Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2017 | May 15, 2017 | |
Document And Entity Information | ||
Entity Registrant Name | CareView Communications Inc | |
Entity Central Index Key | 1,377,149 | |
Document Type | 10-Q | |
Trading Symbol | CRVW | |
Document Period End Date | Mar. 31, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity a Well-known Seasoned Issuer | No | |
Entity a Voluntary Filer | No | |
Entity's Reporting Status Current | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 139,380,748 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2,017 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Current Assets: | ||
Cash and cash equivalents | $ 7,827,332 | $ 10,088,258 |
Accounts receivable, net | 1,133,598 | 1,069,304 |
Other current assets | 355,502 | 114,717 |
Total current assets | 9,316,432 | 11,272,279 |
Property and equipment, net | 3,825,360 | 4,152,414 |
Other Assets: | ||
Restricted cash | 3,250,000 | 3,250,000 |
Intangible assets, net | 615,789 | 612,337 |
Other assets | 2,051,814 | 2,168,894 |
Total other assets | 5,917,603 | 6,031,231 |
Total assets | 19,059,395 | 21,455,924 |
Current Liabilities: | ||
Accounts payable | 336,899 | 195,472 |
Current portion of long term note payable | 400,000 | |
Notes payable | 439,173 | |
Mandatorily redeemable equity in joint venture | 439,173 | |
Accrued interest | 328,979 | |
Other current liabilities | 535,316 | 485,221 |
Total current liabilities | 1,272,215 | 1,888,018 |
Long-term Liabilities: | ||
Senior secured convertible notes, net of debt discount and debt costs of $20,577,947 and $21,267,829, respectively | 44,663,067 | 42,271,224 |
Loan payable | 20,000,000 | 20,000,000 |
Note payable | 613,786 | |
Accrued interest | 9,289 | |
Fair value of warrant liability | 629 | 629 |
Total long-term liabilities | 65,286,771 | 62,271,853 |
Total liabilities | 66,558,986 | 64,159,871 |
Commitments and Contingencies | ||
Stockholders' Deficit: | ||
Preferred stock - par value $0.001; 20,000,000 shares authorized; no shares issued and outstanding | ||
Common stock - par value $0.001; 300,000,000 shares authorized; 139,380,748 issued and outstanding | 139,381 | 139,381 |
Additional paid in capital | 84,332,236 | 84,119,834 |
Accumulated deficit | (131,971,208) | (126,408,409) |
Total CareView Communications Inc. stockholders' deficit | (47,499,591) | (42,149,194) |
Noncontrolling interest | (554,753) | |
Total stockholders' deficit | (47,499,591) | (42,703,947) |
Total liabilities and stockholders' deficit | $ 19,059,395 | $ 21,455,924 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common stock, shares issued | 139,380,748 | 139,380,748 |
Common stock, shares outstanding | 139,380,748 | 139,380,748 |
2011 Senior Secured Convertible Note#1 [Member] | ||
Debt discount and debt issuance costs (in dollars) | $ 20,577,947 | $ 21,267,829 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Income Statement [Abstract] | ||
Revenues, net | $ 1,497,693 | $ 1,495,793 |
Operating expenses: | ||
Network operations | 1,153,448 | 1,152,107 |
General and administration | 1,083,022 | 1,054,858 |
Sales and marketing | 193,722 | 221,688 |
Research and development | 410,229 | 249,098 |
Depreciation and amortization | 453,682 | 445,416 |
Total operating expense | 3,294,103 | 3,123,167 |
Operating loss | (1,796,410) | (1,627,374) |
Other income and (expense) | ||
Interest expense | (3,220,762) | (3,151,557) |
Change in fair value of warrant liability | 84,497 | |
Interest income | 3,014 | 4,970 |
Other income | 6,112 | 5,120 |
Total other income (expense) | (3,211,636) | (3,056,970) |
Loss before taxes | (5,008,046) | (4,684,344) |
Net loss | (5,008,046) | (4,684,344) |
Net loss attributable to noncontrolling interest | (16,110) | |
Net loss attributable to CareView Communications, Inc. | $ (5,008,046) | $ (4,668,234) |
Net loss per share attributable to CareView Communications, Inc., basic and diluted (in dollars per share) | $ (0.04) | $ (0.03) |
Weighted average number of common shares outstanding, basic and diluted (in shares) | 139,380,748 | 139,380,748 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
CASH FLOWS FROM OPERATING ACTIVITES | ||
Net loss | $ (5,008,046) | $ (4,684,344) |
Adjustments to reconcile net loss to net cash flows used in operating activities: | ||
Depreciation | 443,246 | 423,560 |
Amortization of debt discount and debt costs | 753,468 | 607,138 |
Amortization of deferred installation costs | 76,634 | 102,541 |
Amortization of deferred debt issuance and debt financing costs | 72,771 | 72,772 |
Amortization of intangible assets | 10,436 | 21,856 |
Interest incurred and paid in kind | 1,701,961 | 1,774,076 |
Stock based compensation related to options granted | 120,376 | 190,843 |
Stock based costs related to warrants issued | 11,512 | |
Change in fair value of warrant liability | (84,497) | |
Changes in operating assets and liabilities: | ||
Accounts receivable | (64,294) | (8,728) |
Other current assets | (240,785) | (18,929) |
Other assets | 4,098 | 4,098 |
Accounts payable | 141,427 | 54,901 |
Accrued expenses and other current liabilities | 65,845 | 121,875 |
Net cash flows used in operating activities | (1,911,351) | (1,422,838) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchase of property and equipment | (99,264) | (474,838) |
Payment for deferred installation costs | (36,423) | (37,935) |
Patent and trademark costs | (13,888) | (174,785) |
Net cash flows used in investing activities | (149,575) | (687,558) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Repayment of notes payable | (200,000) | |
Net cash flows provided by financing activities | (200,000) | |
Decrease in cash | (2,260,926) | (2,110,396) |
Cash and cash equivalent, beginning of period | 10,088,258 | 17,678,969 |
Cash and cash equivalents, end of period | 7,827,332 | 15,568,573 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: | ||
Cash paid for interest | 676,000 | 682,150 |
SUPPLEMENTAL SCHEDULE OF NON-CASH FINANCING ACTIVITIES: | ||
Beneficial conversion features for senior secured convertible notes | $ 63,586 | $ 516,844 |
BASIS OF PRESENTATION AND RECEN
BASIS OF PRESENTATION AND RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS | 3 Months Ended |
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF PRESENTATION AND RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS | NOTE 1 – BASIS OF PRESENTATION AND RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS Interim Financial Statements The accompanying unaudited interim condensed consolidated financial statements of CareView Communications, Inc. (“CareView”, the “Company”, “we”, “us” or “our”) have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, such financial statements include all adjustments (consisting solely of normal recurring adjustments) necessary for the fair statement of the financial information included herein in accordance with GAAP and the rules and regulations of the Securities and Exchange Commission (the “SEC”). The balance sheet at December 31, 2016 has been derived from the audited consolidated financial statements at that date but does not include all of the information and footnotes required by GAAP for complete financial statements. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the period. Actual results could differ from those estimates. Results of operations for interim periods are not necessarily indicative of results for the full year. The accompanying condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2016 as filed with the SEC on March 31, 2017. Earnings Per Share We calculate earnings per share (“EPS”) in accordance with GAAP, which requires the computation and disclosure of two EPS amounts, basic and diluted. Basic EPS is computed based on the weighted average number of shares of common stock outstanding during the period. Diluted EPS is computed based on the weighted average number of common shares outstanding plus all potentially dilutive common shares outstanding during the period under the treasury stock method. Such potential dilutive common shares consist of stock options, warrants and convertible debt. Potential common shares totaling approximately 124,000,000 and 110,000,000 at March 31, 2017 and 2016, respectively, have been excluded from the diluted earnings per share calculation as they are anti-dilutive due to our reported net loss. Recently Issued and Newly Adopted Accounting Pronouncements There have been no material changes to our significant accounting policies as summarized in NOTE 2 of our Annual Report on Form 10-K for the year ended December 31, 2016 not expect that the adoption of any recent accounting pronouncements will have a material impact on our accompanying condensed consolidated financial statements. |
LIQUIDITY AND MANAGEMENT'S PLAN
LIQUIDITY AND MANAGEMENT'S PLAN | 3 Months Ended |
Mar. 31, 2017 | |
Liquidity And Managements Plan | |
