Document and Entity Information
Document and Entity Information - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Mar. 24, 2021 | Jun. 30, 2020 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | SOC Telemed, Inc. | ||
Entity Central Index Key | 0001791091 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2020 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2020 | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Voluntary Filers | No | ||
Entity Shell Company | false | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | false | ||
Entity File Number | 001-39160 | ||
Entity Interactive Data Current | Yes | ||
Entity Common Stock, Shares Outstanding | 76,773,380 | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Public Float | $ 250,500 | ||
Entity Well-known Seasoned Issuer | No |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
CURRENT ASSETS | ||
Cash and cash equivalents (from variable interest entities $1,942 and $3,509, respectively) | $ 38,754 | $ 4,541 |
Accounts receivable, net of allowance for doubtful accounts of $447 and $538 (from variable interest entities, net of allowance $8,192 and $10,125, respectively) | 8,721 | 10,545 |
Prepaid expenses and other current assets | 1,609 | 843 |
Total current assets | 49,084 | 15,929 |
Property and equipment, net | 4,092 | 2,387 |
Capitalized software costs, net | 8,935 | 7,647 |
Intangible assets, net | 5,988 | 7,429 |
Goodwill | 16,281 | 16,281 |
Deposits and other assets | 559 | 321 |
Total assets | 84,939 | 49,994 |
Current liabilities | ||
Accounts payable (from variable interest entities $692 and $1,882, respectively) | 2,809 | 3,435 |
Accrued expenses (from variable interest entities $1,349 and $1,226, respectively) | 8,293 | 6,078 |
Deferred revenues | 610 | 516 |
Capital lease obligations | 48 | |
Stock-based compensation liabilities | 4,228 | |
Total current liabilities | 15,940 | 10,077 |
Puttable option liabilities | 1 | |
Deferred revenues | 923 | 807 |
Long term debt, net of unamortized discount and debt issuance costs | 77,140 | |
Contingent shares issuance liabilities | 12,450 | |
Other long-term liabilities (from variable interest entities $157 and $0, respectively) | 560 | |
Total liabilities | 29,873 | 88,025 |
COMMITMENTS AND CONTINGENCIES (Note 21) | ||
CONTINGENTLY REDEEMABLE PREFERRED STOCK | ||
Redeemable convertible preferred stock, $0.001 par value; 0 and 8,838,825 shares authorized as of December 31, 2020 and 2019, respectively; 0 and 8,838,825 shares issued and outstanding as of December 31, 2020 and 2019, respectively; aggregate liquidation preference of $0 and $62,466 as of December 31, 2020 and 2019, respectively. | 61,907 | |
STOCKHOLDERS’ EQUITY (DEFICIT) | ||
Class A common stock, $0.0001 par value; 500,000,000 and 53,428,720 shares authorized as of December 31, 2020 and 2019; 74,898,380 and 34,140,909 shares issued and outstanding at December 31, 2020 and 2019, respectively. | 8 | 3 |
Preferred stock, $0.0001 par value; 1,000,000 shares authorized, none issued and outstanding | ||
Treasury stock, 0 and 223,157 shares, at cost, as of December 31, 2020 and 2019 | (768) | |
Additional paid-in capital | 291,277 | 87,199 |
Accumulated deficit | (236,219) | (186,372) |
Total stockholders' equity (deficit) | 55,066 | (99,938) |
Total liabilities, contingently redeemable preferred stock and stockholders' equity (deficit) | $ 84,939 | $ 49,994 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Variable interest entities, cash and cash equivalents | $ 1,942 | $ 3,509 |
Allowance for doubtful accounts | 447 | 538 |
Variable interest entities, net of allowance | 8,192 | 10,125 |
Variable interest entities, accounts payable | 692 | 1,882 |
Variable interest entities, accrued expenses | 1,349 | 1,226 |
Variable interest entities, other long-term liabilities | $ 157 | $ 0 |
Redeemable convertible preferred stock, par value | $ 0.001 | $ 0.001 |
Redeemable convertible preferred stock, shares authorized | 0 | 8,838,825 |
Redeemable convertible preferred stock, shares issued | 0 | 8,838,825 |
Redeemable convertible preferred stock, shares outstanding | 0 | 8,838,825 |
Aggregate liquidation preference | $ 0 | $ 62,466 |
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | ||
Preferred stock, shares outstanding | ||
Treasury stock shares, at cost | 0 | 223,157 |
Class A Common Stock | ||
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 500,000,000 | 53,428,720 |
Common stock, shares issued | 74,898,380 | 34,140,909 |
Common stock, shares outstanding | 74,898,380 | 34,140,909 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Income Statement [Abstract] | ||
Revenues | $ 57,995 | $ 66,200 |
Cost of revenues | 38,542 | 40,213 |
Operating expenses | ||
Selling, general and administrative | 61,280 | 35,931 |
Changes in fair value of contingent consideration | (1,855) | |
Total operating expenses | 61,280 | 34,076 |
Loss from operations | (41,827) | (8,089) |
Other income (expense) | ||
Gain on contingent shares issuance liabilities | 4,237 | |
Gain on puttable option liabilities | 1 | 163 |
Interest expense | (12,227) | (10,308) |
Total other expense | (7,989) | (10,145) |
Loss before income taxes | (49,816) | (18,234) |
Income tax expense | (31) | (8) |
Net loss and comprehensive loss | (49,847) | (18,242) |
Accretion of redeemable convertible preferred stock | (96,974) | (5,514) |
Net loss attributable to common stockholders | $ (146,821) | $ (23,756) |
Net loss per share attributable to common stockholders | ||
Basic | $ (3.55) | $ (0.69) |
Diluted | $ (3.55) | $ (0.69) |
Weighted-average shares used to compute net loss per share attributable to common stockholders: | ||
Basic | 41,346,849 | 34,233,789 |
Diluted | 41,346,849 | 34,233,789 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity (Deficit) - USD ($) $ in Thousands | Common Stock | [1] | Treasury Stock | Additional Paid-in Capital | Accumulated Deficit | Total |
Balance at Dec. 31, 2018 | $ 3 | $ (768) | $ 91,614 | $ (168,130) | $ (77,281) | |
Balance, shares at Dec. 31, 2018 | 34,129,376 | (90,302) | ||||
Exercise of stock options | 20 | $ 20 | ||||
Exercise of stock options, shares | 11,533 | 9,509 | ||||
Stock-based compensation | 1,079 | $ 1,079 | ||||
Accretion of stock issuance costs and dividends on Series H, I and J contingently redeemable preferred stock | (5,514) | (5,514) | ||||
Net loss | (18,242) | (18,242) | ||||
Balance at Dec. 31, 2019 | $ 3 | $ (768) | 87,199 | (186,372) | (99,938) | |
Balance, shares at Dec. 31, 2019 | 34,140,909 | (90,302) | ||||
Stock-based compensation | 13,681 | 13,681 | ||||
Accretion of stock issuance costs and dividends on Series H, I and J contingently redeemable preferred stock | (96,974) | (96,974) | ||||
Exercise of stock options, net of withholding taxes | (11,883) | (11,883) | ||||
Exercise of stock options, net of withholding taxes, shares | 2,643,694 | |||||
Exercise of warrants | 98 | 98 | ||||
Exercise of warrants, shares | 1,210,247 | |||||
Redemption of Series H preferred stock through issuance of common stock | $ 1 | 106,642 | 106,642 | |||
Redemption of Series H preferred stock through issuance of common stock, shares | 10,600,347 | |||||
Retirement of treasury stock | $ 768 | (768) | ||||
Retirement of treasury stock, shares | (90,302) | 90,302 | ||||
Contingent shares issuance liabilities associated with the Merger and Recapitalization | (16,687) | (16,687) | ||||
Merger and Recapitalization, net of transaction costs | $ 4 | 209,969 | 209,973 | |||
Merger and Recapitalization, net of transaction costs, shares | 26,393,485 | |||||
Net loss | (49,847) | (49,847) | ||||
Balance at Dec. 31, 2020 | $ 8 | $ 291,277 | $ (236,219) | $ 55,066 | ||
Balance, shares at Dec. 31, 2020 | 74,898,380 | |||||
[1] | As part of the Merger Transaction (as disclosed in Note 17), all per share information has been retroactively adjusted using an exchange ratio of 0.4047 per share. |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Stockholders' Equity (Deficit) (Parenthetical) | Dec. 31, 2020 |
Statement of Stockholders' Equity [Abstract] | |
Exchange ratio per share | 0.4047 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Cash flows from operating activities: | ||
Net loss | $ (49,847) | $ (18,242) |
Adjustments to reconcile net loss to net cash used in operating activities | ||
Depreciation and amortization | 5,503 | 4,311 |
Stock-based compensation | 17,909 | 1,079 |
(Gain) on puttable option liabilities | (1) | (163) |
Change in fair value of contingent consideration | (1,855) | |
(Gain) on contingent shares issuance liabilities | (4,237) | |
Bad debt expense | 85 | 200 |
Paid-in kind interest on senior debt | 2,577 | 2,815 |
Amortization of debt issuance costs and accretion of original issuance discount | 2,668 | 1,273 |
Change in assets and liabilities, net of acquisitions | ||
Accounts receivable, net of allowance | 1,739 | (923) |
Prepaid expense and other current assets | (395) | 15 |
Deposits and other assets | (238) | 43 |
Accounts payable | (1,062) | 795 |
Accrued expenses and other liabilities | 2,513 | (9) |
Deferred revenues | 210 | (105) |
Net cash used in operating activities | (22,576) | (10,766) |
Cash flows from investing activities: | ||
Capitalization of software development costs | (4,309) | (3,880) |
Purchase of property and equipment | (2,221) | (1,353) |
Net cash used in investing activities | (6,530) | (5,233) |
Cash flows from financing activities: | ||
Principal payments under capital lease obligations | (75) | (134) |
Proceeds from the issuance of debt, net of discount | 5,960 | 12,867 |
Repayment of long-term debt | (88,345) | |
Issuance of contingently redeemable preferred stock, net of offering costs | 10,938 | 3,798 |
Exercise of stock options and warrants | 98 | 20 |
Stock repurchases from employees for tax withholdings | (11,883) | |
Liquidation of preferred stock (Series H, I and J) | (63,176) | |
Proceeds from merger and recapitalization, net of transaction costs | 209,802 | |
Net cash provided by financing activities | 63,319 | 16,551 |
Net increase in Cash and cash equivalents | 34,213 | 552 |
Cash and cash equivalents at beginning of year | 4,541 | 3,989 |
Cash and cash equivalents at end of year | 38,754 | 4,541 |
Supplemental disclosure of cash flow information: | ||
Cash paid during the year for taxes | 31 | 15 |
Cash paid during the year for interest | 7,109 | 6,335 |
Supplemental schedule of non-cash investing and financing transactions: | ||
Purchase of property and equipment reflected in accounts payable and accrued expenses at year end | 513 | 15 |
Assets acquired under capital lease arrangements | 26 | 110 |
Accretion of contingently redeemable preferred stock | 96,974 | 5,514 |
Redemption of Series H preferred stock through issuance of common stock | 106,642 | |
Exercise of stock options | 26,597 | |
Exercise of warrants | $ 11,765 |
Organization and Description of
Organization and Description of Business | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND DESCRIPTION OF BUSINESS | 1. ORGANIZATION AND DESCRIPTION OF BUSINESS Healthcare Merger Corp. ("HCMC") was incorporated in Delaware in September 2019 and formed as a special purpose acquisition company for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. Specialists On Call, Inc. was formed on July 14, 2004 as a Delaware C-Corporation doing business as SOC Telemed ("Legacy SOC Telemed"). On October 30, 2020, we completed the acquisition of Legacy SOC Telemed by and among us, Sabre Merger Sub I, Inc., a Delaware corporation and a wholly owned subsidiary of HCMC, Sabre Merger Sub II, LLC, a Delaware limited liability company and a wholly owned subsidiary of HCMC, and Legacy SOC Telemed. The transactions contemplated by the merger agreement between HCMC and Legacy SOC Telemed are collectively referred as the "Merger Transaction" or "Merger and Recapitalization". As part of the Merger Transaction, HCMC changed its name from Healthcare Merger Corp. to SOC Telemed, Inc. See Note 4 for additional information. SOC Telemed, Inc. and Subsidiaries and Affiliates (collectively, the "Company", "SOC Telemed", and "SOC") is committed to improving patient care by providing advanced, real-time telemedicine and the highest quality critical consultation services by connecting emergency physicians with critical care experts 24 hours a day, every day of the year. The Company is a health services management company that is responding to the need for rapid, effective treatment of emergency patients and the shortage of critical care experts. The Company operates as a single operating and reportable segment. As discussed in Note 25, on March 26, 2021, the Company entered into an equity purchase agreement (the "Agreement") to acquire Access Physicians Management Services Organization, LLC ("Access Physicians"). Pursuant to the Agreement, SOC Telemed acquired Access Physicians with a combination of cash, shares, and contingent consideration. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements include the accounts of SOC Telemed, Inc. and its Subsidiaries and Affiliates and have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP" or "GAAP") and pursuant to the accounting and disclosure rules and regulations of the Securities and Exchange Commission (the "SEC"). As of December 31, 2020 and 2019, SOC Telemed, Inc. is party to four Administrative Agreements in Georgia, California, Texas and New Jersey by and among it and the professional corporations (the "Tele-Physicians Practices") pursuant to which each professional corporation provides services to SOC Telemed, Inc. Each Tele-Physician Practice is established pursuant to the requirements of its respective domestic jurisdiction governing the corporate practice of medicine. As discussed in Note 5, Variable Interest Entities, SOC Telemed, Inc. holds a variable interest in the Tele-Physician Practices and, accordingly, the Tele-Physician Practices are considered variable interest entities ("VIE" or "VIEs") which are denominated Affiliates for consolidation purposes. The accompanying consolidated financial statements include the accounts of the Company. All intercompany balances and transactions are eliminated upon consolidation. The Merger Transaction was accounted for as a reverse recapitalization as Legacy SOC Telemed was determined to be the accounting acquirer under Financial Accounting Standards Board's Accounting Standards Codification Topic 805, Business Combinations. This determination was primarily based on Legacy SOC Telemed comprising the ongoing operations of the combined entity, Legacy SOC Telemed's senior management comprising the majority of the senior management of the combined company, and the prior shareholders of Legacy SOC Telemed having a majority of the voting power of the combined entity. In connection with the Merger Transaction, the outstanding shares of Legacy SOC Telemed preferred stock was redeemed for cash and shares of the Company's Class A common stock and the outstanding shares of Legacy SOC Telemed common stock were converted into Class A common stock of the Company, representing a recapitalization, and the net assets of the Company were acquired at historical cost, with no goodwill or intangible assets recorded. Operations and assets and liabilities of the Company prior to the Merger Transaction in these financial statements are those of Legacy SOC Telemed. As a result, these financial statements represent the continuation of Legacy SOC Telemed and the historical shareholders' deficit exclusive of common stock and loss per share of Legacy SOC Telemed prior to the Merger Transaction have been retrospectively adjusted for the Merger Transaction using an exchange ratio of 0.4047. The accumulated deficit of Legacy SOC Telemed has been carried forward after the Merger Transaction. See Note 4 for additional information. COVID – 19 Outbreak The recent outbreak of the novel coronavirus ("COVID-19"), which was declared a pandemic by the World Health Organization on March 11, 2020 and declared a National Emergency by the President of the United States on March 13, 2020, has led to adverse impacts on the U.S. and global economies and created uncertainty regarding potential impacts on the Company's operating results, financial condition and cash flows. The full extent to which the COVID-19 pandemic will directly or indirectly impact the Company's business, results of operations and financial condition, including expenses and research and development costs, will depend on future developments that are highly uncertain, including as a result of new information that may emerge concerning COVID-19 and the actions taken to contain or treat COVID-19, as well as the economic impacts. While not currently known, the full impact of COVID-19 could have a material impact on the operations of our business. For the year ended December 31, 2020 our variable revenues decreased as a result of the lower volume of consultations due to the COVID-19 pandemic with corresponding impacts on our cost of sales due to declined demand for physicians. For more details, see Going Concern Consideration below. The Company continues to closely monitor the current macro environment related to monetary and fiscal policies, as well as pandemics or epidemics, such as the recent COVID-19 outbreak. Going Concern Consideration Under Accounting Standards Update ("ASU") 2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40) ("ASC 205-40"), the Company has the responsibility to evaluate whether conditions and/or events raise substantial doubt about its ability to meet its future financial obligations as they become due within one year after the date that the financial statements are issued. As required by ASC 205-40, this evaluation shall initially not take into consideration the potential mitigating effects of plans that have not been fully implemented as of the date the financial statements are issued. As of December 31, 2020, the Company has experienced negative cash flows and losses from operations each year since inception and has an accumulated deficit of $236.2 million. The Company incurred net losses of $49.8 million and $18.2 million for the years ended December 31, 2020 and 2019, respectively, and cash outflows from operations of $22.6 million and $10.8 million for the years ended December 31, 2020 and 2019, respectively. In March 2020, the World Health Organization declared the 2019 novel coronavirus, or COVID-19, a global pandemic. The Company experienced a reduction in service utilization in and around the same time and consequently experienced a decrease in revenue and margin. The Company immediately responded by adjusting variable costs, including physician fees, travel expenses, and other discretionary spending to preserve margins which included real time assessment of physician coverage needs to appropriately align with changes in utilization experienced as a result of the COVID-19 pandemic. The Company is closely monitoring the impact of the COVID-19 pandemic on all aspects of the business and continuously modifying operational protocols, cost structure, and discretionary spending to evolving business conditions. Notwithstanding these efforts, the Company expects that its operating losses and negative cash flows will continue for the foreseeable future. The Company expects that its cash and cash equivalents of $38.8 million as of December 31, 2020 and cash proceeds of $96.5 million received through the issuance of debt in March 2021 will be sufficient to fund its operating expenses, capital expenditure requirements and debt service obligations for at least the next 12 months from the issuance of these financial statements, based upon the Company's current operating plan and its acquisition of Access Physicians Management Services Organization, LLC ("Access Physicians") in March 2021. The future viability of the Company beyond that point is dependent on its ability to raise additional capital to finance its operations. The Company has historically funded its operations through the issuance of preferred stock and long-term debt. Until such time, if ever, as the Company can generate substantial revenues and positive operating cash flows, the Company will likely finance its cash needs through a combination of public or private equity offerings or debt financings. The Company may not be able to obtain funding on acceptable terms, or at all. If the Company is unable to raise additional funds as and when needed, it would have a negative impact on the Company's financial condition, which may require the Company to delay, reduce or eliminate certain activities and reduce or eliminate discretionary operating expenses, which could constrain the Company's ability to pursue its business strategies. Concentration of credit risk Financial instruments which potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable. The Company maintains its cash and cash equivalents with high-credit quality financial institutions. At times, such amounts may exceed federally insured limits. For the years ended December 31, 2020 and 2019 no client accounts for more than 10% of the Company's accounts receivable or total revenues. Business Combination The Company applies the acquisition method of accounting for business acquisitions. The results of operations of the businesses acquired by the Company are included as of the respective acquisition date. The Company allocates the fair value of purchase consideration to the assets acquired and liabilities assumed, based on their estimated fair values. The excess of the fair value of purchase consideration over the value of these identifiable assets and liabilities is recorded as goodwill. When determining the fair value of assets acquired and liabilities assumed, management makes significant estimates and assumptions, especially with respect to the fair value of acquired intangible assets. The Company may adjust the preliminary purchase price allocation, as necessary, for up to one year after the acquisition closing date if it obtains more information regarding asset valuations and liabilities assumed. Acquisition-related expenses are recognized separately from the business combination and are expensed as incurred. Cash and Cash Equivalents The Company considers all highly liquid investments with a maturity at the date of purchase of three months or less to be cash equivalents. Accounts Receivable The Company carries its accounts receivable at net realizable value. The Company maintains an allowance for doubtful accounts for the estimated losses resulting from the inability of the Company's clients to pay their invoices. The allowance for doubtful accounts is calculated based on a specific reserve for identified at risk balances considering the Company's history of write-offs and collections as well as current credit conditions. If the financial condition of the Company's clients were to deteriorate, resulting in an impairment of their ability to make payments, additional allowances may be required. Property and Equipment Property and equipment are stated at cost less accumulated depreciation. The cost of property and equipment acquired under capital lease arrangements represents the lesser of the present value of the minimum lease payments or the fair value of the leased asset as of the inception of the lease. Depreciation expense is computed using the straight-line method over the estimated useful lives of the related assets as follows: Software 3 years Computer Equipment 3 years Furniture and Fixtures 3 years Telemedicine Equipment 2 to 5 years Leasehold Improvements Shorter of remaining lease term or the economic life Depreciation of leasehold improvements is computed using the shorter of the remaining lease term or the economic life. Telemedicine equipment consists of computer equipment and monitors, optical equipment, and accessories that allow doctors and others in separate locations to communicate and collaborate with each other. Depreciation expense for telemedicine equipment and software is included within cost of revenues, while depreciation for all other assets is included within selling, general and administrative expenses in the statements of operations. Upon installation of the telemedicine equipment at the client's location, the Company retains title to the equipment, which is held and used by the client and thus is retained on the Company's books or financed through operating and capital leases with third parties. Telemedicine equipment that has not yet been installed is not depreciated. At December 31, 2020 and 2019 the Company has $0.1 million and $0.2 million of uninstalled telemedicine equipment classified as work in progress within Property and equipment, net on the consolidated balance sheets. Expenditures for major renewals and improvements are capitalized. Expenditures for repairs and maintenance are charged to expense as incurred and included within selling, general and administrative expenses in the statements of operations. Capitalized Software Costs The Company capitalizes the cost of developing internal-use software, consisting primarily of personnel and related expenses (including stock-based compensation and