||
Finite Lived Intangible Assets [Line Items] | ||
Useful lives | 1 year | |
Gross Amount | $ 5,536 | 5,536 |
Trademarks and trade names | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 792 | 792 |
Customer-related | ||
Finite Lived Intangible Assets [Line Items] | ||
Useful lives | 3 years | |
Gross Amount | $ 7,458 | 7,458 |
Distribution network | ||
Finite Lived Intangible Assets [Line Items] | ||
Useful lives | 2 years | |
Gross Amount | $ 4,027 | 4,027 |
In process research and development | ||
Finite Lived Intangible Assets [Line Items] | ||
Useful lives | 7 years | |
Gross Amount | $ 1,128 | $ 1,278 |
Select Condensed Consolidated_8
Select Condensed Consolidated Balance Sheet Details - Schedule of Intangible Assets, Future Expected Amortization Expense (Details) $ in Thousands | Mar. 31, 2021USD ($) |
Balance Sheet Related Disclosures [Abstract] | |
Remainder of 2021 | $ 1,552 |
2022 | 1,993 |
2023 | 1,993 |
2024 | 1,890 |
2025 | 1,305 |
Thereafter | 15,396 |
Total | $ 24,129 |
Select Condensed Consolidated_9
Select Condensed Consolidated Balance Sheet Details - Accrued Expenses (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Balance Sheet Related Disclosures [Abstract] | ||
Commissions and sales milestones | $ 7,886 | $ 6,734 |
Payroll and payroll related | 6,101 | 12,247 |
Litigation settlement obligation - short-term portion | 4,000 | 4,000 |
Professional fees | 9,262 | 3,551 |
Royalties | 2,203 | 2,293 |
Interest | 88 | 619 |
Other | 7,190 | 5,787 |
Total accrued expenses | $ 36,730 | $ 35,231 |
Select Condensed Consolidate_10
Select Condensed Consolidated Balance Sheet Details - Schedule of Other Long-Term Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Balance Sheet Related Disclosures [Abstract] | ||
Litigation settlement obligation - long-term portion | $ 6,721 | $ 7,634 |
Tax liabilities | 373 | 373 |
Royalties | 2,071 | 1,678 |
Other | 2,124 | 1,668 |
Other long-term liabilities | $ 11,289 | $ 11,353 |
Discontinued Operations - Addit
Discontinued Operations - Additional Information (Details) $ in Thousands | Sep. 01, 2016option | Mar. 31, 2021USD ($) | Jun. 30, 2020 | Mar. 31, 2020USD ($) |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Contracts revenue | $ 44,121 | $ 30,115 | ||
Cost of revenues | 12,263 | 9,084 | ||
Supply agreement | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Contracts revenue | 400 | 1,000 | ||
Cost of revenues | $ 500 | $ 1,000 | ||
Discontinued operations, disposed of by sale | International Operations | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Supply commitment term | 3 years | |||
Supply agreement, number of annual options to extend | option | 2 | |||
Supply agreement, extended term | 12 months | |||
Supply agreement, extended period | 2021-08 |
Debt - MidCap Facility Agreemen
Debt - MidCap Facility Agreement (Details) - USD ($) $ in Thousands | May 29, 2020 | Mar. 31, 2020 |
Debt Disclosure [Abstract] | ||
Final settlement under agreement | $ 9,600 | $ 30,408 |
Debt - Squadron Medical Credit
Debt - Squadron Medical Credit Agreement (Details) - USD ($) | Dec. 16, 2020 | Nov. 06, 2018 | Mar. 31, 2021 | Dec. 31, 2020 | May 29, 2020 | Mar. 27, 2019 |
Line Of Credit Facility [Line Items] | ||||||
Issuance of common stock | 84,737,000 | 82,294,000 | ||||
Number of warrants outstanding | 21,593,622 | |||||
Squadron Medical Credit Agreement | ||||||
Line Of Credit Facility [Line Items] | ||||||
Issuance of common stock | 2,700,270 | |||||
Common stock price per share | $ 11.11 | |||||
Additional debt issuance costs | $ 3,800,000 | $ 12,400,000 | ||||
Principal outstanding under term loan | 45,000,000 | |||||
Additional borrowing capacity | 40,000,000 | |||||
New debt issuance costs | 30,000,000 | |||||
Loss on debt extinguishment | $ 6,100,000 | |||||
Debt instrument capitalized non-cash costs | $ 3,800,000 | |||||
Debt carrying amount, net of issuance cost | 32,600,000 | |||||
Debt issuance costs | 3,800,000 | $ 12,400,000 | ||||