LIQUIDITY AND MANAGMENT'S PLAN | NOTE 2 – LIQUIDITY AND MANAGEMENT’S PLAN Our cash position at March 31, 2017 was approximately $7,800,000. We also have $3,250,000 recorded as restricted cash related to a debt covenant in our credit agreement with PDL BioPharma, Inc. as discussed below. Pursuant to the terms of a Note and Warrant Purchase Agreement dated April 21, 2011 (as subsequently amended) with HealthCor Partners Fund, LP and HealthCor Hybrid Offshore Master Fund, LP (“HealthCor”) we are required to maintain a minimum cash balance $2,000,000 (see NOTE 11 Our continued successful operation is dependent upon us achieving positive cash flow through operations while maintaining adequate liquidity. We expect that the cash on hand, as well as our existing and projected cash flow from billable contracts, will enable us to continue to operate for the next twelve month period. We believe that our sales and marketing plan to attract new business and our ongoing deployment and installation of units under existing hospital agreements, will meet our near-term cash needs and will help us achieve future operating profitability. At present, we have sufficient inventory to install and service a select number of large customers, but eventually we will need to address additional capital requirements. To that end, on June 26, 2015, we entered into a Credit Agreement with PDL Biopharma, Inc., as administrative agent and lender (“the Lender”), (the “PDL Credit Agreement”) pursuant to which the Lender made available to us up to $40 million in two tranches of $20 million each, with each tranche contingent upon us meeting certain milestones. On October 7, 2015, pursuant to the First Amendment to the PDL Credit Agreement (the “First Amendment”) the Lender made the first tranche of $20 million available and funded us $19,533,992, net of fees. As of March 31, 2017, we are including $20 million in long-term liabilities on the accompanying condensed consolidated financial statements. Pursuant to the terms of the PDL Credit Agreement, we are required to maintain a minimum cash balance $3,250,000, and we are in compliance with the minimum cash balance as of the date of this filing (see NOTE 12 |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 3 Months Ended |
Mar. 31, 2017 | |
Stockholders' Equity Note [Abstract] | |
STOCKHOLDERS' EQUITY | NOTE 3 – STOCKHOLDERS’ EQUITY Warrants to Purchase Common Stock of the Company We use the Black-Scholes-Merton option pricing model (“Black-Scholes Model”) to determine the fair value of warrants to purchase Common Stock of the Company (“Warrants”) (except certain Warrants issued to HealthCor in 2011 as discussed in NOTE 11 NOTE 11, The risk-free interest rate assumption is based upon observed interest rates on zero coupon U.S. Treasury bonds whose maturity period is appropriate for the term of the Warrants and is calculated by using the average daily historical stock prices through the day preceding the grant date. Estimated volatility is a measure of the amount by which our stock price is expected to fluctuate each year during the expected life of the award. Our estimated volatility is an average of the historical volatility of our stock prices (and that of peer entities whose stock prices were publicly available) over a period equal to the expected life of the awards. Where appropriate we used the historical volatility of peer entities due to the lack of sufficient historical data of our stock price during 2007-2009. Warrant Activity during the Three Months Ended March 31, 2017 During the three months ended March 31, 2017, no Warrants were issued and none were exercised or expired. As of March 31, 2017 and December 31, 2016, we recorded a warrant liability of $629 in our consolidated financial statements. Warrant Activity during the Three Months Ended March 31, 2016 During the three months ended March 31, 2016, no Warrants were issued and none were exercised or expired. As of December 31, 2015, we recorded a warrant liability of $168,805 in our consolidated financial statements. At March 31, 2016, the Private Placement Warrants were re-valued with a fair value determination of $84,308, resulting in a difference of $84,497, which was included as change in fair value of warrant liability in other income and expense in the accompanying condensed consolidated financial statements. Options to Purchase Common Stock of the Company During the three months ended March 31, 2017, we granted options to purchase 20,000 shares of our Common Stock (the ‘‘Option(s)’’) to an employee. During those same three month period, 74,165 Options were canceled. A summary of our stock option activity and related information follows: Number of Weighted Weighted Aggregate Balance at December 31, 2016 15,910,975 $ 0.37 8.0 $ — Granted 20,000 $ 0.09 $ — Canceled (74,165 ) Balance at March 31, 2017 15,856,810 $ 0.37 7.8 $ 13,315 Vested and Exercisable at March 31, 2017 7,818,514 $ 0.59 $ — The valuation methodology used to determine the fair value of the Options issued was the Black-Scholes Model. The assumptions used in the Black-Scholes Model are set forth in the table below. Three Months Ended March 31, 2017 Year Ended December 31, 2016 Risk-free interest rate 1.99 % 1.13-1.84 % Volatility 78.40 % 63.49-73.73 % Expected life in years 6 6 Dividend yield 0.00 % 0.00 % The risk-free interest rate assumption is based upon observed interest rates on zero coupon U.S. Treasury bonds whose maturity period is appropriate for the expected term of the Option and is calculated by using the average daily historical stock prices through the day preceding the grant date. Estimated volatility is a measure of the amount by which our stock price is expected to fluctuate each year during the expected life of the award. Our estimated volatility is an average of the historical volatility of our stock prices. Our calculation of estimated volatility is based on historical stock prices over a period equal to the expected life of the awards. Share-based compensation expense for Options charged to our operating results for the three months ended March 31, 2017 and 2016 ($120,376 and $190,843, respectively) is based on awards vested. The estimate of forfeitures are to be recorded at the time of grant and revised in subsequent periods if actual forfeitures differ from the estimates. We have not included an adjustment to our stock based compensation expense based on the nominal amount of the historical forfeiture rate. We do, however, revise our stock based compensation expense based on actual forfeitures during each reporting period. At March 31, 2017, total unrecognized estimated compensation expense related to non-vested Options granted prior to that date was approximately $842,000, which is expected to be recognized over a weighted-average period of 1.5 years. No tax benefit was realized due to a continued pattern of operating losses. |
OTHER CURRENT ASSETS
OTHER CURRENT ASSETS | 3 Months Ended |
Mar. 31, 2017 | |
Other Current Assets | |
OTHER CURRENT ASSETS | NOTE 4 – OTHER CURRENT ASSETS Other current assets consist of the following: March 31, 2017 December 31, Prepaid equipment $ 167,597 $ 40,269 Prepaid insurance 150,444 39,343 Other prepaid expense 30,201 20,489 Other current assets 7,260 14,616 TOTAL OTHER CURRENT ASSETS $ 355,502 $ 114,717 |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 3 Months Ended |
Mar. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | NOTE 5 – PROPERTY AND EQUIPMENT Property and equipment consist of the following: March 31, 2017 December 31, Network equipment $ 12,856,069 $ 12,632,559 Office equipment 250,080 243,267 Vehicles 161,584 161,584 Test equipment 172,985 166,484 Furniture 90,244 87,646 Warehouse equipment 9,524 9,524 Leasehold improvements 5,121 5,121 13,545,607 13,306,185 Less: accumulated depreciation (9,720,247 ) (9,153,771 ) TOTAL PROPERTY AND EQUIPMENT $ 3,825,360 $ 4,152,414 Depreciation expense for the three months ended March 31, 2017 and 2016 was $443,246 and $423,560, respectively. |
OTHER ASSETS
OTHER ASSETS | 3 Months Ended |
Mar. 31, 2017 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
OTHER ASSETS | NOTE 6 – OTHER ASSETS Intangible assets consist of the following: March 31, 2017 Cost Accumulated Amortization Net Patents and trademarks $ 725,850 $ 113,480 $ 612,370 Other intangible assets 53,087 49,668 3,419 TOTAL INTANGIBLE ASSETS $ 778,937 $ 163,148 $ 615,789 December 31, 2016 Cost Accumulated Amortization Net Patents and trademarks $ 711,961 $ 104,574 $ 607,387 Other intangible assets 53,088 48,138 4,950 TOTAL INTANGIBLE ASSETS $ 765,049 $ 152,712 $ 612,337 Other assets consist of the following: March 31, 2017 Cost Accumulated Amortization Net Deferred debt issuance costs $ 1,257,778 $ 316,450 $ 941,328 Prepaid financing costs 805,917 213,315 592,602 Deferred installation costs 1,618,482 1,305,192 313,290 Prepaid license fee 249,999 91,529 158,470 Security deposit 46,124 — 46,124 TOTAL OTHER ASSETS $ 3,978,300 $ 1,926,486 $ 2,051,814 Other assets consist of the following: December 31, 2016 Cost Accumulated Amortization Net Deferred debt issuance costs $ 1,257,778 $ 271,528 $ 986,250 Deferred financing costs 805,917 185,466 620,451 Deferred installation costs 1,582,059 1,228,558 353,501 Prepaid license fee 249,999 87,431 162,568 Security deposit 46,124 — 46,124 TOTAL OTHER ASSETS $ 3,941,877 $ 1,772,983 $ 2,168,894 |
