Document_and_Entity_Informatio
Document and Entity Information | 12 Months Ended |
Dec. 31, 2013 | |
Document and Entity Information [Abstract] | ' |
Document Type | 'S-1 |
Amendment Flag | 'false |
Entity Registrant Name | 'EKSO BIONICS HOLDINGS, INC. |
Entity Central Index Key | '0001549084 |
Document Period End Date | 31-Dec-13 |
Entity Filer Category | 'Smaller Reporting Company |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Current Assets | ' | ' |
Cash | $805,306 | $1,738,662 |
Accounts receivable | 549,469 | 788,241 |
Inventories, net | 725,096 | 615,365 |
Note receivable from stockholder | 103,735 | 99,035 |
Prepaid expenses and other current assets | 250,998 | 109,236 |
Deferred cost of revenue, current | 768,599 | 436,483 |
Total current assets | 3,203,203 | 3,787,022 |
Property and equipment, net | 1,575,286 | 1,665,191 |
Deferred cost of revenue, non-current | 803,298 | 693,763 |
Security deposits | 54,390 | 54,390 |
Security issuance costs | 947,760 | 9,460 |
Total assets | 6,583,937 | 6,209,826 |
Current Liabilities | ' | ' |
Notes payable, current | 1,638,505 | 1,656,040 |
Convertible debt | 5,062,417 | 3,528,313 |
Accounts payable | 1,498,680 | 1,729,731 |
Accrued liabilities | 1,430,799 | 997,476 |
Customer advances and deferred revenues, current | 2,419,226 | 1,566,153 |
Liability due to early stock option exercise | 5,293 | 10,587 |
Total current liabilities | 12,054,920 | 9,488,300 |
Customer advances and deferred revenues, non-current | 2,209,111 | 1,898,560 |
Notes payable, non-current | 866,950 | 2,509,634 |
Warrant liability | 377,747 | 563,822 |
Deferred rent | 123,709 | 159,916 |
Total Liabilities | 15,632,437 | 14,620,232 |
Commitments and contingencies (Note 16) | ' | ' |
Convertible preferred stock issuable in series, $0.001 par value; 22,000,000, and 10,365,000 shares authorized at December 31, 2013 and 2012 respectively; 14,011,028 and 8,831,684 shares issued and outstanding at December 31, 2013 and 2012 respectively; liquidation preference of $1.75 - $2.10 per share at December 31, 2013 and 2012 | 27,324,208 | 16,675,983 |
Stockholders' deficit: | ' | ' |
Common stock, $0.001 par value; 40,000,000 and 30,000,000 shares authorized at December 31, 2013 and 2012, respectively; 10,391,400 and 9,887,079, shares issued and outstanding at December 31, 2013 and 2012, respectively | 10,025 | 9,920 |
Additional paid-in capital | 1,648,886 | 1,047,936 |
Accumulated deficit | -38,031,619 | -26,144,245 |
Total stockholders' deficit | -36,372,708 | -25,086,389 |
Total liabilities, convertible preferred stock and stockholders' deficit | $6,583,937 | $6,209,826 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Consolidated Balance Sheets [Abstract] | ' | ' |
Preferred stock, par value per share | $0.00 | $0.00 |
Preferred stock, shares authorized | 22,000,000 | 10,365,000 |
Preferred stock, shares issued | 14,011,028 | 8,831,684 |
Preferred stock, shares outstanding | 14,011,028 | 8,831,684 |
Common stock, par value per share | $0.00 | $0.00 |
Common stock, shares authorized | 40,000,000 | 30,000,000 |
Common stock, shares issued | 10,391,400 | 9,887,079 |
Common stock, shares outstanding | 10,391,400 | 9,887,079 |
Minimum [Member] | ' | ' |
Statement [Line Items] | ' | ' |
Preferred stock, liquidation preference per share | $1.75 | $1.75 |
Maximum [Member] | ' | ' |
Statement [Line Items] | ' | ' |
Preferred stock, liquidation preference per share | $2.10 | $2.10 |
Consolidated_Statement_of_Oper
Consolidated Statement of Operations (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Revenue: | ' | ' |
Medical devices | $1,611,709 | $566,222 |
Engineering services | 1,690,235 | 2,140,355 |
Total revenue | 3,301,944 | 2,706,577 |
Cost of revenue: | ' | ' |
Cost of medical devices | 1,460,692 | 553,429 |
Cost of engineering services | 1,253,942 | 1,782,848 |
Total cost of revenue | 2,714,634 | 2,336,277 |
Gross Profit | 587,310 | 370,300 |
Operating expenses: | ' | ' |
General and administrative | 3,913,047 | 4,381,067 |
Research and development | 2,677,310 | 4,304,317 |
Sales and marketing | 4,291,282 | 5,925,905 |
Total operating expenses | 10,881,639 | 14,611,289 |
Loss from operations | -10,294,329 | -14,240,989 |
Other income (expense): | ' | ' |
Interest expense | -1,726,455 | -736,346 |
Interest income | 5,225 | 10,692 |
Non-cash gain on changes in fair value of warrants | 186,075 | 17,126 |
Other expense, net | -57,890 | -92,441 |
Total other income (expense), net | -1,593,045 | -800,969 |
Net loss | ($11,887,374) | ($15,041,958) |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Stockholders' Deficit (USD $) | Total | Convertible Preferred Stock [Member] | Convertible Preferred Stock [Member] | Convertible Preferred Stock [Member] | Common Stock [Member] | Common Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Additional Paid-in Capital [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Accumulated Deficit [Member] | Accumulated Deficit [Member] |
Series A-2 [Member] | Series B [Member] | Series A-2 [Member] | Series B [Member] | Series A-2 [Member] | Series B [Member] | Series A-2 [Member] | Series B [Member] | ||||||
Beginning balance at Dec. 31, 2011 | ($10,422,034) | $8,199,909 | ' | ' | $9,739 | ' | ' | $670,514 | ' | ' | ($11,102,287) | ' | ' |
Beginning balance, shares at Dec. 31, 2011 | ' | 4,820,549 | ' | ' | 9,738,580 | ' | ' | ' | ' | ' | ' | ' | ' |
Issuance of convertible preferred stock in exchange for cash | ' | ' | 8,476,074 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Issuance of convertible preferred stock in exchange for cash, shares | ' | ' | 4,011,135 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Issuance of common stock upon exercise of options | 31,716 | ' | ' | ' | 156 | ' | ' | 31,560 | ' | ' | ' | ' | ' |
Issuance of common stock upon exercise of options, shares | 156,624 | ' | ' | ' | 156,624 | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock repurchased | -812 | ' | ' | ' | -8 | ' | ' | -804 | ' | ' | ' | ' | ' |
Common stock repurchased, shares | ' | ' | ' | ' | -8,125 | ' | ' | ' | ' | ' | ' | ' | ' |
Vesting of early exercised options | 13,233 | ' | ' | ' | 33 | ' | ' | 13,200 | ' | ' | ' | ' | ' |
Stock-based compensation expense | 333,466 | ' | ' | ' | ' | ' | ' | 333,466 | ' | ' | ' | ' | ' |
Net loss | -15,041,958 | ' | ' | ' | ' | ' | ' | ' | ' | ' | -15,041,958 | ' | ' |
Ending balance at Dec. 31, 2012 | -25,086,389 | 16,675,983 | ' | ' | 9,920 | ' | ' | 1,047,936 | ' | ' | -26,144,245 | ' | ' |
Ending balance, shares at Dec. 31, 2012 | ' | 8,831,684 | ' | ' | 9,887,079 | ' | ' | ' | ' | ' | ' | ' | ' |
Issuance of convertible preferred stock in exchange for cash | ' | ' | ' | 4,294,259 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Issuance of convertible preferred stock in exchange for cash, shares | ' | ' | ' | 2,088,820 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Issuance of Series B convertible preferred stock upon conversion of convertible debt and accrued interest | 136,380 | 6,490,071 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Issuance of Series B convertible preferred stock upon conversion of convertible debt and accrued interest, shares | ' | 3,090,524 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock warrants issued in connection with issuance of Series B convertible preferred stock | ' | 275 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock warrants issued in connection with issuance of Series B convertible preferred stock | ' | -136,380 | ' | ' | ' | ' | ' | 136,380 | ' | ' | ' | ' | ' |
Issuance of common stock upon exercise of options | 65,593 | ' | ' | ' | 94 | ' | ' | 65,499 | ' | ' | ' | ' | ' |
Issuance of common stock upon exercise of options, shares | 504,321 | ' | ' | ' | 506,196 | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock repurchased | -189 | ' | ' | ' | -2 | ' | ' | -187 | ' | ' | ' | ' | ' |
Common stock repurchased, shares | ' | ' | ' | ' | -1,875 | ' | ' | ' | ' | ' | ' | ' | ' |
Vesting of early exercised options | 3,974 | ' | ' | ' | 13 | ' | ' | 3,961 | ' | ' | ' | ' | ' |
Compensation expense for options issued a non-employee | 4,679 | ' | ' | ' | ' | ' | ' | 4,679 | ' | ' | ' | ' | ' |
Stock-based compensation expense | 390,618 | ' | ' | ' | ' | ' | ' | 390,618 | ' | ' | ' | ' | ' |
Net loss | -11,887,374 | ' | ' | ' | ' | ' | ' | ' | ' | ' | -11,887,374 | ' | ' |
Ending balance at Dec. 31, 2013 | ($36,372,708) | $27,324,208 | ' | ' | $10,025 | ' | ' | $1,648,886 | ' | ' | ($38,031,619) | ' | ' |
Ending balance, shares at Dec. 31, 2013 | ' | 14,011,028 | ' | ' | 10,391,400 | ' | ' | ' | ' | ' | ' | ' | ' |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Stockholders' Deficit (Parenthetical) (USD $) | Dec. 31, 2012 | Dec. 31, 2013 |
Series A-2 [Member] | Series B [Member] | |
Shares issued price per share | $2.10 | $2.10 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Operating activities: | ' | ' |
Net loss | ($11,887,374) | ($15,041,958) |
Adjustments to reconcile net loss to net cash used in operating activities: | ' | ' |
Depreciation and amortization | 468,906 | 342,078 |
Loss on sale of property and equipment | 223 | 20,212 |
Inventory allowance expense | -7,574 | 19,432 |
Amortization of deferred rent | -36,207 | 157,066 |
Amortization of debt discounts | 169,248 | 120,931 |
Amortization of notes payable offering costs | 21,137 | 7,871 |
Interest expense accrued to convertible notes | 230,805 | 42,475 |
Interest income added to note receivable from stockholder | ' | -3,810 |
Fair value of warrant accounted for as a reduction of revenue | ' | 57,494 |
Adjustment to record convertible note at fair value | 799,194 | 174,292 |
Stock-based compensation expense | 390,617 | 333,466 |
Gain due to changes in fair value of warrant liability | -186,075 | -17,126 |
Changes in operating assets and liabilities: | ' | ' |
Accounts receivable | 238,771 | -396,603 |
Inventories | -102,157 | -828,776 |
Prepaid expense and other assets | -87,335 | -5,326 |
Deferred costs of revenue | -441,650 | -1,130,246 |
Accounts payable | -231,050 | 808,813 |
Accrued liabilities | 433,323 | 74,259 |
Customer advances and deferred revenues | 1,163,626 | 2,602,311 |
Net cash used in operating activities | -9,063,577 | -12,663,145 |
Investing activities: | ' | ' |
Security deposits | ' | 10,000 |
Note receivable from stockholder | ' | -45,000 |
Acquisition of property and equipment | -393,734 | -832,303 |
Proceeds from sales of property and equipment | 14,511 | 2,465 |
Net cash used in investing activities | -379,223 | -864,838 |
Financing activities: | ' | ' |
Proceeds from issuance of 2013 Series B Convertible Bridge Notes, net of issuance costs | 4,929,196 | ' |
Proceeds from issuance of notes payable and warrants, net of issuance costs | ' | 3,500,000 |
Principal payments on notes payable | -1,829,466 | -609,753 |
Proceeds from issuance of 2012 Series B Convertible Bridge Notes | 2,000,000 | 3,311,546 |
Proceeds from issuance of convertible preferred stock and warrants, net of issuance costs | 4,152,329 | 8,476,074 |
Payments for private placement offerings | -947,758 | ' |
Proceeds from issuance of common stock, net of repurchases | 205,143 | 30,904 |
Net cash provided by financing activities | 8,509,444 | 14,708,771 |
Net (decrease) increase in cash | -933,356 | 1,180,788 |
Cash at beginning of period | 1,738,662 | 557,874 |
Cash at end of period | 805,306 | 1,738,662 |
Supplemental disclosure of cash flow activities: | ' | ' |
Cash paid for interest | 632,540 | 387,391 |
Cash paid for taxes | 25,035 | 172 |
Supplemental disclosure of non-cash activities: | ' | ' |
Acquisition of property and equipment with note payable | ' | 200,000 |
Acquisition of property and equipment with capital lease | ' | 23,079 |
Preferred stock and common warrants issued to lender | 5,293 | 355,116 |
Conversion of principal on convertible notes into Series B convertible preferred stock | 6,490,071 | ' |
Common stock warrants issued in connection with Series B convertible preferred stock offering | 168,872 | ' |
Vesting of early exercised stock options | $5,283 | $13,233 |
Organization
Organization | 12 Months Ended |
Dec. 31, 2013 | |
Organization [Abstract] | ' |
Organization | ' |
1. Organization | |
Description of Business | |
Ekso Bionics, Inc. (the "Company") was incorporated in January 2005 in the State of Delaware and is currently headquartered in Richmond, California. The Company, a leading developer and manufacturer of human bionic exoskeletons, was founded after the University of California at Berkeley's Robotics and Human Engineering Laboratory had a breakthrough in demonstrating human exoskeletons that are more energy efficient than previously thought possible. | |
Ekso Bionics pioneered the field of human exoskeletons to augment human strength, endurance and mobility. Ekso Bionics designs, develops and sells wearable robots, or "human exoskeletons," that have applications in medical, military, industrial, and consumer markets. The Company's exoskeleton systems are strapped over the user's clothing, enabling individuals with neurological conditions affecting gait (e.g., spinal cord injury or stroke) to walk again; permitting soldiers to carry heavy loads for long distances while mitigating lower back, knee, and ankle injuries; and allowing industrial workers to perform heavy duty work for extended periods. | |
Ekso Bionics' current medical device, or exoskeleton - the Ekso GTTM, or "Ekso," is used by hospitals on patients with lower extremity weakness or paralysis. Our products have been listed with the U.S. Food and Drug Administration ("FDA") and have received a CE Mark (indicating compliance with European Union legislation). We have sold over 50 devices to rehabilitation centers and individual users for rehabilitation since February 2012. Ekso Bionics also has a collaborative partnership with Lockheed Martin Corporation ("Lockheed") to develop products for military applications. | |
A wholly-owned UK subsidiary serves as the Company's sales and marketing agent for Ekso products in Europe. | |
Subsequent to December 31, 2013, the Company entered into a merger agreement with PN Medical Group Inc. See Note 18, Subsequent Events, Merger with Ekso Bionics Holdings, Inc. | |
Liquidity | |
The Company has incurred significant operating losses and negative cash flows from operations. At December 31, 2013, the Company had an accumulated deficit of $38,031,619, a working capital deficit of $8,851,717 and a stockholders' deficit of $36,372,708. | |
Management believes that the Company's cash resources as of December 31, 2013, along with the proceeds received in connection with the PPO discussed in Note 18, Subsequent Events, Merger with Ekso Bionics Holdings, Inc., received in January and February 2014, are sufficient to implement its business plan, support operations, fund research and development and meet its obligations through at least the middle of 2015. The Company plans to raise additional capital to finance its operations beyond the middle of 2015. There can be no assurance that financing will be available when required in sufficient amounts, on acceptable terms or at all. In the event that the necessary additional financing is not obtained, the Company may have to reduce its discretionary overhead costs substantially, including research and development, general and administrative and sales and marketing expenses or otherwise curtail operations. | |
Summary_of_Significant_Account
Summary of Significant Accounting Policies and Estimates | 12 Months Ended | ||
Dec. 31, 2013 | |||
Summary of Significant Accounting Policies and Estimates [Abstract] | ' | ||
Summary of Significant Accounting Policies and Estimates | ' | ||
2. Summary of Significant Accounting Policies and Estimates | |||
Principles of Consolidation | |||
The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States and include the accounts of Ekso Bionics, Inc. and its wholly-owned subsidiary, Ekso Bionics, Ltd. All significant intercompany transactions and balances have been eliminated. | |||
Use of Estimates | |||
The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America ("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the balance sheet, and the reported amounts of revenues and expenses during the reporting period. For the Company, these estimates include, but are not limited to: revenue recognition, useful lives assigned to long-lived assets, realizability of deferred tax assets, valuation of common and preferred stock warrants and options, and the valuation of common stock for purposes of determining stock-based compensation and contingencies. Actual results could differ from those estimates. | |||
Foreign Currency Translation | |||
The Company uses the U.S. dollar as its functional currency. Since some of the Company's transactions are executed in various non-U.S. dollar currencies, the Company converts these transactions into U.S. dollars for reporting purposes. Income, expenses and cash flows are translated at average exchange rates prevailing during the reporting period, and assets and liabilities are translated at year-end exchange rates. Foreign exchange transaction gains and losses are included in other income (expense), in the accompanying consolidated statements of operations. Amounts of such gains and losses were not significant through December 31, 2013. | |||
Cash and Cash Equivalents | |||
The Company considers all highly liquid investments purchased with a maturity of three months or less to be cash equivalents. The Company's cash is deposited in bank accounts with the Company's primary cash management bank. The Company places its cash and cash equivalents in highly liquid instruments with, and in the custody of, financial institutions with high credit ratings and limits the amounts invested with any one institution, type of security and issuer. The Company did not have any cash equivalents or investments in money market funds as of December 31, 2013 and 2012. | |||
Concentration of Credit Risk and Other Risks and Uncertainties | |||
Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and accounts receivable. The Company maintains its cash accounts in excess of federally insured limits. However, management believes the Company is not exposed to significant credit risk due to the financial position of the depository institutions in which these deposits are held. | |||
The Company extends credit to customers in the normal course of business and performs ongoing credit evaluations of its customers. Concentrations of credit risk with respect to accounts receivable exist to the full extent of amounts presented in the consolidated financial statements. The Company performs ongoing credit evaluations of its customers and does not require collateral from its customers to secure accounts receivable. | |||
Accounts receivable are derived from the sale of products shipped and services performed for customers located in the U.S. and throughout the world. Invoices are aged based on contractual terms with the customer. The Company reviews its accounts receivable for collectability and provides an allowance for credit losses, as needed. The Company has not experienced any losses related to accounts receivable as of December 31, 2013 and 2012. | |||
Many of the sales contracts with customers outside of the U.S. are settled in a foreign currency other than the U.S. dollar. The Company does not enter into any foreign currency hedging agreements and is susceptible to gains and losses from foreign currency fluctuations. To date, the Company has not experienced significant gains or losses upon settling foreign contracts. | |||
In 2013, the Company had two customers with accounts receivable balances totaling 10% or more of the Company's total accounts receivable (28% and 19%), compared with four customers in 2012 (26%, 24%, 21% and 17%). | |||
In 2013, the Company had three customers with net revenue balances of 10% or more of the Company's total customer revenue (24%, 12% and 10%), compared with four customers in 2012 (32%, 15%, 12% and 10%). | |||
Inventories, net | |||
Inventories are recorded at the lower of cost or market value. Cost is principally determined using the average cost method. Parts from vendors are received and recorded as raw material. Once the raw materials are incorporated in the fabrication of the product, the related value of the component is recorded as work in progress ("WIP"). Direct and indirect labor and applicable overhead costs are also allocated and recorded to WIP inventory. Finished goods are comprised of completed products that are ready for customer shipment. The Company periodically evaluates the carrying value of inventory on hand for potential excess amounts over sales and forecasted demand. Excess and obsolete inventories identified would be recorded as an inventory impairment charge to the consolidated statement of operations. | |||
Property and Equipment | |||