Squadron Medical Credit Agreement | Common Stock | Participant Lender | ||||||
Line Of Credit Facility [Line Items] | ||||||
Number of warrants issued (in shares) | 845,000 | 4,838,710 | ||||
Exercise price of warrants | $ 3.15 | $ 4.88 | $ 2.17 | |||
Additional warrants issued | 1,075,820 | |||||
Number of warrants outstanding | 6,759,530 | |||||
Squadron Medical Credit Agreement | Term Loan | ||||||
Line Of Credit Facility [Line Items] | ||||||
Secured debt agreement | $ 30,000,000 | |||||
Squadron Medical Credit Agreement | Line of Credit | ||||||
Line Of Credit Facility [Line Items] | ||||||
Floor on interest rate | 9.00% | |||||
Ceiling on interest rate | 12.00% | |||||
Payment terms | Interest-only payments are due monthly until December 2023 and joined by $1.0 million monthly principal payments beginning December 2023. Any remaining principal amounts of the Term Loan will be due on June 30, 2026. | |||||
Debt instrument, monthly principal payments | $ 1,000,000 | |||||
Line of credit, unused capacity, commitment fee percentage | 1.00% | |||||
Squadron Medical Credit Agreement | Line of Credit | London Interbank Offered Rate (LIBOR) | ||||||
Line Of Credit Facility [Line Items] | ||||||
Interest rate description | LIBOR plus 8.0 | |||||
Basis spread | 8.00% |
Debt - Paycheck Protection Loan
Debt - Paycheck Protection Loan (Details) - USD ($) | Apr. 23, 2020 | Mar. 31, 2021 | Dec. 31, 2020 |
Line Of Credit Facility [Line Items] | |||
Current portion of long-term debt | $ 5,374,000 | $ 4,200,000 | |
Noncurrent portion of long-term debt | $ 38,580,000 | $ 38,034,000 | |
Paycheck Protection Program Loans | |||
Line Of Credit Facility [Line Items] | |||
Proceeds from loan | $ 4,300,000 | ||
Debt instrument, maturity date | Apr. 21, 2022 | ||
Interest rate | 1.00% | ||
Debt instrument, Description | Commencing August 21, 2021, the Company is required to pay the lender equal monthly payments of principal and interest and required to fully amortize by April 21, 2022 the principal amount outstanding on the PPP Loan as of the date prescribed by guidance issued by U.S. Small Business Administration (“SBA”). | ||
Prepayment penalties | $ 0 | ||
Amount of compensation excluded for payroll costs | $ 100,000,000 | ||
Maximum percentage forgiven for non-payroll costs. | 25.00% | ||
Maximum amount of compensation to reduce the forgiveness | $ 100,000,000 | ||
Current portion of long-term debt | $ 3,800,000 | ||
Noncurrent portion of long-term debt | $ 500,000 |
Debt - Inventory Financing Agre
Debt - Inventory Financing Agreement (Details) - Inventory Financing Agreement - USD ($) | 1 Months Ended | 3 Months Ended | |
Nov. 30, 2018 | Mar. 31, 2021 | Nov. 30, 2020 | |
Line Of Credit Facility [Line Items] | |||
Maximum borrowing capacity | $ 3,000,000 | $ 6,000,000 | |
Line of Credit | |||
Line Of Credit Facility [Line Items] | |||
Debt instrument, maturity date | Nov. 6, 2023 | ||
Debt instrument, frequency of periodic payment | monthly | ||
Outstanding obligation under inventory financing agreement | $ 5,100,000 | ||
London Interbank Offered Rate (LIBOR) | Line of Credit | |||
Line Of Credit Facility [Line Items] | |||
Interest rate description | LIBOR plus 8.0% | ||
Basis spread | 8.00% | ||
Floor on interest rate | 10.00% | ||
Ceiling on interest rate | 13.00% |
Debt - Other Debt Agreements (D
Debt - Other Debt Agreements (Details) | 3 Months Ended |
Mar. 31, 2021Agreement | |
Debt Disclosure [Abstract] | |
Capital leases interest percentage | 6.40% |
Number of capital lease agreement | 2 |
Capital leases borrowing interest percentage | 9.00% |
Capital leases borrowing term of maturity | 2024-04 |
Debt - Principal Payments on De
Debt - Principal Payments on Debt (Details) $ in Thousands | Mar. 31, 2021USD ($) |
Debt Disclosure [Abstract] | |
Remainder of 2021 | $ 3,800 |
2022 | 1,950 |
2023 | 6,216 |
2024 | 12,018 |
2025 | 12,000 |
Thereafter | 20,000 |
Total | 55,984 |
Add: capital lease principal payments | 330 |
Less: unamortized debt discount and debt issuance costs | (12,360) |
