Document And Entity Information
Document And Entity Information - shares | 6 Months Ended | |
Jun. 30, 2019 | Aug. 06, 2019 | |
Document Information [Line Items] | ||
Entity Registrant Name | JOINT Corp | |
Entity Central Index Key | 0001612630 | |
Trading Symbol | jynt | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Current Reporting Status | Yes | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | true | |
Entity Small Business | true | |
Entity Common Stock, Shares Outstanding (in shares) | 13,844,072 | |
Entity Shell Company | false | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Title of 12(b) Security | Common Stock |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Current Period Unaudited) - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 9,485,212 | $ 8,716,874 |
Restricted cash | 129,220 | 138,078 |
Accounts receivable, net | 1,033,479 | 806,350 |
Notes receivable - current portion | 163,573 | 149,349 |
Deferred franchise costs - current portion | 710,796 | 611,047 |
Prepaid expenses and other current assets | 887,676 | 882,290 |
Total current assets | 12,409,956 | 11,303,988 |
Property and equipment, net | 4,963,037 | 3,658,007 |
Operating lease right-of-use asset | 10,030,737 | |
Notes receivable, net of current portion and reserve | 41,683 | 128,723 |
Deferred franchise costs, net of current portion | 3,485,644 | 2,878,163 |
Intangible assets, net | 1,975,835 | 1,634,060 |
Goodwill | 3,225,145 | 3,225,145 |
Deposits and other assets | 337,379 | 599,627 |
Total assets | 36,469,416 | 23,427,713 |
Current liabilities: | ||
Accounts payable | 1,199,341 | 1,253,274 |
Accrued expenses | 178,949 | 266,322 |
Co-op funds liability | 129,220 | 104,057 |
Payroll liabilities | 1,602,916 | 2,035,658 |
Notes payable - current portion | 1,000,000 | 1,100,000 |
Deferred rent - current portion | 136,550 | |
Operating lease liability - current portion | 1,827,233 | |
Finance lease liability - current portion | 23,075 | |
Deferred franchise and regional developer fee revenue - current portion | 2,697,669 | 2,370,241 |
Deferred revenue from company clinics | 2,677,782 | 2,529,497 |
Other current liabilities | 540,279 | 477,528 |
Total current liabilities | 11,876,464 | 10,273,127 |
Deferred rent, net of current portion | 721,730 | |
Long-term lease obligation | 9,049,948 | |
Finance lease liability - net of current portion | 46,826 | |
Deferred franchise and regional developer fee revenue, net of current portion | 12,652,780 | 11,239,221 |
Deferred tax liability | 83,294 | 76,672 |
Other liabilities | 27,230 | 389,362 |
Total liabilities | 33,736,542 | 22,700,112 |
Stockholders' equity: | ||
Series A preferred stock, $0.001 par value; 50,000 shares authorized, 0 issued and outstanding, as of June 30, 2019 and December 31, 2018 | ||
Common stock, $0.001 par value; 20,000,000 shares authorized, 13,838,016 shares issued and 13,823,346 shares outstanding as of June 30, 2019 and 13,757,200 shares issued and 13,742,530 outstanding as of December 31, 2018 | 13,838 | 13,757 |
Additional paid-in capital | 38,779,538 | 38,189,251 |
Treasury stock 14,670 shares as of June 30, 2019 and December 31, 2018, at cost | (90,856) | (90,856) |
Accumulated deficit | (35,969,746) | (37,384,651) |
Total The Joint Corp. stockholders' equity | 2,732,774 | 727,501 |
Non-controlling Interest | (100) | (100) |
Total equity | 2,732,874 | 727,601 |
Total liabilities and stockholders' equity | $ 36,469,416 | $ 23,427,713 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - $ / shares | Jun. 30, 2019 | Dec. 31, 2018 |
Series A preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Series A preferred stock, shares authorized (in shares) | 50,000 | 50,000 |
Series A preferred stock, shares issued (in shares) | 0 | 0 |
Series A preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 20,000,000 | 20,000,000 |
Common stock, shares issued (in shares) | 13,838,016 | 13,757,200 |
Common stock, shares outstanding (in shares) | 13,823,346 | 13,742,530 |
Treasury stock, shares (in shares) | 14,670 | 14,670 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Revenues: | ||||
Revenues from company-owned or managed clinics | $ 11,169,979 | $ 8,804,785 | $ 21,849,356 | $ 17,451,749 |
Cost of revenues: | ||||
Total cost of revenues | 1,299,149 | 1,051,584 | 2,505,090 | 2,023,916 |
Selling and marketing expenses | 1,769,368 | 1,293,663 | 3,275,356 | 2,395,967 |
Depreciation and amortization | 404,466 | 404,975 | 770,143 | 792,392 |
General and administrative expenses | 7,227,662 | 5,867,512 | 13,780,566 | 12,136,198 |
Total selling, general and administrative expenses | 9,401,496 | 7,566,150 | 17,826,065 | 15,324,557 |
Net (gain) loss on disposition or impairment | (18,266) | 251,290 | 86,927 | 251,678 |
Income (loss) from operations | 487,600 | (64,239) | 1,431,274 | (148,402) |
Other income (expense): | ||||
Bargain purchase gain | 30,455 | 19,298 | 30,455 | |
Other income (expense), net | (15,126) | (11,103) | (26,771) | (21,910) |
Total other income (expense) | (15,126) | 19,352 | (7,473) | 8,545 |
Income (loss) before income tax (expense) benefit | 472,474 | (44,887) | 1,423,801 | (139,857) |
Income tax (expense) benefit | (10,214) | (5,951) | (8,896) | 57,404 |
Net income (loss) and comprehensive income (loss) | 462,260 | (50,838) | 1,414,905 | (82,453) |
Less: income (loss) attributable to the non-controlling interest | ||||
Net income (loss) attributable to The Joint Corp. stockholders | $ 462,260 | $ (50,838) | $ 1,414,905 | $ (82,453) |
Earnings (loss) per share: | ||||
Basic earnings (loss) per share (in dollars per share) | $ 0.03 | $ 0.10 | $ (0.01) | |
Diluted earnings (loss) per share (in dollars per share) | $ 0.03 | $ 0.10 | $ (0.01) | |
Basic weighted average shares (in shares) | 13,797,497 | 13,622,710 | 13,774,474 | 13,605,370 |
Diluted weighted average shares (in shares) | 14,477,007 | 13,622,710 | 14,390,320 | 13,605,370 |
Revenues and Management Fees from Company Clinics [Member] | ||||
Revenues: | ||||
Revenues from company-owned or managed clinics | $ 5,777,288 | $ 4,668,638 | $ 11,416,365 | $ 9,474,311 |
Royalty [Member] | ||||
Revenues: | ||||
Revenues from company-owned or managed clinics | 3,263,530 | 2,421,185 | 6,290,346 | 4,695,173 |
Franchise [Member] | ||||
Revenues: | ||||
Revenues from company-owned or managed clinics | 447,266 | 449,144 | 864,339 | 797,481 |
Cost of revenues: | ||||
Cost of Goods and Services Sold | 1,198,378 | 977,782 | 2,315,431 | 1,850,550 |
Advertising [Member] | ||||
Revenues: | ||||
Revenues from company-owned or managed clinics | 927,800 | 687,752 | 1,819,367 | 1,346,782 |
Technology Service [Member] | ||||
Revenues: | ||||
Revenues from company-owned or managed clinics | 377,125 | 315,910 | 742,361 | 623,385 |
Cost of revenues: | ||||
Cost of Goods and Services Sold | 100,771 | 73,802 | 189,659 | 173,366 |
Regional Developer Fees [Member] | ||||
Revenues: | ||||
Revenues from company-owned or managed clinics | 200,524 | 137,412 | 384,381 | 261,423 |
Product and Service, Other [Member] | ||||
Revenues: | ||||
Revenues from company-owned or managed clinics | $ 176,446 | $ 124,744 | $ 332,197 | $ 253,194 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited) - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | Treasury Stock [Member] | Retained Earnings [Member] | Parent [Member] | Noncontrolling Interest [Member] | Total |
Balance (in shares) at Dec. 31, 2017 | 13,600,338 | 14,084 | |||||
Balance at Dec. 31, 2017 | $ 13,600 | $ 37,229,869 | $ (86,045) | $ (37,531,345) | $ (373,921) | $ 100 | $ (373,821) |
Stock-based compensation expense | 346,629 | 346,629 | 346,629 | ||||
Issuance of vested restricted stock (in shares) | 59,700 | ||||||
Issuance of vested restricted stock | $ 60 | (60) | |||||
Exercise of stock options (in shares) | |||||||
Exercise of stock options | $ 78 | 274,810 | 274,888 | 274,888 | |||
Net income (loss) | (82,453) | (82,453) | (82,453) | ||||
Balance (in shares) at Jun. 30, 2018 | 13,660,038 | 14,084 | |||||
Balance at Jun. 30, 2018 | $ 13,738 | 37,851,248 | $ (86,045) | (37,613,798) | 165,143 | 100 | 165,243 |
Balance (in shares) at Dec. 31, 2017 | 13,600,338 | 14,084 | |||||
Balance at Dec. 31, 2017 | $ 13,600 | 37,229,869 | $ (86,045) | (37,531,345) | (373,921) | 100 | (373,821) |
Balance (in shares) at Dec. 31, 2018 | 13,757,200 | 14,670 | |||||
Balance at Dec. 31, 2018 | $ 13,757 | 38,189,251 | $ (90,856) | (37,384,651) | 727,501 | 100 | 727,601 |
Stock-based compensation expense | 350,724 | 350,724 | 350,724 | ||||
Issuance of vested restricted stock (in shares) | 33,012 | ||||||
Issuance of vested restricted stock | $ 33 | (33) | |||||
Exercise of stock options (in shares) | 47,804 | ||||||
Exercise of stock options | $ 48 | 239,596 | 239,644 | 239,644 | |||
Net income (loss) | 1,414,905 | 1,414,905 | 1,414,905 | ||||
Balance (in shares) at Jun. 30, 2019 | 13,838,016 | 14,670 | |||||
Balance at Jun. 30, 2019 | $ 13,838 | $ 38,779,538 | $ (90,856) | $ (35,969,746) | $ 2,732,774 | $ 100 | $ 2,732,874 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 1,414,905 | $ (82,453) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Depreciation and amortization | 770,143 | 792,392 |
Net loss on disposition or impairment of assets | 86,927 | 251,678 |
Net franchise fees recognized upon termination of franchise agreements | (72,450) | |
Bargain purchase gain | (19,298) | (30,455) |
Deferred income taxes | (4,788) | (75,882) |
Stock based compensation expense | 350,724 | 346,629 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (227,129) | (91,211) |
Prepaid expenses and other current assets | (5,386) | (90,449) |
Deferred franchise costs | (707,230) | (260,774) |
Deposits and other assets | 262,248 | 42,360 |
Accounts payable | (154,542) | (384,538) |
Accrued expenses | (134,146) | 33,982 |
Payroll liabilities | (432,742) | 104,538 |
Other liabilities | (286,054) | (28,527) |
Deferred revenue | 1,923,148 | 158,370 |
Net cash provided by operating activities | 2,836,780 | 613,210 |
Cash flows from investing activities: | ||
Acquisition of business, net of cash acquired | (30,000) | (80,000) |
Purchase of property and equipment | (1,567,556) | (370,757) |
Reacquisition and termination of regional developer rights | (681,500) | |
Payments received on notes receivable | 72,816 | 83,824 |
Net cash used in investing activities | (2,206,240) | (366,933) |
Cash flows from financing activities: | ||
Payments of finance lease obligation | (10,704) | |
Proceeds from exercise of stock options | 239,644 | 141,607 |
Repayments on notes payable | (100,000) | |
Net cash provided by financing activities | 128,940 | 141,607 |
Increase in cash | 759,480 | 387,884 |
Cash and restricted cash, beginning of period | 8,854,952 | 4,320,040 |
Cash and restricted cash, end of period | $ 9,614,432 | $ 4,707,924 |
Supplemental Disclosure of Non-
Supplemental Disclosure of Non-cash Activity | 6 Months Ended |
Jun. 30, 2019 | |
Notes to Financial Statements | |
Cash Flow, Supplemental Disclosures [Text Block] | During the six June 30, 2019 2018, $23,396 $19,522, six June 30, 2019 2018, $50,000 $50,000, Supplemental disclosure of non-cash activity: As of June 30, 2019, $100,609 $46,773 December 31, 2018, $121,038 $1,595 In connection with our acquisition during the six June 30, 2019, $9,166 $62,000, $30,000 $3,847, 2 In connection with our reacquisition and termination of regional developer rights during the six June 30, 2019, $44,334 8 As of June 30, 2018, $133,281 Note: The Condensed Consolidated Statements of Cash Flows is unaudited and has been restated to reflect the consolidation of variable interest entities. See Note 1 Prior Period Financial Statement Correction of Immaterial Error |
Note 1 - Nature of Operations a
Note 1 - Nature of Operations and Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2019 | |
Notes to Financial Statements | |
Organization, Consolidation and Presentation of Financial Statements Disclosure and Significant Accounting Policies [Text Block] | Note 1: Basis of Presentation These unaudited financial statements represent the condensed consolidated financial statements of The Joint Corp. (“The Joint”), its variable interest entities (“VIEs”), and its wholly owned subsidiary, The Joint Corporate Unit No. 1, LLC (collectively, the “Company”). These unaudited condensed consolidated financial statements should be read in conjunction with The Joint Corp. and Subsidiary and Affiliates consolidated financial statements and the notes thereto as set forth in The Joint Corp.’s Form 10 -K, which included all disclosures required by generally accepted accounting principles (“GAAP”) and the “ prior period financial statement correction of immaterial error ” note below. In the opinion of management, these unaudited condensed consolidated financial statements contain all adjustments necessary to present fairly the Company’s financial position on a consolidated basis and the consolidated results of operations, equity and cash flows for the interim periods presented. The results of operations for the periods ended June 30, 2019 and 2018 are not necessarily indicative of expected operating results for the full year. The information presented throughout the document as of and for the periods ended June 30, 2019 and 2018 is unaudited. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amount of assets, liabilities, revenue, costs, expenses and other (expenses) income that are reported in the condensed consolidated financial statements and accompanying disclosures. These estimates are based on management’s best knowledge of current events, historical experience, actions that the Company may undertake in the future and on various other assumptions that are believed to be reasonable under the circumstances. As a result, actual results may be different from these estimates. For a discussion of significant estimates and judgments made in recognizing revenue and accounting for leases, see Note 3, Revenue Disclosures and Note 13 , Commitments and Contingencies , respectively . Prior Period Financial Statement Correction of Immaterial Error Certain states, in which the Company manages clinics, regulate the practice of chiropractic care and require that chiropractic services be provided by legal entities organized under state laws as professional corporations or PCs. The PCs are VIEs as defined by Accounting Standards Codification 810, Consolidations (“ASC 810” ). During the first quarter of 2019, the Company reassessed the governance structure and operating procedures of the PCs and determined that the Company has the power to control certain significant non-clinical activities of the PCs, as defined by ASC 810. Therefore, the Company is the primary beneficiary of the VIEs, and per ASC 810, must consolidate the VIEs. Prior to 2019, the Company did not consolidate the PCs. The Company has concluded the previous accounting policy to not consolidate the PCs was an immaterial error and has determined that the PCs should be consolidated. The adjustments will result in an increase to revenues from company clinics and a corresponding increase to general and administrative expenses. This will have no impact on net income (loss), except when the PC has sold treatment packages and wellness plans. Revenue from these treatment packages and wellness plans will now be deferred and will be recognized when patients use their visits. The Company has corrected this immaterial error by restating the 2018 condensed consolidated financial statements and related notes included herein. The immaterial impacts of this error correction in the three and six months ended June 30, 2018 and the fiscal year ended December 31, 2018 are as follows: CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) Three Months Ended Adjustments Due To Three Months Ended June 30, 2018 VIE Consolidation June 30, 2018 (as reported) (as adjusted) Revenues: Revenues from company-owned or managed clinics $ 3,420,685 1,247,953 $ 4,668,638 Total revenues 7,556,832 1,247,953 8,804,785 General and administrative expenses 4,656,308 1,211,204 5,867,512 Total selling, general and administrative expenses 6,354,946 1,211,204 7,566,150 Loss from operations (100,402 ) 36,163 (64,239 ) Other income (expense): Bargain purchase gain 75,264 (44,809 ) 30,455 Total other income 63,575 (44,223 ) 19,352 Loss before income tax expense (36,827 ) (8,060 ) (44,887 ) Net loss and comprehensive loss $ (42,778 ) (8,060 ) $ (50,838 ) CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) Six Months Ended Adjustments Due To Six Months Ended June 30, 2018 VIE Consolidation June 30, 2018 (as reported) (as adjusted) Revenues: Revenues from company-owned or managed clinics $ 6,677,309 2,797,002 $ 9,474,311 Total revenues 14,654,747 2,797,002 17,451,749 General and administrative expenses 9,731,234 2,404,964 12,136,198 Total selling, general and administrative expenses 12,919,593 2,404,964 15,324,557 Loss from operations (539,466 ) 391,064 (148,402 ) Other income (expense): Bargain purchase gain 75,264 (44,809 ) 30,455 Total other income 52,380 (43,835 ) 8,545 Loss before income tax expense (487,086 ) 347,229 (139,857 ) Net loss and comprehensive loss $ (429,682 ) 347,229 $ (82,453 ) Loss per share: Basic and diluted loss per share $ (0.03 ) 0.02 $ (0.01 ) Basic and diluted weighted average shares 13,605,370 - 13,605,370 THE JOINT CORP. AND SUBSIDIARY AND AFFILIATES CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) December 31, Adjustments Due To December 31, 2018 VIE Consolidation 2018 ASSETS (as reported) (as adjusted) Current assets: Accounts receivable, net 1,213,707 (407,357 ) 806,350 Total current assets 11,711,345 (407,357 ) 11,303,988 Goodwill 2,916,426 308,719 3,225,145 Total assets $ 23,526,352 $ (98,639 ) $ 23,427,713 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Deferred revenue from company clinics 994,493 1,535,004 2,529,497 Total current liabilities 8,738,123 1,535,004 10,273,127 Total liabilities 21,165,108 1,535,004 22,700,112 Commitments and contingencies Equity: The Joint Corp. stockholders' equity: Accumulated deficit (35,750,908 ) (1,633,743 ) (37,384,651 ) Total The Joint Corp. stockholders' equity 2,361,244 (1,633,743 ) 727,501 Non-controlling Interest - 100 100 Total equity 2,361,244 (1,633,643 ) 727,601 Total liabilities and equity $ 23,526,352 $ (98,639 ) $ 23,427,713 Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of The Joint Corp. and its wholly owned subsidiary, The Joint Corporate Unit No. 1, LLC, which was dormant for all periods presented. The Company consolidates VIEs in which the Company is the primary beneficiary in accordance with ASC 810. Non-controlling interests represent third -party equity ownership interests in VIEs. All significant inter-affiliate accounts and transactions between The Joint Corp. and its VIEs have been eliminated in consolidation. Certain balances were reclassified from regional developer fees to other revenues for the three and six months ended June 