Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2019 | Aug. 07, 2019 | |
Schedule Of Warrants Activities Used In Derivative Liability [Table Text Block] | ||
Entity Registrant Name | Xtant Medical Holdings, Inc. | |
Entity Central Index Key | 0001453593 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2019 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business Flag | true | |
Entity Emerging Growth Company | false | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 13,161,762 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2019 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 |
Current Assets: | ||
Cash and cash equivalents | $ 7,318,000 | $ 6,797,000 |
Trade accounts receivable, net of allowance for doubtful accounts of $1,223 and $2,140, respectively | 8,565,000 | 9,990,000 |
Inventories, net | 15,828,000 | 17,301,000 |
Prepaid and other current assets | 592,000 | 589,000 |
Total current assets | 32,303,000 | 34,677,000 |
Property and equipment, net | 5,600,000 | 7,174,000 |
Right-of-use asset, net | 2,296,000 | |
Goodwill | 3,205,000 | 3,205,000 |
Intangible assets, net | 544,000 | 573,000 |
Other assets | 549,000 | 793,000 |
Total Assets | 44,497,000 | 46,422,000 |
Current Liabilities: | ||
Accounts payable | 3,194,000 | 6,465,000 |
Accrued liabilities | 5,867,000 | 5,150,000 |
Warrant derivative liability | 21,000 | 10,000 |
Current portion of lease liability | 511,000 | |
Current portion of financing lease obligations | 337,000 | 426,000 |
Total current liabilities | 9,930,000 | 12,051,000 |
Long-term Liabilities: | ||
Lease liability, less current portion | 1,796,000 | |
Financing lease obligation, less current portion | 16,000 | 204,000 |
Long-term debt, less issuance costs | 73,831,000 | 77,939,000 |
Total Liabilities | 85,573,000 | 90,194,000 |
Commitments and Contingencies (note 10) | ||
Stockholders' Equity (Deficit): | ||
Preferred stock, $0.000001 par value; 10,000,000 shares authorized; no shares issued and outstanding | ||
Common stock, $0.000001 par value; 50,000,000 shares authorized; 13,161,762 shares issued and outstanding as of June 30, 2019 and 13,172,179 shares issued and outstanding as of December 31, 2018 | ||
Additional paid-in capital | 178,707,000 | 171,273,000 |
Accumulated deficit | (219,783,000) | (215,045,000) |
Total Stockholders' Equity (Deficit) | (41,076,000) | (43,772,000) |
Total Liabilities & Stockholders' Equity (Deficit) | $ 44,497,000 | $ 46,422,000 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Trade accounts receivable, allowance for doubtful accounts | $ 1,223 | $ 2,140 |
Preferred stock, par value | $ 0.000001 | $ 0.000001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | ||
Preferred stock, shares outstanding | ||
Common stock, par value | $ 0.000001 | $ 0.000001 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 13,161,762 | 13,172,179 |
Common Stock, shares outstanding | 13,161,762 | 13,172,179 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Revenue | ||||
Orthopedic product sales | $ 15,197 | $ 18,653 | $ 31,883 | $ 36,483 |
Other revenue | 74 | 88 | 114 | 191 |
Total Revenue | 15,271 | 18,741 | 31,997 | 36,674 |
Cost of sales | 5,365 | 6,266 | 11,278 | 11,968 |
Gross Profit | 9,906 | 12,475 | 20,719 | 24,706 |
Operating Expenses | ||||
General and administrative | 4,041 | 3,498 | 8,359 | 6,885 |
Sales and marketing | 6,072 | 8,545 | 12,814 | 16,894 |
Research and development | 210 | 418 | 472 | 832 |
Depreciation and amortization | 146 | 1,041 | 305 | 2,045 |
Restructuring expenses | 1,234 | 1,968 | ||
Total Operating Expenses | 10,469 | 14,736 | 21,950 | 28,624 |
Loss from Operations | (563) | (2,261) | (1,231) | (3,918) |
Other (Expense) Income | ||||
Interest expense | (1,301) | (2,820) | (3,319) | (6,366) |
Change in warrant derivative liability | 4 | 79 | (11) | 41 |
Other (expense) income | (57) | (132) | (12) | |
Total Other (Expense) | (1,354) | (2,741) | (3,462) | (6,337) |
Net Loss Before Provision for Income Taxes | (1,917) | (5,002) | (4,693) | (10,255) |
Provision for income taxes | (22) | (45) | ||
Net Loss | $ (1,939) | $ (5,002) | $ (4,738) | $ (10,255) |
Net loss per share: | ||||
Basic | $ (0.15) | $ (0.38) | $ (0.36) | $ (1) |
Dilutive | $ (0.15) | $ (0.38) | $ (0.36) | $ (1) |
Shares used in the computation: | ||||
Basic | 13,161,762 | 13,085,668 | 13,166,136 | 10,299,090 |
Dilutive | 13,161,762 | 13,085,668 | 13,166,136 | 10,299,090 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Equity (Unaudited) - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-In Capital [Member] | Retained Deficit [Member] | Total |
Beginning Balance at Dec. 31, 2017 | $ 86,247 | $ (144,946) | $ (58,699) | |
Beginning Balance, Shares at Dec. 31, 2017 | 1,514,899 | |||
Stock-based compensation | $ 363 | $ 363 | ||
Issuance of common stock | $ 79,199 | $ 79,199 | ||
Issuance of common stock, Shares | 11,630,406 | |||
Forfeiture of restricted stock | ||||
Forfeiture of restricted stock, shares | ||||
Debt extinguishment | ||||
Issuance of warrant | ||||
Net loss | (10,255) | (10,255) | ||
Ending Balance at Jun. 30, 2018 | 165,809 | (155,201) | 10,608 | |
Ending Balance, Shares at Jun. 30, 2018 | 13,145,305 | |||
Beginning Balance at Mar. 31, 2018 | $ 165,808 | $ (150,199) | $ 15,609 | |
Beginning Balance, Shares at Mar. 31, 2018 | 13,077,468 | |||
Stock-based compensation | ||||
Issuance of common stock | $ 1 | $ 1 | ||
Issuance of common stock, Shares | 67,837 | |||
Forfeiture of restricted stock | ||||
Forfeiture of restricted stock, shares | ||||
Debt extinguishment | ||||
Issuance of warrant | ||||
Net loss | (5,002) | (5,002) | ||
Ending Balance at Jun. 30, 2018 | 165,809 | (155,201) | 10,608 | |
Ending Balance, Shares at Jun. 30, 2018 | 13,145,305 | |||
Beginning Balance at Dec. 31, 2018 | $ 171,273 | $ (215,045) | (43,772) | |
Beginning Balance, Shares at Dec. 31, 2018 | 13,172,179 | |||
Stock-based compensation | $ 161 | 161 | ||
Issuance of common stock | ||||
Issuance of common stock, Shares | ||||
Forfeiture of restricted stock | ||||
Forfeiture of restricted stock, shares | (10,417) | |||
Debt extinguishment | $ 7,264 | $ 7,264 | ||
Issuance of warrant | 9 | 9 | ||
Net loss | (4,738) | (4,738) | ||
Ending Balance at Jun. 30, 2019 | 178,707 | (219,783) | (41,076) | |
Ending Balance, Shares at Jun. 30, 2019 | 13,161,762 | |||
Beginning Balance at Mar. 31, 2019 | $ 178,668 | $ (217,844) | $ (39,176) | |
Beginning Balance, Shares at Mar. 31, 2019 | 13,161,762 | |||
Stock-based compensation | $ 39 | $ 39 | ||
Issuance of common stock | ||||
Issuance of common stock, Shares | ||||
Forfeiture of restricted stock | ||||
Forfeiture of restricted stock, shares | ||||
Debt extinguishment | ||||
Issuance of warrant | ||||
Net loss | (1,939) | (1,939) | ||
Ending Balance at Jun. 30, 2019 | $ 178,707 | $ (219,783) | $ (41,076) | |
Ending Balance, Shares at Jun. 30, 2019 | 13,161,762 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Operating activities: | ||
Net loss | $ (4,738) | $ (10,255) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation and amortization | 1,559 | 3,227 |
Loss on disposal of fixed assets | 92 | 205 |
Non-cash interest | 3,272 | 6,205 |
Non-cash rent | 11 | |
Non-cash stock option expense/change in derivative warrant liability | 172 | 364 |
Provision for losses on accounts receivable and inventory | 750 | 83 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 1,403 | 2,152 |
Inventories | 955 | (388) |
Prepaid and other assets | 242 | 1,120 |
Accounts payable | (3,481) | (1,948) |
Accrued liabilities | 717 | (421) |
Net cash provided by operating activities | 954 | 344 |
Investing activities: | ||
Purchases of property and equipment and intangible assets | (211) | (288) |
Proceeds from sale of fixed assets | 163 | |
Net cash used in investing activities | (48) | (288) |
Financing activities: | ||
Payments on financing leases | (277) | (167) |
Costs associated with Second Amended and Restated Credit Agreement | (108) | |
Costs associated with private placement and convertible debt conversion/exchange | (3,507) | |
Proceeds from equity private placement | 6,810 | |
Proceeds from issuance of stock | 1 | |
Net cash (used in) provided by financing activities | (385) | 3,137 |
Net change in cash and cash equivalents | 521 | 3,193 |
Cash and cash equivalents at beginning of period | 6,797 | 2,856 |
Cash and cash equivalents at end of period | $ 7,318 | $ 6,049 |
Business Description, Basis of
Business Description, Basis of Presentation and Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business Description, Basis of Presentation and Summary of Significant Accounting Policies | (1) Business Description, Basis of Presentation and Summary of Significant Accounting Policies Business Description and Basis of Presentation The accompanying condensed consolidated financial statements include the accounts of Xtant Medical Holdings, Inc. (“Xtant”), a Delaware corporation, and its wholly owned subsidiaries, Xtant Medical, Inc. (“Xtant Medical”), a Delaware corporation, Bacterin International, Inc. (“Bacterin”), a Nevada corporation, and X-spine Systems, Inc. (“X-spine”), an Ohio corporation (Xtant, Xtant Medical, Bacterin, and X-spine are jointly referred to herein as the “Company” or sometimes “we”, “our,” or “us”). All intercompany balances and transactions have been eliminated in consolidation. Xtant is a global medical technology company focused on the design, development, and commercialization of a comprehensive portfolio of orthobiologics and spinal implant systems to facilitate spinal fusion in complex spine, deformity, and degenerative procedures. The accompanying condensed consolidated financial statements of Xtant for the three and six months ended June 30, 2019 and 2018 are unaudited and are prepared in accordance with accounting principles generally accepted in the United States of America. They do not include all disclosures required by generally accepted accounting principles for annual consolidated financial statements, but in the opinion of management, include all adjustments, consisting only of normal recurring items, necessary for a fair presentation. Certain prior year amounts have been reclassified to conform with current year presentation. Interim results are not necessarily indicative of results that may be achieved in the future for the full year ending December 31, 2019. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto, which are included in Xtant’s Annual Report on Form 10-K for the year ended December 31, 2018. The accounting policies set forth in those annual consolidated financial statements are the same as the accounting policies utilized in the preparation of these condensed consolidated financial statements, except as modified for appropriate interim consolidated financial statement presentation. As described in more detail below, effective as of February 13, 2018, the Company effected a 1-for-12 reverse split of its common stock (the “Reverse Stock Split”). The Reverse Stock Split is reflected in the share amounts in all periods presented in this report. During the preparation of this Quarterly Report on Form 10-Q, the Company identified an immaterial misstatement on the condensed consolidated balance sheet as of June 30, 2018. The Accumulated deficit line item was overstated by $320 thousand and should have been reported as $155.2 million instead of $155.5 million. The Total stockholders’ equity (deficit) and Total liabilities and stockholders’ equity (deficit) line items in the condensed consolidated balance sheet as of June 30, 2018 were correct. In addition, the Accumulated deficit line item in subsequent Quarterly Reports on Form 10-Q and in the Annual Report on Form 10-K for the year ended December 31, 2018 were correct. Management evaluated the effect of this misstatement on the prior period and concluded that the prior period was not materially misstated. Accordingly, the misstatement has been corrected in the second quarter of 2019 and in this Quarterly Report on Form 10-Q. Specifically, the June 30, 2018 balance under the Retained deficit column in the condensed consolidated statements of equity for the three and six months ended June 30, 2018 reflects a retained deficit of $155.2 million instead of $155.5 million. Corporate Restructuring Restructuring Agreement On January 11, 2018, we entered into a Restructuring and Exchange Agreement (the “Restructuring Agreement”) with ROS Acquisition Offshore LP, OrbiMed Royalty Opportunities II, LP (collectively referred to herein as the “Investors”), Bruce Fund, Inc., Park West Partners International, Limited (“PWPI”), Park West Investors Master Fund, Limited (“PWIMF”), and Telemetry Securities, L.L.C., collectively referred to herein as the “Holders.” Pursuant to the Restructuring Agreement, and following the execution of the Sixth Amendment to the 2017 Notes, described in the “Debt” and “Equity” sections below, on January 17, 2018, the Investors converted 6.00% convertible senior unsecured notes due 2021, plus accrued and unpaid interest, at the $9.11 per share conversion rate originally provided thereunder (the “2017 Notes”), into 189,645 shares of our common stock. On February 14, 2018, after giving effect to the Reverse Stock Split (described below), the $70.3 million aggregate principal amount of our then outstanding 6.00% convertible senior unsecured notes due 2021 held by the Holders (the “Remaining Notes”), plus accrued and unpaid interest, were exchanged for newly-issued shares of our common stock at an exchange rate of 138.8889 shares per $1,000 principal amount of the Remaining Notes, for an exchange price of $7.20 per share (the “Notes Exchange”). This resulted in the issuance of 10,401,309 shares of our common stock to the Holders and the Investors acquiring an approximately 70% controlling interest in our outstanding shares of common stock. Upon the completion of the Notes Exchange, all outstanding obligations under our convertible senior secured notes were satisfied in full, and the Indentures governing such notes were discharged. Pursuant to the terms of the Restructuring Agreement, we commenced a rights offering to allow our stockholders as of a record date of April 27, 2018 to purchase up to an aggregate of 1,137,515 shares of our common stock at a subscription price of $7.20 per share. The rights offering expired on June 18, 2018. We issued 129 shares of common stock in the rights offering and received $0.9 thousand gross proceeds. Amended and Restated Certificate of Incorporation On February 13, 2018, following a special meeting of our stockholders, we filed with the Secretary of State of the State of Delaware a Certificate of Amendment to our Charter (the “Certificate Amendment”). The Certificate Amendment amended and restated our Charter (the “Charter”) to, among other things: ● effect the Reverse Stock Split; ● after giving effect to the Reverse Stock Split, decrease the number of authorized shares of common stock available for issuance from 95,000,000 to 50,000,000 and increase the number of authorized shares of preferred stock available for issuance from 5,000,000 to 10,000,000; ● authorize the Board of Directors (“Board”) to increase or decrease the number of shares of any series of our capital stock, provided that such increase or decrease does not exceed the number of authorized shares or represent less than the number of shares then outstanding; ● authorize the Board to issue new series of preferred stock without approval of the holders of common stock or other series of preferred stock, with such powers, preferences, and rights as may be determined by the Board; ● authorize a majority of the Board to fix the number of our directors; ● indemnify the members of the Board to the fullest extent permitted by law; ● remove the classification of the Board to require all directors to be elected annually; ● provide that special meetings of our stockholders may only be called by the Board, the chairman of the Board, or our chief executive officer; ● provide that no stockholder will be permitted cumulative voting at any election of directors; ● elect not to be governed by Section 203 of the Delaware General Corporation Law (the “DGCL”); ● elect the Court of Chancery of the State of Delaware to be the exclusive forum for any derivative action or proceeding brought on our