Total | 43,954 |
Less: current portion of long-term debt | (5,374) |
Long-term debt, net of current portion | $ 38,580 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) | 3 Months Ended | ||
Mar. 31, 2021USD ($)ft² | Mar. 31, 2020USD ($) | Dec. 31, 2020USD ($) | |
Loss Contingencies [Line Items] | |||
Right-of-use asset | $ 21,704,000 | $ 1,177,000 | |
Lease Liability | $ 22,238,000 | ||
Remaining operating lease term | 9 years 7 months 6 days | ||
Weighted average borrowing rate | 9.00% | ||
Rent expense | $ 1,100,000 | $ 300,000 | |
Cash payments related to operating lease | 400,000 | 400,000 | |
Liability in connection with lawsuit | 0 | ||
Alphatec Spine, Inc. | |||
Loss Contingencies [Line Items] | |||
Guaranteed obligated minimum royalty payments through 2026 and beyond | 4,700,000 | ||
Third-party Provider | |||
Loss Contingencies [Line Items] | |||
Minimum purchase commitment requirements | $ 2,600,000 | ||
Minimum purchase commitment to be paid period | 3 years | ||
Recognized an ROU asset related to agreement amount | $ 500,000 | ||
Rent expense pertaining to assets | 100,000 | $ 0 | |
Leased assets within agreement | $ 500,000 | ||
Building lease | |||
Loss Contingencies [Line Items] | |||
Area for facility of office, engineering and research and development space | ft² | 121,541 | ||
Lease agreement commencement date | Feb. 1, 2021 | ||
Lease agreement expiry date | Jan. 31, 2031 | ||
Lease renewal term | 260 months | ||
Right-of-use asset | $ 21,100,000 | ||
Lease Liability | $ 21,500,000 | ||
Operating lease discount rate | 9.00% | ||
Annual increase in base rent | 3.00% | ||
Building lease | First year | |||
Loss Contingencies [Line Items] | |||
Lease base rent payment per month | $ 195,000 | ||
Building lease | Second year | |||
Loss Contingencies [Line Items] | |||
Lease base rent payment per month | $ 244,115 | ||
Minimum [Member] | |||
Loss Contingencies [Line Items] | |||
Operating lease term | 1 year | ||
Minimum [Member] | Building lease | First year | |||
Loss Contingencies [Line Items] | |||
Abatement Period | 2 months | ||
Maximum | |||
Loss Contingencies [Line Items] | |||
Operating lease term | 10 years | ||
Maximum | Building lease | First year | |||
Loss Contingencies [Line Items] | |||
Abatement Period | 10 months |
Commitments and Contingencies_2
Commitments and Contingencies - Future Minimum Annual Lease Payments (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Commitments And Contingencies Disclosure [Abstract] | ||
Remainder of 2021 | $ 874 | |
2022 | 3,534 | |
2023 | 3,583 | |
2024 | 3,603 | |
2025 | 3,662 | |
Thereafter | 20,154 | |
Total undiscounted lease payments | 35,410 | |
Less: present value adjustment | (13,172) | |
Operating lease liability | 22,238 | |
Less: current portion of operating lease liability | (1,486) | $ (885) |
Operating lease liability, less current portion | $ 20,752 | $ 41 |
Orthotec Settlement - Additiona
Orthotec Settlement - Additional Information (Details) | Jul. 01, 2016USD ($) | Oct. 01, 2014USD ($) | Aug. 13, 2014USD ($)installment | Oct. 31, 2020USD ($)installment | Sep. 30, 2014USD ($) | Apr. 30, 2014USD ($) | Mar. 31, 2014USD ($) | Mar. 31, 2021USD ($)installment |
Loss Contingencies [Line Items] | ||||||||
Litigation settlement, remaining outstanding balance including interest | $ 0 | |||||||
Orthotec LLC, litigation settlement | ||||||||
Loss Contingencies [Line Items] | ||||||||
Judgment assessed by court for (against) company | $ 49,000,000 | |||||||
Payments of settlement | $ 15,750,000 | $ 1,750,000 | $ 46,100,000 | |||||
Number of quarterly installments | installment | 28 | 5 | ||||||
Litigation settlement interest, quarterly installments, amount | $ 1,100,000 | |||||||
Litigation settlement, final installment amount | 700,000 | |||||||
Litigation settlement, remaining outstanding balance including interest | $ 11,700,000 | |||||||
Orthotec LLC, litigation settlement | HealthpointCapital, LLC | ||||||||
Loss Contingencies [Line Items] | ||||||||