Property and equipment are stated at cost less accumulated depreciation and are depreciated on a straight-line basis over the estimated useful lives of the assets, generally ranging from three to five years. Leasehold improvements are amortized over the shorter of their estimated useful lives or the related terms of the leases, generally ranging from five to ten years. | |||
The costs of repairs and maintenance are expensed when incurred, while expenditures for refurbishments and improvements that significantly add to the productive capacity or extend the useful life of an asset are capitalized. When assets are retired or sold, the asset cost and related accumulated depreciation or amortization are removed from the accompanying consolidated balance sheets, with any gain or loss reflected in the accompanying consolidated statements of operations. | |||
Impairment of Long-Lived Assets | |||
The Company assesses the impairment of long-lived assets whenever events or changes in circumstances indicate that their carrying value may not be recoverable from the estimated future cash flows expected to result from their use or eventual disposition. The Company's long-lived assets subject to this evaluation include only property and equipment. If estimates of future undiscounted net cash flows are insufficient to recover the carrying value of the assets, the Company will record an impairment loss in the amount by which the carrying value of the assets exceeds the fair value. If the assets are determined to be recoverable, but the useful lives are shorter than originally estimated, the Company will depreciate or amortize the net book value of the assets over the newly determined remaining useful lives. For each of the years ended December 31, 2013 and 2012, none of the Company's property and equipment was determined to be impaired. Accordingly, no impairment loss has been recognized. | |||
Convertible Debt Instruments | |||
The Company accounts for hybrid contracts that feature conversion options in accordance with applicable GAAP. Accounting Standards Codification ("ASC") 815, Derivatives and Hedging Activities, ("ASC 815") requires companies to bifurcate conversion options from their host instruments and account for them as free standing derivative financial instruments according to certain criteria. The criteria includes circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument. | |||
Conversion options that contain variable settlement features such as provisions to adjust the conversion price upon subsequent issuances of equity or equity linked securities at exercise prices more favorable than that featured in the hybrid contract generally result in their bifurcation from the host instrument. | |||
The Company accounts for convertible instruments, when the Company has determined that the embedded conversion options should not be bifurcated from their host instruments, in accordance with ASC 470-20, Debt with Conversion and Other Options ("ASC 470-20"). Under ASC 470-20 the Company records, when necessary, discounts to convertible notes for the intrinsic value of conversion options embedded in debt instruments based upon the differences between the fair value of the underlying common stock at the commitment date of the note transaction and the effective conversion price embedded in the note. The Company accounts for convertible instruments (when the Company has determined that the embedded conversion options should be bifurcated from their host instruments) in accordance with ASC 815. Under ASC 815, a portion of the proceeds received upon the issuance of the hybrid contract are allocated to the fair value of the derivative. The derivative is subsequently marked to market at each reporting date based on current fair value, with the changes in fair value reported in results of operations. | |||
The Company also follows ASC 480-10, Distinguishing Liabilities from Equity ("ASC 480-10") in its evaluation of the accounting for a hybrid instrument. A financial instrument that embodies an unconditional obligation, or a financial instrument other than an outstanding share that embodies a conditional obligation, that the issuer must or may settle by issuing a variable number of its equity shares shall be classified as a liability (or an asset in some circumstances) if, at inception, the monetary value of the obligation is based solely or predominantly on any one of the following: (a) a fixed monetary amount known at inception (for example, a payable settleable with a variable number of the issuer's equity shares); (b) variations in something other than the fair value of the issuer's equity shares (for example, a financial instrument indexed to the Standard and Poor's S&P 500 Index and settleable with a variable number of the issuer's equity shares); or (c) variations inversely related to changes in the fair value of the issuer's equity shares (for example, a written put option that could be net share settled). Hybrid instruments meeting these criteria are not further evaluated for any embedded derivatives, and are carried as a liability at fair value at each balance sheet date with remeasurements reported in interest expense in the accompanying consolidated statements of operations. | |||
Warrants Issued in Connection with Financings | |||
The Company generally accounts for warrants issued in connection with debt and equity financings as a component of equity, unless the warrants include a conditional obligation to issue a variable number of shares or there is a deemed possibility that the Company may need to settle the warrants in cash. For warrants issued with a conditional obligation to issue a variable number of shares or the deemed possibility of a cash settlement, the Company records the fair value of the warrants as a liability at each balance sheet date and records changes in fair value in other income (expense) in the accompanying consolidated statements of operations. | |||
Fair Value of Financial Instruments | |||
ASC 820, Fair Value Measurements ("ASC 820") clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. | |||
ASC 820 requires that the valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. ASC 820 establishes a three tier value hierarchy, which prioritizes inputs that may be used to measure fair value as follows: | |||
• | Level 1-Observable inputs that reflect quoted prices for identical assets or liabilities in active markets. | ||
• | Level 2-Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | ||
• | Level 3-Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. | ||
The carrying amounts of current assets, current liabilities and the non-current portion of customer advances and deferred revenues approximate their fair values because of the relatively short periods until they mature or are required to be settled. The fair values of the notes payable also approximate their fair values because of the relatively short periods until they mature. A majority of the notes are payable in 2014 and 2015. The fair value of convertible debt is based on its settlement value "as if" conversion occurred on the reporting date, and stock options and preferred stock warrant liabilities are estimated using the Black-Scholes option pricing model, all as more fully discussed in their respective footnotes. | |||
Deferred Rent | |||
Deferred rent consists of the difference between cash payments and the recognition of rent expense on a straight-line basis over the life of the lease. | |||
Revenue and Cost of Revenue Recognition | |||
When collaboration, other research arrangements and product sales include multiple-element revenue arrangements, the Company accounts for these transactions by identifying the elements, or deliverables, included in the arrangement and determining which deliverables are separable for accounting purposes. The Company considers delivered items to be a separate unit of accounting if the delivered item(s) have stand-alone value to the customer and delivery or performance of the undelivered item is considered probable and substantially in the control of the vendor. | |||
The Company recognizes revenue when the four basic criteria of revenue recognition are met: | |||
• | Persuasive evidence of an arrangement exists. Customer contracts and purchase orders are generally used to determine the existence of an arrangement. | ||
• | The transfer of technology or products has been completed or services have been rendered. Customer acceptance, when applicable, is used to verify delivery. | ||
• | The sales price is fixed or determinable. The Company assesses whether the cost is fixed or determinable based on the payment terms associated with the transaction and whether the sales price is subject to refund or adjustment. | ||
• | Collectability is reasonably assured. The Company assesses collectability based primarily on the creditworthiness of the customer as determined by credit checks and analysis as well as the customer's payment history. | ||
Beginning in 2012, with the commercialization of the Ekso, the Company began to recognize revenue from the sales of the Ekso and related services. | |||
Medical Device Revenue and Cost of Revenue Recognition | |||
The Company builds medical devices called the Ekso for sale and capitalizes into inventory materials, direct and indirect labor and overhead in connection with manufacture and assembly of these units. | |||
In a typical Ekso sales arrangement, the Company is obligated to deliver to the customer the Ekso unit and related software (the software is essential to the unit's functionality), post-sale training, technical support and maintenance. Because of the uniqueness of the Ekso unit and its use, none of these deliverables has standalone value to the customer. Accordingly, once a sales arrangement with a fixed or determinable price and reasonably assured payment is in place, the entire arrangement is accounted for as a single unit of accounting. The total sales price for the delivered and undelivered elements are deferred and amortized to revenue beginning at the completion of training on a straight line basis over the maintenance period, usually three years, which is the last delivered item. | |||
Because of the limited guidance about how to account for costs associated with a delivered item that cannot be separated from the undelivered items, the accounting for such costs must be based on the conceptual framework and analogies to the limited guidance that does exists. Accordingly, the Company accounts for the costs of the delivered items following, by analogy, the guidance in Accounting Standards Codification ("ASC") 310-20, Nonrefundable Fees and Other Costs ("ASC 310-20"). Under this guidance, upon completion of training, the costs capitalized into inventory including direct material, direct and indirect labor, as well as overhead costs are deferred and then amortized to costs of sales on the same basis as deferred revenue. The Company's inclusion of indirect labor and overhead costs are included in inventory because, under the conceptual framework, they add value to the Ekso unit and are otherwise appropriate inventory costs. Since the Company has an enforceable contract for the remaining deliverables and the entire arrangement is expected to generate positive margins, realization of the capitalized costs is probable and, as such, deferring and amortizing them on the same basis as deferred revenue is appropriate. | |||
At the time of shipment to the customer, the related inventory is reclassified to deferred cost of revenue where it is amortized to cost of revenue over the same period that revenue is recognized. All costs incurred subsequent to the date of shipment are expensed as incurred. The cost of medical device revenue includes expenses associated with the manufacture and delivery of devices including materials, payroll, benefits, subcontractor expenses, depreciation of manufacturing equipment, excess and obsolete inventory costs, and shipping charges. | |||
Engineering Services Revenue and Cost of Revenue | |||
The Company enters into technology license agreements that typically provide for annual minimum access fees. When these annual minimum payments have separate stand-alone values, the Company recognizes revenue when the technology is transferred or accessed, provided that the technology transferred or accessed is not dependent on the outcome of continuing research and/or other development efforts. | |||
Collaborative arrangements typically consist of cost reimbursements for specific engineering and development spending, and future product royalty payments. Cost reimbursements for engineering and development spending are recognized as the related project labor hours are incurred in relation to all labor hours and when collectability is reasonably assured. Amounts received in advance are recorded as deferred revenue until the technology is transferred, services are rendered, or milestones are reached. Product royalty payments are recorded when earned under the arrangement. | |||
Government grants, which support the Company's research efforts in specific projects, generally provide for reimbursement of approved costs as defined in the notices of grant awards. Grant revenue is recognized as the associated project labor hours are incurred in relation to total labor hours. There are some grants, like the National Science Foundation grants, which the Company draws upon and spends based on budgets preapproved by the grantor. | |||
The cost of engineering services revenue includes payroll and benefits, subcontractor expenses and materials. All costs related to engineering services are expensed as incurred and reported as cost of revenue. | |||
Research and Development | |||
Research and development costs consist of costs incurred for the Company's own internal research and development activities. These costs primarily include salaries and other personnel-related expenses, contractor fees, facility costs, supplies, and depreciation of equipment associated with the design and development of new products prior to the establishment of their technological feasibility. Such costs are expensed as incurred. | |||
Advertising and Marketing Costs | |||
Advertising and marketing costs are charged to sales and marketing expense as incurred. Advertising and marketing expense was $113,223 and $518,747 for the years ended December 31, 2013 and 2012, respectively. | |||
Shipping Costs | |||
Amounts billed to customers for shipping costs are recognized as revenue. Costs incurred to ship devices from the Company's manufacturing facility are recorded in cost of revenues. Shipping revenues and costs were immaterial for all periods presented. | |||
Income Taxes | |||
The Company accounts for income taxes using the asset and liability method. Under this method, income tax expense or benefit is recognized for the amount of taxes payable or refundable for the current year and for deferred tax liabilities and assets for the future tax consequences of events that have been recognized in the Company's consolidated financial statements or tax returns. The Company accounts for any income tax contingencies in accordance with accounting guidance for income taxes. The measurement of current and deferred tax assets and liabilities is based on provisions of currently enacted tax laws. The effects of any future changes in tax laws or rates have not been considered. | |||
For the preparation of the Company's consolidated financial statements included herein, the Company estimates its income taxes and tax contingencies in each of the tax jurisdictions in which it operates prior to the completion and filing of its tax returns. This process involves estimating actual current tax expense together with assessing temporary differences resulting from differing treatment of items, such as deferred revenue, for tax and accounting purposes. These differences result in net deferred tax assets and liabilities. The Company must then assess the likelihood that the deferred tax assets will be realizable, and to the extent they believe that realizability is not likely, the Company must establish a valuation allowance. In assessing the need for any additional valuation allowance, the Company considers all the evidence available to it, both positive and negative, including historical levels of income, legislative developments, expectations and risks associated with estimates of future taxable income, and ongoing prudent and feasible tax planning strategies. | |||
Stock-based Compensation | |||
The Company measures stock-based compensation expense for all stock-based awards made to employees and directors based on the estimated fair value of the award on the date of grant using the Black-Scholes option pricing model and recognizes the fair value less estimated forfeitures, on a straight-line basis over the requisite service periods of the awards. Stock-based awards made to non-employees are measured and recognized based on the estimated fair value on the vesting date and are remeasured at each reporting period. | |||
The Company's determination of the fair value of stock-based awards on the date of grant using the Black-Scholes option pricing model is affected by the Company's stock price as well as assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to the Company's expected stock price volatility over the term of the awards, and actual and projected employee stock option exercise behaviors. Because there is insufficient information available to estimate the expected term of the stock-based awards, we adopted the simplified method of estimating the expected term pursuant to SEC Staff Accounting Bulletin No. 110. On this basis, we estimated the expected term of options granted by taking the average of the vesting term and the contractual term of the option. | |||
The Company has, from time to time, modified the terms of its stock options to employees. The Company accounts for the incremental increase in the fair value over the original award on the date of the modification as an expense for vested awards or over the remaining service (vesting) period for unvested awards. The incremental compensation cost is the excess of the fair value based measure of the modified award on the date of modification over the fair value of the original award immediately before the modification. | |||
Comprehensive Income/(Loss) | |||
ASC 220, Comprehensive Income requires that an entity's change in equity (or net assets) be reported if it arises from transactions and other events having non-owner sources. Comprehensive loss for the periods presented was comprised solely of the Company's consolidated net loss. The comprehensive loss for the years ended December 31, 2013 and 2012 was $11,887,374 and $15,041,958, respectively. There were no other changes in equity that were excluded from the Company's consolidated net loss for all periods presented. | |||
Recently Adopted Accounting Standards | |||
In February 2013, the Financial Accounting Standards Board (''FASB'') issued Accounting Standards Update ("ASU") 2013-02, Comprehensive Income (ASC Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income. The new ASU requires entities to disclose in a single location (either on the face of the financial statement that reports net income or in the notes) the effects of reclassifications out of accumulated other comprehensive income (''AOCI''). For items reclassified out of AOCI and into net income in their entirety, entities must disclose the effect of the reclassification on each affected net income item. For AOCI reclassification items that are not reclassified in their entirety into net income, entities must provide a cross-reference to other required U.S. GAAP disclosures. There is no change in the requirement to present the components of net income and other comprehensive income in either a single continuous statement or two separate consecutive statements. The ASU does not change the items currently reported in other comprehensive income. | |||
For public entities, the new disclosure requirements are effective for annual reporting periods beginning after December 15, 2012, and interim periods within those years (i.e., the second quarter of 2013 for entities with calendar year-ends). For nonpublic entities, ASU 2013-02 is effective prospectively for reporting periods beginning after December 15, 2013. The ASU applies prospectively, and early adoption is permitted. The adoption of this ASU did not have a material impact on the Company's consolidated financial statements as of and for the years ended December 31, 2013 and 2012. | |||
Fair_Value_Measurements
Fair Value Measurements | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Fair Value Measurements [Abstract] | ' | ||||||||||||||||
Fair Value Measurements | ' | ||||||||||||||||
3. Fair Value Measurements | |||||||||||||||||
The Company records its consolidated financial assets and liabilities at fair value. The accounting standard for fair value provides a framework for measuring fair value, and defines fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. The accounting standard establishes a three-tier hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: | |||||||||||||||||