behalf, any action asserting a breach of a fiduciary duty owed by any of our directors, officers, or other employees, any action under the DGCL, our Charter, or bylaws, or any actions governed by the internal affairs doctrine; and ● require the vote of at least two-thirds of the voting power of the then outstanding shares of our capital stock to amend or repeal certain provisions of our Charter. The Reverse Stock Split became effective as of 5:00 p.m. Eastern Time on February 13, 2018, and our common stock began trading on a split-adjusted basis when the market opened on February 14, 2018. Upon the effectiveness of the Reverse Stock Split, every 12 shares of our issued and outstanding common stock automatically converted into one share of common stock, without any change in the par value per share. In addition, a proportionate adjustment was made to the per share exercise price and the number of shares issuable upon the exercise of all of our outstanding stock options and convertible securities to purchase shares of common stock and the number of shares underlying restricted stock awards and reserved for issuance pursuant to our equity incentive compensation plan. Any fraction of a share of common stock that would otherwise have resulted from the Reverse Stock Split was rounded down to the nearest whole share. All share and per share amounts have been retroactively restated to reflect the Reverse Stock Split. Private Placement SPA On February 14, 2018, we entered into a Securities Purchase Agreement (the “Private Placement SPA”) with the Investors pursuant to which the Investors purchased from us an aggregate of 945,819 shares of our common stock at a price of $7.20 per share for aggregate proceeds of $6.8 million. Investor Rights Agreement Effective February 14, 2018, we entered into an Investor Rights Agreement (the “Investor Rights Agreement”) with the Holders. Under the Investor Rights Agreement, the Investors are permitted to nominate a majority of our directors and designate the chairperson of the Board at subsequent annual meetings, as long as the Investors maintain an ownership threshold in the Company of at least 40% of the then outstanding common stock (the “Ownership Threshold”). If the Investors are unable to maintain the Ownership Threshold, the Investor Rights Agreement contemplates a reduction of nomination rights commensurate with their ownership interests. For so long as the Ownership Threshold is met, we must obtain the approval of the Investors to proceed with the following actions: (i) issue new securities; (ii) incur over $0.25 million of debt in a fiscal year; (iii) sell or transfer over $0.25 million of our assets or businesses or our subsidiaries in a fiscal year; (iv) acquire over $0.25 million of assets or properties in a fiscal year; (v) make capital expenditures over $0.125 million individually or $1.5 million in the aggregate during a fiscal year; (vi) approve our annual budget; (vii) hire or terminate our chief executive officer; (viii) appoint or remove the chairperson of the Board; and (ix) make loans to, make investments in, or purchase, or permit any subsidiary to purchase, any stock or other securities in another entity in excess of $0.25 million in a fiscal year. As long as the Ownership Threshold is met, we may not increase the size of the Board beyond seven directors without the approval of a majority of the directors nominated by the Investors. The Investor Rights Agreement grants the Holders the right to purchase from us a pro rata amount of any new securities that we may propose to issue and sell. The Investor Rights Agreement may be terminated (a) upon the mutual written agreement of all the parties, (b) upon written notice of the Company or an Investor, if such Investor’s ownership percentage of our then outstanding common stock is less than 10%, or (c) upon written notice by the Investors. PWPI and PWIMF’s right to purchase from us a pro rata amount of any new securities will also terminate at such time as their aggregate ownership percentage of our then outstanding common stock is less than 8.5%. Registration Rights Agreement Effective February 14, 2018, we entered into a Registration Rights Agreement (the “Registration Rights Agreement”) with the Holders. The Registration Rights Agreement requires us to, among other things, file with the U.S. Securities and Exchange Commission (“SEC”) a shelf registration statement within 90 days of the date of the Registration Rights Agreement covering the resale, from time to time, of our common stock issued. The registration statement became effective on June 4, 2018. Second Amended and Restated Bylaws On February 14, 2018, we amended and restated our current bylaws by adopting the Second Amended and Restated Bylaws of the Company (the “Amended Bylaws”). The Amended Bylaws amended our existing bylaws to, among other things: ● provide for annual and special meetings of stockholders to be held through remote communications; ● provide for the election of any directors not elected at an annual meeting of stockholders to be elected at a special meeting of stockholders; ● declassify the Board into one group of directors that will hold office until the subsequent annual meeting of stockholders and until the election and qualification of such directors’ respective successors; ● provide for the filling of a new directorship or director vacancy by the affirmative vote of the holders of a majority of the voting power of our shares of stock; ● allow for a majority of the Board present to adjourn a Board meeting if a quorum is not met; ● unless otherwise restricted in the Amended Bylaws or our Charter, provide the Board with the authority to fix the compensation of directors, including, without limitation, compensation for services as members of Board committees; ● allow us to enter into an agreement with a stockholder to restrict the transfer of shares held by such stockholder in any manner not prohibited by the DGCL; and ● allow the Board to declare dividends on our capital stock, subject to any provisions of our Charter and applicable law. Concentrations and Credit Risk The Company’s accounts receivable are due from a variety of health care organizations and distributors throughout the world. No single customer accounted for more than 10% of revenue or accounts receivable for the comparable periods. The Company provides for uncollectible amounts when specific credit issues arise. Management believes that all significant credit risks have been identified at June 30, 2019. Use of Estimates The preparation of the consolidated financial statements requires management of the Company to make a number of estimates and assumptions relating to the reported amount of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the period. Significant estimates include the carrying amount of property and equipment, goodwill and intangible assets and liabilities, valuation allowances for trade receivables, inventory and deferred income tax assets and liabilities, valuation of the warrant derivative liability, current and long-term financing lease obligations and corresponding right-of-use asset, and estimates for the fair value of long-term debt, stock options, grants, and other equity awards upon which the Company determines stock-based compensation expense. Actual results could differ from those estimates. Long-Lived Assets Long-lived assets, including intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the estimated fair value of the assets. Management reviewed the assumptions of intangible assets as of June 30, 2019 and determined that no impairment of the carrying value of the long-lived assets existed during the second quarter of 2019. Goodwill Goodwill represents the excess of costs over fair value of assets of businesses acquired. Goodwill and intangible assets acquired in a purchase business combination and determined to have indefinite useful lives are not amortized. Instead, they are tested for impairment at least annually, and whenever events or circumstances indicate, the carrying amount of the asset may not be recoverable. The Company conducts its impairment test on an annual basis and will review the analysis assumptions on a quarterly basis. We test goodwill for impairment at the reporting unit level, which is an operating segment, or one level below an operating segment, referred to as a component. A component of an operating segment is a reporting unit if the component constitutes a business for which discrete financial information is available and segment management regularly reviews the operating results of that component. Revenue Recognition The Company adopted the provisions of Accounting Standards Update (“ASU”) No. 2014-09, Topic 606, Revenue from Contracts with Customers Disaggregation of Revenue The Company operates in one reportable segment with our net revenue derived primarily from the sale of orthobiologics and spinal implant products across North America, Europe, Asia Pacific, and Latin America. Sales are reported net of returns. No rebates, group purchasing organization fees, or other customer allowances are present and so are not relevant to net revenue determination. The following table presents revenues from these product lines for the three and six months ended June 30, 2019 and 2018 (in thousands): Three Months Ended Percentage of Three Months Ended Percentage of June 30, 2019 Total Revenue June 30, 2018 Total Revenue Orthobiologics $ 11,020 72 % $ 12,713 68 % Spinal implant $ 4,177 27 % $ 5,940 32 % Other revenue $ 74 1 % $ 88 0 % Total revenue $ 15,271 100 % $ 18,741 100 % Six Months Ended Percentage of Six Months Ended Percentage of June 30, 2019 Total Revenue June 30, 2018 Total Revenue Orthobiologics $ 23,020 72 % $ 24,818 68 % Spinal implant $ 8,863 27 % $ 11,665 31 % Other revenue $ 114 1 % $ 191 1 % Total revenue $ 31,997 100 % $ 36,674 100 % Performance Obligations The Company’s contracts do not include a right of acceptance or a right to cancel. Therefore, our process for recognizing revenue does not require an evaluation of whether acceptance is received or a right to cancel has expired. Further, the Company does not incur upfront costs or exclusivity fees in conjunction with entering into a customer contract. The Company’s customer contracts do not provide for percentage of completion performance measures or contingent consideration. In the normal course of business, the Company accepts returns of products that have not been implanted. Product returns are not material to the Company’s consolidated statements of operations. The Company accounts for shipping and handling activities as a fulfillment cost rather than a separate performance obligation. The Company’s policy is to record revenue net of any applicable sales, use, or excise taxes. Payment terms are generally net 30 days from invoice date, and some customers are offered discounts for early pay. Contract Assets and Liabilities The Company does not have deferred or unearned revenue arrangements with its customers that would give rise to contract liabilities. The Company recognizes sales commissions as incurred because the amortization period is less than one year. Additionally, the Company does not recognize unbilled receivables or progress payments to be billed that would result in a contract asset. All pricing and agreements are completed based on the contracted individual unit price; no other methods of determining price are allowed within the Company’s sales agreements. Therefore, no contract assets or contract liabilities are recorded in our condensed consolidated balance sheets as of June 30, 2019 and 2018. Research and Development Research and development costs, which are principally related to internal costs for the development of new products, are expensed as incurred. Net Loss Per Share Basic net income (loss) per share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding. Shares issued during the period and shares reacquired during the period are weighted for the portion of the period that they were outstanding. Diluted net income (loss) per share is computed in a manner consistent with that of basic earnings per share while giving effect to all potentially dilutive shares of common stock outstanding during the period, which include the assumed exercise of stock options and warrants using the treasury stock method. Diluted net loss per share was the same as basic net loss per share for the six months ended June 30, 2019 and 2018, as shares issuable upon the exercise of stock options and warrants were anti-dilutive as a result of the net losses incurred for those periods. Dilutive earnings per share are not reported, as the effects of including 3,135,973 and 558,161 outstanding stock options, restricted stock units and warrants for the six months ended June 30, 2019 and 2018, respectively, are anti-dilutive. Fair Value of Financial Instruments The carrying values of financial instruments, including trade accounts receivable, accounts payable, accrued liabilities, and long-term debt, approximate their fair values based on terms and related interest rates. The Company follows a framework for measuring fair value. The framework provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described as follows: Level 1: Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets. Level 2: Inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. Level 3: Inputs to the valuation methodology are unobservable and significant to the fair value measurement. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. During the six months ended June 30, 2019 and 2018, there were no reclassifications in financial assets or liabilities between Level 1, 2, or 3 categories. The following table sets forth by level, within the fair value hierarchy, our liabilities that are measured at fair value on a recurring basis. Warrant derivative liability (in thousands): As of June 30, 2019 As of December 31, 2018 Level 1 — — Level 2 — — Level 3 $ 21 $ 10 The valuation technique used to measure fair value of the warrant liability is based on a lattice valuation model and significant assumptions and inputs determined by us. See Note 9, “ Warrants Level 3 Changes The following is a reconciliation of the beginning and ending balances for liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the six months ended June 30, 2019: Warrant derivative liability (in thousands): Balance at January 1, 2019 $ 10 Loss recognized in earnings 11 Balance at June 30, 2019 $ 21 During the six months ended June 30, 2019, the Company did not change any of the valuation techniques used to measure its liabilities at fair value. Recent Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2016-13, Financial Instruments–Credit losses: Measurement of Credit Losses on Financial Instruments Financial Instruments–Credit Loss Financial Instruments–Credit Losses (Topic 326): Targeted Transition Relief In August 2018, the FASB issued ASU No. 2018-15, Intangibles–Goodwill and Other–Internal-Use Software (Subtopic 350-40) |
Inventories, Net
Inventories, Net | 6 Months Ended |
Jun. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Inventories, Net | (2) Inventories, Net Inventories consist of the following (in thousands): June 30, 2019 December 31, 2018 Raw materials $ 3,465 $ 3,519 Work in process 1,480 949 Finished goods 23,534 25,235 Gross inventories 28,479 29,703 Reserve for obsolescence (12,651 ) (12,402 ) Total inventories, net $ 15,828 $ 17,301 The Company provides implants and biologic inventory on consignment through its various sales channels to logistically place the inventory near the anticipated surgical location. Consigned inventory was approximately $9.2 million and $8.8 million at June 30, 2019 and December 31, 2018, respectively. |
Property and Equipment, Net
Property and Equipment, Net | 6 Months Ended |