Judgment assessed by court for (against) company | $ 5,000,000 | $ 5,000,000 | ||||||
Payments of settlement | $ 1,000,000 | 1,100,000 | ||||||
Number of quarterly installments | installment | 5 | |||||||
Contribution amount to be paid by other party | $ 5,000,000 | $ 5,000,000 | ||||||
Remaining receivable | $ 2,900,000 | |||||||
Beginning Fourth Quarter of 2014 | Orthotec LLC, litigation settlement | ||||||||
Loss Contingencies [Line Items] | ||||||||
Litigation settlement, full amount to be paid in quarterly installments | $ 31,500,000 | |||||||
Litigation settlement interest, quarterly installments, amount | $ 1,100,000 | |||||||
Litigation settlement interest rate | 7.00% | |||||||
Litigation settlement payments, quarterly payment amount | $ 1,100,000 | |||||||
Final Installment | Orthotec LLC, litigation settlement | ||||||||
Loss Contingencies [Line Items] | ||||||||
Number of quarterly installments | installment | 1 |
Orthotec Settlement - Schedule
Orthotec Settlement - Schedule of Reconciliation of Total Net Settlement Obligation (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Commitments And Contingencies Disclosure [Abstract] | ||
Litigation settlement obligation - short-term portion | $ 4,000 | $ 4,000 |
Litigation settlement obligation - long-term portion | 6,721 | 7,634 |
Total | 10,721 | 11,634 |
Future interest | 1,012 | 1,199 |
Total settlement obligation, gross | 11,733 | 12,833 |
Related party receivable - included in stockholders' equity | (2,900) | (4,000) |
Total settlement obligation, net | $ 8,833 | $ 8,833 |
Net Loss Per Share - Computatio
Net Loss Per Share - Computation of Basic and Diluted Net Loss Per Share for Continuing and Discontinued Operations (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Numerator: | ||
Net loss, basic and diluted | $ (22,903) | $ (20,722) |
Denominator: | ||
Weighted average common shares outstanding | 87,408 | 62,732 |
Weighted average unvested common shares subject to repurchase | (185) | (164) |
Weighted average common shares outstanding - basic and diluted | 87,223 | 62,568 |
Net loss per share, basic and diluted: | $ (0.26) | $ (0.33) |
Net Loss Per Share - Anti-Dilut
Net Loss Per Share - Anti-Dilutive Securities Not Included in Diluted Net Loss Per Share (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive securities not included in diluted net loss per share (in shares) | 34,387 | 35,121 |
Options to purchase common stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive securities not included in diluted net loss per share (in shares) | 3,898 | 4,195 |
Unvested restricted share awards | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive securities not included in diluted net loss per share (in shares) | 8,866 | 6,487 |
Warrants to purchase common stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive securities not included in diluted net loss per share (in shares) | 21,594 | 24,372 |
Series A Convertible Preferred Stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive securities not included in diluted net loss per share (in shares) | 29 | 67 |
Stock Benefit Plans and Equit_3
Stock Benefit Plans and Equity Transactions - Additional Information (Details) - USD ($) | Dec. 16, 2020 | Jul. 31, 2019 | Dec. 31, 2017 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2017 | Jun. 17, 2020 | May 09, 2020 | Apr. 08, 2020 | Jun. 30, 2019 | Dec. 31, 2018 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Warrants outstanding | 21,593,622 | ||||||||||
Stock-based compensation | $ 4,474,000 | $ 3,568,000 | |||||||||
Mr. Miles | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Warrant expiration period | 5 years | ||||||||||
Number of warrants exercised | 0 | ||||||||||
Number of warrants issued (in shares) | 1,327,434 | 1,327,434 | |||||||||
Exercise price of warrants | $ 5 | $ 5 | |||||||||
Stock-based compensation | $ 1,400,000 | ||||||||||
Safe Op Surgical Inc | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Proceeds from exercise of warrant | $ 100,000 | $ 0 | |||||||||