• | Level 1-Quoted prices in active markets for identical assets or liabilities. The Company considers a market to be active when transactions for the asset occur with sufficient frequency and volume to provide pricing information on an ongoing basis. | ||||||||||||||||
• | Level 2-Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | ||||||||||||||||
• | Level 3-Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The valuation of Level 3 investments requires the use of significant management judgments or estimation. | ||||||||||||||||
The Company's fair value hierarchies for its financial assets and liabilities which require fair value measurement on a recurring basis are as follows: | |||||||||||||||||
Total | Quoted Prices in | Significant Other | Significant | ||||||||||||||
Active Markets for | Observable Inputs | Unobservable | |||||||||||||||
Identical Items | Level 2 | Inputs | |||||||||||||||
Level 1 | Level 3 | ||||||||||||||||
31-Dec-13 | |||||||||||||||||
Liabilities: | |||||||||||||||||
Warrant liability | $ | 377,747 | $ | - | $ | - | $ | 377,747 | |||||||||
Convertible debt | 5,062,417 | - | - | 5,062,417 | |||||||||||||
Total liabilities measured at estimated fair value | $ | 5,440,164 | $ | - | $ | - | $ | 5,440,164 | |||||||||
December 31, 2012 | |||||||||||||||||
Liabilities: | |||||||||||||||||
Warrant liability | $ | 563,822 | $ | - | $ | - | $ | 563,822 | |||||||||
Convertible debt | 3,528,313 | - | - | 3,528,313 | |||||||||||||
Total liabilities measured at estimated fair value | $ | 4,092,135 | $ | - | $ | - | $ | 4,092,135 | |||||||||
The valuation of the convertible debt and the warrant liability are more fully discussed in Note 9, Convertible Debt, and Note 13, Capital Stock. | |||||||||||||||||
During the years ended December 31, 2013 and 2012, there were no transfers to or from Level 3. The Company had no assets measured on a recurring basis at fair value at December 31, 2013 and 2012. | |||||||||||||||||
The changes in the value of the Level 3 liabilities are summarized below: | |||||||||||||||||
Convertible Notes | Warrant | ||||||||||||||||
Payable | Liability | ||||||||||||||||
Balance at January 1, 2012 | $ | - | $ | 168,338 | |||||||||||||
Issuance of warrants at fair value | - | 412,610 | |||||||||||||||
Issuance of 2012 Series B convertible bridge notes at fair value | 3,354,021 | - | |||||||||||||||
Mark to market, included in other expense, net | - | (17,126 | ) | ||||||||||||||
Mark to market, included in interest expense | 174,292 | - | |||||||||||||||
Balance at December 31, 2012 | 3,528,313 | 563,822 | |||||||||||||||
Issuance of 2012 Series B convertible bridge notes at fair value | 2,162,564 | - | |||||||||||||||
Issuance of 2013 Series B convertible bridge notes at fair value | 5,062,417 | - | |||||||||||||||
Issuance of right to receive common stock warrants at fair value included in other expense, net | - | 95,760 | |||||||||||||||
Mark to market, included in other expense, net | - | (281,835 | ) | ||||||||||||||
Mark to market, included in interest expense | 799,194 | - | |||||||||||||||
Converted to Series B convertible preferred stock | (6,490,071 | ) | - | ||||||||||||||
Balance at December 31, 2013 | $ | 5,062,417 | $ | 377,747 | |||||||||||||
Inventories
Inventories | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Inventories [Abstract] | ' | ||||||||
Inventories | ' | ||||||||
4. Inventories | |||||||||
Inventories, net consist of the following: | |||||||||
December 31, | |||||||||
2013 | 2012 | ||||||||
Raw materials | $ | 501,187 | $ | 346,634 | |||||
Work in process | 235,767 | 288,163 | |||||||
736,954 | 634,797 | ||||||||
Less inventory reserve | (11,858 | ) | (19,432 | ) | |||||
Inventory, net | $ | 725,096 | $ | 615,365 | |||||
Property_and_Equipment_net
Property and Equipment, net | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
Property and Equipment, net [Abstract] | ' | ||||||||||
Property and Equipment, net | ' | ||||||||||
5. Property and Equipment, net | |||||||||||
Property and equipment, net, consists of the following: | |||||||||||
Estimated | December 31, | ||||||||||
Life | 2013 | 2012 | |||||||||
Machinery and equipment | 3-5 years | $ | 1,137,240 | $ | 790,165 | ||||||
Computers and peripherals | 5 years | 327,152 | 326,443 | ||||||||
Computer software | 3-5 years | 78,351 | 78,351 | ||||||||
Leasehold improvement | 5-10 years | 606,483 | 598,740 | ||||||||
Tools, molds, dies and jigs | 5 years | 36,932 | 36,932 | ||||||||
Furniture and office equipment | 3-7 years | 251,019 | 251,019 | ||||||||
Other | 5 years | 23,079 | 23,079 | ||||||||
2,460,256 | 2,104,729 | ||||||||||
Accumulated depreciation and amortization | (884,970 | ) | (439,538 | ) | |||||||
Property and equipment, net | $ | 1,575,286 | $ | 1,665,191 | |||||||
Depreciation and amortization expense totaled $468,906 and $342,078 in 2013 and 2012, respectively. | |||||||||||
Customer_Advances_and_Deferred
Customer Advances and Deferred Revenues | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Customer Advances and Deferred Revenues [Abstract] | ' | ||||||||
Customer Advances and Deferred Revenues | ' | ||||||||
6. Customer Advances and Deferred Revenues | |||||||||
In connection with its research services, the Company often receives cash payments before its earnings process is complete. In these instances, the Company records the payments as customer advances until the earnings process or milestone is achieved. | |||||||||
As described in its revenue recognition policy for EksoÔ unit sales, revenues are deferred and recognized over the expected maintenance period. Accordingly, at the time of shipment the amount billed is recorded as deferred revenue. Also, at the time of shipment to the customer, the related inventory is reclassified to deferred costs of revenue where it is amortized to cost of revenue over the same period as the related revenue. | |||||||||
Customer advances, deferred revenues, and deferred unit costs consist of the following: | |||||||||
December 31, | |||||||||
2013 | 2012 | ||||||||
Customer advances and deposits | $ | 443,436 | $ | 329,006 | |||||
Deferred Ekso unit revenues | 3,462,980 | 2,928,411 | |||||||
Deferred service and software revenues | 721,921 | 207,296 | |||||||
Customer advances and deferred revenues | 4,628,337 | 3,464,713 | |||||||
Less current portion | (2,419,226 | ) | (1,566,153 | ) | |||||
Customer advances and deferred revenues, non-current | $ | 2,209,111 | $ | 1,898,560 | |||||
Deferred Ekso unit costs | $ | 1,571,897 | $ | 1,130,246 | |||||
Less current portion | (768,599 | ) | (436,483 | ) | |||||
Deferred cost of revenue, non-current | $ | 803,298 | $ | 693,763 | |||||
Accrued_Liabilities
Accrued Liabilities | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Accrued Liabilities [Abstract] | ' | ||||||||
Accrued Liabilities | ' | ||||||||
7. Accrued Liabilities | |||||||||
Accrued liabilities consist of the following: | |||||||||
December 31, | |||||||||
2013 | 2012 | ||||||||
Salaries, benefits and related expenses | $ | 657,628 | $ | 771,137 | |||||
Professional fees | 421,966 | 114,676 | |||||||
Warranty expense | 288,110 | - | |||||||
Taxes | 62,283 | 35,810 | |||||||
Other | 812 | 75,853 | |||||||
Total | $ | 1,430,799 | $ | 997,476 | |||||
Senior_Notes_Payable
Senior Notes Payable | 12 Months Ended |
Dec. 31, 2013 | |
Senior Notes Payable [Abstract] | ' |
Senior Notes Payable | ' |
8. Senior Notes Payable | |
Principle and Interest | |
On April 27, 2011, the Company entered into a senior note payable agreement with Venture Lending & Leasing VI, Inc. (the "Lender"). The initial loan commitment of $1,500,000 was funded in two tranches: $1,000,000 in April 2011 and $500,000 in October 2011. In May 2012, the Lender funded an additional $3,500,000 under an amendment to the 2011 agreement. Collectively, the $5,000,000 funded is referred to as the "Senior Note Payable". | |
The Senior Note Payable was interest-only for the first 6 months, after which it converted into a fully-amortizing 30-month term note. During the interest only period, interest on the Senior Note Payable was fixed at 13% and during the repayment period interest was charged at the prime rate plus 6.25%, subject to a minimum rate of 9.5%. The Senior Note Payable was secured by substantially all of the Company's assets, including accounts receivable, inventories, property and equipment, and intangible assets, including intellectual property. | |
As of December 31, 2013 and 2012, the outstanding principal of the loan amounted to $2,552,632 and $4,341,862, respectively, and the Company recorded interest expense of $447,570 and $379,312, respectively, for the years then ended. | |
Debt Covenants | |
The Senior Note Payable had various covenants that, among other things, limited the Company's ability to incur debts and liens and to make asset sales and dividend payments. In July 2013, the Company defaulted on the Senior Note Payable by failing to make a required payment when due. In November 2013, the Lender waived the default. In return for the waiver, the Lender required the Company to cure the payment default using proceeds from the November 2013 Bridge Note financing which is more fully described in Note 9, Convertible Debt. Additionally, the Company agreed to cause the surviving parent company in the Merger (see Note 18, Subsequent Events, Merger with Ekso Bionics Holdings, Inc.) to subsequently issue to the Lender warrants to purchase 225,000 shares of the surviving parent company's common stock at an exercise price of $1.00 per share. The fair value of the Lender's right to receive warrants was $95,760 based on the Black-Scholes option pricing model and was recorded as a warrant liability and reflected in other expense, net in the consolidated statement of operations. | |
As of December 31, 2013, the Company was in compliance with all of the Senior Note Payable's covenants. | |
Warrants | |
Under the terms of the 2011 and 2012 agreements, the Lender received warrants to purchase shares of the Company's preferred stock. Under the 2011 agreement, the Lender received warrants to purchase 128,570 shares of the Company's Series A convertible preferred stock. The 2011 warrants had an exercise price of $1.75 per share and were to expire on October 31, 2021. The fair value of the 2011 warrants at the issuance date was estimated to be $167,256 using the Black-Scholes option-pricing model. | |
In connection with the 2012 amendment, the Lender received additional warrants to purchase shares of Series B convertible preferred stock. The terms of the 2012 warrants varied depending on which of three conversion options the Lender chose. Since the funding date, the Lender chose to receive 257,829 shares of the Company's Series B convertible preferred stock at an exercise price of $2.10 per share and warrants to purchase 19,337 of the Company's common stock at an exercise price of $2.10 per share. The warrants expire on June 1, 2022. The fair value of the 2012 warrants on the issuance date was determined to be $355,116 using probability weighted models. | |
The fair value of the 2013 and 2012 warrants was recorded as a debt discount and is being amortized to expense over the term of the loan using the interest method. The accounting for the warrants is more fully discussed in Note 13, Capital Stock. | |
Repayment of Senior Notes Payable Subsequent to December 31, 2013 | |
Subsequent to December 31, 2013, upon the closing of the Merger and the private placement financing discussed in Note 18, Subsequent Events, Merger with Ekso Bionics Holdings, Inc., the Senior Notes Payable were settled with proceeds from the Merger, and the warrants to purchase preferred stock issued to the Lender were exchanged for common stock; the common stock warrants remain outstanding. | |
Convertible_Debt
Convertible Debt | 12 Months Ended |
Dec. 31, 2013 | |
Convertible Debt [Abstract] | ' |
Convertible Debt | ' |
9. Convertible Debt | |
2012 Series B Convertible Bridge Notes | |
In November 2012, the Company entered into two convertible bridge note agreements pursuant to which the Company issued convertible bridge notes in the aggregate original principal amount of $3,311,546 (the "2012 Tranche 1 Bridge Notes") in anticipation of closing a Series B convertible preferred stock financing in early 2013. In January through April 2013, the Company issued additional convertible bridge notes in the aggregate original principal amount of $2,000,000 (the "2012 Tranche 2 Bridge Notes") (collectively, the "2012 Bridge Notes"). The 2012 Tranche 1 Bridge Notes carried interest at a rate of 5% per annum with a maturity date of November 12, 2013. The 2012 Tranche 2 Bridge Notes had identical terms to the 2012 Tranche 1 Bridge Notes except that the 2012 Tranche 2 Bridge Notes accrued interest at 10% per annum instead of 5% per annum. In April 2013, the Company modified the 2012 Tranche 1 Bridge Notes retroactively increasing the interest rate to 10%. | |
The terms of conversion of the 2012 Bridge Notes provided for issuance of a variable number of shares and warrants which could increase the amount of the obligation depending upon the timing of the Series B preferred stock offering. | |
The Company determined that the 2012 Bridge Notes should be recorded at fair value at inception and remeasured at each subsequent reporting period through conversion since the terms of the agreements provided that the principal and interest would be converted into a variable number of Series B preferred stock. Fair value was determined by calculating the settlement value of the debt "as if" converted at the end of each reporting period. At December 31, 2012, the fair value of the 2012 Bridge Notes was determined to be $3,528,313 based on a conversion discount of 5% comprised of $3,311,546 of principle, $42,475 of accrued interest and $174,292 of unrealized appreciation. | |
On May 20, 2013, the fair value of the 2012 Bridge Notes was determined to be $6,490,071. In accordance with the terms of the 2012 Bridge Note agreements, the fair value of the 2012 Bridge Notes was converted into 3,090,524 shares of Series B convertible preferred stock with detachable warrants for the purchase of 388,435 shares of common stock. | |
The Company determined that the common stock warrants issued upon conversion of the Series B Bridge Notes were more closely related to equity than debt due to their conversion into common stock and lack of debt-like features and, accordingly, their fair value of $136,380 as of May 20, 2013 based on the Black-Scholes option pricing model was reallocated to additional paid-in capital. | |
2013 Series B Convertible Bridge Notes | |
In November 2013, in anticipation of the Merger and related financing completed in January and February 2014, the Company completed a private placement to accredited investors of $5,000,000 of its senior subordinated secured convertible notes (the "2013 Bridge Notes"). The 2013 Bridge Notes bore interest at 10% per annum and were payable on July 15, 2014, subject to earlier conversion as described below. Interest on the 2013 Bridge Notes was to be payable at maturity; provided that upon conversion of the 2013 Bridge Notes as described below, accrued interest was forgiven. | |
The 2013 Bridge Notes were secured by a second priority security interest on all of the assets of the Company and its subsidiary, subject to certain limited exceptions. This security interest terminated upon conversion of the 2013 Bridge Notes in connection with the Merger and related private placement financing. | |
Similar to the accounting for the 2012 Bridge Notes, the Company determined that the 2013 Bridge Notes should be recorded at fair value at inception and remeasured each subsequent reporting period through conversion since the terms of the agreements provided that the principal and interest would be converted into a variable number of Series B preferred stock. Fair value was determined by calculating the settlement value of the debt "as if" converted at the end of each reporting period. At December 31, 2013, the fair value of the 2013 Bridge Notes was determined to be $5,062,417. | |
Subsequent to December 31, 2013, upon the closing of the Merger and the private placement financing discussed in Note 18, Subsequent Events, Merger with Ekso Bionics Holdings, Inc., the outstanding principal amount of the Bridge Notes was converted into Units of Holdings at a conversion price of $1.00 per Unit. Also, the investors received an additional warrant to purchase a number of shares of common stock of Holdings equal to 50% of the number of shares of common stock of Holdings contained in the Units into which the Bridge Notes were converted (i.e. 2,500,000 shares in the aggregate), at an exercise price of $1.00 per share, for a term of three years (the "Bridge Warrants"). | |
Employee_Benefit_Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2013 | |
Employee Benefit Plan [Abstract] | ' |
Employee Benefit Plan | ' |
10. Employee Benefit Plan | |
The Company administers a 401(k) retirement plan (the "Plan") in which all employees are eligible to participate. Each eligible employee may elect to contribute to the Plan. During the years ended December 31, 2013 and 2012, the Company has made no matching contributions. | |
Operating_Lease
Operating Lease | 12 Months Ended | ||||
Dec. 31, 2013 | |||||
Operating Lease [Abstract] | ' | ||||
Operating Lease | ' | ||||
11. Operating Lease | |||||
On November 29, 2011, the Company entered into an operating lease agreement for its new headquarters and manufacturing facility in Richmond, California. The lease term commenced in March 2012 and expires in May 2017. The lease provides the Company with one option to renew for 5 additional years. Prior to moving to the Richmond location, the Company's operations were run from a leased facility in Berkeley, California that expired in June 2012. | |||||
Rent expense under the Company's operating leases was $339,197 and $388,945 for the years ended December 31, 2013 and 2012, respectively. | |||||
Future minimum annual lease payments under these leases are as follows as of December 31, 2013: | |||||
2014 | $ | 375,404 | |||
2015 | 375,404 | ||||
2016 | 375,405 | ||||
2017 | 156,419 | ||||
Total | $ | 1,282,632 | |||
Under the lease agreement, the landlord agreed to provide the Company a loan with interest at 7% in the amount of $80,055 to finance a portion of planned leasehold improvements. On March 28, 2012, the lease agreement was modified to increase the landlord financing by $119,945 for a total of $200,000. The terms of the amended loan agreement with the landlord require the Company to make monthly loan payments of $3,960 from June 1, 2012 to May 31, 2017. These loan payments are incremental to the minimum monthly rent payments. The balances included in notes payable current and long-term at December 31, 2013 and 2012 were $162,370 and $209,893, respectively. Payments of $47,523 are due in years 2014, 2015 and 2016 with a remainder of $19,801 due in 2017. | |||||
Related_Party_Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2013 | |
Related Party Transactions [Abstract] | ' |
Related Party Transactions | ' |
12. Related Party Transactions | |
The Regents of the University of California, Berkeley ("UCB" or "University") own 310,400 shares of common stock. The Company has license agreements and various collaboration agreements (see Note 16, Commitments and Contingencies) with UCB. Total payments made to UCB for the years ended December 31, 2013 and 2012 were $15,904 and $255,523, respectively. As of December 31, 2013 and 2012, amounts payable to UCB amounted to $458,755 and $295,462, respectively. | |
On June 24, 2011, the Company and Eythor Bender, the then Chief Executive Officer, entered into an agreement in which the Company loaned to Mr. Bender $49,000. On May 8, 2012, the Company and Mr. Bender, the then Chief Executive Officer, entered into an agreement in which the Company loaned to Mr. Bender $20,000. On June 6, 2012, the Company and Mr. Bender, the then Chief Executive Officer, entered into an agreement in which the Company loaned to Mr. Bender $25,000. All of these loans were due within 12 months and had an interest rate of 5% per annum. Under the terms of an employment separation agreement dated November 28, 2012, the Company and Mr. Bender agreed to consolidate and extend the term of the outstanding notes receivable totaling $94,000. Interest will continue to accrue at 5% per annum. The note was due June 30, 2015. On January 15, 2014 Mr. Bender repaid his loan in full, including interest. | |
On November 29, 2011, the Company entered into a development agreement with a government entity which also owns 571,420 shares of the Company's Series A preferred stock as of December 31, 2013 and 2012, and 119,047 shares of the Company's Series A-2 preferred stock as of December 31, 2013 and 2012. As part of the agreement, the Company developed, fabricated and tested Alpha, Beta, and Pilot versions of a custom exoskeleton system. In exchange, the government entity agreed to make certain milestone payments to the Company over the 1.5 year term of the agreement. For the years ended December 31, 2013 and 2012, the Company recognized as revenue approximately $0 and $424,000, respectively, related to this project. Additionally, accounts receivable, including unbilled receivables representing earned milestone payments, amounted to $114,500 as of December 31, 2012. There were no amounts receivable related to this project in 2013. | |