Jun. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | (3) Property and Equipment, Net Property and equipment, net are as follows (in thousands): June 30, 2019 December 31, 2018 Equipment $ 4,082 $ 4,145 Computer equipment 455 481 Computer software 570 570 Furniture and fixtures 99 164 Leasehold improvements 3,955 3,941 Vehicles 10 10 Surgical instruments 10,794 10,772 Total cost 19,965 20,083 Less: accumulated depreciation (14,365 ) (12,909 ) Property and equipment, net $ 5,600 $ 7,174 The Company deploys certain surgical instruments through its various sales channels for use with purchased implants during surgical procedures. The instruments are classified as non-current assets within property and equipment and depreciated using the straight-line method over a five-year useful life. The net book value of consigned surgical instruments was approximately $4.9 million and $4.4 million at June 30, 2019 and December 31, 2018, respectively. Instruments are recorded at cost and are carried at net book value (cost less accumulated depreciation). Depreciation expense related to property and equipment, including property under capital lease, for the first six months of 2019 and 2018 was $1.5 million and $1.6 million, respectively. The Company leases certain equipment under capital leases. For financial reporting purposes, minimum lease payments relating to the assets have been capitalized. As of June 30, 2019, the Company has recorded $1.6 million gross assets in Equipment and $1.0 million of accumulated depreciation. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 6 Months Ended |
Jun. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | (4) Goodwill and Intangible Assets Goodwill represents the excess of costs over fair value of assets on businesses acquired associated with the acquisition of X-spine. During the fourth quarter of 2018, several developments in our business led us to conclude that a goodwill impairment charge was appropriate. First, in connection with our annual planning process for 2019, we determined that the revenue growth rates for our fixation business likely would not be consistent with the expectations on which our initial 2018 annual plan was built. Second, in connection with our annual planning process for 2019, we curtailed a new sales channel strategy that we had implemented in 2018 to build a direct sales force since we determined that the sales channel strategy was not generating the benefits that we had originally thought it would. We also determined by the end of 2018 that our assumptions regarding the expansion of our international business were inaccurate and likely would not prove to be true in the near future in light of our business priorities, international regulatory issues and anticipated funding requirements. In its evaluation of goodwill, the Company performs an assessment of qualitative factors to determine if it is more-likely-than-not that goodwill might be impaired. We considered factors such as, but not limited to, macroeconomic conditions, industry and market considerations, and financial performance, including the planned revenue and earnings of X-spine. The results from the assessment and a Step 1 analysis allowed the Company to conclude that a further valuation of goodwill was necessary, as indicators of impairment existed as of December 31, 2018. As part of the Step 1 analysis, we updated the discounted cash flow analysis used to determine the Company’s initial fair value as of December 31, 2018. Based on the results of the impairment test and analysis, we concluded that the fair value of the Company was less than its carrying amount. Based on the results of the impairment test and analysis, we concluded that application of a Step 2 goodwill impairment test was necessary to determine the amount of impairment loss, if any. We engaged a third-party specialist to assist in the valuation. We compared the carrying value of the assets, including cash, and non-interest-bearing liabilities to the derived enterprise value of the business. As a result, we recorded a non-cash goodwill impairment charge of $38.3 million. The remaining goodwill was valued at $3.2 million as of December 31, 2018. This amount remains unchanged as of June 30, 2019. Intangible assets consist of various patents with regard to processes for our products and intangible assets associated with the acquisition of X-spine. Given the level of impairment initially indicated by the Step 1 analysis, an ASC 360, Property, Plant and Equipment The following table sets forth information regarding intangible assets (in thousands): June 30, 2019 December 31, 2018 Patents $ 847 $ 847 Accumulated amortization (303 ) (274 ) Intangible assets, net $ 544 $ 573 The following is a summary of estimated future amortization expense for intangible assets as of June 30, 2019 (in thousands): Remainder of 2019 $ 30 2020 58 2021 58 2022 58 2023 58 Thereafter 282 Total $ 544 |
Accrued Liabilities
Accrued Liabilities | 6 Months Ended |
Jun. 30, 2019 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities | (5) Accrued Liabilities Accrued liabilities consist of the following (in thousands): June 30, 2019 December 31, 2018 Wages/commissions payable $ 3,808 $ 3,332 Other accrued liabilities 2,059 1,818 Accrued liabilities $ 5,867 $ 5,150 |
Debt
Debt | 6 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
Debt | (6) Debt Convertible Note Indenture During the first quarter of 2018 in connection with our Restructuring, all of the outstanding 6.00% convertible senior unsecured notes due 2021 were converted into shares of our common stock and the Indenture governing such notes was discharged. Twenty-Second Amendment to the Amended and Restated Credit Agreement Effective January 30, 2018, the Company and the Investors entered into the Twenty-Second Amendment to the Amended and Restated Credit Agreement dated July 27, 2015, which amended the Amended and Restated Credit Agreement by and between Bacterin and ROS Acquisition Offshore LP (collectively, the “Prior Credit Agreement” and the facility created under such agreement, the “Credit Facility”). This amendment further deferred the Company’s accrued interest payment date for the fiscal quarters ended on December 31, 2016, March 31, 2017, June 30, 2017, September 30, 2017, and December 31, 2017, until February 28, 2018. Twenty-Third Amendment to the Prior Credit Agreement Effective February 14, 2018, the Company and the Investors entered into the Twenty-Third Amendment to the Prior Credit Agreement, which further amended the Prior Credit Agreement and terms of the Credit Facility. As of this amendment, the interest payable was carried forward. As modified, the interest rate options within the Credit Facility was as follows: (i) through December 31, 2018, we had the option at our sole discretion (a) to pay PIK Interest at LIBOR (as defined in the Credit Facility) plus 12% or (b) pay cash interest at LIBOR plus 10%; (ii) beginning January 1, 2019 through June 30, 2019, we had the option at our sole discretion to either (a) pay PIK Interest at LIBOR plus 15% or (b) pay cash interest at LIBOR plus 10%; and (iii) beginning July 1, 2019 through the maturity date of the Credit Facility, we will pay cash interest at LIBOR plus 10%. The amendment also reduced the prepayment or repayment fee under the Credit Facility to 1%. This amendment also modified the financial covenants in the Prior Credit Agreement, including removing the minimum revenue covenant and providing a minimum liquidity covenant, a consolidated leverage ratio covenant, and a minimum consolidated EBITDA covenant, all as defined in the Prior Credit Agreement. Twenty-Fourth Amendment to the Prior Credit Agreement On September 17, 2018, the Company and the Investors entered into the Twenty-Fourth Amendment to the Prior Credit Agreement (the “24 th th Due to the interest rate relief provided by the 24 th Debt Twenty-Fifth Amendment to the Prior Credit Agreement Also on September 17, 2018, the Company and the Investors entered into the Twenty-Fifth Amendment to the Prior Credit Agreement (the “25th Amendment”), which further amended the Prior Credit Agreement and terms of the Credit Facility, effective as of August 1, 2018. Under the terms of the 25th Amendment: ● no interest was charged on the Loans under the Credit Facility from July 1, 2018, until December 31, 2018; ● the Optional PIK Interest (as such term is defined in the Prior Credit Agreement) was decreased from 15% plus the LIBO Rate (as such term is defined in the Amended and Restated Credit Agreement) to 10% plus the LIBO Rate, with a 2.3125% floor; ● a LIBO Rate floor of 2.3125% was added; and ● the fee due upon payment, prepayment, or repayment of the principal amount of the Loans under the Credit Facility, whether on the maturity date or otherwise, was increased to 2% from 1% of the aggregate principal amount of such payment, prepayment, or repayment. The Company issued warrants to purchase an aggregate of 1.2 million shares of Company common stock to the Investors with an exercise price of $0.01 per share and an expiration date of August 1, 2028 (collectively, the “2018 Warrants”). The issuance of the 2018 Warrants occurred on September 17, 2018 and was a condition to the effectiveness of the 25 th Warrants Second Amended and Restated Credit Agreement On March 29, 2019, the Company and the Investors entered into a Second Amended and Restated Credit Agreement (the “Second Amended and Restated Credit Agreement”), which amended and restated the Prior Credit Agreement. Under the Second Amended and Restated Credit Agreement: ● We may continue to make requests for term loans in amounts equal to the remaining commitment for additional delayed draw loans, which was approximately $2.2 million as of the date of the Second Amended and Restated Credit Agreement, and may request additional term loans with the Investors in an aggregate amount of up to $10.0 million, with the amount of each loan draw to be subject to our production of a thirteen-week cash flow forecast that is approved by the Investors and which shows a projected cash balance for the following two-week period of less than $1.5 million, as well as the satisfaction (or waiver in writing by each Investor) of conditions precedent, including closing certificate, delivery of budget, and other satisfactory documents; ● no interest will accrue on the Loans under the Second Amended and Restated Credit Agreement from and after January 1, 2019 until March 31, 2020; ● beginning April 1, 2020 through the maturity date of the Second Amended and Restated Credit Agreement, interest payable in cash will accrue on the Loans under the Credit Agreement at a rate per annum equal to the sum of (a) 10.00% plus (b) the higher of (x) the LIBO Rate (as such term is defined in the Second Amended and Restated Credit Agreement) and (y) 2.3125%; ● the maturity date of the Loans is March 31, 2021; ● the Consolidated Senior Leverage Ratio and Consolidated EBITDA (as such terms were defined in the Prior Credit Agreement) financial covenants were deleted, and a new Revenue Base (as such term is defined in the Second Amended and Restated Credit Agreement) financial covenant was added; and ● the key person event default provision was revised to refer specifically to certain recently-hired executive officers of the Company. Long-term debt, less issuance costs consists of long-term debt due to the lenders under our Second Amended and Restated Credit Agreement as of June 30, 2019 and under our Prior Credit Agreement as of December 31, 2018. The execution of the Second Amended and Restated Credit Agreement during the first quarter of 2019 and the changes to our credit facility reflected therein, including the interest rate relief and extended maturity, along with the additional availability, were determined to be and accounted for as a debt extinguishment under GAAP, resulting in the write-off of the original loan and associated issuance costs. The present value of the new loan was determined to be $72.7 million as of March 31, 2019 with the Company recording an increase to additional paid-in capital of $7.3 million. Because of the related party affiliation between the Company and our credit facility lenders, this debt extinguishment resulted in an increase in additional paid-in capital rather than flowing through our condensed consolidated statements of operations as a gain on extinguishment. As of June 30, 2019, our long-term debt, less issuance costs was $73.8 million. While our long-term debt, less issuance costs balance was $73.8 million as of June 30, 2019 under GAAP, the Company owes a principal balance of $55.8 million plus accrued PIK interest of $29.0 million as of June 30, 2019. Assuming no debt payments are made, our long-term debt, less issuance costs line item will continue to increase until the loan’s March 31, 2021 maturity date. Due to the terms within the Second Amended and Restated Credit Agreement, the Company performed an assessment of the changes to the terms of the Prior Credit Agreement in accordance with ASC 470. Given there were cumulative changes to the Prior Credit Agreement within one year of March 29, 2019, the debt terms that existed as of March 29, 2018 were used in the evaluation of the present value of cash flows for the old and new debt instruments which resulted in the extinguishment of the Prior Credit Agreement and recognition of the Second Amended and Restated Credit Agreement. A new effective interest rate of 13.19% for the Second Amended and Restated Credit Agreement was calculated based on the carrying amount of the debt and the present value of the revised future cash flows. This rate is effective through the remaining life of the loan. On April 1, 2019, the Company issued warrants to purchase an aggregate of 1.2 million shares of Company common stock to the Investors, with an exercise price of $0.01 per share and an expiration date of April 1, 2029 (collectively, the “2019 Warrants”). The issuance of the 2019 Warrants occurred on April 1, 2019 and was a condition to the effectiveness of the Second Amended and Restated Credit Agreement. Long-term debt consists of the following (in thousands): June 30, 2019 December 31, 2018 Amounts due under Second Amended and Restated Credit Agreement $ 72,657 $ — Amounts due under Prior Credit Agreement — 55,787 PIK interest payable related to Credit Agreements 1,149 27,178 Plus: 2% exit fee on Prior Credit Agreement 133 254 Gross long-term debt 73,939 83,219 Less: discount on Credit Agreements — (5,114 ) Less: total debt issuance costs on Credit Agreements (108 ) (166 ) Long-term debt, less issuance costs $ 73,831 $ 77,939 All gross long-term debt, comprising of a principal balance of $55.8 million plus accrued PIK interest of $29.0 million as of June 30, 2019, will mature March 31, 2021 and become payable at that time. The following is a summary of maturities due on the long-term debt as of June 30, 2019 (in thousands): Remainder of 2019 $ — 2020 — 2021 73,939 2022 — 2023 — Thereafter — Total $ 73,939 |
Equity
Equity | 6 Months Ended |
Jun. 30, 2019 | |
Equity [Abstract] | |