30, 2018 to conform to the current year presentation. Comprehensive Income (Loss) Net income (loss) and comprehensive income (loss) are the same for the three and six months ended June 30, 2019 and 2018. Nature of Operations The Joint, a Delaware corporation, was formed on March 10, 2010 for the principal purpose of franchising, developing and managing chiropractic clinics, selling regional developer rights and supporting the operations of franchised chiropractic clinics at locations throughout the United States of America. The franchising of chiropractic clinics is regulated by the Federal Trade Commission and various state authorities. The following table summarizes the number of clinics in operation under franchise agreements and as company-owned or managed clinics for the three and six months ended June 30, 2019 and 2018: Three Months Ended Six Months Ended June 30, June 30, Franchised clinics: 2019 2018 2019 2018 Clinics open at beginning of period 404 359 394 352 Opened or Purchased during the period 14 8 26 15 Acquired or sold during the period – (1 ) (1 ) (1 ) Closed during the period (1 ) (1 ) (2 ) (1 ) Clinics in operation at the end of the period 417 365 417 365 Three Months Ended Six Months Ended June 30, June 30, Company-owned or managed clinics: 2019 2018 2019 2018 Clinics open at beginning of period 50 47 48 47 Opened during the period 1 – 3 – Acquired during the period – 1 1 1 Closed or Sold during the period – – (1 ) – Clinics in operation at the end of the period 51 48 51 48 Total clinics in operation at the end of the period 468 413 468 413 Clinic licenses sold but not yet developed 176 117 176 117 Executed letters of intent for future clinic licenses 28 9 28 9 Variable Interest Entities An entity deemed to hold the controlling interest in a voting interest entity or deemed to be the primary beneficiary of a VIE is required to consolidate the VIE in its financial statements. An entity is deemed to be the primary beneficiary of a VIE if it has both of the following characteristics: (a) the power to direct the activities of a VIE that most significantly impact the VIE's economic performance and (b) the obligation to absorb the majority of losses of the VIE or the right to receive the majority of benefits from the VIE. Certain states, in which the Company manages clinics, regulate the practice of chiropractic care and require that chiropractic services be provided by legal entities organized under state laws as professional corporations or PCs. Such PCs are VIEs, as fees paid by the PC to the Company as its management service provider are considered variable interests because they are liabilities on the PC’s books and the fees do not meet all the following criteria: 1 ) The fees are compensation for services provided and are commensurate with the level of effort required to provide those services; 2 ) The decision maker or service provider does not hold other interests in the VIE that individually, or in the aggregate, would absorb more than an insignificant amount of the VIE’s expected losses or receive more than an insignificant amount of the VIE’s expected residual returns; 3 ) The service arrangement includes only terms, conditions, or amounts that are customarily present in arrangements for similar services negotiated at arm’s length. In these states, the Company has entered into management services agreements with PCs under which the Company provides, on an exclusive basis, all non-clinical services of the chiropractic practice. During the first quarter of 2019, the Company reassessed the governance structure and operating procedures of the PCs and determined that the Company has the power to control certain significant non-clinical activities of the PCs, as defined by ASC 810, Therefore, the Company is the primary beneficiary of the VIEs, and per ASC 810, must consolidate the VIEs. The carrying amount of VIE assets and liabilities are immaterial as of June 30, 2019. Cash and Cash Equivalents The Company considers all highly liquid instruments purchased with an original maturity of three months or less to be cash equivalents. The Company continually monitors its positions with, and credit quality of, the financial institutions with which it invests. As of the balance sheet date and periodically throughout the period, the Company has maintained balances in various operating accounts in excess of federally insured limits. The Company has invested substantially all its cash in short-term bank deposits. The Company had no cash equivalents as of June 30, 2019 and December 31, 2018. Restricted Cash Restricted cash relates to cash that franchisees and company-owned or managed clinics contribute to the Company’s National Marketing Fund and cash that franchisees provide to various voluntary regional Co-Op Marketing Funds. Cash contributed by franchisees to the National Marketing Fund is to be used in accordance with the Company’s Franchise Disclosure Document with a focus on regional and national marketing and advertising. Accounts Receivable Accounts receivable represent amounts due from franchisees for initial franchise fees and royalty fees. The Company considers a reserve for doubtful accounts based on the creditworthiness of the entity. The provision for uncollectible amounts is continually reviewed and adjusted to maintain the allowance at a level considered adequate to cover future losses. The allowance is management’s best estimate of uncollectible amounts and is determined based on specific identification and historical performance that the Company tracks on an ongoing basis. Actual losses ultimately could differ materially in the near term from the amounts estimated in determining the allowance. As of June 30, 2019, and December 31, 2018, the Company had an allowance for doubtful accounts of $0. Deferred Franchise Costs Deferred franchise costs represent commissions that are direct and incremental to the Company and are paid in conjunction with the sale of a franchise. These costs are recognized as an expense, in franchise cost of revenues when the respective revenue is recognized, which is generally over the term of the related franchise agreement. Property and Equipment Property and equipment are stated at cost or for property acquired as part of franchise acquisitions at fair value at the date of closing. Depreciation is computed using the straight-line method over estimated useful lives of three to seven years. Leasehold improvements are amortized using the straight-line method over the shorter of the lease term or the estimated useful life of the assets. Maintenance and repairs are charged to expense as incurred; major renewals and improvements are capitalized. When items of property or equipment are sold or retired, the related cost and accumulated depreciation are removed from the accounts and any gain or loss is included in income. Capitalized Software The Company capitalizes certain software development costs. These capitalized costs are primarily related to software used by clinics for operations and by the Company for the management of operations. Costs incurred in the preliminary stages of development are expensed as incurred. Once an application has reached the development stage, internal and external costs, if direct, are capitalized as assets in progress until the software is substantially complete and ready for its intended use. Capitalization ceases upon completion of all substantial testing. The Company also capitalizes costs related to specific upgrades and enhancements when it is probable the expenditures will result in additional functionality. Software developed is recorded as part of property and equipment. Maintenance and training costs are expensed as incurred. Internal use software is amortized on a straight-line basis over its estimated useful life, generally five years. Leases The Company adopted the guidance of Accounting Standards Codification 842 – Leases (“ASC 842” ) on January 1, 2019 which requires lessees to recognize a right-of-use ("ROU") asset and lease liability for all leases. The Company elected the package of transition practical expedients for existing contracts, which allowed us to carry forward our historical assessments of whether contracts are or contain leases, lease classification and determination of initial direct costs. The Company leases property and equipment under finance and operating leases. The Company leases its corporate office space and the space for each of the company-owned or managed clinic in the portfolio. Determining the lease term and amount of lease payments to include in the calculation of the ROU asset and lease liability for leases containing options requires the use of judgment to determine whether the exercise of an option is reasonably certain, and if the optional period and payments should be included in the calculation of the associated ROU asset and liability. In making this determination, all relevant economic factors are considered that would compel the Company to exercise or not exercise an option. When available, the Company uses the rate implicit in the lease to discount lease payments; however, the rate implicit in the lease is not readily determinable for substantially all of its leases. In such cases, the Company estimates its incremental borrowing rate as the interest rate it could borrow an amount equal to the lease payments over a similar term, with similar collateral as in the lease, and in a similar economic environment. The Company estimates these rates using available evidence such as rates imposed by third -party lenders to the Company in recent financings or observable risk-free interest rate and credit spreads for commercial debt of a similar duration, with credit spreads correlating to the Company’s estimated creditworthiness. For operating leases that include rent holidays and rent escalation clauses, the Company recognizes lease expense on a straight-line basis over the lease term from the date it takes possession of the leased property. Pre-opening costs are recorded as incurred in general and administrative expenses. Once a clinic opens, the Company records the straight-line lease expense and any contingent rent, if applicable, in general and administrative expenses on the condensed consolidated statements of operations. Many of the Company’s leases also require it to pay real estate taxes, common area maintenance costs and other occupancy costs which are also included in general and administrative expenses on the condensed consolidated statements of operations. Intangible Assets Intangible assets consist primarily of re-acquired franchise and regional developer rights and customer relationships. The Company amortizes the fair value of re-acquired franchise rights over the remaining contractual terms of the re-acquired franchise rights at the time of the acquisition, which generally range from four to eight years. In the case of regional developer rights, the Company generally amortizes the re-acquired regional developer rights over seven years. The fair value of customer relationships is amortized over their estimated useful life of two years. Goodwill Goodwill consists of the excess of the purchase price over the fair value of tangible and identifiable intangible assets acquired in the acquisitions of franchises. Goodwill and intangible assets deemed to have indefinite lives are not amortized but are subject to annual impairment tests. As required, the Company performs an annual impairment test of goodwill as of the first day of the fourth quarter or more frequently if events or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value. No impairments of goodwill were recorded for the three and six months ended June 30, 2019 and 2018. Long-Lived Assets The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recovered. The Company looks primarily to estimated undiscounted future cash flows in its assessment of whether or not long-lived assets are recoverable. No impairments of long-lived assets were recorded for the three and six months ended June 30, 2019 and 2018. Advertising Fund The Company has established an advertising fund for national/regional marketing and advertising of services offered by its clinics. The monthly marketing fee is 2% of clinic sales. The Company segregates the marketing funds collected which are included in restricted cash on its consolidated balance sheets. As amounts are expended from the fund, the Company recognizes a related expense. Co-Op Marketing Funds Some franchises have established regional Co-Ops for advertising within their local and regional markets. The Company maintains a custodial relationship under which the marketing funds collected are segregated and used for the purposes specified by the Co-Ops’ officers. The marketing funds are included in restricted cash on the Company’s condensed consolidated balance sheets. Revenue Recognition The Company generates revenue primarily through its company-owned and managed clinics, royalties, franchise fees, advertising fund, and through IT related income and computer software fees. Revenues from Company-Owned or Managed Clinics. The Company earns revenues from clinics that it owns and operates or manages throughout the United States. In those states where the Company owns and operates or manages the clinic, revenues are recognized when services are performed. The Company offers a variety of membership and wellness packages which feature discounted pricing as compared with its single-visit pricing. Amounts collected in advance for membership and wellness packages are recorded as deferred revenue and recognized when the service is performed. The Company recognizes a contract liability (or a deferred revenue liability) related to the prepaid treatment plans for which the Company has an ongoing performance obligation. The Company recognizes this contract liability, and recognizes revenue, as the patient consumes his or her visits related to the package and the Company transfers its services. Based on a historical lag analysis, the Company concluded that any remaining contract liability that exists after 24 months from transaction date will be deemed breakage, and only at that point when the likelihood of the patient exercising his or her remaining rights becomes remote will the Company recognize any breakage revenue. Royalties and Advertising Fund Revenue. The Company collects royalties, as stipulated in the franchise agreement, equal to 7% of gross sales, and a marketing and advertising fee currently equal to 2% of gross sales. Royalties, including franchisee contributions to advertising funds, are calculated as a percentage of clinic sales over the term of the franchise agreement. The franchise agreement royalties, inclusive of advertising fund contributions, represent sales-based royalties that are related entirely to the Company’s performance obligation under the franchise agreement and are recognized as franchisee clinic level sales occur. Royalties are collected bi-monthly two working days after each sales period has ended. Franchise Fees. The Company requires the entire non-refundable initial franchise fee to be paid upon execution of a franchise agreement, which typically has an initial term of ten years. Initial franchise fees are recognized ratably on a straight-line basis over the term of the franchise agreement. The Company’s services under the franchise agreement include: training of franchisees and staff, site selection, construction/vendor management and ongoing operations support. The Company provides no financing to franchisees and offers no guarantees on their behalf. The services provided by the Company are highly interrelated with the franchise license and as such are considered to represent a single performance obligation. Software Fees. The Company collects a monthly fee for use of its proprietary chiropractic software, computer support, and internet services support. These fees are recognized ratably on a straight-line basis over the term of the respective franchise agreement. Regional Developer Fees . During 2011, the Company established a regional developer program to engage independent contractors to assist in developing specified geographical regions. Under the historical program, regional developers paid a license fee for each franchise they received the right to develop within the region. In 2017, the program was revised to grant exclusive geographical territory and establish a minimum development obligation within that defined territory. Regional developer fees paid to the Company are non-refundable and are recognized as revenue ratably on a straight-line basis over the term of the regional developer agreement, which is considered to begin upon the execution of the agreement. The Company’s services under regional developer agreements include site selection, grand opening support for the clinics, sales support for identification of qualified franchisees, general operational support and marketing support to advertise for ownership opportunities. The services provided by the Company are highly interrelated with the franchise license and as such are considered to represent a single performance obligation. In addition, regional developers receive fees which are funded by the initial franchise fees collected from franchisees upon the sale of franchises within their exclusive geographical territory and a royalty of 3% of sales generated by franchised clinics in their exclusive geographical territory. Fees related to the sale of franchises within their exclusive geographical territory is initially deferred as deferred franchise costs and are recognized as an expense, in franchise cost of revenues when the respective revenue is recognized, which is generally over the term of the related franchise agreement. Royalty of 3% of sales generated by franchised clinics in their region are recognized as franchise cost of revenues as franchisee clinic level sales occur. The Company entered into one regional developer agreement for the six months ended June 30, 2019 for which it received approximately $290,000 which was deferred as of the transaction date and will be recognized as revenue ratably on a straight-line basis over the term of the regional developer agreement, which is considered to begin upon the execution of the agreement. Certain of these regional developer agreements resulted in the regional developer acquiring the rights to existing royalty streams from clinics already open in the respective territory. In those instances, the revenue associated from the sale of the royalty stream is being recognized over the remaining life of the respective franchise agreements. Advertising Costs Advertising costs are expensed as incurred. Advertising expenses were $656,476 and $1,095,913 for the three and six months ended June 30, 2019, respectively. Advertising expenses were $471,056 and $881,694 for the three and six months ended June 30, 2018, respectively Income Taxes The