Astrolink International LLC ("Astrolink"), an affiliate of Lockheed (a significant customer), owned 857,140 shares of the Company's Series A convertible preferred stock as of December 31, 2013 and 2012. As of December 31, 2013, Astrolink also owned 758,604 shares of the Company's Series B convertible preferred stock. For the years ended December 31, 2013 and 2012, the Company recognized as revenue approximately $337,796 and $568,002, respectively, related to this project. | |
Capital_Stock
Capital Stock | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||
Capital Stock [Abstract] | ' | ||||||||||||||||||||||||
Capital Stock | ' | ||||||||||||||||||||||||
13. Capital Stock | |||||||||||||||||||||||||
Common stock | |||||||||||||||||||||||||
Certain shares of outstanding common stock are subject to the terms of the common stock purchase agreements. According to the terms of the agreements, in the event that a holder of common stock ceases their relationship with the Company, the Company has the right to repurchase all or any shares at fair value. The repurchase option terminates in the event that the Company consummates a change of control transaction and involuntary termination, or involuntary termination, as defined. | |||||||||||||||||||||||||
Convertible Preferred stock | |||||||||||||||||||||||||
Issued and outstanding convertible preferred stock (without regard to the conversion ratio used in the Merger discussed in Note 18, Subsequent Events, Merger with Ekso Bionics Holdings, Inc.) consisted of the following at December 31, 2013: | |||||||||||||||||||||||||
Number of | |||||||||||||||||||||||||
Number of | Shares | Liquidation | Aggregate | ||||||||||||||||||||||
Shares | Issued and | Preference | Liquidation | ||||||||||||||||||||||
Series | Authorized | Outstanding | Per Share | Preference | |||||||||||||||||||||
A | 4,624,840 | 4,496,270 (1) | $ | 1.75 | $ | 7,868,473 | |||||||||||||||||||
A-2 | 4,527,010 | 4,335,414 | $ | 2.1 | $ | 9,104,369 | |||||||||||||||||||
B | 12,000,000 | 5,179,344 | $ | 2.1 | $ | 10,876,622 | |||||||||||||||||||
$ | 27,849,464 | ||||||||||||||||||||||||
-1 | Series A financing efforts commenced in December 2010 were completed in July 2011. The Company issued 4,496,270 of the 4,650,000 authorized shares of Series A convertible preferred stock in connection with this transaction. The total amount of equity raised amounted to $7.87 million. Of this amount $2.43 million was received in cash and $393,000 was completed through a conversion of debt during the year ended December 31, 2010 and the rest of the funds were raised during 2011. Lockheed, a key customer, participated in this round of financing by making an equity investment totaling $1.5 million. | ||||||||||||||||||||||||
The rights, privileges and restrictions of Series A, A-2 and B convertible preferred stock ("the Preferred Stock") were set forth in the Company's Amended and Restated Certificate of Incorporation. Voting and conversion rights are summarized below: | |||||||||||||||||||||||||
• | Voting rights - Holders are entitled to one vote for each share of common stock into which such share of Preferred Stock is convertible. | ||||||||||||||||||||||||
• | Conversion - Each share of the Preferred Stock is convertible, at the option of the holder, according to the conversion ratio obtained by dividing the Original Issue Price (described above) by the Conversion Price, which initially is the Original Issue Price, subject to adjustment for dilution. Each share of Series A, A-2, and B Preferred Stock is currently convertible into one share of common stock. The number of fully paid and nonassessable shares of common stock is determined by dividing the Original Issue Price by the Conversion Price. Each share of the Preferred Stock automatically converts into the number of shares of common stock into which such shares are convertible at the then effective conversion ratio upon: (1) the closing of a public offering of common stock with proceeds to the Company of at least $25,000,000 and in which the pre-money valuation of the Company is not less than $75,000,000 or (2) the date or time specified by vote, written consent or agreement of the holders of the majority of the then outstanding shares of convertible preferred stock, voting together as a class. | ||||||||||||||||||||||||
For financial accounting purposes, the Company determined that the convertible preferred stock does not meet the requirements under ASC 480-10-25 to be accounted for as a liability because the shares are not mandatorily redeemable, except in the case of a liquidation event in which case the holders are entitled to be paid out a liquidation preference, and the conversion ratio is based on a pre-determined number of shares rather than a variable number of shares. However, it was determined that a "deemed liquidation event" could occur that would be outside the control of the Company. In accordance with ASC 480-10-S99, the convertible preferred stock will be in the "mezzanine" section between liabilities and stockholders' deficit. | |||||||||||||||||||||||||
During the years ended December 31, 2013 and 2012, because the timing of any such liquidation event was uncertain, the Company elected not to adjust the carrying values of its preferred stock to their respective liquidation values. | |||||||||||||||||||||||||
Warrants | |||||||||||||||||||||||||
The Company issued warrants to lenders in connection with convertible debt and to a customer in connection with a service contract. The outstanding warrants (without regard to the conversion ratio used in the Merger discussed in Note 18, Subsequent Events, Merger with Ekso Bionics Holdings, Inc.) were as follows: | |||||||||||||||||||||||||
Number | Fair Value as of | ||||||||||||||||||||||||
Warrants to | of | Date of | Exercise | Expiration | 31-Dec | ||||||||||||||||||||
purchase shares of: | shares | issue | Price | Date | At Inception | 2013 | 2012 | ||||||||||||||||||
Series A, to lender | 128,570 | 4/29/11 | $ | 1.75 | 10/31/21 | $ | 167,256 | $ | 69,312 | $ | 151,738 | ||||||||||||||
Series B, to lender | 257,829 | 5/31/12 | $ | 2.1 | 6/1/22 | $ | 348,327 | 181,567 | 354,593 | ||||||||||||||||
Common stock, to lender | 19,337 | 5/31/12 | $ | 2.1 | 6/1/22 | $ | 6,789 | N/A | N/A | ||||||||||||||||
Series B to customer | 27,500 | 11/16/12 | $ | 0.01 | 11/16/19 | $ | 57,494 | 31,108 | 57,491 | ||||||||||||||||
Common stock, to investors in Series B | 388,435 | Various from 5/20/2013 to 8/29/2013 | $ | 2.1 | 10 years from issue | $ | 136,380 | N/A | N/A | ||||||||||||||||
281,987 | 563,822 | ||||||||||||||||||||||||
Obligation to issue warrant (see last paragraph) | 95,760 | - | |||||||||||||||||||||||
Total warrant liability | $ | 377,747 | $ | 563,822 | |||||||||||||||||||||
(Note: The fair value as of period end is not applicable (N/A) for the warrants on common stock because such instruments are carried in equity without revaluation to periodic fair value.) | |||||||||||||||||||||||||
The fair value of the warrants to purchase preferred stock issued to lenders was recorded as a liability at inception with a corresponding charge to discount on debt which is being amortized to interest expense as an adjustment to yield. The fair value of the warrants to purchase common stock issued to lenders was recorded in additional paid in capital at inception with a corresponding charge to discount on debt which is being amortized to interest expense as an adjustment to yield. The fair value of the warrant issued to the customer was recorded as a liability at inception with a corresponding reduction to the amount of revenue recognized under the service contract. The warrants classified as liabilities are marked to market at the end of each reporting period as an item of other income or loss in the accompanying consolidated statement of operations. The warrants to purchase common stock have no further accounting consequence after inception. | |||||||||||||||||||||||||
The warrants are exercisable during their term at the option of the holder, upon a liquidation event, or the consummation of an initial public offering by the Company, whichever is earlier. | |||||||||||||||||||||||||
The Company estimates the fair value of warrants using the Black-Scholes option pricing model with inputs for dividend yield, risk-free rate of return, expected life in years and volatility, as applicable, for each instrument at inception and then for each measurement date. Because the terms in the agreement for the warrants on the Series B preferred stock provided the Lender with three conversion options, the Company used a valuation technique with probability weighted inputs. | |||||||||||||||||||||||||
In addition to the warrant obligation discussed above and as discussed in Note 8, Senior Notes Payable, Debt Covenants, the Company agreed to cause the surviving parent company in the Merger (see Note 18, Subsequent Events, Merger with Ekso Bionics Holdings, Inc.) to subsequently issue to the Lender warrants to purchase 225,000 shares of the surviving parent company's Common Stock at an exercise price of $1.00 per share. The fair value of the warrant obligation of $95,760 based on the Black-Scholes option pricing model was recorded as a warrant liability. This warrant is marked to market at the end of each reporting period as an item of other income or loss in the accompanying consolidated statements of operations until conversion into common shares in January 2014. | |||||||||||||||||||||||||
Reverse Merger | |||||||||||||||||||||||||
Share amounts for common stock, convertible preferred stock, stock options and warrants of the Company included in the consolidated financial statements and notes thereto have not been adjusted to give effect to the conversion of the Company's stock, warrants and options in connection with the reverse merger transaction in January 2014 described in Note 18, Subsequent Events, except as set forth in Note 18. At the closing of the reverse merger transaction, each share of Ekso Bionics' common stock issued and outstanding immediately prior to the closing of the Merger was converted into 1.5238 shares of Common Stock of Holdings (as defined in Note 18), each share of Ekso Bionics' Series A preferred stock issued and outstanding immediately prior to the closing of the Merger was converted into 1.6290 shares of Holdings' Common Stock, and each share of Ekso Bionics' Series A-2 and Series B preferred stock issued and outstanding immediately prior to the closing of the Merger was converted into 1.9548 shares of Holdings' Common Stock. | |||||||||||||||||||||||||
Employee_Stock_Options
Employee Stock Options | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Employee Stock Options [Abstract] | ' | ||||||||||||
Employee Stock Options | ' | ||||||||||||
14. Employee Stock Options | |||||||||||||
Under the terms of the 2007 Equity Incentive Plan, which was adopted by the Board of Directors in November 2007, the Board of Directors may award stock, options or similar rights having either a fixed or variable price related to the fair market value of the shares and with an exercise or conversion privilege related to the passage of time, the occurrence of one or more events, or the satisfaction of performance criteria or other conditions, or any other security with the value derived from the value of the shares. Such awards include stock options, restricted stock, restricted stock units, stock appreciation rights and dividend equivalent rights. | |||||||||||||
The Board of Directors may grant nonstatutory stock options under the 2007 Equity Incentive Plan at a price of not less than 100% of the fair market value of the Company's common stock on the date the option is granted. Incentive stock options under the 2007 Equity Incentive Plan may be granted at a price of not less than 100% of the fair market value of the Company's common stock on the date the option is granted. Incentive stock options granted to employees who, on the date of grant, own stock representing more than 10% of the voting power of all of the Company's classes of stock are granted at an exercise price of not less than 110% of the fair market value of the Company's common stock. The maximum term of these incentive stock options, granted to employees who own stock possessing more than 10% of the voting power of all classes of the Company's stock, may not exceed five years. The maximum term of an incentive stock option granted to any other participant may not exceed ten years. The Board of Directors determines the term and exercise or purchase price of all other awards granted under the 2007 Equity Incentive Plan. The Board of Directors also determines the terms and conditions of awards, including the vesting schedule and any forfeiture provisions. Awards under the 2007 Equity Incentive Plan may vest upon the passage of time or upon the attainment of certain performance criteria established by the Board of Directors. | |||||||||||||
Unless terminated sooner, the 2007 Equity Incentive Plan will automatically terminate in 2017. The Board of Directors may at any time amend, suspend or terminate the Company's 2007 Equity Incentive Plan. | |||||||||||||
The following table summarizes stock option activity under the Company's stock option plan (without regard to the conversion ratio used in the Merger discussed in Note 18, Subsequent Events): | |||||||||||||
Shares | Number of | Weighted-Average | |||||||||||
Available | Options | Exercise | |||||||||||
For Grant | Outstanding | Price | |||||||||||
Balance at December 31, 2011 | 2,473,010 | 3,539,600 | $ | 0.357 | |||||||||
Options granted | (1,879,375 | ) | 1,879,375 | 0.792 | |||||||||
Options exercised | - | (156,624 | ) | 0.203 | |||||||||
Options repurchased | 8,122 | - | - | ||||||||||
Options cancelled | 958,679 | (958,679 | ) | 0.463 | |||||||||
Balance at December 31, 2012 | 1,560,436 | 4,303,672 | 0.524 | ||||||||||
Options granted | (1,794,782 | ) | 1,794,782 | 0.93 | |||||||||
Options exercised | - | (504,321 | ) | 0.127 | |||||||||
Options cancelled | 624,388 | (624,388 | ) | 0.718 | |||||||||
Balance at December 31, 2013 | 390,042 | 4,969,745 | $ | 0.686 | |||||||||
Options exercisable at December 31, 2013 totaled $2,540,220 with a weighted-average exercise price of $0.517 and a weighted average remaining contractual term of 8.03 years. | |||||||||||||
The fair value of options granted to employees during 2013 and 2012 was $835,896 and $898,963, respectively. | |||||||||||||
At December 31, 2013 and 2012, the total unamortized employee stock-based compensation expense amounted to $1,125,308 and $817,637 respectively, and is to be recognized over the stock options' remaining vesting term of approximately three years. | |||||||||||||
In 2012, the Board of Directors approved an extension to the post termination exercise period for 64,568 vested stock options held by former employees from three months to two years. Since this modification was made post termination, this modification was treated as a new award to nonemployees using the new term. The Company recognized $30,792 during the year ended December 31, 2012 as compensation expense. | |||||||||||||
In October 2013, the Board of Directors approved an extension to the post-termination exercise period for 233,735 vested stock options held by former employees from three months to two years. The Board of Directors also approved an extension to the post termination exercise period for 86,318 vested stock options held by former employees from three months to December 31, 2013. | |||||||||||||
The Company from time to time grants options to purchase common stock to non-employees for advisory and consulting services. Pursuant to ASC 505-50, Equity-Based Payments to Non-Employees, the Company periodically remeasures the fair value of these stock options using the Black-Scholes option pricing model and recognizes expense ratably over the vesting period of each stock option award. Non-employee stock compensation expense was $32,590 and $46,470 for the years ended December 31, 2013 and 2012, respectively, and is included in the consolidated statements of operation in the cost center of the employee. | |||||||||||||
The following assumptions were used to determine the fair value of options granted to employees: | |||||||||||||
- | The expected dividend yield is zero, as the Company has not paid any dividends and does not anticipate paying dividends in the near future. | ||||||||||||
- | The risk-free interest rate for periods related to the expected life of the options is based on the U.S. Treasury yield curve in effect at the time of grant. | ||||||||||||
- | The expected volatility is based on historical volatilities of peer group public companies' stock over the expected term of the option. | ||||||||||||
- | The expected term of options represents the period that the Company's stock-based compensation awards are expected to be outstanding. The Company has used the "simplified" method provided in Securities and Exchange Commission's Staff Accounting Bulletin No. 110 to estimate the expected term which takes into consideration the grant's contractual life and vesting period, because the Company lacks relevant historical data due to its limited historical experience. | ||||||||||||
- | The Company also estimates the number of options that are expected to be forfeited. Because of the lack of sufficient history, commencing in 2011, the Company used the average forfeiture rate of comparable peer companies which management determined to be 10%. Management estimates that such average rate represents a reasonable approximation of the currently anticipated rate of forfeiture for granted and outstanding stock options that have not vested. | ||||||||||||
The assumptions used in the Black-Scholes option pricing model in calculating the fair value of stock options granted to employees are as follows: | |||||||||||||
Years ended December 31, | |||||||||||||
2013 | 2012 | ||||||||||||
Dividend yield | - | - | |||||||||||
Risk-free interest rate | 0.83% - 1.93% | 1.20%-2.49% | |||||||||||
Expected term (in years) | 6-May | 6 | |||||||||||
Volatility | 65%-70% | 65% | |||||||||||
The assumptions used in the Black-Scholes option pricing model in calculating the fair value of stock options granted to non-employees are as follows: | |||||||||||||
Years ended December 31, | |||||||||||||
2013 | 2012 | ||||||||||||
Dividend yield | - | - | |||||||||||
Risk-free interest rate | 0.83%-1.73% | 1.63% | |||||||||||
Expected term (in years) | 5 | 5 | |||||||||||
Volatility | 66%-71% | 67% | |||||||||||
Total stock-based compensation expense related to options granted to employees and non-employees was included in the consolidated statements of operations as follows: | |||||||||||||
December 31, | |||||||||||||
2013 | 2012 | ||||||||||||
General and administrative | $ | 197,072 | $ | 171,968 | |||||||||
Research and development | 82,608 | 69,609 | |||||||||||
Sales and marketing | 110,937 | 91,889 | |||||||||||
$ | 390,617 | $ | 333,466 | ||||||||||
Income_Taxes
Income Taxes | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Income Taxes [Abstract] | ' | ||||||||||||||||
Income Taxes | ' | ||||||||||||||||
15. Income Taxes | |||||||||||||||||
The Company had no current or deferred federal and state income tax expense or benefit for the years ended December 31, 2013 and 2012 because the Company generated net operating losses, and currently management does not believe it is more likely than not that the net operating losses will be realized. The Company's non-U.S. tax obligation is primarily for business activities conducted through the United Kingdom for which taxes included in other expense (net) for the years ended December 31, 2013 and 2012 were immaterial and accordingly, such amounts were excluded from the following tables. | |||||||||||||||||
At December 31, 2013 and 2012, the Company has provided a full valuation allowance against its net deferred tax assets as realization is dependent on future earnings, if any, the timing and amount which is uncertain. The valuation allowance for 2013 increased $4,805,742 from 2012. Significant components of the Company's deferred tax assets consist of the following: | |||||||||||||||||
December 31, | |||||||||||||||||
2013 | 2012 | ||||||||||||||||
Deferred tax assets: | |||||||||||||||||
Depreciation and other | $ | 1,032,972 | $ | 172,727 | |||||||||||||
Net operating loss carryforwards | 13,631,820 | 9,966,468 | |||||||||||||||
Unused R& D tax credits | 280,145 | - | |||||||||||||||
Less: Valuation allowance | (14,944,937 | ) | (10,139,195 | ) | |||||||||||||
Net deferred tax asset (liability) | $ | - | $ | - | |||||||||||||