Equity | ( 7) Equity Convertible Note Indenture During the first quarter of 2018, in connection with our Restructuring (defined above), all of the outstanding 6.00% convertible senior unsecured notes due 2021 were converted or exchanged into shares of our common stock, and the Indenture governing such notes was discharged. On January 17, 2018, the Investors converted a $1.6 million aggregate principal amount of 6.00% convertible senior unsecured promissory notes due in 2021, which were issued effective January 17, 2017, plus accrued and unpaid interest, into 189,645 shares of our common stock. On February 14, 2018, an additional $70.3 million aggregate principal amount of notes, plus accrued and unpaid interest, were exchanged for 10,401,309 newly-issued shares of our common stock. Private Placement SPA On February 14, 2018, we sold to the Investors, pursuant to the Private Placement SPA, 945,819 shares of our common stock at a price of $7.20 per share for aggregate proceeds of $6.8 million. Registration Rights Agreement On May 15, 2018, we filed a shelf resale registration statement with the SEC pursuant to our obligations under the Registration Rights Agreement. This registration statement was declared effective by the SEC on June 4, 2018. Rights Offering On May 18, 2018, we distributed to holders of our common stock, at no charge, non-transferable subscription rights to purchase up to an aggregate of 1,137,515 shares of our common stock (the “Rights Offering”). In the Rights Offering, holders received 0.0869816 subscription rights for each share of common stock held on the record date, April 27, 2018. The units were priced at $7.20 per unit. The Rights Offering expired on June 18, 2018, at which time the rights were no longer exercisable. We issued 129 shares of our common stock in the Rights Offering, resulting in $0.9 thousand in gross proceeds to us. |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Jun. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | (8) Stock-Based Compensation Xtant Medical Holdings, Inc. 2018 Equity Incentive Plan On August 1, 2018, our stockholders approved the Xtant Medical Holdings, Inc. 2018 Equity Incentive Plan (the “2018 Plan”) at the 2018 annual meeting of stockholders of Xtant. The 2018 Plan became effective immediately upon approval by our stockholders and will expire on July 31, 2028, unless terminated earlier. The 2018 Plan replaced the Amended and Restated Xtant Medical Equity Incentive Plan (the “Prior Plan”) with respect to future grants of equity awards. The Prior Plan will continue to govern equity awards granted under the Prior Plan. The 2018 Plan permits the Board, or a committee thereof, to grant to eligible employees, non-employee directors, and consultants of the Company non-statutory and incentive stock options, stock appreciation rights, restricted stock awards, restricted stock units, deferred stock units, performance awards, non-employee director awards, and other stock-based awards. The Board may select 2018 Plan participants and determine the nature and amount of awards to be granted. Subject to adjustment as provided in the 2018 Plan, the number of shares of our common stock available for issuance under the 2018 Plan is 1,307,747 shares. Under the 2018 Plan, shares of our common stock related to awards granted under the plan that terminate by expiration, forfeiture, cancellation, or otherwise without the issuance of the shares will be available again for grant under the plan. The Board has granted various awards under the 2018 Plan to certain directors, officers and employees. As of June 30, 2019, stock options to purchase an aggregate of 130,770 shares of our common stock, a restricted stock award for 13,021 shares of common stock, and restricted stock units covering 40,000 shares were outstanding under the 2018 Plan. During the six months ended June 30, 2019, options to purchase 420,000 shares of common stock granted under the 2018 Plan were forfeited and cancelled as a result of the termination of employment of optionees. As of June 30, 2019, of the 1,307,747 shares of common stock available for issuance under the 2018 Plan, 1,110,935 shares remained available for future issuance. Shares of common stock issued under the 2018 Plan may be newly issued shares or reacquired shares. The Board also granted various awards under the Prior Plan. As of June 30, 2019, stock options to purchase an aggregate of 18,135 shares of our common stock and restricted stock awards for 23,438 shares of our common stock were outstanding under the Plan. During the six months ended June 30, 2019, options to purchase 3,053 shares of our common stock granted under the Plan were forfeited and cancelled as a result of the termination of employment of optionees. From time to time, we have granted options to purchase shares of our common stock outside of any stockholder-approved plan to new hires (collectively the “Non-Plan Grants”). As of June 30, 2019, no Non-Plan Grants were outstanding. During the six months ended June 30, 2019, Non-Plan Grants to purchase 25,000 shares of common stock were forfeited and cancelled as a result of the termination of employment of the optionee. Stock options granted under the 2018 Plan may be either incentive stock options to employees, as defined in Section 422A of the Internal Revenue Code of 1986, or non-qualified stock options. The exercise price of all stock options granted under the 2018 Plan must be at least equal to the fair market value of the shares of common stock on the date of the grant. The 2018 Plan is administered by the Board. Stock options granted under the 2018 Plan are generally not transferable, vest in installments over the requisite service period, and are exercisable during the stated contractual term of the option only by the optionee. Stock-based compensation expense recognized in the consolidated statements of operations for the six months ended June 30, 2019 and 2018 is based on awards expected to vest and reflects an estimate of awards that will be forfeited. ASU No. 2018-07, Stock Compensation (Topic 718) Stock option activity, including options granted under the 2018 Plan, the Prior Plan, and the Non-Plan Grants, was as follows: 2019 2018 Shares Weighted Average Exercise Price Per Share Weighted Average Fair Value at Grant Date Per Share Shares Weighted Average Exercise Price Per Share Weighted Average Fair Value at Grant Date Per Share Outstanding at January 1 496,958 $ 9.90 $ 6.62 67,465 $ 71.03 $ 36.85 Granted 100,000 $ 2.24 $ 1.95 — $ — $ — Cancelled or expired (448,053 ) $ 4.64 $ 3.69 (22,971 ) $ 96.44 $ 46.94 Outstanding at June 30 148,905 $ 9.12 $ 6.53 44,494 $ 53.14 $ 27.36 Exercisable at June 30 18,135 $ 52.04 $ 33.67 44,494 $ 53.14 $ 27.36 The estimated fair value of stock options granted is calculated using the Black-Scholes-Merton method applied to individual grants. Key assumptions used to estimate the fair value of stock awards are as follows: Six Months Ended June 30, 2019 2018 Risk free interest rate 2.7 % — Dividend yield 0 % — Expected term 10 years — Expected volatility 91 % — Expected forfeiture rate 30 % — The aggregate intrinsic value of options outstanding as of June 30, 2019 was $43 thousand. The closing price of our common stock at June 30, 2019 was $3.00, which was less than the exercise prices of all options issued under the Prior Plan or the 2018 Plan, other than an option to purchase 100,000 shares at an exercise price of $2.24. During the six months ended June 30, 2018, all options were fully vested and expensed due to the change in control as a result of the Corporate Restructuring, noted above. Total stock-based compensation recognized for employees and directors was $0.2 million and $0.4 million for the six months ended June 30, 2019 and 2018, respectively, and was recognized as Non-cash compensation expense. |
Warrants
Warrants | 6 Months Ended |
Jun. 30, 2019 | |
Warrants and Rights Note Disclosure [Abstract] | |
Warrants | (9) Warrants 2019 Warrants On April 1, 2019, the Company issued warrants to purchase an aggregate of 1.2 million shares of Company common stock to the Investors with an exercise price of $0.01 per share and an expiration date of April 1, 2029. As a result of the issuance of the warrant to purchase 1.2 million shares of common stock on April 1, 2019, the total outstanding common stock warrants as of April 1, 2019 was 2,910,609. The issuance of the 2019 Warrants was a condition to the effectiveness of the Second Amended and Restated Credit Agreement. The fair value of the 2019 Warrants upon issuance was determined to be $9 thousand. The significant decrease in value of the 2019 Warrants compared to the 2018 Warrants was attributable to the updated forecasts and assumptions used by the Company during the annual planning process for 2019 that resulted in our decision to conclude that a goodwill and intangible asset impairment charge was appropriate during the fourth quarter of 2018. See Note 4, “ Goodwill and Intangible Assets Common Stock Warrants Weighted Average Exercise Price Outstanding at January 1, 2019 1,710,609 $ 7.33 Issued 1,200,000 0.01 Expired — — Outstanding at June 30, 2019 2,910,609 $ 4.31 The estimated fair value was derived using a valuation model with the following weighted-average assumptions: Six Months Ended June 30, 2019 2018 Value of underlying common stock (per share) $ 3.00 $ 5.55 Risk free interest rate 1.8 % 2.62 % Expected term in years 3.2 4.1 Volatility 87 % 62 % Dividend yield 0 % 0 % The following table summarizes our activities related to warrants accounted for as a derivative liability for the six months ended June 30, 2019 and 2018: 2019 2018 Balance at January 1, 87,509 93,759 Derivative warrants issued — — Derivative warrants exercised — — Derivative warrants expired — (6,250 ) Balance at June 30, 87,509 87,509 We utilize a lattice valuation model to determine the fair market value of the warrants accounted for as liabilities. The lattice valuation model accommodates the probability of exercise price adjustment features, as outlined in the warrant agreements. We recorded an unrealized loss of $11 thousand resulting from the change in the fair value of the warrant derivative liability for the six months ended June 30, 2019. Under the terms of some of our warrant agreements, at any time while the warrant is outstanding, the exercise price per share can be reduced to the price per share of future subsequent equity sales of our common stock or a common stock equivalent that is lower than the exercise price per share as stated in the warrant agreement. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | (10) Commitments and Contingencies In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) Operating Leases We currently lease five office facilities, having terminated the Miamisburg, Ohio, lease on February 28, 2019. These leases are under non-cancelable operating lease agreements with expiration dates between 2019 and 2025. We have the option to extend certain leases to five or ten-year term(s), and we have the right of first refusal on any sale. The Company records lease liabilities within current liabilities or long-term liabilities based upon the length of time associated with the lease payments. The Company records its long-term operating leases as right-of-use assets. Upon initial adoption, using the modified retrospective transition approach, no leases with terms less than 12-months have been capitalized to the balance sheet consistent with ASC 842. Instead, these leases are recognized in the condensed consolidated statement of operations on a straight-line expense throughout the lives of the leases. All leases of the Company do not contain common area maintenance or security agreements. In connection with certain operating leases, the Company has security deposits recorded and maintained as a prepaid asset totaling $44 thousand as of June 30, 2019. We have made certain assumptions and judgments when applying ASC 842, the most significant of which is that we elected the package of practical expedients available for transition, which allow us to not reassess whether expired or existing contracts contain leases under the new definition of a lease, lease classification for expired or existing leases, and whether previously capitalized initial direct costs would qualify for capitalization under ASC 842. Additionally, we did not elect to use hindsight when considering judgments and estimates such as assessments of lessee options to extend or terminate a lease or purchase the underlying asset. Present Value of Long-term Leases (in thousands): June 30, 2019 Right-of-use assets, net $ 2,296 Current portion of lease liability 511 Lease liability, less current portion 1,796 Total lease liability $ 2,307 As of June 30, 2019, the weighted-average remaining lease term was 5.25 years. The Company’s lease agreements do not provide a readily determinable implicit rate nor is it available to the Company from its lessors. Instead, as of June 30, 2019, the Company estimates the weighted-average discount rate for its operating leases to be 5.2% to present value based on the incremental borrowing rate. Future minimum payments for the next five years and thereafter as of June 30, 2019 under these long-term operating leases are as follows (in thousands): Remainder of 2019 $ 282 2020 511 2021 516 2022 532 2023 473 Thereafter 404 Total future minimum lease payments 2,718 Less amount representing interest (411 ) Present value of obligations under operating leases 2,307 Less current portion (511 ) Long-term operating lease obligations $ 1,796 Rent expense was $0.3 million and $0.6 million for each of the six months ended June 30, 2019 and 2018, respectively. We have no contingent rent agreements. Financing Leases Future minimum payments for the next five years and thereafter as of June 30, 2019 under financing leases for equipment are as follows (in thousands): Remainder of 2019 $ 173 2020 218 2021 — 2022 — 2023 — Thereafter — Total future minimum lease payments 391 Less amount representing interest (38 ) Present value of obligations under financing leases 353 Less current portion (337 ) Long-term financing lease obligations $ 16 Litigation On December 13, 2018, a complaint was filed by RSB Spine, LLC, against Xtant Medical Holdings, Inc., which claims that some of our products, including the Irix-ATM Lumbar Integrated Fusion System and the Irix-CTM Cervical Integrated Fusion System, infringe certain of RSB Spine’s patents. The complaint seeks an adjudication of infringement, an injunction against future infringement, unspecified damages for infringement, a finding that such infringement is willful, and treble damages for such willful infringement. This action was brought in the United States District Court for the District of Delaware. We filed an answer and affirmative defenses to the complaint on March 29, 2019, denying the allegations of infringement and seeking dismissal of RSB Spine’s claims and requested relief. The Court entered a scheduling order on May 9, 2019, scheduling trial for no sooner than June 21, 2021. We intend to vigorously defend the claims in this action. There can be no assurance that the resolution of this matter will not have a material adverse effect on our business, financial condition, or results of operations. On August 10, 2017, a civil suit complaint was filed against Xtant in the United States District Court, District of Nevada, by Axis Spine NV, LLC (“Axis”), Case No. 2:17-CV-02147-APG-VCF. The complaint alleges breach of contract, breach of the implied covenant of good faith and fair dealing, and tortious interference with prospective economic advantage with respect to an alleged medical device distribution relationship between the parties. Specifically, Axis alleges that Xtant owes payments to Axis for its medical device distributions. Axis seeks relief in the form of damages in an amount in excess of $1.0 million. On March 6, 2019, the Court granted Xtant’s motion for summary judgment on Axis’s claims for breach of contract and breach of the covenant of good faith and fair dealing but denied Xtant’s motion for summary judgment on Axis’s unjust enrichment claim. In June 2019, the parties entered into an agreement to settle this dispute. This agreement resulted in a settlement payment by Xtant in an amount that is not material to our financial position or result of operations. In October 2016, Phoenix Surgical, Inc., a former distributor, sued Xtant for its alleged participation in a scheme orchestrated by a former Phoenix Surgical sales representative to divert sales away from Phoenix Surgical to another entity. On April 26, 2019, the parties entered into a confidential settlement agreement which resolved the dispute and resulted in a settlement payment by Xtant in an undisclosed amount that is not material to our financial position and did not have a material effect on our results of operations. In addition, we are subject to potential liabilities under government regulations and various claims and legal actions that are pending or may be asserted from time to time. These matters arise in the ordinary course and conduct of our business and may include, for example, commercial, product liability, intellectual property, and employment matters. We intend to continue to defend the Company vigorously in such matters and when warranted, take legal action against others. Furthermore, we regularly assess contingencies to determine the degree of probability and range of possible loss for potential accrual in our financial statements. An estimated loss contingency is accrued in our financial statements if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Based on our assessment, we have adequately accrued an amount for contingent liabilities currently in existence. We do not accrue amounts for liabilities that it does not believe are probable or that it considers immaterial to its overall financial position. Litigation is inherently unpredictable, and unfavorable resolutions could occur. As a result, assessing contingencies is highly subjective and requires judgment about future events. The amount of ultimate loss may exceed the Company’s current accruals, and it is possible that its cash flows or results of operations could be materially affected in any particular period by the unfavorable resolution of one or more of these contingencies. Indemnifications Our indemnification arrangements generally include limited warranties and certain provisions for indemnifying customers against liabilities if our products or services infringe a third-party’s intellectual property rights. To date, we have not incurred any material costs as a result of such warranties or indemnification provisions and have not accrued any liabilities related to such obligations in the accompanying condensed consolidated financial statements. We have also agreed to indemnify our directors and executive officers for costs associated with any fees, expenses, judgments, fines, and settlement amounts incurred by any of these persons in any action or proceeding to which any of those persons is, or is threatened to be, made a party by reason of the person’s service as a director or officer, including any action by us, arising out of that person’s services as our director or officer or that person’s services provided to any other company or enterprise at our request. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | (11) Income Taxes In evaluating the realizability of the net deferred tax assets, we take into account a number of factors, primarily relating to the ability to generate taxable income. Where it is determined that it is likely that we will be unable to realize deferred tax assets, a valuation allowance is established against the portion of the deferred tax asset. Because it cannot be accurately determined when or if we will become profitable, a valuation allowance was provided against the entire deferred income tax asset balance. The Company did not recognize any interest or penalties related to income taxes for the six months ended June 30, 2019 and 2018. |