OTHER CURRENT LIABILITIES
OTHER CURRENT LIABILITIES | 3 Months Ended |
Mar. 31, 2017 | |
Payables and Accruals [Abstract] | |
OTHER CURRENT LIABILITIES | NOTE 7 – OTHER CURRENT LIABILITIES Other current liabilities consist of the following: March 31, 2017 December 31, 2016 Accrued taxes $ 169,880 $ 182,122 Accrued insurance 108,815 — Allowance for system removal 87,400 116,350 Accrued paid time off 76,432 126,486 Accrued professional services 50,000 25,000 Other accrued liabilities 42,789 35,263 TOTAL OTHER CURRENT LIABILITIES $ 535,316 $ 485,221 |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 8 – INCOME TAXES Deferred income tax assets and liabilities are determined based upon differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. We do not expect to pay any significant federal or state income tax for 2017 as a result of the losses recorded during the three months ended March 31, 2017 and the additional losses expected for the remainder of 2016 and net operating loss carry forwards from prior years. Accounting standards require the consideration of a valuation allowance for deferred tax assets if it is “more likely than not” that some component or all of the benefits of deferred tax assets will not be realized. As of March 31, 2017, we maintained a full valuation allowance for all deferred tax assets. Based on these requirements, no provision or benefit for income taxes has been recorded. There were no recorded unrecognized tax benefits at the end of the reporting period. |
JOINT VENTURE AGREEMENT
JOINT VENTURE AGREEMENT | 3 Months Ended |
Mar. 31, 2017 | |
Equity Method Investments and Joint Ventures [Abstract] | |
JOINT VENTURE AGREEMENT | NOTE 9 – JOINT VENTURE AGREEMENT On November 16, 2009, we entered into a Master Investment Agreement (the “Rockwell Agreement”) with Rockwell Holdings I, LLC, a Wisconsin limited liability (“Rockwell”). Under the terms of the Rockwell Agreement, we used funds from Rockwell to fully implement the CareView System™ in Hillcrest Medical Center in Tulsa, Oklahoma (“Hillcrest”) and Saline Memorial Hospital in Benton, Arkansas (“Saline”) (the “Project Hospital(s)”). CareView-Hillcrest, LLC and CareView-Saline, LLC were created as the operating entities for the Project Hospitals under the Rockwell Agreement (the “Project LLC(s)”). On January 31, 2017, under the terms of the Rockwell, wherein we have the option to purchase Rockwell’s interest in the Project LLCs, we exercised that right by entering into a Settlement and LLC Interest Purchase Agreement with Rockwell (the “Settlement Agreement). Pursuant to the terms of the Settlement Agreement, we paid Rockwell the aggregate amount of $1,213,786 by the issuance of a promissory note to Rockwell for $1,113,786 (the “CareView Note”) and a cash payment of $100,000. Pursuant to the terms of the CareView Note, CareView will make quarterly principal payments of $100,000, with each payment being made on the last day of each calendar quarter beginning with the first payment date of March 31, 2017 (which payment was timely paid) and continuing on the last business day of each subsequent calendar quarter through September 30, 2019. The final payment due on December 31, 2019 shall be a balloon payment of $13,786 representing the remaining principal balance plus all accrued and unpaid interest. As additional consideration to Rockwell for entering into the Rockwell Agreement, we granted Rockwell Warrants to purchase 1,151,206 shares of our Common Stock on the date of the Rockwell Agreement, and, using the Black-Scholes Model, valued the Warrants at $1,124,728 (the “Project Warrant”), which amount was fully amortized at December 31, 2015. Pursuant to the terms of the Settlement Agreement, the expiration date of the Project Warrant was extended from November 16, 2017 to November 16, 2022. All other provisions of the Project Warrant remained unchanged. At the time of the extension, the Project Warrant were revalued resulting in a $11,512 increase in fair value, which has been recorded as non-cash costs included in general and administration expense in the accompanying condensed consolidated financial statements. |
VARIABLE INTEREST ENTITIES
VARIABLE INTEREST ENTITIES | 3 Months Ended |
Mar. 31, 2017 | |
Variable Interest Entities | |
VARIABLE INTEREST ENTITIES | NOTE 10 – VARIABLE INTEREST ENTITIES The Company consolidates VIEs of which it is the primary beneficiary. The liabilities recognized as a result of consolidating these VIEs do not necessarily represent additional claims on our general assets; rather, they represent claims against the specific assets of the consolidated VIEs. Conversely, assets recognized as a result of consolidating these VIEs do not represent additional assets that could be used to satisfy claims against our general assets. The total consolidated VIE assets and liabilities reflected on our condensed consolidated balance sheets at March 31, 2017 and December 31, 2016 are as follows: March 31, December 31, Assets Cash $ — $ 1,270 Receivables — 2,579 Total current assets — 3,849 Property, net — 22,555 Total assets $ — $ 26,404 Liabilities Accounts payable $ — $ 141,782 Accrued interest — 439,173 Other current liabilities — 439,173 Notes payable — 328,978 Mandatorily redeemable interest — 8,747 Total liabilities $ — $ 1,357,853 The financial performance of the consolidated VIEs reflected on our condensed consolidated statements of operations for the three months ended March 31, 2017 and 2016 is as follows: March 31, 2017 2016 Revenue $ — $ 7,097 Network operations expense — 4,164 General and administrative expense — 813 Depreciation — 12,133 Total operating costs — 17,110 Operating loss — (10,013 ) Other expense — (22,207 ) Loss before taxes — (32,220 ) Provision for taxes — — Net loss — (32,220 ) Net loss attributable to noncontrolling interest — (16,110 ) Net loss attributable to CareView Communications, Inc. $ — $ (16,110 ) |
AGREEMENT WITH HEALTHCOR
AGREEMENT WITH HEALTHCOR | 3 Months Ended |
Mar. 31, 2017 | |
Agreement With Healthcor | |
AGREEMENT WITH HEALTHCOR | NOTE 11 – AGREEMENT WITH HEALTHCOR On April 21, 2011, we entered into a Note and Warrant Purchase Agreement (as subsequently amended) (the “HealthCor Purchase Agreement”) with HealthCor. Pursuant to the terms HealthCor Purchase Agreement, we sold Senior Secured Convertible Notes to HealthCor in the principal amount of $9,316,000 and $10,684,000, respectively (collectively the “2011 HealthCor Notes”). The 2011 HealthCor Notes have a maturity date of April 20, 2021. We also issued Warrants to HealthCor for the purchase of an aggregate of up to 5,488,456 and 6,294,403 shares, respectively, of our Common Stock at an exercise price of $1.40 per share (collectively the “2011 HealthCor Warrants”). So long as no event of default has occurred, the outstanding principal balances of the 2011 HealthCor Notes accrue interest from April 21, 2011 through April 20, 2016 (the “First Five Year Note Period”) at the rate of 12.5% per annum, compounding quarterly and shall be added to the outstanding principal balances of the 2011 HealthCor Notes on the last day of each calendar quarter. Interest accruing from April 21, 2016 through April 20, 2021 (the “Second Five Year Note Period”) at a rate of 10% per annum, compounding quarterly, may be paid quarterly in arrears in cash or, at our option, such interest may be added to the outstanding principal balances of the 2011 HealthCor Notes on the last day of each calendar quarter. For the period from April 21, 2016 through March 31, 2017 interest has been added to the outstanding principal balance. From the date any event of default occurs, the interest rate, then applicable, shall be increased by five percent (5%) per annum. HealthCor has the right, upon an event of default, to declare due and payable any unpaid principal amount of the 2011 HealthCor Notes then outstanding, plus previously accrued but unpaid interest and charges, together with the interest then scheduled to accrue (calculated at the default rate described in the immediately preceding sentence) through the end of the First Five Year Note Period or the Second Five Year Note Period, as applicable. At any time after April 21, 2011, HealthCor is entitled to convert any portion of the outstanding and unpaid accrued interest on and principal balances of the 2011 HealthCor Notes into fully paid and non-assessable shares of our Common Stock at a conversion rate of $1.25 per share, subject to adjustment in accordance with anti-dilution provisions