At December 31, 2013, the Company had federal and state net operating loss tax carryforwards of approximately $34,300,000 and $29,200,000, respectively. These net operating loss carryforwards expire in various amounts starting in 2027 and 2017, respectively. In addition, the Company has unused research and development tax credit carryforwards which expire in various amounts beginning in the year 2031. The utilization of the federal net operating loss carryforwards and unused research and development tax credits will depend on the Company's ability to generate sufficient taxable income prior to the expiration of the carryforwards. | |||||||||||||||||
Utilization of the net operating loss and tax credit carry forwards may be subject to substantial annual limitations due to past and future ownership change provisions of Section 382 of the Internal Revenue Code and similar state provisions. The Company has not performed a change in ownership analysis since its formation and, accordingly, some or all of its net operating loss and tax carryforwards may not be available to offset future taxable income, if any. | |||||||||||||||||
The Company has evaluated its tax positions to consider whether it has any unrecognized tax benefits. As of December 31, 2013 and 2012, the Company has not recorded any amounts associated with unrecognized tax benefits. The Company recognizes interest and penalties related to uncertain tax positions in the provision for income taxes. As of December 31, 2013, the Company had no accrued interest related to uncertain tax positions. The Company is subject to U.S. federal and state income tax examinations by authorities for tax years 2007 through 2012 due to net operating losses that are being carried forward for tax purposes. No income tax returns are currently under examination by taxing authorities. | |||||||||||||||||
Taxes computed at the statutory federal income tax rate of 34% are reconciled to the provision for income taxes as follows for the years ended December 31: | |||||||||||||||||
2013 | 2012 | ||||||||||||||||
Amount | Percent of | Amount | Percent of | ||||||||||||||
Pretax | Pretax | ||||||||||||||||
Earnings | Earnings | ||||||||||||||||
United States federal tax statutory rate | $ | (4,077,982 | ) | 34 | % | $ | (4,947,324 | ) | 34 | % | |||||||
State taxes (net of deferred benefit) | (698,354 | ) | 5.8 | % | (834,558 | ) | 5.7 | % | |||||||||
Non-U.S. taxes | 16,863 | (0.1 | )% | - | - | % | |||||||||||
Non-deductible expenses | 430,631 | (3.6 | )% | 44,883 | (0.3 | )% | |||||||||||
Tax credits | (280,145 | ) | 2.3 | % | - | - | % | ||||||||||
Other, net | (196,756 | ) | 1.6 | % | 3,153 | - | % | ||||||||||
Change in valuation allowance | 4,805,742 | (40.1 | )% | 5,733,844 | (39.4 | )% | |||||||||||
Provision for income taxes | $ | - | - | % | $ | - | - | % | |||||||||
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2013 | |
Commitments and Contingencies [Abstract] | ' |
Commitments and Contingencies | ' |
16. Commitments and Contingencies | |
Contingencies | |
In the normal course of business, the Company is subject to various legal matters. In the opinion of management, the resolution of such matters will not have a material adverse effect on the Company's consolidated financial position, results of operations, or cash flows as of and for the years ended December 31, 2013 and 2012. | |
Material Contracts | |
The Company enters into various license, research collaboration and development agreements which provide for payments to the Company for government grants, fees, cost reimbursements typically with a markup, technology transfer and license fees, and royalty payments on sales. | |
The Company has two license agreements to maintain exclusive rights to patents. The Company is also required to pay 1% of net sales of products sold to entities other than the U.S. government. In the event of a sublicense, the Company will owe 21% of license fees and must pass through 1% of the sub-licensee's net sales of products sold to entities other than the U.S. government. | |
The agreements also stipulate minimum annual royalties of $10,000 for 2012, $20,000 for 2013, $40,000 for 2014 and $50,000 for subsequent years. | |
Segment_Disclosures
Segment Disclosures | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Segment Disclosures [Abstract] | ' | ||||||||||||
Segment Disclosures | ' | ||||||||||||
17. Segment Disclosures | |||||||||||||
The Company has two reportable segments, Engineering Services and Medical. Engineering Services generates revenue principally from collaborative research and development service arrangements, technology license agreements, and government grants where it used its robotics domain knowledge in bionic exoskeletons to bid on and procure contracts and grants from entities such as such as the National Science Foundation and the Defense Advanced Research Projects Agency. The Medical segment designs, engineers, and manufactures exoskeletons for applications in the medical and military markets. | |||||||||||||
The Company evaluates performance and allocates resources based on segment gross profit margin. The reportable segments are each managed separately because they serve distinct markets, and one segment provides a service and the other manufactures and distributes a unique product. The Company does not consider net assets as a segment measure and, accordingly, assets are not allocated. | |||||||||||||
Segment reporting information is as follows: | |||||||||||||
Engineering | Medical | ||||||||||||
Services | Devices | Total | |||||||||||
Year ended December 31, 2013 | |||||||||||||
Revenue | $ | 1,690,235 | $ | 1,611,709 | $ | 3,301,944 | |||||||
Cost of revenue | 1,253,942 | 1,460,692 | 2,714,634 | ||||||||||
Gross profit | $ | 436,293 | $ | 151,017 | $ | 587,310 | |||||||
Year ended December 31, 2012 | |||||||||||||
Revenue | $ | 2,140,355 | $ | 566,222 | $ | 2,706,577 | |||||||
Cost of revenue | 1,782,848 | 553,429 | 2,336,277 | ||||||||||
Gross profit | $ | 357,507 | $ | 12,793 | $ | 370,300 | |||||||
Geographic information based on location of customer is as follows: | |||||||||||||
For the years ended | |||||||||||||
December 31, | |||||||||||||
2013 | 2012 | ||||||||||||
United States | $ | 2,810,973 | $ | 2,652,265 | |||||||||
Europe | 418,876 | 54,312 | |||||||||||
Other | 72,095 | - | |||||||||||
$ | 3,301,944 | $ | 2,706,577 | ||||||||||
Major customers based on revenue are as follows: | |||||||||||||
For the years ended | |||||||||||||
December 31, | |||||||||||||
2013 | 2012 | ||||||||||||
Lockheed Martin (Astrolink) | $ | 337,796 | $ | 568,002 | |||||||||
National Science Foundation | 780,579 | 874,492 | |||||||||||
U.S. Federal Government | 150,000 | 416,422 | |||||||||||
Defense Advanced Research Projects Agency | 411,360 | $ | 281,440 | ||||||||||
Subsequent_Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2013 | |
Subsequent Events [Abstract] | ' |
Subsequent Events | ' |
18. Subsequent Events | |
Management's Evaluation | |
The Company's management has evaluated subsequent events occurring after December 31, 2013 and through the issuance date of March 31, 2014, and has determined that the following material events and transactions occurred during this period. | |
Merger with Ekso Bionics Holdings, Inc. | |
The Merger | |
On January 15, 2014, the Company entered into an Agreement and Plan of Merger and Reorganization (the "Merger Agreement") with Ekso Bionics Holdings, Inc., formerly known as PN Med Group, Inc. ("Holdings"), a public reporting company, and Ekso Acquisition Sub, Inc. ("Acquisition Sub"), a newly formed wholly-owned subsidiary of Ekso Bionics Holdings, Inc. Under the Merger Agreement, Acquisition Sub merged with and into the Company, with the Company remaining as the surviving corporation in the Merger, and became a wholly-owned subsidiary of Holdings (the "Merger"). | |
Holdings was incorporated in the State of Nevada on January 30, 2012, as a distributor of medical supplies and equipment to municipalities, hospitals, pharmacies, care centers, and clinics in Chile. Holdings was until the consummation of the Merger a "shell company" as defined in Rule 12b-2 of the Exchange Act. As a result of the Merger, Holdings discontinued its pre-Merger business and acquired the business of the Company and will continue the existing business operations of the Company. | |
At the closing of the Merger on January 15, 2014, (a) all shares of the Company's common stock and preferred stock issued and outstanding immediately prior to the closing of the Merger were converted into an aggregate of 42,615,556 restricted shares of Holdings' common stock, (b) all warrants to purchase Company stock outstanding immediately prior to the closing of the Merger were converted into warrants to purchase an aggregate of 621,363 restricted shares of Holdings' common stock, and (c) all options to purchase Company stock outstanding immediately prior to the closing of the Merger were converted into options to purchase an aggregate of 7,586,459 restricted shares of Holdings' common stock. Additionally, in connection with the Merger, Holdings issued 250,000 shares of Holdings' common stock to three consultants under a consulting agreement in consideration of business and consulting services provided by the consultants. | |
In January and February 2014, Holdings completed closings of a private placement to accredited investors of 30,300,000 Units at a price of $1.00 per Unit, resulting in $30.3 million in gross proceeds to Holdings (including the conversion of $5,000,000 of 2013 Bridge Notes issued in November 2013 (the 2013 Bridge Notes are more fully discussed in Note 9, Convertible Debt) and before deducting commissions and expenses of the offering). Each Unit consists of one share of common stock of Holdings and a warrant to purchase one share of common stock of Holdings with a term of five years and an exercise price of $2.00 per share. These warrants have weighted average anti-dilution protection, subject to customary exceptions. | |
Also, upon the closing of the Merger and the private placement financing, investors in the Bridge Notes received additional warrants (also discussed in Note 9, Convertible Debt) to purchase a number of shares of common stock of Holdings equal to 50% of the number of shares of common stock of Holdings contained in the Units into which the Bridge Notes were converted (i.e. 2,500,000 shares in the aggregate), at an exercise price of $1.00 per share, for a term of three years (the "Bridge Warrants"). The Bridge Warrants have weighted average anti-dilution protection, subject to customary exceptions. | |
Other Warrants | |
In connection with the Merger and the private placement financing, in addition to the Bridge Warrants, Holdings issued 500,000 warrants on common stock to the placement agent for the Bridge Notes financing, warrants to purchase 2,530,000 shares of common stock to the private placement offering agent and warrants to purchase 225,000 shares of common stock to the senior lender (also discussed in Note 8, Senior Notes Payable). | |
Accounting for the Merger | |
Ekso Bionics, Inc., as the accounting acquirer, will record the merger as the issuance of stock for the net monetary assets of Ekso Bionics Holdings, Inc. (formerly known as PN Med Group, Inc.), accompanied by a recapitalization. This accounting will be identical to that resulting from a reverse merger, except that no goodwill or intangible assets will be recorded. The historical financial statements of Holdings before the Merger will be replaced with the historical financial statements of the Company before the Merger in all future filings with the SEC. The Merger is intended to be treated as a tax-free exchange under Section 368(a) of the Internal Revenue Code of 1986, as amended. |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies and Estimates (Policy) | 12 Months Ended | ||
Dec. 31, 2013 | |||
Summary of Significant Accounting Policies and Estimates [Abstract] | ' | ||
Principles of Consolidation | ' | ||
Principles of Consolidation | |||
The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States and include the accounts of Ekso Bionics, Inc. and its wholly-owned subsidiary, Ekso Bionics, Ltd. All significant intercompany transactions and balances have been eliminated. | |||
Use of Estimates | ' | ||
Use of Estimates | |||
The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America ("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the balance sheet, and the reported amounts of revenues and expenses during the reporting period. For the Company, these estimates include, but are not limited to: revenue recognition, useful lives assigned to long-lived assets, realizability of deferred tax assets, valuation of common and preferred stock warrants and options, and the valuation of common stock for purposes of determining stock-based compensation and contingencies. Actual results could differ from those estimates. | |||
Foreign Currency Translation | ' | ||
Foreign Currency Translation | |||
The Company uses the U.S. dollar as its functional currency. Since some of the Company's transactions are executed in various non-U.S. dollar currencies, the Company converts these transactions into U.S. dollars for reporting purposes. Income, expenses and cash flows are translated at average exchange rates prevailing during the reporting period, and assets and liabilities are translated at year-end exchange rates. Foreign exchange transaction gains and losses are included in other income (expense), in the accompanying consolidated statements of operations. Amounts of such gains and losses were not significant through December 31, 2013. | |||
Cash and Cash Equivalents | ' | ||
Cash and Cash Equivalents | |||
The Company considers all highly liquid investments purchased with a maturity of three months or less to be cash equivalents. The Company's cash is deposited in bank accounts with the Company's primary cash management bank. The Company places its cash and cash equivalents in highly liquid instruments with, and in the custody of, financial institutions with high credit ratings and limits the amounts invested with any one institution, type of security and issuer. The Company did not have any cash equivalents or investments in money market funds as of December 31, 2013 and 2012. | |||
Concentration of Credit Risk and Other Risks and Uncertainties | ' | ||
Concentration of Credit Risk and Other Risks and Uncertainties | |||
Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and accounts receivable. The Company maintains its cash accounts in excess of federally insured limits. However, management believes the Company is not exposed to significant credit risk due to the financial position of the depository institutions in which these deposits are held. | |||
The Company extends credit to customers in the normal course of business and performs ongoing credit evaluations of its customers. Concentrations of credit risk with respect to accounts receivable exist to the full extent of amounts presented in the consolidated financial statements. The Company performs ongoing credit evaluations of its customers and does not require collateral from its customers to secure accounts receivable. | |||
Accounts receivable are derived from the sale of products shipped and services performed for customers located in the U.S. and throughout the world. Invoices are aged based on contractual terms with the customer. The Company reviews its accounts receivable for collectability and provides an allowance for credit losses, as needed. The Company has not experienced any losses related to accounts receivable as of December 31, 2013 and 2012. | |||
Many of the sales contracts with customers outside of the U.S. are settled in a foreign currency other than the U.S. dollar. The Company does not enter into any foreign currency hedging agreements and is susceptible to gains and losses from foreign currency fluctuations. To date, the Company has not experienced significant gains or losses upon settling foreign contracts. | |||
In 2013, the Company had two customers with accounts receivable balances totaling 10% or more of the Company's total accounts receivable (28% and 19%), compared with four customers in 2012 (26%, 24%, 21% and 17%). | |||
In 2013, the Company had three customers with net revenue balances of 10% or more of the Company's total customer revenue (24%, 12% and 10%), compared with four customers in 2012 (32%, 15%, 12% and 10%). | |||
Inventories, net | ' | ||
Inventories, net | |||
Inventories are recorded at the lower of cost or market value. Cost is principally determined using the average cost method. Parts from vendors are received and recorded as raw material. Once the raw materials are incorporated in the fabrication of the product, the related value of the component is recorded as work in progress ("WIP"). Direct and indirect labor and applicable overhead costs are also allocated and recorded to WIP inventory. Finished goods are comprised of completed products that are ready for customer shipment. The Company periodically evaluates the carrying value of inventory on hand for potential excess amounts over sales and forecasted demand. Excess and obsolete inventories identified would be recorded as an inventory impairment charge to the consolidated statement of operations. | |||
Property and Equipment | ' | ||
Property and Equipment | |||
Property and equipment are stated at cost less accumulated depreciation and are depreciated on a straight-line basis over the estimated useful lives of the assets, generally ranging from three to five years. Leasehold improvements are amortized over the shorter of their estimated useful lives or the related terms of the leases, generally ranging from five to ten years. | |||
The costs of repairs and maintenance are expensed when incurred, while expenditures for refurbishments and improvements that significantly add to the productive capacity or extend the useful life of an asset are capitalized. When assets are retired or sold, the asset cost and related accumulated depreciation or amortization are removed from the accompanying consolidated balance sheets, with any gain or loss reflected in the accompanying consolidated statements of operations. | |||
Impairment of Long-Lived Assets | ' | ||
Impairment of Long-Lived Assets | |||
The Company assesses the impairment of long-lived assets whenever events or changes in circumstances indicate that their carrying value may not be recoverable from the estimated future cash flows expected to result from their use or eventual disposition. The Company's long-lived assets subject to this evaluation include only property and equipment. If estimates of future undiscounted net cash flows are insufficient to recover the carrying value of the assets, the Company will record an impairment loss in the amount by which the carrying value of the assets exceeds the fair value. If the assets are determined to be recoverable, but the useful lives are shorter than originally estimated, the Company will depreciate or amortize the net book value of the assets over the newly determined remaining useful lives. For each of the years ended December 31, 2013 and 2012, none of the Company's property and equipment was determined to be impaired. Accordingly, no impairment loss has been recognized. | |||
Convertible Debt Instruments | ' | ||
Convertible Debt Instruments | |||
The Company accounts for hybrid contracts that feature conversion options in accordance with applicable GAAP. Accounting Standards Codification ("ASC") 815, Derivatives and Hedging Activities, ("ASC 815") requires companies to bifurcate conversion options from their host instruments and account for them as free standing derivative financial instruments according to certain criteria. The criteria includes circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument. | |||
Conversion options that contain variable settlement features such as provisions to adjust the conversion price upon subsequent issuances of equity or equity linked securities at exercise prices more favorable than that featured in the hybrid contract generally result in their bifurcation from the host instrument. | |||
The Company accounts for convertible instruments, when the Company has determined that the embedded conversion options should not be bifurcated from their host instruments, in accordance with ASC 470-20, Debt with Conversion and Other Options ("ASC 470-20"). Under ASC 470-20 the Company records, when necessary, discounts to convertible notes for the intrinsic value of conversion options embedded in debt instruments based upon the differences between the fair value of the underlying common stock at the commitment date of the note transaction and the effective conversion price embedded in the note. The Company accounts for convertible instruments (when the Company has determined that the embedded conversion options should be bifurcated from their host instruments) in accordance with ASC 815. Under ASC 815, a portion of the proceeds received upon the issuance of the hybrid contract are allocated to the fair value of the derivative. The derivative is subsequently marked to market at each reporting date based on current fair value, with the changes in fair value reported in results of operations. | |||