Supplemental Disclosure of Cash
Supplemental Disclosure of Cash Flow Information | 6 Months Ended |
Jun. 30, 2019 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Disclosure of Cash Flow Information | (12) Supplemental Disclosure of Cash Flow Information Supplemental cash flow information is as follows (in thousands): Six Months Ended June 30, 2019 2018 Supplemental disclosure of cash flow information Cash paid during the period for: Interest $ 47 $ 170 Non-cash activities: Issuance of capital leases $ — $ 84 Lease liability from right-of-use assets $ 2,296 $ — Interest converted into common stock $ — $ 556 Conversion of convertible debt to equity $ — $ 71,865 Convertible PIK interest $ — $ 4,764 Conversion of interest related to the Credit Facility to long-term debt $ — $ 7,977 Write-off of convertible debt issuance cost $ — $ 1,012 Transfer of inventory to property and equipment $ — $ 439 Extinguishment of Prior Credit Agreement (including debt issuance costs) $ 79,624 $ — Write-off of Prior Credit Agreement debt issuance costs and existing ROS fees $ 307 $ — Recognition of Second Amended and Restated Credit Agreement $ 72,657 $ — Recognition of 2019 Warrants $ 9 $ — |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Jun. 30, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | (13) Related Party Transactions The Investors, owning approximately 70% of the Company’s outstanding common stock, are the sole holders of our outstanding long-term debt. In addition, as described in more detail under Note 1, “ Business Description and Summary of Significant Accounting Policies On April 5, 2019, the Company entered into a Sublease Agreement wherein the Company leases from Cardialen, Inc., a portion of Cardialen’s office space commencing April 2019 on a month-to-month basis until January 2024, unless terminated earlier upon notice of 60 days, for a monthly rental fee of approximately $2,100 for 2019. Because Jeffrey Peters is both a member of our Board and the Chief Executive Officer, President, and a Director of Cardialen, this transaction qualifies as a related party transaction. All related party transactions are reviewed and approved by the Audit Committee or the disinterested members of the full Board. |
Segment and Geographic Informat
Segment and Geographic Information | 6 Months Ended |
Jun. 30, 2019 | |
Segment Reporting [Abstract] | |
Segment and Geographic Information | (14) Segment and Geographic Information The Company’s management reviews financial results and manages the business on an aggregate basis. Therefore, financial results are reported in a single operating segment: the development, manufacture, and marketing of orthopedic medical products and devices. The Company attributes revenues to geographic areas based on the location of the customer. Approximately 96% and 95% of sales were in the United States for the six months ended June 30, 2019 and 2018, respectively. Total revenue by major geographic area is as follows (in thousands): Three Months Ended June 30, 2019 2018 United States $ 14,585 $ 17,319 Rest of world 686 1,422 Total revenue $ 15,271 $ 18,741 Six Months Ended June 30, 2019 2018 United States $ 30,702 $ 34,792 Rest of world 1,295 1,882 Total revenue $ 31,997 $ 36,674 |
Business Description, Basis o_2
Business Description, Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business Description and Basis of Presentation | Business Description and Basis of Presentation The accompanying condensed consolidated financial statements include the accounts of Xtant Medical Holdings, Inc. (“Xtant”), a Delaware corporation, and its wholly owned subsidiaries, Xtant Medical, Inc. (“Xtant Medical”), a Delaware corporation, Bacterin International, Inc. (“Bacterin”), a Nevada corporation, and X-spine Systems, Inc. (“X-spine”), an Ohio corporation (Xtant, Xtant Medical, Bacterin, and X-spine are jointly referred to herein as the “Company” or sometimes “we”, “our,” or “us”). All intercompany balances and transactions have been eliminated in consolidation. Xtant is a global medical technology company focused on the design, development, and commercialization of a comprehensive portfolio of orthobiologics and spinal implant systems to facilitate spinal fusion in complex spine, deformity, and degenerative procedures. The accompanying condensed consolidated financial statements of Xtant for the three and six months ended June 30, 2019 and 2018 are unaudited and are prepared in accordance with accounting principles generally accepted in the United States of America. They do not include all disclosures required by generally accepted accounting principles for annual consolidated financial statements, but in the opinion of management, include all adjustments, consisting only of normal recurring items, necessary for a fair presentation. Certain prior year amounts have been reclassified to conform with current year presentation. Interim results are not necessarily indicative of results that may be achieved in the future for the full year ending December 31, 2019. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto, which are included in Xtant’s Annual Report on Form 10-K for the year ended December 31, 2018. The accounting policies set forth in those annual consolidated financial statements are the same as the accounting policies utilized in the preparation of these condensed consolidated financial statements, except as modified for appropriate interim consolidated financial statement presentation. As described in more detail below, effective as of February 13, 2018, the Company effected a 1-for-12 reverse split of its common stock (the “Reverse Stock Split”). The Reverse Stock Split is reflected in the share amounts in all periods presented in this report. During the preparation of this Quarterly Report on Form 10-Q, the Company identified an immaterial misstatement on the condensed consolidated balance sheet as of June 30, 2018. The Accumulated deficit line item was overstated by $320 thousand and should have been reported as $155.2 million instead of $155.5 million. The Total stockholders’ equity (deficit) and Total liabilities and stockholders’ equity (deficit) line items in the condensed consolidated balance sheet as of June 30, 2018 were correct. In addition, the Accumulated deficit line item in subsequent Quarterly Reports on Form 10-Q and in the Annual Report on Form 10-K for the year ended December 31, 2018 were correct. Management evaluated the effect of this misstatement on the prior period and concluded that the prior period was not materially misstated. Accordingly, the misstatement has been corrected in the second quarter of 2019 and in this Quarterly Report on Form 10-Q. Specifically, the June 30, 2018 balance under the Retained deficit column in the condensed consolidated statements of equity for the three and six months ended June 30, 2018 reflects a retained deficit of $155.2 million instead of $155.5 million. |
Corporate Restructuring | Corporate Restructuring Restructuring Agreement On January 11, 2018, we entered into a Restructuring and Exchange Agreement (the “Restructuring Agreement”) with ROS Acquisition Offshore LP, OrbiMed Royalty Opportunities II, LP (collectively referred to herein as the “Investors”), Bruce Fund, Inc., Park West Partners International, Limited (“PWPI”), Park West Investors Master Fund, Limited (“PWIMF”), and Telemetry Securities, L.L.C., collectively referred to herein as the “Holders.” Pursuant to the Restructuring Agreement, and following the execution of the Sixth Amendment to the 2017 Notes, described in the “Debt” and “Equity” sections below, on January 17, 2018, the Investors converted 6.00% convertible senior unsecured notes due 2021, plus accrued and unpaid interest, at the $9.11 per share conversion rate originally provided thereunder (the “2017 Notes”), into 189,645 shares of our common stock. On February 14, 2018, after giving effect to the Reverse Stock Split (described below), the $70.3 million aggregate principal amount of our then outstanding 6.00% convertible senior unsecured notes due 2021 held by the Holders (the “Remaining Notes”), plus accrued and unpaid interest, were exchanged for newly-issued shares of our common stock at an exchange rate of 138.8889 shares per $1,000 principal amount of the Remaining Notes, for an exchange price of $7.20 per share (the “Notes Exchange”). This resulted in the issuance of 10,401,309 shares of our common stock to the Holders and the Investors acquiring an approximately 70% controlling interest in our outstanding shares of common stock. Upon the completion of the Notes Exchange, all outstanding obligations under our convertible senior secured notes were satisfied in full, and the Indentures governing such notes were discharged. Pursuant to the terms of the Restructuring Agreement, we commenced a rights offering to allow our stockholders as of a record date of April 27, 2018 to purchase up to an aggregate of 1,137,515 shares of our common stock at a subscription price of $7.20 per share. The rights offering expired on June 18, 2018. We issued 129 shares of common stock in the rights offering and received $0.9 thousand gross proceeds. Amended and Restated Certificate of Incorporation On February 13, 2018, following a special meeting of our stockholders, we filed with the Secretary of State of the State of Delaware a Certificate of Amendment to our Charter (the “Certificate Amendment”). The Certificate Amendment amended and restated our Charter (the “Charter”) to, among other things: ● effect the Reverse Stock Split; ● after giving effect to the Reverse Stock Split, decrease the number of authorized shares of common stock available for issuance from 95,000,000 to 50,000,000 and increase the number of authorized shares of preferred stock available for issuance from 5,000,000 to 10,000,000; ● authorize the Board of Directors (“Board”) to increase or decrease the number of shares of any series of our capital stock, provided that such increase or decrease does not exceed the number of authorized shares or represent less than the number of shares then outstanding; ● authorize the Board to issue new series of preferred stock without approval of the holders of common stock or other series of preferred stock, with such powers, preferences, and rights as may be determined by the Board; ● authorize a majority of the Board to fix the number of our directors; ● indemnify the members of the Board to the fullest extent permitted by law; ● remove the classification of the Board to require all directors to be elected annually; ● provide that special meetings of our stockholders may only be called by the Board, the chairman of the Board, or our chief executive officer; ● provide that no stockholder will be permitted cumulative voting at any election of directors; ● elect not to be governed by Section 203 of the Delaware General Corporation Law (the “DGCL”); ● elect the Court of Chancery of the State of Delaware to be the exclusive forum for any derivative action or proceeding brought on our behalf, any action asserting a breach of a fiduciary duty owed by any of our directors, officers, or other employees, any action under the DGCL, our Charter, or bylaws, or any actions governed by the internal affairs doctrine; and ● require the vote of at least two-thirds of the voting power of the then outstanding shares of our capital stock to amend or repeal certain provisions of our Charter. The Reverse Stock Split became effective as of 5:00 p.m. Eastern Time on February 13, 2018, and our common stock began trading on a split-adjusted basis when the market opened on February 14, 2018. Upon the effectiveness of the Reverse Stock Split, every 12 shares of our issued and outstanding common stock automatically converted into one share of common stock, without any change in the par value per share. In addition, a proportionate adjustment was made to the per share exercise price and the number of shares issuable upon the exercise of all of our outstanding stock options and convertible securities to purchase shares of common stock and the number of shares underlying restricted stock awards and reserved for issuance pursuant to our equity incentive compensation plan. Any fraction of a share of common stock that would otherwise have resulted from the Reverse Stock Split was rounded down to the nearest whole share. All share and per share amounts have been retroactively restated to reflect the Reverse Stock Split. Private Placement SPA On February 14, 2018, we entered into a Securities Purchase Agreement (the “Private Placement SPA”) with the Investors pursuant to which the Investors purchased from us an aggregate of 945,819 shares of our common stock at a price of $7.20 per share for aggregate proceeds of $6.8 million. Investor Rights Agreement Effective February 14, 2018, we entered into an Investor Rights Agreement (the “Investor Rights Agreement”) with the Holders. Under the Investor Rights Agreement, the Investors are permitted to nominate a majority of our directors and designate the chairperson of the Board at subsequent annual meetings, as long as the Investors maintain an ownership threshold in the Company of at least 40% of the then outstanding common stock (the “Ownership Threshold”). If the Investors are unable to maintain the Ownership Threshold, the Investor Rights Agreement contemplates a reduction of nomination rights commensurate with their ownership interests. For so long as the Ownership Threshold is met, we must obtain the approval of the Investors to proceed with the following actions: (i) issue new securities; (ii) incur over $0.25 million of debt in a fiscal year; (iii) sell or transfer over $0.25 million of our assets or businesses or our subsidiaries in a fiscal year; (iv) acquire over $0.25 million of assets or properties in a fiscal year; (v) make capital expenditures over $0.125 million individually or $1.5 million in the aggregate during a fiscal year; (vi) approve our annual budget; (vii) hire or terminate our chief executive officer; (viii) appoint or remove the chairperson of the Board; and (ix) make loans to, make investments in, or purchase, or permit any subsidiary to purchase, any stock or other securities in