set forth in the 2011 HealthCor Notes. As of March 31, 2017, the underlying shares of our Common Stock related to the 2011 HealthCor Notes totaled approximately 33,000,000. On January 31, 2012, we entered into the Second Amendment to the HealthCor Purchase Agreement with HealthCor (the “Second Amendment”) amending the HealthCor Purchase Agreement, and sold Senior Secured Convertible Notes to HealthCor in the principal amounts of $2,329,000 and $2,671,000, respectively (collectively the “2012 HealthCor Notes”). As provided by the Second Amendment, the 2012 HealthCor Notes are in substantially the same form as the 2011 HealthCor Notes, with changes to the “Issuance Date,” “Maturity Date,” “First Five Year Note Period” and other terms to take into account the timing of the issuance of the 2012 HealthCor Notes. The 2012 HealthCor Notes have a maturity date of January 30, 2022. In addition, the provisions regarding interest payments, interest acceleration, optional conversion, negative covenants, and events of default, preemptive rights and registration rights are the same as those of the 2011 HealthCor Notes. At any time after January 30, 2012, HealthCor is entitled to convert any portion of the outstanding and unpaid accrued interest on and principal balances of the 2012 HealthCor Notes into fully paid and non-assessable shares of our Common Stock at a conversion rate of $1.25 per share, subject to adjustment in accordance with anti-dilution provisions set forth in the 2012 HealthCor Notes. As of March 31, 2017, the underlying shares of our Common Stock related to the 2012 HealthCor Notes totaled approximately 8,000,000. On August 20, 2013, we entered into a Third Amendment to the HealthCor Purchase Agreement with HealthCor (the “Third Amendment”) to redefine our minimum cash balance requirements. Previously we were required to maintain a minimum cash balance of $5,000,000 and should we drop below that balance, it triggered a default. The Third Amendment allowed for a reduced minimum cash period, as defined in the HealthCor Purchase Agreement, which allowed us to drop below $5,000,000, but not below $4,000,000. All other terms and conditions of the HealthCor Purchase Agreement, including all amendments thereto, remain the same. Upon entering the reduced minimum cash period (which occurred on October 7, 2013), we had 120 days to return our minimum cash balance to the original $5,000,000. On January 16, 2014, we increased our cash balance to in excess of the original $5,000,000 minimum allowable balance. On January 16, 2014, we entered into a Fourth Amendment to the HealthCor Purchase Agreement with HealthCor (the “Fourth Amendment”) and sold Senior Secured Convertible Notes to HealthCor in the principal amounts of $2,329,000 and $2,671,000 (collectively the ‘‘2014 HealthCor Notes’’). As provided by the Fourth Amendment, the 2014 HealthCor Notes are in substantially the same form as the 2011 HealthCor Notes, with changes to the “Issuance Date,” “Maturity Date,” “First Five Year Note Period” and other terms to take into account the timing of the issuance of the 2014 HealthCor Notes. The 2014 HealthCor Notes have a maturity date of January 15, 2024. In addition, the provisions regarding interest payments, interest acceleration, optional conversion, negative covenants, and events of default, preemptive rights and registration rights are the same as those of the 2011 HealthCor Notes. At any time after January 16, 2014, HealthCor is entitled to convert any portion of the outstanding and unpaid accrued interest on and principal balances of the 2014 HealthCor Notes into fully paid and non-assessable shares of our Common Stock at a conversion rate of $0.40 per share, subject to adjustment in accordance with anti-dilution provisions set forth in the 2014 HealthCor Notes. Additionally we issued Warrants to HealthCor for the purchase of an aggregate of up to 4,000,000 shares of our Common Stock at an exercise price of $0.40 per share (collectively the “2014 HealthCor Warrants”). As of March 31, 2017, the underlying shares of our Common Stock related to the 2014 HealthCor Notes totaled approximately 19,000,000. On December 4, 2014, we entered into a Fifth Amendment to the HealthCor Purchase Agreement (the “Fifth Amendment”) with HealthCor and certain additional investors (such additional investors, the “New Investors” and, collectively with HealthCor Partners Fund, LP, the “Investors”) and agreed to sell and issue (i) additional notes in the initial aggregate principal amount of $6,000,000,with a conversion price per share of $0.52 (subject to adjustment as described therein) (the “Fifth Amendment Notes”) and (ii) additional Warrants for an aggregate of up to 3,692,308 shares of our Common Stock at an exercise price per share of $0.52 (subject to adjustment as described therein) (the “Fifth Amendment Warrants”). As provided by the Fifth Amendment, the Fifth Amendment Notes are in substantially the same form as the 2011 HealthCor Notes, with changes to the “Issuance Date,” “Maturity Date,” “First Five Year Note Period” and other terms to take into account the timing of the issuance of the Fifth Amendment Notes. The Fifth Amendment Notes have a maturity date of February 16, 2025. In addition, the provisions regarding interest payments, interest acceleration, optional conversion, negative covenants, and events of default, preemptive rights and registration rights are the same as those of the 2011 HealthCor Notes. The New Investors are composed of all but one of our current directors and one of our officers. On February 17, 2015, the Company and the Investors closed on the transactions contemplated by the Fifth Amendment. In connection with this closing, the Company and the Investors entered into an Amended and Restated Pledge and Security Agreement (the “Amended Security Agreement”), amending and restating that certain Pledge and Security Agreement dated as of April 20, 2011, and an Amended and Restated Intellectual Property Security Agreement (the “Amended IP Security Agreement”), amending and restating that certain Intellectual Property Security Agreement dated as of April 20, 2011. As of March 31, 2017, the underlying shares of our Common Stock related to the Fifth Amendment Notes totaled approximately 2,000,000 to HealthCor and 12,000,000 to the New Investors. On March 31, 2015, we entered into the Sixth Amendment to the HealthCor Purchase Agreement (the “Sixth Amendment”) pursuant to which, among other things, (i) the requirement to maintain a minimum cash balance of $5,000,000 was reduced to a minimum cash balance of $2,000,000 and (ii) the amendment provision was revised to permit the HealthCor Purchase Agreement to be amended by the Company and the holders of the majority of the Common Stock underlying the outstanding notes and warrants to purchase shares of our Common Stock sold pursuant to the HealthCor Purchase Agreement. On March 31, 2015, we also issued a warrant to HealthCor to purchase up to an aggregate of 1,000,000 shares of our Common Stock in consideration for certain prior waivers of the minimum cash balance requirement in the HealthCor Purchase Agreement (the “Sixth Amendment Warrant”). The Sixth Amendment Warrant has an exercise price per share of $0.53 (subject to adjustment as described therein) and an expiration date of March 31, 2025. On June 26, 2015, we (i) entered into a Seventh Amendment to the HealthCor Purchase Agreement (the “Seventh Amendment”) pursuant to which the HealthCor Purchase Agreement was amended to permit the Company to enter into and perform its obligations under the Credit Agreement entered into with PDL BioPharma, Inc., as administrative agent and lender (the “Lender”) (the “PDL Credit Agreement”); (ii) executed an Amendment to the Registration Rights Agreement between the Company and HealthCor dated April 21, 2011 (the “RR Agreement”) pursuant to which the RR Agreement was amended to make its priority of registration consistent with the Registration Rights Agreement executed by the Company and Lender (as detailed in NOTE 12 NOTE 12 Accounting Treatment When issuing debt or equity securities convertible into common stock at a discount to the fair value of the common stock at the date the debt or equity financing is committed, a company is required to record a beneficial conversion feature (“BCF”) charge. We had three separate issuances of equity securities convertible into common stock that qualify under this accounting treatment, (i) the 2011 HealthCor Notes, (ii) the 2012 HealthCor Notes and (iii) the 2014 HealthCor Notes. Because the conversion option and the 2011 HealthCor Warrants on the 2011 HealthCor Notes were originally classified as a liability when issued due to the down round provision and the removal of the provision requiring liability treatment, and subsequently reclassified to equity on December 31, 2011 when the 2011 HealthCor Notes were amended, only the