Number of warrants exercised | 969,932 | 0 | |||||||||
Warrants outstanding | 1,194,943 | ||||||||||
Number of warrants issued (in shares) | 2,200,000 | ||||||||||
Exercise price of warrants | $ 3.50 | ||||||||||
2017 PIPE Warrants | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Warrant expiration period | 5 years | ||||||||||
Proceeds from exercise of warrant | $ 300,000 | $ 300,000 | |||||||||
Number of warrants exercised | 145,000 | 125,000 | |||||||||
Warrants outstanding | 2,962,000 | ||||||||||
Exercise price of warrants | $ 2 | ||||||||||
2018 Common Stock Warrants | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Warrant expiration period | 5 years | ||||||||||
Proceeds from exercise of warrant | $ 300,000 | $ 900,000 | |||||||||
Number of warrants exercised | 2,147,782 | 2,059,524 | |||||||||
Warrants outstanding | 9,231,903 | ||||||||||
Exercise price of warrants | $ 3.50 | ||||||||||
Squadron Medical | Participant Lender | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Warrants outstanding | 0 | 6,759,530 | |||||||||
Number of warrants issued (in shares) | 1,075,820 | 4,838,710 | 845,000 | ||||||||
Exercise price of warrants | $ 4.88 | $ 2.17 | $ 3.15 | ||||||||
Warrants And Rights Outstanding Maturity Date | May 29, 2027 | ||||||||||
Private Placement | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Common stock issued | 12,421,242 | ||||||||||
Purchase price per share | $ 11.11 | ||||||||||
Gross proceeds for private placement | $ 138,000,000 | ||||||||||
Net proceeds for private placement | $ 131,800,000 | ||||||||||
Interest percentage on purchase price | 9.00% | ||||||||||
ESPP | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Number of shares available for grant | 216,131 | ||||||||||
2016 Equity Incentive Plan | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Number of shares available for grant | 3,101,477 | 7,000,000 | |||||||||
2017 Distributor Inducement Plan | Common Stock | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Common stock issued | 64,500 | ||||||||||
Stock-based compensation | $ 100,000 | $ 100,000 | |||||||||
Number of warrants available to be granted | 525,000 | ||||||||||
2017 Distributor Inducement Plan | Board of Directors Chairman | Common Stock | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Share authorized grant of common stock | 1,000,000 | 1,000,000 | |||||||||
2017 Distributor Inducement Plan | Restricted Common Stock | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Number of warrants available to be granted | 185,000 | ||||||||||
Restricted shares granted under the plan | 284,500 | ||||||||||
2017 Development Services Plan | Board of Directors Chairman | Common Stock | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Number of shares available for grant | 7,000,000 | ||||||||||
Common stock issued | 0 | ||||||||||
2017 Development Services Plan | Restricted Common Stock | Board of Directors Chairman | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Number of shares available for grant | 6,649,000 | ||||||||||
Restricted shares granted under the plan | 3,340,000 | ||||||||||
2019 Management Objective Strategic Incentive Plan | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Stock-based compensation | $ 100,000 | ||||||||||
2019 Management Objective Strategic Incentive Plan | Board of Directors Chairman | Common Stock | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Share authorized grant of common stock | 500,000 | ||||||||||
Maximum grant of shares per participant | 50,000 | ||||||||||
2019 Management Objective Strategic Incentive Plan | Unvested Restricted Stock Award | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Restricted shares granted under the plan | 130,000 | ||||||||||
2019 Management Objective Strategic Incentive Plan | Unvested Restricted Stock Award | Common Stock | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Number of common stock shares available for purchase under the plan | 25,000 |