employee taxes and benefits) for employees and third parties who devote time to their respective projects. The Company also capitalizes avoidable interest costs as the amount of interest that could have been avoided if funds were used to pay off the debt instead of developing the asset. Capitalized interest costs were $0.1 million for each of the years ended December 31, 2020 and 2019. Capitalization of software costs occurs during the application development stage. Software costs incurred during the preliminary project and post implementation stages are expensed as incurred. The application development stage occurs when the research stage is complete and management has committed to a project to develop software that will be used for its intended purpose. Any costs incurred during subsequent efforts to significantly upgrade and enhance the functionality of the software are also capitalized. Depreciation of capitalized software costs are recorded as a component of telemedicine equipment and software depreciation within cost of revenues on the statements of operations on a straight-line basis over their estimated useful life of four years and begins once the project is substantially complete and the software is ready for its intended purpose. Intangibles Assets All intangible assets were acquired in connection with the acquisitions of NeuroCall Holdings, LLC and its subsidiaries ("NeuroCall") on January 31, 2017, and JSA Health Corporation ("JSA Health" or "JSA") on August 14, 2018 and are amortized over their estimated useful lives based on the pattern of economic benefit derived from each asset. Intangible assets resulting from these acquisitions include hospital contracts relationships, non-compete agreements and trade names. Hospital contracts relationships are amortized over a period of 6 to 10 years using a straight-line method. Non-compete agreements are amortized over a period of 4 to 5 years using the straight-line method. The trade names represented by NeuroCall and JSA Health are amortized over 5 and 4 years, respectively, using the straight-line method. Impairment of Goodwill Goodwill is tested for impairment on an annual basis as of December 31 or between annual tests if events occur or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. The Company operates as one operating segment, which the Company has determined to be one reporting unit for the purposes of impairment testing. The Company compares the estimated fair value of a reporting unit to its book value, including goodwill. If the fair value exceeds book value, goodwill is considered not to be impaired and no additional steps are necessary. However, if the book value of a reporting unit exceeds its fair value, an impairment loss will be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. The fair value of the reporting unit is determined using various techniques, including market cap determined from the public stock price, multiple of earnings and discounted cash flow valuation methodologies. Determining the fair value of the reporting unit is judgmental in nature and involves the use of significant estimates and assumptions. These estimates and assumptions include changes in revenue and operating margins used to project future cash flows, discount rates, valuation multiples of entities engaged in the same or similar lines of business, and future economic and market conditions. The Company's annual goodwill impairment tests performed on December 31, 2020 and 2019 resulted in no impairment charges for the years ended December 31, 2020 and 2019. Impairment of Long-Lived Assets The Company determines whether long-lived assets are to be held for use or disposal. The Company monitors its long-lived assets for events or changes in circumstances that indicate that their carrying values may not be recoverable. Upon indication of possible impairment of long-lived assets held for use, the Company evaluates the recoverability of such assets by measuring the carrying amount of the long-lived asset group against the related estimated undiscounted future cash flows of the long-lived asset group. When an evaluation indicates that the future undiscounted cash flows are not sufficient to recover the carrying value of the asset, the asset is adjusted to its estimated fair value. No impairments were recorded during the years ended December 31, 2020 and 2019. Stock-Based Compensation The Company accounts for all employee stock-based payments in accordance with the provisions of Accounting Standards Codification ("ASC") 718, Compensation-Stock Compensation. This model requires companies to measure the cost of stock-based awards to employees based on the grant-date fair value of the award using an option pricing model, and to recognize that cost over the period during which an employee is required to provide service in exchange for the award. An award's value is expensed over the award's requisite service period, which is generally the vesting period, on a straight-line basis or on a graded basis as determined by the underlying award, net of estimated pre-vesting forfeitures. The Company has estimated forfeitures based on historical experience and revises the rates, as necessary, if actual forfeitures differ from initial estimates. The Company estimates the grant-date fair value of each award using the Black-Scholes model. Assumptions used when valuing options using the Black-Scholes model are: the underlying stock price, expected stock volatility, expected option term, expected dividend yield, and the risk-free interest rate. Expected stock volatility is determined using weekly average historical stock prices of comparable public companies' common stock for a period generally equal to the expected term of the options. Expected option term is determined by computing the weighted average of an award's contractual and vesting terms, also known as the simplified method. The Company does not have a history of declaring dividends on common stock and does not expect to in the near term, therefore, the dividend yield is 0%. The risk-free interest rate is equal to interest rates paid on U.S. treasuries for periods equal to the expected term. Long Term Debt The Company previously had entered into a term loan facility, which is divided into tranches. The Company capitalized costs related to the issuance of debt under the provisions of ASC Subtopic 835-30, Interest – Imputation of Interest . Contingent Shares Issuance Liabilities and Puttable Option Liabilities The Company recognizes derivatives as either an asset or liability measured at fair value in accordance with ASC 815, Derivatives and Hedging. The puttable options were the Company's derivative financial instruments and were recorded in the consolidated balance sheets at fair value. The Company does not enter into derivative transactions for speculative or trading purposes. Contingent shares issuance liabilities reflect the Company's liability to provide a variable number of shares to HCMC's sponsor and its permitted transferees, if certain publicly traded stock prices are met at various points in time. The liability was recorded at fair value at the date of the Merger Transaction and is revalued at each reporting period using a Monte Carlo simulation that factors in the current price of the Company's Class A common stock, the estimated likelihood of a change in control, and the vesting criteria of the award. Contingently Redeemable Preferred Stock The redemption provisions of the Company's Series H, I and J preferred stock were outside the Company's control, and as such the Company has recorded its contingently redeemable preferred stock outside of stockholders' deficit. The Company's outstanding contingently redeemable preferred stock was issued at a discount to its redemption price. The discount reflects stock issuance costs which were recorded as a reduction of the preferred share balance as well as cumulative dividends on the Series H, I and J preferred stock. The Company accreted its contingently redeemable preferred stock to the stock's redemption value over the period from issuance to the earliest redemption date, such that the carrying amount of the securities would equal the redemption value inclusive of accrued but unpaid dividends at the earliest redemption date. The accretion to redemption value for the Company's Series H, I and J preferred stock were recorded as a charge to additional paid-in capital, in the absence of retained earnings, with a corresponding increase to contingently redeemable preferred stock. Revenue Recognition The Company recognizes revenue using a five-step model: 1) Identify the contract(s) with a client; 2) Identify the performance obligation(s) in the contract; 3) Determine the transaction price; 4) Allocate the transaction price to the performance obligations in the contract; and 5) Recognize revenue when (or as) it satisfies a performance obligation. The Company enters into service contracts with hospitals or hospital systems, physician practice groups, and other users. Under the contracts, the clients pay a fixed monthly fee for physician consultation services. The fixed monthly fee provides for a predetermined number of monthly consultations. Should the number of consultations exceed the contracted amount, the clients also pay a variable consultation fee for the additional service. To facilitate the delivery of the consultation services, the facilities use telemedicine equipment, which can be provided and installed by the Company. The Company also provides the hospitals with user training, maintenance and support services for the telemedicine equipment used to perform the consultation services. Prior to the start of a contract, clients generally make upfront nonrefundable payments to the Company when contracting for Company training, maintenance, equipment, and implementation services. Our client contracts typically range in length from 1 to 3 years, with an automatic renewal process. We typically invoice our clients for the monthly fixed fee in advance. Our contracts typically contain cancellation clauses with advance notice, therefore, we do not believe that we have any material outstanding commitment for future revenues beyond one year from the end of a reporting period. Revenues are recognized when the Company satisfies its performance obligation to stand ready to provide telemedicine consultation services as requested. The consultations covered by the fixed monthly fee and obligation to stand-by and be ready to provide these consultations represented 70% and 62% of revenues for the years ended December 31, 2020 and 2019, respectively. Consultations that incur a variable fee due to the monthly quantity exceeding the number of consultations in the contract represented 30% and 38% for the years ended December 31, 2020 and 2019, respectively. The remainder of the revenues was attributable to monthly or annual technology and support fees, and the amortization of deferred revenues for implementation services. Upfront nonrefundable fees do not result in the transfer of a promised goods or service to the client, therefore, the Company defers this revenue and recognizes it over the average client life of 48 months. Deferred revenue consists of the unamortized balance of nonrefundable upfront fees and maintenance fees which are classified as current and non-current based on the timing of when the Company expects to recognize revenue. The Company recognized $1.1 million and $1.2 million for the years ended December 31, 2020 and 2019, respectively, of revenue into the income statement that had previously been deferred and recorded on the balance as a deferred revenue liability. Advertising Advertising costs include public relations, trade shows, market research, and general promotional items and are expensed as incurred. The Company has recorded advertising expenses of $0.9 million and $0.7 million within selling, general and administrative expenses in the statements of operations for the years ended December 31, 2020 and 2019. Income Taxes The Company follows the asset and liability method of accounting for income taxes under ASC 740, Income Taxes. Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. The Company recognizes interest and penalties associated with tax matters as part of income tax expenses and includes accrued interest and penalties with the related tax liability in the consolidated balance sheets. Significant judgement is required to evaluate uncertain tax positions. The Company evaluates its uncertain tax positions on a regular basis. Its evaluations are based on a number of factors, including changes in facts and circumstances, changes in tax law, correspondence with tax authorities during the course of audits, and effective settlement of audit issues. The Company accounts for uncertain tax positions by recognizing a tax benefit or liability at the largest amount that, in its judgement, is more than 50% likely to be realized or paid based upon technical merits of the position. Contingencies In accordance with ASC 450, Accounting for Contingencies, the Company records accruals for such loss contingencies when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. Significant judgement is required to determine both the probability and the estimated amount. The Company reviews contingencies at least quarterly and adjusts accordingly to reflect the impact of negotiations, settlements, rulings, advice of legal counsel, and updated information. At this time, the Company has no accrual related to lawsuits, claims, investigations and proceedings. Use of estimates and judgements The preparation of the consolidated financial statements in conformity with U.S. GAAP requires the Company to make estimates and assumptions about future events that affect the amounts reported in its consolidated financial statements and the accompanying notes. Future events and their effects cannot be determined with certainty. On an ongoing basis, management evaluates these estimates, judgments and assumptions. Significant estimates and assumptions are included within, but not limited to: (1) revenue recognition, including the determination of the client relationship period, (2) accounts receivable and allowance for doubtful accounts, (3) long-lived asset recoverability, (4) useful lives of long-lived and intangible assets, (5) stock-based compensation, option and warrant liabilities, (6) fair value of identifiable purchased tangible and intangible assets in a business combination, (7) market cap determined from the public stock price for goodwill impairment testing, (8) fair value measurements, and (9) the provision for income taxes and related deferred tax accounts. The Company bases these estimates on historical and anticipated results and trends and on various other assumptions that the Company believes are reasonable under the circumstances, including assumptions as to future events. Actual results could differ from those estimates, and any such differences may be material to the Company's consolidated financial statements. The Company is unable to predict the full impact that COVID-19 will have on its financial position, operating results, and cash flows due to numerous uncertainties. The extent to which COVID-19 impacts the Company's results will depend on future developments, which are highly uncertain and cannot be predicted, including new information that may emerge concerning the severity of COVID-19 and the actions to contain the virus or treat its impact, among others. The Company's consolidated financial statements presented herein reflect the latest estimates and assumptions made by management that affect the reported amounts of assets and liabilities and related disclosures as of the date of the consolidated financial statements and reported amounts of revenue and expenses during the reporting periods presented. Actual results may differ significantly from these estimates and assumptions. Emerging Growth Company As an emerging growth company ("EGC"), the Jumpstart Our Business Startups Act ("JOBS Act") allows the Company to delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are applicable to private companies. The Company has elected to use the extended transition period under the JOBS Act until such time the Company is not considered to be an EGC. The adoption dates are discussed in the section below to reflect this election. The Company is also a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. The Company will remain a smaller reporting company until the last day of the fiscal year in which (i) the market value of the Class A common stock held by non-affiliates exceeds $250 million as of the end of that year's second fiscal quarter, or (ii) annual revenues exceeded $100 million during such completed fiscal year and the market value of the Class A common stock held by non-affiliates exceeds $700 million as of the end of that year's second fiscal quarter. To the extent the Company takes advantage of such reduced disclosure obligations, it may also make the comparison of its financial statements with other public companies difficult or impossible. Recently Issued Accounting Pronouncements Accounting pronouncements issued and adopted In August 2018, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2018-13, Fair Value Measurement ("Topic 820"), which modifies, removes and adds certain disclosure requirements on fair value measurements. The new guidance was required for the Company for the annual reporting period beginning January 1, 2020 and interim periods within that fiscal year. The Company adopted this guidance starting from January 1, 2020, however, there was no material impact resulting from the adoption of this pronouncement. In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2014-09, Revenue from Contracts with Customers (Topic 606), to achieve a consistent application of revenue recognition within the U.S., resulting in a single revenue model to be applied by reporting companies under GAAP. Under the new model, recognition of revenue occurs when a customer obtains control of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, the revised guidance requires that reporting companies disclose the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. Subsequent to the issuance of ASU 2014-09, the FASB also issued several updates related to ASU 2014-09 including deferring its adoption date. As per the latest ASU 2020-05, issued by the FASB, the entities who have not yet issued or made available for issuance the financial statements as of June 3, 2020 can defer the new guidance for one year. The revised guidance is required to be applied retrospectively to each prior reporting period presented or modified retrospectively applied with the cumulative effect of in |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | 3. SEGMENT INFORMATION The Company's Chief Operating Decision Maker ("CODM"), its Chief Executive Officer ("CEO"), reviews the financial information presented on a consolidated basis for purposes of allocating resources and evaluating its financial performance. Accordingly, the Company has determined that it operates in a single reportable segment: health services management. All of the Company's operations and assets are located in the United States, and all of its revenues are attributable to United States clients. |
Business Combination
Business Combination | 12 Months Ended |
Dec. 31, 2020 | |
Business Combinations [Abstract] | |
BUSINESS COMBINATION | 4. BUSINESS COMBINATION Merger with Healthcare Merger Corp. On October 30, 2020, HCMC, a special purpose acquisition company, consummated a business combination with Legacy SOC Telemed pursuant to an Agreement and Plan of Merger (the "Merger Agreement"). Pursuant to the Merger Agreement, HCMC merged with Legacy SOC Telemed, with Legacy SOC Telemed being treated as the accounting acquirer, and the Merger Transaction reflected as a reverse recapitalization, with HCMC treated as the accounting acquiree. Under this method of accounting, the consolidated financial statements of Legacy SOC Telemed are the historical financial statements of the Company. The net assets of HCMC were stated at historical costs, with no goodwill or other intangible assets recorded in accordance with U.S. GAAP, and are consolidated with Legacy SOC Telemed's financial statements on the closing date of the Merger Transaction. The shares and net loss per share available to holders of Legacy SOC Telemed's common stock prior to the Merger Transaction have been retroactively restated as shares reflecting the exchange ratio of 0.4047 established in the Merger Agreement. As a result of the Merger Transaction, Legacy SOC Telemed shareholders received aggregate consideration of $720.6 million, consisting of: ● $64.6 million in cash at the closing of the Merger Transaction from HCMC; ● $168.0 million in cash proceeds from a private placement ("PIPE") of Class A Common stock that closed concurrently with the Merger Transaction; and ● 48,504,895 shares of Class A common stock valued at $10.06 per share, totaling $488.0 million. In addition, 1,875,000 shares of the Company's Class A common stock was provided to HCMC's sponsor, which are subject to forfeiture if the Company's Class A common stock does not meet certain market price thresholds following the Merger Transaction. As of December 31, 2020, none of these shares have been released from such restrictions. Upon receipt of the aggregate proceeds, the Company redeemed certain Legacy SOC Telemed preferred shareholders for $63.2 million in cash and paid off all existing debt (principal and interests) for $90.3 million in cash. In connection with the Merger Transaction, the Company and HCMC incurred direct and incremental costs of approximately $22.7 million related to the equity issuance, consisting primarily of banking, legal, accounting, and other professional fees, which were recorded to Additional Paid-In Capital as a reduction of proceeds. The Company and HCMC also incurred $0.3 million insurance costs to support the transaction, which were recorded to Prepaid expenses and other current assets and Deposits and other assets. In addition, the Company and HCMC incurred $2.8 million of costs related to transaction bonuses paid to key employees and directors and other professional fees, which were included in selling, general, and administrative expenses in the consolidated statement of operations for the year ended December 31, 2020. |
Variable Interest Entities
Variable Interest Entities | 12 Months Ended |
Dec. 31, 2020 | |
Variable Interest Entities [Abstract] | |