accrued interest capitalized as payment in kind (‘‘PIK’’) since reclassification qualifies under this accounting treatment. The face amount of the 2012 and 2014 HealthCor Notes and all accrued PIK interest also qualify for this accounting treatment. During the three months ended March 31, 2017 and 2016, we recorded a BCF of $63,585 and $516,844, respectively. The BCF was recorded as a charge to debt discount and a credit to additional paid in capital, with the debt discount, using the effective interest method, amortized to interest expense over the term of the notes. As Warrants were issued with the Fifth Amendment Notes, the proceeds were allocated to the instruments based on relative fair value as the Warrants did not contain any features requiring liability treatment and therefore were classified as equity. The Warrants issued with the Sixth Amendment also did not contain features requiring liability accounting and were recorded at fair value on the date of issuance with the offsetting credit recorded in equity. The value allocated to the Fifth Amendment Warrants was $1,093,105, which was recorded as debt discount with the credit to additional paid in capital. We recorded an aggregate of $739,017 and $592,688 in interest expense for the three months ended March 31, 2017 and 2016, respectively, related to these transactions. The carrying value of the debt with HealthCor and the New Investors at March 31, 2017 approximates fair value as the interest rates used are those currently available to us and would be considered level 3 inputs under the fair value hierarchy. The value allocated to the Sixth Amendment Warrant was $378,000, which was recorded as deferred debt costs with the credit to additional paid in capital. We recorded an aggregate of $14,450 in financing costs for both the three months ended March 31, 2017 and 2016 related to this transaction. |
AGREEMENT WITH PDL BIOPHARMA, I
AGREEMENT WITH PDL BIOPHARMA, INC. | 3 Months Ended |
Mar. 31, 2017 | |
Agreement With Pdl Biopharma Inc. | |
AGREEMENT WITH PDL BIOPHARMA | NOTE 12 – AGREEMENT WITH PDL BIOPHARMA, INC. On June 26, 2015, we entered into a Credit Agreement with PDL BioPharma, Inc., as administrative agent and lender (“PDL” or the “Lender”) (the “PDL Credit Agreement”). Under the PDL Credit Agreement the Lender made available to us up to $40 million in two tranches of $20 million each. Certain covenants of the PDL Credit Agreement include (a) in the event that a milestone relating to the placement of 9,000 billable units occurs on or before October 31, 2015, the Lender will fund us $20 million (the “Tranche One Loan”) and (b) in the event that additional milestones relating to (i) the placement of 27,750 billable units and (ii) the Company recording earnings before interest, tax, depreciation, and amortization (EBITDA) of not less than $7,000,000 on an annualized basis for the three calendar month period prior to the funding (on or before June 30, 2017), the Lender will fund us an additional $20 million (the “Tranche Two Loan” and, together with the Tranche One Loan, the “Loans”). Outstanding borrowings under the Tranche One Loan bear interest at the rate of 13.5% per annum, payable quarterly in arrears. Outstanding borrowings under the Tranche Two Loan bear interest at the rate of 13.0% per annum, payable quarterly in arrears. From the date any event of default occurs, the interest rate shall be increased by five percent (5%) per annum. The PDL Credit Agreement includes a minimum cash balance requirement of $3,250,000 and should we drop below $3,250,000, it will trigger a default. The $3,250,000 has been recorded as restricted cash on the condensed consolidated balance sheets at March 31, 2017 and December 31, 2016. On October 7, 2015, the Company entered into a First Amendment (the “First Amendment”) to the PDL Credit Agreement. The First Amendment modified the conditions precedent to the funding of each tranche, such that, among other things, we no longer need to attain a specified milestone relating to the placement of our products in order for the Lender to fund us the Tranche One Loan. Contemporaneously with the execution of the First Amendment we borrowed the Tranche One Loan and issued to the Lender a term note in the principal amount of $20 million (the “Tranche One Term Note”), payable in accordance with the terms of the Credit Agreement, as amended. The First Amendment also included a revision to the Tranche Two Milestone, which changed from a minimum of 27,750 billable units (defined as one unit for each room control platform and two units for each nurse station monitor) to 31,500 Bed Equivalent Units (defined as a billable unit plus 14 units for each head-end server operating as the communication center and fractional units for mobile assets as applicable). Once funded, the PDL Credit Agreement requires interest only payments for the first eight interest payment dates and principal plus interest payments will commence on the ninth interest payment date. We may elect to pay a portion of the interest due in the form of additional loans (interest paid in kind) during the first eight interest payment dates. The first principal payment on the Tranche One Term Note is due on January 8, 2018 in the amount of $1,666,667, with similar amounts due quarterly thereafter with the final payment due on October 8, 2020. Each tranche will mature on the fifth anniversary of the date borrowed. We may elect to prepay the Loans at any time without any premium or penalty, subject to certain conditions. The obligations under the PDL Credit Agreement are secured by a pledge of substantially all of the assets of the Company and certain of its domestic subsidiaries. We executed a Subordination and Intercreditor Agreement (the “Subordination and Intercreditor Agreement”), with the Lender, HealthCor and the New Investors (as defined in NOTE 11 The PDL Credit Agreement contains customary affirmative covenants for transactions of this type and other affirmative covenants agreed to by the Company and the Lender, including, among others, the provision of annual and quarterly reports, maintenance of property, insurance, compliance with laws and contractual obligations and payment of taxes. The PDL Credit Agreement contains customary negative covenants for transactions of this type and other negative covenants agreed to by the Company and the Lender, including, among others, restrictions on the incurrence of indebtedness, the granting of liens, making restricted payments and investments, entering into affiliate transactions and transferring assets. The PDL Credit Agreement also provides for a number of customary events of default, including payment, bankruptcy, covenant, representation and warranty and judgment defaults. We were not in default of any conditions under the PDL Credit Agreement as of March 31, 2017. Contemporaneously with the execution of the PDL Credit Agreement, we issued to the Lender a warrant to purchase 4,444,445 shares of our Common Stock at an exercise price of $0.45 per share, subject to adjustment as described therein (the “PDL Warrant”). The PDL Warrant expires on June 26, 2025. Pursuant to the terms of the First Amendment we amended and restated the PDL Warrant, reducing the exercise price per share from $0.45 to $0.40 (the “Amended Warrant”). All other provisions of the Amended Warrant remained unchanged. In addition, contemporaneously with the execution of the PDL Credit Agreement the Company and the Lender executed (i) a Registration Rights Agreement pursuant to which the Company agreed to provide the Lender with certain registration rights with respect to the shares of Common Stock issuable upon exercise of the PDL Warrant (the “PDL RRA”), (ii) a Guarantee and Collateral Agreement (the “Guarantee and Collateral Agreement”) pursuant to which certain of our subsidiaries guaranteed the performance of our obligations under the PDL Credit Agreement and granted the Lender a security interest in such subsidiaries’ tangible and intangible assets securing our performance of the same, and (iii) a Patent Security Agreement and a Trademark Security Agreement pursuant to which we granted the Lender a security interest in a certain subsidiary’s tangible and intangible assets securing the performance of our obligations under the PDL Credit Agreement. Accounting Treatment In connection with the Credit Agreement, we issued the PDL Warrant to the Lender. The fair value of the PDL Warrant at issuance was $1,257,778, which has been recorded as deferred issuance costs in the accompanying condensed consolidated financial statements. The deferred debt issuance costs associated with the PDL Credit Agreement are recorded as assets in accordance with the accounting standards as the PDL Credit Agreement is considered to be a credit facility and the warrants were payment for the facility and not the drawdowns. These costs are amortized to interest expense using the straight line method over the term of the Credit Agreement. Upon amendment of the PDL Warrant, we evaluated whether there was an increase in fair value which would require recognition of additional costs. No such increase in fair value was noted and no adjustment to the PDL Warrant valuation was necessary. For both the three months ended March 31, 2017 and 2016, $44,922 was amortized to interest expense. The PDL Warrant has not been exercised. We also incurred certain financing costs totaling $805,917 in the accompanying condensed consolidated financial statements. These costs have been recorded as deferred financing costs and are being amortized to interest expense over the term of the Credit Agreement. For both the three months ended March 31, 2017 and 2016, $27,849, respectively, was amortized to interest expense. |