Stock Benefit Plans and Equit_4
Stock Benefit Plans and Equity Transactions - Summary of Total Stock Based Compensation (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total stock-based compensation | $ 4,474 | $ 3,568 |
Cost of revenues | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total stock-based compensation | 95 | 107 |
Research and development | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total stock-based compensation | 498 | 390 |
Sales, general and administrative | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total stock-based compensation | $ 3,881 | $ 3,071 |
Stock Benefit Plans and Equit_5
Stock Benefit Plans and Equity Transactions - Summary Common Stock Reserved for Future Issuance (Details) shares in Thousands | Mar. 31, 2021shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Common stock reserved for future issuance | 46,662 |
Stock Options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Common stock reserved for future issuance | 3,898 |
Unvested Restricted Stock Award | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Common stock reserved for future issuance | 8,866 |
Employee Stock Purchase Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Common stock reserved for future issuance | 216 |
Series A Convertible Preferred Stock | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Common stock reserved for future issuance | 29 |
Warrants Outstanding | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Common stock reserved for future issuance | 21,594 |
Authorized for Future Grant Under the Distributor and Development Services Plans | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Common stock reserved for future issuance | 7,751 |
Authorized for Future Grant Under the Management Objective Strategic Incentive Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Common stock reserved for future issuance | 345 |
Authorized for Future Grant Under the Company Equity Plans | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Common stock reserved for future issuance | 3,963 |
Stock Benefit Plans and Equit_6
Stock Benefit Plans and Equity Transactions - Summary of All Outstanding Warrants for Common Stock (Details) | 3 Months Ended |
Mar. 31, 2021$ / sharesshares | |
Class Of Warrant Or Right [Line Items] | |
Number of Warrants | 21,593,622 |
2017 PIPE Warrants | |
Class Of Warrant Or Right [Line Items] | |
Number of Warrants | 2,962,000 |
Strike Price | $ / shares | $ 2 |
Expiration | June 2022 |
2018 PIPE Warrants | |
Class Of Warrant Or Right [Line Items] | |
Number of Warrants | 9,231,903 |
Strike Price | $ / shares | $ 3.50 |
Expiration | May 2023 |
SafeOp Surgical Merger Warrants | |
Class Of Warrant Or Right [Line Items] | |
Number of Warrants | 1,194,943 |
Strike Price | $ / shares | $ 3.50 |
Expiration | May 2023 |
2018 Squadron Medical Warrants | |
Class Of Warrant Or Right [Line Items] | |
Number of Warrants | 845,000 |
Strike Price | $ / shares | $ 3.15 |
Expiration | May 2027 |
2019 Squadron Medical Warrants | |
Class Of Warrant Or Right [Line Items] | |
Number of Warrants | 4,838,710 |
Strike Price | $ / shares | $ 2.17 |
Expiration | May 2027 |
2020 Squadron Medical Warrants | |
Class Of Warrant Or Right [Line Items] | |
Number of Warrants | 1,075,820 |
Strike Price | $ / shares | $ 4.88 |
Expiration | May 2027 |
Executive Warrants | |
Class Of Warrant Or Right [Line Items] | |
Number of Warrants | 1,327,434 |
Strike Price | $ / shares | $ 5 |
Expiration | December 2022 |
Other Warrants | |
Class Of Warrant Or Right [Line Items] | |
Number of Warrants | 117,812 |
Strike Price | $ / shares | $ 3.85 |
Expiration | Various through May 2023 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | ||
Effective income tax rate from continuing operations | (0.22%) | |
Federal statutory income tax rate | 21.00% | |
Unrecognized tax benefits | $ 2.5 | |
Operating loss carryforwards state | 193.4 | |
Operating loss carryforwards federal | $ 273.7 | |