The Company also follows ASC 480-10, Distinguishing Liabilities from Equity ("ASC 480-10") in its evaluation of the accounting for a hybrid instrument. A financial instrument that embodies an unconditional obligation, or a financial instrument other than an outstanding share that embodies a conditional obligation, that the issuer must or may settle by issuing a variable number of its equity shares shall be classified as a liability (or an asset in some circumstances) if, at inception, the monetary value of the obligation is based solely or predominantly on any one of the following: (a) a fixed monetary amount known at inception (for example, a payable settleable with a variable number of the issuer's equity shares); (b) variations in something other than the fair value of the issuer's equity shares (for example, a financial instrument indexed to the Standard and Poor's S&P 500 Index and settleable with a variable number of the issuer's equity shares); or (c) variations inversely related to changes in the fair value of the issuer's equity shares (for example, a written put option that could be net share settled). Hybrid instruments meeting these criteria are not further evaluated for any embedded derivatives, and are carried as a liability at fair value at each balance sheet date with remeasurements reported in interest expense in the accompanying consolidated statements of operations. | |||
Warrants Issued in Connection with Financings | ' | ||
Warrants Issued in Connection with Financings | |||
The Company generally accounts for warrants issued in connection with debt and equity financings as a component of equity, unless the warrants include a conditional obligation to issue a variable number of shares or there is a deemed possibility that the Company may need to settle the warrants in cash. For warrants issued with a conditional obligation to issue a variable number of shares or the deemed possibility of a cash settlement, the Company records the fair value of the warrants as a liability at each balance sheet date and records changes in fair value in other income (expense) in the accompanying consolidated statements of operations. | |||
Fair Value of Financial Instruments | ' | ||
Fair Value of Financial Instruments | |||
ASC 820, Fair Value Measurements ("ASC 820") clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. | |||
ASC 820 requires that the valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. ASC 820 establishes a three tier value hierarchy, which prioritizes inputs that may be used to measure fair value as follows: | |||
• | Level 1-Observable inputs that reflect quoted prices for identical assets or liabilities in active markets. | ||
• | Level 2-Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | ||
• | Level 3-Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. | ||
The carrying amounts of current assets, current liabilities and the non-current portion of customer advances and deferred revenues approximate their fair values because of the relatively short periods until they mature or are required to be settled. The fair values of the notes payable also approximate their fair values because of the relatively short periods until they mature. A majority of the notes are payable in 2014 and 2015. The fair value of convertible debt is based on its settlement value "as if" conversion occurred on the reporting date, and stock options and preferred stock warrant liabilities are estimated using the Black-Scholes option pricing model, all as more fully discussed in their respective footnotes. | |||
Deferred Rent | ' | ||
Deferred Rent | |||
Deferred rent consists of the difference between cash payments and the recognition of rent expense on a straight-line basis over the life of the lease. | |||
Revenue and Cost of Revenue Recognition | ' | ||
Revenue and Cost of Revenue Recognition | |||
When collaboration, other research arrangements and product sales include multiple-element revenue arrangements, the Company accounts for these transactions by identifying the elements, or deliverables, included in the arrangement and determining which deliverables are separable for accounting purposes. The Company considers delivered items to be a separate unit of accounting if the delivered item(s) have stand-alone value to the customer and delivery or performance of the undelivered item is considered probable and substantially in the control of the vendor. | |||
The Company recognizes revenue when the four basic criteria of revenue recognition are met: | |||
• | Persuasive evidence of an arrangement exists. Customer contracts and purchase orders are generally used to determine the existence of an arrangement. | ||
• | The transfer of technology or products has been completed or services have been rendered. Customer acceptance, when applicable, is used to verify delivery. | ||
• | The sales price is fixed or determinable. The Company assesses whether the cost is fixed or determinable based on the payment terms associated with the transaction and whether the sales price is subject to refund or adjustment. | ||
• | Collectability is reasonably assured. The Company assesses collectability based primarily on the creditworthiness of the customer as determined by credit checks and analysis as well as the customer's payment history. | ||
Beginning in 2012, with the commercialization of the Ekso, the Company began to recognize revenue from the sales of the Ekso and related services. | |||
Medical Device Revenue and Cost of Revenue Recognition | |||
The Company builds medical devices called the Ekso for sale and capitalizes into inventory materials, direct and indirect labor and overhead in connection with manufacture and assembly of these units. | |||
In a typical Ekso sales arrangement, the Company is obligated to deliver to the customer the Ekso unit and related software (the software is essential to the unit's functionality), post-sale training, technical support and maintenance. Because of the uniqueness of the Ekso unit and its use, none of these deliverables has standalone value to the customer. Accordingly, once a sales arrangement with a fixed or determinable price and reasonably assured payment is in place, the entire arrangement is accounted for as a single unit of accounting. The total sales price for the delivered and undelivered elements are deferred and amortized to revenue beginning at the completion of training on a straight line basis over the maintenance period, usually three years, which is the last delivered item. | |||
Because of the limited guidance about how to account for costs associated with a delivered item that cannot be separated from the undelivered items, the accounting for such costs must be based on the conceptual framework and analogies to the limited guidance that does exists. Accordingly, the Company accounts for the costs of the delivered items following, by analogy, the guidance in Accounting Standards Codification ("ASC") 310-20, Nonrefundable Fees and Other Costs ("ASC 310-20"). Under this guidance, upon completion of training, the costs capitalized into inventory including direct material, direct and indirect labor, as well as overhead costs are deferred and then amortized to costs of sales on the same basis as deferred revenue. The Company's inclusion of indirect labor and overhead costs are included in inventory because, under the conceptual framework, they add value to the Ekso unit and are otherwise appropriate inventory costs. Since the Company has an enforceable contract for the remaining deliverables and the entire arrangement is expected to generate positive margins, realization of the capitalized costs is probable and, as such, deferring and amortizing them on the same basis as deferred revenue is appropriate. | |||
At the time of shipment to the customer, the related inventory is reclassified to deferred cost of revenue where it is amortized to cost of revenue over the same period that revenue is recognized. All costs incurred subsequent to the date of shipment are expensed as incurred. The cost of medical device revenue includes expenses associated with the manufacture and delivery of devices including materials, payroll, benefits, subcontractor expenses, depreciation of manufacturing equipment, excess and obsolete inventory costs, and shipping charges. | |||
Engineering Services Revenue and Cost of Revenue | |||
The Company enters into technology license agreements that typically provide for annual minimum access fees. When these annual minimum payments have separate stand-alone values, the Company recognizes revenue when the technology is transferred or accessed, provided that the technology transferred or accessed is not dependent on the outcome of continuing research and/or other development efforts. | |||
Collaborative arrangements typically consist of cost reimbursements for specific engineering and development spending, and future product royalty payments. Cost reimbursements for engineering and development spending are recognized as the related project labor hours are incurred in relation to all labor hours and when collectability is reasonably assured. Amounts received in advance are recorded as deferred revenue until the technology is transferred, services are rendered, or milestones are reached. Product royalty payments are recorded when earned under the arrangement. | |||
Government grants, which support the Company's research efforts in specific projects, generally provide for reimbursement of approved costs as defined in the notices of grant awards. Grant revenue is recognized as the associated project labor hours are incurred in relation to total labor hours. There are some grants, like the National Science Foundation grants, which the Company draws upon and spends based on budgets preapproved by the grantor. | |||
The cost of engineering services revenue includes payroll and benefits, subcontractor expenses and materials. All costs related to engineering services are expensed as incurred and reported as cost of revenue. | |||
Research and Development | ' | ||
Research and Development | |||
Research and development costs consist of costs incurred for the Company's own internal research and development activities. These costs primarily include salaries and other personnel-related expenses, contractor fees, facility costs, supplies, and depreciation of equipment associated with the design and development of new products prior to the establishment of their technological feasibility. Such costs are expensed as incurred. | |||
Advertising and Marketing Costs | ' | ||
Advertising and Marketing Costs | |||
Advertising and marketing costs are charged to sales and marketing expense as incurred. Advertising and marketing expense was $113,223 and $518,747 for the years ended December 31, 2013 and 2012, respectively. | |||
Shipping Costs | ' | ||
Shipping Costs | |||
Amounts billed to customers for shipping costs are recognized as revenue. Costs incurred to ship devices from the Company's manufacturing facility are recorded in cost of revenues. Shipping revenues and costs were immaterial for all periods presented. | |||
Income Taxes | ' | ||
Income Taxes | |||
The Company accounts for income taxes using the asset and liability method. Under this method, income tax expense or benefit is recognized for the amount of taxes payable or refundable for the current year and for deferred tax liabilities and assets for the future tax consequences of events that have been recognized in the Company's consolidated financial statements or tax returns. The Company accounts for any income tax contingencies in accordance with accounting guidance for income taxes. The measurement of current and deferred tax assets and liabilities is based on provisions of currently enacted tax laws. The effects of any future changes in tax laws or rates have not been considered. | |||
For the preparation of the Company's consolidated financial statements included herein, the Company estimates its income taxes and tax contingencies in each of the tax jurisdictions in which it operates prior to the completion and filing of its tax returns. This process involves estimating actual current tax expense together with assessing temporary differences resulting from differing treatment of items, such as deferred revenue, for tax and accounting purposes. These differences result in net deferred tax assets and liabilities. The Company must then assess the likelihood that the deferred tax assets will be realizable, and to the extent they believe that realizability is not likely, the Company must establish a valuation allowance. In assessing the need for any additional valuation allowance, the Company considers all the evidence available to it, both positive and negative, including historical levels of income, legislative developments, expectations and risks associated with estimates of future taxable income, and ongoing prudent and feasible tax planning strategies. | |||
Stock-based Compensation | ' | ||
Stock-based Compensation | |||
The Company measures stock-based compensation expense for all stock-based awards made to employees and directors based on the estimated fair value of the award on the date of grant using the Black-Scholes option pricing model and recognizes the fair value less estimated forfeitures, on a straight-line basis over the requisite service periods of the awards. Stock-based awards made to non-employees are measured and recognized based on the estimated fair value on the vesting date and are remeasured at each reporting period. | |||
The Company's determination of the fair value of stock-based awards on the date of grant using the Black-Scholes option pricing model is affected by the Company's stock price as well as assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to the Company's expected stock price volatility over the term of the awards, and actual and projected employee stock option exercise behaviors. Because there is insufficient information available to estimate the expected term of the stock-based awards, we adopted the simplified method of estimating the expected term pursuant to SEC Staff Accounting Bulletin No. 110. On this basis, we estimated the expected term of options granted by taking the average of the vesting term and the contractual term of the option. | |||
The Company has, from time to time, modified the terms of its stock options to employees. The Company accounts for the incremental increase in the fair value over the original award on the date of the modification as an expense for vested awards or over the remaining service (vesting) period for unvested awards. The incremental compensation cost is the excess of the fair value based measure of the modified award on the date of modification over the fair value of the original award immediately before the modification. | |||
Comprehensive Income/(Loss) | ' | ||
Comprehensive Income/(Loss) | |||
ASC 220, Comprehensive Income requires that an entity's change in equity (or net assets) be reported if it arises from transactions and other events having non-owner sources. Comprehensive loss for the periods presented was comprised solely of the Company's consolidated net loss. The comprehensive loss for the years ended December 31, 2013 and 2012 was $11,887,374 and $15,041,958, respectively. There were no other changes in equity that were excluded from the Company's consolidated net loss for all periods presented. | |||
Recently Adopted Accounting Standards | ' | ||
Recently Adopted Accounting Standards | |||
In February 2013, the Financial Accounting Standards Board (''FASB'') issued Accounting Standards Update ("ASU") 2013-02, Comprehensive Income (ASC Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income. The new ASU requires entities to disclose in a single location (either on the face of the financial statement that reports net income or in the notes) the effects of reclassifications out of accumulated other comprehensive income (''AOCI''). For items reclassified out of AOCI and into net income in their entirety, entities must disclose the effect of the reclassification on each affected net income item. For AOCI reclassification items that are not reclassified in their entirety into net income, entities must provide a cross-reference to other required U.S. GAAP disclosures. There is no change in the requirement to present the components of net income and other comprehensive income in either a single continuous statement or two separate consecutive statements. The ASU does not change the items currently reported in other comprehensive income. | |||
For public entities, the new disclosure requirements are effective for annual reporting periods beginning after December 15, 2012, and interim periods within those years (i.e., the second quarter of 2013 for entities with calendar year-ends). For nonpublic entities, ASU 2013-02 is effective prospectively for reporting periods beginning after December 15, 2013. The ASU applies prospectively, and early adoption is permitted. The adoption of this ASU did not have a material impact on the Company's consolidated financial statements as of and for the years ended December 31, 2013 and 2012. | |||
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Fair Value Measurements [Abstract] | ' | ||||||||||||||||
Schedule of Assets and Liabilities Measured at Fair Value | ' | ||||||||||||||||
The Company's fair value hierarchies for its financial assets and liabilities which require fair value measurement on a recurring basis are as follows: | |||||||||||||||||
Total | Quoted Prices in | Significant Other | Significant | ||||||||||||||
Active Markets for | Observable Inputs | Unobservable | |||||||||||||||
Identical Items | Level 2 | Inputs | |||||||||||||||
Level 1 | Level 3 | ||||||||||||||||
31-Dec-13 | |||||||||||||||||
Liabilities: | |||||||||||||||||
Warrant liability | $ | 377,747 | $ | - | $ | - | $ | 377,747 | |||||||||
Convertible debt | 5,062,417 | - | - | 5,062,417 | |||||||||||||
Total liabilities measured at estimated fair value | $ | 5,440,164 | $ | - | $ | - | $ | 5,440,164 | |||||||||
December 31, 2012 | |||||||||||||||||
Liabilities: | |||||||||||||||||
Warrant liability | $ | 563,822 | $ | - | $ | - | $ | 563,822 | |||||||||
Convertible debt | 3,528,313 | - | - | 3,528,313 | |||||||||||||
Total liabilities measured at estimated fair value | $ | 4,092,135 | $ | - | $ | - | $ | 4,092,135 | |||||||||
Summary of Changes in Fair Value of Level 3 Liabilities | ' | ||||||||||||||||
The changes in the value of the Level 3 liabilities are summarized below: | |||||||||||||||||
Convertible Notes | Warrant | ||||||||||||||||
Payable | Liability | ||||||||||||||||
Balance at January 1, 2012 | $ | - | $ | 168,338 | |||||||||||||
Issuance of warrants at fair value | - | 412,610 | |||||||||||||||
Issuance of 2012 Series B convertible bridge notes at fair value | 3,354,021 | - | |||||||||||||||
Mark to market, included in other expense, net | - | (17,126 | ) | ||||||||||||||
Mark to market, included in interest expense | 174,292 | - | |||||||||||||||
Balance at December 31, 2012 | 3,528,313 | 563,822 | |||||||||||||||
Issuance of 2012 Series B convertible bridge notes at fair value | 2,162,564 | - | |||||||||||||||
Issuance of 2013 Series B convertible bridge notes at fair value | 5,062,417 | - | |||||||||||||||
Issuance of right to receive common stock warrants at fair value included in other expense, net | - | 95,760 | |||||||||||||||
Mark to market, included in other expense, net | - | (281,835 | ) | ||||||||||||||
Mark to market, included in interest expense | 799,194 | - | |||||||||||||||
Converted to Series B convertible preferred stock | (6,490,071 | ) | - | ||||||||||||||
Balance at December 31, 2013 | $ | 5,062,417 | $ | 377,747 | |||||||||||||
Inventories_Tables
Inventories (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Inventories [Abstract] | ' | ||||||||
Schedule of Inventories | ' | ||||||||
Inventories, net consist of the following: | |||||||||
December 31, | |||||||||
2013 | 2012 | ||||||||
Raw materials | $ | 501,187 | $ | 346,634 | |||||
Work in process | 235,767 | 288,163 | |||||||
736,954 | 634,797 | ||||||||
Less inventory reserve | (11,858 | ) | (19,432 | ) | |||||
Inventory, net | $ | 725,096 | $ | 615,365 | |||||
Property_and_Equipment_net_Tab
Property and Equipment, net (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
Property and Equipment, net [Abstract] | ' | ||||||||||
Schedule of Property and Equipment, net | ' | ||||||||||
Property and equipment, net, consists of the following: | |||||||||||
Estimated | December 31, | ||||||||||
Life | 2013 | 2012 | |||||||||
Machinery and equipment | 3-5 years | $ | 1,137,240 | $ | 790,165 | ||||||
Computers and peripherals | 5 years | 327,152 | 326,443 | ||||||||
Computer software | 3-5 years | 78,351 | 78,351 | ||||||||