Company uses an estimated annual effective tax rate method in computing its interim tax provision. This effective tax rate is based on forecasted annual pre-tax income, permanent tax differences and statutory tax rates. Deferred income taxes are recognized for differences between the basis of assets and liabilities for financial statement and income tax purposes. The differences relate principally to depreciation of property and equipment, amortization of goodwill, accounting for leases, and treatment of revenue for franchise fees and regional developer fees collected. Deferred tax assets and liabilities represent the future tax consequence for those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled. Deferred taxes are also recognized for operating losses that are available to offset future taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. The Company accounts for uncertainty in income taxes by recognizing the tax benefit or expense from an uncertain tax position only if it is more likely than not that the tax position will be sustained upon examination by the taxing authorities, based on the technical merits of the position. The Company measures the tax benefits and expenses recognized in the condensed consolidated financial statements from such a position based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate resolution. The Company has not identified any material uncertain tax positions as of June 30, 2019 and December 31, 2018. Interest and penalties associated with tax positions are recorded in the period assessed as general and administrative expenses. The Company's tax returns for tax years subject to examination by tax authorities included 2014 through the current period for state and 2015 through the current period for federal reporting purposes. Earnings (Loss) per Common Share Basic earnings (loss) per common share is computed by dividing the net income (loss) by the weighted-average number of common shares outstanding during the period. Diluted earnings (loss) per common share is computed by giving effect to all potentially dilutive common shares including preferred stock, restricted stock, and stock options. Three Months Ended Six Months Ended June 30, June 30, 2019 2018 2019 2018 (as adjusted) (as adjusted) Net Income (loss) $ 462,260 $ (50,838 ) $ 1,414,905 $ (82,453 ) Weighted average common shares outstanding - basic 13,797,497 13,622,710 13,774,474 13,605,370 Effect of dilutive securities: Unvested restricted stock and stock options 679,510 – 615,845 – Weighted average common shares outstanding - diluted 14,477,007 13,622,710 14,390,320 13,605,370 Basic earnings (loss) per share $ 0.03 $ – $ 0.10 $ (0.01 ) Diluted earnings (loss) per share $ 0.03 $ – $ 0.10 $ (0.01 ) Potentially dilutive securities excluded from the calculation of diluted net income per common share as the effect would be anti-dilutive were as follows: Three Months Ended Six Months Ended June 30, June 30, Weighted average potentially dilutive securities: 2019 2018 2019 2018 Unvested restricted stock – – 2,569 – Stock options – – 41,035 – Stock-Based Compensation The Company accounts for share-based payments by recognizing compensation expense based upon the estimated fair value of the awards on the date of grant. The Company determines the estimated grant-date fair value of restricted shares using quoted market prices and the grant-date fair value of stock options using the Black-Scholes option pricing model. In order to calculate the fair value of the options, certain assumptions are made regarding the components of the model, including the estimated fair value of underlying common stock, risk-free interest rate, volatility, expected dividend yield and expected option life. Changes to the assumptions could cause significant adjustments to the valuation. The Company recognizes compensation costs ratably over the period of service using the straight-line method. Use of Estimates The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. Items subject to significant estimates and assumptions include the allowance for doubtful accounts, share-based compensation arrangements, fair value of stock options, useful lives and realizability of long-lived assets, classification of deferred revenue and revenue recognition related to breakage, classification of deferred franchise costs, calculation of ROU assets and liabilities related to leases, realizability of deferred tax assets, impairment of goodwill and intangible assets and purchase price allocations. Recent Accounting Pronouncements Accounting Standards Adopted Effective January 1, 2019 On January 1, 2019, the Company adopted ASC 842, which requires lessees to recognize a ROU asset and lease liability on their balance sheet for all leases with terms beyond twelve months. The new standard also requires enhanced disclosures that provide more transparency and information to financial statement users about lease portfolios. Effective January 1, 2019, the Company adopted the requirements of ASC 842 using the modified retrospective approach using the optional transition method and elected to apply the provisions of the standard as of the adoption date rather than the earliest date presented. The consolidated financial statements for the period ended June 30, 2019 are presented under the new standard, while comparative periods presented have not been adjusted and continue to be reported in accordance with the previous standard. During the process of adoption, the Company made the following elections: · The Company elected the package of practical expedients which allowed the Company to not reassess: · Whether existing or expired contracts contain leases under the new definition of a lease; · Lease classification for existing or expired leases; and · Initial direct costs for any expired or existing leases to determine if they would qualify for capitalization under ASC 842. · The Company did not elect the hindsight practical expedient, |
Note 2 - Acquisition
Note 2 - Acquisition | 6 Months Ended |
Jun. 30, 2019 | |
Notes to Financial Statements | |
Business Combination Disclosure [Text Block] | Note 2: On April 6, 2018, one second $100,000, $12,998 $87,002 On March 18, 2019, one second $30,000, $3,847 $26,153. Purchase Price Allocation The following summarizes the aggregate estimated fair values of the assets acquired and liabilities assumed during 2019 Property and equipment $ 9,166 Intangible assets 62,000 Total assets acquired 71,166 Deferred revenue (14,305 ) Deferred tax liability (11,410 ) Bargain purchase gain (19,298 ) Net purchase price $ 26,153 Intangible assets in the table above consist of reacquired franchise rights of $30,000 three $32,000 two Pro Forma Results of Operations (Unaudited) The following table summarizes selected unaudited pro forma condensed consolidated statements of operations data for the three six June 30, 2019 2018 2019 January 1, 2018. Pro Forma for the Three Months Ended Pro Forma for the Six Months Ended June 30, 2019 June 30, 2018 June 30, 2019 June 30, 2018 Revenues, net $ 11,169,979 $ 8,863,340 $ 21,894,980 $ 17,633,044 Net income (loss) $ 462,260 $ (90,437 ) $ 1,439,451 $ (207,928 ) This selected unaudited pro forma consolidated financial data is included only for the purpose of illustration and does not not 2018 2019 2018, three June 30, 2019 $73,000 $2,000 six June 30, 2019 $73,000 $13,000 The pro forma amounts included in the table above reflect the application of accounting policies and adjustment of the results of the clinics to reflect the additional depreciation and amortization that would have been charged assuming the fair value adjustments to property and equipment and intangible assets had been applied from January 1, 2018. |
Note 3 - Revenue Disclosures
Note 3 - Revenue Disclosures | 6 Months Ended |
Jun. 30, 2019 | |
Notes to Financial Statements | |
Revenue from Contract with Customer [Text Block] | Note 3: Company-owned or Managed Clinics The Company earns revenues from clinics that it owns and operates or manages throughout the United States. Revenues are recognized when services are performed. The Company offers a variety of membership and wellness packages which feature discounted pricing as compared with its single-visit pricing. Amounts collected in advance for membership and wellness packages are recorded as deferred revenue and recognized when the service is performed or in accordance with the Company’s breakage policy as discussed in Note 1, Revenue Recognition Franchising Fees, Royalty Fees, Advertising Fund Revenue, and Software Fees The Company currently franchises its concept across 33 not not The transaction price in a standard franchise arrangement primarily consists of (a) initial franchise fees; (b) continuing franchise fees (royalties); (c) advertising fees; and (d) software fees. Since the Company considers the licensing of the franchising right to be a single performance obligation, no The Company recognizes the primary components of the transaction price as follows: • Franchise fees are recognized as revenue ratably on a straight-line basis over the term of the franchise agreement commencing with the execution of the franchise agreement. As these fees are typically received in cash at or near the beginning of the franchise term, the cash received is initially recorded as a contract liability until recognized as revenue over time. • The Company is entitled to royalties and advertising fees based on a percentage of the franchisee's gross sales as defined in the franchise agreement. Royalty and advertising revenue are recognized when the franchisee's sales occur. Depending on timing within a fiscal period, the recognition of revenue results in either what is considered a contract asset (unbilled receivable) or, once billed, accounts receivable, on the balance sheet. • The Company is entitled to a software fee, which is charged monthly. The Company recognizes revenue related to software fees ratably on a straight-line basis over the term of the franchise agreement. In determining the amount and timing of revenue from contracts with customers, the Company exercises significant judgment with respect to collectability of the amount; however, the timing of recognition does not none not The Company recognizes advertising fees received under franchise agreements as advertising fund revenue. Regional Developer Fees The Company currently utilizes regional developers to assist in the development of the brand across certain geographic territories. The arrangement is documented in the form of a regional developer agreement. The arrangement between the Company and the regional developer requires the Company to perform various activities to support the brand that do not not The transaction price in a standard regional developer arrangement primarily consists of the initial territory fees. The Company recognizes the regional developer fee as revenue ratably on a straight-line basis over the term of the regional developer agreement commencing with the execution of the regional developer agreement. As these fees are typically received in cash at or near the beginning of the term of the regional developer agreement, the cash received is initially recorded as a contract liability until recognized as revenue over time. Disaggregation of Revenue The Company believes that the captions contained on the condensed consolidated statements of operations appropriately reflect the disaggregation of its revenue by major type for the three six June 30, 2019 2018. Rollforward of Contract Liabilities and Contract Assets Changes in the Company's contract liability for deferred franchise and regional development fees during the six June 30, 2019 Deferred Revenue short and long-term Balance at December 31, 2018 $ 13,609 Recognized as revenue during the six months ended June 30, 2019 (1,249 ) Fees received and deferred during the six months ended June 30, 2019 2,990 Balance at June 30, 2019 $ 15,350 Changes in the Company's contract assets for deferred franchise costs during the six June 30, 2019 Deferred Franchise Costs short and long-term Balance at December 31, 2018 $ 3,489 Recognized as cost of revenue during the six months ended June 30, 2019 (325 ) Costs incurred and deferred during the six months ended June 30, 2019 1,032 Balance at June 30, 2019 $ 4,196 The following table illustrates estimated revenues expected to be recognized in the future related to performance obligations that were unsatisfied (or partially unsatisfied) as of June 30, 2019 ( Contract liabilities expected to be recognized in Amount 2019 (remainder) $ 1,356 2020 2,694 2021 2,572 2022 2,150 2023 1,788 Thereafter 4,790 Total $ 15,350 |
Note 4 - Restricted Cash
Note 4 - Restricted Cash | 6 Months Ended |
Jun. 30, 2019 | |
Notes to Financial Statements | |
Restricted Cash [Text Block] | Note 4. The table below reconciles the cash and cash equivalents balance and restricted cash balances from The Company’s condensed consolidated balance sheet to the amount of cash reported on the condensed consolidated statement of cash flows: June 30, December 31, 2019 2018 Cash and cash equivalents $ 9,485,212 $ 8,716,874 Restricted cash 129,220 138,078 Total cash, cash equivalents and restricted cash $ 9,614,432 $ 8,854,952 |
Note 5 - Notes Receivable
Note 5 - Notes Receivable | 6 Months Ended |
Jun. 30, 2019 | |
Notes to Financial Statements | |
Loans, Notes, Trade and Other Receivables Disclosure [Text Block] | Note 5: Effective April 29, 2017, $320,000, $187,000 10% 42 36 November 1, 2017 October 1, 2020. Effective August 31, 2017, $220,000, $117,475 10% 36 36 September 1, 2017 August 1, 2020. Effective September 22, 2017, $228,293, $119,147 10% 36 36 October 1, 2017 September 1, 2020. September 28, 2018. Effective October 10, 2017, $170,000, $135,688 10% 36 36 October 24, 2020. Effective April 26, 2019, $31,086. 0% 36 36 May 15, 2019 May 15, 2022. The net outstanding balances of the notes as of June 30, 2019 December 31, 2018 $235,343 $278,072, June 30, 2019 2019 (remaining) $ 79,534 2020 137,123 2021 9,600 2022 9,086 Total $ 235,343 |
Note 6 - Property and Equipment
Note 6 - Property and Equipment | 6 Months Ended |
Jun. 30, 2019 | |
Notes to Financial Statements | |
Property, Plant and Equipment Disclosure [Text Block] | Note 6: Property and equipment consist of the following: June 30, December 31, 2019 2018 Office and computer equipment $ 1,373,775 $ 1,243,104 Leasehold improvements 5,784,728 5,407,915 Software developed 1,193,007 1,145,742 Finance lease assets 80,604 – 8,432,114 7,796,761 Accumulated depreciation and amortization (5,256,290 ) (4,909,002 ) 3,175,824 2,887,759 Construction in progress 1,787,213 770,248 Property and equipment, net $ 4,963,037 $ 3,658,007 Depreciation expense was $206,609 $400,415 three six June 30, 2019, $284,265 $548,618 three six June 30, 2018, Amortization expense related to finance lease assets was $6,169 $12,337 three six June 30, 2019, Construction in progress at June 30, 2019 December 31, 2018 |
Note 7 - Fair Value Considerati
Note 7 - Fair Value Consideration | 6 Months Ended |
Jun. 30, 2019 | |
Notes to Financial Statements | |
Fair Value Disclosures [Text Block] | Note 7: The Company’s financial instruments include cash, restricted cash, accounts receivable, notes receivable, accounts payable, accrued expenses and notes payable. The carrying amounts of its financial instruments approximate their fair value due to their short maturities. The Company does not Authoritative guidance 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 measurement date. The guidance establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability, developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions of what market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is broken down into three Level 1: Observable inputs such as quoted prices in active markets; Level 2: Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and Level 3: Unobservable inputs in which there is little or no As of June 30, 2019, December 31, 2018, not 1, 2 3. The intangible assets resulting from the acquisition (reference Note 2 3 |
Note 8 - Intangible Assets
Note 8 - Intangible Assets | 6 Months Ended |
Jun. 30, 2019 | |
Notes to Financial Statements | |
Intangible Assets Disclosure [Text Block] | Note 8: On February 4, 2019, $681,500. The Company carried a deferred revenue balance associated with these transactions of $44,334, Intangible assets consist of the following: As of June 30, 2019 Gross Carrying Accumulated Net Carrying Amount Amortization Value Intangible assets subject to amortization: Reacquired franchise rights $ 1,788,000 $ (1,058,822 ) $ 729,178 Customer relationships 777,000 (733,828 ) 43,172 Reacquired development rights 2,050,482 (846,997 ) 1,203,485 $ 4,615,482 $ (2,639,647 ) $ 1,975,835 As of December 31, 2018 Gross Carrying Accumulated Net Carrying Amount Amortization Value Intangible assets subject to amortization: Reacquired franchise rights $ 1,758,000 $ (921,138 ) $ 836,862 Customer relationships 745,000 (717,498 ) 27,502 Reacquired development rights 1,413,316 (643,620 ) 769,696 $ 3,916,316 $ (2,282,256 ) $ 1,634,060 Amortization expense related to the Company’s intangible assets was $191,688 $357,391 three six June 30, 2019, $120,710 $243,774 three six June 30, 2018, Estimated amortization expense for 2019 2019 (remainder) $ 379,140 2020 741,790 2021 657,850 2022 184,842 2023 12,213 Total $ 1,975,835 |
Note 9 - Debt
Note 9 - Debt | 6 Months Ended |
Jun. 30, 2019 | |
Notes to Financial Statements | |
Debt Disclosure [Text Block] | Note 9: Notes Payable During 2016, two $186,000 4.25% May 2017. December 31, 2018, one $100,000 February 2019. Credit and Security Agreement On January 3, 2017, $5,000,000 10% $200,000. not $25,000. December 2019, June 30, 2019, $1,000,000 $5,000,000 As of June 30, 2019, |
Note 10 - Stock-based Compensat
Note 10 - Stock-based Compensation | 6 Months Ended |
Jun. 30, 2019 | |
Notes to Financial Statements | |