Federal and state net operating loss carryforwards, beginning expiring year | 2021 | |
Federal and state net operating loss carryforwards, ending expiring year | 2040 | |
State research and development tax credit carryforwards | $ 3.2 | |
Cumulative change in ownership percentage | 50.00% | |
Period for cumulative change in ownership | 3 years |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) $ in Thousands | Jul. 01, 2016USD ($) | Aug. 13, 2014USD ($)installment | Oct. 31, 2020USD ($)installment | Sep. 30, 2014USD ($) | Apr. 30, 2014USD ($) | Mar. 31, 2014USD ($) | Mar. 31, 2021USD ($)installment | Dec. 31, 2020USD ($) |
Related Party Transaction [Line Items] | ||||||||
Remaining settlement amount to be contributed | $ 2,900 | $ 4,000 | ||||||
Withholding tax receivable from officer | 1,076 | $ 1,076 | ||||||
Restricted Stock Unit | ||||||||
Related Party Transaction [Line Items] | ||||||||
Withholding tax receivable from officer | 1,100 | |||||||
Orthotec LLC, litigation settlement | ||||||||
Related Party Transaction [Line Items] | ||||||||
Payments of settlement | $ 15,750 | $ 1,750 | $ 46,100 | |||||
Judgment assessed by court for (against) company | $ (49,000) | |||||||
Number of quarterly installments | installment | 28 | 5 | ||||||
Orthotec LLC, litigation settlement | HealthpointCapital, LLC | ||||||||
Related Party Transaction [Line Items] | ||||||||
Payments of settlement | $ 1,000 | $ 1,100 | ||||||
Judgment assessed by court for (against) company | $ (5,000) | $ (5,000) | ||||||
Number of quarterly installments | installment | 5 | |||||||
Remaining settlement amount to be contributed | $ 2,900 |
Subsequent Event - Additional I
Subsequent Event - Additional Information (Details) € in Millions | May 03, 2021USD ($)shares | Apr. 09, 2021USD ($)ft² | Apr. 01, 2021USD ($)Day | Mar. 31, 2021USD ($)ft² | May 03, 2021EUR (€) |
Building lease | |||||
Subsequent Event [Line Items] | |||||
Area for facility of office, engineering and research and development space | ft² | 121,541 | ||||
Lease agreement commencement date | Feb. 1, 2021 | ||||
Lease agreement expiry date | Jan. 31, 2031 | ||||
Lease renewal term | 260 months | ||||
Annual increase in base rent | 3.00% | ||||
First year | Building lease | |||||
Subsequent Event [Line Items] | |||||
Lease base rent payment per month | $ 195,000 | ||||
Subsequent Event | EOS Imaging S.A. | |||||
Subsequent Event [Line Items] | |||||
Initial acceptance euronext paris trading days | Day | 25 | ||||
Additional euronext paris trading days | Day | 10 | ||||
Common stock issued | shares | 7,433,387 | ||||
Outstanding EOS shares | 28.00% | ||||
Outstanding shares amount | $ 21,900,000 | € 18.2 | |||
Subsequent Event | EOS Imaging S.A. | Maximum | |||||
Subsequent Event [Line Items] | |||||
Purchase price | $ 116,900,000 | ||||
Subsequent Event | EOS Imaging S.A. | OCEANEs | |||||
Subsequent Event [Line Items] | |||||
Common stock issued | shares | 174,061 | ||||
Outstanding EOS shares | 4.00% | ||||
Outstanding shares amount | $ 1,500,000 | € 1.2 | |||
Subsequent Event | Building lease | |||||
Subsequent Event [Line Items] | |||||
Area for facility of office, engineering and research and development space | ft² | 75,643 | ||||
Lease agreement commencement date | May 1, 2021 | ||||
Lease agreement expiry date | May 1, 2028 | ||||
Lease renewal term | 236 months | ||||
Expected date of proportionate share of building upon commencement lease | May 1, 2021 | ||||
Expected percentage to occupy lease premises | 100.00% | ||||
Annual increase in base rent | 3.00% | ||||
Subsequent Event | First year | Building lease | |||||
Subsequent Event [Line Items] | |||||
Lease base rent payment per month | $ 14,667 | ||||
Subsequent Event | First Six-months of Second-year | Building lease | |||||
Subsequent Event [Line Items] | |||||
Lease base rent payment per month | 18,792 | ||||
Subsequent Event | Final Six-months of Second year | Building lease | |||||
Subsequent Event [Line Items] | |||||
Lease base rent payment per month | $ 28,426 |