VARIABLE INTEREST ENTITIES | 5. VARIABLE INTEREST ENTITIES SOC Telemed, Inc. holds a variable interest in the Tele-Physicians Practices which contract with physicians in order to provide services to the clients. SOC Telemed, Inc. and the Tele-Physicians Practices have entered into a management services agreement with each other. Under these agreements, SOC Telemed, Inc. agrees to serve as the sole and exclusive administrator of all non-clinical, day-to-day operations and business functions required for the operation of each Tele-Physicians Practice, including business support services, contracting support with clients and payers, accounting, billing and payables support, technology support, licensing exclusive telemedicine technologies, and working capital support to cover the expenses of each Tele-Physicians Practice. The Tele-Physicians Practices are considered variable interest entities ("VIE" or "VIEs") since they do not have sufficient equity to finance their activities without additional subordinated financial support. An enterprise having a controlling financial interest in a VIE must consolidate the VIE if it has both power and benefits — that is, it has (1) the power to direct the activities of a VIE that most significantly impact the VIE's economic performance (power) and (2) the obligation to absorb losses of the VIE that potentially could be significant to the VIE or the right to receive benefits from the VIE that potentially could be significant to the VIE (benefits). Under the management services agreements, SOC Telemed, Inc. has the power and rights to direct all non-clinical activities of the professional corporations and funds and absorbs all losses of the VIEs. Therefore, each of the Tele-Physicians Practices are consolidated with SOC Telemed, Inc. NeuroCall and JSA Health are wholly owned subsidiaries and as such are consolidated by SOC Telemed, Inc. JSA Health comprises four entities: JSA Health Corporation ("Corporate"), JSA Health California LLC ("LLC"), JSA Health California PC ("CAPC"), and JSA Health Texas PLLC ("PLLC"). CAPC and PLLC are medical practices (the "Medical Practices") and Corporate and LLC provide management services to the Medical Practices (the "Management Companies"). More specifically, Corporate and PLLC have entered into a management services agreement with each other, and LLC and CAPC have entered into a management services agreement with each other. As a result, Corporate and LLC hold variable interests in their respective Medical Practices which contract with physicians in order to provide services to Corporate and LLC. The Medical Practices are considered VIEs since they do not have sufficient equity to finance their activities without additional subordinated financial support. These relationships are similar to the relationship between SOC Telemed, Inc. and the Tele-Physician Practices. Therefore, each of the Medical Practices are consolidated with JSA Health. SOC Telemed, Inc. consolidates certain VIEs for which it was determined to be the primary beneficiary. The assets of the consolidated VIEs may only be used to settle obligations of the consolidated VIEs, if any. In addition, there is no recourse to the Company for the consolidated VIEs' liabilities. SOC Telemed, Inc. reassesses whether changes in the facts and circumstances regarding the Company's involvement with a VIE could cause a change in its conclusions related to consolidation. Changes in consolidation status are applied prospectively. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | 6. FAIR VALUE OF FINANCIAL INSTRUMENTS Fair value estimates of financial instruments are made at a specific point in time, based on relevant information about financial markets and specific financial instruments. As these estimates are subjective in nature, involving uncertainties and matters of significant judgment, they cannot be determined with precision. Changes in assumptions can significantly affect estimated fair value. The Company measures fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. The Company utilizes a three-tier hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: Level 1 - Level 2 - Level 3 - Liabilities historically valued with Level 3 inputs on a recurring basis are warrants and puttable stock options. As of December 31, 2020 the Company's outstanding liability consisted of only contingent shares issuance liabilities and as of December 31, 2019 the Company's outstanding liability consisted of only puttable stock options. As a result of the JSA Health acquisition in 2018, the Company measured its contingent consideration at fair value determined at Level 3. The Company estimated the fair value of contingent consideration as the present value of the expected contingent payments, determined using an Option Pricing Model and Discounted Cash Flow methods. The contingent consideration was totally reversed in 2019 and no payment was made. Therefore, the Company had $0 contingent consideration liabilities due as of December 31, 2020 and 2019. The change in fair value of the Company's contingent liability was recorded in other expenses as "Change in fair value of contingent consideration" in the consolidated statements of operations. For the years ended December 31, 2020 and 2019, the Company recognized a gain of $0 and $1.9 million in changes in fair value of contingent consideration on the consolidated statement of operations. As a result of the merger with HCMC on October 30, 2020, the Company measured its contingent shares issuance liabilities at fair value determined at Level 3. In order to capture the market conditions associated with the contingent shares issuance liabilities, the Company applied an approach that incorporated a Monte Carlo simulation, which involved random iterations that took different future price paths over each one of the components of the contingent shares issuance liabilities' contractual lives based on the appropriate probability distributions and making assumptions about potential changes in control of the Company. The fair value was determined by taking the average of the fair values under each Monte Carlo simulation trial. As a result $4.2 million was recognized and included as gain on contingent share issuance liabilities in the statements of operations. Refer to Note 16 for further details. Puttable option liabilities' fair value are computed using the Black-Scholes model. Refer to Note 14 for further details. The carrying value of Cash and Cash Equivalents approximate their fair value because of the short-term or on demand nature of these instruments. There were no transfers between fair value measurement levels during the years ended December 31, 2020 and 2019. The following tables presents information about the Company's financial assets and liabilities measured at fair value on a recurring basis (in thousands): Fair Value Measurements as of Carrying Value Level 1 Level 2 Level 3 Total Assets Cash and cash equivalents $ 38,754 $ 38,754 - - $ 38,754 Total $ 38,754 $ 38,754 - - $ 38,754 Liabilities Contingent shares issuance liabilities $ 12,450 $ - $ - $ 12,450 $ 12,450 Total $ 12,450 $ - $ - $ 12,450 $ 12,450 Fair Value Measurements as of Carrying Value Level 1 Level 2 Level 3 Total Assets Cash and cash equivalents $ 4,541 $ 4,541 - - $ 4,541 Total $ 4,541 $ 4,541 - - $ 4,541 Liabilities Puttable option liabilities $ 1 $ - - $ 1 $ 1 Total $ 1 $ - - $ 1 $ 1 The following table represents a reconciliation of Puttable option liabilities fair value measurements using the significant unobservable inputs (Level 3) (in thousands): Puttable Option Liabilities Shares Fair Value Balance, December 31, 2018 154,764 $ 164 Shares expired unexercised (32,376 ) (22 ) Change in fair value - (141 ) Balance, December 31, 2019 122,388 $ 1 Shares expired unexercised (12,141 ) (4 ) Change in fair value - 521 Shares exercised (110,247 ) (518 ) Balance, December 31, 2020 - $ - The following table represents a reconciliation of contingent consideration fair value measurements using the significant unobservable inputs (Level 3) (in thousands): Contingent Consideration Balance as of December 31, 2018 $ 1,855 (Gain) recognized in statements of operations (1,855 ) Payments - Balance as of December 31, 2019 $ - The following table represents a reconciliation of the contingent shares issuance liabilities fair value measurements using the significant unobservable inputs (Level 3) (in thousands): Contingent shares issuance liabilities Balance as of December 31, 2019 $ - Contingent shares issuance liabilities 16,687 (Gain) recognized in statements of operations (4,237 ) Balance as of December 31, 2020 $ 12,450 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | 7. PROPERTY AND EQUIPMENT At December 31, 2020 and 2019 property and equipment consisted of the following (in thousands): 2020 2019 Telemedicine equipment $ 9,249 $ 6,435 Software 1,386 1,358 Work in progress 115 234 Computer equipment 779 757 Furniture and fixtures 328 328 Leasehold improvements 568 568 $ 12,425 $ 9,680 Less accumulated depreciation (8,333 ) (7,293 ) Total $ 4,092 $ 2,387 Telemedicine equipment includes $0.5 million and $0.5 million at December 31, 2020 and 2019 of equipment acquired under capital lease agreements. For the years ended December 31, 2020 and 2019 depreciation expense for all assets except telemedicine equipment was $0.1 million and $0.2 million, respectively and included in selling, general and administrative expenses on the statements of operations. Depreciation expense for telemedicine equipment is included within in cost of revenues on the statements of operations and was $0.9 million and $0.5 million for the years ended December 31, 2020 and 2019, respectively. |
Capitalized Software Costs
Capitalized Software Costs | 12 Months Ended |
Dec. 31, 2020 | |
Capitalized Software Costs [Abstract] | |
CAPITALIZED SOFTWARE COSTS | 8. CAPITALIZED SOFTWARE COSTS At December 31, 2020 and 2019 capitalized software costs consisted of the following (in thousands): December 31, 2020 Useful Life Gross Value Accumulated Depreciation Net Carrying Value Capitalized software development costs 4 years $ 15,844 $ (6,909 ) $ 8,935 December 31, 2019 Useful Life Gross Value Accumulated Depreciation Net Carrying Value Capitalized software development costs 4 years $ 11,535 $ (3,888 ) $ 7,647 The software development costs capitalized were $4.3 million and $3.9 million for the years ended December 31, 2020 and 2019, respectively. Depreciation expense for capitalized software costs included within cost of revenues on the statements of operations was $3.0 million and $2.2 million for the years ended December 31, 2020 and 2019, respectively. |
Goodwill
Goodwill | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill [Abstract] | |
GOODWILL | 9. GOODWILL Goodwill resulted from acquisitions of NeuroCall on January 31, 2017, and JSA Health on August 14, 2018. The asset was $16.3 million for the years ended December 31, 2020 and 2019.The Company performed its annual impairment test in December. There were no indications of impairment as of and for the years ended December 31, 2020 and 2019. |
Intangible Assets
Intangible Assets | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS | 10. INTANGIBLE ASSETS At December 31, 2020 and 2019 intangible assets consisted of the following (in thousands): December 31, 2020 Useful Life Gross Value Accumulated Amortization Net Carrying Value Weighted Average Hospital contracts relationships 6 to 10 years $ 8,480 $ (3,085 ) $ 5,395 6.5 Non-compete agreements 4 to 5 years 45 (32 ) 13 2.0 Trade names 4 to 5 years 1,810 (1,230 ) 580 1.4 Intangible assets, net $ 10,335 $ (4,347 ) $ 5,988 5.8 December 31, 2019 Useful Life Gross Value Accumulated Amortization Net Carrying Value Weighted Average Hospital contracts relationships 6 to 10 years $ 8,480 $ (2,066 ) $ 6,414 7.5 Non-compete agreements 4 to 5 years 45 (21 ) 24 3.0 Trade names 4 to 5 years 1,810 (819 ) 991 2.4 Intangible assets, net $ 10,335 $ (2,906 ) $ 7,429 6.8 The amortization expense for intangible assets was $1.4 million and $1.4 million for each of the years ended December 31, 2020 and 2019, respectively, which are included within the selling, general and administrative expenses on the statements of operations. Periodic amortization that will be charged to expense over the remaining life of the intangible assets as of December 31, 2020 is as follows (in thousands): Years ending December 31, Amortization Expense 2021 1,437 2022 1,194 2023 629 2024 590 Thereafter 2,138 $ 5,988 |
Debt
Debt | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
DEBT | 11. DEBT Related party - Convertible Bridge Notes Payable On September 1, 2020, Legacy SOC Telemed entered into a convertible bridge note purchase agreement (the "Bridge Notes", the "Bridge Note Agreement") with its controlling stockholder, SOC Holdings LLC ("SOC Holdings" and "the Lead Investor"). SOC Holdings constitutes a related party of the Company, pursuant to ASC 850, Related Parties Under the Bridge Note Agreement, Legacy SOC Telemed was permitted to borrow aggregate principal of up to $8.0 million, pursuant to an initial closing and potential additional closings on or before January 29, 2021. As discussed above, the initial closing of $2.0 million occurred on September 3, 2020. Two additional closings of $2.0 million each occurred on September 28, 2020 and October 13, 2020 respectively. The terms of the Bridge Notes are summarized as follows: ● Annual interest rate: 13% paid "in-kind" (PIK), compound quarterly based on a 365 day year. ● Stated maturity: Any time after June 30, 2023, the outstanding principal and accrued PIK interest becomes due and payable upon the written demand of the Lead Investor. ● Optional prepayments: The Company may prepay the Bridge Notes and PIK interest any time before June 30, 2023 without penalty. The Bridge Notes required accelerated settlement of principal and PIK interest prior to the stated maturity. As discussed below, the Bridge Notes were convertible into Legacy SOC Telemed's equity securities only following the termination of the Merger Agreement. For the year ended December 31, 2020, interest expense of less than $0.1 million was recognized. On October 30, 2020, the Bridge Notes were extinguished in connection with the closing of the Merger Transaction. Refer to Note 4 for further discussion on the Merger Transaction. As a result, the amortization of the balance of less than $0.1 million of debt issuance costs as of October 30, 2020 was accelerated and recognized as interest expenses on the statement of operations for the year ended December 31, 2020. Term Loan Agreement In June 2016, the Company entered into a Term Loan Agreement with CRG Servicing LLC ("CRG). In addition to the principal and PIK interest balances, the Company was also liable for a final payoff fee of 6% of the principal balance payable at maturity or upon prepayment. The Company estimated the payoff fee to be $4.7 million, which was included as a debt discount offset against the Company's outstanding debt balance on the consolidated balance sheets and amortized as a component of interest expense over the term of the loan. Interest expense related to the long-term debt agreements, including acceleration of the amortization of debt issuance costs and discount and prepayment premium, for the years ended December 31, 2020 and 2019 was $12.2 million and $10.3 million, respectively. On April 15, 2020, the Term Loan Agreement with CRG was amended ("the Fourth Amendment") to incorporate the following modifications: (i) extend the interest-only period until March 31, 2022; (ii) extend the PIK period until March 31, 2022; and (iii) change the stated maturity date of all tranches to March 31, 2023. The Term Loan Agreement included several financial and non-financial covenants. The Company was in compliance with the covenants as of December 31, 2019. The Company determined the fair value of long-term debt using discounted cash flows, applying current interest rates and current credit spreads, based on its own credit risk. Such instruments were classified as Level 2. The fair value was approximately $81.0 million as of December 31, 2019. The Term Loan Agreement contained a material adverse change provision which permitted the lender to accelerate the scheduled maturities of the obligations under the loan. On October 30, 2020, the Term Loan was extinguished in connection with the closing of the Merger Transaction. Refer to Note 4 for further discussion on the Merger Transaction. As a result, the amortization of the balance of $1.4 million of debt issuance costs as of October 30, 2020 was accelerated and a prepayment premium associated with the payoff of the debt of $1.2 million were recognized as interest expenses on the statement of operations for the year ended December 31, 2020. |
Accrued Expenses
Accrued Expenses | 12 Months Ended |
Dec. 31, 2020 | |
Payables and Accruals [Abstract] | |
ACCRUED EXPENSES | 12. ACCRUED EXPENSES At December 31, 2020 and 2019 accrued expenses consisted of the following (in thousands): Current liabilities 2020 2019 Accrued compensation $ 3,210 $ 2,473 Accrued bonuses 2,647 1,082 Accrued professional and service fees 1,626 2,228 Accrued other expenses 810 295 $ 8,293 $ 6,078 Non-current liabilities Other long term liabilities 560 - $ 560 $ - |
Capital Leases
Capital Leases | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
CAPITAL LEASES | 13. CAPITAL LEASES The Company was obligated under certain capital leases for telemedicine equipment which expired in 2020 (Note 7). The implicit interest rates on these leases were approximately 20.0%. These leases were secured by the related equipment. As of December 31,2019, the remaining lease payments under capital leases which reflect the present value of future minimum lease payments was less than $0.1 million. The remaining lease payments as of December 31, 2019 had maturity dates in 2020 and, therefore, were presented as current liabilities. All capital lease agreements were paid out in 2020. |
Puttable Option Liabilities
Puttable Option Liabilities | 12 Months Ended |
Dec. 31, 2020 | |
Contingently Redeemable Preferred Stock [Abstract] | |
PUTTABLE OPTION LIABILITIES | 14. PUTTABLE OPTION LIABILITIES The changes in fair value for contracts related to puttable options were recorded in the statements of operations. The Company does not offset derivative assets and derivative liabilities in its consolidated balance sheets. In connection with the Series G financing in 2014 the Company amended the terms of 199,129 fully vested stock options previously granted to certain tendering shareholders with strike prices ranging from $0.99 to $9.64 (the "Puttable Options"). The number of stock options and strike prices were converted using an exchange ratio of 0.4047 as a result of the Merger Transaction. These puttable options were considered to expire from 2020 to 2024. The amendment extended the exercise period and granted a limited right for the holder to require the Company to repurchase some or all of the shares received upon future exercise of the Puttable Options. At the election of the holder, the Company was obligated to repurchase the shares at the then-current fair value as determined by the third-party valuation firm. As a result of the modification, the Puttable Options were considered to be derivative financial liabilities and were, therefore, reclassified at the modification date fair value from stockholders' deficit to non-current liabilities on the consolidated balance sheets and were subsequently being carried at fair value. As a result of the closing of the Merger Transaction on October 30, 2020, all puttable options were exercised. Refer to Note 6, Fair Value of Financial Instruments for further discussion. Therefore, as of December 31, 2020 there were no outstanding puttable option liabilities. As of December 31, 2019, the Puttable Options had a fair value of less than $0.1 million, included within puttable option liabilities on the consolidated balance sheets. |
Contingently Redeemable Preferr
Contingently Redeemable Preferred Stock | 12 Months Ended |
Dec. 31, 2020 | |
Contingently Redeemable Preferred Stock [Abstract] | |
CONTINGENTLY REDEEMABLE PREFERRED STOCK | 15. CONTINGENTLY REDEEMABLE PREFERRED STOCK The Company had three outstanding series of redeemable preferred stock. In connection with the closing of the Merger Transaction on October 30, 2020, the Series I and J Contingently Redeemable Preferred Stock were redeemed for $28.6 million and $16.4 million, respectively in cash. The Series H Contingently Redeemable Preferred Stock was redeemed for $18.1 million in cash and 10,600,347 shares of Class A common stock in SOC Telemed, Inc. as follows: As of December 31, 2020 Liquidation Preference as of 10/30/2020 Redemption through issuance of Cash Redemption through issuance of Class A Common Stock Number of Class A Common Shares Issued (*) Series H $ 124,779 $ 18,136 $ 106,643 10,600,347 Series I 28,593 28,593 - - Series J 16,447 16,447 - - $ 169,819 $ 63,176 $ 106,643 10,600,347 (*) Securities of the surviving company: SOC Telemed, Inc. The authorized, issued and outstanding preferred shares, issue price, and carrying value at December 31, 2019 were as presented in the table below. Additionally, the number of preferred shares and their respective issue prices were converted using an exchange ratio of 0.4047 as a result of the Merger Transaction. As of December 31, 2019 Shares Authorized Shares Issued and Outstanding Issue Price Carrying Amount Series H 8,814,825 8,814,825 $ 2.82 $ 32,675 Series I 20,000 20,000 1,000.00 25,412 Series J 4,000 4,000 1,000.00 3,820 8,838,825 8,838,825 $ 61,907 Series H Preferred Stock During 2015 and 2016, the Company issued 8,814,825 shares of Series H contingently redeemable preferred stock in exchange for $24.7 million of cash consideration. The Company incurred total offering costs of $0.5 million. Offering costs were recorded against proceeds received and were accreted over the redemption term of the preferred stock which could be first redeemed on September 30, 2022. The rights and privileges of the Series H redeemable preferred stock were as follows: ● Voting - ● Dividends - No dividends on any other series of preferred stock or common stock shall be declared or paid unless all holders of the Series H preferred stock participate on an as-converted basis. There were no declared dividends. Cumulative dividends were accreted and recorded as an increase to the contingently redeemable preferred stock. As of December 31, 2019, total unpaid accumulated dividends due the Series H preferred stockholders was $8.1 million ($0.91 per share), respectively and are included as a component of the Series H contingently redeemable preferred shares carrying value as of December 31, 2019. ● Liquidation - A liquidation, dissolution or winding-up of the Company is defined to include (a) the acquisition of the Company by another entity by means of any transaction or series of related transactions (including without limitation, any reorganization, merger or consolidation, or sale of stock); or (b) a sale of all or substantially all the assets of the Company; unless the Company's stockholders of record as constituted immediately prior to such acquisition or sale, hold at least 50% of the fully diluted equity (including at least 50% of the voting power) of the surviving or acquired entity. The Merger Transaction with HCMC was determined to be a deemed liquidation event and as a result $90.3 million was accreted as additional dividends increasing the Series H liquidation preference to $124.8 million. The Company paid $18.1 million in cash and issued 10,600,397 shares of common stock to settle the required redemption. ● Conversion - ● Redemption - Series I Preferred Stock During 2017 and 2018, the Company issued 20,000 shares of Series I preferred stock in exchange for $20 million of cash consideration. The Company incurred total offering costs of $0.2 million. Offering costs were recorded against proceeds received and accreted over the redemption term of the award, as applicable. The rights and privileges of the Series I redeemable preferred stock were as follows: ● Voting - ● Dividends - As of December 31, 2019, there were no declared dividends. Cumulative dividends were accreted and recorded as an increase to the contingently redeemable preferred stock. As of December 31, 2019, total unpaid accumulated dividends due the Series I preferred stockholders was $5.6 million ($280.77 per share) and was included as a component of the Series I contingently redeemable preferred shares carrying value as of December 31, 2019. ● Liquidation - A liquidation, dissolution or winding-up of the Company was defined to include (a) the acquisition of the Company by another entity by means of any transaction or series of related transactions (including without limitation, any reorganization, merger or consolidation, or sale of stock); or (b) a sale of all or substantially all the assets of the Company; unless the Company's stockholders of record as constituted immediately prior to such acquisition or sale, hold at least 50% of the fully diluted equity (including at least 50% of the voting power) of the surviving or acquired entity. The Merger Transaction qualifies as a liquidation. ● Conversion - ● Redemption - Series J Preferred Stock During 2019, the Company issued 4,000 shares of Series J preferred stock in exchange for $4.0 million of cash consideration. The Company incurred offering costs of $0.1 million. Offering costs were recorded against proceeds received and accreted over the redemption term of the award, as applicable. The Series J preferred stock purchase agreement contained firm commitments for additional subsequent closings during 2020 for the remaining authorized shares of 11,000 in exchange for $11.0 million of cash consideration. Additional subsequent closings were fully funded in cash totaling $3.7 million on January 28, 2020, $3.7 million on March 27, 2020, and $3.6 million on June 12, 2020. The rights and privileges of the Series J redeemable preferred stock were as follows: ● Voting - . ● Dividends There have been no declared dividends. Cumulative dividends have been accreted and recorded as an increase to the contingently redeemable preferred stock. As of December 31, 2019, total unpaid accumulated dividends due the Series J preferred stockholders was less than $0.1 million ($5.55 per share) and was included as a component of the Series J contingently redeemable preferred shares carrying value as of December 31, 2019. ● Liquidation - A liquidation, dissolution or winding-up of the Company is defined to include (a) the acquisition of the Company by another entity by means of any transaction or series of related transactions (including without limitation, any reorganization, merger or consolidation, or sale of stock); or (b) a sale of all or substantially all the assets of the Company; unless the Company's stockholders of record as constituted immediately prior to such acquisition or sale, hold at least 50% of the fully diluted equity (including at least 50% of the voting power) of the surviving or acquired entity. The Merger Transaction qualifies as a liquidation ● Conversion - ● Redemption - |
Contingent Shares Issuance Liab
Contingent Shares Issuance Liabilities | 12 Months Ended |
Dec. 31, 2020 | |
Contingently Redeemable Preferred Stock [Abstract] | |