BASIS OF PRESENTATION AND REC18
BASIS OF PRESENTATION AND RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS (Policies) | 3 Months Ended |
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Interim Financial Statements | Interim Financial Statements The accompanying unaudited interim condensed consolidated financial statements of CareView Communications, Inc. (“CareView”, the “Company”, “we”, “us” or “our”) have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, such financial statements include all adjustments (consisting solely of normal recurring adjustments) necessary for the fair statement of the financial information included herein in accordance with GAAP and the rules and regulations of the Securities and Exchange Commission (the “SEC”). The balance sheet at December 31, 2016 has been derived from the audited consolidated financial statements at that date but does not include all of the information and footnotes required by GAAP for complete financial statements. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the period. Actual results could differ from those estimates. Results of operations for interim periods are not necessarily indicative of results for the full year. The accompanying condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2016 as filed with the SEC on March 31, 2017. |
Earnings Per Share | Earnings Per Share We calculate earnings per share (“EPS”) in accordance with GAAP, which requires the computation and disclosure of two EPS amounts, basic and diluted. Basic EPS is computed based on the weighted average number of shares of common stock outstanding during the period. Diluted EPS is computed based on the weighted average number of common shares outstanding plus all potentially dilutive common shares outstanding during the period under the treasury stock method. Such potential dilutive common shares consist of stock options, warrants and convertible debt. Potential common shares totaling approximately 124,000,000 and 110,000,000 at March 31, 2017 and 2016, respectively, have been excluded from the diluted earnings per share calculation as they are anti-dilutive due to our reported net loss. |
Recently Issued and Newly Adopted Accounting Pronouncements | Recently Issued and Newly Adopted Accounting Pronouncements There have been no material changes to our significant accounting policies as summarized in NOTE 2 of our Annual Report on Form 10-K for the year ended December 31, 2016 not expect that the adoption of any recent accounting pronouncements will have a material impact on our accompanying condensed consolidated financial statements. |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Stockholders' Equity Note [Abstract] | |
Schedule of stock option activity | A summary of our stock option activity and related information follows: Number of Weighted Weighted Aggregate Balance at December 31, 2016 15,910,975 $ 0.37 8.0 $ — Granted 20,000 $ 0.09 $ — Canceled (74,165 ) Balance at March 31, 2017 15,856,810 $ 0.37 7.8 $ 13,315 Vested and Exercisable at March 31, 2017 7,818,514 $ 0.59 $ — |
Schedule of assumptions used in the Black-Scholes Model - stock options | The assumptions used in the Black-Scholes Model are set forth in the table below. Three Months Ended March 31, 2017 Year Ended December 31, 2016 Risk-free interest rate 1.99 % 1.13-1.84 % Volatility 78.40 % 63.49-73.73 % Expected life in years 6 6 Dividend yield 0.00 % 0.00 % |
OTHER CURRENT ASSETS (Tables)
OTHER CURRENT ASSETS (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Other Current Assets | |
Schedule of other current assets | Other current assets consist of the following: March 31, 2017 December 31, Prepaid equipment $ 167,597 $ 40,269 Prepaid insurance 150,444 39,343 Other prepaid expense 30,201 20,489 Other current assets 7,260 14,616 TOTAL OTHER CURRENT ASSETS $ 355,502 $ 114,717 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment | Property and equipment consist of the following: March 31, 2017 December 31, Network equipment $ 12,856,069 $ 12,632,559 Office equipment 250,080 243,267 Vehicles 161,584 161,584 Test equipment 172,985 166,484 Furniture 90,244 87,646 Warehouse equipment 9,524 9,524 Leasehold improvements 5,121 5,121 13,545,607 13,306,185 Less: accumulated depreciation (9,720,247 ) (9,153,771 ) TOTAL PROPERTY AND EQUIPMENT $ 3,825,360 $ 4,152,414 |
OTHER ASSETS (Tables)
OTHER ASSETS (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of intangible assets | Intangible assets consist of the following: March 31, 2017 Cost Accumulated Amortization Net Patents and trademarks $ 725,850 $ 113,480 $ 612,370 Other intangible assets 53,087 49,668 3,419 TOTAL INTANGIBLE ASSETS $ 778,937 $ 163,148 $ 615,789 December 31, 2016 Cost Accumulated Amortization Net Patents and trademarks $ 711,961 $ 104,574 $ 607,387 Other intangible assets 53,088 48,138 4,950 TOTAL INTANGIBLE ASSETS $ 765,049 $ 152,712 $ 612,337 |
Schedule of other assets | Other assets consist of the following: March 31, 2017 Cost Accumulated Amortization Net Deferred debt issuance costs $ 1,257,778 $ 316,450 $ 941,328 Prepaid financing costs 805,917 213,315 592,602 Deferred installation costs 1,618,482 1,305,192 313,290 Prepaid license fee 249,999 91,529 158,470 Security deposit 46,124 — 46,124 TOTAL OTHER ASSETS $ 3,978,300 $ 1,926,486 $ 2,051,814 Other assets consist of the following: December 31, 2016 Cost Accumulated Amortization Net Deferred debt issuance costs $ 1,257,778 $ 271,528 $ 986,250 Deferred financing costs 805,917 185,466 620,451 Deferred installation costs 1,582,059 1,228,558 353,501 Prepaid license fee 249,999 87,431 162,568 Security deposit 46,124 — 46,124 TOTAL OTHER ASSETS $ 3,941,877 $ 1,772,983 $ 2,168,894 |
OTHER CURRENT LIABILITIES (Tabl
OTHER CURRENT LIABILITIES (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Payables and Accruals [Abstract] | |
Schedule of other current liabilities | Other current liabilities consist of the following: March 31, 2017 December 31, 2016 Accrued taxes $ 169,880 $ 182,122 Accrued insurance 108,815 — Allowance for system removal 87,400 116,350 Accrued paid time off 76,432 126,486 Accrued professional services 50,000 25,000 Other accrued liabilities 42,789 35,263 TOTAL OTHER CURRENT LIABILITIES $ 535,316 $ 485,221 |
VARIABLE INTEREST ENTITIES (Tab
VARIABLE INTEREST ENTITIES (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Variable Interest Entities | |
Schedule of VIE assets and liabilities and results of operations | The total consolidated VIE assets and liabilities reflected on our condensed consolidated balance sheets at March 31, 2017 and December 31, 2016 are as follows: March 31, December 31, Assets Cash $ — $ 1,270 Receivables — 2,579 Total current assets — 3,849 Property, net — 22,555 Total assets $ — $ 26,404 Liabilities Accounts payable $ — $ 141,782 Accrued interest — 439,173 Other current liabilities — 439,173 Notes payable — 328,978 Mandatorily redeemable interest — 8,747 Total liabilities $ — $ 1,357,853 The financial performance of the consolidated VIEs reflected on our condensed consolidated statements of operations for the three months ended March 31, 2017 and 2016 is as follows: March 31, 2017 2016 Revenue $ — $ 7,097 Network operations expense — 4,164 General and administrative expense — 813 Depreciation — 12,133 Total operating costs — 17,110 Operating loss — (10,013 ) Other expense — (22,207 ) Loss before taxes — (32,220 ) Provision for taxes — — Net loss — (32,220 ) Net loss attributable to noncontrolling interest — (16,110 ) Net loss attributable to CareView Communications, Inc. $ — $ (16,110 ) |
BASIS OF PRESENTATION AND REC25
BASIS OF PRESENTATION AND RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS (Details Narrative) - shares | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Anti-dilutive common share equivalents excluded from EPS calculation | 124,000,000 | 110,000,000 |
LIQUIDITY AND MANAGEMENT'S PL26
LIQUIDITY AND MANAGEMENT'S PLAN (Details Narrative) - USD ($) | Oct. 07, 2015 | Mar. 31, 2017 | Dec. 31, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Jun. 26, 2015 | Apr. 21, 2011 |