Leasehold improvement | 5-10 years | 606,483 | 598,740 | ||||||||
Tools, molds, dies and jigs | 5 years | 36,932 | 36,932 | ||||||||
Furniture and office equipment | 3-7 years | 251,019 | 251,019 | ||||||||
Other | 5 years | 23,079 | 23,079 | ||||||||
2,460,256 | 2,104,729 | ||||||||||
Accumulated depreciation and amortization | (884,970 | ) | (439,538 | ) | |||||||
Property and equipment, net | $ | 1,575,286 | $ | 1,665,191 | |||||||
Depreciation and amortization expense totaled $468,906 and $342,078 in 2013 and 2012, respectively. | |||||||||||
Customer_Advances_and_Deferred1
Customer Advances and Deferred Revenues (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Customer Advances and Deferred Revenues [Abstract] | ' | ||||||||
Schedule of Customer Advances and Deferred Revenues | ' | ||||||||
Customer advances, deferred revenues, and deferred unit costs consist of the following: | |||||||||
December 31, | |||||||||
2013 | 2012 | ||||||||
Customer advances and deposits | $ | 443,436 | $ | 329,006 | |||||
Deferred Ekso unit revenues | 3,462,980 | 2,928,411 | |||||||
Deferred service and software revenues | 721,921 | 207,296 | |||||||
Customer advances and deferred revenues | 4,628,337 | 3,464,713 | |||||||
Less current portion | (2,419,226 | ) | (1,566,153 | ) | |||||
Customer advances and deferred revenues, non-current | $ | 2,209,111 | $ | 1,898,560 | |||||
Deferred Ekso unit costs | $ | 1,571,897 | $ | 1,130,246 | |||||
Less current portion | (768,599 | ) | (436,483 | ) | |||||
Deferred cost of revenue, non-current | $ | 803,298 | $ | 693,763 | |||||
Accrued_Liabilities_Tables
Accrued Liabilities (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Accrued Liabilities [Abstract] | ' | ||||||||
Schedule of Accrued Liabilities | ' | ||||||||
Accrued liabilities consist of the following: | |||||||||
December 31, | |||||||||
2013 | 2012 | ||||||||
Salaries, benefits and related expenses | $ | 657,628 | $ | 771,137 | |||||
Professional fees | 421,966 | 114,676 | |||||||
Warranty expense | 288,110 | - | |||||||
Taxes | 62,283 | 35,810 | |||||||
Other | 812 | 75,853 | |||||||
Total | $ | 1,430,799 | $ | 997,476 | |||||
Operating_Lease_Tables
Operating Lease (Tables) | 12 Months Ended | ||||
Dec. 31, 2013 | |||||
Operating Lease [Abstract] | ' | ||||
Schedule of Future Minimum Lease Payments | ' | ||||
Future minimum annual lease payments under these leases are as follows as of December 31, 2013: | |||||
2014 | $ | 375,404 | |||
2015 | 375,404 | ||||
2016 | 375,405 | ||||
2017 | 156,419 | ||||
Total | $ | 1,282,632 | |||
Capital_Stock_Tables
Capital Stock (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||
Capital Stock [Abstract] | ' | ||||||||||||||||||||||||
Schedule of Issued and Outstanding Convertible Preferred Stock | ' | ||||||||||||||||||||||||
Issued and outstanding convertible preferred stock (without regard to the conversion ratio used in the Merger discussed in Note 18, Subsequent Events, Merger with Ekso Bionics Holdings, Inc.) consisted of the following at December 31, 2013: | |||||||||||||||||||||||||
Number of | |||||||||||||||||||||||||
Number of | Shares | Liquidation | Aggregate | ||||||||||||||||||||||
Shares | Issued and | Preference | Liquidation | ||||||||||||||||||||||
Series | Authorized | Outstanding | Per Share | Preference | |||||||||||||||||||||
A | 4,624,840 | 4,496,270 (1) | $ | 1.75 | $ | 7,868,473 | |||||||||||||||||||
A-2 | 4,527,010 | 4,335,414 | $ | 2.1 | $ | 9,104,369 | |||||||||||||||||||
B | 12,000,000 | 5,179,344 | $ | 2.1 | $ | 10,876,622 | |||||||||||||||||||
$ | 27,849,464 | ||||||||||||||||||||||||
-1 | Series A financing efforts commenced in December 2010 were completed in July 2011. The Company issued 4,496,270 of the 4,650,000 authorized shares of Series A convertible preferred stock in connection with this transaction. The total amount of equity raised amounted to $7.87 million. Of this amount $2.43 million was received in cash and $393,000 was completed through a conversion of debt during the year ended December 31, 2010 and the rest of the funds were raised during 2011. Lockheed, a key customer, participated in this round of financing by making an equity investment totaling $1.5 million. | ||||||||||||||||||||||||
Schedule of Outstanding Warrants | ' | ||||||||||||||||||||||||
The Company issued warrants to lenders in connection with convertible debt and to a customer in connection with a service contract. The outstanding warrants (without regard to the conversion ratio used in the Merger discussed in Note 18, Subsequent Events, Merger with Ekso Bionics Holdings, Inc.) were as follows: | |||||||||||||||||||||||||
Number | Fair Value as of | ||||||||||||||||||||||||
Warrants to | of | Date of | Exercise | Expiration | 31-Dec | ||||||||||||||||||||
purchase shares of: | shares | issue | Price | Date | At Inception | 2013 | 2012 | ||||||||||||||||||
Series A, to lender | 128,570 | 4/29/11 | $ | 1.75 | 10/31/21 | $ | 167,256 | $ | 69,312 | $ | 151,738 | ||||||||||||||
Series B, to lender | 257,829 | 5/31/12 | $ | 2.1 | 6/1/22 | $ | 348,327 | 181,567 | 354,593 | ||||||||||||||||
Common stock, to lender | 19,337 | 5/31/12 | $ | 2.1 | 6/1/22 | $ | 6,789 | N/A | N/A | ||||||||||||||||
Series B to customer | 27,500 | 11/16/12 | $ | 0.01 | 11/16/19 | $ | 57,494 | 31,108 | 57,491 | ||||||||||||||||
Common stock, to investors in Series B | 388,435 | Various from 5/20/2013 to 8/29/2013 | $ | 2.1 | 10 years from issue | $ | 136,380 | N/A | N/A | ||||||||||||||||
281,987 | 563,822 | ||||||||||||||||||||||||
Obligation to issue warrant (see last paragraph) | 95,760 | - | |||||||||||||||||||||||
Total warrant liability | $ | 377,747 | $ | 563,822 | |||||||||||||||||||||
(Note: The fair value as of period end is not applicable (N/A) for the warrants on common stock because such instruments are carried in equity without revaluation to periodic fair value.) |
Employee_Stock_Options_Tables
Employee Stock Options (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Employee Stock Options [Abstract] | ' | ||||||||||||
Summary of Stock Option Activity | ' | ||||||||||||
The following table summarizes stock option activity under the Company's stock option plan (without regard to the conversion ratio used in the Merger discussed in Note 18, Subsequent Events): | |||||||||||||
Shares | Number of | Weighted-Average | |||||||||||
Available | Options | Exercise | |||||||||||
For Grant | Outstanding | Price | |||||||||||
Balance at December 31, 2011 | 2,473,010 | 3,539,600 | $ | 0.357 | |||||||||
Options granted | (1,879,375 | ) | 1,879,375 | 0.792 | |||||||||
Options exercised | - | (156,624 | ) | 0.203 | |||||||||
Options repurchased | 8,122 | - | - | ||||||||||
Options cancelled | 958,679 | (958,679 | ) | 0.463 | |||||||||
Balance at December 31, 2012 | 1,560,436 | 4,303,672 | 0.524 | ||||||||||
Options granted | (1,794,782 | ) | 1,794,782 | 0.93 | |||||||||
Options exercised | - | (504,321 | ) | 0.127 | |||||||||
Options cancelled | 624,388 | (624,388 | ) | 0.718 | |||||||||
Balance at December 31, 2013 | 390,042 | 4,969,745 | $ | 0.686 | |||||||||
Schedule of Fair Value Calculation Assumptions | ' | ||||||||||||
The assumptions used in the Black-Scholes option pricing model in calculating the fair value of stock options granted to employees are as follows: | |||||||||||||
Years ended December 31, | |||||||||||||
2013 | 2012 | ||||||||||||
Dividend yield | - | - | |||||||||||
Risk-free interest rate | 0.83% - 1.93% | 1.20%-2.49% | |||||||||||
Expected term (in years) | 6-May | 6 | |||||||||||
Volatility | 65%-70% | 65% | |||||||||||
The assumptions used in the Black-Scholes option pricing model in calculating the fair value of stock options granted to non-employees are as follows: | |||||||||||||
Years ended December 31, | |||||||||||||
2013 | 2012 | ||||||||||||
Dividend yield | - | - | |||||||||||
Risk-free interest rate | 0.83%-1.73% | 1.63% | |||||||||||
Expected term (in years) | 5 | 5 | |||||||||||
Volatility | 66%-71% | 67% | |||||||||||
Allocation of Stock Option Compensation Expense | ' | ||||||||||||
Total stock-based compensation expense related to options granted to employees and non-employees was included in the consolidated statements of operations as follows: | |||||||||||||
December 31, | |||||||||||||
2013 | 2012 | ||||||||||||
General and administrative | $ | 197,072 | $ | 171,968 | |||||||||
Research and development | 82,608 | 69,609 | |||||||||||
Sales and marketing | 110,937 | 91,889 | |||||||||||
$ | 390,617 | $ | 333,466 | ||||||||||
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Income Taxes [Abstract] | ' | ||||||||||||||||
Schedule of Deferred Tax Assets | ' | ||||||||||||||||
At December 31, 2013 and 2012, the Company has provided a full valuation allowance against its net deferred tax assets as realization is dependent on future earnings, if any, the timing and amount which is uncertain. The valuation allowance for 2013 increased $4,805,742 from 2012. Significant components of the Company's deferred tax assets consist of the following: | |||||||||||||||||
December 31, | |||||||||||||||||
2013 | 2012 | ||||||||||||||||
Deferred tax assets: | |||||||||||||||||
Depreciation and other | $ | 1,032,972 | $ | 172,727 | |||||||||||||
Net operating loss carryforwards | 13,631,820 | 9,966,468 | |||||||||||||||
Unused R& D tax credits | 280,145 | - | |||||||||||||||
Less: Valuation allowance | (14,944,937 | ) | (10,139,195 | ) | |||||||||||||
Net deferred tax asset (liability) | $ | - | $ | - | |||||||||||||
Reconciliation of Income Tax | ' | ||||||||||||||||
Taxes computed at the statutory federal income tax rate of 34% are reconciled to the provision for income taxes as follows for the years ended December 31: | |||||||||||||||||
2013 | 2012 | ||||||||||||||||
Amount | Percent of | Amount | Percent of | ||||||||||||||
Pretax | Pretax | ||||||||||||||||
Earnings | Earnings | ||||||||||||||||
United States federal tax statutory rate | $ | (4,077,982 | ) | 34 | % | $ | (4,947,324 | ) | 34 | % | |||||||
State taxes (net of deferred benefit) | (698,354 | ) | 5.8 | % | (834,558 | ) | 5.7 | % | |||||||||
Non-U.S. taxes | 16,863 | (0.1 | )% | - | - | % | |||||||||||
Non-deductible expenses | 430,631 | (3.6 | )% | 44,883 | (0.3 | )% | |||||||||||
Tax credits | (280,145 | ) | 2.3 | % | - | - | % | ||||||||||
Other, net | (196,756 | ) | 1.6 | % | 3,153 | - | % | ||||||||||
Change in valuation allowance | 4,805,742 | (40.1 | )% | 5,733,844 | (39.4 | )% | |||||||||||
Provision for income taxes | $ | - | - | % | $ | - | - | % | |||||||||
Segment_Disclosures_Tables
Segment Disclosures (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Segment Disclosures [Abstract] | ' | ||||||||||||
Schedule of Segment Reporting Information | ' | ||||||||||||
Segment reporting information is as follows: | |||||||||||||
Engineering | Medical | ||||||||||||
Services | Devices | Total | |||||||||||
Year ended December 31, 2013 | |||||||||||||
Revenue | $ | 1,690,235 | $ | 1,611,709 | $ | 3,301,944 | |||||||
Cost of revenue | 1,253,942 | 1,460,692 | 2,714,634 | ||||||||||
Gross profit | $ | 436,293 | $ | 151,017 | $ | 587,310 | |||||||
Year ended December 31, 2012 | |||||||||||||
Revenue | $ | 2,140,355 | $ | 566,222 | $ | 2,706,577 | |||||||
Cost of revenue | 1,782,848 | 553,429 | 2,336,277 | ||||||||||
Gross profit | $ | 357,507 | $ | 12,793 | $ | 370,300 | |||||||
Schedule of Geographic Information | ' | ||||||||||||
Geographic information based on location of customer is as follows: | |||||||||||||
For the years ended | |||||||||||||
December 31, | |||||||||||||
2013 | 2012 | ||||||||||||
United States | $ | 2,810,973 | $ | 2,652,265 | |||||||||
Europe | 418,876 | 54,312 | |||||||||||
Other | 72,095 | - | |||||||||||
$ | 3,301,944 | $ | 2,706,577 | ||||||||||
Schedule of Revenue by Major Customer | ' | ||||||||||||
Major customers based on revenue are as follows: | |||||||||||||
For the years ended | |||||||||||||
December 31, | |||||||||||||
2013 | 2012 | ||||||||||||
Lockheed Martin (Astrolink) | $ | 337,796 | $ | 568,002 | |||||||||
National Science Foundation | 780,579 | 874,492 | |||||||||||
U.S. Federal Government | 150,000 | 416,422 | |||||||||||
Defense Advanced Research Projects Agency | 411,360 | $ | 281,440 | ||||||||||
Organization_Details
Organization (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Organization [Abstract] | ' | ' | ' |
Accumulated deficit | ($38,031,619) | ($26,144,245) | ' |
Working capital | -8,851,717 | ' | ' |
Stockholders' deficit | ($36,372,708) | ($25,086,389) | ($10,422,034) |
Summary_of_Significant_Account2
Summary of Significant Accounting Policies and Estimates (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Summary of Significant Accounting Policies and Estimates [Abstract] | ' | ' |
Impairment loss | ' | ' |
Revenue recognition period | '3 years | ' |
Advertising and marketing expense | 113,223 | 518,747 |
Comprehensive loss | ($11,887,374) | ($15,041,958) |
Minimum [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Estimated life | '3 years | ' |
Minimum [Member] | Leasehold improvement [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Estimated life | '5 years | ' |
Maximum [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Estimated life | '5 years | ' |
Maximum [Member] | Leasehold improvement [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Estimated life | '10 years | ' |
Customer [Member] | Customer One [Member] | Accounts receivable [Member] | ' | ' |
Concentration Risk [Line Items] | ' | ' |
Concentration percentage | 28.00% | 26.00% |
Customer [Member] | Customer One [Member] | Net sales [Member] | ' | ' |
Concentration Risk [Line Items] | ' | ' |
Concentration percentage | 24.00% | 32.00% |
Customer [Member] | Customer Two [Member] | Accounts receivable [Member] | ' | ' |
Concentration Risk [Line Items] | ' | ' |
Concentration percentage | 19.00% | 24.00% |
Customer [Member] | Customer Two [Member] | Net sales [Member] | ' | ' |
Concentration Risk [Line Items] | ' | ' |
Concentration percentage | 12.00% | 15.00% |
Customer [Member] | Customer Three [Member] | Accounts receivable [Member] | ' | ' |
Concentration Risk [Line Items] | ' | ' |
Concentration percentage | ' | 21.00% |
Customer [Member] | Customer Three [Member] | Net sales [Member] | ' | ' |
Concentration Risk [Line Items] | ' | ' |
Concentration percentage | 10.00% | 12.00% |
Customer [Member] | Customer Four [Member] | Accounts receivable [Member] | ' | ' |
Concentration Risk [Line Items] | ' | ' |
Concentration percentage | ' | 17.00% |
Customer [Member] | Customer Four [Member] | Net sales [Member] | ' | ' |
Concentration Risk [Line Items] | ' | ' |
Concentration percentage | ' | 10.00% |
Fair_Value_Measurements_Schedu
Fair Value Measurements (Schedule of Financial Assets and Liabilities Measured at Fair Value) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Liabilities: | ' | ' |
Warrant liability | $377,747 | $563,822 |
Convertible debt | 5,062,417 | 3,528,313 |
Total liabilities measured at estimated fair value | 5,440,164 | 4,092,135 |
Recurring [Member] | Quoted Prices in Active Markets for Identical Items Level 1 [Member] | ' | ' |
Liabilities: | ' | ' |
Warrant liability | ' | ' |
Convertible debt | ' | ' |
Total liabilities measured at estimated fair value | ' | ' |
Recurring [Member] | Significant Other Observable Inputs Level 2 [Member] | ' | ' |
Liabilities: | ' | ' |
Warrant liability | ' | ' |
Convertible debt | ' | ' |
Total liabilities measured at estimated fair value | ' | ' |
Recurring [Member] | Significant Unobservable Inputs Level 3 [Member] | ' | ' |
Liabilities: | ' | ' |
Warrant liability | 377,747 | 563,822 |
Convertible debt | 5,062,417 | 3,528,313 |
Total liabilities measured at estimated fair value | $5,440,164 | $4,092,135 |
Fair_Value_Measurements_Summar
Fair Value Measurements (Summary of Changes in Unobservable Inputs) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Convertible Notes Payable 2012 [Member] | ' | ' |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' |
Beginning balance | $3,528,313 | ' |
Issuance | 2,162,564 | 3,354,021 |
Conversion | -6,490,071 | ' |
Ending balance | 5,062,417 | 3,528,313 |
Convertible Notes Payable 2012 [Member] | Other expense, net [Member] | ' | ' |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' |
Issuance | ' | ' |
Mark to market | ' | ' |
Convertible Notes Payable 2012 [Member] | Interest expense [Member] | ' | ' |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' |
Mark to market | 799,194 | 174,292 |
Warrant Liability [Member] | ' | ' |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' |
Beginning balance | 563,822 | 168,338 |
Issuance | ' | 412,610 |
Conversion | ' | ' |
Ending balance | 377,747 | 563,822 |
Warrant Liability [Member] | Other expense, net [Member] | ' | ' |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' |
Issuance | 95,760 | ' |
Mark to market | -281,835 | -17,126 |
Warrant Liability [Member] | Interest expense [Member] | ' | ' |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' |
Mark to market | ' | ' |
Convertible Debt Two [Member] | ' | ' |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' |
Issuance | $5,062,417 | ' |
Inventories_Details
Inventories (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Inventories [Abstract] | ' | ' |
Raw materials | $501,187 | $346,634 |
Work in process | 235,767 | 288,163 |
Inventory | 736,954 | 634,797 |
Less inventory reserve | -11,858 | -19,432 |
Inventory, net | $725,096 | $615,365 |
Property_and_Equipment_net_Det
Property and Equipment, net (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Property and Equipment, net [Abstract] | ' | ' |
Depreciation and amortization | $468,906 | $342,078 |
Property, Plant and Equipment [Line Items] | ' | ' |
Property and equipment | 2,460,256 | 2,104,729 |
Accumulated depreciation and amortization | -884,970 | -439,538 |
Property and equipment, net | 1,575,286 | 1,665,191 |
Minimum [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Estimated life | '3 years | ' |
Maximum [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Estimated life | '5 years | ' |
Machinery and equipment [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property and equipment | 1,137,240 | 790,165 |
Machinery and equipment [Member] | Minimum [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Estimated life | '3 years | ' |
Machinery and equipment [Member] | Maximum [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Estimated life | '5 years | ' |
Computers and peripherals [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Estimated life | '5 years | ' |
Property and equipment | 327,152 | 326,443 |
Computer software [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property and equipment | 78,351 | 78,351 |
Computer software [Member] | Minimum [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Estimated life | '3 years | ' |
Computer software [Member] | Maximum [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Estimated life | '5 years | ' |
Leasehold improvement [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property and equipment | 606,483 | 598,740 |
Leasehold improvement [Member] | Minimum [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Estimated life | '5 years | ' |
Leasehold improvement [Member] | Maximum [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Estimated life | '10 years | ' |
Tools, molds, dies and jigs [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Estimated life | '5 years | ' |
Property and equipment | 36,932 | 36,932 |
Furniture and office equipment [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property and equipment | 251,019 | 251,019 |
Furniture and office equipment [Member] | Minimum [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Estimated life | '3 years | ' |
Furniture and office equipment [Member] | Maximum [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Estimated life | '7 years | ' |
Other [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Estimated life | '5 years | ' |
Property and equipment | $23,079 | $23,079 |
Customer_Advances_and_Deferred2
Customer Advances and Deferred Revenues (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Deferred Revenue Arrangement [Line Items] | ' | ' |
Customer advances and deferred revenues | $4,628,337 | $3,464,713 |
Less current portion | -2,419,226 | -1,566,153 |
Customer advances and deferred revenues, non-current | 2,209,111 | 1,898,560 |
Deferred Ekso unit costs | 1,571,897 | 1,130,246 |
Less current portion | -768,599 | -436,483 |
Deferred cost of revenue, non-current | 803,298 | 693,763 |
Customer advances and deposits [Member] | ' | ' |
Deferred Revenue Arrangement [Line Items] | ' | ' |
Customer advances and deferred revenues | 443,436 | 329,006 |
Deferred Ekso unit revenues [Member] | ' | ' |
Deferred Revenue Arrangement [Line Items] | ' | ' |
Customer advances and deferred revenues | 3,462,980 | 2,928,411 |
Deferred service and software revenues [Member] | ' | ' |
Deferred Revenue Arrangement [Line Items] | ' | ' |
Customer advances and deferred revenues | $721,921 | $207,296 |
Accrued_Liabilities_Details