CONTINGENT SHARES ISSUANCE LIABILITIES | 16. CONTINGENT SHARES ISSUANCE LIABILITIES The table below represents the components of outstanding contingent shares issuance liabilities (in thousands): 2020 2019 Contingent sponsor earnout shares 11,364 - Private placement warrants 1,086 - Balance at $ 12,450 $ - Contingent Sponsor Earnout Shares On October 30,2020, as a result of the Merger Transaction, SOC modified the terms of 1,875,000 shares of Class A common stock ("Sponsor Earnout Shares") then held by HCMC's sponsor, such that 50% of such shares will be forfeited if the share price of Class A common stock does not reach a volume-weighted average closing sale price of $12.50 for 20 out of 30 consecutive trading days and 50% of such shares will be forfeited if the share price of Class A common stock does not reach a volume-weighted average closing sale price of $15.00 for 20 out of 30 consecutive trading days, in each case, prior to the seventh anniversary of the closing of the Merger Transaction ("Earnout Period"). The Sponsor Earnout Shares may not be transferred without the Company's consent until the shares vest. In addition, there is a change of control provision. If, during the Earnout Period, there is a change of control pursuant to which (a) the Company's stockholders have the right to receive consideration attributing a value of at least $10.00 but less than $12.50 to each share of Class A common stock and (b) greater than fifty (50%) of the aggregate amount of such consideration is in the form of equity securities, then fifty percent (50%) of the Sponsor Earnout Shares shall be forfeited, and the portion of the remaining fifty percent (50%) of the Sponsor Earnout Shares determined by multiplying (i) fifty percent (50%) of the Sponsor Earnout Shares by (ii) the ratio that the aggregate consideration in the form of equity securities in such transaction bears to the aggregate amount of all consideration in such transaction (including cash and equity securities) shall, in connection with the consummation of such change of control, be converted into such equity securities and shall remain subject to vesting upon the occurrence of the same conditions during the Earnout Period. Additionally, if, during the Earnout Period, there is a change of control pursuant to which Company's stockholders have the right to receive consideration attributing a value of less than $10.00 to each share of Class A common stock, then the Sponsor Earnout Shares shall be forfeited. In order to capture the market conditions associated with the Sponsor Earnout Shares, the Company applied an approach that incorporated a Monte Carlo simulation, which involved random iterations that took different future price paths over the Sponsor Earnout Shares' contractual life based on the appropriate probability distributions. The fair value was determined by taking the average of the fair values under each Monte Carlo simulation trial. As part of the closing of the Merger Transaction, and in accordance with the employment agreement with the Company's Chief Executive Officer ("CEO"), an award equal to 15% of the Sponsor Earnout Shares was deemed granted to the CEO as performance share units ("PSUs") subject to the same market vesting conditions as the Sponsor Earnout Shares and recorded as stock-based compensation. Refer to Note 18 for further details. The remaining 85% was determined to be classified as a noncurrent liability as contingent shares issuance liabilities. The estimated liability of the remaining 85% of the Sponsor Earnout Shares granted on October 30, 2020 was $15.2 million. The fair value was remeasured as of December 31, 2020 and estimated to be $11.4 million. As a result, $3.8 million was recognized and included as gain on contingent shares issuance liabilities in the statements of operations. Private Placement Warrants On October 30, 2020, SOC effectively granted approximately 350,000 private placement warrants with a 5-year term and strike price of $11.50 per share. In addition, if the last sales price of the Company's Class A common stock as quoted on Nasdaq is at least $18.00 for 20 out of 30 consecutive trading days, the Company has the option to repurchase these securities for $0.01 per warrant. Unlike the public warrants, the private placement warrants are not redeemable so long as they are held by HCMC's sponsor or its permitted transferees. Therefore, based on the nature of this settlement feature, it was determined that these securities should be measured at fair value and classified as a liability. In order to capture the market conditions associated with the private placement warrants, the Company applied an approach that incorporated a Monte Carlo simulation, which involved random iterations that took different future price paths over the warrant's contractual life based on the appropriate probability distributions. The fair value was determined by taking the average of the fair values under each Monte Carlo simulation trial. The private placement warrants were recorded as a noncurrent liability as contingent shares issuance liabilities. The estimated liability granted on October 30, 2020 was $1.5 million. The fair value was remeasured as of December 31, 2020 and estimated to be $1.1 million. As a result, $0.4 million was recognized and included as gain on contingent shares issuance liabilities in the statements of operations. |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
STOCKHOLDERS' EQUITY (DEFICIT) | 17. STOCKHOLDERS' EQUITY (DEFICIT) Pursuant to the Company's restated Articles of Incorporation, the Company authorized the issuance of 500,000,000 shares of Class A common stock and 5,000,000 shares of preferred stock, each with par value of $0.0001 per share. The Company had 74,898,380 and 34,140,909 shares issued and outstanding at December 31, 2020 and 2019, respectively. Each share of Class A common stock is entitled to one vote. The holders of Class A common stock are also entitled to receive dividends whenever funds are legally available and when declared by the Board of Directors. The Company's Board of Directors has not declared common stock dividends since inception. On October 30, 2020 as part of the Merger Transaction (as disclosed in Note 4) all outstanding shares of Legacy SOC Telemed common stock was converted into Class A common stock of SOC Telemed, Inc. using an exchange ratio of 0.4047 per share. All per share information has been retroactively adjusted for this exchange ratio. As part of the Merger Transaction the following events occurred impacting common stock: ● Treasury stock was retired. ● Series H preferred stock was partially redeemed in exchange for Class A common stock resulting in 10,600,347 shares of Class A common stock being issued to the previous Series H preferred stockholders. ● All vested stock options under the Legacy SOC Telemed 2014 Equity Incentive Plan were exercised into Class A common stock resulting in 2,643,694 shares of Class A common stock. ● All outstanding warrants to purchase shares of Legacy SOC Telemed common stock were exercised into Class A common stock resulting in 1,169,452 shares of Class A common stock. ● The Company issued 11,468,485 shares of Class A common stock and the Sponsor Earnout Shares to the former stockholders of HCMC for $ 64.6 million in cash. ● The Company issued 16,800,000 Class A common shares for $168,000,000 through the PIPE, as discussed in Note 4. Apart from the above Merger Transaction related activity, common warrants of Legacy SOC Telemed were exercised during 2020 resulting in 40,795 new shares of Legacy SOC Telemed common stock shares being issued prior to the Merger Transaction. Warrants to Acquire Common Stock Number of warrants and exercise prices were converted using an exchange ratio of 0.4047 as a result of the Merger Transaction. Warrants to acquire a maximum of 12,849,992 and 1,146,340 shares of the Company's common stock were outstanding as of December 31, 2020 and 2019, respectively. The key provisions of the warrant agreements and related impacts to the Company's consolidated financial statements are summarized as follows: 2014 Common Warrants During 2014, the Company issued warrants to acquire a maximum 101,175 shares of the Company's common stock. The warrants were exercisable at $19.77 per share from the date of issuance through November 2018 and November 2019. Upon a Qualifying Change of Control, as defined within the warrant agreement, the warrants were exercisable at a price of $14.31 per share. These options expired unexercised in November 2019. 2015 Common Warrants During 2015 in connection with the Series H financing, the Company converted 123,432 Series G warrants into 851,718 common warrants. Each warrant gave the holder the right to purchase 1 share of the Company's common stock at an exercise price of $2.87 per share. The warrants were exercisable through November 2022. All 2015 common warrants were exercised during 2020, as part of the Merger Transaction. Therefore, there were no 2015 common warrants remaining as of December 31, 2020. As of December 31, 2019, 851,718 of the 2015 common warrants remained outstanding. 2016 Common Warrants During 2016 the Company issued 2,024 common warrants. Each warrant gave the holder the right to purchase 1 share of the Company's common stock at an exercise price of $0.49 per share. The warrants were exercisable from the date of issuance through December 2019. All 2,024 warrants were exercised during 2019. As of December 31, 2020, and 2019, 0 and 0 of the 2016 common warrants remained outstanding, respectively. 2017 and 2018 Series I Common Warrants During 2017, in conjunction with the Series I financing, the Company issued 62,057 common warrants. Each warrant gave the holder the right to purchase 9 shares of the Company's common stock at an exercise price of $0.02 per share. The warrants were exercisable from the date of issuance through November and December 2022. During 2018, the Company issued an additional 124,105 Series I common warrants under the same terms, exercisable through April and August 2023. All 2017 and 2018 Series I Common Warrants were exercised during 2020, as part of the Merger Transaction. Therefore, there were no Series I Common warrants remaining as of December 31, 2020. As of December 31, 2019, 186,162 of the Series I common warrants remained outstanding. 2019 and 2020 Series J Common Warrants During 2019 in conjunction with the Series J financing, the Company issued 108,460 common warrants. Each warrant gave the holder the right to purchase 11 shares of the Company's common stock for $0.02 per share. The warrants were exercisable from the date of issuance through December 2024. During 2020, the Company issued an additional 120,150 Series J common warrants under the same terms, exercisable from the date of issuance through June 2025. All 2019 and 2020 Series J Common Warrants were exercised during 2020, as part of the Merger Transaction. Therefore, there were no Series J Common Warrants remaining as of December 31, 2020. As of December 31, 2019, 108,460 of the Series J common warrants remained outstanding. 2020 Common Warrants On October 30, 2020, as part of the Merger Transaction, the Company issued 12,849,992 warrants with an exercise price of $11.50. The warrants are exercisable from the date of issuance through October 30, 2025 (the fifth anniversary of the Merger Transaction). At December 31, 2020 all 12,849,992 warrants (12,499,992 public warrants and 350,000 private placement warrants) remain outstanding. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
STOCK-BASED COMPENSATION | 18. STOCK-BASED COMPENSATION Each unvested stock option that was outstanding immediately prior to the Merger Transaction was converted into an option to purchase a number of shares of Class A common stock on terms substantially identical to those in effect prior to the Merger Transaction, except for adjustments to the underlying number of shares and the exercise price based on the exchange ratio of 0.4047. Under the Company's 2014 Equity Incentive Plan (the "2014 Plan"), officers, employees and consultants may be granted options to purchase shares of the Company's authorized but unissued common stock. Options granted under the 2014 Plan may be qualified as incentive stock options or non-qualified stock options. Qualified incentive stock options may only be granted to employees. As part of the Merger Transaction the 2014 Plan was terminated and a new 2020 Equity Incentive Plan (the "2020 Plan" was approved by the Board on October 30, 2020. As a result of the termination no additional grants can be issued under the 2014 Plan. Total number of shares of Common Stock reserved for awards under the 2020 Plan initially equaled 11% of the fully diluted capitalization of the Company as of the closing of the Merger Transaction, or 9,672,709 shares of Class A common stock. The maximum number of Class A common shares available for future grants under the 2020 Plan is 9,672,709 as of December 31, 2020. There were no grants under the 2020 Plan in 2020. The Company's Board of Directors establishes the options' exercise prices, or the methodology used in determining the options' exercise prices. The Company's Board of Directors also establishes the vesting, expiration, and restrictions related to the options granted. Each option has an individual vesting period which varies per option subject to approval from Board of Directors. Generally, options expire after ten years or earlier if the optionee terminates their business relationship with the Company. The weighted-average grant-date fair value of options granted in 2019 was $3.64 per share. No stock options were granted in 2020. The fair value of each grant was estimated on the grant date using the Black-Scholes option pricing model with the following assumptions: 2020 (1) 2019 Weighted-average volatility 80.0% 55.0% Expected dividends 0.0% 0.0% Expected term (in years) 1 - 5 5 - 10 Risk-free interest rate 0.15% - 0.40% 1.98% - 2.64% (1) No new grants issued in 2020 prior to the Merger Transaction. These assumptions relate to option modifications in 2020. During the year ended December 31, 2019, the Company granted options that would vest upon satisfying a performance condition, which was a liquidity event defined as a change in control. Since the Merger Transaction did not meet the definition of a change in control, the Company modified options to purchase 922,221 shares of Class A common stock to provide for the time-based vesting of these awards in connection with the Merger Transaction. As a result of the modification, the Company will recognize $7.4 million in stock-based compensation expense over a weighted-average period of 1.2 years from the date of the Merger Transaction. During the year ended December 31, 2020 the Company modified two option grants such that the period to exercise the options was extended from July 2020 to January 2021. As a result of this modification the Company recognized incremental stock compensation expense of $0.8 million. In connection with the Merger Transaction several awards were granted to current and former Executives of the Company: ● A "Transaction Award" was authorized on August 18, 2020 to the former interim-CEO of the Company. The award was granted in the form of restricted stock units and equaled 1.35% of the fully diluted equity of the Company as of the closing of the Merger Transaction. Since there is no substantive future service requirement post transaction date, the award was fully expensed in 2020 for $10.7 million and included in selling, general and administrative expense in the consolidated statement of operations. ● A "Base Full Value Award" was promised to the current CEO of the Company with the award value of 3% of the Company's outstanding shares at the closing of the Merger Transaction. The final terms of the award were not agreed to as of December 31, 2020; however the award required the Company to pay, in cash, on each applicable vesting (or payment) date the value of the award that would have vested on that date if the Base Full Value Award was not granted within 90 days of the closing of the Merger Transaction. The award had not been granted within 90 days of the closing of the Merger Transaction and the required cash payment was determined to be a liability-based award and was accrued for $4.2 million as of December 31, 2020. The liability was classified as Stock-based compensation liabilities in the balance sheet and included within selling, general and administrative expenses in the statements of operations. ● The CEO of the Company was deemed granted an award of performance stock units equal to 15% of the Sponsor Earnout Shares during 2020 which award includes the same market vesting conditions as the Sponsor Earnout Shares as noted in Note 16. We utilized a Monte Carlo simulation to determine the grant date fair value of $2.7 million. The award resulted in $0.8 million expense for the year ended December 31, 2020. The following table summarizes outstanding restricted stock units ("RSUs") activity in connection with the Merger Transaction: Number of RSUs Weighted Average Outstanding RSUs at December 31, 2019 - - Granted 1,342,570 9.95 Vested (1,061,320 ) (10.06 ) Outstanding RSUs at December 31, 2020 281,250 7.13 Expected RSUs to vest as of December 31, 2020 281,250 $ 7.13 Upon execution of the reverse recapitalization transaction, all vested and in-the-money options were exercised and exchanged for Class A common stock in the Company. The withholding taxes due on the option exercises were net settled and the Company effectively repurchased $11.9 million of Class A common stock. The Company remitted $11.9 million in withholding taxes on behalf of the option holders. The Company recognized $17.9 million and $1.1 million in stock-based compensation expense, which is included selling, general and administrative expenses on the statements of operations, for the years ended December 31, 2020 and 2019, respectively. As of December 31, 2020, the Company had $22.6 million of total unrecognized compensation cost, which is expected to be recognized as stock-based compensation expense over the remaining weighted-average vesting period of approximately 1.6 years. The Company received $0 and less than $0.1 million for the years ended December 31, 2020 and 2019, respectively, for stock options exercised during each year. The intrinsic value of the options exercised was $38.4 million and less than $0.1 million for each of the years ended December 31, 2020 and December 31, 2019. The following table summarizes stock option activity of the Plan for the period from January 1, 2019 through December 31, 2020: Shares Weighted-Average Weighted-Average Remaining Outstanding stock options at December 31, 2018 7,687,698 $ 3.09 7.39 Granted 1,276,490 3.63 Exercised (9,509 ) 2.00 Forfeited or expired (689,738 ) 3.86 Outstanding stock options at December 31, 2019 8,264,941 3.11 6.15 Granted - Exercised (5,546,222 ) 3.13 Forfeited or expired (1,175,557 ) 3.18 Outstanding stock options at December 31, 2020 1,543,162 3.05 7.09 Vested or expected stock options to vest at December 31, 2020 914,445 3.05 7.09 Exercisable at December 31, 2020 13,363 $ 6.53 4.65 The intrinsic value of the outstanding options was $7.4 million and $0 million at December 31, 2020 and December 31, 2019, respectively. |
Employee Retirement Plans
Employee Retirement Plans | 12 Months Ended |
Dec. 31, 2020 | |
Compensation Related Costs [Abstract] | |
EMPLOYEE RETIREMENT PLANS | 19. EMPLOYEE RETIREMENT PLANS The Company sponsors a 401(k) defined contribution retirement plan for the benefit of its employees, substantially all of whom are eligible to participate after meeting minimum qualifying requirements. Contributions to the plan are at the discretion of the Company. For the years ended December 31, 2020 and 2019, the Company contributed $1.2 million and $1.0 million to the plan, respectively. |
Net Loss Per Share
Net Loss Per Share | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
NET LOSS PER SHARE | 20. NET LOSS PER SHARE Basic net loss per share is computed by dividing the net loss by the weighted-average number of shares of common stock of the Company outstanding during the period. Diluted net loss per share is computed by giving effect to all potential shares of common stock of the Company, including outstanding stock options, warrants and contingently redeemable preferred stock, to the extent dilutive. Basic and diluted net loss per share was the same for each period presented as the inclusion of all potential shares of common stock of the Company outstanding would have been anti-dilutive. As a result of the Merger, the Company has retrospectively adjusted the weighted-average number of shares of common stock outstanding prior to October 30, 2020 by multiplying them by the exchange ratio of 0.4047 used to determine the number of shares of Class A common stock into which they converted. The following table presents the calculation of basic and diluted net loss per share for the Company's common stock (in thousands, except shares and per share amounts): Year Ended 2020 2019 Numerator: Net loss $ (49,847 ) $ (18,242 ) Preferred stock dividends (96,974 ) (5,514 ) Numerator for Basic and Dilutive EPS –Loss available to common stockholders $ (146,821 ) $ (23,756 ) Denominator: Common stock 41,102,162 34,042,596 Series I and Series J Common Warrants 244,687 191,193 Denominator for Basic and Dilutive EPS – Weighted-average common stock outstanding 41,346,849 34,233,789 Basic net loss per share $ (3.55 ) $ (0.69 ) Diluted net loss per share $ (3.55 ) $ (0.69 ) Since the Company was in a net loss position for all periods presented, net loss per share attributable to common stockholders was the same on a basic and diluted basis, as the inclusion of all potential common equivalent shares outstanding would have been anti-dilutive. Anti-dilutive common equivalent shares were as follows: 2020 2019 Outstanding convertible Series H preferred stock - 8,814,825 Outstanding common warrants 12,849,992 851,627 Outstanding options to purchase common stock 1,543,162 8,264,941 Unvested Sponsor earn-out shares 1,875,000 - Total anti-dilutive common equivalent shares 16,268,154 17,931,393 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 21. COMMITMENTS AND CONTINGENCIES Commitments In 2020, the Company leased three separate facilities under non-cancelable operating agreements expiring on September 30, 2020, December 31, 2021, and October 31, 2022, respectively. The lease agreement expired in September 2020 was not renewed. Rent expense is recognized on the straight-line method over the life of the lease and was approximately $0.6 million and $0.7 million for the years ended December 31, 2020 and 2019, respectively. Rent expense is included in selling, general and administrative expenses on the statements of operations. The Company also leased telemedicine and office equipment under various non-cancelable operating leases through February 2021. Rent expense under these leases was less than $0.1 million and $0.2 million for the years ended December 31, 2020 and 2019, respectively, and included in cost of revenues on the statements of operations. The Company also leased office equipment under various non-cancelable operating leases through December 2019. Rent expense under these leases was $0 million and less than $0.1 million for the years ended December 31, 2020 and 2019, respectively, and included in selling, general and administrative expenses on the statements of operations. There was no sublease income for the years ended December 31, 2020 and 2019. There were no future minimum sublease payments to be received under non-cancelable subleases as of September 30, 2020. The following reflects the future minimum non-cancelable lease payments required under the above operating leases (in thousands): Years ending December 31, Amount 2021 $ 543 2022 and thereafter 33 Contingencies The Company is involved in litigation and legal matters which have arisen in the normal course of business, including but not limited to medical malpractice matters. Although the ultimate results of these matters are not currently determinable, management does not expect that they will have a material adverse effect on the Company's consolidated statements of financial position, results of operations, or cash flows. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | 22. INCOME TAXES Income tax expense equals the current tax payable or refundable for the period plus or minus the change during the period in deferred tax assets and liabilities during the year. The provision for income taxes for the years ended December 31, 2020 and 2019 is as follows (in thousands): 2020 2019 Current: Federal $ - $ - State (31 ) (8 ) $ (31 ) $ (8 ) Deferred: Federal $ - $ - State - - $ - $ - Income tax expense $ (31 ) $ (8 ) Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial statements purposes and the amounts used for income tax purposes. Components of the Company's net deferred tax asset balance are as follows at December 31 (in thousands): 2020 2019 Deferred tax assets: Net operating loss carryforwards $ 56,300 $ 40,110 Deferred revenue 171 69 Deferred rent - 14 Stock options and warrants 22 298 Restricted stock units 315 - Other 426 654 Total deferred tax assets 57,234 41,145 Less: valuation allowance (53,513 ) (37,280 ) Net deferred tax assets before deferred tax liabilities 3,721 3,865 Deferred tax liabilities: Intangible assets (1,448 ) (1,882 ) Property and equipment (74 ) (17 ) Capitalized software costs and other (2,199 ) (1,966 ) Total deferred tax liabilities (3,721 ) (3,865 ) Net deferred tax assets $ - $ - The Company's tax rate reconciliation for the years ended December 31 is as follows: 2020 2019 Statutory US federal rate 21.0 % 21.0 % Stock-based compensation 14.8 % (1.0 %) Sec.162(m) (6.1 %) 0.0 % State and local income taxes 1.3 % 0.9 % Change in valuation allowance (32.6 %) (22.9 %) Other 1.5 % 2.0 % Effective tax rate (0.1 %) 0.0 % As of December 31, 2020, the Company had approximately $232.9 million of federal net operating loss carryforwards and $182.9 million gross state net operating loss carryforward. The federal net operating loss carryforwards of $111.9 million generated subsequent to the year ended December 31, 2017 carry forward indefinitely, while the remaining federal net operating loss carryforwards of $121 million begin to expire in 2025. The realizability of the deferred tax assets, generated primarily from net operating loss carryforwards, is dependent upon future taxable income generated during the periods in which net operating loss carryforwards are available. Management considers projected future taxable income and tax planning strategies, which can be implemented by the Company in making this assessment. Since the history of cumulative losses provides strong evidence that it is not more likely than not that future taxable income will be generated in the periods net operating losses are available, management has established a valuation allowance equal to the net deferred tax assets. In general, under Section 382 of the U.S. Internal Revenue Code of 1986, as amended, or the Code, a corporation that undergoes an "ownership change" is subject to limitations on its ability to utilize its pre-change net operating losses, or NOLs, to offset future taxable income. A Section 382 "ownership change" generally occurs if one or more stockholders or groups of stockholders who own at least 5% of the corporation's stock increase their ownership by more than 50 percentage points over their lowest ownership percentage within a rolling three-year period. Similar rules may apply under state tax laws. The Company's ability to utilize NOLs may be currently subject to limitations due to prior ownership changes. In addition, future changes in the Company's stock ownership, some of which are outside of its control, could result in an ownership change under Section 382 of the Code, further limiting the Company's ability to utilize NOLs arising prior to such ownership change in the future. There is also a risk that due to regulatory changes, such as suspensions on the use of NOLs, or other unforeseen reasons, the Company's existing NOLs could expire or otherwise be unavailable to offset future income tax liabilities. The Company has recorded a full valuation allowance against the deferred tax assets attributable to its NOLs that are not more likely than not expected to be utilized. The Company has not completed an analysis under Section 382 and will complete such analysis prior to utilizing any of the affected tax attributes in future periods. The Company has performed a tax analysis for the years ended December 31, 2020 and 2019 and believes there are no material uncertain tax positions. There is no unrecognized income tax benefit for the years ended December 31, 2020 and 2019, and the Company does not anticipate any material changes in its unrecognized tax benefits in the next twelve months. The Company is subject to taxation in the U.S. and various state and local jurisdictions. Due to its net operating loss carryforwards, the Company's income tax returns generally remain subject to examination by federal and most state tax and local tax authorities from tax year 2005 forward. On March 27, 2020, the United States enacted the Coronavirus Aid, Relief and Economic Security Act (CARES Act). The CARES Act is an emergency economic stimulus package that includes spending and tax breaks to strengthen the United States economy and fund a nationwide effort to curtail the effect of COVID-19. While the CARES Act provides sweeping tax changes in response to the COVID 19 pandemic, some of the more significant provisions which are expected to impact the Company's financial statements include removal of certain limitations on utilization of net operating losses, increasing the loss carryback period for certain losses to five years, and increasing the ability to deduct interest expense, as well as amending certain provisions of the previously enacted Tax Cut and JOBS Act. Due to the Company's valuation allowance position, the CARES Act has no impact on the Company's accounting for income taxes. The Company will continue to evaluate the impact of the tax changes from the CARES Act. |
Related-Party Transactions
Related-Party Transactions | 12 Months Ended |
Dec. 31, 2020 | |
Related Party Transactions [Abstract] | |
RELATED-PARTY TRANSACTIONS | 23. RELATED-PARTY TRANSACTIONS Founder Shares In October 2019, HCMC Sponsor LLC purchased 5,750,000 shares (the "Founder Shares") of the HCMC's Class B common stock for an aggregate price of $25,000. On December 12, 2019, HCMC effected a 1.1 for 1 stock dividend for each Founder Share outstanding, resulting in the Sponsor holding an aggregate of 6,325,000 Founder Shares. The Founder Shares automatically converted into Class A common stock upon consummation of our Merger Transaction. The Founder Shares included an aggregate of up to 825,000 shares subject to forfeiture to the extent that the underwriters' over-allotment option was not exercised in full or in part. As a result of the underwriter's election to partially exercise their over-allotment option, 75,000 Founder Shares were forfeited. On October 30,2020, the Company modified the terms of 1,875,000 of the Founder Shares held by HCMC Sponsor LLC such that 50% of such shares will be forfeited if the share price of Class A common stock does not reach $12.50 for 20 out of 30 consecutive trading days and 50% of such shares will be forfeited if the share price of Class A common stock does not reach $15.00 for 20 out of 30 consecutive trading days, in each case, prior to the seventh anniversary of the Closing (See Note 16). Preferred stock and debt In 2020, Legacy SOC Telemed issued 11,000 shares of Series J contingently redeemable preferred stock to certain previous Legacy SOC Telemed stockholders in exchange for cash consideration (see Note 15). On August 14, 2020, two entities affiliated with WP signed a support letter committing funds up to $15.0 million available to Legacy SOC Telemed from August 2020 through December 2021. On September 3, 2020, Legacy SOC Telemed sold to WP $2.0 million aggregate principal amount of subordinated convertible promissory notes in a financing pursuant to this support letter. WP subsequently recommitted to fund up to $15.0 million available from September 2020 through December 31, 2021, subject to ongoing evaluations between the parties following the closing of the Merger Transaction, under a new support letter dated September 23, 2020, that superseded and replaced the August support letter (see Note 11). As discussed in Note 25, the support letter was terminated in connection with the acquisition of Access Physicians. Legacy SOC Telemed also entered into a convertible bridge note purchase agreement with certain previous Legacy SOC Telemed stockholders which permitted Legacy SOC Telemed to borrow aggregate principal in the amount of $8.0 million. Legacy SOC Telemed borrowed $6.0 million of principal pursuant to such convertible bridge note purchase agreement in 2020 (see Note 11). In 2019 Legacy SOC Telemed issued 4,000 shares of Series J contingently redeemable preferred stock to its controlling stockholders in exchange for cash consideration (see Note 15). As discussed in Notes 11 and 15, all existing debt and preferred stock owned by our controlling stockholders was liquidated in connection with the closing of the Merger Transaction on October 30, 2020. |
Valuation and Qualifying Accoun
Valuation and Qualifying Accounts | 12 Months Ended |
Dec. 31, 2020 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
VALUATION AND QUALIFYING ACCOUNTS | 24. VALUATION AND QUALIFYING ACCOUNTS The table below details the activity of the allowance for doubtful accounts and deferred tax asset valuation allowance for the years ended December 31, 2020 and 2019 (in thousands): Balance at the beginning of the period Additions Deductions Balance at the end of the period Year ended December 31, 2019 Allowance for doubtful accounts $ 373 200 (35 ) $ 538 Deferred tax asset valuation allowance 33,097 4,802 (619 ) 37,280 Year ended December 31, 2020 Allowance for doubtful accounts $ 538 85 (176 ) $ 447 Deferred tax asset valuation allowance 37,280 17,041 (808 ) 53,513 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2020 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 25. SUBSEQUENT EVENTS The Company evaluated its financial statements for subsequent events through March 30, 2021, the date the financial statements were available to be issued. The Company is not aware of any subsequent events which would require recognition or disclosure in the financial statements except as discussed below. In January and February 2021, the Company granted an aggregate of 3,589,248 and 2,349,489, respectively, of restricted and performance stock units to officers, directors, and employees of the Company. Based upon the terms of the award agreements, the restricted stock units will vest over a period of one to five years, subject to the grantee's continued service on each applicable vesting date and the achievement of the applicable performance criteria. The performance stock units will vest if shares of the Company's Class A common stock reach volume-weighted average closing sale prices of $12.50, $15.00, $17.50 or $20.00 for 20 out of 30 consecutive trading days, in each case, prior to the third anniversary of the grant date. In February 2021, the Company amended the terms of the employment agreement with its CEO to replace the liability based award with a restricted stock award based on 3% of the Company's outstanding shares at the closing of the Merger Transaction. On March 26, 2021, the Company entered into an equity purchase agreement (the "Agreement") to acquire Access Physicians Management Services Organization, LLC ("Access Physicians"). Pursuant to the Agreement, SOC Telemed acquired Access Physicians with a combination of 40% cash, 43% shares, and 17% contingent consideration to be paid in cash, shares or a combination of cash and shares, at the Company's election, for aggregate purchase consideration of approximately $234 million. The contingent consideration, if earned, would be payable upon the achievement of certain milestones agreed upon with Access Physicians. The terms of the Agreement contain customary representations, warranties, covenants, closing conditions, termination fee provisions and other terms relating to the transactions contemplated. In order to consummate the acquisition and support the combined business after the transaction, SOC Telemed entered into a term loan facility and a related-party subordinated financing with Warburg Pincus for $100.0 million and $13.5 million, respectively, with maturities of 2026 and 2026, respectively. Additionally, the pre-existing WP support letter was terminated in conjunction with this financing. Due to the timing of the acquisition, the initial accounting for the acquisition, including the valuation of the contingent consideration, is incomplete. As such, the Company is not able to disclose certain information relating to the acquisition including the aggregate fair value of the purchase consideration and the preliminary fair value of assets acquired and liabilities assumed. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements include the accounts of SOC Telemed, Inc. and its Subsidiaries and Affiliates and have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP" or "GAAP") and pursuant to the accounting and disclosure rules and regulations of the Securities and Exchange Commission (the "SEC"). As of December 31, 2020 and 2019, SOC Telemed, Inc. is party to four Administrative Agreements in Georgia, California, Texas and New Jersey by and among it and the professional corporations (the "Tele-Physicians Practices") pursuant to which each professional corporation provides services to SOC Telemed, Inc. Each Tele-Physician Practice is established pursuant to the requirements of its respective domestic jurisdiction governing the corporate practice of medicine. As discussed in Note 5, Variable Interest Entities, SOC Telemed, Inc. holds a variable interest in the Tele-Physician Practices and, accordingly, the Tele-Physician Practices are considered variable interest entities ("VIE" or "VIEs") which are denominated Affiliates for consolidation purposes. The accompanying consolidated financial statements include the accounts of the Company. All intercompany balances and transactions are eliminated upon consolidation. The Merger Transaction was accounted for as a reverse recapitalization as Legacy SOC Telemed was determined to be the accounting acquirer under Financial Accounting Standards Board's Accounting Standards Codification Topic 805, Business Combinations. This determination was primarily based on Legacy SOC Telemed comprising the ongoing operations of the combined entity, Legacy SOC Telemed's senior management comprising the majority of the senior management of the combined company, and the prior shareholders of Legacy SOC Telemed having a majority of the voting power of the combined entity. In connection with the Merger Transaction, the outstanding shares of Legacy SOC Telemed preferred stock was redeemed for cash and shares of the Company's Class A common stock and the outstanding shares of Legacy SOC Telemed common stock were converted into Class A common stock of the Company, representing a recapitalization, and the net assets of the Company were acquired at historical cost, with no goodwill or intangible assets recorded. Operations and assets and liabilities of the Company prior to the Merger Transaction in these financial statements are those of Legacy SOC Telemed. As a result, these financial statements represent the continuation of Legacy SOC Telemed and the historical shareholders' deficit exclusive of common stock and loss per share of Legacy SOC Telemed prior to the Merger Transaction have been retrospectively adjusted for the Merger Transaction using an exchange ratio of 0.4047. The accumulated deficit of Legacy SOC Telemed has been carried forward after the Merger Transaction. See Note 4 for additional information. |
COVID – 19 Outbreak | COVID – 19 Outbreak The recent outbreak of the novel coronavirus ("COVID-19"), which was declared a pandemic by the World Health Organization on March 11, 2020 and declared a National Emergency by the President of the United States on March 13, 2020, has led to adverse impacts on the U.S. and global economies and created uncertainty regarding potential impacts on the Company's operating results, financial condition and cash flows. The full extent to which the COVID-19 pandemic will directly or indirectly impact the Company's business, results of operations and financial condition, including expenses and research and development costs, will depend on future developments that are highly uncertain, including as a result of new information that may emerge concerning COVID-19 and the actions taken to contain or treat COVID-19, as well as the economic impacts. While not currently known, the full impact of COVID-19 could have a material impact on the operations of our business. For the year ended December 31, 2020 our variable revenues decreased as a result of the lower volume of consultations due to the COVID-19 pandemic with corresponding impacts on our cost of sales due to declined demand for physicians. For more details, see Going Concern Consideration below. The Company continues to closely monitor the current macro environment related to monetary and fiscal policies, as well as pandemics or epidemics, such as the recent COVID-19 outbreak. |
Going Concern Consideration | Going Concern Consideration Under Accounting Standards Update ("ASU") 2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40) ("ASC 205-40"), the Company has the responsibility to evaluate whether conditions and/or events raise substantial doubt about its ability to meet its future financial obligations as they become due within one year after the date that the financial statements are issued. As required by ASC 205-40, this evaluation shall initially not take into consideration the potential mitigating effects of plans that have not been fully implemented as of the date the financial statements are issued. As of December 31, 2020, the Company has experienced negative cash flows and losses from operations each year since inception and has an accumulated deficit of $236.2 million. The Company incurred net losses of $49.8 million and $18.2 million for the years ended December 31, 2020 and 2019, respectively, and cash outflows from operations of $22.6 million and $10.8 million for the years ended December 31, 2020 and 2019, respectively. In March 2020, the World Health Organization declared the 2019 novel coronavirus, or COVID-19, a global pandemic. The Company experienced a reduction in service utilization in and around the same time and consequently experienced a decrease in revenue and margin. The Company immediately responded by adjusting variable costs, including physician fees, travel expenses, and other discretionary spending to preserve margins which included real time assessment of physician coverage needs to appropriately align with changes in utilization experienced as a result of the COVID-19 pandemic. The Company is closely monitoring the impact of the COVID-19 pandemic on all aspects of the business and continuously modifying operational protocols, cost structure, and discretionary spending to evolving business conditions. Notwithstanding these efforts, the Company expects that its operating losses and negative cash flows will continue for the foreseeable future. The Company expects that its cash and cash equivalents of $38.8 million as of December 31, 2020 and cash proceeds of $96.5 million received through the issuance of debt in March 2021 will be sufficient to fund its operating expenses, capital expenditure requirements and debt service obligations for at least the next 12 months from the issuance of these financial statements, based upon the Company's current operating plan and its acquisition of Access Physicians Management Services Organization, LLC ("Access Physicians") in March 2021. The future viability of the Company beyond that point is dependent on its ability to raise additional capital to finance its operations. The Company has historically funded its operations through the issuance of preferred stock and long-term debt. Until such time, if ever, as the Company can generate substantial revenues and positive operating cash flows, the Company will likely finance its cash needs through a combination of public or private equity offerings or debt financings. The Company may not be able to obtain funding on acceptable terms, or at all. If the Company is unable to raise additional funds as and when needed, it would have a negative impact on the Company's financial condition, which may require the Company to delay, reduce or eliminate certain activities and reduce or eliminate discretionary operating expenses, which could constrain the Company's ability to pursue its business strategies. |
Concentration of credit risk | Concentration of credit risk Financial instruments which potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable. The Company maintains its cash and cash equivalents with high-credit quality financial institutions. At times, such amounts may exceed federally insured limits. For the years ended December 31, 2020 and 2019 no client accounts for more than 10% of the Company's accounts receivable or total revenues. |
Business Combination | Business Combination The Company applies the acquisition method of accounting for business acquisitions. The results of operations of the businesses acquired by the Company are included as of the respective acquisition date. The Company allocates the fair value of purchase consideration to the assets acquired and liabilities assumed, based on their estimated fair values. The excess of the fair value of purchase consideration over the value of these identifiable assets and liabilities is recorded as goodwill. When determining the fair value of assets acquired and liabilities assumed, management makes significant estimates and assumptions, especially with respect to the fair value of acquired intangible assets. The Company may adjust the preliminary purchase price allocation, as necessary, for up to one year after the acquisition closing date if it obtains more information regarding asset valuations and liabilities assumed. Acquisition-related expenses are recognized separately from the business combination and are expensed as incurred. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with a maturity at the date of purchase of three months or less to be cash equivalents. |
Accounts Receivable | Accounts Receivable The Company carries its accounts receivable at net realizable value. The Company maintains an allowance for doubtful accounts for the estimated losses resulting from the inability of the Company's clients to pay their invoices. The allowance for doubtful accounts is calculated based on a specific reserve for identified at risk balances considering the Company's history of write-offs and collections as well as current credit conditions. If the financial condition of the Company's clients were to deteriorate, resulting in an impairment of their ability to make payments, additional allowances may be required. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost less accumulated depreciation. The cost of property and equipment acquired under capital lease arrangements represents the lesser of the present value of the minimum lease payments or the fair value of the leased asset as of the inception of the lease. Depreciation expense is computed using the straight-line method over the estimated useful lives of the related assets as follows: Software 3 years Computer Equipment 3 years Furniture and Fixtures 3 years Telemedicine Equipment 2 to 5 years Leasehold Improvements Shorter of remaining lease term or the economic life Depreciation of leasehold improvements is computed using the shorter of the remaining lease term or the economic life. Telemedicine equipment consists of computer equipment and monitors, optical equipment, and accessories that allow doctors and others in separate locations to communicate and collaborate with each other. Depreciation expense for telemedicine equipment and software is included within cost of revenues, while depreciation for all other assets is included within selling, general and administrative expenses in the statements of operations. Upon installation of the telemedicine equipment at the client's location, the Company retains title to the equipment, which is held and used by the client and thus is retained on the Company's books or financed through operating and capital leases with third parties. Telemedicine equipment that has not yet been installed is not depreciated. At December 31, 2020 and 2019 the Company has $0.1 million and $0.2 million of uninstalled telemedicine equipment classified as work in progress within Property and equipment, net on the consolidated balance sheets. Expenditures for major renewals and improvements are capitalized. Expenditures for repairs and maintenance are charged to expense as incurred and included within selling, general and administrative expenses in the statements of operations. |
Capitalized Software Costs | Capitalized Software Costs The Company capitalizes the cost of developing internal-use software, consisting primarily of personnel and related expenses (including stock-based compensation and employee taxes and benefits) for employees and third parties who devote time to their respective projects. The Company also capitalizes avoidable interest costs as the amount of interest that could have been avoided if funds were used to pay off the debt instead of developing the asset. Capitalized interest costs were $0.1 million for each of the years ended December 31, 2020 and 2019. Capitalization of software costs occurs during the application development stage. Software costs incurred during the preliminary project and post implementation stages are expensed as incurred. The application development stage occurs when the research stage is complete and management has committed to a project to develop software that will be used for its intended purpose. Any costs incurred during subsequent efforts to significantly upgrade and enhance the functionality of the software are also capitalized. Depreciation of capitalized software costs are recorded as a component of telemedicine equipment and software depreciation within cost of revenues on the statements of operations on a straight-line basis over their estimated useful life of four years and begins once the project is substantially complete and the software is ready for its intended purpose. |