Cash and cash equivalents | $ 7,827,332 | $ 10,088,258 | $ 15,568,573 | $ 17,678,969 | |||
Restricted cash | 3,250,000 | 3,250,000 | |||||
Loan payable | 20,000,000 | $ 20,000,000 | |||||
HealthCor Purchase Agreement [Member] | |||||||
Minimum cash balance required under existing loan documents | $ 2,000,000 | ||||||
PDL BioPharma, Inc (Administrative Agent and Lender) [Member] | |||||||
Restricted cash | $ 3,250,000 | ||||||
Minimum cash balance required under existing loan documents | $ 3,250,000 | ||||||
Debt face amount | 40,000,000 | ||||||
Proceeds from issuance of debt, net | $ 19,533,992 | ||||||
PDL BioPharma, Inc (Administrative Agent and Lender) [Member] | Tranche One Debt [Member] | |||||||
Debt face amount | 20,000,000 | ||||||
PDL BioPharma, Inc (Administrative Agent and Lender) [Member] | Tranche Two Debt [Member] | |||||||
Debt face amount | $ 20,000,000 |
STOCKHOLDERS' EQUITY (Details)
STOCKHOLDERS' EQUITY (Details) | 3 Months Ended |
Mar. 31, 2017USD ($)$ / sharesshares | |
Number Options | |
Stock Options Outstanding, Beginning | 15,910,975 |
Granted | 20,000 |
Canceled | (74,165) |
Stock Options Outstanding, Ending | 15,856,810 |
Stock Options, vested and exercisable | 7,818,514 |
Weighted Average Exercise Price | |
Stock Options Outstanding, Beginning | $ / shares | $ 0.37 |
Granted | $ / shares | 0.09 |
Stock Options Outstanding, Ending | $ / shares | 0.37 |
Stock Options, vested and exercisable | $ / shares | $ 0.59 |
Weighted Average Remaining Contractual Life | |
Stock Options Outstanding, Beginning | 8 years |
Stock Options Outstanding, Ending | 7 years 9 months 18 days |
Aggregate Intrinsic Value | |
Stock Options Outstanding, Ending | $ | $ 13,315 |
STOCKHOLDERS' EQUITY (Details 1
STOCKHOLDERS' EQUITY (Details 1) - Stock Options [Member] | 3 Months Ended | 12 Months Ended |
Mar. 31, 2017 | Dec. 31, 2016 | |
Black-Scholes Model: | ||
Risk-free interest rate | 1.99% | |
Volatility | 78.40% | |
Expected life | 6 years | 6 years |
Dividend yield | 0.00% | 0.00% |
Lower Range [Member] | ||
Black-Scholes Model: | ||
Risk-free interest rate | 1.84% | |
Volatility | 73.73% | |
Upper Range [Member] | ||
Black-Scholes Model: | ||
Risk-free interest rate | 1.13% | |
Volatility | 63.49% |
STOCKHOLDERS' EQUITY (Details N
STOCKHOLDERS' EQUITY (Details Narrative) - USD ($) | 3 Months Ended | |||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | |
Warrant activity | ||||
Fair value of warrant liability | $ 629 | $ 629 | $ 168,805 | |
Fair value adjustment of warrants | $ (84,497) | |||
Option activity | ||||
Options granted | 20,000 | |||
Options canceled | (74,165) | |||
Share-based compensation expense | $ 120,376 | 190,843 | ||
Unrecognized estimated compensation expense | $ 842,000 | |||
Period for recognization of unrecognized compensation expense | 1 year 6 months | |||
Warrants Revalued [Member] | ||||
Warrant activity | ||||
Fair value of warrants at re-value | 168,805 | |||
Fair value adjustment of warrants | $ (84,497) |
OTHER CURRENT ASSETS (Details)
OTHER CURRENT ASSETS (Details) - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Other Current Assets | ||
Prepaid equipment | $ 167,597 | $ 40,269 |
Prepaid insurance | 150,444 | 39,343 |
Other prepaid expenses | 30,201 | 20,489 |
Other current assets | 7,260 | 14,616 |
TOTAL OTHER CURRENT ASSETS | $ 355,502 | $ 114,717 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 13,545,607 | $ 13,306,185 |
Less: accumulated depreciation | (9,720,247) | (9,153,771) |
Property and equipment, net | 3,825,360 | 4,152,414 |
Network Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 12,856,069 | 12,632,559 |
Office Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 250,080 | 243,267 |
Vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 161,584 | 161,584 |
Test Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 172,985 | 166,484 |
Furniture [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 90,244 | 87,646 |
Warehouse Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 9,524 | 9,524 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 5,121 | $ 5,121 |
PROPERTY AND EQUIPMENT (Detai32
PROPERTY AND EQUIPMENT (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expense | $ 443,246 | $ 423,560 |
OTHER ASSETS (Details)
OTHER ASSETS (Details) - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Finite-Lived Intangible Assets [Line Items] | ||
Cost | $ 778,937 | $ 765,049 |
Accumulated Amortization | 163,148 | 152,712 |
Intangible assets, Net | 615,789 | 612,337 |
Patents and Trademarks [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 725,850 | 711,961 |
Accumulated Amortization | 113,480 | 104,574 |
Intangible assets, Net | 612,370 | 607,387 |
Other Intangible Assets [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 53,087 | 53,088 |
Accumulated Amortization | 49,668 | 48,138 |
Intangible assets, Net | $ 3,419 | $ 4,950 |
OTHER ASSETS (Details 1)
OTHER ASSETS (Details 1) - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Cost | $ 3,978,300 | $ 3,941,877 |
Accumulated Amortization | 1,926,486 | 1,772,983 |
Other assets | 2,051,814 | 2,168,894 |
Deferred Debt Issuance Costs [Member] | ||
Cost | 1,257,778 | 1,257,778 |
Accumulated Amortization | 316,450 | 271,528 |
Other assets | 941,328 | 986,250 |
Deferred Financing Costs [Member] | ||
Cost | 805,917 | 805,917 |
Accumulated Amortization | 213,315 | 185,466 |
Other assets | 592,602 | 620,451 |
Deferred Installation Costs [Member] | ||
Cost | 1,618,482 | 1,582,059 |
Accumulated Amortization | 1,305,192 | 1,228,558 |
Other assets | 313,290 | 353,501 |
Prepaid License Fee [Member] | ||
Cost | 249,999 | 249,999 |
Accumulated Amortization | 91,529 | 87,431 |
Other assets | 158,470 | 162,568 |
Security Deposit [Member] | ||
Cost | 46,124 | 46,124 |
Other assets | $ 46,124 | $ 46,124 |
OTHER CURRENT LIABILITIES (Deta
OTHER CURRENT LIABILITIES (Details) - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
OTHER CURRENT LIABILITIES: | ||
Accrued taxes | $ 169,880 | $ 182,122 |
Accrued Insurance | 108,815 | |
Allowance for system removal | 87,400 | 116,350 |
Accrued paid time off | 76,432 | 126,486 |
Accrued professional services | 50,000 | 25,000 |
Other accrued liabilities | 42,789 | 35,263 |
TOTAL OTHER CURRENT LIABILITIES | $ 535,316 | $ 485,221 |
JOINT VENTURE AGREEMENT (Detail
JOINT VENTURE AGREEMENT (Details Narrative) - USD ($) | Jan. 31, 2017 | Nov. 16, 2009 | Mar. 31, 2016 | Mar. 31, 2017 | Dec. 31, 2016 |
Other current liabilities | $ 535,316 | $ 485,221 | |||
Fair value adjustment of warrants | $ (84,497) | ||||
Joint Venture - Rockwell [Member] | |||||
Total cost to acquire remaining interest in joint venture | $ 1,213,786 | ||||
Promissory note issued to acquire interest in joint venture | 1,113,786 | ||||
Cash payment to acquire remaining interest in joint venture | 100,000 | ||||
Joint Venture - Rockwell [Member] | Warrants [Member] | |||||
Warrants issued for financing costs, warrants | 1,151,206 | ||||
Fair value of warrants issued to Rockwell for providing funding | $ 1,124,728 | ||||
Fair value adjustment of warrants | $ 11,512 |
VARIABLE INTEREST ENTITIES (Det
VARIABLE INTEREST ENTITIES (Details) - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Assets | ||
Receivables | $ 1,133,598 | $ 1,069,304 |
Total current assets | 9,316,432 | 11,272,279 |
Property, net | 3,825,360 | 4,152,414 |
Liabilities | ||
Accounts payable | 336,899 | 195,472 |
Accrued interest | 328,979 | |
Other current liabilities | $ 535,316 | 485,221 |
Variable Interest Entity [Member] | ||
Assets | ||
Cash | 1,270 | |
Receivables | 2,579 | |
Total current assets | 3,849 | |
Property, net | 22,555 | |
Total assets | 26,404 | |
Liabilities | ||
Accounts payable | 141,782 | |
Accrued interest | 439,173 | |
Other current liabilities | 439,173 | |
Notes payable | 328,978 | |
Mandatorily redeemable interest | 8,747 | |
Total liabilities | $ 1,357,853 |
VARIABLE INTEREST ENTITIES (D38
VARIABLE INTEREST ENTITIES (Details 1) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Revenue | $ 1,497,693 | $ 1,495,793 |
Network operations expense | 1,153,448 | 1,152,107 |
General and administrative expense (recovery) | 1,083,022 | 1,054,858 |
Depreciation | 453,682 | 445,416 |
Total operating costs | 3,294,103 | 3,123,167 |
Operating loss | (1,796,410) | (1,627,374) |
Loss before taxes | (5,008,046) | (4,684,344) |
Net loss attributable to noncontrolling interest | (16,110) | |
Net loss attributable to CareView Communications, Inc. | $ (5,008,046) | (4,668,234) |
Variable Interest Entity [Member] | ||
Revenue | 7,097 | |
Network operations expense | 4,164 | |
General and administrative expense (recovery) | 813 | |
Depreciation | 12,133 | |
Total operating costs | 17,110 | |
Operating loss | (10,013) | |
Other expense | (22,207) | |
Loss before taxes | (32,220) | |
Net loss | (32,220) | |
Net loss attributable to noncontrolling interest | (16,110) | |
Net loss attributable to CareView Communications, Inc. | $ (16,110) |