Stockholders' Equity Note Disclosure [Text Block] | Note 10: Stock Options During the six June 30, 2019, 62,944 $12.02. The Company’s stock trading price on the date of grant is the basis of fair value of its common stock used in determining the value of share-based awards. To the extent the value of the Company’s share-based awards involves a measure of volatility, the Company relied on the volatilities from publicly traded companies with similar business models as its common stock lacked enough trading history for it to utilize its own historical volatility. For future grants, the Company plans to use historical volatility of the Company’s common stock over a period of time corresponding to the expected stock option term. The Company uses the simplified method to calculate the expected term of stock option grants to employees as the Company does not four ten The Company has computed the fair value of all options granted during the six June 30, 2019 2018, Six Months Ended June 30, 2019 2018 Expected volatility 35% 42% - 43% Expected dividends None None Expected term (years) 7 7 Risk-free rate 2.61% 2.53% to 2.63% Forfeiture rate 20% 20% The information below summarizes the stock options activity: Weighted Weighted Weighted Average Average Average Remaining Number of Exercise Fair Contractual Life Shares Price Value (Years) Outstanding at December 31, 2017 1,003,916 $ 4.18 $ 1.87 8.1 Granted 145,792 7.00 Exercised (95,162 ) 3.48 Cancelled (67,855 ) 3.37 Outstanding at December 31, 2018 986,691 $ 4.72 $ 2.09 6.8 Granted 62,944 12.02 Exercised (47,804 ) 5.01 Cancelled – – Outstanding at June 30, 2019 1,001,831 $ 5.17 $ 2.25 6.2 Exercisable at June 30, 2019 541,238 $ 4.61 $ 2.01 6.2 The aggregate intrinsic value of the Company’s stock options outstanding and expected to vest was $11,894,226 June 30, 2019. The aggregate intrinsic value of the Company’s stock options exercisable was $7,354,410 June 30, 2019. For the three six June 30, 2019, $99,846 $196,650, three six June 30, 2018, $69,640 $208,813, June 30, 2019 $920,988, 2.8 Restricted Stock Restricted stocks granted to employees generally vest in four one The information below summaries the restricted stock activity: Restricted Stock Awards Shares Non-vested at December 31, 2018 51,134 Granted 26,131 Vested (33,012 ) Cancelled – Non-vested at June 30, 2019 44,253 For the three six June 30, 2019, $79,106 $154,074, three six June 30, 2018, $69,347 $137,816, Unrecognized stock-based compensation expense for restricted stock awards as of June 30, 2019 $469,307, 2.2 |
Note 11 - Income Taxes
Note 11 - Income Taxes | 6 Months Ended |
Jun. 30, 2019 | |
Notes to Financial Statements | |
Income Tax Disclosure [Text Block] | Note 11: During the three six June 30, 2019, $10,000 $9,000, During the three six June 30, 2018, $6,000 $57,000, |
Note 12 - Related Party Transac
Note 12 - Related Party Transactions | 6 Months Ended |
Jun. 30, 2019 | |
Notes to Financial Statements | |
Related Party Transactions Disclosure [Text Block] | Note 12: The Company entered into a legal agreement with a certain common stockholder related to services performed for the operations and transaction related activities of the Company. Amounts paid to or for the benefit of this stockholder was approximately $98,000 $181,000 three six June 30, 2019, $68,000 $116,000 three six June 30, 2018, |
Note 13 - Commitments and Conti
Note 13 - Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2019 | |
Notes to Financial Statements | |
Commitments and Contingencies Disclosure [Text Block] | Note 13: Leases The table below summarizes the components of lease expense and income statement location for the three six June 30, 2019: Line Item in the Company’s Consolidated Three Months Ended Six Months Ended Finance lease costs: Amortization of assets Depreciation and amortization $ 6,169 $ 12,337 Interest on lease liabilities Other income (expense), net 1,778 3,689 Total finance lease costs 7,947 16,026 Operating lease costs General and administrative expenses $ 706,368 $ 1,394,100 Total lease costs $ 714,315 $ 1,410,126 Supplemental information and balance sheet location related to leases is as follows: June 30, 2019 Operating Leases: Operating lease right-of -use asset $ 10,030,737 Operating lease liability - current portion $ 1,827,233 Operating lease liability - net of current portion 9,049,948 Total operating lease liability $ 10,877,181 Finance Leases: Property and equipment, at cost $ 80,604 Less accumulated amortization (12,337 ) Property and equipment, net $ 68,267 Finance lease liability - current portion $ 23,075 Finance lease liability - net of current portion 46,826 Total finance lease liabilities $ 69,901 Weighted average remaining lease term (in years): Operating leases 5.71 Finance lease 2.77 Weighted average discount rate: Operating leases 9.20 % Finance leases 10.00 % Supplemental cash flow information related to leases is as follows: Six Months Ended Cash paid for amounts included in measurement of liabilities: Operating cash flows from operating leases $ 1,469,684 Operating cash flows from finance leases 3,689 Financing cash flows from finance leases 10,704 Non-cash transactions: ROU assets obtained in exchange for lease liabilities Operating lease $ 400,980 Finance lease 80,604 Maturities of lease liabilities as of June 30, 2019 Operating Leases Finance Lease 2019 (remainder) $ 1,372,050 $ 14,393 2020 2,642,993 28,786 2021 2,545,456 28,786 2022 2,454,666 7,676 2023 1,776,161 – Thereafter 3,180,176 – Total lease payments $ 13,971,502 $ 79,641 Less: Imputed interest (3,094,321 ) (9,740 ) Total lease obligations 10,877,181 69,901 Less: Current obligations (1,827,233 ) (23,075 ) Long-term lease obligation $ 9,049,948 $ 46,826 The future minimum obligations under operating leases in effect as of December 31, 2018 one 842 Operating Leases 2019 $ 2,630,443 2020 2,406,645 2021 2,299,887 2022 2,195,077 2023 1,474,396 Thereafter 2,772,575 Total lease payments $ 13,779,023 In May 2019, not $2.1 fourth 2019, six Litigation In the normal course of business, the Company is party to litigation from time to time. The Company maintains insurance to cover certain actions and believes that resolution of such litigation will not |
Note 14 - Segment Reporting
Note 14 - Segment Reporting | 6 Months Ended |
Jun. 30, 2019 | |
Notes to Financial Statements | |
Segment Reporting Disclosure [Text Block] | Note 14: An operating segment is defined as a component of an enterprise for which discrete financial information is available and is reviewed regularly by the Chief Operating Decision Maker (“CODM”) to evaluate performance and make operating decisions. The Company has identified its CODM as the Chief Executive Officer. The Company has two June 30, 2019, 51 June 30, 2019, 417 two The tables below present financial information for the Company’s two Three Months Ended Six Months Ended June 30, June 30, 2019 2018 2019 2018 (as adjusted) (as adjusted) Revenues: Corporate clinics $ 5,777 $ 4,669 $ 11,416 $ 9,474 Franchise operations 5,393 4,136 10,433 7,978 Total revenues $ 11,170 $ 8,805 $ 21,849 $ 17,452 Segment operating income (loss): Corporate clinics $ 564 $ (50 ) $ 1,404 $ 416 Franchise operations 2,631 1,974 5,020 3,789 Total segment operating income (loss) $ 3,195 $ 1,924 $ 6,424 $ 4,205 Depreciation and amortization: Corporate clinics $ 353 $ 245 $ 666 $ 548 Franchise operations - - - - Corporate administration 51 160 104 244 Total depreciation and amortization $ 404 $ 405 $ 770 $ 792 Reconciliation of total segment operating income (loss) to consolidated earnings (loss) before income taxes (in thousands): Total segment operating income (loss) $ 3,195 $ 1,924 $ 6,424 $ 4,205 Unallocated corporate (2,707 ) (1,988 ) (4,993 ) (4,353 ) Consolidated income (loss) from operations 488 (64 ) 1,431 (148 ) Bargain purchase gain - 30 19 30 Other income (expense), net (15 ) (11 ) (26 ) (22 ) Income (loss) before income tax expense $ 473 $ (45 ) $ 1,424 $ (140 ) June 30, December 31, 2019 2018 Segment assets: (as adjusted) Corporate clinics $ 19,249 $ 8,828 Franchise operations 5,181 4,455 Total segment assets $ 24,430 $ 13,283 Unallocated cash and cash equivalents and restricted cash $ 9,614 $ 8,855 Unallocated property and equipment 1,551 487 Other unallocated assets 874 803 Total assets $ 36,469 $ 23,428 “Unallocated cash and cash equivalents and restricted cash” relates primarily to corporate cash and cash equivalents and restricted cash (see Note 1 |
Note 15 - Subsequent Events
Note 15 - Subsequent Events | 6 Months Ended |
Jun. 30, 2019 | |
Notes to Financial Statements | |
Subsequent Events [Text Block] | Note 15: In July August 2019, five $2.8 four 8 75 |
Significant Accounting Policies
Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Basis of Accounting, Policy [Policy Text Block] | Basis of Presentation These unaudited financial statements represent the condensed consolidated financial statements of The Joint Corp. (“The Joint”), its variable interest entities (“VIEs”), and its wholly owned subsidiary, The Joint Corporate Unit No. 1, 10 prior period financial statement correction of immaterial error June 30, 2019 2018 not June 30, 2019 2018 The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amount of assets, liabilities, revenue, costs, expenses and other (expenses) income that are reported in the condensed consolidated financial statements and accompanying disclosures. These estimates are based on management’s best knowledge of current events, historical experience, actions that the Company may may 3, Revenue Disclosures 13 , Commitments and Contingencies . |
Reclassification, Policy [Policy Text Block] | Prior Period Financial Statement Correction of Immaterial Error Certain states, in which the Company manages clinics, regulate the practice of chiropractic care and require that chiropractic services be provided by legal entities organized under state laws as professional corporations or PCs. The PCs are VIEs as defined by Accounting Standards Codification 810, 810” first 2019, 810. 810, 2019, not not no 2018 The immaterial impacts of this error correction in the three six June 30, 2018 December 31, 2018 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) Three Months Ended Adjustments Due To Three Months Ended June 30, 2018 VIE Consolidation June 30, 2018 (as reported) (as adjusted) Revenues: Revenues from company-owned or managed clinics $ 3,420,685 1,247,953 $ 4,668,638 Total revenues 7,556,832 1,247,953 8,804,785 General and administrative expenses 4,656,308 1,211,204 5,867,512 Total selling, general and administrative expenses 6,354,946 1,211,204 7,566,150 Loss from operations (100,402 ) 36,163 (64,239 ) Other income (expense): Bargain purchase gain 75,264 (44,809 ) 30,455 Total other income 63,575 (44,223 ) 19,352 Loss before income tax expense (36,827 ) (8,060 ) (44,887 ) Net loss and comprehensive loss $ (42,778 ) (8,060 ) $ (50,838 ) CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) Six Months Ended Adjustments Due To Six Months Ended June 30, 2018 VIE Consolidation June 30, 2018 (as reported) (as adjusted) Revenues: Revenues from company-owned or managed clinics $ 6,677,309 2,797,002 $ 9,474,311 Total revenues 14,654,747 2,797,002 17,451,749 General and administrative expenses 9,731,234 2,404,964 12,136,198 Total selling, general and administrative expenses 12,919,593 2,404,964 15,324,557 Loss from operations (539,466 ) 391,064 (148,402 ) Other income (expense): Bargain purchase gain 75,264 (44,809 ) 30,455 Total other income 52,380 (43,835 ) 8,545 Loss before income tax expense (487,086 ) 347,229 (139,857 ) Net loss and comprehensive loss $ (429,682 ) 347,229 $ (82,453 ) Loss per share: Basic and diluted loss per share $ (0.03 ) 0.02 $ (0.01 ) Basic and diluted weighted average shares 13,605,370 - 13,605,370 THE JOINT CORP. AND SUBSIDIARY AND AFFILIATES CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) December 31, Adjustments Due To December 31, 2018 VIE Consolidation 2018 ASSETS (as reported) (as adjusted) Current assets: Accounts receivable, net 1,213,707 (407,357 ) 806,350 Total current assets 11,711,345 (407,357 ) 11,303,988 Goodwill 2,916,426 308,719 3,225,145 Total assets $ 23,526,352 $ (98,639 ) $ 23,427,713 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Deferred revenue from company clinics 994,493 1,535,004 2,529,497 Total current liabilities 8,738,123 1,535,004 10,273,127 Total liabilities 21,165,108 1,535,004 22,700,112 Commitments and contingencies Equity: The Joint Corp. stockholders' equity: Accumulated deficit (35,750,908 ) (1,633,743 ) (37,384,651 ) Total The Joint Corp. stockholders' equity 2,361,244 (1,633,743 ) 727,501 Non-controlling Interest - 100 100 Total equity 2,361,244 (1,633,643 ) 727,601 Total liabilities and equity $ 23,526,352 $ (98,639 ) $ 23,427,713 |
Consolidation, Policy [Policy Text Block] | Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of The Joint Corp. and its wholly owned subsidiary, The Joint Corporate Unit No. 1, 810. third All significant inter-affiliate accounts and transactions between The Joint Corp. and its VIEs have been eliminated in consolidation. Certain balances were reclassified from regional developer fees to other revenues for the three six June 30, 2018 |
Comprehensive Income, Policy [Policy Text Block] | Comprehensive Income (Loss) Net income (loss) and comprehensive income (loss) are the same for the three six June 30, 2019 2018. |
Nature of Operations Policy [Policy Text Block] | <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic;">Nature of Operations</div></div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in">The Joint, a Delaware corporation, was formed on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 10, 2010 </div>for the principal purpose of franchising, developing and managing chiropractic clinics, selling regional developer rights and supporting the operations of franchised chiropractic clinics at locations throughout the United States of America. The franchising of chiropractic clinics is regulated by the Federal Trade Commission and various state authorities. </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in">The following table summarizes the number of clinics in operation under franchise agreements and as company-owned or managed clinics for the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">six</div> months ended <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> June 30, 2019 </div>and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2018:</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in"></div> <div> <table style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif; min-width: 700px;" cellspacing="0" cellpadding="0"> <tr style="vertical-align: bottom"> <td style="white-space: nowrap; text-align: right"> </td> <td style="font-weight: bold"> </td> <td colspan="7" style="white-space: nowrap; font-weight: bold; text-align: center">Three Months Ended</td> <td style="font-weight: bold"> </td> <td colspan="7" style="white-space: nowrap; font-weight: bold; text-align: center">Six Months Ended</td> </tr> <tr style="vertical-align: bottom"> <td style="white-space: nowrap; text-align: right"> </td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="7" style="white-space: nowrap; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">June 30,</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="7" style="white-space: nowrap; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">June 30,</td> </tr> <tr style="vertical-align: bottom"> <td style="white-space: nowrap; font-weight: bold">Franchised clinics:</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="white-space: nowrap; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2019</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="white-space: nowrap; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2018</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="white-space: nowrap; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2019</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="white-space: nowrap; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2018</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 40%; text-align: left; padding-left: 10pt">Clinics open at beginning of period</td> <td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 11%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">404</div></td> <td style="white-space: nowrap; width: 1%; text-align: left"> </td> <td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 11%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">359</div></td> <td style="white-space: nowrap; width: 1%; text-align: left"> </td> <td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 11%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">394</div></td> <td style="white-space: nowrap; width: 1%; text-align: left"> </td> <td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 11%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">352</div></td> <td style="white-space: nowrap; width: 1%; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-left: 20pt">Opened or Purchased during the period</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">14</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">8</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">26</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15</div></td> <td style="white-space: nowrap; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-left: 20pt">Acquired or sold during the period</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(1</div></td> <td style="white-space: nowrap; text-align: left">)</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(1</div></td> <td style="white-space: nowrap; text-align: left">)</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(1</div></td> <td style="white-space: nowrap; text-align: left">)</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1pt; padding-left: 20pt">Closed during the period</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(1</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left">)</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(1</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left">)</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(2</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left">)</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(1</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left">)</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 1pt; padding-left: 10pt">Clinics in operation at the end of the period</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">417</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">365</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">417</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">365</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left"> </td> </tr> </table> </div> <div style=" margin: 0"> </div> <div> <table style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif; min-width: 700px;" cellspacing="0" cellpadding="0"> <tr style="vertical-align: bottom"> <td style="white-space: nowrap; text-align: right"> </td> <td style="font-weight: bold"> </td> <td colspan="7" style="white-space: nowrap; font-weight: bold; text-align: center">Three Months Ended</td> <td style="font-weight: bold"> </td> <td colspan="7" style="white-space: nowrap; font-weight: bold; text-align: center">Six Months Ended</td> </tr> <tr style="vertical-align: bottom"> <td style="white-space: nowrap; text-align: right"> </td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="7" style="white-space: nowrap; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">June 30,</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="7" style="white-space: nowrap; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">June 30,</td> </tr> <tr style="vertical-align: bottom"> <td style="white-space: nowrap; font-weight: bold">Company-owned or managed