Intangibles Assets | Intangibles Assets All intangible assets were acquired in connection with the acquisitions of NeuroCall Holdings, LLC and its subsidiaries ("NeuroCall") on January 31, 2017, and JSA Health Corporation ("JSA Health" or "JSA") on August 14, 2018 and are amortized over their estimated useful lives based on the pattern of economic benefit derived from each asset. Intangible assets resulting from these acquisitions include hospital contracts relationships, non-compete agreements and trade names. Hospital contracts relationships are amortized over a period of 6 to 10 years using a straight-line method. Non-compete agreements are amortized over a period of 4 to 5 years using the straight-line method. The trade names represented by NeuroCall and JSA Health are amortized over 5 and 4 years, respectively, using the straight-line method. |
Impairment of Goodwill | Impairment of Goodwill Goodwill is tested for impairment on an annual basis as of December 31 or between annual tests if events occur or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. The Company operates as one operating segment, which the Company has determined to be one reporting unit for the purposes of impairment testing. The Company compares the estimated fair value of a reporting unit to its book value, including goodwill. If the fair value exceeds book value, goodwill is considered not to be impaired and no additional steps are necessary. However, if the book value of a reporting unit exceeds its fair value, an impairment loss will be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. The fair value of the reporting unit is determined using various techniques, including market cap determined from the public stock price, multiple of earnings and discounted cash flow valuation methodologies. Determining the fair value of the reporting unit is judgmental in nature and involves the use of significant estimates and assumptions. These estimates and assumptions include changes in revenue and operating margins used to project future cash flows, discount rates, valuation multiples of entities engaged in the same or similar lines of business, and future economic and market conditions. The Company's annual goodwill impairment tests performed on December 31, 2020 and 2019 resulted in no impairment charges for the years ended December 31, 2020 and 2019. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company determines whether long-lived assets are to be held for use or disposal. The Company monitors its long-lived assets for events or changes in circumstances that indicate that their carrying values may not be recoverable. Upon indication of possible impairment of long-lived assets held for use, the Company evaluates the recoverability of such assets by measuring the carrying amount of the long-lived asset group against the related estimated undiscounted future cash flows of the long-lived asset group. When an evaluation indicates that the future undiscounted cash flows are not sufficient to recover the carrying value of the asset, the asset is adjusted to its estimated fair value. No impairments were recorded during the years ended December 31, 2020 and 2019. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for all employee stock-based payments in accordance with the provisions of Accounting Standards Codification ("ASC") 718, Compensation-Stock Compensation. This model requires companies to measure the cost of stock-based awards to employees based on the grant-date fair value of the award using an option pricing model, and to recognize that cost over the period during which an employee is required to provide service in exchange for the award. An award's value is expensed over the award's requisite service period, which is generally the vesting period, on a straight-line basis or on a graded basis as determined by the underlying award, net of estimated pre-vesting forfeitures. The Company has estimated forfeitures based on historical experience and revises the rates, as necessary, if actual forfeitures differ from initial estimates. The Company estimates the grant-date fair value of each award using the Black-Scholes model. Assumptions used when valuing options using the Black-Scholes model are: the underlying stock price, expected stock volatility, expected option term, expected dividend yield, and the risk-free interest rate. Expected stock volatility is determined using weekly average historical stock prices of comparable public companies' common stock for a period generally equal to the expected term of the options. Expected option term is determined by computing the weighted average of an award's contractual and vesting terms, also known as the simplified method. The Company does not have a history of declaring dividends on common stock and does not expect to in the near term, therefore, the dividend yield is 0%. The risk-free interest rate is equal to interest rates paid on U.S. treasuries for periods equal to the expected term. |
Long Term Debt | Long Term Debt The Company previously had entered into a term loan facility, which is divided into tranches. The Company capitalized costs related to the issuance of debt under the provisions of ASC Subtopic 835-30, Interest – Imputation of Interest . |
Contingent Shares Issuance Liabilities and Puttable Option Liabilities | Contingent Shares Issuance Liabilities and Puttable Option Liabilities The Company recognizes derivatives as either an asset or liability measured at fair value in accordance with ASC 815, Derivatives and Hedging. The puttable options were the Company's derivative financial instruments and were recorded in the consolidated balance sheets at fair value. The Company does not enter into derivative transactions for speculative or trading purposes. Contingent shares issuance liabilities reflect the Company's liability to provide a variable number of shares to HCMC's sponsor and its permitted transferees, if certain publicly traded stock prices are met at various points in time. The liability was recorded at fair value at the date of the Merger Transaction and is revalued at each reporting period using a Monte Carlo simulation that factors in the current price of the Company's Class A common stock, the estimated likelihood of a change in control, and the vesting criteria of the award. |
Contingently Redeemable Preferred Stock | Contingently Redeemable Preferred Stock The redemption provisions of the Company's Series H, I and J preferred stock were outside the Company's control, and as such the Company has recorded its contingently redeemable preferred stock outside of stockholders' deficit. The Company's outstanding contingently redeemable preferred stock was issued at a discount to its redemption price. The discount reflects stock issuance costs which were recorded as a reduction of the preferred share balance as well as cumulative dividends on the Series H, I and J preferred stock. The Company accreted its contingently redeemable preferred stock to the stock's redemption value over the period from issuance to the earliest redemption date, such that the carrying amount of the securities would equal the redemption value inclusive of accrued but unpaid dividends at the earliest redemption date. The accretion to redemption value for the Company's Series H, I and J preferred stock were recorded as a charge to additional paid-in capital, in the absence of retained earnings, with a corresponding increase to contingently redeemable preferred stock. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue using a five-step model: 1) Identify the contract(s) with a client; 2) Identify the performance obligation(s) in the contract; 3) Determine the transaction price; 4) Allocate the transaction price to the performance obligations in the contract; and 5) Recognize revenue when (or as) it satisfies a performance obligation. The Company enters into service contracts with hospitals or hospital systems, physician practice groups, and other users. Under the contracts, the clients pay a fixed monthly fee for physician consultation services. The fixed monthly fee provides for a predetermined number of monthly consultations. Should the number of consultations exceed the contracted amount, the clients also pay a variable consultation fee for the additional service. To facilitate the delivery of the consultation services, the facilities use telemedicine equipment, which can be provided and installed by the Company. The Company also provides the hospitals with user training, maintenance and support services for the telemedicine equipment used to perform the consultation services. Prior to the start of a contract, clients generally make upfront nonrefundable payments to the Company when contracting for Company training, maintenance, equipment, and implementation services. Our client contracts typically range in length from 1 to 3 years, with an automatic renewal process. We typically invoice our clients for the monthly fixed fee in advance. Our contracts typically contain cancellation clauses with advance notice, therefore, we do not believe that we have any material outstanding commitment for future revenues beyond one year from the end of a reporting period. Revenues are recognized when the Company satisfies its performance obligation to stand ready to provide telemedicine consultation services as requested. The consultations covered by the fixed monthly fee and obligation to stand-by and be ready to provide these consultations represented 70% and 62% of revenues for the years ended December 31, 2020 and 2019, respectively. Consultations that incur a variable fee due to the monthly quantity exceeding the number of consultations in the contract represented 30% and 38% for the years ended December 31, 2020 and 2019, respectively. The remainder of the revenues was attributable to monthly or annual technology and support fees, and the amortization of deferred revenues for implementation services. Upfront nonrefundable fees do not result in the transfer of a promised goods or service to the client, therefore, the Company defers this revenue and recognizes it over the average client life of 48 months. Deferred revenue consists of the unamortized balance of nonrefundable upfront fees and maintenance fees which are classified as current and non-current based on the timing of when the Company expects to recognize revenue. The Company recognized $1.1 million and $1.2 million for the years ended December 31, 2020 and 2019, respectively, of revenue into the income statement that had previously been deferred and recorded on the balance as a deferred revenue liability. |
Advertising | Advertising Advertising costs include public relations, trade shows, market research, and general promotional items and are expensed as incurred. The Company has recorded advertising expenses of $0.9 million and $0.7 million within selling, general and administrative expenses in the statements of operations for the years ended December 31, 2020 and 2019. |
Income Taxes | Income Taxes The Company follows the asset and liability method of accounting for income taxes under ASC 740, Income Taxes. Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. The Company recognizes interest and penalties associated with tax matters as part of income tax expenses and includes accrued interest and penalties with the related tax liability in the consolidated balance sheets. Significant judgement is required to evaluate uncertain tax positions. The Company evaluates its uncertain tax positions on a regular basis. Its evaluations are based on a number of factors, including changes in facts and circumstances, changes in tax law, correspondence with tax authorities during the course of audits, and effective settlement of audit issues. The Company accounts for uncertain tax positions by recognizing a tax benefit or liability at the largest amount that, in its judgement, is more than 50% likely to be realized or paid based upon technical merits of the position. |
Contingencies | Contingencies In accordance with ASC 450, Accounting for Contingencies, the Company records accruals for such loss contingencies when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. Significant judgement is required to determine both the probability and the estimated amount. The Company reviews contingencies at least quarterly and adjusts accordingly to reflect the impact of negotiations, settlements, rulings, advice of legal counsel, and updated information. At this time, the Company has no accrual related to lawsuits, claims, investigations and proceedings. |
Use of estimates and judgements | Use of estimates and judgements The preparation of the consolidated financial statements in conformity with U.S. GAAP requires the Company to make estimates and assumptions about future events that affect the amounts reported in its consolidated financial statements and the accompanying notes. Future events and their effects cannot be determined with certainty. On an ongoing basis, management evaluates these estimates, judgments and assumptions. Significant estimates and assumptions are included within, but not limited to: (1) revenue recognition, including the determination of the client relationship period, (2) accounts receivable and allowance for doubtful accounts, (3) long-lived asset recoverability, (4) useful lives of long-lived and intangible assets, (5) stock-based compensation, option and warrant liabilities, (6) fair value of identifiable purchased tangible and intangible assets in a business combination, (7) market cap determined from the public stock price for goodwill impairment testing, (8) fair value measurements, and (9) the provision for income taxes and related deferred tax accounts. The Company bases these estimates on historical and anticipated results and trends and on various other assumptions that the Company believes are reasonable under the circumstances, including assumptions as to future events. Actual results could differ from those estimates, and any such differences may be material to the Company's consolidated financial statements. The Company is unable to predict the full impact that COVID-19 will have on its financial position, operating results, and cash flows due to numerous uncertainties. The extent to which COVID-19 impacts the Company's results will depend on future developments, which are highly uncertain and cannot be predicted, including new information that may emerge concerning the severity of COVID-19 and the actions to contain the virus or treat its impact, among others. The Company's consolidated financial statements presented herein reflect the latest estimates and assumptions made by management that affect the reported amounts of assets and liabilities and related disclosures as of the date of the consolidated financial statements and reported amounts of revenue and expenses during the reporting periods presented. Actual results may differ significantly from these estimates and assumptions. |
Emerging Growth Company | Emerging Growth Company As an emerging growth company ("EGC"), the Jumpstart Our Business Startups Act ("JOBS Act") allows the Company to delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are applicable to private companies. The Company has elected to use the extended transition period under the JOBS Act until such time the Company is not considered to be an EGC. The adoption dates are discussed in the section below to reflect this election. The Company is also a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. The Company will remain a smaller reporting company until the last day of the fiscal year in which (i) the market value of the Class A common stock held by non-affiliates exceeds $250 million as of the end of that year's second fiscal quarter, or (ii) annual revenues exceeded $100 million during such completed fiscal year and the market value of the Class A common stock held by non-affiliates exceeds $700 million as of the end of that year's second fiscal quarter. To the extent the Company takes advantage of such reduced disclosure obligations, it may also make the comparison of its financial statements with other public companies difficult or impossible. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements Accounting pronouncements issued and adopted In August 2018, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2018-13, Fair Value Measurement ("Topic 820"), which modifies, removes and adds certain disclosure requirements on fair value measurements. The new guidance was required for the Company for the annual reporting period beginning January 1, 2020 and interim periods within that fiscal year. The Company adopted this guidance starting from January 1, 2020, however, there was no material impact resulting from the adoption of this pronouncement. In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2014-09, Revenue from Contracts with Customers (Topic 606), to achieve a consistent application of revenue recognition within the U.S., resulting in a single revenue model to be applied by reporting companies under GAAP. Under the new model, recognition of revenue occurs when a customer obtains control of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, the revised guidance requires that reporting companies disclose the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. Subsequent to the issuance of ASU 2014-09, the FASB also issued several updates related to ASU 2014-09 including deferring its adoption date. As per the latest ASU 2020-05, issued by the FASB, the entities who have not yet issued or made available for issuance the financial statements as of June 3, 2020 can defer the new guidance for one year. The revised guidance is required to be applied retrospectively to each prior reporting period presented or modified retrospectively applied with the cumulative effect of initially applying it recognized at the date of initial application. The Company adopted this standard on January 1, 2020 utilizing the modified retrospective approach. The Company underwent a process of identifying the various types of revenue streams, performed an evaluation of the components of the associated contractual arrangements and determined that the adoption of the new standard did not have a material impact on the consolidated financial statements. Accounting pronouncements issued but not yet adopted In February 2016, the FASB issued ASU 2016-02, Leases ("Topic 842") which outlines a comprehensive lease accounting model and supersedes the current lease guidance. The new guidance requires lessees to recognize almost all of their leases on the balance sheet by recording a lease liability and corresponding right-of-use assets for all leases with lease terms greater than 12 months. It also changes the definition of a lease and expands the disclosure requirements of lease arrangements. As per the latest ASU 2020-05 issued by FASB, the entities who have not yet issued or made available for issuance the financial statements as of June 3, 2020 can defer the new guidance for one year. The Company will be adopting this guidance for the annual reporting period beginning January 1, 2022, and interim reporting periods within annual reporting period beginning January 1, 2023. This will require application of the new accounting guidance at the beginning of the earliest comparative period presented in the year of adoption. The Company is in the process of evaluating the impact that the pronouncement will have on the consolidated financial statements. In June 2016, the FASB issued ASU 2016-13 Financial Instruments - Credit Losses ("Topic 326") Measurement of Credit Losses on Financial Instruments . In December 2019, the FASB issued ASU 2019-12, Income Taxes ("Topic 740"): Simplifying the Accounting for Income Taxes. ASU 2019-12 is intended to simplify various aspects related to accounting for income taxes. The Company is expecting to adopt the guidance from annual periods beginning after December 15, 2021 and interim periods beginning December 15, 2022. The Company is currently evaluating the impact that the pronouncement will have on the consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Schedule of property and equipment estimated useful lives | Software 3 years Computer Equipment 3 years Furniture and Fixtures 3 years Telemedicine Equipment 2 to 5 years Leasehold Improvements Shorter of remaining lease term or the economic life |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of financial assets and liabilities measured at fair value on a recurring basis | Fair Value Measurements as of Carrying Value Level 1 Level 2 Level 3 Total Assets Cash and cash equivalents $ 38,754 $ 38,754 - - $ 38,754 Total $ 38,754 $ 38,754 - - $ 38,754 Liabilities Contingent shares issuance liabilities $ 12,450 $ - $ - $ 12,450 $ 12,450 Total $ 12,450 $ - $ - $ 12,450 $ 12,450 Fair Value Measurements as of Carrying Value Level 1 Level 2 Level 3 Total Assets Cash and cash equivalents $ 4,541 $ 4,541 - - $ 4,541 Total $ 4,541 $ 4,541 - - $ 4,541 Liabilities Puttable option liabilities $ 1 $ - - $ 1 $ 1 Total $ 1 $ - - $ 1 $ 1 |
Schedule of reconciliation of puttable option liabilities fair value measurements using the significant unobservable inputs (Level 3) | Puttable Option Liabilities Shares Fair Value Balance, December 31, 2018 154,764 $ 164 Shares expired unexercised (32,376 ) (22 ) Change in fair value - (141 ) Balance, December 31, 2019 122,388 $ 1 Shares expired unexercised (12,141 ) (4 ) Change in fair value - 521 Shares exercised (110,247 ) (518 ) Balance, December 31, 2020 - $ - |
Schedule of reconciliation of contingent consideration fair value measurements using the significant unobservable inputs (Level 3) | Contingent Consideration Balance as of December 31, 2018 $ 1,855 (Gain) recognized in statements of operations (1,855 ) Payments - Balance as of December 31, 2019 $ - |
Schedule of reconciliation of contingent shares issuance liabilities fair value measurements using the significant unobservable inputs (Level 3) | Contingent shares issuance liabilities Balance as of December 31, 2019 $ - Contingent shares issuance liabilities 16,687 (Gain) recognized in statements of operations (4,237 ) Balance as of December 31, 2020 $ 12,450 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment | 2020 2019 Telemedicine equipment $ 9,249 $ 6,435 Software 1,386 1,358 Work in progress 115 234 Computer equipment 779 757 Furniture and fixtures 328 328 Leasehold improvements 568 568 $ 12,425 $ 9,680 Less accumulated depreciation (8,333 ) (7,293 ) Total $ 4,092 $ 2,387 |
Capitalized Software Costs (Tab
Capitalized Software Costs (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Capitalized Software Costs Tables Abstract | |
Schedule of capitalized software costs | ecember 31, 2020 Useful Life Gross Value Accumulated Depreciation Net Carrying Value Capitalized software development costs 4 years $ 15,844 $ (6,909 ) $ 8,935 December 31, 2019 Useful Life Gross Value Accumulated Depreciation Net Carrying Value Capitalized software development costs 4 years $ 11,535 $ (3,888 ) $ 7,647 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible assets | December 31, 2020 Useful Life Gross Value Accumulated Amortization Net Carrying Value Weighted Average Hospital contracts relationships 6 to 10 years $ 8,480 $ (3,085 ) $ 5,395 6.5 Non-compete agreements 4 to 5 years 45 (32 ) 13 2.0 Trade names 4 to 5 years 1,810 (1,230 ) 580 1.4 Intangible assets, net $ 10,335 $ (4,347 ) $ 5,988 5.8 December 31, 2019 Useful Life Gross Value Accumulated Amortization Net Carrying Value Weighted Average Hospital contracts relationships 6 to 10 years $ 8,480 $ (2,066 ) $ 6,414 7.5 Non-compete agreements 4 to 5 years 45 (21 ) 24 3.0 Trade names 4 to 5 years 1,810 (819 ) 991 2.4 Intangible assets, net $ 10,335 $ (2,906 ) $ 7,429 6.8 |
Schedule of amortization expense remaining life of intangible assets | Years ending December 31, Amortization Expense 2021 1,437 2022 1,194 2023 629 2024 590 Thereafter 2,138 $ 5,988 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Payables and Accruals [Abstract] | |
Schedule of accrued expenses | Current liabilities 2020 2019 Accrued compensation $ 3,210 $ 2,473 Accrued bonuses 2,647 1,082 Accrued professional and service fees 1,626 2,228 Accrued other expenses 810 295 $ 8,293 $ 6,078 Non-current liabilities Other long term liabilities 560 - $ 560 $ - |
Contingently Redeemable Prefe_2
Contingently Redeemable Preferred Stock (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Contingently Redeemable Preferred Stock [Abstract] | |