Accrued Liabilities (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Accrued Liabilities [Abstract] | ' | ' |
Salaries, benefits and related expenses | $657,628 | $771,137 |
Professional fees | 421,966 | 114,676 |
Warranty expense | 288,110 | ' |
Taxes | 62,283 | 35,810 |
Other | 812 | 75,853 |
Total | $1,430,799 | $997,476 |
Senior_Notes_Payable_Details
Senior Notes Payable (Details) (USD $) | 12 Months Ended | 1 Months Ended | 12 Months Ended | ||||||
Dec. 31, 2013 | Dec. 31, 2012 | Feb. 28, 2014 | Oct. 31, 2011 | Apr. 30, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | |
Senior Lender [Member] | Senior Notes Payable [Member] | Senior Notes Payable [Member] | Senior Notes Payable [Member] | Senior Notes Payable [Member] | Senior Notes Payable [Member] | Senior Notes Payable [Member] | |||
Prime Rate [Member] | |||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Proceeds from issuance of notes payable and warrants, net of issuance costs | ' | $3,500,000 | ' | $500,000 | $1,000,000 | ' | $3,500,000 | $1,500,000 | ' |
Principal amount | ' | ' | ' | ' | ' | 5,000,000 | ' | ' | ' |
Term | ' | ' | ' | ' | ' | '30 months | ' | '6 months | ' |
Stated interest rate | ' | ' | ' | ' | ' | ' | ' | 6.25% | ' |
Basis spread | ' | ' | ' | ' | ' | ' | ' | ' | 6.25% |
Minimum interest rate | ' | ' | ' | ' | ' | 9.50% | ' | ' | ' |
Current and long-term carrying amount | ' | ' | ' | ' | ' | 2,552,632 | 4,341,862 | ' | ' |
Interest expense | 1,726,455 | 736,346 | ' | ' | ' | 447,570 | 379,312 | ' | ' |
Number of shares called by warrants | ' | ' | 225,000 | ' | ' | ' | 19,337 | 128,570 | ' |
Exercise price | ' | ' | 1 | ' | ' | ' | 2.1 | 1.75 | ' |
Expiration date | ' | ' | ' | ' | ' | ' | 1-Jun-22 | 31-Oct-21 | ' |
Fair value of warrants | ' | ' | 95,760 | ' | ' | ' | 355,116 | 167,256 | ' |
Warrant liability | $377,747 | $563,822 | $95,760 | ' | ' | ' | ' | ' | ' |
Convertible_Debt_Details
Convertible Debt (Details) (USD $) | 12 Months Ended | 2 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | |||||
Dec. 31, 2013 | Dec. 31, 2012 | Feb. 28, 2014 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | 20-May-13 | Dec. 31, 2013 | |
Bridge Warrants [Member] | Convertible Debt [Member] | Convertible Debt [Member] | Convertible Debt [Member] | Convertible Debt [Member] | Convertible Debt [Member] | Convertible Debt [Member] | Convertible Debt [Member] | |||
2012 Tranche 1 Bridge Notes [Member] | 2012 Tranche 1 Bridge Notes [Member] | 2012 Tranche 2 Bridge Notes [Member] | 2012 Bridge Notes [Member] | 2012 Bridge Notes [Member] | 2012 Bridge Notes [Member] | 2013 Bridge Notes [Member] | ||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Principal amount | ' | ' | ' | $3,311,546 | ' | $2,000,000 | ' | ' | ' | $5,000,000 |
Stated interest rate | ' | ' | ' | 5.00% | 10.00% | 10.00% | ' | ' | ' | 10.00% |
Maturity date | ' | ' | ' | 12-Nov-13 | ' | 12-Nov-13 | ' | ' | ' | 15-Jul-14 |
Conversion discount | ' | ' | ' | ' | ' | ' | ' | 5 | ' | ' |
Principal outstanding | ' | ' | ' | ' | ' | ' | ' | 3,311,546 | ' | ' |
Accrued interest | ' | ' | ' | ' | ' | ' | ' | 42,475 | ' | ' |
Unrealized appreciation | ' | ' | ' | ' | ' | ' | ' | 174,292 | ' | ' |
Fair value of convertible notes | 5,062,417 | 3,528,313 | ' | ' | ' | ' | ' | 3,528,313 | 6,490,071 | 5,062,417 |
Conversion of convertible debt | 6,490,071 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shares issued | ' | ' | ' | ' | ' | ' | 3,090,524 | ' | ' | ' |
Warrants issued | ' | ' | ' | ' | ' | ' | 388,435 | ' | ' | ' |
Exercise Price | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' |
Additional paid-in capital adjustment for equity component | ' | ' | ' | ' | ' | ' | $136,380 | ' | ' | ' |
Shares issued, price per share | ' | ' | $1 | ' | ' | ' | ' | ' | ' | ' |
Number of shares called by warrants | ' | ' | 2,500,000 | ' | ' | ' | ' | ' | ' | ' |
Warrant term | ' | ' | '3 years | ' | ' | ' | ' | ' | ' | ' |
Employee_Benefit_Plan_Details
Employee Benefit Plan (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Employee Benefit Plan [Abstract] | ' | ' |
Employer contributions | ' | ' |
Operating_Lease_Details
Operating Lease (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Operating Lease [Abstract] | ' | ' | ' |
Expiration date | 31-May-17 | 1-Jun-12 | ' |
Option to renew | '5 years | ' | ' |
Rent expense | $339,197 | $388,945 | ' |
Future minimum annual lease payments: | ' | ' | ' |
2014 | 375,404 | ' | ' |
2015 | 375,404 | ' | ' |
2016 | 375,405 | ' | ' |
2017 | 156,419 | ' | ' |
Total | 1,282,632 | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' |
Proceeds from issuance of notes payable and warrants, net of issuance costs | ' | 3,500,000 | ' |
Notes payable to landlord [Member] | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' |
Proceeds from issuance of notes payable and warrants, net of issuance costs | ' | 119,945 | 80,055 |
Principal amount | 200,000 | ' | ' |
Stated interest rate | 7.00% | ' | ' |
Periodic payment frequency | 'monthly | ' | ' |
Periodic payment | 3,960 | ' | ' |
Initial payment date | 1-Jun-12 | ' | ' |
Maturity date | 31-May-17 | ' | ' |
Current and long-term carrying amount | 162,370 | 209,893 | ' |
Repayments: | ' | ' | ' |
2014 | 47,523 | ' | ' |
2015 | 47,523 | ' | ' |
2016 | 47,523 | ' | ' |
2017 | $19,801 | ' | ' |
Related_Party_Transactions_Det
Related Party Transactions (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
Series A [Member] | Series A-2 [Member] | Series B [Member] | Investors [Member] | Investors [Member] | Eythor Bender [Member] | Eythor Bender [Member] | Eythor Bender [Member] | Eythor Bender [Member] | Government Entity [Member] | Government Entity [Member] | Government Entity [Member] | Government Entity [Member] | Government Entity [Member] | Government Entity [Member] | Astrolink [Member] | Astrolink [Member] | Astrolink [Member] | Astrolink [Member] | Astrolink [Member] | Astrolink [Member] | |||
Related Party Transaction One [Member] | Related Party Transaction Two [Member] | Related Party Transaction Three [Member] | Series A [Member] | Series A [Member] | Series A-2 [Member] | Series A-2 [Member] | Series A [Member] | Series A [Member] | Series B [Member] | Series B [Member] | |||||||||||||
Related Party Transaction [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock | 10,391,400 | 9,887,079 | ' | ' | ' | 310,400 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred stock, shares outstanding | 14,011,028 | 8,831,684 | 4,496,270 | 4,335,414 | 5,179,344 | ' | ' | ' | ' | ' | ' | ' | ' | 571,420 | 571,420 | 119,047 | 119,047 | ' | ' | 857,140 | 857,140 | 758,604 | 758,604 |
Agreement term | ' | ' | ' | ' | ' | ' | ' | ' | '12 months | '12 months | '12 months | '1 year 6 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Payments made | ' | ' | ' | ' | ' | $15,904 | $255,523 | ' | $49,000 | $20,000 | $25,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amounts payable | ' | ' | ' | ' | ' | 458,755 | 295,462 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Receivable | ' | ' | ' | ' | ' | ' | ' | 94,000 | ' | ' | ' | 0 | 114,500 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest rate | ' | ' | ' | ' | ' | ' | ' | 5.00% | 5.00% | 5.00% | 5.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Due date | ' | ' | ' | ' | ' | ' | ' | 30-Jun-15 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenue | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0 | $424,000 | ' | ' | ' | ' | $337,796 | $568,002 | ' | ' | ' | ' |
Capital_Stock_Common_and_Conve
Capital Stock (Common and Convertible Preferred Stock) (Details) (USD $) | 12 Months Ended | 0 Months Ended | 1 Months Ended | 8 Months Ended | 0 Months Ended | 8 Months Ended | 0 Months Ended | 0 Months Ended | ||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Jan. 15, 2014 | Dec. 31, 2010 | Jul. 31, 2011 | Dec. 31, 2013 | Jan. 15, 2014 | Jul. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Jan. 15, 2014 | Dec. 31, 2013 | Jan. 15, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Merger [Member] | Series A [Member] | Series A [Member] | Series A [Member] | Series A [Member] | Series A [Member] | Series A [Member] | Series A [Member] | Series A-2 [Member] | Series A-2 [Member] | Series B [Member] | Series B [Member] | Series B [Member] | Series B [Member] | |||
Merger [Member] | Lockheed [Member] | Lockheed [Member] | Lockheed [Member] | Merger [Member] | Merger [Member] | Lockheed [Member] | Lockheed [Member] | |||||||||
Class of Stock [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of shares authorized | 22,000,000 | 10,365,000 | ' | ' | 4,650,000 | 4,624,840 | ' | ' | ' | ' | 4,527,010 | ' | 12,000,000 | ' | ' | ' |
Number of shares issued | 14,011,028 | 8,831,684 | ' | ' | 4,496,270 | 4,496,270 | ' | ' | ' | ' | 4,335,414 | ' | 5,179,344 | ' | ' | ' |
Number of shares outstanding | 14,011,028 | 8,831,684 | ' | ' | ' | 4,496,270 | ' | ' | 857,140 | 857,140 | 4,335,414 | ' | 5,179,344 | ' | 758,604 | 758,604 |
Liquidation preference per share | ' | ' | ' | ' | ' | $1.75 | ' | ' | ' | ' | $2.10 | ' | $2.10 | ' | ' | ' |
Aggregate liquidation preference | $27,849,464 | ' | ' | ' | ' | $7,868,473 | ' | ' | ' | ' | $9,104,369 | ' | $10,876,622 | ' | ' | ' |
Conversion of preferred stock | ' | ' | ' | ' | ' | 1 | ' | ' | ' | ' | 1 | ' | 1 | ' | ' | ' |
Proceeds from equity issuance | ' | ' | ' | ' | 7,870,000 | ' | ' | 1,500,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Cash from issuance | ' | ' | ' | 2,430,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt conversion | $168,872 | ' | ' | $393,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Conversion ratio | ' | ' | 1.5238 | ' | ' | ' | 1.629 | ' | ' | ' | ' | 1.9548 | ' | 1.9548 | ' | ' |
Capital_Stock_Warrants_Details
Capital Stock (Warrants) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Feb. 28, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
Senior Lender [Member] | Series A [Member] | Series A [Member] | Series B [Member] | Series B [Member] | Series B [Member] | Series B [Member] | Common Stock [Member] | Common Stock [Member] | Common Stock [Member] | Common Stock [Member] | |||
Lender [Member] | Lender [Member] | Lender [Member] | Lender [Member] | Customer [Member] | Customer [Member] | Lender [Member] | Lender [Member] | Investors [Member] | Investors [Member] | ||||
Class of Warrant or Right [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of shares | ' | ' | 225,000 | 128,570 | ' | 257,829 | ' | 27,500 | ' | 19,337 | ' | 388,435 | ' |
Date of issue | ' | ' | ' | 29-Apr-11 | ' | 31-May-12 | ' | 16-Nov-12 | ' | 31-May-12 | ' | ' | ' |
Exercise Price | ' | ' | 1 | 1.75 | ' | 2.1 | ' | 0.01 | ' | 2.1 | ' | 2.1 | ' |
Expiration date | ' | ' | ' | 31-Oct-21 | ' | 1-Jun-22 | ' | 16-Nov-19 | ' | 1-Jun-22 | ' | ' | ' |
Warrant liability | $377,747 | $563,822 | $95,760 | $69,312 | $151,738 | $181,567 | $354,593 | $31,108 | $57,491 | ' | ' | ' | ' |
Fair value of warrants | ' | ' | $95,760 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Employee_Stock_Options_Narrati
Employee Stock Options (Narrative) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Employee Stock Options [Abstract] | ' | ' |
Fair value of options granted to employees | $835,896 | $898,963 |
Unrecognized compensation cost | 1,125,308 | 817,637 |
Unrecognized compensation cost, period for recognition | '3 years | '3 years |
Stock issued as compensation for consulting services | 32,590 | 46,470 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Percentage of fair market value | 100.00% | ' |
Expiration period | '10 years | ' |
Former Employees [Member] | ' | ' |
Share-based Goods and Nonemployee Services Transaction [Line Items] | ' | ' |
Vested options | 233,735 | 64,568 |
Modification of terms | 'three months to two years | 'three months to two years |
Compensation expense from the modification of terms | ' | $30,792 |
Former Employees Group Two [Member] | ' | ' |
Share-based Goods and Nonemployee Services Transaction [Line Items] | ' | ' |
Vested options | 86,318 | ' |
Modification of terms | 'three months to December 31, 2013 | ' |
10% voting power [Member] | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Percentage of fair market value | 110.00% | ' |
Expiration period | '5 years | ' |
Employee_Stock_Options_Summary
Employee Stock Options (Summary of Stock Option Activity) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Shares Available for Grant | ' | ' |
Beginning balance | 1,560,436 | 2,473,010 |
Granted | -1,794,782 | -1,879,375 |
Repurchased | ' | 8,122 |
Cancelled | 624,388 | 958,679 |
Ending balance | 390,042 | 1,560,436 |
Number of Options Outstanding | ' | ' |
Beginning balance | 4,303,672 | 3,539,600 |
Granted | 1,794,782 | 1,879,375 |
Exercised | -504,321 | -156,624 |
Cancelled | -624,388 | -958,679 |
Ending balance | 4,969,745 | 4,303,672 |
Exercisable | 2,540,220 | ' |
Weighted-Average Exercise Price | ' | ' |
Beginnig balance | $0.52 | $0.36 |
Granted | $0.93 | $0.79 |
Exercised | $0.13 | $0.20 |
Cancelled | $0.72 | $0.46 |
Ending balance | $0.69 | $0.52 |
Exercisable | $0.52 | ' |
Weighted average remaining contractual term of options exercisable | '8 years 11 days | ' |
Employee_Stock_Options_Schedul
Employee Stock Options (Schedule of Fair Value Calculation Assumptions) (Details) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Employees | ' | ' |
Dividend yield | ' | ' |
Expected term | ' | '6 years |
Volatility | ' | 65.00% |
Forfeiture rate | 10.00% | 10.00% |
Share-based Goods and Nonemployee Services Transaction [Abstract] | ' | ' |
Dividend yield | ' | ' |
Risk-free interest rate | ' | 1.63% |
Expected term | '5 years | '5 years |
Volatility | ' | 67.00% |
Minimum [Member] | ' | ' |
Employees | ' | ' |
Risk-free interest rate | 0.83% | 1.20% |
Expected term | '5 years | ' |
Volatility | 65.00% | ' |
Share-based Goods and Nonemployee Services Transaction [Abstract] | ' | ' |
Risk-free interest rate | 0.83% | ' |
Volatility | 66.00% | ' |
Maximum [Member] | ' | ' |
Employees | ' | ' |
Risk-free interest rate | 1.93% | 2.49% |
Expected term | '6 years | ' |
Volatility | 70.00% | ' |
Share-based Goods and Nonemployee Services Transaction [Abstract] | ' | ' |
Risk-free interest rate | 1.73% | ' |
Volatility | 71.00% | ' |
Employee_Stock_Options_Allocat
Employee Stock Options (Allocation of Stock Option Compensation Expense) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' |
Stock-based compensation expense | $390,617 | $333,466 |
General and Administrative [Member] | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' |
Stock-based compensation expense | 197,072 | 171,968 |
Research and Development [Member] | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' |
Stock-based compensation expense | 82,608 | 69,609 |
Sales and Marketing [Member] | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' |
Stock-based compensation expense | $110,937 | $91,889 |
Income_Taxes_Narrative_Details
Income Taxes (Narrative) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Income Taxes [Line Items] | ' | ' |
Unrecognized tax benefits | ' | ' |
Accrued interest and penalties related to uncertain tax positions | ' | ' |
Open tax year | '2007 | ' |
Research and Development [Member] | ' | ' |
Income Taxes [Line Items] | ' | ' |
Tax credit carryforwards, expiration | 31-Dec-31 | ' |
Federal [Member] | ' | ' |
Income Taxes [Line Items] | ' | ' |
Net operating loss tax carryforwards | 34,300,000 | ' |
Net operating loss tax carryforwards, expiration | 31-Dec-27 | ' |
State [Member] | ' | ' |
Income Taxes [Line Items] | ' | ' |
Net operating loss tax carryforwards | $29,200,000 | ' |
Net operating loss tax carryforwards, expiration | 31-Dec-17 | ' |
Income_Taxes_Schedule_of_Defer
Income Taxes (Schedule of Deferred Tax Assets) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Deferred tax assets: | ' | ' |
Depreciation and other | $1,032,972 | $172,727 |
Net operating loss carryforwards | 13,631,820 | 9,966,468 |
Unused R&D tax credits | 280,145 | ' |
Less: Valuation allowance | -14,944,937 | -10,139,195 |
Net deferred tax asset (liability) | ' | ' |
Income_Taxes_Reconciliation_of
Income Taxes (Reconciliation of Income Tax) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Amount | ' | ' |
United States federal tax statutory rate | ($4,077,982) | ($4,947,324) |
State taxes (net of deferred benefit) | -698,354 | -834,558 |
Non-U.S. taxes | 16,863 | ' |
Non-deductible expenses | 430,631 | 44,883 |
Tax credits | -280,145 | ' |
Other, net | -196,756 | 3,153 |
Change in valuation allowance | 4,805,742 | 5,733,844 |
Provision for income taxes | ' | ' |
Percent of Pretax Earnings | ' | ' |
United States federal tax statutory rate | 34.00% | 34.00% |
State taxes (net of deferred benefit) | 5.80% | 5.70% |
Non-U.S. taxes | -0.10% | ' |
Non-deductable expenses | -3.60% | -0.30% |
Tax credits | 2.30% | ' |
Other, net | -1.60% | ' |
Change in valuation allowance | -40.10% | -39.40% |
Provision for income taxes | ' | ' |
Commitments_and_Contingencies_
Commitments and Contingencies (Details) (Royalty Agreement Terms [Member], USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ' | ' |
Royalty | $20,000 | $10,000 |
Future minimum annual royalties | ' | ' |
2014 | 40,000 | ' |
2015 | $50,000 | ' |
Net sales [Member] | ' | ' |
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ' | ' |
Royalty percentage | 1.00% | ' |
License fees [Member] | ' | ' |
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ' | ' |
Royalty percentage | 21.00% | ' |
Sub-licensee net sales [Member] | ' | ' |
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ' | ' |
Royalty percentage | 1.00% | ' |
Segment_Disclosures_Schedule_o
Segment Disclosures (Schedule of Segment Reporting Information) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Segment Reporting Information [Line Items] | ' | ' |
Revenue | $3,301,944 | $2,706,577 |
Cost of revenue | 2,714,634 | 2,336,277 |
Gross Profit | 587,310 | 370,300 |
Engineering Services [Member] | ' | ' |
Segment Reporting Information [Line Items] | ' | ' |
Revenue | 1,690,235 | 2,140,355 |
Cost of revenue | 1,253,942 | 1,782,848 |
Gross Profit | 436,293 | 357,507 |
Medical Devices [Member] | ' | ' |
Segment Reporting Information [Line Items] | ' | ' |
Revenue | 1,611,709 | 566,222 |
Cost of revenue | 1,460,692 | 553,429 |
Gross Profit | $151,017 | $12,793 |
Segment_Disclosures_Schedule_o1
Segment Disclosures (Schedule of Geographic Information) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' |
Revenue | $3,301,944 | $2,706,577 |
Unites States [Member] | ' | ' |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' |
Revenue | 2,810,973 | 2,652,265 |
Europe [Member] | ' | ' |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' |
Revenue | 418,876 | 54,312 |
Other [Member] | ' | ' |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' |
Revenue | $72,095 | ' |
Segment_Disclosures_Schedule_o2
Segment Disclosures (Schedule of Revenue by Major Customer) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Revenue, Major Customer [Line Items] | ' | ' |
Revenue | $3,301,944 | $2,706,577 |
Lockheed Martin (Astrolink) [Member] | ' | ' |
Revenue, Major Customer [Line Items] | ' | ' |
Revenue | 337,796 | 568,002 |
National Science Foundation [Member] | ' | ' |
Revenue, Major Customer [Line Items] | ' | ' |
Revenue | 780,579 | 874,492 |
U.S. Federal Government [Member] | ' | ' |
Revenue, Major Customer [Line Items] | ' | ' |
Revenue | 150,000 | 416,422 |
Defense Advanced Research Projects Agency [Member] | ' | ' |
Revenue, Major Customer [Line Items] | ' | ' |
Revenue | $411,360 | $281,440 |
Subsequent_Events_Details
Subsequent Events (Details) (USD $) | 12 Months Ended | 0 Months Ended | 2 Months Ended | ||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Jan. 15, 2014 | Jan. 15, 2014 | Jan. 15, 2014 | Jan. 15, 2014 | Feb. 28, 2014 | Feb. 28, 2014 | Feb. 28, 2014 | Feb. 28, 2014 | Feb. 28, 2014 | |
Merger [Member] | Merger [Member] | Merger [Member] | Merger [Member] | Private Placement [Member] | Bridge Warrants [Member] | Bridge Notes Placement Agent [Member] | Private Placement Agent [Member] | Senior Lender [Member] | |||
Common stock [Member] | Warrants [Member] | Options [Member] | |||||||||
Subsequent Event [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Conversion of stock, shares issued | ' | ' | ' | 42,615,556 | 621,363 | 7,586,459 | ' | ' | ' | ' | ' |
Securities issued for services | ' | ' | 250,000 | ' | ' | ' | ' | ' | ' | ' | ' |
New issues | ' | ' | ' | ' | ' | ' | 30,300,000 | ' | ' | ' | ' |
Shares issued, price per share | ' | ' | ' | ' | ' | ' | $1 | $1 | ' | ' | ' |
Proceeds from private placement | $4,929,196 | ' | ' | ' | ' | ' | $30,300,000 | ' | ' | ' | ' |
Conversion of convertible debt | $6,490,071 | ' | ' | ' | ' | ' | $5,000,000 | ' | ' | ' | ' |
Number of shares called by warrants | ' | ' | ' | ' | ' | ' | ' | 2,500,000 | 500,000 | 2,530,000 | 225,000 |
Number of shares called by each warrant | ' | ' | ' | ' | ' | ' | 1 | ' | ' | ' | ' |
Warrant term | ' | ' | ' | ' | ' | ' | '5 years | '3 years | ' | ' | ' |
Exercise price | ' | ' | ' | ' | ' | ' | 2 | 1 | ' | ' | 1 |