clinics:</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="white-space: nowrap; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2019</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="white-space: nowrap; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2018</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="white-space: nowrap; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2019</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="white-space: nowrap; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2018</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 40%; text-align: left; padding-left: 10pt">Clinics open at beginning of period</td> <td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 11%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">50</div></td> <td style="white-space: nowrap; width: 1%; text-align: left"> </td> <td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 11%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">47</div></td> <td style="white-space: nowrap; width: 1%; text-align: left"> </td> <td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 11%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">48</div></td> <td style="white-space: nowrap; width: 1%; text-align: left"> </td> <td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 11%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">47</div></td> <td style="white-space: nowrap; width: 1%; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-left: 20pt">Opened during the period</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="white-space: nowrap; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-left: 20pt">Acquired during the period</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1</div></td> <td style="white-space: nowrap; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1pt; padding-left: 20pt">Closed or Sold during the period</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(1</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left">)</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 1pt; padding-left: 10pt">Clinics in operation at the end of the period</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">51</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">48</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">51</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">48</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: right"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="white-space: nowrap; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 2.5pt">Total clinics in operation at the end of the period</td> <td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="border-bottom: Black 2.5pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">468</div></td> <td style="white-space: nowrap; border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="border-bottom: Black 2.5pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">413</div></td> <td style="white-space: nowrap; border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="border-bottom: Black 2.5pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">468</div></td> <td style="white-space: nowrap; border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="border-bottom: Black 2.5pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">413</div></td> <td style="white-space: nowrap; border-bottom: Black 2.5pt double; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: right"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="white-space: nowrap; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Clinic licenses sold but not yet developed</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">176</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">117</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">176</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">117</div></td> <td style="white-space: nowrap; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Executed letters of intent for future clinic licenses</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">28</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">9</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">28</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">9</div></td> <td style="white-space: nowrap; text-align: left"> </td> </tr> </table> </div></div></div>" id="sjs-B8"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic;">Nature of Operations</div></div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in">The Joint, a Delaware corporation, was formed on <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> March 10, 2010 </div>for the principal purpose of franchising, developing and managing chiropractic clinics, selling regional developer rights and supporting the operations of franchised chiropractic clinics at locations throughout the United States of America. The franchising of chiropractic clinics is regulated by the Federal Trade Commission and various state authorities. </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in">The following table summarizes the number of clinics in operation under franchise agreements and as company-owned or managed clinics for the <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">three</div> and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">six</div> months ended <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;"> June 30, 2019 </div>and <div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">2018:</div></div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in"> </div> <div style=" font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in"></div> <div> <table style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif; min-width: 700px;" cellspacing="0" cellpadding="0"> <tr style="vertical-align: bottom"> <td style="white-space: nowrap; text-align: right"> </td> <td style="font-weight: bold"> </td> <td colspan="7" style="white-space: nowrap; font-weight: bold; text-align: center">Three Months Ended</td> <td style="font-weight: bold"> </td> <td colspan="7" style="white-space: nowrap; font-weight: bold; text-align: center">Six Months Ended</td> </tr> <tr style="vertical-align: bottom"> <td style="white-space: nowrap; text-align: right"> </td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="7" style="white-space: nowrap; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">June 30,</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="7" style="white-space: nowrap; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">June 30,</td> </tr> <tr style="vertical-align: bottom"> <td style="white-space: nowrap; font-weight: bold">Franchised clinics:</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="white-space: nowrap; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2019</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="white-space: nowrap; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2018</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="white-space: nowrap; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2019</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="white-space: nowrap; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2018</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 40%; text-align: left; padding-left: 10pt">Clinics open at beginning of period</td> <td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 11%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">404</div></td> <td style="white-space: nowrap; width: 1%; text-align: left"> </td> <td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 11%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">359</div></td> <td style="white-space: nowrap; width: 1%; text-align: left"> </td> <td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 11%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">394</div></td> <td style="white-space: nowrap; width: 1%; text-align: left"> </td> <td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 11%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">352</div></td> <td style="white-space: nowrap; width: 1%; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-left: 20pt">Opened or Purchased during the period</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">14</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">8</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">26</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">15</div></td> <td style="white-space: nowrap; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-left: 20pt">Acquired or sold during the period</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(1</div></td> <td style="white-space: nowrap; text-align: left">)</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(1</div></td> <td style="white-space: nowrap; text-align: left">)</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(1</div></td> <td style="white-space: nowrap; text-align: left">)</td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1pt; padding-left: 20pt">Closed during the period</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(1</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left">)</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(1</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left">)</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(2</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left">)</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(1</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left">)</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 1pt; padding-left: 10pt">Clinics in operation at the end of the period</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">417</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">365</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">417</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">365</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left"> </td> </tr> </table> </div> <div style=" margin: 0"> </div> <div> <table style="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif; min-width: 700px;" cellspacing="0" cellpadding="0"> <tr style="vertical-align: bottom"> <td style="white-space: nowrap; text-align: right"> </td> <td style="font-weight: bold"> </td> <td colspan="7" style="white-space: nowrap; font-weight: bold; text-align: center">Three Months Ended</td> <td style="font-weight: bold"> </td> <td colspan="7" style="white-space: nowrap; font-weight: bold; text-align: center">Six Months Ended</td> </tr> <tr style="vertical-align: bottom"> <td style="white-space: nowrap; text-align: right"> </td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="7" style="white-space: nowrap; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">June 30,</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="7" style="white-space: nowrap; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">June 30,</td> </tr> <tr style="vertical-align: bottom"> <td style="white-space: nowrap; font-weight: bold">Company-owned or managed clinics:</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="white-space: nowrap; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2019</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="white-space: nowrap; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2018</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="white-space: nowrap; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2019</td> <td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="white-space: nowrap; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2018</td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 40%; text-align: left; padding-left: 10pt">Clinics open at beginning of period</td> <td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 11%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">50</div></td> <td style="white-space: nowrap; width: 1%; text-align: left"> </td> <td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 11%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">47</div></td> <td style="white-space: nowrap; width: 1%; text-align: left"> </td> <td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 11%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">48</div></td> <td style="white-space: nowrap; width: 1%; text-align: left"> </td> <td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 11%; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">47</div></td> <td style="white-space: nowrap; width: 1%; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-left: 20pt">Opened during the period</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">3</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="white-space: nowrap; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-left: 20pt">Acquired during the period</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">1</div></td> <td style="white-space: nowrap; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1pt; padding-left: 20pt">Closed or Sold during the period</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">(1</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left">)</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">–</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 1pt; padding-left: 10pt">Clinics in operation at the end of the period</td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">51</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">48</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">51</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left"> </td> <td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td> <td style="border-bottom: Black 1pt solid; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">48</div></td> <td style="white-space: nowrap; border-bottom: Black 1pt solid; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: right"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="white-space: nowrap; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 2.5pt">Total clinics in operation at the end of the period</td> <td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="border-bottom: Black 2.5pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">468</div></td> <td style="white-space: nowrap; border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="border-bottom: Black 2.5pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">413</div></td> <td style="white-space: nowrap; border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="border-bottom: Black 2.5pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">468</div></td> <td style="white-space: nowrap; border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td> <td style="border-bottom: Black 2.5pt double; text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">413</div></td> <td style="white-space: nowrap; border-bottom: Black 2.5pt double; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: right"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="white-space: nowrap; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Clinic licenses sold but not yet developed</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">176</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">117</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">176</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">117</div></td> <td style="white-space: nowrap; text-align: left"> </td> </tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Executed letters of intent for future clinic licenses</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">28</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">9</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">28</div></td> <td style="white-space: nowrap; text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"><div style="display: inline; font-style: italic; font-weight: inherit; font-style: normal;">9</div></td> <td style="white-space: nowrap; text-align: left"> </td> </tr> </table> </div></div></div> |
Consolidation, Variable Interest Entity, Policy [Policy Text Block] | Variable Interest Entities An entity deemed to hold the controlling interest in a voting interest entity or deemed to be the primary beneficiary of a VIE is required to consolidate the VIE in its financial statements. An entity is deemed to be the primary beneficiary of a VIE if it has both of the following characteristics: (a) the power to direct the activities of a VIE that most significantly impact the VIE's economic performance and (b) the obligation to absorb the majority of losses of the VIE or the right to receive the majority of benefits from the VIE. Certain states, in which the Company manages clinics, regulate the practice of chiropractic care and require that chiropractic services be provided by legal entities organized under state laws as professional corporations or PCs. Such PCs are VIEs, as fees paid by the PC to the Company as its management service provider are considered variable interests because they are liabilities on the PC’s books and the fees do not 1 2 not 3 first 2019, 810, 810, June 30, 2019. |
Cash and Cash Equivalents, Policy [Policy Text Block] | Cash and Cash Equivalents The Company considers all highly liquid instruments purchased with an original maturity of three no June 30, 2019 December 31, 2018. |
Cash and Cash Equivalents, Restricted Cash and Cash Equivalents, Policy [Policy Text Block] | Restricted Cash Restricted cash relates to cash that franchisees and company-owned or managed clinics contribute to the Company’s National Marketing Fund and cash that franchisees provide to various voluntary regional Co-Op Marketing Funds. Cash contributed by franchisees to the National Marketing Fund is to be used in accordance with the Company’s Franchise Disclosure Document with a focus on regional and national marketing and advertising. |
Accounts Receivable [Policy Text Block] | Accounts Receivable Accounts receivable represent amounts due from franchisees for initial franchise fees and royalty fees. The Company considers a reserve for doubtful accounts based on the creditworthiness of the entity. The provision for uncollectible amounts is continually reviewed and adjusted to maintain the allowance at a level considered adequate to cover future losses. The allowance is management’s best estimate of uncollectible amounts and is determined based on specific identification and historical performance that the Company tracks on an ongoing basis. Actual losses ultimately could differ materially in the near term from the amounts estimated in determining the allowance. As of June 30, 2019, December 31, 2018, $0. |
Deferred Charges, Policy [Policy Text Block] | Deferred Franchise Costs Deferred franchise costs represent commissions that are direct and incremental to the Company and are paid in conjunction with the sale of a franchise. These costs are recognized as an expense, in franchise cost of revenues when the respective revenue is recognized, which is generally over the term of the related franchise agreement. |