Schedule of contingently redeemable preferred stock | A s of December 31, 2020 Liquidation Preference as of 10/30/2020 Redemption through issuance of Cash Redemption through issuance of Class A Common Stock Number of Class A Common Shares Issued (*) Series H $ 124,779 $ 18,136 $ 106,643 10,600,347 Series I 28,593 28,593 - - Series J 16,447 16,447 - - $ 169,819 $ 63,176 $ 106,643 10,600,347 (*) Securities of the surviving company: SOC Telemed, Inc. As of December 31, 2019 Shares Authorized Shares Issued and Outstanding Issue Price Carrying Amount Series H 8,814,825 8,814,825 $ 2.82 $ 32,675 Series I 20,000 20,000 1,000.00 25,412 Series J 4,000 4,000 1,000.00 3,820 8,838,825 8,838,825 $ 61,907 |
Contingent Shares Issuance Li_2
Contingent Shares Issuance Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Contingently Redeemable Preferred Stock [Abstract] | |
Schedule of components of outstanding contingent shares issuance liabilities | 2020 2019 Contingent sponsor earnout shares 11,364 - Private placement warrants 1,086 - Balance at $ 12,450 $ - |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of fair value of each grant was estimated on the grant date | 2020 (1) 2019 Weighted-average volatility 80.0% 55.0% Expected dividends 0.0% 0.0% Expected term (in years) 1 - 5 5 - 10 Risk-free interest rate 0.15% - 0.40% 1.98% - 2.64% (1) No new grants issued in 2020 prior to the Merger Transaction. These assumptions relate to option modifications in 2020. |
Schedule of RSU activity | Number of RSUs Weighted Average Outstanding RSUs at December 31, 2019 - - Granted 1,342,570 9.95 Vested (1,061,320 ) (10.06 ) Outstanding RSUs at December 31, 2020 281,250 7.13 Expected RSUs to vest as of December 31, 2020 281,250 $ 7.13 |
Summary of stock option activity | Shares Weighted-Average Weighted-Average Remaining Outstanding stock options at December 31, 2018 7,687,698 $ 3.09 7.39 Granted 1,276,490 3.63 Exercised (9,509 ) 2.00 Forfeited or expired (689,738 ) 3.86 Outstanding stock options at December 31, 2019 8,264,941 3.11 6.15 Granted - Exercised (5,546,222 ) 3.13 Forfeited or expired (1,175,557 ) 3.18 Outstanding stock options at December 31, 2020 1,543,162 3.05 7.09 Vested or expected stock options to vest at December 31, 2020 914,445 3.05 7.09 Exercisable at December 31, 2020 13,363 $ 6.53 4.65 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of basic and diluted net loss per share | Year Ended 2020 2019 Numerator: Net loss $ (49,847 ) $ (18,242 ) Preferred stock dividends (96,974 ) (5,514 ) Numerator for Basic and Dilutive EPS –Loss available to common stockholders $ (146,821 ) $ (23,756 ) Denominator: Common stock 41,102,162 34,042,596 Series I and Series J Common Warrants 244,687 191,193 Denominator for Basic and Dilutive EPS – Weighted-average common stock outstanding 41,346,849 34,233,789 Basic net loss per share $ (3.55 ) $ (0.69 ) Diluted net loss per share $ (3.55 ) $ (0.69 ) |
Schedule of anti-dilutive common equivalent shares | 2020 2019 Outstanding convertible Series H preferred stock - 8,814,825 Outstanding common warrants 12,849,992 851,627 Outstanding options to purchase common stock 1,543,162 8,264,941 Unvested Sponsor earn-out shares 1,875,000 - Total anti-dilutive common equivalent shares 16,268,154 17,931,393 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of future minimum non-cancelable lease payments | Years ending December 31, Amount 2021 $ 543 2022 and thereafter 33 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of provision for income taxes | 2020 2019 Current: Federal $ - $ - State (31 ) (8 ) $ (31 ) $ (8 ) Deferred: Federal $ - $ - State - - $ - $ - Income tax expense $ (31 ) $ (8 ) |
Schedule of net deferred tax asset balance | 2020 2019 Deferred tax assets: Net operating loss carryforwards $ 56,300 $ 40,110 Deferred revenue 171 69 Deferred rent - 14 Stock options and warrants 22 298 Restricted stock units 315 - Other 426 654 Total deferred tax assets 57,234 41,145 Less: valuation allowance (53,513 ) (37,280 ) Net deferred tax assets before deferred tax liabilities 3,721 3,865 Deferred tax liabilities: Intangible assets (1,448 ) (1,882 ) Property and equipment (74 ) (17 ) Capitalized software costs and other (2,199 ) (1,966 ) Total deferred tax liabilities (3,721 ) (3,865 ) Net deferred tax assets $ - $ - |
Schedule of reconciliation tax rate | 2020 2019 Statutory US federal rate 21.0 % 21.0 % Stock-based compensation 14.8 % (1.0 %) Sec.162(m) (6.1 %) 0.0 % State and local income taxes 1.3 % 0.9 % Change in valuation allowance (32.6 %) (22.9 %) Other 1.5 % 2.0 % Effective tax rate (0.1 %) 0.0 % |
Valuation and Qualifying Acco_2
Valuation and Qualifying Accounts (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
Schedule of allowance for doubtful accounts and deferred tax asset valuation allowance | Balance at the beginning of the period Additions Deductions Balance at the end of the period Year ended December 31, 2019 Allowance for doubtful accounts $ 373 200 (35 ) $ 538 Deferred tax asset valuation allowance 33,097 4,802 (619 ) 37,280 Year ended December 31, 2020 Allowance for doubtful accounts $ 538 85 (176 ) $ 447 Deferred tax asset valuation allowance 37,280 17,041 (808 ) 53,513 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details Textual) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Mar. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Summary of Significant Accounting Policies (Textual) | ||||
Exchange ratio | 0.4047 | |||
Accumulated deficit | $ (236,219) | $ (186,372) | ||
Net losses | (49,847) | (18,242) | ||
Cash outflows from operations | 22,600 | 10,800 | ||
Uninstalled telemedicine equipment | 100 | 200 | ||
Capitalized interest costs | $ 100 | 100 | ||
Intangibles assets description | Intangible assets resulting from these acquisitions include hospital contracts relationships, non-compete agreements and trade names. Hospital contracts relationships are amortized over a period of 6 to 10 years using a straight-line method. Non-compete agreements are amortized over a period of 4 to 5 years using the straight-line method. The trade names represented by NeuroCall and JSA Health are amortized over 5 and 4 years, respectively, using the straight-line method. | |||
Client contracts range length | From 1 to 3 years | |||
Recognize revenue | $ 1,100 | 1,200 | ||
Advertising expenses | $ 900 | 700 | ||
Smaller reporting company, description | (i) the market value of the Class A common stock held by non-affiliates exceeds $250 million as of the end of that year's second fiscal quarter, or (ii) annual revenues exceeded $100 million during such completed fiscal year and the market value of the Class A common stock held by non-affiliates exceeds $700 million as of the end of that year's second fiscal quarter. | |||
Cash and cash equivalents | $ 38,754 | $ 4,541 | $ 3,989 | |
Subsequent Event [Member] | ||||
Summary of Significant Accounting Policies (Textual) | ||||
Cash proceeds from issuance of debt | $ 96,500 | |||
Maximum [Member] | ||||
Summary of Significant Accounting Policies (Textual) | ||||
Consultations represented revenue | 70.00% | 62.00% | ||
Variable consultations represented revenue | 30.00% | 38.00% |
Business Combination (Details)
Business Combination (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($)shares | |
Business Combination (Textual) | |
Merger transaction, description | ● Treasury stock was retired. ● Series H preferred stock was partially redeemed in exchange for Class A common stock resulting in 10,600,347 shares of Class A common stock being issued to the previous Series H preferred stockholders. ● All vested stock options under the Legacy SOC Telemed 2014 Equity Incentive Plan were exercised into Class A common stock resulting in 2,643,694 shares of Class A common stock. ● All outstanding warrants to purchase shares of Legacy SOC Telemed common stock were exercised into Class A common stock resulting in 1,169,452 shares of Class A common stock. ● The Company issued 11,468,485 shares of Class A common stock and the Sponsor Earnout Shares to the former stockholders of HCMC for $ 64.6 million in cash. ● The Company issued 16,800,000 Class A common shares for $168,000,000 through the PIPE, as discussed in Note 4. Apart from the above Merger Transaction related activity, common warrants of Legacy SOC Telemed were exercised during 2020 resulting in 40,795 new shares of Legacy SOC Telemed common stock shares being issued prior to the Merger Transaction. |
Healthcare Merger Corp [Member] | |
Business Combination (Textual) | |
Exchange ratio in merger agreement | 0.4047 |
Received aggregate consideration, amount | |
Merger transaction, description | ● $64.6 million in cash at the closing of the Merger Transaction from HCMC; ● $168.0 million in cash proceeds from a private placement ("PIPE") of Class A Common stock that closed concurrently with the Merger Transaction; and ● 48,504,895 shares of Class A common stock valued at $10.06 per share, totaling $488.0 million. |
Shares of common stock | shares | 1,875,000 |
Business combination, description | The Company redeemed certain Legacy SOC Telemed preferred shareholders for $63.2 million in cash and paid off all existing debt (principal and interests) for $90.3 million in cash. |
Incurred direct and incremental costs | $ 22,700 |
Costs related to transaction bonuses | 2,800 |
Insurance costs | $ 300 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Assets | ||
Cash and cash equivalents | $ 38,754 | $ 4,541 |
Total | 38,754 | 4,541 |
Liabilities | ||
Contingent shares issuance liabilities | 12,450 | |
Puttable option liabilities | 1 | |
Total | 12,450 | 1 |
Carrying Value [Member] | ||
Assets | ||
Cash and cash equivalents | 38,754 | 4,541 |
Total | 38,754 | 4,541 |
Liabilities | ||
Contingent shares issuance liabilities | 12,450 | |
Puttable option liabilities | 1 | |
Total | 12,450 | 1 |
Level 1 [Member] | ||
Assets | ||
Cash and cash equivalents | 38,754 | 4,541 |
Total | 38,754 | 4,541 |
Liabilities | ||
Contingent shares issuance liabilities | ||
Puttable option liabilities | ||
Total | ||
Level 2 [Member] | ||
Assets | ||
Cash and cash equivalents | ||
Total | ||
Liabilities | ||
Contingent shares issuance liabilities | ||
Puttable option liabilities | ||
Total | ||
Level 3 [Member] | ||
Assets | ||
Cash and cash equivalents | ||
Total | ||
Liabilities | ||
Contingent shares issuance liabilities | 12,450 | |
Puttable option liabilities | 1 | |
Total | $ 12,450 | $ 1 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments (Details 1) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | ||
Balance Beginning, Shares | 122,388 | 154,764 |
Balance Beginning, Fair Value | $ 1 | $ 164 |
Shares expired unexercised, Shares | (12,141) | (32,376) |
Shares expired unexercised, Fair Value | $ (4) | $ (22) |
Change in fair value, Shares | ||
Change in fair value, Fair Value | $ 521 | $ (141) |
Shares exercised, Shares | (110,247) | |
Shares exercised, Fair Value | $ (518) | |
Balance, Ending, Shares | 122,388 | |
Balance Ending, Fair Value | $ 1 |
Fair Value of Financial Instr_5
Fair Value of Financial Instruments (Details 2) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Fair Value Disclosures [Abstract] | |
Balance, Beginning | $ 1,855 |
(Gain) recognized in statements of operations | (1,855) |
Payments | |
Balance, Ending |
Fair Value of Financial Instr_6
Fair Value of Financial Instruments (Details 3) $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Fair Value Disclosures [Abstract] | |
Balance, Beginning | |
Contingent shares issuance liabilities | 16,687 |
(Gain) recognized in statements of operations | (4,237) |
Balance, Ending | $ 12,450 |
Fair Value of Financial Instr_7
Fair Value of Financial Instruments (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | ||
Changes in fair value of contingent consideration | $ 0 | $ 1,900 |
Gain on contingent share issuance liabilities | $ 4,200 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Property and equipment, gross | $ 12,425 | $ 9,680 |
Less accumulated depreciation | (8,333) | (7,293) |
Total | 4,092 | 2,387 |
Telemedicine equipment [Member] | ||
Property and equipment, gross | 9,249 | 6,435 |
Software [Member] | ||
Property and equipment, gross | 1,386 | 1,358 |
Work in progress [Member] | ||
Property and equipment, gross | 115 | 234 |
Computer equipment [Member] | ||
Property and equipment, gross | 779 | 757 |
Furniture and fixtures [Member] | ||
Property and equipment, gross | 328 | 328 |
Leasehold improvements [Member] | ||
Property and equipment, gross | $ 568 | $ 568 |
Property and Equipment (Detai_2
Property and Equipment (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Property and Equipment (Textual) | ||
Equipment acquired under capital lease agreements | $ 500 | $ 500 |
Selling, general and administrative expenses [Member] | ||
Property and Equipment (Textual) | ||
Depreciation expense | 100 | 200 |
Cost of revenues [Member] | ||
Property and Equipment (Textual) | ||
Depreciation expense | $ 900 | $ 500 |
Capitalized Software Costs (Det
Capitalized Software Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Capitalized Software Costs Tables Abstract | ||
Capitalized software development costs, Useful Life | 4 years | 4 years |
Capitalized software development costs, Gross Value | $ 15,844 | $ 11,535 |
Capitalized software development costs, Accumulated Depreciation | (6,909) | (3,888) |
Capitalized software development costs, Net Carrying Value | $ 8,935 | $ 7,647 |
Capitalized Software Costs (D_2
Capitalized Software Costs (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Capitalized Software Costs (Textual) | ||
Software development costs capitalized | $ 4,300 | $ 3,900 |
Cost of revenues | $ 3,000 | $ 2,200 |
Goodwill (Details)
Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Goodwill (Textual) | ||
Asset | $ 16,300 | $ 16,300 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Gross Value | $ 10,335 | $ 10,335 |
Accumulated Amortization | (4,347) | (2,906) |
Net Carrying Value | $ 5,988 | $ 7,429 |
Weighted Average Remaining Useful Life (in years) | 5 years 9 months 18 days | 6 years 9 months 18 days |
Intangible assets, net | $ 5,988 | $ 7,429 |
Hospital contracts relationships [Member] | ||
Gross Value | 8,480 | 8,480 |
Accumulated Amortization | (3,085) | (2,066) |
Net Carrying Value | $ 5,395 | $ 6,414 |
Weighted Average Remaining Useful Life (in years) | 6 years 6 months | 7 years 6 months |
Hospital contracts relationships [Member] | Minimum [Member] | ||
Useful Life | 6 years | 6 years |
Hospital contracts relationships [Member] | Maximum [Member] | ||
Useful Life | 10 years | 10 years |
Non-compete agreements [Member] | ||
Gross Value | $ 45 | $ 45 |
Accumulated Amortization | (32) | (21) |
Net Carrying Value | $ 13 | $ 24 |
Weighted Average Remaining Useful Life (in years) | 2 years | 3 years |
Non-compete agreements [Member] | Minimum [Member] | ||
Useful Life | 4 years | 4 years |
Non-compete agreements [Member] | Maximum [Member] | ||
Useful Life | 5 years | 5 years |
Trade Names [Member] | ||
Gross Value | $ 1,810 | $ 1,810 |
Accumulated Amortization | (1,230) | (819) |
Net Carrying Value | $ 580 | $ 991 |
Weighted Average Remaining Useful Life (in years) | 1 year 4 months 24 days | 2 years 4 months 24 days |
Trade Names [Member] | Minimum [Member] | ||
Useful Life | 4 years | 4 years |
Trade Names [Member] | Maximum [Member] | ||
Useful Life | 5 years | 5 years |
Intangible Assets (Details 1)
Intangible Assets (Details 1) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2021 | $ 1,437 | |
2022 | 1,194 | |
2023 | 629 | |
2024 | 590 | |
Thereafter | 2,138 | |
Amortization Expense | $ 5,988 | $ 7,429 |
Intangible Assets (Details Text
Intangible Assets (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Intangible Assets (Textual) | ||
Amortization expense for intangible assets | $ 1,400 | $ 1,400 |
Debt (Details)
Debt (Details) - USD ($) $ in Thousands | Sep. 01, 2020 | Aug. 14, 2020 | Oct. 30, 2020 | Jun. 30, 2016 | Dec. 31, 2020 | Dec. 31, 2019 |
Debt (Textual) | ||||||
Related party transaction, description | Two entities affiliated with WP signed a support letter committing funds up to $15.0 million available to Legacy SOC Telemed from August 2020 through December 2021. On September 3, 2020, Legacy SOC Telemed sold to WP $2.0 million aggregate principal amount of subordinated convertible promissory notes in a financing pursuant to this support letter. WP subsequently recommitted to fund up to $15.0 million available from September 2020 through December 31, 2021, subject to ongoing evaluations between the parties following the closing of the Merger Transaction, under a new support letter dated September 23, 2020, that superseded and replaced the August support letter (see Note 11). As discussed in Note 25, the support letter was terminated in connection with the acquisition of Access Physicians. | The Company modified the terms of 1,875,000 of the Founder Shares held by HCMC Sponsor LLC such that 50% of such shares will be forfeited if the share price of Class A common stock does not reach $12.50 for 20 out of 30 consecutive trading days and 50% of such shares will be forfeited if the share price of Class A common stock does not reach $15.00 for 20 out of 30 consecutive trading days, in each case, prior to the seventh anniversary of the Closing (See Note 16). | ||||
Debt borrowing principal, description | Legacy SOC Telemed also entered into a convertible bridge note purchase agreement with certain previous Legacy SOC Telemed stockholders which permitted Legacy SOC Telemed to borrow aggregate principal in the amount of $8.0 million. Legacy SOC Telemed borrowed $6.0 million of principal pursuant to such convertible bridge note purchase agreement in 2020 (see Note 11). | |||||
Interest expense | $ 100 | |||||
Debt issuance costs | $ 1,400 | |||||
Payoff fee | 6.00% | |||||
Estimated payoff fee | $ 4,700 | |||||
Amortization of debt issuance costs and discount | 12,200 | $ 10,300 | ||||
Fair value | $ 81,000 | |||||
Payoff of debt | $ 1,200 | |||||
Bridge Note Agreement [Member] | ||||||
Debt (Textual) | ||||||
Related party transaction, description | The Merger Transaction, in August 2020, two entities affiliated with Warburg Pincus ("WP") committed to fund up to $15.0 million available from August 2020 through December 31, 2021, subject to ongoing evaluations between the parties following the closing of the Merger Transaction. After Legacy SOC Telemed borrowed $2 million in September 2020, WP subsequently recommitted to fund up to $15.0 million available from September 2020 through December 31, 2021, subject to ongoing evaluations between the parties following the closing of the Merger Transaction, under a new support letter dated September 23, 2020, that superseded and replaced the August support letter. | |||||
Debt borrowing principal, description | Under the Bridge Note Agreement, Legacy SOC Telemed was permitted to borrow aggregate principal of up to $8.0 million, pursuant to an initial closing and potential additional closings on or before January 29, 2021. As discussed above, the initial closing of $2.0 million occurred on September 3, 2020. Two additional closings of $2.0 million each occurred on September 28, 2020 and October 13, 2020 respectively. | |||||
Annual interest rate | 13.00% | |||||
Debt issuance costs | $ 100 |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Current liabilities | ||
Accrued compensation | $ 3,210 | $ 2,473 |
Accrued bonuses | 2,647 | 1,082 |
Accrued professional and service fees | 1,626 | 2,228 |
Accrued other expenses | 810 | 295 |
Total, current liabilities | 8,293 | 6,078 |
Non-current liabilities | ||
Other long term liabilities | 560 | |
Total, Non-current liabilities | $ 560 |
Capital Leases (Details)
Capital Leases (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Capital Leases (Textual) | |
Capital leases interest rate | 20.00% |
Future minimum lease payments | $ 100 |
Puttable Option Liabilities (De
Puttable Option Liabilities (Details) $ / shares in Units, $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($)$ / sharesshares | |
Number of stock option vested | shares | 199,129 |
Conversion of number of stock options and strike prices | shares | 0.4047 |
Puttable options fair value | $ | $ 100 |
Description of expired term | These puttable options were considered to expire from 2020 to 2024. |
Minimum [Member] | |
Shareholders with strike prices range | $ / shares | $ 0.99 |
Maximum [Member] | |
Shareholders with strike prices range | $ / shares | $ 9.64 |
Contingently Redeemable Prefe_3
Contingently Redeemable Preferred Stock (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2020 | Oct. 30, 2020 | Dec. 31, 2019 | ||
Liquidation Preference | $ 169,819 | |||
Redemption through issuance of Cash | $ 63,176 | |||
Redemption through issuance of Class A Common Stock | $ 106,643 | |||
Number of Class A Common Shares Issued | [1] | 10,600,347 | ||
Redeemable convertible preferred stock, shares authorized | 0 | 8,838,825 | ||
Redeemable convertible preferred stock, shares issued | 0 | 8,838,825 | ||
Carrying Amount | $ 61,907 | |||
Series H Preferred Stock [Member] | ||||
Liquidation Preference | 124,779 | $ 32,800 | ||
Redemption through issuance of Cash | 18,136 | |||
Redemption through issuance of Class A Common Stock | $ 106,643 | |||
Number of Class A Common Shares Issued | [1] | 10,600,347 | ||
Redeemable convertible preferred stock, shares authorized | 8,814,825 | |||
Redeemable convertible preferred stock, shares issued | 8,814,825 | |||
Issue Price | $ 2.82 | |||
Carrying Amount | $ 32,675 | |||
Series I Preferred Stock [Member] | ||||
Liquidation Preference | 28,593 | $ 25,700 | ||
Redemption through issuance of Cash | $ 28,593 | |||
Redemption through issuance of Class A Common Stock | ||||
Number of Class A Common Shares Issued | [1] | |||
Redeemable convertible preferred stock, shares authorized | 20,000 | |||
Redeemable convertible preferred stock, shares issued | 20,000 | |||
Issue Price | $ 1,000 | |||
Carrying Amount | $ 25,412 | |||
Series J Preferred Stock [Member] | ||||
Liquidation Preference | $ 16,447 | $ 4,000 | ||
Redemption through issuance of Cash | $ 16,447 | |||
Redemption through issuance of Class A Common Stock | ||||
Number of Class A Common Shares Issued | [1] | |||
Redeemable convertible preferred stock, shares authorized | 4,000 | |||
Redeemable convertible preferred stock, shares issued | 4,000 | |||
Issue Price | $ 1,000 | |||
Carrying Amount | $ 3,820 | |||
[1] | Securities of the surviving company: SOC Telemed, Inc. |
Contingently Redeemable Prefe_4
Contingently Redeemable Preferred Stock (Details Textual) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||||||||
Oct. 30, 2020 | Dec. 31, 2020 | Jun. 12, 2020 | Mar. 27, 2020 | Jan. 28, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Contingently Redeemable Preferred Stock (Textual) | ||||||||||
Price per share | $ 7.02 | |||||||||
Liquidation preference | $ 169,819 | |||||||||
Authorized shares | 5,000,000 | 5,000,000 | ||||||||
Class A Common Stock [Member] | ||||||||||
Contingently Redeemable Preferred Stock (Textual) | ||||||||||
Issuance of stock | 10,600,347 | 922,221 | ||||||||
Series I Preferred Stock [Member] | ||||||||||
Contingently Redeemable Preferred Stock (Textual) | ||||||||||
Cash consideration | 28,600 | $ 20,000 | $ 20,000 | |||||||
Issuance of stock | 20,000 | 20,000 | ||||||||
Offering costs | $ 200 | $ 200 | ||||||||
Cumulative dividends, percentage | 15.00% | |||||||||
Price per share | $ 1,000 | $ 280.77 | ||||||||
Unpaid accumulated dividends | $ 5,600 | |||||||||
Liquidation preference | 28,593 | 25,700 | ||||||||
Diluted equity | 50.00% | |||||||||
Percentage of voting power | 50.00% | |||||||||
Series J Preferred Stock [Member] | ||||||||||
Contingently Redeemable Preferred Stock (Textual) | ||||||||||
Cash consideration | 16,400 | $ 11,000 | $ 3,600 | $ 3,700 | $ 3,700 | $ 4,000 | ||||
Issuance of stock | 4,000 | |||||||||
Offering costs | $ 100 | |||||||||
Cumulative dividends, percentage | 15.00% | |||||||||
Price per share | $ 1,000 | $ 5.55 | ||||||||
Unpaid accumulated dividends | $ 100 | |||||||||
Liquidation preference | $ 16,447 | $ 4,000 | ||||||||
Diluted equity | 50.00% | |||||||||
Percentage of voting power | 50.00% | |||||||||
Authorized shares | 11,000 | |||||||||
Liquidation percentage | 100.00% | |||||||||
Series H Preferred Stock [Member] | ||||||||||
Contingently Redeemable Preferred Stock (Textual) | ||||||||||
Cash consideration | $ 18,100 | $ 24,700 | $ 24,700 | |||||||
Issuance of stock | 8,814,825 | 8,814,825 | ||||||||
Offering costs | $ 500 | $ 500 | ||||||||
Cumulative dividends, percentage | 8.00% | |||||||||
Price per share | $ 2.82 | $ 0.91 | ||||||||
Unpaid accumulated dividends | $ 8,100 | |||||||||
Interest percentage | 25.00% | |||||||||
Liquidation preference | $ 124,779 | $ 32,800 | ||||||||