another entity in excess of $0.25 million in a fiscal year. As long as the Ownership Threshold is met, we may not increase the size of the Board beyond seven directors without the approval of a majority of the directors nominated by the Investors. The Investor Rights Agreement grants the Holders the right to purchase from us a pro rata amount of any new securities that we may propose to issue and sell. The Investor Rights Agreement may be terminated (a) upon the mutual written agreement of all the parties, (b) upon written notice of the Company or an Investor, if such Investor’s ownership percentage of our then outstanding common stock is less than 10%, or (c) upon written notice by the Investors. PWPI and PWIMF’s right to purchase from us a pro rata amount of any new securities will also terminate at such time as their aggregate ownership percentage of our then outstanding common stock is less than 8.5%. Registration Rights Agreement Effective February 14, 2018, we entered into a Registration Rights Agreement (the “Registration Rights Agreement”) with the Holders. The Registration Rights Agreement requires us to, among other things, file with the U.S. Securities and Exchange Commission (“SEC”) a shelf registration statement within 90 days of the date of the Registration Rights Agreement covering the resale, from time to time, of our common stock issued. The registration statement became effective on June 4, 2018. Second Amended and Restated Bylaws On February 14, 2018, we amended and restated our current bylaws by adopting the Second Amended and Restated Bylaws of the Company (the “Amended Bylaws”). The Amended Bylaws amended our existing bylaws to, among other things: ● provide for annual and special meetings of stockholders to be held through remote communications; ● provide for the election of any directors not elected at an annual meeting of stockholders to be elected at a special meeting of stockholders; ● declassify the Board into one group of directors that will hold office until the subsequent annual meeting of stockholders and until the election and qualification of such directors’ respective successors; ● provide for the filling of a new directorship or director vacancy by the affirmative vote of the holders of a majority of the voting power of our shares of stock; ● allow for a majority of the Board present to adjourn a Board meeting if a quorum is not met; ● unless otherwise restricted in the Amended Bylaws or our Charter, provide the Board with the authority to fix the compensation of directors, including, without limitation, compensation for services as members of Board committees; ● allow us to enter into an agreement with a stockholder to restrict the transfer of shares held by such stockholder in any manner not prohibited by the DGCL; and ● allow the Board to declare dividends on our capital stock, subject to any provisions of our Charter and applicable law. |
Concentrations and Credit Risk | Concentrations and Credit Risk The Company’s accounts receivable are due from a variety of health care organizations and distributors throughout the world. No single customer accounted for more than 10% of revenue or accounts receivable for the comparable periods. The Company provides for uncollectible amounts when specific credit issues arise. Management believes that all significant credit risks have been identified at June 30, 2019. |
Use of Estimates | Use of Estimates The preparation of the consolidated financial statements requires management of the Company to make a number of estimates and assumptions relating to the reported amount of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the period. Significant estimates include the carrying amount of property and equipment, goodwill and intangible assets and liabilities, valuation allowances for trade receivables, inventory and deferred income tax assets and liabilities, valuation of the warrant derivative liability, current and long-term financing lease obligations and corresponding right-of-use asset, and estimates for the fair value of long-term debt, stock options, grants, and other equity awards upon which the Company determines stock-based compensation expense. Actual results could differ from those estimates. |
Long-Lived Assets | Long-Lived Assets Long-lived assets, including intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the estimated fair value of the assets. Management reviewed the assumptions of intangible assets as of June 30, 2019 and determined that no impairment of the carrying value of the long-lived assets existed during the second quarter of 2019. |
Goodwill | Goodwill Goodwill represents the excess of costs over fair value of assets of businesses acquired. Goodwill and intangible assets acquired in a purchase business combination and determined to have indefinite useful lives are not amortized. Instead, they are tested for impairment at least annually, and whenever events or circumstances indicate, the carrying amount of the asset may not be recoverable. The Company conducts its impairment test on an annual basis and will review the analysis assumptions on a quarterly basis. We test goodwill for impairment at the reporting unit level, which is an operating segment, or one level below an operating segment, referred to as a component. A component of an operating segment is a reporting unit if the component constitutes a business for which discrete financial information is available and segment management regularly reviews the operating results of that component. |
Revenue Recognition | Revenue Recognition The Company adopted the provisions of Accounting Standards Update (“ASU”) No. 2014-09, Topic 606, Revenue from Contracts with Customers Disaggregation of Revenue The Company operates in one reportable segment with our net revenue derived primarily from the sale of orthobiologics and spinal implant products across North America, Europe, Asia Pacific, and Latin America. Sales are reported net of returns. No rebates, group purchasing organization fees, or other customer allowances are present and so are not relevant to net revenue determination. The following table presents revenues from these product lines for the three and six months ended June 30, 2019 and 2018 (in thousands): Three Months Ended Percentage of Three Months Ended Percentage of June 30, 2019 Total Revenue June 30, 2018 Total Revenue Orthobiologics $ 11,020 72 % $ 12,713 68 % Spinal implant $ 4,177 27 % $ 5,940 32 % Other revenue $ 74 1 % $ 88 0 % Total revenue $ 15,271 100 % $ 18,741 100 % Six Months Ended Percentage of Six Months Ended Percentage of June 30, 2019 Total Revenue June 30, 2018 Total Revenue Orthobiologics $ 23,020 72 % $ 24,818 68 % Spinal implant $ 8,863 27 % $ 11,665 31 % Other revenue $ 114 1 % $ 191 1 % Total revenue $ 31,997 100 % $ 36,674 100 % Performance Obligations The Company’s contracts do not include a right of acceptance or a right to cancel. Therefore, our process for recognizing revenue does not require an evaluation of whether acceptance is received or a right to cancel has expired. Further, the Company does not incur upfront costs or exclusivity fees in conjunction with entering into a customer contract. The Company’s customer contracts do not provide for percentage of completion performance measures or contingent consideration. In the normal course of business, the Company accepts returns of products that have not been implanted. Product returns are not material to the Company’s consolidated statements of operations. The Company accounts for shipping and handling activities as a fulfillment cost rather than a separate performance obligation. The Company’s policy is to record revenue net of any applicable sales, use, or excise taxes. Payment terms are generally net 30 days from invoice date, and some customers are offered discounts for early pay. Contract Assets and Liabilities The Company does not have deferred or unearned revenue arrangements with its customers that would give rise to contract liabilities. The Company recognizes sales commissions as incurred because the amortization period is less than one year. Additionally, the Company does not recognize unbilled receivables or progress payments to be billed that would result in a contract asset. All pricing and agreements are completed based on the contracted individual unit price; no other methods of determining price are allowed within the Company’s sales agreements. Therefore, no contract assets or contract liabilities are recorded in our condensed consolidated balance sheets as of June 30, 2019 and 2018. |
Research and Development | Research and Development Research and development costs, which are principally related to internal costs for the development of new products, are expensed as incurred. |
Net Loss Per Share | Net Loss Per Share Basic net income (loss) per share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding. Shares issued during the period and shares reacquired during the period are weighted for the portion of the period that they were outstanding. Diluted net income (loss) per share is computed in a manner consistent with that of basic earnings per share while giving effect to all potentially dilutive shares of common stock outstanding during the period, which include the assumed exercise of stock options and warrants using the treasury stock method. Diluted net loss per share was the same as basic net loss per share for the six months ended June 30, 2019 and 2018, as shares issuable upon the exercise of stock options and warrants were anti-dilutive as a result of the net losses incurred for those periods. Dilutive earnings per share are not reported, as the effects of including 3,135,973 and 558,161 outstanding stock options, restricted stock units and warrants for the six months ended June 30, 2019 and 2018, respectively, are anti-dilutive. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying values of financial instruments, including trade accounts receivable, accounts payable, accrued liabilities, and long-term debt, approximate their fair values based on terms and related interest rates. The Company follows a framework for measuring fair value. The framework provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described as follows: Level 1: Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets. Level 2: Inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. Level 3: Inputs to the valuation methodology are unobservable and significant to the fair value measurement. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. During the six months ended June 30, 2019 and 2018, there were no reclassifications in financial assets or liabilities between Level 1, 2, or 3 categories. The following table sets forth by level, within the fair value hierarchy, our liabilities that are measured at fair value on a recurring basis. Warrant derivative liability (in thousands): As of June 30, 2019 As of December 31, 2018 Level 1 — — Level 2 — — Level 3 $ 21 $ 10 The valuation technique used to measure fair value of the warrant liability is based on a lattice valuation model and significant assumptions and inputs determined by us. See Note 9, “ Warrants Level 3 Changes The following is a reconciliation of the beginning and ending balances for liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the six months ended June 30, 2019: Warrant derivative liability (in thousands): Balance at January 1, 2019 $ 10 Loss recognized in earnings 11 Balance at June 30, 2019 $ 21 During the six months ended June 30, 2019, the Company did not change any of the valuation techniques used to measure its liabilities at fair value. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2016-13, Financial Instruments–Credit losses: Measurement of Credit Losses on Financial Instruments Financial Instruments–Credit Loss Financial Instruments–Credit Losses (Topic 326): Targeted Transition Relief In August 2018, the FASB issued ASU No. 2018-15, Intangibles–Goodwill and Other–Internal-Use Software (Subtopic 350-40) |
Business Description, Basis o_3
Business Description, Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of Revenues from Product Lines | The following table presents revenues from these product lines for the three and six months ended June 30, 2019 and 2018 (in thousands): Three Months Ended Percentage of Three Months Ended Percentage of June 30, 2019 Total Revenue June 30, 2018 Total Revenue Orthobiologics $ 11,020 72 % $ 12,713 68 % Spinal implant $ 4,177 27 % $ 5,940 32 % Other revenue $ 74 1 % $ 88 0 % Total revenue $ 15,271 100 % $ 18,741 100 % Six Months Ended Percentage of Six Months Ended Percentage of June 30, 2019 Total Revenue June 30, 2018 Total Revenue Orthobiologics $ 23,020 72 % $ 24,818 68 % Spinal implant $ 8,863 27 % $ 11,665 31 % Other revenue $ 114 1 % $ 191 1 % Total revenue $ 31,997 100 % $ 36,674 100 % |
Schedule of Assets and Liabilities Measured on Recurring Basis | The following table sets forth by level, within the fair value hierarchy, our liabilities that are measured at fair value on a recurring basis. Warrant derivative liability (in thousands): As of June 30, 2019 As of December 31, 2018 Level 1 — — Level 2 — — Level 3 $ 21 $ 10 |
Schedule of Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation | Warrant derivative liability (in thousands): Balance at January 1, 2019 $ 10 Loss recognized in earnings 11 Balance at June 30, 2019 $ 21 |
Inventories, Net (Tables)
Inventories, Net (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | Inventories consist of the following (in thousands): June 30, 2019 December 31, 2018 Raw materials $ 3,465 $ 3,519 Work in process 1,480 949 Finished goods 23,534 25,235 Gross inventories 28,479 29,703 Reserve for obsolescence (12,651 ) (12,402 ) Total inventories, net $ 15,828 $ 17,301 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment, Net | Property and equipment, net are as follows (in thousands): June 30, 2019 December 31, 2018 Equipment $ 4,082 $ 4,145 Computer equipment 455 481 Computer software 570 570 Furniture and fixtures 99 164 Leasehold improvements 3,955 3,941 Vehicles 10 10 Surgical instruments 10,794 10,772 Total cost 19,965 20,083 Less: accumulated depreciation (14,365 ) (12,909 ) Property and equipment, net $ 5,600 $ 7,174 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets | he following table sets forth information regarding intangible assets (in thousands): June 30, 2019 December 31, 2018 Patents $ 847 $ 847 Accumulated amortization (303 ) (274 ) Intangible assets, net $ 544 $ 573 |
Schedule of Estimated Amortization Expense for Intangible Assets | The following is a summary of estimated future amortization expense for intangible assets as of June 30, 2019 (in thousands): Remainder of 2019 $ 30 2020 58 2021 58 2022 58 2023 58 Thereafter 282 Total $ 544 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Liabilities | Accrued liabilities consist of the following (in thousands): June 30, 2019 December 31, 2018 Wages/commissions payable $ 3,808 $ 3,332 Other accrued liabilities 2,059 1,818 Accrued liabilities $ 5,867 $ 5,150 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt | Long-term debt consists of the following (in thousands): June 30, 2019 December 31, 2018 Amounts due under Second Amended and Restated Credit Agreement $ 72,657 $ — Amounts due under Prior Credit Agreement — 55,787 PIK interest payable related to Credit Agreements 1,149 27,178 Plus: 2% exit fee on Prior Credit Agreement 133 254 Gross long-term debt 73,939 83,219 Less: discount on Credit Agreements — (5,114 ) Less: total debt issuance costs on Credit Agreements (108 ) (166 ) Long-term debt, less issuance costs $ 73,831 $ 77,939 |
Schedule of Maturities Due on Debt | The following is a summary of maturities due on the long-term debt as of June 30, 2019 (in thousands): Remainder of 2019 $ — 2020 — 2021 73,939 2022 — 2023 — Thereafter — Total $ 73,939 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Share-based Compensation, Stock Options, Activity | Stock option activity, including options granted under the 2018 Plan, the Prior Plan, and the Non-Plan Grants, was as follows: 2019 2018 Shares Weighted Average Exercise Price Per Share Weighted Average Fair Value at Grant Date Per Share Shares Weighted Average Exercise Price Per Share Weighted Average Fair Value at Grant Date Per Share Outstanding at January 1 496,958 $ 9.90 $ 6.62 67,465 $ 71.03 $ 36.85 Granted 100,000 $ 2.24 $ 1.95 — $ — $ — Cancelled or expired (448,053 ) $ 4.64 $ 3.69 (22,971 ) $ 96.44 $ 46.94 Outstanding at June 30 148,905 $ 9.12 $ 6.53 44,494 $ 53.14 $ 27.36 Exercisable at June 30 18,135 $ 52.04 $ 33.67 44,494 $ 53.14 $ 27.36 |