Property, Plant and Equipment, Policy [Policy Text Block] | Property and Equipment Property and equipment are stated at cost or for property acquired as part of franchise acquisitions at fair value at the date of closing. Depreciation is computed using the straight-line method over estimated useful lives of three seven Maintenance and repairs are charged to expense as incurred; major renewals and improvements are capitalized. When items of property or equipment are sold or retired, the related cost and accumulated depreciation are removed from the accounts and any gain or loss is included in income. |
Internal Use Software, Policy [Policy Text Block] | Capitalized Software The Company capitalizes certain software development costs. These capitalized costs are primarily related to software used by clinics for operations and by the Company for the management of operations. Costs incurred in the preliminary stages of development are expensed as incurred. Once an application has reached the development stage, internal and external costs, if direct, are capitalized as assets in progress until the software is substantially complete and ready for its intended use. Capitalization ceases upon completion of all substantial testing. The Company also capitalizes costs related to specific upgrades and enhancements when it is probable the expenditures will result in additional functionality. Software developed is recorded as part of property and equipment. Maintenance and training costs are expensed as incurred. Internal use software is amortized on a straight-line basis over its estimated useful life, generally five |
Lessee, Leases [Policy Text Block] | Leases The Company adopted the guidance of Accounting Standards Codification 842 842” January 1, 2019 The Company leases property and equipment under finance and operating leases. The Company leases its corporate office space and the space for each of the company-owned or managed clinic in the portfolio. Determining the lease term and amount of lease payments to include in the calculation of the ROU asset and lease liability for leases containing options requires the use of judgment to determine whether the exercise of an option is reasonably certain, and if the optional period and payments should be included in the calculation of the associated ROU asset and liability. In making this determination, all relevant economic factors are considered that would compel the Company to exercise or not not third For operating leases that include rent holidays and rent escalation clauses, the Company recognizes lease expense on a straight-line basis over the lease term from the date it takes possession of the leased property. Pre-opening costs are recorded as incurred in general and administrative expenses. Once a clinic opens, the Company records the straight-line lease expense and any contingent rent, if applicable, in general and administrative expenses on the condensed consolidated statements of operations. Many of the Company’s leases also require it to pay real estate taxes, common area maintenance costs and other occupancy costs which are also included in general and administrative expenses on the condensed consolidated statements of operations. |
Intangible Assets, Finite-Lived, Policy [Policy Text Block] | Intangible Assets Intangible assets consist primarily of re-acquired franchise and regional developer rights and customer relationships. The Company amortizes the fair value of re-acquired franchise rights over the remaining contractual terms of the re-acquired franchise rights at the time of the acquisition, which generally range from four eight seven two |
Goodwill and Intangible Assets, Goodwill, Policy [Policy Text Block] | Goodwill Goodwill consists of the excess of the purchase price over the fair value of tangible and identifiable intangible assets acquired in the acquisitions of franchises. Goodwill and intangible assets deemed to have indefinite lives are not first fourth not No three six June 30, 2019 2018. |
Impairment or Disposal of Long-Lived Assets, Policy [Policy Text Block] | Long-Lived Assets The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not not No three six June 30, 2019 2018. |
Advertising Fund, Policy [Policy Text Block] | Advertising Fund The Company has established an advertising fund for national/regional marketing and advertising of services offered by its clinics. The monthly marketing fee is 2% |
Co-Op Marketing Funds, Policy [Policy Text Block] | Co-Op Marketing Funds Some franchises have established regional Co-Ops for advertising within their local and regional markets. The Company maintains a custodial relationship under which the marketing funds collected are segregated and used for the purposes specified by the Co-Ops’ officers. The marketing funds are included in restricted cash on the Company’s condensed consolidated balance sheets. |
Revenue from Contract with Customer [Policy Text Block] | Revenue Recognition The Company generates revenue primarily through its company-owned and managed clinics, royalties, franchise fees, advertising fund, and through IT related income and computer software fees. Revenues from Company-Owned or Managed Clinics. 24 Royalties and Advertising Fund Revenue. 7% 2% two Franchise Fees. ten no no Software Fees. Regional Developer Fees 2011, 2017, 3% 3% The Company entered into one six June 30, 2019 $290,000 |
Advertising Cost [Policy Text Block] | Advertising Costs Advertising costs are expensed as incurred. Advertising expenses were $656,476 $1,095,913 three six June 30, 2019, $471,056 $881,694 three six June 30, 2018, |
Income Tax, Policy [Policy Text Block] | Income Taxes The Company uses an estimated annual effective tax rate method in computing its interim tax provision. This effective tax rate is based on forecasted annual pre-tax income, permanent tax differences and statutory tax rates. Deferred income taxes are recognized for differences between the basis of assets and liabilities for financial statement and income tax purposes. The differences relate principally to depreciation of property and equipment, amortization of goodwill, accounting for leases, and treatment of revenue for franchise fees and regional developer fees collected. Deferred tax assets and liabilities represent the future tax consequence for those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled. Deferred taxes are also recognized for operating losses that are available to offset future taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. The Company accounts for uncertainty in income taxes by recognizing the tax benefit or expense from an uncertain tax position only if it is more likely than not 50% not June 30, 2019 December 31, 2018. The Company's tax returns for tax years subject to examination by tax authorities included 2014 2015 |
Earnings Per Share, Policy [Policy Text Block] | Earnings (Loss) per Common Share Basic earnings (loss) per common share is computed by dividing the net income (loss) by the weighted-average number of common shares outstanding during the period. Diluted earnings (loss) per common share is computed by giving effect to all potentially dilutive common shares including preferred stock, restricted stock, and stock options. Three Months Ended Six Months Ended June 30, June 30, 2019 2018 2019 2018 (as adjusted) (as adjusted) Net Income (loss) $ 462,260 $ (50,838 ) $ 1,414,905 $ (82,453 ) Weighted average common shares outstanding - basic 13,797,497 13,622,710 13,774,474 13,605,370 Effect of dilutive securities: Unvested restricted stock and stock options 679,510 – 615,845 – Weighted average common shares outstanding - diluted 14,477,007 13,622,710 14,390,320 13,605,370 Basic earnings (loss) per share $ 0.03 $ – $ 0.10 $ (0.01 ) Diluted earnings (loss) per share $ 0.03 $ – $ 0.10 $ (0.01 ) Potentially dilutive securities excluded from the calculation of diluted net income per common share as the effect would be anti-dilutive were as follows: Three Months Ended Six Months Ended June 30, June 30, Weighted average potentially dilutive securities: 2019 2018 2019 2018 Unvested restricted stock – – 2,569 – Stock options – – 41,035 – |
Share-based Payment Arrangement [Policy Text Block] | Stock-Based Compensation The Company accounts for share-based payments by recognizing compensation expense based upon the estimated fair value of the awards on the date of grant. The Company determines the estimated grant-date fair value of restricted shares using quoted market prices and the grant-date fair value of stock options using the Black-Scholes option pricing model. In order to calculate the fair value of the options, certain assumptions are made regarding the components of the model, including the estimated fair value of underlying common stock, risk-free interest rate, volatility, expected dividend yield and expected option life. Changes to the assumptions could cause significant adjustments to the valuation. The Company recognizes compensation costs ratably over the period of service using the straight-line method. |
Use of Estimates, Policy [Policy Text Block] | Use of Estimates The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. Items subject to significant estimates and assumptions include the allowance for doubtful accounts, share-based compensation arrangements, fair value of stock options, useful lives and realizability of long-lived assets, classification of deferred revenue and revenue recognition related to breakage, classification of deferred franchise costs, calculation of ROU assets and liabilities related to leases, realizability of deferred tax assets, impairment of goodwill and intangible assets and purchase price allocations. |
New Accounting Pronouncements, Policy [Policy Text Block] | Recent Accounting Pronouncements Accounting Standards Adopted Effective January 1, 2019 On January 1, 2019, 842, twelve January 1, 2019, 842 June 30, 2019 not During the process of adoption, the Company made the following elections: · The Company elected the package of practical expedients which allowed the Company to not · Whether existing or expired contracts contain leases under the new definition of a lease; · Lease classification for existing or expired leases; and · Initial direct costs for any expired or existing leases to determine if they would qualify for capitalization under ASC 842. · The Company did not · The Company did not 842. · The Company elected to make the accounting policy election for short-term leases, permitting the Company to not 842 12 The adoption of ASC 842 not 13 842. The Company reviewed other newly issued accounting pronouncements and concluded that they either are not no |
Note 1 - Nature of Operations_2
Note 1 - Nature of Operations and Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Notes Tables | |
Schedule of Error Corrections and Prior Period Adjustments [Table Text Block] | Three Months Ended Adjustments Due To Three Months Ended June 30, 2018 VIE Consolidation June 30, 2018 (as reported) (as adjusted) Revenues: Revenues from company-owned or managed clinics $ 3,420,685 1,247,953 $ 4,668,638 Total revenues 7,556,832 1,247,953 8,804,785 General and administrative expenses 4,656,308 1,211,204 5,867,512 Total selling, general and administrative expenses 6,354,946 1,211,204 7,566,150 Loss from operations (100,402 ) 36,163 (64,239 ) Other income (expense): Bargain purchase gain 75,264 (44,809 ) 30,455 Total other income 63,575 (44,223 ) 19,352 Loss before income tax expense (36,827 ) (8,060 ) (44,887 ) Net loss and comprehensive loss $ (42,778 ) (8,060 ) $ (50,838 ) Six Months Ended Adjustments Due To Six Months Ended June 30, 2018 VIE Consolidation June 30, 2018 (as reported) (as adjusted) Revenues: Revenues from company-owned or managed clinics $ 6,677,309 2,797,002 $ 9,474,311 Total revenues 14,654,747 2,797,002 17,451,749 General and administrative expenses 9,731,234 2,404,964 12,136,198 Total selling, general and administrative expenses 12,919,593 2,404,964 15,324,557 Loss from operations (539,466 ) 391,064 (148,402 ) Other income (expense): Bargain purchase gain 75,264 (44,809 ) 30,455 Total other income 52,380 (43,835 ) 8,545 Loss before income tax expense (487,086 ) 347,229 (139,857 ) Net loss and comprehensive loss $ (429,682 ) 347,229 $ (82,453 ) Loss per share: Basic and diluted loss per share $ (0.03 ) 0.02 $ (0.01 ) Basic and diluted weighted average shares 13,605,370 - 13,605,370 December 31, Adjustments Due To December 31, 2018 VIE Consolidation 2018 ASSETS (as reported) (as adjusted) Current assets: Accounts receivable, net 1,213,707 (407,357 ) 806,350 Total current assets 11,711,345 (407,357 ) 11,303,988 Goodwill 2,916,426 308,719 3,225,145 Total assets $ 23,526,352 $ (98,639 ) $ 23,427,713 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Deferred revenue from company clinics 994,493 1,535,004 2,529,497 Total current liabilities 8,738,123 1,535,004 10,273,127 Total liabilities 21,165,108 1,535,004 22,700,112 Commitments and contingencies Equity: The Joint Corp. stockholders' equity: Accumulated deficit (35,750,908 ) (1,633,743 ) (37,384,651 ) Total The Joint Corp. stockholders' equity 2,361,244 (1,633,743 ) 727,501 Non-controlling Interest - 100 100 Total equity 2,361,244 (1,633,643 ) 727,601 Total liabilities and equity $ 23,526,352 $ (98,639 ) $ 23,427,713 |
Schedule of Franchisor Disclosure [Table Text Block] | Three Months Ended Six Months Ended June 30, June 30, Franchised clinics: 2019 2018 2019 2018 Clinics open at beginning of period 404 359 394 352 Opened or Purchased during the period 14 8 26 15 Acquired or sold during the period – (1 ) (1 ) (1 ) Closed during the period (1 ) (1 ) (2 ) (1 ) Clinics in operation at the end of the period 417 365 417 365 Three Months Ended Six Months Ended June 30, June 30, Company-owned or managed clinics: 2019 2018 2019 2018 Clinics open at beginning of period 50 47 48 47 Opened during the period 1 – 3 – Acquired during the period – 1 1 1 Closed or Sold during the period – – (1 ) – Clinics in operation at the end of the period 51 48 51 48 Total clinics in operation at the end of the period 468 413 468 413 Clinic licenses sold but not yet developed 176 117 176 117 Executed letters of intent for future clinic licenses 28 9 28 9 |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | Three Months Ended Six Months Ended June 30, June 30, 2019 2018 2019 2018 (as adjusted) (as adjusted) Net Income (loss) $ 462,260 $ (50,838 ) $ 1,414,905 $ (82,453 ) Weighted average common shares outstanding - basic 13,797,497 13,622,710 13,774,474 13,605,370 Effect of dilutive securities: Unvested restricted stock and stock options 679,510 – 615,845 – Weighted average common shares outstanding - diluted 14,477,007 13,622,710 14,390,320 13,605,370 Basic earnings (loss) per share $ 0.03 $ – $ 0.10 $ (0.01 ) Diluted earnings (loss) per share $ 0.03 $ – $ 0.10 $ (0.01 ) Three Months Ended Six Months Ended June 30, June 30, Weighted average potentially dilutive securities: 2019 2018 2019 2018 Unvested restricted stock – – 2,569 – Stock options – – 41,035 – |
Note 2 - Acquisition (Tables)
Note 2 - Acquisition (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Notes Tables | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block] | Property and equipment $ 9,166 Intangible assets 62,000 Total assets acquired 71,166 Deferred revenue (14,305 ) Deferred tax liability (11,410 ) Bargain purchase gain (19,298 ) Net purchase price $ 26,153 |
Business Acquisition, Pro Forma Information [Table Text Block] | Pro Forma for the Three Months Ended Pro Forma for the Six Months Ended June 30, 2019 June 30, 2018 June 30, 2019 June 30, 2018 Revenues, net $ 11,169,979 $ 8,863,340 $ 21,894,980 $ 17,633,044 Net income (loss) $ 462,260 $ (90,437 ) $ 1,439,451 $ (207,928 ) |
Note 3 - Revenue Disclosures (T
Note 3 - Revenue Disclosures (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Notes Tables | |
Contract with Customer, Asset and Liability [Table Text Block] | Deferred Revenue short and long-term Balance at December 31, 2018 $ 13,609 Recognized as revenue during the six months ended June 30, 2019 (1,249 ) Fees received and deferred during the six months ended June 30, 2019 2,990 Balance at June 30, 2019 $ 15,350 Deferred Franchise Costs short and long-term Balance at December 31, 2018 $ 3,489 Recognized as cost of revenue during the six months ended June 30, 2019 (325 ) Costs incurred and deferred during the six months ended June 30, 2019 1,032 Balance at June 30, 2019 $ 4,196 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Table Text Block] | Contract liabilities expected to be recognized in Amount 2019 (remainder) $ 1,356 2020 2,694 2021 2,572 2022 2,150 2023 1,788 Thereafter 4,790 Total $ 15,350 |
Note 4 - Restricted Cash (Table
Note 4 - Restricted Cash (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Notes Tables | |
Reconciliation of Cash, Cash Equivalents and Restricted Cash Balance [Table Text Block] | June 30, December 31, 2019 2018 Cash and cash equivalents $ 9,485,212 $ 8,716,874 Restricted cash 129,220 138,078 Total cash, cash equivalents and restricted cash $ 9,614,432 $ 8,854,952 |
Note 5 - Notes Receivable (Tabl
Note 5 - Notes Receivable (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Notes Tables | |
Schedule of Financing Receivables, Minimum Payments [Table Text Block] | 2019 (remaining) $ 79,534 2020 137,123 2021 9,600 2022 9,086 Total $ 235,343 |
Note 6 - Property and Equipme_2
Note 6 - Property and Equipment (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Notes Tables | |
Property, Plant and Equipment [Table Text Block] | June 30, December 31, 2019 2018 Office and computer equipment $ 1,373,775 $ 1,243,104 Leasehold improvements 5,784,728 5,407,915 Software developed 1,193,007 1,145,742 Finance lease assets 80,604 – 8,432,114 7,796,761 Accumulated depreciation and amortization (5,256,290 ) (4,909,002 ) 3,175,824 2,887,759 Construction in progress 1,787,213 770,248 Property and equipment, net $ 4,963,037 $ 3,658,007 |
Note 8 - Intangible Assets (Tab
Note 8 - Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Notes Tables | |
Schedule of Intangible Assets and Goodwill [Table Text Block] | As of June 30, 2019 Gross Carrying Accumulated Net Carrying Amount Amortization Value Intangible assets subject to amortization: Reacquired franchise rights $ 1,788,000 $ (1,058,822 ) $ 729,178 Customer relationships 777,000 (733,828 ) 43,172 Reacquired development rights 2,050,482 (846,997 ) 1,203,485 $ 4,615,482 $ (2,639,647 ) $ 1,975,835 As of December 31, 2018 Gross Carrying Accumulated Net Carrying Amount Amortization Value Intangible assets subject to amortization: Reacquired franchise rights $ 1,758,000 $ (921,138 ) $ 836,862 Customer relationships 745,000 (717,498 ) 27,502 Reacquired development rights 1,413,316 (643,620 ) 769,696 $ 3,916,316 $ (2,282,256 ) $ 1,634,060 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block] | 2019 (remainder) $ 379,140 2020 741,790 2021 657,850 2022 184,842 2023 12,213 Total $ 1,975,835 |