Description of liquidation | (a) the acquisition of the Company by another entity by means of any transaction or series of related transactions (including without limitation, any reorganization, merger or consolidation, or sale of stock); or (b) a sale of all or substantially all the assets of the Company; unless the Company's stockholders of record as constituted immediately prior to such acquisition or sale, hold at least 50% of the fully diluted equity (including at least 50% of the voting power) of the surviving or acquired entity. The Merger Transaction with HCMC was determined to be a deemed liquidation event and as a result $90.3 million was accreted as additional dividends increasing the Series H liquidation preference to $124.8 million. The Company paid $18.1 million in cash and issued 10,600,397 shares of common stock to settle the required redemption. |
Contingent Shares Issuance Li_3
Contingent Shares Issuance Liabilities (Details) - shares | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Contingently Redeemable Preferred Stock [Abstract] | ||
Contingent sponsor earnout shares | 11,364 | |
Private placement warrants | 1,086 | |
Balance at | 12,450 |
Contingent Shares Issuance Li_4
Contingent Shares Issuance Liabilities (Details Textual) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended |
Oct. 30, 2020 | Dec. 31, 2020 | |
Contingent Shares Issuance Liabilities (Textual) | ||
Contingent sponsor earnout shares, description | As a result of the Merger Transaction, SOC modified the terms of 1,875,000 shares of Class A common stock ("Sponsor Earnout Shares") then held by HCMC's sponsor, such that 50% of such shares will be forfeited if the share price of Class A common stock does not reach a volume-weighted average closing sale price of $12.50 for 20 out of 30 consecutive trading days and 50% of such shares will be forfeited if the share price of Class A common stock does not reach a volume-weighted average closing sale price of $15.00 for 20 out of 30 consecutive trading days, in each case, prior to the seventh anniversary of the closing of the Merger Transaction ("Earnout Period"). The Sponsor Earnout Shares may not be transferred without the Company's consent until the shares vest. In addition, there is a change of control provision. If, during the Earnout Period, there is a change of control pursuant to which (a) the Company's stockholders have the right to receive consideration attributing a value of at least $10.00 but less than $12.50 to each share of Class A common stock and (b) greater than fifty (50%) of the aggregate amount of such consideration is in the form of equity securities, then fifty percent (50%) of the Sponsor Earnout Shares shall be forfeited, and the portion of the remaining fifty percent (50%) of the Sponsor Earnout Shares determined by multiplying (i) fifty percent (50%) of the Sponsor Earnout Shares by (ii) the ratio that the aggregate consideration in the form of equity securities in such transaction bears to the aggregate amount of all consideration in such transaction (including cash and equity securities) shall, in connection with the consummation of such change of control, be converted into such equity securities and shall remain subject to vesting upon the occurrence of the same conditions during the Earnout Period. Additionally, if, during the Earnout Period, there is a change of control pursuant to which Company's stockholders have the right to receive consideration attributing a value of less than $10.00 to each share of Class A common stock, then the Sponsor Earnout Shares shall be forfeited. | |
Noncurrent liability contingent shares issuance liabilities percentage | 85.00% | |
Sponsor earnout shares granted price | $ 15,200 | |
Fair value remeasured price | 11,400 | |
Gain on contingent shares issuance liabilities | $ 3,800 | |
Effective granted price of private placements | 350,000 | |
Private placement warrants term | 5 years | |
Private placement warrants, description | In addition, if the last sales price of the Company’s Class A common stock as quoted on Nasdaq is at least $18.00 for 20 out of 30 consecutive trading days, the Company has the option to repurchase these securities for $0.01 per warrant. | |
Estimated liability granted | $ 1,500 | |
Chief Executive Officer [Member] | ||
Contingent Shares Issuance Liabilities (Textual) | ||
Noncurrent liability contingent shares issuance liabilities percentage | 15.00% | |
Fair value remeasured price | $ 1,100 | |
Gain on contingent shares issuance liabilities | $ 400 | |
Class A Common Stock [Member] | ||
Contingent Shares Issuance Liabilities (Textual) | ||
Contingent sponsor earnout merger transaction shares | 1,875,000 | |
Shares forfeited share price percentage | 50.00% | |
Estimated liability percentage | 85.00% | |
Private Placement [Member] | ||
Contingent Shares Issuance Liabilities (Textual) | ||
Strike price | $ 11.50 |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) (Details) - $ / shares | 1 Months Ended | 12 Months Ended | ||||||||
Oct. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Nov. 30, 2019 | Nov. 30, 2018 | Dec. 31, 2014 | |
Preference stock, shares authorized | 5,000,000 | 5,000,000 | ||||||||
Preference stock, par value | $ 0.0001 | $ 0.0001 | ||||||||
Merger transaction, description | ● Treasury stock was retired. ● Series H preferred stock was partially redeemed in exchange for Class A common stock resulting in 10,600,347 shares of Class A common stock being issued to the previous Series H preferred stockholders. ● All vested stock options under the Legacy SOC Telemed 2014 Equity Incentive Plan were exercised into Class A common stock resulting in 2,643,694 shares of Class A common stock. ● All outstanding warrants to purchase shares of Legacy SOC Telemed common stock were exercised into Class A common stock resulting in 1,169,452 shares of Class A common stock. ● The Company issued 11,468,485 shares of Class A common stock and the Sponsor Earnout Shares to the former stockholders of HCMC for $ 64.6 million in cash. ● The Company issued 16,800,000 Class A common shares for $168,000,000 through the PIPE, as discussed in Note 4. Apart from the above Merger Transaction related activity, common warrants of Legacy SOC Telemed were exercised during 2020 resulting in 40,795 new shares of Legacy SOC Telemed common stock shares being issued prior to the Merger Transaction. | |||||||||
Exchange ratio per share | $ 0.4047 | |||||||||
Class A Common Stock [Member] | ||||||||||
Common stock, shares authorized | 500,000,000 | 53,428,720 | ||||||||
Common stock, par value | $ 0.0001 | $ 0.0001 | ||||||||
Common stock, shares issued | 74,898,380 | 34,140,909 | ||||||||
Common stock, shares outstanding | 74,898,380 | 34,140,909 | ||||||||
Exchange ratio per share | $ 0.4047 | |||||||||
2020 Common Warrants [Member] | ||||||||||
Common stock, shares issued | 12,849,992 | |||||||||
Warrants exercisable | $ 11.50 | |||||||||
Warrants, description | The warrants are exercisable from the date of issuance through October 30, 2025 (the fifth anniversary of the Merger Transaction). | At December 31, 2020 all 12,849,992 warrants (12,499,992 public warrants and 350,000 private placement warrants) remain outstanding. | ||||||||
2019 and 2020 Series J Common Warrants [Member] | ||||||||||
Common stock, shares issued | 120,150 | 108,460 | ||||||||
Common stock, shares outstanding | 108,460 | |||||||||
Warrants converted into shares per share | $ 0.02 | |||||||||
Warrants purchase share | 12,849,992 | 11 | ||||||||
Warrants, description | The Company issued an additional 120,150 Series J common warrants under the same terms, exercisable from the date of issuance through June 2025. | The warrants were exercisable from the date of issuance through December 2024. | ||||||||
2017 and 2018 Series I Common Warrants [Member] | ||||||||||
Common stock, shares issued | 124,105 | 62,057 | ||||||||
Common stock, shares outstanding | 186,162 | |||||||||
Warrants converted into shares per share | $ 0.02 | |||||||||
Warrants purchase share | 9 | |||||||||
Warrants, description | the Company issued an additional 124,105 Series I common warrants under the same terms, exercisable through April and August 2023. | The warrants were exercisable from the date of issuance through November and December 2022. | ||||||||
2016 Common Warrants [Member] | ||||||||||
Common stock, shares issued | 2,024 | |||||||||
Common stock, shares outstanding | 0 | 0 | ||||||||
Warrants exercisable | $ 0.49 | |||||||||
Warrants purchase share | 2,024 | 1 | ||||||||
2015 Common Warrants [Member] | ||||||||||
Common stock, shares outstanding | 851,718 | |||||||||
Warrants exercisable | $ 2.87 | |||||||||
Warrants purchase share | 1 | |||||||||
Warrants, description | All 2015 common warrants were exercised during 2020, as part of the Merger Transaction. Therefore, there were no 2015 common warrants remaining as of December 31, 2020. As of December 31, 2019, 851,718 of the 2015 common warrants remained outstanding. | |||||||||
2015 Common Warrants [Member] | Series H Warrants [Member] | ||||||||||
Warrants purchase share | 123,432 | |||||||||
2015 Common Warrants [Member] | Series G Warrants [Member] | ||||||||||
Warrants purchase share | 851,718 | |||||||||
2014 Common Warrants [Member] | ||||||||||
Common stock, shares issued | 101,175 | |||||||||
Warrants exercisable | $ 19.77 | $ 19.77 | $ 14.31 | |||||||
Warrant [Member] | ||||||||||
Common stock, shares outstanding | 12,849,992 | 1,146,340 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) | 12 Months Ended | ||
Dec. 31, 2020 | [1] | Dec. 31, 2019 | |
Weighted-average volatility | 80.00% | 55.00% | |
Expected dividends | 0.00% | 0.00% | |
Minimum [Member] | |||
Expected term (in years) | 1 year | 5 years | |
Risk-free interest rate | 0.15% | 1.98% | |
Maximum [Member] | |||
Expected term (in years) | 5 years | 10 years | |
Risk-free interest rate | 0.40% | 2.64% | |
[1] | No new grants issued in 2020 prior to the Merger Transaction. These assumptions relate to option modifications in 2020. |
Stock-Based Compensation (Det_2
Stock-Based Compensation (Details 1) - Restricted Stock Units (RSUs) [Member] | 12 Months Ended |
Dec. 31, 2020$ / sharesshares | |
Number of RSUs | |
Number of RSUs, Beginning Balance | shares | |
Number of RSUs, Granted | shares | 1,342,570 |
Number of RSUs, Vested | shares | (1,061,320) |
Number of RSUs, Ending Balance | shares | 281,250 |
Number of RSUs, Expected | shares | 281,250 |
Weighted Average Fair Value | |
Weighted Average Grant Date Fair Value, Beginning Balance | $ / shares | |
Weighted Average Grant Date Fair Value, Granted | $ / shares | 9.95 |
Weighted Average Grant Date Fair Value, Vested | $ / shares | (10.06) |
Weighted Average Grant Date Fair Value, Ending Balance | $ / shares | 7.13 |
Weighted Average Grant Date Fair Value, Expected | $ / shares | $ 7.13 |
Stock-Based Compensation (Det_3
Stock-Based Compensation (Details 2) - $ / shares | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Number of Shares | ||
Number of Shares, Beginning Balance | 8,264,941 | 7,687,698 |
Number of Shares, Granted | 1,276,490 | |
Number of Shares, Exercised | (5,546,222) | (9,509) |
Number of Shares, Forfeited or expired | (1,175,557) | (689,738) |
Number of Shares, Ending Balance | 1,543,162 | 8,264,941 |
Number of Shares, Vested or expected stock options to vest | 914,445 | |
Number of Shares, Exercisable | 13,363 | |
Weighted-Average Exercise Price | ||
Weighted-Average Exercise Price, Beginning Balance | $ 3.11 | $ 3.09 |
Weighted-Average Exercise Price, Granted | 3.63 | |
Weighted-Average Exercise Price, Exercised | 3.13 | 2 |
Weighted-Average Exercise Price, Forfeited or expired | 3.18 | 3.86 |
Weighted-Average Exercise Price, Ending Balance | 3.05 | $ 3.11 |
Weighted-Average Exercise Price, Vested or expected stock options to vest | 3.05 | |
Weighted-Average Exercise Price, Exercisable | $ 6.53 | |
Weighted-Average Remaining Contractual Term (in years) | ||
Weighted-Average Remaining Contractual Term, Beginning Balance | 6 years 1 month 24 days | 7 years 4 months 20 days |
Weighted-Average Remaining Contractual Term, Ending Balance | 7 years 1 month 2 days | 6 years 1 month 24 days |
Weighted-Average Remaining Contractual Term, Vested or expected stock options to vest | 7 years 1 month 2 days | |
Weighted-Average Remaining Contractual Term, Exercisable | 4 years 7 months 24 days |
Stock-Based Compensation (Det_4
Stock-Based Compensation (Details Textual) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | |
Aug. 18, 2020USD ($) | Dec. 31, 2020USD ($)$ / sharesshares | Dec. 31, 2019USD ($)$ / sharesshares | |
Stock-Based Compensation (Textual) | |||
Exchange ratio | 0.4047 | ||
Weighted-average grant-date fair value | $ / shares | $ 3.64 | ||
Stock-based compensation expense | $ 7,400 | $ 17,900 | $ 1,100 |
Weighted-average period | 1 year 2 months 12 days | ||
Description of options extended | The Company modified two option grants such that the period to exercise the options was extended from July 2020 to January 2021. | ||
Incremental stock compensation expense | $ 800 | ||
Percentage of award stock units | 1.35% | ||
Selling, general and administrative expense | $ 10,700 | ||
Outstanding shares, percentage | 3.00% | ||
Cash payment of accrued liability | $ 4,200 | ||
Remitances of withholding taxes | 11,900 | ||
Unrecognized compensation cost | $ 22,600 | ||
Remaining weighted-average vesting period | 1 year 7 months 6 days | ||
Stock options exercised | $ 0 | $ 100 | |
Intrinsic value of the options exercised | $ 38,400 | 100 | |
Intrinsic value of the outstanding options | $ 7,400 | ||
Monte Carlo [Member] | |||
Stock-Based Compensation (Textual) | |||
Weighted-average grant-date fair value | $ / shares | $ 2,700 | ||
Stock-based compensation expense | $ 800 | ||
Sponsor [Member] | |||
Stock-Based Compensation (Textual) | |||
Percentage of award stock units | 15.00% | ||
2020 Plan [Member] | |||
Stock-Based Compensation (Textual) | |||
Description of common stock and future grants | Total number of shares of Common Stock reserved for awards under the 2020 Plan initially equaled 11% of the fully diluted capitalization of the Company as of the closing of the Merger Transaction, or 9,672,709 shares of Class A common stock. The maximum number of Class A common shares available for future grants under the 2020 Plan is 9,672,709 as of December 31, 2020. There were no grants under the 2020 Plan in 2020. | ||
Class A Common Stock [Member] | |||
Stock-Based Compensation (Textual) | |||
Options to purchase common stock | shares | 10,600,347 | 922,221 | |
Repurchase of stock value | $ 11,900 |
Employee Retirement Plans (Deta
Employee Retirement Plans (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Compensation Related Costs [Abstract] | ||
Employee benefit expense | $ 1,200 | $ 1,000 |
Net Loss Per Share (Details)
Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Numerator: | ||
Net loss | $ (49,847) | $ (18,242) |
Preferred stock dividends | (96,974) | (5,514) |
Numerator for Basic and Dilutive EPS –Loss available to common stockholders | $ (146,821) | $ (23,756) |
Denominator: | ||
Common stock | 41,102,162 | 34,042,596 |
Series I and Series J Common Warrants | 244,687 | 191,193 |
Denominator for Basic and Dilutive EPS - Weighted-average common stock outstanding | 41,346,849 | 34,233,789 |
Basic net loss per share | $ (3.55) | $ (0.69) |
Diluted net loss per share | $ (3.55) | $ (0.69) |
Net Loss Per Share (Details 1)
Net Loss Per Share (Details 1) - shares | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Total anti-dilutive common equivalent shares | 16,268,154 | 17,931,393 |
Outstanding convertible Series H preferred stock [Member] | ||
Total anti-dilutive common equivalent shares | 8,814,825 | |
Outstanding common warrants [Member] | ||
Total anti-dilutive common equivalent shares | 12,849,992 | 851,627 |
Outstanding options to purchase common stock [Member] | ||
Total anti-dilutive common equivalent shares | 1,543,162 | 8,264,941 |
Unvested Sponsor earn-out shares [Member] | ||
Total anti-dilutive common equivalent shares | 1,875,000 |
Net Loss Per Share (Details Tex
Net Loss Per Share (Details Textual) | 1 Months Ended |
Oct. 30, 2020 | |
Net Loss Per Share (Textual) | |
Exchange ratio | 0.4047 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2021 | $ 543 |
2022 and thereafter | $ 33 |
Commitments and Contingencies_3
Commitments and Contingencies (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Commitments and Contingencies (Textual) | ||
Description of expiry of lease agreement | The Company leased three separate facilities under non-cancelable operating agreements expiring on September 30, 2020, December 31, 2021, and October 31, 2022, respectively. The lease agreement expired in September 2020 was not renewed. | |
Rent expense | $ 600 | $ 700 |
Telemedicine and Office Equipment [Member] | ||
Commitments and Contingencies (Textual) | ||
Description of expiry of lease agreement | Under various non-cancelable operating leases through February 2021. | |
Rent expense | $ 100 | 200 |
Office Equipment [Member] | ||
Commitments and Contingencies (Textual) | ||
Description of expiry of lease agreement | The Company also leased office equipment under various non-cancelable operating leases through December 2019. | |
Rent expense | $ 0 | $ 100 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Current: | ||
Federal | ||
State | (31) | (8) |
Total current tax benefit | (31) | (8) |
Deferred: | ||
Federal | ||
State | ||
Total federal tax benefit | ||
Income tax expense | $ (31) | $ (8) |
Income Taxes (Details 2)
Income Taxes (Details 2) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred tax assets: | ||
Net operating loss carryforwards | $ 56,300 | $ 40,110 |
Deferred revenue | 171 | 69 |
Deferred rent | 14 | |
Stock options and warrants | 22 | 298 |
Restricted stock units | 315 | |
Other | 426 | 654 |
Total deferred tax assets | 57,234 | 41,145 |
Less: valuation allowance | (53,513) | (37,280) |
Net deferred tax assets before deferred tax liabilities | 3,721 | 3,865 |
Deferred tax liabilities: | ||
Intangible assets | (1,448) | (1,882) |
Property and equipment | (74) | (17) |
Capitalized software costs and other | (2,199) | (1,966) |
Total deferred tax liabilities | (3,721) | (3,865) |
Net deferred tax assets |
Income Taxes (Details 3)
Income Taxes (Details 3) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||
Statutory US federal rate | 21.00% | 21.00% |
Stock-based compensation | 14.80% | (1.00%) |
Sec.162(m) | (6.10%) | 0.00% |
State and local income taxes | 1.30% | 0.90% |
Change in valuation allowance | (32.60%) | (22.90%) |
Other | 1.50% | 2.00% |
Effective tax rate | (0.10%) | 0.00% |
Income Taxes (Details Textual)
Income Taxes (Details Textual) $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Income Tax (Textual) | |
Federal net operating loss carryforwards | $ 232,900 |
Gross state net operating loss carryforward | $ 182,900 |
Description of federal net operating loss carryforwards | The federal net operating loss carryforwards of $111.9 million generated subsequent to the year ended December 31, 2017 carry forward indefinitely, while the remaining federal net operating loss carryforwards of $121 million begin to expire in 2025. |
Ownership change, percentage | 5.00% |
Related-Party Transactions (Det
Related-Party Transactions (Details) - shares | Aug. 14, 2020 | Dec. 12, 2019 | Oct. 30, 2020 | Oct. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 |
Related-Party Transactions (Textual) | ||||||
Founder shares description | HCMC effected a 1.1 for 1 stock dividend for each Founder Share outstanding, resulting in the Sponsor holding an aggregate of 6,325,000 Founder Shares. | HCMC Sponsor LLC purchased 5,750,000 shares (the "Founder Shares") of the HCMC's Class B common stock for an aggregate price of $25,000. | ||||
Aggregate issued shares subject to forfeiture | 825,000 | |||||
Description of related party transaction | Two entities affiliated with WP signed a support letter committing funds up to $15.0 million available to Legacy SOC Telemed from August 2020 through December 2021. On September 3, 2020, Legacy SOC Telemed sold to WP $2.0 million aggregate principal amount of subordinated convertible promissory notes in a financing pursuant to this support letter. WP subsequently recommitted to fund up to $15.0 million available from September 2020 through December 31, 2021, subject to ongoing evaluations between the parties following the closing of the Merger Transaction, under a new support letter dated September 23, 2020, that superseded and replaced the August support letter (see Note 11). As discussed in Note 25, the support letter was terminated in connection with the acquisition of Access Physicians. | The Company modified the terms of 1,875,000 of the Founder Shares held by HCMC Sponsor LLC such that 50% of such shares will be forfeited if the share price of Class A common stock does not reach $12.50 for 20 out of 30 consecutive trading days and 50% of such shares will be forfeited if the share price of Class A common stock does not reach $15.00 for 20 out of 30 consecutive trading days, in each case, prior to the seventh anniversary of the Closing (See Note 16). | ||||
Debt borrowing principal, description | Legacy SOC Telemed also entered into a convertible bridge note purchase agreement with certain previous Legacy SOC Telemed stockholders which permitted Legacy SOC Telemed to borrow aggregate principal in the amount of $8.0 million. Legacy SOC Telemed borrowed $6.0 million of principal pursuant to such convertible bridge note purchase agreement in 2020 (see Note 11). | |||||
Series J Preferred Stock [Member] | ||||||
Related-Party Transactions (Textual) | ||||||
Share issued | 11,000 | 4,000 | ||||
Over-Allotment Option [Member] | ||||||
Related-Party Transactions (Textual) | ||||||
Aggregate issued shares subject to forfeiture | 75,000 |
Valuation and Qualifying Acco_3
Valuation and Qualifying Accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Allowance for doubtful accounts [Member] | ||
Balance at the beginning of the period | $ 538 | $ 373 |
Additions | 85 | 200 |
Deductions | (176) | (35) |
Balance at the end of the period | 447 | 538 |
Deferred tax asset valuation allowance [Member] | ||
Balance at the beginning of the period | 37,280 | 33,097 |
Additions | 17,041 | 4,802 |
Deductions | (808) | (619) |
Balance at the end of the period | $ 53,513 | $ 37,280 |
Subsequent Events (Details)
Subsequent Events (Details) - Subsequent Event [Member] - shares | 1 Months Ended | ||
Mar. 31, 2021 | Feb. 28, 2021 | Jan. 31, 2021 | |
Subsequent Events (Textual) | |||
Subsequent events, description | The Company granted an aggregate of 3,589,248 and 2,349,489, respectively, of restricted and performance stock units to officers, directors, and employees of the Company. Based upon the terms of the award agreements, the restricted stock units will vest over a period of one to five years, subject to the grantee's continued service on each applicable vesting date and the achievement of the applicable performance criteria. The performance stock units will vest if shares of the Company's Class A common stock reach volume-weighted average closing sale prices of $12.50, $15.00, $17.50 or $20.00 for 20 out of 30 consecutive trading days, in each case, prior to the third anniversary of the grant date. | The Company granted an aggregate of 3,589,248 and 2,349,489, respectively, of restricted and performance stock units to officers, directors, and employees of the Company. Based upon the terms of the award agreements, the restricted stock units will vest over a period of one to five years, subject to the grantee's continued service on each applicable vesting date and the achievement of the applicable performance criteria. The performance stock units will vest if shares of the Company's Class A common stock reach volume-weighted average closing sale prices of $12.50, $15.00, $17.50 or $20.00 for 20 out of 30 consecutive trading days, in each case, prior to the third anniversary of the grant date. | |
Access Physicians [Member] | |||
Subsequent Events (Textual) | |||
Equity purchase agreement, description | Pursuant to the Agreement, SOC Telemed acquired Access Physicians with a combination of 40% cash, 43% shares, and 17% contingent consideration to be paid in cash, shares or a combination of cash and shares, at the Company's election, for aggregate purchase consideration of approximately $234 million. The contingent consideration, if earned, would be payable upon the achievement of certain milestones agreed upon with Access Physicians. The terms of the Agreement contain customary representations, warranties, covenants, closing conditions, termination fee provisions and other terms relating to the transactions contemplated. In order to consummate the acquisition and support the combined business after the transaction, SOC Telemed entered into a term loan facility and a related-party subordinated financing with Warburg Pincus for $100.0 million and $13.5 million, respectively, with maturities of 2026 and 2026, respectively. Additionally, the pre-existing WP support letter was terminated in conjunction with this financing. | ||
Restricted Stock [Member] | |||
Subsequent Events (Textual) | |||
Aggregate of share-based to officers, directors and employees | 2,349,489 | 3,589,248 | |
Outstanding percentage | 3.00% |