Schedule of Assumptions of Stock Option Granted | Key assumptions used to estimate the fair value of stock awards are as follows: Six Months Ended June 30, 2019 2018 Risk free interest rate 2.7 % — Dividend yield 0 % — Expected term 10 years — Expected volatility 91 % — Expected forfeiture rate 30 % — |
Warrants (Tables)
Warrants (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Warrants and Rights Note Disclosure [Abstract] | |
Schedule of Warrant Activity | Common Stock Warrants Weighted Average Exercise Price Outstanding at January 1, 2019 1,710,609 $ 7.33 Issued 1,200,000 0.01 Expired — — Outstanding at June 30, 2019 2,910,609 $ 4.31 |
Schedule of Warrant Valuation Assumptions | The estimated fair value was derived using a valuation model with the following weighted-average assumptions: Six Months Ended June 30, 2019 2018 Value of underlying common stock (per share) $ 3.00 $ 5.55 Risk free interest rate 1.8 % 2.62 % Expected term in years 3.2 4.1 Volatility 87 % 62 % Dividend yield 0 % 0 % |
Schedule of Warrants Activities Used in Derivative Liability | The following table summarizes our activities related to warrants accounted for as a derivative liability for the six months ended June 30, 2019 and 2018: 2019 2018 Balance at January 1, 87,509 93,759 Derivative warrants issued — — Derivative warrants exercised — — Derivative warrants expired — (6,250 ) Balance at June 30, 87,509 87,509 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Right-of-use Assets and Lease Liability | Present Value of Long-term Leases (in thousands): June 30, 2019 Right-of-use assets, net $ 2,296 Current portion of lease liability 511 Lease liability, less current portion 1,796 Total lease liability $ 2,307 |
Schedule of Future Minimum Rental Payments for Operating Leases | Future minimum payments for the next five years and thereafter as of June 30, 2019 under these long-term operating leases are as follows (in thousands): Remainder of 2019 $ 282 2020 511 2021 516 2022 532 2023 473 Thereafter 404 Total future minimum lease payments 2,718 Less amount representing interest (411 ) Present value of obligations under operating leases 2,307 Less current portion (511 ) Long-term operating lease obligations $ 1,796 |
Schedule of Future Minimum Lease Payments for Financing Leases | Future minimum payments for the next five years and thereafter as of June 30, 2019 under financing leases for equipment are as follows (in thousands): Remainder of 2019 $ 173 2020 218 2021 — 2022 — 2023 — Thereafter — Total future minimum lease payments 391 Less amount representing interest (38 ) Present value of obligations under financing leases 353 Less current portion (337 ) Long-term financing lease obligations $ 16 |
Supplemental Disclosure of Ca_2
Supplemental Disclosure of Cash Flow Information (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of Supplemental Cash Flow Information | Supplemental cash flow information is as follows (in thousands): Six Months Ended June 30, 2019 2018 Supplemental disclosure of cash flow information Cash paid during the period for: Interest $ 47 $ 170 Non-cash activities: Issuance of capital leases $ — $ 84 Lease liability from right-of-use assets $ 2,296 $ — Interest converted into common stock $ — $ 556 Conversion of convertible debt to equity $ — $ 71,865 Convertible PIK interest $ — $ 4,764 Conversion of interest related to the Credit Facility to long-term debt $ — $ 7,977 Write-off of convertible debt issuance cost $ — $ 1,012 Transfer of inventory to property and equipment $ — $ 439 Extinguishment of Prior Credit Agreement (including debt issuance costs) $ 79,624 $ — Write-off of Prior Credit Agreement debt issuance costs and existing ROS fees $ 307 $ — Recognition of Second Amended and Restated Credit Agreement $ 72,657 $ — Recognition of 2019 Warrants $ 9 $ — |
Segment and Geographic Inform_2
Segment and Geographic Information (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Segment Reporting [Abstract] | |
Schedule of Revenues by Geographic Region | Total revenue by major geographic area is as follows (in thousands): Three Months Ended June 30, 2019 2018 United States $ 14,585 $ 17,319 Rest of world 686 1,422 Total revenue $ 15,271 $ 18,741 Six Months Ended June 30, 2019 2018 United States $ 30,702 $ 34,792 Rest of world 1,295 1,882 Total revenue $ 31,997 $ 36,674 |
Business Description, Basis o_4
Business Description, Basis of Presentation and Summary of Significant Accounting Policies (Details Narrative) | May 18, 2018USD ($)$ / sharesshares | Apr. 27, 2018USD ($)$ / sharesshares | Feb. 14, 2018USD ($)$ / sharesshares | Feb. 14, 2018USD ($)$ / sharesshares | Feb. 13, 2018shares | Jan. 17, 2018USD ($)$ / sharesshares | Jun. 30, 2019USD ($)shares | Jun. 30, 2018USD ($)shares | Jun. 30, 2019USD ($)Segmentshares | Jun. 30, 2018USD ($)shares | Dec. 31, 2018USD ($)shares |
Reverse stock split, description | Upon the effectiveness of the Reverse Stock Split, every 12 shares of our issued and outstanding common stock automatically converted into one share of common stock, without any change in the par value per share. | 1-for-12 reverse split | |||||||||
Accumulated deficit | $ | $ (219,783,000) | $ 155,200,000 | $ (219,783,000) | $ 155,200,000 | $ (215,045,000) | ||||||
Retained deficit in equity | $ | $ 155,200,000 | 155,200,000 | |||||||||
Debt conversion, converted instrument, amount | $ | $ 71,865,000 | ||||||||||
Stock issued during period, shares, new issues | 129 | ||||||||||
Shares issued, price per share | $ / shares | $ 0.0869816 | ||||||||||
Stock issued during period, value, new issues | $ | $ 900 | $ 1,000 | $ 79,199,000 | ||||||||
Common stock, shares authorized | 50,000,000 | 50,000,000 | 50,000,000 | ||||||||
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | 10,000,000 | ||||||||
Description of royalty opportunities | (i) issue new securities; (ii) incur over $0.25 million of debt in a fiscal year; (iii) sell or transfer over $0.25 million of our assets or businesses or our subsidiaries in a fiscal year; (iv) acquire over $0.25 million of assets or properties in a fiscal year; (v) make capital expenditures over $0.125 million individually, or $1.5 million in the aggregate during a fiscal year; (vi) approve our annual budget; (vii) hire or terminate our chief executive officer; (viii) appoint or remove the chairperson of the Board; and (ix) make, loans to, make investments in, or purchase, or permit any subsidiary to purchase, any stock or other securities in another entity in excess of $0.25 million in a fiscal year. | ||||||||||
Ownership interest percentage description | (a) upon the mutual written agreement of all the parties, (b) upon written notice of the Company or an Investor, if such Investor's ownership percentage of our then outstanding common stock is less than 10%, or (c) upon written notice by the Investors. PWPI and PWIMF's right to purchase from us a pro rata amount of any new securities will also terminate at such time as their aggregate ownership percentage of our then outstanding common stock is less than 8.5%. | ||||||||||
Number of reportable segments | Segment | 1 | ||||||||||
Concentration risk percentage | 10.00% | ||||||||||
Impairment of long-lived assets | $ | |||||||||||
Contract assets | $ | |||||||||||
Contract liabilities | $ | |||||||||||
Antidilutive securities excluded from computation of earnings per share, amount | 3,135,973 | 558,161 | |||||||||
Securities Purchase Agreement [Member] | |||||||||||
Stock issued during period, shares, new issues | 945,819 | ||||||||||
Shares issued, price per share | $ / shares | $ 7.20 | $ 7.20 | |||||||||
Stock issued during period, value, new issues | $ | $ 6,800,000 | ||||||||||
Before Reverse Stock Split [Member] | |||||||||||
Common stock, shares authorized | 95,000,000 | ||||||||||
Preferred stock, shares authorized | 5,000,000 | ||||||||||
After Reverse Stock Split Member] | |||||||||||
Common stock, shares authorized | 50,000,000 | ||||||||||
Preferred stock, shares authorized | 10,000,000 | ||||||||||
Maximum [Member] | |||||||||||
Stock issued during period, shares, new issues | 1,137,515 | ||||||||||
Minimum [Member] | |||||||||||
Outstanding common stock in percentage | 40.00% | 40.00% | |||||||||
Restructuring Agreement [Member] | |||||||||||
Stock issued during period, shares, new issues | 129 | ||||||||||
Shares issued, price per share | $ / shares | $ 7.20 | ||||||||||
Rights offering expired | Jun. 18, 2018 | ||||||||||
Stock issued during period, value, new issues | $ | $ 900 | ||||||||||
Restructuring Agreement [Member] | Maximum [Member] | |||||||||||
Stock issued during period, shares, new issues | 1,137,515 | ||||||||||
2017 Notes [Member] | |||||||||||
Debt conversion, converted instrument, shares issued | 189,645 | ||||||||||
6.00% Convertible Senior Unsecured Notes [Member] | |||||||||||
Debt instrument due date description | Convertible senior unsecured notes due 2021 | All of the outstanding 6.00% convertible senior unsecured notes due 2021 | |||||||||
Debt instrument, conversion price per share | $ / shares | $ 7.20 | $ 7.20 | |||||||||
Debt conversion, converted instrument, shares issued | 10,401,309 | 10,401,309 | 189,645 | ||||||||
Debt conversion, converted instrument, amount | $ | $ 70,300,000 | $ 1,600,000 | |||||||||
Debt instrument, convertible, conversion ratio | 138.8889 | ||||||||||
Debt instrument, principal amount per share conversion | $ / shares | $ 1,000 | $ 1,000 | |||||||||
6.00% Convertible Senior Unsecured Notes [Member] | OrbiMed Royalty Opportunities II, LP [Member] | |||||||||||
Non-controlling interest, ownership percentage by parent | 70.00% | 70.00% | |||||||||
6.00% Convertible Senior Unsecured Notes [Member] | 2017 Notes [Member] | |||||||||||
Debt instrument, stated percentage | 6.00% | ||||||||||
Debt instrument due date description | Convertible senior unsecured notes due 2021 | ||||||||||
Debt instrument, conversion price per share | $ / shares | $ 9.11 | ||||||||||
Previously Reported [Member] | |||||||||||
Accumulated deficit | $ | 155,500,000 | $ 155,500,000 | |||||||||
Retained deficit in equity | $ | 155,500,000 | ||||||||||
Overstated Value [Member] | |||||||||||
Accumulated deficit | $ | $ 320,000 | $ 320,000 |
Business Description, Basis o_5
Business Description, Basis of Presentation and Summary of Significant Accounting Policies - Summary of Revenues from Product Lines (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Total revenue | $ 15,271 | $ 18,741 | $ 31,997 | $ 36,674 |
Percentage of total revenue | 100.00% | 100.00% | 100.00% | 100.00% |
Orthobiologics [Member] | ||||
Total revenue | $ 11,020 | $ 12,713 | $ 23,020 | $ 24,818 |
Percentage of total revenue | 72.00% | 68.00% | 72.00% | 68.00% |
Spinal Implant [Member] | ||||
Total revenue | $ 4,177 | $ 5,940 | $ 8,863 | $ 11,665 |
Percentage of total revenue | 27.00% | 32.00% | 27.00% | 31.00% |
Other Revenue [Member] | ||||
Total revenue | $ 74 | $ 88 | $ 114 | $ 191 |
Percentage of total revenue | 1.00% | 0.00% | 1.00% | 1.00% |
Business Description, Basis o_6
Business Description, Basis of Presentation and Summary of Significant Accounting Policies - Schedule of Assets and Liabilities Measured on Recurring Basis (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Warrant derivative liability | $ 21 | $ 10 |
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | ||
Warrant derivative liability | ||
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | ||
Warrant derivative liability | ||
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Recurring [Member] | ||
Warrant derivative liability | $ 21 | $ 10 |
Business Description, Basis o_7
Business Description, Basis of Presentation and Summary of Significant Accounting Policies - Schedule of Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2019USD ($) | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Balance | $ 10 |
Loss recognized in earnings | 11 |
Balance | $ 21 |
Inventories, Net (Details Narra
Inventories, Net (Details Narrative) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Inventory Disclosure [Abstract] | ||
Implants and biological inventory | $ 9,200 | $ 8,800 |
Inventories, Net - Schedule of
Inventories, Net - Schedule of Inventories (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 3,465 | $ 3,519 |
Work in process | 1,480 | 949 |
Finished goods | 23,534 | 25,235 |
Gross inventories | 28,479 | 29,703 |
Reserve for obsolescence | (12,651) | (12,402) |
Total inventories, net | $ 15,828 | $ 17,301 |
Property and Equipment, Net (De
Property and Equipment, Net (Details Narrative) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Property, Plant and Equipment [Line Items] | |||
Estimated useful lives of assets | 5 years | ||
Property, plant and equipment, net | $ 5,600 | $ 7,174 | |
Depreciation expense | 1,500 | $ 1,600 | |
Capital leased assets, gross | 1,600 | ||
Capital leases, lessee balance sheet, assets by major class, accumulated depreciation | 1,000 | ||
Surgical Instruments Property Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, net | $ 4,900 | $ 4,400 |
Property and Equipment, Net - S
Property and Equipment, Net - Schedule of Property and Equipment, Net (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment [Line Items] | ||
Total cost | $ 19,965 | $ 20,083 |
Less: accumulated depreciation | (14,365) | (12,909) |
Property and equipment, net | 5,600 | 7,174 |
Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | 4,082 | 4,145 |
Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | 455 | 481 |
Computer Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | 570 | 570 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | 99 | 164 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | 3,955 | 3,941 |
Vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | 10 | 10 |
Surgical Instruments [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | $ 10,794 | $ 10,772 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Dec. 31, 2018 | Jun. 30, 2019 | |
Goodwill impairment charge | $ 38,300 | |
Goodwill | $ 3,205 | $ 3,205 |
Tradenames, Technology and Customer Relationships [Member] | ||
Assets impairment charges | $ 9,800 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Patents | $ 847 | $ 847 |
Accumulated amortization | (303) | (274) |
Intangible assets, net | $ 544 | $ 573 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Schedule of Estimated Amortization Expense for Intangible Assets (Details) $ in Thousands | Jun. 30, 2019USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Remainder of 2019 | $ 30 |
2020 | 58 |
2021 | 58 |
2022 | 58 |
2023 | 58 |
Thereafter | 282 |
Total | $ 544 |
Accrued Liabilities - Schedule
Accrued Liabilities - Schedule of Accrued Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Payables and Accruals [Abstract] | ||
Wages/commissions payable | $ 3,808 | $ 3,332 |
Other accrued liabilities | 2,059 | 1,818 |
Accrued liabilities | $ 5,867 | $ 5,150 |
Debt (Details Narrative)
Debt (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | Mar. 29, 2019 | Sep. 17, 2018 | Feb. 14, 2018 | Jan. 17, 2018 | Mar. 31, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | Apr. 02, 2019 | Dec. 31, 2018 |
Debt instrument, basis spread on variable rate | 13.45% | ||||||||
Debt instrument description | The Optional PIK Interest (as such term is defined in the Prior Credit Agreement) was decreased from 15% plus the LIBO Rate (as such term is defined in the Amended and Restated Credit Agreement) to 10% plus the LIBO Rate, with a 2.3125% floor; a LIBO Rate floor of 2.3125% was added | ||||||||
Issuance of warrants to purchase a common stock | 1,200,000 | ||||||||
Exercise price of warrants | $ 0.01 | $ 4.31 | $ 7.33 | ||||||
Warrants expiration date | Aug. 1, 2028 | ||||||||
Debt instrument maturity date | Mar. 31, 2021 | ||||||||
Long-term debt | $ 73,831 | $ 77,939 | |||||||
2019 Warrants [Member] | Investors [Member] | |||||||||
Issuance of warrants to purchase a common stock | 1,200 | ||||||||
Exercise price of warrants | $ 0.01 | ||||||||