Note 10 - Stock-based Compens_2
Note 10 - Stock-based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Notes Tables | |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block] | Six Months Ended June 30, 2019 2018 Expected volatility 35% 42% - 43% Expected dividends None None Expected term (years) 7 7 Risk-free rate 2.61% 2.53% to 2.63% Forfeiture rate 20% 20% |
Share-based Payment Arrangement, Option, Activity [Table Text Block] | Weighted Weighted Weighted Average Average Average Remaining Number of Exercise Fair Contractual Life Shares Price Value (Years) Outstanding at December 31, 2017 1,003,916 $ 4.18 $ 1.87 8.1 Granted 145,792 7.00 Exercised (95,162 ) 3.48 Cancelled (67,855 ) 3.37 Outstanding at December 31, 2018 986,691 $ 4.72 $ 2.09 6.8 Granted 62,944 12.02 Exercised (47,804 ) 5.01 Cancelled – – Outstanding at June 30, 2019 1,001,831 $ 5.17 $ 2.25 6.2 Exercisable at June 30, 2019 541,238 $ 4.61 $ 2.01 6.2 |
Share-based Payment Arrangement, Restricted Stock and Restricted Stock Unit, Activity [Table Text Block] | Restricted Stock Awards Shares Non-vested at December 31, 2018 51,134 Granted 26,131 Vested (33,012 ) Cancelled – Non-vested at June 30, 2019 44,253 |
Note 13 - Commitments and Con_2
Note 13 - Commitments and Contingencies (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Notes Tables | |
Lease, Cost [Table Text Block] | Line Item in the Company’s Consolidated Three Months Ended Six Months Ended Finance lease costs: Amortization of assets Depreciation and amortization $ 6,169 $ 12,337 Interest on lease liabilities Other income (expense), net 1,778 3,689 Total finance lease costs 7,947 16,026 Operating lease costs General and administrative expenses $ 706,368 $ 1,394,100 Total lease costs $ 714,315 $ 1,410,126 June 30, 2019 Operating Leases: Operating lease right-of -use asset $ 10,030,737 Operating lease liability - current portion $ 1,827,233 Operating lease liability - net of current portion 9,049,948 Total operating lease liability $ 10,877,181 Finance Leases: Property and equipment, at cost $ 80,604 Less accumulated amortization (12,337 ) Property and equipment, net $ 68,267 Finance lease liability - current portion $ 23,075 Finance lease liability - net of current portion 46,826 Total finance lease liabilities $ 69,901 Weighted average remaining lease term (in years): Operating leases 5.71 Finance lease 2.77 Weighted average discount rate: Operating leases 9.20 % Finance leases 10.00 % Six Months Ended Cash paid for amounts included in measurement of liabilities: Operating cash flows from operating leases $ 1,469,684 Operating cash flows from finance leases 3,689 Financing cash flows from finance leases 10,704 Non-cash transactions: ROU assets obtained in exchange for lease liabilities Operating lease $ 400,980 Finance lease 80,604 |
Lessee, Leases, Liability, Maturity [Table Text Block] | Operating Leases Finance Lease 2019 (remainder) $ 1,372,050 $ 14,393 2020 2,642,993 28,786 2021 2,545,456 28,786 2022 2,454,666 7,676 2023 1,776,161 – Thereafter 3,180,176 – Total lease payments $ 13,971,502 $ 79,641 Less: Imputed interest (3,094,321 ) (9,740 ) Total lease obligations 10,877,181 69,901 Less: Current obligations (1,827,233 ) (23,075 ) Long-term lease obligation $ 9,049,948 $ 46,826 |
Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block] | Operating Leases 2019 $ 2,630,443 2020 2,406,645 2021 2,299,887 2022 2,195,077 2023 1,474,396 Thereafter 2,772,575 Total lease payments $ 13,779,023 |
Note 14 - Segment Reporting (Ta
Note 14 - Segment Reporting (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Notes Tables | |
Schedule of Segment Reporting Information, by Segment [Table Text Block] | Three Months Ended Six Months Ended June 30, June 30, 2019 2018 2019 2018 (as adjusted) (as adjusted) Revenues: Corporate clinics $ 5,777 $ 4,669 $ 11,416 $ 9,474 Franchise operations 5,393 4,136 10,433 7,978 Total revenues $ 11,170 $ 8,805 $ 21,849 $ 17,452 Segment operating income (loss): Corporate clinics $ 564 $ (50 ) $ 1,404 $ 416 Franchise operations 2,631 1,974 5,020 3,789 Total segment operating income (loss) $ 3,195 $ 1,924 $ 6,424 $ 4,205 Depreciation and amortization: Corporate clinics $ 353 $ 245 $ 666 $ 548 Franchise operations - - - - Corporate administration 51 160 104 244 Total depreciation and amortization $ 404 $ 405 $ 770 $ 792 Reconciliation of total segment operating income (loss) to consolidated earnings (loss) before income taxes (in thousands): Total segment operating income (loss) $ 3,195 $ 1,924 $ 6,424 $ 4,205 Unallocated corporate (2,707 ) (1,988 ) (4,993 ) (4,353 ) Consolidated income (loss) from operations 488 (64 ) 1,431 (148 ) Bargain purchase gain - 30 19 30 Other income (expense), net (15 ) (11 ) (26 ) (22 ) Income (loss) before income tax expense $ 473 $ (45 ) $ 1,424 $ (140 ) |
Reconciliation of Assets from Segment to Consolidated [Table Text Block] | June 30, December 31, 2019 2018 Segment assets: (as adjusted) Corporate clinics $ 19,249 $ 8,828 Franchise operations 5,181 4,455 Total segment assets $ 24,430 $ 13,283 Unallocated cash and cash equivalents and restricted cash $ 9,614 $ 8,855 Unallocated property and equipment 1,551 487 Other unallocated assets 874 803 Total assets $ 36,469 $ 23,428 |
Supplemental Disclosure of No_2
Supplemental Disclosure of Non-cash Activity (Details Textual) - USD ($) | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | Apr. 06, 2019 | Mar. 18, 2019 | |
Income Taxes Paid | $ 23,396 | $ 19,522 | |||
Interest Paid, Including Capitalized Interest, Operating and Investing Activities, Total | 50,000 | 50,000 | |||
Payments to Acquire Businesses, Net of Cash Acquired, Total | 30,000 | $ 80,000 | |||
Contract with Customer, Liability, Total | 15,350,000 | $ 13,609,000 | |||
Stock Option Proceeds Receivable | 133,281 | ||||
Assets and Franchise Agreement [Member] | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment, Total | 9,166 | $ 9,166 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 62,000 | 62,000 | |||
Contract with Customer, Liability, Total | 3,847 | $ 12,998 | $ 3,847 | ||
License Fee Collection Upon Regional Developer Agreement [Member] | |||||
Contract with Customer, Liability, Total | 44,334 | ||||
Purchase of Property, Plant and Equipment Included in Accounts Payable [Member] | |||||
Capital Expenditures Incurred but Not yet Paid | 100,609 | 121,038 | |||
Purchase of Property, Plant and Equipment Included in Accrued Expenses [Member] | |||||
Capital Expenditures Incurred but Not yet Paid | $ 46,773 | $ 1,595 |
Note 1 - Nature of Operations_3
Note 1 - Nature of Operations and Summary of Significant Accounting Policies (Details Textual) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Cash Equivalents, at Carrying Value, Total | $ 0 | $ 0 | $ 0 | ||
Accounts Receivable, Allowance for Credit Loss, Ending Balance | 0 | 0 | 0 | ||
Goodwill, Impairment Loss | 0 | $ 0 | |||
Impairment of Long-Lived Assets Held-for-use | $ 0 | 0 | |||
Franchise Monthly Marketing Fee Gross Sales Percentage | 2.00% | ||||
Franchise Royalty Gross Sales Percentage | 7.00% | ||||
Regional Developers Royalty Sales Generated by Franchises Percentage | 3.00% | ||||
Contract with Customer, Liability, Total | 15,350,000 | $ 15,350,000 | $ 13,609,000 | ||
Advertising Expense | 656,476 | $ 471,056 | $ 1,095,913 | $ 881,694 | |
State and Local Jurisdiction [Member] | |||||
Open Tax Year | 2014 2015 2016 2017 2018 2019 | ||||
Domestic Tax Authority [Member] | |||||
Open Tax Year | 2015 2016 2017 2018 2019 | ||||
Regional Development Agreement [Member] | |||||
Contract with Customer, Liability, Total | $ 290,000 | $ 290,000 | |||
Computer Software, Intangible Asset [Member] | |||||
Finite-Lived Intangible Asset, Useful Life | 5 years | ||||
Development Rights [Member] | |||||
Finite-Lived Intangible Asset, Useful Life | 7 years | ||||
Customer Relationships [Member] | |||||
Finite-Lived Intangible Asset, Useful Life | 2 years | ||||
Minimum [Member] | |||||
Property, Plant and Equipment, Useful Life | 3 years | ||||
Minimum [Member] | Franchise Rights [Member] | |||||
Finite-Lived Intangible Asset, Useful Life | 4 years | ||||
Maximum [Member] | |||||
Property, Plant and Equipment, Useful Life | 7 years | ||||
Maximum [Member] | Franchise Rights [Member] | |||||
Finite-Lived Intangible Asset, Useful Life | 8 years |
Note 1 - Nature of Operations_4
Note 1 - Nature of Operations and Summary of Significant Accounting Policies - Impacts of Error Correction ASC 810 (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenues from company-owned or managed clinics | $ 11,169,979 | $ 8,804,785 | $ 21,849,356 | $ 17,451,749 | ||
General and administrative expenses | 7,227,662 | 5,867,512 | 13,780,566 | 12,136,198 | ||
Total selling, general and administrative expenses | 9,401,496 | 7,566,150 | 17,826,065 | 15,324,557 | ||
Loss from operations | 487,600 | (64,239) | 1,431,274 | (148,402) | ||
Bargain purchase gain | 30,455 | 19,298 | 30,455 | |||
Total other income | (15,126) | 19,352 | (7,473) | 8,545 | ||
Loss before income tax expense | 472,474 | (44,887) | 1,423,801 | (139,857) | ||
Net income (loss) | 462,260 | (50,838) | 1,414,905 | $ (82,453) | ||
Basic and diluted loss per share (in dollars per share) | $ (0.01) | |||||
Basic and diluted weighted average shares (in shares) | 13,605,370 | |||||
Accounts receivable, net | 1,033,479 | 1,033,479 | $ 806,350 | |||
Total current assets | 12,409,956 | 12,409,956 | 11,303,988 | |||
Goodwill | 3,225,145 | 3,225,145 | 3,225,145 | |||
Total assets | 36,469,416 | 36,469,416 | 23,427,713 | |||
Deferred revenue from company clinics | 2,677,782 | 2,677,782 | 2,529,497 | |||
Total current liabilities | 11,876,464 | 11,876,464 | 10,273,127 | |||
Total liabilities | 33,736,542 | 33,736,542 | 22,700,112 | |||
Commitments and contingencies | ||||||
Accumulated deficit | (35,969,746) | (35,969,746) | (37,384,651) | |||
Total The Joint Corp. stockholders' equity | 2,732,774 | 2,732,774 | 727,501 | |||
Non-controlling Interest | (100) | (100) | (100) | |||
Total equity | 2,732,874 | 165,243 | 2,732,874 | $ 165,243 | 727,601 | $ (373,821) |
Total liabilities and equity | 36,469,416 | 36,469,416 | 23,427,713 | |||
Revenues and Management Fees from Company Clinics [Member] | ||||||
Revenues from company-owned or managed clinics | $ 5,777,288 | 4,668,638 | $ 11,416,365 | 9,474,311 | ||
Previously Reported [Member] | ||||||
Revenues from company-owned or managed clinics | 7,556,832 | 14,654,747 | ||||
General and administrative expenses | 4,656,308 | 9,731,234 | ||||
Total selling, general and administrative expenses | 6,354,946 | 12,919,593 | ||||
Loss from operations | (100,402) | (539,466) | ||||
Bargain purchase gain | 75,264 | 75,264 | ||||
Total other income | 63,575 | 52,380 | ||||
Loss before income tax expense | (36,827) | (487,086) | ||||
Net income (loss) | (42,778) | $ (429,682) | ||||
Basic and diluted loss per share (in dollars per share) | $ (0.03) | |||||
Basic and diluted weighted average shares (in shares) | 13,605,370 | |||||
Accounts receivable, net | 1,213,707 | |||||
Total current assets | 11,711,345 | |||||
Goodwill | 2,916,426 | |||||
Total assets | 23,526,352 | |||||
Deferred revenue from company clinics | 994,493 | |||||
Total current liabilities | 8,738,123 | |||||
Total liabilities | 21,165,108 | |||||
Accumulated deficit | (35,750,908) | |||||
Total The Joint Corp. stockholders' equity | 2,361,244 | |||||
Non-controlling Interest | ||||||
Total equity | 2,361,244 | |||||
Total liabilities and equity | 23,526,352 | |||||
Previously Reported [Member] | Revenues and Management Fees from Company Clinics [Member] | ||||||
Revenues from company-owned or managed clinics | 3,420,685 | $ 6,677,309 | ||||
Restatement Adjustment [Member] | ||||||
Revenues from company-owned or managed clinics | 1,247,953 | 2,797,002 | ||||
General and administrative expenses | 1,211,204 | 2,404,964 | ||||
Total selling, general and administrative expenses | 1,211,204 | 2,404,964 | ||||
Loss from operations | 36,163 | 391,064 | ||||
Bargain purchase gain | (44,809) | (44,809) | ||||
Total other income | (44,223) | (43,835) | ||||
Loss before income tax expense | (8,060) | 347,229 | ||||
Net income (loss) | (8,060) | $ 347,229 | ||||
Basic and diluted loss per share (in dollars per share) | $ 0.02 | |||||
Basic and diluted weighted average shares (in shares) | ||||||
Accounts receivable, net | (407,357) | |||||
Total current assets | (407,357) | |||||
Goodwill | 308,719 | |||||
Total assets | (98,639) | |||||
Deferred revenue from company clinics | 1,535,004 | |||||
Total current liabilities | 1,535,004 | |||||
Total liabilities | 1,535,004 | |||||
Accumulated deficit | (1,633,743) | |||||
Total The Joint Corp. stockholders' equity | (1,633,743) | |||||
Non-controlling Interest | 100 | |||||
Total equity | (1,633,643) | |||||
Total liabilities and equity | $ (98,639) | |||||
Restatement Adjustment [Member] | Revenues and Management Fees from Company Clinics [Member] | ||||||
Revenues from company-owned or managed clinics | $ 1,247,953 | $ 2,797,002 |
Note 1 - Nature of Operations_5
Note 1 - Nature of Operations and Summary of Significant Accounting Policies - Clinics in Operation Under Franchise Agreements or Company-owned or Managed (Details) | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Clinics in operation at the end of the period | 468 | 413 | 468 | 413 | ||
Total clinics in operation at the end of the period | 468 | 413 | 468 | 413 | 468 | 413 |
Clinic licenses sold but not yet developed | 176 | 117 | ||||
Executed letters of intent for future clinic licenses | 28 | 9 | ||||
Franchised Units [Member] | ||||||
Clinics open at beginning of period | 404 | 359 | 394 | 352 | ||
Opened or Purchased during the period | 14 | 8 | 26 | 15 | ||
Acquired or sold during the period | (1) | (1) | (1) | |||
Closed during the period | (1) | (1) | (2) | (1) | ||
Clinics in operation at the end of the period | 417 | 365 | 417 | 365 | ||
Total clinics in operation at the end of the period | 404 | 359 | 394 | 352 | 417 | 365 |
Entity Operated Units [Member] | ||||||
Clinics open at beginning of period | 50 | 47 | 48 | 47 | ||
Opened or Purchased during the period | 1 | 3 | ||||
Acquired or sold during the period | 1 | 1 | 1 | |||
Closed during the period | (1) | |||||
Clinics in operation at the end of the period | 51 | 48 | 51 | 48 | ||
Total clinics in operation at the end of the period | 50 | 47 | 48 | 47 | 51 | 48 |
Note 1 - Nature of Operations_6
Note 1 - Nature of Operations and Summary of Significant Accounting Policies - Earnings (Loss) Per Common Share (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Net income (loss) | $ 462,260 | $ (50,838) | $ 1,414,905 | $ (82,453) |
Basic weighted average shares (in shares) | 13,797,497 | 13,622,710 | 13,774,474 | 13,605,370 |
Unvested restricted stock and stock options (in shares) | 679,510 | 615,845 | ||
Weighted average common shares outstanding - diluted (in shares) | 14,477,007 | 13,622,710 | 14,390,320 | 13,605,370 |
Basic earnings (loss) per share (in dollars per share) | $ 0.03 | $ 0.10 | $ (0.01) | |
Diluted earnings (loss) per share (in dollars per share) | $ 0.03 | $ 0.10 | $ (0.01) | |
Restricted Stock [Member] | ||||
Anti-dilutive securities (in shares) | 2,569 | |||
Share-based Payment Arrangement, Option [Member] | ||||
Anti-dilutive securities (in shares) | 41,035 |
Note 2 - Acquisition (Details T
Note 2 - Acquisition (Details Textual) - USD ($) | Apr. 06, 2019 | Mar. 18, 2019 | Jun. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2018 |
Contract with Customer, Liability, Total | $ 15,350,000 | $ 15,350,000 | $ 13,609,000 | ||
Customer Relationships [Member] | |||||
Finite-Lived Intangible Asset, Useful Life | 2 years | ||||
Assets and Franchise Agreement [Member] | |||||
Business Combination, Consideration Transferred, Total | $ 100,000 | $ 30,000 | |||
Contract with Customer, Liability, Total | 12,998 | 3,847 | 3,847 | $ 3,847 | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net, Including Bargain Purchase Gain | $ 87,002 | 26,153 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 62,000 | 62,000 | 62,000 | ||
Business Combination, Pro Forma Information, Revenue of Acquiree since Acquisition Date, Actual | 73,000 | 73,000 | |||
Business Combination, Pro Forma Information, Earnings or Loss of Acquiree since Acquisition Date, Actual | $ (2,000) | $ (13,000) | |||
Assets and Franchise Agreement [Member] | Franchise Rights [Member] | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | $ 30,000 | ||||
Finite-Lived Intangible Asset, Useful Life | 3 years | ||||
Assets and Franchise Agreement [Member] | Customer Relationships [Member] | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | $ 32,000 | ||||
Finite-Lived Intangible Asset, Useful Life | 2 years |
Note 2 - Acquisition - Purchase
Note 2 - Acquisition - Purchase Price Allocation (Details) - USD ($) | Mar. 18, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Apr. 06, 2019 |
Bargain purchase gain | $ (30,455) | $ (19,298) | $ (30,455) | |||
Assets and Franchise Agreement [Member] | ||||||
Property and equipment | $ 9,166 | 9,166 | 9,166 | |||
Intangible assets | 62,000 | $ 62,000 | $ 62,000 | |||
Total assets acquired | 71,166 | |||||
Deferred revenue | (14,305) | |||||
Deferred tax liability | (11,410) | |||||
Bargain purchase gain | (19,298) | |||||
Net purchase price | $ 26,153 | $ 87,002 |
Note 2 - Acquisition - Pro Form
Note 2 - Acquisition - Pro Forma Results of Operations (Unaudited) (Details) - Assets and Franchise Agreement [Member] - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Revenues, net | $ 11,169,979 | $ 8,863,340 | $ 21,894,980 | $ 17,633,044 |
Net income (loss) | $ 462,260 | $ (90,437) | $ 1,439,451 | $ (207,928) |
Note 3 - Revenue Disclosures (D
Note 3 - Revenue Disclosures (Details Textual) | Jun. 30, 2019 |
Number of States in which Entity Operates | 33 |
Note 3 - Revenue Disclosures -
Note 3 - Revenue Disclosures - Changes in Contract Assets and Contract Liabilities (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2019USD ($) | |
Balance, contract liabilities | $ 13,609 |
Recognized as revenue during the six months ended June 30, 2019 | (1,249) |
Fees received and deferred during the six months ended June 30, 2019 | 2,990 |
Balance, contract liabilities | 15,350 |
Balance, contract assets | 3,489 |
Recognized as cost of revenue during the six months ended June 30, 2019 | (325) |
Costs incurred and deferred during the six months ended June 30, 2019 | 1,032 |
Balance, contract assets | $ 4,196 |
Note 3 - Revenue Disclosures _2
Note 3 - Revenue Disclosures - Revenue Related to Performance Obligations (Details) | Jun. 30, 2019USD ($) |
Revenue expected to be recognized | $ 15,350 |
Note 3 - Revenue Disclosures _3
Note 3 - Revenue Disclosures - Revenue Related to Performance Obligations 2 (Details) | Jun. 30, 2019USD ($) |