AGREEMENT WITH HEALTHCOR (Detai
AGREEMENT WITH HEALTHCOR (Details Narrative) | Jan. 31, 2012USD ($)$ / shares | Apr. 21, 2011USD ($)$ / sharesshares | Mar. 31, 2017Number |
HealthCor Purchase Agreement [Member] | 2011 Senior Secured Convertible Note#1 [Member] | |||
Note amount | $ | $ 9,316,000 | ||
Debt Maturity Date | Apr. 20, 2021 | ||
Issuance of warrants | shares | 5,488,456 | ||
Exercise price of warrants | $ / shares | $ 1.40 | ||
HealthCor Purchase Agreement [Member] | 2011 Senior Secured Convertible Note#2 [Member] | |||
Note amount | $ | $ 10,684,000 | ||
Debt Maturity Date | Apr. 20, 2021 | ||
Issuance of warrants | shares | 6,294,403 | ||
Exercise price of warrants | $ / shares | $ 1.40 | ||
HealthCor Purchase Agreement [Member] | 2011 Senior Secured Convertible Notes [Member] | |||
Increase in interest rate (per annum) should default occur | 5.00% | ||
Debt conversion price | $ / shares | $ 1.25 | ||
Number of shares the note may be converted into | Number | 33,000,000 | ||
HealthCor Purchase Agreement [Member] | 2011 Senior Secured Convertible Notes [Member] | First Five Year Note Period [Member] | |||
Interest rate, provided no default | 12.50% | ||
HealthCor Purchase Agreement [Member] | 2011 Senior Secured Convertible Notes [Member] | Second Five Year Note Period [Member] | |||
Interest rate, provided no default | 10.00% | ||
HealthCor Second Amendment Purchase Agreement [Member] | 2012 Senior Secured Convertible Note#1 [Member] | |||
Note amount | $ | $ 2,329,000 | ||
Debt Maturity Date | Jan. 30, 2022 | ||
HealthCor Second Amendment Purchase Agreement [Member] | 2012 Senior Secured Convertible Note#2 [Member] | |||
Note amount | $ | $ 2,671,000 | ||
Debt Maturity Date | Jan. 30, 2022 | ||
HealthCor Second Amendment Purchase Agreement [Member] | 2012 Senior Secured Convertible Notes [Member] | |||
Debt conversion price | $ / shares | $ 1.25 | ||
Number of shares the note may be converted into | Number | 8,000,000 |
AGREEMENT WITH HEALTHCOR (Det40
AGREEMENT WITH HEALTHCOR (Details Narrative 1) | Mar. 31, 2015USD ($)$ / sharesshares | Dec. 04, 2014USD ($)$ / sharesshares | Jan. 16, 2014USD ($)$ / sharesshares | Mar. 31, 2017USD ($)Number | Mar. 31, 2016USD ($) | Dec. 31, 2016USD ($) | Aug. 20, 2013USD ($) | Apr. 21, 2011USD ($) |
Beneficial conversion features for senior secured convertible notes | $ 63,586 | $ 516,844 | ||||||
Interest Expense | $ 3,220,762 | 3,151,557 | ||||||
HealthCor Third Amendment Purchase Agreement [Member] | ||||||||
Minimum cash balance required under existing loan documents | $ 5,000,000 | |||||||
HealthCor Third Amendment Purchase Agreement [Member] | Lower Range [Member] | ||||||||
Minimum cash balance required under existing loan documents | 4,000,000 | |||||||
HealthCor Third Amendment Purchase Agreement [Member] | Upper Range [Member] | ||||||||
Minimum cash balance required under existing loan documents | $ 5,000,000 | |||||||
HealthCor Fourth Amendment Purchase Agreement [Member] | 2014 Senior Secured Convertible Note#1 [Member] | ||||||||
Note amount | $ 2,329,000 | |||||||
Debt Maturity Date | Jan. 15, 2024 | |||||||
HealthCor Fourth Amendment Purchase Agreement [Member] | 2014 Senior Secured Convertible Note#2 [Member] | ||||||||
Note amount | $ 2,671,000 | |||||||
Debt Maturity Date | Jan. 15, 2024 | |||||||
HealthCor Fourth Amendment Purchase Agreement [Member] | 2014 Senior Secured Convertible Notes [Member] | ||||||||
Issuance of warrants | shares | 4,000,000 | |||||||
Exercise price of warrants | $ / shares | $ 0.40 | |||||||
Debt conversion price | $ / shares | $ 0.40 | |||||||
Number of shares the note may be converted into | Number | 19,000,000 | |||||||
HealthCor Fifth Amendment Purchase Agreement [Member] | ||||||||
Note amount | $ 6,000,000 | |||||||
Debt Maturity Date | Feb. 16, 2025 | |||||||
Issuance of warrants | shares | 3,692,308 | |||||||
Exercise price of warrants | $ / shares | $ 0.52 | |||||||
Debt conversion price | $ / shares | $ 0.52 | |||||||
Debt discount | $ 1,093,105 | |||||||
Interest Expense | $ 739,017 | 592,688 | ||||||
HealthCor Fifth Amendment Purchase Agreement [Member] | New Investors [Member] | ||||||||
Number of shares the note may be converted into | Number | 12,000,000 | |||||||
HealthCor Fifth Amendment Purchase Agreement [Member] | HealthCor Partners Fund [Member] | ||||||||
Number of shares the note may be converted into | Number | 2,000,000 | |||||||
HealthCor Sixth Amendment Purchase Agreement [Member] | ||||||||
Issuance of warrants | shares | 1,000,000 | |||||||
Exercise price of warrants | $ / shares | $ 0.53 | |||||||
Minimum cash balance required under existing loan documents | $ 5,000,000 | |||||||
Interest Expense | $ 14,450 | 14,450 | ||||||
Deferred debt costs | $ 378,000 | |||||||
HealthCor Sixth Amendment Purchase Agreement [Member] | Lower Range [Member] | ||||||||
Minimum cash balance required under existing loan documents | $ 2,000,000 | |||||||
HealthCor Purchase Agreement [Member] | ||||||||
Minimum cash balance required under existing loan documents | $ 2,000,000 | |||||||
Beneficial conversion features for senior secured convertible notes | $ 63,585 | $ 516,844 |
AGREEMENT WITH PDL BIOPHARMA,41
AGREEMENT WITH PDL BIOPHARMA, INC. (Details Narrative) | Oct. 07, 2015Number$ / shares | Jun. 26, 2015USD ($)Number$ / sharesshares | Mar. 31, 2017USD ($) | Mar. 31, 2016USD ($) | Dec. 31, 2016USD ($) |
Restricted cash | $ 3,250,000 | $ 3,250,000 | |||
PDL BioPharma, Inc (Administrative Agent and Lender) [Member] | |||||
Debt face amount | $ 40,000,000 | ||||
Description of payment terms | Interest only payments for the first eight interest payment dates and principal plus interest payments will commence on the ninth interest payment date. We may elect to pay a portion of the interest due in the form of additional loans (interest paid in kind) during the first eight interest payment dates.Each tranche will mature on the fifth anniversary of the date borrowed. We may elect to prepay the Loans at any time without any premium or penalty, subject to certain conditions. | ||||
Description of collateral | Secured by a pledge of substantially all of the assets of the Company and certain of its domestic subsidiaries. | ||||
Minimum cash balance required under existing loan documents | $ 3,250,000 | ||||
Restricted cash | 3,250,000 | ||||
PDL BioPharma, Inc (Administrative Agent and Lender) [Member] | Warrants [Member] | |||||
Number common stock called | shares | 4,444,445 | ||||
Exercise price (in dollars per shares) | $ / shares | $ 0.45 | ||||
Warrant expiration date | Jun. 26, 2025 | ||||
Fair value of warrant | $ 1,257,778 | ||||
Amortized interest expense | 44,922 | $ 44,922 | |||
Deferred financing costs | 805,917 | ||||
Amortized deferred financing costs | $ 27,849 | $ 27,849 | |||
PDL BioPharma, Inc (Administrative Agent and Lender) [Member] | Tranche One Debt [Member] | |||||
Debt face amount | $ 20,000,000 | ||||
Description of debt milestone placement | In the event that a milestone relating to the placement of 9,000 billable units occurs on or before October 31, 2015. | ||||
Interest rate | 13.50% | ||||
Number of billable units | Number | 9,000 | ||||
Date of first required debt repyment | Jan. 8, 2018 | ||||
Debt periodic repayment | $ 1,666,667 | ||||
PDL BioPharma, Inc (Administrative Agent and Lender) [Member] | Tranche Two Debt [Member] | |||||
Debt face amount | $ 20,000,000 | ||||
Description of debt milestone placement | (i) the placement of 27,750 billable units and (ii) the Company recording earnings before interest, tax, depreciation, and amortization (EBITDA) of not less than $7,000,000 on an annualized basis for the three calendar month period prior to the funding (on or before June 30, 2017). | ||||
Interest rate | 13.00% | ||||
Number of billable units | Number | 27,250 | ||||
Earning before interest, tax, depreciation, and amortization milestone | $ 7,000,000 | ||||
Increase of interest rate if default occurs | 5.00% | ||||
PDL BioPharma, Inc (Administrative Agent and Lender) - First Amendment [Member] | Warrants [Member] | |||||
Exercise price (in dollars per shares) | $ / shares | $ 0.45 | ||||
PDL BioPharma, Inc (Administrative Agent and Lender) - First Amendment [Member] | Tranche Two Debt [Member] | |||||
Description of debt milestone placement | revision to the Tranche Two Milestone, which changed from a minimum of 27,750 billable units (defined as one unit for each room control platform and two units for each nurse station monitor) to 31,500 Bed Equivalent Units (defined as a billable unit plus 14 units for each head-end server operating as the communication center and fractional units for mobile assets as applicable). | ||||
Number of billable units | Number | 31,500 | ||||
PDL BioPharma, Inc (Administrative Agent and Lender) - Restated Amendment [Member] | Warrants [Member] | |||||
Exercise price (in dollars per shares) | $ / shares | $ 0.40 |