Warrants expiration date | Apr. 1, 2029 | ||||||||
2019 Warrants [Member] | April 1, 2019 [Member] | Investors [Member] | |||||||||
Issuance of warrants to purchase a common stock | 1,200,000 | ||||||||
Exercise price of warrants | $ 0.01 | ||||||||
Warrants expiration date | Apr. 1, 2029 | ||||||||
Second Amended and Restated Credit Agreement [Member] | |||||||||
Debt instrument description | no interest will accrue on the Loans under the Second Amended and Restated Credit Agreement from and after January 1, 2019 until March 31, 2020; beginning April 1, 2020 through the maturity date of the Second Amended and Restated Credit Agreement, interest payable in cash will accrue on the Loans under the Credit Agreement at a rate per annum equal to the sum of (a) 10.00% plus (b) the higher of (x) the LIBO Rate (as such term is defined in the Second Amended and Restated Credit Agreement) and (y) 2.3125%; the maturity date of the Loans is March 31, 2021; | ||||||||
Debt instrument face amount | $ 2,200 | $ 55,800 | |||||||
Debt instrument maturity date | Mar. 31, 2021 | Mar. 31, 2021 | |||||||
Long-term debt | $ 72,700 | $ 73,800 | |||||||
Increase in additional paid-in capital | $ 7,300 | ||||||||
Accrued PIK interest | $ 29,000 | ||||||||
New effective interest rate | 13.19% | ||||||||
Second Amended and Restated Credit Agreement [Member] | Forecast [Member] | |||||||||
Cash balance | $ 1,500 | ||||||||
Second Amended and Restated Credit Agreement [Member] | Investors [Member] | |||||||||
Debt instrument face amount | $ 10,000 | ||||||||
Maximum [Member] | |||||||||
Credit facility percentage | 2.00% | ||||||||
Minimum [Member] | |||||||||
Credit facility percentage | 1.00% | ||||||||
Twenty-Third Amendment to Amended and Restated Credit Agreement [Member] | Through December 31, 2018 [Member] | |||||||||
Debt instrument, basis spread on variable rate | 12.00% | ||||||||
Debt instrument interest rate portion payable in cash | 10.00% | ||||||||
Twenty-Third Amendment to Amended and Restated Credit Agreement [Member] | January 1, 2019 through June 30, 2019 [Member] | |||||||||
Debt instrument, basis spread on variable rate | 15.00% | ||||||||
Debt instrument interest rate portion payable in cash | 10.00% | ||||||||
Twenty-Third Amendment to Amended and Restated Credit Agreement [Member] | July 1, 2019 through the maturity date [Member] | |||||||||
Debt instrument, basis spread on variable rate | 10.00% | ||||||||
Debt instrument, fee percentage | 1.00% | ||||||||
6.00% Convertible Senior Unsecured Notes [Member] | |||||||||
Debt instrument due date description | Convertible senior unsecured notes due 2021 | All of the outstanding 6.00% convertible senior unsecured notes due 2021 |
Debt - Schedule of Long-term De
Debt - Schedule of Long-term Debt (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Debt Disclosure [Abstract] | ||
Amounts due under Second Amended and Restated Credit Agreement | $ 72,657 | |
Amounts due under Prior Credit Agreement | 55,787 | |
PIK interest payable related to Credit Agreements | 1,149 | 27,178 |
Plus: 2% exit fee on Prior Credit Agreement | 133 | 254 |
Gross long-term debt | 73,939 | 83,219 |
Less: discount on Credit Agreements | (5,114) | |
Less: total debt issuance costs on Credit Agreements | (108) | (166) |
Long-term debt, less issuance costs | $ 73,831 | $ 77,939 |
Debt - Schedule of Maturities D
Debt - Schedule of Maturities Due on Debt (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Debt Disclosure [Abstract] | ||
Remainder of 2019 | ||
2020 | ||
2021 | 73,939 | |
2022 | ||
2023 | ||
Thereafter | ||
Long-term debt, less issuance costs | $ 73,831 | $ 77,939 |
Equity (Details Narrative)
Equity (Details Narrative) - USD ($) | May 18, 2018 | Feb. 14, 2018 | Feb. 14, 2018 | Jan. 17, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 |
Schedule of Equity Method Investments [Line Items] | ||||||||
Debt conversion of convertible debt | $ 71,865,000 | |||||||
Stock issued during period, shares, new issues | 129 | |||||||
Shares issued, price per share | $ 0.0869816 | |||||||
Stock issued during period, value, new issues | $ 900 | $ 1,000 | $ 79,199,000 | |||||
Share price | $ 7.20 | |||||||
Right offering expired date | Jun. 18, 2018 | |||||||
Maximum [Member] | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Stock issued during period, shares, new issues | 1,137,515 | |||||||
Private Placement SPA [Member] | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Stock issued during period, shares, new issues | 945,819 | |||||||
Shares issued, price per share | $ 7.20 | $ 7.20 | ||||||
Stock issued during period, value, new issues | $ 6,800,000 | |||||||
6.00% Convertible Senior Unsecured Notes [Member] | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Debt instrument due date description | Convertible senior unsecured notes due 2021 | All of the outstanding 6.00% convertible senior unsecured notes due 2021 | ||||||
Debt conversion of convertible debt | $ 70,300,000 | $ 1,600,000 | ||||||
Debt conversion, converted instrument, shares issued | 10,401,309 | 10,401,309 | 189,645 | |||||
Additional debt principal amount | $ 70,300,000 | $ 70,300,000 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | Aug. 01, 2018 | Jun. 30, 2019 | Jun. 30, 2018 |
Options granted to purchase shares | 100,000 | 0 | |
Exercise price share price | $ 2.24 | ||
Employees and Directors [Member] | |||
Allocated share-based compensation expense | $ 200 | $ 400 | |
2018 Equity Incentive Plan [Member] | |||
Term of plan, description | The 2018 Plan became effective immediately upon approval by our stockholders and will expire on July 31, 2028, unless terminated earlier. | ||
Number of common stock available for issuance | 1,307,747 | ||
Options granted to purchase shares | 130,770 | ||
Restricted stock granted during period, shares | 13,021 | ||
Options to purchase shares of common stock forfeited and cancelled | 420,000 | ||
Number of shares available for issuance | 1,110,935 | ||
Intrinsic value of options outstanding | $ 43 | ||
Stock options closing price per share | $ 3 | ||
2018 Equity Incentive Plan [Member] | Restricted Stock Units (RSUs) [Member] | |||
Options granted to purchase shares | 40,000 | ||
Xtant Medical Equity Incentive Plan [Member] | |||
Options granted to purchase shares | 18,135 | ||
Restricted stock granted during period, shares | 23,438 | ||
Options to purchase shares of common stock forfeited and cancelled | 3,053 | ||
Non-Plan Grants [Member] | |||
Options to purchase shares of common stock forfeited and cancelled | 25,000 |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Share-based Compensation, Stock Options, Activity (Details) - $ / shares | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Shares Granted | 100,000 | 0 |
Weighted Average Exercise Price, Granted | $ 2.24 | |
Equity Option [Member] | ||
Shares Outstanding, Beginning Balance | 496,958 | 67,465 |
Shares Granted | 100,000 | |
Shares Cancelled or Expired | (448,053) | (22,971) |
Shares Outstanding, Ending Balance | 148,905 | 44,494 |
Shares Exercisable, Ending Balance | 18,135 | 44,494 |
Weighted Average Exercise Price, Outstanding Beginning Balance | $ 9.90 | $ 71.03 |
Weighted Average Exercise Price, Granted | 2.24 | |
Weighted Average Exercise Price, Cancelled or Expired | 4.64 | 96.44 |
Weighted Average Exercise Price, Outstanding Ending Balance | 9.12 | 53.14 |
Weighted Average Exercise Price, Exercisable Ending Balance | 52.04 | 53.14 |
Weighted Average Fair Value at Grant Date, Outstanding Beginning Balance | 6.62 | 36.85 |
Weighted Average Fair Value at Grant Date, Granted | 1.95 | |
Weighted Average Fair Value at Grant Date, Cancelled or Expired | 3.69 | 46.94 |
Weighted Average Fair Value at Grant Date, Outstanding Ending Balance | 6.53 | 27.36 |
Weighted Average Fair Value at Grant Date, Exercisable, Ending Balance | $ 33.67 | $ 27.36 |
Stock-Based Compensation - Sc_2
Stock-Based Compensation - Schedule of Assumptions of Stock Option Granted (Details) | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Stock-based Compensation - Schedule Of Assumptions Of Stock Option Granted | ||
Risk free interest rate | 2.70% | 0.00% |
Dividend yield | 0.00% | 0.00% |
Expected term | 10 years | 0 years |
Expected volatility | 91.00% | 0.00% |
Expected forfeiture rate | 30.00% | 0.00% |
Warrants (Details Narrative)
Warrants (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | |||
Jun. 30, 2019 | Apr. 02, 2019 | Dec. 31, 2018 | Sep. 17, 2018 | |
Class of Warrant or Right [Line Items] | ||||
Issuance of warrants to purchase a common stock | 1,200,000 | |||
Exercise price of warrants | $ 4.31 | $ 7.33 | $ 0.01 | |
Warrants expiration date | Aug. 1, 2028 | |||
Number of outstanding common stock warrants | 2,910,609 | 1,710,609 | ||
Unrealized loss on warranty derivative liability | $ 11 | |||
2019 Warrants [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Fair value of warrants | $ 9 | |||
2019 Warrants [Member] | Investors [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Issuance of warrants to purchase a common stock | 1,200 | |||
Exercise price of warrants | $ 0.01 | |||
Warrants expiration date | Apr. 1, 2029 | |||
Number of outstanding common stock warrants | 2,910,609 |
Warrants - Schedule of Warrant
Warrants - Schedule of Warrant Activity (Details) | 6 Months Ended |
Jun. 30, 2019$ / sharesshares | |
Warrants and Rights Note Disclosure [Abstract] | |
Common Stock Warrants Outstanding, Beginning Balance | 1,710,609 |
Common Stock Warrants, Issued | 1,200,000 |
Common Stock Warrants, Expired | |
Common Stock Warrants Outstanding, Ending Balance | 2,910,609 |
Weighted Average Exercise Price Outstanding Beginning Balance | $ / shares | $ 7.33 |
Weighted Average Exercise Price, Issued | 0.01 |
Weighted Average Exercise Price, Expired | $ / shares | |
Weighted Average Exercise Price Outstanding Ending Balance | $ / shares | $ 4.31 |
Warrants - Schedule of Warran_2
Warrants - Schedule of Warrant Valuation Assumptions (Details) - Warrant [Member] - Segment | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Warrants and rights outstanding, measurement Input, expected term (In years) | 3 years 2 months 12 days | 4 years 1 month 6 days |
Value of Underlying Common Stock (Per share) [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Warrants and rights outstanding, measurement Input | 3 | 5.55 |
Risk Free Interest Rate [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Warrants and rights outstanding, measurement Input | 0.018 | 0.0262 |
Volatility [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Warrants and rights outstanding, measurement Input | 0.87 | 0.62 |
Dividend Yield [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Warrants and rights outstanding, measurement Input | 0 | 0 |
Warrants - Schedule of Warrants
Warrants - Schedule of Warrants Activities Used in Derivative Liability (Details) - shares | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Class of Warrant or Right [Line Items] | ||
Common Stock Warrants Outstanding, Beginning Balance | 1,710,609 | |
Common Stock Warrants Outstanding, Ending Balance | 2,910,609 | |
Warrant [Member] | ||
Class of Warrant or Right [Line Items] | ||
Common Stock Warrants Outstanding, Beginning Balance | 87,509 | 93,759 |
Derivative warrants issued | ||
Derivative warrants exercised | ||
Derivative warrants expired | (6,250) | |
Common Stock Warrants Outstanding, Ending Balance | 87,509 | 87,509 |
Commitments and Contingencies_2
Commitments and Contingencies (Details Narrative) - USD ($) $ in Thousands | Aug. 10, 2017 | Jun. 30, 2019 | Jun. 30, 2018 |
Operating lease expiration description | Expiration dates between 2019 and 2025 | ||
Security deposits | $ 36 | ||
Operating lease weighted-average remaining lease term | 5 years 2 months 30 days | ||
Operating lease weighted-average discount rate | 5.20% | ||
Rent expense | $ 11 | ||
Loss contingency, damages sought, value | $ 1,000 | ||
Minimum [Member] | |||
Lessee leasing arrangements operating leases term of each option to extend | 5 years | ||
Maximum [Member] | |||
Lessee leasing arrangements operating leases term of each option to extend | 10 years |
Commitments and Contingencies -
Commitments and Contingencies - Schedule of Right-of-use Assets and Lease Liability (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Commitments And Contingencies - Schedule Of Right-of-use Assets And Lease Liability | ||
Right-of-use assets, net | $ 2,296 | |
Current portion of lease liability | 511 | |
Lease liability, less current portion | 1,796 | |
Total lease liability | $ 2,307 |
Commitments and Contingencies_3
Commitments and Contingencies - Schedule of Future Minimum Rental Payments for Operating Leases (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Commitments and Contingencies Disclosure [Abstract] | ||
Remainder of 2019 | $ 282 | |
2020 | 511 | |
2021 | 516 | |
2022 | 532 | |
2023 | 473 | |
Thereafter | 404 | |
Total future minimum lease payments | 2,718 | |
Less amount representing interest | (411) | |
Present value of obligations under operating leases | 2,307 | |
Less current portion | (511) | |
Long-term operating lease obligations | $ 1,796 |
Commitments and Contingencies_4
Commitments and Contingencies - Schedule of Future Minimum Lease Payments for Capital Leases (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Commitments and Contingencies Disclosure [Abstract] | ||
Remainder of 2019 | $ 173 | |
2020 | 218 | |
2021 | ||
2022 | ||
2023 | ||
Thereafter | ||
Total minimum lease payments | 391 | |
Less amount representing interest | (38) | |
Present value of obligations under capital leases | 353 | |
Less current portion | (337) | $ (426) |
Long-term capital lease obligations | $ 16 | $ 204 |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) - USD ($) | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Income Tax Disclosure [Abstract] | ||
Interest or penalties related to income taxes |
Supplemental Disclosure of Ca_3
Supplemental Disclosure of Cash Flow Information - Schedule of Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Supplemental Cash Flow Elements [Abstract] | ||
Interest | $ 47 | $ 170 |
Issuance of capital leases | 84 | |
Lease liability from right-of-use assets | 2,296 | |
Interest converted into common stock | 556 | |
Conversion of convertible debt to equity | 71,865 | |
Convertible PIK interest | 4,764 | |
Conversion of interest related to the Credit Facility to long-term debt | 7,977 | |
Write-off of convertible debt issuance cost | 1,012 | |
Transfer of inventory to property and equipment | 439 | |
Extinguishment of Prior Credit Agreement (including debt issuance costs) | 79,264 | |
Write-off of Prior Credit Agreement debt issuance costs and existing ROS fees | 307 | |
Recognition of Second Amended and Restated Credit Agreement | 72,657 | |
Recognition of 2019 Warrants | $ 9 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) $ in Thousands | Apr. 05, 2019 | Jun. 30, 2019 | Jun. 30, 2018 |
Related Party Transaction [Line Items] | |||
Operating lease description | Expiration dates between 2019 and 2025 | ||
Monthly rental fee | $ 11 | ||
Sublease Agreement [Member] | Cardialen, Inc., [Member] | |||
Related Party Transaction [Line Items] | |||
Operating lease description | portion of Cardialen's office space commencing April 2019, on a month-to-month basis until January 2024, unless terminated earlier upon notice of 60 days, for a monthly rental fee of approximately $2,100 for 2019. | ||
Monthly rental fee | $ 2,100 | ||
Investors [Member] | |||
Related Party Transaction [Line Items] | |||
Ownership percentage | 70.00% |
Segment and Geographic Inform_3
Segment and Geographic Information (Details Narrative) | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Concentration risk, percentage | 10.00% | |
Geographic Concentration Risk [Member] | United States [Member] | Sales Revenue, Net [Member] | ||
Concentration risk, percentage | 96.00% | 95.00% |
Segment and Geographic Inform_4
Segment and Geographic Information - Schedule of Revenues by Geographic Region (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Total revenue | $ 15,271 | $ 18,741 | $ 31,997 | $ 36,674 |
United States [Member] | ||||
Total revenue | 14,585 | 17,319 | 30,702 | 34,792 |
Rest of World [Member] | ||||
Total revenue | $ 686 | $ 1,422 | $ 1,295 | $ 1,882 |