Revenue expected to be recognized | $ 15,350 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-07-01 | |
Remaining Performance Obligation, Expected Timing of Satisfaction (Year) | 1 year |
Revenue expected to be recognized | $ 1,356 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-01-01 | |
Remaining Performance Obligation, Expected Timing of Satisfaction (Year) | 1 year |
Revenue expected to be recognized | $ 2,694 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-01 | |
Remaining Performance Obligation, Expected Timing of Satisfaction (Year) | 1 year |
Revenue expected to be recognized | $ 2,572 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | |
Remaining Performance Obligation, Expected Timing of Satisfaction (Year) | 1 year |
Revenue expected to be recognized | $ 2,150 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |
Remaining Performance Obligation, Expected Timing of Satisfaction (Year) | 1 year |
Revenue expected to be recognized | $ 1,788 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | |
Remaining Performance Obligation, Expected Timing of Satisfaction (Year) | 1 year |
Revenue expected to be recognized | $ 4,790 |
Note 4 - Restricted Cash - Reco
Note 4 - Restricted Cash - Reconciliation of Cash, Cash Equivalents and Restricted Cash Balance (Details) - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Dec. 31, 2017 |
Cash and cash equivalents | $ 9,485,212 | $ 8,716,874 | ||
Restricted cash | 129,220 | 138,078 | ||
Total cash, cash equivalents and restricted cash | $ 9,614,432 | $ 8,854,952 | $ 4,707,924 | $ 4,320,040 |
Note 5 - Notes Receivable (Deta
Note 5 - Notes Receivable (Details Textual) - USD ($) | Apr. 26, 2019 | Oct. 10, 2017 | Apr. 29, 2017 | Sep. 22, 2017 | Aug. 31, 2017 | Jun. 30, 2019 | Dec. 31, 2018 |
Financing Receivable, after Allowance for Credit Loss, Total | $ 235,343 | ||||||
Company-owned Clinic [Member] | |||||||
Financing Receivable, after Allowance for Credit Loss, Total | $ 235,343 | $ 278,072 | |||||
The 0% Interest Bearing Promissory Note Maturing May 15, 2022 [Member] | |||||||
Financing Receivable, after Allowance for Credit Loss, Total | $ 31,086 | ||||||
Notes Receivable, Interest Rate | 0.00% | ||||||
Notes Receivable, Contractual Term | 3 years | ||||||
Notes Receivable, Principal and Interest, Term | 3 years | ||||||
Regional Developer Territory in Central Florida [Member] | |||||||
Regional Development Agreement | $ 320,000 | ||||||
Regional Developer Territory in Central Florida [Member] | 10% Interest Bearing Promissory Note Maturing October 1, 2020 [Member] | |||||||
Financing Receivable, after Allowance for Credit Loss, Total | $ 187,000 | ||||||
Notes Receivable, Interest Rate | 10.00% | ||||||
Notes Receivable, Contractual Term | 3 years 180 days | ||||||
Notes Receivable, Principal and Interest, Term | 3 years | ||||||
Regional Developer Territory in Maryland/Washington DC [Member] | |||||||
Regional Development Agreement | $ 220,000 | ||||||
Regional Developer Territory in Maryland/Washington DC [Member] | 10% Interest Bearing Promissory Note Maturing August 1, 2020 [Member] | |||||||
Financing Receivable, after Allowance for Credit Loss, Total | $ 117,475 | ||||||
Notes Receivable, Interest Rate | 10.00% | ||||||
Notes Receivable, Contractual Term | 3 years | ||||||
Notes Receivable, Principal and Interest, Term | 3 years | ||||||
Regional Developer Territory in Minnesota [Member] | |||||||
Regional Development Agreement | $ 228,293 | ||||||
Regional Developer Territory in Minnesota [Member] | 10% Interest Bearing Promissory Note Maturing September 1, 2020 [Member] | |||||||
Financing Receivable, after Allowance for Credit Loss, Total | $ 119,147 | ||||||
Notes Receivable, Interest Rate | 10.00% | ||||||
Notes Receivable, Contractual Term | 3 years | ||||||
Notes Receivable, Principal and Interest, Term | 3 years | ||||||
Regional Developer Territories with Texas, Arkansas, and Oklahoma [Member] | |||||||
Regional Development Agreement | $ 170,000 | ||||||
Regional Developer Territories with Texas, Arkansas, and Oklahoma [Member] | 10% Interest Bearing Promissory Note Maturing October 24, 2020 [Member] | |||||||
Financing Receivable, after Allowance for Credit Loss, Total | $ 135,688 | ||||||
Notes Receivable, Interest Rate | 10.00% | ||||||
Notes Receivable, Contractual Term | 3 years | ||||||
Notes Receivable, Principal and Interest, Term | 3 years |
Note 5 - Notes Receivable - Sch
Note 5 - Notes Receivable - Schedule of Minimum Payments Due (Details) | Jun. 30, 2019USD ($) |
2019 (remaining), notes receivable | $ 79,534 |
2020, notes receivable | 137,123 |
2021, notes receivable | 9,600 |
2022, notes receivable | 9,086 |
Total, notes receivable | $ 235,343 |
Note 6 - Property and Equipme_3
Note 6 - Property and Equipment (Details Textual) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Depreciation, Total | $ 206,609 | $ 284,265 | $ 400,415 | $ 548,618 |
Finance Lease, Right-of-Use Asset, Amortization | $ 6,169 | $ 12,337 |
Note 6 - Property and Equipme_4
Note 6 - Property and Equipment - Summary of Property and Equipment (Details) - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 |
Property and equipment, gross | $ 8,432,114 | $ 7,796,761 |
Accumulated depreciation and amortization | (5,256,290) | (4,909,002) |
Property and equipment, net | 4,963,037 | 3,658,007 |
Construction in progress | 1,787,213 | 770,248 |
Office Equipment [Member] | ||
Property and equipment, gross | 1,373,775 | 1,243,104 |
Leasehold Improvements [Member] | ||
Property and equipment, gross | 5,784,728 | 5,407,915 |
Software Development [Member] | ||
Property and equipment, gross | 1,193,007 | 1,145,742 |
Property, Plant and Equipment, Finance Leases [Member] | ||
Property and equipment, gross | 80,604 | |
Accumulated depreciation and amortization | (12,337) | |
Property and equipment, net | 68,267 | |
Property Plant and Equipment, Excluding Construction in Progress [Member] | ||
Property and equipment, net | $ 3,175,824 | $ 2,887,759 |
Note 7 - Fair Value Considera_2
Note 7 - Fair Value Consideration (Details Textual) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Financial Instruments, Owned, at Fair Value, Total | $ 0 | $ 0 |
Note 8 - Intangible Assets (Det
Note 8 - Intangible Assets (Details Textual) - USD ($) | Feb. 04, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 |
Contract with Customer, Liability, Total | $ 15,350,000 | $ 15,350,000 | $ 13,609,000 | |||
Revenue from Contract with Customer, Including Assessed Tax | 11,169,979 | $ 8,804,785 | 21,849,356 | $ 17,451,749 | ||
Amortization of Intangible Assets, Total | $ 191,688 | $ 120,710 | $ 357,391 | $ 243,774 | ||
Regional Developer Rights in South Carolina and Georgia [Member] | ||||||
Contract with Customer, Liability, Total | $ 681,500 | |||||
Revenue from Contract with Customer, Including Assessed Tax | $ 44,334 |
Note 8 - Intangible Assets - In
Note 8 - Intangible Assets - Intangible Assets Acquired (Details) - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 |
Gross Carrying Amount | $ 4,615,482 | $ 3,916,316 |
Accumulated Amortization | (2,639,647) | (2,282,256) |
Net Carrying Value | 1,975,835 | 1,634,060 |
Franchise Rights [Member] | ||
Gross Carrying Amount | 1,788,000 | 1,758,000 |
Accumulated Amortization | (1,058,822) | (921,138) |
Net Carrying Value | 729,178 | 836,862 |
Customer Relationships [Member] | ||
Gross Carrying Amount | 777,000 | 745,000 |
Accumulated Amortization | (733,828) | (717,498) |
Net Carrying Value | 43,172 | 27,502 |
Development Rights [Member] | ||
Gross Carrying Amount | 2,050,482 | 1,413,316 |
Accumulated Amortization | (846,997) | (643,620) |
Net Carrying Value | $ 1,203,485 | $ 769,696 |
Note 8 - Intangible Assets - Es
Note 8 - Intangible Assets - Estimated Amortization Expense (Details) - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 |
2019 (remainder) | $ 379,140 | |
2020 | 741,790 | |
2021 | 657,850 | |
2022 | 184,842 | |
2023 | 12,213 | |
Total | $ 1,975,835 | $ 1,634,060 |
Note 9 - Debt (Details Textual)
Note 9 - Debt (Details Textual) | Jan. 03, 2017USD ($) | Dec. 31, 2016USD ($) | Jun. 30, 2019USD ($) | Feb. 28, 2019USD ($) |
Number of Notes Payable Delivered as a Portion of the Consideration Paid in Connection With Acquisitions | 2 | |||
Debt Instrument, Face Amount | $ 100,000 | |||
Revolving Credit Facility [Member] | ||||
Debt Instrument, Interest Rate, Stated Percentage | 10.00% | |||
Line of Credit Facility, Maximum Borrowing Capacity | $ 5,000,000 | |||
Line of Credit Facility, Minimum Interest Payment Over Life of Credit Agreement | 200,000 | |||
Line of Credit Facility, Periodic Payment, Interest | $ 25,000 | |||
Long-term Line of Credit, Total | $ 1,000,000 | |||
Notes Payable Delivered as a Portion of the Consideration Paid in Connection With Acquisitions [Member] | ||||
Debt Instrument, Face Amount | $ 186,000 | |||
Debt Instrument, Interest Rate, Stated Percentage | 4.25% |
Note 10 - Stock-based Compens_3
Note 10 - Stock-based Compensation (Details Textual) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 62,944 | ||||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Exercise Price | $ 12.02 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Intrinsic Value | $ 11,894,226 | $ 11,894,226 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Intrinsic Value | 7,354,410 | $ 7,354,410 | |||
Share-based Payment Arrangement, Option [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 62,944 | 145,792 | |||
Share-based Payment Arrangement, Expense | 99,846 | $ 69,640 | $ 196,650 | $ 208,813 | |
Share-based Payment Arrangement, Nonvested Award, Option, Cost Not yet Recognized, Amount | 920,988 | 920,988 | |||
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition | 2 years 292 days | ||||
Restricted Stock [Member] | |||||
Share-based Payment Arrangement, Expense | 79,106 | $ 69,347 | $ 154,074 | $ 137,816 | |
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition | 2 years 73 days | ||||
Share-based Payment Arrangement, Nonvested Award, Excluding Option, Cost Not yet Recognized, Amount | $ 469,307 | $ 469,307 |
Note 10 - Stock-based Compens_4
Note 10 - Stock-based Compensation - Fair Value Assumptions of Options Granted (Details) - Share-based Payment Arrangement, Option [Member] | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Expected volatility | 35.00% | |
Expected term (Year) | 7 years | 7 years |
Risk-free rate | 2.61% | |
Forfeiture rate | 20.00% | 20.00% |
Minimum [Member] | ||
Expected volatility | 42.00% | |
Risk-free rate | 2.53% | |
Maximum [Member] | ||
Expected volatility | 43.00% | |
Expected term (Year) | 5 years 182 days | |
Risk-free rate | 2.63% |
Note 10 - Stock-based Compens_5
Note 10 - Stock-based Compensation - Stock Options Activity (Details) - $ / shares | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Granted, Number of Shares (in shares) | 62,944 | ||
Share-based Payment Arrangement, Option [Member] | |||
Outstanding, Number of Shares (in shares) | 986,691 | 1,003,916 | |
Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 4.72 | $ 4.18 | |
Outstanding, Weighted Average Fair Value (in dollars per share) | $ 2.25 | $ 2.09 | $ 1.87 |
Outstanding, Weighted Average Remaining Contractual Life (Year) | 6 years 73 days | 6 years 292 days | 8 years 36 days |
Granted, Number of Shares (in shares) | 62,944 | 145,792 | |
Granted, Weighted Average Exercise Price (in dollars per share) | $ 12.02 | $ 7 | |
Exercised, Number of Shares (in shares) | (47,804) | (95,162) | |
Exercised, Weighted Average Exercise Price (in dollars per share) | $ 5.01 | $ 3.48 | |
Cancelled, Number of Shares (in shares) | (67,855) | ||
Cancelled, Weighted Average Exercise Price (in dollars per share) | $ 3.37 | ||
Outstanding, Number of Shares (in shares) | 1,001,831 | 986,691 | 1,003,916 |
Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 5.17 | $ 4.72 | $ 4.18 |
Exercisable, Number of Shares (in shares) | 541,238 | ||
Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 4.61 | ||
Exercisable, Weighted Average Fair Value (in dollars per share) | $ 2.01 | ||
Exercisable, Weighted Average Remaining Contractual Life (Year) | 6 years 73 days |
Note 10 - Stock-based Compens_6
Note 10 - Stock-based Compensation - Restricted Stock Activity (Details) | 6 Months Ended |
Jun. 30, 2019shares | |
Unvested (in shares) | 51,134 |
Awards granted (in shares) | 26,131 |
Awards vested (in shares) | (33,012) |
Awards forfeited (in shares) | |
Unvested (in shares) | 44,253 |
Note 11 - Income Taxes (Details
Note 11 - Income Taxes (Details Textual) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Income Tax Expense (Benefit), Total | $ 10,214 | $ 5,951 | $ 8,896 | $ (57,404) |
Note 12 - Related Party Trans_2
Note 12 - Related Party Transactions (Details Textual) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Shareholder [Member] | ||||
Related Party Transaction, Amounts of Transaction | $ 98,000 | $ 68,000 | $ 181,000 | $ 116,000 |
Note 13 - Commitments and Con_3
Note 13 - Commitments and Contingencies (Details Textual) $ in Millions | May 31, 2019USD ($) |
Operating Lease, Lease Not yet Commenced, Right-of-use Asset | $ 2.1 |
Operating Lease, Lease Not yet Commenced, Lease Liability | $ 2.1 |
Lessee, Operating Lease, Lease Not yet Commenced, Term of Contract | 6 years |
Note 13 - Commitments and Con_4
Note 13 - Commitments and Contingencies - Lease Expense and Supplemental Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Amortization of assets | $ 6,169 | $ 12,337 | ||
Interest on lease liabilities | 1,778 | 3,689 | ||
Total finance lease costs | 7,947 | 16,026 | ||
Operating lease costs | 706,368 | 1,394,100 | ||
Total lease costs | 714,315 | 1,410,126 | ||
Operating lease right-of -use asset | 10,030,737 | 10,030,737 | ||
Operating lease liability - current portion | 1,827,233 | 1,827,233 | ||
Operating lease liability - net of current portion | 9,049,948 | 9,049,948 | ||
Total operating lease liability | 10,877,181 | 10,877,181 | ||
Property and equipment, at cost | 8,432,114 | 8,432,114 | 7,796,761 | |
Less accumulated amortization | (5,256,290) | (5,256,290) | (4,909,002) | |
Unallocated property and equipment | 4,963,037 | 4,963,037 | 3,658,007 | |
Finance lease liability - current portion | 23,075 | 23,075 | ||
Finance lease liability - net of current portion | 46,826 | 46,826 | ||
Total finance lease liabilities | $ 69,901 | $ 69,901 | ||
Operating leases (Year) | 5 years 259 days | 5 years 259 days | ||
Finance lease (Year) | 2 years 281 days | 2 years 281 days | ||
Operating leases | 9.20% | 9.20% | ||
Finance leases | 10.00% | 10.00% | ||
Operating cash flows from operating leases | $ 1,469,684 | |||
Operating cash flows from finance leases | 3,689 | |||
Financing cash flows from finance leases | 10,704 | |||
Operating lease | 400,980 | |||
Finance lease | 80,604 | |||
Property, Plant and Equipment, Finance Leases [Member] | ||||
Property and equipment, at cost | $ 80,604 | 80,604 | ||
Less accumulated amortization | (12,337) | (12,337) | ||
Unallocated property and equipment | $ 68,267 | $ 68,267 |
Note 13 - Commitments and Con_5
Note 13 - Commitments and Contingencies - Maturities of Lease Liabilities (Details) - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 |
2019 (remainder) | $ 1,372,050 | |
2019 (remainder), finance lease | 14,393 | |
2020 | 2,642,993 | |
2020, finance lease | 28,786 | |
2021 | 2,545,456 | |
2021, finance lease | 28,786 | |
2022 | 2,454,666 | |
2022, finance lease | 7,676 | |
2023 | 1,776,161 | |
2023, finance lease | ||
Thereafter | 3,180,176 | |
Thereafter, finance lease | ||
Total lease payments | 13,971,502 | |
Total lease payments, finance lease | 79,641 | |
Less: Imputed interest | (3,094,321) | |
Less: Imputed interest, finance lease | 9,740 | |
Total lease obligations | 10,877,181 | |
Total lease obligations, finance lease | 69,901 | |
Less: Current obligations | (1,827,233) | |
Less: Current obligations, finance lease | 23,075 | |
Long-term lease obligation | 9,049,948 | |
Long-term lease obligation, finance lease | $ 46,826 |
Note 13 - Commitments and Con_6
Note 13 - Commitments and Contingencies - Future Minimum Annual Lease Payments for Operating Leases (Details) | Dec. 31, 2018USD ($) |
2019, operating lease | $ 2,630,443 |
2020, operating lease | 2,406,645 |
2021, operating lease | 2,299,887 |
2022, operating lease | 2,195,077 |
2023, operating lease | 1,474,396 |
Thereafter, operating lease | 2,772,575 |
Total lease payments, operating lease | $ 13,779,023 |
Note 14 - Segment Reporting (De
Note 14 - Segment Reporting (Details Textual) | 6 Months Ended |
Jun. 30, 2019 | |
Number of Operating Segments | 2 |
Note 14 - Segment Reporting - S
Note 14 - Segment Reporting - Segment Reporting Financial Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Revenues | $ 11,170,000 | $ 8,805,000 | $ 21,849,000 | $ 17,452,000 |
Operating income (loss) | 487,600 | (64,239) | 1,431,274 | (148,402) |
Depreciation and amortization | 404,000 | 405,000 | 770,143 | 792,392 |
Bargain purchase gain | 30,455 | 19,298 | 30,455 | |
Other income (expense), net | (15,126) | (11,103) | (26,771) | (21,910) |
Loss before income tax expense | 472,474 | (44,887) | 1,423,801 | (139,857) |
Operating Segments [Member] | ||||
Operating income (loss) | 3,195,000 | 1,924,000 | 6,424,000 | 4,205,000 |
Corporate, Non-Segment [Member] | ||||
Operating income (loss) | (2,707,000) | (1,988,000) | (4,993,000) | (4,353,000) |
Corporate Clinics [Member] | ||||
Revenues | 5,777,000 | 4,669,000 | 11,416,000 | 9,474,000 |
Operating income (loss) | 564,000 | (50,000) | 1,404,000 | 416,000 |
Depreciation and amortization | 353,000 | 245,000 | 666,000 | 548,000 |
Franchise Operations [Member] | ||||
Revenues | 5,393,000 | 4,136,000 | 10,433,000 | 7,978,000 |
Operating income (loss) | 2,631,000 | 1,974,000 | 5,020,000 | 3,789,000 |
Depreciation and amortization | ||||
Corporate Segment [Member] | ||||
Depreciation and amortization | $ 51,000 | $ 160,000 | $ 104,000 | $ 244,000 |
Note 14 - Segment Reporting -_2
Note 14 - Segment Reporting - Segment Reporting Information, Assets (Details) - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 |
Total assets | $ 36,469,416 | $ 23,427,713 |
Unallocated cash and cash equivalents and restricted cash | 9,485,212 | 8,716,874 |
Unallocated property and equipment | 4,963,037 | 3,658,007 |
Operating Segments [Member] | ||
Total assets | 24,430,000 | 13,283,000 |
Unallocated cash and cash equivalents and restricted cash | 9,614,000 | 8,855,000 |
Unallocated property and equipment | 1,551,000 | 487,000 |
Other unallocated assets | 874,000 | 803,000 |
Corporate Clinics [Member] | ||
Total assets | 19,249,000 | 8,828,000 |
Franchise Operations [Member] | ||
Total assets | $ 5,181,000 | $ 4,455,000 |
Note 15 - Subsequent Events (De
Note 15 - Subsequent Events (Details Textual) $ in Millions | 2 Months Ended |
Aug. 30, 2019USD ($) | |
Franchised Clinics [Member] | Subsequent Event [Member] | |
Business Combination, Consideration Transferred, Total | $ 2.8 |